Financial Data and Key Metrics Changes - Net product revenue for Q2 was $100.8 million, down 23% year over year, within the guidance range of $100 million to $110 million [16] - Advanced Wound Care net product revenue was $92.7 million, down 25%, while Surgical and Sports Medicine products revenue increased by 16% to $8.1 million [16][20] - Gross profit for Q2 was $73.1 million, representing 73% of net product revenue, down from 78% the previous year [17] - Operating expenses decreased to $113.6 million from $144.1 million, a reduction of 21% year over year [17] - GAAP net loss for Q2 was $9.4 million, compared to a net loss of $17 million last year, showing improvement [18] Business Line Data and Key Metrics Changes - Advanced Wound Care products saw a revenue decline of 25%, attributed to customer demand disruptions and competitive pricing strategies [5][16] - Surgical and Sports Medicine products experienced a revenue increase of 16%, indicating strong performance in this segment [16] Market Data and Key Metrics Changes - The proposed Medicare payment reform for skin substitutes is expected to significantly impact the market, with a proposed rate of approximately $125 per square centimeter [30] - The current market for Aplograft is only 3% of units sold, indicating substantial growth potential with the new payment structure [31] Company Strategy and Development Direction - The company is focused on gathering clinical and real-world evidence to enhance its product portfolio and market penetration [10] - Expansion of biomanufacturing capabilities is underway, with a new facility in Smithfield, Rhode Island, aimed at supporting product reintroduction and new launches [11] - The RENEW program is on track for submission by the end of the year, targeting a significant market of over 30 million Americans suffering from knee osteoarthritis [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the proposed CMS payment reforms, viewing them as a transformational opportunity for the company and the industry [30] - The company anticipates aggressive pricing strategies from competitors in the latter half of 2025 but remains confident in its product momentum [33] - The guidance for 2025 has been updated, expecting net revenue between $480 million and $510 million, reflecting a year-over-year change of flat to a 6% increase [19][20] Other Important Information - The company has no outstanding debt obligations and reported cash and equivalents of $73.7 million as of June 30, 2025, down from $136.2 million at the end of 2024 [19] - Adjusted EBITDA loss for Q2 was $3.6 million, compared to adjusted EBITDA income of $15.6 million last year, indicating a significant shift in profitability [18] Q&A Session Summary Question: How does the CMS proposal for 2026 impact the company? - Management views the CMS proposal as a transformational event, providing a significant opportunity for their products and leveling the playing field in reimbursement [30][31] Question: Has the guidance reduction accounted for aggressive market behavior? - Management believes the guidance reduction reflects the current market conditions and anticipates strong performance from recently launched products in the second half of the year [34][35] Question: What is the timing for the reintroduction of Dermagraft? - Management indicated that Dermagraft is expected to be launched by 2027 [37] Question: How does RENEW position itself in the knee OA treatment landscape? - Management highlighted the strength of RENEW's data, indicating it will compete well against existing injectable options [41] Question: What drove the strength in the Surgical and Sports Medicine segment? - The segment's growth was attributed to strong performance and the implementation of hybrid sales strategies, with a 16% increase in Q2 [42]

Financial Data and Key Metrics Changes - Net revenue for Q1 2025 was $86.7 million, down 21% year-over-year [16] - Advanced Wound Care net revenue was $79.9 million, down 23% [17] - Surgical and Sports Medicine products net revenue was $6.8 million, up 11% [17] - Gross profit was $63 million, or 72.6% of net revenue, compared to 73.9% last year [17] - Operating loss for Q1 was $26.7 million, compared to an operating loss of $3.9 million last year [17] - GAAP net loss for Q1 was $18.8 million, compared to a net loss of $2.1 million last year [18] - Adjusted EBITDA loss for Q1 was $12.5 million, compared to adjusted EBITDA of $2.6 million last year [19] Business Line Data and Key Metrics Changes - Advanced Wound Care products experienced a significant decline in revenue, while Surgical and Sports Medicine products showed growth [17] - The company faced challenges due to the delayed implementation of the LCD, impacting customer demand and ordering patterns [5][6] Market Data and Key Metrics Changes - The market environment remains uncertain due to the delayed LCD, which has affected customer behavior and buying patterns [5][6] - The company is optimistic about the long-term opportunity as changes in coverage policies are expected to be implemented in 2026, potentially increasing patient access [10] Company Strategy and Development Direction - The company is focused on gathering robust clinical and real-world evidence to support its product portfolio and drive market penetration [11] - The RENEW program is on track, with expectations for a BLA submission by the end of 2025, targeting a large pain management market [12] - The company is expanding its manufacturing capabilities with a new biomanufacturing facility, which will support the introduction of new products [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the challenging market and reaffirmed financial guidance for 2025 [9][19] - The company anticipates a stabilization of market dynamics in the second half of 2025, despite ongoing uncertainties [26][58] Other Important Information - The company has $110.5 million in cash and cash equivalents as of March 31, 2025, with no outstanding debt [19] - The 2025 revenue guidance remains between $480 million and $535 million, with expectations for a gradual improvement in business trends [20] Q&A Session Summary Question: Inquiry about the cadence throughout the year and guidance confidence - Management expressed confidence in the guidance, highlighting optionality in the portfolio and the availability of PuraPly across all indications [24][25] Question: Clarification on gross margin expectations - Management indicated that gross margins are expected to improve in the second half of the year due to a mix shift in the product portfolio and reduced expirations [28][30] Question: Comparison of Q1 performance to Q4 and market dynamics - Management noted that confusion regarding the LCD led to a contraction in the market, which was not present in Q4 [36][37] Question: Future changes in the LCD and CMS involvement - Management believes that CMS is reviewing coverage policies and that the delay allows for more data collection, which could positively impact product approvals [41][42] Question: Guidance reiteration despite LCD delays - Management explained that the broader product portfolio and higher-margin products provide flexibility to maintain guidance despite the LCD delay [50][54]

Financial Data and Key Metrics Changes - The company reported net revenue for Q1 2025 of $86.7 million, a decrease of 21% year-over-year [15] - Advanced Wound Care net revenue was $79.9 million, down 23%, while Surgical and Sports Medicine products revenue increased by 11% to $6.8 million [16] - Gross profit for Q1 was $63 million, representing 72.6% of net revenue, compared to 73.9% in the previous year [16] - Operating loss for Q1 was $26.7 million, significantly higher than the operating loss of $3.9 million in the prior year [17] - GAAP net loss for Q1 was $18.8 million, compared to a net loss of $2.1 million last year [17] - Adjusted EBITDA loss for Q1 was $12.5 million, compared to adjusted EBITDA of $2.6 million in the previous year [18] Business Line Data and Key Metrics Changes - Advanced Wound Care experienced a revenue decline of 23%, while Surgical and Sports Medicine products saw an increase of 11% [16] - The company expects net revenue from Advanced Wound Care products for 2025 to be between $450 million and $500 million, indicating a year-over-year change of a decline of 1% to an increase of 10% [19] - Surgical and Sports Medicine products are projected to generate revenue between $30 million and $35 million, representing a year-over-year increase of 6% to 23% [19] Market Data and Key Metrics Changes - The company noted disruptions in customer demand and ordering patterns due to uncertainty surrounding the effective date of the final LCD for skin substitute grafts [5] - The delay in the LCD implementation until January 1, 2026, is expected to provide an opportunity for the company to serve more patients and positively impact the wound care market [10] Company Strategy and Development Direction - The company is focused on gathering robust clinical and real-world evidence to enhance its product portfolio and market penetration [11] - The RENEW program is on track, with expectations to complete the second Phase III study by the end of Q2 2025 and submit a BLA by the end of the year [12] - The company is expanding its manufacturing capabilities with a new biomanufacturing facility in Smithfield, Rhode Island, which will support the reintroduction of key products [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term opportunities for the company, particularly with the expected changes in coverage policies in 2026 [10] - The company anticipates a challenging environment in the first half of 2025, followed by significant improvement in business trends starting in Q3 [19] - Management emphasized the importance of educating customers to stabilize buying behaviors and return to previous purchasing patterns [53] Other Important Information - The company reaffirmed its financial guidance for 2025, expecting net revenue between $480 million and $535 million, with a year-over-year change of roughly flat to an increase of 11% [19] - The company has $110.5 million in cash and cash equivalents as of March 31, 2025, with no outstanding debt obligations [18] Q&A Session Summary Question: Inquiry about the cadence throughout the year and guidance confidence - Management expressed confidence in the guidance, highlighting the optionality in the portfolio and the execution capabilities despite market uncertainties [22][23] Question: Clarification on gross margin expectations - Management indicated that gross margins should improve in the second half of the year due to a mix shift in the product portfolio and reduced expiries [26][27] Question: Comparison of Q1 performance to Q4 and market dynamics - Management noted that confusion regarding the LCD led to a contraction in the market, which was not present in Q4 [34] Question: Discussion on the delay of the LCD and its implications - Management explained that the delay allows for more data collection and could expand the number of products eligible for coverage, which is seen as positive [40][41] Question: Further clarification on guidance and expected inflection points - Management reiterated that the full portfolio is now available, which supports revenue stabilization and growth despite the LCD delay [48][49]

Financial Data and Key Metrics Changes - The company reported net revenue for Q4 2024 of $126.7 million, a 27% increase year-over-year, exceeding previous guidance [14][16] - Gross profit for Q4 was $96 million, representing 75.5% of net revenue, up from 72.1% the previous year [14][15] - GAAP net income for Q4 was $7.7 million, compared to a net loss of $0.6 million last year, marking an increase of $8.3 million [15][16] - Adjusted EBITDA for Q4 was $18.2 million, or 14.4% of net revenue, compared to $7.5 million or 7.5% of net revenue last year [16] Business Line Data and Key Metrics Changes - Advanced Wound Care net revenue for Q4 was $119 million, up 27% year-over-year [14][16] - Net revenue from surgical and sports medicine products for Q4 was $8 million, an increase of 24% [14][16] - For the full year 2024, net revenue was $482 million, an 11% increase from $433.1 million in 2023, driven by a 12% increase in Advanced Wound Care products [16] Market Data and Key Metrics Changes - The company anticipates a challenging operating environment in the first half of 2025 due to delays in the implementation of LCDs, with expectations for improvement in the second half [8][20] - The final LCD ruling will affect 18 products, including key offerings like Aplograph and Dermagraft, while over 200 products will be classified as non-covered [9][10] Company Strategy and Development Direction - The company is focused on gathering clinical and real-world outcomes data to enhance its product portfolio and market penetration [10] - The RENEW program is a key strategic focus, with plans for a BLA submission by the end of 2025, targeting a large pain management market [12][14] - The company is advocating for a value-based payment methodology for skin substitute products to improve patient access and reduce Medicare expenditures [7][10] Management's Comments on Operating Environment and Future Outlook - Management noted that the delayed effective date for the final LCD ruling has created ambiguity and disruption in customer behavior, impacting demand [8][9] - The company expects significant improvement in business trends beginning in Q3 2025, following the implementation of the LCDs [20] - Management expressed confidence that the LCDs will be implemented as scheduled, despite potential for confusion in the market [36][38] Other Important Information - The company ended Q4 2024 with $136.2 million in cash and no outstanding debt, a significant improvement from $104.3 million in cash and $66.2 million in net debt obligations at the end of 2023 [17] - The company introduced financial guidance for 2025, expecting net revenue between $480 million and $535 million, with a focus on Advanced Wound Care products [18][19] Q&A Session Summary Question: Market competitiveness and customer behavior - Management indicated that there has not been a major change in the competitive environment, but customer buying behavior has shifted due to reimbursement dynamics [22][23] Question: Timeline for RENEW product submission - The company expects to file the BLA submission by the end of 2025 and anticipates FDA feedback in Q4 2026, with potential approval by late 2026 or early 2027 [25] Question: Sales force attrition and retention - Some attrition was noted, but it was not significant, and the company has successfully backfilled positions with good talent [29] Question: Progress on RCTs for non-covered products - The company expects to have an interim analysis for the PuraPly study in Q4 2025, with publication anticipated in Q1 2026 [30] Question: Assumptions regarding LCD implementation - Management believes the LCD will be implemented as planned, with no significant delays expected, despite potential for rescission [36][38]

Financial Data and Key Metrics Changes - The company reported net revenue for Q4 2024 of $126.7 million, a 27% increase year-over-year, exceeding previous guidance [15][19] - Gross profit for Q4 was $96 million, representing 75.5% of net revenue, up from 72.1% the previous year [15][16] - Operating income for Q4 was $10.2 million, compared to an operating loss of $1.3 million last year, marking an increase of $11.5 million [16] - GAAP net income for Q4 was $7.7 million, compared to a net loss of $0.6 million last year, an increase of $8.3 million [16] - Adjusted EBITDA for Q4 was $18.2 million, or 14.4% of net revenue, compared to $7.5 million or 7.5% of net revenue last year [17] Business Line Data and Key Metrics Changes - Advanced Wound Care net revenue for Q4 was $119 million, up 27% year-over-year [15] - Net revenue from surgical and sports medicine products for Q4 was $8 million, an increase of 24% [15] Market Data and Key Metrics Changes - The company anticipates a challenging operating environment in the first half of 2025 due to delays in the implementation of LCDs, with expectations for improvement in the second half [9][21] - The final LCD ruling will affect 18 products, including key offerings like Aplograph and Dermagraft, while over 200 products will be classified as non-covered [10] Company Strategy and Development Direction - The company is focused on gathering robust clinical and real-world outcomes data to enhance its product portfolio and market penetration [11] - The RENEW program is a key strategic focus, with plans for a BLA submission by the end of 2025, targeting a large pain management market [14][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the stronger customer demand in Q4 was due to less disruption in the marketplace related to the delayed effective date for the final LCD ruling [6][9] - The company expects significant improvement in business trends beginning in Q3 2025, following the implementation of the LCDs [10][21] Other Important Information - The company had $136.2 million in cash and cash equivalents as of December 31, 2024, with no outstanding debt obligations [18] - Financial guidance for 2025 includes net revenue expectations between $480 million and $535 million, with a focus on Advanced Wound Care products [19][20] Q&A Session Summary Question: Market competitiveness and customer behavior - Management indicated that there is no major change in the competitive environment, but customer buying behavior has shifted due to reimbursement dynamics [23][24] Question: Timeline for RENEW product submission - The company expects to file the BLA submission at the end of 2025 and anticipates FDA feedback in Q4 2026, with potential approval by late 2026 or early 2027 [26][27] Question: Sales force attrition and retention - Some attrition was noted, but it was not significant, and the company has successfully backfilled positions [31] Question: Progress on RCTs for non-covered products - The PuraPly study is expected to have an interim analysis in Q4 2025, with publication anticipated in Q1 2026 [32] Question: Assumptions regarding LCD implementation - Management believes the LCD will be implemented as planned, despite potential for rescission if CMS is dissatisfied [38][40]