Artivion, Inc.

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. I would now like to turn the conference over to your host, Lane Morgan. Thank you. You may begin.

Good afternoon, and thank you for joining the call today. Joining me today from our Trivian's management team are Pat Matkin, CEO, and Lance Berry, CFO. Before we begin, I'd like to make the following statements to 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 involve risks and uncertainties in our forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements made 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 filing and in the press release that was issued earlier today. You can also find a brief presentation with details highlighted on today's call on the Investment Relations section of the Artivian website. Now I'll turn it over to Artivian CEO, Kat Mackin.

Thanks, Lane, and good afternoon to everybody. We're very pleased with our Q2 performance, which capped a strong first half of 2024 for Artivion, with which we made significant progress on our commercial, operational, and financial goals. In the second quarter of 2024, we delivered constant currency revenue growth of 10% year-over-year, representing $98 million in revenue, and adjusted EBITDA growth of 35% year-over-year, compared to the second quarter of 2023. More recently, we amended our credit facility and option purchase agreements with Endospan. The amended credit facility provides Endospan with additional funding subject to progress towards completion of the Nexus PMA, while the amended option purchase agreement significantly improves our acquisition terms for Endospan should we elect to exercise our option. From a financial perspective, our Q2 performance was led by Onyx, which grew 15%. followed by stentgrass, which grew 13%, and bioglue that grew 12%, followed by tissue processing at 7%, each when compared to the second quarter of 2023, all on a constant currency basis. In the second quarter, we also continue to benefit from our regulatory approvals in commercial footprint expansion in key international markets, especially in Latin America and Asia-Pacific, As a whole, our results and regulatory achievements further validate our growth strategy, and we remain laser-focused on expanding access to our differentiated product portfolio in existing and new markets. From a product category perspective, as I just mentioned, ONIX revenues increase 15% year-over-year on a constant currency basis as we continue to take market share globally with the only mechanical aortic valve that can be maintained in an INR of 1.5 to 2.0. Based on feedback from the field, our recent market share gains, and the proven clinical benefits of the ONIX aortic valve, we maintain our strong conviction that ONIX is the best aortic valve on the market and will continue to take market share worldwide. Meanwhile, as I indicated earlier, our StentGraph revenues grew 13% on a constant currency basis in the second quarter compared to the same period last year. Our StentGraph portfolio remains a key component of our growth strategy, And we are encouraged by our strong results, which are driven by our differentiated product portfolio, focused on the more complex segments of the StentGraph market. Today, the products in our StentGraph portfolio are primarily sold in Europe, where we leverage our existing direct infrastructure, sales infrastructure, and create a significant cross-selling opportunities across our unique aortic products offering. Our pipeline consists largely of bringing these proven products to the US and Japan markets, which represents a significant growth opportunity. We also saw strength in BioGlue during the second quarter, which grew 12% on a constant currency basis. As we have discussed previously, we expect to see some variability in the growth rates of BioGlue from quarter to quarter, driven by the significant amount of stocking distributor business in this product line. On an annual basis, we expect BioGlue to grow in the mid-single-digit range. Lastly, on tissue processing, our revenues grew 7% year-over-year on a constant currency basis in Q2 as we annualized the benefits from last year's pricing initiatives. We continue to expect the tissue business to grow double digits for the full year of 2024 as we further leverage increased supply of our proprietary Synagraph pulmonary valve and continue to benefit from our higher RAS procedure volumes. For those unfamiliar with the ROS procedure, it's a double valve procedure in which the patient's native pulmonary valve is replaced by the patient's defective aortic valve, and then the patient's pulmonary valve is then replaced by a donated pulmonary valve. The ROS procedure is considered the best option for young to middle-aged patients with a diseased aortic valve, as it provides the best option for these patients to have a normal life expectancy. The use of the ROS procedures increased rapidly over the last couple of months and years due to significant long-term data demonstrating these significant clinical benefits. Our Synagraph pulmonary valve has no competitive alternative and is the market leader in allografts used in these procedures. Further, revenues in the second quarter were also driven by our continued progress and growth in Latin America and Asia Pacific, primarily through new regulatory approvals and commercial footprint expansion. Latin America and Asia Pacific delivered constant currency revenue growth of 25 and 15 percent, respectively, compared to the second quarter of last year. We continue to anticipate strong revenue growth for both regions for the full year and over the coming years as we continue to leverage our industry-leading product portfolio in these regions. We are also excited about the progress of our partner, Endospans, continuing to make on the US IDE Triumph Trial, for the NEXUS aortic arch stent graft system. As of today, there have been 50 of the 60 primary endpoint patients enrolled in the chronic dissection arm. Given this current enrollment, patients are scheduled for procedures. We expect to complete this trial by the end of 2024. Assuming the trial endpoints are met, NEXUS remains on track for approval in the second half of 2026. As a reminder, Aortic arch disease patients with aneurysms and dissections who receive treatment have previously had little choice before Nexus, but to undergo open chest surgery, which is an invasive and risky operation associated with lengthy hospitalizations and prolonged recuperation. Nexus is a highly differentiated technology that transforms a complex surgical aortic arch repair into a minimally invasive endovascular procedure. In 2019, we secured exclusive distribution rights for Nexus in Europe and began leveraging our existing European direct sales organization to expand access to the technology and drive revenue growth. Based on our experience in Europe, we continue to see a significant global opportunity for Nexus, which has been estimated on an annual global basis to be around $600 million. Also in 2019, we provided a credit facility to Endospan to support the Nexus USID trial and commercial operations. We also had entered into an option agreement to acquire Endospan until 90 days following the receipt of an FDA approval for Nexus. Recently in July, we amended these two agreements, which has resulted in three major changes that Lance will cover shortly. We view our revised agreements with Endospan as an investment in the next frontier of aortic arch surgery. We also view it as a potential opportunity to meaningfully expand our total addressable market on significantly more favorable terms than we had before. We also continue to anticipate PMA approval for AMDS in 2025, which as we have discussed, would open up an addressable market here in the U.S. for about $150 million with no competitive alternatives. In summary, we are very excited about our Q2 performance and look forward to sustaining our momentum throughout 2024 and beyond by driving continued growth in onyx, stent grafts, and our synegraph pulmonary valve business, and by further expanding our global footprint in Asia Pacific and Latin America. With that, I'll now turn the call over to Lance.