NexGel, Inc

Good day, and welcome to the next show, Q1 2022 Earnings 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 touch-tone phone. 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 Walter Pinter. Please go ahead.

Thank you, Operator. Good evening, and welcome, everyone, to the NextGel First Quarter 2022 Earnings Conference Call. I'm joined today by Adam Levy, Chief Executive Officer, and Adam Dropsik, Chief Financial Officer. Before we begin, I'm going to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meanings of the Safe Harbor of the Private Securities Litigation Reform Act of 1995, and actual results may differ materially due to a variety of risks and uncertainties and other factors. For a detailed discussion of some of the ongoing risks and uncertainties in the company's business, I refer you to the press release issued this evening and filed with the SEC on Form 8K, as well as the company's reports filed periodically with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law. In addition, during the course of today's call, we may refer to non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States and that may be different from non-GAAP financial measures used by other companies. Investors are encouraged to review NextGel's current report on Form 8K, furnished with the SEC for NextGel's reasons for including these non-GAAP financial measures in its earnings release. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in our earnings press release issued this evening and was otherwise noted here within. With that, it's my pleasure to turn the call over to Mr. Adam Levy. Adam, please go ahead.

Thank you, Walter, and thank you, everyone, for joining us to discuss our financial and operating results for the first quarter of 2022. As a reminder, NextGel is the leading provider of ultra-gentle, high-water content hydrogels with broad applications in the healthcare and consumer industries. We have created both new products and lifecycle extensions for existing products that change and enhance the patient experience for the better. We operate one of only two electron beam hydrogel manufacturing facilities, a 13,500-square-foot GMP ISO-certified facility. Our core technology, the electron beam accelerator, eliminates the need for harmful chemical initiators and cross-linking for hydrogel manufacturing. This unique process makes our products well-suited for a wide range of healthcare and consumer applications. Our gentle, high-water content and paraben-free formulations make our patches often the only option for many medical device, dermatology, and beauty and cosmetic applications, all very large addressable markets. Despite the macroeconomic challenges across the supply chain, I am pleased with our growth in the first quarter. For the three months ended March 31, 2022, revenues were $396,000, an increase of $129,000, or 48%. The increase in our overall revenues was due to sales growth of new products in custom label manufacturing and branded consumer products. As you may recall, our business can be a bit lumpy and has some seasonality with the fourth quarter typically being a high quarter in the year. We are now six weeks into the second quarter and feel very comfortable that our year-over-year revenue growth trend will continue for the foreseeable future. This growth is a testament to our continued execution in each of our verticals, medical devices, branded products, and custom contract manufacturing. Under medical devices, we continue to make progress with the FDA for NexStrape, our skin-friendly antibacterial solution for the surgical inside straight market. Skin integrity is very important for infection prevention, which is why we are developing this product specifically for patients with fragile or extremely sensitive skin. The company has filed worldwide patents on the product and recently had our pre-submission meeting with the agency. we now have a clear picture of our path forward. The other medical device opportunity we are tackling are IV and central line sites through our Nextderm product. Tegaderm, the current and most used product, can be very difficult and painful to remove on patients, especially for those with compromised skin. Nextderm's approach is to support compromised skin patients with a gentle product that is repositionable with pain-free removal and also has antimicrobial properties. As mentioned in our inaugural call, we are pursuing partnerships through a licensing strategy for these products to be commercialized in order to remain lean and focused on profitability. In our branded products vertical, our Metagel brand has 10 SKUs currently available on Amazon, with several more planned for later in 2022. Metagel demand continues to increase through our Amazon shop, as we have seen our sales grow across the entire product line. First quarter sales grew to 213,000 from 36,000 year over year. In our custom and white label manufacturing vertical, we started new custom label R&D projects with several new customers, and interest in the service remains very strong. As a reminder, our custom and white label manufacturing is complementary to our business model because it allows us to create relationships with various companies for development projects and to explore and jointly create new healthcare and consumer products. The development costs associated to these projects are funded by the customer, so NextGel bears no development cost risk. As we execute on our multi-pronged approach, we still have significant room for scaling our capabilities and facility utilization, which will lead to increased year-over-year revenues and improved margins. With that, I'll hand it over to our CFO, Adam Drapsik, to walk through our financial results in more detail. Adam, over to you.