Viveve Medical, Inc.

Good afternoon and welcome to Vaviv's third quarter 2021 financial results and corporate update conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. Please note this event is being recorded. I will now turn the call over to Jeannie Swindle, Vaviv's Senior Director of Corporate Communications. Please go ahead.

Thank you, Operator, and welcome, everyone. Before we begin, we would like to remind you that this conference call may contain forward-looking statements regarding future events or the company's future financial performance. Any statement that is not a statement of historical fact is forward-looking. This includes remarks about the corporation's projections, expectations, plans, beliefs and prospects. These statements are based on judgments and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are described more fully in the company's annual report on Form 10-K and other filings made with the SEC, which are also available on the company's website. Also, any forward-looking statements represent management's view only as of the date of this conference call and should not be relied upon as representing management's views as of any subsequent date. Speaking on today's call will be Scott Durbin, the VEEV's CEO, and Jim Robbins, Senior Vice President of Finance and Administration. I will now turn the call over to Jim.

Thank you, Jeannie. Good afternoon, everyone, and thank you for joining the call today. I will begin today's call with a brief review of our third quarter 2021 financial results. I will then turn the call over to Scott, who will provide a corporate update. Today, we reported total revenue for the third quarter of $1.6 million from the global sale of 16 systems and approximately 2,300 consumable treatment tips. As of the end of the third quarter 2021, the company had an installed base of 870 VIVI systems worldwide. Third quarter total operating expenses were $5.6 million compared to $3.6 million for the same period last year. The increase is mainly a result of the company's efforts to advance our stress urinary incontinence, our SUI clinical development program, and the pivotal pursuit trial in the US. We ended the quarter in a strong cash position due to our continuing operational measures to manage our cash burn. As of September 30th, 2021, We reported cash and cash equivalents of $22.7 million. Thanks. I'll now turn the conference call over to Scott.

Thanks, Jim. Good afternoon, everyone. And again, thank you for listening to today's call. I'd like to begin my remarks today underscoring the positive financial results and capital position of the company that Jim just reported on. Vaviv's continuing strong financial position this quarter is a result of the efforts of our entire organization, which maintains its focus on advancing our stress urinary incontinence program towards a potential future new indication. Initiation of our pivotal U.S. pursuit trial in the first quarter represented a critical milestone in that effort, and we are looking forward to achieving the next milestones in the coming weeks. completion of subject enrollment, and randomization of the planned 390 subjects in the trial. We have a high level of confidence in the strength of the pursuit study design and in our ability to execute our strategy to achieve a potential SUI indication in the United States. With the capital resources to support operations through the end of 2022, including the planned completion of the pursuit trial, Our strategic focus in the following core areas will continue to be, first, rapidly advancing the currently underway pursuit trial and achieving a positive data readout. If positive, preparing to commercially launch the first FDA-approved, patent-protected, endovaginal dual-energy office-based treatment for urethral hypermobility to improve SUI in women. Secondly, focusing our commercial and market development efforts on the United States and Asia Pacific regions through the expansion of our install base, targeting urogynecology, urology, and gynecology core specialties. And finally, third, supporting our customers with successful initiatives to continue to drive increased consumable treatment tip utilization and sales. As I previously stated, our entire organization is committed to these core areas of strategic focus, as well as continuing to achieve critical milestones as we advance our SUI clinical development program towards a potential new indication in the U.S. I'd now like to direct my remarks to the specifics of our pursuit trial for SUI. PURSUIT is a randomized, double-blinded, true sham-controlled trial with an intent to randomize 390 subjects with moderate SUI. Moderate SUI is defined as between 10 and 50 mLs of urine leakage on the one-hour Padway test at up to 30 study sites in the United States. Randomized at a two-to-one ratio, subjects in the active treatment arm will receive our cryogen-cooled monopolar radiofrequency treatment, or CMRF, while subjects in the control arm will receive an inert or energy-less true sham treatment. The primary efficacy endpoint of the PURSUIT trial is a comparison of the proportion of patients who experience greater than a 50% reduction in urine leakage compared to baseline on the standardized and objective one-hour Padway test at 12 months post-treatment, versus the inert sham procedure. The study also includes several secondary endpoints assessed using the one-hour Padway test, the three-day bladder voiding diary, and other behavioral and quality of life questionnaires. Subject safety will also be monitored throughout the study. As I previously stated, PURSUIT was launched in early 2021. and we are now nearing the end of subject enrollment and randomizations as of today's date. As of November 5th, over 15,000 women have completed pre-screening questionnaires, and nearly 3,200 were qualified for potential enrollment. It's imperative for me to underscore that the PURSUIT trial is highly powered with strict inclusion criteria for the proper diagnosis of moderate SUI. The trial was intentionally designed to better assess the primary efficacy endpoint and potentially increase the probability of a positive outcome. That said, pursuit enrollment currently stands at 986 patients, with 340 patients randomized as of November 7th, and an additional 95 patients are currently in screening. Based on these numbers, we plan to complete enrollment in the coming weeks, and to have randomized the planned 390 trial patients in the fourth quarter. Importantly, positive 12-month data results from PURSUIT may support a marketing application for a new SUI label in the U.S. To put this into perspective, SUI is a condition that affects an estimated 25 to 30 million women in the United States alone. Based on our estimates, this represents a $10 to $12 billion total available consumable market opportunity with few effective non-invasive treatments that exist to reduce leakage associated with SUI. As a result, a positive pursuit outcome and FDA approval opens a multi-billion dollar commercial opportunity for Vaviv. On the commercial and market development front, medical practitioners and clinics worldwide continue to show steady improvement in Q3. In the U.S. and Asia Pacific, our targeted regions of focus, many practices have returned to full operations, patient flow, and elective procedure volumes. Our dedicated customer care team in the U.S. and distribution partners internationally continue to provide high-quality service and support to drive increased Vaviv procedure volumes and treatment tip utilization. As I previously stated, our commercial and market development efforts in the U.S. and Asia Pacific are directed towards core specialties of urogynecology, urology, and gynecology. And although we have a very small commercial sales organization in the U.S. and Asia Pacific region, their efforts continue to show growing physician receptivity for our innovative dual energy technology. Our goal is to continue to increase awareness of and build upon our tradition of scientific rigor and the growing body of clinical evidence that supports the safety and efficacy of the VIV treatment. as we advance our clinical program towards a potential new SUI indication in the U.S. Strategically, as announced in early July, Vaviv successfully established a long-term pathway for potential future reimbursement by obtaining a new technology Category 3 CPT code from the American Medical Association for our non-invasive, single session, durable SUI treatment. Issuance of the code was supported by key medical societies and reflects the strong clinical evidence and potential benefit of our dual energy procedure for improving SUI in women. Recognizing that obtaining reimbursement is a long-term process, contingent upon a positive pursuit trial readout and FDA approval of an SUI indication, its pursuit strategically supports and expands our potential long-term commercial opportunity. and we believe the Vaviv procedure could ultimately become a preferred SUI treatment option that may be broadly covered by insurance in the future. The third quarter of this year was one of diligence and focus as the entire organization advanced our SUI clinical development program and successfully executed our core initiatives. Our focus through the remainder of 2021 is to complete pursuit enrollment and subject randomizations expand our install base in the U.S. and Asia Pacific regions with core medical specialties, support our existing customers to drive increased treatment tip utilization and sales, and to continue the operational efficiencies we have achieved that has lowered our cash burn rate considerably over the past year. In closing, I'd like to thank the dedicated team at Vivi for their continuing efforts this quarter and as well as everyone for participating in our conference call today. Operator, this concludes our prepared remarks. Thank you.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.