CollPlant Biotechnologies Ltd. Q2 FY2024 earnings call

• Breast implant program: Made progress in producing commercial size implants using proprietary rhCollagen-based bioinks printed with Stratasys' Origin one 3D bioprinter. Testing 200 cc volume implants in preclinical studies. Aim to address the $6.5 billion global breast implant market, which is underserved in safety and performance. Preclinical studies show evidence of tissue regeneration and no adverse reactions, with results expected in Q4 2024.
• Dermal filler collaboration with AbbVie: In clinical phase. Reached a $10 million milestone in 2023. Expect potential additional milestones and meaningful royalties on commercialization. Also, development of photocurable dermal filler with granted patents in multiple territories.
• Corporate sustainability: Released first environmental, social and governance report, focusing on pillars like climate action, health and safety, and sustainable sourcing.

GAAP revenues for the second quarter ended June 30, 2024 were $249,000, compared to $10.2 million for the second quarter ended June 30, 2023. The decrease in revenues was mainly due to the absence of the $10 million milestone payment from AbbVie in 2023. GAAP cost of revenues for Q2 2024 was $536,000 vs $615,000 in Q2 2023. GAAP gross loss for Q2 2024 was $287,000 vs gross profit of $9.6 million in Q2 2023. GAAP operating expenses for Q2 2024 were $4.1 million vs $3.9 million in Q2 2023, with the increase mainly related to employee salaries and share-based compensation. GAAP net loss for Q2 2024 was $4.2 million vs net income of $5.8 million in Q2 2023. Cash and cash equivalents as of June 30, 2024 were $18.9 million, with a cash runway expected to satisfy operations until at least the end of 2025.

• Continue advancing the dermal filler program with AbbVie, including running clinical studies. - Generate additional safety and efficacy data for regenerative breast implants in support of future clinical studies and commercialization. - Form collaborations with industry leaders for utilizing rhCollagen and bioink technologies. - Continue discussions related to potential collaborations on existing programs and products.

• Forward-looking statements may not materialize due to various risks, uncertainties, and factors set forth in CollPlant's SEC filings. - Regulatory challenges in getting approvals for medical products. - Market factors affecting the adoption of regenerative medicine products.

Q: What are the key differences between the latest breast implant and the dermal filler work with AbbVie?

A: Breast implants are 3D bioprinted scaffolds that recruit cells to form natural tissue and degrade over time, while dermal fillers are injectable products in clinical phase.

Q: What are the next steps for the AbbVie collaboration?

A: The dermal filler is in clinical phase, with no disclosed timelines for studies or milestones, but expecting potential milestones totaling $26 million and royalties on commercialization.

Q: What growth factors are in the collagen scaffold and the process of the scaffold dissolving?

A: No growth factors are used. The scaffold recruits cells, degrades via enzymatic, hydrolysis, and oxidation over 6-12 months, with newly grown tissue taking over load bearing.

Q: How predictive are animal models for human application?

A: Animal models are predictive, and computational biomechanics modeling is used to mimic scaffold behavior in humans, complementing preclinical studies for FDA submission.

Q: Are you talking to major implant makers?

A: Yes, talking to major players in the arena but not obligated to anyone yet, focusing on taking the product to market for proof-of-concept.