Elutia Inc. (ELUT) Q3 2021 Earnings Report, Transcript and Summary

Good day, and thank you for standing by. Welcome to the Aziyo Biologics Third Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker today, Leigh Salvo, Investor Relations. Please go ahead.

Thank you, and thank you all for participating in today's call. Joining me are Ron Lloyd, Chief Executive Officer; and Matt Ferguson, Chief Financial Officer. Earlier today, Aziyo released financial results for the third quarter ended September 30, 2021. A copy of the press release is available on the company's website. Before we begin, I'd like to remind you that management will make statements during this call that includes forward looking statements within the meaning of federal securities laws, which were made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that do not relate to matters of historical fact or relate to expectations or predictions of future events, results or performance are forward-looking statements. All forward-looking statements, including without limitation, those relating to our operating trends and future financial performance, the impact of COVID-19 on our business and prospects for recovery, expense management, expectations for hiring, growth in our organization, market opportunity, guidance for revenue, gross margin and operating expenses, commercial expansion and product pipeline development, expected future product launches and milestones and expected results and performance of our partnerships and commercial products, including patient outcomes, are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors section of our public filings with the SEC, including our annual report on Form 10-K for the year ended December 31, 2020. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, November 9, 2021. Aziyo Biologics disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements whether because of new information, future events or otherwise. Also, during this presentation, we refer to gross margin, excluding intangible asset amortization, which is a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure is available on the company's earnings release for the third fiscal quarter ended September 30, 2021, which is accessible on the SEC's website and posted on the Investor Relations page of Aziyo's website at www.aziyo.com. And with that, I will turn the call over to Ron Lloyd.

Thanks, Leigh. Good afternoon everyone and thank you for joining us. Since our last call, we've continued to execute on our business strategies, and achieved $11.5 million in revenue for Q3. Year-to-date, we have generated over $36 million in total revenues, a 21% increase over the corresponding period in 2020. More importantly, we're preparing for a seminal year in 2022. As we look to next year, we see several catalysts for growth. With CanGaroo, we'll be scaling our commercial organization, generating clinical data and advancing CanGaroo RM, our next generation product with antibiotics. We remain on track to file CanGaroo RM in Q1 and planned for approval in the second half of next year. We believe CanGaroo RM has potential to exceed a $100 million in revenues and be the core driver of value creation for Aziyo over the next few years. Second, with SimpliDerm, we’re expecting new clinical data, greater market access, and continued growth. For both CanGaroo and SimpliDerm, we're building off strong momentum that's been created over the second half of this year. And third within our orthopedic and spine business, we anticipate bringing on board additional partners and launching new viable bone matrices as we return to growth mode. In addition to further support the safety of these products, we will have in place new screening and testing procedures, which we believe will set a new standard in the industry. Finally, we are participating in a patient support program for those impacted by our single donor lot recall of FiberCel. While it's very early in the litigation, we feel confident we have our arms around the legal challenges of this recall, and believe it will be manageable within the company's resources. Now I'm going a bit deeper in each of the main areas of our business. I'll start with CanGaroo. CanGaroo is the only commercially available biological envelope that forms a natural, healthy pocket for holding implantable electronic devices. We are making exciting progress on the commercial and medical fronts that showcase the remodeling benefits of this product. Despite the headwinds of COVID that negatively impacted CRM device placements in August and September, sales of CanGaroo improved during the quarter. There were several factors that drove this growth, including: growing awareness within the electrophysiology medical community for CanGaroo's remodeling benefits; the impact of peer-to-peer programs, which have been very influential in developing new users; opening up new accounts by leveraging our recently signed contracts with healthcare delivery systems and our Breakthrough designation within Premier; as well as continued contributions from our partnerships with Boston Scientific and Biotronik. More specifically, during the quarter, we saw increased productivity from our U.S. direct sales force, as our newer reps gained tenure throughout the year and access to our customers reemerged. And we are very encouraged by this increased momentum, both in higher utilization within existing accounts, as well as the opening of new accounts, and we see significant opportunity for additional expansion. Also encouraging was the traction we saw with our partners in Q3, with Boston and Biotronik places of CanGaroo reaching their highest levels for the year. In parallel, we've been successful in mining opportunity through our Premier Breakthrough Technology designation, as well as with other healthcare system partners. These relationships have been key to driving CanGaroo sales, and we expect that to further leverage through these relationships going forward. We are also confident in our opportunity to add additional healthcare systems in the future. Outside the U.S., we saw increased sales of our CanGaroo Envelope in Europe due to the launch of our new expanded label. As a reminder, Aziyo received approval in January that now permits CanGaroo Envelope to be hydrated in a gentamicin solution prior to implantation. This new label was launched in Q3 through our partnership with Biotronik, leveraging clinical data that was presented at the European Society of Cardiology Annual Meeting this summer. As an update on the clinical front, both the HEAL study and the de novo study are progressing as expected. We look forward to this clinical data for CanGaroo and we're confident results will further validate the unique clinical benefits derived from our biological envelope. On the product development front, as mentioned earlier, CanGaroo RM remains on-track for FDA submission in the first quarter 2022, and we are planning for clearance and launch in the second half of the year. The new envelope will be enhanced by adding the antibiotics rifampin and minocycline. Our team continues to execute against these key milestones for this biological product. And again, we're confident in its potential to create substantial, long-term growth for Aziyo. In the soft tissue reconstruction area, we continue to make progress in our SimpliDerm business. Our goal with this product is to generate clinical data, expand access through payers and hospital systems and drive product sales through our national distributor network. We are completing a clinical study comparing SimpliDerm to a market-leading product and plan to submit the results this quarter for publication early next year. We'll leverage this data in our prior publications to expand market access. Finally, we are pleased with the progress our distributor network is making in opening new accounts and further penetrating existing accounts, which is driving sequential, quarterly sales growth. Turning to our products for the orthopedic and spine repair market. Starting with an update on the recall of a single donor lot of our FiberCel product. While this was an unfortunate back, we conducted a thorough review of our procedures for screening donors and producing FiberCel. We found no deviations from established industry and regulatory protocols. The FDA also completed inspection of our Richmond, California facility in June, and issued Form 483 observations, meaning that they also found no deviations from accepted protocols and standards. Nonetheless, we remain committed to supporting patients that were impacted by this event. They've agreed to find a patient support program in which we'll participate as a limited sponsor with Medtronic. Under this program, qualifying patients may receive reimbursement for out-of-pocket medical and incidental expenses related directly to seeking testing or treatment or treatment related to the recall. This program is designed to support patients and ensure that they are not delaying any necessary treatment. We remain committed to providing high quality, safe and effective products. As such, we've developed and implemented measures that further enhance the safety of future production launch for our Viable Bone Matrix products. These measures include implementing heightened donor screening procedures and developing additional methodologies to test tissue products. We believe these safeguards exceed applicable FDA and industry standards for donor screening and testing. Despite these actions, we were obviously disappointed to receive notice from Medtronic of the company's decision to discontinue distribution of any cellular bone matrix products, which includes an existing agreement for Aziyo’s FiberCel product. As mentioned in previous communications, our agreement with Medtronic for our fiber-based Viable Bone Matrix product was non-exclusive. And we continued to sell this fiber-based product through our other partners. We remain confident that the quality performance of our products will enable us to expand business through our existing partners as well as secure additional distribution partners for our products that we have on the market that day, as well as pipeline products we plan on launching in 2022. Turning to our non-core contract manufacturing business. We saw upside in the quarter, largely due to fulfilling the supply requests from a new customer, building inventory in advance of their product launch. Going forward into Q4, we anticipate that this segment of our business return to levels more in line with the first half of this year. Finally, I'll mention that we recently welcomed Peter Edwards to the company as a General Counsel. His extensive legal and business experience in the healthcare space has already proven valuable in numerous aspects of our business. His addition makes our strong team stronger. And together, we believe we're poised for great accomplishments in the years ahead. With that update, I'd like to turn the call over to Matt.

Thank you, Ron. As mentioned, net sales for the three months ended September 30, 2021 were $11.5 million, a 3% decrease from $11.8 million in the same period of the prior year, and a 5.6% decrease from $12.2 million in the second quarter of 2021. Net sales of core products were $8.6 million in the third quarter of 2021, compared to $10.3 million for the third quarter of 2020. And net sales of non-core products were $2.9 million in the third quarter of 2021, compared to $1.4 million in the third quarter of 2020. The decrease in core products was driven primarily by a decline in our orthopedic and spinal repair business, following the discontinuation of sales of FiberCel by its distributor. The sales across product lines were also impacted by lower procedure volumes in certain geographies due to the resurgence of COVID-19 hospitalizations. These decreases were partially offset by growth in our CanGaroo and SimpliDerm product lines. And as Ron mentioned, the significant increase in non-core products was driven primarily by one contract manufacturing customer building inventory for a new product launch. Gross margin for the third quarter of 2021 was 32.1%, as compared to 47.1% in the corresponding prior year period, and 46.2% in the second quarter of 2021. We also look at gross margin, excluding the impact of non-cash amortization of intangible assets. And on that basis, Q3 would have been 39.5% versus 54.3% in the year ago quarter, and 53.1% in Q2 2021. The decrease in gross margin was primarily due to lower yields in our orthopedic and spinal repair product lines related to heightened donor screening criteria ahead of the implementation of enhanced product testing, as well as write-down of inventory in certain categories. Together these factors impacted margins by approximately 12 percentage points, and we do not expect these costs to continue at similar levels going forward. Total operating expenses for the third quarter of 2021 were $10.7 million, a 30% increase from $8.2 million in the third quarter of 2020, and a 4% increase from $10.2 million in the second quarter of 2021. The main drivers of the increase compared to the year ago period were R&D spending related to CanGaroo RM development, and G&A increases related to operating as a public company. Loss from operations was $7.0 million for the third quarter of 2021, as compared to a $2.7 million loss for the year ago period. Net loss for the quarter was $8.3 million, as compared to a net loss of $6.7 million in the third quarter of 2020, and $2.4 million in the second quarter of 2021. Net loss per common share in the third quarter of 2021 was $0.81, compared to a loss of $15.79 per share in the year ago quarter, which was prior to the conversion of the company's preferred stock into common stock in association with the company's Q4 2020 Initial Public Offering. As of September 30th, we had a cash balance of $22.6 million with an additional $4.5 million available for borrowing under our working capital line of credit, resulting in total liquidity of $27.1 million. Turning now to our outlook for the business, we project full year 2021 net sales in the range of $47 million to $48 million, which represents growth over 2020 of 10% to 12.5%. Providing a bit more color on the final quarter of the year, within our core products, we've been seeing solid growth in CanGaroo and SimpliDerm, and we expect that to continue. However, this growth is being offset by softness in our bone repair business, primarily due to our FiberCel distributor exiting the market. We expect the net result of this to be core product sales in the fourth quarter in a similar range to the Q3 results. And as we look ahead to 2022, we are confident we will see core product sales grow on a sequential basis and for the full year, as we advance CanGaroo RM, sign up additional orthopedics and spine partners and make further gains with SimpliDerm. In our non-core business, as Ron mentioned, we expect Q4 sales to settle back close to levels achieved in Q1 and Q2 of this year. But there again, we also see multiple opportunities for growth in 2022. And with that, let me now turn the call back to Ron for closing comments.

Thanks, Matt. There is no question, we faced challenges in 2021. But I'm proud of how the team has managed through these events. Again, as we look at 2022, we see multiple opportunities to increase value in the company. In CanGaroo, we will be expanding our commercial organization, generating clinical data and plan relaunching CanGaroo RM. With SimpliDerm, we are expecting new clinical data, greater market access and continued growth. And within our orthopedic and spine business, we anticipate bringing new partners on board and launching new viable bone matrices as we return to growth mode. In closing, I want to thank the Aziyo team for their continued drive towards the success of our company. We have a very dynamic future ahead, with a number of catalysts on the horizon, I am confident will enable the company to realize its full potential and shareholder value. And with that, we'd now like to open up the call for your questions.

[Operator Instructions]. Our first question will come from the line of Matt O’Brien from Piper Sandler. You may begin.

Good afternoon, guys. This is Drew on for Matt. Thank you for taking the questions. You are one of a smaller group of medtech companies that was able to get to their Q3 numbers, despite what was a pretty disruptive quarter from a COVID perspective. So, maybe you could just kind of walk us through what you saw from COVID here in the quarter. How many fold that headwind was that you were able to offset? And then your guidance does assume a bit of a step down or a little step down from a sales perspective in Q4. I think you mentioned a little bit of the details on that between core and non-core, but what exactly is the difference that gets you to the higher end of the range, is that due to COVID?

Sure. Yes, actually we are very pleased with the performance in Q3 for our business. And if we think about some of our products, we had an excellent quarter with CanGaroo. CanGaroo was a leading product from a growth perspective. And as we said during the call, there is a number of factors for that. Again, the remodeling benefits of CanGaroo is resonating with customers. We've been able to increase market access through our contracting. We did a number of peer-to-peer programs, which also brought on new users and we have seen increased productivity from our sales reps as well as contributions from our partners. So, I think again, despite COVID, we had a very strong quarter as it relates to CanGaroo growth. Also our SimpliDerm product performed very well in Q3. And we are getting additional traction for that product. But clearly like others, especially more on the viable bone matrix side, we did see an impact of COVID that impacted cases for that business. And then finally, the other factor that helped us in Q3, we did get a larger order that came in through our non-core business. Primarily one of our new customers actually was ramping up for a product launch and wanted to build inventory. So we had a little bit higher amount of sales for that customer in Q3. But all in all, very pleased with the performance of Q3, especially given the headwinds of COVID that certainly impacted August and September, and certainly impacted the Southeast, which we also have a fairly strong business in. As we look to Q4, again, part of our change from Q3 to Q4, again, if you look at the non-core, the stocking of that one new customer obviously will not repeat in Q4. So that's sort of a lock down. As we look at CanGaroo and we look at SimpliDerm, we really have strong momentum building on those products and we anticipate continued growth of those products. But I think we're going to have a little bit of offset of that growth through our viable bone business, again, some of the macro environment still lingering with COVID. And again, we're looking forward to adding additional targets as we get to 2022 to offset some of the impacts of our large distributor Medtronic exiting the business.

And then just as we're thinking about next year here, I think it's a little bit difficult to tease out the exact growth rate of the business without going into details on each of the product segments. So I was just wondering if you can provide a -- just a general framework on what sort of range to think about for CanGaroo and SimpliDerm growth? I think that The Street has you modeled at about 20% top line growth for the full business. But obviously, you have some comp issues from FiberCel in the first half of the year. So just maybe overall thoughts at either of those topics there.

Yes. I don't know if we really want to get into ‘22 guidance here on this call. So I prefer probably not to get into specifics on percentage growth. But I do think again, as we think about CanGaroo in particular, 2022 is going to be really an exciting year for us. We anticipate filing CanGaroo RM our next generation product, which includes the antibiotics rifampin and minocycline. Our anticipated timing for that is still Q1. We remain on track with the development for that product, and we really see that there's the best solution in the marketplace having a biological product with remodeling benefits, and then obviously having with that also the antibiotics. So we do think this is going to be a key driver of growth for the company going forward. And we'll be obviously prepping for the launch of that product next year. And in anticipation we'll look to expand our commercial organization, probably look to add additional sales reps, with hiring starting here in late Q1 of 2022, and bringing more people on board in the second quarter of 2022. So again, we’re very excited about CanGaroo and the possibilities of growth from that product and our pipeline product RM. On SimpliDerm again, we're seeing nice traction with that product. We're going to have additional publications that we anticipate will hit The Street next year, in 2022. We anticipate we’re getting additional market access and we're getting great leverage from our distributor network. So, very exciting opportunities for both of those products in 2022. And as I mentioned on the viable bone side, again, we're putting in place heightened donor screening. We're going to have in place new testing procedures which we believe will set a new industry standard as we get into 2022. And we're confident again, based on some discussions we've already had with potential partners, we feel really good about the opportunity to bring on additional partners for our viable bone matrices. And we also anticipate launching a couple of new products next year within this category. So again, very excited where we're going for 2022.

Our next question comes from line of Joshua Jennings from Cowen. You may begin.

Hi, this is actually Neil on for Josh. Thanks for taking our questions. Maybe just on SimpliDerm, I think you added a few new regional distributors in the second quarter. Could you maybe just talk about the progress you've seen kind of with the distributor network there?

Sure. So SimpliDerm, again maybe just take a step back for those that may not be familiar with the product. Again, we've used our patented process to decellularize human dermis tissue, and our process is done in such a way that it removes the cells, but really does minimal damage to the underlying structural matrix. And as such, we've shown lower inflammatory response to a market-leading product, and we’ve shown better integration to market leading product in a number of bench, and non-human primate studies. We've also now been able to do an initial publication from an early user experience on the product. And we anticipate additional publication as I mentioned in 2022. So again, we've designed this, we believe to be equal or better than the market leader within this space. From a commercialization standpoint, we've elected to go with a distributor network at this time. We've been able to expand that network in the second half of this year to be a national network, and we're seeing increased productivity from that distributor network. So we're pleased with the progress our distributors are making and we've been able to complement them with additional market access as we continue to win contracts within new healthcare systems and hospitals for expanded opportunities as well. So pleased with the progress we've been able to accomplish this year and we're going to ride that momentum into 2022.

Great. And just one follow up on, in terms of the progress you're seeing in your momentum with kind of the Premier and Providence Health partnerships and potentially other kind of provider partnerships, anything -- any color you can add there in terms of what you're seeing?

Yes, actually we've been very beneficial. And again, if you take a step back, I think a testament to our team, both on the commercial and the medical front of doing an excellent job of explaining the unique characteristics of having a biological envelope such as CanGaroo. And so Premier saw the benefits, gave the Breakthrough Technology designation, as well as other healthcare systems see the benefit of this product, especially in certain patient populations where remodeling is very important. And so we've been able to leverage that, and then tap into that to open up new accounts. And so our team has been very focused on adding new accounts, and then obviously starting to pull through of that business from those accounts. So very excited about the progress that we're making through our contracting organization. And again, I think as quarters go by, we continue to see the addition of new accounts, and that will continue to build to the business and again, provide additional growth as we go forward quarter-by-quarter.

One last follow up if I can sneak it in. Just curious on your updated thoughts in terms of your current M&A strategy, and kind of areas of focus for that?

Yes. So we continue to look at opportunities from M&A perspective, mostly probably more on a tuck-in perspective. As we think about it though, we're still very excited about our organic opportunities. If we think about our key products, we're probably in single-digit market shares for our key products. So we have a lot of opportunity to grow CanGaroo, opportunity to grow SimpliDerm. Again, we still think there is opportunity to grow within the viable bone matrix business as we bring forth new products. So again, from our perspective, we see tremendous growth opportunity by the assets that we have in-hand today or near-term pipeline with CanGaroo RM being a key driver of growth. But with that said, we continue to look at opportunities that would be complementary, in particular complementary to the products that we have more of a direct presence with, which would be the CanGaroo in the cardiovascular business or complementary to SimpliDerm. So, we continue to look at opportunities there. And if we see the right opportunity, we will pull the trigger.

[Operator Instructions]. Our next question is from line of David Rescott from Truist Securities. You may begin.

Hey, Ron and Matt. Thanks for taking the questions here. I guess, I think what we're thinking about, or we thought about this, FiberCel is being kind of run 2 million within the quarter. And so, when you back that out, it kind of implies mid-single-digit sequential growth is in the quarter within the core business. I mean, does that kind of make sense from the way you've been thinking about the growth here?

Yes, David. This is Matt. We're looking at it both sequentially and quarter-to-quarter. For Q3, excluding FiberCel, we definitely felt like we saw growth. The Q2 number, you had it right. We did call that out at about $2 million for FiberCel. So, without that definitely would see growth sequentially. But more importantly, we're thinking about the growth that we can continue to drive not just through CanGaroo and SimpliDerm, which we talked about as being the drivers of growth for Q3. But really all of the franchises within our business, all of the product lines, we see great opportunities to grow from where they are now. Of course, there will be a bit of a hole to fill in the bone repair space, but our other partners are continuing to perform well and we also see a lot of opportunity to add additional partners going forward there.

Okay. I guess maybe more of a high-level question about CanGaroo and then I guess the business as a whole. I mean, I appreciate kind of a more in depth commentary, I think you gave on this quarter, just around some of the utilization within accounts of CanGaroo. But I mean, I guess, in context, when you think about the competitor TyRx back in 2014, they were kind of acquired for $160 million. And it seems like maybe that business was kind of running, maybe the similar rate as CanGaroo. I mean, having an accelerating type growth profile, I mean, that obviously was with a few years ago. But when you think about that really in the context of where the valuation of Aziyo as of today, I guess, what do you think is one of the factors or some of the points of the story that investors might be missing here? And then I guess again, from a high level, I guess, could you really discuss how you can create value within the business, without necessarily having the infection prevention label. But also as we think about bringing that infection prevention label online in kind of that 2022-2023 timeframe?

Sure, and I actually think it's an excellent point. And I certainly see from a valuation perspective, CanGaroo being similar, if not greater in valuation than what TyRx’s. So if you think about it -- and your right, TyRx acquired for roughly $160 million plus some milestones at a sales level somewhere to where CanGaroo is today. I think again, when you look at the technologies, we believe we have a better technology having a biological envelope. And of course, we do need to get the indication to have it such that it also includes the antibiotics, rifampin and minocycline to match TyRx. So I think that's obviously a key driver of value here is to have a similar label from an infection perspective here to have those antibiotics on board. But we would concur. We believe there's a tremendous value with CanGaroo. And I think if you fast forward from the TyRx acquisition from where we are today, we believe that the TyRx product is more than a $100 million in revenue from a performance perspective. But even with that product at $100 million, there's still a lot of room for envelope penetration within the CRM business. We estimate that again, probably the one out of five patients are getting envelopes as it stands today. So we think there's a lot of market opportunity for expansion, and we can easily see CanGaroo being more than a $100 million in revenue as well. So when we think about our company, and we think about the opportunity with CanGaroo and we think about the near term horizon, because again, we're on track here to follow in Q1, where you can see this product on the market in the second half of next year, we think that unlocks tremendous value creation for the company. And we would anticipate that we should have a similar valuation if not greater valuation with TyRx based on the technologies that we have of actually having a biologic that provides remodeling benefits for patients, which go beyond just the short term reduction of infection by having antibiotics. So we think there's tremendous value, and we need to probably get out to investors to make sure they understand that value creation as well.

That's helpful. I guess just the last one then on CanGaroo. I mean from -- just around like the rifampin and minocycline formulation and I know you've discussed in the past how the manufacturing validation has been completed there. And I guess, in what sense, I guess, is that validation somewhat -- or the validation of that or the addition of that somewhat derisked I guess from a approval standpoint? I mean, if we think or we kind of have an understanding that the addition of rifampin and minocycline is used in infection prevention. So I guess, is there a risk at all here either with the formulation itself or with the way that you actually integrate the formulation into the CanGaroo product that we wouldn't expect to see some kind of infection risk reduction? Just any commentary there what would be helpful?

So, our goal here in the product design, how we created the product was to embed within the CanGaroo the antibiotics rifampin and minocycline in such a way that they have the same release kinetics as TyRx, and load them with relatively same level of antibiotic concentration on dosing as TyRx. So in a sense, you get the same delivery mechanism of our product that you see off the predicate device in this case, which would be TyRx for those antibiotics. So that was the design goal. And again, we're able to lock down our product design achieving similar release kinetics of those two antibiotics. And I think that's the most important part here from a risk perspective was to be able to get the antibiotics to be loaded and then released in a similar fashion. And so now we're doing the additional studies required by the FDA to do the 510(k) filing to show that we're comparable here to the predicate and those are underway and they're tracking nicely. Of course, we do have to complete those studies and then make the submission to the FDA. But from a product design standpoint, again I think we nailed that by getting the same release profile that matches up identical here in a sense to TyRx release profile. And so we're very excited about that aspect of it. And again, bringing forth this expanded opportunity in the near term horizon for CanGaroo.

Thank you. That was our last question for today. I'll turn the call back over to Ron for any closing remarks.

Great. Thank you. And thank you for your time today. Let me just close by saying the Aziyo team is fully energized. We're very excited about the near term horizon and the number of growth catalysts that we have for our company. And we're very confident in the future of where we're going. And so we look forward to giving you updates at future calls, as we continue to progress and advance the company. So again, thank you very much for your time today.

And that will conclude our conference call today. Thank you for participating. You may now disconnect. Everyone, have a great day.