Silk Road Medical, Inc.

Good afternoon, ladies and gentlemen, and welcome to the Silk Road Medical's 2020 Third Quarter Earnings. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. If anyone should require assistance during the conference, please press star, then zero on your touch-tone telephone. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Ms. Caroline Paul. Ma'am, please go ahead.

Thank you, and thank you all for participating in today's call. Joining me are Erica Rogers, Chief Executive Officer, and Lucas Buchanan, Chief Financial Officer and Chief Operating Officer. Earlier today, Silk Road Medical released financial results for the quarter ended September 30th, 2020. A copy of the press release is available on the company's website. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that relate to expectations or predictions of future events, results, or performance are forward-looking statements. All forward-looking statements, including without limitation, those relating to our operating trends and future financial performance, the impact of COVID-19 on our business and prospects for recovery, expense management, expectations for hiring, physician training, growth in our organization, and reimbursement, market opportunity, guidance for revenue, gross margin, and operating expenses in 2020, commercial expansion, label expansion, and product pipeline development are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the risk factors section of our quarterly report on Form 10-Q filed with the Securities and Exchange Commission on August 13, 2020. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, November 10, 2020. Silk Road Medical disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. And with that, I will turn the call over to Erica.

Thanks, Caroline. Good afternoon, everyone, and thank you for joining us for Silk Road Medical's third quarter earnings call. Joining me is Lucas Buchanan, our chief financial officer and chief operating officer. Our third quarter results are a testament to our team's steadfast commitment to stroke prevention and the underlying severity of carotid artery disease. We achieved total revenues of $20.1 million, reflecting growth of 18% year over year. Our top line performance was driven by 25% growth in procedures for a total of approximately 2,825 in the quarter. With these encouraging trends, we remain cautiously optimistic about the fourth quarter, recognizing strength in procedure volumes and underlying demand, but also acknowledging the very recent trends and potential negative impact of the COVID-19 resurgence. That being said, we are incredibly proud to have recently crossed the 25,000 cumulative procedures milestone, a testament to our team's drive and the underlying market opportunity. Over the course of the year, we have been strengthening our ability to drive long-term growth. We are investing meaningfully in R&D initiatives, expansion of our commercial team, and the recent launch of our new website featuring our brighter campaign. The future of Silk Road is indeed bright. We are also positioning our leadership and organizational structure for growth ahead. As we announced earlier in the year, Andy Davis is spearheading our commercial efforts in the newly created position of Chief Commercial Officer. Andy continues to have a monumental role in our commercial success by driving safe, adoption of TCAR across the United States, while gearing up for future label expansions, product launches, and international strategies. We are also pleased to have announced Bill Whalen as our Executive Vice President of R&D. Bill brings two decades of scientific and development leadership to Silk Road, where he is responsible for advancing our pipeline and expanding our intellectual property portfolio. Bill has a passion for identifying and solving unmet clinical needs and a proven track record leading innovative R&D teams. He will be instrumental to our growth both today and tomorrow. And finally, I am excited about the promotion of Lucas Buchanan, who now has an expanded role as our Chief Operating Officer in addition to Chief Financial Officer. Lucas' deep knowledge of our business and strong leadership skills make him the ideal COO as we scale our organization and pursue new strategic initiatives while maintaining operational excellence. Turning now to the three strategic initiatives for 2020 that we outlined at the beginning of the year. We are making significant progress on all three. U.S. commercial execution, developing our strategy for label expansion and coverage for the standard surgical risk patient population, and further pipeline development. Starting first with U.S. commercial execution, we remain focused on our large untapped market opportunity to drive TCAR penetration in high surgical risk patients through increased physician utilization. while expanding our base of sales territories, hospital accounts, and trained physicians. We have continued to add to our talented commercial team and remain on track to end 2020 with 40 to 45 active territories. Our team has also done an excellent job training physicians in new and innovative ways that adjust to the realities of the COVID-19 environment. After the dip in training in Q2 that we talked about on last quarter's call, we have successfully pivoted to new methods, and we are quite pleased with our training progress in the third quarter. Demand for TCAR training remains strong. As further validation of our platform, we are also honored by the recent peer-reviewed publication of the ongoing TCAR surveillance project in Annals of Surgery in September, and our Roadster 2 study in the American Heart Association's journal, Stroke, this past July. These datasets in high impact factor journals enable the benefits of TCAR to reach a broad base of referring and treating physicians across the stroke care continuum, and further validate our ever-growing clinical evidence base as it reaches payers, regulators, medical societies, and other critical stakeholders. Collectively, these papers represent over 7,000 patients' worth of data published in just this quarter. In this business, clinical data is a major tailwind for long-term growth. And now, shifting to our second key priority, providing more clarity on the regulatory and reimbursement strategy for standard surgical risk patients. We continue to make meaningful progress on our ongoing discussions with key stakeholders, including the FDA. As previously disclosed, we have been targeting the end of this year to discuss our strategy in this area in more detail. While nothing substantive has changed in the assessment of our strategy, the process of working through it with the FDA, CMS, and the Society of Vascular Surgery is simply taking more time. As a result, disclosure of our strategy is likely to occur after the end of the year. Our goal all along has been to reach an optimal path forward to obtain not just expanded FDA label, but also Medicare coverage and ultimately adoption. And we remain on that path. Finally, our third strategic priority is focused on continued pipeline development. We consider ourselves experts in trans carotid access and neuroprotection, and we have made meaningful progress on product development, not just for TCAR, but also in acute ischemic stroke. We are expecting to move into clinical and regulatory activities for our neurovascular program next year. While much has been achieved in acute stroke thrombectomy in recent years, significant unmet needs remain in terms of patient outcomes. And we are excited about the potential for trans-carotid therapies to usher in a new paradigm. In summary, we are continuing with our progress on our long-term initiatives and we believe our opportunities in stroke prevention and acute stroke treatment are brighter than ever. With that, I will now turn the call over to Lucas to review our financials in more detail.