Pulmonx at Goldman Sachs Conference: Strategic Growth Insights

On Wednesday, 11 June 2025, Pulmonx Corp (NASDAQ:LUNG) presented its strategic vision at the Goldman Sachs 46th Annual Global Healthcare Conference. The company outlined its market position, financial performance, and future growth strategies, highlighting both opportunities and challenges in the evolving healthcare landscape.

Key Takeaways

• Pulmonx targets a $12 billion total addressable market for severe emphysema.
• The company reported 22% revenue growth last year, with a strong cash position of $88.7 million.
• Zephyr valve technology is central to Pulmonx’s strategy, backed by strong clinical validation.
• Geographic expansion plans include China and Japan, with significant market potential.
• The "acquire, test, and treat" strategy aims to bridge the gap between patient activation and procedures performed.

Financial Results

• Pulmonx reported a 22% revenue growth in the previous year and over 20% growth in Q1, reaching $22.5 million.
• U.S. revenue accounted for $14.2 million, while international revenue was $8.3 million.
• Gross margins are at 73%, with a projected increase to 74% for the year.
• The company maintains a robust cash position of $88.7 million.
• Revenue guidance for the current year is set between $96 million and $98 million.

Operational Updates

• Pulmonx’s Zephyr valve technology is a minimally invasive treatment for severe emphysema, validated by four randomized controlled trials.
• The company has treated over 40,000 patients globally, with broad reimbursement coverage.
• Pulmonx is developing the AERISEAL polymeric foam sealant to address collateral ventilation, with a 77.6% conversion rate in initial trials.
• The "acquire, test, and treat" strategy includes direct-to-patient advertising and peer-to-peer education for pulmonologists.

Future Outlook

• Pulmonx is focused on expanding its market presence in China through a distribution agreement.
• A post-approval study is underway in Japan, with a rollout expected in 2026.
• The company is advancing its next-generation product, currently in the IDE phase, with PMA expected by 2027.

Q&A Highlights

• CEO Steve Williamson emphasized the $12 billion market opportunity, with 500,000 addressable patients in the U.S. and 700,000 internationally.
• Williamson highlighted the importance of educating doctors through peer-to-peer interactions to drive growth.
• The company is leveraging AI-powered technology, LungTrax Detect, to identify undiagnosed emphysema patients.

For a detailed review of Pulmonx’s presentation and strategic initiatives, please refer to the full transcript.

Full transcript - Goldman Sachs 46th Annual Global Healthcare Conference:

Steve Williamson, President and CEO, Palmonix: Good morning, everyone. My name is Steve Williamson. I’m the President and CEO of Palmonix. Thanks for joining us today. I’ll get started with a forward looking statement.

If you’re looking for more information on this and more detailed information, it can be found on the Investor section of our website under Investor Relations or our full 10 ks. Investment highlights. So here’s pulmonics. This is what I’d like you to remember about pulmonics. I’ll go through more detail on each of these items.

But when you look at this opportunity and you look at this company, we’re really focused on a large market. There’s a $12,000,000,000 TAM here, and I’ll walk you through how we get to that. But that’s made up of about 500,000 patients in The United States that represent about $5,000,000,000 of that TAM and 700,000 patients outside The United States that suffer from severe emphysema. Product is broadly reimbursed globally, So it’s reimbursed with ICD-ten codes and CPT codes in The United States. It’s also reimbursed outside The United States and Europe and across Australia as well.

It’s a broadly accepted technology. We are grade A evidence, so the standard of care in the gold COPD guidelines, and we’ve done over forty thousand patients have been treated with our technology. We have a strong pipeline. It’s not just Zephyr valves. We have our next generation product that is currently in an IDE.

We expect a PMA from that to come out in approximately 2027. We’ve got a strong team as well. We have centuries of pulmonary experience on our team. For a small company, we’ve got people that have really been in this area for a long time. We’ve got great relationships with our key opinion leaders and across the board with the pulmonary, customers globally.

Consistent clinical results. I mentioned that we are standard of care. The reason we’re standard of care, we have four randomized controlled trials and over 100 pieces of public out there. So there’s significant scientific data out there to back the clinical effectiveness of Zephyr valves in patients with severe emphysema. Precision treatment, so we have a proprietary patient selection technology which differentiates us from other technologies that are out there.

And we offer a minimally invasive treatment. So we have the ability to not only identify patients, identify what how they’re going to do best through our Stratix platform, and then bring them to the table and treat them with a minimally invasive option for severe breathlessness. The burden of emphysema is a big one. Emphysema is patients with severe emphysema have a worse quality of life than patients with stage four lung cancer. This is a really debilitating disease, and it’s progressive.

It’s a progressive spiral downhill. So it starts with hyperinflation of the lungs. You have a lobe of the lungs that is hyperinflated, many times holding a liter. Two liters of oxygen are stuck in this lung lobe, which then prevents the healthy lobe from healthy lobes from actually expanding. So you end up with this hyperinflation of a lobe.

That causes a shortness of breath in this patient. They end up with decreased activity. As you can imagine, it’s difficult for them to breathe. I was talking to a patient the other day that told me that it took three hours to put her pants on in the morning. It was that debilitating.

They can’t walk to the mailbox. They can’t get the front door. It’s very, very debilitating for them. They stop, their activity decreases, and it just spirals downhill from there. As exercise less, as you have less activity, your ability exercise continues to go down.

Progressive deconditioning and then these patients end up in the hospital with highly compromised quality of life and high risk of mortality as well. There’s one point five million patients with severe emphysema in The USA. As I mentioned earlier, I believe there’s about five hundred thousand of those patients will be eligible for Zephyr Vals. What’s the spectrum of treatment options for these patients? Most of them will start on medical management.

Almost all of them will start on medical management. They’ll go through a number of inhalers, potentially pulmonary rehab. The alternative to that on the other side of the spectrum are more invasive options, lung volume reduction surgery or lung transplant. Small, small volumes of the surgical, highly invasive procedures are done. The Zephyr valves really fall in the middle.

It’s a minimally invasive alternative. It’s done through a bronchoscope. There’s no incisions made. It’s a relatively quick procedure where the patient comes in, is sedated, and receives the valves. As far as how the patient gets there, the standard COPD workup is done.

They’ll undergo pulmonary function testing and a CT scan. The doctor will then take that CT scan, send it to a cloud based portal that we run, We’ll generate a report to help identify the lobes that that patient would benefit from having treated. Patient’s then brought back in. That patient is sedated. They run a Chartist balloon catheter to do an assessment to see if that patient has what’s called collateral ventilation.

So as I mentioned earlier, you’ve this patient that has this huge hyperinflated lobe. We’re trying to take the oxygen out of that lobe so the other ones can expand. Well, if you’re trying to take the oxygen out of that lobe and I’m trying to pull it out over here and pull out this oxygen, if somebody opens that door, there’s just going be air coming in the back. That’s what we would call collateral ventilation. That door is actually a fissure between the lobes in this patient.

So if I’m pulling out this way and they’re able to get oxygen through a different lobe and it’s coming in through a fissure, that patient has what’s called collateral ventilation. I’ll talk more about that because that’s our next generation product we’re talking about, goes after those patients. About twenty to twenty five percent of the time a patient comes in for a procedure, they will have collateral ventilation, they won’t be able to receive valves. Bronchoscopic placement of the valves is then done. Typically three to four valves are placed per patient, and patient remains in the hospital for monitoring for three days after the procedure.

I think this is helpful because people often say, like, what what’s the valve look like? It’s about the size of a pencil eraser, maybe a little bit bigger than that. It’s a nitinol scaffold with a silicone valve inside, and I’ll show you how it works here. Quick little video. You can see the valve is opening at the end here.

There, it’s closed. It opens up and allows air to escape from inside the lung and then come down. So on this video that you’re looking at right now, the upper left lobe right here is the hyperinflated lobe. It is huge right now. There’s there’s liters of trapped air in this lobe.

Physician goes in with the bronchoscope. They’re gonna place three different valves in this patient. I’ll put one in each of these three airways that feed the lobe. You’ll see what happens is oxygen coming in cannot get through the valve. Oxygen does escape from the lobe through the valve.

So this will deflate that lobe without allowing additional oxygen to get in. So what happens is this major large lobe here, you’ll see it shrink and shrink and shrink, and as it does, the healthier tissue expands. Now that tissue can get more oxygen because it’s not compressed within the cavity. That oxygen then goes, perfuses the blood, that patient begins to do better and better and better. So that’s how the Zephyrh valves work.

I think it’s a little counterintuitive when you think about these patients that can’t breathe. It’s not that they have too much oxygen stuck in their lungs, but that’s what’s happening. And so we need to let that oxygen out of the area of their lungs that it is so that they can go then fill lobes that would benefit from it. So as these patients receive this technology, you see a successful lobar occlusion, so we’re able to occlude those portions of the lung. They reduce gas trapping, so we don’t see that major, major hyperinflation.

The lungs begin to work better. They don’t have the breathlessness that they had. They can now have a better quality of life. They’re able to exercise. It’s actually a six minute walk distance.

Do they have the ability to walk to the mailbox and back? That is a big deal for these patients. And imagine that, as they can go. Actually, I received a note from a patient the other day who was excited. He had sent a message over and was walking two miles now.

And they said, you know, he couldn’t even, he couldn’t walk to the bathroom, and now he’s walking two miles. And that doesn’t happen with every patient, but we get a lot of great success stories where it just really changes their life. And as you can imagine, once you’re walking, once you get moving, your health status gets better, BMI gets better, quality of life gets better. I mentioned that we have four randomized controlled trials. This is really something you don’t see a lot with a company that’s been around as long as we have.

It’s a smaller medical device company. I mean, we’ve been around for our IPO was four years ago, to have four randomized controlled trials and be standard of care is pretty impressive. If you look, we’ve showed statistical significant improvement on lung function, so FEV1. We’ve seen it on exercise capacity and quality of life. So all of these areas we’ve shown in numerous studies that we do have a benefit.

The clinical value proposition for this product is very, very strong. Because of that, as I mentioned, we’re in the gold guidelines, evidence A. We’ve been in there since 2020, so in the fifth year report, we’re still in there. Bronchial valve treatment for patients with severe emphysema is the standard of care treatment. The reason being you see improved survival in these patients.

There’s fewer complications, and comparable benefits to lung volume reduction surgery. We see improved FEV1, six minute walk and health status in these patients. These patients have decreased exacerbations. I think that speaks a little bit to the economic value proposition that we have here as well. These patients, when treated, are less likely to end up in the hospital with exacerbations and through the ER and long stays.

Decreased respiratory failure episodes. Actually it’s interesting, so it may delay the need for a lung transplant, so you can see this is a bridge to transplant, but also these patients actually sometimes are not healthy enough for transplant. If you can get them so that they have less breathlessness, then that can be a bridge to transplant that will actually help them get on that transplant list and receive the transplant they need. Reimbursement. Coding, coverage, and payment.

All good. From a coding perspective, we have CPT codes for both the valve procedure as well as just the Chartas procedure. We have ICD-ten codes for the procedure as well. This is covered, and I’ll talk in the payment in a section, but the procedure is covered as an inpatient procedure. It’s covered under three different DRGs, 163, 164, and 165, which is interesting.

It’s a bronchoscopic procedure that is reimbursed under major chest procedures inpatient DRG. You don’t see it a lot. It’s because of the value of the clinical benefits that I mentioned earlier. From a payer mix, we have exceptional coverage. We end up with about 73% of my patient volume is Medicare.

We’ve got 6% Medicaid. 21% are commercial pay. We get coverage in over ninety five percent of the patients that we seek coverage for. So good strong coverage across The U. S.

And then payment physician gets a payment consistent with complex bronchoscopy, advanced bronchoscopies, so they receive payments there. And then there’s Medicare hospitals that vary across the country, but reimbursement from a Medicare perspective is typically very strong here for these the procedure. And as I mentioned, it’s in three different DRGs, 163, one sixty four, one hundred sixty five. Those are differentiated by complication rates. So if there’s complications, then it falls under one DRG.

And comorbidities, does that patient have comorbidities that put them into a different DRG? I would say the majority of these patients come in pretty sick, so they have those comorbidities, so they’re already into that heightened DRG and then it’s due they have complications or not that really dictates where they end up landing. I talked about the global opportunity. So three point eight million patients with emphysema in The US. Severe emphysema, so Class III and Class IV emphysema, one point five million patients as we look at which portion of those have this hyperinflation that I showed you, one point two million.

And then we start looking at can these patients actually receive valves. Like what’s really the market look like here? We believe there’s five hundred thousand patients in The US that are CV negative, so they don’t have that collateral ventilation, which we believe knocks twenty five percent of the patients, and they don’t have exclusionary comorbidities, whether it be BMI, age, a number of different restrictions that can be in place, coronary issues. So we believe there’s five hundred thousand patients here. And one of the things that I’ve done, I’ve been here for a year.

I’ve been the CEO for just over a year, and I came from some larger companies. I’ve looked at a lot of TAMs over time, spent a lot of time with the marketing folks looking at how they build these. So how do you validate the TAM? Does it make sense? Five hundred thousand patients out of three point eight million with emphysema seems like a pretty conservative estimate.

That seems somewhat reasonable to me. But what I’ve noticed and what we’ve seen recently is if you look at our marketing data, last year we had fifty six thousand patients that actually took action on our website. So we had over a million patients or a million people hit the website, but 56,000 patients came in and actually took a quiz about their breathlessness or called our helpline and talked to a respiratory therapist. 56,000. So if I put that in perspective, there’s less than 10,000 BLVR procedures were done last year.

10,000 versus 500,000 in The United States. We’re really scratching the surface here. It’s okay. So how do you build that bridge? What’s what’s missing?

So if you’ve got people calling, you believe the TAM, you’ve got people calling, they’re hitting the website, they’re taking tests, how come how come you’ve done less than 10,000 procedures? That doesn’t align. What are you doing? Well, we’re building that bridge. What’s happened is we’ve got these patients that are activated, that want to have the procedure, but then they go talk to their community pulmonologist, and many times the community pulmonologist is not educated on this procedure.

They don’t know about it. They don’t know what patient would benefit from it. They don’t know what they’re looking for from a workup perspective. So we’re doing a lot to really get after those patients. We do that through our new strategy, which is our acquire, test and treat.

We want to acquire prospective patients. We do that through direct to patient advertising. We started this geo targeted. We found with Connected TV, we have the ability to go broader for less money. It doesn’t make a whole lot of sense, but you can actually go nationally for less money than in targeted areas.

So we do direct to patient advertising to these patients that have been identified through Connected TV that are looking for solutions for breathlessness. Peer to peer education, as I mentioned, now I’ve turned on these patients. They want to go and have a treatment. They don’t know where to go. Who do they talk to?

They go talk to their COPD doctor. If their COPD doctor is not aware of this technology, he’s going give them another inhaler or he’s going say, I’m sorry, this isn’t for you. So we have to educate these doctors that are in the community. I believe the best way to do that is for doctors to talk to doctors. As they educate about the procedure and what the values and benefits are, that’s really where we’re going to see growth.

We’ve more than doubled our peer to peer education year over year here. Lung screening programs. There’s a number of programs right now that go and look for nodules. And you guys know Intuitive quite well, I’m sure. They have the ION robot.

They’re out there. They’re looking at nodules. Those patients that are in these lung screening programs are a significant overlap for patients with emphysema. It’s this 55 to 75 year old, either former or current smoker, that’s your lung cancer patient. These are the ones that are coming in that are at 20 plus packs a year.

They’ve got a good strong smoking history, which means that they’re likely nodule candidates. We have eighty five percent overlap in some instances where the same patient population comes together. LungTrax Detect. So what we’ve done, and this is a new technology that we’ve brought to our customers, it’s really it’s not a medical device, but it’s a technology. What we’ve done is allow them to go in and streamline the workflow of the patients that come through.

So as they go in, I mentioned a Stratix earlier, that patient goes in, receives a Stratix, comes back. We can streamline the workflow to get that patient from the workup to the table to get treatment. But at the same time, what we have the ability to do is scan the PAC system of the hospital. I mentioned these lung nodule programs that people are building. Each of those patients come in and they get a CT scan.

Those CT scans sit in the PAC system. We can passively, for the hospital, take those CT scans from the PACS system, run them into the cloud through a secure portal that that hospital is already using, send it back with a list of patients that we’ve identified with severe emphysema. We’ve identified about fifteen percent on average is the percent of patients that we’re able to identify out of their PAC system that have undiagnosed emphysema. Those patients then work down and can get treated and put on the table. I’ll talk a little bit more about that in a couple slides.

And then we’ve got a therapy awareness specialist. I think this community pulmonologist is a big missing point for us, and so we’ve hired seven therapy awareness specialists. We’ll build on that once we see their effectiveness. But we just put them in place, they started May 1. Testing, we talk about how do we get these patients through the testing process and get them on the table.

We are currently partnering with a party. It’s kind of a co marketing agreement for virtual navigators, which allow us to manage that patient through identification, whether it’s through direct to patient advertising or LungTrax Detect. These patients are identified. They need to be followed up and worked up. Lung Virtual Navigators can do that.

LungTrax Connect, an administrative sale, our ability to go in and talk to hospitals about passively screening patients that are already in their PACS system that have reimbursement, that are in these communities where these patients are literally suffocating right now with no options. So you have the ability to treat patients. It’s a good economic value proposition. Oh, and by the way, the downstream benefits of BLVR programs are significant. If If you look at Beth Israel Hospital at CHEST last year, put out a paper that showed seventy percent of the patients that came through their BLVR program, where they used upper valves, seventy percent of those patients came from outside of the network.

These patients come in with significant comorbidities. They’ve got coronary needs. They’ve got neuro needs. They’ve got orthopedic needs. So you’ve got this very highly comorbid patient population that’s coming through, and it speaks to the administrators in the hospital.

We’ll continue to bring on new accounts, and we report on that quarterly. Treating more patients is the leg of this stool. We’re doing this a number of different ways. we’ve got geographic expansion. China has become a large market for us.

It’s well, it’s a growing market for us, and we’ll continue to grow over time. We’ve got a great partnership. We were direct in China and signed a distribution agreement with a company, and they’ve been performing exceptionally well for So, China has been a a good market for us. I realize the the kind of the the juggling with the tariffs and and all that is, is something that people can be concerned about. We’ve spent a lot of time on it.

I’ve got good relationships with the people that are running this distributor, and they’ve been able to, effectively manage that. So we’re we feel good about our relationships there. From a Japanese standpoint, we are running a post approval study. So we have approval in Japan. We have reimbursement in Japan.

The Japanese government has asked us to treat 140 patients in a focused study to make sure that our any kind of complications in Japan are in line with what we’ve seen through the rest of the globe. Once we’ve done that 140 patients, we’ll be able to roll that out. We expect to roll out in Japan in 2026. Expect to complete enrollment in approximately 2026. AEROSEAL.

So I talked about I’ll get to that on an upcoming slide. So Aerocele, talked about this collateral ventilation, and we’ve got twenty percent of patients or twenty five percent of patients currently, they come in, they’ve gone through the workup process, they’re on the table, the doctor says, I’m going put you out. They put the scope in. The patient wakes up, and they’re told, Sorry. We couldn’t treat you.

You have collateral ventilation. Well, the solution for that is going to be AERISEAL. It’s not approved in The United States yet. It is approved outside The United States. We have European approval, our CE mark, on this.

So this will allow the patients to go the physicians to go in with a polymeric foam and treat the area between the lobes where that leak exists. So they’ll put this foam in place, it will close down and seal up that area between the two lobes, and then thus make that patient ventilation negative. We did an initial trial on this, our convert data that was shown at ERS last year. We showed a seventy seven point six percent conversion rate. So we’ve shown that this can be effective.

The outcomes of those patients are extremely good as well. So we don’t see a difference, a significant difference in the outcomes of those patients that actually undergo the trial, receive ARISEAL, and then get valves afterwards. Again, we expect to this is a two hundred patient IDE that we’re doing right now. We’re doing this both in Europe, Australia, and The United States, and expect to complete enrollment in approximately 2026. We’ve got a six month follow-up on it, and then we’ll submit and expect to get a PMA in the timing thereafter.

Actually, before I go on, just another thing to note about this. We’ve talked about this being a TAM expander of 20%, but imagine you’ve got a patient that’s actually on the table that’s gone through all the workup, you’ve gone through the hurdles of getting that patient there, and all of a sudden, they’re on that table and you just consent them. You say, We’re either going give you Aerosene or you’re going get valves. Hopefully we’re going to give you valves. But if you have collateral ventilation, we’re going to need to give you Aerosil.

We’ll bring you back in a few months to get your valves. So that patient is not going to wake up having not had anything done in most instances. That is a big, big lift. If there’s twenty five percent of these patients that currently can’t get treated, that have gone through the whole process, our ability to actually provide that treatment is not only a benefit for them, it’s an additional procedure for the hospital. It’s additional valves, so everybody benefits there.

But also, if you think of the referring physician who referred this patient in, if they’ve got this cycle of patients that are coming back that did not receive treatment, that stops. Those patients will receive treatment. So I think there’s excitement across the board on that. Next, I talked about Lung Tracks Detect. This is really how it works.

So we’ve got lung cancer screening, non contrast chest CTs are done. Those scans sit in the PACS system. They’re in the hospital PACS system. There’s an on premise gateway that we use, AMBRA, which is the majority of our hospitals actually have a gateway through AMBRA. We run the PACS images through this gateway.

It goes through a cloud based analysis using AI, and we look to find exactly what that destruction score level is depending on what the physician sets. So they can set it at nine ten, nine fifty household units, and that’s emphysema destruction thresholds. And what happens from that is that these patients are identified and come back in a workflow like you can see here on the slide where it says this is the destruction score. This patient has radiographic emphysema. They should be followed up.

You then have a nurse coordinator or nurse navigator, patient coordinator that will go in and look at these patients and say, okay, does this patient really qualify? Well, this patient’s still smoking. We’re not going to put valves in a patient that’s still smoking. Many Many people feel that way. So they would exclude that patient.

This patient maybe doesn’t have they’re 112 years old. They’re in the ICU. They’re not going to be a valve candidate. So we’ll cross them off. But this patient’s a 57 year old, relatively healthy smoker, send to Stratix.

So they push the button that then sends this patient’s CT scan off to Stratix and comes back with a low bar report that shows where that patient would benefit most. We’re really excited about this. We launched this broadly in February of this year at our national sales meeting, well, at the January, but really more broadly in February. We’ve seen significant excitement and interest in it, especially with the number of lung nodule programs that are out there, and we’ve begun talking not just about lung nodules or lung cancer screening, but lung health. Patients don’t want to go in for lung cancer screening because they might find out that they have lung cancer.

But a lung health screening is different. I’m going go in and I’m going to have my lung health checked. If you go in for a colonoscopy, you don’t go in for a colon cancer screening, you go in for a colonoscopy where they’re looking at your colon for any issues that might be there. Well, why wouldn’t lungs be any different? So the idea of these lung health programs is one that’s resonating with a number of our customers right now.

This is a key portion of that. Let’s take the customers and passively identify the patients that are already in your network, that we already have relationships, that are in the EMR, and identify them and get them worked up for a treatment that’s right underneath our roof. So we see a future where that’s commonplace. And you’ve got all these patients that are out there. As I talked about the TAM, there’s these patients are out there.

They’re looking for help. I mentioned 56,000 last year. We’ll find more than 70,000 will either come on to our website and take a quiz or call into the phone, our helpline. 70,000 patients this year will call in. We want to send them to community lung specialists that understand emphysema screening.

They’ll do CT scans. We’ll also look at emphysema screening programs through PFT labs, build in workflow automation, make the workup more efficient, get them to procedure planning, and then those patients either go to Zephyr Valves, Araceal or other procedures they can optimize. Our numbers. Last year, we grew 22%. In Q1, we grew just over 20% on revenue of $22,500,000 Our U.

S. Revenue is $14,200,000 OUS was 8,300,000.0 Our margins are 73%. Our guidance this year is for 74% margins. And guidance on revenue is 96,000,000 to $98,000,000 Our cash position, which we get asked about often, is $88,700,000 in cash and cash equivalents. Our spend is approximately $30,000,000 So those are our financials.

If you look at our investment highlights one last time, big market, good reimbursement or broadly reimbursed, broadly accepted. We are the standard of care, Grade A evidence with over 40,000 patients treated. We’ve got a pipeline of products, pipeline of clinical trials that are coming out. We’ve got a great team that’s been doing this for a long time. Good, strong clinical results that continue to improve.

You’ll see at all these shows where our abstracts continue to come out and publications just continue to flow out in this space. And we’ve got a proprietary patient selection technology that we’re very, very proud of and excited about. So that’s that’s Pulmonics. Thank you all for attending. I appreciate

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