INVO BioScience, Inc.

And welcome to the INFO Biosciences Report's fourth quarter and fiscal year 2021 financial results conference call. All participants will be in 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 two. Please note this event is being recorded. I would now like to turn the conference over to Robert Bloom with Liz and Partners. Please go ahead.

All right. Thank you very much, Sarah. And good afternoon, everyone. Thank you all for joining us today for InvoBioScience's fourth quarter and fiscal year 2021 financial results conference call. Joining us on today's call from the company is InvoBioScience's chief executive officer, Mr. Steve Shum. the company's Chief Operating Officer and Vice President of Business Development, Mike Campbell, and Andrea Gorin, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question and answer session. Before we begin with the event, we submit for the record the following statement. Certain matters discussed on this conference call may, by the management of InvoBioscience, may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, Section 21E of the Securities Exchange Act of 1934 as amended, and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements regarding the company's expected future financial position, results of operations, cash flows, financing plans, business strategies, products and services, Competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as anticipate, if, believe, plan, estimate, expect, intend, may, could, should, will, and other similar expressions are forward-looking statements. All forward-looking statements involve risks and uncertainties and contingencies, many of which are beyond the company's control, which may cause actual results, performance, or achievements that to differ materially from anticipated results, performance, or achievements. Factors that may cause extra results to differ materially from those in the forward-looking statements include those set forth in the company's filings, www.sec.gov. The company is under no obligation and expressly disclaims any such obligation to update or alter forward-looking statements, whether the result of the receipt of information, future events, or otherwise. With that said, let me turn the call over to Steve Shum, Chief Executive Officer of InvoBioscience. Steve, please proceed.

Thank you, Robert, and welcome, everyone. We filed the annual 10-K just prior to this call starting, but I also want to note that we filed an 8-K just now as well to both publish the news release but also publish a presentation focused specifically on our InvoCenter efforts in order to provide added details around how we are approaching this area of commercialization and some of our high-level goals and objectives. We prepared this targeted review because the InvoCenters represent such a critical part of our go-forward strategy now. That short summary presentation is also now posted on our website under the investor section and we will cover aspects of it here on this call. We also believe it will answer some of the questions that many of you often ask regarding this effort. So we encourage everyone to take a look at that additional presentation when you have a chance. And of course we will periodically update it as developments occur. Moving to our annual review and outlook. Let me first state just how important and exciting 2021 was for the company, particularly the resulting progress and developments toward the end of the year. As a reminder, and I know we stress this frequently from a market strategy perspective, our commercialization efforts continue to focus on the substantial underserved patient population and on expanding access to advanced fertility treatment for those people. We believe InvoCell and IVC can help address the key challenges of affordability and capacity in order to help provide care to the vast number of patients that go untreated every year. As one of our key objectives, we set out to develop an entirely new commercial pathway for our solution by opening jointly owned fertility centers focused on offering InvoCell and the IVC procedure to patients. We successfully accomplished this with the opening of three new centers in the latter part of the year, with the first starting in Birmingham, Alabama, followed by Atlanta, Georgia, and finally Monterey, Mexico. All three centers are now operational and treating patients. So our commercial strategy remains very focused on continuing to establish new InvoCenter clinics, selling the InvoCell technology to other existing fertility clinics, what we refer to as our distribution business, and longer term, as we work through the necessary details, leveraging existing established clinics in the OBGYN arena and bring the InvoCell treatment solution to those practices in a collaborative manner. The opening of the first three InvoCenters was without question a major milestone for the company. A tremendous amount of work went into this effort, something many of you know started well before the actual opening of the clinics. We expect the InvoCenters will be extremely impactful to the overall commercial progress moving forward and help expand awareness and further credibility overall. I would also note that we most certainly learned a lot through the process with these first clinics, and we'll look to apply that improved wisdom as we expand on the InvoCenter concept moving forward. That experience gained really helps with our forward planning and analysis. For example, there are several key steps involved in opening an InvoCenter. As such, we are making a conscious decision to move to more of a parallel strategy on those necessary steps rather than doing them sequentially. The goal here is to improve timelines as well as help offset supply chain logistic challenges, which are a real issue and often reported in the news. This also implies we are taking the lead or more control over the entire process of preparing a new center compared to the initial centers. On the startup costs, we believe the upfront costs will average closer to $700,000 to bring an InvoCenter operational. We also now expect the capital needed to support the clinic operations before reaching a break-even point will range between $300,000 to $500,000, depending on the specific structure with the physician operators at each clinic. We expect it to take approximately six to eight months to build and be ready to open the doors for each new center. We are taking a data centric approach towards selecting new markets. This involves both quantitative and a qualitative data review toward determining suitable areas. From a high level perspective, we are setting a goal of 20 INBO centers over the next three years. We can see ways to expand that as well as we recognize challenges that could impede that progress. But this is our current objective and we will update along the way. Equally important, when looking at an individual new center and how we expect it to ramp. We are setting a three year goal for each Invo center to reach an approximate 600 annualized treatment cycle run rate. Doing so should equate to a single center annual revenue of approximately four and a half million by that point and around a million and a half in operating profit. So at 20 centers, when they all reach that initial target level would imply close to 90 million in revenue and 30 million in operating profit. Please note that since we expect most of these to be JVs or shared profit interest, there will be a sharing of a portion of this operating profit with the physician operators. Of course, we will look to further grow each center beyond those initial target levels, and we don't intend to stop at 20 centers long term. Also, as this plan evolves, and if we can successfully collaborate with the existing infrastructure out there, We could also accelerate this plan, develop additional ways in which to expand, as well as potentially drive down the startup costs. We will work toward that as a goal as well. I realize we are giving a multi-year big picture perspective, but we want our shareholders to understand how we are thinking and what we want to try to achieve over time. Near term, we have the Northern California Center working through the build process. That is taking longer than initially expected, but we do expect it to complete this year. And the Tampa planning is well underway and a specific site having been located. We also expect to announce additional cities we intend to start the process on very soon. Again, as this strategy continues to evolve, we may find ways to further expand our efforts. Of course, this is not the only part of our commercial approach. We are working to expand our distribution activities, selling to existing established clinics. We believe there is encouraging developments on this front, and we still see the existing IVF clinic market as an important channel and intend to fully support that part of the market. We also have potential international partners interested in teaming up with us to develop an InvoCenter in their market. We are primarily focused on our North American InvoCenter efforts with the bulk of our resources, but we will support additional interest in other areas as it comes to us and where we can heavily rely on the partner for much of the work necessary to bring a center operational. As we've noted over the past year, the team we have assembled collectively has many years of experience in the device commercialization business and within the fertility space. Their ongoing efforts position us well to execute on our strategy. Another very important part of our story is patient outcomes data, including the further expansion of real market usage data around InvoCell, along with peer reviewed papers and abstract posters, which were presented late last year at ASRM, continues to demonstrate excellent patient outcomes and adds to the clinical validation around the technology, which builds confidence for practitioners and patients alike. We are also excited to see our own new Invo centers experiencing quality outcomes in these early days as well. On the initial Invo centers, they are progressing well. We recognize that it does take time to establish and build local awareness around a brand new medical practice, especially one that is also providing a newer treatment solution. Our Birmingham partners had some advantages in their specific market, given their prior experience and reputation around InvoCell from their previous clinic. that was located in the same area. Atlanta and Mexico have taken longer to build initial patient activity, but key metrics, which are important precursors to larger revenue and actual IVC cycles, such as initial patient inquiries to first consultations to then doing initial diagnostic testing, are trending well. We are also learning and gaining valuable insight with initial marketing programs, something we will look to deploy earlier and in a more concerted manner to accelerate these early trends in future clinics. Let me transition for a moment. On our five-day clinical efforts, we completed collecting all the necessary data, which we reported on our last call. However, what we did not recognize at that point was that some of the data showed inconsistencies that required us to circle back to the clinics for clarification. Most of that turned out to be input errors that we needed to clean up. We are through that back and forth process. This was a much longer and more tedious process than we originally envisioned. We don't believe we will find any additional items to scrub as we finalize all the statistics around the data and prepare for submission, something we now hope to have ready in the coming weeks. With that, let me turn this over to Mike for some additional details around the commercialization efforts.