Good morning, and welcome to OrthoPediatrics Corp. Q2 2022 Earnings Conference Call. At this time, all participants are in listen-only mode. We'll be facilitating a question-and-answer session towards 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 Matt Picciano from the Gilmartin Group for a few introductory comments. Thank you for joining today's call. With me from the company are David Bailey, President and Chief Executive Officer, and Fred Hite, Chief Operating and Financial Officer. Before we begin today, let me remind you that the company's remarks include forward-looking statements within the meaning of federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to numerous risks and uncertainties, and the company's actual results may differ materially. For a discussion of risk factors, including, among others, the risks related to COVID-19, the impact this pandemic may have on the demand of the company's products and the company's ability to respond to the related challenges, I encourage you to review the company's most recent annual report on Form 10-K, which was filed with Securities and Exchange Commission on March 3rd, 2022. During the call today, management will also discuss certain non-GAAP financial measures, which are supplemental measures of performance. The company believes these measures provide useful information for investors in evaluating its operations period over period. For each non-GAAP financial measure referenced on this call, the company has included a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures in its earnings release. Please note that the non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for OrthoPediatrics' financial results prepared in accordance with GAAP. In addition, the content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast today, August 4, 2022. Except as required by law, the company undertakes no obligation to revise or update any statements to reflect events or circumstances taking place after the date of this call. With that, I would like to turn the call over to David Bailey, President and Chief Executive Officer. Thanks, Matt. Good morning, everyone, and thank you for joining us. We hope you are safe and well. As we start all earnings calls, I'd like to highlight that we helped over 23,000 children in Q2 of 2022. Since inception, OrthoPediatrics has now helped more than 560,000 children in total when including the accomplishments of MD Orthopaedics, which I will provide more detail on shortly. Doing the right thing for children is and always will remain our top priority. In Q2 of 2022, we generated total revenue of $32.9 million, representing growth of 23% compared to Q2 of 2021. MD Orthopaedics generated global revenue of approximately $2.6 million, where we realized immediate favorable sales synergies post-acquisition. Excluding MD Orthopaedics, Q2 organic revenue growth was approximately 14% compared to the prior year period. As a reminder, Q2 of 2021 benefited from the rescheduling of canceled COVID cases, whereas Q2 2022 patient volumes were negatively impacted by lingering COVID headwinds early in the quarter. When analyzing intra-quarter trends, the business started off slowly with continued procedure cancellations due to lingering COVID headwinds and hospital staffing shortages. As we progressed through the quarter, the operating environment began to normalize, leading to accelerated elective procedure volumes in June, which has continued into Q3. Additionally, following a prolonged period of COVID disruptions, growth in the quarter was aided by a strong international recovery. In Q2 of 2022, we generated record adjusted EBITDA of $2.1 million. Our management team has for some years consistently improved profitability, and we have taken seriously our role as financial stewards to prudently invest in sustainable growth initiatives. We are extremely proud to reach this important milestone as we believe it is a leading indicator of future and sustainable profitability. Before going into more detail on each revenue segment, I wanna speak to some of the macro trends experienced in Q2. First being COVID, and more specifically, the backlog recovery. Entering April, we continued to experience COVID cancellations, albeit at lower levels compared to Q1. That said, as COVID infection rates started to decline in March, the recovery of deferred cases into Q2 was lower than expected. Furthermore, the recovery in the eastern region of the United States, which is our largest sales region, was more muted compared to other regions of the country. We continue to view this as a temporary phenomenon, given that untreated deformities simply become more severe as they progress. With elective procedure volumes accelerating in June and July, we have increased confidence that the operating environment is normalizing and that the estimated $2.5 million backlog of U.S. deferred cases will be rescheduled over the balance of 2022. Second is the disruption associated with the global supply chain and increasing inflationary risks. We continued to experience modest supply disruption on select specialty instruments in the form of extended lead times. We anticipate that any supply chain disruptions will continue to be limited and may delay set deployments by only several weeks. In fact, minor delays in June caused approximately $2 million of deployed sets to fall into early July. We also believe this to be temporary and expect minimal delays throughout Q3. Concerning inflation, we are not seeing meaningful price increases from our suppliers of surgical implants or instruments, and thus do not expect gross margins to be impacted in 2022. Moving on to our revenue segments. In Q2 of 2022, we generated total Trauma and Deformity revenue of $22.6 million, representing growth of 26% compared to the prior year period. MD Orthopaedics, which will be reported as Trauma and Deformity revenue going forward, generated revenue of approximately $2.6 million in Q2 of 2022. Excluding MD Orthopaedics, Q2 organic Trauma and Deformity revenue growth was approximately 11% compared to the prior year period. As mentioned previously, the quarter started off slowly but accelerated meaningfully in June as the operating environment normalized. Segment quarterly growth was partially offset by a slower recovery in elective deformity cases in April and May. As mentioned previously, elective procedure volumes accelerated in June. Our nonelective trauma business delivered strong growth, led by the continued high rate of surgeon adoption of our PNP|FEMUR system, new Cannulated Screws, and Skiffy system. Additionally, we saw substantial growth in PedFoot and our biologics business. In Q2 of 2022, we generated total Scoliosis revenue of $9.4 million, representing growth of 23% compared to the prior year period. Following a challenging start to the quarter where we experienced residual COVID headwinds, U.S. elective procedure volumes improved considerably in the month of June. Despite these early headwinds, we added several new RESPONSE users and deployed multiple demo units of 7D in Q2, which I will touch on later in my prepared remarks. Consistent with overall elective procedure volumes, ApiFix also had a challenging April and May but saw significant improvement in June. Given the acceleration in elective procedure volumes in June and July, the combination of additional RESPONSE and ApiFix users and pending 7D demo conversions, we have a better line of sight in the back half of 2022 to deliver strong scoliosis revenue growth. I'll now provide an update on a few of our key strategic initiatives, starting with the acquisition of Pega Medical. Pega Medical was founded in 1994 as a bioengineering services company striving to improve the treatment of orthopedic conditions. Over the years, Pega transitioned to focus on pediatric orthopedics, specifically within the Trauma and Deformity patient population. Their product offerings include novel technologies to treat some of the most unique conditions in pediatric orthopedics. Pega's innovation led to the development of the Fassier-Duval Telescopic Intramedullary System or the FD Nail for short. The FD Nail is a cutting edge implant designed to treat bone deformities in children with osteogenesis imperfecta without disrupting their normal growth. This has become the most recognized orthopedic treatment for osteogenesis imperfecta around the world since its launch in 2000. Furthermore, Pega has 25 years of experience collaborating with OEMs, universities and surgeons from different parts of the world in the development, evaluation, and regulatory approval of innovative devices for pediatric patients. It sells its products in over 70 countries around the world. Pega's product portfolio increases OP's total systems from 39, which includes MD Orthopaedics to 46, and increases the percentage of total trauma and deformity cases OP can treat from 85% to approximately 90%. Given Pega's history of innovation and current product development pipeline, we believe when combined with OP's robust R&D infrastructure, the capacity for future product launches is significant. On the commercial side, similar to previous acquisitions, we plan to use our strong agency sales infrastructure to further penetrate the market, particularly here in the United States. Now turning to the integration of MD Orthopaedics or MDO. As a reminder, in April, we acquired MDO, a specialty bracing company for the treatment of clubfoot. In our first full quarter together, MDO generated revenues of approximately $2.6 million. It's important to note that MDO has its own established distribution channel, which has allowed for faster than anticipated integration. As such, we've seen a halo effect developing within the commercial channel. Most notably during Q2, MDO received multiple large stocking orders sold to new European distribution partners, which resulted in better than expected revenue in the quarter. Given these initial orders, we now expect Q3 and Q4 revenue to be approximately $1.7 million per quarter. While still early in the MDO's integration, we have been encouraged by the promising global revenue synergy opportunities and the positive feedback from surgeon customers. Additionally, we are actively establishing a rapid cadence of new product development over a multi-year period to penetrate the estimated $600 million nonsurgical market. With approximately 80% of pediatric orthopedic care involving nonsurgical treatment, we view this as a significant growth and profit driver of the business long term. Both MDO and Pega are companies that we have walked alongside for many years, and we know their stories well. We have long wanted to acquire these assets because they enhance our competitive position and build on the OP story. From a financial perspective, both companies are cash flow positive today and do not require meaningful incremental operating expenses from OrthoPediatrics to drive revenue growth. As far as our M&A pipeline is concerned, right now we do not see any assets of scale in pediatric orthopedics that are of strategic or financial interest. Our focus now is to integrate MDO and Pega while also driving organic sales growth. Turning to new product development. In June, we launched Drive Rail, our new external fixation system, which received FDA clearance in April. Drive Rail is a unilateral external fixation system with components designed to manage lower extremity fractures and corrective procedures. Unique to DRIVE Rail, this system contains integrated and customizable features that simplify the number of parts and steps needed to perform these complex surgical cases. In addition, the DRIVE Rail system can be utilized with the OrthoSystem, serving multiple indications at the same time. DRIVE Rail is a welcome addition and complements our entire external fixation portfolio. In Q2, we sold multiple sets to international distributors and are planning consignment placements in the US, Canada, Australia, and the EU. In addition to the exciting new products we are working on with MDO and Pega, we're on track to launch a number of RESPONSE instrument set upgrades and a new RESPONSE cannulated screw line extension in the back half of 2022. Regarding our biologics product portfolio, in Q1, we signed an agreement with BONESUPPORT to exclusively distribute the CERAMENT Bone Void Filler product within the U.S. Since the agreement was signed, we are encouraged by the initial product adoption and overall growth, having added several new hospital accounts in Q2. Transitioning to strategic partnerships. In July, we placed our first 7D Surgical intraoperative navigation system at St. Mary's Hospital in West Palm Beach, Florida. As we exit July, we currently have several evaluation units working their way through value analysis committees. More importantly, these units have been placed in hospitals where we currently have low account penetration. That said, each demo unit is being used alongside the RESPONSE system, and we are starting to see strong pull-through. As we look into the back half of 2022, we have a high degree of confidence that these demo units will be converted to sales. We continue to view 7D as a transformative platform that will improve patient outcomes, drive increased surgeon engagement, and allow us to leverage our entire product portfolio to pull through sales of our other products. Also in mid-July, we announced an exclusive distribution agreement with 3D-Side, a Belgian software developer and manufacturer of patient-specific 3D printed cutting guides to assist surgeons performing corrective and bone tumor resection osteotomies. 3D-Side's technology complements our pediatric limb deformity implant and biologic offering and increases exposure in the pediatric orthopedic oncology market, where many of the most challenging orthopedic cases involving tumor resection require a full complement of solutions, including implants, biologics, and patient-specific devices. We are excited to enter this relationship with 3D-Side to provide our pediatric orthopedic customers access to the 3D-CUT products. Lastly, we are particularly proud of our execution in helping train the next generation of pediatric orthopedic surgeons. Year to date, through June thirtieth, we carried out more than 100 training events for healthcare professionals. In Q2 alone, we trained over 200 surgeons on Ortho. We held OP educational events in Chicago and Phoenix, showcasing ApiFix, and performing several 7D surgical navigation demos. We were once again a Double Diamond sponsor at POSNA in Vancouver and hosted a networking event for Women in Pediatric Orthopedics, which was extremely well attended. Our commitment to non-commercial clinical education keeps us true to our cause and signals our dedication to advancing the entire field of pediatric orthopedics. To close, elective procedure volume trends improved sequentially into July, and we have enhanced visibility into the remainder of Q3 as the operating environment normalizes and backlog cases are being rescheduled. Therefore, we have a high degree of confidence in our ability to generate 20% or greater organic revenue growth in 2022. While it's early to start thinking about 2023, the company has never been in a better strategic position, especially following the acquisitions of MDO and PEGA. In addition to both assets opening up new and exciting growth opportunities, they will also be significant drivers of future profit, given their attractive gross margin profile and limited operating expense requirements. In summary, we believe the underlying fundamentals of our business were enhanced in Q2, and that we continue to make investments that create greater distance from competitors and ensure our long-term success as the market leader in pediatric orthopedics. With that, I'll turn the call over to Fred to provide more detail on our financial results. Fred? Thanks, Dave. Our Q2 2022 worldwide revenue of $32.9 million increased 23% when compared to Q2 of 2021. Growth in the quarter was driven primarily by continued trauma growth, combined with non-elective procedures increasing throughout the Q2, resulting in 14% organic growth. In addition, we added $2.6 million of revenue from MD Orthopaedics, which was boosted by multiple EU stocking distributor shipments. In Q2 of 2022, U.S. revenue was $25 million, a 15% increase from Q2 of 2021. The growth in the quarter was primarily driven by organic growth across scoliosis and trauma & deformity correction, as well as the addition of MD Orthopaedics, which added $1.3 million of incremental revenue. In Q2 of 2022, we generated total international revenue of $8 million, representing growth of 61% compared to the prior year period. Growth in the quarter was driven primarily by increased procedure volumes as well as increased set sales to our international stocking distributors in scoliosis and trauma and deformity correction. MD Orthopaedics added $1.3 million of incremental revenue. In Q2, trauma and deformity revenues of $22.6 million increased 26% compared to the prior year period. Growth was driven primarily by organic growth from cannulated screws, PediFoot, and PNP|FEMUR systems, as well as non-organic growth from the MD Orthopaedics of $2.6 million. In Q2 of 2022, scoliosis revenue of $9.4 million increased 23% compared to the prior year period. Growth was primarily driven by increased sales of our RESPONSE, FIREFLY, and BandLoc products, as well as increased set sales to our international stocking distributors as they look to respond to increased backlog. Finally, Sports Medicine other revenue in Q2 of 2022 was $939 thousand, which declined 15% compared to the prior year period. Turning to set deployment, $3.4 million of sets were consigned in Q2 of 2022 compared to $4.0 million in Q2 of 2021. Slight delays on a few items delayed some deployment, and we launched another $2 million of sets in July and expect a continued rollout throughout the rest of 2022. Touching briefly on a few key metrics for Q2 of 2022. Gross profit margin was 75.9% compared to 76.6% in Q2 of 2021. The change in gross margin is primarily driven by increased set sales to our international stocking distributors at zero margin. However, this should drive higher replenishment sales in the future. Total operating expense increased $5.4 million or 23% from $23.3 million in Q2 of 2021 to $28.7 million in Q2 of 2022. Sales and marketing expenses increased $1.6 million or 14% to $12.4 million Q2 of 2022. The increase was driven primarily by increased sales commission expenses. General and administrative expenses increased $3.5 million or 31% to $14.5 million in Q2 of 2022. The increase was driven primarily by the addition of personnel and resources to support the continued expansion of our business, as well as increased legal expenses associated with our recent acquisitions. Interest and other income were $3 million in Q2 of 2022 compared to $1.2 million of expense in the prior year period. In Q2 of 2022, we realized a $5 million fair value adjustment benefit, which was driven by the valuation inputs that were lower in comparison to the same period last year, compared to roughly a $1 million charge in Q2 of 2021. We reported an adjusted EBITDA profit of $2.1 million in Q2 of 2022, compared to a profit of $1.2 million for Q2 of 2021. For the first half of 2022, we generated $0.5 million of positive adjusted EBITDA, compared to a loss of $0.1 million in the first half of 2021. We ended Q2 with $52.5 million in cash and restricted cash, and we continue to have $19 million available on our line of credit. $31 million was drawn on our $50 million line of credit in advance of the July 1, 2022 cash payment for Pega Medical. Finally, turning to our outlook for 2022. Our business will continue to benefit from several fundamental tailwinds, including an increased active surgeon base, growing backlog of deferred procedures, an expanded product portfolio, the addition of key strategic partnerships, and pending international approvals. Our 2022 outlook is highly sensitive to assumptions on a steady global recovery, which anticipates case scheduling and elective procedure levels normalizing throughout the year. For 2022, we now expect annual revenue to be between $127 million-$130 million, representing year-over-year annual growth between 30%-33%. This guidance assumes roughly $6 million of revenue contribution from MD Orthopaedics and $3 million from Pega Medical. We continue to expect organic revenue of 20%-23% growth. Lastly, we plan to deploy between $24 million and $26 million of new sets in 2022, representing year-over-year annual growth between 80% and 90%. This increase is driven by pent-up demand for new product introduction systems, legacy systems, as well as consignment of 7D intraoperative navigation systems. In addition, we continue to fully expect to generate $several million of adjusted EBITDA for the full year of 2022, crossing this major milestone for our business. At this point, I will turn the call back to Dave for closing comments. Thank you, Fred. I think there are three takeaways from our Q2 performance. First, elective procedure volumes improved in June, and that trend has continued into July, giving us confidence that we will generate 20% or greater organic revenue growth and 30% or greater total revenue growth in 2022. Second, the company's strategic position has been substantially enhanced by the acquisition of MDO and Pega, two companies we have known and admired for some time. Third, it is clear that the competitive strength of our business has never been greater, and the future is bright. With that, I'd like to turn the call back over to the operator to open the line for any questions. As a reminder, to ask a question, please press star one. Our first question comes from Matthew O'Brien with Piper Sandler. Your line is open. Hey, good morning. This is Phil on for Matt. Can you hear me all right? Yeah. Good morning, Phil. Yeah. Hey, Phil. Great. Great. Thanks for taking the questions and congrats on the quarter. Let's just start off with MD Orthopaedics. You know, $2.6 million in the quarter, which is great to see. How should we think about these, you know, EU stocking orders versus a more normalized run rate? You know, just a quick follow-up with guidance. You took it up about $2 million, you know, mostly attributed to that MD Orthopaedics number. Am I thinking about this the right way? You know, and if so, where was the remaining delta between, you know, the $2 million and then what was attributable to MD Orthopaedics? Thank you. Yeah, absolutely. So first of all, yes, you are correct. MD Orthopaedics did $2.6 million in Q2. We think that is gonna do more like $1.7 million in Q3 and $1.7 million in Q4, so in that range. That delta is really driven by these one-time stocking orders in the EU that was very strong in Q2. The increase in revenue, you are correct that most of it does come from the acquisitions. We continue to see our core business executing as we had planned earlier in the year. The organic revenue growth of 20%-23% is exactly the same as what we had predicted before. The increase is coming from the incremental benefits we're seeing from the acquisitions, with the synergies coming into the OrthoPediatrics family. Great. Thanks for the color. I guess just, you know, with MD Orthopaedics exceeding expectations, you know, initially here, are there any additional specific areas you're targeting in, you know, this nonsurgical space? You know, I appreciate what you've said on how big the opportunity is there and, you know, what's your commentary and the commentary today on M&A. Yeah, I think our goal here is to integrate MDO, as you might imagine. The focus has been to integrate that business really before we think about what the next stage in our nonsurgical business is. That said, MDO has about six new products that are in the development pipeline, at least one of which may get to the field globally here before end of year. There's a number of areas still in clubfoot treatment where we can expand, and that will be our first step really is to continue to expand in this lower extremity nonsurgical bracing market. And we think that with those six products and the synergies we're seeing, MD Orthopaedics will be able to really accelerate growth as we look over the next you know 12-18 months. From an M&A perspective, you know, our commentary in the script here has really been that we've got a lot of work to do to integrate MDO and Pega. MDO has gone really well so far. We're obviously ahead of that. With Pega, we're just getting started. We don't see anything very substantial in the marketplace at this point that really interests us. We've got work ahead of us over the next, you know, 12-18 months in integration. Great. Thanks for taking the question. Thanks, Phil. Our next question comes from Rick Wise with Stifel. Your line is open. Good morning, Fred and David. Anton on for Rick. Thanks for taking the question. Hi, Anton First one on international. Your commentary on increased international purchasing sounded fairly positive and would seem to set the stage for continued growth given the international backlog. I just want to be clear, have you returned to kind of more normalized levels now? And how would you characterize that aspect of your business to growth? Is it a headwind or accelerator as we look to the rest of the year? Yeah, I think it's very good news to see our stocking distributors internationally start to purchase sets again. As you know, that's been something that has been slow, certainly, even as the recovery takes hold here. We're very encouraged, and we feel like that's a tailwind. Certainly, they're making investments because they believe that the market adoption of the products is accelerating and there's a backlog. You know, we talk about a $2.5 million backlog here in the U.S. It's a little easier to quantify that in the United States. We feel like internationally, we probably have an 18-month backlog, and we're only now starting to see the surgical environment normalize and us to start picking up on that backlog, which I think is borne out by the fact that our distributors are being more aggressive in their purchasing habits. Great perspective. I know it's early, but as you're sizing up things, how should we be thinking about your early perspectives on 2023, given the still expanding portfolio, recent acquisitions and new product pipeline? Could we see growth accelerate next year in a return to a more normal environment? I think with the acquisitions of MDO, Pega, and a very robust R&D pipeline organically, as well as in both of those businesses, we have a really nice setup for 2023 and 2024. Obviously, I haven't given guidance yet on what that looks like. Like I said at the end, our competitive position is extremely strong. When we improve our competitive position, we certainly believe that, you know, at the absolute worst case, we are honoring our commitment to 20% organic growth, and we'll remain a company that grows by 20% organically and likely 25%-30% with acquisitions. I think that's what we're set up to do for the several years to come. Perfect. Thanks again for taking the question. Thanks, Anton. Our next question comes from Ryan Zimmerman with BTIG. Your line is open. Good morning. Thanks for taking our questions. I wanna start actually with scoliosis, if I could, Dave. It was pretty good. You know, some of your peers have commented that the scoli market has been tougher this past quarter. Just, you know, would appreciate your perspective on kind of, you know, the performance you guys are seeing, not just the cadence, but, you know, where you think you're winning share from in scoli versus maybe some of your peers who have kinda given softer commentary about this quarter. Yeah. Thanks, Ryan. Listen, it's been a tough year so far when we think January through almost May. I know everybody's had some struggles on the scoliosis side, particularly even early into the summer. You know, we saw a nice bounce back here in June, expect that to continue into Q3. Think that's driven by increased adoption of ApiFix. Number of new users that we had, particularly in the month of June, that we're seeing schedule out into Q3. Then the adoption of 7D, you know, we talk about having 7D in that we sold a unit here at West Palm. That's great, but we have a number of units right now that are in the process of going through the earn-out process, and all of that drives incremental share gain. I think that's why we're so bullish about what the back half of this year could look like, really what the next several quarters could look like. Got it. That's helpful, Dave. Maybe turning to Pega for a moment. I mean, you know, certainly knowing about the company, they've been, you know, at all the POSNA meetings and so forth. How do you think about the opportunity to grow Pega, you know, through your distribution network, similar to what you're seeing, you know, with MD Orthopaedics and just, you know, going above and beyond kind of the expectations that you've laid out? Not to suggest that you're, you know, gonna exceed the $3 million you've laid out, but curious kind of what you're doing to maybe provide some upside to what those expectations are. Yeah. I think mid to long term is the story for Pega. Whereas MDO, we saw kind of immediate synergies because they have their own established distribution, and they were working through a number of distribution adjustments internationally, which I think is gonna benefit them in the short run as well as benefit us long term. Pega, as you, I believe, know, you know, Pega is a great firm when it comes to engineering and very innovative product development. Seven products, the main product FD rod is really known globally. Access to inventory, access to sales representation has always been fairly weak for Pega, not been their focus. You're right. I think once we can transfer this to our selling organization in the United States, which should start at September first, and we can order inventory which is on order and get new sets to the field, which is gonna take some time. Once those things occur, again, it could take a couple quarters here, but we think the growth of that segment of our Trauma and Deformity business could be, you know, really strong for the next several years. That's helpful, Dave. Just let me squeeze one last one, and I'll hop back in queue. You know, gross margins obviously came back to, I think, a more normalized level than we saw in Q1. Fred, you know, how are you thinking about it. I understand that was part of, you know, net purchases from international stocking distributors. Should we expect somewhat of a bounce back higher in the back half of the year as those distributors have kind of purchased their inventory this quarter? No, I think what we're seeing is actually what you said at the beginning, which is a return to more normal. In 2020 and 2021, without selling sets to the international partners, our margin artificially was higher. We did see what I would say is more normalized international stocking distributor purchases in Q2, and we would expect that to continue as it had prior to COVID. It was not a one and done situation. Every single quarter, we were selling sets as they were, you know, expanding their businesses. We would expect to continue to sell sets here in Q3,Q4 and each quarter next year. I think what we're seeing now is the more natural gross margin rate that we'll see going forward, which is still very strong, obviously. Yeah. Obviously. Thank you, Fred. Appreciate that. Our next question comes from David Saxon with Needham & Company. Your line is open. Yeah. Good morning, Dave and Fred. Thanks for taking the questions and, congrats on the quarter. Maybe one on Pega, one on backlog. For Pega, just wondering how meaningful that FD Nail is to the overall kids portfolio, and maybe remind us what the market is for that type of system and, you know, whether or not it can have pull-through across, you know, your product portfolio. Yeah, good question. That we've talked about this really moving us from about 85% of what a pediatric orthopedic surgeon does to 90. That last 5% is a big one because this product line opens us up into an area of the market for children with rare bone diseases. Given the fact that this, the FD rod is really unique in that there's really no competition, particularly in the United States for it gives us a pretty powerful position when you include that, those products into the balance of the T&D portfolio, when it comes to hospital contracting. I do think that it is pretty significant to our market opportunity. There's about 25-50,000 kids with osteogenesis imperfecta, so that's where the FD nail plays, and 25-50,000 in the United States. While we know a lot of surgeons know about the FD rod, again, I think historically, surgeons have been reluctant to call for it because it's been very difficult to get and not been supported by a selling organization that is, you know, dedicated exclusively to pediatric orthopedics. Got it. That's helpful. On the backlog, I think you called out you benefited from some rescheduled cases. Just wondering any way to quantify that benefit, and then recapturing the remaining 2.5, I think you said it was, should that be split evenly or does it follow your, you know, typical seasonality? If I can squeeze one last one in, I don't think I heard anything on ORTHEX, so, you know, any update on how that product is doing? Thanks so much. Yeah. You did hear that correct. We think there's about a $2.5 million backlog in the United States, primarily in elective limb deformity correction procedures as well as elective spine surgery. We don't believe that in Q2 we saw a big return or pick up on any of that $2.5 million. Likely that we'll see that pick up here in the next few quarters, hopefully between now and end of year. On the ORTHEX side, you know, ORTHEX is an elective limb deformity procedure, and so as we'd mentioned, April, May, pretty tough on all of those elective procedures. Better than Q1, but still not what we would expect from a normal environment. Again, we saw ORTHEX improve into June, seeing ORTHEX improve into Q3 and Q4, and I think it will positively be impacted by the backlog circumstance as well. Great. Thanks so much. Our next question comes from Samuel Brodovsky with Truist. Your line is open. Hi. Thanks for taking the question, guys, and congrats on a good quarter. I'll start with ApiFix. You touched a little bit on it in the prepared remarks, but just curious to hear, you know, any more granularity you could give us into where the registry or commercial rollout stands and, you know, as cases pick up and we get surgeons with a few years of experience here, how should we be thinking about that into 2023? Yeah, there's no question, Sam Brodovsky, that as surgeons get more data, we're not to 200 yet. You know, I think in this environment until June has really benefited our capacity to close the registry sooner. I think, you know, registry likely to close year-end, probably slipping into the first part of next year. That said, we have about as many commercial sites that have been trained, not all of them have scheduled cases yet, but have been trained and are starting to send in X-rays, as we have clinical sites or registry sites. We did see a nice bump in June, seeing really nice scheduling through July and into Q3. I think some of that is coming from new users. Others is coming from surgeons who now do have a year and a half of experience and are seeing results and are feeling more comfortable in scheduling additional ApiFix cases. Great. That's helpful. Fred, one for you. I got the commentary on probably lack of further acquisitions of scale going forward, but just how should we think about the balance sheet going forward and use of cash liquidity? Yeah, absolutely. You know, $52 and a half million dollars of cash, $31 of that was used the first day in Q3, July first with Pega. The good news is we continue to have another $19 million dollars of cash available to us on our line of credit. I think it also demonstrates the continued commitment from Squadron to be very flexible in the financing, which gives us a lot of leeway to effectively manage our balance sheet. We have used cash for our set builds, obviously. We've used cash to pay MDO earlier this year and to pay our ApiFix payment. We're very encouraged by the positive adjusted EBITDA, and that will continue both the rest of this year and then next year, which will start covering some of the set deployment numbers and reducing the overall amount of cash that's required to support the growth of the business. Great. That's helpful. Thank you. Thanks, Sam. Our next question comes from Daniel Stauder with JMP Securities. Your line is open. Great. Thank you. Just touching back on your gross margin. I know you mentioned that you haven't seen any meaningful inflation from your suppliers, but, you know, with that in mind, could you give us any color on your ability to maintain or even gain price compared to some of the adult ortho players should inflation become an issue? And then in that same vein, could you give us any color on whether the ped ortho market is, you know, naturally able to mitigate pricing erosion that you might typically see in the adult ortho industry? Any commentary there would be helpful. Thank you. Yeah, absolutely. Listen, we feel very fortunate in the environment that we live and work in. Traditionally, we have been able to get a little bit of price. We have been able to get a little bit of price to offset inflation. This year we did go out with a little bit of a higher price increase to offset transportation where we are seeing inflation, and to be a little proactive on this. We're confident that we'll continue to be able to get enough price to cover the inflation impact that we would see today or into the future through our business. The second question on—was it Pega? Pega, yeah. Yeah, I think there is opportunities as we increase the value overall of the customer experience with Pega to gain pricing within the Pega portfolio and particularly in the United States. I would also argue that, you know, that we talk a lot about FD, but Pega has six additional products. For the most part, you could say that those products haven't been launched in the United States. We have opportunity both on the pricing as well as just the pure, you know, launch. I mean, it's almost like we're looking at, you know, six, seven new product launches for our Trauma and Deformity portfolio in rapid succession over the course of the next 12 months. Yeah, on the pricing side, of course, there's opportunities for us there. I just think for the scale of our T&D business and the, you know, the competitive position, it also gives us some leverage in those circumstances. Yeah, I would just add that launching those products will take some time, right? We have to order the products from the suppliers. It probably will have at least a four to six month lead time to get those sets in on the PEGA side. We'll be launching those hopefully later this year and/or early into 2023. Great. Thank you. Just one quick one. Just looking at the set deployment, you reiterated guidance for the year and commented on some of the slight delays, but could you give us an idea of the cadence of the spend in the back half of the year? You just mentioned some of it, but any incremental investment needed for Pega sets or is that more of a 2023 concern? Yeah, the number that we reconfirmed does include, in fact, 70 as we mentioned earlier in the year, as well as some little amount of Pega, which we'll be able to get from our suppliers and start deploying this year. The majority of the Pega will be into 2023. The cadence of that is gonna be pretty consistent month after month after month throughout the rest of 2022. Great. Thank you very much. Thank you. There are no further questions. I'd like to turn the call back over to David Bailey. Well, once again, thank you everybody for your time. Thank you for your questions, and we'll look forward to seeing you at conferences in the future. Thank you. This concludes the program. You may now disconnect. Everyone, have a great day. The conference will begin shortly. To raise your hand during Q&A, you can dial star 1 1.