Good morning, and welcome to the first quarter 2022 earnings conference call for ConforMIS. My name is Michelle, and I'll be your conference operator today. All lines have been placed on mute to prevent any background noise. After management's remarks, there'll be a question and answer session. I would like to remind you that this call will include forward-looking statements within the meanings of the federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements made during this call that are not statements of historical fact could be considered forward-looking. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements, including those discussed in the Risk Factors section of ConforMIS' public filings with the U.S. Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements. ConforMIS disclaims any obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call will include time-sensitive information and is accurate only as of the last broadcast today, May 4th, 2022. I will now turn the call over to Mark Augusti, President and Chief Executive Officer of ConforMIS. Thank you, and welcome everyone to our first quarter earnings call. With me today is our CFO, Bob Howe. We had a quarter of steady progress with our Identity Imprint knee system, our new Platinum Services Program, and the products in our development pipeline. These will be the cornerstones of our product and service offerings going forward and we believe will be the catalyst for our growth. We achieved several Imprint milestones during the quarter. We successfully completed our 250th Imprint procedure and now have over 500 orders in the queue. The clinical feedback remains compelling, and we continue to see a positive response from the ASC market, which is the primary target for this product. Importantly, Imprint is already on contract at nearly 70% of our existing accounts at an average price that is roughly the same as iTotal Identity. This positions us well to drive gross margins as orders and procedures ramp. We remain on pace to transition to the full market release in June, at which time we anticipate that we will have Imprint on contract with well over 90% of our customers. To support the full launch, we have a series of training and medical education events planned to drive further awareness and expand surgeon access. The market has reacted very favorably to this new implant knee offering, and we expect this to continue as we target the ASC setting. Our new Platinum Services Program is also progressing well. This program allows facilities to offer a fully personalized knee system as a deluxe upgrade option for their patients. Since its launch on January 6th, interest has been strong from ASCs and hospitals. We're educating all stakeholders about the numerous benefits of the program and the potential to generate additional facility revenue. We developed Imprint and launched our Platinum Services Program to address the ASC opportunity while simultaneously providing a premium choice to patients as they consult with surgeons regarding their knee replacement options. We believe that a leading indicator of our success is our ability to gauge the appeal to a broad spectrum of facilities. We are committed to providing additional metrics to help you monitor our progress of our new program through 2022. To date, we have enrolled 18 healthcare facilities in the Platinum Services Program, and the pipeline remains robust, including many competitive accounts. We expect the growth of contracted Platinum Services facilities to be lumpy since contracting with new customers is a very variable experience depending on the size of the customer and the number of stakeholders in the decision-making process. That being said, our team is energized with the new business opportunities that Platinum Services is creating with current and competitive accounts, and we expect to grow the number of enrolled healthcare facilities we do business with over the coming quarters. Another favorable achievement to report in the past quarter is the way we are extending our brand presence through a strategic partnership with Synchrony Financial, a leading consumer finance company. Synchrony has added our Platinum Services program to their successful CareCredit offering, which is accepted at more than 250,000 provider and healthcare-focused retail locations and has more than 11 million cardholder accounts. We believe this will provide healthcare facilities and patients an easy-to-use and readily available financing option to offer patients for out-of-pocket costs related to the personalization service upgrade. We've already noted that the Platinum upgrade is eligible for any health savings or flexible spending accounts, and now with CareCredit, we're making sure patients have increased access and choice in their healthcare journey. Turning to the macro environment. Elective procedures are still below pre-pandemic levels, and staffing shortages continue to persist across the healthcare system. On the positive side, Omicron seems to have run its course after peaking in January. As we look to the future, we do not expect an immediate snapback in procedure levels, but we also do not anticipate any further major COVID-related shutdowns. What we do expect is a methodical procedure ramp as clinic visits pick up and hospitals and ASCs normalize operations and staffing levels. COVID-related issues, combined with our business model transition, have put our product gross margins under pressure over the past few quarters with a pulling impact in Q1. The main driver for this is we are operating our manufacturing plant at suboptimal levels due to challenges caused by higher-than-normal turnover and absenteeism. Constantly changing staffing and shift rotations have negatively impacted our manufacturing efficiency and has triggered higher levels of scrap and longer manufacturing times. Recently, we've made strides at improving staffing levels, and I'm pleased to report that we're currently at about 9% of our target levels. It's important for me to point out that we believe these challenges peaked in Q1, and our gross margin will show sequential improvement throughout the year. We forecast that we will be back at our gross margin levels of low 40s% by year-end. I'm confident in our ability to do this, especially given that this is a significant area of focus for the newest member of our executive team, Mike Fillion, who started with us on April first as our COO. This is a new position for us, but one we had planned to add for a while. I'm extremely excited we were able to attract someone as talented and seasoned as Mike to our company. He has 30 years of experience in manufacturing operations and is well-versed in applying lean principles to make plants run more efficiently. Now I'd like to give you an update on important products in development. Our pipeline projects remain on track as follows. Our Terra primary hip stem continues to be on schedule for mid-2022 limited market release. The Terra stem will be a shorter, proximal filling type design conducive to the popular direct anterior approach. We believe having a broader hip portfolio will help us to continue to grow our hip franchise. We also remain on track for a fourth quarter limited market release of our porous coated knee offering. The uncemented option will be first available with our Imprint knee system, and then we evaluate expanding the technology to a fully personalized platform. Let me now turn the call over to Bob for a more detailed financial review of the quarter. Thank you, Mark, and good morning, everyone. I'll start with a walkthrough of our financial highlights and then close with a few thoughts on our outlook. Product revenue is our most important financial metric, and we had a nice start to the year. We generated $14.9 million of product revenue, which was 8.6% growth over our first quarter last year. This was better than our expectations, primarily due to fewer Q1 scheduled surgeries pushing out to future quarters. The growth over prior year was due to a modest increase in elective surgeries and growth in our ASC channel. Within product revenue, sales of our ConforMIS hip system were approximately $800,000, up 18% compared to last year's first quarter. Our hip growth rates are expected to accelerate later in the second half of the year as we expand our product portfolio with a limited market release of our Terra hip stem and trialing by surgeons resumes in earnest. I would now like to spend time on our product gross margin. As good as we felt about our product revenue results, we had a similar level of disappointment in our product gross margin for the first quarter, which was 34.1%. Although we indicated on our last call that this metric would be under pressure and should be in the high thirties during the quarter, our plant continued to operate inefficiently. We experienced higher manufacturing scrap, and we continued to face macro headwinds, including inflationary pressure, higher input costs, supply chain constraints, and labor shortages. Additionally, our cancel case inventory expense was higher than forecasted, as this remained elevated during the quarter. Unscheduled surgeries can still occur, and we continue to work with healthcare facilities to establish procedure dates for these cases. We are focused on improving these issues impacting our product gross margin, although we expect the macro headwinds will remain an overhang. As Mark mentioned, we are now running about 90% of capacity from a workforce perspective, so we have bridged the gap on personnel. Now we are working hard to get our workforce operating as a cohesive unit. By doing so, we will improve labor efficiencies, lower scrap, improve delivery performance, and accelerate our inventory builds to support our Imprint full commercial launch. I'm excited Michael Fillion has joined the ConforMIS team, and I'm looking forward to working with him to get these metrics back in line over the next few quarters. For now, our forecasts show product gross margin sequentially improving in Q2 to the mid- to upper-30s% and low-40s% in the second half of the year. This is a short-term issue that we believe will correct quickly. Longer term, we believe that as we ramp Imprint and the Platinum Services Program, we have a meaningful opportunity to further expand our gross margins. I will now move to OpEx. Our total operating expenses for the first quarter were $20.5 million. This was about $5.2 million higher than the same period last year and related to a few items. We had $1.6 million of higher costs in sales and marketing, which was partly due to the timing of the AAOS trade show, which occurred in the third quarter last year. Additionally, we had higher commission and employee-related expenses as we continue to invest in our commercial team to support our growth strategy. Our R&D expense increased by $900,000, primarily related to employee and project-related costs required to support our product pipeline. Lastly, we had $2.7 million of higher G&A expenses driven by professional fees related to IP litigation and higher delivery expense as we again relied heavily on expedited shipping methods because of our manufacturing capacity challenges. Our OpEx expectations for the year remain unchanged despite Q1 being a little higher than expected. Accordingly, we continue to expect operating expenses to be between $75 million and $81 million for the year. However, the timing and the buckets may change slightly as we manage to this number. Moving to our balance sheet, it remains strong with cash and cash equivalents of $82.7 million at the end of the first quarter. As highlighted last quarter, we are building our inventory balance on Imprint knees. We expect this build to continue, and we also add the initial inventory production for the Terra hip over the coming quarters to support our product launch cadence. Net cash flow in the first quarter was $17.8 million use, which was higher than in recent quarters. The increase was driven by lower margins, higher operating expenses, timing of one-time annual payments, and changes in working capital. We anticipate quarterly net cash use to improve throughout the year as revenue growth rates improve and product margins improve as well. I will close with our outlook for the second quarter. We expect our second quarter product revenue to be between $14.5 million-$15.5 million. We confirm our full-year product revenue expectations of $60 million-$70 million. A couple of things to note on this range. First, sequentially from Q1 2022, it is important to keep in mind that in five of the past six years, our second quarter product revenue has been lower than the first quarter due to general seasonality trends. Second, I want to remind you that last year's second quarter had significant rescheduled activity from Q1 delayed surgeries during a period of heightened procedure recovery. While our entire business was impacted by this in Q2 last year, our hip business had an even more pronounced level of rescheduled case activity that resulted in a relatively high Q2, making for a difficult comp from a year-over-year perspective. Taking all this into consideration, like we did last quarter, we've taken a conservative approach to our outlook. Our Q2 guidance does not assume significant improvement in either elective procedures or staffing shortages in medical facilities. We do not expect noticeable recovery in elective procedures until the second half of 2022. With that, Mark and I are happy to take your questions. If you would like to ask a question, please press star then one. If your question has been answered and you'd like to remove yourself from the queue, press the pound key. Our first question comes from Steven Lichtman with Oppenheimer & Co. Inc. Your line is open. Thank you. Good morning, guys. I guess first I was wondering if you could talk a little bit about the intra-quarter dynamics and what you saw? I mean, obviously assuming that January was the toughest, but from what you saw exiting the quarter and any commentary you can make in terms of how that trend perhaps may have continued into April? Yeah. You're talking specifically just sort of macro demand, sort of elective procedure, that type of thing, or? That's correct. Yeah. Definitely, Steven, appreciate the question. As Omicron faded away, we saw less impact among facilities, you know, our healthcare customer, facility customers, and we saw, you know, some increased demand pick up through the quarter. You know, April sort of, as I think I pointed out in my comments, Q2's always been a bit down, so April sort of leveled off. You know, that's why I think what we're saying. I'm not saying that's 'cause of anything COVID related. I just think procedures sort of are gonna have a slow rise. You know, for us, we saw slight improvement, you know, as far as the market, but we're still in that transition phase. That's why, you know, we sort of have given the range for Q2 that we've given as far as how April was. Okay, got it. In terms of Imprint, sounds like feedback continues to be good. What are sort of the last pieces in your mind, you know, to get you guys ready for the full launch? Is there any additional feedback required, or is it really just building out the inventory? You know, what are these final steps as you move toward, you know, the full launch? Yeah. It's really the commercial team's done a really good job on getting Imprint on contract. As you know, in med tech these days, you know, access is a big thing. We're very happy with the clinical performance, so there's nothing we have to do there. It's really all operationally getting ready. There's a couple components to that. As you mentioned, inventory is the biggest one, and that has been a challenge for us given what we dealt with heading to year-end last year, and then obviously as we just noted in Q1. We're getting there. We're making, you know, the right strides, but we're not quite ready. When we say ready, part of our commitment is we wanna be able to deliver Imprint in a 3-4 week timeframe, you know, significantly faster than, you know, the six-week timeframe that we do with our custom, 5-6 weeks with custom, depending on the product. That requires two things. That requires having the inventory, as I just talked about. It also requires having our enterprise management system, our software, all the commercial interactions, really robust and sort out. There's some things we've had to do through, you know, warehouse software management systems and stuff like that that we haven't had to deal with, frankly, in the past when we're build to order. Those are just some processes that we're making sure are robust and reproducible so that we can, you know, as I said, flow orders through and deliver reliably in a 3-4-week timeframe on Imprint. We're on track for June. I will tell you that, you know, we were internally hoping we would be able to be ahead of this, heading into 2022, but a lot of the macro events conspired to make that more of a challenge. We've always said outwardly that it would be a 2Q launch, and you know, as we sit today, we still feel comfortable that we'll be able to do that. Okay. Got it. Lastly for me, Bob, in terms of the gross margin, you know, you laid out the specifics on 2022, which was really helpful. As we think about, you know, over the next couple of years, you know, so can you remind us, you know, what are some of the? Drivers to gross margin expansion in your mind, you know, as you know, as we look beyond this year and as you start working with Mike. Yeah, I mean, the biggies are obviously Imprint and Platinum Services will have a big contribution there as we grow that to be a larger portion. That's gonna have a huge benefit for us. I would say that's probably the single largest element from a product standpoint. Then I would also say, obviously, you know, volume in general is gonna help us, right? We can leverage the fixed overhead that we have in place. And that in combination with those two items, Platinum Services and Imprint, will be probably the biggest driver. You know, clearly we're ramping now, but you know, in certainly in 2023, I would expect to see even more significant improvements as that becomes a bigger piece. Absolutely. Yeah. Got it. Thank you, guys. Thanks, Steve. Thanks, Steven. Our next question comes from Josh Jennings with Cowen. Your line is open. Hi, good morning, gentlemen. Thanks for taking the questions and for the thorough download this morning. I wanted to just ask on the Imprint launch and just follow up on Steven's question on moving into full launch mode? How is your kind of surgeon customer base reacted to kind of the mandate to move away from customs outside of Platinum Service and kind of move fully to Imprint? Has there been any pushback? It seems like the transition is going very smoothly, but just wanted to check in on that element of the Imprint launch. Well, no, Josh, this is Mark. It's a great question, and it's an important consideration. Anytime you do a change to your business model, you know, it can be upsetting to customers, and it's a challenge to change your culture around from that standpoint. I would say that so we're talking about ConforMIS current customers, right? People that work with us every day and know us well. Those people all see the opportunity almost to an individual, and understand the pressures in the market and think it makes, you know, keen strategic sense to do it. They understand it. Having said that, there's probably a few, you know, less than 10%, that, you know, if they want they just voice that they're gonna miss being able to give a true, fully custom for, you know, implant, you know, at no charge, right? To their patients. Now, you know, they'll have to move to our new model, which is you can get, you know, Imprint, which is sort of like, call it 75% of what we have with Identity. If they wanna go the rest of the way, then it's a, you know, it's a patient pay upcharge or a cash upcharge. You know, those guys are not thrilled, but, you know, the flip side is they still wanna work with us, right? They still understand it. Many other people are fine. They support us in getting access to the hospital. I'd say, frankly, some of them, we haven't turned them on because we're in limited release, so some of them haven't had access because they're not turned on, and so they're chomping at the bit to get it, so to speak, and wanna get it. What we found is when they start using it, they're actually really happy. They're actually really happy because, you know, our modeling suggests that frankly, in only 25% of the patients should they even really see the sizing and the shape difference because of the way we've designed Imprint. So you know, that's bearing out as we turn customers over to see Imprint. There's the group, like a third or so that are really excited about Platinum Services. They see the opportunity to offer a premium product. They see the opportunity to increase their service offerings to their customers, and they're really on board with us because they, you know, they're looking for, you know, something to have a change in this industry trend to race to the bottom. You know, they wanna have an outlet where they can give their Medicare patients choice, they can give their commercial patients choice, and it's not always just about a race to the bottom on price. This to me is exciting from that standpoint. That's, you know, that's gonna be the key discussion we have over the next few quarters is what kind of uptake we get with Platinum Services. Now, this is a long-winded response, but I wanna extend it out to other things. This is really to your question about our own customers, right? 'Cause it's a change for them. Remember, we're only a couple of points of market share. The vast majority of customers are not ConforMIS customers, and they really like Imprint. You know, we're about, I'd say, about a third of our limited market volume is competitive. We think we're gonna be able to do that well when we go to full market release. For them, you know, it's all upside. They get an automatically sized implant, they get an in a box at a price they want. It's great for their ASC. We're seeing a really good uptake, you know, in the ASC and limited market release. You know, I'll take that positive story any day, and the ability to go have new discussions, which was always the point we talked about, Josh. We'll manage sort of the attitudes of our existing ConforMIS customers because I really like the way the new customers are responding. No, understood. I just got a couple of things through. Just on pricing strategy for Imprint, I mean, our understanding was it's gonna be relative parity to other off-the-shelf implants from competitors, but just wanted to check in there on any changes to the pricing strategy as you're moving into the full launch for Imprint. No, no change. I mean, you know, we think we've got a better implant, right? We also have a great cost-saving story with our implant in a box. You know, that's great for us. We're just now able to be more flexible, and be able to meet, you know, price volume opportunities that frankly we just couldn't meet, Josh, with our fully custom implant. 'Cause, you know, simple fact is, when you make a standard implant that's, you know, 'off the shelf' and has only a standard number of sizes, you have lower cost of goods, because everything's standard and it's all inventory, you're not throwing anything away, all that other stuff. That gives us good pricing flexibility and that's what's gonna get us. You know, both these products, whether, you know, whether the customer buys an Imprint from us, it's gonna be margin accretive, or if we end up doing the Platinum Services, then due to that scenario, the way the funds flow, that's margin accretive too. So this is a smart play for us. But it's also a smart play for the market and our ability to address the market, 'cause now we're offering something that has value to, as we said, to these customers that are high-volume customers who can never play, that want lower price, and now they wanna get into the ASC. So that's number one. Then number two, now the opportunity to actually have a revenue generating opportunity which never existed before in getting into, you know, a deluxe service business is a great discussion that we're having with people. We reported out 18 facilities. You know, take that for what it was. It was zero forever. It's disruptive. Nobody's doing it. It's early days. We expect that number to grow, and we'll talk more about that over the coming quarters. Great. Just a quick follow-up on Platinum Services. This 18 kinda was great to see you're seeing really early interest in demand. Those 18 facilities are they mostly historic ConforMIS customers or the mix of new and old? Mix. Great. Lastly, just any update on the Stryker agreement for PSI and that partnership? Appreciate you taking all the questions. Sorry. Load them with them. Yeah. No, thanks for asking. Stryker is still, you know, still have the agreement, remain, you know, good partnership, good dialogue. You know, as we said, we can't really comment on where it's at. I think it's still not, as far as I understand, fully and completely launched, or maybe that's an assumption, or maybe it's quote like fully available, but I still think they have a lot of training to do. There's still uptake. You know, I can't speak to that. From what I can tell, the product works. It's there. It's just like anything else, trying to get incremental dollars in this inflationary environment and trying to deal with you know the cost pressures that hospitals have. You know, that's a tough road. You know, it is what it is. Look, it's all good. We're delivering, and they're able to order and you know, we feel good about the partnership. Thanks a lot, Mark. Thanks, Josh. This concludes the question and answer session. I'll turn the call back over to Mark Augusti for any closing remarks. Thank you, operator. Well, once again, everybody, thanks for joining us here this morning. We haven't typically done the call in the morning. We'll evaluate if we wanna continue with that going forward, if we'll move back to the afternoons. A lot of it'll be based on what our analysts tell us, what works for them. But thanks to the team for helping put this together. We've got our annual meeting here later this afternoon. I wanna thank everybody for their interest in investment in ConforMIS. We really do have a unique and compelling strategy that is bringing choice back to patients. We understand what we're doing is difficult, and it's disruptive because it's never been done before in orthopedics. If you actually take the time to look around, it's been done in a lot of other subspecialties. We're excited to bring this forward to orthopedics. You know, we look forward to giving an update on how it's progressing at our next call in August. Thank you, everybody, and have a great rest of your day. Take care. This concludes the program. You may now disconnect.