TMCI - Earnings call transcript Q2 2022 | Treace Medical Concepts, Inc.

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Operator

Good afternoon, and welcome. Thank you for standing by. Welcome to the Treace Medical Concepts Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. that is note recorded. Please Instructions] today's being conference [Operator conference to your I like the over would now Cervantes. hand to Vivian speaker today, go Please Vivian. ahead,

Vivian Cervantes

our Hair, Conference Kathy. and John company Treace, you, afternoon, Officer, second Officer. be to quarter and Executive Mark Thank today will XXXX Financial Participating Call. Good Earnings Chief from Chief the welcome everyone,

the The which results on review found our our and will the session. of During released the question-and-answer commercial after our call, at after in we will Investor Relations archived being press call recorded activity be section market close This Investors website. a host website of our the in quarter we release can offer the will and financial today, be section investors.treace.com. commentary is of first

I Please statements March later would filed now XXXX. statements first market Before trends, during statements obligation our as should refer statements. current statements turn statements. forward-looking call results quarter to are differ forward-looking Form filings, from the material Private those to Reform upon we that of forward-looking predictions the XX-K to that Securities be under remind to made you intent our XXXX, future it presentation protected With reliance a statements. and over anticipated Any These the assumes we are our or today these are Litigation detailed like that on for various of full uncertainties Accordingly, begin, SEC relate that, John? risks. and is forward-looking and could cause Form year of expectations undue for and our to John. or our that results not events as all on risks to statements based be will estimates or for performance, upon the filed this All or All these XXXX X, will XX-Q implied based information, involve call estimated including statements. you assumptions. actual update and our by to well available place current events forward-looking Act these Treace no materially

John Treace

Thanks, everybody. of second driven of the in solid in with metrics, We're our steady increase and strength annual the for our quarter XX% increase our report first key revenue and a XX% underlying to strategies. commercial XXXX, by pleased a half business execution of gains the operating

investments to starting dividends and are year We out are pay initiatives earlier our scale. to also poised operations our that this encouraged laid with

focus with those as we address today. and Our building technologies a is fundamentally in foot. driven we're around changing mid the procedure technology complementary our with surgical disruptive that funding-related deformities that surgery by business believe this is And bunion such

national programs well surgeons demand, seminars demonstrating the Therefore, strong programs. bunion as initiatives targeted and to interim with XX the return with our sustained scores positive well rates data a our boot momentum clinical walking and weight-bearing demonstrating patient-reported industry our a our the our as to in body new Our become continuing programs XX at evidence of growing our through advanced we're following correction surgery. clinical in procedure. invest well participant as recurrence received book months commitment we from surgeon to active and training note, with surgeons of bunion for be data and pleased what DTC to low education through build as outcome to capacity and rapid care and training enthusiasm for patients marketplace, can we're positive courses. continue only with Of see From in standard the and regional

encouraged surgeon base. user active we're our in to see such, As steady gains

the in months, surgery surgeons in who quarter, penetration bunion ankle of second has includes perform reached our of who the the surgeon now active XX,XXX and As one base, surgeons estimated case at foot XX which U.S. trailing the least XX% performed

ancillary of base Adductoplasty only complementary surgeons. of initiatives, and with our connect As our sales we but continues our use well channel patients by not supported surgeon also help technology believe surgeon we to our products, of education Lapiplasty as system mature, patient utilization the procedures look and expanding adoption and forward our our as about growing awareness direct them increasing with to which portfolio gains, learn knowledgeable

rapidly organization here This the of such direct revenue and focused the team XXX% force, a penetration. represents meaningfully on contributed aware sales market the in has surgery We that Treace, med and at have is and mid that one foot expanding we're a to industry. specialized only bunion including related tech our

this in a higher reps, second the year. fleet quota-carrying XX% up quarter direct increase year increased ended to the sequentially and XXX We from XX% second Including had and XX mix field was of quarter invest in with XX% ago. just reps at revenue from XXX In the the associate over sales direct of specialists, XXXX. to sales we end clinical XX% the a force, of sales end to our the our management, direct from the to of a continue revenue [reps], employees the employees compared last employed at by We in employee channel up quarter, second transition direct XXX generated and XX% first quarter time. sales in

by We new team by programs. profile and our of growth continued by market-leading great our surgeon to success because unique technologies patient and joining here building innovative education team at clinical reps we backed that are driven evidence our these have supported believe and our sales are Treace, strong our

successful quarter. XX% but channel, not Having trending recruiting lies previously reps. announced of reps, sales goal the agents we XX% [W-X] in into with in direct with above from already employee sales year-end converting our on also independent new our the are success experienced some ended quarter only early coming of our Our of here third

of to reps. sales employee join our our to candidates sales from XXX team, year-end [indiscernible] expect interest now strong given addition, we In goal exceed

Lapiplasty identified U.S. billion-plus to developed of solution undergo due the disruptive market large million care. of only served bunion year, of of surgery correct X.X and $X candidates, was a standards cause address current mainly limitations a to which root specifically annual market. bunion associated XXX,XXX surgical and under with Our each We've

of rates X.X% a annual representing the As quarter U.S. X.X% XXXX, recurrence XXXX osteotomy market approximately our shown believe be as with billion variable bunion surgical reported clinical bunion total the the high surgeries X.X highly we surgical In and are as second penetrated procedures up addressable the annual the literature XX% reminder, and the of $X second of million of of have XX%. we in candidates, represents U.S., to XXX,XXX approximately plus X.X% the which from penetration have been metatarsal in quarter today estimated in market. representing procedure,

in force and as are relocating the other capacity which continued of encouraged headquarters penetration. are infrastructure process momentum growth our Based with sales the we on in conviction requirements product pleased to sustained that company's by growth, positive well for time our to surgeon supporting our and R&D facility, larger a the to We and as innovation market will for increased training, fourth warehousing once note again for market our we're and feedback strong rapid meet needs. history, allow execution the us

XX% our of the XXXX. Turning in QX growth second over Revenue quarter million, the now to representing results. quarter $XX second was

benefit With users continued demand our extremely not and to but QX QX ending we During XX% XXXX quarter of our progressed, bunion-focused active as trends also improving team, only our our which sales the pleased from year-over-year. including revenue number expanding commercial in top-line investments. direct steady for strong sustained positive key accounted metrics, surgeons, operating strategies new the with XX% trends increases we're surgeon up in of growth, mix, QX, our with

programs], $X,XXX year increases growth to OR reps positive and consistently in with support up Lapiplasty and forefoot XX.X expansion and per our as R&D and Investments channel, competitive patient average displaced sales as our direct their kits in increasingly surgeon ancillary our of mid-foot direct selling awareness with surgeon revenue blended due correction remain the such innovations Mini-Incision prior a and our fueling our in system our that's our investments uptake prices year-over-year confidence on have leverage making of are and the business, innovations expansion the year we giving complementary utilization case, for Adductoplasty products. the [DTC commercial system our Continued position products scalable X% about excited representing in our that us these strategy per We and growth. strong positive kits over X.X ago impact from QX, of a momentum. well-defined newer proven,

scores the with a development activities. in and both flagship which radiographic With revenue. commitment to results, patient-reported to continue safety patients ALIGNXD, raising clinical we $XXX revenue well ankle key X.X our to in interim including evidence Given are XX% multicenter and now clinical differentiating full-year over for QX, that providing use our of an to million] X- peer-reviewed patients and on publication our X-year article our recent XXst these resonates and are technology. years reported XXXX Lapiplasty $XXX treated supporting clinical care both and study. Journal support setting outcome and and driver refinement of efficacy which reflects surgery peer-reviewed products, the This over guidance of -- to our we business published commercial is surgery. May, of and on our our market bunion new [to standard our positive positive dossier, for of Foot Shifting million, we of to XX% our XX,XXX In announced XXX extensive increase XXXX from combined A prospective with we and believe we treated our patients. surgeons believe trends, growing as

meaningful with support multicenter continue with steady prospective our mini clinical to to clinical make -- we our to last study. As commitment and quarter progress mentioned provide evidence our XD innovations consistent Lapiplasty

address shifting cutting which Lapiplasty study offers the procedures. mini-incision X.X-centimeter this utilizes reminder, realign entire the a our the to bump, osteotome the a metatarsal bony first incision and the just is smaller cause of As much bunion approach which and case bone versus root system, with

new to and and board on During this look on interim we treat QX, Mini we the data report-outs to continue for forward patients study, future sites set. clinical providing XD additional

interest patients. Our resonate to surgeons growing and both with Lapiplasty Mini-Incision from continues approach

new surgeons adoption for see supporting quarter, of selling positive our to Mini-incision in system events for local at to events during our with attendance were participation Interest national contributions steady expectations by continue remainder average second our additional the our continued training strong year. blended plans We the and strong for prices. with of the

In both our throughout demand strong person, Adductoplasty the advanced tenured new and training surgeons where procedures mini-incision addition, approaches schedule our online year. such in can with skills and and as learn events on our held are

surgeon awareness, we've our and to long-term bunion-focused R&D aimed these report accelerate procedures, education, patient driving to site With been driving other As market and noted, investments footprint and initiatives. of making our very by year momentum we're this the direct innovations the penetration, penetration market related sales targeted expanding and additional into pleased more from demand traction channel for coverage our increasing advancing early and Lapiplasty marketplace. our at

a strong patients surveys. and by to seek relations have further we strategy, and show patient other place. awareness strategy DTC our and effective regularly media, We surgeon DTC schedule Our TV in consultation. targeted ultimately in and bunion and supported on We that to highly media, solution, campaigns surgeons surgical patients deformities are employ more key performance designed a public feedback conducted information engagement commercial Lapiplasty a data component these with from Search, our educate locate patient differentiated social believe including their active Google metrics of market to initiatives encourage

continue have to strong our grow and to investments direct conviction direct team. sales make our in field We force sales highly also specialized focused strategy

products levels, average, focused our higher Our XXX% at direct reps primarily channel demonstrated show generate our higher on resources our sell that, to typically and because reps direct relative blended cost utilization penetrate their fully analytics and and with Treace utilize independent they're within programs. agencies, markets scale continue on faster, ASPs. leverage sales corporate These to months, surgeon XX

expense matures, we force leverage to sales look As forward our direct over driving time.

our development to strategy. Turning product

of forward Anatomic product release bunion in design Proper speed the feedback excellent to providing several to R&D the releases reported anatomy. to advance in products industry on release of look procedure new commercial mid-foot the branded and X-in-X development in team systems both innovation patents important committed System, We've time speed release XX% to perform procedure. procedures. commonly are consistent ACFAS nationwide and ancillary programs patent packaged guide, technologies are SXA outcomes had of pending. product user tissue IP plate aimed of tissue and applications conditions represents specialized product, updates We surgeon we lapiplasty over keysoft February. average instruments defense user anatomy, anatomic Lapiplasty additional and with instruments. as to new and centered previewed improving this the correction soft our Plating we last designed driving our fixation designed guide. new to announced continue We the U.S. [combinant] of develop involved a to complete innovations new as Lapiplasty The third-generation end this penetration. joint our and Lapiplasty leadership the innovations. include [indiscernible] These our including on supporting well that Lapiplasty continuing technology both for X, advanced technology at next-generation addressing have TMT Lapiplasty bunion and an maintain surgeon involved we the And of receiving new IP in provides patient survey experience, an August Scientific achieving the instrument On an the in full been a our variabilities titanium of At the to more reproducibility Conference deformities. cutting pipeline XX innovations when and address provide at sterile U.S. surgical release and corrections accurate X-in-X XX our QX, using a core bones reduction recent this market the on and These as and Adductoplasty an

implants reimbursement the briefly surgical for which procedures, services recently for its cover and Speaking rates Medicare CMS has for our payment hospital case. to costs outpatient proposed released and used to products. ASC XXXX facility include in surgical supplies

slated a the codes. used that well-established CPT And by mid-single-digit note reminder, year As we're XXXX. these products the for our are increases in rates particular pleased are in for to existing procedures reimbursement covered codes

will deformities. we proud improve to positive of Ponte Assuming trend great facility country. on from clinical lifestyle bunion Florida multiyear codes] a the I'm focus reimbursement continue our in Based proposed limiting and delivered low team lives the throughout and In XXXX rates [CPT for are of community, know from we're by patients mid the helping procedures. rates in affirmed, increases of with this associated we Vedra, painful receiving feedback here suffering the that closing, the our continued mid-single-digit are foot execution related

development balance executing We our adequate sheet and to plan and planned commercial to believe supported a into that we take is strong are by profitability product us fund to initiatives. fully market

performance. I'll of surgical We have by in clinical standard DTC to Mark? a team talented mission of XXX the With sales care shared financial commercial patients. scale, of the sets employees data and of bunion our strategy that passion our surgical trends with bunions, to strong and that, improve a to programs management the over for Mark direct over poised review now of outcomes positive call reimbursement turn are advancing technologies the proven to and a are backed that

Mark Hair

XX% penetration orthopedic ago. increased a an case up increased in of in of kits, John. Revenue retained year-over-year the XXXX, an million, of ago, blended of volumes XX,XXX podiatrists the million to U.S.-based In up surgeons of you, second $XX increases quarter active surgeons. afternoon, one which average by quarter estimated the average least the prices. XXXX, average was kits Good months utilization representing was Thank XX%, $XX.X trailing and selling and XX% at from of procedure driven surgical an XX in performing second year year a from number X.X higher increase XX.X on the everyone. Surgeon

increase second second System nearly look and as quarter surging related XX.X% XX margin and quarter buy-in administrative $X,XXX, million, second the we in We was XX% Mini-Incision and $X volume total to million in second XXXX, were includes use administrative expenses our expenses Lapiplasty development the $X.X $X.X of a surgeon the operating the XXXX, over and quarter. direct to DTC average a compared products. forward in of and reflects operating channel, general expenses expenses basis This increasing compares investments our in driven pipeline and million, This of operational correction our and expenses our to year's XXXX general in was The the million. gains of with well our kits million, versus direct X% channel of second XX.X% of and the approximately Adductoplasty procedure and a as the was sales strategic million, base utilization approximately of increase and quarter point expenses our quarter, of well margin marketing includes as sales As $XX.X quarter initiatives, the support gross product growing in innovations. quarter new other initiatives. of by $XX.X of research complementary increase efficiency. Total as XXXX, ancillary driven overall mid-foot which for sold systems second to research and complementary products, increase continues of expanding expenses of $X sales mature, ancillary expenses development Lapiplasty second to million adoption XXXX, our sales price Gross expenses operating $XX in blended $XX.X in selling commercial prior of which and by of due million. marketing in and X,XXX

capacity support warehousing, sales for and prototyping, in larger facility growth, R&D increased of As requirements and our development, infrastructure process the are other a to noted we accommodates that to earlier, surgeon our rapid needs. relocating training, force

Importantly, we sales aggressively our force. investments with to direct expand these continue

representing XX end QX, of clinical XX% of at we sales had a including XXX the with Now XXXX, sales reps from end the specialist direct quota-carrying direct and the to in last XX% at reps the sales increased at our teams, and year. end sales field in of sales support quarter compared XXX fleet employee to XXX field the second entire management the increase employees

pleased the as mentioned, leverage with increasing forward force. with driving our P&L of we As increasing time. sales our to productivity direct seasonally in we the John operations when look up combined our we're of strong fourth middle And scale quarter, over

The period second $X.X Adjusted or to loss which $X.XX In to per $XX.X per and our strengthen a of share the a XXXX. loss million initiatives. for development capital, was favorably announced $X.XX product grew $XX of the previous we net $XX loss, quarter, loss part same net is our fund a net the we second to XXXX. million loss outstanding approximately that or flexibility. million quarter of the of compared $XXX.X Cash share per net the our was attributable equivalents and XX, us as extinguishment under share. We or $X.XX pay X-year credit per or to debt enhance $XX.X and profitability in reported debt to in cash common reduced shareholders, facility. liquidity $X.X new sufficient million and under loan second planned loan share $X.XX June excluding of arrangement balance million quarter sheet $XXX million million financial of our new market commercial off our believe have fully cost We fund into arrangement million were

outlook full me for to turn year of Let XXXX. our the

business an are $XXX guidance to increase the which reflects of compares and raising revenue. we mentioned, million remain $XXX our prior million. our John strength $XXX As XX% revenue encouraged guidance to of million over XXXX underlying XX% and $XXX to million, in to This XXXX revenue momentum by to our

As typical in headwinds. procedural orthopedic a for and surgeries seasonal elective execute the against monitor and to expect continue quarter third during reminder, softness we

QX, reported expect We strong with be year-over-year to consistent revenue growth. revenue QX in representing

leading Details on of your surgeon operator include be over to for City. the adviser the Relations website. take MarketSite on York Adductoplasty I'd you from let surgeons like Investor which the in Nasdaq September and the line to the turn a the can me questions. to our to With event found on concluding, moment Lapiplasty section our open presentations invite at event, that, XXth call will New Before to

Operator

while we'll Instructions] the compile stand question-and-answer the Q&A a we by session. roster. moment At this time, conduct Please [Operator

line first Robbie of Our with JPMorgan. coming call the Marcus is from

Robbie Marcus

Maybe sequentially push. up your I on per you quarter. Congrats to imagine reps nice a nice probably revenue are really start, starting of kind a flattish to had in quarter-to-quarter. the were procedure. tick Kits

being those to to Some of balance within great should the forward job the two adding getting doing is the adding about the surgery. we the moving And range? we procedure? how up. year how the on on You're a they're more going time other add-on how about clearly spent, How compensated foot in the as guidance revenue think bunion new procedures the rep of is metrics should think over

Mark Hair

that. Yes. start on Thanks, I'll Robbie. Maybe little bit a

year-over-year QX view that we're year. a XX% of First of revenue growth sequential last is of lot the with really all, the we way and over pleased growth,

Our sales reps based. are commission

it's the so on these -- occurred that's cases. each ASP they're And of in based blended full commission

report And metric. so we that that's another reason why

encouraged So products. sell all the to they're ancillary Lapiplasty well kit of as as our

Robbie Marcus

And new about the cadence the of the volume in how versus assumed and balance what's should of the range? over think guidance we price year

Mark Hair

course Again, as that guidance what the consistent QX growth far during had we quarter. us of QX, large Again, we we're fourth with. talking about year-over-year with of a we and in the larger lot a we're seasonally as year being the very really gives that things trend prepare with a pleased do what in as for

all we -- are activities education continue to do that. and which pleased medical on new we're surgeons, boarding And really active so the with

that to in from all have half activities year So been of benefit taking this the we're really half poised year. of the these back first to investing this the from benefit place

John Treace

offering commercializing next-generation add that Yes. refining continue additional just like the about. to ASP I doing We're that. contribute we're Lapiplasty to that [indiscernible] ASP to we now blended and a our plating system. bunion-focused to that out deliberate rolling will command products system ancillary Speed that little We've SXA and to also Robbie, spoke the continue going implants typically keep Release as very to will color a keep Mark's higher strategy a our and got right

expect could upward mix-related variability I some time. reported we the an over blended ASP while to think in generally ASPs, quarter-to-quarter in there blended continue trend So be

Robbie Marcus

How a amount you was should I surgeons to -- continue think you the top quartile in we it's of where add maybe how where of Maybe may about to follow-up, highest month. Great. was we or think so quarter, about XX.X% we about over you think XX do some are stand, your whether where said the that base time? as users a that users good the average migrate overall trailing as think versus, the

Mark Hair

do our they than on Lapiplasty. We Those using an years based more that annually. annual the have when XX Lapiplasty, surgeons are report basis, the started that of cases been on four productivity of all cohort more than doing

[indiscernible] And percentage practice, a it's of utilizing their Lapiplasty. really are think so large they we

So we adding we're surgeons, that years. that's going to over as gives grows the us what, these again, that that's it's pay additional and know dividends time, over that it confidence investment

Operator

Our next Ranieri question comes from the line with of Stanley. Andrew Morgan

Andrew Ranieri

the force? about Is demand John, about higher? all detail and well Maybe maybe increasing, driving of you into kind a of when about what active to thinking initial as you mentioned terms point it surgeons advanced can surgeons demand. ongoing utilization bit utilization strong it think just from that continues see you training more that to to just training point A And B I in Robbie's the question follow-up you're and direct as But tenured for go earlier. really the on little a education? gets sales the Is

walk of tenured course? initial see following a do what course of an you kind through that kind there in surgeon what after uptake and can maybe does an a you dynamic does then So surgeon advanced of us maybe

John Treace

cases following average second their came or have January Drew, don't then Mark's the great But December so. they we or year. does up whole, And XX X saying. measured events. a year, doing I year doctor our numbers first four, year, whether as question. off they're X, I that by they're I user know By by four around to in XX these X, these could a as around recall, activity specific

from number to of things. culmination cases and utilization that's is of So entire of over a designed our kind And one XX accelerate curve to ecosystem the quicker. that commercial try year

who and and certainly, is and on more, on a So our resources, a office very awareness to patients more each consultation, the these and of DTC their lot really fully of reps for with go they're sales their our experienced direct cases, faculty and of XXX% curve in other. Lapiplasty utilize And them in a Lapiplasty now users look on XX%, that patient do using product surgeons utilization on just the them X/X and they're innovations, but XX%, maybe their of room for they're earlier call do locator bunions that our learning technique and for with a to of course the what their and room procedure Lapiplasty, about that all along then they management they're ask to kind build they're assessment advanced tricks and and do, and postoperative with how Lapiplasty. preoperative the advanced tips Adductoplasty and learning informs

that build these other and believe, incorporate their and of skilled of Lapiplasty patients, to more of into some their trains we at drive So performing it practice. a on helps it feel them range making Adductoplasty broader blended ASP, that further, and them sort utilization tools comfortable helps

Andrew Ranieri

And sequentially this quarter flat. Mark it. guidance more for But question. maybe Got for keeping with third the

at I Just, looking at few as at last mid-single it's kind year. been mean, the past digit least a at least years, company, least of public

flat staffing mentioned Any curious seeing today? is with just shortages? about trends conservatism? more in little the talk those Or quarter-over-quarter? but you're actually seasonal You expectation it So more issues can if you bit orthopedics, softness a

Mark Hair

we what try of sales those we that growing our on the programs, patient we've some can and shortages that focus of in And question, kinds the staffing and about same education do companies -- to things Great Yes. really do our best We with and we those talked respect all things. it the see past to control, Drew. things kinds of see that DTC other channels, things. those

QX. seasonally And so that looking what's overall recognize for it's we just of staffing elective shortages, some I surgeries the at with and think we're macro in in slower considerations -- also right orthopedics the now, happening

at really year-over-year. the really consistent it's look that would we're a And business growth growth sequential with rate what substantial pretty that's basis, is at you not when a trend year-over-year. where looking QX So but driving be, quarter-to-quarter revenue still on

I favorable So if at that pretty it's think way. you it look

Andrew Ranieri

the force. Got back came think it. and But how higher than bit spend in making again. direct the Mark year? a completely And of for in understand you're the last kind about I one of should just the one expected, the we into sales investment half we that about that OpEx But

Mark Hair

to fair That's this an these some make into sales in spent important transitioning and independent sales investments the call covers. making amount [W-X] people, of all direct some right of on our hiring one. in of and reps time able been That's employed we've why people, channel. fully some talking agents another a that headway we [indiscernible] getting about that We've reason the been sales

that And so all we're and comes with and really that that growth, all some pleased channel. into growth sales additional investment with expenses

also the We had in the quarter some versus that increase DTC made we QX. investments in

we to with we I the different the of schedule we wanted don't why so QX very in are saw build just of how year respect we've to QX ahead be or what those And successfully that to with in far that it's that knew everyone plan. But half much so think pleased rather back made going that's from the really make investments. and -- sure

with pleased investments. those all So we're

Operator

BTIG. from Zimmerman comes Ryan of call next the line Our with

Ryan Zimmerman

of going a reimbursement can think as to in you topic. follow-up And about reimbursement a in talked the up average the you of the But kind do And go much it of John? to And it relative for bound I continue follow-up growth to questions reimbursement, we ASPs that on and because you pricing take kind expect about that the some surgery around of relative where on much Andrew. to up. -- in how just percentage if pricing the in curious I mid-single to your the of kind do digits. just think speak it's of think mind, I can John, -- on mean, how potential about just as to goes? context kind about how reimbursement I'm upper do you if about think can total other Maybe layering Rob a products? new pricing the of that bunion

John Treace

in our are different John. reimbursement And year even bunion we've petition we a that And [codes] and close particularly and [bunion] some with performed years attention or every CMS, the involve a five case that bunion in case. Great something key reimbursement it's procedures other within that are typical more. But communicate codes Ryan, other six physicians. multiple is CPT question. to Lapiplasty had involved and of pay positive can obviously, codes, work typical Yes, to trends

are that So other the ASP code, our that that's CPT codes, in have bunion of just $X,XXX, products we ancillary may not used blended lower CPT cost and that's some involving procedure.

to cost them their separate bunion involved the of own core ancillary could true Lapiplasty we reimbursement and on products, core ratios, feel overall, pretty those, those we're given our situation as of the tied for eventually an in good system. So do cognizant our But our those codes in eye a ceilings as well keep we that that which of now, like code and occur. have we're portfolio CPT are

So the products. the It's fraction Lapiplasty of and system is then is ancillary [$XXXX]. the a other not that

Ryan Zimmerman

the John. mean kind margin I think from margins of with dial gross ancillary appreciate you there color we of about kind already, gross No. as And these products, little products? impact bit the there. are the strong gross Mark, point, very on is layer Yes. of products? do move a And some those the contribution but of potential how higher a on newer the your ancillary to then I Fair margins

Mark Hair

with And there I issues, else, things well. all supply fortunately, and and we've chain able manage time, to pressures a the of inflationary are right, that constraints. lot been same everything happening at think extremely

we're So now. maintaining are our them. in gross really where opportunities there looking focused at right we're definitely the where for on area it's If margin

for improvement -- from -- if we're increase. But at pressures looking going really it's opportunities if always or are going here. we're we offset of to to pleased some where be an be Just unclear there with the it's will and to other

Operator

turn now for to back to I remarks. would like call the Vivian closing

Vivian Cervantes

New Thank at seeing Advisor] us you Thanks, [Surgeon City forward quarter concludes York Treace update look with XXXX. next call, everyone, you, you of our following joining our on of close and our On XXth thank today. Kathy. September in event the to to MarketSite our provide for we also Nasdaq at you, Medical, This everybody. behalf and third

Operator

may program, conclude now. and the does disconnect you This

Treace Medical Concepts (TMCI) 13 Aug 222022 Q2 Earnings call transcript