Q4 2024 Anika Therapeutics Inc Earnings Call

March 12, 2025

Session.

Speaker Change: During this call you require immediate assistance. Please press star zero for the operator also note that this call is being recorded on Wednesday March 12, 2025, I will now turn the call over to Matt Hall Director of corporate development and Investor Relations. Please go ahead Sir.

Matt Hall: Thank you Sylvia.

Matt Hall: Good evening and thank you for joining us for <unk> fourth quarter and year end 2024 conference call and webcast I'm, Matt Hall, Atticus director of corporate development and Investor Relations. Our earnings press release was issued earlier. This afternoon and is available on our Investor Relations website located at Www Dot Anika dot com as are the supper.

Matt Hall: Mentoring Powerpoint slides there'll be used for the discussion today.

Speaker Change: With me on the call today are Dr. Cheryl Blanchard, President and Chief Executive Officer, and Steve Griffin Executive Vice President Chief Financial Officer, and Treasurer, who will present, our fourth quarter and year end 2024 financial results and business highlights.

Matt Hall: I'm Matt Hall, Anika's Director of Corporate Development and Investor Relations. Our earnings press release was issued earlier this afternoon and is available on our Investor Relations website located at www.anika.com, as are the supplementary PowerPoint slides that will be used for the discussion today.

Earnings Press release was issued earlier this afternoon and is available on our Investor Relations website located at Www Dot Anika dot com as are the supplementary Powerpoint slides there'll be used for the discussion today.

Speaker Change: Please take a moment and open the slide presentation and refer to slide number two.

Speaker Change: Yeah.

Speaker Change: Before we begin please understand that certain statements made during the call today constitute forward looking statements as defined in the Securities Exchange Act of 1934.

Matt Hall: With me on the call today are Dr. Cheryl Blanchard, President and Chief Executive Officer, and Steve Griffin, Executive Vice President, Chief Financial Officer, and Treasurer, who will present our fourth quarter and year-end 2024 financial results and business highlights.

Speaker Change: These statements are based on our current beliefs and expectations and are subject to certain risks and uncertainties.

Speaker Change: The company's actual results could differ materially from any anticipated future results performance or achievements, we make no obligation to update these statements should future financial data or events occur that differ from the forward looking statements presented today.

Speaker Change: Please take a moment and open the slide presentation and refer to slide number two.

Matt Hall: Please take a moment and open the slide presentation and refer to slide number two.

Speaker Change: Yeah.

Matt Hall: Before we begin, please understand that certain statements made during the call today constitute forward-looking statements as defined in the Securities Exchange Act of 1934. These statements are based on our current beliefs and expectations and are subject to certain risks and uncertainties. The company's actual results could differ materially from any anticipated future results, performance, or achievement. We make no obligation to update these statements should future financial data or events occur that differ from the forward-looking statements presented today.

Before we begin please understand that certain statements made during the call today constitute forward looking statements as defined in the Securities Exchange Act of 1930 for these.

Speaker Change: Please also see our most recent SEC filings for more information about risk factors that could affect our performance.

These statements are based on our current beliefs and expectations and are subject to certain risks and uncertainties.

Speaker Change: In addition, during the call we may refer to several adjusted or non-GAAP financial measures, which may include adjusted gross margin adjusted EBITDA adjusted net income from continuing operations and adjusted earnings per share from continuing operations, which are used in addition to results presented in accordance with GAAP financial measures.

Speaker Change: We believe that non-GAAP measures provide an additional way of viewing aspects of our operations and performance, but when considered with GAAP financial measures and the reconciliation of GAAP measures. They provide an even more complete understanding of our business.

Matt Hall: Please also see our most recent SEC filings for more information about risk factors that could affect our performance.

Speaker Change: Please also see our most recent SEC filings for more information about risk factors that could affect our performance.

Matt Hall: In addition, during the call, we may refer to several adjusted or non-GAAP financial measures, which may include adjusted gross margin, adjusted EBITDA, adjusted net income from continuing operations, and adjusted earnings per share from continuing operations, which are used in addition to results presented in accordance with GAAP financial measures. We believe that non-GAAP measures provide an additional way of viewing aspects of our operations and performance. But when considered with GAAP financial measures and the reconciliation of GAAP measures, they provide an even more complete understanding of our business.

Speaker Change: In addition, during the call we may refer to several adjusted or non-GAAP financial measures, which may include adjusted gross margin adjusted EBITDA.

Speaker Change: A reconciliation of these adjusted non-GAAP financial results to the most comparable GAAP measurements are available at the end of the presentation slide deck, and our fourth quarter and full year 2024 press release.

Speaker Change: Adjusted net income from continuing operations and adjusted earnings per share from continuing operations, which are used in addition to results presented in accordance with GAAP financial measures.

Speaker Change: And now I'd like to turn the call over to our President and CEO, Dr. Cheryl Blanchard Cheryl.

Speaker Change: Thanks, Matt Good afternoon, everyone and thank you for joining US please turn to slide three.

Speaker Change: I'm pleased to report since our last call, we've made meaningful progress advancing our strategic initiatives and refocusing our strategy.

Matt Hall: A reconciliation of these adjusted non-GAAP financial results to the most comparable GAAP measurements are available at the end of the presentation slide deck and our fourth quarter and full year 2024 press release.

We've communicated a key objective has been to focus our human and financial capital on our most promising opportunities to create shareholder value.

Cheryl Blanchard: And now I'd like to turn the call over to our President and CEO, Dr. Cheryl Blanchard. Thanks, Matt. Good afternoon, everyone, and thank you for joining us.

And now I'd like to turn the call over to our President and CEO, Dr. Cheryl Blanchard Cheryl.

Speaker Change: As a result, we divested Arthur surface in Q4 of 2024 and last week announced that we have completed the sale of <unk> medical.

Matt: Thanks, Matt Good afternoon, everyone and thank you for joining US please turn to slide three.

Cheryl Blanchard: Please turn to slide three. I'm pleased to report since our last call that we've made meaningful progress advancing our strategic initiative and refocusing our strategy. As we've communicated, a key objective has been to focus our human and financial capital on our most promising opportunities to create shareholder value. As a result, we divested Arthrosurface in Q4 of 2024 and last week announced that we have completed the sale of Parkis Medical. These divestitures align with our focus to capitalize on our core HA products that provide us with the best value building opportunities, including the Integrity Implant System and the U.S.

Matt: I'm pleased to report since our last call, we've made meaningful progress advancing our strategic initiatives and refocusing our strategy.

Speaker Change: These divestitures align with our focus to capitalize on our core H a products that provide us with the best value building opportunities.

Matt: We've communicated a key objective has been to focus our human and financial capital.

Speaker Change: Leading integrity implant system and the U S approval of highway fast and Cingal.

Matt: It's promising opportunities to create shareholder value.

Speaker Change: I'll start today by sharing our financial results for the quarter and full year.

Matt: As a result, we divested Arthur surface in Q4 of 2024 and last week announced that we have completed the sale of park is medical.

Speaker Change: Overall revenue in the fourth quarter was $30 6 million up 1% compared to the same period in 2023.

These divestitures align with our focus to capitalize on our core H a products that provide us with the best value building opportunities.

Speaker Change: For the year revenue was $119 9 million, a slight decrease of 1% compared to 2023.

Matt: Cleaning integrity implant system and the U S approval of highway fast and Cingal.

Speaker Change: Commercial channel revenue was up 25% in the quarter and 17% for the full year.

Cheryl Blanchard: approvals of HyloFast and Syngal.

Cheryl Blanchard: I'll start today by sharing our financial results for the quarter and full year. Overall revenue in the fourth quarter was $30.6 million, up 1% compared to the same period in 2023. For the year, revenue was $119.9 million, a slight decrease of 1% compared to 2023. Commercial channel revenue was up 25% in the quarter and 17% for the full year, while OEM channel revenue decreased by 8% for the quarter and the full year, consistent with our expectations. During the fourth quarter, we delivered 22% international OA pain management growth and 16% growth for the full year. This success was driven by continued geographic expansion and market share gains, highlighting our robust international presence.

Matt: I'll start today by sharing our financial results for the quarter and full year.

Speaker Change: Well OEM channel revenue decreased by 8% for the quarter and the full year consistent with our expectations.

Matt: Overall revenue in the fourth quarter was $30 6 million up 1% compared to the same period in 2023.

Speaker Change: During the fourth quarter, we delivered 22% international OA pain management growth and 16% growth for the full year.

For the year revenue was $119 9 million, a slight decrease of 1% compared to 2023.

Speaker Change: This success was driven by continued geographic expansion and market share gains highlighting our robust international presence.

Matt: Commercial channel revenue was up 25% in the quarter and 17% for the full year well.

Speaker Change: Our efforts to penetrate new markets and strengthen our distribution networks have paid off and we are committed to further expanding our global footprint.

Well OEM channel revenue decreased by 8% for the quarter and the full year consistent with our expectations.

Speaker Change: In 2024, we made significant progress across our refocused company.

Matt: During the fourth quarter, we delivered 22% international OA pain management growth and 16% growth for the full year.

We executed on key objectives that drove strong growth in our commercial channel fueled by continued gains in our international OA pain management business and further acceleration of integrity.

This success was driven by continued geographic expansion and market share gains.

Matt: Lighting, a robust international presence R.

Cheryl Blanchard: Our efforts to penetrate new markets and strengthen our distribution networks have paid off, and we are committed to further expanding our global footprint.

Our efforts to penetrate new markets and strengthen our distribution networks have paid off and we are committed to further expanding our global footprint.

Speaker Change: We sharpened our strategic focus on H E based products and achieved important milestones in our commercial regulatory and clinical trial goals.

Cheryl Blanchard: In 2024, we made significant progress across the refocused company. We executed on key objectives that drove strong growth in our commercial channel, fueled by continued gains in our international OA pain management business and further acceleration of integrity. We sharpened our strategic focus on HA-based products and achieved important milestones in our commercial, regulatory, and clinical trial goals. During the quarter, Integrity realized more than 40% sequential growth with more than 300 surgeries performed in the quarter, and now over 1,000 globally since its launch. This marks the third sequential quarter that we've achieved greater than 40% quarter-over-quarter growth.

Matt: In 2024, we made significant progress across the refocused company.

During the quarter integrity realized more than 40% sequential growth with more than 300 surgeries performed in the quarter and now over 1000 globally since its launch.

Matt: We executed on key objectives that drove strong growth in our commercial channel feels like continued gains in our international OA pain management business and further acceleration of integrity.

Speaker Change: This marks the third sequential quarter that we've achieved greater than 40% quarter over quarter growth.

Matt: We sharpened our strategic focus on H E based products and achieved important milestones in our commercial regulatory and clinical trial goals.

Speaker Change: This impressive growth is attributed to the superior regenerative properties and mechanical strength of integrity compared to college and scaffolds.

Matt: During the quarter integrity realized more than 40% sequential growth with more than 300 surgeries performed in the quarter and now over 1000 globally since its launch.

Speaker Change: These key attributes of integrity have resulted in a strong pull from surgeons.

Speaker Change: In February we released a white paper summarizing the early clinical results from our first post market study of 29 patients with partial and full thickness rotator cuff tears.

Matt: This marks the third sequential quarter that we've achieved greater than 40% quarter over quarter growth.

Speaker Change: The results showed significant and clinically meaningful improvements in pain and strength at three months and further improvements in pain range of motion and strength at six months with no evidence of any retires at six months or device related complications.

Cheryl Blanchard: This impressive growth is attributed to the superior regenerative properties and mechanical strength of integrity compared to collagen scaffolds. These key attributes of integrity have resulted in a strong pull from surgeons. In February, we released a white paper summarizing the early clinical results from our first post-market study of 29 patients with partial and full thickness rotator cuff tears. The results showed significant and clinically meaningful improvements in pain and strength at three months and further improvements in pain, range of motion, and strength at six months, with no evidence of any reach errors at six months or device-related complications.

Matt: This impressive growth is attributed to the superior regenerative properties and mechanical strength of integrity compared to collagen scaffold.

Matt: These key attributes of integrity have resulted in a strong pull from surgeons.

Matt: In February we released a white paper summarizing the early clinical results from our first post market study of 29 patients with partial and full thickness rotator cuff tears.

Speaker Change: This data has been well received leading to increased adoption and we continue to hear positive feedback from both surgeons and their patients.

Speaker Change: As a result of our successful commercial launch we captured more than 1% of the 'twenty 'twenty four U S soft tissue augmentation procedures in our first six months of full market release.

Matt: The results showed significant and clinically meaningful improvements in pain and strength at three months and further improvements in pain and range of motion and strength that six months with no evidence of any re chairs at six months or device related complications.

We believe integrity will continue to drive significant commercial channel revenue contributing to our long term revenue targets and market expansion plans.

Cheryl Blanchard: This data has been well received, leading to increased adoption and we continue to hear positive feedback from both surgeons and their patients. As a result of our successful commercial launch, we captured more than 1% of the 2024 U.S. soft tissue augmentation procedures in our first six months of full market release. We believe integrity will continue to drive significant commercial channel revenue, contributing to our long-term revenue targets and market expansion plans. To further accelerate growth in our commercial channel, we continue to advance our Integrity Technology Platform to add additional near-term regenerative solutions products to our pipeline.

This data has been well received leading to increased adoption and we continue to hear positive feedback from both surgeons and their patients.

Speaker Change: To further accelerate growth in our commercial channel, we continue to advance our integrity technology platform to add additional near term regenerative solutions products to our pipeline.

Matt: As a result of our successful commercial launch we captured more than 1% of the 'twenty 'twenty four.

Speaker Change: As mentioned on our Q3 call we've partnered with a team of leading surgeons to develop new shapes sizes and configurations of integrity work.

Our soft tissue augmentation procedures in our first six months of full market release.

Matt: We believe integrity will continue to drive significant commercial channel revenue contributing to our long term revenue targets and market expansion plans.

Speaker Change: We are on track to begin introduction of those new product line extensions to the U S market later this year.

Additionally, we've enrolled our first patient in the prospective clinical study for integrity.

Matt: To further accelerate growth in our commercial channel, we continue to advance our integrity technology platform to add additional near term regenerative solutions products to our pipeline.

Speaker Change: This study will provide valuable real world evidence that will enhance integrity position in the market support expanding sales efforts and marketing efforts and drive further commercial growth.

Cheryl Blanchard: As mentioned on our Q3 call, we've partnered with a team of leading surgeons to develop new shapes, sizes, and configurations of Integrity. We are on track to begin introduction of those new product line extensions to the U.S. market later this year. Additionally, we've enrolled our first patient in the prospective clinical study for integrity. This study will provide valuable, real-world evidence that will enhance integrity's position in the market, support expanding sales efforts and marketing efforts, and drive further commercial growth. We anticipate that the data from this study will reinforce the clinical benefits and safety profile of Integrity, further solidifying its market position.

Matt: As mentioned on our Q3 call we've partnered with a team of leading surgeons to develop new shapes sizes and configurations of integrity.

Speaker Change: We anticipate that the data from this study will reinforce the clinical benefits and safety profile of integrity further solidifying its market position.

Matt: We are on track to begin an introduction of those new product line extensions to the U S market later this year.

Matt: Additionally, we've enrolled our first patient in the prospective clinical study for integrity.

Speaker Change: Data from this study will also be used for submission to the EU for <unk> approval.

Speaker Change: We also made significant regulatory and clinical progress with our key pipeline programs.

Matt: This study will provide valuable real world evidence that will enhance integrity is positioned in the market support expanding sales efforts and marketing efforts and drive further commercial growth.

Speaker Change: In January 2025, we filed the second PMA module for <unk> fast are single stage off the shelf proprietary how erotic asset scaffolds for cartilage repair, which is already sold in over 35 countries outside the U S.

Matt: We anticipate data from this study will reinforce the clinical benefits and safety profile of integrity further solidifying its market position.

Speaker Change: We expect to file the third and final clinical module in the second half of this year with a U S launch planned by 2026.

Cheryl Blanchard: Data from this study will also be used for submission to the EU for MDR approval.

Matt: Data from this study will also be used for submission to the EU for N P or approval.

Matt: We also made significant regulatory and clinical progress with our key pipeline programs.

Cheryl Blanchard: We also made significant regulatory and clinical progress with our key pipeline programs. In January 2025, we filed the second PMA module for Hyalafast, our single-stage, off-the-shelf, proprietary hyaluronic acid scaffold for cartilage repair, which is already sold in over 35 countries outside the U.S. We expect to file the third and final clinical module in the second half of this year with a U.S. launch planned by 2026.

Speaker Change: We also reached another key regulatory milestone for <unk> fast receiving MTR approval in February.

Matt: In January 2025, we filed the second PMA module for high all of fast our single stage off the shelf proprietary highly erotic acid scaffolds for cartilage repair, which is already sold in over 35 countries outside the U S.

Speaker Change: Pilot fast has shown continued market leading positions in geographies, where it's sold and we're excited about its potential to address significant unmet needs for cartilage repair patients in the U S.

Matt: We expect to file the third and final clinical module in the second half of this year with a U S launch planned by 2026.

Speaker Change: Finally, cingal, our fast acting long lasting non opioid pain products also saw important advancements.

Cheryl Blanchard: We also reached another key regulatory milestone for Hylifast, receiving MDR approval in February. Hylifast has shown continued market-leading positions in geographies where it sold, and we're excited about its potential to address significant unmet needs for cartilage repair patients in the U.S.

Matt: We also reached another key regulatory milestone for Halo fast receiving M D. Our approval in February.

Speaker Change: We held a productive type C meeting with the FDA in February to help finalize the bioequivalence bridging study design.

Pilot fast has shown continued market leading positions in geographies, where it's sold and we're excited about its potential to address significant unmet needs for cartilage repair patients in the U S.

We're awaiting formal feedback from the meeting and plan to share further updates to investors as we move forward.

Speaker Change: We also started the final non clinical toxicology testing in Q1 of this year.

Matt: Finally, cingal, our fast acting long lasting non opioid pain products also saw important advancements.

Cheryl Blanchard: Finally, Syngal, our fast-acting, long-lasting, non-opioid OA pain product, also saw important advancements. We held a productive type C meeting with the FDA in February to help finalize the bioequivalence bridging study design. We are awaiting formal feedback from the meeting and plan to share further updates to investors as we move forward. We also started the final non-clinical toxicology testing in Q1 of this year. The feedback from international markets has been overwhelmingly positive and we believe Sengal will be a market driving force in the next generation OA pain management segment.

Speaker Change: Feedback from international markets has been overwhelmingly positive and we believe cingal will be a market driving force in the next generation OA pain management segment.

Matt: We held a productive type C meeting with the FDA in February to have finalized the bioequivalence bridging study design.

Steve Griffin: And with that I'll now turn the call over to Steve for a detailed review of our financial results.

Matt: We're awaiting formal feedback from the meeting and plan to share further updates to investors as we move forward.

Steve Griffin: Thank you Cheryl.

Before I review the quarter I'll start by providing some further details regarding our recently announced sale of the <unk> business.

Matt: We also started the fight on non clinical toxicology testing in Q1 of this year.

In line with our announcement in October of last year, we completed the simultaneous signing and closing of the Parker Sports Medicine business on Friday March 7th to my Doctor.

Feedback from international markets has been overwhelmingly positive and we believe cingal will be a market driving force in the next generation OA pain management segment.

Matt: And with that I'll now turn the call over to Steve for a detailed review of our financial results.

Cheryl Blanchard: And with that, I'll now turn the call over to Steve for a detailed review of our financial results. Thank you, Cheryl.

Steve Griffin: Well respected and growing global orthopedic company.

Steve Griffin: This deal positions the <unk> business to continue to serve patients, while enabling anika to prioritize our investments on our highest growth higher margin hyaluronic acid technologies.

Steve Griffin: Thank you Cheryl.

Steve Griffin: Before I review the quarter, I'll start by providing some further details regarding the recently announced sale of the Parkinson's vaccine. In line with our announcement in October of last year, we completed the simultaneous signing and closing of the Parka Sports Medicine business on Friday, March 7th, to Medacta, a well-respected and growing global orthopedic company. This deal positions the Parkis business to continue to serve patients while enabling Anika to prioritize our investments on our highest growth, higher margin hyaluronic acid technology. The transaction closed with cash received at closing subject to customary post-closing networking capital condition. We expect to support the Parkas and Medacta teams through a transition services agreement in 2025 to ensure continuity of business services.

Steve Griffin: Before I review the quarter I'll start by providing some further details regarding our recently announced sale of the parking business.

In line with our announcement in October of last year, we completed the simultaneous signing and closing of the Parker Sports Medicine business on Friday March 7th Tim a doctor, a well respected and growing global orthopedic company.

Steve Griffin: The transaction closed with cash received at closing subject to customary post closing net working capital conditions.

Steve Griffin: We expect to support the purpose and the Doctor teams through a transition services agreement in 2025 to ensure continuity of business services.

Steve Griffin: This deal positions the parking business to continue to serve patients, while enabling anika to prioritize our investments on our highest growth higher margin hyaluronic acid technologies.

Steve Griffin: We have now successfully closed on the sales of Arthur surface and park as well.

Steve Griffin: Both businesses will be included in the discontinued operations income statements and the associated assets and liabilities have been re classed to held for sale and the respective balance sheet periods.

Steve Griffin: The transaction closed with cash received at closing subject to customary post closing net working capital conditions.

Steve Griffin: We expect to support the parkas and medaka teams through a transition services agreement in 2025 to ensure continuity of business services.

Steve Griffin: This strategic move including an all cash transaction at closing for the second sale allows us to streamline our operations and focus on our core strengths, while providing these businesses with new opportunities under the new leadership.

Steve Griffin: We have now successfully closed on the sales of Arthur surface and park guests.

Steve Griffin: We have now successfully closed on the sales of Arthur Surface and Parkas. Both businesses will be included in the discontinued operations income statement and the associated assets and liabilities have been reclassed to help for sale in the respective balance sheet period. This strategic move, including an all-cash transaction at closing for the second sale, allows us to streamline our operations and focus on our core strengths, while providing these businesses with new opportunities under their new leadership.

Steve Griffin: Going forward, our continuing operations will reflect the core products of anecdotes hyaluronic acid future and key reconciliations to quarter results are provided in the appendix materials of today's presentation.

Steve Griffin: I will now provide updates on the fourth quarter of 2024.

Steve Griffin: Please refer to slide four of the presentation.

Steve Griffin: In the fourth quarter Anika generated $30 6 million in total revenue.

Steve Griffin: Going forward, our continuing operations will reflect the core products of animals hyaluronic acid future and key reconciliations to quarter results are provided in the appendix materials of today's presentation.

Steve Griffin: Going forward, our continuing operations will reflect the core products of Anika's hyaluronic acid future, and key reconciliations to quarter results are provided in the appendix materials of today's presentation.

Up 1% versus the same period in 2023.

Steve Griffin: Revenue in the commercial channel, which includes our highly differentiated products sold globally through commercial leaders direct sales representatives and independent distributors was up 25% year over year to $10 $9 million slightly ahead of our previously provided guidance.

Steve Griffin: I will now provide updates on the fourth quarter of 2024.

Steve Griffin: I'll now provide updates on the fourth quarter of 2024.

Steve Griffin: Please refer to slide four of the presentation. In the fourth quarter, Anika generated $30.6 million in total revenue, up 1% versus the same period in 2023. Revenue in the commercial channel, which includes our highly differentiated products sold globally through commercial leaders, direct sales representatives, and independent distributors, was up 25 percent year-over-year to $10.9 million, slightly ahead of our previously provided guidance. We continue to execute well on our international OA paying growth strategy with sales up 22% year-over-year, led by MonoVisk and Singal. Also in our commercial channel, regenerative solutions grew 32% year over year, and continues to form a solid foundation for future growth as we exceed our initial launch expectations for integrity.

Steve Griffin: Please refer to slide four of the presentation.

Steve Griffin: In the fourth quarter Anika generated $30 6 million in total revenue.

Steve Griffin: We continue to execute well on our international away paying growth strategy with sales up 22% year over year led by Monovisc and Cingal.

Steve Griffin: Up 1% versus the same period in 2023.

Steve Griffin: Also in our commercial channel regenerative solutions grew 32% year over year and continues to form a solid foundation for future growth as we exceed our initial launch expectations for integrity.

Steve Griffin: Integrity sales grew by more than 40% sequentially for the third straight quarter and since commercial launch we have completed more than 1000 cases.

Steve Griffin: We continue to execute well on our international OA pain growth strategy with sales up 22% year over year led by Monovisc and Cingal.

Steve Griffin: Integrity captured more than 1% of the domestic rotator cuff augmentation market in 2024 and is poised to continue to grow as a result of our differentiated technology.

Steve Griffin: Revenue in the OEM channel, which includes our domestic OA pain and non orthopedic products sold under long term agreements decreased 8% in the fourth quarter to $19 $7 million in line with guidance.

Steve Griffin: Integrity sales grew by more than 40% sequentially for the third straight quarter and since commercial launch we have completed more than 1000 cases.

Steve Griffin: Integrity sales grew by more than 40% sequentially for the third straight quarter. And since commercial launch, we have completed more than 1000 cases. Integrity captured more than 1% of the domestic rotator cuff augmentation market in 2024, and is poised to continue to grow as a result of our differentiated technology.

Steve Griffin: Integrity captured more than 1% of the domestic rotator cuff augmentation market in 2024 and is poised to continue to grow as a result of our differentiated technology.

Steve Griffin: The decline was primarily due to lower U S sales from J&J, which face lower volumes and competitive pricing pressures.

Steve Griffin: Despite reduced market access and lower pricing Monovisc and ortho bisque remain market leaders in the U S.

Steve Griffin: Revenue in the OEM channel, which includes our domestic OA pain and non-orthopedic products sold under long-term agreements, decreased 8% in the fourth quarter to $19.7 million in line with guidance. The decline was primarily due to lower U.S. sales from J&J, which faced lower volumes and competitive pricing pressure. Despite reduced market access and lower pricing, MonoVisk and OrthoVisk remain market leaders in the U.S. In this market, multi-injection continues to siege market share to single-injection, while both products' pricing are more reflective of the competitive environment.

Steve Griffin: And this market multi injection continues to cede market share to single injection well both products pricing are more reflective of the competitive environment.

Steve Griffin: The decline was primarily due to lower U S sales from J&J, which face lower volumes and competitive pricing pressures.

Steve Griffin: Non orthopedic revenue declined in the quarter driven by lower sales of mature products.

Steve Griffin: Fourth quarter gross margin was 56% down 13 points from last year.

Despite reduced market access and lower pricing.

Steve Griffin: Davis and or divest remain market leaders in the U S.

Steve Griffin: Adjusted gross margin, excluding legacy product rationalization charges was 58% down 11 points versus last year.

Steve Griffin: In this market multi injection continues to cede market share to single injection, while both products pricing are more reflective of the competitive environment.

Steve Griffin: One time legacy program expenses and the product mix sold during the quarter equally contributed to the decrease.

Steve Griffin: Non orthopedic revenue declined in the quarter driven by lower sales of mature products.

Steve Griffin: Non-orthopedic revenue declined in the quarter driven by lower sales of mature products. Fourth quarter gross margin was 56%, down 13 points from last year. Adjusted gross margin, excluding legacy product rationalization charges, was 58%, down 11 points versus last year. One-time legacy program expenses and the product mix sold during the quarter equally contributed to the decrease.

Steve Griffin: Operating expenses in the fourth quarter totaled $17 $8 million down $1 million or 7% as compared to 2023.

Fourth quarter gross margin was 56% down 13 points from last year.

Steve Griffin: Adjusted gross margin, excluding legacy product rationalization charges was 58% down 11 points versus last year.

Steve Griffin: Selling general and administrative expenses were lower by 16% as compared to 2023, driven by cost actions taken earlier in the year and head count reductions.

Steve Griffin: One time legacy program expenses and the product mix sold during the quarter equally contributed to the decrease.

Steve Griffin: Research and development expenses of $6 $5 million were higher by 18% compared to 2023, primarily as a result of the one time FDA filing fee for IL a fast in October.

Steve Griffin: Operating expenses in the fourth quarter totaled $17 $8 million down $1 million or 7% as compared to 2023.

Steve Griffin: Operating expenses in the fourth quarter totaled $17.8 million, down $1 million, or 7% as compared to 2023. Selling, general, and administrative expenses were lower by 16% as compared to 2023, driven by cost actions taken earlier in the year and headcount reductions. Research and development expenses of $6.5 million were higher by 18% compared to 2023, primarily as a result of the one-time FDA filing fee for Hyalafast in October. Continuing operations generated $3.6 million of adjusted EBITDA, down 44% as compared to 2023, primarily as a result of the one-time legacy program expenses, product mix, and higher research and development.

Steve Griffin: Continuing operations generated $3 6 million of adjusted EBITDA.

Steve Griffin: Selling general and administrative expenses were lower by 16% as compared to 2023, driven by cost actions taken earlier in the year and head count reductions.

Speaker Change: Down 44% as compared to 2023, primarily as a result of the one time legacy program expenses product mix and higher research and development.

Steve Griffin: Research and development expenses of $6 $5 million were higher by 18% compared to 2023, primarily as a result of the one time FDA filing fee for <unk> in October.

Speaker Change: Discontinued operations in the fourth quarter included a onetime noncash impairment charge associated with the sale of <unk> medical.

For the quarter discontinued operations generated $100000 in adjusted EBITDA.

Steve Griffin: Continuing operations generated $3 6 million of adjusted EBITDA down, 44% as compared to 2023, primarily as a result of the one time legacy program expenses product mix and higher research and development.

Speaker Change: As a note in accordance with GAAP certain corporate expenses for accounting human resources.

Speaker Change: In legal remaining continuing operations and have not been allocated to the discontinued operations P&L for any of our recast financials.

Steve Griffin: Discontinued operations in the fourth quarter included a onetime noncash impairment charge associated with the sale of <unk> medical.

Steve Griffin: Discontinued operations in the fourth quarter included a one-time non-cash impairment charge associated with the sale of Parkis Medical. For the quarter, discontinued operations generated $100,000 and adjusted EBITDA. As a note, in accordance with GAAP, certain corporate expenses for accounting, human resources, IT, and legal remain in continuing operations and have not been allocated to the discontinued operations P&L for any of our recasted financial Total adjusted EBITDA for Anika was $3.6 million, in line with our previous guidance.

Total adjusted EBITDA for Anika was $3 6 million in line with our previous guidance.

Steve Griffin: For the quarter discontinued operations generated $100000 in adjusted EBITDA.

Speaker Change: In the first quarter of 2025, we will continue to include the results from park is medical and discontinued operations. In addition to any transition services related to support for the buyer.

As a note in accordance with GAAP.

Steve Griffin: Corporate expenses for accounting human resources.

Steve Griffin: And legal remaining continuing operations and have not been allocated to the discontinued operations P&L for any of our recast financials.

Speaker Change: We expect that by year end 2025, there will be no further discontinued operations activities.

Speaker Change: Okay.

Now turning to cash and liquidity.

Steve Griffin: Total adjusted EBITDA for Anika was $3 6 million in line with our previous guidance.

Speaker Change: We generated $1 6 million in operating cash flow this quarter down from $3 $6 million last year, primarily due to lower profitability.

Steve Griffin: In the first quarter of 2025, we will continue to include the results from park is medical and discontinued operations. In addition to any transition services related to support for the buyer.

Steve Griffin: In the first quarter of 2025, we will continue to include the results from Parkis Medical and discontinued operations, in addition to any transition services related to support for the buyer. We expect that by year-end 2025, there will be no further discontinued operations activity.

Speaker Change: In the second half of 2024, we generated $6 6 million in operating cash flow as a result of stronger working capital management.

We expected by year end 2025, there will be no further discontinued operations activities.

Speaker Change: Capital expenditures in the quarter were $1 3 million down $500000 from the prior year.

Now turning to cash and liquidity.

Steve Griffin: Now turning to cash illiquidity. We generated $1.6 million in operating cash flow this quarter, down from $3.6 million last year, primarily due to lower profitability. In the second half of 2024, we generated $6.6 million in operating cash flow as a result of stronger working capital management. Capital expenditures in the quarter were $1.3 million, down $500,000 from the prior year. We're investing in our Massachusetts manufacturing facility to support higher expected output of OA pain and regenerative solutions products offset by lower expenditures for Arthrosurface and Parkis in the prior year.

Steve Griffin: We generated $1 6 million in operating cash flow this quarter down from $3 6 million last year, primarily due to lower profitability.

Speaker Change: We are investing in our Massachusetts manufacturing facility to support higher expected output of OA pain and regenerative solutions products.

Steve Griffin: In the second half of 2024, we generated $6 6 million in operating cash flow.

Speaker Change: Offset by lower expenditures for Arthur surface in pockets in the prior year.

Speaker Change: As previously communicated we initiated a <unk> one stock repurchase plan in May 2024.

Steve Griffin: As a result of a stronger working capital management.

Capital expenditures in the quarter were $1 3 million down $500000 from the prior year.

Speaker Change: In the fourth quarter, we purchased $5 $6 million in common stock.

Steve Griffin: We are investing in our Massachusetts manufacturing facility to support higher expected output of OA pain, and regenerative solutions products offset by lower expenditures for Arthur surface in pockets in the prior year.

Speaker Change: As of last week, we completed the $15 million initial share repurchase.

Speaker Change: Earlier than our expected June 2025 deadline.

Speaker Change: We remain committed to completing our total share repurchase plan by 2026, and we will share more information when were in a position to do so.

Steve Griffin: As previously communicated we initiated a <unk> one stock repurchase plan in May 2024.

Steve Griffin: As previously communicated, we initiated a 10B51 stock repurchase plan in May 2024. In the fourth quarter, we purchased $5.6 million in common stock. As of last week, we completed the $15 million initial share repurchase earlier than our expected June 2025 deadline. We remain committed to completing our total share repurchase plan by 2026 and will share more information when we're in a position to do so.

Speaker Change: We ended the fourth quarter with $56 million in cash and no debt.

Steve Griffin: In the fourth quarter, we purchased $5 $6 million in common stock.

Speaker Change: Now to slide five.

Speaker Change: For the full year Anika generated revenue of 109, $119 9 million a.

Steve Griffin: As of last week, we completed the $15 million initial share repurchase earlier than our expected June 2025 deadline.

Speaker Change: A decline of 1% compared to prior year and in line with our full year guidance.

Steve Griffin: We remain committed to completing our total share repurchase plan by 2026, and we will share more information when were in a position to do so.

Speaker Change: Our commercial channel grew 17% to $42 1 million.

Steve Griffin: We ended the fourth quarter with $56 million in cash and no debt.

Speaker Change: International OA pain grew 16% in the year slightly ahead of our expectations.

Now to slide five.

Steve Griffin: Now to slide five. For the full year, Anika generated revenue of $119.9 million, a decline of 1% compared to prior year, and in line with our full year guidance. Our commercial channel grew 17% to $42.1 million. International OA pain grew 16% in the year, slightly out of our expectations. This growth highlights the outstanding work of our international sales team and distributors in gaining market share with MonoVisk, OrthoVisk, and Syngal, all three of which grew year over year, led by MonoVisk and Syngal. The launch of Integrity was the other primary driver of year-over-year revenue growth. Our commercial channel has grown at an average compounded annual growth rate of 17% for the last three years organically, and now represents 35% of total company continuing operations revenue, up from 24% in 2021.

Speaker Change: This growth highlights the outstanding work of our international sales team and distributors and gaining market share with monovisc or the bisque and cingal.

Steve Griffin: For the full year Anika generated revenue of 109, $119 9 million a decline of 1% compared to prior year and in line with our full year guidance.

Speaker Change: All three of which grew year over year led by Monovisc and Cingal.

Steve Griffin: Our commercial channel grew 17% to $42 $1 million.

Speaker Change: The launch of integrity was the other primary driver of year over year revenue growth.

Steve Griffin: International OA pain grew 16% in the year slightly ahead of our expectations.

Our commercial channel has grown at an average compounded annual growth rate of 17% for the last three years organically and now represents 35% of total company continuing operations revenue up from 24% in 2021.

Steve Griffin: This growth highlights the outstanding work of our international sales team and distributors and gaining market share with monovisc or divest and Cingal all three of which grew year over year led by Monovisc and Cingal.

Speaker Change: OEM channel revenue was $77 $8 million in 2025 down 8% year over year in line with prior guidance.

Steve Griffin: The launch of integrity was the other primary driver of year over year revenue growth.

<unk> market pressures for Monovisc in north of <unk> in the U S drove the majority of this reduction.

Speaker Change: GAAP gross margin for the year was 63% down from 68% last year.

Speaker Change: Adjusted gross margin, excluding product rationalization was 64% down from 69% last year, mainly driven by certain legacy program expenses and the impact of product mix.

Steve Griffin: OEM channel revenue was $77 $8 million in 2025 down 8% year over year in line with prior guidance.

Steve Griffin: OEM channel revenue was $77.8 million in 2025, down 8% year-over-year, in line with prior guidance. Competitive market pressures for MonoVisc and OrthoVisc in the U.S. drove the majority of this reduction. Gap gross margin for the year was 63%, down from 68% last year. Adjusted gross margin, excluding product rationalization, was 64 percent, down from 69 percent last year, mainly driven by certain legacy program expenses and the impact of product mix. Total operating expenses were $81 million, down $1 million year over year. R&D spend was higher by $4 million, driven by the HyloFast submission and Integrity product launch and line extension.

Speaker Change: Total operating expenses were $81 million down $1 million year over year.

Steve Griffin: <unk> market pressures for Monovisc and <unk> in the U S drove the majority of this reduction.

Speaker Change: R&D spend was higher by $4 million driven by the <unk> submission and integrity product line launch in line extensions.

Steve Griffin: GAAP gross margin for the year was 63% down from 68% last year.

Steve Griffin: Adjusted gross margin, excluding product rationalization was 64% down from 69% last year, mainly driven by certain legacy program expenses and the impact of product mix.

Speaker Change: Partially offset by $4 million of cost reductions from general and administrative expenses.

Speaker Change: Adjusted EBITDA from continuing operations was $15 $5 million.

Steve Griffin: Total operating.

Speaker Change: And adjusted EBITDA from discontinued operations was $2 $3 million.

Steve Griffin: <unk> expenses were $81 million down $1 million year over year.

Speaker Change: Combined for the full year total company adjusted EBITDA was in line with our previously provided range of $16 million to $18 million.

Steve Griffin: R&D spend was higher by $4 million driven by the <unk> submission and integrity product line launched in line extensions, partially offset by $4 million of cost reductions from general and administrative expenses.

Steve Griffin: partially offset by $4 million of cost reductions from general and administrative expenses. Adjusted EBITDA from continuing operations was $15.5 million and adjusted EBITDA from discontinued operations was $2.3 million. Combined for the full year, total company adjusted EBITDA was in line with our previously provided range of $16 to $18 million.

Speaker Change: As a reminder, certain corporate expenses for accounting HR, it and legal remaining continuing operations and have not been allocated to the prior periods for the discontinued operations P&L.

Steve Griffin: Adjusted EBITDA from continuing operations was $15 $5 million and adjusted EBITDA from discontinued operations was $2 $3 million.

Speaker Change: Since the third quarter Anika has generated $6 6 million in operating cash flow for the full year, we generated $5 $4 million.

Steve Griffin: Combined for the full year total company adjusted EBITDA was in line with our previously provided range of $16 million to $18 million.

<unk> improving from the $1 7 million operating cash usage in 2023.

Steve Griffin: As a reminder, certain corporate expenses for accounting, HR, IT, and legal remain in continuing operations and have not been allocated to the prior periods for the discontinued operations P&L.

Steve Griffin: As a reminder, certain corporate expenses for accounting HR, it and legal remaining continuing operations and have not been allocated to the prior periods for the discontinued operations P&L.

Speaker Change: Stronger working capital management of our core products and reduced investments into our two divested businesses have driven this positive change.

Now on slide six I'll review, our full year financial outlook for 2025.

Steve Griffin: Since the third quarter Anika has generated $6 6 million in operating cash flow for the full year, we generated $5 $4 million significantly improving from the $1 7 million dollar operating cash usage in 2023.

Steve Griffin: Since the third quarter, Anika has generated $6.6 million in operating cash flow. For the full year, we generated $5.4 million, significantly improving from the $1.7 million operating cash usage in 2023. Stronger working capital management of our core HA products and reduced investments into our two divested businesses have driven this positive change.

Speaker Change: For the year, we anticipate our commercial channel to deliver between 47 and $49 $5 million of revenue an increase of 12% to 18% in 2025.

Steve Griffin: Stronger working capital management of our core products and reduced investments into our two divested businesses have driven this positive change.

Speaker Change: This growth is driven by expanding market share for integrity, and increasing international sales of our OA pain management products.

Steve Griffin: Now on slide six I'll review, our full year financial outlook for 2025.

Steve Griffin: Now on slide six, I'll review our full year financial outlook for 2025. For the year, we anticipate our commercial channel to deliver between $47 and $49.5 million of revenue, an increase of 12 to 18% in 2025. This growth is driven by expanding market share for integrity and increasing international sales of our OA pain management products.

Speaker Change: And our OEM channel, we now anticipate revenue to be at the lower end of the range of <unk> 64 to $68 $5 million a range of 12% to 18% decline versus 2024.

Steve Griffin: For the year, we anticipate our commercial channel to deliver between 47 and $49 $5 million of revenue an increase of 12% to 18% in 2025.

Speaker Change: This update is based on the initial 2025 pricing insights from J&J <unk> and Monovisc.

This growth is driven by expanding market share for integrity, and increasing international sales of our OA pain management products.

Speaker Change: As a reminder, J&J has full control of sales marketing and pricing activities for these products in the United States and Anika receives royalties based on J&J <unk> end user pricing.

Steve Griffin: And our OEM channel, we now anticipate revenue to be at the lower end of the range of <unk> 64 to $68 $5 million a range of 12% to 18% decline versus 2024.

Steve Griffin: In our OEM channel, we now anticipate revenue to be at the lower end of the range of $64 to $68.5 million, a range of 12% to 18% decline versus 2024. This update is based on the initial 2025 pricing insights from J&J for OrthoVisk and MonoVisk. As a reminder, J&J has full control of sales, marketing and pricing activities for these products in the United States, and Anika receives royalties based on J&J's end-user pricing. We expect in the coming quarters to further tighten this revenue range.

Speaker Change: We expect in the coming quarters to further tighten this revenue range.

As expected 2025 is a challenging reset year for these two products in the U S. However, looking ahead to 26% and 27% we expect revenue in the OEM channel to remain stable or slightly lower as pricing for monovisc in orthopedics stabilize more in line with the market the historic trends.

This update is based on the initial 2025 pricing insights from J&J or divest and Monovisc.

Steve Griffin: As a reminder, J&J has full control of sales marketing and pricing activities for these products in the United States and Anika receives royalties based on J&J is end user pricing.

Speaker Change: Now turning to profitability.

Steve Griffin: We expect in the coming quarters to further tighten this revenue range.

Speaker Change: Based on J&J has new pricing, we expect adjusted EBITDA for 2025 to be between 8% and 10%.

Steve Griffin: As expected, 2025 is a challenging reset year for these two products in the U.S. However, looking ahead to 2026 and 2027, we expect revenue in the OEM channel to remain stable or slightly lower as pricing for MonoVisc and OrthoVisc stabilize, more in line with the market and historic trend.

Steve Griffin: As expected 2025 is a challenging reset year for these two products in the U S. However, looking ahead to 2006 and 27% we expect revenue in the OEM channel to remain stable or slightly lower as pricing for monovisc in north of esque stabilize more in line with the market the historic trends.

Speaker Change: Lower pricing for Monovisc in north of risk has directly impacted our royalties and we continue to seek ways to reduce our operating expenses to drive efficiency.

Speaker Change: Our 2025, adjusted EBITDA accounts for investments in our regenerative solutions portfolio and the necessary toxicity studies for the Cingal FDA filing.

Steve Griffin: Now turning to profitability.

Steve Griffin: Now turning to profitability. Based on J&J's new pricing, we expect adjusted EBITDA for 2025 to be between 8 and 10%. Lower pricing for MonoVisc and OrthoVisc has directly impacted our royalties and we continue to seek ways to reduce our operating expenses to drive efficiency. Our 2025 Adjusted EBITDA accounts for investments in our regenerative solutions portfolio and the necessary toxicity studies for the Syngal FDA filing. We are awaiting formal feedback from the FDA on bioequivalence testing for SIGGAL.

Steve Griffin: Based on J&J has new pricing, we expect adjusted EBITDA for 2025 to be between 8% and 10%.

We are awaiting formal feedback from the FDA on bioequivalence testing for Cingal.

Speaker Change: Once we receive feedback from our type C meeting with them. We will update you on our next quarterly call on any potential R&D expenses required in 2025.

Steve Griffin: Lower pricing for Monovisc in northwest has directly impacted our royalties and we continue to seek ways to reduce our operating expenses to drive efficiency.

Speaker Change: In summary, 2024 was a year of significant progress for Anika we.

Our 2025, adjusted EBITDA accounts for investments in our regenerative solutions portfolio and the necessary toxicity studies for the Cingal FDA filing.

Speaker Change: We are confident that the steps we have taken will serve to increase our growth profile for years to come.

Speaker Change: We believe the company is now in a substantially better position to drive long term sustainable growth as we continue to execute on our commercial and product development goals and objectives.

We are awaiting formal feedback from the FDA on bioequivalence testing for Cingal.

Steve Griffin: Once we receive feedback from our Type C meeting with them, we will update you on our next quarterly call on any potential R&D expenses required in 2025.

Steve Griffin: Once we receive feedback from our type C meeting with them. We will update you on our next quarterly call on any potential R&D expenses required in 2025.

Sheryl: With that I'll turn it back over to Sheryl. Thanks.

Sheryl: Thanks, Steve.

Sheryl: So as you've heard today were making excellent progress driving our refocused strategy and have line of sight to significant shareholder value creation in the not so distant future as we continue to execute.

Cheryl Blanchard: In summary, 2024 was a year of significant progress for Anika. We are confident that the steps we have taken will serve to increase our growth profile for years to come. We believe the company is now in a substantially better position to drive long-term sustainable growth as we continue to execute on our commercial and product development goals and objectives.

Steve Griffin: In summary, 2024 was a year of significant progress for Anika we.

Steve Griffin: We are confident that the steps we have taken will serve to increase our growth profile for years to come.

Sheryl: What do we need to do for that to happen, we need to continue to grow international OA pain products and integrity domestically and we need to get have a fast approved and move cingal to an NDA filing.

Steve Griffin: We believe the company is now in a substantially better positioned to drive long term sustainable growth as we continue to execute on our commercial and product development goals and objectives.

Cheryl Blanchard: With that, I'll turn it back over to Cheryl. Thanks, Steve. So as you've heard today, we're making excellent progress driving our refocus strategy and have line of sight to significant shareholder value creation in the not so distant future as we continue to execute. What do we need to do for that to happen? We need to continue to grow international OA pain products and integrity domestically. And we need to get HILOFAST approved and move SYNGALL to an NDA filing. I'm more confident than ever that we can accomplish these critical objectives. As we achieve these goals, the impact and importance of the long-standing J&J and Anika contracts will be substantially lessened as Anika will be a drastically different company.

Sheryl: With that I'll turn it back over to Sheryl. Thanks.

Sheryl: I'm more confident than ever that we can accomplish these critical objectives.

Sheryl: Thanks, Steve.

Sheryl: As we achieve these goals the impact and importance of the longstanding J&J and anika contracts will be substantially lessened as anika will be drastically different company.

Sheryl: What do we need to do for that to happen, we need to continue to grow international OA pain products and integrity domestically and we need to get hydro fast approved a move cingal to an NDA filing.

Sheryl: Moreover, our financial structure is on solid footing and we have the means to deliver on these goals without the need to raise capital.

Sheryl: We look forward to sharing our progress in the coming quarters.

Sheryl: I'm more confident than ever that we can accomplish these critical objectives.

Sheryl: Finally, I'd like to sincerely. Thank all the team members, who left the company as part of the Arthur surface in pockets divestitures.

Sheryl: As we achieve these goals the impact and importance of the longstanding J&J and anika contracts will be substantially lessened as anika will be drastically different company.

Sheryl: I wish him all the best as they continue to serve patients.

Sheryl: I would also like to thank those at Anika, who contributed to our financial performance this quarter and furthered our programs.

Cheryl Blanchard: Moreover, our financial structure is on solid footing and we have the means to deliver on these goals without the need to raise capital.

Sheryl: Moreover, our financial structure is on solid footing and we have the means to deliver on these goals without the need to raise capital.

Sheryl: Finally, I would also like to thank the distributors and surgeons, who have remained committed to anika and we look forward to continuing to work together.

Cheryl Blanchard: We look forward to sharing our progress in the coming quarters.

Sheryl: We look forward to sharing our progress in the coming quarters.

Speaker Change: Finally, I'd like to sincerely. Thank all the team members, who left the company as part of the Arthur surface in pockets divestitures.

Cheryl Blanchard: Finally, I'd like to sincerely thank all the team members who left the company as part of the Arthrosurface and Parkis divestitures. I wish them all the best as they continue to serve patients. I would also like to thank those at Anika who contributed to our financial performance this quarter and furthered our programs. Finally, I would also like to thank the distributors and surgeons who have remained committed to Anika and we look forward to continuing to work together.

Sheryl: And with that we'll open up the line for questions. Thank.

Speaker Change: Thank you ladies and gentlemen, if you do have any questions. Please press star followed by one on your Touchtone phone.

Speaker Change: I wish him all the best as they continue to serve patients.

Sheryl: You will then hear a prompt that has been raised.

Speaker Change: I would also like to thank those at Anika, who contributed to our financial performance this quarter and furthered our programs.

Speaker Change: And should you wish to decline from the polling process.

Sheryl: <unk> followed by <unk>.

Speaker Change: Finally, I would also like to thank the distributors and surgeons, who have remained committed to anika and we look forward to continuing to work together.

Sheryl: If you're using a speaker phone you will need to lift the handset before pressing any key.

Sheryl: Please go ahead and restore one now if you have any questions.

Unknown Attendee: And with that, we'll open up the line for questions. If you have any questions, please press star followed by 1 on your touch tone phone. You will then hear a prompt that your hand has been raised. And should you wish to decline from the polling process, please press star followed by 2. If you are using your speakerphone, you will need to lift the handset first before pressing any key. Please go ahead and press star 1 now if you have any questions.

And with that we'll open up the line for questions.

Sheryl: First we will hear from Jim Sidoti of Sidoti <unk> Company. Please go ahead Jim.

Speaker Change: Thank you.

Speaker Change: Ladies and gentlemen, if you do have any questions. Please press star followed by one on your Touchtone phone you will then hear a prompt that your ham has been debates and should you wish to decline from the polling process.

Jim Sidoti: Hi, good afternoon, thanks for taking the questions I'm, sorry, if I missed this.

Speaker Change: One time legacy program makes sense as you referred to.

Jim Sidoti: Some program expenses related to legacy.

Speaker Change: Press Star followed by two thank.

Speaker Change: If you're using a speaker phone you will need to lift the handset before pressing any keys.

Jim Sidoti: Product lines, there were no longer going to be carrying so kind of onetime in nature, Jim in relation to the quarter and not something we expect to continue going forward.

Speaker Change: Go ahead Crestar one now if you have any questions.

Speaker Change: First we will hear from Jim Sidoti of Sidoti and company. Please go ahead Jim.

Jim Sidoti: And what was the magnitude of that.

James Sidoti: First, we will hear from James Sidoti at Sidoti and Company. Please go ahead, James. Hi, good afternoon. Thanks for taking the questions. I'm sorry if I missed this, but what were the one-time legacy programming expenses you referred? Some program expenses related to legacy product lines that we're no longer going to be carrying. So, kind of one time in nature, Jim, in relation to the quarter, not something we expect to continue going forward. And what was the magnitude of that? It's a couple million dollars, but it's not material. So, you know, I'd say between one and two million dollars.

Jim Sidoti: It's a couple of million dollars, but it's not material. So you know I'd say between one and $2 million.

Speaker Change: Okay.

Speaker Change: Hi, good afternoon, thanks for taking the questions I'm, sorry, if I missed this but what were the one time legacy program expenses you referred to.

Jim Sidoti: And then.

Hey.

Jim Sidoti: Yeah.

Speaker Change: Some program expenses related to legacy <unk>.

Jim Sidoti: Quite a bit from.

Jim Sidoti: For prior quarters because of the divestitures.

Speaker Change: Product lines, there were no longer going to be carrying so kind of onetime in nature, Jim in relation to the quarter and not something we expect to continue going forward.

Jim Sidoti: You bet.

Jim Sidoti: Around 11 to 12 million this is adequate.

Speaker Change: And what was the magnitude of it.

Jim Sidoti: Seafood 2025.

Jim Sidoti: When times are bad.

Speaker Change: It's a couple million dollars, but it's not material so.

Jim Sidoti: I think that's a good approximation going forward.

Speaker Change: Say between one and $2 million.

Jim Sidoti: The numbers that you see here are on a continuing operations basis. So they reflect sort of the go forward of what Anika is with our focus around hyaluronic acid. Obviously, you know, Jim where John <unk> remained very focused around being lean but.

Speaker Change: Okay and then.

James Sidoti: And then, um, G&A, um, you know, down quite a bit from, uh, you know, prior, prior, prior quarters because of the divestitures, um, you know, that, that, uh, SG&A of around 11, 12 million. Is that a good proxy for 2025? Were there one times in that? I think that's a good approximation going forward. The numbers that you see here are on a continuing operations basis. So they reflect sort of the go forward of what Anika is with our focus around hyaluronic acid. Obviously, you know, Jim, we're trying to remain very focused around being lean. But in the same respect, this is the right representation of where the business is today.

Speaker Change: G&A.

Speaker Change: Quite a bit.

Speaker Change: Prior around for prior quarters because of the divestitures.

Speaker Change: You bet.

Jim Sidoti: But in the same respect this is the right representation of where the business is today.

Speaker Change: MS G&A of around $11 billion to $12 billion is that a good proxy for 2025.

Jim Sidoti: Okay.

Jim Sidoti: Alright.

Jim Sidoti: Sounds like there were some charges in R&D.

Speaker Change: You bet.

Speaker Change: I think that's a good approximation going forward.

Jim Sidoti: Nonrecurring charges could you tell me about how big those were.

Speaker Change: The numbers that you see here are on a continuing operations basis. So they reflect sort of the go forward of what Anika is with our focus around hyaluronic acid, obviously, Jim where China remained very focused around being lean.

Jim Sidoti: Yes, the <unk> filing fee was about $600000 that was for the first module that was submitted back in October of last year and Thats, a one time filing fee.

Jim Sidoti: Alright, so if you take that $6 million in R&D.

Speaker Change: But in the same respect this is the right representation of where the business is today.

Jim Sidoti: For that one.

Jim Sidoti: Yeah, I think that's a fair way to look at it I mean R&D is trending towards the higher end when we enter enter into 2025 and Thats primarily due to the fact that we have the continued work on the completion of pilot fast from a submission standpoint in the U S as well as the post market clinical trial for integrity and the work is.

Speaker Change: Alright.

James Sidoti: All right, and it sounds like there were some charges in R&D for HaloTest, you know, non-recurring charges, you know, can you tell me about how big those were? Yeah, the HILOFAST filing fee was about $600,000. That was for the first module that was submitted back in October of last year. That's a one-time filing fee. All right, so if you take that $6 million in R&D, is that a good proxy for that one? Yeah, I think that's a fair way to look at it. I mean, R&D is is trending towards the higher end when we enter enter into 2025.

Speaker Change: Sounds like there were some charges in R&D for houses.

Speaker Change: I encourage you know can you tell me about how big those were.

Speaker Change: Yes, the <unk> filing fee was about $600000 that was for the first module that was submitted back in October of last year, that's a onetime filing fee.

Jim Sidoti: Associated with toxicity for Cingal. So R&D is ticking a little higher when we enter into 2025 versus 'twenty 'twenty four but if you wanted to back that number out of your fourth quarter number on R&D you could.

Speaker Change: Alright, so if you take that out $6 million in R&D is that a good proxy for that one.

Speaker Change: Yeah, I think Thats, a fair way to look at it I mean R&D is trending towards the higher end when we enter enter into 2025 and Thats primarily due to the fact that we have the continued work on the completion of hail a fast from a submission standpoint in the U S as well as the post market clinical trial for integrity and the work is.

And then lastly.

James Sidoti: And that's primarily due to the fact that we have to continue to work on the completion of Hyalafast from a submission standpoint in the US, as well as the post market clinical trial for integrity, and the work associated with toxicity for Singol. So R&D is ticking a little higher when we enter into 2025 versus 2024.

Jim Sidoti: Thank God.

Jim Sidoti: Any major R&D expense in 2025 for Cingal.

Jim Sidoti: We have included I think I included this in my remarks, just a couple of minutes ago, but we've already built in the costs associated with the toxicity studies. So as you know there's sort of two filing items associated with single one of them was the toxicity for Monovisc that work was kicked off and Thats assumed the other one is around bio equivalents for the th.

Speaker Change: The stated with toxicity for Cingal. So R&D is ticking a little higher when we had during the 2025 versus 2024, but if you wanted to back that number out of your fourth quarter number on R&D you could.

James Sidoti: But if you wanted to back that number out of your fourth quarter number on R&D, you And then lastly, on Tsingtao, do you expect any major R&D expense in 2025 for Tsingtao? We've included, I think I included this in my remarks just a couple minutes ago, but we've already built in the costs associated with the toxicity study. So as you know, there's sort of two filing items associated with SYNGOL. One of them was the toxicity from MonoVis, that work was kicked off, and that's assumed. The other one is around bio equivalence for the TH. We'll give an update, I think when we get to the first quarter earnings call, that's what I referenced in terms of if there are any expenses from an R&D perspective, exactly how much those will be.

Speaker Change: Okay and then.

Thank God.

Jim Sidoti: We will give an update I think when we get to the first quarter earnings call. That's what I referenced in terms of if there are any expenses from an R&D perspective, exactly how much those will be.

Speaker Change: Any major R&D expense in 2025 for Cingal.

Speaker Change: We have included I think I included this in my remarks, just a couple of minutes ago, but we've already built in the costs associated with the toxicity studies. So as you know there's sort of two filing items associated with single one of them was the toxicity for Monovisc that work was kicked off and Thats assumed the other one is around bio equivalents for the th.

Jim Sidoti: Okay, but it sounds like you know the bulk.

Jim Sidoti: All of that work.

Jim Sidoti: The bulk of the expenses are done it.

Jim Sidoti: Oh, I guess responding to questions from the FDA.

Jim Sidoti: Certainly yeah, I mean in comparison to what this total program as cost overtime definitely that's the right way to conclude.

Jim Sidoti: Alright, thank you.

Speaker Change: We'll give an update I think when we get to the first quarter earnings call Thats, what I referenced in terms of if there are any expenses from an R&D perspective, exactly how much those will be.

Speaker Change: Thank you next question will be from Mike The Tuesday, and Barrington Research. Please go ahead Mike.

Mike: Hi, so sheryl.

Speaker Change: Okay, but it sounds like the bulk of that work.

James Sidoti: Okay, but it sounds like, you know, the bulk of that work, you know, the bulk of the expenses are done at this point. I guess responding to questions from the FDA. Certainly, yeah. I mean, in comparison to what this total program has cost over time, definitely that's the right way to conclude.

Jim Sidoti: Sure.

Speaker Change: The bulk of the expenses are done at this point it's.

Jim Sidoti: Excuse me in terms of the.

Oh, I guess responded to questions from the FDA.

Great progress.

Speaker Change: Anything you can share in terms of sort of uptake.

Speaker Change: Certainly yeah, I mean in comparison to what this total program as cost overtime definitely that's the right way to conclude.

Speaker Change: Take from Surgeons meeting.

It's a handful of guys sort of doing the vast majority of these or are you starting to sort of build a bear.

Alright, thank you.

James Sidoti: All right, thank you. Thank you.

Speaker Change: Thank you next question will be from Mike The Tuesday, and Barrington Research. Please go ahead Mike.

Mark Petusky: Next question will be from Mark Petusky at Barrington Research. Please go ahead. So, Cheryl, I guess I'm... Excuse me. In terms of the integrity progress, anything you can share in terms of sort of. uptake from surgeons, meaning like, you know, is a handful of guys sort of doing the vast majority of these? Or are you starting to sort of build a base of surgeons and any, you know, obviously any quantification of any progress there would be interesting. Yeah, great question, Mike. Thanks. What I would tell you is that our uptake of Integrity is being driven by a broad set of surgeons using it.

Speaker Change: Base of surgeons and any obviously any quantification of.

Mike: Hey, so.

Speaker Change: Any progress there it would be interesting thanks.

Speaker Change: Sure.

Speaker Change: Excuse me in terms of the inter.

Speaker Change: Yeah, Great question, Mike Thanks.

Speaker Change: Integrity progress.

Speaker Change: I would tell you is that.

Speaker Change: Anything you can share in terms of sort of.

Speaker Change: Our uptake of integrity is being driven by a broad set of surgeons using it. We obviously have a core group of surgeons, who were the kind of initial release surgeon, who has continued to adopt integrity in their practices, but we have built out.

Speaker Change: Uptake from surgeons, meaning like you know what.

Speaker Change: A handful of guys sort of doing the vast majority of these or are you starting to sort of build a base of surgeons and any obviously any quantification of.

Speaker Change: Any progress there would be interesting thanks.

Speaker Change: Very strong group of surgeons brought a lot of new users new relationships into Anika.

Speaker Change: Yeah, Great question, Mike Thanks.

Speaker Change: I would tell you is that.

Speaker Change: Our uptake of integrity is being driven by a broad set of surgeons using it. We obviously have a core group of surgeons who were.

Speaker Change: I'll tell you I'm at the American Academy of Orthopedic Surgeons meeting. This week, we are as a company.

Speaker Change: And we had a presentation at the Academy Unintegrated today that was standing room, only and has been very busy at the booth with a lot of interest as this product is really.

Cheryl Blanchard: We obviously have a core group of surgeons who were the kind of initial release surgeons who have continued to adopt Integrity in their practices. But we have built out a very strong group of surgeons, brought a lot of new users, new relationships into Anika.

Speaker Change: Kind of initial release surgeon, who has continued to adopt integrity in their practices.

Speaker Change: We have built out a very strong group of surgeons brought a lot of new users new relationships into anika.

Speaker Change: A technology that is addressing a lot of unmet needs that are getting surgeons excited so it's much broader than like a handful of key surgeons that are using it at this point.

Cheryl Blanchard: I'll tell you, I'm at the American Academy of Orthopedic Surgeons meeting this week. We are as a company and we had a presentation at the Academy on Integrity today that was standing room only and have been very busy at the booth with a lot of interest. This product is really a technology that is addressing a lot of unmet needs that are getting surgeons excited. It's much broader than a handful of key surgeons that are using it at this point.

Speaker Change: I'll tell you I'm at the American Academy of Orthopedic Surgeons meeting. This week, we are as a company.

Speaker Change: Alright, Great and then just turning to Cingal and forgive me if I if I if I missed this.

And we had a presentation at the academy on integrity today that was standing room only.

Speaker Change: The prepared remarks, but in terms of the go forward.

Speaker Change: <unk> has been very busy at the booth with a lot of interest in this product is really.

Speaker Change: Of any timetable as far as when the.

Speaker Change: A technology that is addressing a lot of unmet needs that are getting surgeons excited so it's much broader than like a handful of key surgeons that are using it at this point.

Speaker Change: The non clinical testing.

Speaker Change: It might be.

Speaker Change: Good.

Speaker Change: Yeah, we haven't given an updated timetable because we just have this type C meeting with FDA to get questions answered and make progress on finalizing the bioequivalence study design once I get formal feedback from FDA and I have information that I can then further communicate.

Speaker Change: Alright, Great and then just turning to Cingal and forgive me if I if I if I missed this.

Mark Petusky: All right, great.

Mark Petusky: And then just turning to Singhal, and forgive me if I missed this in the prepared remarks, but in terms of the go forward, do you have any timetable as far as when the current non-clinical testing, when that might be? Yeah, we haven't given an updated timetable because we just had this type C meeting with FDA to get questions answered and make progress on finalizing the bioequivalence study design. Once I get formal feedback from FDA and I have information that I can then further communicate, that will give me kind of the last bit that I need around the two filing issues that we know we have that we're addressing with toxicology studies, bioequivalence studies.

Speaker Change: The prepared remarks, but in terms of the go forward.

Do you have any timetable as far as when the.

Speaker Change: Turning to non clinical testing.

Speaker Change: That will give me kind of the last bit that I need around the two filing issues that we know we have that we're addressing with the tax calls you said he is bio equivalent studies and that's going to put me in a position to give a timing update as soon as we have that information back from FDA.

Speaker Change: It might be.

Speaker Change: Completed.

Speaker Change: Yes, we havent given an updated timetable because we just had this type C meeting with FDA.

Speaker Change: To get questions answered and make progress on finalizing the bioequivalence study design once I get far more feedback from FDA and I have information that I can then further communicate that will give me kind of the last bit that I need around the two filing issues that we know we have that we're addressing with tax.

Speaker Change: Okay.

Speaker Change: And then.

Speaker Change: Yeah, I guess in terms of the longer term the longer term guidance.

Speaker Change: Sure.

Red.

Speaker Change: Revenue.

Speaker Change: The commercial channel you have sort of picking up.

Speaker Change: You know from sort of 17% ish. The last few years on average to 20% to 30%.

Speaker Change: Calls you said he is bio equivalent studies and Thats going to put me in a position to give a timing update as soon as we have that information back from FDA.

Mark Petusky: And that's going to put me in a position to give a timing update as soon as we have that information back from FDA.

Speaker Change: You know in the out years and I'm just curious.

Speaker Change: Okay.

Speaker Change: Is that an acceleration of integrity like what what sort of goes into that pick up.

Mark Petusky: and then. I guess in terms of the longer term, the longer term guidance for Revenue, you know the commercial channel you have sort of picking up, you know from sort of 17 percentage the last few years on average to 20 to 30 percent You know in the out years, and I'm just curious Is that an acceleration of integrity like what what sort of goes into that pickup? Yeah, it's a great question. This year, I'd say the largest piece of the growth is going to come from integrity. And then we'll also have some continued growth from the international OA pain.

Speaker Change: And then.

Steve Griffin: Steve I guess in terms of the longer term the longer term guidance.

Speaker Change: Yes.

Speaker Change: Four.

Speaker Change: Question. This year I'd say the largest piece of the growth is going to come from integrity and then we will also have some continued growth from the international OA pain International OA pain for US has been a real bright spot. That's the lion's share of the growth of that 17% CAGR over the last couple of years, we will see it moderate to some extent this year.

Speaker Change: Revenue.

The commercial channel you have sort of picking up.

Speaker Change: From sort of 17% ish the last few years on average to 20% to 30%.

Speaker Change: You know in the out years and I'm just curious.

Speaker Change: Is that an acceleration of integrity like what what sort of goes into that.

Speaker Change: But when we get to 'twenty six what we'd expect to see is sort of that again slower growth on international away pain continued growth on integrity and then the introduction of higher law passed in the fourth quarter and then by 2007 that 20% to 30% range is really going to be mostly driven by the introduction of pile of fast that will be the first full year after the FDA approval.

Speaker Change:

Speaker Change: Yes.

Speaker Change: Great question. This year I'd say the largest piece of the growth is going to come from integrity and then we will also have some continued growth from the international OA pain.

Cheryl Blanchard: I mean, international OA pain for us has been a real bright spot. That's the lion's share of the growth of that 17% CAGR the last couple years. We'll see it moderate to some extent this year. But when we get to 26, what we'd expect to see is sort of that, again, slower growth on international OA pain, continued growth on integrity, and then the introduction of HyalaFast in the fourth quarter. And then by 27, that 20 to 30% range is really going to be mostly driven by the introduction of HyalaFast. That would be the first full year after the FDA approval.

Speaker Change: International OA pain for us has been a real bright spot that's the lion's share of the growth of about 17% CAGR over the last couple of years, we will see it moderate to some extent this year, but when we get to 'twenty six what we would expect to see is sort of that again slower growth on international away pain continued growth on integrity and then the introduction of <unk> in the fourth.

Speaker Change: <unk>.

Speaker Change: Okay. So that so that actually includes okay, we're going to we're going to.

Speaker Change: Or at least forecast revenue from Hollywood fast.

26.

Speaker Change: Yes, that's correct I mean, it's not a material amount of revenue, but it does contribute and then we'd expect to see it kind of kick in in 2007. So I think in total what youre looking at his integrity on the market today really doing an excellent job our teams and the surgeons are really I think found a great product here, we would expect to continue to take market share as we go through 'twenty.

Speaker Change: Quarter, and then by 2007 that 20% to 30% range is really going to be mostly driven by the introduction of <unk> that will be the first full year after the FDA approval.

Speaker Change: Okay. So that so that actually includes okay, we're going to we're going to add.

Cheryl Blanchard: Okay, so that so that actually includes, okay, we're going to we're going to model or at least forecast revenue from Iowa FAST in late Yes, that's correct. I mean, it's not a material amount of revenue, but it does contribute. And then we'd expect to see it kind of kick in in 27. So I think in total, what you're looking at is integrity on the market today, really doing an excellent job. Our teams and the surgeons have, you know, really, I think, found a great product here, we'd expect to continue to take market share as we go through 25.

Speaker Change: Or at least forecast revenue from Hollywood fast in late 2006.

And then in 'twenty six 'twenty seven and then in 2007, you really start to see more contribution from <unk>.

Speaker Change: Okay, Alright, alright, it sounds good. Thank you guys appreciate it.

Mike: Thanks, Mike.

Speaker Change: Thank you ladies and gentlemen, this concludes our question and answer session as well as today's conference call. We would like to thank you for taking the time to attend.

Speaker Change: I think found a great product here, we would expect to continue to take market share as we go through 'twenty five and then in 'twenty six 'twenty seven and then in 2007, you really start to see more contribution from <unk>.

Mike: You may now disconnect your lines.

Cheryl Blanchard: And then in 26 and 27. And then in 27, you really start to see more contribution from Hialeah Fast.

Speaker Change: Okay, Alright, alright, it sounds good. Thank you guys appreciate it.

Mark Petusky: All right. Sounds good. Thank you, guys. Thanks, Mike. Thank you.

Mike: Thanks, Mike.

Speaker Change: Thank you ladies and gentlemen, this concludes our question and answer session as well as today's conference call. We would like to thank you for taking the time to attend.

Unknown Attendee: Ladies and gentlemen, this concludes our question and answer session, as well as today's conference call. We would like to thank you for taking the time to attend, and you may now disconnect your lines.

Mike: You may now disconnect your lines.

Mike: Yeah.

Okay.

Mike: Yeah.

Mike: [music].

Mike: Okay.

Yes.

Mike: Yeah.

Mike: Okay.

Okay.

Mike: Yes.

Mike: Okay.

Mike: Yeah.

Mike: Yes.

Mike: Okay.

Mike: Yes.

Mike: Thanks.

Mike: Okay.

Mike: Yes.

Mike: [music].

Mike: Okay.

Mike: Yes.

Mike: Okay.

Q4 2024 Anika Therapeutics Inc Earnings Call

Request a DemoDemo

ANIK

Anika Therapeutics

Earnings