Science 37 Holdings, Inc.

Greetings and welcome to the Science 37 third quarter 2023 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Steve Halper from LifeSci Advisors, Thank you, Steve. You may begin.

Thank you, Operator, and thank you all for participating in today's call. Joining me are David Coleman, Chief Executive Officer, and Mike Zernick, Chief Financial Officer. Earlier today, Science 37 released financial results for the quarter-ended September 30, 2023. A copy of the press release is available on the company's website. Before we begin, I would 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. These forward-looking statements are based upon our current estimates of various assumptions and 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. We encourage you to review our filings made with the Securities and Exchange Commission for discussion of these risk factors, including in the risk factors section of the company's most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today, and the company disclaims any obligation to update such statements for new information. We believe that certain non-GAAP metrics are useful in evaluating our operational performance. We use these non-GAAP measures to evaluate our ongoing operations and for internal planning and forecasting purposes. Information about non-GAAP financial measures referenced, including a reconciliation of those measures to the most comparable GAAP measures, can be found in our SEC filings and in earnings materials available on the investor relations portion of our website at investors.science37.com. I would now like to turn the call over to David Coleman. David.

Thank you, Steve, and thank you, everyone, for joining us today for our third quarter 2023 earnings call. I'm pleased to report another quarter of solid revenues with significant progress on profitability and cash management on our path to EBITDA positive and cash flow to break even by the end of 2024. Compared to the second quarter, third quarter revenue remained relatively constant, as expected. while we achieved significantly higher adjusted gross margins above 40%, gross profit growth of 10%, and adjusted EBITDA improvement of more than 30%, and at the same time, cut cash burn in half. These improvements are the result of the plans we put in place as we became laser-focused on our Medi-Site model, including investments in patient recruitment and quality, and the implementation of our near and offshore centers of excellence and the elimination of expenses that don't support our strategy. Focusing on the investments we've made in patient recruitment in particular, we've been able to significantly accelerate enrollment rates, which has helped us to drive revenue and customer satisfaction. We're crushing enrollment on studies right now across several therapeutic areas, including CNS, respiratory, oncology for diagnostic work, and cardiovascular. What's more is that our cost per patient recruited is 75% lower than it was in the first quarter, a big part of the reason for our gross margin improvement, which is at its highest level since going public. We've been able to do this by aligning our patient recruitment sources with our customer contracts, gaining more from our existing community of patients and providers, and significantly improving our patient conversion rates through ongoing process improvement. Gross bookings for the third quarter were $17.9 million, which was up more than 50% versus the prior year, but down more than 50% from the previous quarter, a result of similar seasonality trends we've seen in prior years, in addition to continued delays in decision-making. Similar to last year, we expect a much stronger fourth quarter as a result. As we close out the year, we expect that our third quarter bookings delays will have a modest impact on our 2023 revenue. and we're now expected to achieve between $58 million and $59 million for the year. We are adjusting our previous 2023 EBITDA guidance from a loss of $35 million to a loss of $32.5 million. We're also reiterating our guidance for the second half cash burn of less than $15 million, and we continue to anticipate exiting the year with more than $50 million of cash on hand. With continued progress on RFP volume and a growing qualified sales pipeline that was more than 33% higher for the fourth quarter than it was for the third quarter, we expect continued bookings and revenue growth in 2024 with a similar approach to expense and cash management. And we have been consistent in our communication that we expect to exit fourth quarter of 2024 even to positive with ample cash on hand without having to raise additional capital. With that, I'll turn the call over to Mike Zaranek, our Chief Financial Officer, to provide additional details.