MiMedx(US:MDXG)2021-08-04 18:27Financial Data and Key Metrics Changes - In Q2 2021, net sales increased by 27% year-over-year to $68.2 million, primarily driven by the Advanced Wound Care business [6][32] - Adjusted net sales, excluding the impact of revenue recognition changes, grew by 31% [6][33] - Gross profit margin was 81.3%, down from 84.7% in the same period last year, impacted by inventory reserves and increased manufacturing costs [35][36] - Net loss for Q2 2021 was $1.8 million, compared to a net loss of $8.5 million in the same period a year ago [41] Business Line Data and Key Metrics Changes - Advanced Wound Care products saw a 29% growth, driven by EPICORD Expandable and the EPIFIX portfolio [34] - Sales of Section 351 products increased by 44% compared to the prior year, which were significantly impacted by the pandemic [34] Market Data and Key Metrics Changes - The company achieved its goal of increasing the sales force by 10%, now totaling 289 customer-facing sales professionals [8] - The easing of COVID restrictions allowed for more effective sales and medical education programs [9][10] Company Strategy and Development Direction - The company is focused on expanding its Advanced Wound Care business and enhancing its product offerings [5][12] - A collaboration with Wake Forest University Institute for Regenerative Medicine aims to advance scientific evidence for clinical therapies [11] - Regulatory approval for EPIFIX in Japan is underway, with potential to reach 100,000 patients annually once reimbursement is established [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to adapt to potential COVID spikes and maintain sales momentum [10][73] - The company is optimistic about its pipeline, with key milestones expected in the coming months for clinical trials [22][26] Other Important Information - The company was added to the Russell 3000 and Russell 2000 indexes and anticipates being added to the NASDAQ Biotech Index in Q4 2021 [42] - The company is preparing for a potential BLA filing for its amniotic tissue products, which would be a significant milestone [24][27] Q&A Session Summary Question: Concerns about core products and 351 classification - Management does not believe EPICORD products will be affected by Enforcement Discretion due to their manufacturing and promotional methods [49][50] Question: Status of CGMP for processing facilities - One facility received a VAI, and the company is awaiting further updates from the FDA [51][52] Question: Drivers for EPICORD revenue growth - EPICORD Expandable allows targeting deeper wounds, providing a unique treatment option [58][59] Question: Impact of Enforcement Discretion on demand - The company is educating customers on viable alternatives and believes it can capture market share from competitors affected by Enforcement Discretion [62][65] Question: International product approvals beyond Japan - Current focus is on EPIFIX for wound applications in Japan, with future assessments for AMNIOFIX [74] Question: Timing for R&D day - Late fall is anticipated for the R&D day, depending on FDA meeting outcomes [67][68] Question: Processing time for trial results - The company is being thorough in its analysis, which may take longer due to the size of the studies [81][82] Question: Evidence of AMNIOFIX's regenerative properties - Preclinical studies show growth factors in AMNIOFIX that may modulate wound healing processes [89][90]