TLSI - NASDAQ

Good day, and welcome to the TriSalus Life Sciences Fourth Quarter 2025 Earnings Call. At this time, all participants are in a listen-only mode. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Mr. Jeremy Feffer, Investor Relations. Please go ahead.

Thank you, operator, and thank you all for participating in today's call. Joining me today from TriSalus Life Sciences are Mary Szela, President and Chief Executive Officer; David Patience, Chief Financial Officer; and Dr. Richard Marshak, Medical Director. Ms. Szela will provide an overview of the company's first quarter results and strategy for the balance of the year, and then David will review the financial results for the quarter in detail. Following their prepared remarks, Dr. Marshak will join the call to help address questions from covering analysts. Earlier this afternoon, TriSalus released its financial results for the quarter and year ended December 31, 2025. A copy of this press release is available on TriSalus' website. Before we begin, I would like to remind you that management will make statements during this call that include forward-looking statements within the meaning of federal securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Any statements contained in this call other than the statements of historical fact are forward-looking statements. All forward-looking statements, including, without limitation, statements relating to our sales and operating trends, business and hiring prospects, financial and revenue expectations and future product development and approvals are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties, including the impact of macroeconomic conditions and global events that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please refer to the Risk Factors sections of our Forms 10-Q and 10-K on file with the SEC and available on EDGAR and in our other reports filed periodically with the SEC. TriSalus disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements with new information, future events or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, March 5, 2026. And with that, I'll turn the call over to Mary.

Thank you, Jeremy, and good afternoon, everyone. Thank you for joining us for a review of our 2025 fourth quarter and year-end financial results. I'll begin with a high-level review of our results for the quarter and the year, recap some of the highlights from recent weeks. And then provide an overview of our longer-term strategy and expectations for 2026 and beyond. David will follow my remarks with a more in-depth review of our financial and operational results for the reporting periods. And we'll be happy to open up the call for your questions. Let's begin. I'm pleased to report that our results for both the fourth quarter and the full year were strong. Fourth quarter revenues were $13.2 million, and full year revenues were $45.2 million, representing a 60% and 53% increase, respectively, over the prior year periods. Importantly, we achieved our revenue growth guidance for the 2025 fiscal year. Our strong commercial performance for the year was driven by consistent execution of our commercial strategy, and our expansion of our TriNav product suite and proprietary PEDD platform across a broad range of indications beyond the liver. In recent weeks, we took significant steps to strengthen both our Board and our balance sheet. In February, we announced the appointment of Veteran Health care Investor, Michael Stansky to our Board of Directors. Michael has a strong track record as an investor and board member across the health care landscape with deep experience in capital markets, governance and value creation. We believe he will be a meaningful asset to TriSalus as we continue to execute on our growth objectives. Also in February, we announced the completion of a public offering through which we raised $46 million in gross proceeds from fundamental health care investors. The financing was more than 2x oversubscribed and was supported by experienced health care investors who share in our conviction in the long-term value of the PEDD platform. Importantly, these investors understand that building a category-defining company requires disciplined investment in commercial infrastructure, clinical evidence and product innovation. This capital enables us to lean into our strategic priorities from a position of strength. Our primary strategic priority is to expand our sales and commercial infrastructure which we initiated at the beginning of the year to more effectively drive adoption and long-term success across our portfolio. Second, we are investing aggressively in foundational clinical studies to further demonstrate and validate the value of pressure enabled drug delivery, PEDD. These studies are critical to reinforcing the clinical and economic differentiation of our PEDD platform and will fuel continued growth in 2027 and beyond. And third, we're continuing to enhance and evolve our PEDD technology. to strengthen physician adoption and utilization, not only in liver embolization, but also across our expanding set of new applications. The success of the upside financing and the quality of investors brought into the company through the process are highly validating of our strategy and the growth opportunities before us. Based on our performance in 2025 and our visibility entering 2026, we are reaffirming our revenue guidance of $60 million to $62 million. As is typical for emerging growth companies investing ahead of a steep adoption curve, expanding our commercial footprint requires upfront hiring, onboarding, training and current territory realignment, which will influence revenue cadence in the first half of the year to be approximately 40% and revenue in the back half of the year to be approximately 60%. We believe the significant investment in the sales force virtually doubling our commercial footprint positions us for meaningful stronger productivity exiting 2026 and beyond. The revenue cadence will build meaningfully throughout the year as the realignment is completed. TriNav Advance has launched and the increasing productivity of the significantly expanded sales organization progress. Importantly, this cadence should not be interpreted as a change in underlying demand trends. We continue to see strong physician engagement, utilization and interest in the PEDD platform. The first half weighting is instead a function of timing, specifically the onboarding, training and territory development associated with our commercial expansion as well as the expected timing of new product contribution. We made a conscious decision to lean into these investments early in the year. deploying growth capital to expand our sales infrastructure and accelerate clinical and commercial initiatives affects near-term revenue phasing modestly, but it meaningfully enhances our growth trajectory exiting 2026 and positions us for sustained acceleration beyond our long-range plan. Now turning now to our commercial strategy. We've assembled a comprehensive PEDD portfolio that enables interventional radiologists to address virtually every vascular anatomy that they encounter. With a complete solution set, Physicians now can confidently standardize on PEDD across a broader range of cases, increasing utilization with existing accounts and accelerating adoption in new ones. At the beginning of 2025, we had 2 core commercial products. As we move into 2026, our portfolio will expand to 7 differentiated offerings across the embolization spectrum. This portfolio depth enhances the productivity of our sales organization by allowing each representative to drive more procedures per account, reduce selling complexity and position TriSalus as a single-source partner rather than a point solution provider to fully leverage this opportunity is why we're expanding our sales resources now and why we pursued the growth capital to increase our market coverage, improve our cell penetration and scale the commercial execution in a disciplined, high-return manner. Over the course of 2025, we launched TriNav LV, TriGuide and TriNav FLX, each addressing a particular vascular anatomy challenge that the interventional radiologist encounters. The TriNav FLX improves trackability and access to torturous anatomy. Tortures anatomy is commonly found in tougher to treat complex patients. During our fourth quarter, we launched the TriNav XP infusion system which was engineered specifically for compatibility with larger embolic particles, a more flexible distal tip for improved trackability in multiple linked and vessel sizes. These features were also important to use in low bar liver procedures, mapping our simulation procedures and for application in uterine artery embolization, market reception of TriNav XP thus far has been outstanding. The KOLs we surveyed highlight the exceptional trackability, enhanced visualization for precise targeting and improved procedural efficiency. As I mentioned, our next expansion of the TriNav product suite will be trying to have advance, which we anticipate launching in the first half of 2026. TriNav have Advance is an important addition to our embolization portfolio. This device is designed to facilitate selective therapy delivery to small distal vessels via a standard microcatheter, but still allow for PEDD to enhance therapeutic delivery to the tumor and protect against off-target delivery. The ability for an interventional radiologist to still use the microcatheter of their preference, but also benefit from improved delivery opens up a significant market opportunity for the use of PEDD. We are currently awaiting 510(k) clearance and plan to conduct a rapid market evaluation before fully launching in the second half of the year. With the launch of TriNav Advance, we'll have a complete portfolio of products that support all aspects of liver embolization procedures, which alone represents a total addressable market of approximately $480 million. Additionally, this portfolio of embolization devices supports embolization procedures in thyroid uterine artery embolization, genicular artery embolization or GAE, along with other embolization procedures, collectively representing USD 2.3 billion addressable market. The commercial adoption of the platform was bolstered earlier in 2025 by the introduction of the Centers for Medicare and Medicaid Services, CMS HCPCS code C8004. This code expanded coverage to include simulation or mapping procedures using TriNav, enabling interventional radiologists to utilize TriNav for other treatment planning and delivery using radio embolization. As a result, the reimbursable use of our technology within the radio embolization market has effectively doubled, supporting the broader adoption we are observing. Now interventional radiologists are able to use TriNav across a full spectrum of radio embolization care. Early feedback from key accounts and users highlights the clinical and economic advantages of the expanded reimbursement which we expect to continue driving adoption throughout 2026. In December, we hosted a second in a series of Key Opinion Leader event focused on our platform's potential and new clinical applications. The event featured Dr. Juan Camacho of Florida State University, discuss the unmet need in treatment landscape for multinodular goiter thyroid disease. In 2026, we intend to continue this program further to educate stakeholders on the advantages of the TriNav platform for our multiple indications. They're only continues in our PROTECT registry, a multicenter initiative, evaluating PEDD for patients with thyroid nodules or orders who are not candidates for surgery, radioidine or ablation. This study is designed to assess disease-related quality of life, thyroid function and outcomes following PEDD-based thyroid artery embolization. Preliminary results published in the Journal of the Endocrine Society were highly encouraging, showing 100% technical and clinical success, no neurovascular complications, mild and transient discomfort in 81% of patients all resolved within 2 weeks a 73% reduction in thyroid size and normalization of thyroid function and 71% of participants. These findings reinforce the promise of this minimally invasive alternative to thyroidectomy. In 2025, we also initiated a pilot registry in GAE. This is an emerging field, which offers a novel minimally invasive approach to pain management and mobility preservation for patients with knee osteoarthritis. GAE has the potential to delay or avoid total knee arthroplasty in select patients. In parallel, we're preparing to launch a clinical trial registry evaluating GAE as a treatment option for knee osteoarthritis, a condition affecting more than 30 million adults in the United States. This study aims to determine whether GAE can effectively reduce pain and delay the need for knee replacement surgery. Now turning to our nelitolimod program. Last year, we communicated our intention to release updated clinical data in the fourth quarter of 2025. We did not meet that time line, and I want to address that directly. As the PERIO-03 study progressed towards completion, it became clear that the most responsible and strategically valuable approach would be to consolidate data across all 3 PERIO Phase I studies into a comprehensive update rather than releasing partial data sets sequentially. In addition, we evaluated the potential inclusion of emerging data from an ongoing investigator-initiated study to provide a more complete view of the program's clinical potential. Final database lock and report preparation for PERIO-03 tend to beyond our original expectations, and as a result, we elected to delay disclosure to ensure that data package is thorough, internally validated and passioned appropriately for potential partners. We now anticipate releasing a consolidated clinical update in the second half of 2026. Importantly, this timing shift is not driven by safety concerns, efficacy signals or changes in our strategic priorities. All 3 PERIO Phase I dose escalation studies are complete. Enrollment in PERIO-03 has concluded and clinical study reports are in preparation. The decision to delay reflects our commitment to presenting a complete and cohesive data set that we believe will better support partnership discussions and maximize long-term value. As previously discussed, we have substantially reduced internal development spending related to nelitolimod following study completion. This allows us to preserve the program's optionality while maintaining capital discipline and focusing our resources on the near-term growth opportunities within our PEDD platform. We continue to advance partnership discussions and to support ongoing investigator-initiated studies. Before turning the call over to David, for a review of our financial results, I want to reiterate that TriSalus remains focused on executing on our near-term milestones, including achieving our 2026 annual revenue in the range of $60 million to $62 million, with growth weighted towards the second half of the year, launching TriNav Advance in the first half of 2026, publishing HEOR data on trip use in complex liver patients, delivering differentiated clinical data across the liver, UAE, TAE and GAE indications. As we look ahead to the balance of 2026, our strategy is fully funded, we're executing on our commitments of the recently raised growth capital and are confident in the commercial opportunities before us. We believe TriSalus-PEDD technology represents a transformative opportunity with substantial long-term value across a wide range of solid tumors and interventional treatment approaches. With that, I'll turn the call over to David.

Thank you, Mary, and good afternoon, everyone. As Mary mentioned earlier, our results for both the fourth quarter and 2025 fiscal year were strong. Turning first to our results for the quarter. revenue was $13.2 million, representing a 60% year-over-year increase over the $8.3 million recorded in the prior period. Gross margin for the quarter was 87% and compared to 85% in the prior year period. The increase in gross margin for the quarter was driven by improving manufacturing efficiency associated with our newly launched products. Research and development expenses were $2.6 million compared to approximately $3 million in the fourth quarter of 2024. The decrease was largely attributable to the completion of the enrollment and closure of our PERIO clinical studies for nelitolimod, as Mary alluded to earlier. Sales and marketing expenses were approximately $8 million compared to $7 million in the prior year period. The increase was primarily due the higher performance-based compensation, reflecting our strong commercial execution. General and administrative expenses were $4.2 million, down from $4.6 million in the prior year period. The reduction is primarily due to improving operational efficiency and tighter cost discipline related to corporate overhead. Net operating loss for the quarter was $3.3 million compared to $7.6 million in the prior year period. The decrease was primarily driven by increases in revenue and margin contribution for the quarter. Adjusted EBITDA loss for the quarter was approximately $950,000, an improvement versus adjusted EBITDA loss of $5.7 million in the prior year period. Turning to the results for the full year. revenue all from the TriNav system was $45 million for the year ended December 31, 2025, an increase of 53% compared to the same period in 2024. We revenue growth was primarily driven by increased TriNav units sold within liver-directed therapies. Gross profit increased by $12.9 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024, while gross margin decreased from 86% and to 85% year-over-year. The increase in gross profit was primarily driven by the increase in TriNav units sold while the year-over-year decline in gross margin was primarily driven by lower manufacturing efficiencies associated with our newly launched product throughout the second and third quarters, a dynamic in which we improved in the fourth quarter. Research and development expenses decreased by $2.7 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024. The decrease was primarily due to the closeout of clinical trial expenses related to nelitolimod. Sales and marketing expenses increased by $2.9 million for the year ended December 31, 2025. The as compared to the year ended December 31, 2024. The increase was primarily due to an increase in performance-related compensation, driven by the increase in sales during the year ended December 31, 2025, compared to the prior year period. General and administrative expenses increased by $3.5 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024. The increase was primarily due to a onetime charge during the third quarter relating to $1.6 million of accelerated noncash stock-based compensation vesting along with the revision of approximately $700,000 of certain patent related expenses from R&D to general and administrative expenses. Operating losses were $26.9 million compared to operating losses of $36.2 million for the same period in the prior year. The decrease was primarily driven by the increase in revenue, and strong margin contribution, highlighting our strong operating leverage. The basic and diluted loss per share was $1.84 compared to $1.31 for the same period in 2024. We increase was primarily due to the conversion of preferred stock to common stock. As of December 31, 2025, cash and cash equivalents totaled $20.4 million. As previously discussed, in February, we raised $46 million in gross proceeds via a public offering we concluded with fundamental health care investors. With that, operator, we are ready to open the line for questions.

[Operator Instructions] And our first question will come from the line of Frank Takkinen with Lake Street Capital Markets.

Great. Congrats on finish to the year. I was hoping to start with one on kind of components to growth in 2026. More specifically, how should we think about kind of contribution from liver versus non-liver, Obviously, liver has been the primary growth driver up until recently, and there's obviously a lot of exciting developments occurring in some of the non-liver areas. So curious if you could kind of talk through how much growth contribution could come from some of the non-liver areas? And then as an extension to that, just talk through maybe some of the clinical development you're going to pursue in some of the non-liver areas.

Sure. Frank, are you good to hear everybody. So this year, in 2026, it will still be the majority of our top line revenue will be associated with liver. But we hope to, in the second half, see some meaningful progress on the new applications, and that's really tied to data release. As you know, we have in thyroid, we have over 10 clinical sites that are enrolling patients, and we'll have some data released in the second half. We'll have data releases beginning at SIR around uterine fibroid and then data releases on both other new applications in the latter part of the year. So that's when we'll start to see some uptake in those indications.

Got it. That's helpful. And then for my second one, I was hoping to talk a little bit more about EBITDA. A lot of progress made to get the EBITDA that you produced in Q4. Obviously, a lot of exciting things to invest in and new capital on the balance sheet. How should we balance kind of your growth cadence in that EBITDA pathway as you build the foundation for growth.

Thanks, Frank. This is David. I'll take that one. At this time, we're not providing specific timing or guidance and cash flow breakeven our adjusted EBITDA breakeven as we're just at the early stages of investing in our commercial expansion. We're very focused and excited about the investments that we're making because they're intended to really position us to scale the company in a very meaningful way. And so we're very focused on investing to fit the organization for procedural volume. We anticipate essentially providing more visibility later in the year. It's just a little early for us to give that guidance right now.

And that will come from the line of John Young with Canaccord.

Mary. I wanted to start first on the strategy set with the increased financial flexibility. You spoke a lot about the accelerated investment in the commercial footprint. Just more color details there might be helpful. What will the sales organization structure look like after these investments would round -- I heard you say doubling of reps. So would 120 reps be right exiting 2026. And maybe some color on have they all been hired and when and perhaps are you doing like a junior rep, or a senior rep pairing or anything like that would be helpful.

Sure. Tom, it's good to hear you place as well. We're not providing any details on the numbers of reps and clinicians right now, but we are meaningfully doubling the size of the commercial organization and that includes adding a layer of management in just because what was happening with our sales organization, just the ratio of repo manager is getting too high. And that was limiting our opportunities. So we added in a layer of management. We also have expanded into significant more coverage, geographic coverage and we also targeted areas where we really believe some of the new applications are going to add substantial growth. So this is a pretty significant organizational upgrade and change across the organization. I think it's going to meaningfully drive acceleration in sales at the beginning in the second half of the year and forward. And your concept of kind of a junior rep, senior reps, what we found that rely has worked for us is, we have this peering of a clinical specialist with a representative. And what that allows us to do is if a rep pursues a new account and they garner position you as interest, the rep will begin to work with the physician and then the clinical specialist will come in and work in the case with the physician until we get comfortable and we can do it independently. So -- and many of those clinical specialists have become reps. So I guess, in a way, it could be kind of a junior senior rep. But we feel that type of approach allows us to have a lot of depth clinically with the representative. And maybe I'd even have Dr. Marshak talk about that because he's been pretty instrumental with us in terms of how do we define the right architecture for our product. Now that we have a new portfolio the expertise of the rep and the clinical specialist is going to be quite deep in terms of helping the physicians choose the right product for whatever type of vascular situation in that physician may encounter. So Dr. Marshak, do you want to jump in and provide some color on that? I don't know if we can hear you, Dr. Marshall. You're still on mute. Dr. Marshak, you're still unused. So I apologize, he was on and then all of a sudden, he's gone. But he's been very instrumental in helping us design this. The portfolio that we have it's quite broad, and it allows us to address virtually every situation. And that's why we feel like the clinical specialists and the rep is a better model for us right now.

Great. And then, David, maybe for the 2026 guidance, it sounds like most of this is predicated on continued use in liver, how much mapping growth is factored into that guidance as you annualize this either the code being rolled out, do you still expect continued mapping growth? And just maybe just walk us through that.

Yes. No, thank you, and great question. And I thank you again for your help with us achieving a mapping and simulation code yet again. As we look at it, we think XP can make a meaningful impact on our mapping. The larger new interior diameter is going to be extremely helpful. And then with that, we think we can meaningfully bring up growth within XP as well. And then with Advance, which is still pending FDA clearance, we think that could be even more meaningful from an imaging and mapping perspective as well. And so not only we're confident we can grow it just with some studies that will be releasing concorded studies in the first part of the year, but XP in advance will also make a meaningful impact in the growth there as well.

Yes, John, one of the things that we found with Advance and as you know, this is where physicians still gets the benefit of pressure enabled drug delivery, but they can use their own microcatheter. Some of the feedback that we've heard from physicians is it actually allows them to even be more trackable. And the way that we've designed the technology, the visualization is just the per. So we think the thing have advance is going to meaningfully help us in mapping because this is where they really want to interrogate the vascular structure and make sure they don't have any feeder vessels, and they really want to get a lot of clarity around what they're encountering and what they want to deliver the dose on. So between those 2 products as well as TriNav, we now feel once we get advanced EFT cleared, we'll have a portfolio that can penetrate mapping in a very meaningful way.

Mary, it's Dr. Marshall. I'd like to add that the -- TriNav Advance is going to allow us to capture cases that were previously capturable with TriNav because we can get into much smaller arteries, those are cases that we're going to be able to add to our portfolio that weren't there in 2025.

[Operator Instructions] One moment for our next question. That will come from the line of Justin Walsh with Jones Trading.

Can you provide any commentary on use patterns for your TriNav product portfolio? Just wondering if you see the same positions and accounts wanting access to the full portfolio to allow clinical flexibility or if some users focus on their favorite TriNav product and don't necessarily order the others?

Yes. Dr. Marshall, do you want to jump in and then I'll comment after you. It's [indiscernible].

It is. One trend that we have seen is when users get their hands on our finance Flex, which is a much more flexible tip that has enhanced trackability meaning we can get it into smaller arteries, easier or around turns easier. We've seen a trend where some or some users say, "I want that for every case. And then we still have other sites where they like the different opportunities with different catheters. So yes, it's varied.

Got it. And maybe one follow-up. You talked a little bit about the kind of expectations on non-liver growth in the near term. I'm just wondering what your thoughts are on kind of the medium long-term opportunities for TriNav in liver versus non-liver if you think it will be more challenging to grow some of these uses than others? And just some thoughts on that longer-term picture.

Yes. So the liver still is going to be a very significant component of our sales for next year and throughout the long-range plan. today, we ran roughly about 10% share. So we have enormous opportunity to penetrate that. And one of the things that we talked about in my opening comments was that we have physicians come to us in the latter part of last year. And this was really one of the reasons why they pushed us and why we went to go pursue the growth capital is we had leading KOLs come to us and say, now it's the time for you to really do those foundational studies to prove the superiority of your technology versus the microcatheter. So we're going to be doing foundational studies in the liver, both with TheraSphere and the SIR tech product to prove how our technology and liver embolization is superior. And we think that's going to be a very important driver of long-term liver penetration. Now in regard to the new applications, each one is a little bit different. So it's hard to put them out collectively. But I think it's going to be driven by the data. This year, you're going to see more publications on the thyroid. I mean this is a thyroid embolization. This is an opportunity that we think just makes sense for the patient in many dimensions. It's an easier procedure for the patient. It preserves fibroid function. It prevents them when we have in taking long-term thyroid medications. It's less costly. So depending on the value proposition, each of these are very significant opportunities that we want to pursue. And I think one of the things that we're starting to see, and I'll let Marshak talk about it is, if the physician begins to use the technology in the liver, we do see them starting to use the technology for other applications. In fact, that's where all these new applications came from. These were physicians who used our product, innovated it in a different procedure and then team to us to collaborate with us on how to develop that further. So Dr. Marshak do you want to make any further comments on that?

No, I think that captured it. The one thing I'll add is there is a lot of excitement around thyroid at realization. There continues to be. And this is a market that we're building. It's an unmet need for a lot of patients who don't have other options. So I do see that right now, that's a growth that's potentially exploding in 2026. Uterine realization is something that our XP is designed for. That's a market that already exists, and we're seeing adoption with that. And I think that's going to continue to grow.

I'm showing no further questions in the queue at this time. I would now like to turn the call back over to Mary Szela for any closing remarks.

Well, just thank you again. Thank you for the phenomenal questions and all the interest in trials appliances I really appreciate it. Thank you.