UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 0-23837 Surmodics, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Id ...

| --- | --- | |--------------------------------------------------------|-------| | | | | Gary Maharaj President and CEO | | | Tim Arens Senior Vice President of Finance, IT and CFO | | | NOVEMBER 2020 | | 2 SAFE HARBOR Some of the statements made during this presentation may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about our vision and its impact to investors, ...

Surmodics, Inc. (NASDAQ:SRDX) Q4 2020 Earnings Conference Call November 4, 2020 5:00 PM ET Company Participants Timothy Arens - Chief Financial Officer Gary Maharaj - President and Chief Executive Officer Thomas Greaney - Chief Operating Officer of Medical Devices Conference Call Participants Brooks OÂ'Neil - Lake Street Capital Markets David Saxon - Needham & Company Operator Good day and welcome to the Surmodics Fourth Quarter Fiscal 2020 Earnings Conference Call. TodayÂ's conference is being recorded. At ...

| --- | --- | |--------------------------------------------------------|-------| | | | | | | | | | | Gary Maharaj President and CEO | | | Tim Arens Senior Vice President of Finance, IT and CFO | | | AUGUST 2020 | | 2 SAFE HARBOR Some of the statements made during this presentation may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about beliefs and expectations rega ...

Surmodics, Inc. (NASDAQ:SRDX) Q3 2020 Earnings Conference Call August 5, 2020 5:00 PM ET Company Participants Tim Arens - Vice President, Finance & Chief Financial Officer Gary Maharaj - Chief Executive Officer Conference Call Participants Jim Sidoti - Sidoti & Company Brooks O'Neil - Lake Street Capital Markets David Saxon - Needham & Company Operator Good day, and welcome to the Surmodics Third Quarter Fiscal 2020 Earnings Conference Call. Today's conference is being recorded. At this time, I would like t ...

Surmodics, Inc. (NASDAQ:SRDX) Q2 2020 Earnings Conference Call April 29, 2020 5:00 PM ET Company Participants Tim Arens – Vice President-Finance and Chief Financial Officer Gary Maharaj – Chief Executive Officer Conference Call Participants Brooks O'Neil – Lake Street Capital Markets Jim Sidoti – Sidoti & Company Mike Matson – Needham & Co Mike Petusky – Barrington Research Operator Good day, and welcome to the Surmodics Second Quarter Fiscal 2020 Earnings Conference Call. TodayÂ's conference is being recor ...

Financial Data and Key Metrics Changes - Total revenue for Q1 2020 grew 2% to $22.6 million compared to $22.2 million in Q1 2019 [4][20] - Diluted GAAP earnings were $0.01 per share, while non-GAAP earnings were $0.05 per share in Q1 2020 [4][27] - Medical Device revenue grew 1% to $17.4 million, while In Vitro Diagnostics (IVD) revenue increased 5% to $5.2 million [20][21] Business Line Data and Key Metrics Changes - Medical Device coatings revenue was slightly up, offsetting lower SurVeil license fee and milestone revenue, which decreased by $1.1 million to $1.3 million [21][22] - IVD business unit revenue was up 5% compared to the prior year, outperforming the immunoassay market growth rate of 3% [17][24] Market Data and Key Metrics Changes - The Medical Device business segment is expected to face headwinds due to patent expirations, with anticipated revenue declines of $5 million to $5.5 million for the full fiscal year [22][24] - IVD operating margin improved to 50% from 49% in the prior year quarter, with product gross margins increasing to 68% from 64% [24] Company Strategy and Development Direction - The company aims to ensure the success of SurVeil, advance product development across its pipeline, and optimize revenue from legacy offerings to fuel growth initiatives [5][6] - The innovative product pipeline includes drug-coated balloons and thrombectomy devices, with significant progress expected in clinical studies and regulatory approvals [11][12] Management's Comments on Operating Environment and Future Outlook - Management remains confident in achieving double-digit revenue growth annually, despite challenges related to paclitaxel matters affecting the therapeutic modality [19][20] - The company is committed to rigorous clinical research to demonstrate the safety and efficacy of its devices, with a focus on enhancing foundational elements for long-term growth [18][19] Other Important Information - The company added Dr. Nusrat Sultana as Vice President of Clinical Affairs to drive clinical strategy and support product development [18] - Cash and investments totaled $48.3 million at the end of the quarter, with significant payments made for contingent earn-out obligations and capital expenditures [27] Q&A Session Summary Question: Update on the partnership with Medtronic - The company has shipped several orders and expects Medtronic to launch Telemark in the coming months, with revenue expectations of $0.5 million to $1 million for each of the partnered products [31][33] Question: CE Mark submission status - There are no updates on the CE Mark for SurVeil, but the notified body has registered in Continental Europe, and ongoing communications are taking place [34][35] Question: SG&A expense increase - The increase in SG&A expenses is attributed to headcount additions for clinical support and product pipeline development [43][44] Question: Impact of Coronavirus - Management does not expect any impact on the IVD business and has not heard of negative impacts on the Medical Devices segment [47][48] Question: SurVeil milestones and CE Mark implications - The most likely milestone for fiscal 2020 is the attainment of the CE Mark, with no additional milestones communicated at this time [51][52] Question: R&D capital allocation changes - The company will be more thoughtful in capital allocation due to delays in CE Mark approvals, but R&D guidance remains unchanged [61][64]

Financial Data and Key Metrics Changes - Total revenue for Q4 2019 grew 34% to $30.8 million compared to $23 million in Q4 2018 [9][35] - Diluted GAAP earnings were $0.26 per share, while non-GAAP earnings were $0.37 per share in Q4 2019, compared to a loss of $0.13 per share in Q4 2018 [50] - Operating cash flow for Q4 was $12.5 million, contributing to a total of $8 million for fiscal 2019 [51] Business Line Data and Key Metrics Changes - Medical Device revenue increased by 46% to $24.8 million in Q4 2019, driven by strong growth in royalty and license fee revenue [36][37] - In Vitro Diagnostics (IVD) revenue totaled $6 million, down slightly from the previous year, impacted by lower sales of distributed antigen products [41] - R&D services revenue increased by 52% to $3.2 million, reflecting higher demand from coatings customers [39] Market Data and Key Metrics Changes - The Medical Device coatings portfolio continued to grow in the low to mid-single digits, despite challenges from patent expirations [34] - The IVD business unit outperformed the immunoassay market growth of 3%, generating excellent operating margins [34] Company Strategy and Development Direction - The company aims to ensure the success of SurVeil and continue advancing product development and regulatory approvals across its pipeline [12][13] - Strategic objectives for fiscal 2020 include optimizing revenue and cash flow from legacy businesses while advancing new product initiatives [14][22] - The company is focused on building a complete line of radial access products and enhancing its thrombectomy platform [30][32] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing challenges posed by the paclitaxel debate but expressed confidence in the data supporting their products [11][20] - The company expects fiscal 2020 revenue to range from $87 million to $91 million, excluding potential revenue from SurVeil until more clarity is achieved [52][54] - Management anticipates a diluted loss per share in the range of $0.60 to $0.30 for fiscal 2020, reflecting the impact of patent expirations and other factors [55] Other Important Information - The company has submitted all required modules for CE Mark approval for SurVeil but faces delays due to the ongoing paclitaxel debate [19][20] - The company has received Breakthrough Device Designation status from the FDA for Sundance, indicating potential for significant future growth [26] Q&A Session Summary Question: Clarification on guidance and anticipated payments for Sundance - Management clarified that there are no anticipated license fees or milestone payments associated with the Sundance drug-coated balloon in fiscal 2020 [60][61] Question: Impact of patent expirations on revenue - Management confirmed that the royalty headwind from the expiration of the fourth-generation hydrophilic coating patents is expected to be about $5 million to $5.5 million in fiscal 2020 [67][68] Question: CE Mark approval process and potential alternatives - Management indicated that the notified body has paused the review of new CE Marks for paclitaxel devices, and they are exploring options to address this issue [81][82] Question: Details on milestone payments related to Abbott SurVeil - Management stated that over 50% of the $25 million milestone payment from Abbott has been recognized, with the remaining amount to be recognized over the next 60 months [149]

Financial Data and Key Metrics Changes - Revenue for Q3 2019 was $24.3 million, a 9% increase from $22.2 million in Q3 2018 [31] - Diluted GAAP earnings were $0.11 per share, compared to a loss of $0.20 per share in the prior year [41] - Non-GAAP earnings per share were $0.15, down from $0.27 in the prior year [42] - The company raised its full-year revenue guidance to a range of $92 million to $94 million, up from $88.5 million to $91.5 million [43] Business Line Data and Key Metrics Changes - The medical device business unit generated $18.9 million in revenue, a 13% increase year-over-year [32] - In-vitro diagnostics (IVD) revenue totaled $5.4 million, down 2% compared to the prior year [34] - Royalty and license fee revenue in the medical device segment was $11.6 million, up $2 million from the prior year [32] - R&D services revenue increased by 31% to $2.9 million [33] Market Data and Key Metrics Changes - The medical device business grew 13% despite a tough comparison quarter [28] - IVD business is expected to see modest mid-single-digit growth, while the medical device business anticipates double-digit growth [29] Company Strategy and Development Direction - The company aims to ensure the success of the SurVeil program and complete patient enrollment in the TRANSCEND study [9] - Focus on advancing drug-coated balloon programs and non-drug delivery device portfolio [9] - Plans to commercialize up to 15 innovative technologies over the next five years [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustainable growth and the ability to navigate challenges [6] - The company is optimistic about completing the TRANSCEND trial enrollment by the end of Q4 fiscal 2019 [15] - Management noted the importance of quality-of-life impacts for patients in the context of regulatory discussions [50] Other Important Information - The company completed preclinical studies for the Sundance drug-coated balloon and is targeting regulatory approval for a first-in-human trial by the end of fiscal 2019 [20] - An agreement was signed with a leading multinational medical device partner for the Telemark coronary support catheter [26] Q&A Session Summary Question: What is the expected outcome from the FDA regarding paclitaxel devices? - Management believes the FDA will consider quality-of-life impacts and may provide recommendations that could help the market recover [57] Question: Can you provide details on the Telemark agreement? - The agreement is a distribution agreement where Surmodics will manufacture the product and receive a transfer price [61] Question: What is the expected revenue from SurVeil? - Revenue from SurVeil is expected to be between $7.5 million to $8 million for the year, with additional revenue recognized upon trial completion [78]

Financial Data and Key Metrics Changes - Total revenue for Q2 2019 grew 19% to $22.7 million compared to $19.1 million in Q2 2018, marking four consecutive quarters of double-digit revenue growth [29] - GAAP diluted earnings were $0.09 per share, down from $0.11 per share in Q2 2018, while non-GAAP earnings remained at $0.07 per share for both periods [39] - The company updated its full-year revenue guidance to $88.5 million to $91.5 million, down from previous expectations of $94 million to $97 million [41][42] Business Line Data and Key Metrics Changes - The Medical Device segment reported a 23% revenue growth, increasing to $17.3 million, while the In Vitro Diagnostics (IVD) segment revenue was $5.4 million, up 7% [29][27] - Royalty and license fee revenue in the Medical Device segment totaled $9.9 million, up $1.5 million from the prior year [30] - Product sales increased by 24%, benefiting from recent product launches in Ireland [31] Market Data and Key Metrics Changes - IVD revenue growth of 7.4% outperformed the immunoassay market growth rates of 2% to 3% [27] - The company noted that the recent FDA communication regarding paclitaxel-coated devices has created uncertainty in the market, impacting enrollment rates in clinical studies [9][10] Company Strategy and Development Direction - The company aims to transform into a complete provider of full product solutions, focusing on the success of SurVeil and advancing its drug-coated balloon pipeline [6][13] - Surmodics plans to commercialize up to 15 innovative technologies over the next five years, targeting unmet clinical needs and expanding its addressable market [21] - The company is committed to maintaining strong performance in its Medical Device and IVD businesses while navigating regulatory challenges [28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving double-digit revenue growth despite uncertainties surrounding paclitaxel-coated devices [11][28] - The company is closely monitoring enrollment rates in the TRANSCEND trial and has adjusted its financial guidance accordingly [10][42] - Management emphasized the importance of patient safety and welfare in response to FDA recommendations [10] Other Important Information - The company received FDA 510(k) approval for its Sublime guide sheath, enhancing its product offerings for radial access [7][23] - The TRANSCEND trial is over 75% enrolled, but recent FDA communications have impacted enrollment rates [9][16] Q&A Session Summary Question: What do you expect the FDA panel to ask about? - Management speculated that the FDA panel may inquire about the signal of mortality associated with paclitaxel and the implications for clinical practices [46][48] Question: Is there a risk that the trial could slow down further? - Management acknowledged the uncertainties but emphasized their commitment to achieving the milestone and balancing risks in their guidance [52][53] Question: What is the impact of the controversy on the addressable market for drug-coated balloons? - Management indicated that estimates of market impact vary widely, with some institutions suggesting a potential reduction in usage [57][58] Question: How is Abbott responding to the current situation? - Management noted that Abbott has been supportive and engaged, emphasizing the importance of the therapeutic modality [61][62] Question: Is there potential to use different drugs with the SurVeil technology? - Management stated that while it is a possibility, it would require significant time and careful evaluation due to the complexities involved [63][64]