Biofrontera Inc.

Good morning, everyone, and welcome to the BioFrontera Inc. second quarter 2023 financial results and business 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 prepared remarks, there will be an opportunity to ask questions. To ask a question, you may press star and then one on your telephone keypad. To draw your questions, you may press star and two. Please also note today's event is being recorded, and at this time I'd like to turn the floor over to Tirth Patel with LHA Investor Relations. Please go ahead.

Good morning, and welcome to BioFrontera, Inc.' 's second quarter 2023 financial results and business update conference call. Please note that certain information discussed during today's call by management is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that BioFrontier's management will be making forward-looking statements and that actual results may differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. All risks and uncertainties are detailed in and are qualified by the cautionary statements contained in BioFrontier's press releases and SEC filings. Also, this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, August 11th, 2023. Biofrontera undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as required by law. During today's call, there will be references to certain non-GAAP financial measures. Biofrontera believes these measures provide useful information for investors, yet should not be considered as a substitute for GAAP nor should they be viewed as a substitute for operating results determined in accordance with GAAP. A reconciliation of non-GAAP to GAAP results is included in this morning's press release. More specifically, management will be referring to adjusted EBITDA, a non-GAAP financial measure defined as net income or loss, excluding interest, income and expense, income taxes, depreciation and amortization, and certain other non-recurring or non-cash items. With that, I would now like to turn the call over to Hermann Lubert, CEO, Chairman, and Founder of Biofrontera. Hermann?

Yeah, thank you, Teroth, and my thanks to everyone joining us this morning. On today's call, I'll provide an overview of our growth strategy and our accomplishments during the second quarter that helps lay the groundwork for many value-driving initiatives. Fred Leffler, our CFO, will follow with a discussion on financial results, and then both of us will be available to answer questions. Starting with the business update, we have made tremendous progress across three critical areas, including expanding our sales force, optimizing our cost structure, and advancing R&D and clinical initiatives. Regarding sales, I would like to commend the team as we announced net revenue of $5.8 million, a 31% increase for the quarter year over year. While Amelus makes up the vast majority of the revenue, we are proud to also share that 55 BF Rodolet lamps were placed at physician offices during the quarter, more than twice the number a year ago. The growing number of lamps in the field reflects both first-term installations and adding lamps among dermatologists already familiar with Amelus PDT. More specifically, of the 55 installations, approximately 20 sites already had one lamp in place and bought a second lamp to provide more Amelus PDT to their patients. The remaining about 35 offices are now set up to start Amelus BF Rodolet PDT. Clearly, LAMP placements are a proxy for future growth, and we are delighted with the increasing recognition of Amelus PDT as an effective and patient-friendly treatment for actinic keratosis. During last quarter's call, we introduced our strategy for growing the sales team. We have achieved our goal of reaching 40 members. Subsequent to growing the sales force, we have also grown the medical and, with a new focus, reimbursement support. On today's call, I'll share some of the strategic shifts in our approach and how we intend to best utilize and support our sales force. To compensate for new strategic hirings, we have reduced the workforce in other parts of the business. Certain metropolitan regions have consistently shown high sales results and great potential. To maintain a leaner and more strategic path of optimizing for growth, we are adopting a more surgical approach to our sales strategy. We will be channeling more resources, both in terms of human capital and medical affairs and reimbursement support initiatives. into metropolitan sales territories that have demonstrated high revenue potential. This includes enhanced training for our existing sales teams in these areas, expanded marketing campaigns, and a potential increase in the number of sales representatives down the road. On the flip side, for regions that have been generating comparatively lower revenues and a lower return on invested assets, we have decided not to expand our sales teams or build out new territories. And in certain cases, we have redeployed those resources to areas with greater opportunity. This shift is being driven by data and optimizes our marketing stand. By being smarter and more intentional with our sales efforts, we are able to recalibrate our strategy if needed and ensure that we stay agile and responsive to market demands. By homing in on high-value metals, we can achieve better growth towards profitability. During Q2, we made the difficult decision to implement a small reduction in force. The reduction was centered primarily around roles less crucial to our current phase of growth. This decision was driven by the necessity to streamline our operations and to reduce costs. However, while we took a step back in certain areas, we simultaneously took two steps forward in others, such as bolstering higher revenue generating positions. By dialing in these adjustments, we have positioned BioFrontera to be leaner and more agile with a heightened focus on driving revenues. Let me turn now to the innovation and R&D taking place at BioFrontera. A key value driver is our portfolio of active label expansion studies for amylose. Just yesterday, we announced that enrollment of all 186 patients is now complete in the phase three clinical study evaluating amylose PDT in combination with BF-Rodolat for the treatment of superficial basal cell carcinoma, or SBCC. Approximately two-thirds of non-melanoma skin cancer cases in the U.S. are BCC, leading to a significant unmet medical need for more effective, less invasive, and cost-efficient therapies that treat BCC as well as underlying pre-malignancies without ionizing radiation. We look forward to sharing results from this phase three study in mid-2024. Adding SBCC to the label of Amelus will allow doctors, in addition to treating individual SBCC lesions, to include these lesions into the treatment of larger sun-damaged fields with Amelus BF-Rodolat PDT as it is currently approved for actinic keratosis. It is the next logical step in our goal to offer one field-directed treatment for all sun-induced neoplastic damage in larger skin areas. Regarding expanding the amyloose label within actinic keratosis, there is a large and growing demand for a highly effective therapy to treat AK beyond the face and scalp. We have an ongoing phase three study evaluating the use of amyloose PDT in the extremities, neck, and trunk currently enrolling. and have dosed 58 patients across 10 centers. We aim to enroll a total of 156 subjects stratified by body region. Lastly, after the final patient completed the clinical phase of the study, we are currently analyzing results from our open-label multi-center phase one safety and tolerability study, investigating three tubes of amulose per treatment. This safety study has the potential to be the final study required for FDA approval for the three-tube treatment. Results will be available very soon as we remain on track for an FDA submission before year end. As most of you are aware, our PDT lamps, BF Rodolat and Rodolat XL, are remarkable solutions in dermatology and the only red lights approved by the FDA for use in photodynamic therapy. However, the current infrastructure for PDT is mostly fixed and limited to dermatology clinics or specialized facilities. Recognizing the constraints posed by the stationary nature of current PDT labs and the growing demand for flexibility and treatment locations, In June, we have announced the inquiry of two granted US patents and the engagement of a contract manufacturer to develop a new, low-cost, portable PDT lamp. The prototype is now under development and aims to deliver the quality of the Rodolet lamps in a new and more accessible form, designed with both the physician and the patient in mind. The lamp is designed to be compact and lightweight, enabling easy storage and allowing clinicians to bring the lamp to the patient. Its portability allows it to be an option at physicians' offices with space constraints, for mobile dermatology clinics, and for reaching remote or underserved areas. A portable lamp will furthermore expand our reach to more dermatologists and more offices. From a sales perspective, it allows our sales team to give live demonstrations at physician offices. Being portable, a lamp can be transported in the back of a car or be presented easily at conferences. Our portable PDT lamp embodies BioFrontera's commitment to innovative solutions that prioritize care and expand access. I look forward to keeping you updated during the development process. As final example of our commitment to patient care and innovation, during the second quarter, we were granted a new patent related to a PDG protocol that is expected to be less painful but equally as effective. With an incubation between application of the gel with exposure to light, with a wavelength spectrum similar to sunlight, followed by 10 minutes of red light illumination, this novel protocol is far more patient-friendly. This is the fourth patent protecting Amalus granted by the U.S. Patent Office in the last 18 months, and it expires in April 2039. Friendlier protocols will help to enable high-efficacy PDT for more patients. and R&D will boost access to PDT. We look forward to providing updates on all these programs and more later this year. With that, I turn the call over to Fred to walk through the financial details of the quarter. Fred?