TELA Bio Inc (TELA) 2024 Q3 法說會逐字稿

Good afternoon, ladies and gentlemen and welcome to the Tela Bio third quarter, 2024. (Operators Instruction).

女士們、先生們，下午好，歡迎來到 Tela Bio 2024 年第三季。（操作員說明）。

I would now like to turn the conference over to Louisa Smith from the Gilmartin Group. Please go ahead.

我現在想將會議轉交給吉爾馬丁集團的路易莎史密斯。請繼續。

Thank you, Leonardo and good afternoon, everyone earlier today, Tela Bio released financial results for the third quarter of 2024. A copy of the press release is available on the company's website. Joining me on today's call are Tony Koblish, President and Chief Executive Officer and Roberto Cuca, Chief Operating Officer and Chief Financial Officer.

謝謝萊昂納多，大家下午好，今天早些時候，Tela Bio 發布了 2024 年第三季的財務業績。該新聞稿的副本可在該公司網站上取得。與我一起參加今天電話會議的還有總裁兼首席執行官托尼·科布里什 (Tony Koblish) 和首席營運官兼首席財務官羅伯托·庫卡 (Roberto Cuca)。

Before we begin, I'd like to remind you that during this conference call, the company may make projections and forward-looking statements regarding future events. We encourage you to review the company's past and future filings with the sec including without limitation, the company's annual report on form 10-K and quarterly reports on forms 10-Q which identify the specific factors that may cause actual results or events to differ materially from those described in these forward-looking statements these factors may include without limitation statements regarding product development and pipeline opportunities, product potential, changes in surgical procedure volumes due to various factors and conditions identified in our filings, changes in the regulatory environment and in our sales and marketing strategies, our capital resources and our operating performance.

在我們開始之前，我想提醒您，在本次電話會議期間，公司可能會對未來事件做出預測和前瞻性陳述。我們鼓勵您審查公司過去和未來向SEC 提交的文件，包括但不限於公司10-K 表格中的年度報告和10-Q 表格中的季度報告，其中確定了可能導致實際結果或事件存在重大差異的具體因素從這些前瞻性陳述中描述的因素來看，這些因素可能包括但不限於有關產品開發和管道機會、產品潛力、由於我們的文件中確定的各種因素和條件而導致的外科手術量的變化、監管環境和我們的變化的陳述。

I'd now like to turn the call over to Tony.

我現在想把電話轉給托尼。

Thanks Louisa and good afternoon, everyone. Thank you for joining Tela Bio's third quarter, 2024 earnings call Roberto and I will provide our respective updates on the quarter and review our financial results before we open the call up for your questions.

謝謝路易莎，大家下午好。感謝您參加 Tela Bio 的 2024 年第三季財報電話會議，羅伯托和我將分別提供本季度的最新情況，並在我們開始詢問您的問題之前回顧我們的財務業績。

I am pleased to report that we delivered a very strong third quarter that marked a return to growth rates across the portfolio, more consistent with what we've delivered historically. Recall last quarter, we had to work through the impact of cyber security events that affected some of our hospital customers. That effect appears confined to that period as evidenced by revenue for Q3 of 19 million. A 26% year over year increase. Demand for our portfolio of products was high with unit sales for OviTex and OviTex PRS growing 39% and 44% respectively. While our European business grew 67% from the prior year period.

我很高興地報告，我們第三季的表現非常強勁，標誌著整個投資組合恢復了成長率，與我們歷史上的表現更加一致。回想一下上個季度，我們必須解決影響我們一些醫院客戶的網路安全事件的影響。這種影響似乎僅限於這段時期，第三季的營收為 1,900 萬美元就證明了這一點。較去年同期成長26%。對我們產品組合的需求很高，OviTex 和 OviTex PRS 的單位銷售額分別成長了 39% 和 44%。而我們的歐洲業務較去年同期成長了 67%。

Global average daily sales exceeded $300,000 per day and there are now more than 700 hospitals worldwide using our products across a steadily growing GPO contract base. Additionally, we recently announced the closing of a public offering that added 43 million of cash to the balance sheet. As a result, we believe that we are amply funded to continue driving strong revenue growth and reach profitability.

全球日均銷售額超過 30 萬美元，目前全球有 700 多家醫院在穩定成長的 GPO 合約基礎上使用我們的產品。此外，我們最近宣布完成公開發行，為資產負債表增加了 4,300 萬現金。因此，我們相信我們有充足的資金來繼續推動強勁的收入成長並實現盈利。

With that overview, let me provide some additional details. Starting with the dynamic international growth we generated this quarter. Europe's performance has been particularly strong with significant market share gains in UK, Germany, the Netherlands, Austria and Switzerland along with promising early results in Spain and Portugal.

有了這個概述，讓我提供一些額外的細節。從本季我們實現的充滿活力的國際成長開始。歐洲的表現特別強勁，英國、德國、荷蘭、奧地利和瑞士的市佔率大幅成長，西班牙和葡萄牙的早期業績也令人鼓舞。

In Q3, we achieved our first million-dollar month in Europe.

第三季度，我們在歐洲實現了第一個月收入百萬美元的目標。

With OviTex firmly established as a market leader in the UK and the Netherlands supported by encouraging clinical data presented in journals and in Congresses, we are effectively adjusting to Europe's widely practiced and UK mandated model of patient or shared decision making to guide us in developing tools that better support surgeons worldwide. In this essential practice, these tools empower informed choices aligning with our commitment to patient centered care globally, the shift from polypropylene and synthetic mesh towards a more natural repair product like OviTex is steadily gaining recognition for its safety profile and clinical benefits. We have implemented multiple strategic initiatives to leverage recent shifts in the market to position OviTex as the preferred choice for surgeons and their patients. When deliberately opting out of plastic in Hernia and abdominal wall reconstruction, we sold nearly 5,000 OviTex units this quarter with 60% usage in minimally invasive procedures. Reflecting strong adoption of OviTex LPR and IHR products.

隨著OviTex 在英國和荷蘭確立了市場領導者的地位，並在期刊和國會上發表的令人鼓舞的臨床數據的支持下，我們正在有效地適應歐洲廣泛實踐和英國強制的患者或共同決策模型，以指導我們開發工具更好地支援全世界的外科醫生。在這一基本實踐中，這些工具使明智的選擇與我們在全球範圍內以患者為中心的護理的承諾相一致，從聚丙烯和合成網狀材料轉向OviTex 等更自然的修復產品，其安全性和臨床效益正在穩步獲得認可。我們實施了多項策略性舉措，以利用最近的市場變化，將 OviTex 定位為外科醫生及其患者的首選。當在疝氣和腹壁重建中故意選擇不使用塑膠時，我們本季售出了近 5,000 台 OviTex 裝置，其中 60% 用於微創手術。反映出 OviTex LPR 和 IHR 產品的廣泛採用。

Our plastic and reconstruction portfolio also saw significant growth fuelled by OviTex PRS LTR topping 6.3 million in Q3.

在 OviTex PRS LTR 的推動下，我們的塑膠和重建產品組合在第三季突破 630 萬件，也實現了顯著成長。

I am also very pleased to report we are doing a very effective job gaining, mind share among surgeons. Q3 was a standout period for Tela Bio at key society meetings, exposing us to thousands of potential surgeon customers. At the American Hernia Society meeting in Chicago, we generated significant awareness around Tela's brand and its products including by hosting a highly attended lunch symposium featuring global thought leader, Professor Maya Borr Meister from Amsterdam. Speaking about her experience with OviTex in complex Hernia repairs, we were also able to host a unique evening reception with a HS and a couple of 100 surgeons where Professor Borr Meister cap captivated everyone again with her talent. This time as DJ MB, we also continued to drive exposure in the PRS arena and sponsor the welcome reception at plastic surgery. The meeting where we were able to reinforce our commitment to innovation and partnership in plastic and reconstructive surgery to the nearly 2000 surgeons in attendance at the conference. Our meeting presence also included expanded partnership with intuitive surgical at the 360 meeting for hospital and health system leadership and the symposium at the American Forgot Society meeting where renowned former society President Reg Bell shared his insights on OviTex. Commercially, we are set to benefit from a growth strategy that is based on data driven selling across the whole portfolio. We appointed Greg Firestone; Chief Commercial Officer in May and he wasted no time making important changes to our commercial strategy that have already resulted in a more productive sales organization. Most notably, the deep PRS training and skill assessment that began in the late fall of 2023 and extended through this year has involved our salesforces balance selling across both PRS and Hernia product lines. These improvements across our training and development program have also enabled us to streamline our commercial organization with a focus on more productive quarter, carrying sales representatives and less on other auxiliary functions that have historically supported our sales organization and PRS and other highly specialized applications.

我也很高興地報告，我們正在做一項非常有效的工作，贏得了外科醫生的思想分享。第三季是 Tela Bio 在重要學會會議上表現出色的時期，使我們接觸了數千名潛在的外科醫生客戶。在芝加哥舉行的美國疝氣協會會議上，我們舉辦了一場由全球思想領袖、來自阿姆斯特丹的 Maya Borr Meister 教授參加的午餐研討會，提高了人們對 Tela 品牌及其產品的認識。當談到她使用 OviTex 進行複雜疝氣修復的經驗時，我們還與 HS 和 100 名外科醫生一起舉辦了一場獨特的晚間招待會，Borr Meister cap 教授以其才華再次吸引了所有人。這次，身為 DJ MB，我們也持續提高 PRS 領域的曝光率，並贊助整形外科的歡迎酒會。在這次會議上，我們向出席會議的近 2000 名外科醫生強化了我們對整形和重建外科創新和合作的承諾。我們參加的會議還包括在醫院和衛生系統領導層360 會議上擴大與直觀外科的合作夥伴關係，以及在美國忘記協會會議上舉行的研討會，著名的前協會主席Reg Bell 分享了他對OviTex 的見解。在商業上，我們將從基於整個投資組合的數據驅動銷售的成長策略中受益。我們任命了格雷格‧費爾斯通 (Greg Firestone)；五月擔任首席商務官，他立即對我們的商業策略進行了重大改變，這些改變已經使銷售組織變得更加有效率。最值得注意的是，深入的 PRS 培訓和技能評估始於 2023 年秋末，一直延續到今年，涉及我們的銷售人員平衡 PRS 和 Hernia 產品線的銷售。我們的培訓和發展計劃的這些改進也使我們能夠簡化我們的商業組織，重點關注更俱生產力的季度，配備銷​​售代表，並減少歷史上支持我們的銷售組織和PRS 以及其他高度專業化應用程序的其他輔助功能。

We are already seeing those benefits and believe the strength of performance in the third quarter is indicative of early success and sustain sustainable growth. Moving forward as we continue to evaluate and evolve our teams to support a more efficient commercial organization.

我們已經看到了這些好處，並相信第三季的強勁業績表明了早期的成功和可持續的可持續成長。我們不斷評估和發展我們的團隊，以支持更有效率的商業組織，並不斷前進。

From a financial perspective. We have also made notable progress. We implemented changes in the third quarter that will annualize to approximately 5 to 10 million in OpEx reduction with some of the savings expected in the fourth quarter and the full impact manifesting in 2025. These changes in conjunction with the recent public offering that added 43 million in cash to our balance sheet should allow us to reach break-even while maintaining a solid growth trajectory. I look forward to speaking less about our balance sheet and more about operational performance in the coming quarters. I'll now turn the call over to Roberto to review our financial results in more detail.

從財務角度來看。我們也取得了顯著進展。我們在第三季實施了變革，預計營運支出每年將減少約 500 至 1,000 萬美元，部分節省預計將在第四季度實現，全面影響將在 2025 年顯現。這些變化加上最近的公開發展行為我們的資產負債表增加了 4,300 萬美元現金，應該能讓我們在保持穩健成長軌跡的同時實現收支平衡。我期待少談論我們的資產負債表，多談論未來幾季的營運表現。我現在將把電話轉給羅伯托，以更詳細地審查我們的財務表現。

Thanks Tony.

謝謝托尼。

As Tony mentioned revenue for the third quarter of 2024 grew 26% year over year or nearly $4 million to $19 million with revenue from OviTex growing 23% and OviTex PRS growing 31%. Gross margin was 68% for the third quarter compared to 69% in the prior year period. The decrease is primarily due to a higher charge for excess and obsolete inventory as a percentage of revenue sales and marketing expense was $16.5 million in the third quarter of 2024 compared to $14.5 million in the same period in 2023. The increase was primarily due to increased compensation costs including increased severance costs and additional consulting and travel expenses.

正如東尼所提到的，2024 年第三季的營收年增 26%，近 400 萬美元至 1,900 萬美元，其中 OviTex 的營收成長 23%，OviTex PRS 的營收成長 31%。第三季毛利率為 68%，去年同期毛利率為 69%。這一下降主要是由於過剩和過時庫存費用較高，2024 年第三季銷售和行銷費用佔收入的百分比為 1,650 萬美元，而 2023 年同期為 1,450 萬美元。這一增長主要是由於補償費用增加，包括遣散費以及額外的諮詢和差旅費用增加。

General and administrative expense was $3.7 million effectively flat when compared to the same period in 2023. R&D expense was $2.1 million in the third quarter compared to $2.4 million in the prior year period. The decrease was primarily due to lower study and development costs which offset higher compensation and benefits. Loss from operations was $9.4 million in the third quarter of 2024 compared to $10.2 million in the prior year period. Net loss was $10.4 million in the third quarter of 2024 compared to $11 million in the same period in 2023.

一般及管理費用為 370 萬美元，與 2023 年同期相比基本持平。第三季研發費用為 210 萬美元，去年同期為 240 萬美元。下降的主要原因是研究和開發成本降低，抵消了薪酬和福利的提高。2024 年第三季營運虧損為 940 萬美元，而上年同期為 1,020 萬美元。2024 年第三季的淨虧損為 1,040 萬美元，而 2023 年同期淨虧損為 1,100 萬美元。

As we disclosed previously, we still expect operating loss and net loss to be less in 2024 than in 2023. Even excluding the impact of the NVIS divestiture, we expect operating expenses will be lower sequentially in the fourth quarter, as cost saving efforts expected to reduce 2025 OpEx by $5 million to $10 million from annualized first half of 2024 OpEx begin to kick in.

正如我們先前所揭露的，我們仍然預計 2024 年的營運虧損和淨虧損將低於 2023 年。即使排除 NVIS 剝離的影響，我們預計第四季度的營運支出將環比下降，因為成本節約工作預計將比 2024 年上半年年化營運支出減少 500 萬美元至 1000 萬美元。

We ended the third quarter with $17.3 million in cash and cash equivalents. After the end of the quarter, we conducted a public equity offering resulting in net proceeds of approximately $43 million.

第三季末，我們擁有 1,730 萬美元的現金和現金等價物。本季末後，我們進行了公開股票發行，淨收益約為 4,300 萬美元。

Turning to the outlook for 2024 with the strong return to growth in the third quarter, we remain on track to achieve our previously issued full year revenue guidance of from $74.5 million to $76.5 million reflecting growth of 28% to 31% over 2023 across that range. This estimate does not include the potential effects of IV fluid shortages resulting from recent natural disasters. We are carefully monitoring elective procedure volumes for evidence of disruption and to enable potential remedial actions. But as of yet have been unable to detect a meaningful impact. I'll now hand the call back to Tony for closing remarks.

展望 2024 年，隨著第三季強勁恢復成長，我們仍有望實現先前發布的 7,450 萬美元至 7,650 萬美元的全年營收指引，反映出該範圍內比 2023 年增長 28% 至 31% 。這項估計不包括近期自然災害造成的靜脈輸液短缺的潛在影響。我們正在仔細監控選擇性手術量，以尋找中斷的證據並採取潛在的補救措施。但到目前為止還無法檢測到有意義的影響。現在我將把電話轉回給托尼，讓他作結束語。

Thanks Roberto. In closing Q3 has been an exceptional quarter for Tela Bio both financially and operationally as we continue to accelerate our momentum in Hernia and PRS while reinforcing our leadership in innovation and surgeon education. From achieving record breaking average daily sales to crossing the milestone of our first million dollar a month in Europe. We continue to drive growth across markets and deliver on our mission. I have never been more confident in our prospects to establish OviTex and OviTex PRS as the leading technology in soft tissue preservation and restoration. What is most exciting is that we are just getting started as most of the market remains up for the taking.

謝謝羅伯托。最後，第三季度對於Tela Bio 來說無論是在財務上還是在營運上都是一個出色的季度，我們繼續加速在疝氣和PRS 領域的發展勢頭，同時加強我們在創新和外科醫生教育方面的領導地位。從平均每日銷售額破紀錄到跨越歐洲每月首個百萬美元的里程碑。我們繼續推動跨市場的成長並履行我們的使命。我對將 OviTex 和 OviTex PRS 打造成軟組織保存和修復領域領先技術的前景充滿信心。最令人興奮的是，我們才剛開始，因為大部分市場仍有待佔領。

Lastly, I want to speak directly to Tela Bio's employees both here in Malvern and in the field, our commercial team. I'd like to thank you and acknowledge your dedication, tenacity, unity, and resilience in overcoming the headwinds in prior quarter Q2 and delivering an exceptional Q3. We thank you very much. It was a great effort, and we look forward to continuing the path for future success. So, with that, I'll now ask Leonardo to open the line for questions. Please, go ahead.

最後，我想直接與 Tela Bio 在馬爾文和現場的員工以及我們的商業團隊交談。我要感謝你們，並認可你們在克服上一季第二季度的不利因素並實現出色的第三季度中所表現出的奉獻精神、堅韌、團結和韌性。我們非常感謝你。這是一項巨大的努力，我們期待著繼續邁向未來的成功之路。因此，我現在請萊昂納多開通提問熱線。請繼續。

Thank you. We will now begin the question-and-answer session. (Operators Instructions). Your first question comes from the line of Caitlyn Cronin of Canaccord. Please go ahead.

謝謝。我們現在開始問答環節。（操作員說明）。你的第一個問題來自 Canaccord 的 Caitlyn Cronin。請繼續。

Hey guys. Congrats on a great quarter.

嘿夥計們。恭喜您度過了一個出色的季度。

Thanks.

謝謝。

Yeah. You know, just to start off, can you provide a little more colour on the 5 to 10 million in OpEx savings? You know, where are these coming from? And are these savings, you know, just for the Q4 and 2025 or sustainable beyond that?

是的。首先，您能否為 500 到 1000 萬營運支出節省提供更多資訊？你知道，這些是從哪裡來的？您知道，這些節省僅適用於第四季和 2025 年，還是永續的？

So, thanks for the question, Caitlyn, I'll start off and Tony can jump in. So the primary source of the savings are headcount reductions that we implemented in the first part of the third quarter. So we began a more intensive training on PRS selling for our sales force about a year ago at the behest of our, our now Chief Commercial Officer Greg Firestone. As our sales force became more adept at selling across the portfolio, so both Hernia products and PRS products and relied less on clinical development specialists to assist them in the PRS sales. In specific, we were able to redeploy some of those more expensive clinical development specialists and also reduce the total size of that force as well as some other supportive heads. So, Greg talks about our sales and marketing organization being broken into doers and helpers, where doers are the people who carry the quotas and everyone else is a helper. So we're able to reduce our reliance on helpers. While keeping the focus on quota carrying sales reps. We believe that those reductions are steps that, you know, we'll be able to carry them from the 2025 into 2026 as well. And as Greg continues to take a look at the sales organization and there could be other places where we can become more efficient.

所以，謝謝你的提問，Caitlyn，我先開始，Tony 可以插話。因此，節省的主要來源是我們在第三季上半年實施的裁員。因此，大約一年前，在現任首席商務官格雷格·費爾斯通 (Greg Firestone) 的要求下，我們開始對我們的銷售人員進行更密集的 PRS 銷售培訓。隨著我們的銷售人員變得更加擅長銷售整個產品組合，因此疝氣產品和 PRS 產品都不再依賴臨床開發專家來協助他們進行 PRS 銷售。具體來說，我們能夠重新部署一些更昂貴的臨床開發專家，並減少該部隊以及其他一些支援負責人的總規模。因此，格雷格談到我們的銷售和行銷組織被分為實幹者和幫助者，其中實幹者是承擔配額的人，其他人都是幫助者。所以我們能夠減少對幫助者的依賴。同時將重點放在持有配額的銷售代表。我們相信，我們也能夠將這些削減措施從 2025 年延續到 2026 年。隨著格雷格繼續審視銷售組織，我們可能還有其他地方可以提高效率。

Great and then just, you know, turning to revenue for the quarter. Did you recover procedures from the cyber-attack challenges in Q2? And how much of the revs in Q3 were related to the clearing of that backlog?

很好，然後，你知道，轉向本季的收入。您是否從第二季度的網路攻擊挑戰中恢復了程式？第三季的轉速有多少與積壓訂單的清理有關？

Yeah, I mean, I think from our COVID experience, Caitlyn, we just never see a backlog, load up and, and then flow through the system. In Hernia, it just seems like the procedures fade and then come back to more normal levels and, and I think that's what we saw here. There was really know that we could discern, you know, load up of patients that entered the system into Q3. I actually think that through the cyber hack problems at the one GPO, those patients might have actually been rerouted to other places, perhaps where we don't have customers or we don't have, you know, a footprint. So, you know, I don't think all of those patients were you know, reallocated, but I think somewhere. And Hernia just seems to be you know, one of those Quasi elective procedures where watchful waiting is part of the treatment algorithm anyway. So, plus or minus a quarter or two for most procedures is probably very much doable, in the cycle of treatment. So I, I don't think we saw much of a load up from Q2.

是的，我的意思是，凱特琳，我認為根據我們的新冠疫情經驗，我們從來沒有看到積壓、加載、然後流經系統。在疝氣中，手術似乎會逐漸消失，然後又恢復到更正常的水平，我認為這就是我們在這裡看到的情況。我們確實知道，我們可以識別進入第三季系統的患者數量。我實際上認為，由於某個 GPO 的網路駭客問題，這些患者實際上可能已被轉移到其他地方，也許是我們沒有客戶的地方，或者我們沒有足跡的地方。所以，你知道，我不認為所有這些病人都被重新分配，但我認為在某個地方。疝氣似乎就是你知道的，一種準選擇性手術，無論如何，觀察等待都是治療演算法的一部分。因此，在治療週期中，對於大多數手術來說，加或減四分之一或兩個可能是非常可行的。所以我認為我們從第二季開始並沒有看到太多的負載。

Yeah. And I ask Caitlin, you know, we don't think that the Q3 would boost by.

是的。我問凱特琳，你知道，我們認為第三季不會有所提升。

A backlog.

積壓。

From Q2 because in order for that to have happened, you would have had to see a great, a higher rate of procedures at the affected hospitals in Q3 than you saw in Q1. And what we really saw was that the rate was returning to the pre disruption level.

從第二季開始，因為要實現這一目標，您必須看到第三季受影響醫院的手術率比第一季更高。我們真正看到的是，利率正在恢復到中斷前的水平。

Got it makes sense. Thanks guys.

明白了，很有道理。謝謝你們。

Thanks, Caitlyn.

謝謝，凱特琳。

Your next questions comes from the line of the Canyon of Lake Street Capital Market. Please, go ahead.

您的下一個問題來自湖街資本市場峽谷線。請繼續。

Great. Thanks for taking the question. Congrats on the quarter. Maybe it was going to start with talking a little bit about 2025. I'm sure there's a little reluctance to speak to too much detail about it, but maybe initial thoughts as we enter the year into 2025 how we're thinking about growth, I think consensus right now is in the 25% range, any reaction to that and any thoughts around that growth profile.

偉大的。感謝您提出問題。恭喜本季。也許應該從談論 2025 年開始。我確信大家有點不願意談論太多細節，但也許當我們進入 2025 年時我們如何考慮增長的初步想法，我認為現在的共識是在 25% 的範圍內，任何反應對此以及圍繞該增長概況的任何想法。

So we haven't provided guidance for 2025 yet. We typically do that on our fourth quarter earnings call. We are guiding to 26% to 31% growth for this year, 25% is a little below that. You do see that as a company matures, the growth rate can throttle back. Obviously, that's just below the lower end of the current range for this year a year where we had the second quarter disruption. So I don't think it's out of line in any, any direction, but as we complete our own budgeting process internally and then get into the fourth quarter earnings call, we'll provide an update on what our expectations are for next year.

所以我們還沒有提供 2025 年的指導。我們通常會在第四季的財報電話會議上這樣做。我們預計今年的成長率為 26% 至 31%，25% 略低於此水準。你確實看到，隨著公司的成熟，成長率可能會放緩。顯然，這略低於今年第二季中斷的當前範圍的下限。因此，我認為這在任何方向上都沒有出格，但當我們在內部完成自己的預算流程並進入第四季度的財報電話會議時，我們將提供有關明年預期的最新資訊。

Got it. That's helpful. And then maybe swinging back to some of Tony's prepared remarks on the international front, sounds like things are going really well there. What can you extrapolate from that market and apply to the US market, especially in light of some of the synthetic settlements that are occurring and maybe the trend away from synthetics.

知道了。這很有幫助。然後也許回到托尼在國際方面準備好的一些言論，聽起來事情進展得非常順利。您可以從該市場推斷出什麼並將其應用於美國市場，特別是考慮到正在發生的一些合成解決方案以及可能遠離合成的趨勢。

Yeah. Thanks for that. I think, I think it's an interesting thought experiment. You know, if you look at the UK and the NHS, you know, they've, they've put together a program called Get It Right the first time. And you know, there is this collaboration that the NHS is driving between surgeons and patients to have almost a consent process or a shared decision-making process on the mode of treatment.

是的。謝謝你。我認為，我認為這是一個有趣的思想實驗。你知道，如果你看看英國和 NHS，你就會知道，他們第一次製定了一個名為「Get It Right」的計劃。你知道，NHS 正在推動外科醫生和患者之間的合作，以就治療模式達成幾乎一致的過程或共同的決策過程。

And certainly, a mode of treatment for Hernia repair is, you know, what type of mesh is the patient comfortable with? And what kind of mesh is the surgeon comfortable with? And I think this shared decision-making model has been something we have used here in the US. Quite a bit. And I think we've actually published a little bit of data on that, that shows that you know, if you show all the different samples of product out that are available, whether it's permanent plastic or temporary plastic or biologic or our reinforced tissue matrix that, you know, well into the 90% time the patient will have a conversation with the surgeon about our product.

當然，疝氣修復的一種治療模式是患者對哪種類型的網片感到舒適？外科醫生對什麼樣的網片感到滿意？我認為我們在美國已經使用了這種共同決策模式。相當多。我認為我們實際上已經發布了一些相關數據，這表明您知道，如果您展示可用的所有不同產品樣品，無論是永久塑料、臨時塑料、生物製品還是我們的強化組織基質您知道，90% 的時間患者都會與外科醫生討論我們的產品。

So, it seems to be an effective way to get everybody educated on natural repair with the reinforced tissue matrix. And I think we're seeing a little bit of that taking effect in the UK, which is a country that is the size of the UK. And so, you know, if we extrapolate that model becoming more popular and more, you know, used in the US with 350 million people, you know, I think it shows that we are heading in the right, we are in the right place for where this market is heading. I think it's unquestionably clear that there will come a day where permanent plastic is less implanted in the US than it is today. I think it's probably 80% of all implants that go in today, believe it or not, even with, you know, some of the litigation and settlements that have, that have played out of size of considerable size.

因此，這似乎是讓每個人接受強化組織基質自然修復教育的有效方法。我認為我們正在看到這種做法在英國產生了一些影響，英國是一個面積與英國相當的國家。所以，你知道，如果我們推斷模型會變得更流行，並且在擁有3.5 億人口的美國得到更多使用，你知道，我認為這表明我們正朝著正確的方向前進，我們正處於正確的位置了解這個市場的發展方向。我認為毫無疑問的是，終有一天，美國植入的永久性塑膠將比今天更少。不管你信不信，我認為今天所有植入物中可能有 80% 是這樣的，即使有一些訴訟和和解，其規模已經達到了相當大的規模。

So that's going to change over time. I think it's just the natural force of innovation and evolution. And if a shared decision-making model similar that's coming out of the NHS and the UK gain some traction here, it's going to be great for us. But certainly, you know, the shift towards natural repair is going to be great for us. We're, sitting in a good spot over the next I'd say five years.

所以這會隨著時間的推移而改變。我認為這只是創新和進化的自然力量。如果 NHS 和英國推出的類似共享決策模式在這裡獲得一些關注，這對我們來說將是一件好事。但當然，你知道，向自然修復的轉變對我們來說將是一件好事。我想說，在接下來的五年裡，我們將處於一個有利的位置。

Got it. Okay.

知道了。好的。

That's helpful. Thanks for taking the questions.

這很有幫助。感謝您提出問題。

Thanks, Brian.

謝謝，布萊恩。

(Operator Instructions). Your next question come from the line of Michael Sarcon of Japariz. Please, go ahead.

（操作員說明）。你的下一個問題來自 Japariz 的 Michael Sarcon。請繼續。

(Inaudible). You're seeing so far through the fourth quarter to date.

（聽不清楚）。迄今為止，您所看到的是第四季度。

Sorry, the first part of your question cut out through. Can you repeat it?

抱歉，您問題的第一部分被刪掉了。你能重複一下嗎？

Oh, yeah, sure. Was just curious what kind of trends you're seeing so far in the fourth quarter? And you know, should we expect that over tech? IHR is going to continue to, to grow pretty rapidly and, and we continue to see some of those mix shifts drive ASP pressure.

哦，是的，當然。只是想知道第四季度到目前為止您看到了什麼樣的趨勢？你知道，我們應該期待這一點超過科技嗎？IHR 將繼續快速成長，並且我們將繼續看到其中一些組合變化帶來平均售價壓力。

Yes. So, you know, we talked about in our last call the 1st month of the quarter looked like because there's some concern about whether disruption was lagging over into the third quarter from the second quarter. We are seeing a similar progression in the fourth quarter, meaning that October is a record high 1st month of a quarter for us. Suggesting that we're on track to hit the fourth quarter numbers that we need to hit to get to our guidance. And then the second part of your question was.

是的。所以，你知道，我們在上次電話會議中談到了本季第一個月的情況，因為有人擔心中斷是否會從第二季落後到第三季。我們在第四季度看到了類似的進展，這意味著 10 月是我們季度第一個月的歷史新高。這表明我們有望達到第四季度的數字，我們需要達到這個數字才能達到我們的指導。然後你問題的第二部分是。

IHR and Price pressure. Yeah. So, you know, I think IHR is off to a good start. We're only about a quarter into that roll out. I think, you know, as the volume goes up there, there's going to be some puts and takes Michael, right? So, you know, IHR volume could bring ASP generally down. But our encouragement of balanced selling is going to mean that we want to go after, you know, all of the different Hernia's that are out there, including ventral's and complex ab walls, which is where we got our start quite successfully. So, you know, it stands to reason that you know, as our ventral and complex users get into IHR, IHR will grow and as new users develop an interest and start using IHR hopefully, our ventral and complex products will grow. So, there may be a little bit of a put and take on ASP depending on the ratio of the bigger pieces in the complex and the IHR product. So, I think in general, the ASP will come down as the IHR volume goes up, but there could be some offsets as well.

《國際衛生條例》和價格壓力。是的。所以，我認為《國際衛生條例》有了一個好的開始。我們的推出僅進行了大約四分之一。我想，你知道，隨著交易量的增加，麥可將會有一些看跌期權和選擇權，對嗎？所以，你知道，IHR 的數量可能會導致 ASP 普遍下降。但我們鼓勵平衡銷售意味著我們想要追求，你知道的，所有不同的疝氣，包括腹壁和複雜的腹壁，這是我們非常成功地開始的地方。所以，你知道，你知道，隨著我們的腹側和複雜用戶進入 IHR，IHR 將會增長，並且隨著新用戶產生興趣並希望開始使用 IHR，我們的腹側和複雜產品將會增長。因此，根據綜合體和 IHR 產品中較大部分的比例，ASP 可能會有一些波動。因此，我認為總的來說，隨著《國際衛生條例》數量的增加，平均售價將會下降，但也可能會有一些抵銷。

Got it. Thanks Tony. That's, helpful. And I guess, you know, you talked about the balance selling and you gave some colour around sales rep training and productivity. Do you, do you think you can elaborate a little more, you know, are you basically through a lot of the initial training that you had planned or is this going to be kind of a continuous process to improve our productivity, you know, over time?

知道了。謝謝托尼。那是，有幫助。我想，您知道，您談到了平衡銷售，並且對銷售代表培訓和生產力進行了一些闡述。您是否認為您可以詳細說明一下，您是否基本上完成了計劃中的大量初始培訓，或者這將是一個持續的過程，以提高我們的生產力，您知道，超過時間？

Yeah, I think our motto, Michael is perpetual training, right? This market is so dynamic and it's changing so rapidly that we have to continue to stay on top of the training So, we've, hired you know, a purpose-built training team that is going to focus on, you know, both the first training, second training, field training, you know, basically zoom update calls so essentially perpetual training. This is something that you know, we deeply believe in. It gives us a competitive advantage; we have a lot of innovation and clinical data to talk about. That's positive. So, you know, we, we are really going to up the, up the ante on our training going forward.

是的，我認為我們的座右銘，麥可是永恆的訓練，對嗎？這個市場如此充滿活力，變化如此之快，我們必須繼續保持培訓的領先地位，因此，我們聘請了一個專門建立的培訓團隊，該團隊將重點關注第一次訓練，第二次訓練，現場訓練，你知道，基本上是縮放更新調用，所以本質上是永久訓練。這是你知道的，我們深信不疑。它為我們帶來了競爭優勢；我們有很多創新和臨床數據可以討論。這是積極的。所以，你知道，我們真的會加大未來訓練的賭注。

Great. Thank you.

偉大的。謝謝。

Thanks, Mike.

謝謝，麥克。

Ladies and gentlemen, that concludes today's call. Thank you all for joining you. May now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝大家的加入。現在可以斷開連線。