Good morning, and welcome to TriSalus Life Sciences Third Quarter 2023 Earnings Conference Call. As a reminder, the call is being recorded for replay purposes. I would now like to turn the call over to host Jim Young, Senior Vice President of Investor Relations and Treasurer at TriSalus for a few introductory comments.

Thank you all for participating in today's call. Joining me today from TriSalus Life Sciences are Mary Szela, President and Chief Executive Officer; Sean Murphy, Chief Financial Officer; and Dr. Steven Katz, Chief Medical Officer. Earlier this morning, TriSalus released financial results for the quarter ended September 30, 2023, a copy of the 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 includes 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 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, reimbursement proposals, 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 section of our Form 10-Q 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, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of the live broadcast today, November 14, 2023. And with that, I'll turn the call over to Mary.

Good morning, everyone, and thank you for joining us today to review TriSalus Life Sciences third quarter results for 2023. This marks our first quarterly earnings call as a publicly traded company, and we're excited to report on our progress towards our mission to extend and improve the lives of people living with liver and pancreatic tumors. We greatly appreciate your presence today on the call. TriSalus was founded in 2018 to address the two main barriers that inhibit treatment success in liver and pancreas tumors via the combination of our proprietary technology that can deliver high concentrations of a range of therapeutics to the site of disease with a novel immunotherapeutic focused on attacking the immunosuppression environment and enabling checkpoint inhibitor response. Enter to moral hypertension is a pervasive and underappreciated problem that causes collapse of vessels in tumors, limiting blood flow and therapeutic uptake. Our Pressure Enabled Drug Delivery, PEDD technology has been shown to enable superior delivery of a broad range of therapeutics into tumors with improved accuracy, predictability and at higher tissue levels in association with better clinical outcomes. PEDD allows enhanced delivery to increase therapeutic delivery to the tumor while decreasing exposure in normal tissue to minimize toxicity and enable treatment of patients with more advanced disease. Our TriNav Infusion System which was launched in 2020, leverages our PEDD technology to overcome the infusion barriers that limit therapeutic uptake in solid tumors including pancreatic adenocarcinoma, hepatocellular carcinoma and liver metastases. TriNav has demonstrated the ability to deliver high concentrations of therapeutics into high-pressure tumors while limiting exposure to normal tissue, avoiding off-target toxicity. We believe this is game-changing, first-of-a-kind technology and the adoption by interventional radiologists we have achieved to date is a reflection of its patient impact and efficacy. Our TriNav business has grown at an annualized growth rate of approximately 50% despite facing challenges at the start of the pandemic. In the third quarter, we achieved our highest ever sales figure of $5.2 million. We're delighted to report that this business continues to demonstrate robust revenue and market share growth throughout the United States. Our strategic investments in physician education, clinical and sales personnel have enabled us to successfully educate the interventional radiology physician community and drive adoption. This business has single-digit market share and superior gross margin, which provides significant opportunity for future profitability. Following my remarks, Sean Murphy, our Chief Financial Officer, will provide a more in-depth analysis of our quarterly results and key operating metrics. In addition to our TriNav technology in 2020, we acquired SD-101, an investigational toll-like receptor 9 agonist. In clinical studies performed prior to the acquisition, SD-101 demonstrated the ability to favorably reprogram the tumor microenvironment and promote responses to immunotherapy. Later in the call, Dr. Steven Katz, our Chief Medical Officer; will share recent encouraging data from our Phase I PERIO-01 trial for uveal melanoma with liver metastases and our PERIO-03 trial for pancreatic adenocarcinoma. These results further validate our company's proof of concept, and the effectiveness of our Pressure-Enabled Drug Delivery combined with SD-101 in overcoming critical mechanical and biological barriers in the treatment of solid tumors. In summary, we're very encouraged by the remarkable progress our team has made in our commercial and clinical endeavors and are very excited about the future of TriSalus. At this time, I'm proud to introduce Sean Murphy, our Chief Financial Officer, to discuss our operating results and key financial metrics.

Good morning, everyone, and thank you, Mary. I'm pleased to announce that TriSalus achieved outstanding results in the third quarter that ended September 30, 2023. Our revenue solely driven by the success of the TriNav device reached $5.2 million. This sales achievement represents the highest quarterly sales in the company's history, reflecting a 32% increase compared to the same period in 2022. TriSalus has a growth record, as illustrated on Slide 1, which shows that the company has grown at a compound annualized growth rate of approximately 50% since the launch of our product in 2020. This segment of the business is approaching breakeven late in 2024. It is worth noting that the third quarter of 2022 was a particularly strong sales period, making this year's performance more remarkable. In terms of the year-to-date revenues as of September 30, 2023, we have reached $12.8 million, a 39% increase from the prior year. These results can be attributed to several factors, including the adoption of TriNav in new accounts, increased utilization of existing accounts and the continued expansion of our sales force, all of which has led to an increase in our market share. In the third quarter, we captured 15 new hospital accounts and 44 accounts year-to-date. Our account utilization reached 10 units per account, an increase of 2 units or a 25% increase over last year. Finally, we are increasing our sales team with the funding we received by going public. At the beginning of 2023, we started the year with 10 representatives, and by the end of the third quarter, we had reached 21. We expect to continue our sales force expansion during the balance of the year and into 2024. We are proud to report a robust gross margin profile of 88.7% in the third quarter of 2023 and an 84.2% gross margin year-to-date compared to 82.1% in the third quarter and 84.3% year-to-date in 2022. This favorable margin profile in 2023 can be attributed to increased factory volumes, improved batch yields and other operating efficiencies. We believe our facility in Westminster, Colorado has the capacity to support our growth over the next 5 years. In terms of our investment in research and development, expenses in the third quarter of 2023 totaled $9.4 million, an increase of 95% from the third quarter of 2022. Year-to-date R&D expenses amounted to $21.9 million, reflecting a 45% increase from the corresponding period in 2022. These investments are primarily related to the additional patient enrollments in our three PERIO clinical trials. Our dedication to growth is also evident in our sales and marketing expenses. In the third quarter of 2023, we invested a total of $4.7 million, a 55% increase from the third quarter of 2022. Year-to-date sales and marketing expenses reached $11.4 million, marking a 29% increase from 2022. These investments are closely tied to the ongoing sales force expansion. Moreover, general and administrative expenses for the third quarter of 2023 totaled $9 million, representing a substantial increase of over 150% compared to the third quarter of 2022. Year-to-date, general and administrative expenses amounted to slightly over 100% more than in 2022 at $17.5 million. These increased costs include one-time costs of $4.8 million in the third quarter and $7.7 million year-to-date related to the completion of our leaseback process in August of 2023. Our operating losses for the third quarter of 2023 totaled $18.5 million compared to losses of $8.1 million in the third quarter of 2022. Year-to-date losses in 2023 amounted to $40 million compared to losses of $24.7 million in 2022. The increased losses in 2023 can be attributed to higher operating expenses in research and development, sales and marketing, and general and administrative expenses, as mentioned earlier. These increased expenses were partially offset by the increased gross margin resulting from increased TriNav revenues and an improved gross margin profile. We believe that operating earnings provide the most accurate insight into our ongoing profitability. This figure closely aligns with EBITDA and excludes noncash valuation adjustments related to equity issuance, fair value adjustments of the tranche and warrant liabilities and the fair value adjustments of contingent earn-out liabilities. It is important to note that these noncash valuation adjustments may continue to produce material fluctuations in our net earnings, resulting during the next several years. In terms of net loss attributable to common stockholders, we reported a loss of $1.7 million in the third quarter of 2023 and $27 million year-to-date compared to a loss of $8.1 million in the third quarter of 2022 and $24.6 million year-to-date. These results are significantly influenced by noncash gains and losses on the valuation of contingent earn-out liabilities, tranche and warrant liabilities, and equity issuance. In conclusion, we remain dedicated to our mission and excited about our future. With this, I will pass the call to Dr. Steven Katz, our Chief Medical Officer, who will provide further highlights about our PERIO clinical programs.

Good morning, everybody, and thank you, Sean. We appreciate your interest in learning more about the progress the company is making on behalf of patients with liver and pancreas cancer. While immunotherapy has undeniably yielded transformative results in several solid tumor indications, patients continue to confront unmet medical needs with primary liver cancer, liver metastasis, and pancreatic adenocarcinoma. As Mary noted earlier, our TriSalus approach harnesses the power of PEDD to overcome mechanical tumor microenvironment barriers. We combined our PEDD technology with SD-101, a carefully selected drug capable of addressing the biological and immunosuppression-related challenges in these organs. Importantly, we believe the mechanical and biological barriers that our trials seek to address are prevalent across multiple cancer types. SD-101 broadly stimulates the immune system and acts to eliminate a specific cell type known to hinder the success of immunotherapy in the liver and pancreas, namely myeloid-derived suppressor cells (MDSC). Preclinically, we have confirmed that SD-101 has favorable properties relative to other classes of TLR9 agonists in targeting MDSC. Historically, delivery and optimal dosing have posed challenges for this class of drug, but our clinical trials have been designed to address these challenges. In 2021, we launched a series of PERIO or Pressure Enabled Regional Immuno-Oncology trials, starting with our PERIO-01 trial involving patients with uveal melanoma liver metastases. We believe this data highlights how PEDD has the potential to enable SD-101 across multiple indications. Dr. Sapna Patel from the MD Anderson Cancer Center presented the data at the recent Society of Immunotherapy for Cancer Meeting in San Diego. Key highlights from the presentation include data encompassing 56 patients across various dose levels and cohorts in this Phase I study, which was a dose escalation study. Patients were treated with SD-101 delivered by the innovative TriNav device targeting the arteries feeding the liver and the liver metastases. After establishing safety with single-agent SD-101, patients were subsequently enrolled in treatment in combination with intravenous checkpoint inhibitors. The enrolled patients had significant prior treatment, with 71% having received previous therapies including 16% treated with KIMMTRAK. Safety data reported at SITC indicates that the SD-101 infusions with PEDD, with or without intravenous checkpoint inhibition, were well tolerated. There were no serious Grade 3 or 4 treatment-related adverse events in the single-agent SD-101 cohort and 4% with SD-101 in combination with nivolumab. These rates align with or are even lower than expected in the absence of checkpoint inhibition. The safety profile may be attributed to the pharmacokinetic data associated with utilizing PEDD, which demonstrated high levels of SD-101 in the liver with limited systemic exposure as measured in the serum. Immunologically, Dr. Patel detailed the elimination of immunosuppressive MDSC and regulatory T cells through examination of liver metastasis biopsy specimens. There was also evidence of T cell activation within the liver and systemically. Early efficacy data at the optimal dose of 2 milligrams of SD-101 in combination with intravenous nivolumab revealed promising results. These included a median progression-free survival of 11.7 months, a 1-year overall survival rate of 86%, a disease control rate of 81%, and a ctDNA clearance rate of 57%. The optimal dose in these 7 patients was determined based on the efficacy data in addition to multiple immune signals. Across all evaluable patients, 86% demonstrated a reduction in circulating tumor DNA. In addition to PERIO-01, Dr. Michael Lee, also from the MD Anderson Cancer Center, presented safety and feasibility data from our PERIO-03 study at the SITC meeting. The PERIO-03 Phase I study is enrolling patients with treatment-refractory locally advanced pancreatic adenocarcinoma. They are receiving single-agent SD-101 with our groundbreaking TriSalus Infusion System, which utilizes a retrograde venous approach to circumvent anatomical constraints on the arterial side. There have been no serious Grade 3 or 4 treatment-related adverse events among the 3 subjects treated at the lowest dose level. Immunologic data from pancreas tumor biopsy specimens indicates effects consistent with those observed in the PERIO-01 study liver metastasis specimens, suggesting effective SD-101 delivery into the pancreas and consistency in TLR9 biology in both organs. In summary, we are encouraged by the Phase I uveal melanoma liver metastasis data and are optimistic that these findings will pave the way for success in other indications we are investigating. Additionally, we are excited about the early experience in our locally advanced pancreatic adenocarcinoma clinical trial, which holds promise due to the innovative delivery technology being employed. We eagerly anticipate further follow-up and enrollment in the PERIO studies. And now I'll pass the floor back to Mary for closing remarks.

Thank you, Dr. Katz, and a warm welcome to all of you participating in the call today. At TriSalus, we're delighted to share our achievements during the quarter, and we've made meaningful progress in expanding our TriNav business and continue to advance our PERIO clinical programs, both of which are shaping an exciting future for our company. With that, I'll open the floor for any questions you may have. Your insights and your investment are valuable to us.

Our first question comes from Jason McCarthy of Maxim Group.

Chad on for Jason. So what would be a meaningful response in liver tumors? And any extension in overall survival and quality of life? And what do you think you need to see to advance to a later stage program?

Chad, this is Jim Young. It's nice to hear from you, and I'm going to pass that answer over to Mary. Thank you.

Actually, I think it's probably a better question for Steven to respond to. Steven, do you want to jump in?

Yes, I'd be happy to do so, Mary. This, of course, will vary by indication taking uveal melanoma liver metastasis as an example. First and foremost, we're very interested in the safety profile that we're seeing in the early PERIO data. I think that as a backdrop is going to be critical to moving any program forward. And then beyond that, in terms of efficacy signals, we believe that circulating tumor DNA provides a very useful early readout of biologic activity. Beyond that, as a regulatory endpoint, we're optimistic about using progression-free survival as a measurement of disease control and then, of course, overall survival as a longer-term measurement of outcome.

Great. And so given the unmet need in uveal melanoma mets and it is the first proof-of-concept study for the combo. Is it possible a single-arm open-label Phase II may be sufficient for registration?

We believe that ultimately for full approval, a two-arm study will be required. There is precedent with the agency for openness using a single-arm study for an accelerated approval, but we believe that a two-arm study would ultimately be needed for a full approval.

Got it. And then in pancreatic cancer, the data in Phase I at SITC seems very encouraging, albeit early, what would be a meaningful outcome in that study to move to a Phase II?

Similar to the intrahepatic programs like uveal, we believe that progression-free survival would be a very meaningful clinical endpoint to provide a signal for moving forward into a Phase II. One of the things that we've learned from the data, particularly the data set presented at SITC, is that conventional response assessment criteria like RECIST 1.1 may not capture the full biologic activity of immunotherapy in these organs. Therefore, looking at progression-free survival, which captures both responses and durable disease control, provides, we think, a very comprehensive assessment of meaningful biologic and clinical activity. So we're looking toward progression-free survival in excess of 7 to 8 months as something that would be very meaningful in that disease.

Got it. And then I guess, lastly, in liver cancer, since you're using SD-101 in combination with a checkpoint. What is the impact of Tecentriq and Avastin moving to first-line liver cancer, the potential use of docs not wanting to move the patient and they progress to another checkpoint? Does SD-101 sort of change that narrative?

We hope so, and we hope it has the potential to do that. For HCC, right now, we're focused on second line and beyond, so the addition of Tecentriq or Avastin in the first line doesn't necessarily directly impact what we're doing in that regard. Based on the immunologic data reported at SITC, we believe that SD-101 has the potential to address the immunologic and biological reasons for checkpoint failure. Therefore, we're hopeful that medical oncologists will see the data and agree on the rationale for using SD-101 in immunotherapy or checkpoint failure patients is there, and we hope to generate additional data to support this.

And our next question comes from Justin Zelin of BTIG.

Congrats on the progress here. I'd like to ask Dr. Katz. Congrats on the promising PERIO data here at SITC. Just wanted to hear your view on how you see this fitting in the landscape in the treatment of metastatic uveal melanoma?

Thanks for the question, Justin. Right now, as we all know, we have one approved agent for uveal melanoma Stage IV patients, KIMMTRAK, which is limited by HLA type. So there's certainly an unmet medical need for patients that don't express that HLA haplotype. There's potential application there. Additionally, for patients who progress following receiving KIMMTRAK, there's a need for second line and beyond treatment. We believe that the safety profile presented at SITC, where the serious treatment-related adverse event rate, grade 3 and 4 for SD-101 with nivolumab is 4%, really places it very well in the therapeutic landscape for uveal melanoma liver metastases. If we see the disease control rate, progression-free survival, and overall survival continue to play out as reported for those initial patients at the optimal dose, we think it could offer a very compelling therapeutic opportunity for those patients.

Excellent. And maybe just some of your thoughts on how this data might provide some read-through to other potential solid tumor indications in other organs?

That's a great question and something that we think very deeply about. We're hopeful because we are targeting the same protein, Toll-like receptor 9 or TLR9, across all indications, which is present across all locations. We're hopeful that we will, in fact, see the same immunologic signals and similar clinical readouts in different liver metastasis and primary liver tumor indications. In addition to pancreas, the early data presented at SITC from the PERIO-03 locally advanced pancreatic adenocarcinoma trial indicates that the immune signals we are seeing in the pancreas and liver are actually consistent with one another, so that early data set gives us hope that we'll continue to see resonance across multiple indications and disease types.

Thank you. I'm showing no further questions at this time. I would like to turn it back to Mary Szela for closing remarks.

Thank you, everyone, for taking time to listen to our inaugural earnings call at TriSalus Life Sciences. We sincerely appreciate your interest, and I hope it was evident to all of you our excitement about the progress of the company. Thank you for joining us today.

This concludes today's conference call. Thank you for participating, and you may now disconnect.