Good afternoon. My name is Kevin, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Paysign, Inc.'s Third Quarter 2024 Earnings Conference Call. The comments on today's call regarding Paysign's financial results will be on a GAAP basis unless otherwise noted. Paysign's earnings release will be disseminated to the SEC earlier today and can be found on the Investor Relations section of our website, paysign.com, which includes reconciliations of non-GAAP measures to GAAP reported amounts. Additionally, as set forth in more detail in our earnings release, I'd like to remind everyone that today's call will include forward-looking statements regarding Paysign's future performance. Actual performance could differ materially from these forward-looking statements. Information about the factors that could affect future performance are summarized at the end of Paysign's earnings release and in our recent SEC filings. Lastly, a replay of this call will be available until February 5, 2025. Please see Paysign's third quarter earnings call announcement for details on how to access the replay. It's now my pleasure to turn the call over to Mr. Mark Newcomer, CEO. Please go ahead.

Thank you, Kevin. Good afternoon, everyone, and welcome to Paysign's third quarter earnings call. I'm Mark Newcomer, President and CEO of Paysign. Joining me today is Jeff Baker, our Chief Financial Officer. Later during our Q&A session, we will also be joined by Matt Turner, our President of Patient Affordability; and Matt Lanford, our Chief Payments Officer. Today, we announced our financial results for the third quarter of 2024, and I'm pleased to report that Paysign has demonstrated meaningful growth in both revenue and profitability consecutively and year-over-year. Revenue for the third quarter was $15.3 million, an increase of 23% compared to the same period in 2023 and a 6.5% increase from the prior quarter. Our adjusted EBITDA rose 20.6% to $2.8 million or $0.05 per fully diluted share, up from $2.4 million or $0.04 per fully diluted share a year earlier. Gross margins also improved significantly, increasing by 440 basis points to 55.5% compared to 51.1% in the same period last year, driven largely by the expansion of our patient affordability business. Revenue from our patient affordability business grew by an impressive 219% year-over-year, reaching $3.3 million in the third quarter, up from roughly $1 million in the same quarter last year. Claims processed rose by 430% compared to the same period last year. This marks the fourth consecutive quarter of triple-digit year-over-year revenue growth for patient affordability, which continues to be a major contributor to our overall success. We finished the quarter with 66 patient affordability programs, with additional launches continuing throughout the remainder of the year. We are encouraged by the trend of existing clients bringing additional programs to us, which not only shortens the sales cycle but also reduces the program acquisition cost while creating immediate revenue opportunities as many of these additional programs are transition programs. In the fourth quarter, we expect to onboard several programs from both new and existing clients, including a new cornerstone account, one of the world's largest pharmaceutical companies. Our forward momentum positions us well for continued growth throughout the remainder of this year and well into 2025. Our pipeline remains strong with a mix of pharmacy-based retail specialty and medical benefits programs, highlighting our strategy to diversify revenue streams. Our current program composition is weighted towards specialty drugs with an emphasis on oncolytics. Programs launched in the third quarter of this year gave us additional claim volume in the retail space, something we believe will drive further growth as we pursue new opportunities in this market. Our plasma donor compensation business faced some challenges this quarter with hurricanes and staffing shortages affecting operations in our client centers. Despite these headwinds, revenue grew to $11.4 million, representing a 3.4% increase year-over-year and a 1.5% increase from the second quarter. We did experience a slight decrease in revenue per center to $7,991 this quarter versus $8,041 last year relating to these factors. We added 1 plasma center during the quarter, bringing our total to 478 centers, and we plan to add another 2 centers by the end of the year as new center openings remain muted. While growth in the plasma business has been tempered by external forces outside of our control, we remain committed to enhancing the productivity and efficiency of our services to the centers. Overall, we are pleased with our performance in the third quarter, which was driven primarily by outstanding growth in our patient affordability business. This segment is on its way to becoming our primary revenue driver. We believe the investments we are making in this area will yield substantial long-term growth and create significant shareholder value. Our commitment to developing innovative fintech solutions that address key challenges in health care payments, particularly patient affordability, remains strong. We are confident that, combined with our ongoing initiatives in plasma compensation and new opportunities in the evolving payments landscape, we are well positioned to deliver sustainable long-term value for our shareholders. I want to extend my gratitude to each member of the Paysign team for their relentless dedication and hard work. It is your commitment that drives our success. I will now pass the call over to Jeff, who will provide further details on our financial performance for the quarter.

Thank you, Mark. Good afternoon, everyone. As Mark said, we executed on another good quarter. Plasma donor compensation revenue increased $378,000 versus the same period last year or 3.4% to $11.44 million. This was primarily driven by increases in the number of plasma centers, 478 versus 462 and, to a lesser extent, modest increases in gross dollar cards loads of 1.8% and gross spend volume of 0.4%. This was offset by a modest decline in the average load amounts. Net-net, the year-over-year average monthly revenue per plasma center declined slightly to $7,991 versus $8,041. As Mark mentioned, our centers experienced reduced availability related to weather and staffing shortages, and we expect these same issues to have an impact on the growth of our Q4 plasma donor compensation revenue. Free cash flow from this business remains strong, which is helping to support the rapid growth in our pharma patient affordability business. Pharma patient affordability revenue increased $2.25 million or 219% to $3.27 million, primarily driven by the addition of 32 net new pharma patient affordability programs launched over the past 12 months. Pharma patient affordability revenue equated to 21.5% of total revenue during the quarter versus 8.3% during the same period last year. We exited the quarter with 66 active pharma patient affordability programs, an increase of 23 programs since the end of 2023. Other revenue increased $230,000 or 73.5% to $542,000 due to the growth in our payroll, retail, and other corporate incentive businesses. We continue to look for ways to improve the profitability of this other revenue stream, which lacks the scale of our other businesses and experiences higher fraud costs as a percentage of revenue. As in previous calls, with all the details we provided in the press release and that will be available in our 10-Q filing tomorrow morning, I will simply hit the financial highlights for the third quarter of 2024 versus the same period last year. Third quarter 2024 total revenues of $15.3 million increased $2.9 million or 23% versus the same period last year. Gross profit margin for the quarter was 55.5% versus 51.1% during the same period last year, an improvement of 440 basis points. SG&A for the quarter increased 32.4% to $6.2 million with total operating expenses increasing 35.6% to $7.8 million. $520,000 of the operating expense increase was related to higher depreciation and amortization costs. We continue to make significant investments in both IT and personnel to support the continued growth of our businesses, especially our patient affordability business. We exited this quarter with 164 employees versus 112 during the same period last year. For the quarter, we posted a net income of $1.4 million or $0.03 per fully diluted share versus net income of $1.1 million or $0.02 per fully diluted share for the same period last year. We recorded a tax expense of $54,000 during the quarter for an effective tax rate of 3.6%. The third quarter adjusted EBITDA, which is a non-GAAP measure that adds back stock compensation to EBITDA, was $2.8 million or $0.05 per diluted share versus $2.3 million or $0.04 per diluted share for the same period last year. This equates to a 20.6% year-over-year growth in our adjusted EBITDA. The fully diluted share count for the quarters used in calculating the per share amount was 56.1 million shares and 53.5 million shares, respectively, which reflects additional in-the-money options that were previously out-of-the-money. The adjusted EBITDA margin declined slightly to 18.5% versus 18.9% during the same period last year due to investments being made to support our patient affordability business. Regarding the health of our company, we exited the quarter with $10.3 million in unrestricted cash and no debt despite the use of $360,000 during the quarter to repurchase shares. This was equal to the adjusted unrestricted cash balance of $10.3 million at the end of 2023 and an increase of $1.7 million from the adjusted unrestricted cash balance of $8.8 million at the end of Q2 2024. The adjusted amounts take out the impact of accounts receivable, accounts payable, and cash collections related to pass-through invoicing of our patient affordability business. The changes in these balances do not equate to the revenue per claim we charge the pharmaceutical companies for paying such claim amounts. We expect that as the business grows, so will fluctuations in AR, AP, and unrestricted cash. Restricted cash increased $7.9 million to $100.3 million from December 31, 2023, primarily due to increases in customer deposits for our plasma and pharma customers of $8.5 million, offset by a decrease in funds on card of $556,000. Restricted cash are funds used for customer card funding and pharmaceutical claims with the corresponding offset under current liabilities. We repurchased 100,000 shares of our common stock in a private purchase at an average cost per share of $3.60. At the end of the quarter, $3.5 million remained outstanding under our share repurchase program. Now turning your attention to our guidance for the remainder of the year, we continue to expect total revenues to be in the range of $56.5 million to $58.5 million, reflecting year-over-year growth of 20% to 24%. Full year gross profit margins are still expected to be between 54% and 55%, reflecting increased revenue contribution from our pharma patient affordability business. Operating expenses are still expected to be between $30 million and $32 million as we continue to make investments in people and technology to support the growth of our business. Of this amount, depreciation and amortization is expected to be approximately $6 million, while stock-based compensation is expected to be approximately $2.6 million. As disclosed in the legal section of our 10-Q and in our 8-K released earlier today, we expect to have one-time legal expenses during the fourth quarter related to the settlement of our class action and derivative lawsuits. This expense was not anticipated at the time we provided financial guidance, but we still anticipate our operating expenses to be within the previous guided ranges. Given the continued increases in our average daily balances of unrestricted and restricted cash and the current interest rate environment, we expect interest income of approximately $3.1 million. We expect full year tax rate to be between 19% and 19.5% and our fully diluted share count outstanding to be between 55.5 million and 56 million. Taking all of the factors above into consideration, we expect net income to be in the range of $3 million to $3.5 million or approximately $0.06 per diluted share, and adjusted EBITDA to be in the range of $9 million to $10 million, which is 15% to 17% of total revenues or $0.16 to $0.18 per diluted share.

Could you provide more details about the additional pharmaceutical campaigns that were added during the quarter? I would also like to hear more about your comments regarding certain types of pharmaceutical campaigns, particularly the significant campaign from one of the largest drug manufacturers. I didn't catch all the details, and I would appreciate any extra information on where you are finding success and your plans moving forward with these patient assistance programs.

This is Matt Turner. Let’s start with the cornerstone account. Currently, we have three or four accounts that we consider cornerstone or strategic. These accounts usually consist of larger manufacturers with diverse product portfolios across various therapeutic classes. They may offer specialty drugs, which usually come from specialty pharmacies and are typically high-cost, often priced at $10,000 or more. They also provide retail products through traditional brick-and-mortar stores, and many have hybrid programs that operate under the medical insurance side rather than the pharmacy side, similar to what we used to call buy-and-bill. We have finalized a contract with one of these accounts and will initiate programs for them in this quarter of the year. Could you please repeat your question about the new programs we've launched? I didn't quite catch what you were asking.

Sure. I'm just trying to get a better feel as you grow the total number of campaigns or programs. Are we getting closer to being able to have kind of an average revenue per program or an average term? Or are we still seeing that the combination of these very, very expensive kind of in-office treatments versus retail, it just makes it so that an average is just not really that relevant?

Yes. An average, it's not relevant here. And it also depends on the types of claims that we're running as to the revenue per claim, things like that. So you may have one program that's going to run 30,000, 40,000, 50,000 claims a month, and you could have another program that's going to run 2 if it's in a rare disease state. So obviously, those aren't priced exactly the same. So there's not really a place to put an average to where it would make sense to really say, 'Hey, every program you're going to bring on now is going to effectively add X thousands of dollars a month.' There's obviously some kind of minimums that are in there around some administrative fees and things like that. But when you get into the transactional area, there's no real way to average that out.

Got it, okay. And then last question and I'll get back in the queue. But just based upon the really strong growth that you've seen in pharma year-to-date, and I'm sure you have some decent visibility to the fourth quarter, I guess, is there any type of color or early color you can give us, preliminary color on how you think this segment might grow in 2025?

If you're looking for a specific number, I will have to pass that question to Jeff for the guidance. I can confidently say that we have a very strong pipeline. The key accounts we currently have, along with the new one we just added, really enhance our capabilities for what we refer to as pharm inside. If you could see all our activities, you would notice one or two programs being introduced as a testing ground to ensure that our solutions function as promised. Once we start demonstrating cost savings or executing effectively, we could see more programs transitioning over. I believe we're going to witness increased business from our existing clients as we move into next year. This has contributed to some of the growth we've experienced this year, although it hasn't accounted for everything. Additionally, we've been selling for 2025 for the past two quarters as we prepare for FDA approvals and similar matters. So, I can say next year looks promising, and I will let Jeff address the financial figures if they come up.

Yes, Pete. So I mean, we obviously haven’t given any guidance. This year, it’s looking like for the full year, we still stand by that patient affordability is going to be about 20% of total revenues for the year. It was 21.5% for the quarter. Next year, that’s obviously going to increase. Whether that’s 25-ish percent or so, I think, is definitely doable. We do have a strong pipeline, like Matt just mentioned, but a lot of it comes into timing when some of these programs launch. Also keep in mind, as far as guidance goes, keep in mind, the first quarter is going to be strong for this business because of everything resets at 12/31 from a claims perspective. Some of these programs, the claims, because people reach their out-of-pocket maximums, they don’t get paid as you go through the remainder, as you get towards the second half of the year. So typically, this business will show stronger growth in the first and the second quarter if we weren’t going to add any more businesses throughout the rest of the year, which I don’t think that’s a very good assumption. But definitely you should see some pretty strong numbers in the first and second quarter, for sure. And we’ll get more – I’ll give more information as we get closer to giving guidance as we get through the first quarter and we have some more visibility on what programs exactly have launched as we go through the year.

Just a question on the plasma business, not really with the hurricanes as much. But what is going on with the staffing shortages? Is it just that the economy is so strong, they can't get people to work in these centers?

Yes, Gary, it's Mark. I wouldn't say that the reason we can't find people to work is solely because the economy is strong. There are many factors at play; as new centers have opened, they have drawn talent from their competitors, making it increasingly competitive to secure that labor.

Okay. And then switching over to the specialty business or the patient affordability business. Could you give us an idea of as you size the market, how big is it for the services that you provide?

Yes. I think the last call, we covered a little bit of this. I think our conservative estimate that we're looking at right now, we consider this TAM to be north of $0.5 billion. So again, we really have to work hard to piece together some numbers, but that's where we're pretty confident saying that we feel like this TAM is north of $500 million.

Is the current market situation allowing you to gain business through competitive advantages? Are you securing this business because various pharmaceutical companies are enrolling in your program due to the benefits it offers them?

There's a mix of what we're doing with transition programs. These products are already in the market, but the existing vendors may not be meeting the standards that pharmaceutical manufacturers expect or lack innovation. We have introduced some very innovative solutions in this area, where there hasn't been much advancement for almost a decade. In fact, we are significantly ahead of many competitors, despite their longer experience in the market. We are also handling both brand new products that are being launched for the first time and established ones. This diversification is driving our claim volume because the programs we are acquiring now provide a good mix of transition products, allowing us to benefit from patient acquisition already completed over the past few years. When we take on a program, we could start onboarding 15,000 claims right away rather than waiting two years to reach that number. Our sales team targets both new products and transition programs, which helps diversify our revenue streams. We know that some programs will have an immediate positive effect on revenue, while others will take longer to develop.

And then just once again, who are some of the other players in this space?

So we're pretty unique in the space in the fact that we only do patient affordability. There may be 1 or 2 other companies out there that are just doing patient affordability. But if you kind of look at the broader market of who else offers the services that we offer, you would see companies like ConnectiveRx, TrialCard, Eversana. Those are all, I think, private equity-backed companies. And then IQVIA and McKesson. McKesson has a subsidiary called CoverMyMeds. Both of those companies are publicly traded. But again, it's kind of important to mention that those people offer a breadth of services and to the marketplace appear like big box stores, whereas we offer expertise in one specific area of this, which is why we think we're being as effective as we are capturing this business.

Okay. And then lastly, Jeff, is there any reason we have to wait until the 10-Q is published to get what that legal expense was for the quarter or if that's going to hit in Q4? Or can you give it to us now?

Well, there's disclosure in the 10-Q that's coming out tomorrow morning on the settlement piece, which is, if memory serves me right, just over $600,000 if I recall. And that will be paid by our insurance company. They're still finalizing documentation and other things like that. So without saying too much, some of that cost is on us. It's six figures and that's about all I'm going to say about it right now.

Okay. So without these legal fees, it's safe to say we would have got a raise in the range of adjusted EBITDA for the year?

Well, I mean, the range we gave right now, Gary, I mean, the range we gave last quarter was we raised it to $9 million to $10 million. We still feel comfortable coming in that for the full year. Through this quarter, we’re in at $6.7 million so you kind of can extrapolate back from that. But we’ll still be in that range. There’s a couple of moving pieces but there will be an expense in there, that six figures that was not there when we gave this $9 million to $10 million.

I was curious if you could explain where you believe gross margins might be heading for the remainder of this year and into next, considering that patient affordability is becoming a larger part of the business.

For the year, we expect guidance in the range of 54% to 55%. We anticipate lower margins in the first half and higher margins in the second half due to the revenue coming from patient affordability. I believe we will see a sequential increase compared to this quarter. As the mix changes, we might be able to add 100 to 200 basis points in margin on a blended year-over-year basis. There are many variables at play, such as patient affordability, the timing of program launches, and developments in the plasma segment. We anticipate the fourth quarter will be influenced by factors like weather and employment conditions. Margins in the plasma business have increased both sequentially and year-over-year. We are focused on optimizing the operating performance of that business to generate cash for investment in other growth areas. However, that’s about all I can predict at this point.

Are you beginning to gain attention in the market due to your unique technology? Is that technology protected in some way, through patents, or is it more of a trade secret?

We have a couple of points to discuss. First, we've mentioned this before; one thing that sets us apart from our competitors is our open book pricing for customers. This industry has not historically been transparent about pricing, but we are very clear about it. Secondly, we possess some unique intellectual property that our competitors lack. While it isn’t patented, we are the only ones with access to this technology because we have incorporated it into our messaging, making it exclusive to us. Matt, do you have anything to add?

Yes. There are significant issues with processes and process patents. We considered patenting our work but decided it wasn't the best use of resources. Our team has collaborated to develop unique algorithms and approaches that others haven't discovered. That's where our appeal lies; we help our manufacturer clients save substantial amounts while dealing with challenges posed by insurance companies and PBMs.

And I’d say that – I’d also say the last thing is that we’re really the only company out there that you’re going to find is paying electronic claims via ACH or virtual debit card or paying claims via checks or – I mean, we’re a payments company, and that’s the value that we bring to our customers so we can pay those claims regardless, where historically, the industry has been mostly paper-based through check and other means.

Thank you, Kevin, and thank you all for joining today’s call. Your continued support and interest inspire us to transform health care payments and improve patient access to essential treatments. We look forward to sharing more updates in the coming quarters. Have a great day, everyone. Thank you.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.