Sanara MedTech Inc.

Welcome to the Sonara MedTech first quarter of 2025 earnings conference call. Please note that this conference call is being recorded and a replay will be available on the investor relations page of the company's website shortly. The company issued its earnings release earlier today. Before we begin, I would like to remind everyone that certain statements on today's call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For more information about the risks and uncertainties involving forward-looking statements and factors that could cause actual results to differ materially from those projected or implied by forward-looking statements, please see the risk factor set forth in the company's most recent annual report on Form 10-K. This call will also include references to certain non-GAAP measures. Reconciliations of those non-GAAP financial measures to the most comparable measures calculated and presented in accordance with GAAP are available in the earnings materials available on the investor relations portion of our website. Today's call will be hosted by Ron Nixon, Executive Chairman and CEO, and feature additional remarks from Seth Young, President and Chief Commercial Officer, Sam Mupala, President and CEO of Tissue Health Plus, and Elizabeth Taylor, Chief Financial Officer. I would now like to turn the call over to Mr. Nixon. Please go ahead.

Thanks, Operator, and welcome everyone to our first quarter of 2025 earnings call. Let me provide a quick agenda for today's call. I'll start by discussing a few of our financial and operational highlights from the first quarter. Seth will then discuss the commercial execution and progress made in our Scenera Surgical segment and outline the multiple growth opportunities we're focused on pursuing. Next, Sam will provide an update on our Tissue Health Plus segment. And finally, Elizabeth will review our quarterly financial results in further detail before opening the calls for questions. Beginning with our first quarter highlights, our Scenera Surgical team delivered net revenue of 23.4 million, representing 26% growth year over year. This performance was consistent with our expectations for the quarter and represents a strong start to 2025. Our net revenue growth is driven primarily by sales of our soft tissue repair products, which increased 28% year-over-year to 20.5 million. Specifically, we saw strong growth in sales of both our Celerate RX surgical and bio-search products, which continued to fuel our performance. We were also pleased to see contributions from sales of our bone fusion products, which increased 18% year over year to 2.9 million, with growth across multiple products in this portfolio. As Seth will discuss in detail, our sales performance reflects impressive execution by our Senera Surgical commercial team on our growth strategy. We remain excited by the large greenfield opportunity that remains ahead of us. In addition to our Senera Surgical segment revenue performance, We also enhanced our gross margins. Net loss for Senera Surgical Segment increased by $200,000 year over year to $600,000. And importantly, we were pleased to see Senera Surgical Segment adjusted EBITDA increased by $1.5 million year over year to $2.7 million. In our tissue health plus segment, we continue to invest in the development of this value-based wound care strategy as we prepare to launch our pilot program with a wound care provider later in the second quarter. We are in active discussions with multiple potential financial partners to invest in the execution of our tissue health plus strategy, and Ryan focused on allocating capital strategically and thoughtfully between our two business segments. In terms of our other operational highlights in the first quarter, As discussed in detail on our last earnings call, we enhanced our new product pipeline by securing the distribution rights to two additional technologies and expanded our senior leadership team with key appointments. We also amended the terms of our debt facility to provide increased financial flexibility as we execute our growth strategy. Lastly, our team has continued their work to strengthen our portfolio of clinical evidence. We look forward to having multiple clinical manuscripts submitted for publication in key medical journals in 2025. I'm proud of our entire team's performance this past quarter across multiple fronts and look forward to continuing our momentum over the balance of 2025. I'll now turn it over to Seth to discuss the commercial execution and growth opportunities in our Senera Surgical segment.

Thanks, Ron. As Ron mentioned, our Senera Surgical segment commercial team delivered net revenue growth of 26% year over year. This growth was driven by our team's execution with respect to the following three initiatives related to our commercial strategy. One, advancing and deepening our distributor relationships. Two, selling into new healthcare facilities. And three, further penetrating the existing healthcare facilities we serve. Beginning with the first of the three commercial initiatives, we significantly expanded our network of distributor partners. Specifically, at the end of the first quarter, our team had engaged and secured selling agreements with over 400 distributor partners, compared to over 250 of the first quarter of 2024 and over 350 at the end of 2024. As a reminder, our expanded distributor network provides us with increased sales coverage and presence in key markets across the U.S. Turning to our second commercial initiative, we continue to add new healthcare facilities to our customer base. by securing value analysis committee approvals and commencing sales to surgeons at these facilities. Over the last 12 months, our products were sold in over 1,300 facilities compared to over 1,080 facilities in the prior year period. With respect to our third commercial initiative, we increased our penetration of the existing healthcare facilities we serve by increasing the number of surgeons using our products within these facilities. While it's not our practice to disclose specifics related to our active surgeon user base, I'm pleased to share that we saw solid growth in the number of surgeon users on a year-over-year basis in Q1. With this as a backdrop, we're pleased with the execution of our team and the progress we're seeing on our commercial strategy. We believe our commercial performance speaks to the durability of our customer base, as well as the value that our Sonera Surgical products provide. As surgeons gain firsthand experience with the use of our key products like Celerate RX Surgical and BioSurge, the value they bring to their procedures often leads them to become dedicated long-term users. Looking ahead, we remain focused in 2025 on pursuing these three commercial initiatives to capitalize on the multiple growth opportunities ahead of us. I'll now take a minute to outline some of these growth opportunities and our specific plans to pursue them over the balance of the year. While we will continue to add new distributor partners selectively, given our progress on the front over the last 18 months, we are increasingly focused this year on onboarding our recently added distributors and positioning their reps for success in selling our products. Our existing distributor network represents thousands of third-party sales reps, Importantly, only a percentage of these reps are currently selling our products. This is especially true for our larger distributor partners and our distributor partners engaged in recent quarters. With this in mind, increasing the number of distributor reps selling our products within existing distributor relationships represents a significant growth opportunity for our organization. In 2025, our team is focused on onboarding, training, and providing the requisite technical support needed to help additional reps within each distributor to begin selling our products. In parallel, we will continue to focus on adding new surgeon users within the more than 1,300 facilities that we currently serve. The vast majority of these facilities are hospitals and importantly, our surgeon penetration within these facilities remains low. Adding new surgeon customers within our existing facilities continues to represent one of the largest untapped areas of growth for our organization. Lastly, we will focus on continuing to add new healthcare facilities to our customer base with a goal of selling into more than 1,450 facilities by the end of 2025. As a reminder, we have contracts or approvals with over 4,000 facilities. This represents a significant opportunity for our commercial team and distributor partners to begin selling into new facilities. For all these reasons, we continue to believe we're in the early innings of our commercialization effort. We look forward to capitalizing on the multiple growth opportunities ahead of us as we educate prospective surgeon customers about the benefits for our products. With that, I'll turn it over to Sam to provide an update on Tissue Health Plus.