Financial Data and Key Metrics Changes - Aziyo Biologics reported Q3 2021 revenue of $11.5 million, a 3% decrease from $11.8 million in Q3 2020 and a 5.6% decrease from $12.2 million in Q2 2021 [23] - Year-to-date total revenues exceeded $36 million, representing a 21% increase over the same period in 2020 [7] - Gross margin for Q3 2021 was 32.1%, down from 47.1% in Q3 2020 and 46.2% in Q2 2021 [27] - Total operating expenses for Q3 2021 were $10.7 million, a 30% increase from $8.2 million in Q3 2020 [28] - Net loss for Q3 2021 was $8.3 million, compared to a net loss of $6.7 million in Q3 2020 [29] Business Line Data and Key Metrics Changes - Net sales of core products were $8.6 million in Q3 2021, down from $10.3 million in Q3 2020, while non-core products saw an increase to $2.9 million from $1.4 million [24] - The decline in core products was primarily due to a decrease in the orthopedic and spinal repair business following the discontinuation of FiberCel sales by its distributor [24] - Sales of CanGaroo and SimpliDerm showed growth, offsetting some declines in other areas [25] Market Data and Key Metrics Changes - Increased sales of CanGaroo in Europe were attributed to the launch of a new expanded label allowing hydration in gentamicin solution prior to implantation [12] - The company experienced improved productivity from its U.S. direct sales force, with higher utilization in existing accounts and new account openings [11] Company Strategy and Development Direction - Aziyo plans to scale its commercial organization and advance CanGaroo RM, a next-generation product with antibiotics, with an expected FDA filing in Q1 2022 [8] - The company aims to generate clinical data and expand market access for SimpliDerm, with ongoing clinical studies and publications planned for 2022 [14] - In the orthopedic and spine business, Aziyo anticipates onboarding additional partners and launching new viable bone matrices [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating challenges posed by COVID-19 and highlighted strong performance in CanGaroo and SimpliDerm despite headwinds [36] - The outlook for Q4 2021 includes expectations for core product sales to remain similar to Q3 results, with growth anticipated in 2022 driven by CanGaroo RM and additional partnerships [31] Other Important Information - The company is participating in a patient support program related to the FiberCel recall, aiming to support affected patients [9] - Aziyo has implemented new screening and testing procedures to enhance product safety, which are expected to set new industry standards [18] Q&A Session Summary Question: Impact of COVID-19 on Q3 performance - Management noted that despite COVID-19 disruptions, CanGaroo and SimpliDerm performed well, with a larger order from a non-core customer contributing to Q3 sales [36] Question: Guidance for Q4 sales - Management indicated that Q4 sales would likely see a step down due to the non-recurrence of a large order and ongoing challenges in the viable bone matrix business [39] Question: Growth expectations for CanGaroo and SimpliDerm - Management refrained from providing specific growth percentages but expressed optimism about the potential for both products in 2022 [41] Question: M&A strategy - Management stated that while they are exploring tuck-in acquisitions, they remain focused on organic growth opportunities within their existing product lines [50] Question: FiberCel's impact on core business growth - Management confirmed that excluding FiberCel, there was sequential growth in the core business, driven by CanGaroo and SimpliDerm [54]
Elutia(ELUT) - 2021 Q3 - Earnings Call Transcript