Good morning, and welcome to TriSalus Science’s Third Quarter 2024 Earnings Conference Call. Currently, all participants are in a listen-only mode. We will facilitate a question-and-answer session toward the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to your host, Jim Young, Senior Vice President of Investor Relations and Treasurer at TriSalus for a few introductory comments.

Thank you all for participating in today's call. Joining me today from TriSalus Life Sciences are Mary Szela, President and Chief Executive Officer; and Sean Murphy, Chief Financial Officer. Earlier this morning, TriSalus released financial results for the third quarter ended September 30, 2024. A copy of the press release is available on TriSalus' website. Before we begin, I would like to remind you that we will be making forward-looking statements based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. Please see the risk factors in our SEC filings for additional details. And with that, I'll turn the call over to Mary.

Good morning, everyone, and thank you for joining us today. I'm pleased to report that TriSalus has delivered a quarter of strong growth and that we continue to execute the key initiatives that will enable us to continue this upward trajectory. With our expanding market footprint, innovative product launches and strategic clinical advancements, we're on track to drive sustained growth of 50% annually for the foreseeable future. For Q3, TriSalus reported a total revenue of $7.3 million, reflecting a 42% growth compared to the same period in 2023. Several key factors have driven this growth; new account activations, deeper penetration within existing accounts, continued education around our permanent, TriNav specific reimbursement, and compelling clinical data supporting the use of TriNav in treating complex patients. On the commercial side, TriSalus has been steadily expanding its footprint across all high volume markets. By the end of the year, we expect to have approximately 50 commercial personnel via a mix of sales and clinical specialists. Our goal is to establish comprehensive coverage of high procedure markets. This expansion is central to our confidence in sustaining 50% annual growth over the coming years. I'll turn the call over to Sean Murphy, our Chief Financial Officer, for a detailed review of our financial results later in the call. Our commitment to engaging the interventional radiology and hospital communities remain strong. We continue to share the growing body of clinical evidence, showcasing value of our PEDD technology in delivering more targeted therapy to tumors, especially in complex patient cases. As we approach the year-end, I want to draw your attention to the important catalysts we're focused on. The launch of TriNav Large, clinical initiation our PROTECT registry trial for the use of TriNav in multimodular order by the end of the year, and new HEOR data…

Good morning, everyone, and thank you, Mary. As Mary mentioned at the top of the call, TriSalus achieved outstanding performance in third quarter of 2024, driven by the continued success of the TriNav technology in the U.S. Our revenue, solely driven by the success of the TriNav device in the U.S., reached $7.3 million in the third quarter. This sales achievement represents a substantial 42% increase, compared to the same period in 2023. Year-to-date, revenue stands at $21.2 million, reflecting a 66% growth compared to the nine months of last year. This quarter, we added 42 net new hospital accounts, and our utilization rose to 15.3 units per account, up from 13.5 units per account in the third quarter 2023. TriSalus has a track record of growth, illustrated on Slide 1. Since our product launch in 2020, the company has achieved a compound annualized growth rate exceeding 50%. We project, 2024 sales to grow by more than 50%, reaching $28 million to $30 million. In the third quarter of 2024, we maintained a robust gross margin of 86%, consistent with year-to-date margin, and up from 84% for the nine-month period in 2023. This margin strength is due to increased production volumes, improved batch yields and operational efficiencies. Our Westminster, Colorado facility has already produced more TriNav units in the first three quarters of 2024, than all of last year. In R&D, expenses for the third quarter and year-to-date totaled $4.2 million and $14.7 million, down 56% and 33%, respectively, compared to the same period in 2023. These reductions reflect the completion of patient enrollment in the PERIO Phase Ib trials with further decreases anticipated throughout the remainder of the year. Our investment in sales and marketing continue to increase in support of our growth strategy. In Q3 and year-to-date, we…

Thank you, Sean and thank you to everyone for joining today's call. As we wrap-up, I want to reiterate that we're highly encouraged by the strong momentum we've seen this quarter. The solid financial performance, key upcoming product launches, and strategic milestones we've discussed today demonstrate TriSalus' ongoing commitment to delivering innovative, life-changing solutions for our patients and creating long-term value for our shareholders. Looking ahead, we're on track to achieve our goal of over 50% revenue growth in 2025, underpinned by the successful rollout of TriNav Large, TriNav 2.0 and key clinical trials like the PROTECT registry. We're also excited about our progress with nelitolimod and the potential for a partnership and collaborations in oncology. As we continue to execute our growth strategy and invest in our future, we remain confident in our path to achieving EBITDA positivity in 2025, positioning us for sustained growth and success in the years ahead. Once again, thank you for your continued support. We look forward to keeping you updated on our progress and achieving new milestones together. Have a great day.

Thank you. [Operator Instructions] One moment please. And our first question comes from the line of Jason Wittes with ROTH. Q – Jason Wittes: Hi. Thanks for taking the questions. Maybe to start, in terms the guidance, definitely appreciate you providing 2025 guidance. In terms of what's in those assumptions, I guess, two questions related to that. One, is that primarily going to be taste and tear? Or can we anticipate adoption into other areas to drive that revenue? And then secondly, is there any PERIO-01, so PERIO-01 to 03 costs associated with next year in those cost assumptions?

Thank you for the question, and thank you for the coverage you initiated. Very appreciative of that. In terms of our guidance for next year, our sales force is primarily targeted in the taste and tear market. So our operating assumptions are only to capture those accounts. However, even in the current year, we are getting early usage and a few other areas that we're doing our registry in, our lieu fees. We have some thyroid cases being done. And so it's difficult to quantify the amount of it. I would expect that it is very, very small at this level. Q – Jason Wittes: That's fair. And then in terms of the cost, and I guess if I could add a question to that, in terms of advancing nelitolimod, are you going to seek a partner for all the indications, at least that you're looking at right now? Or is that something you're going to take on by yourself?

At this point, Jason, we won't know until we talk to partners. We've had a few inquiries on our plans, and we've been quiet on it until today, when we've announced that we are going to partner uveal rather than taking it forward – so – go ahead. sorry Q – Jason Wittes: I just meant that specific to uveal, the other two indications you make out alone, is that still not to be decided?

On PERIO-02 for HCC and the other indications that we were looking at, we are not going forward with that. It is to be investigator programs that we would support, but we are not doing any formal programs in PERIO-02. And then PERIO-03, as Mary mentioned, we did increase our enrollment over our target in PERIO-03 later in this year, which we will not get the full data set until mid next year, and then we will make a decision there. But the question you asked was, would a partner demand all indications, given that this is a product used in the hospital, the same channels, pretty much the same users, I would expect that to be raised. But given that we haven't advanced our data set on pancreas, while we're partnering it, it may be something that's left open.

Okay. Thanks for the color, Sean. Maybe I'll ask one more and then jump back in queue. And that's terms of the pancreatic retrofit venous infusion system, is there any advancement in terms of reimbursement for that? Or anything we can expect in terms of milestones regarding the reimbursement or adoption?

Yes. This is Mary. That's a great question. We're right in the middle of submitting for our Category 3 code. We'll do that in February of 2025. We just worked with the Society of Interventional Radiology. They've reviewed the entire application, and they'll be leading and supporting it with the submission. Based on the timeframes of these categories 3 codes, we expect to get approval in mid-2025. Once we have a Category 3 code and then we determine how to advance it, then we'll submit for a Category 1 code.

Great. Thanks for the detail and good quarter. Thank you everybody.

Thank you.

Thank you. And our next question comes from the line of Suraj Kalia with Oppenheimer & Company.

Mary, Sean, can you hear me all right?

Yes, I hear you fine.

Thank you for taking my question. So Mary, one question for you and one for Sean. And Sean, let me start off with you. piggybacking on Jason's question. For FY 2025, Sean, how are you thinking of utilization? I believe you mentioned Q3 was 15.3 units per site. Just walk us through your 50% year-over-year guide. Where does utilization factor into the calculus? And also how are you thinking about new store versus same-store for TriNav?

We have detailed assumptions for our plan. And on the new accounts and for the usage, our average usage from a constant customer same-store basis, our plan for next year is to increase to an average for the year of 17.5, so up about two units. And the rest of our growth is new accounts. We opened over 100 new accounts this year. And a lot of that had to do with getting permanent reimbursement in the beginning of year. We had a very, very high first quarter. And we're forecasting 50 new accounts next year in 2025. And then we have a significant increase due to training at large, which we have approximately $5 million in the forecast for that.

Got it. That's great color. Mary, one question for you, and I'll hop back in queue. Mary, multinodal goiters, right? This is my first call. And I'm curious, how do you all think within the treatment paradigm? My understanding always is, especially multinodal goiters, the non-toxic ones, right? Radioiodine and LT4 are usually the standard of care, but you're comparing it to surgery. Just kind of help us walk through the thought process here. And what should we think in terms of outcomes not only versus 3, but just in the whole treatment paradigm. Thank you for taking my questions.

Yes. We are very excited about this opportunity, to be honest with you. This was brought to us by a group of physicians, who have been using it and got very excited about what they saw. So obviously, nodules on the thyroid are quite common. And the small modules or if it's single modules are pretty much handled today by ablation. That's not the market we're pursuing. However, we do have a physician who wants us to use ablation and our technology together to shrink the nodule. But multinodular goiters can be treated with iodine. It's not an optimal treatment. What it's typically is surgery. And that's -- if you look at all the claims data, it's primarily surgery in the US. In other parts of the world, they'll use iodine, but they don't do that typically here. And the challenge with surgery is, this is a pretty invasive procedure. The risk of stroke and nerve damage is reasonably high. And there's also the possibility of damaging the thyroid tissue or intervening too much in thyroid tissue where there is long-term levothyroxine replacement. I managed [indiscernible] for AbbVie long ago, and it's been a long time in what it means to get a patient is thyroid. So, there's a lot of complications associated with it. And what physicians are seeing with our technology is previous embolizations, they had to go into the subclavian, which obviously had some risk of stroke, and that really frightened physicians from using just traditional catheters to do this procedure. What we can do with ours because of the ability to retrograde fill the tumor, we go into the inferior thyroid arteries only. We don't go into the sub [indiscernible] or the carotid [ph] arteries at all, and it's about a 30-minute, 25-minute procedure. You can…

Excellent. Many thanks.

Thank you. And our next question comes from the line of William Plovanic with Canaccord Genuity.

Great. Thanks. Good morning. Thanks for taking my questions. So just to start out on 2024 guide, commentary that greater than 50%, I think consensus was sitting at $8.2 million. Just wanted to get your comfort level with that as we use for a jump-off point for 2024 or 2025?

Bill, this is Sean. Yeah, that is a very good number. And for the full year, we've announced that the range is between $28 million and $30 million.

Okay. And then just as we think about it, I mean, it's difficult for companies to get their third, fourth year post commercialization to really hit seasonality, and you expected this and we saw this pretty much flat sequentially. But I was wondering, if you could just give us some color as to maybe monthly cadence as you went through July, August, September and into October, just to give us confidence in that fourth quarter rebound? And any other puts or takes that you're seeing as we go into the end of the year here?

Sure, Bill. Yes, I've been in this position for three cycles now, the third one. And I'm still trying to find a standard cadence during the year. It varies. I do believe remnants of COVID made it quite different, my first year here. And it is getting back to what I would have expected. So in the third quarter, we were flat with the second quarter, but the month-to-month was quite different. In the summer months of July and August, we saw a very low utilization, not a lot of cases. And we were a bit concerned about that. And then in September, it was the biggest month we ever had. It was bigger by 10% to 15% over the previous biggest one, which I think was a year-end close. And so the pattern was a bit unusual. And the other part of looking at it year-to-year. In the third quarter of 2023 is right after we went public, we added a number of salespeople. And that particular quarter was -- which on our chart was a very, very high quarter. So we have a tough comp, but we did see a dramatically different utilization in July and August than we've seen in prior years.

Okay. And then just help us understand, I think you burned about $11 million in the third quarter. You finished the quarter with $11 million. You talked about kind of dropping the spend and pulling another $10 million in Q1 to kind of -- and you believe you'll be able to get there. I mean, is this just -- you expect a lot of decrease in the R&D sequentially? And then even maybe on the G&A, was there a risk? Was there -- is there something else going on that you'll be able to drop the spend that much?

It's mostly consultants, lawyers and accounting firms. We did so many registrations. We did so many S-1s, S-4s. We incurred a lot of costs coming out of a de-SPAC process. So in the second quarter, we saw a leveling off of our G&A administrative public company costs. In the third quarter, it went down pretty substantially. We expect that to continue to go down quarter-to-quarter as we just don't have to do the filings that we've had to in the past. We've also we're involved in a number of banking activities that affected our G&A to a certain degree. And so we're on a drop. But the biggest change is just finishing up our PERIO trials. They're expensive trials, and we're -- we've enrolled our last patient this particular quarter. And besides that, most of those clinical costs get transferred into doing closeout at facilities, filing various reports on the patient follow-ups and so forth, which are administrative -- more administrative activities internally. And so our use of consultants, CROs drop very, very much. And so you are right. Our cash burn in the third quarter was a tad over $11 million. We expect the fourth quarter to be down in the range of $4 million to $4.5 million. And that cash burn will continue to drop until we're at a point where in the second half of next year, we will be cash flow positive.

Great. And then my last question, just the PERIO update, it's interesting. So what should we read into these comments in terms of pancreas regarding efficacy? You've added more patients. You pushed out the readout until mid next year. I mean what's the takeaway? We see it safe, but we're not really clear on efficacy. I mean what's the messaging you're trying to give us here? And thanks for taking my questions.

Sure. So we enrolled in the fourth quarter, three more patients for a total of 13. And what we're trying to do is just get longer follow-up period, so we get more than 10 patients in total data. One of the other things that we're just assembling now, Bill, and I think this is really going to give us kind of the confidence in terms of how we move forward, is what was really unusual in this trial, we were able to get quite extensive tissue samples pre and post of the administration of nelitolimod. We just got all those samples now. And so what we're doing is we're going through that data with a panel of immunologists and some oncologists to sort through that because this wasn't a randomized clinical trial. So what we really want to see is, are we modulating the tumor microenvironment in the way that we think. And the positive results that we've seen, can we attribute them completely to nelitolimod, and that's really what we need to do. And we won't really have all that data of the last few patients and follow-up probably until March or April. So that's why we think middle of the year is the right We still remain very enthusiastic about it. I think what we need to do is see that correlative data and make sure that it's consistent with where we're reading the data today. Makes sense?

It does. Thanks.

Thank you. And our next question comes from the line of Justin Walsh with JonesTrading.

Hi, thanks for taking the question. I'm wondering if you can comment on the intersection of TriNav and TriNav Large target markets. How many physicians are likely to use one versus the other or both?

So that's a great question. We got a lot of clarity on that this year as we started to grow. So physicians, each physician will probably use both. How TriNav Large is used and how TriNav is used is really just pertains to vessel size. Oftentimes, the physician doesn't really know until they get into the procedure room and they see where they want to go and they see the vessel size, they'll kind of eyeball it and determine what product to use. One of the challenges that we had this year without having TriNav Large is we have TriNav, but then they looked at the vessel size and said, "Hey, I can't get in with the TriNav. I need a larger vessel one," and we lost that opportunity for TriNav. So we estimate that we were not getting access to about 30% of the taste and tear market. So now we have a full portfolio. So every physician uses both because they have patients that have vessel sizes that range anywhere from 1.5 centimeters all the way up to 5. So we're very excited now to have a full suite of products for the interventional radiologist.

Got it. Makes sense. And one more question for you. I'm just curious if you can comment on the competitive landscape. If there's any other novel delivery products or catheters that you see emerging that could be competitors for TriNav or TriNav Large?

We don't see anyone in TriNav in the liver. I mean our -- one of the things that we feel very comfortable about is our new HCPCS procedural code was written specifically for our technology and how we modulate crusher and flow, which we think creates those unique favorable benefits of the technology. And then on our pancreatic device, we don't see any other competitor that accesses the venous anatomy and also uses pressure in the way that we do. There is an arterial version for accessing the pancreas that is currently in development, and I think they have a readout this fourth quarter. But in terms of having a life technology that modulates pressure, we don't see one. One of the things that we have done is create an IP around how we modulate pressure and flow. So we think we have a pretty good sense around that technology and have a nice toll booth, if anyone tries to come into our space.

Great. Thanks for taking my questions.

Thank you. I'll now hand the call back over to CEO, Mary Szela, for any further remarks.

Thank you everyone. Really appreciate your interest and support in the company. Have a great day.

Ladies and gentlemen, thank you for participating. This does conclude today's program. And you may now disconnect.