Myomo Inc.

Good day and welcome to the MIMO fourth quarter 2023 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Kim Golodets. Please go ahead.

Thank you, operator, and good afternoon, everyone. This is Kim Golodets with LHA. Welcome to the MIOMA fourth quarter 2023 conference call. Earlier this afternoon, MIOMA issued a news release announcing financial results for the three months and year ended December 31st, 2023. If you would like to be added to the company's email list, the company's email distribution list to receive future announcements, please register on the company's website at myoma.com or call LHA at 212-838-3777 and speak with Carolyn Curran. With me on today's call from Myoma are Paul Godona, Chief Executive Officer, and Dave Henry, Chief Financial Officer. Before we begin, I'd like to caution listeners that statements made during this conference call by management other than historical facts are forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, outlook, confidence, target, project, and other similar expressions are typically used to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and may involve and are subject to certain risks and uncertainties and other factors that may affect MIOMA's business, financial condition, and operating results. These and additional risks, uncertainties, and other factors are discussed in MIOMA's filings with the Securities and Exchange Commission, including the Form 10-K for the year ended December 31, 2023, and subsequent filings. Actual outcomes and results may differ materially from what's expressed in or implied by these forward-looking statements. Except as required by law, MIOMA undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. It is now my pleasure to turn the call over to MIOMA CEO, Paul Godonas. Paul, please go ahead.

Thanks, Kim. Well, good afternoon, everyone, and thank you for joining us. Since we announced some very positive developments with CMS last week, I'll start today's call by discussing the new MyoPro pricing for patients covered by Medicare Part B. Then we'll review our operational results for the fourth quarter and calendar year 2023. Last week, the Centers for Medicare and Medicaid Services, or CMS, finalized the pricing for the MyoPro product line, which will go into effect for deliveries as of April 1st of this year. We issued a press release on March 1st with details of the pricing and a link to the CMS document describing the rationale. The MyoPro Model G, which is coded as L8702, is to be reimbursed with a lump sum payment of $65,872. And the MyoPro Model W, which is coded as L8701, is to be reimbursed with a lump sum payment of $33,481. The Model G, which includes the elbow, wrist, and grasp function, represents more than 90% of our unit volume for sales directly to patients and to orthotics and prosthetics clinics. These amounts are slightly higher than what CMS proposed back in November as they added the Medicare inflation factor for the current year to their calculations. These amounts are the average fee to be paid by Medicare for MyoPro, and CMS will publish a more detailed fee schedule that describes the pricing for various state locations based on local cost factors. It's been a long journey to reach this point where we can serve patients with arm paralysis who are covered by Medicare Part B health insurance, and we're delighted that we've arrived. Achieving this milestone is a transformational moment for patients and the company that opens up a new world for these stroke survivors and others who've been told we'll never be able to use your arm or hand again for the rest of your life. We testified at the CMS public hearing in June 2022 that the MyoPro should be correctly classified in the brace category and not as a durable medical equipment rental item like a wheelchair. And after a rulemaking procedure, CMS agreed with us and announced in 2023 that the MyoPro as a custom fabricated brace for long-term use in the home should be included in the expanded definition of the brace category. A year ago, we met with the D&D MAC medical directors and shared our research about the valuable outcomes that were achieved by Medicare-age beneficiaries, and we were encouraged to deliver MyoPros to this population and then submit claims. To date, we've had over 20 claims paid by Medicare, some as a rental, the rest as long-sum from deliveries after January 1st, where the patient's physician has ordered the device and where medical necessity for the MyoPro has been established. This was the first time that Medicare paid for MyoPro braces for seniors with standard Part B coverage. And while some of these payments from several regional maps was significantly less than the new fee, we expect to be paid the correct amount for new deliveries after April 1st. Then in November 2023, CMS published its proposed pricing for the MyoPro billing codes as part of its semi-annual HCPCS public meeting. And last week's publication of the finalized fees is the culmination of this process so we can confidently go forward to meet the medical needs of Part B patient population. We commend CMS on making these ways available to seniors with Part B coverage, and it's also a major step towards the goal of health equity. So during the fourth quarter, we could tell Part B patient candidates that they were eligible for a MyoPro if they were medically qualified and had a doctor's order with supporting medical documentation to warrant a MyoPro arm break. We began shifting our clinical resources to evaluate, engage with these candidates, and had approximately 150 Medicare Part B patients in our patient pipeline as of December 31, 2023. Overall, we grew our pipeline to more than 1,000 patients by the end of the year, and our backlog, which includes Medicare Part B patients awaiting delivery of their device, grew to 230 units, which is up 40% from the end of 2022. and with the Medicare Part B patients now eligible for MyoPro, we had a record 183 authorizations and orders in the fourth quarter, up 87% from the same period a year ago. Dave Henry, our CFO, will go over these financial details in a few minutes. When we entered 2023, we didn't know if and when Medicare reclassified the MyoPro as a powered arm brace. We didn't know if the medical directors would approve coverage for Part B beneficiaries, and we didn't know how much they would reimburse for the devices. So at that time, we decided to focus on the reliable payers, such as certain Medicare Advantage plans, and reduce our cash burden during the year while waiting for these decisions. We took down our headcount by 12% early in the year and reduced our advertising expenses by nearly $1 million, and yet we still drew our product revenues by 20% year over year. We added license revenue from our China joint venture, and we cut our cash use and operations by nearly 40% down to $6.2 million for the year from over $10 million in the year before. We delivered over 400 MyoPros to patients in the U.S., Germany, and several international markets last year, and we became more efficient with our marketing, reducing the cost for pipeline ad while operating with fewer staff members. Overall, we achieved more than $19 million in revenue in 2023, our 11th consecutive year of revenue growth. I'll now turn it over to Dave for a detailed financial review of the quarter and our 2024 outlook, and I'll come back to outline our operational plans for the rest of this year.