Aurora Spine Corporation (ASG) Earnings Call Transcript & Summary

Good day, and welcome to the Aurora Spine Reports Third Quarter of Fiscal Year 2022 Financial Results Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Adam Lowensteiner, Vice President of Lytham Partners. Please go ahead.

Thank you, Betsy, and good morning, everyone, and thank you all for joining us today to review the financial results for our Aurora Spine for the third quarter ended September 30, 2022. With us on the call representing the company today are Trent Northcutt, President and CEO of Aurora Spine; and Chad Clouse, Chief Financial Officer of Aurora Spine. Before we begin, I would like to remind everyone that statements made during the course of this call may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended in Section 21E of the Securities Act of 1934. These statements reflect current expectations concerning future events and results. Words such as expect, intend, believe, may, will, should, could, anticipate and similar expressions are words that are used to identify forward-looking statements, but their absence does not mean a statement is not forward-looking. These statements are not guarantees of future performance and are subject to risks and uncertainties and other important factors that could cause actual performance or achievements to be materially different from those projected. For a full discussion of these results, uncertainties and factors, you are encouraged to read Aurora Spine's documents on file with SEDAR, including those set forth in periodic reports filed under the Forward-looking Statements and Risk Factors section. Aurora Spine does not intend to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. On this call, management may refer to EBITDA, EBITDAC or adjusted EBITDA, adjusted net income and adjusted EPS, which are not measures of financial performance under generally accepted accounting principles or GAAP. Management believes that these non-GAAP figures, in addition to other GAAP measures, provide meaningful supplemental information regarding the company's operational performance. Investors should recognize that these non-GAAP figures might not be comparable to similarly titled measures of other companies. These measures should not be considered in addition to and not as a substitute for or superior to any measure of performance prepared in accordance with GAAP. A reconciliation of non-GAAP measures to the most directly comparable GAAP measures in accordance with SEC Regulation G can be found in the company's earnings release. With that now, I'd like to turn the call over to Mr. Trent Northcutt, President and Chief Executive Officer Aurora Spine. Trent, please proceed.

Pleasure to be here, and thanks for having us.

Trent, do you want to proceed with the prepared remarks?

Yes, it keeps cutting in and out, and I get a high-pitch signal going through my phone. I'm sorry, it's like echoing back and forth. I apologize.

That's okay. Chad, would you like to read Trent's prepared remarks?

Yes, I can do that. Good morning, everybody. Earlier today, we issued a press release detailing our financial results. Hopefully, you have had a chance to review that news release, but if not, a copy can be found on our website, aurora-spine.com under the Investors section or other financial websites. To lay out the agenda for the call today, let me first summarize a few key events of the quarter. I'll then talk a bit about the status of each of our key initiatives and products like ZIP and SiLO as well as our initiatives on the Spine division, including our DEXA product line. Then Chad, which is me, who'll give a recap of the financial results. As we anticipated, the third quarter was a lower quarter on a sequential basis due to the slowdown in procedures performed in the summer months due to extended vacations in the medical community. That said, the third quarter was still a very productive quarter as we continue to focus on growth through product placement and education and still produced even stronger revenue growth over last year and positive EBITDA. On a macro level, we continue to see momentum gaining in the minimally invasive surgery market, especially with regards to the reimbursement coding, as insurances are embracing more procedures that can be done in a minimally invasive manner and have the patient recoup at home in a quicker time frame. For oral products like the ZIP and SiLO are complementing the doctors and their patients and designed for minimally invasive procedures. I believe these catalysts are why our products are able to gain the traction we've been receiving. In addition, our products offer alternative ways for doctors to treat patients with as little pain medication as possible, especially given the opioid epidemic in the United States in recent decades. This too is a main tailwind for the med tech industry. While Q3 was a little bit on the quiet side, shortly after its close, we built up some significant momentum heading into the North American Spine Association, or NASS, industry conference, which took place in early October. Specifically speaking, we received FDA clearance for the SiLO TFX, which was a very important catalyst for Aurora and the future growth opportunity within the SI joint marketplace. It is still in its very early innings. Obtaining this clearance improves our IP franchise, but also demonstrates that we've created a new product that offers transfixing capabilities, which is something many doctors are desiring. We are currently moving forward on preparing initial surgeries for the TFX. If all goes well, it should be ready for commercialization in Q1 2023. We'll definitely keep investors updated with this progress with the TFX as we believe it will be a contributor to our growth for several years to come. The ZIP series continues to be a nice contributor for Aurora, subsequent to the third quarter's end, we were pleased to learn the initial positive interim results from the clinical study using the ZIP, which was published in an abstract posted in the publication Pain and Therapy entitled "a prospective, observational, open-label, nonrandomized, multicenter study measuring functional outcomes in a novel interspinous device in subjects with low back pain: REFINE study". The publication discussed the results of the interim 3-month analysis, which included 54 patients, of which 82% reported improvement as a result of the procedure, while 65% of patients demonstrated clinically meaningful improvement in their pain and function. The publication also demonstrated that the use of the ZIP device was both effective and safe as a 3-month follow-up. The study remains active and enrollment is continuing with more follow-up data expected in the future as more patient data is compiled. The study included results gathered from 11 doctors and conducted on behalf of Aurora Spine to determine the utility of using interspinous fusion devices as a fusion therapy for the treatment of lumbar spinal stenosis. The treatment of lumbar spinal stenosis has a large unmet treatment need that bridges the gap between conservative measures and invasive surgical procedures. In this publication, it is an exciting validation of Aurora's Spine's ability to provide safe and effective outcomes by utilizing Aurora's ZIP product line. We look forward to the additional results set to be published at the 12-month collection point and believe it will be a continued trend positively for our physicians and their patients. Last but not least, moving on to the DEXA. We have invested heavily during the third quarter to build several surgery kits for the DEXA-C and are in the midst of placing them with doctors as we speak. We started the year initially with just 2 kits in our field, and were able to ship another 2 earlier in the quarter, which helped incremental revenues that DEXA represents. 10.5% of total sales in the third quarter were approximately $383,000 and this was up from DEXA-C sales beginning at 5.3% of revenue in the second quarter or approximately $212,000. This demonstrates that we believe DEXA-C could be a meaningful revenue source for Aurora moving forward. As we expressed earlier, we have developed several kits for the DEXA-C and are now in possession of finalizing many of them and we'll have recently shipped into the initial tranche of them into the doctors. While initial deployment shows successful deployments, we do want to express that not every deployment will equate to the success of our initial team working diligently to make sure that we share these kits with doctors that will not only will try the DEXA technology, but also will embrace it into their practice. Also another factor to remember is pricing. Since DEXA is a proprietary product of Aurora, we should be able to have some financial flexibility regarding to the internal costs, but there will be some price variations depending on the doctor and their practices and what type of economics they use going into their procedures. Our goal is to place DEXA in the hands of doctors that embrace new technology and are looking for something that is better than for their patients. DEXA certainly offers that more. We're very excited about the DEXA overall, and as we initially launched with DEXA-C, it should be a key growth catalyst moving forward. Regarding our FDA-cleared DEXA Solo-L, which we will just shorten to DEXA-L, spinal fusion system, which will have a second DEXA product release, is a 3D-printed stand-alone anterior lumbar interbody fusion device. The DEXA-Solo-L, part of the DEXA technology platform, is a standalone device for anterior and lateral lumbar interbody fusion or the acronym ALIF or LIF for anterior lumbar interbody fusion or lateral lumbar interbody fusion procedures. This is the first of its kind device for lumbar spine in the world. It's also the first color-coded bone-mimicking structure implant in the marketplace that will help doctors match the patient with the patient's bone quality and density. We are in the process of building inventory for this product and hope to have it used in initial surgeries during the first quarter of 2023. Our goal would be to launch a couple of kits in this procedure and then build out more in the second half of 2023. We'll keep investors updated on our progress summary. To summarize, I'm extremely proud of the team's performance and sustained focus on building this company. We are well positioned to take advantage of growing markets with several new propriety products. We remain focused on penetrating these markets further with year through continued training, succession and clinical trials. Looking to the long term, we will be well positioned for success, especially as we have new products, more clinical studies, proving our technology and teaching more doctors to use Aurora products. We remain highly focused at the opportunity that is in front of us, and we continue to invest in our growth with each of our major platforms, ZIP, SiLO and DEXA. I will now turn over the call to our CFO, Chad Clouse, Aurora Spine CFO, and will return to review the third quarter financial numbers.

Thank you, Trent. Thank you. With a number of highlights and detail in the press release, just let me focus on a few of the areas. Revenue during the third quarter of 2022 was $3.6 million, a 26% increase from the $2.9 million of the third quarter of 2021 and a 10% sequential decrease from the $4.1 million in the second quarter of 2022. The improvement in revenues from the prior year was driven by strong use of proprietary products, especially ZIP and SiLO Devices as well as the addition of DEXA-C. Revenues were sequentially lower due to lower procedure volumes due to extended vacations in the medical industry. Gross profit in the third quarter was $1.9 million, an increase of 43.2% over $1.4 million in the third quarter of 2021 and a 9.3% decrease from $2.1 million in the second quarter of 2022. Gross margin was 53.2% in the third quarter of 2022, up from 46.8% recorded in the same quarter a year ago and compared to approximately 52.6% of revenue in the second quarter of 2022. Gross margin showed continued progress and improvement on a year-over-year basis as more proprietary products are part of our revenue. We believe over time that the margins have the capability to continue to expand beyond these levels, especially as our primary product sales increase. Total operating expenses in the third quarter were $2.1 million, which is sequentially lower from the second quarter of 2022, which was $2.4 million due to the completion of some R&D expenditures. As the company continues to make key investments to grow the business, which include new salespeople, conducting clinical studies, training sessions and R&D expenses towards new products, investors should anticipate these levels to remain at these levels in the coming quarters. We do believe these investments will put the company in a proper position for accelerated growth and sustained profitability. EBITDAC in the third quarter of 2022 was $151,000 improved from the second quarter, which was $96,000 and a loss of $171,000 when compared to the same quarter a year ago. Net loss in the third quarter was $116,000 or $0 per basic share and diluted share, an improvement from the second quarter, which was a loss of $160,000 or $0 basic diluted share. The improvement from a net loss of $368,000 or negative $0.01 compared to second quarter 2021 results. These improvements come directly from sales of proprietary products and lower expenses. Turning to the balance sheet. The company ended the quarter with approximately $650,000 in cash and cash equivalents. We believe these levels are sufficient to fund the company in the coming quarters. Accounts receivable decreased sequentially to approximately $3.7 million from $4.1 million in the second quarter due to improved collections. We believe we are on our way to receiving additional funds in the coming months. We're consistently monitoring our receivables and we can diligently collected in a timely fashion. Our inventories have for now plateaued as we completed building our DEXA-C kits, which are now being deployed. We continue to monitor expenses and tight controls over our costs. We should have some continued savings from lower R&D expenses now that the SiLO has been approved, and we believe that we have the necessary capital to move the company forward as we improve collections on accounts receivables toward to improve cash flow from operations. This concludes my comments. I'll now turn the conversation back to Trent.

Thank you, Chad. Before we open the call for questions, I'd like to conclude that we continue to make improvements initially to make sure that we remain on track for sizable revenue growth. In the interim, we are in the midst of improving our sales team, especially now we've had several new products to take the company to the next level. We're also working on moving into a new office to accommodate all of our employees, putting everything underneath one roof and operating in an internal training lab to host medical professionals with our sales team in our office. While there are some near-term costs for these improvements, we believe they will be beneficial for the long term. We obviously have more work to do, but the company is in a solid position to capitalize on IP improvements. We've stabilized the past 2 years and it's truly amazing to see the opportunity for our organization to grow. We are highly successful in creating new proprietary products and outside the dentistry, that we can scale the company on the commercial side of the business. I appreciate everyone's patience and believe that we are in the early stages of reaping the rewards of our efforts. So far, we are very pleased with the progress of these initiatives and are very excited about the remainder of the year and beyond. With that said, operator, we are ready to take any questions.

[Operator Instructions] The first question today comes from Tom Fedichin with Microcap Connection.

Congratulations on another successful quarter. I want to dig into the doctor vacations, how has that impacted sales and have sales rebounded since?

Yes, the 2 parts of it. Yes, we have seen getting the procedures that were drawing the most new revenue for the company, like SiLO and getting the ZIP's back on track. Many of those doctors who went out on holiday came back and now are doing those procedures. The hesitation that I have on the Q4 is the T-code or the category 3 code with the posterior allograft systems and that coding reimbursement that there was a concern there for a bit. That ran all through late spring, early summer, all the way up until the current date. The conversation was out there in the field and then indeed, they made the announcement, I don't have the date off the top of my head, but they made the announcement that they're going to move the allografts into a category 3 T code. With that, it didn't change the economics behind it. So there wasn't anything that really told the doctor that they were going to lose money or they wouldn't make any money or they shouldn't do the procedure. There was nothing that said that. It just said that they're going to add that modifier to that code, that category 3 would be added to the coding reimbursement. So with that said, since no one has been affected directly by any type of financial impact under the procedure, we see that it's kind of steady with that. There's been that pause where we've seen some doctors that we would say that would do 6 of these a month now are looking at this, like, well, maybe I'll just do 3 and see where it falls in the beginning of the year. They're not going to make any additional announcement of any major announcement until July of next year on the allograft system. And then just let me just add to that because it's important to note that we have submitted the SiLO TFX, and we do not believe the SiLO TFX effects will be affected by the category 3 code because we believe it falls within a different guideline of SI Joint Fusion. This actually will turn into a real winning opportunity for Aurora because it would be kept in the same reimbursement codes as SI and Medtronic's and others of that category. So we're seeing this as a mixed blessing, mixed opportunity, and we think that it could be really, really substantial for us, especially that we're making good progress on getting the TFX instrumentation completed so we can initiate our first alpha procedures with the TFX. So I realize I answered a much bigger question to your initial question. In Q4, I remain positive that we can pulse the numbers together for the Q4. I am going to be affected this week in sales because we do a lot of surgery in upstate New York. As many of you know, they moved a whole NFL football game to 2 different states because of that. So this week is going to be tremendously slow on top of the Thanksgiving holiday, but hopefully, we can make this all back up this week.

Can you tell us about the DEXA sales? You did -- 10% of entire company sales were from DEXA-C. How many kits were handed out? What did that equate to? Was it 4 kits that equated to 10% of entire sales? Or was it 10 kits? How many kits were outstanding?

Roughly about 4 kits out there, but now we'll have up to 40 kits available and completely in everyone's hands with some extra say, 35 will be out in the field or 30-plus be out on the field with a couple, 5 or more in the office to build a maneuver as needed. The sales team is moving those kits into position with a couple of key people. Especially, we had 9 surgeons come to San Diego for a DEXA review, roundtable review, with a blend of ortho and neuro doctors and all 9 of those accounts are receiving their DEXA inventory. We're working with their hospital to make sure we're approved at their facility for the pricing, improved onto the hospital contract itself because it's a newer product, and it's now finally in their hands, and sometimes the hospital isn't going to allow you to get approval on the products until it's actually available. So now that it's available, we have some work to do on it, but that's part of the process and we plan on keeping those kits all out in the field all through the fourth quarter and going into the beginning of the year. We are encouraged by that. It could be a real revenue generator for us.

Would you say on average a doctor, I know we discussed this in a different call, that an average practice would use 10 such device products in a month per doctor? Is that something you're seeing off of the 4 doctors currently right now?

Yes. It won't come off that. It won't change that. It's definitely the ability to do 10 procedures, not including levels and procedures. 10 is very fair. One particular facility actually has really good pricing that we know of, and they're going to actually give it to their entire educational department. So it's not just one, say, one doctor, the whole department is going to be using the system, and we're really proud about it. We're not going to see who it is because a competitor wouldn't like it, but we're definitely going to benefit from that.

Wonderful. On average, a device implant for DEXA-C is $3,000, is that fair to say, approximately?

It is now. For right now, that price will definitely be adjusted because if you look at like an HCA cervical price can be as little as say, $800 per unit, but we're not running to all the HCA facilities. We're going to different facilities because it's new technology, and it's not old technology. So we're trying to stay away from that older price technology, we're trying to stay on a new technology track line.

Okay. How many kits do you think are plausible to have out in the field for 2023 of the DEXA-C?

Well, plausible would be, if all 40 of the kits are turning and we can't keep the product on the shelf, then I have no problems with doubling down on the inventory. There's no reason why we wouldn't. It's a very high volume procedure and with a really high success rate. It's got a plus 90%-plus success rate, and we think we just made it better. So with that said, we plan on bringing all those kits out and if I have to put 80 sets in the field or 140 sets in the field, I'll do it.

Yes. Okay. Now you've got your DEXA-L, which is the secondary DEXA line or DEXA product that will be coming on out. Q1, you'll be certain your data rollout, is that correct? Do you feel you'll have a similar success as you've seen with DEXA-C?

I do. I do. It has a really strong price point. It's an average selling device of over $6,500 per unit. So it has a very low COG, very high yield and a lot of procedures because it competes in the world of pedicle screws and pedicle screws is 48% to 52% of all revenues of all spine companies. So, it's the mega product. If we get some people as excited about the cervical and we'll use the cervical data that we're coming out with and the biomechanics data in a single-arm multicenter study with the DEXA and the write-ups that we're getting from these physicians using the cervical, and we'll apply that right over to the lumbar and start talking to more and more doctors about the success that they're having with cervical that they should carry this over to their lumbar practice. Some doctors do a very high volume of lumbar procedures where they could do, depending on the doctor, of course, but they can do multiple procedures in a week. And they can do this procedure to use the DEXA-L technology, and they can roll the patient over from an interior position to roll over on to a prone position and actually back up this patient and use the ZIP implant in conjunction with the DEXA-L implant. So now, the doctor is able to do a double billing on that where they can bill for anterior and posterior work, they call the spine-360 procedure, and then Aurora can actually bill for the DEXA-L and for the ZIP separately. So that would change that pricing from, say, a $6,500 procedure to a $10,000, $12,000 procedure or more.

Wow. Now with the new rollouts of DEXA-C and of course, DEXA-L coming, and the potential of we've seen billing co-changes, do you feel in Q4 and even in Q1 moving ahead, that DEXA-C will by far make up any lost sales that you could potentially see or a slowdown in sales in Q4 coming ahead?

I really do. In fact, that was one of the things that during the summer when we were getting the sets ready and queued up is that we talked about the T code and the category 3 code and how is that going? What was that looking like? How is that slowing down on top some of the vacations and why people were just taking a pause? The procedure is doing well. Patients are doing well on the posterior SI procedures, but this T-code made everyone kind of think a little bit. So for us, we said, well, look, cervical, the codes haven't changed and reimbursement haven't changed and cervical procedures are increasing. So we've said that since we're going out to brand new customers, many of these doctors are using the DEXA-C, these were brand-new customers for us because we have another cervical device in our portfolio, which is called Discovery, and that Discovery implant is still widely being used in our company. So we are trying to work with the doctors that are not using our Discovery implants and that want to use the new DEXA-C implants. Again, this will also lead to new DEXA technologies for doctors to try as we go along.

Okay. As for doctor training and increasing amount of doctors selling your products, how is that going? How many doctors did you train this quarter? What do you plan on training for the balance of 2022? For that matter, how much for full year 2023, how many do you plan to train?

I don't know yet. I'm just going to answer our ones on that. I don't know how many we plan for training next year. We want to see how the excitement is for the SiLO TFX, we think it's going to be quite extensive. We think a lot of people are going to really want to be trained on this product. We would add it into our current protocol of training and education, which is doctors would come in for the ZIP, the SiLO and the SiLO TFX training, it would all be part of a comprehensive training. One of the things that we're considering doing is we want to add to that training because we've been, essentially kind of feathering it in as an overview, but not necessarily as a topic on a full breakdown didactic session, but breaking down a full didactic session on DEXA technology as an introduction to some of the pain interventional doctors that don't normally follow osteoporosis, osteopenia as a part of their practice, to give them an education on implants that are better suited for bone density and density-driven implants such as DEXA implants. Adding that as part as an overview, obviously, you don't need a cadaver lab to teach cervical implants, the implants are intuitive and so the doctors don't need surgical training on that. Same with ALIF because the procedure has really been known now, so there's no cadaver lab needed for the ALIF DEXA implants. But an overview might be important. So as far as the headcount is going to look like, maybe Chad knows how many we did this quarter because I'm not sure how many we've done this quarter, but I want to say it was north of 20 doctors in, say, Q3 to current date, but it could have been even higher than that got trained on ZIP and SiLO implants. We started to narrow the trainings because we were watching the category 3 coding. So we slowed some of the trainings down a little bit just to make sure that in case there were some major changes that really affected the coding and reimbursement to the point where they weren't going to do the procedure, and we didn't know that for a fact that they weren't going to do that until midsummer, as it was being sorted through with the AMAs and the CPT code reimbursement and committees and so forth.

Well, you've got 60 monthly purchasing doctors as of our last call, do you feel it's plausible to double that number from now during the end of 2023 to 120?

Well, so that it's a fair question. Part of that was the numbers that we had that were ZIP and SiLO and current customers, here's the group of doctors that we were already working with to the considers we were working with. Now with DEXA, some of these will be brand-new doctors that have never used our system before. So this would improve that monthly headcount of users in our daily sales report and quarterly sales report. Also, there's a lot of doctors out there that we obviously do not work with. We think that number will really help Aurora because it will help us once we get the TFX out and available because we're being contacted pretty regularly through our salespeople, when is the TFX going to be available because I'll start switching to that? These are current users of other competitive systems. So we're going to be able to pick up a new, very robust, well-trained group of doctors that are already using competitive products, and we couldn't be more excited about that because we'll have, we think, the best implant available for them with all the latest technology that's going to give them the extra feeling of fixation and ease of use and get their patients back up on their feet and out the door.

Would you say that the SiLO TFX will provide at least the same results as SiLO did per doctor per device products sold per month? Can we expect to see similar numbers of SiLO TFX as we saw out of the SiLO for 2022 for 2023? Of course, with the new product rolling out and of course, newer doctors coming on board, do you expect to see sales growth surpassing what we saw in 2022?

I think TFX will outperform SiLO by a multiple of 10x. I think it's going to kind of blow SiLO out the door.

Okay. Will you discontinue SiLO as a result?

Not unless the coding tells us that it's not going to be used anymore, but we don't see that happening. So we think it will be nice to have options. Some people like fish, some people like chicken. They'll be all they have an option here and we'll give them that option.

Okay. Moving on to the ZIP, you've received the FDA approval for the ZIP lumbar. Will we see that in 2023? When do you expect that will start to roll out?

You're talking about the ZIP FLEX?

Yes.

So just because of the excitement of DEXA and DEXA-L, we've been letting the cat out of the bag in a fun way that we're also working on, once we get the TFX out and running and get it really going, we already have the study protocol is being put in place to IRB submission. So we'll go into a multicenter study. The very first call it, week of trials that we do with the TFX will be starting in a multicenter study. It's no secret that once we get the TFX out and running -- we've already been working behind the scenes to make the TFX into a DEXA implant. So that will give us our third implant that will have, what we call, DEXA-fied, and will be the only game in town. So we think that's going to be a real win for us. So with all that said, my focus has been let's stay on track with the multicenter study. Let's see where the SiLO goes. We've got the TFX that we need to roll out and we've got DEXA-L that needs to roll out and with TFX being converted over to a DEXA portfolio, I think that the ZIP FLEX, although it's a pet project of mine for sure and the same with our Chief Technology Officer, but I think it's better suited for us to push that back towards the end of the year and see where it falls into the priorities once we get the other priorities in line because we're not in a big R&D phase in the company anymore. We're more in getting the implants that we've worked so hard on the last number of years to get them out and commercialize and show real successful numbers because then we can build off those numbers right into some future technology. And we do. We have a nice portfolio behind the scenes that we don't talk about that's keeps the pipeline full, but I want to execute on these implants. So ZIP FLEX is definitely going to be pushed back another year for us because it's just not ahead of other priorities.

Okay. Now you spoke about margin expansion in the press release, what sort of margins could we see as newer proprietary technologies implants are released?

So one of the conversations that's happening, and again, I don't speak for any of these committees, I'm only a participant in the coding and the reimbursements like the rest of the vendors, but they're saying that the coding could increase in posterior lateral SI fusion and that there could be some modifications to it that actually allow the facilities to go build from, say, $15,000 to as high as like $22,000, $24,000, so that would be a significant increase, obviously, and if that's the case, that's where that would come from. This is something that was presented by coding reimbursements that have physician consultants that are not affiliated with Aurora. They're part of a committee that's trying to find the right balance of what the coding reimbursement needs to be for these new technologies.

Okay. Last question is, moving forward, looking at Q4, yes, of course coding has played a bit of an issue with the doctors' confidence. Do you feel we're back on track? Do you feel that we could see $4.5 million to $5 million this quarter? Is that realistic?

It's too soon for me to tell. I'm pausing on it only because I just want to see how this folds out to the rest of November, but I do plan on having an early December call that I'm going to be scheduling with Adam because I want to keep investors in the light, so that way, they're not sitting back guessing on it. I made some changes, I wasn't pleased with some of the business strategies. So, I made a decision to part ways with my Vice President of Sales, mostly on the spine side. So I parted ways with him and I'm adding some new sales talent in some areas that I feel like we need to focus on. The rest of the team is completely intact and engaged and excited and bullish about what we're doing, but I needed to get a focus back on some of our spine technologies versus our pain technologies. I wanted to get back on track with that. So if you'll bear with me and let me come back to everyone in December. I will put that call together through Adam, and then we'll get back out to everyone after we close out November.

[Operator Instructions] This concludes our question-and-answer session. I would like to turn the conference back over to Trent Northcutt for any closing remarks.

Thank you for joining us. We appreciate your time and interest in Aurora Spine. We are very excited about what's ahead of us in 2022 and beyond. We look forward to speaking with many of you in the weeks ahead. If you have any questions, please feel free to reach out to Adam at Lytham Partners, and we'd be happy to schedule any follow-up calls. Thanks again, everyone. Have a great rest of your day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.