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Operator: Good morning, and welcome to TriSalus Science Second Quarter 2024 Earnings Conference Call. Currently, all participants are on 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.

Jim Young: Thank you all for participating in today’s call. Joining me today from TriSalus Life Sciences are Mary Szela, President and Chief Executive Officer; Sean Murphy, Chief Financial Officer; Dr. Alex Kim, Senior Vice President, Interventional Radiology; and Dr. Steven Katz, Chief Medical Officer. Earlier this morning, TriSalus released financial results for the second quarter ended June 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.

Mary Szela: Good morning, and thank you all for joining today’s call. This quarter, we made significant progress in advancing our strategic priorities and continued to achieve robust revenue growth. Today, we’ll discuss the key highlights of the quarter and provide updates on our pioneering drug delivery technology, the PEDD technology and our promising investigational therapeutic, nelitolimod, for liver and pancreatic indications. Starting with our second quarter performance, I’m thrilled to report a substantial growth of 60% in TriNav revenues compared to the second quarter of last year. This impressive growth driven by permanent specific reimbursement, compelling clinical data and the expansion of our sales force reinforces our status as one of the fastest-growing med tech companies in the United States, marking another consecutive quarter of over 50% growth.

As previously shared, we’re actively engaging with the interventional radiology community and hospital communities to disseminate the outcomes of our recent health economic and outcome research study. This study highlighted the value of the TriNav system, particularly in treating complex patients with diverse clinical challenges and large tumor burden in the liver. In short, the study demonstrated economic and clinical benefits to using TriNav system to treat sicker, treatment refractory and higher disease burden patients. And given the high unmet medical needs of these patient population and the significant impact of our technology, we are planning to launch a series of investigator-initiated clinical trials focusing on various complex patient types across numerous research sites and institutions in the US.

This comprehensive clinical initiative aims to gather real-world clinical use data and further evidence supporting the use of TriNav technology in complex patient populations. This program named the DELIVER program is designed to further demonstrate TriNav’s enhanced efficacy and safety across a broad spectrum of complex patient populations who may otherwise not be candidates for case and care procedures. We define these complex patients as those involving one or more of the following, previous embolization in therapy, multifocal diffuse or bilobar lesions, large tumors 8 centimeters in size, multiple comorbidities, including liver dysfunction, hypovascular tumors and diffuse tumors throughout the liver. A new complex patient type has emerged based on the work of Dr. Juan Camacho from Sarasota General Hospital, who achieved significant treatment success using bland embolization via the TriNav technology for multinodular goiter.

Later in the call, Dr. Alex Kim will discuss the inherent benefit of transarterial embolization with the TriNav technology compared to competing therapies. The DELIVER program encompasses a series of investigator-initiated clinical trials involving numerous research sites and hospitals across the United States, enabling access to a wide range of complex patient population and clinical outcome data collection. A central theme of this program will be to investigate innovative approaches to highlight the impact of improved therapeutic delivery and enhanced safety through sparing of normal tissue when using the TriNav system in these complex patients. Essentially, our goal is to explore the potential of combination therapies with transarterial chemo and radio embolization delivered via the TriNav system, which we expect will demonstrate enhanced efficacy and overcome resistant mechanisms in difficult-to-treat cancers.

We expect soon to initiate the first of our investigator-initiated clinical trials under the program called PROTECT or Pressure Enabled Retrograde Occlusive Therapy with Embolization for Control of Thyroid Disease, which aims to demonstrate the benefits of this approach versus surgery. We also intend to deliver studies to include [indiscernible], which stands for embolization of liver metastasis in anatomically complex patients for therapeutic enhancements, integrating Y-90 and the TriNav system with systemic therapy for patients with anatomically complex, colorectal and neuroendocrine liver tumors. The second study is SPARE. It stands for pressurized redistribution of embolic chemotherapy investigation for safety enhancements. This focuses on the benefits of TriNav system with chemoembolization and complex sarcoma liver tumors.

And the next study is called PRECISE, it stands for embolization of liver metastases and anatomically complex patients for therapeutic enhancement, [indiscernible] plus the TriNav system with systemic therapy for patients with anatomically complex colorectal and neuroendocrine liver tumors. We emphasize patient centricity in all our clinical trials, aiming to improve the overall patient experience during the procedure. This includes reducing the burden on patients, improving education and ensuring their voices are heard throughout the clinical trial and development process. Importantly, the safety and tissue sparing effects of our technology may enable patients to be treated with embolization who have not been eligible previously. Additionally, we believe these studies will allow us to update our real-world evidence to complement our clinical data and ensure we understand how our technology performs in everyday clinical practice.

We will leverage advanced data analytics to generate insights from complex patients and data sets within our real-world evidence approach. Overall, the DELIVER program exemplifies our commitment to transforming the care of patients undergoing intravascular procedures for treatment of solid tumors or benign conditions with similar mechanical treatment barriers, ultimately striving to deliver a life-changing impact to the patients we serve. Regarding our pipeline, we plan to initiate the full launch of TriNav Large system later this year as well as share the full clinical results of PERIO-01, our Phase 1 clinical trial for uveal melanoma liver metastases and PERIO-03, our Phase 1 clinical trial for locally advanced pancreatic cancer. At the end of the year, we’ll provide results of PERIO-01 and PERIO-03 which will reform our next steps in clinical development in combination with the TriNav system.

I’ll turn the call to Dr. Alex Kim, our Senior Vice President of Interventional Radiology to share further details on the initiation of PROTECT for multinodular goiter and then have Dr. Steven Katz, our Chief Medical Officer, briefly summarize the results of PERIO-02, our Phase 1 trial in intrahepatic cholangiocarcinoma and hepatocellular cancer. Before I hand it over to Alex, I want to conclude by saying, we’re pleased with the company’s progress and confident in our ability to execute our company building strategy. We remain on track against our objectives to achieve over 50% top line revenue growth, advance our pipeline, and strengthen our operational foundation. Alex, over to you.

Alex Kim: Thank you, Mary. I am excited to speak to you about our new registry study, evaluating the real-world experience assessing the safety and efficacy of performing thyroid artery embolization or TAE with the TriNav device. TAE is an emerging procedure being developed to treat thyroid goiters. The current standard of care is for patients to undergo surgery or radiation treatment for this benign disease, both of which are associated with significant comorbidities, including hypothyroidism and nerve injury. While TAE may significantly reduce or eliminate these risks, thyroid embolization itself carries with it a risk of stroke, which has muted the enthusiasm for this procedure in the interventional radiology community. We believe that performing TAE with the TriNav system will significantly reduce the risk of stroke as the PEDD effect of the TriNav system eliminates the need to catheterize the superior thyroid artery for treatment where the great majority of the stroke risk from TAE resides.

Dr. Camacho, who Mary mentioned earlier, introduced an approach in which PEDD TAE is performed only with catheterization of the inferior thyroid arteries, which do not directly communicate with the cerebral vasculature. Dr. Camacho has currently performed over 25 PEDD TAE procedures to date without any cerebral adverse events and is currently developing a manuscript to describe his initial experience. Based on the mechanistic rationale and the early safety and efficacy data, we believe that PEDD TAE can be transformed in the treatment of the 50,000 or so patients who currently undergo thyroidectomy for benign thyroid disease and has the potential to become the standard of care for this disease process. We are enthusiastic about the potential for this application to deliver better safety and efficacy to this large patient population.

I would now like to turn the call over to Dr. Steven Katz, our Chief Medical Officer, to speak about our PERIO clinical trial.

Steven Katz: Thank you, Alex. As you know, we opened three Phase 1 trials studying liver metastases, primary liver or bile duct cancer and locally advanced pancreatic adenocarcinoma to test three hypotheses, one, the pressure enabled drug delivery, or PEDD method, would overcome delivery challenges historically associated with toll-like receptor or TLR agonists and other innate immune stimulators. Two, nelitolimod could eliminate suppressive immune cells, including myeloid derived suppressor cells or MDSC in the liver or pancreatic tumors while promoting broader immune stimulation and T cell recruitment. Three, delivering nelitolimod via PEDD could improve clinical outcomes when combined with systemic checkpoint inhibitors and patients typically considered to be refractory to these agents.

Last fall, we reported initial Phase 1 results for PERIO-01 and PERIO-03 at the SITC meeting. PERIO-01 focused on patients with uveal melanoma liver metastases and the SITC presentation highlighted a tolerable safety profile, evidence of liver metastasis MDSC depletion and encouraging signals related to ctDNA or circulating tumor DNA responses, disease control and survival in largely pretreated patients. The PERIO-03 data was locally advanced adenocarcinoma data for pancreatic cancer patients, and we focused on the initial three patients to highlight the early tolerability of nelitolimod given directly into pancreatic tumors via PEDD and the immune signals aligned with what we reported in the liver cancer patient trials. PERIO-03 remains open at MD Anderson.

We plan to report the final Phase 1 results for both programs by the end of this year. The PERIO-02 study enrolled patients with hepatocellular carcinoma, HCC, or intrahepatic cholangiocarcinoma or bile duct cancer. The primary objectives of PERIO-02 were to explore the safety of giving nelitolimod into the liver via PEDD in combination with systemic checkpoint inhibition and largely treatment refractory patients who often have underlying liver disease, including cirrhosis. The study is complete and our investigators from MD Anderson recently reported at ASCO 2024 on 23 patients across dose levels and cohorts. Let me walk you through the overall results. We’ll begin with safety. Overall, the safety profile was similar to the reports from the uveal melanoma and pancreatic adenocarcinoma patients with a Grade 3 or higher treatment-related adverse event rate of 13%, which we were pleased with, given the underlying liver disease typically present in the HCC and cholangiocarcinoma patients.

We believe this further supports the potential of PEDD to deliver immunotherapeutics in advanced liver and pancreas cancer patients. The immune monitoring data also aligned with prior reports from PERIO-01 and PERIO-03 with evidence of MDSC depletion and T-cell recruitment into immunologically cold tumors along with evidence of systemic immune activation. We tested three doses in the study, 2, 4 and 8 milligrams of nelitolimod. And while efficacy was not a primary objective of the study, we observed evidence of disease control when using the checkpoint inhibitor doublet of ipilimumab and nivolumab in combination with nelitolimod via PEDD. Approximately two-thirds of patients had intrahepatic cholangiocarcinoma and the remainder have had a hepatocellular carcinoma.

Importantly, at enrollment, 83% of the patients overall had received two or more lines of prior therapy, indicating that this was a very difficult-to-treat population. We did not see any evidence of clinical activity for nelitolimod monotherapy, or nelitolimod combined with single-agent checkpoint inhibition using pembrolizumab. However, in the 12 patients who received nelitolimod via PEDD in combination with ipi and nivo, the disease control rate was 42%, with an overall response rate of 17% and historically, we would typically expect a response rate of 10% to 12% in previously treated cholangiocarcinoma patients. Within the 4-milligram dose group in patients who received ipi/nivo in combination with nelitolimod, all three patients had disease control as best on-treatment response, including one partial response and one complete response.

The overall survival for the group is still evolving with five of 12 patients remaining alive beyond seven months and a median of eight months. While we are pleased to see the consistency in safety and immunologic effects, along with encouraging outcomes in a limited number of patients in the checkpoint doublet cohort, the data from the cholangiocarcinoma and HCC patients was too limited for us to proceed, and therefore, we do not intend to proceed to Phase 2 with this regimen. There is investigator interest in exploring nelitolimod in combination with transarterial chemoembolization or TACE or transarterial radioembolization TARE for these patients, and we may consider investigator-initiated studies in the future. Despite this decision on PERIO-02, we continue to be pleased with the results in PERIO-01 and PERIO-03, and we will provide an update on our plans for further development in these indications by the end of the year.

With that, I would like to turn the call over to Sean Murphy, our Chief Financial Officer; who will provide financial highlights of the quarter.

Sean Murphy: Good morning, everyone, and thank you, Steven. I am pleased to report that TriSalus achieved outstanding results in the second quarter that ended June 30, 2024. Our revenue, solely driven by the success of the TriNav device in the US, reached $7.4 million in the second quarter. This sales achievement represents the highest quarterly sales in the company’s history, reflecting a strong 60% increase compared to the same period in 2023. Revenue in the first six months of 2024 reached $13.8 million, representing growth of 82% compared to the first six months of 2023. In the quarter, we captured 27 new hospital accounts, and our account utilization reached 15.2 units per account compared to 12.4 units per account in the second quarter of 2023.

TriSalus has a track record of growth, as illustrated on Slide 1, which demonstrates that the company has grown at a compound annualized growth rate of over 50% since our product launch in 2020. We continue to forecast 2024 growth over 50% and the segment of the business, excluding nelitolimod clinical costs is expected to approach positive EBITDA late in 2024. We are proud to report a very strong gross margin profile of 88% in the second quarter of 2024 and 86% year-to-date compared to 83% and 81%, respectively, in 2023. This continued favorable margin profile in 2024 can be attributable to increased factory volumes, improved batch yields and other operating efficiencies. Of note, we are positioned well for the long term as our manufacturing facility in Westminster, Colorado can support our growth over the next five years with minimal capital investment.

Regarding our investments in research and development, expenses for the second quarter and the first half of 2024 totaled $4.7 million and $10.5 million, representing decreases of 32% and 16%, respectively, compared to the same periods in 2023. As noted in our first quarter call, we expect our clinical costs to continue to decrease over the balance of 2024 as we finish patient follow-up and analyze data from the trials. Our investment in sales and marketing continue to increase in support of our growth strategy. In the second quarter and the first six months of 2024, we invested a total of $6 million and $12.7 million, respectively, representing increases of 72% and 88% compared to the same period in 2023. These investments are closely tied to our ongoing sales force expansion from 10 representatives at the beginning of 2023 to our current level of 27 representatives and seven clinical specialists.

Over the balance of the year, we will be adding 10 additional personnel to our team of representatives and clinical specialists to drive continued high uptake in our accounts. General and administrative expenses totaled $4 million in the second quarter and $8.6 million in the first six months of 2024, representing a decrease of 19% in the second quarter and an increase of 1% in the first six months compared to the same period in 2023. The second quarter spending levels represents a more steady state compared to the last several quarters, which we had larger increases due to becoming a public company in August of 2023. Our operating losses for the second quarter and for the first six months of 2024 totaled $8.2 million and $19.9 million, respectively, compared to losses of $11.4 million in the second quarter and $21.6 million for the first six months of 2023.

As mentioned earlier, the decreased losses in 2024 can be attributable to increased sales, improved gross margins and lower research and development costs. These improvements were partially offset by higher sales and marketing expenses to support our growth strategy, as previously noted. Before I move to the balance sheet, let me speak to our announcement in June that we were negotiating the exchange of 79% of our publicly traded warrants and 10% of our private warrants outstanding. On July 1, we closed the transaction and issued 2.1 million common shares in exchange for over 7 million warrants in the exchange of 0.3 shares of common stock for each tendered warrant. The purpose of this offer was to simplify our capital structure, reduce the potential dilutive impact of these warrants and provide the company with more flexibility for financing and future operations.

With regard to financing, we closed a debt financing facility in April with OrbiMed. Under the terms of the credit agreement, we borrowed $25 million at closing and have an aggregate up to an additional $25 million available in two tranches at our option, subject to the achievement of certain revenue thresholds. Moving to the balance sheet. We ended the quarter with $16.5 million of cash and cash equivalents. The financing I just spoke to, assuming we borrow the full $50 million along with our current cash on hand and other existing sources of liquidity, is expected to provide sufficient cash runway to fund the operation through the end of 2025. Looking forward, we continue to forecast 2024 revenue growth over 50%. With our commitment to top line revenue growth and operational efficiency, I am excited to report that excluding nelitolimod costs, we expect to approach positive EBITDA late in 2024.

And now, I’ll turn the call back to Mary for closing remarks.

Mary Szela: Thank you, Sean, and a warm welcome to all participating in the call today. In brief, we at TriSalus are thrilled to share the significant strides we’ve made in bolstering our TriNav business and advancing our PERIO clinical programs. I want to thank the TriSalus team for their unwavering commitment to our patients, strategy and mission. Their performance has propelled our company forward on multiple fronts. With that, I’m pleased to open the floor to answer any questions you may have. Your interest in our company and your inquiries and perspectives are genuinely valued.

Operator: [Operator Instructions] Our first question comes from the line of Justin Walsh from JonesTrading.

Justin Walsh: Hi, thanks for taking the questions. Congrats on the progress. I’m wondering if there’s any context you can provide in terms of patient numbers for the types of complex patients you’re looking at in your DELIVER program.

Mary Szela: I’ll hand it over to Steven. Do you want to address that, Steven?

Steven Katz: Yes, Mary. Happy to do so. So the initial patient population that we’re going to be addressing in the DELIVER program, our patients with multi-module goiter, thyroid goiter in the PROTECT program. We estimate that the total addressable market could get up to 50,000 patients. And we look forward to seeing the early data from that program early next year. We also consider that a segment of the colorectal cancer liver metastasis patient market, in addition to hepatocellular carcinoma, are complex patients as well.

Justin Walsh: Got it. Thanks. And one quick follow-up for me. I’m wondering what you guys are looking for in the PERIO-01 and PERIO-03 results to convince you to move forward in those indications?

Mary Szela: Sure. I’ll take that. That’s a really good question, Justin. One of the things that we’re doing as a company, when we went into the wide array of Phase 1 trials, what our mission was to define an indication where we had a very significant treatment effect. We wanted to have a large market and we wanted to be in a position where we knew we could have a regulatory program that would be straightforward and ultimately, a smaller program that we potentially could fund ourselves. So, as we look at the criteria across the data, we’re really pleased to see the favorable data that we see in the clinical trials but it’s really going to be a decision based on those parameters moving forward, and we’ll announce that in the fourth quarter.

Justin Walsh: Great. Thanks for taking the questions.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Bill Plovanic from Canaccord.

Unidentified Analyst: Hi, Mary and everyone. It’s John on for Bill this morning. Thanks for taking our questions and congrats on the quarter. I wanted to start just on the PERIO trials and the updates you gave today. For HCC and ICC in PERIO-02, is this really because of resource limitations, not pursuing this further? Would you look to pursue this further in the future if you have the resources to do so down the line? And then just on PERIO-03 and PERIO-01, if the data sets are both compelling, would you go and pursue both opportunities and advance trials? Thanks.

Mary Szela: Great question. I think you hit the nail on the head. I think what we’re trying to do is the data in PERIO-02 and actually Dr. Javle out of MD Anderson, who is our lead investigator, is incredibly enthusiastic about it. I’ll have Steven comment. And it’s really that criteria that we were looking at and our ability to fund. And so that’s really the decision we made. If we have the financial resources, we would clearly move forward on PERIO-02. Steven, do you want to comment?

Steven Katz: Absolutely. Yeah, the PERIO-02 data overall were quite encouraging. Firstly, the safety data were very consistent with what we’ve been seeing in the other programs. In particular, the treatment-related adverse event rate Grade 3 or 4 was 13%, which is notable because these patients have underlying liver disease, including early cirrhosis. The immune effects that we’re seeing with nelitolimod that we did see with the HCC and cholangiocarcinoma patients are also very consistent with what we saw in uveal melanoma and the early data from the PERIO-03 pancreatic adenocarcinoma trial. And then as noted in the summary, we did see some encouraging survival signals in heavily pretreated patients, including a complete response in the fifth line cholangiocarcinoma patients. So the data overall were encouraging, but as Mary noted, in the short term, we’re making some strategic decisions to allocate our resources most effectively.

Mary Szela: And John, I’ll come back and answer the second question on PERIO-01 and PERIO-03. The one challenge we have with PERIO, which I know you’ve seen some of the data that we released today, which is quite favorable. The challenge with that indication for us is going to be, and we’ll have to make this decision at the end of the year. It’s just a very small patient market, it’s roughly 1,200 patients per year. So we’re going to be weighing that against PERIO-03 which is a much larger and much more significant indication. So, obviously, all those factors will come into our decision in the fourth quarter.

Unidentified Analyst: Great. Thanks. And just as a follow-up on TriNav itself, just two questions there. TriNav Large will be launching towards the end of the year. Is that the same ASP as the regular TriNav. And then just on the thyroid opportunity in PROTECT. I just want to confirm this would be just embolization, it’s not radioembolization, right? I think you may have said bland. Is this modular and coiled or just more color around that would be great. Thank you.

Mary Szela: Sure. For TriNav Large, it’s going to be the exact same price. So it’s just a larger vessel size, so they would be priced identically. And secondly, it is going to be bland B. I don’t know, Alex, if you want to make some further comments on that.

Alex Kim: Sure, happy to. So yeah, these are going to be bland embolization using particles of the interventional radiologist choice. So these are analogous to how uterine fiber internalizations are done currently with land particles that are attached to chemotherapy or radiation just delivered through the superior thyroid artery.

Unidentified Analyst: Great. Thanks again for taking our questions.

Operator: Thank you. At this time, I’m showing no further questions. I would like to turn the conference back over to Mary Szela for closing remarks.

Mary Szela: Thank you again, everyone, for joining the call today. We really appreciate your interest and your active following of the company. Thank you.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.