Anika Therapeutics Inc.

Good morning, ladies and gentlemen, and welcome to Anika's third quarter earnings conference call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. I will now turn the call over to Matt Hall, Director, Corporate Development and Investor Relations. Please proceed.

Good morning, and thank you for joining us for Anika's third quarter 2025 conference call and webcast. I'm Matt Hall, Anika's Director of Corporate Development and Investor Relations. Our earnings press release was issued earlier this morning and is available on our Investor Relations website at www.anika.com, as are the supplementary PowerPoint slides that will be used for the discussion today. With me on the call today are Dr. Cheryl Blanchard, President and Chief Executive Officer, and Steve Griffin, Executive Vice President, Chief Financial Officer, and Chief Operating Officer, who will present our third quarter 2025 financial results and business highlights. Please take a moment and open the slide presentation and refer to slide number two. Before we begin, please understand that certain statements made during the call today constitute forward-looking statements as defined in the Securities Exchange Act of 1934. These statements are based on our current beliefs and expectations and are subject to certain risks and uncertainties. The company's actual results could differ materially from any anticipated future results, performance, or achievements. We make no obligation to update these statements should future financial data or events occur that differ from the forward-looking statements presented today. Please also see our most recent SEC filings for more information about risk factors that could affect our performance. In addition, during the call, we may refer to several adjusted or non-GAAP financial measures, which may include adjusted EBITDA, adjusted net income from continuing operations, and adjusted earnings per share from continuing operations, which are used in addition to results presented in accordance with GAAP financial measures. We believe that non-GAAP measures provide an additional way of viewing aspects of our operations and performance. But when considered with GAAP financial measures and the reconciliation of GAAP measures, they provided even more complete understanding of our business. A reconciliation of these adjusted non-GAAP financial results to the most comparable GAAP measurements are available at the end of the presentation slide deck and our third quarter 2025 press release. And now, I'd like to turn the call over to our President and CEO, Dr. Cheryl Blanchard. Cheryl?

Thanks, Matt. Good morning, everyone, and thanks for joining us today to discuss ANACA's third quarter 2025 results. Please turn to slide three. This quarter reflects strong execution across our strategic priorities, including robust commercial channel revenue growth, completing the filing of the third and final PMA module for HylaFAST, and continued progress toward completing the final requirements needed to file the Singall NDA. I'll start out by walking you through the financial results for the quarter, which are in line with expectations, while also generating strong operating cash flow and positive adjusted EBITDA. Revenue for the quarter was down 6% compared to the same period last year, as expected, as Johnson & Johnson continues efforts to stabilize pricing in our important and profitable US OA pain management business, which accounts for the majority of our OEM channel revenue. As a note, J&J announced their intent to separate their orthopedic business to enhance strategic and operational focus. We do not anticipate any negative impact to our OA pain management business related to that separation. And in fact, after the quarter, J&J MedTech exercised its option to extend the current license and supply agreement for Monovisc for another five-year term through December 2031. The expected results from our OEM channel were offset by strong continued momentum in our commercial channel, where we delivered double-digit growth in the quarter, advancing our strategic priorities while moving HyloFast and Syngal closer to FDA approval and launch. Commercial channel revenue grew 22%, fueled by strong integrity growth, continued growth of HyloFast outside the US, and international growth in OA pain management. Additionally, the steps we've taken to improve our cost structure is flowing through, with SG&A expenses down 12% year-over-year and overall operating expenses down 3%, driving improved profitability and free cash flow. Turning to our commercial channel portfolio, integrity procedures in the U.S. grew for the sixth consecutive quarter, driving regenerative solutions growth of 25% year-over-year. Integrity growth is outpacing the overall U.S. soft tissue augmentation market, keeping us on track to more than double integrity procedures and revenue in 2025 compared to last year. As shown on slide four, about 500 integrity procedures were performed during the quarter, bringing our number of surgeon users to nearly 300. Our US commercial team remains focused on expanding adoption and repeat use, supporting existing users as they integrate integrity more fully into their practice while also training new surgeons on its safe and effective use. Notably, over 60% of users have completed multiple cases, a strong indicator of growing and sustained clinical confidence. We are also excited that we've started limited launches of Integrity outside the U.S. and cases have been performed in 10 countries. This growing base of experienced users demonstrates sustained clinical confidence and adoption of this game-changing technology that offers both enhanced regenerative capacity and greater strength when compared to competitive products. During the quarter, we also initiated the limited release of the first skew of the larger shapes and sizes of Integrity, designed for a variety of tendon applications, including in the hip, knee, and foot and ankle. A number of surgeries have been performed, and the initial feedback from surgeons has been positive. Additional SKUs of shapes and sizes that are designed for more specific tendon augmentation applications will be released in the coming quarters. We expect these additions to further accelerate adoption and support continued commercial momentum into 2026. Also contributing to our commercial channel growth was the continued success of our international team, driving hyalofast expansion and delivering double-digit gains in international OA pain management revenue. The team partnered closely with distributors to strengthen business in existing markets and expand into new geographies. International OA pain management revenue grew 21% year over year, primarily driven by the timing of distributor orders. Year to date, that business is up 6% compared to 2024. This successful quarter for our international business was underscored by a major milestone. We have now surpassed sales of 1 million Syngal injections since the 2016 launch. The strong uptake of Syngal outside the U.S. is a testament to its effectiveness to relieve both short and long-term pain and get patients back to active living. Turning to Hylafast, on October 31st, we submitted the third and final module of our PMA to the FDA, marking a major milestone in our U.S. regulatory pathway for our breakthrough cartilage repair device. We look forward to engaging with the agency to progress toward U.S. approval and commercialization. Concurrent with earnings, we have also released the data from our U.S. Phase III FAST-TRACK study. As previously reported, while HyloFast consistently demonstrated improvements in pain and function, the study did not meet its two co-primary endpoints under the original statistical framework. This was in part due to a disproportionate amount of missing data in the microfracture active control arm. While Hyalofast showed clinically meaningful improvements in both CUS pain and IKDC function from baseline at 24 months, it was not statistically significant when compared to the active microfracture control arm. Statistically significant improvements were achieved in relevant key secondary endpoints, including CUS sports and recreation function, quality of life, and total COOS, all of which have been used as the basis for FDA approvals of other cartilage repair products. In addition, because the data was not normal and not missing at random, as assumed in the predefined statistical analysis plan, supplemental statistical analyses were prepared for FDA consideration. These analyses include a review of observed data, which is the data without statistical imputations, In the observed data analysis, we achieved significance for Coos pain. The post-hoc analysis also included responder analyses for several outcome measures. Our responder analysis provides the number of patients in the study who achieved a clinically meaningful level of improvement. In the FAST-TRACK study, more HyloFast patients achieved higher levels of improvement in pain at 24 months than microfracture patients did, and with statistical significance. We believe these additional analyses confirm the consistent and meaningful clinical benefit that Hyalofast with BMAC brings to patients with cartilage defects. We're encouraged by the strength and consistency of the data we have submitted to the FDA, both from the FAST-TRACK study and the over 15 years of independent clinical experience outside the U.S. The international experience continues to demonstrate Hyalofast's safety and efficacy across a broad range of patients with over 35,000 treated to date as we continue to see strong penetration of Hyalofast in the over 35 markets where it is sold today. Now turning to Syngal, our next generation OA pain management product. During the quarter, we made meaningful progress toward our US NDA submission. We successfully completed the first of two toxicity studies and initiated patient screening for the bioequivalent study, which remains on track to begin before the end of the year. As a reminder, these studies represent the final steps required for our NDA filing. We're encouraged by our continued progress with this important program and remain focused on advancing Singal toward regulatory submission and ultimately commercial availability in the U.S. market. Lastly, beginning in 2023, the company undertook a comprehensive strategic review, evaluating a broad range of alternatives. We have formally concluded that process and remain focused on executing our product growth strategy and enhancing operational performance to create shareholder value and return capital. As part of that commitment, we are commencing a second $15 million share repurchase under our previously announced program. We continue to prioritize key growth and regulatory milestones, including growing integrity, engaging with the FDA on the HyloFast PMA submission, completing the Syngal Bioequivalence Study and subsequent NDA submission, and delivering ongoing operational improvements aimed at strengthening profitability and cash flow. And with that, I'll now turn the call over to Steve for a detailed review of our financial results.