Vericel Corporation Q3 FY2025 earnings call

The company delivered outstanding financial and business results in the third quarter with strong top-line growth and profit growth. MACI's growth was driven by expanding the surgeon base, double-digit biopsy growth, and strong early launch indicators for MACI Arthro, with over 800 trained surgeons by the end of October. The MACI sales force expansion is on track to be completed in the fourth quarter. Long-term initiatives include initiating the Phase III MACI Ankle clinical study and commercial manufacturing in a new facility. Burn Care also had a strong quarter with Epicel and NexoBrid showing growth.

Vericel Corporation achieved record third quarter total revenue of $67.5 million. MACI's revenue in the third quarter was $55.7 million, representing a 25% increase year-over-year, accounting for approximately 82.5% of total revenue. Burn Care's third quarter revenue was $11.8 million, a 21% sequential increase from the second quarter. Epicel generated $10.4 million, the highest quarterly revenue of the year. NexoBrid had $1.5 million in revenue, the highest since launch, with 38% year-over-year growth and 26% quarter-over-quarter growth.

Full year total revenue is expected to be approximately $272 million to $276 million. MACI's full year revenue is projected to be $237.5 million to $239.5 million with Q4 revenue of $82 million to $84 million, maintaining low 20% growth. Burn Care's full year revenue is expected to be $34.5 million to $36.5 million with Q4 revenue of $6.5 million to $8.5 million. Gross margin is expected to be 74% and adjusted EBITDA margin is 26% for the full year, with Q4 gross margin approximately 77% and adjusted EBITDA margin around 40%.

Potential impacts from government shutdown on BARDA-related opportunities for NexoBrid. Variability in insurance policies regarding lesion size and their potential impact on MACI Arthro adoption.

Q: Josh Jennings from TD Cowen asked about MACI Arthro contributions in 2026 and how to think about MACI growth.

A: Joseph Mara responded discussing MACI's growth expectations, starting prudently with guidance, and MACI Arthro's positive trends but being prudent on guidance.

Q: Richard Newitter from Truist Securities asked about MACI Arthro application and sales force.

A: Dominick C. Colangelo responded on MACI Arthro's broad-based application and sales force expansion progress.

Q: Ryan Zimmerman from BTIG asked about lesion size impact on MACI Arthro and MACI sales force.

A: Dominick C. Colangelo responded on no impact from lesion size and sales force completion status.

Q: Caitlin Roberts from Canaccord Genuity asked about Burn Care trends, BARDA, and CPT code.

A: Dominick C. Colangelo responded on Burn Care trends, BARDA uncertainty, and CPT code plans.

Q: Jeffrey Cohen from Ladenburg Thalmann asked about R&D and postsurgical pain.

A: Joseph Mara and Dominick C. Colangelo responded on R&D spend and details on postsurgical pain from MACI Arthro cases