Anika Therapeutics, Inc. (NASDAQ:ANIK) Q3 2023 Earnings Call Transcript

Mike Levitz: Hi, George, this is Mike. So first — the first part of your question around the contribution from X-Twist and RevoMotion that was the primary driver of the growth in the quarter. And I would say that that’s what drove us to double-digit growth. We also saw really strong international revenues in joint preservation in the quarter. Now I will say that some of that is timing. We’ve talked about this in previous quarters. That part of our business is through distributors. And so sometimes you can get lumpy quarters. And so we had a strong first quarter and then a lower second quarter a strong third quarter here. And so that is a lumpy part of our business, but that is a nice growth part of our business for the full year.

So that is what the primary driver of the growth was X-Twist and RevoMotion together. It’s nice to — now we’ve been on the market since the first quarter with X-Twist PEEK and are excited to see X-Twist Biocomposite coming on in the first part of next year. RevoMotion as we said moved into full market release in September and we’re seeing growing momentum there. Can you remind me the second part of your question?

George Sellers: Yes. Just curious on the increase in the guidance how much of that is related to the full commercial launch of RevoMotion?

Mike Levitz: Okay. So we increased the guidance across the business. So the increase in the guidance on OA Pain Management which we increased over $3 million was driven by the performance year-to-date and the expectations in the United States led by Monovisc and international led by Monovisc, but mostly by Cingal where we continued to see double-digit growth. So that was the biggest driver of the increase, but we also raised the low end of our range in joint preservation now that those products are like RevoMotion now launched and on the market and we’ve retired risk associated with those new products. So we’re seeing growing momentum for the X-Twist. And again we just launched the RevoMotion for market release here in September.

George Sellers: Yes. Okay. That’s really helpful. Thank you for that color. And then maybe a question on the. Integrity patch system. How many of your current surgeon customers are already using a rotator cuff patch system obviously a different one, but how many are already using that device? And I guess I’m really trying to figure out what the cadence of that growth and revenue contribution might be in 2024?

Cheryl Blanchard: Yes. George, it’s a fairly significant number that are currently using some patch. I mean there is one patch that is the market leader and that’s frankly primarily what anybody is using right now. In terms of our ramp, I mean, we are having very good meetings with surgeons right now who are very excited to get this into their practice. It’s not uncommon for a product like this for surgeons who want to do a couple see how their patients do, wait a few months before they fully adopt it kind of learn go to some training and education make sure they’re serving their patients well that they’re very familiar with the system. So I think we’re expecting to see adoption over the next year as we get this launched in Q1. But again, I think there’s a real understanding that this product addresses some pretty significant unmet needs that they all have and they’re very excited to get going with it.

George Sellers: Okay. That’s really helpful. And Mike maybe one on OpEx. Clearly some good cost controls going on from your perspective. I’m curious as we look ahead is the third quarter a good sort of run rate going forward on both the SG&A line and also the R&D line? As you sort of maybe switch out some MDR-related costs for some direct sales rep costs?