ANIK

Strategic Priority 1: Accelerate Sustainable Revenue Growth

• Delivered record commercial channel revenue growth of 17% year-over-year, driven by broad-based growth across international OA pain management and regenerative solutions businesses
• International OA pain management franchise (Singhal, Monavis) delivered sustained growth: 23% year-to-date growth for Singhal and 19% for Monavis, adding over $3 million in incremental revenue in H1 2026, following portfolio alignment completed over the prior 18 months
• Regenerative solutions growth remains solid: larger-sized Integrity products launched late 2025 exceeded initial adoption expectations, with post-market study enrollment on track to complete in coming quarters to support EU regulatory filing; Hyalafast continues to deliver double-digit international revenue growth
• OEM channel growth was driven by strong Monovisc demand from partner DePuy Synthes (J&J), with underlying demand trends remaining encouraging, while smaller legacy OEM programs collectively contribute meaningful shareholder value

Strategic Priority 2: Drive Operational Excellence & Discipline

• Gross margin expanded to 65% in Q2 2026, up from 51% year-over-year, marking the third consecutive quarter of gross margin above 60%, and the highest adjusted EBITDA ($7.1 million, 22% margin) since 2020
• Completed two key manufacturing capacity/upgrade projects in H1 2026: doubled throughput on the Monovisc and Singhal production line that was previously output-constrained, and upgraded the Orthovisc and non-orthopedic manufacturing line to improve yield, throughput, and efficiency
• Reduced adjusted operating expenses by 6% year-over-year, with G&A expenses (excluding one-time severance) declining 30%, driven by organizational streamlining and disciplined spending; R&D spending increased to $7.3 million (from $6.3 million year-over-year) to prioritize pipeline development
• Completed a $15 million share repurchase program in H1 2026, reducing diluted shares outstanding to ~13.3 million, the lowest level in over 15 years; stock-based compensation declined 28% year-over-year to reduce shareholder dilution
• Ended Q2 with $38.4 million in cash, no debt, and an amended credit facility that provides up to $100 million in total borrowing capacity for ample financial flexibility

Strategic Priority 3: Advance Hyaluronic Acid (HA) Innovation Pipeline

• Hyalofast: Ongoing PMA review with the FDA; the company is preparing a response to the agency's deficiency letter, expected to be completed in the coming weeks; co-primary clinical endpoints are the key focus of the review, which may impact approval timeline, but confidence in the long-term U.S. opportunity remains unchanged
• Syngal: Bioequivalence study enrollment remains on track for completion by the end of 2026; current focus is expanding CMC (chemistry, manufacturing, controls) capabilities to meet FDA drug manufacturing requirements for this combination product, which will be the final workstream ahead of NDA submission
• Early-stage pipeline: The regenerative suture and tape program continues to deliver encouraging early progress, demonstrating the versatility of the company's HIAF fiber platform for soft tissue repair applications

• Full-year 2026 OEM channel revenue guidance was revised upward to 0% to 5% growth, from the prior expectation of a 5% decline to flat revenue
• Full-year 2026 commercial channel revenue guidance was narrowed to 12% to 18% growth, from the prior range of 10% to 20% growth, supported by sustained international OA growth and Integrity adoption
• Full-year 2026 total company revenue guidance was revised upward to 5% to 10% growth, from the prior range of 1% to 9% growth
• Full-year 2026 adjusted EBITDA margin guidance was revised sharply upward to 13% to 17%, from the prior expectation of 5% to 10%, reflecting broad operating leverage; second-half 2026 profitability is expected to be modestly lower than first-half results due to OEM order timing
• For 2027, ANACA adopted a new revenue guidance practice that only includes revenue from products that have already received regulatory approval/clearance, excluding previously implied U.S. Hyalofast revenue; despite this change, the company expects total 2027 revenue to grow 0% to 5% year-over-year

Total company revenue for Q2 2026 was $32.6 million, representing a 16% year-over-year increase. Year-to-date total revenue through the first half of 2026 was $62 million, up 14% year-over-year.

• Commercial Channel: Revenue grew 17% year-over-year to $13.9 million, contributing 42.6% of total Q2 2026 revenue. International commercial revenue reached a record $12.6 million, up 22% year-over-year. Within this segment: Singhal grew 32% year-over-year, Monavis grew 24% year-over-year, and together added $2 million in incremental profitable revenue in Q2. Integrity (regenerative solutions) saw year-to-date sales up 39%, with revenue just under $2 million for the second consecutive quarter, and international stocking orders up over 50% year-over-year. Hyalafast delivered double-digit international revenue growth.

• OEM Channel: Revenue grew 14% year-over-year, contributing 57.4% of total Q2 2026 revenue. Growth was driven by stronger-than-projected Monovisc unit volumes that offset lower-than-expected Orthovisc revenue, partially boosted by favorable order timing. Year-to-date OEM performance supports the raised full-year growth outlook, with quarterly variability expected due to customer ordering patterns.

• Forward-looking statements regarding regulatory approval timelines, future revenue, and profitability are subject to inherent uncertainties, and actual results may differ materially from guidance; ANACA does not commit to updating forward-looking statements after the call
• OEM quarterly revenue can be volatile due to variable customer ordering patterns, creating sequential variability in results
• Pricing in the U.S. OEM OA market faces ongoing headwinds, with expected modest price erosion that must be offset by volume growth
• FDA review timelines for Hyalofast PMA approval are outside of ANACA's control, and review of co-primary clinical endpoints may impact the final approval timeline
• CMC development for Syngal as a drug combination product requires building a new regulatory-compliant manufacturing framework, which could introduce delays to NDA submission

Q: The raised full-year OEM guidance implies a meaningful sequential revenue decline in the second half of 2026. Is this driven by first-half order timing, or is it related to underlying pricing or volume trends? / A: Approximately $1 million to $2 million of Q2 2026 OEM revenue came from favorable order timing, which explains part of the expected sequential step-down. The other factor is a very strong fourth quarter 2025 that creates a difficult year-over-year comparison for Q4 2026. Overall, the guidance upgrade reflects stronger underlying U.S. end-market demand than previously expected, and full-year 2026 OEM revenue is now projected to grow year-over-year, a positive change from prior expectations of a decline.