Vericel (US:VCEL)2023-02-23 19:55Financial Data and Key Metrics Changes - For the full year 2022, total revenue exceeded $164 million, with MACI revenue growing 18% to $132 million, and record quarterly revenue of nearly $53 million in Q4 [7][25] - The company achieved a gross margin of 73% and an adjusted EBITDA margin of nearly 30% in Q4, both of which increased compared to the prior year [7][27] - Net income for Q4 was approximately $6 million, representing over 30% growth compared to Q4 2021 [7][28] Business Line Data and Key Metrics Changes - MACI revenue in Q4 was over $46 million, reflecting 24% growth year-over-year and approximately 50% sequential growth from Q3 2022 [8][25] - Epicel revenue for Q4 was lower than anticipated at $6.3 million, with a decline in the incidence of large burns impacting overall performance [9][26] - Total burn care revenue for the year was $32.4 million, with Epicel contributing $31.7 million and NexoBrid generating $0.7 million [26] Market Data and Key Metrics Changes - The company reported a record number of approximately 2,000 surgeons taking biopsies in 2022, marking a 10% increase from 2021 [8] - The approval of NexoBrid significantly increases the addressable market for the burn care franchise to over $0.5 billion [18] Company Strategy and Development Direction - The company plans to launch arthroscopic MACI in 2024, which is expected to drive broader surgeon adoption and further growth acceleration [12][22] - NexoBrid is anticipated to become a standard of care in eschar removal, with a significant share of its $300 million addressable market in the U.S. [23] - The company aims to leverage its existing burn care commercial infrastructure to support the launch of NexoBrid with limited incremental investment [18] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong start to 2023, with MACI growth expected to be approximately 20% in Q1 compared to the previous year [21][30] - The company expects total revenue for 2023 to increase to approximately $180 million to $188 million, driven by continued growth in MACI and the launch of NexoBrid [19][30] - Management highlighted the potential for increased utilization among current MACI users with the introduction of arthroscopic delivery [13] Other Important Information - The company ended 2022 with approximately $140 million in cash and investments and no debt [7][29] - The anticipated capital investment for the new cell therapy manufacturing facility is projected to be in the range of $30 million to $40 million for 2023 [34] Q&A Session Summary Question: Concerns about Epicel guidance and NexoBrid expectations - Management acknowledged the volatility of Epicel revenue and indicated that the $24 million run rate is a reasonable starting point, with NexoBrid expected to help offset variability [37][40] Question: Clarification on MACI growth and sales force adequacy - Management confirmed that the sales force is currently sized appropriately but will reassess based on the potential for increased surgeon adoption with arthroscopic MACI [44][47] Question: Insights on NexoBrid's market strategy - Management stated that the launch strategy for NexoBrid will target both current Epicel users and high-volume burn centers, with a focus on gaining P&T committee approvals [60][61] Question: Update on the new manufacturing facility timeline - Management confirmed that the new facility is on track for completion by the end of 2024, with commercial production expected to begin in early 2026 [62]