Axonics, Inc.

Gentlemen, and welcome to the Axonics second quarter 2021 results conference call. At this time, all participants are in a listen-only mode. Later, we will conduct question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star, then zero on your touchstone telephone. I would now like to turn the conference over to your host, Mr. Neil Baladkar. Please go ahead.

Thank you, Jerome. Good afternoon, and thank you for joining Exonix's quarterly results and update call. Presenting on today's call are Raymond Cohen, Chief Executive Officer, and Dan Deren, President and Chief Financial Officer. Ray and Dan will provide prepared remarks on second quarter financial results, commercial progress, and a general business update, followed by a Q&A session. Before we begin, I would like to remind listeners that statements made on this conference call that relate to future plans, events, prospects, or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. While these forward-looking statements are based on management's current expectations and beliefs, these statements are subject to a number of risks, uncertainties, assumptions, and other factors that could cause results to differ materially from the expectations expressed on this conference call. These risks and uncertainties are disclosed in more detail in Axonics' filings with the Securities and Exchange Commission, all of which are available online at www.sec.gov. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today's date, August 5, 2021. Except as required by law, Axonics undertakes no obligation to update or revise any forward-looking statements to reflect new information, circumstances, or unanticipated events that may arise. I would now like to turn the call over to Ray for his remarks. Ray Haynes Thank you, Neil.

I'd like to welcome everyone joining the conference call this afternoon. In the second quarter of 2021, I am proud to report that we exceeded our commercial objectives and made important progress on several other key initiatives. Starting off with our commercial results, Exonix generated record of $45.9 million in the second quarter, representing an increase of 33% on a sequential basis and over 200% increase as compared to last year's COVID-impacted second quarter. In cyclone modulation, we experienced strong momentum in the United States and generated record quarterly revenue of $40.2 million, and this was up from $33 million in Q1 of this year. We continue to add new customers, and we're also seeing growth within our existing base of implanting physicians who are performing more procedures than they have in the past, given the return of a more normalized elective procedure environment and the overall expansion in the sequenomodulation market. As we have discussed in the past, in each physician practice, there are hundreds of patients that have been differentially diagnosed with urinary fecal or mixed incontinence. Many of these patients have taken prescription drugs to treat overactive bladder with limited success. The clinical literature indicates that over 80% of patients who are prescribed drugs discontinue these medications within six months. Over the last two decades, millions of patients have been suffering in silence or simply decided not to pursue sacral modulation therapy due to the shortcomings of the legacy offering. Thankfully, this is changing. Due to our presence in the market, physicians are now discussing the benefits of sacramental modulation with their patients more often. The discussion now is less about whether the product is rechargeable or non-rechargeable. It's more about the longevity in the body and significant symptom relief that can be expected. The facts are that Exonix has made sacramental modulation an attractive therapy proposition. It is clinically proven with higher efficacy than ever seen in this category. It provides durable, long-lasting relief. It's easy to use, MRI-compatible, and very safe. Moreover, we are working diligently with physicians to increase awareness among patients via our DTC and marketing efforts. As a result, there is little doubt that the sacromodulation market is growing, and exonics has been cause in the matter. Turning to Bulkamet. We generated $5.7 million of revenue in the first full quarter since acquiring the product on the last day of February. Physician response to the product is overwhelmingly positive, and the expanding offering has elevated Exonix's stature within the urology and urogynecology community. Clinicians are enthusiastic to offer this safe, efficacious, long-lasting, best-in-class bulking agent to the large and rather under-penetrated population of women suffering from stress and mixed urinary incontinence. And as hypothesized, BocaMed is opening doors, providing exonics with an opportunity to sell more sequenomodulation. We are already seeing physicians who, for one reason or another, didn't come our way in the last 18 months, now giving us a chance to demonstrate the superior clinical results of our S&M product and the mission-driven dedication and high-quality service of our field-based team. Now, during the second quarter, we trained our entire U.S. field team on BulkMed, and we are now executing a broad rollout to physicians across the United States. We scheduled five regional seminars this summer to introduce physicians to BulkMed and provide proctored wet lab training. Physician interest was such that the five seminars were fully booked in one week, and we recently added and filled a sixth seminar all in one day. We have already hosted two of these seminars in July with the third program scheduled for this weekend. The excitement and positive feedback from attendees is phenomenal. In all, we expect to train over 350 physicians on BulkMed at these seminars. These seminars also provide us with an opportunity to introduce our saquenomodulation system to physicians who are less familiar with exonics and have them hear firsthand from colleagues who have already experienced the difference of working with Exonix. Now looking ahead, based on our strong commercial momentum, we are increasing our calendar year 2021 revenue guidance to a range of $186 to $188 million. Compared to our prior guidance, this is a $9 million increase at the midpoint and implies growth of approximately 68% on a year-over-year basis. Now, Dan will provide further details on our updated guidance in his prepared remarks, but I'd like to talk a little bit about our clinical and regulatory situation. It's notable that we've received two regulatory approvals during the quarter and also made a submission to the FDA for our long-lived non-rechargeable implantable stimulator. So to provide some more details, In mid-May, we received CE mark approval to market our second generation rechargeable implantable device and an updated patient remote control in Europe. You may recall that we previously received FDA approval for this particular IPG and remote control during 2020. Now, this version reduces how frequently a patient needs to recharge their cyclone modulation device to just once a month for approximately one hour. Now, also in mid-May, we received FDA approval allowing the use of detachable extremity coils for patients undergoing 1.5T or 3T MRI scans. Now, you may additionally recall that the FDA previously approved both 1.5 and 3T MRI conditional labeling for us using head and full body transmit coils. So with this additional approval for these extremity coils, Exonix now offers the widest range of FDA-approved MRI conditions in sequinal modulation. Notably, we have also surpassed the MRI conditions allowed for products in the spinal cord stimulation market. And in late June, we filed a PMA supplement with the FDA for our newly developed, long-lived, non-rechargeable, or recharge-free sequinal modulation system. Now, we designed this new implantable device to replicate the key features of our currently marketed FDA-approved rechargeable system. Once approved, the new Exonic system will be the first fully recharge-free S&M system, and it will have the following attributes. One, a primary cell battery with an expected life of at least 10 years, which is approximately two and a half times longer lived than the legacy offering from Medtronic. The device will be relatively small and thin, and it will measure only 11 CCs in volume. It will include the benefits of constant current stimulation, and it has an intuitive, easy-to-use, recharge-free patient remote control. And lastly, it will be born with full-body MRI compatibility with both 1.5 and 3T scanners. Now, we anticipate receiving FDA approval during the first half of 2022, at which time we expect to begin shipping the new product to customers in the United States. Now, we're confident that the introduction of our new non-rechargeable device will continue to drive market expansion and will also advance us on our path to synchronoid modulation market leadership. As I trust you can tell, we've had a very busy and incredibly productive second quarter of 2021. And with that, I'd like to turn the call over to Dan to review Exonix's second quarter 2021 financial results. Dan?