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.