Inari Medical, Inc.

Good day and thank you for standing by. Welcome to the Yonari Medical First Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I'd now like to hand the conference over to your speaker today, Caroline Corner with Investor Relations. Please go ahead.

Thank you, operator. Welcome to ANARI's first quarter 2022 earnings call. Joining me on today's call are Bill Hoffman, President and Chief Executive Officer, and Mitch Hill, Chief Financial Officer. This call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements, including statements regarding the markets in which ANARI operates, trends and expectations for ANARI's products and technology, trends in demand for Inari's products, Inari's expected financial performance, expenses, and position in the market, and the impact of COVID-19 on Inari's operations and Inari's customers' operations. These statements are neither promises nor guarantees and involve known and unknown risks and uncertainties that could cause actual results, performance, or achievements to differ materially from any results, performance, or achievements expressed or implied by the forward-looking statements. Please review Inari's most recent filings of SECs. particularly the risk factors described in Inari's annual report on Form 10-K for the year ended December 31, 2021, for additional information. Any forward-looking statements provided during this call, including projections for future performance, are based on management's expectations as of today. Inari undertakes no obligation to update these statements, except as required by applicable law. Inari's press release of first quarter 2022 results is available on Inari's website, www.inarimedical.com, under the Investor section and includes additional details about Inari's financial results. Inari's website also has the latest SEC filings, which you are encouraged to review. A recording of today's call will be available on Inari's website by 5 p.m. Pacific time today. Now I'd like to turn the call over to Bill for his comments on first quarter 2022 business highlights.

Thank you, Caroline, and thank you, everyone, for joining us today. Our first quarter was again productive and successful. We treated a record number of patients and executed crisply across all of our growth drivers. And you may have seen also that we successfully raised additional capital to support our increasingly aggressive mission to address unmet patient needs. We'll share some detail about all of this shortly, but we'd like to start now, as we always do, with a patient story. Early this year, a man in his mid-60s presented to a vascular surgeon who runs a vein clinic in Arizona. and treats chronic DVT. The patient, previously a very active man in his mid-60s, was nearly immobilized and using strong narcotics to control pain caused by a large open wound on his leg from which he'd been suffering for more than a year. The patient was struggling with post-thrombotic syndrome, or PTS, from a DVT that was treated only with anticoagulation. He had been told by multiple physicians there is nothing that can be done for chronic DVT. And yet, the physician was able to use clot-triever BOLD to extract a large volume of chronic clot in a very short procedure. After suffering for over a year with an open wound, the clot-triever BOLD procedure resulted in his wound healing completely in just two months. He is walking now without pain and without pain medication. PTS is caused by persistently high pressure in the legs as a result of deep venous scarring due to clot that remains after ineffective DVT treatment. About 50% of all patients whose DVT is treated with conservative medical management will develop PTS. It is a progressive disease with early symptoms ranging from heaviness, swelling, and pain, leading then to pigment changes and scaly, dry skin with scabs, and finally, to venous ulcers. that sometimes necessitate amputation. It is horrendous. Quality of life scores for these patients suffering from PTS are similar to or lower than those of patients burdened with cancer and heart failure. We believe removing even some chronic clot increases the lumen inside the vein, which decreases the pressure that is the cause of these symptoms. BOLD is important because it is purpose-built to remove chronic clot. It is the first tool in a broader toolbox we are committed to develop and introduce targeting this terrible disease over the coming several quarters. We are steadfast in our mission to transform the lives of our patients in the most extraordinary ways. We increasingly sense responsibility, not merely opportunity, as we develop new solutions for complex disease states and unmet patient needs. We love this work and we appreciate your continued support. I'd like now to turn our attention to Q1 financial performance. Our revenue in Q1 was $86.8 million, up $29.4 million, or 51% from the same quarter last year, and up $3.6 million, or 4% from Q4 2021. Procedure growth was robust. Our physician customers performed approximately 8,800 procedures, including an increased but still modest number of cases from Europe. Procedure count was up from 7,700 cases, or about 14%, from Q4. The difference in growth rates between procedures and revenue is based largely on the timing of new product introductions and the associated stocking orders. Average selling prices were unchanged. Please note that we are no longer providing information about COVID-associated procedures as we no longer believe this metric is useful. COVID has infected so much of the general population that a current or previous diagnosis is now as often incidental as causative to any given procedure. Going forward, we also intend to discontinue our historical practice of sharing procedure volume of any kind. There are two reasons for this change. First, we intend to introduce multiple new products this year. Many will have different average selling prices, launch strategies, stocking plans, and so there will no longer be a simple link between revenue and procedures as we've seen historically. Second, we believe sharing procedure information in an increasingly competitive space is counterproductive. We note that none of our competitors provide such information, perhaps for similar reasons. I'd now like to share with you recent progress we have made on all of our growth drivers. Our first growth driver is the expansion of our sales organization. The size of our core TAM is large, and our penetration remains under 5%. We're going to need a lot more sales professionals. We committed to at least 275 territories by the end of 2022, and we are on pace to achieve this goal. These increasingly smaller territories position us to execute our second growth driver, which is driving deeper adoption at existing hospital customers. Most VTE patients continue to be treated with anticoagulation alone, and in fact, many of these patients never even see a physician who is a VTE expert. Our goal is to establish patient pathways that are similar to those seen for heart attack and stroke so that patients are consistently triaged to VTE experts. We refer to the various parts of our approach collectively as VTE excellence. The more constructive post-Omicron hospital operating environment has been conducive to these efforts as we are more consistently able to access and educate non-interventional physicians and administrators who are critical to the development of these programs. An increasing number of hospitals have now installed VTE coordinators as a direct result of our VTE Excellence efforts. We have begun training VTE coordinators via full-day programs delivered regionally throughout the country. We are committing significant resources to VTE Excellence, and we'll have a lot more to share with you as we make further progress. Our third growth driver is to build upon our base of clinical evidence. We have exciting and timely news here. We recently announced at the annual meeting of the American Venous Forum, the results of a sub-analysis of the clout registry focusing on clot age. This study, conducted on the first 250 patients enrolled, shows that the clot in one-third of patients treated was chronic. This fact alone is remarkable, as this patient population has historically been excluded from all thrombectomy trials because other thrombectomy devices cannot remove chronic clots. Conversely, the data on our patients looks fantastic. ClotTriever showed complete or near complete clot removal in 84% of these patients. More important, six-month follow-up data shows that fewer than 10% of these patients suffered from moderate to severe post-thrombotic syndrome, down from 52% at baseline. ClotTriever is the first thrombectomy device shown to be effective at treating chronic DBT. We believe BOLD, which is now in full market release, will be even more effective for patients with older clot and more severe symptoms, as per the patient anecdote we shared a bit earlier. Our fourth growth driver is to expand our product portfolio. We have several developments to share here as well. First, we recently received FDA clearance of our Entry24 sheath. In fact, we have already completed the successful limited market release and have entered full market release. The Entry is a sheath used to introduce our FlowTriever devices. It is purpose-built for use with Inari devices, and it increases their effectiveness, especially in the most challenging cases. It eliminates the need for third-party sheaths and the ongoing backorders that have challenged our customers and our field team for years. We believe it will be used in nearly every flow tree of a procedure, and because it is included in our per-procedure pricing, it removes cost from the procedure for our customers, it increases the value of the Inari solution, and further separates us from competition. Next, perhaps you saw that we recently obtained FDA clearance for ARTIX in March. This product is a peripheral thrombectomy device designed to address unmet needs in a new patient population. It is the first component of a broader toolbox we are developing. We look forward to sharing more after we've completed our limited market release. These new products are a result of the robust R&D engine that we have developed. You can expect multiple additional product introductions this year. We have committed to even more aggressive investments moving forward. Our last growth driver is expansion into international markets. We saw steady progress in our European business in Q1, with case volumes up more than 40% sequentially. We expect continued momentum as hospitals in Germany, our largest European market, begin to benefit from enhanced reimbursement. Beyond Europe, we are pleased with our progress all over the world with continued growth in Canada, Latin America, and the Asia-Pacific region. As we've noted previously, international will not be a material component of our overall revenue mix in 2022. Finally, I appreciate always the opportunity to remind you that we remain committed to a mission and to impacting human life in the most beautiful ways. Our markets are large, patient needs are significant, and we are serious about our responsibility to do better for these patients. I'll close by saying thank you so much for your support of our recent capital raise. We intend to continue to invest wisely, responsibly, and even more aggressively in all of our growth drivers. We believe we can and will grow sustainably for many quarters to come. With that, I'd like to turn things over to Mitch.