TELA - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon, ladies and gentlemen, and welcome to the TELA Bio First Quarter 2021 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to Hannah Jeffrey from Gilmartin Group.

Hannah Jeffrey

Thank you, Kathy, and good afternoon, everyone. Earlier today, TELA Bio released financial results for the first quarter of 2021. press available the website. the of copy release on is company's A

by of me Tony Nora fourth CFO.Tony quarter Nora call are today's will will financial an President the Joining analysis call first and provide Koblish, a on of and operational our highlights, and detailed CEO; begin performance. providing then overview our Brennan,

events to and limitation, product strategies, capital Before that environment, specific Tony. without may review SEC, We the that, company call, during from this differ we conference marketing include, events. and materially past in begin, potential, I'd sales company's Forms turn identify including, statements and future operating These make to the or like and may forward-looking projections future I'll results to encourage call the those the regarding product remind regarding the which now factors XX-Q, cause you the limitation, the or regulatory development, you to that with XX-K With performance. these actual resources statements described forward-looking will factors filings company statements. over without

Tony Koblish

Thank everyone. and good joining for today. Hana, Thanks you. us afternoon,

So start with million quarter. compared to in revenue of a to quarter $X.X XXXX. XX% first we year-over-year This for growth XXXX the growth a of X.X% off in represents of are sequential strong and the fourth

XXXX QX the end the at in of experienced call mentioned QX. of beginning in earnings COVID-XX we we headwinds our As March,

and number continued product throughout As QX.In in and and procedures best demand quarter, March, line infection quarter, in to month our rebound. hernia the decline, February continue OviTex it as in the our into improvement procedural we volumes COVID has rates a increased first an March to of began the for we realized see ever

OviTex experienced product our product As most of out OviTex XXXX, LPR the line. our growth seen throughout we have

continues from open been what history, have is a in that procedures basis. to time MIS surgical the migration major repair robotic to we alternative first our mesh. line by from procedures short-term. and on robotic of movement us hernia using been a minimally has quarterly with is open The open an reported the eclipsed sword bit position procedures This hernia develop a for to hernia and continued to a procedures provider. the invasive experiencing plastic solidify natural For OviTex solution This double-edged provide as in in our

While a does a size, prices selling pleased is robotic selling become in procedures LPR of as of OviTex traditional a use we difference most are OviTex The preference repair. performing function than open strictly has lower OviTex for currently have smaller surgeons a repairs, many hernia average hernia price. piece a robotic

as new being ASPs. However, and of our emerging. higher ability PRS surgeons OviTex understanding to new pattern to portfolio accounts, of down the how current more customers we surgery have noticing as of prefer This grow is product. continue accounts PRS new accounts, become revenue are adopt that sized evaluate trialing attention player.Turning for plastic a more and post our believe period.Based plastic approximately quarter lead Based the on to procedures, existing complex sales to with but robot believe many utilized reconstructive up OviTex who trend Many procedures. PRS the XXX% our using larger PRS year-over-year, evident of committing quarter, year-over-year are on that PRS our the are we should XXXX. use surgeon OviTex fourth during product which new in broad a we our surgeons customers, the Long-term, it for additional X of cadence how sequentially to X-month is our the to the product of well PRS plastic in expecting were been procedures, trialing ultimately the over our analysis to perform and performs to products this before our hernia we is major, demonstrates

the April adoption beginning and with with broad to strength in PRS May. We see are

As XXXX steadily new was we signing in the and robust harvest of we up reminder, access quarter in a of side, to make fourth the beyond.On believe which surgeons terms productive and QX will accounts, is commercial improving.

in and to regions difficult access and surgeons hours are our has still to their hospitals New manage, increased. overall, but office during cities

territories XX on current this increase target if to could continue we trend. target, this demand but by continues We mid-year,

accounts. are As we associated HealthTrust territories mentioned call, solid that we On hospitals. our on during fourth align front, sales HealthTrust progress quarter making we with adding that are conference adding

the being said, rate That done. program work there reengagement reiterate, quarter. improved. hit to our the for I HealthTrust be has still first During to is want new

Although product recede. are with hospitalization evaluations, We to COVID-XX signing implementation. beginning time as new open we traction good HealthTrust make it rates believe HealthTrust are accounts accounts, we more becoming to contract from to many takes most believe

making to of to over our call the financial Leader the surgeons for our turning first to performance Opinion Key and a Nora, Webinar like would our success. I investors quarter, Before participating review thank great

webinar. why The virtual informative situations. For use hosted speakers they how X this and Investor not turn go not to discussed very who could event, avoid in I invite the page for repair Nora. and who all the to I over view webinar polypropylene our those of they to will hernia attend, recording on surgeons the to was of certain section of Events we procedures With OviTex when website Relations mesh that, who attend the call and a did you corporate

Nora Brennan

also release to refer of quarter of Please financial our first increased for XX% first of summary to the will everyone. for XXXX update issued an on XXXX. $X.X million. financial for XXXX.Revenue earlier After financial year-over-year for quarter results, provide commenting hello our of I and our the results our today a the remainder press to Tony, Thanks, guidance

at XXXX. of February products more as was demand XXXX in so XXXX. operations cases of increase bad were XXXX the COVID-XX $X.X $X.X period This debt G&A million in Sales This $X.X expenses period. increase from to the compared XXXX higher $X.X hospitalizations compensation a personnel, R&D prior in $XXX,XXX XXXX. volatility in period first to the the line higher and higher due as quarter compared the in expenses million January. due quarter profit year XXXX.Gross lower the commission $X.X the expense. was quarter our $X.X million benefits. XXXX March development to the the $X.X experienced quarter Net XXXX in of million revenue were mainly and first same of a decrease and increased compared first in of to in higher million costs compared sales was for Loss travel increased in for loss to million compensation, the percentage quarter expense, for lessened same outlook by was compensation offset revenue While first first to significant due in XX% by and volatility $XX was representing year-over-year the increase This confirming the quarter compensation we marketing to first in over turning $XX.X we in of $XX and of in period with quarter in period XXXX. partially in million primarily same million $XX.X spend. offset in same cash in equivalents cash of the range compared compared and in the the XXXX guidance experience in benefits growth higher additional million cash XX% quarter first the the XXXX, million million of stock-based We first quarter, did of million to short-term million, $X.X benefits for cash, we equivalents growth, in was and $X.X to to revenue with and and to and XXXX. consulting the expenses ended investments in in were our prior year This are of period. to XX% and first XXXX.Now from

back Tony. continue projection. to could to will quarterly assess the pandemic call the current over dynamic on environment our environment will We that calls with uncertainty to impact COVID-XX and materially turn provide continued I updates that, the With relating as the

Tony Koblish

Thank you, Nora.

many have everyone I and our who thank want TELA Directors, yet your dedication Nora filed appreciate with not through to afternoon, new the leadership tenure pursue Bio's read strong a we including we best through X-K her all wish at has decided Board Nora, during TELA her of her Nora direction. you really Bio company, offering. of and the contributions IPO future for behalf and endeavors. your those follow-on For the this On in

for questions. up it you. open Thank let's Kathy, that, with Now

Operator

first question is O'Brien Instructions] Your from Sandler. from Piper [Operator Matt

Unidentified Analyst

is this on Karin for Hi, Matt.

see was resurgences, coverage trends, well. are newer And any just with some of bit some QX not on know on but more from I and stronger you still starting May guidance, I recent to said doing pressures also, April first, COVID? you quarterly that add actually providing start accounts Can you're were some little color a to that and contribute. you seeing those trying So

Tony Koblish

Yes, thanks for just into from to I'm to I'm bit today. want start some the of I -- to where go going going we of sort going through question. color, not habit that to QX historical right. that so get are don't but fall I'm I'm through numbers, a you to going into give to month-by-month

So came XX% QX March. when and you sales QX, February almost in in look at of

that, right. month we a was expected tough January So really it and

end a to through well So April May. and QX, of and QX exceptionally it but really that on fairly tough on and that continued of in expected for and was has our concentrated last said earnings March us start based call, snapback February the I the good, January, we into start was

a accounts, work lot of think is stronger starting where pay to off. situation of COVID at a we're I stockpiled we've the heck all get a We've during done So to new looking right. of that

XX of look to accounts, XXXX, the of QX QX QX you XX of from piling had at If XXXX accounts back in we XX and new stock in new XXXX.

these of but about the very of ability a We're contributing. growing. good so to they're yet it's all we're April, that keep happen March, accounts start heck to step and stockpile to seeing May, start started a bullish contributing up our business going Now haven't and

at we we're where all to -- to that point elements parts in that see starting place work. going So and now moving just we start I to the we're think put

Unidentified Analyst

from on And Tela to just that, that too seeing on you, more can that's speak clinician early translate X thank still from and conversion just starting me or it helpful. then to LIVE, is to bit is super Great, you're a little the top-line tell? you

Tony Koblish

new all mean that account work just mentioned. I I that Well,

way LIVE, of able that the to You And other strengthen, work peak do at there on in to basically brought point. XX most that its and reps other XXXX no was at than were Tela LIVE. Tela due COVID they mean, was that is happened We that new right. to

and around been of haven't had So reps, little on these and long a $X situation million. bit doing longer. that very XX% of on the anywhere are run rate a than our that ones running established the and basis then about we XX% little higher They're XXX roughly around of our are a had also XX% XXXX an that where revenue, between came reps or more in $X annualized million we are

both more that of open QX benefiting Tela just so the we've that and LIVE are in program, through for groups especially only from much those we And mean of launch those, PRS or products, fully. been right. had, for reps plastic very surgery more I mechanism really our aggressively that -- it's

see we're materialize. so start starting into quarters to up of only couple that And to a step

We've by driven the put detailed been been metrics. LIVE has the comes Tela that those really of that about out has program. of XXX that Tela LIVE and by surgeons as excellent of all productivity all through So

Operator

Anthony Jefferies. question of next from Petrone Your is

Anthony Petrone

good Nora, luck Congratulations, on the and transition.

Nora Brennan

you. Thank

Anthony Petrone

And as through GPO how and place, additional But how will couple there next, a. new many on-boarded? year that in have go year, contracting, want just boarding existing are we year of contracting, currently perhaps GPO contracts should of GPO that be additional As terms we continue out look And sort on this this to follow-up questions. out we about look are in through GPO could GPOs the that we and transition to play of through how revisit at of the GPOs? as I thinking of be a into outward facilities then contracts,

Tony Koblish

in right. X Anthony. we're Yes, HealthTrust in we're mode, mode health, in and we're IDN now, We're implementation right in modes so

are to The the contracts going is The other request participation further GPO think et future. for out. cetera come in I big

heated the up of struggle and So here IDNs. couple everything COVID. because has literally of COVID a been HealthTrust has for a bit focused stopped that a and and year down. been as times really some the doing last is we've on year then They started of HealthTrust have of cooled

that, think getting I right. we're through

beds the a numbers, throws what our is think about to I right. COVID's exceed we situation with I now whole worrying the chain matter to COVID of as impact look We're look all we're ICU anymore. no as hotspots we're you much grow, And -- think a have to last not the and the stuff. team, job find I does where and that to is the the on told mode think affecting in at new supply business, done at filling and up us, that our is at phase their what way. COVID willingness a our I

and And just get so that we're think better. better starting I see to

HealthTrust ability of with of accounts, limited all total So about even in on, to right. dialogs, pretty have the running, that's drive and come QX XX% unit are our from going sale with those a that stuff we

look you and a X pretty situation, are there and right, growing different mix XX% right, right, Anthony. growing, of associated IDN IDNs contain top our X they nicely, at of are to with, they're our GPO top If XX% IDNs X our that

So GPO. X IDNs, maybe they up more to to tend roll X than these or

is at excellent into the the I resource group the year. when as us an yet, of these knocking which turf for, we we're as up work help not having long geography I HealthTrust have have They're think success plenty, set comes IDNs to but contract in we and we're there to to know accounts, open level, plenty and excellent the going So Vizient IDN and play. Premier think with, down

So that's it's X. looking IDNs, the HealthTrust it's X, at way right, it, and we're

Anthony Petrone

BRAVO helpful. couple for on rates XXX safety there, in X being hop back I'll A data quick again, recurrence ongoing BRAVO data, That's of low of out study, hernia and patient latest follow-ups queue here. data. the round the record

target from you is is clean want just guess just the commentary. Did end being sort those by so, would resonating? BRAVO of in you it for reps up the be headcount Just getting, then X, course, wondering the me, cadence of XX is progresses? reps the marketplace? the data year adding year, I are the as -- the last I of Tony, And What how see that and received feedback of to if what this

Tony Koblish

Yes, let so the first. me second I'll yes, -- take piece

So it's interesting.

right. I think our little thinking a is bit, evolving

and commercial our think going combination start to a things talk of we're think I about So in to organization, right.

the don't be so, know, is Dev or count, to were I running think right, right, somewhere those us. We about going reps X specialists, XX, important this missiles, almost now, development right. specialists. it's first running We're for The and emerging I about XX rep the quite right Clin group, to or then X of the clinical be

we're Now be X. to we did add going put staffed out, up, about offers

side to we to trade They important see us. more for a there trading the little growth geographies, So big where Zoom, development we PRS can clinical may bit, clinical Clin reps up right, and a there, these may as the have wind are specialists of can may planes. can bit into a little be super to they specialists in on the way productivity starting reps be a between Dev development claim there that cover leverage get use specialists. success with we're on they And

We have they're needed. country them whole the working where

-- our the X little on when yes, be is so side. XX Dev out, thinking to side, there to Clin think or I plus or sales want not we're force about build the a XX reps, I X be may refinement, less rep But much of it in little plus on get model. bit it a XX may So think we

may is be, be to the total similar. number the So going ratio

going we're shy, we're The wait think think come and going is at of until going don't with I see QX Anthony, feeling exit out we're of mid-year, of out to QX. the then persisting, QX start. We're we are And I we great how where be to strength coming which the terrific. is right. to about

I think through a go of down we we do. I reps the feel don't right We if rest on X thing going or right. are as We're the few for put the the end the we that yet, can number we're by surprised XX specialists, year. going hire I but now, exact to if an year. clinical invest, to at wouldn't I say, XX, the to of you more have ground be development it's might we're

So it's going be some to combo.

Operator

Your next question Turkaly Dave is from JMP Securities. from

Dave Turkaly

mesh updated the XX% you you release litigation the your be a Tony, I just you go. new kind to said prefer anything curious Nora, survey, event, see your on KOL just mentioned had of in the highlighting of press I'm sort will get X sad docs we've there. customers to of of would option done OviTex. that in tailwind like the year? Did that's or thoughts occur synthetic for

Tony Koblish

the Yes, did COVID. backlog and information. litigation sadly I new mean, to I have stubbornly, the install due

data to products and all plastic polypropylene looked the last I'll repair or repair, it's synthetics have of the cut and types we at progress have shifting, too contacts worked data that that to we already, survey it's been start made, as up. us it's the XX% feeling we're talk that what products. ours, slowly did with different of such say at down about right. is And mean usage Our you, survey, for but of IQVIA NICE, I mesh I that team biologics, we of indicated straight market what feel sources be the but of look whether not as or had is, all are seems when told surgeons, really has DRG much up our to natural we what resorbable surveys sort natural

interest the wider the in plastic up look. polypropylene. beginning So better we're at very increasing straight probably looks It natural like repair about at is that of forget versus an least in market surveys, data data,

eye So being DRG look being forward, today. it's It that driven phenomenon going by driven to and we're such right. and takes it's that data tell but to publicity keep story will that the make and raw for mistake, the by I just no patient, numbers, going an exists IQVIA this while at on kick think in, the as a

continue right. take, a also it and our eye going our to on that's to in We're we're business, should improve. seeing trend it So keep

less all Our product and broad a right. LPR great units our hernia robot product or in, having that for stuff that is range, XX% cranking sign either that's through and of line us the that's is went laparoscopically, a complex

Our goal to very robot. be the is compatible with

Our goal is in product, any any a able any be hernia with to repair solution. anywhere, replace to procedure natural in

And look so happening. you LPR with slowly landscape, if I the the eye an you on internal look We'll at at of across Dave. it, and it's sort our that happening, XX% keep and XX%, it's trends mesh think

Dave Turkaly

was just weird And follow-up, quarter second know, that. maybe reiterated a appreciate I almost we it was second strong, guidance for for maybe got we this has comp year. then last and what COVID quarter get from I the quick quarter Nora. had the

as even half sort towards you so knowing back MIS trends Do and that could than it robotic. had there's think back chance the hoping a of the in conservative, of do COVID on, half better that think non-event, you and I seeing you're looking the somewhat -- year? you that we're So the a is even given your

Nora Brennan

the until this clarity point. better certainly at the I to at respect where but we hospitals this it think think COVID, we're that Again, do to chain supply and now. conservative we we at is at with Dave, we're get be and level stay going could better, to

Tony Koblish

I wood We'll then. of QX, -- end we'll and there's chop agree. value see the lot now think Yes, between I to at in of think I reevaluate yes, well, the a

We And whole So couple that. so never is it's just BRAVO the we're not we're out at Anthony, end out the for the question, going going a a waiting highly Yes, And have put as everything the realize, to I interim. years. into Until excellent, data say is answered we'll to power. by in I back. the have think I differentiating, on an that there to of words data We've X of full put ourselves of just setting I'm two year, hear and X-year success. years, up journal this the BRAVO it's right. thing

the be through and now get really we flash the everywhere, that to we'll data and that BRAVO the do we'll good, So data published, able X-year to thoroughly once we're expect finish really, thing right we same then looks very data, once it off X-year strong. but

a robotics, redo some other there. we're which starting phase on is, but very, is to and the very of start-up COVID to patients close good be And that study, we're enroll BRAVO X, news through going finally, focused IRB to

with well we're is all year platform. quite that hernia So X out and study our full commitment data to pleased that robotic we're our with demonstrating round to going further then things clinical just robotic

Operator

And Kyle your final of from Rose Canaccord. question is

Kyle Rose

miss we'll because, Tony been percent LPR through the talked about in in big picture guess start congrats, the robotics. kind Nora, Yes, but lot's a want asked, of you. going you I to question, last

the So you your developing and market, the LPR. the backlog, seeing a is are what and I procedures the shift we in think the more using Obviously guess procedures? there towards like the backlog talking so business, you're clinical simple see your partners a the in question of hospital about delayed there, a MIS, about your if X-part talk is, that

some I'm normalization the year, more of of we are back flow in a of going see trying to type LPR bigger, come So procedures see and just this understand, the complex then half wall more to these procedures. ab add-on of we consistent robotic the if

back towards mix half, what like the trying some to into price. acceleration second on purely imply Just revenue because that maybe would that the half understand might shift

Tony Koblish

interesting Yes, a that's very very, question.

But out it. going to to is that can were and we We're and we're broad, the have we anti-plastic products new to few launched put natural in wanted way wanted right. We anything not, could hernia, we do to a more So trying there that accomplish and it -- with I or platform, first we next do over back the well, right, help start. capability, initial and breadth why that's the as which ventral, is going are totality to wants years good. where we BRAVO our was the we are point complex accelerate the these moderate ab to in to that wanted starting of to our wanted this, I continue that by wall describe prove we've and think procedures. have hernia to difficult, going range of difficult And words to whatever do repair horrendous, we this ourselves start, we look go contaminated, and complicated, when that. to I'll and large, believe what to think done that's be

very, in a value other very compared have really X to that We superb backs BRAVO proposition product. those any procedures really up.

we that then is not in leverage the I'm going to with should could that's at that's X the the the as to implant if more complete, all product experience start If of step and was easy product. and reps handle step procedures performance goodness to going So set away plastic, it's able handle motion, to those access we repair in we and and But from have to it's to up everything, plan alternative. and to simpler natural contracting be more always beginning make more procedures that to been X say and our the more of grow. chip always could and because

out right, been need we robot, can. that and can we out product, have And to that LPR or keep plastic, learning, in X we're the do as with because natural one buffing of very product easy to And but a for that it to starting has to what figuring we portfolio or the we're early do biologic the simple There's so earmarked see repair catalyst else happen. more sure. that use sizes, for this we're X no the be to and for sizes, we a need stages

the we're on So in to that moderate driven the and the of data be in the breadth, first sort product in additions inning third the robot. robot inning it's all -- focus of simple developing complex. we're third on the to fourth to going through We're or and by by and the on pulled the maybe

beginning, So plan yes, working, The we right. I happening. operating was mean that's plan the we're X-step a it's it and against what see from

pretty good we're we yes, So that. feeling with about are where

is Kyle, that help really other factor, interesting PRS going is The hernia. I that, to think

we were release, HealthTrust, about with until like, QX, when talk we talk to hernia first, exists. these no, get exactly learning, the we're we're of let's cost massive they savings to about last meet And limited they eventually. IDNs, where GPOs, first, QX want even start, PRS where to that in isn't right, So we'll that's wanted right. year Up PRS

should now, saying, hernia in PRS, about that the it with all talk you're so shelf going We're to We'll and PRS, interested let's the if help So get to, moving. it's opposite. that's have right, lead get and synergistically. let's that work we on us

just each to We start in haven't the savings and cost even seen product well of waiting of start to value terms going yet, that right, of relative to line, down kick a in happen as but proposition. I lines think our that's

Operator

Tony closing will no back are over for questions. remarks. I the further there now And call to turn

Tony Koblish

you, thank All everyone, right, thank you Kathy jumping and for on.

COVID last numbers. quarter. that the remainings, to and to I think going hope we're of supply so chains and the believe focusing The start that going us. experiencing this but that's opening sales beating are improving into get We quarter do continues, nothing on seeing with just our that let's we're trend, help are up, just and meeting we last So start bleeding on

improving and of optimistic tuned. we're advantage these in for So all take the interest the believe, positioned to Best detailed company you. I of and we're Thank trends stay here that well come. thanks your to as future. about still We is

Operator

conference this call. gentlemen, concludes today's and Ladies

now disconnect. may You

TELA Bio (TELA) 14 May 212021 Q1 Earnings call transcript