Avita Medical, Inc.

Hello, thank you for standing by, and welcome to the Aveda Medical, Inc. Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. Please be advised that today's conference may be recorded. I would now like to hand the conference over to your speaker today, Caroline Corner. Please go ahead.

Thank you, Operator. Welcome to Avita Medical's second quarter 2022 earnings call. Joining me on today's call are Dr. Mike Perry, Chief Executive Officer, and Michael Holder, 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 Avita Medical operates, trends, demands, and expectations for its products and technology, its expected financial performance, expenses, and position in the market, and the impact of COVID-19 on its operations and its 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 Avita Medical's most recent filings with the SEC, particularly the risk factors described in Avita Medical's S3 and 10-K filings, and in Aveda Medical's quarterly report on Form 10-Q for the second quarter ended June 30, 2022, 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. Aveda Medical undertakes no obligation to update these statements except as required by applicable law. Aveda Medical's press release, the second quarter 2022 results, is available on the website, www.avetamedical.com, under the investor section and includes additional details about its financial results. Aveda Medical's website also has the latest SEC filings, which you are encouraged to review. A recording of today's call will be available on Aveda Medical's website by 5 p.m. Pacific time today. Now I'd like to turn the call over to Mike for his comments and second quarter 2022 business highlights.

Thank you, Caroline, and thank you, everyone, for joining us today. We continued to deliver strong growth in our top-line revenue this quarter, and we are pleased to report record commercial resale revenues, which exclude BARDA revenue of $8.2 million compared to $6.7 million, a 23 percent increase over the same quarter last year. Our commercial revenue was $15.7 million in the half year ending June 30th, 2022, an increase of $4.4 million, or 39%, compared to $11.3 million in the corresponding period in the prior year. In the quarter, we achieved greater penetration in a larger base of accounts, leading to an increase in overall burn cases treated with resell. With ongoing improvement in access to burn centers and in-person meetings, we were able to resume our commercial activities in the new normal operating environment. Our commercial team increased their field training cadence to reach over 300 burn care providers each month, up from approximately 200 per month in the first quarter. In addition, We are continuing to conduct webinars and summits that are now in person to further broaden our reach. An increase in field training coupled with case support designed to help alleviate staffing constraints has allowed us to broaden provider adoption, deeper penetration, and ultimately increased order size. We began selling the ease of use resell device to our larger accounts this quarter, which is resonating well, particularly with those customers who are experiencing ongoing staffing challenges that I just mentioned. We have shipped the new device in a phased release to approximately a quarter of our accounts. Turning now to the outpatient market, we initiated our limited launch in March. As we expanded to new indications, our outpatient market will become a larger portion of our addressable market and an increasingly important patient population supporting our continued growth. While the bulk of burn procedures are inpatient, we expect that outpatient treatment will comprise our core soft tissue market. As such, we are working to familiarize centers with outpatient care pathways, coding, and coverage. Relative to Japan, we, along with our partner, Cosmotech, completed our first training and evaluation cases in Japan during the quarter. As I mentioned in our last call, discussions are ongoing with the Japanese authorities regarding reimbursement and pricing, which we anticipate will wrap up later this year. I'd like to highlight a recent media story in which a 12-year-old homeschooled student's science experiment exploded, resulting in second and third degree burns to over 50% of his body. In addition to the young student, his mother sustained second and third degree burns while saving her son's life. Both the boy and his mother have been undergoing resale treatment at the Joseph M. Still Burn Center of Doctors Hospital in Augusta, Georgia, which is the largest burn care facility in the United States and one of our largest customers. We are inspired by the burn community, which has been uplifting the family during this crisis, and we're encouraged by both the mother and the son's recovery thus far. Moving on now to our pipeline indications, we made solid progress in our soft tissue reconstruction and stable vitiligo trials. We just released top line data for our soft tissue reconstruction trial. The study had co-primary endpoints based on pairwise comparison where each subject received both resell used in combination with widely mesh skin grafting and the control treatment of conventional skin grafting. One endpoint had hypothesis of superiority for donor skin sparing, and the other co-primary endpoint had a hypothesis of non-inferiority for healing. Resell showed statistically superior donor skin sparing versus the conventional autografting standard of care control, thereby achieving the endpoint. While comparable healing was observed between resell and control, pre-specified statistical non-inferiority was not met. Nonetheless, the statistically significant donor sparing and comparability in an observed healing, along with the established safety record of resell, together point to a favorable benefit-risk profile. As such, we will proceed as planned with PMA submission for both the soft tissue and vitiligo indications later in 2022 with FDA approvals anticipated in the second half of 2023. As I mentioned previously, once approved in soft tissue reconstruction, we expect to initially leverage our installed base of burn centers and our existing infrastructure to launch the resell system into our burn centers that are co-located with level one and level two trauma centers. From there, we plan to grow into another 200 to 250 high volume trauma centers, which do some burn cases as well, and we'll update you on our plans here in future calls. Notably, trauma centers will be able to use the existing reimbursement codes currently being used in the burn setting. We are excited to deploy what we've learned in burn care to efficiently and effectively address the soft tissue trauma opportunity. Turning now to vitiligo, and as we've stated in previous calls, This is a skin disorder characterized by deep pigmented areas of skin that appear as white spots or patches, and which are primarily attributed to an underlying autoimmune disorder in the patient. There are an estimated 100 million sufferers of the LIGO worldwide, including up to six and a half million Americans. With recent completion of patients six months follow-ups for our vitiligo clinical trial, we expect top-line data followed by PMA submission during the second half of 2022 with FDA pre-market approval and commercial introduction anticipated prior to the end of 2023. We recognize that our current resell product involves hands-on preparation of the cell suspension by physicians and or their supporting staff. To make the best use of physician and support personnel's time in the dermatologist's office to address our vitiligo opportunity, we are developing an automated resell device. We are encouraged by the FDA's recent approval of a topical JAK inhibitor, which we believe will further drive vitiligo disease awareness in this very large market that has limited effective treatment options. Over time, we anticipate multiple product entrants to this compelling opportunity. We believe the strong safety record of resell and the one and done nature of the associated treatment procedure will be differentiated as well as medically and commercially important. We've been working diligently on vitiligo pre-commercialization activities. Avita has attended nine dermatology conferences since January of this year. At these conferences, over 25 sessions have featured vitiligo, a marked increase year over year, as JAK inhibitors and resell have stimulated interest in vitiligo treatments. Importantly, resell received numerous mentions in these sessions. With that, I'd now like to remind you of our strategic growth drivers. We are keenly focused on driving healthcare provider engagement through education, maintaining our recent momentum in Burns. The fall conference season is just ahead, and we are excited for continued in-person conversations. Second, we anticipate submission of PMA supplements by the end of 2022 for both soft tissue reconstruction and vitiligo indications, and we continue to plan to enter those markets in the second half of 2023. Lastly, and turning to a longer-term growth driver, our pilot work in establishing resale within the outpatient setting continues, where we anticipate the future bulk of soft tissue trauma cases. In summary, we are executing on our business objectives and have successfully achieved several key milestones this year. I'm encouraged by our commercial team's performance driving advanced practice training and keeping resale front and center in the minds of burn care practitioners. I look forward to updating you later this year and our continued program in our exciting pipeline indications. With that, I'll now turn it over to Michael for details on our financial performance in the quarter. Michael?