Q3 2024 Axogen Inc Earnings Call
Good morning, everyone.
Speaker Change: Joining me on today's call is Michael Dale, Axogen's Chief Executive Officer and Director.
and Nir Naor, Chief Financial Officer. Michael will discuss third quarter 2024 financial results and Nir will provide an analysis of our financial performance and guidance and discuss our outlook for the year followed by a question and answer session.
Today's call is being broadcast live via webcast, which is available on the Investor section of AxoGen's website.
Before we get started, I'd like to remind you that during this conference call, the company will make projections and forward-looking statements.
Speaker Change: Forward-looking statements include, but are not limited to, all statements relating to financial guidance, including revenue, margins, cash flow, and future profitability.
Availability to fund ongoing operations.
The Availability to Expand Markets and Revenue, Expectations for Growth.
Marketing Opportunities
within existing and new nerve repair markets and applications.
and the expected approval of the Biologic License Application for Advanced Nerve Graft
Forward-looking statements are based on current beliefs and assumptions and are not guarantees of future performance and are subject to risks and uncertainties, including, without limitation, the risks and uncertainties reflected in the company's annual and periodic reports.
such as hospital staffing issues, regulatory process and approvals, surgeon and product adoption, and market awareness of our products.
The forward-looking statements are representative only as of the date they are made and accept as required by applicable law. The company assumes no responsibility to publicly update or revise any forward-looking statements.
In addition, for a reconciliation of non-GAAP measures, please refer to today's press release and the corporate presentation on the investor section of the company's website. Now I'll turn the call over to Michael.
Michael: Thanks, Operator. And thanks, everyone, for joining us today. I'll begin our call by providing a brief overview of our third quarter performance.
Following this, I will also provide some additional color on our quarterly performance, after which Nir will provide a review of our financial results, followed by a question and answer.
Michael: So let's begin. We are pleased with the quarter's top-line revenue and EBITDA growth. Revenue was $48.6 million, an increase of approximately 18% compared to last year, while adjusted EBITDA was $6.5 million versus $2.4 million last year.
Michael: Both Revenue and EBITDA were positively impacted by improved sales productivity and commercial execution of our present growth strategy.
Regarding the most common questions I'm asked, I'll begin with why oxygen?
Michael: Very simply, Oxygen as a business opportunity fulfills all three of the most important elements required for success, in my estimation. Firstly, the purpose of the business is credible and relevant.
Michael: Secondly, the clinical problem is numerous enough to justify the allocation of time, capital, and people to build a business. And finally, there is clear and compelling evidence the solution to the business purpose is distinctively advantaged relative to the existing standards of care.
Michael: Everything I've observed and experienced since joining the organization reaffirms this estimation.
Michael: While our future is obviously dependent upon execution of our future plan across business functions, these are mechanics I understand and have confidence in how to apply by function.
Michael: I learned many years ago, however, that good mechanics can't overcome an irrelevant purpose or undifferentiated product solutions.
Michael: I've had the privilege to test this thesis on numerous occasions over the last 30 plus years in both public and private companies.
Michael: leading and bringing to market numerous transformative products and therapies in the cardiovascular, neuromodulation, diabetes, and electrophysiology markets.
Michael: As for the remaining two questions, what have I been doing since joining the company and what is the plan for the business going forward? On day one, we established three priorities for the remainder of the year. Number one, successfully complete the submission of our BLA application.
Michael: Number two, meet our established revenue guidance for the year. And lastly, develop a new strategic operating plan for the business, engaging all employees and key external stakeholders in the process.
Michael: Consistent with the purpose of strategic planning and relative to the mission underlying our business purpose, our aim is understanding what are the necessary objectives
Michael: While we have one primary product, AVANCE, upon which the business was founded, the respective applications for AVANCE are numerous and constitute in many instances distinctly different market opportunities, characterized by different physician call points and requiring therefore different business models.
and the required business models and timelines for their development.
Michael: Returning to our quarterly results, as described in our earnings release, overall, we had a solid quarter, achieving several major milestones.
Michael: We are pleased with the positive trends in revenue growth, bottom line performance, and importantly, the completion of the rolling submission process and the acceptance by the FDA of the filing of the BLA for advanced nerve graft.
Michael: Our strategy remains focused on deepening our presence in high potential accounts, which are primarily characterized by the following criteria.
Michael: larger hospitals, including level one trauma centers and or academic affiliated hospitals with a high number of nerve repair procedures, and lastly, already trained microsurgeons.
Michael: We aim to drive growth in these types of accounts through targeted expansion of nerve repair indications by building on the existing experience in nerve repair in the account.
Michael: We believe our focus on these high potential accounts is the reason for our recent improvements in sales productivity in our extremities trauma and head and neck business in particular.
Michael: Regarding revenue mix, we saw broad base growth across the portfolio.
Michael: including an increase in nerve reconstruction cases in our targeted clinical applications.
Michael: such as upper extremity trauma, mandible reconstruction, and breast neuritization, as well as growth from nerve protection procedures.
Michael: Our growth in nerve protection is driven by adoption of our newest solutions, Axeguard H8 Nerve Protector and Evive Plus Soft Tissue Matrix, which gives Axogen the most comprehensive portfolio to address these common non-transsected nerve injuries.
Michael: During the quarter, we sponsored a national re-sensation breast program, as well as numerous regional surgeon education programs in extremities and head and neck. These programs are a key driver of new surgeon activation and broader adoption of our nerve repair portfolio.
Michael: In Q3 we also attended the American Society for Surgery of the Hand in Minneapolis. Nerve was an important topic at this meeting and we continue to see a growing interest in incorporating nerve repair among the hand surgeon community.
Michael: The data presented characterized the extent of nerve damage from common trauma injuries and was generated in collaboration with a leading group of hand surgeons.
Michael: This involved quantifying the extent of damage from common traumas using micro-CT and other advanced imaging modalities.
Michael: Importantly, these findings will help further the understanding of how these common traumatic lacerations lead to a more extensive zone of injury than previously appreciated as compared to a surgeon's traditional methods of visual estimation.
Michael: Zaderej, Harold Tamayo, Unknown Executive, Nir Naor, Peter Mariani, Adanna Alexander,
Michael: We also saw a presentation of data from a recently published meta-analysis comparing meaningful recovery rates of suture-only direct repair to connector-assisted repair.
Michael: The study findings reported significantly greater proportion of patients achieving meaningful recovery and higher levels of meaningful recovery when connector-assisted repair was performed compared to suture-only direct repair.
Michael: These data and publications highlight the growing understanding of nerve injury and the important role our products play in nerve repair.
Michael: Turning to the BLA for Advanced Nerve Graph, in September we completed the rolling submission process.
Michael: On November 1st, we were informed by the FDA that they have completed our filing review and have determined our application is sufficiently complete to permit a substantive review.
Michael: which allows for a timeline and approval with a review goal date of September 5th, 2025.
Michael: Additionally, they informed us that they are not currently planning to hold an advisory committee meeting.
Michael: Importantly, we believe advance will be designated as a reference product for potential biosimilars, providing at least 12 years of market exclusivity from the approval date.
Michael: In conclusion, we are pleased with our third quarter results, which reflect the successful execution of our current growth strategy and commitments to science-based education and market development.
Michael: Looking ahead, we remain focused on completing the BLA application process, meeting our revenue guidance for the year, and completing our new strategic operating plan.
Michael: I will now hand over the call to Nir, who will provide further details on our financials and full year guidance.
Nir Naor: Thank you, Mike. We're excited about our results for this quarter.
Turning to our financials.
Nir Naor: For this quarter, our revenue was $48.6 million, representing 17.9% growth from the third quarter of 2023. This growth is attributed to a 13.7% increase in unit volume and mix, and a 4.2% increase in price.
Michael: Higher unit volumes were driven by broad strengths across the existing product portfolio and momentum from new product introductions.
Michael: Our gross profit for the quarter was $36.4 million, an increase from the $31.7 million recorded in the third quarter of 2023.
Michael: This represents a gross margin of 74.9% down from 76.8% in the same period last year driven by product mix.
Michael: Notably, we saw a sequential increase from the prior quarter gross profit margin of 73.8% as we continue to make improvements in our operating processes at the APC facility.
Michael: Our total operating expenses for the quarter increased by 2.9% to $36.8 million, up from $35.7 million in Q3 of 2023.
Michael: Our sales and marketing expenses for the third quarter decreased by 1.3% to $18.9 million, partly driven by the advance royalty fee, which we ceased paying as of the end of last year.
Michael: As percentage of total revenue, our sales and marketing expenses for the third quarter decreased to 38.9% from 46.4% in the third quarter of 2023, also reflecting improved Salesforce productivity.
Michael: Research and development expenses increased by 4.5% to $7 million from $6.7 million in the third quarter of 2023.
Michael: As percentage of total revenues, total R&D expenses decreased to 14.4% from 16.2% in the same quarter of the previous year.
General and administrative expenses increased by 9.8%.
to 10.8
Michael: million dollars in the third quarter of 2024 compared to 9.9 million dollars in the same quarter of 2023 driven by stock-based compensation expense related to the departure of the former CEO.
Michael: Adjusted net income was $3.1 million for the quarter, or $0.07 per share, compared to an adjusted net income of $0.7 million, or $0.01 per share, in the same period last year.
Michael: Adjusted third quarter EBITDA was $6.5 million compared to an adjusted EBITDA of $2.4 million in the prior year.
Michael: These improvements in our bottom line profitability metrics such as adjusted EBITDA and cash flow reflect our ongoing efforts to focus to improve our operational efficiencies across the organization and our ability to leverage economies of scale.
Michael: We believe these improvements will enable us to fund our ongoing operations.
Michael: Turning now to our guidance. As outlined in today's press release, we are maintaining our revenue guidance for the full year 2024 in the range of $182 to $186 million.
Michael: We're pleased with our performance year to date and are optimistic going into 2025.
Michael: With regards to our full year gross margin guidance, we now expect to be at the high end of the 74-76% range we provided earlier.
Michael: Additionally, we are reaffirming that we expect to be net cash flow positive cumulatively for the period from April 1st through year-end.
Michael: In summary, we're pleased with our performance in the third quarter. We will continue to execute our strategies, invest in innovation, drive revenue growth, and optimize resource allocation and focus on profitability.
Michael: At this time, we'd like to open the line for questions. Operator.
Michael: Zaderej, Harold Tamayo, Unknown Executive, Nir Naor, Peter Mariani, Adanna Alexander
Speaker Change: Thank you. If you'd like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
Speaker Change: Our first question comes from the line of Chris Pusquell with Nefron Research. Please proceed with your question.
Chris Pusquell: Thanks. Good morning, guys, and congrats on the new position, Mike.
Chris Pusquell: I wanted to ask about the decision to just reiterate the full year guide considering that the third quarter performance came in above the implied second half growth rate and now what's left for the fourth quarter.
Chris Pusquell: is a pretty wide range and certainly below the recent performance of the company. So just anything you could tell us about the outlook there and whether there's something that's informing that or it's just conservatism. Thank you.
No, fair question. As I mentioned in my remarks.
Speaker Change: When I joined the business and started to get to know the team, the most important thing we believed was to demonstrate our ability to forecast predictably and to meet the public guidance which we'd already established.
Speaker Change: And so that's the commitment that we want to make to all of our stakeholders.
Michael: in addition to the other priorities of BLA in just completing that plan.
Michael: Zaderej, Harold Tamayo, Unknown Executive, Nir Naor, Peter Mariani, Adanna Alexander
Makes sense. Thanks.
Michael: And I know you're still in the process of formulating a strategic plan, but I think one of the things that has
surprised us about the story is
Michael: the lack of standard of care status of the products given the differentiated clinical outcomes that have been, I think, well demonstrated at this point.
Speaker Change: In your initial review of kind of where the company stands today. Do you think you've identified?
Speaker Change: areas that can be improved on in terms of really pushing towards that standard of care status for products like Advance.
Speaker Change: Yes, great question and frankly one of the most important questions.
Speaker Change: because it goes, it's central to what is the opportunity for all stakeholders here.
Speaker Change: and as you described, ADVANCE in particular as well as the entire algorithm deserves to be standard of care, but standard of care with any health care product has a specific number of steps and milestones that must be attained and the opportunity for the business going forward is to work on those.
Speaker Change: The endorsement of that, ensuring that you meet the requirements that allow for classification.
as an expected solution as opposed to just an option.
and then finally coordination with payers.
Speaker Change: And so these are processes that typically take no less than three years and more often closer to five years.
Michael: and when you look at the various applications for our products.
Michael: or the algorithm, because it will be different for breast neurotization than it will be for prostate than it will be for head and neck or OMF.
And that is one of the opportunities that...
Michael: I observed during my original diligence about oxygen and believe can be achieved. There's tremendous goodwill amongst the customers who treat these patients.
Michael: The employees have a tremendous institutional knowledge upon which to build upon and I think we can achieve these things for the simple reason that standard of care for any product is ultimately determined by relative benefit versus risk.
Michael: and the product that AXIGEN has built over the many years.
more than justify that status.
Michael: because from a safety signal standpoint there is literally zero risk that you're asking a patient to accept as part of the use of one of these products.
Michael: And as for the question as to whether or not there is efficacious benefit, the evidence is more than sufficient to justify that as compared to the alternatives.
There really is no better solution.
Michael: then the prescription of advance and are part of the algorithm for these. So that's why I'm here. I mean, I'm very excited about that future. However, those are the mechanics that I referred to. I understand how that game is played and frankly, we're all pretty excited to play that game going forward.
Thank you. Thank you.
Great, thank you.
Speaker Change: Thank you. Our next question comes from the line of Michael Sarkoen with Jefferies. Please proceed with your question.
Michael Sarkoen: Good morning and thanks for taking the questions and Mike, congrats on the new position.
Michael Sarkoen: Zaderej, Harold Tamayo, Unknown Executive, Nir Naor, Peter Mariani, Adanna Alexander
Thank you.
Speaker Change: So just to follow up a little bit on Chris's question, understanding we're going to get some more detail in early 2025, I just wanted to get your take. I agree that the strategy to focus on, you know, the primary accounts and deepening penetration there has been great, but when you look kind of mid to longer term about the sustainability of growth and the business, you know, like how, I guess.
Michael Sarkoen: How far does deepening penetration in those primary accounts get you to sustain growth Versus at some point needing to expand beyond just those primary accounts into maybe a broader customer set
Speaker Change: I'll speak generally, and as I mentioned, when we get together again in the new year, we're going to go into specifics. We totally understand and respect that each of.
Michael Sarkoen: All of our stakeholders need to understand why we're focusing where we focus.
Michael Sarkoen: and that means there needs to be objective criteria to share with you and so we fully intend to do that.
Michael: But if I were to speak generally, when you just look at the world of trauma, whether it be a trans-sector or non-trans-sector situation, there's more than a million of these incidents per year that ideally should be addressed.
Michael: So then you then look at where we actually stand in terms of penetrating or fully exploiting these. Well, those who know us have high respect for what we do. The reality is, is that this therapy, these therapies,
Michael: are very immature in terms of market development. There's much to do. There's many people who still don't know who Axygen or Vance is.
Michael: And there's others who are interested, but it is only part of their current routine, hence a lack of confidence. And when you look at all the potential sites...
Michael: They can participate in nerve repair intervention. It's a very large universe.
Michael: begging the question, what are the business models necessary to prosecute those? And so that's what we're working on. There's no shortage of opportunity, but you need to stand back and say, okay, where are we going to go first and how are we going to do that?
Michael: And that's what we're working on and we believe we have line of sight to How better to do that obviously we have an historical platform built around trauma Even trauma has optimizations in the business model that we think we can we can pursue And and that's what we'll be talking about in the new year, but I'm not at all concerned about the ability to sustain growth
So long as we focus on the basics.
Michael: to deal with a particular area, because again, there's many different applications for our products, different customers, and they will require different business models to support that.
Chris Pusquell: Understood. That's really helpful. Thanks, Mike. And maybe just one for Nir again on...
Nir Naor: Yeah, so I think that as Mike mentioned before, we really wanted to come with a guidance that we feel absolutely confident with.
Michael: I think that we're, as we mentioned, very optimistic towards going into the new year. That said, there could be some interruptions, say, following the hurricanes with respect to supply chain.
Got it. Thank you, Nir.
Speaker Change: Thank you. Our next question comes from the line of Caitlin Cronin with Canaccord Genuity. Please proceed with your question.
Caitlin Cronin: Hi, thanks for taking the questions and congrats on a great quarter. So just to start with the BLA and the standard review, why did the FDA accept your request for priority review? And what's the significance of the FDA not holding an advisory committee meeting?
Speaker Change: You know, I would speculate, nowhere to answer the question, I'd have to speculate. We see nothing untoward in terms of that decision. We're very pleased with the fact that they've identified that the submission is ready for review. That's essentially what they've told us.
Caitlin Cronin: As for whether it was priority or standard, I can't speak to that, to be honest, I don't know. And I could speculate positively and negatively, but that would all be, they don't, when we have these conversations, we don't get into discussions.
Caitlin Cronin: With the regulators about that. It's just that that's what they came back with
Caitlin Cronin: and as for whether or not, as to why they decided not to
Caitlin Cronin: have an advisory committee. Again, I wouldn't want to speculate in their behalf, but I
Caitlin Cronin: I think when you look at the history of the product, when you look at its safety profile and the relevant evidence, what I want to believe is that they see this as efficacious just as our customers and users do, and that while we need to go through this process, there's confidence in terms of the approval.
Speaker Change: Great, thank you so much. And then, I didn't see these in the press release but will you be reporting on core accounts and direct reps going forward?
We will not, not in near term.
Caitlin Cronin: We've mentioned high potential accounts. I think core accounts, I can't really speak to the past.
Caitlin Cronin: But really, almost one year ago now, Doris, the leader of sales, and Jens, our leader of global marketing.
It identifies a very basic application
a focus in the trauma business in particular.
Caitlin Cronin: that asked everyone to focus on where we already have depth.
Caitlin Cronin: and experience and volume that would allow us to build from. One of the really big, one of the most important opportunities for trauma going forward is to make as standard of care within an institution the treatment of nerve.
Caitlin Cronin: There is a lot of nerve opportunity across the country and in fact in every marketplace.
Caitlin Cronin: So you can go to this hospital or go to that hospital and you can do a procedure.
Caitlin Cronin: But institutionally, what the team's trying to do is to focus on specific counts, build upon history, and build upon volume potential in already trained microsurgeons.
Caitlin Cronin: and to make within that institution the expectation that treating the nerve is standard of care for them. And so that's why we're focusing on high potential and it's not really new, they've been working on this for a while, it's just beginning to show some fruits and our initial inspection is that it is and that we're going to continue with that.
Great, thanks so much.
Thank you.
Speaker Change: Thank you. Our next question comes from the line of Mike Kratke with Link Partners. Please proceed with your question.
Speaker Change: Hi, everyone. Thanks for taking our question, and congrats on the great quarter. Mike, great to have you on board. Maybe at a high level. Mike, I'd love to hear how you're thinking about what the potential BLA approval next September could mean from a commercial standpoint for Vans.
Speaker Change: I mean, how much of a game changer do you expect this to be? And based on what you've learned so far, how do you expect this to change the treatment patterns for this product or how it's perceived by patients, physicians or hospitals probably?
Speaker Change: Certainly, I think it's very important. Maybe I and I don't know how everyone's viewing it I can I'll just share with you how I and the team view it and Specifically while we have approval to market today It's a it's a it's by by design a and a
Speaker Change: temporary status That and it was all part of a process that expect us to move and qualify the product under the new guidelines
Speaker Change: And so while that does allow us freedom to operate, there's always the question mark around the actual status of the product for some folks.
Speaker Change: So the bottom line is establishing this and gaining the final approval.
Speaker Change: through the BLA process is important strategically because it affirms that number one, this is a first in its class.
Speaker Change: and then with that allows us to move forward on these market development efforts pursuing standard of care.
Standard of care requires
these formal approvals.
Speaker Change: It requires consensus guidelines amongst the societies, requires a further accumulation of evidence. And so BLA is important strategically insofar as it enables all of those things that I just described.
So hopefully that answers most of your questions.
Speaker Change: Yeah, super helpful. Thanks. And maybe just one follow-up. You know, one thing I don't know I heard as much about on the call is just how you're exploring business development opportunities. You know, as you're scaling up the adjusted EBITDA, is that something that you're going to be ultimately looking at in terms of broadening your portfolio?
Speaker Change: Yeah, well, bottom line, our mission is what's described as standard of care status. And so anything that would be necessary to facilitate that would be within scope. I'm not trying to be coy, just there is no specific target per se. It's what would be required within this space or that space.
to achieve that.
Speaker Change: And based upon what that is, we would consider that within scope. So whether that be internal, external, all things are always on the table. It's about winning at the end of the day on the behalf of the patient. If we do that, shareholders...
Understood. Thanks.
You bet.
Speaker Change: Thank you. Our next question comes from the line of Jason Bedford with Raymond James. Please proceed with your question.
Jason Bedford: Good morning, and congrats on the progress here. Just maybe a couple. Vive Plus, can you talk about the launch, the uptake, and whether it was a notable contributor in 3Q?
Speaker Change: Yeah, VIVE Plus has progressed well, moving through the manufacturing process so we can make it more fully available.
Speaker Change: is what's the focus of the Surgeon. Y Plus fulfills that gap.
Speaker Change: more completely than as opposed to some of our other solutions.
Speaker Change: and to that end it's been received very favorably in terms of actual significance in terms of the results. It's all obviously on a relative basis and we can discuss more of that in Q1, but the product's being received very well, particularly as we're starting to be able to make it fully available from a supply standpoint.
Okay.
Speaker Change: Just maybe on that, I thought the gross margin number was also a highlight, looking to be more efficient here from the APC facility. I think the full year guidance implies this, but is the expectation that we trend higher on gross margin from here? And just out of curiosity, is there any way you can kind of frame the level of advanced product coming from this facility now?
Speaker Change: Yeah, so for the year, as we mentioned, we expect to be at the high end of the annual margin guidance.
Speaker Change: and also as we mentioned in the last quarter that we expected the last quarter's margin to be at or close to the bottom of the trough, this has been the case.
Going forward, as we mentioned in the past, the trend...
Speaker Change: of the gross margin is probably a function of the two trends, one taking it down, the higher proportion of products that we're selling that were manufactured at the APC, the new plant at a higher cost. On the other hand, you have a process and efficiency improvements and a higher capacity utilization which takes the margin up.
Speaker Change: which we believe will be the prevalent trend, absent of any product mixes, going forward into the future.
All right, thank you.
Thank you, Asha.
Thank you for watching. Thank you. Thank you.
Speaker Change: Thank you. Our next question comes from the line of Ross Osborne with Cantor Fitzgerald. Please proceed with your question.
Ross Osborne: Hi guys, congrats on the progress and Mike, welcome aboard and thanks for taking our questions. So following up on a previously asked question, but maybe I'll go at it in a different manner. Curious to hear your thoughts on the company's strategic focus in terms of driving growth versus cash as you seek to become a standard of care.
Speaker Change: I don't know that the two are mutually exclusive, but that's what we'll be able to describe in a more material way in Q1. So the business is making good forward progress, as Nir's described, in that regard. And we're laying out what those timelines would be in the various business models so that we can understand that more completely. But simply said, I don't know that they're mutually exclusive.
Speaker Change: Okay, fair enough. And then I guess lastly for us, could you provide some more color on your initiatives in breast neutralization, such as the National Rejuvenation Breast Program?
to conduct breast reconstruction is extremely high.
Speaker Change: It's considered the right thing to do, and it's considered a necessary skill set to be able to do this.
Speaker Change: We have very strong demand. And I've had, early upon my arrival, I had a chance to attend one of these.
Speaker Change: and I believe that I can look back on my career and say that I know what good looks like.
Speaker Change: from an educational standpoint. And honestly, AXIGEN's, the quality of their program, the discussions, the actual practical hands-on is some of the best work that I've ever had the experience to be.
Speaker Change: a part of. And so they do a really good job. And you talk about products, talk about technology and what's proprietary and unique. I would say Axigen's ability to conduct education in these novel areas is one of their distinctive assets.
Speaker Change: So, hopefully that answers your question, but there's no shortage of interest in breast neurotization. The feedback, I've had a chance to talk to patients, I've talked to physicians who are doing these procedures, they believe in this and there is a very strong future for breast neurotization.
All right. Thank you.
Speaker Change: Thank you. Our next question comes from the line of Dave Terkeley with Citizens JNP. Please proceed with your question.
Great, and congrats, Mike.
Dave Terkeley: Yeah, given your background and some of the experience you've had, you know, this is sort of a newer arena for a lot of folks, but
Dave Terkeley: I'd just sort of like to ask, you know, and appreciate the comments you made up front, but what's been the biggest surprise since you joined?
Great question.
Speaker Change: As you can tell, I'm trying to figure out what, how would I, how would I answer that? I'll let you think about that for a minute and I'll answer your second one if you want. No, no, no, no, I think the surprise is, I don't know if surprise is the right word, just the recognition that chronological age aside, market development is still early.
Great, and then in your commentary, I heard you say,
Prostate in the...
Speaker Change: I've followed the company for a long time. I've not really heard that talked about a lot, and I know you probably expand in
Speaker Change: On the fourth call, but just high level. Could you explain exactly what that kind of opportunity might look like?
Speaker Change: Thank you. We're not necessarily specific to prostate, but maybe just kind of lay it out. I mean, trauma, by definition of the word, implies that you have an emergent situation which is significant, and that nerve has been transected or contused.
Speaker Change: in such a way that, but it's also part of a lot of other things going on at the same time. So these are not the easiest procedures upon which to intervene, yet that's of course where we were founded because that's where the greatest need was.
Speaker Change: But when you look at any other situation where nerve is impacted, that's elective, you have a more controlled situation.
Speaker Change: You have the ability to plan for it. You're not dealing most often with collateral damage that also may affect the actual outcome.
Speaker Change: So, in that sense, ADVANCE has the potential to work more simply and with even higher efficacy.
Speaker Change: and almost anything that's outside of trauma simply because you don't have those other attendant elements to deal with. So again, I'm generalizing, but that's one of the things that I think holds a great opportunity is when we start to expand the offering into these other areas because the product is going to work, has a chance to work even better, not less.
and those types of situations.
Thank you.
Speaker Change: Sorry, thank you. Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Dale for any final comments.
Thank you, operator.
Dale: On behalf of the Action Team, I want to thank everyone for their time and interest in our work to fulfill the promise and potential for all stakeholders in our business purpose to restore health and improve quality of life by making restoration of peripheral nerve function an expected standard of care. We look forward to updating you on our continued progress and our plans for the future next quarter. Thank you.
Speaker Change: Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.