Financial Performance - Revenue decreased by 8% to $282 million in Q2 2025[9, 11], driven by a 13% decrease in OEM revenue[9, 11] - Commercial Channel revenue was flat[11] - Gross profit decreased due to lower OEM channel revenue and higher manufacturing costs[11] - R&D expenses decreased primarily due to reduced headcount and lower spend associated with product development and regulatory activities[11] - SG&A expenses decreased due to a prior year one-time, non-recurring expense along with cost actions taken in the past year[11] - Adjusted EBITDA was $02 million[9] - Adjusted EPS was $(013)[9] Business Updates - Regenerative Solutions portfolio grew 41% year-over-year[8] - International OA Pain business grew 5% sequentially, but was down 10% year-over-year due to 2024 order timing and temporary production yield issues[8] - Integrity Implant System is exceeding launch expectations and outpacing the market, on pace to more than double in 2025[8] - Hyalofast FastTRACK study did not meet pre-specified co-primary endpoints for KOOS Pain and IKDC Function[6]

Core Insights - Anika Therapeutics reported a 41% increase in Regenerative Solutions revenue, driven by the strong performance of the Integrity Implant System and continued growth of Hyalofast, which is expected to double in 2025 [1][3] - The company reaffirmed its fiscal 2025 revenue and EBITDA guidance while revising its long-term outlook due to potential delays in the FDA review for Hyalofast [1][12] Financial Performance - For Q2 2025, Anika reported revenue of $28.2 million, an 8% decrease from Q2 2024, with OEM Channel revenue down 13% and Commercial Channel revenue flat year-over-year [2][13] - Operating expenses decreased by 17% to $18.5 million, contributing to a loss from continuing operations of $4.6 million, or $0.33 per share [13][24] Product Performance - The Integrity Implant System has shown consistent growth, with procedures increasing for five consecutive quarters, and new shapes and sizes expected to enhance market adoption [4] - Hyalofast's clinical trial results showed statistically significant improvements in secondary endpoints despite not meeting primary endpoints, with plans to submit the final PMA module to the FDA in the second half of 2025 [6][12] International Sales - International OA Pain Management revenue grew 5% sequentially but declined 10% year-over-year, attributed to order timing and production yield issues [5] - The company expects to resolve production yield issues by the end of Q3 2025, maintaining confidence in achieving full-year growth projections [5][8] Future Outlook - Anika anticipates a more pronounced decline in pricing for U.S. OA Pain Management products in the second half of 2025, with normalization expected in 2026 [3] - The company updated its long-term revenue guidance for 2026-2027, projecting a growth rate of 10% to 20% for the Commercial Channel, down from previous expectations of 20% to 30% [12]

Financial Data and Key Metrics Changes - Total revenue for the first quarter was $26.2 million, down 10% compared to the same period in 2024, primarily due to pricing pressure in the OEM channel [8][19] - Gross margin decreased to 56%, down nine percentage points year over year, driven by a $4 million drop in MONOVISC and ORTHOVISC sales [21][22] - Operating expenses were $19 million, down 12% year over year, reflecting cost-saving measures [24] Business Line Data and Key Metrics Changes - Revenue in the commercial channel increased by 18% year over year to $11.3 million, with international OA pain products growing by 13% [19] - Regenerative solutions revenue grew by 33% year over year, driven by the performance of the Integrity product [20][11] - OEM channel revenue decreased by 23% to $14.9 million, primarily due to lower pricing for MONOVISC and ORTHOVISC [20][21] Market Data and Key Metrics Changes - The U.S. market for MONOVISC and ORTHOVISC continues to face pricing volatility, which has not been fully offset by measures implemented by J and J MedTech [9][10] - The company anticipates a modest pricing rebound in the second quarter, but overall OEM revenue is expected to decline by 16% to 20% for the full year [28][29] Company Strategy and Development Direction - The company is focusing on leveraging proprietary hyaluronic acid technologies and expanding its commercial channel, which has shown strong growth [6][11] - Strategic initiatives include diversifying revenue sources and enhancing product offerings, particularly in regenerative solutions [10][12] - The company is advancing its pipeline programs, including HYALOFAST and CINGAL, with expected U.S. launches in 2026 [15][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming short-term manufacturing challenges and returning to historic production levels in the second half of the year [34] - The company remains well-positioned to fund its product pipeline and expects to see improvements in gross margins in the second half of the year [32][70] Other Important Information - The company ended the quarter with $53 million in cash and no debt, indicating strong liquidity to support ongoing operations and regulatory processes [27][69] - Adjusted EBITDA guidance for 2025 has been revised to a range of negative 3% to positive 3%, reflecting lower manufacturing yields and pricing pressures [30][32] Q&A Session Summary Question: Could you elaborate on the timeline and investment needed for the CINGAL bioequivalence study? - Management expects to begin the study by the end of the year and will provide further updates as progress is made [38][39] Question: What drives the expected improvement in OEM revenue through the year? - The improvement is primarily driven by anticipated price stabilization in the second quarter [41] Question: What factors influenced the decision to maintain commercial revenue guidance? - The decision was based on strong Q1 performance and expectations of continued growth despite tougher comparisons in Q2 [42] Question: Can you provide insight into the distribution plans for CINGAL once approved? - The company is exploring various distribution opportunities and will provide more details in the future [65][66] Question: Is there sufficient cash to get through the regulatory process? - Management confirmed that the company has adequate cash to support regulatory filings for both HYALOFAST and CINGAL [69][70]

Financial Performance - Revenue decreased by 10% to $26.2 million, primarily due to a 23% decrease in OEM revenue[9, 10] - Commercial channel revenue grew by 18%, driven by International OA Pain Management which increased 13% year-over-year[9, 10] - Gross profit decreased due to lower OEM channel revenue and higher manufacturing costs[10] - Adjusted EBITDA was $0.1 million[9] - Adjusted EPS was $(0.06)[9] Guidance Update - OEM revenue guidance updated to $62 million - $65 million due to lower Monovisc and Orthovisc pricing[13] - Adjusted EBITDA guidance updated to -3% to 3% due to lower Monovisc and Orthovisc pricing, production yields, tariffs, and bioequivalence study costs[13] Strategic Initiatives - Integrity Implant System procedures are tracking to more than double in 2025[8] - Regenerative Solutions portfolio grew 33% year-over-year[8] - Completed $15 million 10b5-1 share repurchase plan ahead of schedule[8]

Core Insights - Anika Therapeutics reported a first quarter revenue of $26.2 million, a 10% decrease compared to the same period in 2024, with Commercial Channel revenue increasing by 18% driven by Integrity and international OA Pain Management growth [2][3][17] - The company achieved significant regulatory and clinical milestones for its products Hyalofast and Cingal, positioning them for future market success [4][7][8] - Anika updated its fiscal 2025 guidance, expecting OEM Channel revenue to decline due to lower pricing, while maintaining a strong cash position of $53 million with no debt [10][13] Financial Performance - Revenue from continuing operations was $26.2 million, down 10% from $29.0 million in Q1 2024 [2][17] - OEM Channel revenue decreased by 23% to $14.9 million, while Commercial Channel revenue increased by 18% to $11.3 million [2][37] - Operating expenses declined by 12% to $19.0 million, contributing to a loss from continuing operations of $4.0 million, or $0.28 per share [3][17][26] Product and Market Developments - The Integrity Implant System is on track to more than double procedures in 2025, with a 33% year-over-year growth in the Regenerative Solutions portfolio [4][5] - International OA Pain Management revenue grew by 13%, driven by geographic expansion and market share gains for Cingal and Orthovisc [6] - Anika is advancing its clinical study for Integrity, with patient enrollment underway and full site activation expected in the second half of 2025 [5] Regulatory Milestones - Anika submitted the second PMA module for Hyalofast and received MDR approval, with plans to submit the third PMA module in the second half of 2025 [7] - The company received FDA feedback confirming the path to NDA filing for Cingal, with necessary materials secured for the bioequivalence study [8][9] Shareholder Actions - The company completed a $15 million share repurchase plan in March 2025, while maintaining a strong financial position [10]