Q3 2023 PetVivo Holdings Inc Earnings Call
It will probably wait a minute or so just to let everyone get on the call. So I will start in about 60 seconds.
Yes.
Okay.
Okay.
Okay.
Well, let's begin here.
Greetings and welcome to the Pet Libre Holding's third quarter of fiscal year 2023 financial results Conference call.
My name is John Dolan, the Chief business Development Officer, and General counsel at Pet vivo.
Today's call is being webcast and will be posted on the company's website for playback.
Before we begin I would like to remind everyone that comments made during this conference call that Pepe most executives may contain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.
Subject to risks and uncertainties any statements that refers to expectations projections or other characterizations of future events, including financial projections or future market conditions is a forward looking statement have.
A fever was actual future results could differ materially from those expressed in such forward looking statements for any reason, including those listed in its SEC filings.
Placebo assumes no obligation to update any such forward looking statements.
Pet legal filed its earnings release and Form 10-Q, with the SEC today, which provide a detailed script discussion of our financial results. These documents can be found in the SEC website in the Investor Relations section of our website.
I would like to now turn the call over to John lie the CEO and president of Pet vivo. Please go ahead John .
Thank you John and welcome also joining me today will be Bob Phillips, our Chief Financial Officer.
I would like to begin by discussing some highlights from last quarter, then Bob will discuss our financial results in greater detail I will conclude by sharing some additional thoughts on our business strategy.
Key focus areas for fiscal 2023 before we open the lineup for questions.
Our key highlights for the third quarter of fiscal 2023, where we reported revenues of 510000 as compared to 51000 in the third quarter of fiscal 2022.
Revenues for the third quarter included net revenues of 457000 from shipments of spring two MW I animal health subsidiary Amerisourcebergen, they're our exclusive distribution partner.
<unk>, which we signed a June 2022.
We continue to expand our national presence highlighted by our attendance at the American Association of Equine practitioners annual conference in November of 2022, which Doctor Manning, our senior technical veterinarian a.
Dennis Theater, albeit presentation actually two theater presentations, where we did get very good response, and we opened accounts and are.
Over 47 states.
We are starting to see the results of the investments we've made.
And expanding the awareness and efficacy benefits of spring with companion animals.
I would like to now turn the call over to Bob folks, our Chief Financial Officer, who will discuss our financial results.
Thank you John and good afternoon, everyone.
For the three months ended December 31st 2022, we reported revenue of 510000 Geos compared to 51000 in the prior year.
And as John noted this increase was driven by revenues of 457000 related to shipments of spring two MW IDE.
For the nine months ended December 31st.
2022, we reported revenues of 792000 as compared to 60000.
In the prior year period.
This increase was driven by revenues of 575000 related to shipments of spring two MW I.
At December 31, 2022, the company had 375000 in cash and working capital of 131000.
In January of 2023, we raised approximately 1.4 million.
After deducting transaction expenses from the sale.
Just over 610000 shares of our common stock in a registered direct offering at a price of $2 32 per share.
We also entered into a lease agreement for approximately 14000 square feet of production and warehouse space.
This new facility will include multiple clearings for large scale production of spring as well as other medical device and therapeutics and our product pipeline. We plan to move all of our production from this facility beginning in August of 2023.
And just to conclude here, we continue to invest our resources to expand our sales and marketing efforts clinical.
Clinical studies and manufacturing capacity to gain acceptance and support increased revenues from the sale of spring.
So now I will turn the call back over to John .
Thank you Bob.
I would like to talk about our business strategy and key focus areas for fiscal 2023.
The first one is to generate clinical evidence to support the equine and small animals markets. So we have a whole series of studies that we have commissioned last year over year before that many of them are coming to conclusion and all for fiscal 2023 we expect quite a few of these genes.
Good.
To become public through publications as well as presentations.
We're also.
Focus on hiring to have at least two additional territorial sales managers business development managers to focus on our relationship with them Wi expanding that relationship.
Another focus for us we talked about doing.
Promotion awareness of spring at these major conferences, we kicked off the conference.
Seasoned at the.
Veterinary medical Expo in Orlando.
What we're seeing with because we had talked about focusing on getting more podium presentations, even though we then officially do a podium presentation at ash event.
Couple other veterinary doctors that were during presentations brought up our product and top kind of talked about the success that we're having so are both got inundated with a bunch of veterinary doctors as well as bad tests.
Substantial big numbers.
As well as at the AEP with Doctor Manning did.
It is theater presentations, both days the theater, whereas for the capacity, which in that places probably about 100, that's our we were standing room, only and lot of those so.
We continued to invest in those presentations at the various trade shows and coming up in mid March is our first small animal.
Presentation by Athos to one of the major.
Nationstar, the veterinary orthopedic surgical association I think that once mid March. So we believe that will provide even more evidence and more podium presentations that will draw awareness in the marketplace.
I would like to now turn the call over the John Dolan, who will provide an update on our clinical studies clinical data derived from these studies about the efficacy of spring.
And will be helpful to gain more acceptance from the veterinary doctors.
<unk> go ahead.
John .
We have a robust upcoming year when it comes to clinical trials Pan vivo has a total of seven clinical trials in progress at this time, five small and small animal clinical trials, ie canine and feline and two <unk> clinical studies.
We are fortunate to be working with a number of world renowned research organizations, such as Colorado State University ethos, Veterinary health and inactive Inc.
We anticipate public disclosure of these clinical study results to begin in March 2023, and continue intermittently throughout the remainder of our next fiscal year.
The company plans to organize and conduct more clinical studies. In addition to the ones in progress in order to support our relationship with them and Wi and game that acceptance of spring.
I'd like to turn it back now to John Lyon.
Thank you John I would like to now open it up to a Q&A session. Operator will you. Please explain to the callers or are people that are online and what they need to do to ask the question.
Absolutely if you would like to ask a question at this point. Please just take your question into the ops and also click the button to raise your hand, I'll look fire raised hannon Connie if you are dialing in today's call the process is to.
Start nine in order to raise your hand, and then once prompted hit star six two and mute yourself. So that you can ask your question.
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Hello, Milan.
Yes, you are.
Hey, junk Joseph Darling.
John .
That was great I think it was a great start.
Chip what underlies our congratulations as well.
Takeoff.
I was fortunate enough to visit all over the world the question village.
<unk> got a chance to talk to somebody MW I guys and they tell me it's doing great. So congratulations thank you.
Hopefully, though.
You'll see a very big ramp up as they go out go throughout the distribution.
Oh.
The can you basically just talk about the size of the <unk>.
The markets in terms of the number of animals in each of the markets that you're I guess between too small.
All animals that also the horses.
Differentiation between.
Is it a show Horst.
Market versus the pet market because that way people can get a better idea.
The number of animals that MW is going to be helping to get get access to it how.
How many beds service all these people.
So the <unk> relationship is working out extremely well for both parties and we're both very happy because what happens before every one of these shows.
MW Eidos business slipped by 90% of the veterinary doctors in the United States, where they have accounts. So they would do a promotional email for us to the best that they know are the bed tax that are coming to the show.
Give him a little highlight about spring and they should drop by our booth. So so that's a very good.
Introductory approach for us so the size of the market you know it.
In terms of dogs in the United States, there's about 64 million dogs.
About 53 million cats, and the numbers for horses range anywhere from <unk>.
<unk> 8 million to 14 million odd just depending on the source because there are quite a bit of wild horses out there too.
Currently I would say.
Is that the product mix or the revenues are majority of it are coming from the E client space just because of the.
The VAT state tend to see the horses aligned more often than they are a small animal back does the injection. They don't see them for awhile and also the small animal side will pick up.
Second half of 2023 on a calendar basis.
Because once those studies start coming out the M. Wi reps now will have.
Data to be able to get to the smaller animal bets.
The market is quite large.
In terms of OE.
Lameness and potential rehab markets I mean, it is north of $4 8 billion a year in the United States.
So I hope that answers the question.
Yes, it does.
Okay.
Is there any other.
Organic basically organically derived.
Products that are out in the marketplace.
A gain from the veterinarian.
Medical devices right now, whereas it was pretty much an.
The open market for you guys.
So I feel our product is quite disruptive and unique in the sense that it deviates from what everyone else has been focused on our product is targeted at the direct cause of osteoarthritis and other lameness issues, while competitive products, our focus had more treating the <unk>.
Symptoms, while our focus at the actual disruption of friction between bone on bone context. So I feel we're unique in that sense and that's what becomes part of the educational process because when a veterinary doctor leaves that school they learn.
That it's a lifetime management in our of osteoarthritis and to multimodal approach using Nsaids then you move on nausea, and asset and you go on steroids and then eventually stem cells are enjoying replacement, we're actually disrupting and changing that equation because we feel once.
The spring particles are injected into the joint Youre going to lead to a tremendous reduction in the need of any <unk> or any of the other materials or complete elimination of it which helps reduce the side effects onto the horse because every all these other items Arab long term nature.
There are effects and side effects, while ours is purely neutral and that's how we got the veterinary device designation.
And years ago, there was a company I got involved with very early that turned out to be a major a monthly call bio matrix.
They get to the hyaluronic acid into the actual quarter, one that was already leaking.
The problem with that is obviously play, including Aaron's illegal gloom here heaps.
Keeps out.
It could be fair to say that.
It seems like a.
A cartilage type material.
Excellent.
Jackie differently, Hyaluronic, which is actually well no.
Use of it.
Equine as well you will eventually but point is.
Isn't that a fair way of looking at that you're not thinking the leakage that you would normally get with the hyaluronic acid coming out of the car which will.
Yeah.
Third litigation duration is the key here so once our particles called zelle debt, our matrix particles start forming a scaffold, which actually in essence over probably the next month or two.
But join actually improves while after using other products that are focus on symptoms. They tend to diminish after the initial injection and each time, we're using an H a product you're probably diminishing the efficacy as well as the soft tissue.
Yeah.
Okay.
The same type of look things like below the biometric side I think we could easily suppressed.
Thank you John would you like me to add a little bit to the sure go ahead.
Actually you're exactly right. When you were talking about medical devices. There are a few products in the market that have been classified as a medical device colleague lie can for example is one and the HVA products a high risk and those same products out there that that you've already mentioned our are also considered that.
John has hit it on the head though.
Many of the products that are on the market are trying to address certain symptoms that.
Undertaking place when you end up losing her having damaged cartilage for example, lubrication of the joint if you put <unk> into a joint Youre looking to lubricate that joins.
The issue is you're exactly right also within probably 48 hours that H a is out of the joint you may get some beneficial results for maybe a couple of months, but then you end up losing the effectiveness of that particular medical device now John I said it on the head with arc <unk>.
What we're doing is we're injecting a solid into the join a particular that sponge like that fills in all the gaps in the cartilage. So.
So when I when I say, it's a particle the nice thing about that is that it is large enough where it can get by the synovial membrane. So it stays inside that joined thereby filling in all the gaps. So in other words as Jonathan mentioned before you're you're treating the affliction or youre addressing the affliction by recreating that.
Cushion between the blocks.
We have another question.
Thank you.
Yes.
Okay.
Go ahead for the number Andrew and basics has now please.
Please <unk> yourself.
Perfect.
Hi, Dave damning, congratulations gentlemen on an excellent quarter.
Just had a question along the lines of.
Hum.
From past Investor presentations.
You have a robust manufacturing facility with about a half million unit capacity of $100 million in revenue.
Estimated from that.
Current production facility has anything changed as far as that capacity capability or what.
<unk> has prompted the expansion into another facility at this point in time.
Well thanks for the question David Silva.
The expansion actually if you look at it has multiple clean room.
And potential for.
While we called current manufacturing practice current good manufacturing practice certifications. It has the ability to scale a much higher volumes.
With the addition of automated equipment also that is clearly identifies.
Future potential product pipelines to winter there because if you're just using our current facility you would have to shut down the manufacturing of spring for the next product pipeline and then rotate back and forth. So there's tremendous efficiencies and scalability in this new facility and you would see that it's probably.
Three and a half times the <unk>.
Size of what we currently have from a production standpoint.
So that's one way to answer it. So so we're just really positioning for the future growth potential future rapid growth.
Excellent so what particular products, where do you have in mind them to be.
Simultaneously scaling in a facility that can occur.
Serve both of those and results. So we're not moving into the other facility until probably August .
And as you can see on our studies.
Everything is in.
Equine.
Canine and feline. So we'll have those products out the next year, we could have a couple of other products that were ready to act directly as a rollout any time, we just have to have studies to support it. So we need to prep for that and have that place ready.
Terrific. So you it gives you some bomb.
Dual paths leverage ability in your facility is kind of net net of that yeah, absolutely and also in our disaster recovery type potentially off situation. So so we won't get disrupted in the spring aspect a matter what well I shouldn't say you could have a major disaster, where a lot of stuff could taken.
But otherwise it when we're doing the right thing to make sure we don't interrupt spring.
With the momentum we have going right now because we're seeing a lot of veterinary doctors now actually putting up videos of success stories of dogs and horses and some veterinary doctors are actually started to inject some caps and see really good results in the notes videos are very powerful.
When they are coming from Nevada themselves to let that left the public another veterinary doctors know Ah.
How well the product is working.
Terrific. Thanks for the overview. Thank you.
We are now, allowing the number ending in nine one southern girl.
Oh.
Go ahead.
You have yourself by agile perfect.
Hi, My name's colon cancer Gal just want.
I need to call. It real quick list of a question first off congratulations on the great quarter.
Alright.
Yeah, Hi, good evening product backpack program.
On a.
Family friendly rainforest.
The portion of Capex plans of horror stories did very very well and ended up with about ankle ankle became sizable Paul just clean really run anymore. One in Jackson.
And he performed incredibly just a week later and then ended up winning quite a few races left in the last.
Four months or five months.
Okay.
Five months out from Jackie now and we always think gain that you know it would be time for another one start wearing off and the results are just getting better.
Yeah, well that you know maybe that.
Protein matrix has.
You know started to rebuild the joint and very surprised I really thought we'd be ready for another injection.
But.
My father.
Now at the very high level of veterinarian M B three.
Or evening World and he's just he's selling crashed on United has never seen anything like this before.
So I, yeah I remember.
Remember the early onset they didn't believe this stuff would work.
No.
We did it.
Yeah, it's like an incredible step up from what we were using before the cornerstone overtime as Nancy we now integrate the diet.
Okay.
What we understand about this is just not going to be the case, which is huge for longevity by $300000. Jorge you want it lapsed.
Correct.
You know, we say generally it lasts a year. It all varies we have seen that last well beyond a year and we're comfortable saying a year because when we did the human studies on the human side, we track to humans for a year and we're able to identify the particle store in the body.
So we have seen situations where.
And birth defect puppies, where they came of age where everything is pretty grown in we've done injections of defective hips, where the part of causes so far last at eight years, which was really surprising so so and I talked about the improvement after the matrix.
Going into the joint once that's gasoline starts to formulate.
It tends to keep the joining functioning even better. So when you first have the ingestion and the horse I kind of said you wanted to wait 10 days, but I guess the trainer and your dad said it was okay to let the horse running after a few days, which kind of surprised me, but the horse that extremely well.
EBITDA here, an incredibly I you know my dad wanted to wait by the trainer you know they there that's their livelihood. So he wanted the horse right back on the track and what was that.
Gosh, a month month or two ago. He he went as fast as we ever had in the last two years.
Five degree weather and just won the race, that's fine and I think there are 20 lengths between him and ask Mark I have just absolutely incredible well that's great to hear thank you.
Yeah.
Are there any more questions.
Okay.
If not.
So there is one more in there.
I think he already.
Okay.
And will allow him to talk if Keith I see another one just came up.
Yes.
And Sonic.
On mute yourself.
Yes.
Thanks for the call.
My.
<unk> relates to if you could just go over your again your burn rate.
And then also.
Your milestones what are the milestones that are sort of in progress or.
That you see developing over the next 12 months.
Okay.
So Ed we stated probably back in August of 2021, one who went on NASDAQ if you'd look at the Powerpoint from back then the milestones were kept these studies out because the studies are low.
Our regional sales reps to work with the <unk> sales reps to point to specific data too.
Two the vats and those mouse, we believe there'll be very good adoption for the for the canine side once that gets published so Jim Dolan Doctor seven of them that are in process. So we feel there's multiple milestones from that standpoint.
Well.
So these papers will get published so that will also help in the adoption or the burn rate I think it's probably around $2 million.
Per quarter.
Bob you can comment on that if I'm not too far off but I kind of recall looking at that that was the type of number.
Yes.
<unk>, yes.
Okay.
Okay, and then the mouth, so timing on those clinical trials and studies.
Can you give us any kind of time frame timetable.
Hi.
We compete are completed the ethos, one which was on torn cruise chefs in dogs, because we're focusing each study and a different joint so.
That one was completed in Nevada tober, the first cohort.
And.
The clinic tuition have requested you'd be able to present at the veterinary orthopedic surgical or any.
Annual conference, which is mid March so that's coming right up.
And I think.
I second Oswald because we don't get to see the results of the study that they're actually getting to percent there because that's a board certified surgeons.
So so so it's a pretty prestigious organization and once that gets presented will have an abstract for the salespeople to use.
And.
On top of that our ethos is a very well respected private research organization. They do work for Merck animal health awareness and so on.
They're owned by N V a national Veterinary Association.
The parent actually owns 2000 small animal vet clinics. So I feel worse given also a emphasis for the mwr sales reps to go into those clinics and start converting so what we're seeing.
<unk> really made good inroads in getting to the veterinary doctors because.
Recent rounds of ordering have been very small unit volumes. So you usually see a vet order one to three syringe based on the first turn than 45 days later, a little longer they get reports back from the owners of the dog and the horses as much quicker than the next term we see a larger order and then he.
Essentially it gets up into in our 40 50 units a month or so so we're seeing that kind of progression. We're also seeing.
Very good adoption rate and what I mean by adoption rate is once the bed tries it.
Hooked on the product because they are seeing the benefits.
Did I answer does that answer your question that's great. Thank you. Thank you.
And we have a question from 917 now.
Go ahead.
Yeah.
Hello.
Yes.
I already spoke I'm not sure why it took me back in the queue. Okay. Thank you.
Thank you.
Our nine down eight one in July .
I think now we have a new question from.
Carl.
Go ahead.
Yeah.
Okay.
Hello.
Gerald you are on mute and if you'd like to ask your question.
Okay.
Oh.
Oh.
Oh.
Yes.
Okay.
Oh.
Is there another question, maybe remove Ireland he can log back in.
No I think and not that is the last one I believe from axiom capital. Okay. Thank you you just locked out and he is going to land back in Oh, Okay, we'll give them a minute.
Okay.
While while while were waiting for them I'll, just expand on a little bit more on the milestones.
Right now we're at a point its just basically.
Providing clinical evidence for the salespeople to convert more and more of the veterinary doctors into.
The channel purchasing our product and in small animal side, it's all data driven.
So we feel pretty good with the seven studies, we have that we have invested in from 2021 and 2022 that these will come to fruition here by the end of 2023 calendar.
Yes.
Do we have a excellent capital back.
Yes, one moment okay.
Okay.
Oh.
Oh.
Okay.
Yes.
Okay.
Go ahead.
And must be their internet connection in New York.
Hmm.
Okay.
It's now than you are and muted on our side.
I'll ask a question.
Okay.
Well you know if there are no more questions.
We probably should OLED I got one coming being typed in hanger.
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And then yeah, yeah, yeah, so somewhat god, they're having problems or theyre going to call me direct and ask whatever questions. They ask questions. Thank you.
Yeah.
So if there are no more questions.
We can end this call.
Okay.
Wherever one thank you for attending.
Operator please.
Officially in the car.