Vericel (US:VCEL)2022-02-24 19:10Financial Data and Key Metrics Changes - Total revenue for 2021 increased by 26% to approximately $156 million, with adjusted EBITDA of nearly $30 million and operating cash flow of $29 million [8][21][26] - Fourth quarter total net revenue increased by 5% to $47.6 million compared to Q4 2020, with MACI revenue growing by 8% to $37.3 million and Epicel revenue remaining stable at $9.7 million [22][21][24] Business Line Data and Key Metrics Changes - MACI revenue for the full year grew by 18% to $111.6 million, while Epicel revenue grew by 51% to $41.5 million [21] - MACI quarterly growth achieved record revenue in Q4 despite COVID-19 impacts, with a sequential increase of 56% compared to Q3 2021 [9][22] - Epicel's growth was driven by over 30% growth in the number of biopsies and burns treated, with a significant increase in average grafts per patient [12][13] Market Data and Key Metrics Changes - The company expects total revenue in 2022 to increase to approximately $178 million to $189 million, with MACI revenue projected between $132 million to $141 million [14][28] - The addressable market for Epicel is estimated to be over $200 million, with expectations for continued penetration [13] Company Strategy and Development Direction - The company plans to resubmit the NexoBrid BLA by midyear 2022, aiming for a potential commercial launch in the U.S. in the first half of 2023 [18] - A new advanced cell therapy manufacturing facility is planned in the Boston area, expected to begin operations in 2025, to support growth for MACI and Epicel [19][82] Management's Comments on Operating Environment and Future Outlook - Management noted that while COVID-19 has impacted MACI implant growth, they expect to see improvements in patient flow and conversion rates throughout 2022 [15][16] - The company anticipates year-over-year quarterly growth rates for MACI to increase each quarter in 2022, with a compounded annual growth rate of over 20% expected to be maintained [17][28] Other Important Information - The company ended 2021 with approximately $129 million in cash and investments and no debt, demonstrating strong financial health [26] - Operating expenses for Q4 2021 were $29.9 million, an increase from $21.4 million in Q4 2020, primarily due to higher non-cash stock compensation expenses [25] Q&A Session Summary Question: How much of the MACI backlog is assumed in the guidance for this year? - Management indicated that the backlog is closer to $10 million and that a substantial part of this backlog is assumed in the higher end of the revenue guidance [36] Question: What are the pressures on costs due to inflation? - Management acknowledged rising labor costs and inflationary pressures but noted that many raw material costs are secured through long-term contracts [40][41] Question: How does the company plan to maintain contact with patients in the biopsy backlog? - The company has initiatives in place to maintain contact with surgeons and patients to ensure that biopsies do not go stale [46][48] Question: What are the expectations for the salesforce's productivity? - Management expects to return to previous productivity levels of around $2 million per rep as the market normalizes [79][85] Question: What is the growth outlook for Epicel in 2022? - Management anticipates low double-digit growth for Epicel, driven by adding more burn centers and increasing patient volume [70][71] Question: What are the timelines for the new manufacturing facility and pipeline growth? - The new facility is expected to support long-term growth for MACI and Epicel, with timelines for FDA discussions on new delivery systems planned for later in the year [18][86]