Title

Presentation

TELA Bio, Inc. misses on earnings expectations. Reported EPS is $-0.21 EPS, expectations were $-0.14.

Operator: Good day, everyone, and welcome to TELUS First Quarter 26 Conference Call. At this time, all session. To ask a question during the session, you will need to press *1 on your telephone. You will then hear a message advising your hand is raised. To withdraw your question, please press *1 again. Please be advised that today’s conference is being recorded. I would now like to turn the call over to Louisa Smith. Please go ahead.

Louisa Smith: Thank you, Carmen, and good afternoon, everyone. Earlier today, TELA Bio released financial results for the first quarter ended March 31, 26. A copy of the press release is available on the company’s website. Joining me on today’s call are Tony Koblish, Chief Executive Officer Jeff Blizard, president Roberto Cuca, chief operating officer and chief financial officer. And Jim Hagen, SVP of strategic operations and marketing. Before we begin, I would 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 quarterly reports on Form 10 Q identify the specific risk 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, pipeline opportunities, sales and marketing strategies and the impact of various additional risk factors as identified in our regulatory filings. With that, I will now turn the call over to Tony.

Antony Koblish: Thank you, Louisa. Good afternoon, and thank you for joining TELA Bio’s first quarter 2026 earnings call. I will open with a summary of what we accomplished in the first quarter and our perspective on the road ahead. Jeffrey will then walk through some updates on progress in the commercial organization and our continued execution against the plan we laid out last quarter. Roberto will review our financials, and then we will open it up for Q and A. Last quarter, we laid out a framework detailing the decisive steps we have taken to reset our commercial strategy, and Q1 results show early proof points that our strategic plan is working. We currently have the largest, most effective field team in the company’s history, and we have achieved the hiring targets necessary to deliver against our operating plan.

Our sales territories are fully staffed with exceptional talent and new hires are ramping to productivity level on expected time lines. The remainder of 2026 will be about executing on our redefined strategy, and the task ahead is to translate our US commercial resetting to measurable success. The foundational work is behind us, and we are at an inflection point that should become increasingly visible in our results through the remainder of the year. Beyond upgrading our US field team, there are several favorable tailwinds that give me confidence in delivering a strong 2026. To start, on April 1, we initiated the full US commercial launch of the OviTex long term resorbable reinforcement portfolio, which we are calling OviTex LTR. This product is 1 of the only fully resorbable tissue based hernia repair solutions on the market.

Surgeons and patients are increasingly demanding solutions that deliver durable long term outcomes while minimizing exposure to permanent synthetic materials. With OviTex LTR, surgeons now have a full suite of products that offer the critical structure and strength required in the early phases of healing while avoiding the long term risk of residual plastic material in the body. We believe OviTex LTR will be instrumental in attracting new surgeons who have yet to adopt OviTex by offering them and their patients a more effective, fully resorbable solution. We have priced OviTex LTR comparably to the rest of our hernia portfolio, preserving the value proposition for both surgeons and hospital administrators. Early feedback in the field has been overwhelmingly positive, and we believe that LTR will be a meaningful contributor to this product portfolio.

Second, we saw breakout performance in our European business with revenue growth of 41%. And as a reminder, this growth is driven entirely by our hernia portfolio as we are still in the regulatory process of bringing PRS to the market in Europe. We saw exceptional performance in the UK, we continue to deepen our presence, win new accounts, and gain clinical administrative buy in driven by our value proposition and product efficacy. As we start to scale within Continental Europe, we have found distinct unmet needs in those countries. The most pronounced being the demand from government-run healthcare systems seeking novel ways to optimize costs and patient outcomes. TELA is well positioned to win in these market dynamics. A strong validation of TELA’s value proposition came through the NHS supply chain’s value based procurement evaluation which selected OviTex for use in complex abdominal procedures.

Through independent analysis, the NHS found that OviTex has the potential to reduce the need for revisional operations for hernia recurrence, lower the prevalence of postoperative complications, improve patient well-being, and generate cost savings compared with other biologic mesh options. We believe these findings are transferable across health systems and see a clear opportunity for our products to perform just as well in additional EU markets. Finally, the quantity and quality of evidence supporting OviTex continues to grow. Most recently, a meta analysis was presented at SAGES comparing OviTex with other mesh options for ventral hernia repair. The authors were highly respected surgeons, well known thought leaders in the space, and they concluded that OviTex is a safe and effective option for ventral hernia repair.

With significantly lower recurrence rates. These data emerged alongside the publication of results from a large real world European evaluating a resorbable competing product which showed recurrence rates exceeding 20% consistent with several other studies of that product and nearly 10x the recurrence rates observed across the OviTex portfolio. Before turning it over to Jeffrey, I would also like to address the strategic board changes we announced in late April. 4 of our long serving directors, Doug Evans, Kurt Azerb Barzan, Vince Burgess, and Freddie O’Brien will be stepping down following our annual Shareholder Meeting on June 9, We are deeply grateful for their contributions and the strong foundation they helped establish for TeleBio. Coming on to the board, will be Joe who is expected to serve as chairman, Lisa Colleran, Guy O’Neill, and Paul Thomas.

Each of them has deep industry experience in scaling med tech companies and navigating strategic transformations. Bill Plavonic and Betty Jo Rocio will stand for reelection at the annual meeting and will provide valuable continuity as we reset our board composition. I am looking forward to working with this new board and believe that it will position TELA to execute with greater speed and focus as we advance our commercial strategy and drive towards sustained profitability. We exit Q1 with a strong foundation from which we can deliver against our commitments in 2026. To summarize, we have a fully staffed US commercial team, an expanded portfolio that includes 1 of the only fully resorbable tissue based hernia portfolios on the market, continued evidence supporting the significant benefits of OviTex a European business that is driving exceptional performance, and a reconstituted board of directors to help us achieve our next phase of growth.

With that, I will turn it over to Jeffrey for a more detailed look at commercial execution. Jeffrey?

Jeffrey Blizard: Thanks, Tony. On prior calls, I laid out a detailed overview of steps we have taken to recalibrate the commercial organization. And I would like to spend some time providing updates on our progress. As Tony mentioned in his comments, our US commercial organization is fully staffed now at our expected 2026 levels. Our attention shifts from recruiting and onboarding to development and execution. Mentioned in our last call that 40% of our field team was hired between Q4 and Q1. By Q2, nearly 3 quarters of those new hires will have reached their 6 month tenure at TELA. It is an important milestone As 6 months is when we typically see territory managers break-even and cover their cost. Also, it is around the same time that we see productivity inflection points when territory managers generate revenue momentum after building relationships, establish clinical credibility, and work through procurement processes training the clinical team so that patients can be treated with OviTex.

I am very encouraged by the early results from our recent hires, as they are performing well ahead of any prior class and early stage indicators, including account conversations and clinical engagement scores. The profile that we are recruiting and training for is working. Their output will follow. And we expect them to contribute at an increasing rate in the second half of this year in 2026. Previously, I also discussed how we were realigning territories to enable our field team to increase their presence in more densely populated regions with high volume potential. We are prioritizing deeper relationships within the hospital, leveraging the entire portfolio to treat more patients across the institution. We see signs of success already. Selling the full bag strategy, especially in hernia.

OviTex IHR and OviTex LPR and our fastest growing subsegments within our portfolio. This product’s mix shift is driven by U. S. Market dynamics that are moving towards a less invasive procedures, especially those performed robotically. Our year-over-year unit growth rate of 16% in OviTex shows that we are gaining market share and demonstrates that surgeons recognize TELA as the best in hernia prod products. We are primed and well positioned to capitalize on procedural trends. Whether they are shifting from robotic procedures as in the US or towards open procedures as remains the predominant approach in the UK. The launch of a long-term, long-term absorbable option across the entire hernia portfolio gives us even more optimism excuse me, that we can continue to capture procedural share.

We have the only fully resorbable tissue product line that can compete in an open laparoscopic and robotic repair across the entire spectrum of hernia procedures. Additionally, LiquiFix with its greater than 50% year-over-year growth, has been a meaningful addition to our field team. As it offers our reps a non penetrating fixation solution that helps engage surgeons who may not have previously been familiar with OviTex. Our US sales strategy pivot to deepening our presence and expanding our implanted base in target accounts was validated by observed dynamics within OviTex PRS Q1 unit volume. The unit the utilization of PRS declined in the quarter driven by the absence several of our highest volume implanters, who are not performing surgeries due to various personal or professional reasons.

This is precisely the concentration risk for our new commercial focus, which is designed to address. Incentivizing our Salesforce to mitigate these future risks like these by training additional surgeons within the same practice to use OviTex thereby reducing our dependence on any 1 single implanter to help build a broader, more durable foundation for OviTex adoption. Finally, I wanna highlight our European business and its 41% year-over-year growth. Several of the changes that we are making in the US are modeling off the success that we saw within our European team. Notably, routine presence in the Operating Room developing believers in the OviTex product line across multiple surgical specialties, at target hospitals and leveraging peer to peer networks to educate surgeons on the unique mechanism of action within OviTex.

Our European team continues to be an example of what the right talent with enough tenure they can do with a product that is effective and novel as OviTex. Surgeons want a product that provides early strength, delivers a durable repair, leaves nothing behind, and is supported by a by our robust clinical evidence. The OviTex portfolio meets these needs. We now also have the commercial engine to get the product into more surgeons hands. I am confident that the outcomes we see in Q1 validate these changes that we implemented. We have an incredible team. And we are approaching the market in a more strategic focused manner that will unlock significant opportunities for us. I look forward to updating you on our continued progress in the months ahead.

And with that, I would like to turn it over to Roberto for the financial review.

Roberto E. Cuca: Thank you, Jeffrey. Revenue for the 2026 was $19.1 million. An increase of approximately 3% compared to $18.5 million in the first quarter of 2025. Growth was primarily driven by our international business. International sales of $3.7 million, representing a 41% increase over the prior year period. OviTex revenue was $12.6 million up from $12.1 million in the prior year period. OviTex unit volume increased 16% year over year. With 5.8 thousand units sold in the first quarter compared to 5 thousand units in the first quarter of 2025. Dollar growth was partially offset by product mix. Proportion of smaller sized units increased, compressing the ASP for that line. We view this as a positive, demonstrating our hernia portfolio has the breadth and clinical efficacy to meet surgeons’ changing procedural needs.

OviTex PRS revenue was $5.9 million compared to $6 million in the first quarter of 2025. Other revenue, which includes LiquiFix, was $600 thousand. Gross profit was $12.5 million in the 2026, in line with the prior year period. Gross margin was 66% compared to 68% in the first quarter of 2025. The modest decline was driven by a higher charge for excess and obsolete inventory as a percentage of revenue. Total operating expenses were $23 million in the first quarter of 2026, essentially flat with $23 million in the first quarter of 2025. Sales and marketing was $16.5 million down modestly from $16.6 million in the prior year, with lower commission expense partially offset by higher meeting and training costs. General and administrative was $4.2 million up from $3.8 million primarily due to higher professional fees.

Research and development was $2.3 million, down from $2.5 million. Loss from operations was $10.5 million in the 2026 compared to $10.5 million in the first quarter of 2025. Essentially flat year over year. As we signaled last quarter, Q1 typically reflects a step up in operating loss relative to Q4 due to seasonal revenue and spending patterns. Additionally, the first quarter of this year included certain compensation related costs associated with completion of our hiring build out. We expect operating loss to improve markedly as revenue grows throughout the year. Net loss was $12.3 million in Q1 2026, compared to $11.3 million in Q1 2025. The increase was primarily due to higher interest expense of $2.1 million reflecting our new larger Percepta credit facility that was put in place in November 2025, versus $1.2 million in the prior year period under our prior mid cap facility.

We ended the quarter with $39.5 million in cash and cash equivalents. As per our full-year 2026 outlook we are reiterating guidance of at least 8% revenue growth over 2025, with Q2 2026 revenue of approximately $20 million. I will turn the call back to Tony for some closing remarks. Thanks, Roberto.

Antony Koblish: As we have done in prior quarters, I would like to close with a patient story that grounds us in the purpose behind everything we do. A female patient presented to a trauma center in Liverpool, UK following a fall from a height. The patient experienced severe multi organ trauma. Required damage control surgery, staged reconstruction, and careful management within a challenging surgical field, traditional solutions were limited. The local TELA Bio representative helped the surgeon identify the appropriate use of OviTex 1S to support the required reconstruction in a challenging anatomical and clinical environment. Due to the timely use of OviTex and the product’s unique mechanism of action, the patient underwent a successful abdominal wall reconstruction despite a highly complex presentation.

11 months out, the patient has no wound or mesh-related complications, thus avoiding additional surgery and a prolonged recovery. This story is a great example of how OviTex, when selected, and appropriately used as the first mesh in a patient’s treatment, helps achieve positive patient outcomes and reduces the future burden on health care resources. Before we open the line for questions, I want to take a moment to recognize the team. Amid much change, we solidified our commercial foundation launched a portfolio expansion that will benefit many patients for years to come, enrolled more patients in our clinical studies, saw our belief in OviTex reaffirmed through more published evidence, and reconstituted our board of directors. That does not happen without a team that is fully committed to the patients and the surgeons we serve.

I truly believe that we are set up for the next phase of our growth starting with the strong 2026. I look forward to what is ahead for TELA. Carmen, please open the line for questions.

Receive real-time insider trading and news alerts

Operator: Thank you so much. And as a reminder, to ask a question, simply press *1 to get in the queue and wait for your name to be announced. To withdraw your question, simply press *1 again. Our first question is from Caitlin Cronin with Canaccord Genuity. Please proceed.

Analyst (Caitlin Cronin): Hi. Congrats Thanks for taking the questions. Would love some more color on your guidance philosophy for the Q2, just given your new commercial strategy emphasizing density, was that disruptive, in Q1 as you expected? And do you expect this to have an impact in the Q2?

Jeffrey Blizard: So we used the first quarter to roll out not only a new strategy, we also, had expanding territories, a revised compensation plan. So we threw a lot at our commercial organization and then still resulted in a quarter of prior year growth. As we sit inside here at TELA Bio for what we went through changes in 1 quarter alone, not many commercial companies experienced that same amount of internal organization change. So, we were very fortunate that the team really stayed focused on the patient and the outcomes and also prepared us for launching a brand new product with LTR. So I think as we look at our training, our training has been redesigned for our onboarding classes. Trying to ramp up that speed faster for the return on really them coming and joining, the team.

But ultimately getting into these programs and establishing relationships and being bedside. So we are at that critical mark now between the 6 and 9 month onboarding time frame where we actually see that rate of return and feel really good about the second half.

Roberto E. Cuca: And I would highlight 1 thing that, Jeffrey said in the prepared remarks. Which is that we are coming up now on a pretty substantial portion of our Salesforce hitting the 6 month period. that is hitting– hit or will be shortly hitting breakeven. And as Jeffrey said, there is an inflection point in their productivity at that point. So we expect towards the end of the second quarter, beginning of the third quarter for that traction to begin exhibiting itself. And generating pretty significant revenues in the third and fourth quarters.

Analyst (Caitlin Cronin): Great. And you noted last quarter that the competitive and environment in Europe differs a bit from the US, just given the pricing and bundling dynamics. Maybe just more color on that and how that is potentially helping the European momentum.

Antony Koblish: Yeah. I will cover that, Caitlin. So Europe is a different structure. Right? Tend to have socialized medicine for the most part. That would be a good description. A lot of what is done there is based on tender offers. Where the product is evaluated by a central agency for, value proposition. That would be both an economic and clinical value proposition. So it is a fairly straightforward assessment of, all the different product opportunities, the data, how they are supported, and what they cost. it is a much more complicated picture in the US where there are cross-category bundles. There may even be wraparound rebate strategies and bundled tiered pricing. And just the mechanism that is put in place through the IDNs that roll up the GPOs and then the complex contracting strategies that large companies use large companies tend to use, it tends to make for a much more difficult and complicated situation and system.

Right? And believe it or not, in Europe, it is very understandable, and it is a wide open market if you have got the right product, with the right data at the right price point. And I would classify that as value proposition. And we certainly have that. So I think that is a perfect representation of what is possible in the US market once we start working through and have our restructured commercial strategy to break through some of those barriers and some of those opaque processes that are in place. Right? That means smaller regions, smaller territories, more focus, more depth not being as spread out as we used to be. So it is critical that we get more focused and tighter in our alignments And that is really the main reason. Great.

Analyst (Caitlin Cronin): Thank you. Thanks, Caitlin.

Operator: Thank you. Our next question comes from Frank with Lake Street Capital Markets. Please proceed.

Analyst (Ian): Hey, guys. This is Ian on for Frank. Congrats on the quarter, and thanks for taking questions. First for me, on the Q4 call, you guys had said the 40% new cohort had stepped up nicely in Q4. And, I was just wondering, did, in Q1, the productivity from that group continue stepping up at the same pace, or, did you see a more pronounced inflection in Q1 and how does that change how you are thinking about time to break out for that cohort relative to the 6- to 9-month benchmark.

Jim Hagen: Alright. And it is Jim. I will take that 1. You are right, in Q4, when we were talking about the new hire cohort, you talked about a leading indicator Of testing scores, that they were testing faster and higher Than previous cohorts. And we have seen that translate in Q1 in terms of ramp time and productivity in their first 30, 60, 90 days in a role. From the metrics we look at internally, those are trending higher than previous cohorts, which gives us, again, that bullishness that these are the right people. That we hired, We have continued to add additional people in Q1. So we are at our staffing levels for 2026 now. So just like the other cohort, they are going to need time to ramp. We still believe that 6 month inflection point is real.

They are breakeven, as Roberto talked about. And from beyond 6 months, you start to see a nice upward slope in productivity. And so that is why all the points you heard from Tony, Jeffrey, and Roberto we are confident that the back half for us is set up strong.

Antony Koblish: Yeah. That 40% of new reps will be through their 6 month bed in period or start up phase by the end of Q2. Right? So we are not seeing the full benefit of that cohort yet, but we but we see some good signals. Danny, this is Jeffrey.

Jeffrey Blizard: Just maybe for some further clarification. When we bring in a new hire, for the first 3 months, they are not in their territory. So we ship them all around, the country, both in house training, out with field sales trainers, across different regions so they can experience multiple procedures from different users. Before they ever step foot in at month 4, within their territories. You figure 3 months just to understand the geography, the maps of the hospitals, how to get in, get access. So that takes a good 3 months to establish that. And then around month 6, after 3 months of understanding their role within those hospitals, is where we see that inflection point. So I just wanna make sure that everybody understood that is a typical Yeah.

Jim Hagen: And by that, it is training our training process fully as well.

Antony Koblish: Yeah.

Analyst (Ian): Okay. Got it. Thank you. And then just 1 more for me. Can you guys provide an update on the items you called out as factors of safety related to the 8% growth rate. Specifically the contract execution timing, new rep maturation, and territory splits? Kind of how those are tracking?

Jeffrey Blizard: So a couple, and I will have Jim maybe look for some metrics as I maybe explain what makes us confident in that 8% is I think there is 4 main reasons. Right? it is our current US sales hiring and effectiveness being fully staffed at greater than 90 territory managers. We have 19 greenfield territories, so brand new markets where we were not even in. Identified around key programs, in key cities. Our EU performance, where they have come in quarter to date at 41%, they are gonna continue to trend above plan, especially given the fact that, we got a new sales leader there, 1 retired. We brought in a an excellent sales leader there who is shoulder to shoulder with his team. We have got an OviTex LTR launch. which is, you know, really the Goldilocks device in its category. We say here and then, finally, the evidence that is being published about some other competitive products in the space that we play in. So we are we are bullish around that 8% number.

Antony Koblish: Yeah. The profile for our product is rising. in the US. And I think we meet that opportunity with a fully staffed Salesforce with 19 or 20 new greenfield territories. Right? So these are some of the elements that we have layered together. To give us confidence.

Jim Hagen: Maybe the last comment I would add too is with what was not mentioned in our prepared comments was the investment in medical education. And we continue to do that with adding labs getting didactic programs built, peer to peer programs, And that is where really the rubber hits the road in med device when surgeons can see this used up close. And be in settings outside of their programs. To ask questions and see how this applies to patients. We have 40 surgeons coming together this weekend. And we have done several of these programs this year. So that is also loading the pipeline as well.

Analyst (Ian): Okay. Thank you, guys. Thanks, Ian.

Operator: Thank you. Our next question comes from Michael Sarcone with Jeff. Please proceed.

Analyst (Michael Sarcone): Hey. Good afternoon, and thanks for taking our questions here. Just to start, I wanted to ask on guidance maybe in a different way. You have elaborated a lot on the drivers you have got at TELA, what gives you confidence in that really helpful color. I appreciate that. I guess, can you speak to the level of visibility into customer demand trends that you have got in the business as it stands today and just trying to attack that 8% from a different way here.

Jim Hagen: Yeah. Michael, it is Jim. I will take that 1. So we referenced not just the revenue, performance, but the unit performance. And so it is in the hernia portfolio alone, we are seeing a 16% unit growth. So I think that hits the demand. Side of the equation you are talking about. Surgeons are voting with their procedures, and they are selecting us more often. Now that is also in the context of a US market where we do see a trend towards less invasive procedures, We fortunately have the portfolio that is set up to adapt whether surgeons want to go open, laparoscopic, or robotic. With that drive towards laparoscopic robotic, we do see our OviTex LPR, another OviTex IHR. As the portfolio continue to grow, And we still see growth in 1S and Core.

But that product mix shift is changing, I would say, kind of, the overall picture of the revenue story. So units continue to grow. So demand, we believe, is truly there. The mix shift will continue. For the rest of 2026. And so we do expect unit growth to strip revenue growth for the rest of the year. But it is what is giving us confidence in saying we are taking market share. And surgeons are more and more adopting OviTex in these procedures.

Antony Koblish: Yeah. We are perfectly aligned with the robot, which is where the bulk of these hernias are going. Certainly, the simple inguinal, hiatal, simple ventral, they are all there already. And more and more complicated procedures are going in that direction. So we have a product portfolio that can function, and be highly compatible with the robot. for each 1 of those types of procedures. And at the end of the day, we want to be a full hernia supplier. Which means we have got to be in, you know, the 600 thousand 700 thousand 800 thousand inguinal and all the procedures. that is where the volume is, and so we are very gratified to see that the unit growth continues to be strong. Right? Eventually, things will balance out, and revenue growth and unit growth will catch up with each other.

But right now, we are very happy to see unit growth strong. That means our IHR and our LPR, which stands for low profile robotic, are leading the way which is the way it should be given the way the architecture of the market is setting up right now.

Analyst (Michael Sarcone): Okay. really helpful. Thank you. And then just, you know, on PRS, I think in the prepared commentary, you mentioned utilization decline. Due to the absence of some of your high volume implanters. Can you talk about what is baked into the guidance for the PRS side of the business? You know, are you expecting to recapture some of that utilization through the year? And any color there would be great. Thank you.

Jeffrey Blizard: I will start and this is Jeffrey. Our ASP is really high on these products. but it is also comprised of a smaller percentage of our implanters. And when a few went out on maternity leave, a few on vacations, oral boards were also during this first quarter. Which, we saw a drop in our PRS business. This is why we knew we had to reconstitute our strategy around building a user base and not be dependent on these key users. So we will see some of that in Q2 as we have done a Salesforce realignment by adding a bit more focus on PRS. Expanding the bag here for our sales team. So that will give us more depth in these accounts, more users per site, and ultimately why we rescoped, again, our commercial organization efforts. We need these downturns to stop and not be reliant, especially if they are critical events that we did not account for.

Antony Koblish: Yeah. We have got to overcome the rule of small number of implanters and high ASP on that product, Michael. So that is that is the way the design of the sales force is set up. Right? Deeper. More users per site versus what we have had in the past. that is the only way through that phenomena.

Analyst (Michael Sarcone): Got it. Okay. Thank you, guys. Thanks, Mike.

Operator: Thank you. And as a reminder, to ask a question, simply press *11 to get in the queue. Our next question comes from the line of Matthew O’Brien with Piper Sandler. Please proceed.

Analyst (Matthew O’Brien): Afternoon. Thanks for taking my questions. And I am sorry to beat this dead horse. on the line, but the back half ramp is steep. You guys have talked a lot about how you are going to get there. But if I look at 2023 when you had you know, a pretty stable Salesforce, especially beginning of year, It definitely increased throughout the course of the year, but you had the same number of reps back then. And you did about 55% of revenues in the second half of the year back then. that is what you are calling for here in 2026 with a sales group that is maybe a little bit more green than what you had back then. So what are you seeing maybe April, May, if you can talk about that at all, that gives you so much confidence. And then you know, rep retention, obviously, is something that is fluctuated a little bit over the years. at TELA, why the confidence that you would be able to retain this group? And then I do have a follow-up.

Jeffrey Blizard: Yeah. This is Jeffrey, and, thanks, Matthew, for this question. And I refer back to prior years of, really, from my perspective, I do not have that history. 1 is, I can assure you that, there was not great data at that point, which we now have. We did not have much process. Instilled and discipline, which we now have. And a bit of the territory alignment organization, great key leadership. And field leaders right now, which we did not have and now we have. So if you are looking at prior years to current, again, I would tell you that we are set up for success. even versus, you know, what our goals have been. We have been really aggressive to do this quick over the last 2 quarters. Again, I do not think many commercial organizations would have implemented and sustained the amount of change we have implemented.

So to me, I am confident in the back half of the year Our training programs internally support this. So not only do we do medical education for our customers, but we also do it for our teams. We are giving them the right resources and tools. So Jim?

Jim Hagen: Yeah. And I would say the 2 other parts, Jeffrey mentioned the clinical evidence, In Jeff’s remarks, he mentioned the data that came out in stages. I think it is not just the evidence, it is who is publishing the evidence. From 2023 till now, as we go up the adoption curve, we are seeing more influential and bigger named surgeons with large peer networks in the hernia space start to adopt our product. That peer network is a critical part of Momentum build that we did not have in 2023. that we are gaining now. And we also just launched OviTex LTR, which really is the matchup in the fully resorbable category, which is the largest growing category in hernia, which we did not have in 2023. So I would say between the talent we brought in the new part of the portfolio, the market dynamics of kind of more influential surgeons publishing data on us and adopting us, are the tailwinds we did not have in 2023.

And that is kind of what gives us the confidence for the back half of this year.

Operator: And, Matthew, maybe just to close was your question on retention.

Jeffrey Blizard: And our recruiting efforts, have become streamlined through, Jennifer Armstrong, our senior vice president of HR here. We have panel interviews that ultimately end with Jim and I, doing the finals. And what we have found in our last, say, 30 hires, is it feels as though and communicated to us that we are becoming a destination. That a lot of people want to be on this team, given where we what we have for innovation, pipeline, trajectory, and the leaders that are in the field. So we have been very lucky, that, people are doing the research on us and these interviews are them, wanting to be here. So a bit of that retention, starts within the interview process.

Roberto E. Cuca: And, Matthew, I would add just 1, additional thing, which is that in 2023, what you saw is a sales force that was pretty that was sized pretty similarly to that in 2022. so the growth that you saw over the course of the year in 2023 was with an in-place sales force. And so you got that 55%, or 55% split of revenue in the second half versus the first half. The difference in 2026 is that we have added a number of sales reps at the end of the fourth quarter and the beginning of the first quarter who will begin to get traction will hit that inflection point that Jeffrey talked about right around the midpoint of the year, so the end of the second quarter, beginning of the third quarter, and we will be adding to that growth and further reducing disproportionately in the second half versus the first half.

So it is that growth in the sales force that was completed at the end of the year and beginning of this that makes us comfortable with the, call it, skew between the second versus the first half in our guidance.

Analyst (Matthew O’Brien): Okay. Appreciate that. And then question for Tony. Tony, you know, the board changes are notable. I mean, you are you are losing some really good executives, but adding some seasoned executives I mean, they are it is a pretty illustrious group with a long history in that space. How can they influence TELA, you know, over the next several years with their experience to help TELA sell what is still the best product on the market. By far?

Antony Koblish: I think that is a great question, and I appreciate the leadin for that. So look, as you know, it is customary to refresh a board. Right? You know, we are 5, 6 years post IPO, which is really when this board came together. And we had some board members on much longer than that. But I think it makes sense to refresh as the company develops and gets to a new phase of demand. And our previous board served us exceptionally well, bringing us through those earlier phases. But, you know, I have got some experience with the new the new team coming in. And what is important about this new team is that they have a tremendous amount of experience in implant based medical device biologic biomaterial products. Right? Everybody that is coming in has really relevant experience, whether it is in hernia, whether it is in plastic and reconstruction, or whether it is any implant based biologic that has a mechanism of action.

Know, has a contracting profile. Right? it is just a very tightly aligned group of new board members that have the exact experience to guide us through this next phase. The alignment could not be better And like I said, originally, I do have experience with you know, several of these folks working with them in past and different capacities as well. So to me, it is a very good fit for what we need going forward.

Operator: Thank you. And this will conclude our Q and A session. I will pass it back to Tony Koblisch for closing remarks.

Antony Koblish: Alright. Thank you very much, Carmen. This is an exciting time for TELA. We have a full complement of highly skilled commercial team members in The US and UK. 1 of the only fully resorbable tissue based portfolios on the market. More clinical evidence that clearly demonstrates the significant benefits of OviTex a European business that is overperforming and can be a very good model and direct indicator of what is possible in The US given time and pressure and development. And we have a new board of directors that is highly aligned with our mission and has the exact experience that we need to achieve our next phase of growth. So with that, I also wanna thank the Tella employees whose dedication and commitment to patients which is most paramount. That we serve have created a strong foundation from which we can sustainably grow for years to come. Thank you very much. Have a great night.

Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.

Receive real-time insider trading and news alerts