The Oncology Institute, Inc.

Good afternoon, and welcome to the Oncology Institute's third quarter 2024 earnings conference call. Today's call is being recorded, and we have allocated one hour for prepared remarks and Q&A. At this time, I'd like to turn the conference over to Mark Heppelheiser, General Counsel at TOI. Thank you. You may begin.

The press release announcing the Oncology Institute's results for the third quarter of 2024 are available at the investor section of the company's website, theoncologyinstitute.com. A replay of this call will also be available at the company's website after the conclusion of this call. Before we get started, I would like to remind you of the company's safe harbor language included within the company's press release for the third quarter 2024. Management may make forward-looking statements, including guidance and underlying assumptions. Forward-looking statements are based on expectations that involve risks and uncertainties that could cause actual results to differ materially. For a further discussion of risks related to our business, here are filings with the SEC. This call will also discuss non-GAAP financial measures, such as adjusted EBITDA. Reconciliation of these non-GAAP measures to the most comparable GAAP measures are included in the earnings release furnished to the SEC and available on our website. Joining me on the call today is our CEO, Dan Verdick, and our newly appointed CFO, Rob Carter. Following our prepared remarks, we'll open the call for your questions. With that, I'll turn the call over to Dan.

Thank you, Mark. Good afternoon, everyone, and thank you for joining our third quarter call. To start, as you know, we recently welcomed Rob Carter as our new Chief Financial Officer, and I couldn't be more excited about the expertise and vision he brings to the CFO role at TOI. With over a decade of finance leadership experience in the healthcare sector, Rob is a seasoned executive dedicated to driving financial excellence and strategic growth. He previously served as our SVP of Finance, where he oversaw corporate finance, financial planning and analysis, treasury, and investor relations. Rob has played a crucial role in shaping the company's financial strategy, and I look forward to continuing to work closely with him in his new role. I'd also like to thank TOI's more than 130 oncologists and advanced practice providers, as well as all of the teammates across our 72 clinics and corporate locations for enabling us to achieve another quarter of outstanding growth. During the quarter, We signed an additional three capitated contracts across two states, including both medical and radiation oncology services. We added a second capitation contract in Florida, which is direct to a health plan partner, as well as our first capitation contract in Oregon. Year to date, we have now signed 13 new capitation contracts across the organization. We also achieved certification to begin radiopharmaceutical therapy in our California radiation oncology practice. This will be an important driver of growth and margin for our radonc business going forward, and we are one of the few community-based practices on the West Coast to offer this service, which traditionally occurs in the hospital setting. Overall, revenue grew 21.8% in the third quarter compared to the prior year period. driven by an exceptional oral drug revenue growth of approximately 80%. We are continuing to set new monthly fill records and now project revenue of more than $75 million from our California pharmacy. Finally, our cash and cash equivalents, inclusive of marketable securities, increased $1 million compared to Q2 2024, marking our first quarterly cash surplus this year. We have taken proactive steps to further mitigate the impact of the reimbursement challenges on Part D drugs that we experienced in the first half of 2024. These steps include negotiating improved contracts, including revisiting agreements for volume-based discounts that could protect our margins despite lower reimbursement rates. We are also diligently pursuing cost optimization opportunities across our supply chain. And for our IV drugs, we're working with our suppliers to renegotiate purchase terms. Notably, this quarter we generated a 6% reduction in SG&A expenses compared to the prior year. This decrease is a direct result of our ongoing efforts to streamline operations, improve efficiency, and optimize our cost structure. Through some of the initiatives we discussed, we have been able to lower operating costs without compromising the quality of care or service we deliver. Our ability to grow the top line while reducing SG&A expenses is a testament to our team's focus on operational excellence and strategic execution. We are confident that these cost management efforts combined with our robust top-line growth, will continue to strengthen our financial performance and position in the quarters ahead. As I briefly noted earlier, I'm excited about the achievement of our full licensure to administer radiopharmaceuticals in our Southern California radiation oncology clinics. We are targeting a December go-live for this important new therapeutic service at TOI and expect adjusted EBITDA contribution of over $1 million from these services alone in 2025. With the recent execution of our capitation contracts, we expect significant improvement in our net loss in Q4 and beyond. The annualized revenue of the new capitation deals signed to date this year is over $50 million. We are well positioned to handle substantial growth in the markets we serve without needing to add more providers or increase overhead costs. On our last earnings call, we highlighted our ongoing review of strategic, financial, and operational alternatives. At this time, we've completed this process. We received interest in the company during the process, but not at the level that the Board feels reflects the value of the company. As a result, the Board has concluded that the best course of action currently is to continue to achieve performance and growth across our business in light of our recent positive business development activity and our optimism for 2025. Lastly, as you may be aware, NASDAQ requires listed companies to maintain a minimum bid price of $1 per share. Earlier this year, we received a notice from NASDAQ indicating that our share price had fallen below the $1 threshold for 30 consecutive business days, which triggered the standard compliance process. At that time, we were granted an initial compliance period of 180 days to regain compliance by December 17, 2024. We are expected to meet the continued listing standards for NASDAQ capital market companies and are planning to apply for a second extension by the current deadline. If we cannot regain compliance by December 17, 2024. In the meantime, I want to emphasize that we are highly focused on meeting the minimum bid requirement during our initial and subsequent compliance period, including the possibility that the company may need to affect a reverse stock split. That said, we are confident in our strategy to drive both operational and financial improvement. Now, I'll turn the call over to our CFO, Rob Carter, to provide additional details on our third quarter financial results, along with additional operational and strategic updates. Rob.