Shoulder Innovations | Dave Blue, CCO

(Transcription)

Dave Blue  0:04  

It's great to be with you. I'm David Blue. I'm the Chief Commercial Officer for Shoulder Innovations. And Matt Ahearn and I are going to present to you this morning Matt's our chief financial officer and our Chief Operating Officer. And we're going to tee up a video here that I'm gonna show here in just a second. But it's really interesting. Matt and I were here two years ago, to your point, Peter, this conference, Scott and his team have just done a phenomenal job. But we walked out of this conference with $22 million invested in us after we presented two years ago. So it's been an incredible journey over the last two years in a blur of innovative productiveness. And so we're going to share an update for you on that as well. But I think the next is the video. So if you want to play that form, it'd be great. It's hard to squeeze two years into 52 second video. And we'll cover a little bit more here for you. Matt and I talked about this leadership team, I one of the slides just went by kind of fast there. Sorry about that. This group has been together for 38 years. And I've been a part of that. And Matt and I've worked together now for the last six years. But one of the things we talked about two years ago was what an incredible opportunity to work side by side with some incredible innovators. This group represents bringing the first shoulder modular shoulder system to the US the first reverse shoulder to the US, the first stemless shoulder to the US the first 3d software planning shoulder system to the US as well as Now recently, our AI embedded 3d software planning system that is through now the new FDA guidelines. So it's just been amazing what this group has done. Well, this journey started 13 years ago, a surgeon inventor named Dr. Steven Gunther, he invented a inset glenoid to really address shoulder arthroplasty glenoid loosening, it was one of the most challenging things for shoulder surgeons. And he invented this to address those complicated cases. And the fact that you know, glenoids were coming loose. So we bought the company. And then we've been rebuilding this whole thing for the last six or seven years. And we built it on the base of this inset technology. We've added to it over to the left, you'll see that angled dilutable. Inset glenoid. That's been a revolutionary because ours is done completely different than the rest of the competition. Over on the right you'll see a stem that's the shortest stem on the market on the humeral side. That was something we brought out about two and a half or three years ago. And it's the most bone preservation stem on the market. And then we last year in released our reverse shoulder arthroplasty, which is a convertible from the stem that you see right above it. And so this becomes this integrated platform system that all works off of one set of instruments. Last Friday, we just received FDA clearance on our stemless down in that bottom left. And this group of products that we've invented now addresses 85% of all shoulder arthroplasty. So we've got some stuff in the works to address that last 15%. This 3D ai driven software planning, we were fortunate enough to be a part of inventing this first one several years ago. But we had an opportunity to take it to a whole nother level. And we use gamer developers to transform how we do planning. And it's quite amazing because the technology is so advanced from what we did originally. And this is out and through the new FDA guidelines on AI as well. So we're really fortunate to have this in our bag as well. I like this picture because it shows the back of a rep truck. All these years we've been Driving bigger cars and hauling tons and tons of instruments. We built this system with the end in mind to have an integrated platform system that's driven off of one tray of instruments. We're driving cost out of healthcare, we're driving cost out of a very expensive industry in orthopedics, that you got to have all these trays. So that one tray that circled there is equivalent to the five trays, it does exactly everything that the competitor does. And that one tote is the implant. So not only have we addressed the instrument side, we've addressed the implant side and reduce the cost. I'll give you one example, the number one competitor in the country that we were a part of that we left to do this had 24 humeral stems just to do a total shoulder. Ours has three. So if you think about the impact of what that can do to help reduce costs, it's really been amazing. But all along our goal was to drive to the ambulatory surgery center. And that's what we've been doing. So Matt is going to come up and walk us through the rest of this slide, sir.

Matt  6:07  

Thanks, Dave. Mission accomplished I didn't trip. So we'll go from there. So we've built a great foundation at shoulder innovations. We have excellent financial partners, with us Venture Partners, Lightstone ventures, Silicon Valley Bank, the team that Dave described, has designed, developed commercialized over 50% of the shoulder replacement implants on the market today. And we have implemented the systems the processes and facilities to scale shoulder innovations to $100 million worth of revenue. So you know, our foundation is definitely in place, and we're ready to scale. Our product foundation is also in place. Our commercial team has a full bag to support both anatomic and reverse procedures, which as David mentioned, is about 85% of the elective shoulder replacement market. Additionally, we've done over 3000 cases with our inset technology. And as that FDA clearance that we got last Friday was just huge for our business, super exciting, and was kind of the last piece of our puzzle. So we're ready to scale into that leadership quadrant. And ultimately, what we need to scale into that leadership quadrant is to invest into our commercial and distribution operations. And we're prepared to do that on our own. And we're also prepared to do that with a strategic partnership. So we've had a lot of strategic interest in our business over the last 18 to 24 months, the strategics recognize and understand that shoulder innovations is built the platform for the shoulder replacement market for the next the next decade. But the strategics also recognize that the brand we've built the experience team that we have in place, and our digital platform can be very, very helpful to their core business. And we certainly recognize that a strategics. You know, commercial and distribution operation can be incredibly helpful to ours to help us scale and scale more rapidly. So you know, that truly synergistic Win Win relationship. But we're also prepared to scale Shoulder Innovations on our own. We have the team, the technology, the relationships, and the financial partners to do that on our own. So we're going to do just under $15 million worth of revenue this year. And then we'll scale on to 55 to $60 million over the subsequent 24 months, we are raising a $5 million equity round right now. That'll take us into mid to late '23, at which point we'll raise a more substantial crossover round, to take shoulder innovations onto what's next after that. So we're doing the right things to build a market leader in extremities. So we couldn't be more excited about what we've accomplished and where we're headed. You know, we're solving clinical problems on a large and growing market. We've done 1000s of cases. We have excellent, excellent clinical data. And we have a team that's done it before and that's going to do it again. So if you have interest in learning more about shoulder innovations, please don't hesitate to grab Dave and I you know through the rest of this conference. So thank you very much