Vivos Therapeutics Inc (VVOS) 2023 Q3 法說會逐字稿

Good day, everyone, and welcome to the Vivos Therapeutics' third-quarter 2023 earnings conference call. (Operator Instructions) This conference call is being recorded. And a replay of today's call will be available on the investor relation section of Vivo's website and will remain posted there for the next 30 days.

大家好，歡迎參加 Vivos Therapeutics 的 2023 年第三季財報電話會議。 （操作員說明）本次電話會議正在錄音。今天電話會議的重播將在 Vivo 網站的投資者關係部分提供，並將在未來 30 天內持續發布。

I will now hand over the call to Julie Gannon, Vivos' Investor Relation officer for introductions and reading of the safe harbor statement. Please go ahead.

我現在將把電話轉給 Vivos 投資者關係官 Julie Gannon，讓其介紹並宣讀安全港聲明。請繼續。

Thank you, operator. Hello, everyone, and welcome to our conference call. A copy of our earnings press release is available on the Investor Relations section of our website at www.vivos.com. With us on today's call are Kirk Huntsman, Vivos Chairman and Chief Executive Officer, and Brad Amman, Chief Financial Officer.

謝謝你，接線生。大家好，歡迎參加我們的電話會議。我們的收益新聞稿副本可在我們網站 www.vivos.com 的投資者關係部分取得。參加今天電話會議的有 Vivos 董事長兼執行長 Kirk Huntsman 和財務長 Brad Amman。

Today, we'll review the highlights and financial results for the third quarter of 2023, as well as more recent developments and Vivo's plans for the remainder of the year. Following these formal remarks, we will be happy to take questions. I would also like to remind everyone that today's call will contain certain forward-looking statements from our management made within the meaning of Section 27 A of the Securities Act of 1933 as amended and Section 21 E of the Securities and Exchange Act of 1934, as amended concerning future events.

今天，我們將回顧 2023 年第三季的亮點和財務業績，以及最新進展和 Vivo 在今年剩餘時間內的計劃。在這些正式發言之後，我們將很樂意回答問題。我還想提醒大家，今天的電話會議將包含我們管理層根據1933 年《證券法》修訂案第27 A 條和1934 年《證券交易法》第21 E 條的含義做出的某些前瞻性聲明，關於未來事件的修改。

Words such as aim, may, could, should, projects, expects, intends, plans, believes, anticipates, hopes, estimates, goal, and variations of such words and similar expressions are intended to identify forward-looking statements. These statements involve significant known and unknown risks and are based upon a number of assumptions and estimates, which are inherently subject to significant risks, uncertainties and contingencies, and many of which are beyond Vivos control.

諸如「目標」、「可能」、「能夠」、「應該」、「專案」、「期望」、「打算」、「計劃」、「相信」、「預期」、「希望」、「估計」、「目標」等詞語以及這些詞語的變體和類似表達方式旨在識別前瞻性陳述。這些陳述涉及重大的已知和未知風險，並基於許多假設和估計，這些假設和估計本質上受到重大風險、不確定性和意外事件的影響，其中許多風險、不確定性和意外事件超出了Vivos的控制範圍。

Actual results, including without limitation, the results of Vivos' growth strategies, operational plans, including sales, marketing, product acquisition and integration, research and development, regulatory initiatives, cost saving plans, and plans to generate revenue as well as future potential results of operations or operating metrics, such as potential for Vivos to achieve future positive cash flows and other matters to be addressed by Vivos management in this conference call may differ materially and adversely from those expressed or implied by such forward-looking statements.

實際結果，包括但不限於 Vivos 成長策略、營運計劃（包括銷售、行銷、產品收購和整合、研發、監管舉措、成本節約計劃、創收計劃以及未來潛在結果）的結果營運或營運指標，例如Vivos 實現未來正現金流的潛力以及Vivos 管理階層在本次電話會議中要解決的其他事項，可能與此類前瞻性聲明中明示或暗示的內容有重大且不利的差異。

Factors that could cause actual results to differ materially include, but are not limited to, the risk factors described in other disclosures contained in Vivos filings with the Securities and Exchange Commission, including the risk factors and other disclosures in our Form 10-K for the year ended December 31, 2022, and our other filings with the SEC including our 10-Q filed with the SEC today.

可能導致實際結果有重大差異的因素包括但不限於 Vivos 向美國證券交易委員會提交的文件中包含的其他揭露中所述的風險因素，包括我們的 10-K 表格中的風險因素和其他揭露截至2022 年12 月31 日的年度，以及我們向SEC 提交的其他文件，包括今天向SEC 提交的10-Q。

All of which are accessible on the Investor Relations section of the Vivos website as well as the SEC's website. Except to the extent required by law, Vivos assumes no obligation to update statements as circumstances change. Finally, please be aware that the US Food and Drug Administration have already given Vivos appliances, 510k clearance to treat mild to moderate OSA.

所有這些都可以在 Vivos 網站的投資者關係部分以及 SEC 網站上存取。除法律要求的範圍外，Vivos 不承擔因情況變化而更新聲明的義務。最後，請注意，美國食品藥物管理局已向 Vivos 設備授予 510k 許可，用於治療輕度至中度 OSA。

Any reference herein regarding Vivos' treatment or the Vivos' method should be viewed in that context. Treatment of patients with severe OSA is performed off-label at the sole clinical discretion of the treating doctor and are not part of the Vivos treatment protocol.

本文中有關 Vivos 治療或 Vivos 方法的任何引用均應在該上下文中查看。嚴重 OSA 患者的治療是由主治醫師自行臨床酌情進行的標籤外治療，且不屬於 Vivos 治療方案的一部分。

Now at this time, it is my pleasure to introduce Kirk Huntsman, Chairman and CEO of Vivos. Kirk, please go ahead.

此時此刻，我很高興向您介紹 Vivos 董事長兼執行長柯克‧亨茨曼 (Kirk Huntsman)。柯克，請繼續。

Thank you, Julie. I want to thank you all for joining us on today's conference call. In just a moment, I'll turn the call over to our Chief Financial Officer, Brad Amman, who will walk you through the highlights of our third quarter 2023 financial and operating results.

謝謝你，朱莉。我要感謝大家參加今天的電話會議。稍後，我將電話轉接給我們的財務長 Brad Amman，他將向您介紹我們 2023 年第三季財務和營運業績的亮點。

Once Brad has finished, I'll come back and speak with you about the highlights of what we accomplished at Vivos during the third quarter, and more recently after the quarter end. This includes some key strategic relationships that we formed with a number of new commercial partners, including our recently announced distribution agreement with Lincare, who is a recognized durable medical equipment company or DME. We are especially excited about this relationship because Lincare serves close to 2 million patients nationwide, many of whom are unsatisfied with using CPAP machines and are seeking alternative methods of treatment, something we can certainly oblige them with.

Brad 講完後，我將回來與您討論我們在第三季度以及最近季度末後在 Vivos 所取得的成就的亮點。這包括我們與許多新的商業合作夥伴建立的一些關鍵策略關係，包括我們最近宣布的與 Lincare 的分銷協議，Lincare 是公認的耐用醫療設備公司或 DME。我們對這種關係感到特別興奮，因為 Lincare 為全國近 200 萬名患者提供服務，其中許多人對使用 CPAP 機器不滿意，正在尋求替代療法，我們當然可以滿足他們的要求。

In addition to Lincare, I'll also talk a bit about some other agreements we've signed with partners such as with Ormco, a division of publicly traded Envista Holdings Corporation. On Demand Orthodontist, which represents an exciting new service we can now offer our Vivos providers and known in the Middle East region who has developed and maintains a number of strategic relationships and accounts for diagnostic testing with sleep physicians, sleep centers, hospitals, and other healthcare providers across the MENA region. Together, these relationships have expanded our product line and distribution channels and created new revenue opportunities for our company. We believe these new strategic relationships will generate a substantial number of patient referrals for our existing and extensive network of Vivos trained dentists, which should bring significant new growth and revenue opportunities to Vivos. We also believe these initiatives will help to augment and accelerate our VIP enrollment efforts.

除了 Lincare 之外，我還將談談我們與合作夥伴簽署的其他一些協議，例如與上市公司 Envista Holdings Corporation 的子公司 Ormco 簽署的協議。按需正畸醫生，這是我們現在可以為Vivos 提供者提供的一項令人興奮的新服務，該服務在中東地區享有盛譽，他們與睡眠醫生、睡眠中心、醫院和其他機構建立並維護了許多策略關係和診斷測試帳戶。整個中東和北非地區的醫療保健提供者。這些關係共同擴展了我們的產品線和分銷管道，並為我們公司創造了新的收入機會。我們相信，這些新的策略關係將為我們現有的廣泛 Vivos 培訓牙醫網絡帶來大量患者轉診，這將為 Vivos 帶來重大的新增長和收入機會。我們也相信這些措施將有助於加強和加速我們的 VIP 招生工作。

Along with these positive developments, I'll talk about some of our progress in reducing staff and trimming cost, where we achieved a 32% year-over-year reduction in operating expenses. Unfortunately, those cost cutting measures came with some near-term trade-offs, as top line revenue declined on both a quarter-over-quarter and year-over-year basis. We worked hard throughout this process to avoid staffing and other reductions that would impact revenue. But we now believe the new Vivos Integrated it -- we now believe new Vivos Integrated Providers or VIP enrollments and appliance sales have been negatively impacted because of those measures. Fortunately, since the quarter closed, we have seen strong positive trends in appliance sales as other revenue growth measures have kicked in.

除了這些積極的進展之外，我還將談談我們在減少員工和削減成本方面取得的一些進展，我們的營運費用比去年同期減少了 32%。不幸的是，這些成本削減措施帶來了一些短期的權衡，因為營收季比和年比均有所下降。我們在整個過程中努力工作，以避免人員配置和其他可能影響收入的裁員。但我們現在相信新的 Vivos Integrated it——我們現在相信新的 Vivos Integrated 提供者或 VIP 註冊和設備銷售已因這些措施而受到負面影響。幸運的是，自本季結束以來，隨著其他收入成長措施的啟動，我們看到家電銷售出現強勁的正面趨勢。

So the key takeaway here is that we believe our responsible cost cutting measures over the past year helps set a financial foundation that will support our revenue growth initiatives as we seek to improve our operating results going forward. I also want to highlight the steps we've been taking to improve our liquidity, as well as our capital structure. This includes the recent closing of a $4 million private placement, our reverse stock split, and the actions we've taken throughout the past year to increase operational efficiencies, reduce expenses, and position Vivos to capitalize on the growth opportunities available to us. With all the growth -- with all the progress that we've made and what we expect to accomplish as we move forward, we continue to plan for becoming cash flow positive from operations by the end of 2024.

因此，這裡的關鍵要點是，我們相信過去一年中我們負責任的成本削減措施有助於奠定財務基礎，在我們尋求改善未來的經營業績時，該基礎將支持我們的收入成長計劃。我還想強調我們為改善流動性以及資本結構所採取的措施。這包括最近完成的 400 萬美元私募、我們的反向股票分割，以及我們在過去一年中為提高營運效率、減少開支以及讓 Vivos 充分利用我們現有的成長機會而採取的行動。隨著所有的成長——我們已經取得的所有進展以及我們在前進過程中期望實現的目標，我們繼續計劃在 2024 年底之前實現營運現金流為正。

After talking a bit more about our plans for the rest of this year and what we are planning for 2024, we will be happy to take your questions. Now let me turn it over to Brad for a review of our financials. Brad, please go ahead.

在詳細討論了我們今年剩餘時間的計劃以及 2024 年的計劃後，我們將很樂意回答您的問題。現在讓我把它交給布拉德來審查我們的財務狀況。布拉德，請繼續。

Thank you, Kirk, and good afternoon, everyone. Today I'll review the highlights of our financial results for the third quarter and the first nine months of 2023. For further information on our results for the three- and nine-month periods ended September 30, 2023. I'll refer you to our earnings release, which was distributed earlier today and our quarterly report on Form 10-Q, which is available on the SEC filings portion of the Investor Relations section of the Vivos website at vivos.com/investor-relations.

謝謝柯克，大家下午好。今天，我將回顧我們 2023 年第三季和前九個月的財務業績要點。有關我們截至 2023 年 9 月 30 日的三個月和九個月期間業績的更多資訊。請參閱今天早些時候時候發布的收益報告以及10-Q 表格季度報告（可在Vivos 網站vivos.com/investor-relations 投資者關係部分的SEC 備案部分取得）。

Today, we reported third quarter 2023 total revenue of $3.3 million compared to $4.2 million for the third quarter of 2022. The quarter-over-quarter decrease was due to lower revenue generated quarter over quarter from appliance sales, revenue from VIP enrollments, as well as the impact from staffing and cost reductions. This was partially offset by increased sleep testing services and myofunctional therapy revenue.

今天，我們報告 2023 年第三季的總收入為 330 萬美元，而 2022 年第三季的總收入為 420 萬美元。環比下降的原因是設備銷售、VIP 註冊收入環比下降，以及人員配置和成本削減的影響。這被睡眠測試服務和肌肉功能治療收入的增加部分抵消。

During the third quarter of 2023, we enrolled 29 VIPs and recognized VIP revenue of approximately $1 million compared to 56 VIPs for a total of $1.6 million in revenue during the same period last year. Revenue growth was impacted by new entry levels into our VIP program, ranging from $2,500 to $50,000 and adding an $8,000 pediatric program, which was received positively by our providers. Average enrollments during the period increased from approximately 28,000 during the three months ended September 30, 2022, to 34,000 during the three months ended September 30, 2023. And VIP enrollment right to buy revenue was recognized over a longer period of time, 23 months in 2023 versus 18 months in 2022. We sold 1,809 oral appliance arches during the third quarter of 2023 for a total of approximately $1.5 million compared to 3,057 during the third quarter of 2022 for $2 million.

2023 年第三季度，我們註冊了 29 名 VIP，確認 VIP 收入約為 100 萬美元，而去年同期有 56 名 VIP，確認的總收入為 160 萬美元。收入成長受到 VIP 計劃新入門級別的影響，從 2,500 美元到 50,000 美元不等，並增加了 8,000 美元的兒科計劃，該計劃受到了我們的提供者的積極評價。期內平均註冊人數從截至2022 年9 月30 日止三個月的約28,000 人增加至截至2023 年9 月30 日止三個月的34,000 人。 VIP 註冊購買收入的權利在較長一段時間內（即2023 年 23 個月） 獲得確認。2023 年與2022 年18 個月相比。我們在2023 年第三季度售出了1,809 個口腔矯正器拱門，總價值約為150 萬美元，而2022 年第三季我們售出了3,057 個口腔矯正器拱門，總價值為200 萬美元。

During both the third quarters of 2023 and 2022, we recognized approximately $200,000 in Billing Intelligence Service revenue compared to $300,000 during the same period in 2022. Myofunctional therapy services remained flat period-over-period at $200,000. Lastly, during our third quarter of 2023, we recognized $300,000 in revenue from our ring lease program compared to $100,000 in our comparable 2022 period.

在 2023 年和 2022 年第三季度，我們確認計費智能服務收入約為 200,000 美元，而 2022 年同期為 300,000 美元。肌功能治療服務同比持平，為 200,000 美元。最後，在 2023 年第三季度，我們從環租賃計畫中確認了 30 萬美元的收入，而 2022 年同期為 10 萬美元。

For the nine months ended September 30, 2023, revenue was $10.6 million compared to $12.1 million for the nine months ended last year. The decrease was attributable to the same factors I mentioned earlier. During the first nine months of 2023, we enrolled 110 VIPs for revenue of $3.2 million compared to 146 VIPs and revenue of $3.6 million for the same period in 2022.

截至 2023 年 9 月 30 日的 9 個月，收入為 1,060 萬美元，而去年截至 9 個月的收入為 1,210 萬美元。下降的原因與我之前提到的相同。 2023 年前 9 個月，我們註冊了 110 名 VIP，收入為 320 萬美元，而 2022 年同期註冊了 146 名 VIP，收入為 360 萬美元。

During the nine months ended September 30, 2023, we sold 6,261 oral appliance arches for a revenue of $4.6 million compared to 9,343 oral appliance arches for revenue of approximately $5.8 million. We attribute the decrease in product sales in part due to a negative CBS news report that came out in March of 2023 regarding an unrelated oral device called the AGGA that was not cleared for use by the FDA and was being used off-label. Although Vivos CARE devices are cleared by the FDA, based on our continuing discussions with our dentist customers, we believe that some practitioners paused purchases until they learn more about the issue.

截至 2023 年 9 月 30 日的九個月內，我們售出了 6,261 個口腔矯正器拱門，收入為 460 萬美元，而銷售了 9,343 個口腔矯正器拱門，收入約為 580 萬美元。我們將產品銷售下降的部分原因歸因於2023 年3 月哥倫比亞廣播公司(CBS) 發布的關於一種名為AGGA 的不相關口腔裝置的負面新聞報道，該裝置未經FDA 批准使用，並且正在標籤外使用。儘管 Vivos CARE 設備已獲得 FDA 批准，但根據我們與牙醫客戶的持續討論，我們認為一些從業者暫停了購買，直到他們了解更多有關該問題的資訊。

Additionally, for the nine months ended September 30, 2023, and 2022, we recognized approximately $700,000 in myofunctional therapy revenue. For the nine months ended September 30, 2023, we had $600,000 in Billing Intelligence Service revenue compared to $900,000 in the prior year period. Lastly, for the nine months ended September 30 of this year, we recognized approximately $900,000 in sleep testing services compared to $300,000 for the nine months ended last year and $100,000 in-center product revenue compared to $500,000 for the nine months ended last year.

此外，在截至 2023 年 9 月 30 日和 2022 年的九個月中，我們確認了約 70 萬美元的肌肉功能治療收入。截至 2023 年 9 月 30 日的九個月，我們的計費智慧服務收入為 60 萬美元，而去年同期為 90 萬美元。最後，截至今年9 月30 日的9 個月，我們確認睡眠測試服務收入約為90 萬美元，而去年截至9 個月的收入為30 萬美元，中心產品收入為10 萬美元，而去年截至9 個月的收入為500,000 美元。

Gross profit was $1.9 million for the third quarter of 2023 compared to gross profit of $2.5 million for the comparable period in 2022. Gross margin was 57% for the third quarter of 2023 compared to 59% during the prior year period.

2023 年第三季的毛利為 190 萬美元，而 2022 年同期毛利為 250 萬美元。2023 年第三季的毛利率為 57%，而去年同期為 59%。

Gross profit for the nine months ended September 30, 2023, was $6.3 million compared to $7.6 million for the nine months ended last year. Gross margin for the nine months ended September 30, 2023, was 60% compared to 63% for the same period last year due to lower revenue. Sales and marketing expenses were lower quarter over quarter and year-over-year expenses were $600,000 for the third quarter of 2023 compared to $1.1 million for the third quarter of 2022.

截至2023年9月30日的九個月的毛利為630萬美元，而去年截至9個月的毛利為760萬美元。由於收入下降，截至 2023 年 9 月 30 日止九個月的毛利率為 60%，而去年同期為 63%。 2023 年第三季銷售和行銷費用較上季下降，年比費用為 60 萬美元，而 2022 年第三季為 110 萬美元。

For the nine months ended September 30, 2023, sales and marketing expense was $1.9 million compared to $4 million for the nine months ended last year. Lower spend reflects website development for both vivos.com and thevivosinstitute.com that occurred in 2022. And lower sales commissions and sales-related expenses in 2023, commensurate with lower VIP enrollments.

截至 2023 年 9 月 30 日的 9 個月，銷售和行銷費用為 190 萬美元，而去年截至 9 個月的銷售和行銷費用為 400 萬美元。支出減少反映了 2022 年發生的 vivos.com 和 thevivosinstitute.com 網站開發工作。2023 年銷售佣金和銷售相關費用減少，與 VIP 註冊人數減少相稱。

Very importantly, our G&A expenses decreased approximately $2 million or 31% to $4.6 million for the third quarter of 2023 compared to $6.6 million for the third quarter of last year. Year over year decrease reflects a substantial impact in our previously announced cost cutting efforts are making. We believe these important efforts will cause -- will continue to reduce our cash burn as we seek to ramp revenues and move toward cash flow-positive operations.

非常重要的是，2023 年第三季我們的一般管理費用減少了約 200 萬美元，即 31%，至 460 萬美元，而去年第三季為 660 萬美元。同比下降反映了我們先前宣布的成本削減努力所產生的重大影響。我們相信，這些重要的努力將繼續減少我們的現金消耗，因為我們尋求增加收入並轉向現金流量正營運。

For the nine months ended September 30, 2023, general and administrative expenses decreased $5.1 million or 23% to $17 million compared to $22.1 million for the nine months ended last year. The primary driver of this decrease was a change in personnel and related compensation of approximately $2.7 million. Total operating expenses for the third quarter of 2023 decreased by a significant amount, $2.5 million or 32% versus the third quarter of 2022, also reflecting versus cost cutting initiatives.

截至 2023 年 9 月 30 日的 9 個月，一般及管理費用減少 510 萬美元，即 23%，至 1,700 萬美元，而去年截至 9 個月的費用為 2,210 萬美元。造成這一下降的主要原因是人員變動和相關薪酬約 270 萬美元。 2023 年第三季的總營運費用較 2022 年第三季大幅下降 250 萬美元，即 32%，也反映了成本削減措施。

For the nine months ended September 30, 2023, operating expenses decreased by $7.3 million or 27% compared to the same period in 2022. Operating loss was approximately $3.5 million and $5.4 million for the three and nine months ended September 30, 2023, compared to $13 million and 19 million for the comparable periods last year. Year-over-year decrease in operating loss was primarily from lower G&A due to expense cuts and the other factors I just discussed.

截至2023年9月30日的九個月，營運費用較2022年同期減少730萬美元，即27%。截至2023年9月30日的三個月和九個月，營運虧損分別約為350萬美元和540萬美元。去年同期分別為 1,300 萬美元和 1,900 萬美元。營業虧損年減主要是因為費用削減和我剛才討論的其他因素導致一般管理費用下降。

Net loss was approximately $2.1 million for the third quarter of 2023, a significant year-over-year reduction of $3.3 million or 61% compared to $5.4 million for the third quarter of 2022. The reduction in net loss was primarily due to the due to the cost cutting initiatives I described earlier. Net loss for the nine months ended September 30 of 2023 was $9.3 million, a reduction of $8.4 million or 47% compared to $17.8 million for the same period in 2022.

2023 年第三季的淨虧損約為 210 萬美元，與 2022 年第三季的 540 萬美元相比，年比大幅減少 330 萬美元，即 61%。淨虧損減少主要是由於我之前描述的成本削減舉措。截至 2023 年 9 月 30 日的九個月淨虧損為 930 萬美元，與 2022 年同期的 1,780 萬美元相比減少了 840 萬美元，即 47%。

Turning to our statement of cash flows, cash burn from operations for the nine months ended September 30 of this year was $9.2 million, a decrease of approximately $7.4 million compared to $16.6 million during the comparable prior year period. This is further evidence of the positive impact of our expense reduction initiatives.

談到我們的現金流量表，今年截至 9 月 30 日的九個月的營運現金消耗為 920 萬美元，比去年同期的 1,660 萬美元減少了約 740 萬美元。這進一步證明了我們削減開支措施的正面影響。

For the nine months ended September 30, 2023, net cash used in investing activities consisted of capital expenditures for software of $700,000 related to the development of VIP, ordering software for internal use, which is expected to be placed in service in late 2023, as well as a purchase of patents and other intellectual property in February of this year. This similarly compares with cash used in investing activities of $700,000 in the comparable 2022 period arising from cash capital expenditures for the internally developed ordering software.

截至 2023 年 9 月 30 日的九個月，投資活動使用的淨現金包括與開發 VIP 相關的 700,000 美元軟體資本支出，訂購供內部使用的軟體，預計將於 2023 年底投入使用，如下：以及今年二月購買的專利和其他智慧財產權。相較之下，2022 年同期投資活動所用現金為 70 萬美元，這些現金來自內部開發的訂購軟體的現金資本支出。

As of September 30, 2023, we had $1 million in cash and cash equivalents compared to$ 3.5 million as of December 31 of 2022. As previously announced, following the end of the third quarter earlier this November, Vivos completed a private placement for net proceeds of approximately $3.5 million to augment its liquidity position and stockholders' equity. As Kirk mentioned earlier, our goal remains to become cash flow positive from operations by the end of 2024. With that, I'll turn the call back over to Kirk.

截至2023 年9 月30 日，我們擁有100 萬美元的現金和現金等價物，而截至2022 年12 月31 日，我們擁有350 萬美元。正如之前宣布的，在今年11 月初第三季結束後，Vivos完成了淨資產私募收益約 350 萬美元，用於增強其流動性狀況和股東權益。正如柯克之前提到的，我們的目標仍然是到 2024 年底實現營運現金流為正。這樣，我會將電話轉回給柯克。

Thank you, Brad. Let's jump right into it now and answer what are probably the most pressing questions on your mind regarding our company's performance in the third quarter year to date and our prospects for resuming real growth -- real revenue growth in 2024.

謝謝你，布拉德。現在讓我們直接進入正題，回答您可能最緊迫的問題，這些問題涉及我們公司今年第三季度的業績以及我們恢復實際增長（2024 年實際收入增長）的前景。

First, why did top-line revenue decline when the expectation was that Lincare, and other revenue initiatives were supposed to begin to impact revenue starting in Q3? Well, I would point to four primary factors here.

首先，當人們預期 Lincare 和其他收入計劃應該從第三季開始影響收入時，為什麼營收卻下降了？好吧，我想在這裡指出四個主要因素。

First, a reduction in staffing and support personnel. Second, a reduction in marketing expenditures. Third, lingering effects of the AGGA news reports and related government investigations Brad mentioned earlier. And fourth, the unavoidable delay in the Lincare project getting off the ground after a successful pilot.

首先，減少人員配置和支援人員。其次，減少行銷支出。第三，布拉德之前提到的 AGGA 新聞報告和相關政府調查的揮之不去的影響。第四，Lincare 計畫在試點成功後啟動不可避免地出現延誤。

Let me discuss each of these. Throughout 2023, we have executed on broad cost cutting measures that have included reductions in certain support personnel, which were very influential in assisting VIP dentists to get cases booked and processed as Vivos case starts. We were keenly aware that curtailing those support functions would tend to decrease case starts and appliance sales, which is exactly what we have experienced. Fortunately, our new product lines have begun to kick in.

讓我逐一討論一下。 2023 年全年，我們執行了廣泛的成本削減措施，其中包括減少某些支援人員，這對於協助 VIP 牙醫在 Vivos 病例開始時預訂和處理病例非常有影響力。我們敏銳地意識到，削減這些支援功能往往會減少案件啟動和設備銷售，而這正是我們所經歷的。幸運的是，我們的新產品線已經開始發揮作用。

And here in the fourth quarter, we are seeing appliance sales and myofunctional therapy starts rebounding. As our cash resources declined, we were constrained to cut back on certain marketing expenditures as well. However, we did refocus and redirect our limited marketing spend to only those areas with the potential for the highest near-term returns.

在第四季度，我們看到電器銷售和肌肉功能治療開始反彈。隨著我們的現金資源減少，我們也被迫削減某些行銷支出。然而，我們確實重新調整了重點，並將有限的行銷支出重新定向到那些有可能獲得最高短期回報的領域。

Next, as previously mentioned by Brad, the impact of that negative publicity and news reports regarding the AGGA device went deeper and lasted longer than we expected. You may recall that in March of this year, a CBS news report broke about a non-FDA cleared oral appliance called the AGGA, that made unsubstantiated claims regarding its ability to treat obstructive sleep apnea. Government regulators and others set up consumer complaint hotlines and moved aggressively to investigate and curtail any further damage or potential harm to the general public.

接下來，正如 Brad 之前提到的，有關 AGGA 設備的負面宣傳和新聞報導的影響比我們預期的更深、持續時間更長。您可能還記得，今年3 月，哥倫比亞廣播公司(CBS) 的一篇新聞報道爆料了一種未經FDA 批准的名為AGGA 的口腔矯正器，該矯正器對其治療阻塞性睡眠呼吸中止症的能力提出了未經證實的說法。政府監管機構和其他機構設立了消費者投訴熱線，並積極調查並減少對公眾的任何進一步損害或潛在傷害。

Now despite the AGGA being a materially different device with virtually no research to back it up and no required regulatory FDA clearances, the mere suggestion that an oral appliance for treating sleep apnea potentially cause patient harm, truly impacted our sales and enrollment efforts. We took many steps to ensure that our Vivos VIP doctors clearly understood the differences between that device and our Vivos CARE devices. But the entire episode caused many of them to pause their Vivos production until further clarity and certainty could be provided.

現在，儘管AGGA 是一種完全不同的設備，幾乎沒有研究支持它，也不需要FDA 的監管許可，但僅僅暗示用於治療睡眠呼吸中止症的口腔矯正器可能會對患者造成傷害，就真正影響了我們的銷售和註冊工作。我們採取了許多措施來確保我們的 Vivos VIP 醫生清楚地了解該設備與我們的 Vivos CARE 設備之間的差異。但整個事件導致他們中的許多人暫停了 Vivos 的生產，直到提供進一步的清晰度和確定性。

Finally, the previously announced Lincare project was temporarily delayed due to some software configuration and development delays by a third party charged with facilitating merchant banking and payment arrangements to Lincare. I am pleased to report that the situation there has now been resolved and the planned expansion into additional markets has resumed in earnest. Obviously, the aforementioned delay also impacted our forecasted top line revenue for Q3.

最後，由於負責為 Lincare 提供商業銀行服務和支付安排的第三方的一些軟體配置和開發延遲，先前宣布的 Lincare 專案暫時推遲。我很高興地報告，那裡的情況現已解決，並且已認真恢復向其他市場的擴張計劃。顯然，上述延遲也影響了我們對第三季營收的預測。

Now that that delay is behind us, we do expect to see the Lincare project contributing positively to Q4 and into 2024. So the takeaway here is that Vivos is operating leaner than ever before, and the revenue headwinds previously discussed appear to be behind us. New product lines are showing great promise and good growth. And the new initiatives such as our Boost and Kickoff programs are being well received.

既然這種延遲已經過去，我們確實希望看到Lincare 項目對第四季度和2024 年做出積極貢獻。因此，這裡的結論是，Vivos 的運營比以往任何時候都更加精簡，之前討論的收入逆風似乎已經成為過去。新產品線顯示出巨大的前景和良好的成長。我們的 Boost 和 Kickoff 計劃等新舉措受到了好評。

Now let me touch on those two programs for just a moment. During the latter part of the third quarter and into the current quarter, we began to offer what we call Boost and Kickoff programs to current and new Vivos providers. The Boost program requires existing VIP providers to prepay a minimum of $10,000 in appliances in order to have our corporate personnel come to their offices to help set up systems, train staff, and closed cases. Approximately 40 boost programs have been sold to date, with most of them to be delivered in 2024. The kickoff program is basically the same except that it is included in the enrollment fees for new doctors.

現在讓我簡單談談這兩個程序。在第三季後半段和本季度，我們開始向現有和新的 Vivos 供應商提供所謂的 Boost 和 Kickoff 計畫。 Boost 計劃要求現有 VIP 提供者預付至少 10,000 美元的設備費用，以便我們的公司人員來到他們的辦公室幫助設置係統、培訓員工和結案。迄今為止，已售出約 40 個增強計劃，其中大部分將於 2024 年交付。啟動計劃基本上相同，僅包含在新醫生的註冊費中。

These programs have now been delivered and executed in just a handful of offices, generating close to $400,000 in new case starts and a ton of positive momentum and provider enthusiasm. After successful events in their individual offices, a number of doctors have renewed and repurchased additional Boost events. We believe this highly successful new program will continue to drive new case starts and rekindle provider enthusiasm in Q4 and throughout 2024.

這些項目現已在少數幾個辦事處交付和執行，在新案例啟動中產生了近 40 萬美元的收入，並帶來了大量的積極動力和提供者的熱情。在各自辦公室舉辦的活動取得成功後，許多醫生續訂並重新購買了額外的 Boost 活動。我們相信，這項非常成功的新計畫將在第四季和整個 2024 年繼續推動新案例啟動並重新點燃提供者的熱情。

Second, why should investors now believe that the growth strategy will finally be realized going forward and then it will actually result in the company getting to cash flow positive. To answer that question, I believe -- the answer to that question I believe is that we are pivoting away from a revenue model that is oriented towards new VIP growth with a dependency on dentists who must generate their own case starts, and towards a model that is driven by recruiting new patient sources such as DME companies, medical doctors, non-Vivos dentists, et cetera. And generating new case starts in existing VIP offices, as with our Boost and kick off programs.

其次，為什麼投資者現在應該相信成長策略最終會實現，然後實際上會導致公司實現正現金流。為了回答這個問題，我相信 - 我相信這個問題的答案是，我們正在從一種以新 VIP 增長為導向、依賴於必須自己生成病例的牙醫的收入模式轉向一種模式這是通過招募新的患者來源（例如DME 公司、醫生、非Vivos 牙醫等）來推動的。並在現有的 VIP 辦公室中啟動新的案例，就像我們的 Boost 和啟動計劃一樣。

Our new product line, which we acquired earlier this year, is already showing promise of higher growth ahead. The agreement with Lincare is already feeding new patients into VIP offices. We expect more such DME distribution agreements will follow throughout 2024 after the Lincare exclusivity period expires in April.

我們今年稍早收購的新產品線已經顯示出未來更高成長的前景。與 Lincare 達成的協議已將新患者送入 VIP 辦公室。我們預計，在 Lincare 獨家經營期於 4 月到期後，2024 年將會有更多此類 DME 分銷協議。

We have also proven our ability to generate medical referrals into Vivos provider practices and are currently expanding and intensifying those efforts. In November of 2023, we amended our agreement with Lincare, which gives Lincare a six-month exclusivity period to distribute certain designated devices of ours. The agreement follows the successful conclusion of a distribution pilot with Lincare. And we believe there are additional DME opportunities that are aligned with these initiatives, and we are actively engaged in exploring such opportunities.

我們也證明了我們有能力將醫療轉介引入 Vivos 提供者實踐，目前正在擴大和加強這些努力。 2023 年 11 月，我們修改了與 Lincare 的協議，給予 Lincare 六個月的獨家經營權來分銷我們的某些指定設備。該協議是在與 Lincare 成功完成分銷試點之後達成的。我們相信還有與這些舉措一致的其他 DME 機會，並且我們正在積極探索這些機會。

In addition to Lincare, in October of 2023, we announced two key strategic agreements with Ormco, a division of publicly traded Envista Holdings Corporation and On Demand Orthodontists or ODO. Offering our national network of providers access to Spark Clear Aligners. The agreements will expand our current product line and are expected to create near term additional revenue opportunities that should begin to contribute here, in the fourth quarter.

除了 Lincare 之外，我們還在 2023 年 10 月宣布了與 Ormco（上市公司 Envista Holdings Corporation 的子公司）和 On Demand Orthodontists 或 ODO 達成的兩項重要策略協議。為我們的全國供應商網路提供 Spark Clear Aligners 的存取權限。這些協議將擴大我們目前的產品線，並預計將創造近期額外的收入機會，這些機會應在第四季度開始貢獻。

Also in October, we announced that we had entered into an exclusive distribution agreement with NOUM DMCC, a Dubai based company focused on diagnostic testing and treatment product distribution for healthcare providers and hospital networks treating obstructive sleep apnea patients throughout the Middle East-North Africa or MENA region. Subject to regulatory approvals, Vivos could begin to see revenue from this collaboration in 2024.

同樣在10 月，我們宣布與NOUM DMCC 簽訂了獨家經銷協議，NOUM DMCC 是一家總部位於杜拜的公司，專注於為整個中東和北非地區或治療阻塞性睡眠呼吸中止症患者的醫療保健提供者和醫院網絡分銷診斷測試和治療產品。中東和北非地區。待監管部門批准後，Vivos 可能會在 2024 年開始從此次合作中獲得收入。

In addition, we are currently in negotiations for similar distribution agreements in other important international markets. If and as such, negotiations come to fruition, we will be sure to announce them.

此外，我們目前正在其他重要國際市場就類似的分銷協議進行談判。如果談判有成果，我們一定會宣布。

On the clinical and regulatory front. In October, we announced that our flagship daytime-nighttime appliance or DNA, will be tested in a clinical trial at Stanford medicine. The protocol has been finalized and participant enrollment will begin in early 2024. Study participants with moderate to severe OSA will be randomly assigned to either treatment with Vivos' DNA appliance or CPAP, the current industry standard for OSA treatments. Sleep studies will be performed prior to and following a course of treatment using in-lab polysomnography or PSG to assess changes in the patients' apnea-hypopnea index or AHI.

在臨床和監管方面。 10 月，我們宣布我們的旗艦日間夜間設備或 DNA 將在史丹佛大學醫學院進行臨床試驗。該方案已最終確定，參與者招募將於 2024 年初開始。患有中度至重度 OSA 的研究參與者將被隨機分配接受 Vivos 的 DNA 裝置或 CPAP 治療（目前 OSA 治療的行業標準）。將在治療前和治療後使用實驗室多導睡眠圖或 PSG 進行睡眠研究，以評估患者呼吸中止低通氣指數或 AHI 的變化。

In addition, we continue to actively pursue new regulatory approvals for additional indications of use by the FDA for Vivos oral appliances. We hope to be able to announce some important regulatory developments in the near future. Although no assurances can be given that any such approvals will be granted by the FDA, nor can we predict the timing of such grants should they occur.

此外，我們繼續積極尋求 FDA 對 Vivos 口腔矯正器的其他使用適應症的新監管批准。我們希望能夠在不久的將來宣布一些重要的監管進展。儘管不能保證 FDA 會授予任何此類批准，但我們也無法預測此類授予的時間。

Finally, a word about our capital needs going forward. Our current forecast suggests that we should be able to turn cash flow positive in 2024. With the recent infusion of $4 million, we took a significant step towards that goal. However, we expect to need an additional round of capital in a similar amount to achieve that goal. We are currently working with a number of interested parties to ensure that the capital we need will be there when we need it.

最後，談談我們未來的資本需求。我們目前的預測表明，我們應該能夠在 2024 年實現正現金流。隨著最近注入 400 萬美元，我們朝著這一目標邁出了重要一步。然而，我們預計需要一輪類似金額的額外資金才能實現這一目標。我們目前正在與許多有興趣的各方合作，以確保我們需要的資金能夠在我們需要的時候提供。

That concludes our prepared remarks. Now we will be happy to take questions. Operator?

我們準備好的演講到此結束。現在我們很樂意回答問題。操作員？

(Operator Instructions) Lucas Ward, Ascendiant Capital Markets.

（操作員指令）Lucas Ward，Ascendiant Capital Markets。

Hi, guys. Thanks for the overview. My first question is on G&A expenses. Those have really been coming down pretty dramatically over the last six quarters, really. I was wondering what your expectations are for G&A run rate in Q4 and into next year?

嗨，大家好。感謝您的概述。我的第一個問題是關於一般行政費用。在過去的六個季度裡，這些數字確實大幅下降了。我想知道您對第四季和明年的一般行政費用運行率有何期望？

Brad, you want to take that.

布拉德，你想接受這個。

Yeah, you bet. As I said earlier, we cut around $2.7 million of personnel-related costs. We've also cut a number of nonessential vendors and consultants professional fees have come down substantially. We expect that fourth quarter G&A expenses will be very similar to what we experienced in the third quarter.

是的，你打賭。正如我之前所說，我們削減了約 270 萬美元的人員​​相關成本。我們也削減了一些非必要的供應商和顧問的專業費用。我們預計第四季的一般管理費用將與第三季的經驗非常相似。

I would add to that. That it's important to note that we are constantly evaluating and reevaluating our G&A expenditures relative to our revenue. And so we may be making as circumstances dictate additional changes either up or down, depending on how our revenue begins to develop, whether it recovers or whether it continues to go flat for a little bit here. But we fully expect that we will continue to rightsized our G&A according to our revenue streams. And I think we've now, as Brad indicated, I think we've now got that just about right, but we're always looking at it and always reevaluating.

我想補充一點。值得注意的是，我們不斷評估和重新評估相對於收入的一般管理支出。因此，我們可能會根據情況進行額外的調整，無論是向上還是向下，這取決於我們的收入如何開始發展，是否恢復或是否繼續保持穩定。但我們完全期望我們將繼續根據我們的收入來源調整我們的一般管理費用。我認為我們現在，正如布拉德所指出的，我認為我們現在已經做到了這一點，但我們一直在關注它並總是重新評估。

Okay, great. Just a follow-up question on the revenue front. In terms of the overall market opportunity, you mentioned, I think last quarter that if you could convert just 1% of the so-called failed CPAP revenues from the DMEs for instance, that might be enough to get you to breakeven. So clearly, there's a very large sort of penetration opportunity there. I'm wondering like what would be the catalysts -- catalyst or catalysts to really convert those sales into the Vivos?

好的，太好了。只是關於收入方面的後續問題。就整體市場機會而言，您提到，我認為上個季度，如果您可以將 DME 所謂失敗的 CPAP 收入的 1% 轉化為美元，這可能足以讓您實現收支平衡。很明顯，那裡存在著很大的滲透機會。我想知道什麼是催化劑——真正將這些銷量轉化為 Vivo 的催化劑？

Good questions. So the first step in that process is for the DME companies or the other referral sources depending on wherever they are, right. The other places where these patients are known. To identify who might be a candidate. So to identify and enter into a dialogue with a CPAP failed patient.

好問題。因此，該過程的第一步是針對 DME 公司或其他推薦來源，這取決於他們在哪裡，對吧。已知這些患者的其他地方。確定誰可能是候選人。因此，要識別 CPAP 失敗的患者並與其進行對話。

Now most of the DME companies monitor their CPAP patients remotely. So they have a good sense of who's using their CPAP and who isn't. And so the first outreach effort, whether -- regardless of the of the source, the first outreach effort is an engagement with the patient to understand what happened there, why aren't they using their CPAP, and would they be interested in an alternative therapy. Most of the time they're getting some really good flow through at that level, and that's all handled by the DME company.

現在，大多數 DME 公司都遠端監控他們的 CPAP 患者。因此，他們很清楚誰在使用 CPAP，誰沒有。因此，第一個外展工作，無論來源如何，第一個外展工作是與患者接觸，了解那裡發生了什麼，為什麼不使用 CPAP，以及他們是否對替代方案感興趣治療。大多數時候，他們在該級別上獲得了一些非常好的流程，而這一切都由 DME 公司處理。

So Lincare handles that part of it. They then hand that over to our Treatment Navigator. Those patients that indicate an interest, to hand them over to a Vivos Treatment Navigator who takes that patient, provides further of education about oral appliance therapy and attempts to get that patient to set an appointment up.

所以 Lincare 處理這部分。然後他們將其交給我們的治療導航器。那些表示有興趣的患者將其交給 Vivos 治療導航員，該導航員會接待該患者，提供有關口腔矯正器治療的進一步教育，並嘗試讓該患者安排預約。

So the process is fairly straightforward. The numbers of patients that sort of fit that criteria set are vast. I mean, we're talking about in a millions of patients here. And so it just is a matter of time. (multiple speakers)

所以這個過程相當簡單。符合該標準的患者數量龐大。我的意思是，我們在這裡談論的是數百萬患者。所以這只是時間問題。 （多個發言者）

It's a matter of time. And I think one of the things that are -- let me just finish one other thought. And that is, that what we've demonstrated with our Boost program. When we go into a dental office, we ask the dentist and his team to set up a full schedule of patients. So between 7 -- say, 7 to 10 patients each day for two days. They go into do a Boost program and they've got probably between 10 and 20 at-bats with patients.

這是時間問題。我認為其中一件事是——讓我完成另一個想法。這就是我們透過 Boost 計劃所展示的內容。當我們走進牙醫診所時，我們會要求牙醫和他的團隊制定完整的患者時間表。因此，兩天內每天有 7 名患者（比如說 7 到 10 名患者）。他們開展了一項 Boost 計劃，並與患者進行了大約 10 到 20 次擊球。

And our results are just outstanding. I mean, I think we had one that was 19 for 20 converted into treatment and other one was 11 for 11 and 10 for 10 and 6 of 9. I mean we keep going down here. We're getting conversion rates very, very high in the offices when we're sending our professional teams in there to show these doctors how to do it.

我們的成績非常優秀。我的意思是，我認為我們有一個將 20 中的 19 轉換為治療，另一個是 11 中的 11 和 10 中的 10 以及 9 中的 6。我的意思是我們繼續下去。當我們派專業團隊去那裡向醫生展示如何做到這一點時，我們在辦公室的轉換率非常非常高。

So if the butts are in the chair and the patients are there, we've demonstrated the ability to close. And we just have to get more doctors with the competence level and the staff members to be able to close those things. And that's what we're working on now.

因此，如果屁股在椅子上並且病人在那裡，我們就證明了關閉的能力。我們只需要找到更多具有能力水平的醫生和工作人員就能夠完成這些事情。這就是我們現在正在努力的事情。

Okay, great, Kirk. If I could, with just one more question. You had this uptick in the ring lease revenues, up 300% versus last year. To what extent is that an indicator of future sales in other areas, given that that's sort of a testing program.

好吧，太好了，柯克。如果可以的話，我還有一個問題。環租賃收入增加，比去年增長了 300%。鑑於這是一個測試計劃，這在多大程度上是其他領域未來銷售的指標。

We always think of the sleep testing kind of being the front end of the process and the more tests that a provider completes with their patients, theoretically, the more case starts as a result of that. A lot of our providers are testing a lot of their patients. We're just working on mechanisms and ways to increase that conversion from the test to a case start.

我們始終認為睡眠測試是過程的前端，提供者與患者完成的測試越多，理論上，因此開始的病例就越多。我們的許多提供者正在對他們的許多患者進行測試。我們正在研究增加從測試到案例啟動的轉換的機制和方法。

Yeah, so let me add onto that a little bit. I think as Brad just mentioned, the sleep testing program using the sleep image rings that we refer to as VivoScore rings. That's the tip of the spear. It's the first opportunity that a patient has to really begin to understand that they have sleep apnea. And so it's really the entry point.

是的，所以讓我補充一點。我認為正如 Brad 剛才提到的，使用睡眠圖像環的睡眠測試程序，我們稱之為 VivoScore 環。那是矛的尖端。這是患者第一次真正開始了解自己患有睡眠呼吸中止症。所以這確實是切入點。

Now we do about 75,000 tests a year throughout our network. And most of those patients, about half of those patients test positive. So there's a large number of patients that are testing positive, but these patients are not being closed by the dental offices. Their cases are not being properly explained, and they're not getting the closure on those cases.

現在，我們每年在整個網路中進行約 75,000 次測試。大多數患者，大約一半的患者檢測結果呈陽性。因此，有大量患者的檢測結果呈陽性，但牙科診所並沒有關閉這些患者。他們的案件沒有得到適當的解釋，他們的案件也沒有結案。

So we send our corporate teams out there to again, show these people step-by-step how to close the cases. And we're closing like 90% of these people, then the dental team start to get it; they start to understand. And we may have trained them 10 times, but when they see it happening in their own offices, what we found so far and it's our data set is fairly limited here. But what we see so far is that once we show them the way in their offices, they then are able to pick up and continue that high level of closing.

因此，我們再次派遣我們的公司團隊前往那裡，逐步向這些人展示如何結案。我們關閉了大約 90% 的人，然後牙科團隊開始了解；他們開始明白了。我們可能已經對他們進行了 10 次培訓，但是當他們在自己的辦公室看到這種情況發生時，我們到目前為止發現的情況以及我們的數據集在這裡相當有限。但到目前為止我們看到的是，一旦我們在他們的辦公室為他們指明了方向，他們就能夠恢復並繼續高水準的成交。

And that's really something that we've taken great hard in because it's a sea change type event for us to see 10 out of 11 patients being closed. If we had had that all along in these dental offices, I mean, we would be having a totally different type of conversation here. But now that we figured out a little bit of how to generate that kind of confidence and competency in the offices, we think that that portends very good things to come.

這確實是我們非常努力的事情，因為這是一個巨大的變化，我們看到 11 名患者中有 10 名被關閉。我的意思是，如果我們一直在這些牙科診所裡進行這樣的事情，我們將會在這裡進行完全不同類型的對話。但現在我們已經弄清楚瞭如何在辦公室中產生這種信心和能力，我們認為這預示著美好的事情即將到來。

Great, thank you very much.

太好了，非常感謝。

Thank you, Lucas.

謝謝你，盧卡斯。

I show no further questions in the queue. At this time, I'd like to turn the call over to Mr. Kirk Huntsman, Chairman and CEO for closing remarks.

我在隊列中沒有顯示任何其他問題。現在，我想請董事長兼執行長 Kirk Huntsman 先生致閉幕詞。

Thank you, operator. I would like to thank everyone again for joining us on today's call and for your continued interest in Vivos Therapeutics. We look forward to sharing our continued progress to you in the coming weeks and months. Thank you and have a great evening.

謝謝你，接線生。我要再次感謝大家參加今天的電話會議以及對 Vivos Therapeutics 的持續關注。我們期待在未來幾週和幾個月內與您分享我們的持續進展。謝謝您，祝您有個美好的夜晚。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。