ReShape Lifesciences, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the Reshape Life Sciences Fourth Quarter 2021 Earnings Conference Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during this session, you will need to press star then 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star then 0. I will now like to turn the conference over to your speaker for today, Michael Miller, Rx Communications. You may begin.

Good afternoon and thank you for joining the year end 2021 Reshape Life Sciences earnings conference call. I'm pleased to be joined by Bart Bandy, President and Chief Executive Officer of Reshape Life Sciences Inc., who will provide an overview of the company's activity during 2021 and milestones to date. Tom Stankovich, Chief Financial Officer of Reshape, will then review the financial results for the year, after which we will open up the call to a question and answer session. As a reminder, This conference call, as well as Reshape Life Sciences SEC filings and website, including the investor information section of the website, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those discussed due to known and unknown risks, uncertainties, and other factors. These and additional risks and uncertainties are described more fully in the company's filings with the Securities and Exchange Commission, including those factors identified as risk factors in the company's most recent annual report on Form 10-K. As an additional reminder, reshaped stock is listed on NASDAQ, trading under the symbol RSLS. I will now turn the call over to Bart Bandy, President and CEO of Reshape Life Sciences. Bart.

Thanks, Michael. Good afternoon, everyone, and thank you for joining us today. 2021 was a year filled with significant accomplishments for Reshape, beginning with our merger with Obolon, our listing on NASDAQ, and our subsequent $46 million financing, all of which positioned us to capitalize on the existing FDA approval and broad insurance reimbursement of the lap band and to reinduce this proven product, and other weight loss initiatives directly to the consumer or patient market. With that in mind, in October we launched a multi-platform direct-to-consumer advertising campaign utilizing national television, print, social media, and public relations to market our LapBand program, with available active care supported through Reshape Care, a reimbursable virtual health coaching platform that can also support weight loss objectives for people who are not surgery candidates. The goal was to create consumer awareness and increase patient demand for lap bands. And as we recently reported, the early metrics have been extremely promising, recognizing that the four to six month mandatory waiting period for insurers represents a lag between early engagement and procedures. In 2021, we nevertheless witnessed a robust 20% increase in revenues year over year to 13.6 million. Before I go into more detail on our progress, I would like to once again recap the incredible market opportunity before us. Studies show that 73% of American adults are overweight or obese, with about 50% of that population seeking to lose weight every year. A Harris Poll research study conducted in late February of 2021 reported that 61% of American adults experienced undesired weight changes during the pandemic, with 42% claiming they gained more weight than they intended, an average of 29 pounds, With 10% reporting, they gained more than 50 pounds. And remember, this was one year ago. The epidemic of obesity is something we need to address globally, with 30% of the world now qualifying as overweight or obese, a number which is projected to grow to 50% by 2030, making the bariatric market a multibillion-dollar opportunity in the U.S. alone. Reshape is poised to take a lead position of addressing this significant and expensive health issue, with a suite of physician-led weight loss solutions, including our flagship product, the LapBan, which has specific FDA-approved weight loss indications. Clinical recognition is the safest surgical procedure and coverage by most major insurance plans, including Medicare. To implement this strategic brand awareness and intended market engagement campaign for reshape, the LapBan and reshape care in the fourth quarter of 2021 we launched our national demographic-targeted direct-to-consumer marketing campaign across the highest-viewed television channels and print publications with the goal of effectively communicating the benefits and differentiated advantages of the lap band, the only widely-reimbursed, FDA-approved laparoscopic weight-loss device commercially available in the U.S. The lap band is unrivaled, being adjustable, reversible, and well-proven, with over 1 million bands having been placed in the patient's globally in the last 20 plus years, demonstrating superior safety and efficacy profiles compared to highly aggressive stomach safety procedures and diets. Adjustability, reversibility, and having personal control as opposed to something being done to you have also been shown to have highly desirable aspects for potential patients when making bariatric surgery decisions. Additionally, the reduced risk of adverse events and nutritional deficiencies associated with anatomy altering procedures have also been identified as being of great significance in this decision-making process. The fact that most patients return home the same day as their lap burn procedure, which is available in outpatient surgery centers, is also a key determining factor, especially given how COVID has affected patients and doctors at the hospital level. Based on our recent commercial consumer testing and the known historical impact of patient direct marketing programs for the lap band, We were very optimistic about the potential of a national marketing campaign for our physician-led ecosystem of weight loss solutions. Since the beginning of the marketing campaign, LabBan has been featured in 10 major magazine publications and over 20 national cable stations that are all focused on our target audience. Going forward, we will continuously improve on these marketing efforts through diligent metric analysis and adaptation, while also pursuing co-op marketing partnerships local digital media, and a national social media influencer campaign. As we recently announced in our press release last week, early analysis results from the marketing campaign have been outstanding. Since October, we have experienced 250,000 more patient visits to the lapband.com website, resulting in 480% more patient requests for information on the lapband procedure compared to the immediate month used to establish a baseline prior to launching this campaign. More importantly, Doctor referrals for consultations have surged over 400% in that same period. This significant increase in potential patient and bariatric surgeon engagement indicates that our message is clearly resonating with the consumer and professional markets. We have witnessed a 25% increase in requests from bariatric practices for refresher training and certification on the lap band procedure. And for what we believe to be a very positive umbrella effect with our campaign, Traffic to our surgeon locator is up a noteworthy 1,300% compared to the same DTC pre-launch baseline period. In January of this year, we had the opportunity to present the LAPBAM program and expand awareness to a range of key bariatric surgery providers at the American Society for Metabolic and Bariatric Surgery's ASMBS Leadership Academy and their reunited meetings. where we received overwhelmingly positive feedback on the need for training and inclusivity of the procedure for bariatric practices. Moreover, anecdotal feedback from surgeons on the positive impact of new patient flow from the DTC campaign has been remarkable, and as a result, we expect to experience heightened physician engagement, leading to increased lap band procedures and thus potentially a significant increase in revenues to reshape over time. This is a key component of this business model that I must call out again. The average mandatory wait period for insurers of bariatric surgery is four to six months. We had an early launch in Q4 of 2021, adding television networks and magazines throughout that quarter after gaining medical review committee approvals, and followed that with a major investment into the campaign in the first quarter of 2022. As we are now seeing procedures directly tracked to the campaign, we remain positive that the back half of this year will demonstrate the true potential of this strategy and execution. While raising the visibility of the lap-bound program, we've also continued to build our proprietary ecosystem of unique weight loss solutions that provide more revenue-producing pathways, keeping patients in our sales channels longer. Notably, our reimbursed reshape care virtual health counseling platform is a key element of our medically managed and bariatric surgery patient outreach strategies. facilitating more engagement, longer-term retention, and optimized health improvement. Our entry into the virtual healthcare delivery space allows us to tap into a market that is expected to reach $95 billion by 2026. Reshape Care and its extension, Reshape Marketplace, provide an e-commerce platform to access a collection of healthcare provider-recommended, competitively-priced weight loss and wellness products that support the vital areas of nutrition, exercise, sleep, and stress. This e-commerce-based offering includes Reshape's new, advanced line of premium supplements to optimize health and well-being, specifically for bariatric surgery and medical weight loss patients. On the operations front, by moving our manufacturing from Costa Rica to a new United States-based supplier, which we announced last summer, we have begun to realize significant efficiencies and cost-of-good savings. In order to support our accelerating patient flow from our DTC marketing campaign and strategic initiatives, we have significantly bolstered our sales operations and commercial groups with the additions of Michael Bordanik as Senior Vice President of Commercial Operations and Al Diaz as Vice President of Operations and Research, along with others including a number of key sales personnel. Now I'd like to take a moment to review our pipeline. Once we receive necessary approvals for European-based study sites and communicate our go-forward plans with regulators, we will resume our EU-based clinical trials for the ReShape Vest, a laparoscopic implantable technology designed to support and enhance the weight loss journey for a patient with stomach reduction surgery, which has the potential to replace or complement current volume-reducing bariatric procedures. We remain in contact with clinicians and clinical sites regarding this trial, where access to facilities and patients was precluded by the COVID-19 pandemic. Getting through our merger with Ovalon, as we mentioned last quarter, we continue to explore the compliance and regulatory requirements, manufacturing viability, and quality system controls necessary for reintroducing the Ovalon balloon system. The technology is the first and only swallowable, gas-filled, FDA-approved balloon system introduced into the U.S. weight loss marketplace as a non-surgical, minimally invasive product. With the assistance of a grant from the NIH, we completed and met the necessary endpoints in order to complete the preclinical development of the reshape diabetes block stem neuromodulation technology, a novel investigational device using neuromodulation to adjust insulin production and potentially treat type 2 diabetes. We have submitted for a second grant for which we recently responded to request for additional information from the NIH committee over the recent holiday break. We remain committed to evaluating the potential of this platform which is backed by a strong intellectual property portfolio through an agency and strategic investor-based non-dilutive funding strategy. Additionally, we will continue to pursue M&A opportunities that align with our commitment to the physician-led weight loss and metabolic solutions market, enhance our current product portfolio, and can be a creative to our value. We are pleased with our recent efforts and achievements. Highlighted by our national DTC marketing campaign, and the recognized results to date. We will continue to maintain focus on marketing the proven advantages of the LapBand program in line with their positive metrics and resulting procedures. And we'll continue the evaluation, development, and prioritization of our portfolio and external opportunities that can bring additional value-creating weight loss solutions to our company. I look forward to providing further updates on our progress in the quarters to come. I will now turn the presentation over to Tom for a review of our financial performance. Tom.

Thanks, Bart. And once again, thank you all for joining our webcast this afternoon. Before turning to our detailed metrics, I'd like to provide some color on our non-cash stock compensation expenses, impairment charges, and costs related to the merger with Opalon that drove substantial increases in our non-cash operating expenses for the following areas, sales and marketing, General Administrative, and R&D. As a company, we place employees at the heart of our business. Understanding that, stock-based compensation is a proven and effective tool to retain existing staff, attract seasoned professionals, and enhance incentive programs. Subsequent to the merger with Obilon, listing on NASDAQ, and our fundraising, we issued for the first time since 2017 restricted stock units and stock options throughout the organization. Considering the height of this expense during the quarter, we believe it is appropriate to call out these metrics. For the year-end of December 31, 2021, we recorded $12.8 million in total stock compensation expense. Of note, a majority of this expense includes a one-time charge for a look-back provision for vesting to begin at the one-year anniversary date of employment. We also recorded a loss on impairment of intangible assets and goodwill of $28.8 million. This is primarily due to significant drop in our market capitalization at December 31st, 2021, coupled with the delay in the clinical trials for the reshaped vests due to the COVID-19 pandemic. It is important to note that both the stock compensation expense and loss on impairment are non-cash expenses. between the relatively high normal non-cash stock-based compensation expense loss on impairment and the $6 million acquisition-related outlay of funds, and given these expenses are specific in nature and uniquely attributed to events this past year, the company expects its expenditures to revert to the customary levels moving forward, considering the effect of these charges are non-recurring. With that in mind, let's turn to our revenue and operational results. For the year ended December 31st, 2021, we reported 13.6 million of revenues compared to 11.3 million of revenues for the year ended December 31st, 2020, an increase of 2.3 million or 20%, which is attributable chiefly to a $2 million increase in the U.S. and a $300,000 increase internationally. We reported gross profit of 8.4 million for the year ended December 31st, 2021, compared to $6.3 million for the year ended December 31, 2020, an increase of $2.1 million, or 33%. Gross profit as a percentage of revenue for the year ended December 31, 2021, was 61.4%, compared to 55.4% for the same period in 2020. It is important to note, as Bart stated earlier, that we have also begun to realize significant cost of goods savings by moving our manufacturing from Costa Rica to a new supplier in the U.S. Additionally, the increase in gross profit margin is also due to increased revenue, reduced period expenses, and improved product mix with higher domestic sales as a percent of revenue, which have a higher gross profit margin than international sales. Total operating expenses for the year ended December 31st, 2021 increased by 46.1 million to 64.8 million as compared to 18.7 million for the year ended December 31st, 2020. The increase is primarily due to the previously mentioned one-time charges for a merger, non-cash stock compensation, and a loss on impairment of intangible assets and goodwill. Additionally, Sales and marketing expenses increased due to the launch of our multi-platform consumer advertising campaign utilizing national television, print, social media, and public relations during the fourth quarter of 2021. Sales and marketing expenses for the year were $9.2 million as compared to $4.7 million for 2020. Aside from other previously mentioned factors, our increased expenditure stems from additional marketing and advertising efforts and an increase in related expenses from expanded commercial organization. The company expects to continue devoting more resources towards sales and marketing, particularly through our national direct-to-consumer campaign, resulting in an increase in sales and marketing expenses for 2022. General and administrative expenses were $24.4 million for the full year of 2021, compared to $10.5 million for the year ended December 31, 2020. an increase of $13.9 million. In addition to stock-based compensation expense, this amount also reflects an increase in legal, insurance, professional services, payroll-related expenses, and an increase in rent and facility expenses associated with the Ovalon merger. Research and development expenses were $2.5 million for the full year ended 2021 compared to $3.5 million for the year ended December 31, 2020. The decrease is primarily related to a slowdown of clinical trials related to the reshape vest due to the COVID-19 pandemic. On a non-GAAP-adjusted EBITDA basis, including the addition of non-cash stock-based compensation, depreciation, amortization, and impairment, amongst other things, the loss was $10.6 million for the full year of 2021 compared to a loss of $9.1 million for the year ended December 31, 2020. The increase is primarily related to strengthening of our organizational and commercial operations. Now turning to the balance sheet, as of December 31st, 2021, the company's cash and cash equivalents totaled approximately $23 million. Of note, we eliminated all debt from the balance sheet, including $10.5 million term debt with an institutional investor and our final $3 million obligation to Apollo Endosurgery for the purchase of the lap band in December of 2018. Additionally, $6 million in professional service and investment banking fees were paid related to the Ovalon merger. As mentioned in previous quarters, we continue to save and optimize costs while we strive to increase revenue and pursue significant ROI growth opportunities. As COVID-19 restrictions continue to be lifted, and elective procedures continue to rise, our efforts around product visibility and demand for our products, we look forward to reporting even better results in the coming quarters. With that, I will turn the call back over to Bart to begin the question and answer period.

Thanks, Tom. Operator, please open the lines for questions.

Thank you. Ladies and gentlemen, as a reminder to ask the question, you will need to press star then 1 on your telephone. To withdraw your question, press the pound key. Again, that's star one to ask the question. Please stand by while we compile the Q&A roster. Our first question comes from the line of Anthony Vendetti with Maxim Group. Your line is open.

Thank you. Good afternoon. Hi, Anthony. Hey, Bart. Tom, how are you doing? So the DTC marketing campaign – showed significant growth in terms of the number, I guess in terms of percentage for leads generated. I was wondering if you could tell us the number of leads generated or number of consultations directly, you know, as best you can tell directly related to the DTC marketing campaign.

Thanks. Yeah, that's something that we worked out through what the metric funnel, so to speak, looks like. I think it's really important to point out that the mandatory wait period for most insurers is four to six months. So if somebody wants to go in and get a bariatric procedure today, lap, band, sleeve, bypass, whatever, it's going to take four to six months for them to get through that process. Behavioral analysis, physicals, Some people require that they go through medically managed weight loss to make sure they can't do that just one more time. But as we get through it, the main things that we're seeing now, remember, we only launched in October. In November, we launched harder because we got affiliate approvals from broadcast networks like ABC. And then December was a little light because of the holidays. We pulled back. But then in January, February, and March, we started advertising quite a bit. So if you start looking at that four- to six-month window, we're just starting to see those people get through the consultation and procedural volume list. But, you know, as we mentioned, we've had 250,000 people come to our website that weren't there with our baseline. We've had a 480% increase in requests for information on lap band, a 400% increase in warm transfers to consultations. And we have a pretty good conversion ratio there. So I can tell you that's all starting to come. But a lot of the practices are just now getting their feet back under them. Some practices haven't done any procedures since Christmas, just coming back in February and March. So they're just getting their staff back. They're just getting these consultations scheduled. They're just getting everything lined up. So right now, we know that those are starting to come through. We're seeing them. But what we can track all the way to that point is the warm transfer. And we work with the accounts. We have our field personnel working with the accounts to make sure they know how to process those warm transfers, how to turn them into consultations, how to turn them into procedures. So we'll start to talk about those numbers in a couple more months as they start to come in and we start to get more regular or normalized data points on that. But just looking at the way that everything kind of sifts through the system, we're very confident that the numbers we're seeing in the upper level, that's the website traffic, the leads, and the warm transfers, everything else will follow through. And over the next few months, we'll be able to report on what those direct correlations are because we have business associate agreements with all of our accounts, which means that we're within HIPAA compliance and able to track that information all the way down to actual procedures. So, again, that will be more normalized data going forward, and I think the next couple of months we'll put something out.

So, Bart, just to follow up on that, so did you say that maybe this is partly due to to Omicron, but were some of these procedures, which are obviously elective, were they put off in January and February to some extent because of Omicron or even patients that maybe were interested, even though it takes four to six months, just the normal flow of patients, was that just stalled because of Omicron?

It was definitely impacted. I mean, we actually started all the way back to December, you know, when Omicron started to hit. And, you know, hospitals and everybody have kind of gone through the process now, so they're a lot faster to start closing and reallocating staff and doing that. You know, they've learned over the last couple years what to do. So, yeah, we saw that, you know, staff was reallocated in different departments and hospitals. Some practices, their whole practice caught COVID. So, yeah, a lot of this was put off, but That's why we're starting to push the numbers so hard so that we can try to make up for that and try to get more people into the outpatient surgery centers and just trying to get the doctors to line stuff up. The one thing we did check is that with the practices, they are building their procedural load. And when they do get access, they're not losing these patients, which is key for us also because that's what tells us to keep the process going. We know that continuity builds the traction that's going to get us more procedures down the road with direct-to-consumer marketings. So we don't want to have any breaks in it, but we also have to make sure it's the wise thing to do. And we're confident of that because we're actually engaging with all of our accounts and making sure that they're not losing those patients. Those patients aren't going anywhere. They're not doing anything else. You may have a small percentage fall off, but we're going to capture them over the coming quarters.

Okay, that's great. And then as you've been getting the word out there among not just potential patients, but physicians, how many physicians have, that maybe used to do the LAPAM procedure but stopped, you know, as there wasn't a lot of marketing and training behind it, how many of them have signed back up and do you have that number or also the number of potentially new physicians, bariatric surgeons that have said, you know, we want to be We want to be a part of this process.

That's great. As we said in the past, we're going a different model. We're not putting 10,000 reps out chasing 100,000 doctors. It's expensive. It doesn't work anymore. You can't get access to them. They don't have the controls they used to at the hospital level. Driving the patient flow is what we can do. We only needed about 150 accounts across the U.S. to really be effective and to... see returns that make sense on this consumer investment. And so the good news is we had over 30 accounts come back since the program started. So in the last four months, we've had 30 accounts come back. We put them through refreshers, recertification, gone out, made sure that they were up to date on all the new collateral materials, how to process the leads, how to work with our tracking programs and our lead engagement companies. So that's a tremendous number, and that's just the first four months. A lot of these guys, I mean, we'll have to sit down and have a coffee some day. There's some funny stories. But guys who said they probably wouldn't come back until things really changed or until they had a lot of data. But the patient flow, I think a really good sign on the patient flow is that these guys are coming back now, and that's important for us. We know we're doing the right thing. And I mentioned earlier on the fireside chat I had today with Maxim is that... We are also tracking what the umbrella effect is on this. We've seen 1,300% increase in patients going directly to our website and going to the surgeon locator. So even if they're not coming through our system, we're still tracking them, and we're seeing the doctors come back and do that. The other thing that was really key is because of the traction we're getting, in February we went to an ASMBS leadership meeting, and for the first time in over a decade, they included us to present to their new fellows that are graduating because they're starting to really believe that the lap band should be something that's part of all practices and should be offered. So that's a huge sign that, you know, when the society starts to see it and start to recognize that it needs to be taught to the new fellows and make sure that they're aware of it, we provide training for them, that they see it as an important addition to patient treatment. So that's strong across the board.

That's great. And then last question, and I'll hop back in the queue. ReshapeCare.com. I know it's reimbursable, which is great. Have you rolled that out to primary care physicians yet? Where's that rollout in terms of the plan?

Yeah, we started to test that this past quarter with some different primary care or family care physicians. And it was very positive results. So we're working on the final aspects of the new model that we're going to to roll that out. We're focused on the main thing, and that's the lap band and the surgeons. But this is a great opportunity. We think that we can do it in a very non-dilutive manner. And we think that we can really start to access that market, which, as you can imagine, is, what, 350,000 general practitioners compared to maybe 3,000 bariatric surgeons. So this could really open a huge opportunity for us in You know, with the pandemic a year ago, the Harris Poll results came out that the average weight gain for an American adult was 29 pounds. That's a lot of people getting into that I want some help zone. And maybe they're not a bariatric patient level yet, but somebody who needs something like this. So as the physician-led weight loss solutions company, it's right down our alley, and it just actually helps to get more out of something we've already built and developed.

Right. And obesity is one of the comorbidities can have a negative outcome for people that have, that get COVID, right? Obesity is one of the comorbidities, one of the

Yeah, I think it actually magnifies the risk profile of COVID. You know, 78% of all patients that were hospitalized or died from COVID were overweight or obese. So besides hypertension, diabetes, and types of cancer, now the risk of COVID. People need to watch their weight. And when they start getting pre-diabetic, when you start getting 30, 50 pounds overweight, that's a huge concern. You know, diabetes is no fun, and it's dangerous, and it's costly. So Yeah, I mean, there's a lot of people that need help, and I think for us to expand that offering without having to put a lot of investment into additional resources really is something that's going to benefit our shareholders.

Okay, thanks. Bart, appreciate it. I'll hop back in the queue.

Thank you.

Thank you. Our next question comes from the line of Ben Hainer with Alliance Global Partners. Your line is open.

Good afternoon, gentlemen. Thanks for taking the questions. First off, I really appreciate all the metrics that you've been able to share on the marketing campaign. I think that's really helpful. But I'm just curious on the visibility that you've had historically in terms of, well, particularly in the case of warm transfers, what proportion of U.S. sales kind of have historically come through leads that you guys generated initially and I mean, is that something that you have some data on?

Yeah, none. Before the direct-to-consumer marketing, we only did a couple of test markets in the U.S. because we didn't want to spend a lot of money on it until we knew what we were going to do. But one thing we can do is go back to our historical data, too, and we look at the historical numbers. When the company started to do direct-to-consumer advertising on a national level back in 2006, 2007, 2008, That's when we had upwards of $70 million increases in year-over-year revenue. So we know that's what works. The test market showed that we can drive the website traffic, the lead volume, and the warm transfers. So we have an idea what those conversion ratios look like, but I think for us to put a number on that right now would not be – I don't think it would be good data until we start to see what normalized markets look like. But it's very positive. Even if it's low numbers, we know that we're going to have tremendous procedural volume increases. But we've been going through this pandemic. We just rolled out the program in October and November. To tell you what the bottom line number is going to be from warm transfer to consultation to procedures, we're going to need a couple quarters of normalized data to really start to talk about it. Okay.

And then just thinking about the Impressions that patients are seeing over time, you're, what, four or five months into this now, you know, are you seeing upticks in, you know, the number of inquiries, the number of, you know, surgeon locator searches, you know, that type of stuff as these, you know, would-be patients get more and more impressions of the advertising campaign, marketing campaign?

Oh, absolutely. I mean, we took our baseline from July, you know, after we got funded and after we got listed on NASDAQ, we created a baseline from July through September and then started to compare the data of the study and, I'm sorry, the campaign for advertising. And, yeah, 250,000 people to our website. It's a 480% increase in requests for information, a 400% increase in warm transfers to doctors. I mean, it's All of these are tremendous. And then what we're tracking on the outside from that umbrella effect I talked about is 1,300% increase in visits to our Surgeon Locator page. So people that are going outside of the lead tracking process are going straight to the Surgeon Locator page on our website. So it's very, very positive. And that's why the doctors are starting to speak with us about coming back or participating with it. It's why we're starting to get picked up by more channels and more magazines because they see the viability and the ethical way that we're doing it that it's going to have an opportunity to help a lot of people.

Okay, that makes a lot of sense. And then just for clarity's sake, so you're comparing versus July through September and But the metrics that you're giving, are those just for Q4, or do those include up until yesterday or last week or whatever? What time period are we looking at for the comparison?

Yeah, those metrics were through February. So we launched mid-October with a soft launch. It's a couple magazines. In November, we got most of our affiliate approvals for television, and we were semi-dark in December because of the holidays. Okay. That's the time period that we're comparing it to from the soft launch in October to the end of February and through the dark period for the holidays.

Got it. And then lastly for me, just on reshaped care, you know, what do you anticipate the contribution to revenue looking like this year? I mean, is it meaningful on its own or does it fall into, you know, kind of more of a supporting role in, you know, helping to drive lap band procedures?

I think it's a good support resource for us with the lap band. And remember, we're agnostic with reshape care. So it doesn't matter what procedure you had, even if you had it 10 years ago. If your doctor enrolls you, we'll support it. But I think that it'll start to generate more revenue towards the end of the year. Practices come back. They start getting patients enrolled. They don't really want everybody in their office right now. Patients don't really want to go into the doctor's office. So I think we'll see more and more And then as we start looking at this opportunity with kind of the medical physician practice level, that general practitioner, I think that can create a big opportunity for us. We've done some studies and some metrics and worked with a couple of key partners to understand what the viability of that looks like. And I think that by the end of this year, that reshape care will definitely be showing up on our revenue lines and start to carry its own weight. But right now, The two things doctors told us was, I want to do lap bands, but patients don't ask for it. Send them to me, I'll do them. We're doing that. Second thing they said was, help me manage those patients afterwards so that I'm actually able to get to the OR and do more patients. I want to do surgery, but I want the patients to do well, so we have to have help on that too. We can't encumber their practices with a deluge of patient volume. It has to be something that we do. So we're doing that. We're driving the consumers, and we're providing a program that helps them with that aftercare and then takes away some of that encumbrance. I think it's a wonderful thing that we've done during the last couple of years through the pandemic to develop that strategy and now to be able to execute upon it.

Excellent. Well, that's all I had, gentlemen. Congrats on the progress and the marketing campaign, and that's it for me. Thank you. Super. Thank you, Ben.

Thank you. I'm sure no further questions in the queue. I would now like to turn the call back over to Bart Bandy for closing remarks.

Thank you. I hope you can see that the steps we took in 2021 and over the most recent months have positioned Reshape for substantial growth going forward. We are very excited about what the future holds for Reshape and believe we are at the precipice of reaping significant benefit from our robust, multi-tiered direct consumer marketing campaign creating and expanding an awareness for our next-generation lap band program and suite of weight loss solutions for the millions of patients seeking an improved quality of life. Thank you to our employees, board members, customers, vendors, existing and new shareholders for your continued support of Reshape as we progress on our mission to become the premier physician-led weight loss company. We look forward to providing future updates to you.

Ladies and gentlemen this concludes today's conference call. Thank you for your participation. You may now disconnect.