Alimera Sciences, Inc.

Ladies and gentlemen, thank you for standing by. Good morning and welcome to the Alamara Sciences fourth quarter and fiscal year 2023 financial results and corporate update conference call. At this time, all participants are 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 telephone keypad. To withdraw your question, please press star then 2. Participants on this call are advised that audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call through June 7, 2024. I would now like to turn the call over to Scott Gordon of CoreIR, the company's investor relations firm. Please go ahead, sir.

Thank you, Scott. Good morning, and thank you for participating in today's conference call. Joining me from Alamara's leadership team are Rick Eiswert, President, Chief Executive Officer, and Elliot Maltz, Chief Financial Officer, and Todd Wood will be joining us, President, UBS Operations, in the question and answer session today. During this call, management will be making forward-looking statements, including statements that address Alamara's expectations for future performance or operational results future financial position, outlook and guidance, and timeline for achieving positive cash flow. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the risk factors described in Alamara's most recently filed periodic reports on 410Q, will form 8K filed with the SEC today and form 10K to be filed with the SEC from the year end of December 31, 2023, as well as Alamira's press release that accompanies this call, particularly the cautionary statements in it. Today's conference call will include references to adjusted EBITDA, which is a non-GAAP financial measure. Please see the explanatory language and reconciliation table located in Alamira's earnings press release. The content of this call contains time-sensitive information that is accurate only as of today, March 7, 2024. Except as required by law, Alameda disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Rick Eisler. Rick, please go ahead.

Thank you, Scott, and good morning to everyone on the calls. 2023 was a pivotal year for Alamira. We exited 2023 much stronger than we came into it. In 2023, we accomplished many goals. We completed a strategic and transformative transaction to obtain the commercial rights critique and expand our product portfolio. We strengthened our balance sheet and simplified our capital structure. We established the critical mass to drive positive adjusted EBITDA moving forward, as well as operating cash flow in 2024. We expanded our commercial team to drive growth and utilization of both products. And we completed the enrollment in both our two Phase 4 clinical studies, New Day and Synchronicity, that we expect will drive increased utilization of both Alluvian and UTEEQ in future years. As we head into 2024, we see the benefits of these transactions that we completed in 2023. We acquired UTEEQ to consolidate the rights to the flucinolone and setinide in-plant technology in the U.S., and expand the indications available for us to serve patients with retinal conditions. Now that we have both Alluvian and Utique in the U.S., we believe that there is significant opportunity to increase their utilization. In 2023, we learned that fewer than 30% of legacy Alluvian and Utique accounts utilize both products. With our expanded sales force selling Alluvian and Utique in the U.S., and our marketing of the two indications as the same long-term, consistently delivered, low-dose technology provides durability that both our physicians and patients want today in a product. We believe the opportunity to allow physicians to treat a broader array of patients is tremendous. We spent the back half of the year incorporating UT into our U.S. business, training our commercial team to sell both products and promote both indications. We made significant progress with utilization of our products and the second half of 2023 up 9% over the second half of 2022 on a pro-clima basis. With the acquisition of UT and the continued growth of Alluvium globally, our financial results have improved significantly in 2023. In Q4, our consolidated global net revenue grew 88% over Q4 of 2022 to $26.3 million. And for the year, our net revenue grew 49% over the full year of 2022 to $8.8 million. Importantly, as we projected, we are driving positive adjusted EBITDA in cash flow from operations now that we have critical mass with a larger portfolio. Our adjusted EBITDA in the fourth quarter was $5 million, a significant improvement over Q4 2022 when we had an adjusted EBITDA loss of $1.2 million. For the full year of 2023, we delivered positive adjusted EBITDA of $8.7 million, compared to a loss of $7.9 million in 2022. In our U.S. segment, net revenue in Q4 2023 increased 104% to $19.2 million versus $9.4 million in Q4 of 2022. This contributed to a 66% increase in U.S. revenue for the full year of 2023 to $56.7 million. U.S. end-user demand for our products was up 4.4% in Q4 versus the prior year and 11% on a pro-forma basis for the full year. Although we have made great commercial strides with the integration of UT and the UBI syndication, we believe we still have a significant opportunity ahead of us to maximize the benefits of selling two high-priority products. To help accelerate growth in 2024, Todd Wood joined our team in December as president of our U.S. operations. tottering the wealth of experience with the successful brands such as Botox and Lumigan, and will be joining us on the call for the Q&A session. We believe our international business, where Illuvium has both indications under one brand, is a great leading indicator of what is possible in the U.S. Our international business grew significantly in both Q4 and for the full year. In Q4 2023, international net revenue grew 54% to $7.1 million. and for the full year, net revenue was up 21% to $24 million. We experienced a 16.7% end-user demand growth in Q4 and 11.8% for the full year in the international segment, driven by increasing end-user demand in our markets of the UK, Portugal, Ireland, Spain, and France. Revenue from our distributor partners was also up for both the quarter and the full year. However, due to limited supply capacity, we were not able to fulfill all of the end user demand in the second half of the year after being up over 30% through the end of the second quarter. Moving into 2024, we believe we will no longer be faced with these supply issues. In Q4, Jason Warner joined our team as Chief Operating Officer, and we have made and continue to make additional investments to ensure available manufacturing capacity moving forward. As a result, We made significant distributor shipments in the fourth quarter of 2023 and anticipate meeting end-user demand in Europe in a timely manner moving forward. We expect the international business to continue to be a significant contributor to our growth, and we anticipate growing utilization of the UBI syndication in those markets as we introduce some of the positioning we have adopted following the acquisition of UT in the U.S. When Jason joined us, I was pleased to name Dr. Philip Ashton, who has been with us the past 10 years, as the President of International Operations, allowing Philip to spend 100% of his time focused on execution and growth of the international segments, both on our direct markets of Germany, the UK, Portugal, and Ireland, but also in supporting our distributor partners throughout Europe and the Middle East. In February, we announced that the UK National Institute for Health and Care Excellence, or NICE, has issued final draft guidance recommending that chronic diabetic macular edema or DME patients with a natural lens, also known as phasic patients, have access to alluvium. NICE reimbursement to date has been limited to only pseudophatic patients, defined as those who had undergone cataract surgery, which is less than a third of the population. Now we have the potential to reach phasic patients who advanced to chronic DME, a significant expansion of our potential user base. We expect the availability of this wider reimbursement to positively impact utilization in the UK in the second half of 2024. This limitation has historically impacted reimbursement in other countries as well, such as Spain and Italy, which looked to the NICE guidance as a contributing factor in the reimbursement decisions. We believe that this NICE decision, if adopted in other markets, will broaden our potential patient base in these countries as well. In previous calls, I've shared that our goal for 2024 following the UT transaction was to achieve $100 million in consolidated revenue and annual EBITDA margin of 20%. As a result of our success in the second half of 2023, we are revising our financial guidance for 2024 revenue to exceed $105 million in revenue with an adjusted EBITDA margin of 20% for the year. We do expect our business to fluctuate quarter to quarter due to the seasonality of our business. Historically, we've seen lower revenue in Q1, primarily resulting from the new insurance year with the resetting of patient deductibles, which dampens utilization of high-priced products like aluminum boutique in January and February. Historically, Q1 revenue has been 10% to 15% below the previous quarter, and we would anticipate the same impact in Q1 of this year. Adjusted EBITDA will also fluctuate quarter to quarter as a result of this seasonality, but we are confident in our ability to deliver 20% margins annually. We are pleased to also have completed enrollment in two phase four studies that we believe will provide impactful data and drive increased physician utilization in the future. In June, we finished enrollment in our landmark New Day study with 306 patients. The New Day study is evaluating lupine's utility as early baseline therapy in naive or near-naive patients, and a head-to-head study versus the leading anti-VEGF in the treatment of diabetic macular edema. This study is the first head-to-head comparison of long-term low-dose corticosteroid therapy versus anti-VEGF therapy in the treatment of DME. And we believe that it's successful to change the treatment paradigm for DME by moving a long-acting steroid implant earlier in the patient journey. The last patient's last visit in this study is projected for Q4 of this year, and we anticipate having data in early 2025. In January, we announced the completion of enrollment in the Synchronicity Study, which is a prospective open-label clinical study evaluating the safety and efficacy of UT for the treatment of macular edema associated with chronic noninfectious uveitis affecting the posterior segment of the eye and related intraocular inflammation. This study's purpose is to gain broader insight into the use of UT by the general retina specialist in real-world clinical practice, as opposed to those who practice solely as UVI specialists in a trial. This is a two-year follow-up study with an interim top-line six-month efficacy readout anticipated in the second half of this year. And with that update, I will now turn the call over to Elliott to review our fourth quarter and fiscal year financial results in greater detail.