TMCI - NASDAQ

Welcome to the Treace Medical Concepts Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Vivian Cervantes, Investor Relations, Gilmartin Group. Please go ahead.

Thank you. Good afternoon, everyone, and welcome to our fourth quarter 2024 earnings conference call. Participating from the company today will be John Treace, Chief Executive Officer; and Mark Hair, Chief Financial Officer. During the call, John will offer commentary on our commercial activities, followed by Mark for a review of our fourth quarter financial results released after market close today. We will host a question-and-answer session following our prepared remarks. Our press release can be found in the Investor Relations section of our website at investors.treace.com. This call is being recorded and will be archived in the Investors section of our website. Before we begin, we would like to remind you that it is our intent that all forward-looking statements made during today's call will be protected under the Private Securities Litigation Reform Act of 1995. Any statements that relate to expectations or predictions of future events and market trends as well as our estimated results or performance are forward-looking statements. All forward-looking statements are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. All forward-looking statements are based upon current available information and Treace Medical assumes no obligation to update these statements. Accordingly, you should not place undue reliance on these statements. Please refer to our SEC filings, including our Form 10-K for the full-year 2024 filed after market close today, and can be found in the Investor Relations section of our website at investors.treace.com for a detailed presentation of risks. With that, I now turn the call over to John.

Thank you, Vivian. Good afternoon, everyone, and thank you for joining us on our fourth quarter 2024 earnings conference call. We closed out 2024 and started 2025 on firm footing with a clear focus on executing on our agenda to comprehensively address the evolving needs of surgeons and patients with an expanding portfolio of innovative best-in-class bunion solutions. With our growing base of over 3,100 surgeon customers representing a ready audience for our growing suite of technologies delivered by our expert bunion-focused sales team, we aim to accelerate our penetration into the 450,000 bunion cases performed annually in the U.S. Since our inception, we've worked in close partnership with surgeons to understand and serve the large unmet needs in the bunion market. In fact, in 2018, our Surgeon Advisory Board published a peer-reviewed paper describing four different classes of bunion deformities, which included milder deformities, deformities that are more severe in nature, bunions with a coexisting deformity of the midfoot, and bunions with a coexisting arthritic great toe joint. When it comes to addressing bunions across a broad spectrum of bunion classes, our patented Lapiplasty system leads the way in both market position and innovation with over 120,000 patients treated since late 2015 and has become the dollar share leader in the U.S. bunion market today. This said, it's been our long-term strategy to expand our business by addressing all four of the bunion classes with a portfolio of innovative solutions, giving surgeons a broader spectrum of specialized options to address the needs of these patients. A key tenet of our product innovation strategy is to make our flagship procedures less invasive, which we believe translates to less pain and quicker recovery for the patient. And not only makes our procedures more attractive today, but we believe over time can extend our reach up-funnel and appeal to a larger portion of the 4.4 million Americans who seek medical attention for their bunions each year. Accordingly, we've innovated our flagship Lapiplasty instrumentation and implant technology three times now over the last several years reducing the required incision size by over two-thirds during that period. And today, Lapiplasty can be performed through a discrete 2-cm incision with our latest Micro-Lapiplasty option. Building on our strategy to serve all four bunion classes with disruptive specialized solutions, in late 2021, we introduced Adductoplasty, the first and only instrumented system empowering surgeons to reproducibly correct a class of bunions with a coexisting deformity of the midfoot known as metatarsus adductus. As a reminder, this sub-segment of patients is significant with this midfoot deformity present in up to 30% of bunion patients. And in our drive to deliver less invasive approaches, we recently introduced Mini-Adductoplasty, which allows the procedure to be performed through a 50% smaller incision leveraging our SpeedPlate implant technology. And for the milder class of bunions, while Lapiplasty is used by many of our surgeon customers as their go-to procedure of choice, there are many surgeons who prefer metatarsal osteotomies to treat most patients within this class. As a reminder, metatarsal osteotomies comprise an estimated 70% of the bunion surgical cases today. And for these surgeons, minimally invasive osteotomies represent the fastest-growing sub-segment. So, to broaden our procedure solutions and appeal to the preferences of these surgeons and their patients, we recently introduced two new and differentiated 3D osteotomy systems. For background, we estimate around 10% to 15% of all metatarsal osteotomies today are being performed with minimally invasive or MIS approaches and we believe that the biggest limiter to broader adoption of the MIS osteotomy is the technical difficulty and steep learning curve associated with conventional freehand techniques. For example, surgeons who teach these techniques talk about a 40- to 50-case learning curve to become proficient in doing them. We see this as a ripe opportunity for Treace to change the landscape and allow MIS osteotomies to be performed by a broader base of surgeons with control and confidence, effectively democratizing these once challenging operations, just as we've done and continue to do with our market-leading Lapiplasty and Adductoplasty procedures. Our approach to MIS osteotomies is consistent with our philosophy of anatomic three-plane bunion correction in order to achieve the most enduring patient outcomes possible, and offering user-friendly instrumentation designed to make these complex procedures controlled, reproducible, and faster for the surgeon. Our two new 3D MIS osteotomy offerings are both performed through very small cosmetically-appealing incisions, which we believe can result in less pain and quicker recovery for the patient. Our first system, Nanoplasty, offers a controlled instrumented three-plane procedure and, importantly, utilizes the familiar powered saw to cut the bone as opposed to a powered rotary cutting burr, which is used for most MIS osteotomies today and is known for a steep learning curve. For fixation, Nanoplasty utilizes a titanium intramedullary implant with locking screws to support early weightbearing and stability during healing. Our second MIS platform, Percuplasty, is designed to be the new standard for surgeons who already use a conventional approach to most MIS osteotomies. Namely, a less instrumented, essentially freehand procedure, using the powered cutting burr to cut the bone and two screws for fixation. As with Nanoplasty, Percuplasty delivers elegant instrumentation to deliver greater control, confidence, and consistency of results, allowing the surgeon to effectively dial-in the important three-plane correction that Treace pioneered and is known for. For fixation, Percuplasty uses two of our next-generation titanium screws to provide stability during healing. And we round out our comprehensive portfolio with a new and innovative solution for a sizable segment of bunion patients with a coexisting arthritic great toe or MTP joint. This class of bunions is treated at the toe joint itself, typically by fusing that joint. Targeting this patient segment, we recently introduced our SpeedMTP system in a limited market release. SpeedMTP combines our market-leading SpeedPlate compression fixation technology with additive locking screws to provide surgeons with a unique new option for MTP fusion surgery. This is an implant design that is extremely low profile and highly stable to support early weightbearing for these patients. And as the name indicates, it's also very fast for the surgeon to implant. As we stated in the past, we estimate that we have captured about 25% on average of our 3,100 plus surgeon customers' annual bunion procedures with our market-leading Lapiplasty solution. In offering these new specialized technologies, targeting preferences of our surgeon customers and patients across all four bunion classes, we believe we are dialed-in to maximize our share capture of the remaining 75% of their cases. We're experiencing very positive early responses on these four new technologies from both existing and new Treace surgeon customers. We expect to ramp availability of these new offerings progressively through the first half of the year with increasing revenue impact expected in the back half as we build our supply and train more surgeons. Turning to the quarter. Fourth quarter revenue was $68.7 million, representing 10.4% growth over the fourth quarter of 2023 and at the top-end of our previously-announced preliminary Q4 results of $68.4 million to $68.8 million. This growth was fueled by continued commercial execution and driven by product mix shift that resulted from increased adoption of newer technologies such as Adductoplasty and SpeedPlate, continued strong demand for our other complementary product offerings, increases in active surgeon users in the quarter, and some slight contribution from our limited market releases of Nanoplasty, MicroQuad SpeedPlate, Percuplasty as well as early surgeon access to our IntelliGuide PSI technology. We expect full inventory levels for these new products as we enter the back half of 2025. Turning now to reimbursement. As we previously announced, CMS significantly increased material reimbursement for CPT code 28297, the code predominantly associated with Lapidus fusion or Lapiplasty procedures in both the hospital outpatient and ASC settings effective January of this year. While certainly a positive development, it's still very early in the year and too early for us to assess the impact. We're monitoring our customer base and we'll update you on trends we see as we progress throughout the year. Turning to our financial outlook. We are initiating our full-year 2025 revenue guidance of $224 million to $230 million, which reflects an expected increase of 7% to 10% over 2024 revenue. For the full-year 2025, we expect break-even adjusted EBITDA. We feel good about our setup for 2025. While continuing to drive our market-leading Lapiplasty, Adductoplasty, and SpeedPlate offerings deeper into the market, our sales team is excited to deliver this broader portfolio of highly specialized technologies to our ready and captive audience of over 3,100 active surgeon customers. We believe our robust portfolio of best-in-class instrumented solutions targeting all four classes of bunions puts us in a unique and powerful position to extend our market leadership and execute our strategy to speed penetration in the overall bunion and related midfoot markets. Let me now turn the call over to Mark to review our financial performance. Mark?

Thank you, John. Good afternoon, everyone. Revenue in the fourth quarter was $68.7 million, an increase of $6.5 million and 10% over the prior year period. Growth was driven by a product mix shift, increased adoption of our newer technologies, and increase in bunion procedure kits sold and active surgeons. For the full-year 2024, revenue was $209.4 million, a 12% increase over 2023 and at the top-end of both our pre-announced revenue expectation of $209 million to $209.4 million and our prior 2024 revenue guidance range of $204 million to $211 million. Gross margin was 80.7% in the fourth quarter of 2024 compared to 81.6% in the fourth quarter of 2023. For the full-year 2024, gross margin was 80.4% compared to 81.2% in 2023. The change in gross margin was driven by a product mix shift to newer product innovations and an increase in inventory provisions, partially offset by lower royalty rates. Total operating expenses were $55.7 million in the fourth quarter of 2024 compared to $57.5 million in the fourth quarter of 2023. These reductions reflect continued execution on our expense management initiatives. For the full-year 2024, operating expenses were $224 million compared to $203.4 million in 2023. The increase in full-year operating expenses reflect increased stock-based compensation expense, investments in product innovation, and support for other corporate initiatives. Fourth quarter net loss was $0.5 million or $0.01 per share compared to a net loss of $6.3 million or $0.10 per share in the fourth quarter 2023. For the full-year 2024, net loss was $55.7 million or $0.90 per share compared to a net loss of $49.5 million or $0.81 per share in 2023. Adjusted EBITDA for the fourth quarter was $11.1 million compared to $2.6 million in the fourth quarter 2023, an improvement of 322%. For the full-year 2024, adjusted EBITDA loss was $11 million compared to a loss of $24.4 million in 2023, an annual improvement of 55%. Cash, cash equivalents, and marketable securities were $75.7 million as of December 31, 2024. Including access to an additional $26 million of cash through our existing revolver, the balance of cash, cash equivalents, and marketable securities will be approximately $102 million as of December 31, 2024. We believe our balance sheet strength and flexibility is sufficient to continue effectively executing on our strategic investments and growth initiatives for the foreseeable future. Before concluding, let me turn our outlook for full-year 2025. As John mentioned, we are initiating our full-year 2025 revenue guidance of $224 million to $230 million, which reflects an expected increase of 7% to 10% over 2024 revenue. In addition, we expect break-even adjusted EBITDA for full-year 2025 and expect our cash burn to decrease by approximately 50% for full-year 2025 versus 2024. With that, let me turn the call over to the operator to open the line for your questions.

[Operator Instructions] Our first question comes from Ryan

Good afternoon. Thanks for taking our questions. I want to start with guidance for a bit and talk about the cadence through the year. You have arguably your toughest comp in the first quarter and so, if you could kind of give us your thoughts about pacing through the year. Will revenue I’ll just ask it upfront be down in the first quarter 2025 just given the seasonality and then should we think it kind of accelerates linearly through the balance of the year? I'll start there.

Hi, Ryan, this is Mark. Thanks for the question. Yes - and first of all, let me just say that we're really pleased with the fourth quarter results, how our sales team grew our top-line and how R&D has provided a lot of newer technologies that we'll be able to benefit from in 2025. As far as cadence goes, you already hit it that Q1 - we've talked about that, that's going to be a tougher comp for us. And so, I think, we've had those conversations last call and we've been having those. And then post Q1, there's definitely more opportunity to have a higher growth rate. Now most of our story for this year, and John said it in his prepared remarks, it's more of a back half of a 2025 story. And so, we want to have some opportunity to get these new products into more of our customer surgeons' hands and then we feel like there's an opportunity to increase our growth in the back half of this year. But for now, we're not necessarily looking at it as a linear step-up each quarter, but as we get further into the year, we'll definitely give more updates on how these new products are being received by our customers. We're hearing great feedback already, but as we have a little bit more time, we'll be able to give a little bit more detail. But I think what you said is Q1 is a tough comp and then we'll definitely be able to grow at higher rates in Q2, Q3, and Q4.

Okay. Helpful. And then, when I think about the product pipeline for you, John, I mean, you talked about it, impacting in the second half of the year from a growth perspective, but underlying those comments, when we think about our model, we think about ASPs, we think about unit volumes, we think about, potentially the risk to Lapiplasty cannibalization. And so, I guess, what I'm looking for is maybe from a broad stroke perspective, how you think about those products impacting some of those underlying metrics and, is there downward pressure on ASPs? Is it offset by higher volume, your ability to train more surgeons because you have potentially more, product out there. Just help us kind of think through, some of those moving parts, I think that would be very helpful. Thank you for taking the questions.

Sure, sure. Thanks, Ryan. Good to talk to you. Yes. As we get out there with these products, and there are several, we are training surgeons comprehensively on these and these new training initiatives we have called BunionMasters events where surgeons are coming in. We had one a couple of weeks ago in Nashville, for instance, over 100 surgeons came to get trained, one of the best attended meetings I've seen in several years. The attractiveness of multiple technologies being serviced through our dedicated sales channel, now being able to address their minimally invasive osteotomy needs, their midfoot correction needs, their more severe bunion needs with Lapiplasty, and then, of course, Adductoplasty for, I'm sorry, I said Adductoplasty, but the arthritic MTP joints as well. We've got this comprehensive portfolio that I think is going to work in great harmony together to further penetrate this big opportunity ahead of us. From a pricing standpoint and a mix, I don't necessarily think there's going to be a big shift happening in blended ASP. I see more - this being more of a procedure volume play over the course of the year and, we got a little dusting of impact from these products right at the end of Q4. We'll get a little in Q1, but again, it's a big comp. As we get into Q2, we'll get a little more impact, three more impact and be in a great situation as we line up for Q4 bunion season. So, hope that gives you a perspective, but, there are natural kind of guardrails around cannibalization between our MIS osteotomy approaches and Lapiplasty being in most surgeons' minds relegated to the more severe end, moderate-to-severe and more concentrated there, where these MIS osteotomies are going to be targeting that more mild-to-moderate end of the spectrum where we're the least penetrated with Lapiplasty. So, again, I think everything is set-up really nicely. I think we're really excited to see the full impact that this comprehensive bunion solution portfolio can bring. Sales force is very excited, morale is very high. We got a sales meeting this weekend in Orlando and it's going to be a lot of fun. So, maybe a little more than you were looking for, but I gave you the whole story.

No, I appreciate it and looking forward to it. Thank you.

Thank you. One moment for our next question. Our next question comes from Lily Lozada from JPMorgan. Please go ahead.

Great. Thanks so much for taking the question. Maybe just to shift to profitability, that's obviously come into greater focus. So, could you talk through how you're thinking about the different components down the P&L, what's driving the leverage this year? And then, part two, how you're thinking about balancing that leverage with reinvigorated growth, especially with all these new products that you have coming to market that you'll have to invest behind?

Yes. Great question, Lily. And let me begin and maybe John can follow-up with it. We've talked a little bit about, when we went public, some of our initiatives and our focus areas, one of them was to grow a very large direct sales channel and direct sales team. And so, we've made a lot of progress in that area and so a lot of the leverage that we're seeing is, we are no longer aggressively building that team the way we had in prior years. And so, there is some very natural leverage that comes from a more experienced sales force. We have a much higher percentage of our sales force that's on pure commission, for example. And we're just not building as aggressively as we used to. So, we're going to see a lot of improvement in leverage that you'll see in the sales and marketing line, but that's going to be very natural and won't really impact our ability to grow. That's the benefit of where we are at this point in time. We've spent a lot of time building the sales channel and we've built a very large customer base, over 3,100 customers. And so, now, it doesn't have a lot of direct incremental costs to just now provide our sales force and our surgeon customers just more products. And so, it's a very natural progression. And so, that's why we know that we'll see --and believe that we'll see this improved leverage throughout the year. And so that's why - , we improved our adjusted EBITDA 50% in 2024 as compared to 2023 and so we're getting the remaining 50% this year in 2025.

Great. Thanks. Maybe just to follow-up. I know it's still early in the launch of some of these new products. But can you talk about some of the early feedback and competitive dynamics that you've seen since you've launched? And have you seen some of the docs that you may have lost to competitive trialing last year come back to either Lapiplasty or some of these new MIS osteotomy products? Thanks so much.

Sure. Sure. This is John. The early feedback we're hearing on these products is very positive. These have been worked on for several years. They're very refined as they're now, entering early surgeon users' hands and we're seeing those postoperative x-rays. We're seeing the bone healing and getting some numbers under our belts now. So, we're really confident that this is going to reinforce our position with our customer base and help us bring on new customers now that we have that more diversified and broad portfolio. As far as competition, we really haven't seen any real changes from earlier discussions. We saw the competitive noise that occurred during mid-2024 kind of abate or level out in the fourth quarter. We saw, in the fourth quarter, a lot of strength and a lot of surgeons that, dabbled with other competitive products during the summer months coming back to Lapiplasty in the busy fourth quarter. That's I think - hopefully that addressed your question.

Yes. That's perfect. Thank you.

Sure.

Thank you. One moment for our next question. Our next question comes from Kallum Titchmarsh from Morgan Stanley. Please go ahead.

Thanks guys for taking the question. Just one quick one from me. And it's something we've been asked quite a bit from clients. So, it was worth addressing on the call. But keen to hear any of your thoughts on the

Hi, Kallum, it's John. Thanks for the question. I really - we probably don't have a lot to comment on there, at this point. We've got our heads down, growing our product line, running our business, and we'll just have to see how the acquisition plays out and the effects on the market as those two companies formally join up.

For sure. Thanks.

Sure. Thanks.

Thank you. One moment for our next question. Our next question comes from Richard Newitter from Truist Securities. Please go ahead.

Hi, thanks for taking the questions. Maybe just to start-off with, just going back to one of the value propositions that I remember, initially was around Lapiplasty or a Lapidus fusion versus osteotomy was that the recurrence rates are lower and people were not getting the right procedure for the condition that they're trying to fix. I guess with your osteotomy solution product - I appreciate that it's probably easier and more elegant for surgeons, but do you think that the clinical outcomes over time are going to show that you're going to have better, recurrence rates versus traditional osteotomy products? I'm just trying to think about the actual clinical benefit to physicians and patients over time here versus, capitalizing on what physicians are going towards? I appreciate that, but is the clinical utility from your product differentiation going to bear out versus traditional products in the osteotomy segment? Thanks.

Hi, Rich, John. Yes, great question and one we've been answering a fair amount. The important thing about the way we're approaching our procedures is, we're fixing the third plane, the rotational plane along with the other two planes of the correction. And that's not something that's been focused on in osteotomies traditionally to a greater degree, particularly in the minimally invasive osteotomy segment. So, our core philosophy and what we pioneered and developed in the market and built into Lapiplasty was, a three-plane correction. So, we're taking the minimally invasive two-plane approach and making it a three-plane approach. We believe fixing that rotational plane makes the correction more enduring over the long term and there's good scientific papers in the clinical literature that indicate that as well. So, if not for that, if not for developing a three plane, what we believe can be a more enduring correction, we may not be in that game. But we believe we're the best equipped to do it and we've done it through some really, really well-developed instrumentation and now we've got the great ability of, world-renowned minimally invasive foot surgeons helping train surgeons as we roll these products out. So, that's the way we're approaching it.

Got it. Thanks. And then just as a follow-up. It looks like the consensus is - has about just under $53 million for the first quarter of '25. So does that seem like a reasonable place? It's a 5% year-over-year growth rate, which is down from your fourth quarter on a tougher comp. I just want to get your view on that. And then can, from just how the year plays out, should we be thinking of 4Q as like a 33%, 34% weighting of the year as a percentage of the total? Thanks.

Yes, Rich, this is Mark. Thanks for the question. So, what we've been talking about Q1 is, we've said, hey, it's probably going to be low-single digit growth rates year-over-year compared to Q1 of 2024. We had a really strong quarter last year in Q1. And so, we've been saying it's probably low-single digits. And then, we have the ability to expand and grow from there. So, it's going to be a tougher comp. And then, we feel like there's a real opportunity to be in the double-digits for most of, if not all the remaining quarters in the year. It's just we've got to get over this tough comp first. With respect to Q4, I think we're going to have somewhat similar growth rates in the fourth quarter and so it will be somewhere in that range that you talked about as far as its contribution for the full year. It might be a little bit stronger than what you said, but, I think we'll give a little bit more color as each quarter progresses here, and as these new products are getting to the hands of surgeons, we see the adoption rates there. But I think that's the way we see it. Q1 is the tough quarter and then we really see some improvement in every quarter after that.

Thank you.

[Operator Instructions] Our next question comes from Danielle Antalffy from UBS. Please go ahead.

Hi, good afternoon, guys. Thanks so much for taking the question. Congrats to a nice end to the year. John, I was hoping you could comment a little bit on - you alluded to potentially the osteotomy, the broader product offering, getting new surgeons to pick up your devices as a whole. And I wanted to see if there was a way to sort of frame that for us, like how many surgeons do you see as, opportunistic there and how quickly something like that could transpire? And then I have one follow-up.

Sure. Hi, Danielle. Thanks for the question. We talked about, adding roughly 200 new surgeons during the year to add to our base of surgeon users, we think that's, a reasonable target for this year. I think when we think about framing the side of the market that we're really targeting with these new technologies, we're going after the 70% portion of the 450,000 procedures. So, we think we have about, nearly a quarter of the Lapidus market segment today on a procedure penetration basis. So, we're very concentrated in the more moderate-to-severe end of that - of the total bunion market and we have pretty good market share there. Like I said, approaching 25%. So, if Lapidus is around 30% of the overall market, we're going to continue to drive penetration into that segment with Lapiplasty and Adductoplasty, and we're going to keep iterating and innovating those like we always have. But now we've got this additional opportunity to drive these new targeted technologies into the larger 70% of available procedures, which is a really big opportunity for us. And if we can get to 25% share of that larger volume segment of the market like we did with Lapiplasty and the Lapidus segment, that could amount to another $350 million of potential revenue that we're focused on building on over the next several years. So, we believe this comprehensive portfolio really targeting these four segments of the bunion classes is going to give us a lot more shots on goal in ramping our penetration into the overall market.

Got you. Okay. That's helpful. And then my follow-up question is, at a higher level, I guess, looking at the total foot and ankle, and I know you guys have a lot of run-way in bunions alone, but - and midfoot, for example, but - and I don't want you to, give anything away for the competition or anything like that, but maybe talk about how you guys look at the opportunities throughout the rest of the foot and ankle and what you think is reasonable over the next five years to attack there based on what you guys have in-house today from a technology perspective? Thanks so much.

Yes. Great one. I'll try to deliver on that as best I can. We've got a very active R&D program and we've been working on products for the last three years. We've got a robust pipeline of more product roll-outs coming from throughout this year beyond what we've advertised and we have programs leading into '26 and '27, that are going to continue to fuel the growth of the business. So, I think if you look at where we will look to innovate and what you'll see, you'll see types of products that speed penetration into our core bunion and midfoot markets, you'll see us targeting new incremental procedures that anchor back to that core procedure base. And then, we're also introducing new complementary technology or product platforms that allow our reps to more fully service the case with a more comprehensive line of products, so that they can become more of a one-stop shop for all the surgeons' needs in their bunion and bunion midfoot-related cases. That's how we look at it for at least the near to moderate term. Longer term, obviously, we have opportunities and we can explore other areas in the foot and ankle if needed. But we see such a tremendous opportunity just capitalizing on what I described there for the next several years that there's really not a ton of need to - , to really go elsewhere.

That's helpful. Thanks so much, guys.

Thank you.

Thank you. One moment for our next question. Our next question comes from Ben Haynor from Lake Street Capital Markets. Please go ahead.

Good afternoon, gentlemen. Thanks for taking the questions. First-off for me, can you give us a sense of the utilization that you see from the surgeons that have adopted your osteotomy offerings thus far? I know it's early days and all, but can you maybe characterize what those folks look like? Are they the ones that are doing 50% of their cases with Lapiplasty? Are they the ones that maybe are newer and have only dabbled in Lapiplasty? What does those folks look like? And what does their utilization of the osteotomy offerings look like?

Yes, Ben, pleased to meet you online here. This is John. As we rolled-out our new osteotomy systems, we developed them in conjunction with a modest group of surgeons that really specialize in minimally invasive osteotomies and minimally invasive osteotomy surgery. So, they tend to be very high utilizers of that technology. Some of them actually do use Lapiplasty to some degree in their practice, some more than others. As we've segmented our customer base, the earlier doctors that we've been giving access to our minimally invasive osteotomy products have been those that are on the lower end of utilization of Lapiplasty, so that we can fill a bigger void in that customer's practice. Over time, we'll continue to expand and, we believe we'll have a more balanced business, a blend of Lapiplasty for the more, moderate-to-severe range of the user basis bunions and our MIS osteotomy solutions and even our SpeedMTP for those that have great toe arthritis for the others.

Okay.

Hi, Ben, this is Mark. And one thing that John said, I just wanted to add a little bit to that is, there's - different surgeons have different criteria for how they treat bunions. And so, the way we've segmented the marketplace is, we were initially trying to go after those surgeons that do more of these minimally invasive osteotomy approaches. And - but there's - and John alluded to it earlier, there's kind of a natural guardrail too because a lot of these surgeons have predetermined severity distinctions as far as when certain technologies are used or certain approaches are used - are being used. But initially - to answer your question specifically, initially, we're going after those surgeons who primarily focus on osteotomies. And so, we hope to get a really large share of their current business.

Okay. Thanks for the color there. That makes a lot of sense. Kind of into my second question. how does the new kind of four classes of bunions, is the sub-segments messaging alter your direct-to-patient marketing activities? Does that change that at all? Is there any adjustments that need to be made there?

Yes, that's a great question. We have opportunities definitely now that we did not have before, we've been pretty concentrated on driving the Lapiplasty message, making patients aware, helping them get educated and connect with doctors on that front. But as these technologies gain more traction and we see the uptake, we definitely have the opportunity to take some different approaches there.

Okay. So, I'll stay tuned. And then if I could sneak in one more. Just any update on the attach rates for SpeedPlate and siblings, I think last time you talked about it was over 40%. Any update there?

Yes, sure. SpeedPlate continues to become more popular. It is now north of 50% of our overall fixation mix. And will it continue to grow and then become a much larger share? It has the opportunity to do so. We are working on new configurations of SpeedPlate for, next-generation implant designs and serving other opportunistic indications. We think it's setting a new standard in bone fusion fixation out there in the marketplace, and it's a really exciting technology for us. So...

Excellent. So that's all I have. Thanks so much for taking the questions.

Thanks, Ben.

Thank you, Ben.

Thank you. I'm showing no further questions at this time. I will now turn it back over to Vivian for closing remarks.

Thank you, operator. On behalf of Treace Medical, thank you, everybody, for joining us today. This concludes our call and we look forward to our next update following the close of the first quarter 2025.