All right. Afternoon, everybody. Thanks so much for joining us. Matt O'Brien, I cover MedTech here at, at Piper. Very, very fortunate to have the OrthoPediatrics team here with us. From the company, we've got Dave, who's the CEO, and then Fred, who's the CFO and COO, which I almost always forget, but I didn't this time. Thanks so much for coming out. Really appreciate it. Thanks, Matt. Thanks for having us. So let's talk about Q3 a little bit. You know, overall, trauma deformity was really strong again, and that just gets completely missed, I think, a lot of times by investors, how good that business is, and steady and big and... But then spine was a little bit softer than I think some had expected. So maybe just talk about the dynamics you saw in Q3, specifically between those two businesses. Yeah. Yeah, great. And thanks, Matt, for having us. Appreciate it. Yeah, as you mentioned, you know, strong quarter overall, good top line revenue growth combined with a really nice bump in Adjusted EBITDA. So we felt really good about the way the business performed in Q3. Knew going into the quarter with comps on the scoliosis side, it could be tough. I think we had 33% international growth, 38% domestic growth in scoli in the quarter, in Q2 or Q3 of 2022. So knew that was gonna be tough, and certainly still dealing with some of the headwinds associated with three of our largest ApiFix, as well as fusion customers moving from account to account. That probably accounted for, you know, $750,000 or so. And, you know, on a business that's generating $10 million in revenue, give or take in a quarter, yeah, it's gonna affect our growth rate. So it's a fairly, fairly small business still that's, you know, still feels the gyrations of a few big customers going from account to account. Also saw some ordering patterns in Brazil in particular, that weren't favorable for us, but are not likely to continue into the future. So, yeah, I think, you know, we would have preferred the number to be greater, but overall, to see the top line come in the way it came in, to see the trauma limb deformity business perform the way it performs, really strong, and then to see the international business really get back to what we had historically seen with that international business growing in excess of 20% faster than the domestic business. I think in the quarter, it was 26% overall, and that was with negative growth on the scoli side. So yeah, domestic scoli and international scoli, I think we had a blip in the quarter, but not something that we're gonna, you know, lose a lot of sleep over, frankly. Got it. Just good to see the business performing in general overall, really strong. Got it. And then on the complex side, I think this is something that's tough for people to get their heads around. Have you had three surgeons move at the same time and had to absorb that kind of movement historically? And then, you know, you don't lose those surgeons. They typically come back and use your products just at a different hospital. Is that fair? Yeah. Yeah, and I mean, we've had surgeon movement, again, in pediatric orthopedics inside a children's hospital setting. There's only 400-500 surgeons in the United States that actually do these procedures. So a few big surgeons who carry a lot of volume can impact the whole, the whole business. Yeah. And it's happened, I suppose, in the past, but probably not as affected us nearly as great. One of the things that's unique about this situation is that these were three of the largest ApiFix users, and fir- Wow! three of the first 10 users of ApiFix that we onboarded through the IRB process. So not only when they move, do you miss out on some of the volume there- Yeah ... but you have to go back through the process to get IRB approval at the next account, and we've been going through that process. September, and we called this out on the call, we started to see some scheduling pick up from those guys. Had pretty good line of sight into Q4 in terms of what our volumes and our surgery schedule looks like in Q4. And, you know, expect that as these guys come back online, and again, we onboarded more users in ApiFix and the fusion side of our business than we typically do in a quarter, just didn't flow through revenue. So I would expect that to turn into a tailwind for us in 2024, and it could be $2 million. Can you talk about that specifically? Why did you see more onboarding this quarter than normal? I- Was it a combination of ApiFix plus- Yeah -fusion? I think what we're seeing, and it's kind of a broken record here, is this combination of the power of, of the RESPONSE system that's been out there for a while, but the RESPONSE fusion system connected to 7D, and more and more surgeons getting exposed to our scoliosis platform overall through their interest in ApiFix. And so, I think the three of those technologies combined, not the least of which is the interest in ApiFix, and on the non-fusion side, really driving relevance in the product portfolio and, helping us onboard, new users on all sides. Okay, got it. So talk a little bit about Trauma and Deformity, which again, I think is really underappreciated part of the business. That growth that you've seen, which is really strong again in Q3, how much of that is existing accounts just kinda going deeper with some of those, versus new products? Because the thing I'm really trying to get to is, I know you're in all the big centers- Mm-hmm ... but you still have doctors that'll take a, you know, adult product and cut it down and use it for whatever, you know, procedure they may need. Where are you in that curve of really trying to get, you know, all of these accounts to flip over to something that's anatomically designed for children? Yeah. Yeah, good question. So I think we are definitely in the process of getting deeper and deeper within the children's hospitals on the trauma limb deformity side. We would say that maybe we have a 25%-30% share in the United States in trauma limb deformity, much, much smaller outside of the U.S., you know, newer businesses, so, you know, we expect that business to grow more rapidly. We normally lead with the most innovative, differentiated products and then are working hard to try to get to a position where we're so relevant inside the children's hospitals with the very differentiated things, that it pulls forward our cannulated screws, our flexible nails, a lot of the products that may be still differentiated, but not as differentiated as some of our very unique trauma limb deformity products. I think the acquisition and ultimately the commercialization and success we've had with the Orthex product line have really kind of cemented that full portfolio as being super relevant to children's hospitals. Probably 90% of what a pediatric orthopedic surgeon can do in trauma limb deformity, they can now do through us. And so, again, as we take more and more share, that positions us kind of the depth in an account to then go for a single vendor or at least a dual vendor contract. And, you know, the competitive environment is extremely benign, so most of this is share taking at the expense of kind of incumbent providers of products, where there's been a lot of inventory that just simply lives in a children's hospital. So getting the hospital and the surgeons to agree that, "Hey, you can get rid of some of this stuff that you've had for a really long time and be supported entirely by OrthoPediatrics' full portfolio," it takes some work, but it's part of our strategy. We think that there's a certain inevitability to getting to maybe 50%-60% kind of share position. And again, we're not in this competitive, you know, high-stress, competitive environment on the trauma deformity side, so we're methodically, quarter-over-quarter, year-over-year, taking share, and we expect that to continue for a while. Okay. Is there a competitive... or is not competitive, a contracting component, though, that keeps you at certain hospitals from getting deeper and deeper? We do run into contracts, more particularly when they, when there may be a large adult contract- Yeah ... where a children's hospital is kind of connected to an adult hospital, where we have to work with hospital leadership and with our surgeons to make sure that they are differentiating between the needs of the children's hospital and the pediatric orthopedic surgeons versus the needs of your general traumatologist or your general orthopedists that are taking trauma call. Okay. Sometimes we have to do that, and it takes a little bit of time, but I would say we're starting to win more of those types of contracts than we have historically. Again, as our share position goes up, you know, we're being, I would say, we are being invited into that discussion more than we have historically. Do you have the capabilities from a contracting perspective to be effective on a national accounts basis? Yeah, certainly. Okay. Because I'm sure in your history, you've done some of that, you know? Yeah. I- Okay. We certainly. Again, I think our relevance here is because of the full breadth of portfolio. And so in certain circumstances, historically, we have had children's hospitals go on contract with the likes of another, maybe trauma company. But in most instances, then our products are just being pulled in and out of that account because no company provides the kind of unique products necessary for a children's hospital. Okay, got it. 200 big hospitals in the U.S., children's hospitals in the U.S., roughly. Do you have 10 of those that are doing 80% of their cases with you guys at this point? We would say, there's about 300 children's hospitals, where about 62% of all pediatric orthopedics occurs. There's about 1,500 pediatric orthopedic surgeons in this country. Every one of those children's hospitals is a customer of ours, from, you know, using one of our 50 products to 48 of our 50 products. I would say 15-20 accounts or so, we're probably at 80%, particularly on the trauma limb deformity side, an 80% share take. And, you know, there's still a lot of accounts where we're, you know, we're in the single digits, and so opportunities for us to really grow. That's why we still think we're in the early innings still of share taking on the trauma and limb deformity side and the scoliosis side. Understood. Got it. And this probably is for the instrument czar over there, which is Fred. You know, during the IPO process, sets were the, "Hey, we're going to deploy, you know, use this capital for a lot of set deployment, follow on still set deployment." Where are you at in that curve of having the sets you need to be able to support 50 products? Yeah, absolutely. So prior to the IPO, we were deploying maybe $3 million a year in annualized sets. This year, we'll deploy about $23 million. Yeah. A dramatic increase in the sets that we're deploying. That is what enables us to take share in these markets. I would argue that we are in a similar 25%-30% as we have market share. That's about how far we're along in set deployment. This year, a lot of that set deployment was in the Pega product lines. Tremendous opportunity there, as well as new products that we're launching and, you know, a ton of the legacy products that have been out into the marketplace for five, some of them even 10 years, that we're still deploying additional sets. So, early innings, I would say, in the set deployment. With that being said, the MDO clubfoot bracing business, new platform business that we brought on, a couple of years ago, has basically proven to us that we can create another avenue of growth for the business that does not require additional consigned inventory, year after year after year. And so we like that model, we like the return on investment, and we'll be prioritizing that as a growth lever for us, particularly in 2024 and beyond. Okay. Same thing with ApiFix, too? Very low- Absolutely. So, the consignment, you know, zero consignment is good. ApiFix is probably 15 to 1 compared to our, some of our legacy products, and Orthex is probably third in line as far as efficiency of capital and the return on investment. Okay. And you guys know what a big fan of ApiFix I am. Is it 2024 for an inflection, or are you still gonna be more, "Hey, we're just gonna continually, you know, to be thoughtful about how we're rolling this thing out, because, you know, we want to make sure it's working as effectively as possible? Yeah, I, I think we will continue to be thoughtful, certainly, about the way this rolls out. I think it is really important that we don't kind of throw this to the four winds. I think it is. There's a risk that if you do that, you have studies that crop up from institutions where maybe a surgeon didn't follow the indication- Yeah as clearly, and there are potentially a number of applications for ApiFix outside of the indications where it could work really well. So I understand the temptation for surgeons to try it on certain patient populations. At this stage, we're trying to manage that, and, you know, I think doing a good job. We still require all customers, whether they're from a commercial site or a registry site, to submit their X-rays and their information to a group of KOLs, international group of physicians, that look at that and then either approve that patient or disapprove of that patient. And I think in part, you know, we ensure that then what goes into our registry or what—where this device is placed, it's placed in the right patients. But it also helps educate the physicians as to what is the right patient for ApiFix. And I think that's what we're all learning on the non-fusion side of the business, right? This is an embryonic market, more and more patients seeking non-fusion treatment, whether that's a tether or whether that's an ApiFix device. And I think everybody's trying to learn, what are the appropriate patients? What's the patient population? And it's easy, I think, for surgeons to get pressured by families, the children who want these procedures, because no one wants a surgical fusion- Yeah for the rest of their life if they can avoid it. Right. So we're going to stay rigorous there. I can say that maybe as we look at the trajectory of ApiFix going forward, a few years ago, when we acquired this, we might have thought that there was going to be this singular inflection point where this thing, everybody agrees this is settled science, and these are the patients. I'm not sure that's our position at this stage. I think this is a pretty consistent up and to the right thing that's growing dramatically faster than our fusion business. But I think this is seeing the entire segment of the non-fusion market grow. And as more and more of our data is aged, more and more surgeons, kind of in the bell curve of users, get comfortable with where ApiFix fits within their practice. Okay. Okay, and I, you know, I don't want to pin you to a number here, but, how big can this product get to? I mean, can it be a $50 million-$100 million product eventually? Yeah. I mean, I don't think that it's going to happen in the short term. Sure. But certainly, we think that the segment of non-fusion segment, where there are very few players right now, is going to be a much faster-growing segment within the scoliosis world right now. And so I think as that embryonic market matures and as the, you know, we move out of the very early adopter phases, this could be a, you know, this could be the largest product that we have, single individual product that we have within our portfolio within the next several years. Okay. Okay. You mentioned from MD Ortho a little earlier. What have you done in terms of refining that product since you brought it in-house? Or those products, I should say. Yeah. So MDO is the company we bought. They have the number one market share in clubfoot bracing, and that was really their only product. With Joe, Joe's leadership here, we have continued to refine that product. We now have an adjustable angle on the feet with springs to help assist in the correction. We're also coming out with the MDO Lite, so a lighter version of that product, and a couple other versions that we'll be launching. So, not only new product introductions, but also just having their product tied to our brand inside of the hospital, has driven nice growth from that business. And it's given us a platform that we can then continually launch other products. So a DF2 is another, it's a hip deformity bracing product that's coming out that'll go along with that business. And that's really in the domestic marketplace. Outside of the United States, they also sell to probably 70 markets through stocking distributors. And so that gives us another channel to market in many countries that we're not selling to today. So we can look at putting additional OP legacy products through those channels in the future as well. So it's been a really nice platform for us to increase growth of the overall business and to really build another growth driver for us going forward. Got it. How much of the $600 million market can you address with the clubfoot bracing product and then also the hip bracing product? We think the $600 is kind of specialized bracing. The foot and ankle is probably half of that, call it $300. The MDO really focuses on that foot and ankle, and then the hip would be in the other portion of it. Okay. But honestly, it's probably not even in that TAM, because today, that is treated through casting. Okay. Right? So they cast those kids, which if you think about a very, very young child having a cast just above the knees to, you know, lower chest with diapers, it's, it's not a good situation. Okay. And so this hip brace enables them to stabilize the hip, but at the same time, avoid casting the child, which is a huge benefit, not only for the child, but also for the parents who are trying to take care of them. And so really, it's not even in that TAM, but it is expanding that TAM with a brand-new product. Understood. How fast can MD Ortho grow over the next several years? Is it 25%-30% growth? It's much faster than our overall growth of the business, which is 20% plus. You know, we're targeting to have a $100 million specialty bracing business in the coming years. So MDO is a start, and we've got a lot a long ways to go to get there, but we're headed down that path pretty aggressively. How does the profitability profile of that business look versus your core business? Yeah, so when we bought the business, it, it was number one on net income and cash flow positive. It does not have consigned inventory, as I mentioned earlier, and so we can grow the business very aggressively, maintaining that profitability. We're not trying to maximize the profit of the business, but at least breaking even. And the last thing I would say on that business is, in a world of ever-increasing regulatory requirements, like EU MDR, and all of those incremental requirements that are placed on the implant side of the business, this has a lower level of regulatory. So we can introduce, have an idea, develop the product, introduce it to the marketplace within six months on that side of the business- Wow! Okay. -which is very unusual. On the implant side, it would take much longer. Got it. What's really compelling for me is you see the specialty bracing business. MDO was, you know, the acquisition for a platform to ultimately attract other ideas, other inventors, other small companies, and we have literally been bombarded with a combination of good ideas or opportunities for partnerships, opportunities for small asset acquisitions that we can scale through our global sales channel. That is all happening, and I think that's giving us this confidence to say, "Hey, this is another very substantial lever of sales growth that surrounds the pediatric orthopedic surgeon, just like our implant systems do," and it helps build, right? Yeah. We look a bit heroic to a lot of our customers because we're doing something that the larger ortho market hasn't wanted to do. Yep. And that's what we did when we built the surgical business. And so being able to really meet these specific unmet needs, it, there's a correlation to what we think will drive implant business as well and building that relationship. Does that make sense? Makes total sense. Yeah. Okay. Pega doesn't get as much love as I think it deserves, 'cause we don't understand osteogenesis imperfecta unless you watch whatever movie that was with Samuel L. Jackson. But just talk about the uptake that you've seen from that product, and then, you know, what are your expectations for growing that business, especially internationally? Yeah. So I always appreciate the questioning because you ask us about our trauma limb deformity business more than-more than most. 75% of our revenue comes from non-spine. Yeah. You know, I think sometimes we get put into a category as a spine company, and we are not. Yeah. We're, you know, a pediatric orthopedic company, and we would, we obviously have seen our scoliosis business grow faster. It's a less mature business, but, you know, we continue to grow T&D very rapidly. And I agree, Pega and probably the credit for the acquisition and how fast we've grown that business post-acquisition was probably, you know, part of a story that wasn't fully understood by the investors. You know, that business, when we bought it a little more than a year ago, was similar, profitable, generating some cash, but not growing at all. 50% of the revenue was in the U.S., 50% outside of the U.S. And so since taking over just the sales channel side of this in the United States, we've nearly doubled the domestic business in about a year. Wow! The international business has been flat to negative because we were in the process of converting all of their stocking distributors in all these markets to our distribution network or our sales agencies, particularly in Europe and in Australia. And so you can imagine, those distributors were not exactly eager to add inventory, to buy sets, in a period of time where they knew they were gonna lose, ultimately, the product line. So in Q3, we saw growth internationally for the first time from Pega. We've completed 90+% of the distribution and agency transitions. So it's kind of what we see in the United States, with this kind of rocket ship growth domestically. We would expect to see that, internationally. We saw it even in the first quarter, where we took over the sales channel. And then, you know, U.S., there was very little inventory. I mean, you're talking about $200,000 worth of inventory pre-acquisition. Now, we're talking about several million dollars worth of inventory. You gotta realize this is not one product, it's seven products. Yeah. So the combination of launching those products, getting inventory in the U.S., is driving growth. We expect that to grow substantially faster than kind of our normal 20% rate for the next several years. And then, OUS, we're just starting, so it's probably a year behind the growth that we've seen already in the U.S. And as we get inventory and the sales channel going there, we would expect to see, you know, several years of growth, you know, in excess of 20% outside of the U.S. as well. Got it. Okay. Lots of, lots of growth drivers there. Real quickly on the acute side, my son just came home from, from college. He's sick. All of his friends are sick. How bad is RSV looking this year? RSV is definitely increasing. The numbers show a very steep curve. However, it's about half of where it was this time last year. Got it. With that being said, half of last year is still the second highest we've ever seen. Yeah. So it's there. Last year, this time, the hospital, the pediatric, the children's hospitals were full, the beds were full of kids. Doesn't feel that as severe this year, luckily, so it's much better than it was last year. Okay. December is a wild card, so we'll see. But at this point in time, we're pretty lucky that it's not as bad as it was last year. You had built that into guidance, too? Absolutely. Okay. Absolutely. Staffing still a headwind as well? It is. Okay. It is. Okay, and then just last 90 seconds here, Fred. On the profitability side, which congrats again, on nice, really Q3. This year, I think it's gonna be up about $4 million- Correct. at the midpoint of the range versus last year. Is that kind of the level of improvement we should expect from the business going forward, or can it get even better with MDO and with ApiFix? Yeah. No, I think that is the level of improvement with the revenue growth that we saw this year, over 20%. So if we see something similar to that in 2024, we would see another stairstep increase in the Adjusted EBITDA. And then the goal is to get that number to equal our annual set deployment and to get the business to cash flow breakeven in the next three years. Okay. We have $84 million of cash, $50 million dollar line of credit available to us. We think we have the balance sheet enabled to get us where we need to be in three years. Okay, and then just real quickly, cash flow breakeven in three years, that's 2026. Is that the right timeframe? Yeah. -for cash flow breakeven? Got it. And finally, M&A-wise, I mean, it just sounds like there's still a lot of assets that you're looking at there. I mean, should we just expect, you know, to continue to fold in some more assets over the next several years? Yeah, I think particularly as you look at the nonsurgical specialty bracing side, there's a lot of small assets, interesting partnership opportunities, and we would want to continue to be fairly aggressive on that side. Makes sense. Well, really good feedback here. Lots of growth, you know, in front of the company, and profitability is getting better, so lots of things to like here. Thanks, man. Appreciate it. Thanks for having us.