Q2 2026 Milestone Scientific Inc Earnings Call

August 14, 2026

Speaker #1: Greetings. Welcome to the Milestone Scientific Q2 2026 Financial Results and Business Update Conference Call. At this time, all participants are in a listen-only mode.

Operator: Greetings. Welcome to the Milestone Scientific Q2 2026 financial results and business update conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, James Carbonara with Hayden IR.

Speaker #1: A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.

Speaker #1: Please note, this conference is being recorded. I will now turn the conference over to your host, James Carbonara, with Hayden IR.

Speaker #2: Thank you, operator. Before we begin, please note that today’s call will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

James Carbonara: Thank you, operator. Before we begin, please note that today's call will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Please refer to our earnings release as well as our filings with the SEC, including our 2025 Form 10-K, for a discussion of these risks. A replay of this call will be available shortly after its conclusion. With that, I'll turn the call over to our CEO, Eric Hines.

Speaker #2: These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Please refer to our earnings release, as well as our filings with the SEC, including our 2025 Form 10-K, for discussion of these risks.

Speaker #2: A replay of this call will be available shortly after its conclusion. With that, I'll turn the call over to our CEO, Eric Hines.

Speaker #3: Thank you, James, and good morning, everybody. And thank you for joining our call today. Our 2nd Quarter results reflect continued execution of the strategy we laid out at the start of the year, discipline cost management, and focused investment in our highest growth opportunities.

Eric Hines: Thank you, James, and good morning, everybody. Thank you for joining our call today. Our Q2 results reflect continued execution of the strategy we laid out at the start of the year, disciplined cost management, and focused investment in our highest growth opportunities. Total revenue for Q2 was $2.8 million, an increase of 22% compared to Q2 2025, bringing our H1 revenue to $5 million, up nearly 10% year-over-year. Our base business performed very well, contributing $2.4 million in the quarter, further supported by approximately $500,000 in upside from international orders. In the medical business, CompuFlo continued to build momentum, with medical segment revenue growing 231% compared to Q2 of last year.

Speaker #3: Total revenue for the second quarter was $2.8 million, an increase of 22% compared to the second quarter of 2025, bringing our first half revenue to $5 million, up nearly 10% year over year.

Speaker #3: Our base business performed very well, contributing $2.4 million in the quarter, further supported by approximately $500,000 in upside from international orders. In the medical business, CompuFlo continued to build momentum, with medical segment revenue growing 231% compared to the second quarter of last year.

Speaker #3: While medical is still growing from a small base, there is real validation of the technology's value proposition, and we continue to scale the Compuflo advisor program launched in February adding physician advisors and expanding procedural use across additional milestone administrative contractor jurisdictions and commercial payers.

Eric Hines: While medical is still growing from a small base, there is real validation of the technology's value proposition, and we continue to scale the CompuFlo Advisor Program launched in February, adding physician advisors and expanding procedural use across additional Milestone Administrative Contractor jurisdictions and commercial payers. On the reimbursement front, our healthcare providers are actively submitting claims and have received favorable payment outcomes from Medicare in the Novitas and First Coast jurisdictions, as well as from commercial payers, which includes personal injury protection and workers' compensation plans. We currently have established $325 payments established under Novitas and First Coast fee schedules covering three regions and 13 states, and we are continuing to pursue the remaining MACs. Alongside our three distribution partners in these areas, we plan to begin launching direct sales efforts in each region starting immediately.

Speaker #3: On the reimbursement front, our healthcare providers are actively submitting claims and have received favorable payment outcomes from Medicare, as well as the Novatus and First Coast jurisdictions.

Speaker #3: As well as from commercial payers, which includes personal injury protection and workers' compensation plans. We currently have a $325 payment established under Novatus and First Coast fee schedules, covering three regions and 13 states.

Speaker #3: And we're continuing to pursue the remaining MAX alongside our three distribution partners in these areas. We plan to begin launching direct sales efforts in each region starting immediately.

Speaker #3: We also achieved an important milestone in third-party validation this quarter, following the publication of a peer-reviewed University of Texas Medical Branch study in Operative Neurosurgery, which associated CompuFlo-guided epidural access during spinal cord stimulator implantation with a 91% reduction in the odds of composite complications.

Eric Hines: We also achieved an important milestone, third-party validation this quarter, following the publication of a peer-reviewed University of Texas Medical Branch study in Operative Neurosurgery, which associated CompuFlo guided epidural access during spinal cord stimulator implantation with a 91% reduction in the odds of composite complications. The compelling evidence reinforces CompuFlo's differentiated value proposition and supports growing physician acceptance and expanded utilization across critical spinal and epidural procedures, including epidural steroid injections, spinal cord stimulator implantation, obstetric epidurals, thoracic and cervical epidurals, neuromodulation therapies, and surgical epidural anesthesia. CompuFlo has now been evaluated or utilized across more than 40 universities, academic medical centers, and teaching hospitals worldwide.

Speaker #3: The compelling evidence reinforces Compuflo's differentiated value proposition and supports growing physician acceptance and expanded utilization across critical spinal and epidural procedures, including epidural steroid injections, spinal cord stimulator implantation, obstetric epidurals, thoracic and cervical epidurals, neuromodulation therapies, and surgical epidural anesthesia.

Speaker #3: CompuFlo has now been evaluated or utilized across more than 40 universities, academic medical centers, and teaching hospitals worldwide. Subsequent to Quarter N, we expanded the addressable market for CompuFlo with a strategic distribution agreement with Red One Medical, an established federal healthcare distributor, to bring CompuFlo to the US Department of Veterans Affairs, Department of Defense, Defense Health Agency, Indian Health Services, and other federal healthcare organizations.

Eric Hines: Subsequent to quarter end, we expanded the addressable market for CompuFlo with a strategic distribution agreement with Red One Medical, an established federal healthcare distributor, to bring CompuFlo to the U.S. Department of Veterans Affairs, U.S. Department of Defense Health Agency, Indian Health Service, and other federal healthcare organizations, systems that collectively serve more than 18 million enrolled veterans and military beneficiaries. We believe this partnership gives us an efficient pathway into one of the largest and most strategically important healthcare markets in the country. On the dental side, we signed a new national distribution partner to expand our sales network and complement our e-commerce business, and we continue to build on our international footprint with a recent registration approval in Uzbekistan and additional registrations targeted in Japan, Mexico, Turkey, and India in the coming quarters.

Speaker #3: These systems collectively serve more than 18 million enrolled veterans and military beneficiaries. We believe this partnership gives us an efficient pathway into one of the largest and most strategically important healthcare markets in the country.

Speaker #3: On the dental side, we signed a new national distribution partner to expand our sales network and complement our e-commerce business, and we continue to build our international footprint with a recent registration approval in Uzbekistan and additional registrations targeted in Japan, Mexico, Turkey, and India in the coming quarters.

Speaker #3: We also launched the first phase of our AI strategy this Quarter with a pilot debut of Milo, our AI-enabled digital engagement platform, at the Aspen 2026 Conference in Miami Beach.

Eric Hines: We also launched the first phase of our AI strategy this quarter with the pilot debut of Milo, our AI-enabled digital engagement platform at the ASPN 2026 conference in Miami Beach. Milo is designed to answer product questions, provide educational information, support lead qualification, and connect healthcare professionals with our sales, clinical, and customer support teams, helping us engage prospective customers on their own time, which we believe unlocks a meaningful opportunity with small commercial teams. ASPN was also a strong showing commercially, generating more than 40 qualified leads, and it marked the launch of our #NoWetTaps campaign, building on the complication reduction data we are seeing with CompuFlo. In terms of governance, we strengthened our board of directors with Benedetta Casamento transitioning from chair to Executive Chair and the addition of two new independent directors, Greg Shilling and Kelly Ann Ulto, who bring additional healthcare, technology, finance, and governance expertise.

Speaker #3: Milo is designed to answer product questions, provide educational information, support lead qualification, and connect healthcare professionals with our sales, clinical, and customer support teams, helping us engage prospective customers on their own time, which we believe unlocks a meaningful opportunity with small commercial teams.

Speaker #3: Aspen was also a strong showing commercially, generating more than 40 qualified leads, and have marked the launch of our hashtag No Wet Taps campaign, building on the complication reduction data we're seeing with CompuFlo.

Speaker #3: In terms of governance, we strengthened our Board of Directors with Benedetta Casamento transitioning from Chair to Executive Chair, and the addition of two new independent directors, Greg Schilling and Kelly Ann Alto, who bring additional healthcare, technology, finance, and governance expertise.

Speaker #3: Turning to our capital position, we continue to operate from the $2.51 million private placement we completed in April. We are not currently planning to raise additional capital, and continue to evaluate incremental sources such as our net operating loss carryforwards and R&D tax credits programs. We remain focused on funding the business through the disciplined execution that has meaningfully narrowed our losses over the past year.

Eric Hines: Turning to our capital position, we continue to operate from the $2.51 million private placement we completed in April. We are not currently planning to raise additional capital and continue to evaluate incremental sources as our net operating loss carryforwards and R&D tax credits programs and remain focused on funding the business through the disciplined execution that has meaningfully narrowed our losses over the past year. We are reaffirming our 2026 guidance of $9.8 million to $10.2 million in total revenue, representing double-digit growth for the year, with CompuFlo expected to grow at a faster rate than the overall business for the remainder of 2026. I do want to set expectations appropriately for Q3.

Speaker #3: We are reaffirming our 2026 guidance of $9.8 million to $10.2 million in total revenue, representing double-digit growth for the year, with CompuFlo expected to grow at a faster rate than the overall business for the remainder of 2026.

Speaker #3: I do want to set expectations appropriately for the 3rd Quarter. Our 2nd Quarter benefited from two large international orders that we don't expect to recur in the 3rd Quarter.

Eric Hines: Our Q2 benefited from two large international orders that we don't expect to recur in Q3, and Q3 is typically a seasonally slower period for us given the summer months. Please keep that in mind as you model the quarter. That said, we expect our medical initiatives, including our expanding Medicare reimbursement footprint and the direct sales launch we are now making alongside our distribution partners to continue building and to contribute more meaningfully to the H2 of the year. We'll provide more detail on the trajectory alongside of our Q3 results in November. I'll now turn the call over to Keisha to review our financials. Keisha?

Speaker #3: And the third quarter is typically a seasonally slower period for us, given the summer months. Please keep that in mind as you model the quarter.

Speaker #3: That said, we expect our medical initiatives, including our expanding Medicare reimbursement footprint and the direct sales launch, we are now making alongside our distribution partners to continue building and to contribute more meaningfully to the 2nd half of the year.

Speaker #3: And we'll provide more detail on these trajectory alongside our over of our 3rd Quarter results in November. I'll now turn the call over to Keisha to review our financials.

Speaker #3: Keisha?

Speaker #2: Thank you, Eric. And good morning, everyone. For the three months ending June 30 of 2026, total revenue was $2.8 million compared to approximately $2.3 million.

Keisha Harcum: Thank you, Eric, and good morning, everyone. For the three months ending 30 June 2026, total revenue was $2.8 million, compared to approximately $2.3 million for the same period in 2025, representing an increase of approximately $518,000 or 22%. The increase in total net sales was driven by the growth in the dental product sales and continued early stage of adoption of commercialization of the company's medical products. Gross profit for the three months ending 30 June 2026, was $1.9 million, compared to $1.6 million in the prior year period. Gross margin was 67.2% for the three months ending 30 June 2026, compared to 69.6% for the same period. The decrease in gross margin was primarily due to the product and customer mix and increased product costs, including tariffs imposed and certain import products and components.

Speaker #2: For the same period in 2025, representing an increase of approximately $518,000 or $22%. The increase in total net sales was driven by the gross in the dental product sales and continue early stage of adoption of commercialization of the company's medical products.

Speaker #2: Gross profit for the three months ended June 30, 2026, was $1.9 million, compared to $1.6 million in the prior-year period. Gross margin was 67.2% for the three months ended June 30, 2026, compared to 69.6% for the same period.

Speaker #2: The decrease in gross margin was primarily due to the product and customer mix, and increased product cost, including tariffs imposed on certain import products and components.

Speaker #2: These cost pressures were partially offset by higher levels of sales during the current period. Operating expenses decreased by approximately half a million, or 4.2%, to approximately $3 million for the three months ending June 30, 2026, compared with approximately $3.1 million.

Keisha Harcum: These cost pressures were partially offset by higher levels of sales during the current period. Operating expenses decreased by approximately half a million or 4.2% to approximately $3 million for the three months ending 30 June 2026, compared with approximately $3.1 million for the three months ending 30 June 2025. The decrease was primarily attributable to the lower quality and regulatory expenses, consulting, professional fees, research and development, rent, occupational costs, and other segments. Net loss was $1.1 million or -$0.01 per share, compared to the net loss of $1.55 million. For the six months ending 30 June 2026 and 2025, the total revenue was $5 million and $4.6 million respectively, an increase of $447,000 or 9.8%.

Speaker #2: For the three months ending June 30, 2025, the decrease was primarily attributable to lower quality and regulatory expenses, consulting professional fees, research and development, rent, occupational costs, and other segments.

Speaker #2: Net loss was $1.1 million, or negative $1.00 per share, compared to a net loss of $1.55 million. For the six months ended June 30, 2026 and 2025, total revenue was $5 million and $4.6 million, respectively.

Speaker #2: To increase of $447,000, or 9.8%. Gross profit for the six months ending June 30, 2026 was $3.5 million, or 69.4% of revenue, compared to $3.3 million or 71% of revenue.

Keisha Harcum: Gross profit for the six months ending 30 June 2026 was $3.5 million or 69.4% revenue compared to $3.3 million or 71% of revenue. Operating expenses decreased by approximately $1.4 million or 20% to approximately $5.4 million for the six months ending 30 June 2026 compared to the approximately $6.7 million for the six months ending 30 June 2025. Net loss

Speaker #2: Operating expenses decreased by approximately $1.4 million, or 20%, to approximately $5.4 million for the six months ended June 30, 2026, compared to approximately $6.7 million for the six months ended June 30, 2025.

Speaker #2: Net loss

Eric Hines: We lose you, Keisha?

Speaker #3: Resolution, Keisha?

Speaker #2: Yeah. Yeah. No. I'm sorry. My the phone clicked. As of June 30, 2026, the company had cash and cash equivalents of $2.1 million and working capital of $3.7 million and $466,000 in convertible outstanding debt.

Keisha Harcum: Yeah. No, I am sorry. The phone clicked. As of 30 June 2026, the company had cash and cash equivalents of $2.1 million and working capital of $3.7 million and $466,000 in convertible outstanding debt. At this time, I will turn it back over to Eric.

Speaker #2: At this time, I'll turn it back over to Eric.

Speaker #3: All right. Thanks, Keisha. So I want to first and foremost thank everyone who wished me well on my one-year anniversary date, which was August 1, 2026.

Eric Hines: All right. Thanks, Keisha. I want to first and foremost thank everyone who wished me my one-year anniversary date, which was 1 August 2026. So thank you to those who have reached out to me. What I can say about the company is we are 180 degrees different than when I joined the company. I say that since we have added a lot of great employees and doing a lot of great things and a lot of great programs that are in place. I will leave the group here with, first of all, thank you for being shareholders and thank you for being interested in Milestone Scientific Inc., and thank you for your support. But most of all, I think our best chapters are ahead of us. So thank you, and we will turn the call over to questions at this point.

Speaker #3: So, thank you to those who have reached out to me. You know, what I can say about the company is we are 180 degrees different than when I joined the company.

Speaker #3: And I say that since we've added a lot of great employees and doing a lot of great things and a lot of great programs that are in place.

Speaker #3: And I'll I'll leave the the group here with, you know, first of all, thank you for being shareholders, and thank you for being interested in Milestone, and thank you for your support.

Speaker #3: But most of all, I think our best chapters are ahead of us. So thank you, and we'll turn the call over to questions at this point.

Speaker #1: Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad.

Operator: Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would 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. One moment, please, while we poll for questions. Your first question for today is from Bruce Jackson with StoneX.

Speaker #1: A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue.

Speaker #1: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

Speaker #1: Your first question for today is from Bruce Jackson with StoneX.

Speaker #4: Hi, good morning. Thanks for taking my questions, and congrats on the quarter. So I just wanted to clarify from the press release: How many MACs do you currently have that have the reimbursement in place?

Bruce Jackson: Hi. Good morning. Thanks for taking my questions, and congrats on the quarter. I just wanted to clarify from the press release, how many MACs do you currently have that have the reimbursement in place? Do you anticipate adding any more, and when?

Speaker #4: And then do you anticipate adding any more and when?

Speaker #3: So, we have two MACs, which cover three jurisdictions and 13 states. Those are Novitas and First Coast. We will be adding more MACs along the way.

Eric Hines: We have two MACs which cover three jurisdictions and 13 states. Those are Novitas and First Coast. We will be adding more MACs along the way. We are currently working very closely with Palmetto, then we will move to an extent westward and start to collect CGS, WPS, and Noridian. We have two currently with three jurisdictions in 13 states, representing about 30% to 35% of the population.

Speaker #3: We're currently working very closely with Palmetto, and then we'll move you know, to an extent westward and and start to collect CGS and WPS and Meridian.

Speaker #3: So we've got two currently, with three jurisdictions and 13 states, representing about 30 to 35 percent of the population.

Speaker #4: Okay, great. And then I just want to be clear on the sales guide for the third quarter. So, it's going to be down sequentially, but I'm just trying to kind of gauge how much it's going to be down from the second quarter.

Bruce Jackson: Okay, great. I just want to be clear on the sales guide for Q3. It is going to be down sequentially, but I am just trying to gauge how much it is going to be down from Q2.

Speaker #3: Right now, we're projecting, and again, I would say in the range of 2.3 to 2.5 would be the range that I would provide.

Eric Hines: Right now we're projecting, again, I would say in the range of $2.3 million to $2.5 million would be the range that I would provide.

Speaker #4: Okay. And then the last question I want to ask was, in the press release you mentioned a study where use of CompuFlo reduced composite complications, which I thought was pretty interesting.

Bruce Jackson: Okay. The last question I want to ask was, in the press release you mentioned a study where use of CompuFlo reduced composite complications, which I thought was pretty interesting. Can you kind of discuss a little bit why that is?

Speaker #4: Can you discuss a little bit why that is?

Speaker #3: Just because of the the number of, you know, I guess sometimes posts that they have to do. So for instance, the you know, with the accuracy that we come in with the copy flow, they can get much more precise as far as where they're doing the implant and so a lot of times they'll have you know, multiple sticks, if you will, that they have to go through with a traditional LOR syringe.

Eric Hines: Just because of the number of, I guess sometimes pokes that they have to do. So for instance, with the accuracy that we come in with the CompuFlo, they can get much more precise as far as where they're doing the implant. So a lot of times they'll have multiple sticks, if you will, that they have to go through with a traditional LOR syringe. Using CompuFlo within that study, they were able to reduce the missteps or the misplacement by significant amounts.

Speaker #3: And we're using copy flow within that study, they were able to reduce the the you know, the the missed the missed steps or the misplacement by, you know, significant amounts.

Speaker #4: Okay, great. That's it for me. Thank you.

Bruce Jackson: Okay, great. That's it for me. Thank you.

Speaker #3: Thanks, Bruce.

Eric Hines: Thanks, Bruce.

Speaker #1: Your next question for today is from Tom McGovern with Maxim Group.

Operator: Your next question for today is from Tom McGovern with Maxim Group.

Speaker #5: Hey, guys. Thank you for taking my question. Yeah, my first question is on the advisor program. As of the last update in Q1, you reported eight active physician partners and you had six pending.

Tom McGovern: Hey, guys. Thank you for taking my question. First question is on the advisor program. As of the last update in Q1, you guys reported eight active physician partners and you had six pending. I am just curious if you could give an update, and I am sorry if I missed it earlier in the prepared remarks, I am just curious where that is at currently.

Speaker #5: I'm just curious if you can give an update. I'm sorry if I missed it earlier in the prepared remarks, but I'm just curious where that's at currently.

Speaker #3: Yeah, we've added a few more. I think we're up to maybe 10 or 11. We're not really actively adding more advisors at this point, as we're looking to focus on the claim submission.

Eric Hines: Well, we have added a few more. I think we are up to maybe 10 or 11. We are not really actively adding more advisors at this point as we are looking to get, focusing on the claim submission. The claim submission is really what drives the reimbursement. Now that we have completed that exercise to an extent with Novitas and First Coast, we are turning our jets to other MACs. The advisor program was really put in place to get people using the product, to start submitting claims, to get feedback, and to get the Medicare reimbursement back in place. Now we are moving into Palmetto GBA and out west, with a few of the other MACs that we will start adding advisors out in those areas. We are limited a little bit by the scale. We have only got a couple people working on the medical front right now.

Speaker #3: The claim submission is really what drives the reimbursement. And now that we've completed that exercise, to an extent, with Novitas and First Coast, we're turning our jets to other MACs.

Speaker #3: So, the advisor program was really put in place to get people using the product, to get them to start submitting claims, to get feedback, and to get the Medicare reimbursement back in place.

Speaker #3: Now we're moving into Palmetto and out west, with a few of the other MACs. We will start adding advisors out in those areas.

Speaker #3: So, you know, we're limited a little bit by the scale. We've only got a couple of people working on the medical front right now.

Speaker #3: That's going to be changing here quite dramatically in the next several weeks. But we're limited by the capacity of the staff.

Eric Hines: That is going to be changing here quite dramatically here in the next several weeks. We are limited by the capacity of the staff.

Speaker #5: Understood. I appreciate that, caller. All right. Next question is, you know, again, back in 1Q, you guys gave us, you know, some some encouraging news with the digital marketing campaign.

Tom McGovern: Understood. I appreciate that color. Next question. Again, back in Q1, you guys gave us some encouraging news with the digital marketing campaign. It has contributed to 20 to 30 leads per week. I was wondering if that run rate or that rate had sustained into Q2 and what your conversion rate on those leads from Q1 was.

Speaker #5: It has contributed to, you know, 20 to 30 leads per week. I was wondering if that run rate or, you know, that rate had been sustained in Q2, and what your conversion rate on those leads from Q1 was.

Speaker #3: Yeah. So the the campaign has continued to to do extremely well. Getting anywhere at between, you know, 150 to 200 leads per per month.

Eric Hines: Yeah. The campaign has continued to do extremely well, getting anywhere between 150 to 200 leads per month. Again, we are sort of at a capacity situation. That is why we launched Milo, which is going to be the AI bot that helps sort of prosecute some of those leads while they are on the phone, because we just do not have enough people to frankly follow up. The leads continue to grow, to a point that we need to add people to handle them. In fact, we are getting ready to bring on two additional people that then all they will do is follow up on the leads because the campaigns have generated such demand that we need to find a better way to keep up with them. Milo is one of them, and then resources are another.

Speaker #3: Again, you know, we're sort of at a capacity situation, and that's why we launched Milo, which is going to be the AI bot that helps sort of prosecute some of those leads while they're on the phone.

Speaker #3: And because we just don't have enough people to, frankly, follow up. And so, you know, the leads continue to grow to a point that we need to add people to handle them.

Speaker #3: In fact, we're getting ready to bring on two additional people so that all they will do is follow up on the leads, because the campaigns have generated such demand that we need to find a better way to keep up with them.

Speaker #3: Milo is one of them, and then resources are another. So, as compared to Q1, you know, the leads continue to be just as high, if not higher.

Eric Hines: As compared to the Q1, the leads continue to be just as high, if not higher, especially now that we have sort of added medical to that cadence. It is not just the dental leads, it is hundreds of medical leads, including the great showing that we had at ASPN, where I would argue that we were the most attended booth in the entire event. We are not short of leads.

Speaker #3: And especially now that we've sort of added medical to that cadence. And so it's it's not just the dental leads. It's, you know, hundreds of medical leads, including the the great showing that we had at Aspen, where I would argue that we were the most attended booth in the entire event.

Speaker #3: So we're we're not short of leads.

Speaker #5: Got it. Got it. And then final question from me is just on the Red One Medical distribution agreement. I'm just trying to understand a little bit about the structure.

Tom McGovern: Got it. Then final question from me is just on the Red One Medical distribution agreement. I am just trying to understand a little bit about the structure. Are there any minimum purchase or stocking commitments through this agreement? If you are still working on sending out the first order, how does that contracting work between the VA and U.S. Department of Defense? Is that all pre-approved or are you guys going to have to maybe negotiate separate contracts, with each channel or with each sub-channel, rather?

Speaker #5: Are there any, you know, minimum purchase or stocking commitments through this agreement? And then, you know, if you're still working on sending out the first order, how does that contracting work between the VA and DOD?

Speaker #5: Is that all pre-approved, or are you guys going to have to, you know, maybe negotiate separate contracts with each channel or with each subchannel, rather?

Speaker #3: No. Well, it'll be on the price schedule. It'll be on the FSS schedule. And we're still working through that. So we've got the agreement in place with Red One.

Eric Hines: No, it will be on the price schedule. It will be on the FSS schedule, and we are still working through that. We have got the agreement in place with Red One. There are no minimum commitments. I think you probably know that they are a very recognized national brand in the veteran space. So we are already targeting business just out of the gate. But again, we are still waiting for some of the details to be added to the FSS schedule. Then once that is in place, everyone will buy off that schedule versus us having to go through negotiations with each of the individual agencies.

Speaker #3: There are no minimum commitments. I mean, I think you probably know that they are a very recognized national brand in the veteran space.

Speaker #3: So we've already we're already targeting business, you know, just out of the gate. But again, we're still waiting for some of the the details to be added to the to the FSS schedule.

Speaker #3: And then once that’s in place, you know, everyone will, you know, buy off that schedule versus us having to go through negotiations with each of the individual agencies.

Speaker #5: Sure. And and just for our understanding, you know, I understand that that can be, you know, a little bit of a a drawn-out process as anything with the with the government.

Tom McGovern: Sure. Just for our understanding, I understand that could be a little bit of a drawn-out process as anything with the government. But just curious, internally, what are you guys looking at in terms of a timeline to kind of work through that initial, I guess logistical or contracting push and transition to orders?

Speaker #5: But just curious, you know, internally, what are you guys looking at in terms of a timeline to kind of work through that initial, you know, I guess, like logistical or contracting push?

Speaker #5: And, you know, transition to orders.

Speaker #3: Yeah. We we we our goal is to be taking orders in Q4.

Eric Hines: Yeah. Our goal is to be taking orders in Q4.

Speaker #5: Okay. All right. Fair. I appreciate all that, caller. I'll hop out of here.

Tom McGovern: Okay.

Tom McGovern: Okay. All right. Great. I appreciate all that color. I will hop out of queue.

Eric Hines: So.

Tom McGovern: All right. Great. I appreciate all that color. I will hop out of queue.

Speaker #3: Yep.

Eric Hines: Yep.

Speaker #1: Your next question for today is from John Korb, a private investor.

Operator: Your next question for today is from John Corb, a private investor.

Speaker #3: Hey, John.

Eric Hines: Hey, John.

Speaker #4: Good morning. Good morning, Eric. Nice to be with you this morning. You said in your comments that this company is 180 degrees different than it was a year ago.

John Corb: Good morning, Eric. Nice to be with you this morning. You said in your comments that this company is 180 degrees different than it was a year ago. Congratulations on your one year. Had you not said that, I certainly got that sense from reading the quarterly report that I just finished reading. It is without a doubt the most comprehensive and hopeful quarterly report I have ever read from Milestone. I really feel like we get some traction here with Milestone and your ability to grow this company is very hopeful for me. I have one question regarding Red One Medical and any distributor. In the past, especially with the dental, distributors would be signed up, and that is all that would be, is the distributor. Nothing happened. What does a distributor agreement, what do they do? Do they sell? Do they just facilitate?

Speaker #4: Congratulations on your one year. Had you not said that, I certainly got that sense from reading the quarterly report that I just finished.

Speaker #4: It's without a doubt the most comprehensive and hopeful quarterly report I've ever read from Milestone. I really feel like we could get some traction here with Milestone, and your ability to grow this company is very hopeful for me.

Speaker #4: I have one question regarding Red Medical and any distributor. In the past, especially with the dental side, distributors would be signed up, and that's all they'd be—as the distributor.

Speaker #4: Nothing happened. What what does a distributor agreement what do they do? Do they sell? Do they just facilitate? With any distributorship you have in in anywhere, and domestically or internationally, what agreement do you have with them?

John Corb: With any distributorship you have anywhere, domestically or internationally, what agreement do you have with them from them?

Speaker #4: And from them?

Speaker #3: So so we control the pricing with the distributors versus some other other ways of going to market where, you know, they they are they're allowed to the discount up to a certain amount.

Eric Hines: We control the pricing with the distributors versus some other ways of going to market where they are allowed to discount up to a certain amount. We want to make sure that we have cost control for, I guess, a starting point. Then they obviously get points on the sales. The distributors, the way that they will work for us, for instance, in Florida, is they will act not only as additional feet on the street, but they have got a lot of technical expertise, right? Again, we are a little bit constrained from a resource perspective. The distributors will act as our clinical specialists in some cases. They will act as our salespeople in some cases. Then we will have some sort of hunters in Florida, and then we will also have sort of a strategic rep that will sort of manage that whole group, right?

Speaker #3: So we want to make sure that we have cost control for for, I guess, a starting point. So and then they obviously get you know, points on the on the sales.

Speaker #3: The distributors, the way that they'll work for us, for instance, in Florida, is they will act not only as, you know, additional feet on the street, but they will also, you know, they've got a lot of technical expertise, right?

Speaker #3: So again, we're a little bit constrained from a resource perspective. So, the distributors will act as our clinical specialists in some cases. They'll act as our salespeople in some cases.

Speaker #3: And then we will have you know, some some sort of hunters in in in Florida. And then we will also have sort of a strategic rep that will sort of manage that whole group, right?

Speaker #3: So we'll have a a, you know, strong medical technology salesperson who will work with the distributors, work with the the hunting team, and sort of, you know, chase the business in in, for instance, the state of Florida.

Eric Hines: We will have a strong medical technology salesperson who will work with the distributors, work with the hunting team, and sort of chase the business in, for instance, the state of Florida. Then we will sort of rinse and repeat and do that in New Jersey, Pennsylvania, and Texas here over the course of the next handful of months. We will have multiple distributors in each state. We are not going to just hang our hat on one single distributor. We may have two or three different distributors covering the different parts of Florida, west, east, and North Florida, for instance. That gives us technical expertise, feet on the street, and then having a single point of contact or two that are actually Milestone employees that are overseeing that and being compensated for the efficacy of the distributorships as well as their own sales.

Speaker #3: Then we will sort of rinse and repeat and do that in New Jersey, Pennsylvania, and Texas here over the course of the next handful of months.

Speaker #3: So they they they really just serve as and and and we have we'll have multiple distributors in each state. It's not we're not going to just hang our hat on one single distributor.

Speaker #3: We may have two or three different distributors covering the different parts of Florida—northern, you know, west, east, and north Florida, for instance.

Speaker #3: And that gives us technical expertise, feet on the street, and then having a a a single point of contact or or two that are actually Milestone employees that are overseeing that and and being compensated for the efficacy of the the distributorships as well as their own sales.

Speaker #3: Does that make sense?

John Corb: Great.

Speaker #4: Thanks so much, Eric. Thank you very much, and all the best going forward.

Eric Hines: I hope that makes sense.

John Corb: Thanks so much, Eric. Thank you very much, and all the best going forward.

Speaker #3: Thanks, John.

Eric Hines: Thanks, John.

Speaker #1: Once again, if you would like to ask a question, please press *1. Once again, if you would like to ask a question, please press *1.

Operator: Once again, if you would like to ask a question, please press star one. Once again, if you would like to ask a question, please press star one. Your next question for today is from Gary Carroll, a private investor.

Speaker #1: Your next question for today is from Gary Carroll, a private investor.

Speaker #5: Hey, Gary. Top of the morning. Boss, how are you doing?

Eric Hines: Hey, Gary.

Gary Carroll: Top of the morning, boss. How you doing?

Speaker #3: I'm doing good.

Eric Hines: I'm doing good.

Speaker #5: I wish you could get me up quickly for these calls, but I just want to say congratulations on where we are today versus where we were one year ago.

Gary Carroll: I wish you'd quit getting me up so early for these calls, but I just want to say congratulations on where we are today versus where we are one year ago when you stepped into this mess. Sorry I missed your anniversary. I think I was too busy trying to recruit some reps for you, but at any rate, I think the report was fantastic. I think we're moving in the right direction.

Speaker #5: And you stepped into this mess. And sorry I missed your anniversary—I think I was too busy trying to recruit some reps for you.

Speaker #5: But at at any rate, I think the report was fantastic. I think we're moving in the right direction. So I think some investors that have been here a long time, like myself, and I've gotten some feedback from other people saying, "Can you ask Eric to elaborate a little bit on where we are today versus where we are exactly two years ago at the ASP end meeting, by the way, when we first got Medicare approval?" And the previous regime, I don't want to mention his name because I might get sick, took that and did nothing.

Gary Carroll: I think some investors that have been here a long time like myself, and I've gotten some feedback from other people saying, can you ask Eric to elaborate a little bit on where we are today versus where we are exactly two years ago at the ASPN meeting, by the way, when we first got Medicare approval and the previous regime, I don't want to mention his name because I might get sick, took that and did nothing. We got reimbursement, and we got no follow-through. I think there's a big difference happening now because obviously we and you realize the importance that now that we have that, we have to run with that code and start submitting, and I know we already are submitting cases into First Coast here in Florida, of course, which is my location and my interest.

Speaker #5: So we got reimbursement, and we got no follow-through. And I think there's a big difference happening now because, obviously, we—and you—realize the importance that now that we have that, we have to run with that code and start submitting.

Speaker #5: And I know we are already submitting cases to First Coast here in Florida, of course, which is my location and my interest. So, do we actually have a group, or is there some kind of group, in Tampa?

Gary Carroll: So do we actually have a group or that group in Tampa? I think we had some guys in Tampa that really helped us resubmit the cases that we needed to get Evelyn to be able to get us back to where we are today that now we can run with the ball. From your point of view, what is the difference? Because I know you have been here also during that time with Arjan. So where are we today in your mind versus where we were then? Because I think a lot of people want to know we got it now. We are going to get this done. Can you shed a little light on where you think we are, the difference?

Speaker #5: I think we had some guys in Tampa that really helped us submit, resubmit the cases that we needed to get Evelyn to be able to get us back to where we are today, that now we can run with the ball.

Speaker #5: So from your point of view, what's the difference? Because I know you've been here also during that time with Arjan. So, where are we today in your mind versus where we were then?

Speaker #5: Because I think a lot of people want to know why we’ve got it now. We’re going to get this done. And can you shed a little light on where you think we’re, you know, the difference?

Speaker #3: Yeah. So I—I mean, I don't really know exactly what happened prior. I mean, I was a shareholder, like all of us were back then, but I didn't pay too much attention.

Eric Hines: Yeah. I do not really know exactly what happened prior. I was a shareholder like all of us were back then, but I did not pay too much attention, but I paid enough attention to understand that something did not seem like it was going in the right direction. I think the difference now is that we have sort of done it a little bit more systematically. So we have gone, I guess, a little bit. Sometimes they say you got to go slower to go faster, and I am a big believer in that. So we have put things in place as far as reimbursement teams to help the medical offices to prosecute the claims. That is a big help.

Speaker #3: But I paid enough attention to understand that something didn't seem like it was going in the right direction. So I think the difference now is that we've sort of done it a little bit more systematically, mathematically.

Speaker #3: So, we've gone, I guess, a little bit—sometimes they say you've got to go slower to go faster. And, you know, I'm a big believer in that.

Speaker #3: And so we've put things in place as far as reimbursement teams, to help the medical offices to prosecute the claims. That's a big help.

Speaker #3: And we've, you know, now we're putting a team in the state of Florida, which will be four or five people that are, you know, just solely going after the comp flow business.

Eric Hines: Now we are putting a team in the state of Florida, which will be 4 or 5 people that are just solely going after the CompuFlo business and doing it sort of in a much more methodical way. I think really it is just, quite honestly, it is not spraying and praying and hoping and putting CompuFlo all over the map and all over the world, quite frankly. It is focus, and it is focus and getting it right and getting the right systems and processes in place, and then it is replicating it across the rest of the country. So, I would not anticipate that we are just going full force and adding and adding MACs until we show that we have had a lot of success in Florida. We will obviously move into the Novitas regions with Texas and Pennsylvania, New Jersey.

Speaker #3: And and doing it sort of in a in a much more methodical way. So I I think really it's just quite honestly, it's not it's not spraying and praying and and hoping and and and putting comp flow all over the map and all over the world, quite frankly.

Speaker #3: It's focus, and it's focus on getting it right and getting the right systems and processes in place. And then it's replicating it across the rest of the country.

Speaker #3: So, you know, I wouldn't anticipate that we're, you know, just going full force and adding and adding max until we get, you know, show that we've had a lot of success in Florida.

Speaker #3: And I will obviously move into the NovaTOS region, with Texas and Pennsylvania and New Jersey. But we're going to do it systematically.

Eric Hines: But we are going to do it systematically, we are going to do it with the right programs in place to support the offices and the office managers. I think that is really just the. It is kind of subtle, but it is going a little bit slower to make sure that we can accelerate once we get to a critical mass.

Speaker #3: We're going to do it with the right programs in place to support the offices and the office managers. And you know, so I think that's really just the it's kind of subtle, but it's it's, you know, going a little bit slower to to make sure that we can accelerate once we get to a a critical mass.

Speaker #5: Along that line, Eric, are we going to have specific people trained to go into, for instance—you know, I'm down in Southeast Florida.

Gary Carroll: Along that line, Eric, are we going to have specific people trained to go into? For instance, you know I am down in Southeast Florida, and we are getting excited about getting this thing launched. Are we going to have a support person or people that will come in and train the office staff on how these claims have to be submitted? Because I think there has to be some justification, if I am correct, on the doctor using the CompuFlo. For instance, in a very difficult cervical case, it is an elderly patient with a lot of arthritis. There has to be something that goes along with that claim, correct?

Speaker #5: We're getting excited about getting this thing launched. Are we going to have a support person or people that will come in and train the office staff on how these claims have to be submitted?

Speaker #5: Because I think there has to be some justification if I'm correct on the doctor using the CompuFlo, for instance, in a very difficult cervical case.

Speaker #5: It's an elderly patient with a lot of arthritis. There has to be something that goes along with that claim, correct?

Speaker #3: There does, right? I mean, it has to be coded properly, with all the I's dotted and T's crossed. It's actually a really good idea.

Eric Hines: There does. It has to be coded properly, and all the I's dotted and T's crossed. It is actually a really good idea. I just wrote it down that providing some training. We have Evelyn and her entire group, she is with a new company called Omnicare, which has many resources, and they spend their life in getting products approved and working through that process. I jotted that down, but I think it makes a lot of sense because we are doing a little bit of that, but we probably need to do more.

Speaker #3: So I just wrote it down that, you know, providing some training. And we and we've got Evelyn and her entire group with with a she's with a new company called Omnir.

Speaker #3: Which has many, many resources, and they spend their life getting products approved and working through that process. So I jotted that down, but I think it makes a lot of sense because we're doing a little bit of that, but we probably need to do more.

Speaker #5: Well, I I think so because if we have the reps going in and they're getting the accounts, the doc wants to use it, he's excited, we get it in, we get an order, we start using it, well, if that rep has to stop then and take time to go train, you know, the office staff or the billing people, that's going to slow down the process of being of the sales process.

Gary Carroll: Well, I think so, because if we have the reps going in and they are getting the account, the doc wants to use it, he is excited. We get it in, we get an order, we start using it. If that rep has to stop then and take time to go train the office staff or the billing people, that is going to slow down the sales process. If we have that backup of somebody supporting us with what you just said, the billing and claims and training those people, first of all, they are going to get paid a lot quicker, and they are going to submit it correctly, and we are going to get what we need as far as the tracking for these cases to be tracked.

Speaker #5: So, if we have that backup of somebody supporting us with what you just said—the billing and claims—and training those people, first of all, they're going to get paid a lot quicker.

Speaker #5: And they're going to submit it correctly, and we're going to get what we need as far as the tracking for these cases to be tracked.

Speaker #3: 100%. We're on the same page.

Eric Hines: 100%. We are on the same page.

Speaker #5: I think that's—well, what else was I— I had something else to ask you, but... so now we have— we got to grow a group in Tampa.

Gary Carroll: I think that is. Well, what else was I had something else to ask you. Now we got a group in Tampa. Those guys that helped us are still submitting, correct? We still got users, regular users that helped us get through that are still submitting cases.

Speaker #5: Those guys that helped us are still submitting, correct? Are we still getting users—regular users that helped us get through that—are they still submitting cases?

Speaker #3: Yes.

Eric Hines: Yes.

Speaker #5: And that's important, right? We want to keep that, we've got to keep it flowing. Hang on, that $500,000 on that $500,000 international order—was that a big dental order that came in, by the way?

Gary Carroll: That is important, right? We got to keep it flowing.

Eric Hines: No doubt.

Gary Carroll: Hang on. On that $500,000 international order, was that a big dental order that came in, by the way?

Eric Hines: Yes.

Speaker #5: Okay, so we're not really planning on that recurring for this quarter, as you just stated.

Gary Carroll: Okay. We are not really planning on that recurring for this quarter, as you just stated.

Speaker #3: Not at this point, no. That was a good question.

Eric Hines: Not at this point, no. That was a one-time thing.

Speaker #5: All right. Well, I know you're I know it's getting to be it's going to be 9 o'clock here. Now, listen, congratulations again. I think a lot of us most of us are very excited that you're progress.

Gary Carroll: Well, I know it is going to be 9:00 here. Now listen, congratulations again. I think a lot of us, most of us are very excited at your progress. I think you are putting a good team together. Jason, Josh, they are working hard. Josh is doing a great job down in Florida. I think we might have somebody new down in Florida soon, according to what I am hearing, which will be fantastic to get us rolling. You know this is the biggest territory in the country, buddy. So if we can get this going, I think we are going to be in good shape.

Speaker #5: I think you're putting a good team together. Jason and Josh, they're working hard. Josh is doing a great job down in Florida. I think we might have somebody new down in Florida soon, according to what I'm hearing, which will be fantastic to get us rolling.

Speaker #5: You know, this is the biggest territory in the country, buddy. So, if we can get this going, I think we're going to be in good shape.

Speaker #3: We appreciate your support, Gary.

Eric Hines: We appreciate your support, Gary.

Speaker #5: All right, pal. Thank you.

Gary Carroll: All right, pal. Thank you.

Speaker #3: Yes.

Eric Hines: Yes.

Operator: We have reached the end of the question and answer session. I will now turn the call over to Eric Hines for closing remarks.

Speaker #1: We have reached the end of the question and answer session, and I will now turn the call over to Eric Hines for closing remarks.

Speaker #3: Nope. Just once again, thanks, everybody. It was a it was a good quarter. We plan on having more good quarters. That's the that's the plan.

Eric Hines: Look, just once again, thanks everybody. It was a good quarter. We plan on having more good quarters. That's the plan. I cannot thank you enough for your support along the way. We will be in touch. Thank you. Have a good day.

Speaker #3: And I can't thank you enough for your support along the way. We will be in touch. Thank you. Have a good day.

Operator: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.