Company Overview - TELA Bio, Inc. is a commercial-stage medical technology company focused on innovative soft-tissue reconstruction solutions that optimize clinical outcomes by preserving and restoring the patient's own anatomy [2] - The company aims to provide advanced and economically effective solutions for surgeons, leveraging the patient's natural healing response while minimizing long-term exposure to permanent synthetic materials [2] Upcoming Events - TELA Bio will participate in the Canaccord Genuity 45 Annual Growth Conference, with management scheduled to present on August 13, 2025, at 10:00 am ET [1] - Interested parties can access the live and archived webcast of the presentation at ir.telabio.com [1]

Core Viewpoint - TELA Bio, Inc. is set to report its second quarter 2025 financial results on August 11, 2025, and will host a conference call and webcast to discuss these results and provide a corporate update [1]. Group 1: Financial Reporting - The second quarter 2025 financial results will be reported on August 11, 2025 [1]. - A conference call and webcast will take place at 4:30 p.m. ET on the same day to discuss the financial results [1]. Group 2: Company Overview - TELA Bio, Inc. is a commercial-stage medical technology company focused on innovative soft-tissue reconstruction solutions [3]. - The company aims to optimize clinical outcomes by preserving and restoring the patient's own anatomy while minimizing long-term exposure to synthetic materials [3].

Core Points - TELA Bio, Inc. announced the approval of an inducement grant of stock options and restricted stock units to Jim Hagen, the Senior Vice President of Strategic Commercial Operations, as part of his employment compensation [1][2] - The stock options have an exercise price of $1.42 per share, with a ten-year term and a vesting schedule over four years [2] - TELA Bio focuses on innovative soft-tissue reconstruction solutions that prioritize the preservation and restoration of the patient's own anatomy [3] Summary by Category Inducement Grant Details - The Compensation Committee approved an option to purchase 75,000 shares and restricted stock units covering 30,000 shares for Jim Hagen [1] - The stock options will vest 25% on the first anniversary of the grant date, with the remaining 75% vesting in equal monthly installments over the following 36 months [2] - The restricted stock units will vest in equal annual installments over four years [2] Company Overview - TELA Bio is a commercial-stage medical technology company [3] - The company aims to provide advanced, economically effective soft-tissue reconstruction solutions that leverage the patient's natural healing response [3] - TELA Bio minimizes long-term exposure to permanent synthetic materials in its solutions [3]

Summary of TELA Bio Conference Call Company Overview - **Company**: TELA Bio - **Industry**: Medical Supplies and Devices - **Focus**: Soft tissue restoration and preservation, specifically in hernia repair and plastic/reconstructive surgery [4][5] Key Markets and Products - **Hernia Repair Market**: Estimated at over $1.5 billion, with 80% of current implants made from polypropylene, which is facing scrutiny due to complications [6][9] - **Plastic and Reconstructive Surgery Market**: Estimated at around $1 billion, with a shift away from cadaver skin towards engineered composite solutions [9] - **Product Lines**: - Hernia-based product line compatible with robotic surgery - Engineered composite solutions for breast reconstruction [4][5] Competitive Landscape - **Market Position**: TELA Bio holds approximately 10-12% market share in complex ventral procedures and 3-4% in the overall hernia market [17] - **Competitive Advantage**: Unique reinforced tissue matrix with patent protection, offering superior clinical results and lower complication rates compared to traditional polypropylene meshes [6][8][10] - **Market Evolution**: Increasing interest in alternatives to polypropylene and cadaver skin, with TELA Bio positioned to capture market share as these materials decline in use [18][19] Economic Perspective - **Pricing Strategy**: TELA Bio's hernia portfolio is priced 30-40% lower than first-generation biologics and 20-25% lower than temporary plastic materials, while still being a premium option over permanent plastics [13][14] - **Cost Savings**: The company emphasizes significant cost savings for hospital systems, which enhances its value proposition [23] Sales and Market Growth - **Sales Growth**: From 2020, TELA Bio has seen substantial growth, targeting $85 million to $88 million in sales for the current year [16] - **Product Acceptance**: Positive reception of inguinal hernia products, with expectations of increased market penetration as awareness grows [25][28] - **Sales Strategy**: The introduction of Liquefix as a fixation device has broadened TELA Bio's portfolio, enhancing its perception as a comprehensive hernia solutions provider [31] Financial Outlook - **Cash Runway**: Current cash reserves are expected to be sufficient to reach profitability, with a target revenue of $27.5 million to cover operating expenses [68][69] - **Operating Expenses**: Expected to remain flat with revenue growth, allowing for operational leverage as sales increase [71][72] Clinical Data and Product Performance - **Clinical Studies**: TELA Bio has gathered substantial clinical data supporting the efficacy of its products, which is expected to drive growth in the plastic and reconstructive surgery market [51][52] - **Competitive Landscape in PRS**: The market is shifting away from cadaver skin products, with TELA Bio's offerings gaining traction due to their cost-effectiveness and clinical performance [57] Supply Chain and Tariffs - **Manufacturing Location**: Products are manufactured in New Zealand, with a 10% import tax impacting gross margins minimally [48][49] - **Mitigation Strategies**: Plans to ship directly to Europe to avoid tariffs, which currently account for a small portion of total gross margin impact [49] Conclusion - TELA Bio is strategically positioned in the evolving medical supplies market, focusing on innovative solutions for hernia repair and plastic surgery. The company is leveraging its unique product offerings, competitive pricing, and strong clinical data to capture market share and drive growth.

Core Insights - TELA Bio, Inc. has launched OviTex Inguinal Reinforced Tissue Matrix in Europe, specifically designed for laparoscopic and robotic-assisted inguinal hernia repair [1][6] - The product follows a successful U.S. launch in 2024, achieving over $1 million in sales in its first year [2] - OviTex Inguinal offers two configurations in Europe, enhancing compatibility with laparoscopic and robotic procedures [3] Product Details - OviTex Inguinal is part of the OviTex portfolio, utilizing layers of ovine rumen interwoven with polymer for added strength while minimizing permanent polymer footprint [4] - The product has over 8 years of clinical experience with more than 69,000 implantations and over 40 published works demonstrating its clinical efficacy [4] - A study showed a low 1.2% recurrence rate in patients undergoing robotic inguinal hernia repair using the ReBAR technique, with an average follow-up of 1.5 years [5] Market Opportunity - The expansion of robotic-assisted procedures in Europe presents significant opportunities for naturally derived devices like OviTex Inguinal [6] - The product aligns with the European market's emphasis on shared decision-making between surgeons and patients, making it a compelling option for clinical performance and patient expectations [6] Company Overview - TELA Bio, Inc. focuses on innovative technologies that optimize clinical outcomes by preserving and restoring the patient's anatomy [8] - The company aims to provide advanced, economically effective soft-tissue reconstruction solutions while minimizing long-term exposure to synthetic materials [8] Indications for Use - OviTex Reinforced Tissue Matrix is intended for surgical mesh applications to reinforce and repair soft tissue weaknesses, including inguinal hernias [9]

Core Viewpoint - TELA Bio, Inc. has appointed Jeffrey Blizard as President to enhance its leadership team and drive the next phase of growth in the medical technology sector, particularly in soft-tissue reconstruction solutions [1][2]. Leadership Changes - Jeffrey Blizard, previously on TELA Bio's Board of Directors, brings extensive industry experience and a successful track record from his role as Global Head of Surgical Sales at Abiomed, contributing to significant growth in that division [1][2]. - The CEO of TELA Bio, Antony Koblish, emphasized that Blizard's leadership will enhance the company's competitive edge and commercial performance in a dynamic market [2]. Company Overview - TELA Bio, Inc. is focused on innovative technologies for soft-tissue reconstruction, aiming to optimize clinical outcomes by preserving and restoring the patient's anatomy [3]. - The company is committed to providing advanced, economically effective solutions that leverage the patient's natural healing response while minimizing reliance on permanent synthetic materials [3].

Company Overview - TELA Bio, Inc. is a commercial-stage medical technology company focused on innovative soft-tissue reconstruction solutions [2] - The company aims to optimize clinical outcomes by preserving and restoring the patient's own anatomy [2] - TELA Bio provides advanced, economically effective solutions that leverage the patient's natural healing response while minimizing long-term exposure to permanent synthetic materials [2] Upcoming Events - TELA Bio will participate in the 2025 Jefferies Global Healthcare Conference [1] - The management is scheduled to present at 11:05 am ET on June 5, 2025 [1] - Interested parties can access the live and archived webcast at ir.telabio.com [1]

Group 1: Earnings Performance - TELA Bio reported a quarterly loss of $0.25 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.21, representing an earnings surprise of -19.05% [1] - The company posted revenues of $18.52 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 6.13%, compared to revenues of $16.6 million a year ago [2] - Over the last four quarters, TELA Bio has not surpassed consensus EPS estimates and has topped consensus revenue estimates only once [2] Group 2: Stock Performance and Outlook - TELA Bio shares have declined approximately 68.5% since the beginning of the year, contrasting with the S&P 500's decline of -4.3% [3] - The current consensus EPS estimate for the upcoming quarter is -$0.17 on revenues of $20.2 million, and for the current fiscal year, it is -$0.63 on revenues of $85.2 million [7] - The estimate revisions trend for TELA Bio is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Group 3: Industry Context - The Medical - Biomedical and Genetics industry, to which TELA Bio belongs, is currently in the top 33% of over 250 Zacks industries, suggesting a favorable outlook [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact TELA Bio's stock performance [5]

Financial Data and Key Metrics Changes - Revenue for the first quarter of 2025 was $18,500,000, representing a 12% increase year-over-year and a 5% sequential growth from the fourth quarter of 2024 [4] - Gross margin decreased to 67.6% from 68.3% in the prior year, primarily due to excess and obsolete inventory adjustments [13] - Net loss for the first quarter was $11,300,000 compared to $5,700,000 in the prior year, largely affected by the previous year's sale of the Nivas product line [15] Business Line Data and Key Metrics Changes - Revenue from OviTex grew 15% year-over-year, while OviTex PRS revenue grew 2% [12] - OviTex unit sales increased by 29% for the quarter, while PRS unit sales declined slightly by 3% [12] - The company reached over 69,000 OviTex hernia implantations since inception, with OviTex IHR and Liquefix each generating over $1,000,000 in sales since their launch in 2024 [9] Market Data and Key Metrics Changes - The European business saw a 17% growth over the first quarter of 2024, indicating strong international demand [5] - The hernia market is shifting away from plastic mesh towards more natural repair products, which positions the company favorably [8] Company Strategy and Development Direction - The company is focused on expanding its commercial organization, with plans to increase the number of territory managers and account specialists [6] - The introduction of larger sizes of OviTex PRS products aims to simplify complex procedures and improve operational efficiency for surgeons [9] - The company is committed to bringing new and complementary products to market, enhancing its product portfolio [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to achieve its 2025 revenue guidance of $85,000,000 to $88,000,000, representing growth of 23% to 27% over 2024 [5][16] - The management highlighted the importance of stability and strength in the sales force, emphasizing a long-term growth strategy rather than short-term gains [25][26] Other Important Information - The company is currently facing a 10% tariff on products shipped from New Zealand, which is expected to negatively impact gross margin by 50 to 100 basis points [11] - The company is working to mitigate tariff impacts by adjusting shipping strategies [11] Q&A Session Summary Question: What are the key factors for continuing sequential growth through the end of the year? - Management noted that historical revenue patterns indicate a larger step up from Q1 to Q2, with continued traction from sales representatives driving growth [21][22] Question: Any changes in competitive hiring dynamics? - Management indicated that the hiring environment has stabilized, with a strong sales force and high morale contributing to retention [27][28] Question: Clarification on tariff impact on gross margin? - Management explained that the tariff impact will gradually affect gross margin starting in Q2, with a projected negative effect of 50 to 100 basis points [38][39] Question: How is the bundling situation with GPOs playing out? - Management emphasized the need to increase the number of surgeons using their products in facilities to justify their market position [45][46] Question: Updated expectations on growth rates for PRS and OviTex? - Management expects continued good growth from both products, with PRS anticipated to grow faster due to its higher average selling price [51][54]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $18.5 million, representing a 12% increase year-over-year and a 5% increase sequentially from Q4 2024 [4][12] - Gross margin decreased to 67.6% from 68.3% in the prior year, primarily due to excess and obsolete inventory adjustments [13] - Net loss for Q1 2025 was $11.3 million compared to $5.7 million in the prior year, largely affected by the previous year's gain from the sale of the Nivas product line [14] Business Line Data and Key Metrics Changes - Revenue from OviTex grew 15% year-over-year, while OviTex PRS revenue grew 2% [12] - Unit sales of OviTex increased by 29% for the quarter, while PRS unit sales declined slightly by 3% [12] - The company has seen strong demand for both OviTex and OviTex PRS, with revenue for each growing approximately 152% [4] Market Data and Key Metrics Changes - The European business experienced a 17% growth over Q1 2024, indicating a strong international opportunity [5] - The hernia market is shifting away from plastic mesh towards more natural repair products, which positions the company favorably [7][29] Company Strategy and Development Direction - The company is reaffirming its 2025 revenue expectation of $85 million to $88 million, representing growth of 23% to 27% over 2024 [5][15] - The new territory manager and account specialist structure is yielding positive results and is expected to enhance sales effectiveness [6] - The company is committed to bringing new and complementary products to market, including larger sizes of OviTex PRS [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the commercial organization and its ability to drive growth, emphasizing the importance of stability and strength in the sales force [24] - The company is positioned well for continued growth, particularly as the industry moves away from plastic mesh [17] - Management acknowledged the impact of tariffs on gross margin but expects only a modest effect [11][38] Other Important Information - The company has trained 25 new sales team members year-to-date, which is expected to contribute positively to sales [6] - The company is actively working to mitigate the impact of tariffs by adjusting shipping strategies [11] Q&A Session Summary Question: Revenue cadence through the back half of the year - Management noted that historical revenue patterns suggest a larger increase from Q1 to Q2, a smaller increase from Q2 to Q3, and a larger increase from Q3 to Q4 [21][22] Question: Competitive hiring dynamics - Management indicated that the competitive hiring environment has stabilized, with a focus on maintaining morale and a strong sales force [26] Question: Clarification on tariff impact on gross margin - Management explained that the tariff impact would gradually affect gross margin starting in Q2 and continuing into Q3 [37][38] Question: Bundling situation at GPOs - Management emphasized the importance of increasing the number of surgeons using their products in each facility to justify their market position [44][46] Question: Updated expectations on growth rates for PRS and OviTex - Management expects continued good growth from both products, with PRS anticipated to grow faster due to its higher average selling price [50][51]