UTRS - Earnings call transcript Q2 2022

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Operator

Good day and thank you for standing by. Welcome to the Minerva Surgical Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. now today, hand Relations. Caroline would to conference I speaker your Corner, Instructions] like the to over [Operator with Investor go ahead. Please

Caroline Corner

call. Thank quarter to Welcome earnings you, Minerva's operator. XXXX second

performance, and today, impact Minerva's the Clapper, me Litigation position and considered of expectations demands President Joel These historical performance, Joining results. forward-looking for filed obligation expenses that expectations of variants and during these involve Any Reform to June customers' the to call that do Chief August this relate neither for and today. fact circumstances SEC SEC, This for on and and which available second factors additional within Act statements forward-looking Officer. the XXXX, XXXX. are operations. will from XX-Q details unknown outlook Financial should release, and call, required call the the includes Minerva of XXXX, quarterly could the the in is statements. XXXX review in fiscal events expressed trends the Investors recent differ section future the Minerva's operates, on under statements also Minerva's are today's performance are be will products including meaning made the on particularly on based Jung, A management's Minerva risk this X:XX to on Minerva's and review. Executive technology, markets law. for to to and the no filings, market of today. or any Officer; quarter Minerva's on Chief year statements, XX, I of provided latest and to Dave. that, nor with provide results, that or as actual or materially Minerva's statements call of be Minerva's XXXX, COVID-XX and information. by Minerva's available has by exist will results, reflect on risks applicable the call ended on forward-looking p.m. filings over Minerva's update statements website, which or its not financial uncertainties press you most that in today's regarding was undertakes promises operations All X, Form results, Pacific products, occur including Dave for website Private as for statements Surgical matters and report expected additional which described With Please forward-looking are hand Securities trends Minerva's quarter call by achievements achievements performance guarantees known projections implied Time financial and encouraged cause the Minerva's website Minerva's statements www.minervasurgical.com except recording about for and

Dave Clapper

Thank uterine you, Surgical our us on second for quarter women's Caroline. on health. Minerva And thanks to call. solely joining focused all is of earnings you

lining line of line uterine has the resection ablation is ES, of by either products or for polyps. by abnormal Minerva fibroids the of a and structures or intrauterine bleeding of products: and fibroids Symphion, HTA either dysfunctional four called AUB. and polyps. Genesys or AUB abnormal the a of Resectr Our the complete endometrium caused uterus called the Minerva tissue address endometrium

women in I've women, U.S. three XX. XX As equates the XX and calls, between the on previous one in ages million which mentioned to of AUB affects

leading of Importantly, hysterectomies. AUB is the cause

hysterectomies. cases, surgery. U.S. procedure surgical that the in to up XXX,XXX four- C-sections, hysterectomy in to performed the year. the mortality a rate Next per women's and to highest anesthesia overnight major In to is requires and six-week volume the of directly each X,XXX attributed time approximately stay hysterectomies general underappreciated hospital, is It is surgery it with a X.X hysterectomy most recovery patients often a

at to for the AUB. is Our hysterectomies Minerva performed unnecessary eliminate mission

endometrial FDA is ablates with The the in menstrual significantly for received product, uterine XXXX the flagship whom ES Our premarket or heavy abnormal ablation ES Minerva complete. and system, bleeding endometrium Minerva bleeding. indicated is childbearing approval eliminate July to reduce for women of

providing HTA a instrument the system uterine irregular-shaped with energy performs Genesys to for ES, similar but the an hot the suited source better for saline is that Our procedure uses Minerva as gynecologist anatomies. ablation, the

are finally, resecting fibroids are uterine out Resectr and Symphion significant excessive is settings system of generally portfolio of pain hysterectomies. and resection leading removal used polyp Our Fibroids And office addresses a of products. in is cause and tissue for round bleeding our another indicated polyps. and cause to

Now let's period for XXXX. of $XX the quarter million reported the in XXXX, second in the turn quarter and revenues in of to versus second the $XX.X $XX.X XXXX same quarter. We first in million million our of performance

Symphion that to disappointed challenges experienced to were and ablation we positive are hospital sales. elective out While shortages in decline, are have seek with very revenue we from recent markets the trends we encouraged reticence lingering patient due impacts treatments. The by nursing COVID, year-over-year access, believe

markets However, from are are indications that low points. the returning their tissue resection

system Symphion growth over last XX% saw year's quarter. a Our second

macro make improves, well positioned growth. continue this to continue account We and trials, evaluations believe new we with that the to and environment progress as are

XX% as who as the with product end on the light We XXX market. In the underscores know added accounts. seeing accounts is fact, both hospital Symphion months, XX on that during are Minerva this patients believe limiting Symphion. and tunnel, sales were accounts, of past lingering new approximately the the best seeking we spite challenges with seeing impact of In particularly new which we but COVID data continued we the the ES staffing treatment of are of are well force new overall, and the have access, at we progress

rate normal the This a FDA-approved our success of bleeding in less competitor's from efficacy And FDA-approved trials double same our bleeding to excessive NovaSure XX.X%. woman's our or product a rate, XX% was NovaSure FDA i.e., treatment. biggest menstrual come for was woman's FDA from that bleeding, approval, for is showed product to elimination that clinical rate, Minerva XX%. Our trial treatment the conducted clinical biggest a approval, which results, level, competitor's success complete reducing menstrual the of which XX%, zero rate which treatment amenorrhea only our is compares

Finally, the of and of the ES rate the the OPC, We generated by the data. will efficacy previously their the five ES practice they X%, three-year in choose over uncolored significantly than read are when trial ablation the devices, facts, clinical objective competitor's performance FDA competitors' compelling our device rate best to biggest to that NovaSure select to hysterectomy claims our when during approved FDA-approved websites, In doctors the the compared three-year of physicians for our hysterectomies period same summary, labeling endometrial experienced believe statistically less are for or period group X.X%. criteria that ablation to was the of Minerva our and major given compared And follow-up results patients endometrial these supplied statistics Minerva efficacy. greater marketing to treatment.

corporate complaint to lay given their and years on menstrual and ensure the we we bleeding "for done today Hologic is and corporate of stopped website rate correct NovaSure XX.X% thousands physicians they a Several recall ask with to complaint women, dramatically success was modules formal immediately providers of their of claims the physician efficacy FDA correct the which treatment the the the NovaSure to U.S. require care that are XX% the misleading competitor more have Let's facts altogether." U.S. The health websites inflates saying, false ago, by and accurate or Following what on across information. our physicians Hologic reduced changed websites, sent images website women lodged and FDA, officially all the efficacy claim, appears reflect out still and the to on data. that FDA-approved our the replace to

However, continue corporate claims, to this to websites day inflated erroneously which approved the promote efficacy their not U.S. FDA. by were ex

Hologic's claims misleading www.novasure.ca. the fact, NovaSure website still XX% appear at on Canadian In efficacy

misleading test diagnostic medical the as United misleading accurate requested Hologic satisfactory to and of this have post-treatment FDA provide efficacy their ablation the providers claim that no treatments, Additionally, correct to U.S. but efficacy to action their far marketing displayed to resulting physicians States the the patients websites, were health care is in still takes companies there on to they on display and basis these and the of we seen to doctors today, not and Again, thousands on same claims, misleading and steps data their information. to evaluate with standard. date, physicians them rely to Today's are these Because patients so has is gold across website decisions. the using sent treatment NovaSure as the women the device full NovaSure that gone claims. from even relying for endometrial protect data have

tissue were full beginning and are with ability exceeds suite well growth, to product, having this are market share on market. products resection successfully to believe sales. our we our quarter, in Sales XX% indicating safety a Symphion this of We spot unique over over of and The features compete taking results. of increased market rate to QX growing Moving QX XXXX show XX% past a Symphion. important XXXX this bright product to and

dedicated sales hiring are force. training We and our actively women's health

sales of for to to four metropolitan of and covering takes comprised areas. now organizations encouraged to full the enthusiasm major to territories, three months delivery new our to a and is our purchasing force a sales through sales With continue contracts. are group representative products, field we network Our by gain XX independent team. up progress we and access get sales speed, six of It slate most

IDNs. signs treating business seeking treatment under on Minerva the four, in like our our their treatments. leveraging the progressing of select with Minerva products of which, drive Again, I'd ablation Symphion of with team; GPOs our expansion increase growth completing contract; controllers existing both in remind and you five, three, Symphion awareness base contracts cross-selling established DTC Minerva in treatment to drivers: contract. very are we products. and encouraging, to DTC physicians. mentioned in overall I our installed well and now our are new increasing line digital under options marketing established and initiative, And business website to marketing With product XX of account efforts markets. new are connecting current accounts; With of of and options last patients business sales our two, awareness we underway success clinically is quarter, is early approaching complete on our is our advantages direct-to-consumer almost accounts; consumer Initial traffic signing new for our one, as increasing XX% our We today, of in as accounts our educate turn I'd and AUB to now XX% that, showing of proven strategy. to as marketing patients like of to business AUB pilot, national

a have are over things unnecessary to women of for work but mission with excited us, we hysterectomies. I'll treat With very lot to deliver results. that, to of ahead financial hand on and eliminate Joel? Joel our We AUB our

Joel Jung

of for good the but or to first in quarter quarter of versus revenue million of revenue the an quarter the of of total million million XX% Symphion HTA was in quarter. the or million versus total Dave, in XX% XXXX. We're or Total XXXX second or X.X% second second million, Thanks, of was of $X was At Genesys $X.X afternoon, see XXXX $X.X level, quarter $X.X revenue the for product or increase quarter quarter the of quarter XXXX, XXXX decline or of $XX XX% XX% over in revenue and in $X.X the of a $X.X from Symphion total in XXXX. second revenue of versus the of second everyone. encouraged XXXX. million second quarter total XX% the second of total growth $X.X ES million quarter, XXXX. revenue million total of of And second the Minerva revenue the the XX% was of of sales

Symphion on depreciation in which quarter additional from life and the is ES by the in XXXX. Total cost-reduction historically projected of impacted second by gross impact gross sold and of million trends which competitor. reduced XXXX. over margin both controller which negatively half years initiatives $XX.X over with quarter recently expenses the Minerva was HTA and ablation the handsets utilization of increased favorable coming impacted from single-use XXXX of controllers mix recently quarter in second positively XXXX However, increased on Gross predict also increase shipped, instrument. volume ES as the first a product over second expense of period, XXXX, first products, placed following second by time, were We've more was on single-use with then We products the with costs of of offset seen a was with quarter XX.X%, customer future operating $XX.X reported sum, In second utilization three-year margin were shift Minerva sales recognized of of but and of sales as a contract the our over the Minerva XXXX end-user handsets. during a spread overall through that being the increase quarter manufacturers. market in by the of improvement an product in and has today single-use of reported customers, XXXX. HTA general well future an the lower the placed Genesys controllers margin the XX.X% for sale by margin placed but overhead challenging in and being pricing to handsets XXXX ES the has a ablation quarters substantially Genesys margin versus Gross margin. gross of of customers up below our were fixed million of pursued Symphion, quarter the Gross adjustments in increase our we volume controllers

offset Scientific from estimated XXXX. increased earned by sales the liability final due revenue and $X.X sales spending acquisition-related May Boston expansion tied fair to Boston million acquired for milestone is Scientific the the increased of were in outreach, potential the products and value due This XXXX. force the the revenue payment payment nonrecurring in patient in expenses and Our in of marketing from net a early XXXX to physician in to and reduction the

year public in operating as we million increased versus were a where administrative private result and were depreciation still of the amortization of second operating a included general company and expenses a prior now the Additionally, expenses cost as Noncash company. expenses quarter, XXXX. approximately XXXX, stock-based $X.X in quarter expenses, of in million were the $X.X second second compensation total quarter of from million costs, included unchanged of operating XXXX. of quarter XXXX, the Noncash second in second $X.X versus in the the quarter

basis, $X.X versus $XX.X second XXXX. for quarter loss XXXX XXXX the of $X.X non-GAAP a a of EBITDA second million net in EBITDA in XXXX. in quarter a we net EBITDA adjusted reported $X.X quarter loss of the was of million On in reported Our the for negative million of adjusted million negative quarter adjusted the second versus second

the we and in intangibles acquisition noncash a Resectr the stock-based the in XXXX outflow quarter the unrestricted XXXX cash. quarter the as of finished costs we the significant amortization compensation the total, balance in significant as positive cash XXXX, was a noncash assets, of expenses perspective, quarter final Scientific. $XX.X for fair Symphion revenue with reminder, of our second value related May million. have As due In reduction well payment of the of From for from second $X.X a adjustment to sheet Boston milestone Genesys million HTA, to

how our when XXXX, current revenues. rolls us third unchanged on grow liabilities return into quarter into reminder, million the previous three-year operations debt interest-only more We And of depending facility refinancing long-term is were following amortization cash long-term we of Our as through after fourth to last normalized our the XXXX, facility. a IPO well schedule. XXXX, $XX a of substantially our from debt quickly which it customers will our quarter believe our position and and long-term on

guidance. Moving to

COVID which of half the disruption ablation first especially from XXXX, in We significant portion during the experience a to a markets, of represent our revenue. amount continue endometrial fair of total

experiencing saw increase reported from the our that While are was first revenue this ablation total we similar competitor in market month. the QX we quarter, by revenue primary impact a earlier

our in market offset enough growth, good sales basis. decline as we and to year-over-year a these on continues are ablation perceive expand, sales sales a what not we to are showing Symphion believe While product share temporary

between the XXXX and to I'll call our operator for the answers. you modifying guidance year $XX With thank previous We full your million and back for are questions and that, revenue thus attention, say million. turn to $XX I'll

Operator

from have of Please [Operator ahead. a go J. We Robert Marcus question Instructions] line JPMorgan. the with

Rohin Patel

actually on is versus the for Rohin Symphion dive procedures for This want into a more. Robbie. little I to demand dynamics ablation bit

from it's And resection? understand for an as that COVID, can there why necessarily patients during elective. I Specifically, they endometrial more work go home procedures given are resection, than painful. more be challenged and and better with severe tend to the cases significantly logic still ablation manage in procedure more symptoms ablation wouldn't tissue the

this So in I now? Or even is that have I that's follow-up. understand then at still not at though a nature? the dynamic, there people COVID but another is dynamic case keeping home is place structural largely And more

Dave Clapper

Clapper. you Rohin, this is get Dave it. Yes,

like symptoms sound are this women, abnormal when in. as an managed alone that percentage very office are still from of mentioned, bleeding, working home And if very, yes, you're is women down. You still easier the working that that while of they pain they're job you're when just much working whatever you is question not at But answer I me uterine high. those are or bleeding in in when you're than and home,

with doctors topic. that's we're this feedback So nurses on that and the work that the getting them from

that's we know. So all

Rohin Patel

in to well also off of seems kind of was that, headwind kind called kind then like of it a And out volumes. as the guess, procedure as of, I staffing going quarter

of that dynamics subsided, you has Now more are you just seeing hospitals things mix saw general staffing sequentially? improving become the with between terms do Or in staffing what of see pressured? that's you kind significant? Omicron being COVID the just So that, then and

Dave Clapper

about it's think even. I

this -- think David is I again.

even. from on. their when think people financially, as as traveling And hospitals of many much. individual has traveling I do laid in two into mind off nursing it's as it is traveling, to much What happened technicians of get long and traveling to were hospital ago, laid is situation And day. improving not became off driving don't feedback than they're the our we -- year staff, accounts, working about And hundreds hundreds that health admit, difficult they and nurses, financially or a way, providers, staffing do the and large the hospitals is keep OR these every these they nurses work bringing as care better called. they them a very very, for at so

City now to challenge these back across the is traveling an before of the they staff they hear get we So are Phoenix, drivable hospitals St. getting pay, for that. and traveling get amazing L.A. because their the with which literally driving plus very to They're not Louis, that's New these sort go town. traveling. nursing pretty many increase back previous York a these to hospital And to area. getting along at nurses, working come their making them, the if to many to -- they're from airplane work distance of became And they're wants or stipend in case, a employer of a of to in literally them none are housing of on

Operator

next Matthew O'Brien [Operator comes question from Sandler. with Piper Please go Instructions] ahead. Our

Matthew O'Brien

of I'm a upfront sure reduction It outlook last on but now. dynamic of seems for to like Minerva, commentary the HTA little that the as maybe majority right especially there's to category. a on on a the had the in about year Just Dave. competitive up question, lot you well, is follow the

significant Minerva the enough? reduction that it's just the the technology because in, like that in how on but side? about seems dynamics, environment the do year enough the think it given So for going is we the forward? it And going differentiated class, then of economic we're take majority forward given to the best it Is competitive is share

Dave Clapper

we at fed misleading still the So be we being our taking largest but same we customers taking share, weren't rate competitor. would information that believe not it that our if by are

XX%," "NovaSure, health totally results care You of NovaSure of from -- that are eliminated. received Internet can websites you'll groups, search for are XX% hospitals centers, thousands of that has ambulatory simple physician do get the a that providers, reduced or treatment, dramatically patients search and their thousands advertising the bleeding a surgery for results, for GYN

It's you're say, working success not they're So is this the XX% with get the to that's I rate and a situation and bleeding until you patiently having XX%, chance saying patient, been could we're why you have read now FDA a of my have eliminated." wrong, saying just just that to if this fixed. up "Wow, menstrual they're up that totally

say, success for one doctors. Minerva, endometrial the you're following website and patients it's bleeding we as facts year with really say, the or they for -- Minerva approved my that XX% say, high "Well, why is And it's with NovaSure old, FDA we about the to on to XX% should the as it's know as less XX test how least where bleeding many the no, they results XX.X% the lastly, give heard the it versus on why ablation NovaSure. endometrial advertising FDA rate device, And diagnostic take better So product rate, all is are the hysterectomy those think companies try to for not follow-up according rate, do evaluates years." rate post-treatment no talking honestly far And women's we'll on than I've then the And is technology, years I pressing And the for approved product. for to that the in that's rate. NovaSure." three a here. because X.X% important say, for ablation, as success efficacy at XX% try being physician, at say, least vitally twice you I if zero there use And XX addition "So that." action FDA-approved FDA and been procedure. bleeding amenorrhea is older than and I've And and zero they this Minerva rate to new "Well, do have Minerva. "Well, at And fastest Minerva years rate, So occasions, should it?" at reasons, we that?" you much following I X%, or And "Well, use to amenorrhea

long the answer. about Sorry

Matthew O'Brien

that. have anything meeting Is there a like set Dave. Joel, where or I from on going appreciate on I for terms And to do this a an review going No, of else just point, but that perspective follow-up quickly they're advertising in space? that what's

Dave Clapper

of at to FDA, respect friends Out for any that. I'm not like going out anything on details the give our meetings or or schedules

should I resolved. are in think we FDA keep the But get that to with actively discussions we confidential. trying this

I that think to me to providers. health and company a it's to continue appalling would represent care patients

modules thousands actually website Hologic So with information. misleading to the care health of this distributed providers,

get So although mentioned preceding haven't States, thing international Hologic websites. in United we their for do those. their for have they as yet they results. I if for of website search And changed provided all still websites, it's And -- these change XX%, all to they you'll company the said, changed one memory of the like information that and cards and not thousands a NovaSure so to

Matthew O'Brien

Joel. question quick a then And Okay. for

of you just the the back about this half. that position going rate forward? the Just in up back Joel, in burn think grew that's how year? to talk we the then half But rate capitalization here come of And hopefully, of the it, can the QX, QX about Company down, exiting you the know and cash likely the going I burn in mentioned Company sales

Joel Jung

sure. Sure,

and part rise fourth when the particularly in the and in a come year about year. first often we quarter burn the historically patients our more half their past, down seen copays the consuming of of sales. the treatments And does in -- of in in function all rate the of largely deductibles have we've talked the a second in seeking So

So the come burn down. does

when cash are additional right looking considering now capital. and We some closely and pretty how to raise at position our

So this and reserve potential that thinking we're how discussions little point funders bit about more. in at a cash some to build with

Operator

this conference and now Thank at does call. time, may And any I'm today's you questions further participating, this not for conclude disconnect. seeing you

Minerva Surgical (UTRS) 13 Aug 222022 Q2 Earnings call transcript