Good afternoon. Thank you for joining us today to discuss the results for LifeMD's Second Quarter of 2021 Ended June, 30, 2021. Joining the call today are Justin Schreiber, Chairman and Chief Executive Officer and Marc Benathen, Company's Chief Financial Officer of LifeMD. Following managements prepared remarks we will open the call for question and answer session. I'd like to remind everyone that today's call is being hosted via webcast and the recording will be made available via the link in today's press release which is available in the Investor Relations section of the company's website. Before we begin I would like to remind everyone that during this call the company will make a number of forward-looking statements which are subject to numerous risks and uncertainties that may cost the company's actual results to differ materially from those projected. These risks and uncertainties are described in the company's 10-K and 10-Q filings and within other filings that LifeMD they make with the SEC from time to time. For looking statements made during this call are based on current information available to the company as of today. The company assumes no obligation to update or revise any forward looking statements after today's call except as required by law. Also, please note that management will be discussing certain non-GAAP financial measures that the company believes is important to evaluating LifeMD performance. Details on the relationship between these non GAAP measures to the most comparable GAAP measures and reconciliations there can be found in the press release issued earlier today. Finally, I would like to remind everyone that today's call is being recorded and will be available for replay in the investor relations section of the company's website. Now I'd like to turn the call over to LifeMD CEO Justin Schreiber. Please go ahead.

Thank you, operator and good afternoon, everyone. Thank you for joining us today and discuss our second quarter 2021 results. Our strong top line performance continued this quarter, building on top of the incredible momentum we saw from the start of this fiscal year. Even with pandemic restrictions being largely lifted, we continue to see record demand for our telehealth products and services. Telehealth orders were up 155% over the same quarter last year. Our subscription based patient customer numbers also continued to grow with a record 93% of revenue being generated by recurring subscriptions. Patient retention across all brands remained at record levels. All of this added up to LifeMD producing record revenues of $22.3 million up a 145% from the year ago period. Perhaps most impressive was the despite a significant 20% increase in media rates across our core digital channels. Our acquisition team was able to drive an 8% sequential decrease in customer acquisition costs. This optimization allowed us to double down on our discretionary marketing investment to drive an 11% sequential increase in new patient acquisitions per day in comparable brands and further increase our market share. During the quarter we also begin marketing our newest tele-dermatology brand Nava MD. Early results have been promising we're strong reception from patients. Nava, MD customer acquisition costs has so far been extremely favorable, with an estimated payback on investment of two to four months. As we've said previously, we believe that Nava MD will be a very meaningful top line and profitable contributor over the long term. Organizationally, we made several important key strategic hires, especially with our new president Alex Mironov. Alex brings to us over 20 years of experience in business development, mergers and acquisitions and corporate strategy as well as extensive experience in the pharmaceutical…

Thank you, Justin and good afternoon, everyone. As Justin mentioned, during the quarter, we continue to execute with strong top line and operational performance. We grow our offerings, expanded our existing brands, launch new business lines and capabilities and improve their efficiencies all while maintaining a high level of service. A key factor driving our strong performances quarter was how we were able to drive improving unit economics by further optimizing our media strategy to drive an 8% sequential decrease in our CAC. This was a remarkable achievement given how at the same time, digital media rates across our channels increased by more than 20%. Adjusting for this sizeable rate increase, our team was actually able to drive an approximate 30% improvement in our media efficiency on a sequential basis, while also requiring new patient customers at a per day rate there was 11% higher than the previous quarter. Leveraging this performance and our strong unit economics which pay back in two to four months, we made the conscious decision to efficiently increase our total discretionary acquisition marketing spend during the quarter to capture market share. Taking a closer look at our results revenue in the second quarter of 2021 total the record $22.3 million up 145% as compared to the same quarter a year ago, and up 23% sequentially and this was largely recurring revenue with 93% of our revenue generated by recurring subscriptions in the second quarter of 2021, which was just 56% in the same year ago period. And our retention on these new subscribers remains very strong. In fact, 60% of our revenue this quarter came from Billings have already existing subscribers as compared to just 22% of our revenue in the same year ago quarter. Telehealth net revenues grew over 100% to $15.8 million. Our…

Thanks, Marc. Overall, it was a tremendous second quarter. The elevator infrastructure with the appointment of an exceptional president, consummated three transformational partnerships immediately after the quarter end, drove outstanding acquisition marketing performance despite significant cost headwinds in the media market, launched Nava MD, and laid the foundation for what we expect to be a very successful upcoming launch of our primary care platform LifeMD. The strong performance in the second quarter has carried into the current quarter, we're continuing to see very strong demand for our products and services. Just recently, we set our new single day record for new patient acquisitions. In closing, our numbers speak for themselves and with each passing day, our vision of disrupting healthcare by building the leading telehealth business is coming to fruition. Our continued growth will depend on the strength of our team, technology and operations to support our immense vision and efforts. We have strengthened our foundations significantly in the last quarter, setting up the continued growth of our existing businesses and the launch of new brands and offerings, such as our primary care platform, while remaining on track to reach profitability by the end of 2022 barring significant investments in new brands or verticals. We still have a lot of things to accomplish in healthcare. And we remain focused on continuing to build our position as a leader in direct and patient telehealth. We'll do this by delivering unparalleled care through our affiliated providers as we continue to disrupt traditional healthcare. So thanks again to our providers and their patients, our team and our shareholders, it wouldn't be possible to do what we do without everyone's support. With that, I would like to open the call for Q&A.

[Operator Instructions] And we'll go first to Andrew D'Silva of B. Riley Securities.

Alright, good afternoon. Thanks for taking my questions and really, congrats on all the progress. A few quick ones for me. First, just given the vaccination of progress and then loosen the restrictions during the second quarter. Can you talk around retention and what you saw from a stickiness standpoint? And is it fair to assume those trends are holding true into summer?

Yeah, thanks, Andy, I can tell you that in the second quarter of retention was comparable to what it was in the first quarter continued to remain very high across all prescription products. Within the first billing cycle, we continue to see 75% to 80% retention within those first three to four months after the person becomes an initial patient and then continued strong year in this economics with the payback within the first call in two to four months and then 2x return in the first year. So the pandemic restrictions loosing have really had no impact on our business. In fact, we are actually seeing improvement in retention thus far as we've started the third quarter. So you know, business from a new acquisition standpoint and a retention standpoint, it's actually been performing at record levels post a lot of restrictions being lifted.

That's really interesting. And moving over to some strategic initiatives are also highly focused on that you brought on Alex, who's clearly driving a lot of what's going on. I'm curious how that pipeline looks and what kinds of opportunities we should be thinking about going forward or where the business can be administered better? And can with the recent diagnostic partnership, I was curious if that positions you introduce things like testosterone replacement therapy.

Yeah. Andy, this is Justin, with regards to the dev pipeline. You know, Alex has done an exceptional job in the first 90 days. Definitely, you know, I think that what we expected was right on, I think he's exceeded our expectations. I would estimate that we have at least 10 potential partnerships with the pharmaceutical companies that are in the pipeline, some more promising than others, but a lot of very exciting stuff there especially considering Alex is only 90 days in. And then your second question, I'm sorry, I kind of missed it. It kind of broke up.

Yeah, as far as diagnostic partnerships go, on the diagnostic partnership goes, does that position you to be able to provide testosterone replacement therapy across the platform?

It could be used for an offering like testosterone replacement therapy, you know, we've stayed away from controlled substances, and going into the testosterone space and testosterone replacement therapies is not something that's kind of on the near term radar screen, but, you know, certainly look the relationship with quest and actual health first and foremost for our virtual primary care offering, it's essential. We were able to we have very preferential pricing, cash pay pricing on 150 very common tests where our patients can walk into any quest location across the country, and no one will avoid the diagnostics a lab test, because of the cost, I can assure you that. So that's really exciting for us. And then secondly actual health gives us the ability to go and send us phlebotomist to the patient's home to collect blood work, if that's more convenient for them, and they don't mind paying an additional fee for that. So many of these conditions specific, indication specific telehealth offerings will require lab work. You know, testosterone therapy is one example. So we look at this as a really important piece of the puzzle as we continue to diversify our portfolio of offerings.

Great color, thank you. Lastly for me, should we expect CAC or CPAs to continue to improve? And how should we manage that thought process with overall sales and marketing spend? And can you also give a little context around the ad race environment currently, and maybe how we should think about that for the rest of the year and seasonality credits would be useful?

Yeah, Mark. So CACs, we've obviously now made two quarters of sequential improvements, the first quarter, we improved 15% to 20%. By brand versus the prior quarter, and then this quarter, we improved another 8% sequentially against the first quarter. And actually, our improvements would have been close to 25% to 30%, had the media market not seen rates that increased by more than 20%. So we're able to obviously more than offset that, I think going forward there may be some there will definitely be longer term heading into next year be some improvements in CACs. You know, in the shorter term, as we haven't seen, you know, Q3, and Q4, and certainly would expect CAC levels to be pretty comparable to where we've driven them today, we've actually driven them from pretty, very cost effective and very cost efficient levels. In fact, most companies in the second quarter experienced massive increases in their marketing and had to dial back on the amount of growth investments. On the other hand, what our approach has been, we've been able to significantly optimize our media. And we believe that that's obviously one of our strong suits, direct to consumer acquisition, and we redeployed capital and reinvested back into sales and marketing expense in order to go out and grab market share, which is only going to lead to more significant revenue growth in the future, and ultimately, profitability growth, how we should think about sales and marketing expense going forward is I would expect over the next couple of quarters to see sales and marketing as a percent of revenue to be fairly comparable to where we are today, possibly a little bit better than the next one to two quarters. But the reality is, we have the ability to acquire new customers, patients and very efficient levels of pay back in a very quick period of time, we're going to invest and go after that. The market size that we're going after is approaching a $1 trillion. So there's a tremendous amount of opportunity for us to leverage those strengths and capabilities. Whereas, you know, we've definitely seen companies that you know, have to go the other direction and certainly pull back on their advertising spend which long term goals catch up with you as far as acquiring new patients, and then retaining those customers.

Thanks, Mark. Thanks for taking my questions. Good luck going forward and congrats on progress.

And our next question will come from [indiscernible] of BTIG.

Good afternoon guys. This is Mikael in for David Larsen. Thanks for all the clarifications and progress. Just a couple questions on my side. Maybe we can start with Nava and sort of a launch. I know you mentioned that the two to four month payback period. But maybe you can just better frame you know how the membership volumes have been looking there. You know how you're thinking about the overall market potential there and sort of a sense of your margin profile for that business.

Yep, so this Marc. So now, you know, in general, we launched aggressive marketing in second quarter, we obviously launched the business in the first quarter but took a little bit of time to get some certification. So we started going to market around halfway through the second quarter. We saw strong patient perception but what we've done is the initial traffic that we were running through that particular brand list in the first couple of months, we've relaxed that at this point, cap the amount of traffic so we're seeking to acquire a certain amount of patients we calculate a percentage of that per day and every single day that we went to market going through that we could have easily exceeded those caps. But we wanted to obviously get a read on the rebuilds, which started to trickle in, in the month of July, what I can say is, we've obviously seen strong initial rebuild numbers coming out of the brand, very strong patient acquisition numbers, double digit tax that were the lowest that we've seen across any brands in the portfolio, and tax that enabled our pharmacy to pay back in that three to four month timeframe. As far as going forward this market has tremendous potential, it can be even larger than the [indiscernible] market, which is already multi $100 billion Tam [ph]. So you know, we think looking ahead over the next 12 to 24 months, that there's no reason that this business can't be along the lines, the size of whatever x business can be possibly bigger, possibly a little bit smaller. But it's a little hard to say exactly what it will be other than we know that we have a brand that can be really big.

Got it. Thank you for that, and maybe just on your primary care solution launch this fall, if you can just maybe, you know, frame some of your membership growth potential there and how you're going to be really leveraging your partnerships with active health and particle health as well, to really grow that business and that differentiation, so would be helpful to get more context there.

Yeah, this is Justin, I'll comment on that. No, I mean, anytime we launch something, we're you know, we're going to be conservative out of the gate, the, the technology platform that we've built for life, and B and our subscription based primary care offering is incredible. It's the best technology they've ever built, it's the first, we're launching iOS and Android, mobile apps, as well. And so we're intentionally going to onboard patients in a conservative manner. So I don't know whether that's 25, 50 patients a day, initially for the first month or two. But, you know, it's a little premature, I think, to give estimates on the growth, but I think what I'm okay saying is, like, we're going to be, you know, conservative throughout the fall with putting patients on the platform, we have a lot of new providers that we've affiliated providers that we've brought on board for our life and be offering, a lot of these new technology, partnerships, new technology of our of our of our own. So we're going to be conservative with it, but we're really excited to really excited to demonstrate this to the markets this year, hey this is scaling, and we've on boarded sufficient number of patients to really prove this out and hopefully we can show by the end of the year that this is going to be a very big business and a meaningful part of the LifeMD story moving forward.

Got it. And maybe just one last one, to kind of elaborate on some of the improvement in CAC that you guys have been seeing over the last couple quarters, you know, just your thoughts on that flowing into kind of the EBITDA margins and sort of starting to see greater improvement on that front. And, you know, maybe when you sort of expect that you might hit breakeven as well, on that front.

Yeah, this is Marc. So, you know, as I've indicated on the call, we expect to be hitting EBIDTA breakeven by the end of 2022. And starting to see some leverage improvements in 2022. As far as the CAC improvements flowing it into EBIDTA margin over the next one to two quarters, we do not expect to see improvements in EBIDTA margin over the next quarter with some slight improvements and the fourth quarter of this year. And the reason for that is while we're able to improve CAC and significantly increase our efficiencies, I think we showed them the second quarter, we're able to do that and also acquire more new customers that we're able to retain very well and earned terrific unit economics on so in the short term, we're going to reinvest and redeploy capital towards continuing to grow aggressively grow our market share, which we think will return over the long term, and really starting to pan out next year much more significant growth and if we started taking all of that to the bottom line and flowing through to improve EBIDTA margin in the short term at the expense of the next call of 12, 24, 36 months.

Thank you guys very much. Appreciate all the updates and congrats on all the progress.

And with that, everyone that does conclude today's question and answer session, I would like to turn things back to Justin Schreiber, CEO for final comments.

No final comments just thank you to everyone for participating this call, appreciate everybody support and look forward to giving you even more positive update next quarter.

And with that everyone that does conclude today's call, we'd like to thank you again for your participation. You may now disconnect.