Artivion, Inc.

Good day, ladies and gentlemen, and welcome to the Artivion First Core 2023 Financial Conference Call. All lines have been placed on a listen-only mode, and the floor will be open for questions and comments following the presentation. If you should require assistance throughout the conference, please press star zero on your telephone keypad to reach a live operator. At this time, it is my pleasure to turn the floor over to your host, Brian Johnston, VP of Guildmark Group. Sir, go ahead.

Thank you. Good afternoon, and thank you for joining the call today. With me from our Tibian's management team are Pat Mackin, CEO, and Ashley Lee, CFO. Before we begin, I'd like to remind you that the following statements comply with the safe harbor requirements of the Private Securities Litigation Reform Act of 1995. Comments made on this call that look forward in time invoke risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements as to the company's or management's intentions, hopes, beliefs, expectations, or predictions of the future. These forward-looking statements are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from these forward-looking statements. Additional information concerning certain risks and uncertainties that may impact these forward-looking statements is contained from time to time in the company's SEC filings and in the press release that was issued earlier today. With that, I'll turn it over to Artivian CEO, Pat Mackin.

Hey, thanks, Brian, and good afternoon, everyone. I'm pleased to report that the first quarter of 2023, our business performed well, enabling us to deliver constant currency revenue growth of 10% year over year. Our strong performance was led by our ONIX platform, which grew 24%, followed by BioGlu at 8%, StentGraphs at 8%, and Tissue Processing at 7%, all compared to the first quarter of 2022 on a constant currency basis. Our first quarter success demonstrates that our strategy is working. Under this strategy, we're driving increased revenue within existing markets, as well as in new geographies through expansion of our commercial footprint and by expanding our adjustable markets through our additional clinical pipeline. To that end, we recently received an approval letter from the FDA for the per-clot PMA and expect approval for our recent female inspection once our recent inspection is finalized. leave us even more confidence in our ability to deliver on our financial commitments for 2023. Given our first quarter performance, we likewise are even more confident in our ability to deliver strong bottom line growth in 2023 and beyond. As you'll recall from our investor day in March of 2022, we've committed to delivering annual double-digit constant currency revenue growth through 2024 and are focused on driving further operating leverage across our business to deliver adjusted EBITDA, of $75-plus million in 2024. Our focus is clearly paying off. As I mentioned earlier, ONIX revenues grew 24% on a constant currency basis in the first quarter compared to the first quarter of last year. We saw double-digit constant currency year-over-year revenue grow within ONIX across all geographies. We remain confident that we'll continue to take market share globally with the only mechanical heartfelt that can be maintained in an INR of 1.5 to 2.0, Additionally, Stencraft revenues grew 8% on a constant currency basis in the first quarter compared to the first quarter of 22. Demand for a Stencraft portfolio remains high, and we expect it to grow even higher. As you may recall, to meet this demand, we hired additional staff in Germany last year who are now contributing to our increased Stencraft production and whose productivity we expect to improve throughout the year. As a result, we anticipate in 2023 and beyond being able to better meet the strong demand of our stent grafts and accelerate the growth in revenues of these products. We're also executing extremely well on our initiative to grow product sales in APAC and Latin America through new regulatory approvals and commercial footprint expansion. In APAC and Latin America, we delivered first quarter constant currency revenue growth of 18% and 34% respectively compared to the prior year period. We continue to expect these regions to be important growth drivers over the coming years. As I mentioned earlier, we expect FDA approval for PERCLAW soon. Following this approval, we will receive a $14.3 million milestone payment, none of the amounts owed to our former partner, and we'll begin shipping revenue-generating product to Baxter. As for Project Mitril, we're in dialogue with the FDA and look forward to potential approval in the second half of this year. As we mentioned in our last call, approval for ProAct Michelin 2023 is not factored into current forecasts and would represent further upside from our rather than growth outlook for 2023. In addition to our progress in each of these three initiatives, we continue to make progress on the AMDS trial. We've now enrolled 51 patients in the Persevere trial, which is our USID clinical trial for PMA approval. in up to 30 U.S. centers and approximately 100 patients who have experienced an acute type A dissection. The combined primary efficacy and safety endpoints of the trial are reduction in all-cause mortality, new disability and stroke, myocardial infarction, and new onset of renal failure requiring dialysis, and the re-expansion of the true limit of the aorta. We anticipate completing full enrollment in Persevere in the second half of this year. Following a one-year follow-up period and assuming the trial meets its endpoints, we anticipate we should receive FDA approval for AMGS in 2025. In addition, our partner, Endospan, is making progress on the USID called TRIOV for its Nexus Aortic Stent Graph System. In that trial, there were approximately 44 patients enrolled and treated, and a total number of 53 patients enrolled and approved for treatment. Endospan estimates enrollment completion later this year and PMA approval in 2025. Again, assuming the endpoints are met. To reiterate, if these PMA trials proceed as anticipated, we expect FDA approval for AMDS and Nexus in 2025. At that time, assuming we exercise our option for Endospan, these products would increase our adjustable market opportunity by an estimated $900 million. Looking ahead, we intend to build on our strong growth in 2023, but continue to drive growth in the onyx aortic stent grafts We have a clear differentiation in pricing power. We also expect to benefit further from our investments in commercial channels and new regulatory approvals in Asia Pacific and Latin America. With that, I'll now turn the call over to Ashley.