Kuros Biosciences AG (KURN) Earnings Call Transcript & Summary

Good morning, everyone. Welcome to Kuros Biosciences Capital Markets Day 2026. It's great to have a full room here in Zurich, and welcome to everybody online as well. I hope you enjoyed the little preview of our new U.S. headquarters in Alpharetta, Georgia. We're very proud to say that, that opened 2 weeks ago for the office staff, and we will be opening for manufacturing in August. It's a 50,000 square foot space. And currently, we occupy 35,000 square foot of that with room for growth. My name is Carly Dummer, Senior Director of Marketing for Kuros. I am very pleased to be here today to introduce you to your hosts and presenters for the morning. I'll share a little bit about the objectives that we have for this session and the agenda before I hand over to Chris. Okay. So hopefully, you recognize most of these faces. Presenting to you today will be Chris Fair, our CEO; Joost de Bruijn, inventor of MagnetOs and Founder of Kuros. And our President, now our Executive Director and President of Innovation and Strategy; Daniel Geiger, our CFO; Joe Ross, SVP of Marketing. And last but by no means least, we are honored to be joined today by Mr. Andy Golberg. Mr. Golberg is a foot and ankle consultant surgeon practicing in the U.K. He is a leading authority in ankle replacement. And in 2011, he was awarded an OBE by the Queen for his dedication and commitment to medicine. So thank you, Mr. Golberg, for being here today. So in terms of our meeting objectives, we know that you as investors really want to understand how we intend to achieve our profit and revenue targets. So we'll really focus on explaining to you today how we plan to make that happen. The team will walk you through our commercial plan and our business transformation initiatives, really with the aim of driving that compound enterprise value. This wouldn't be a Kuros Biosciences presentation if we didn't share evidence and data. So you'll hear a little bit about our clinical strategy, some innovation initiatives. And very excitingly, Mr. Golberg will share with us his practice. You'll hopefully learn a little bit about the foot and ankle space, and he'll talk about how MagnetOs has had an impact for him. Following last year's meeting, we heard that you wanted to understand a little bit more about the surgeon impact, but also a patient perspective. So we are also very pleased to share with you today a video from a patient called Alison, and she'll talk about the personal impact of MagnetOs to her. So in terms of the agenda specifics, we're going to have Chris kicking us off with our global commercial strategy. Where we're expanding into new markets and most recently, the trauma space. And he'll also share with you some of our customer engagement initiatives really designed to educate the surgeon community and to create a community and really make sure that we're understanding their needs and pivoting as we need to. We will then have Joost talk through how we're really continuing to differentiate MagnetOs through our evidence generation and some really exciting initiatives that have been driven from our customer engagement events, really understanding their challenges and their needs and how we can really prove fusion potential with MagnetOs. Joe will then come up and talk through our product innovation pipeline. So you'll get to hear a little bit about upcoming products in the short, medium and long term. Then we'll have Mr. Andy Golberg, who will come and tell us about his experience. And as I said, you'll hopefully get to learn a little bit more about foot and ankle procedures. We'll get that patient perspective and then rounding out with Daniel, who will talk through our business transformation initiatives. We will then have a Q&A. So for those of you online, please feel free to submit questions throughout the morning. For those in person, Daniel will lead the Q&A here at the end. And with that, I'll hand over to Chris.

Thank you, Carly. I don't think I need the microphone. Perfect. There's water. Good morning. I was told I have to stay within certain bounds because of a camera. So if I get out of the side of camera, I'm sorry, I like to dance around. But good morning. It's been such a journey here for Kuros and many faces in this room we've seen repeatedly over the years, and the story continues to get better. And we hope today is no different as we talk about what we've built to date, but more importantly, how we plan on building into the future. We start every meeting within the organization to remind ourselves what we're based upon. We are our foundation. How do we see ourselves within the company? How do we act as servants to our patients and to our teammates and surgeons. And so these are our guiding principles and our mission as an organization. So this slide is something we started putting out there, but last year, first-time profitability is not a small point to just overrun. It's a very big moment in time for any medical device company or any company in general. And so for a company our size, growing as fast as we are to achieve profitability with no debt. That is a massive achievement. We're quite proud of it. So when we look at some of the 2025 and then understanding where we were to understand where we're going, you look at the consecutive top line growth and you look at the profitability, last year, we went to $146.1 million in revenue in U.S. dollars, 72% total growth and achieved over $19.8 million in cash. Again, a growing business like this continues to feed but also incrementally improve the bottom line. So qualitative and quality growth is extremely important to this business. We've achieved it earlier than we anticipated, and we'll continue to add on that as we move forward. A slide I'd like to point to is not too long ago. So this is a slide highlighting different technologies. This is U.S. information specifically, talking about other biologics products within the marketplace that we compete with as well as don't compete with currently. So when we look at this, a year ago, we were in the #9, 10, 11 position. So in 1 year, we've moved to the #3 position in all biologics. If you just looked at products in fusion, which is the category today that we operate in, we've moved to #2. That is a huge jump in a single calendar year and is a testament to how surgeons have accepted our products. When we start talking about the global commercial strategy, we've talked about -- we started in spine because the spine marketplace is a $4 billion-plus marketplace. But we also launched into the extremity space, specifically foot and ankle. And we'll talk about the procedure volumes here in just a second to support that and the reasons why. We started that with a small group of surgeons to make sure we had the right product for the right indications for the right applications. Do we need to have new part numbers? Do we -- is it effective enough? What cases would we focus on? If you're going to do something, you should do it right and take the time to understand it. And that's what we did in the first year. This calendar year, what we're focused on is incrementally building the revenue stream as well as the clinical evidence. We launched the Level 1 trial Q4 of last year called the ASTRA, and we'll talk about that in a little bit. But we're making investments into the marketplace because it is fast growing. And because for us as a business, as an orthobiologics business, we wish to have a wide base servicing the musculoskeletal community. It started with spine. We walk into a foot and ankle, no pun intended. And then we go into trauma. But trauma is also a big marketplace, a lot of different challenges with that, and we'll talk about that in a minute. And also oncology has a special place for us. And the reason being is the mechanism of action of our material is very unique. It allows us to be used in an oncology patient where other technologies are, quite frankly, not allowed to be used. It's harmful for the patient. So this slide is a new slide for those of you who have been watching our decks. But what the story is being told here is where are we taking market share. So if we just look at the marketplaces where we center on between the advanced biologic phase, advanced biologic materials, there are peptides, cellular-based allografts, that's CBA, that's human tissue with cells, growth factors, synthetics and then ourselves. And what you see from this is we are continuously taking market share. We're taking market share -- the peptides are essentially flat. Their growth has remained flat year-over-year. Cellular allografts have come down a great deal. A large part of that is the mounting clinical evidence that we have and the amount of evidence that those products have, which is 0. Hospitals are becoming more and more aware of the risk and also lack of reward in that category of products. And also from an expense perspective, a more cost-effective solution for the patient by going with us. And we also see growth factors coming down. Growth factors would be the category of BMPs. So all in all, we are gaining market share within the category. We're gaining market share within the industry. And again, moving from a #9 to a #3 position. All of this combined shows you the impact that we're having in the health care community. So we're asked often, how many surgeons are there? And these are U.S.-based surgeons, and we collect the data, and this is how we base our penetration rates. So we thought it would be a good idea to share with you how we look at the world from a surgeon base, what those numbers actually look like. So about 7,500 surgeons completing spinal fusion procedures in the U.S. The reality is about 4,500 of those surgeons are doing more than spinal fusion per week. Those are the true spine surgeons that are busy in their practice. The others, every once in while, maybe it's a trauma patient that they might have walk in, they might do a laminectomy. But for the most part, we base it on the bottom number of 4,564 are true spine surgeons. And then when we look at the target procedures, we looked at anterior cervical fusion, posterior cervical fusion. And so we looked at all the typical fusion procedures where a product like ours could be used -- it's about 968,000 procedures. That's a lot of procedures. That's a lot of opportunity, and we're just getting started. When we start looking at the foot and ankle marketplace, there's about [6,05977] foot and ankle surgeons, which are basically orthopedic surgeons as well as surgical podiatry surgeons in the United States doing fusions in the foot and ankle. But if you look at and say, who's really doing the work, there's about 1,800. From a procedure volume, over almost 600,000 foot and ankle procedures are being completed. And then we start looking at the trauma. Over 19,500 physicians take trauma call. But there's really about 4,000 of those surgeons that are actively treating trauma patients on a regular basis. And so we start looking at the number of procedures, how many surgeons would we have to educate, look at penetration rates, but you're talking about over 636,000 procedures where products like ours could be applied. And we haven't even really touched this marketplace. So when we ask our customers, whether they're spine or foot and ankle or otherwise, what's important to you when selecting a material like ours? First and foremost, Level 1 data. It's a really quick conversation because not many biologics businesses invest in Level 1 data. As you've heard the story before, we consistently invest. We continue to invest, not because it's a regulatory requirement, but we believe it's our responsibility to do so. The educational events, learning from peers. The best way for a surgeon to hear about using of a product is from their peers. As much -- as charming as I can be and as great of a story as I can spin, it's much better to have a surgeon talk to a surgeon about their clinical usage. And so we ensure that the events that we put together allow for surgeons to teach surgeons, talk about their cases, talk about their failures, why did this work? Why did this not work? And that is where community is built, and that is what we have fostered, and we'll talk about that here in just a few minutes. I think evident innovation and evidence generation. So as you go through and doing a study, a lot of ideas come through that. As you're using a product on your 20th or 21st time, a surgeon will say, gee, wouldn't it be great if this thing had this, not just in biologics, also in hardware and other areas. And so we want to make sure we're capturing that. And so we have the events to do that. I think from a user requirements, the product has to work, not just biologically, you have to be able to work within the surgeon's hands. They have to be able to put it in the patient and have it stay where they're going to put it. That's a really bad feeling when you put -- you open up a box of a product, not a competitor product, of course. And if you put it into a patient and all of a sudden, it just gets washed away. That happens. And so it's -- from a surgeon's perspective, they want to make sure it goes where I want it to go all the time. And the indications, regulatory approval, some products are approved for a certain indication. It may be approved for a single-level cervical fusion. But if they use it in the lumbar spine, they're using it off-label. And they run the regulatory risk. If there was any type of downstream lawsuit that could be used against the surgeon. Our product being regulatory cleared throughout the musculoskeletal system removes that risk from a legality perspective. And then our sales force. We have a tremendous sales force that is educated. We train them on a consistent basis. It's an independent sales network, but we have employees of Kuros that spend their time working in the OR with surgeons as well as the sales force. We have a strong team of medical and scientific affairs people who have PhDs and our MDs working with physicians to ensure everybody is trained to the highest level throughout the organization. And these are all commitments for our customer. So when we talk about expanding into new markets and we say, well, gee, those are big numbers for spine surgeons. Look at the growth. The growth-- although the total dollar number in foot and ankle is much smaller than in spine, there is a massive growth upswing occurring. And so we started the ASTRA Level 1 trial in Q4 of last year. I believe 15%, if not more, is already currently enrolled, and that's going to be a great study for us in supporting the foot and ankle marketplace. We are building an extremity-based distribution network within the United States, much like we built in the spine, finding those folks who spend their time in the foot and ankle surgeons. Our foot and ankle focused education, foot and ankle meetings, foot and ankle materials, although the foundational material is the same and it operates in the body in the very same way, how you deliver the information is different. A spine surgeon and a foot and ankle surgeon -- they're both surgeons, but they have -- both have different experiences clinically, and we have to make sure we're putting the right product and the right information in front of them accordingly. We've also hired specialists who solely focus on extremities, both from a clinical background, a sales background, so they can work with the physicians on how to use this product and translate that, not coming from a spine person, but coming from an extremities person. And then we talk about the orthopedic trauma, which we are in the very early days of. So if we go through time, we started in spine, but we went to foot and ankle. We started with a small group of surgeons, made sure we had the right product for the right indication, we launched the study. That same methodology being used with trauma. We're currently working with a small group of surgeons now, identifying the right procedures, make sure we have the right product, and then we will eventually launch a study. This process is methodical on purpose. It ensures we're doing the right things at the right cadence and we're not moving too fast, chasing revenue when we're truly trying to chase the outcomes. If you chase the outcomes first, the revenue will occur. If you chase the revenue first, you're short change in the organization as well as the customers and the patient. Again, massive growth opportunity within trauma. And so why is this such a great product for a foot and ankle? And certainly, we'll have a surgeon come up and talk to you shortly about his experience. Nonunion is a problem. And I know that we'll see a little bit evidence that shortly. But when you have a nonunion, your limitations on the patient continue to get worse. In spine fusion, you can revisit that fusion site. You have another level you can take to create stability. You don't have that option in foot and ankle. And so we also look at the marketplace. There's not many biologics companies focused on this space specifically. And the reason being is spine is so big, they just spent their time over there. Our vision is building a global musculoskeletal biologic company. And in order to do that, we have to have a foundation in extremities, foot and ankle and trauma. So we're investing in the studies. The predictable handling and staying put, that is actually a really big advantage for us in the foot and ankle space. And obviously, having an osteoinductive graft used in the foot and ankle space will assist in the healing response. And again, Mr. Golberg will walk us through that. Trauma. The thing about trauma is we don't know when somebody is going to fall off the ladder. We don't know when somebody is going to get in a car accident or train for an ironman and have a clavicle break. One of our colleagues had that happen actually. And so it's very unpredictable. So clinical studies become a challenge, but there are nonunions. And there are ways we can identify certain patient populations to prove our point to the trauma community. That's where we are currently focused to identify which of those procedures makes the best use of our technology in a clinical study that we can control and have a predictable outcome. But again, nonunions in trauma is a big challenge. [Presentation]

Carlos is a trauma surgeon in Northern New Jersey. Chief of trauma services there, so his thoughts on that--on his usage. I am also asked quite often, How do we work with our customers? How do they get educated? What does the training cycle look like? So a lot of times, there's an initial meeting. They may reach out to us. We may have a sales rep who knocks on their door to talk about the product. It may be in the OR. It may be at a general conference or meeting. And so from there, we're assessing what their interest level is, but also what their understanding of different bone grafts because it's our -- we believe it's our purpose and our mission to really have a scientific foundational sale to the surgeons so they truly understand the mechanism, how it works. Many surgeons may come through fellowship and the biology of bone growth is probably a course they had many, many years ago, not something that's constantly reiterated, especially early in their practice. So we set a foundation. So we have these what we call KICS events, Kuros Insight Exchange meetings. And this is where we bring a small group of users together to have people who are users, people who are not users. So the surgeons can talk to each other about how they use the product, why they don't use the product, what is the clinical evidence state. And for us, we just create the room in the community, and we let the physicians take the ownership of the message. And that's been very, very impactful because we always learn something. By sitting in the room and watching them teach each other, we're always picking up something. And that may be for marketing materials. It might be for future product development. We also have meet the expert in journal clubs. Often, when you have fellowships and you have residents, our PhDs and our medical staff will go in and teach osteoimmunology to a group of fellows and a group of residents. They are doing this on a weekly basis around the country at all times around the globe. We have a team also based in Europe. And so again, foundationally, this is who we are. We also work with scientific symposia, also other courses that we get invited to attend, have sponsored physicians to go up and talk about the public studies. This is, again, a much larger audience environment. And then lastly, we do what's called VIP visionaries. People who have excelled with using the product, have great results, want to share those results with us as a company. But also we want to seek their opinion on things we're working on in the lab. And so we'll bring them to a headquarters, and we'll say, look, these are the secret projects that no one else gets to see. Do you think this is a good product for us to develop? How would you change it? Because it's always very important to ensure that our clinical community is engaged and involved in the development of technologies. We believe that's our way forward. And so for instance, we just held one in our home office in the Netherlands just recently, where we hosted 6 surgeons, had multiple conversations about things that are coming out in the pipeline, also learned tips and tricks on how our current technology works. So a very helpful way. So when you look at the opportunities from an education, there's one for each size, and they each have a very specific purpose in training and educating our community. So this is kind of what we look like and how we market them. Again, they're able to get the latest updates on our products, our product development efforts, our clinical studies, where they're at. I would say we always get great feedback from the physicians saying that they -- how much they learned, and it's really the opposite. We learned such a great amount about our customers just by listening and haven't been putting them in a room. Here's a few quotes from some of the surgeons that have attended this. It's not -- the one on the lower right-hand corner, it's not a sales pitch. It's space to learn, share and grow. And they're building friendships and partnerships. You have surgeons who have never met each other from different parts of the country or different parts of the world, sharing their clinical experiences and then also building friendships. So that's also building a community around Kuros. So just a few highlights, 65 individual meetings with surgeons, 148 engaged journal clubs, we also sponsor fellowships for training and education and 5 different large conferences. [Presentation] So as I close this portion, and then I'll hand it over to Joost to talk about some of the innovation. The journey we're on, since I've been here, it's been almost 4 years, certainly a lot of accomplishments, a lot of financial accomplishments, a lot of operational product accomplishments, clinical accomplishments. But as you -- as we go through the rest of the day, what you'll gain is that we're just getting started. The foundation has just been set. And we believe that 2026 is our transitional foundational year to accelerate even beyond where we've been. So we're very, very excited about the rest of today and laying out the future for you. I want to say thank you for taking the time to visit us here in person for those folks online. Hopefully, I stayed in the frame shot enough for you or I should stay out more. But again, a great schedule for you here today, and thank you for attending. So with that, Joost?

Great. Thanks a lot, Chris. So again, also welcome from me. Let's change gears a little bit. What I will do in my next 20, 30 minutes is show you what makes Kuros unique and what is really differentiating us and our technology from the competition. In order to do that, let's first look at the regulatory pathway. So what is required, and this is related to the U.S. to get a product on the market and get a product used clinically. Here, we can see that at the bottom, human cell-based products, that is allograft, so there's donor bone or allograft with cells. Chris already mentioned that before. In order to get those products on the market, the evidence required is no animal or no human data is needed for that. So that relates to, again, CBAs, demineralized bone matrices, donor bone and also allografts. Then next to that, one level higher are the so-called Class II products, products like MagnetOs, other synthetics and also DBMs with carriers. They follow the so-called 510(k) pathway in order to get 510(k) clearance or FDA clearance. And the evidence required for those products is preclinical studies, animal studies. And in the spine, there, you need to do a posterolateral spine fusion model in a rabbit, very small animal. If you have done those studies and show that your product is similar, equivalent to an already existing bone graft, you can go ahead and start selling and marketing your product. And then the highest level of requirement from an FDA perspective are the so-called Class III products. Those are growth factors like InFuse, BMP and also peptides. And the evidence required there because they are more actively active components in those products, they will require robust level 1 clinical studies. Large cohorts of patients, often 100 to 200 patients with a control arm. So you have to compare the product to another product, the gold standard often, and that follows the so-called IDE trial. So again, for Class II products like MagnetOs, you would only need animal studies. However, we take it one step further. And you will not be surprised if you look at the number of Level 1 studies that are actually only required for the Class III products, growth factors and peptides, there is only a handful of Level 1 studies that have been performed. You can see that on this slide, the bottom 3 are the peptides and the growth factors. Those are required in order to get regulatory approval. But the other 2 and the top one, MagnetOs, there, you do not require a Level 1 study. However, we do it because we believe in the product, and we want to show to surgeons that this product actually is working, not just in a rabbit, but it's also working in humans. It's a busy slide. I realize that. But what you can see in the difficulty of cases with the peptides and the growth factors, they have been regulated mainly for interbody fusion, which means putting the product in a cage and then try to get fusion. That is a less difficult way to get a fusion or obtain a fusion in the spine, whereas for MagnetOs, we have done studies in the posterolateral spine. So that's the back of your spine, which is a more difficult area to get fusion. If you look at the success rate of these fusions at the bottom, product fusion line, you can see quite good fusion percentages with these growth factors and peptides compared to the control arm, which is patient-owned bone tissue. But at the top, let's focus to MagnetOs. There, after 1 year, we already saw 79% fusion with MagnetOs in a more difficult fusion area, posterolateral spine fusion compared to 47% of fusion with autograft. This is significantly different and MagnetOs is significantly better in fusion compared to autograft. That's never been shown before. So first of all, we are only one of the very few synthetics that have done Level 1 studies. Secondly, when we did that study, we've even shown superiority of MagnetOs over autograft. Then why is Level 1 so important? I already mentioned it several times. Well, there's different types of levels of studies, as you can see here, but it really matters for clinicians. It reduces bias because you do a large cohort of patients. You compare it to a control. Here, you compare it to autograft, the current gold standard in bone fusions. It supports stronger conclusions, and it actually builds surgeons confidence. So when we provide those studies and we perform those studies and show good efficacy, it really builds the confidence of these surgeons. Next to the study that I presented before, in the posterolateral spine fusion area that's already been published by the way, that was called the MAXA trial. You may remember that name. We are also performing several other Level 1 studies. And here are 3 mentioned. They are well underway, the PROOF study, the PRECISE study and the ASTRA study. PROOF is posterolateral spine fusion, where we compare MagnetOs, in this case, Easypack. The samples are, by the way, outside for you. Those are here that want to see that product, and we compare them to DBM or DBM fibers, so allograft donor bone tissue. PRECISE study, 100 patients included also posterolateral spine fusion, where we compare MagnetOs Flex Matrix, another iteration of our product to a cell-based allograft called Trinity Elite. And last but not least, as we went into or we mentioned that we're also going into foot and ankle areas, we are now in the process of the ASTRA trial. Chris also mentioned that, hindfoot & ankle fusion, where we compare MagnetOs Easypack Putty or MagnetOs Putty to autograft, again, the gold standard in foot and ankle. And you can see the enrollment. So we are actively enrolling patients in these studies. Next to these, we already have published or investigators have published quite a lot of other studies, mainly Level 3 or 4 studies. Those are retrospective studies because the prospective study, as you can imagine, a Level 1 study takes a lot of time to be completed. Those studies have been -- are shown on this slide. On the left, we have data on the anterior or interbody fusion, which is, again, a less challenging way of getting fusion. You see very good success rates after 1 year of implantation or after 1 year of surgery. And on the right, we also have several posterolateral spine fusion studies. One is the MAXA trial, as I mentioned, that has already been published with Dr. Kruyt, but also we have another study from Eskander, and I'll point to that a little bit later on in this presentation as well. So a lot of studies already been shown and being performed to show MagnetOs is indeed a very good bone graft to get spinal fusion. Also, we are not stopping here. We are continuing doing our clinical studies. Here are just a group of studies. All -- most of them are Level 1, Level 2. Only one is a Level 4, which is the ACDF on the top left of the slide. You can see large numbers of patients where we compare the product also with BMP 2, the market leader currently, targeting 156 patients in this trial. We are doing also studies in the craniomaxillofacial area. So everywhere in the skeleton, we are doing trials with MagnetOs. Scoliosis and also oncology. Chris mentioned that in oncology patients, you cannot use BMP or growth factors. And therefore, it's a very interesting opportunity for us to evaluate MagnetOs in this indication. Now fusion, I talk a lot about fusion and fusion percentages, but that's just one criterion for surgeons to evaluate success. You have fusion rate, so the percentage of fusion after 1 year or 2 years or 6 months. Also fusion mass is important. You can imagine if you have got a very tiny fusion that may not be very robust, and you can get failure of the fusion afterwards. And speed to fusion is another variable, which is very important. And all these 3 actually also relate to the failure of the hardware. And hardware failure, actually, we're also going to evaluate. Those are the rods and the screws that you place anyway in the spinal fusion. But first of all, let's look at fusion mass. So what does MagnetOs look like if you put that in a human or in a living animal. This is a study based on a preclinical study. So this is a sheep posterolateral spine fusion model where we implanted MagnetOs compared to autograft, the gold standard and 2 other competitor products. Here, the material was implanted for 3 months, and we looked at the volume of fusion. And what you see on this slide is that when we implanted products, it was all 10cc, 10 milliliter of products were implanted. With MagnetOs Putty, after 12 weeks of implantation, you can see robust fusion on the top right of this slide. So in gray is the fusion mass, and you see robust fusion with MagnetOs. The mass is only slightly decreasing from 10cc that was initially placed to 9.6cc after 12 weeks. Autograft, which is also known, is resorbing. Autograft is rapidly being resorbed by osteoclasts. And therefore, after 12 weeks in this model, the fusion mass went down from 10cc to 5.7 per cc. Whereas the other competitor products, NovaBone and Vitoss, you see the fusion mass has drastically reduced to about 3cc, also indicated by the gray levels on this slide. As mentioned, also the speed of fusion is very important. And Dr. Eskander has done a study where he looked at fusion rates of MagnetOs that was implanted in patients that had high risk. 67% of these patients had 2 or more comorbidities, meaning that either heart disease, obesity, respiratory disease or diabetes, all indications or all diseases that can affect negatively fusion. And he looked at the fusion percentage of MagnetOs in the patients before 6 months of implantation and after 6 months of implantation. And you can see on this slide that there is no significant difference between the before 6 months and after 6 months. And this means sort of take-home message here is fusion already was occurring before the 6 months of implantation side. So fusion starts very quickly at a very high level. And at later times, it just increases a little bit. But the speed to fusion, that's the result of this study is very fast in these patients with many comorbidities. Another study done by Dr. Justin Davies, he also looked at MagnetOs in high-risk patients and now in interbody fusion. So again, in the anterior area where cages were filled with the MagnetOs. The graph on the right shows the patient comorbidities. So 65% of the patients had obesity were either current or former smokers, smoking negatively affect fusion, diabetic or had prior lumbar surgery. All these patients showed, and this was between 12 and 14 months after they've been operated, 94.4% fusion rate. So tremendous success of Magnetos even in these patients that have many comorbidities and are usually difficult to fuse. But we are also taking it one step further and not just looking at fusion, but also we are now doing quite some studies where we look at biopsies, even biopsies from patients. And the reason for that is that the assessment of fusion is challenging. There are different ways to look at fusion. When a surgeon -- when a patient comes back to the surgeon, he can do an X-ray, he can do an MRI or a CT scan. And you can see on the graph here left, very simple. If you have a banana and you do an x-ray, an MRI or a CT scan, you can just see different things, and it all looks very difficult. Then next to that, there's also many patient variables. Patients' bone quality can differ, and that can also be seen in the x-rays or the MRI. So we believe that histology, so taking samples out or taking biopsies and doing real histology will really tell you what is happening. Is it really a fusion? Is there material still? Or is it all bone formation? And histology matters, and that is why I put this slide in. This is based again on the preclinical study that we did before, sheep posterolateral spine fusion. So between the 2 spines or transfers processes, we placed either autograft, MagnetOs or the 2 competitor products. And by 3D CT scans, you can see in gray the fusion mass. So it looks pretty good. Autograft looks very good. MagnetOs looks good. NovaBone, you can see some gray area. So surgeons can think, well, there's some fusion occurring and maybe that will continue and the same with Vitoss BA2X. However, when we performed histology on these samples, you can see that both autograft and MagnetOs indeed provide a great fusion between the 2 transfers processes. All the pink stuff that you can see here is bone. With MagnetOs, there's some black dots, which are still remnant MagnetOs, but there's a very good fusion. Whereas with NOvaBone and with Vitoss, you can see those 2 oval pieces of bone. Those are the transfer processes in between that, the implanted materials placed, but there is no signs of bone formation. So what you see on the CT scan is not bone, it's remnant material. And these are just some examples, and we also present this to the surgeons where they realize, some of them, by the way, already realized, but that just looking at a CT scan or an MRI or an X-ray and you see density or opacity doesn't always mean that there's bone there. So again, as I said, we are taking this even one step further. And here, I have got 2 case presentations, one from Dr. Todd Allen, and he did an implantation in a patient that had scoliosis, which is a bent spine, as you can see on the preoperative x-ray. And then he treated that patient by straightening the spine with metalware and then he implanted MagnetOs at one side of the spine and BMP at the other side of the spine. The patient then this was after about 22 months after surgery, came back to the surgeon and he had muscle spasms. You can see that here at the back of this patient, there was muscle spasms, most likely because of the hardware, because of the metal that was placed in the spine. So he had to do a reoperation to remove the hardware, to remove the metal. And here, you can see what he found. So this is the site where MagnetOs had been placed, and this is a little movie and you can hear him ticking. This is after, again, 22 months of surgery. You can see him ticking and see that it's actually bone. So Magnetos was implanted and a 22-month robust bone was formed. When he was doing this and when he was removing the hardware, he could also take a biopsy. So he can take a little piece of tissue out and process that for histology. And there, the results are shown on the left -- on the -- sorry, on the right. On the left, you can see the metalware that is implanted and the area where the MagnetOs was placed. MagnetOs biopsy was taken away from the existing bone. So really where MagnetOs was more in contact with muscle. And on the right, you can see the outcome. Basically, what is pink is all bone. You can see some remnants with G. There's a remnant MagnetOs particles. Very few particles are still there, but robust bone formation and robust fusion. And this is just one example of showing not just doing the Level 1 trials or doing CT scans or x-rays, but actually doing histology and showing that MagnetOs works. Another case study was done by Faheem Sandhu. This was a 65-year-old male that had quite a lot of comorbidities. He had severe back pain, was wheelchair dependent and he had to be operated. And you can see here that also rods and screws were placed and next to those rods and screws also 20cc of MagnetOs was implanted as a stand-alone. This is what the results were after, I think, about a year of implantation, a patient came back to him he had severe pain, most likely again because of the hardware, hardware that was irritating the surrounding tissues. This is then what he did. He had to reoperate the patient to remove the hardware and then, of course, hope that the MagnetOs had provided solid fusion. Normally, initially hardware provide fusion, rods and screws and then your bone graft has to take over. So he had to remove the hardware. And now also here, you can see. And you can hear where he placed the MagnetOs, solid bone formation. Also here, this is a higher magnification. I apologize, but we are still before lunch. So maybe a little bit bloody. But you see here the area where the screw was taken out, as you see on the bottom, that round area here. And on top of that, the more granular stuff is where MagnetOs was implanted. He took a biopsy, and this is the outcome. So you see different magnifications here. The lighter areas is MagnetOs and the pink areas is bone. So MagnetOs is completely engulfed in bone tissue in this patient, and this is elderly patients with many comorbidities. So again, these are just some examples showing how we differentiate Kuros from the competition. We are doing Level 1 studies. Our competitors that have synthetic products don't do that because they don't have to do that. They can just get animal data, sheep posterolateral spine -- sorry, rabbit posterolateral spine fusion model and they start selling. We are investing in Level 1 studies. Then we're also doing CT scans, x-rays to evaluate fusion, but now we've even taken it one step further by looking at histology. And currently, we have 7 of these case studies, and we are trying to get more in, of course, to really show and to really show to the surgeons as well that it's not just a material that is left over if they see that in CT scan, but actually it is real bone formed. And I think that was my last slide. So I would like to move over to Joe.

Thank you, Joost. Good morning. It's a true pleasure to be able to spend a few minutes to talk a little bit further about the product engine within Kuros. We will move to a break after my section, so I kind of win there. And I also promised I'm the last bald presenter. So over the years, Kuros has been a true product engine based on the work that Joost began really 30 years ago in his career. We continue to do that. We invest very significantly in product development. Those product developments are informed by a lot of research on our side and then also a lot of voice of customer from surgeons from our salespeople from the market and ongoing. An example of that is this quote from Dr. Justin Davis. He's at the University of Kansas Medical Center in the middle of the United States. And he commented on the newly -- recently launched MagnetOs MIS delivery system. He said Kuros Biosciences has nailed it with the MIS gun technology. I apologize for the American terminology. It maximizes grafting coverage in the disc space for my patients that need a minimally invasive TLIF and eliminates the need for traditional grafting funnels. As you may have heard in previous conversations, Kuros has invested in, pursued and achieved very broad indications. Now these are U.S. indications, but it's very similar to the indications that we enjoy in Europe and around the world. So we have very broad indications across all MagnetOs formulations. You can see the new ones on the left for the MagnetOs MIS delivery system, where we have already clearance for posterolateral spine, intervertebral disc and pelvic and extremities. You might notice under Flex matrix that for pelvic and extremities, we are not yet FDA cleared. That is currently in process, and I would anticipate that this chart will change in the not-too-distant future. But this really allows us to not just have the indications and market the indications, but we can educate and discuss these indications with surgeons where for our competition, if they are limited in their ability to have a conversation, they just can't educate, they can't have the conversation and they have to stay in their lane with regard to their indication. So this is a true competitive advantage for Kuros. From a product development standpoint, we always start with an unmet clinical need that's been communicated to us. For this example, we will continue to talk about the MagnetOs MIS delivery system. And so we had surgeon customers come to us and say, "I need a way to deliver MagnetOs in my minimally invasive spine surgery procedures. We had no true great solution. So when we get feedback like that, we do research, we get voice of customer. We identify whether or not we think there's a market opportunity for us to develop a differentiated technology within Kuros. The answer is yes. We activate that project. We develop prototypes. We test them internally. We then go out and we validate what we think is an advantageous product. We do a lot of cadaveric work with surgeons in laboratories. We get feedback from our internal team. We get feedback from our distributors. And if we think that we've landed on something that is really going to have a market advantage, we pursue a 510(k) clearance in the United States as well as EU clearance through MDD or MDR. Once we have that and we launch the product, then we do another feedback loop and we revalidate whether or not what we thought going into 510(k) clearance was true in a post-commercial environment. So really, it's 3 very basic steps: identify the need, in this case, access, develop something, the MIS delivery system and then create it and provide it commercially. So just briefly, what is minimally invasive spine surgery. So traditional open spine surgery and similar to some of the images that Joost shared intraoperatively, an open procedure starts with a long longitudinal incision down the spine. The soft tissues are stripped away from the bony elements, allowing the surgeon to visualize the bones of the spine. It provides really not just visualization, but good access for the application of bone grafts. And they don't need anything -- any special tools to really do that. They can use the basic putties or other formulations to lay it down. However, for minimally invasive surgery on the right, it's usually 2 stab incisions left and right. Most of the soft tissues are left in place and the surgery is performed usually through some type of tubular access. So that limits visibility. It limits the opportunity to deliver the bone graft and you need some solution for that. Now the benefits are probably relatively obvious for minimally invasive surgery if performed properly, less blood loss, reduced muscle damage, reduced risk of infection, less postoperative pain, faster recovery and better cosmesis, which you would expect. So this is the product that resulted from the development. So the MagnetOs MIS delivery system is the only MIS delivery system that is offered sterile, prefilled with the graft in the package. It contains no human tissue, and it's a graft solution that is backed by Level 1 clinical evidence. All of that while allowing the surgeon to achieve placement of the graft in about 1/3 of the time of traditional funnels. So we've had a really great response to this launch. [Presentation]

That was, again you may have seen Dr. Brandon Lawrence from the University of Utah in Salt Lake City. So a couple of more examples. I won't go through this slide in detail. But the next example is the generation 2 of that same device. And during development of the product, we received feedback that said, I would really love to have an even more precise way to deliver MagnetOs when I'm doing my surgeries. So the unmet need is precision. The development focus was to identify ways to improve the placement and the accuracy and the outcome is going to be a generation 2 of this device. The current device is on the left. And on the right, you can see that we've developed some very -- a couple of tips that will provide very precise placement of the MagnetOs graft. It's a rectangular one, an conical one for different applications. We feel that this solution will be very good for both spine and extremities. This formulation uses smaller MagnetOs granules. That allows -- that will allow MagnetOs to be placed in smaller defects, but also will improve the flow of the product through these smaller tips. And then on the delivery system itself, we've added some markings for the surgeon to have a more accurate understanding of exactly how much graft that they placed. So there's improvements not just with the tips, but with the delivery system itself. And we expect that this to be available to physicians beginning in the first half of 2027. These are just some pictures and examples. So these are from like the voice-of-customer labs that we were doing. The X-ray photos that you can see, you can see the tip on the X-ray and it's adjacent to the back of an intervertebral cage, and they're using the tip to engage the cage and inject MagnetOs into the cage that has been implanted and expanded. So that was a voice-of-customer validation lab. Next example is Flex Matrix. So we had a number of pieces of feedback that surgeons wanted different and larger sizes of Flex Matrix. This required a lot of feedback from our physician users because every surgeon will have a very slight variation of their own opinion. So it was a lot of voice-of-customer, a lot of research to kind of land on what we wanted to bring forward to market. So we had to determine the best options for sizing specific to posterolateral fusion, and we landed on 3 sizes. So picture on the left looks a lot like our other formulations, but the one on the far left is actually twice as thick as any other geometry of Flex Matrix that we currently offer, then we also have an extra long and we have an extra wide. So at the end of the day, you have more sizes, more possibilities, more flexibility from a surgical standpoint. The picture on the left is just a particular technique that one surgeon likes to use and wrap MagnetOs around another form of bone graft. Not every surgeon does that. It's unique to him, which led him to give us the feedback that he wanted additional sizes. Those will be available beginning before the end of this year. So those are very close. So what's next? So there's a lot on this slide, but this table represents a continuum of bone graft categories from left to right. So on the far left, regenerative bone grafts. On the right -- far right, polymethyl methacrylate, bone cement. And in between, there are variations of resorbable settable bone void fillers. Each of these categories has their own attributes. They have their own primary applications. You can see product examples on the bottom row. The MagnetOs, the entire MagnetOs family is in that left column. Kuros is interested in pursuing those middle 3 columns, the resorbable settable bone void fillers. Those 3 columns are represented in these boxes. So these market opportunities are substantial. They're also growing quickly, and they're very high interest to us as we move forward. The first column, regenerative bone void filler, you can consider that an active project within Kuros. The middle column, antibiotic-eluting bone void filler. Imagine that as a recurrent research project within R&D. And then the last space, antibiotic beads or other type of dead space management, that's more ideation consideration for future R&D. So the opportunity for these resorbable settable bone void fillers is very significant. Again, this is U.S. data. I apologize that so much of the data is U.S. focused. We are working to get more discrete data for the international markets. You can imagine the variability on what data is collected and what's available, but we are looking to get a more discrete global view. But even in the U.S., just in 2026, over 600,000 procedures are potentially available for these technologies in both lower extremities and upper extremities and the opportunity continues to grow over time. So overall, in the near term, we expect to continue to develop and launch the technologies that I've mentioned. So the MagnetOs MIS delivery system Generation 2, we anticipate it will be just simply MagnetOs MIS Precision, the additional sizes for Flex Matrix and a resorbable settable bone void filler. Longer term, in the midterm, resorbable settable bone void filler with an antibiotic solution and then other organic developments that may include dead space management or osteopromotive platforms, including surface technologies that didn't really talk about in detail today, but they've been mentioned in previous meetings. And then long term, we have a very active and ongoing strategic view of what we may intend to pursue both organically and inorganically to add to the portfolio going forward. And with that, everyone gets a break. Thank you. [Break]

Okay. Welcome back. So you've heard the high-level strategy from the Kuros leadership team. Next up, we will invite Mr. Golberg, who is going to give us that deep dive into foot and ankle, talk through the procedures that he does and how MagnetOs has impacted his practice, and then we'll end this session with our patient video from Alison. Over to you, Mr. Golberg.

Thank you. Thank you very much for having me and for, and thank you to Kuros for inviting me. So my name is Andy Golberg, and I'm an orthopedic foot and ankle surgeon based in London. And today, we're going to go through everything from the unmet need right the way through to the clinical value proposition. And I think probably the best thing I can do, and apologies for walking around like Chris, but tell you a personal story that kind of exemplifies the unmet need and how I got into this space. So about 30 years ago, I wasn't always going to be a foot and ankle surgeon. I was kind of -- I did a thesis looking at stem cells, trying to convert blood into cartilage and bone, very much like. So I was in that space, and I had a car crash. And so I was off work for way over 2 years. I messed up my back and ended up becoming a spinal patient. And I had 7 operations over those 2 years, and it culminated in a spinal fusion, a posterolateral fusion. So I'm actually not standing here necessarily just as a clinician, but also as a patient that's been in this situation. And what was interesting is my spinal fusion didn't unite. So I got a nonunion of my spinal fusion. And 10 years after my surgery, I found a letter that I wrote to the surgeon, presumably high on Morphine in the day after the surgery. I was at home. I recovered. I was back in a bed in my home, and I've written this letter, which I only saw 10 years later because I became a consultant orthopedic surgeon at the Royal National Orthopedic Hospital, Europe's biggest orthopedic hospital. And I was a consultant. I've got my old notes. This is going back some time about 15 years ago, and we had old notes, proper notes, not electronic ones in those days. And I opened up the notes to find a letter from me in handwriting. And it said, dear surgeon, I'm home and I've got this corset on and it's great and it's stopping me moving, but it's not stopping me rotating and twisting at night. Patients have great insights. Patients see a lot more. That's why it's all for me about the patient because patients see things that we don't necessarily see. And I wrote in this letter, I said, could it be that this rotation I'm doing tossing and turning uncomfortable every night is going to create motion at my spinal fusion and it's not going to knit. And that's all I wrote this letter and I sent off. I don't think he ever saw it. I think it was filed in the notes and sat there for 10 years until I found it. But it gave me the sort of insight that, a, nonunion of a bone is a real big problem, major problem. 4% of people that have a spinal problem keeping them off work for more than a year, ever get back to work. So I was in a tiny little category, maybe never getting back to work. And when I eventually did get back to work, I had to decide what was I going to be? And although I did all my thesis on stem cells and knees, I decided I was going to do foot and ankle because I could sit down. That was my sort of logic. And at the time, foot and ankle surgery was in its infancy. It was a tiny specialty. There was a handful of people doing it. I figured I could kind of contribute to an area that was small and growing. Weirdly enough, over the last 20 years, it's grown faster than any other specialty. And foot and ankle surgery now is one of the hardest specialties to get into as a training doctor. It's growing at a pace that's far outreaching the growth in spine and growth in trauma. And so I think foot and ankle is really a huge bulging opportunity. And it's particularly unique, okay? Because if you think of going to an engineer, there's 30 joints in the foot, 28 bones, 30 joints. And if you go to an engineer and said, design me something that is completely adaptable that you could stand on uneven surface on rocks and position yourself. But then when you push off, jump, hop or skip, it's completely rigid. The engineer would say to you, well, you could have mobile or you can have rigid, you can't have both. But someone whoever invented us has managed to create a structure that's exactly that. We can place our foot in any structure wherever we want, it's completely mobile. And yet when we want to push off, it becomes rigid, and that's because of clever design of the bones. They're often saddle shaped bones, muscles, tendons and all of the other things that pull together. So what we know is it's an amazing structure, but also that if you fuse one of those joints, it doesn't limit your function because like the spine, there's lots of different spinal levels, you fuse one of them, you still can do and even with a nonunion, I can still do much of the things that I'd love to do. But the foot and ankle is very similar to the spine because you can fuse one of the areas and still have amazing function. So if people get arthritis and about 1 in 2 people over the age of 65 get arthritis in their lifetime, the 2 treatments, once you've tried everything else in pain killers to nonoperative measures, the 2 treatments are either to replace the joint, and we can now replace the ankle joint, and that's something that I do a lot of, or we fuse the joints. And because you can still have excellent function because partly fusion is an important part of the foot and ankle, actually, it's a very common operation in the foot and ankle. But it's uniquely challenging, similar to the spine, okay, because of rotation, because of motion. It's, in fact, more challenging than the spine because it's an end organ. So if you think of the spine, there's lots of blood supply coming all the way around from everywhere, whereas the foot has an end organ structure. So it's got limited blood supply. So it's a particular challenge to get bones to knit when they haven't got as good a blood supply as anywhere else in the body. And because you're having to move, you can't be non-weight bearing. You have to sort of put weight on it. So there's lots of motion that's required. So it's a challenging area to try and get to unite. And we, like all specialists, have these patients that are difficult, smokers, diabetics and revision surgery or people that have a metabolic issue like a low vitamin D. And in those patients, the nonunion rates can be as high as 40%. And so that is a major problem. And it's a major economic burden as well because GBP 1 in almost every GBP 125 of public spending in the National Health Service in the U.K. is spent on things like diabetic foot. It's a big problem. And in terms of what's out there for us to treat that, well, we usually use autograft, and that involves telling the patient we're going to make a cut somewhere around their pelvis here, take a piece of their hip, which will leave a defect. Most patients complain a lot more of the pain they get here than they do for the surgery that we do on their foot. So autograft is not an ideal scenario. It carries donor-site morbidity. And it's only osteoconductive because it's effectively dead bone when you take it from one to the other. And so there's a lack of solutions to deal with our high-risk patients. And as has already been said this morning, the market is increasingly growing. It's a big market, but growing at a rate much greater than many of the other specialties. And what's really important as a clinician is the evidence behind it. And that's what sort of drawn me to being an interest. I run a national -- it's called the NIHR, the National Institute of Health Research, a grant for a large study comparing fusion, which is an ankle fusion against ankle replacement. So that's a study that's publicly funded over $3 million. So I have a huge interest in this as an area. So when I saw a Level 1 equivalent study in the spine, clearly, that got me excited. And it's very rare for a company to present to you Level 1 data when you're looking at this as an area. So I don't think spine and foot and ankle differ. I've already said to you that I think the notion of fusing 2 bones with a gap in between the irregular uneven surfaces are very similar in the spine. In terms of the mechanism of action, well, it's clearly the same no matter where in the body it is. What particularly excited me on this because I've got a very shallow mind is the notion that it was conceived through innovation, okay? So some calcium phosphate material was put into an autoclave and it changed the surface topography to make it -- have this -- what's now known as needle grip technology. And that, for me, looked very much like kryptonite in the Superman film. So it kind of got me excited. But what was interesting is that changed the immune response and the way that the body responded to that material. And from a foot and ankle and spine perspective, we've already said that the patients are the same, the demand is the same. And for me, well, it's very clearly that it's a catastrophic of response for getting nonunion. But we don't have that data in the foot and ankle space yet. But what I was most excited about was the notion that we're going to get that data. And it's harder to do a Level 1 study. As I said, I'm doing a study of ankle fusion against ankle replacement that's comparing motion against fixations. That's a very different study. But there's 200 operations that we do in foot and ankle, everything from Achilles problems to torn ligaments to arthritis to cartilage defects to instability. So it's very difficult to run a study when you've got 200 operations. That's partly the reason I like foot and ankle is that I don't have to do 10 hip replacements or 10 knee replacements on an operating list. I get to do lots of different things every day. But studies are now coming out and the ASTRA study and all the others that are there are going to generate the similar evidence in foot and ankle. And again, that for me is very exciting. But we're at early stage. This is sort of an early stage for us as clinicians and exciting to work with the company because there's 200 potential products on our procurement that we could use as bone graft substitutes. I think it's 170 when we last looked. We counted 170. And it's very difficult as a clinician to be able to differentiate with the 2. So the one thing that we want to know is data. We want scientific meaningful data. And I think that's where it's been exciting working with Kuros. I'm going to give you some examples from my personal early experience. So this is why I was saying to you about arthritis of the ankle. -- it -- unlike hip and knee arthritis, it's not necessarily in your genes. It typically follows trauma. So if you break your ankle or sprain your ankle repeatedly, over a period of 10 to 20 years, your ankle tends to wear away and you end up with bone rubbing on bone. And that hurts, okay? And you can't go make a cup of tea. Studies have shown that the effects on your quality of life when your bone is rubbing against bone is the same as end-stage heart failure and end-stage kidney failure. So it's a big problem. And so the typical treatment that we would use is to either replace that joint or convert it to a stiff but painless joint. So you're taking a stiff painful joint and making it a stiff painless one. And so in this case, the treatment that was decided was an ankle fusion which is to make a stiff painless joint. We have to join the 2 bones together, and we tend to do that with some screws or plates as shown. And then because it's a space where there's uneven space, there's like a big gap on either side, we want to fill those voids. And so you would put in there some graft either again, autograft or you'd use something like a synthetic graft. And in this situation, I put in MagnetOs and was very assured that later on, what you could see as a gap there before is now filled in. What we're looking to do is to make all of this structure one structure. At that point, the metal work becomes obsolete. It's no longer needed. You could take it out if you wanted to. So there's a very example of a successful fusion augmented by a technology that as a surgeon, we want to get fusion at the end of it. from our study that we did, about 12% of patients didn't get union based on an x-ray at 1 year post surgery. So 12%. That's quite a big number given that in the U.K. alone, there's about 2,500 fusion procedures done a year. 10% of that is a large number that then need to have another operation. I'll give you a second example now, and I think this is the great thing about foot and ankle. So this is a guy that came to see me with ankle instability. His ankle needed an operation to stabilize his ligaments. But when we did his scan, we found an incidental finding of a huge cyst sitting in the bone, his heal bone. And you can see it's a big hole that's sitting there, known as an intraosseous ganglion cyst. -- just like a ganglion you get on your wrist. And the bone around it was thin like an egg shell. So we discussed it in a multidisciplinary meeting, which is what we typically discuss, discussed it with the patient and said, we could just do your ligament repair, but you've got this huge cyst there. It's probably okay to leave it. But if it did crush, you'd have a catastrophic failure. It would crush and you'd end up having a major proper operation. And we've got the opportunity of dealing with it at the same time, and he very much insisted that we would go away and fix this. So what we did, this forgive me if anyone, again, before lunch, this is the side of his foot, and this is his heel that you're seeing there. There's a cut. And what we've done is made a small window into the bone, taken out that window and then there's the cavity and you clear out the cyst, remove it all and then place into that cyst the MagnetOs, filling the hole and then you put the window back on. and that then looks like the end result, repaired his ligaments and finished. And this is the radiograph taken just shortly afterwards showing that the defect is completely filled. And he's just recently, in fact, last week, I saw him in the clinic having had a CT scan showing that, that is now starting to look like it's turning into bone for me, a successful outcome in a patient that otherwise potentially could have a catastrophic result. I think this is interesting is that, as I said, there's 170 on the market of products that we could use. There's lots of commercial reasons and arguments that the procurement people in the hospital will use in order to justify why we should use a bone graft or a bone graft substitute. And so we have lots of reasons to do that. What -- the question is, how do you differentiate between one and the other. And this is where adoption of one over the other typically happens. And I spent a lot of my life working on in the innovation space, watching how clinicians adopt new technologies. And typically, they can take 20 years for new technologies to change amongst clinicians because it's a very slow burn, it's word of mouth. Probably the best example of that is if anyone's ever had pins put through their legs, so known as the Ilizarov technique. This was started 30 years ago by a surgeon who had come from Russia, but was living in the States and developed a technique and slowly, it took 30 years to become mainstream. If anyone's ever had club foot, Ponseti, the very quiet, quietly spoken surgeon didn't shout loudly about a technique that he used to avoid surgery in babies with club feet. And the Ponseti method took 27 years to become standard to stop operating on babies because he was quiet. So innovation is slow in health care. But there are ways in which you can speed up that innovation, okay? And that means clinicians supported by industry experts who potentially can actually help the clinicians with the tools that they're missing. And in this case, it's the clinical evidence. And so as clinicians, we have networks. BOFAS stands for the British Orthopedic Foot and Ankle Society. When I started, there was less than 100 members. Now it's the biggest orthopedic meeting in the U.K. That's bigger than spines, bigger than knees and hips. It's 660 people at the last meeting. So it's a very big influential organization. EFAS in Europe is the European Foot and Ankle Society, again, a huge organization. In America, there's the American Academy of Foot and Ankle Surgeons. And those organizations will often use meetings where you have hundreds, if not thousands of delegates and surgeons standing up giving examples of their cases are hugely influential on other surgeons. And the programs that we've heard about this morning, I think, are really exciting for us as clinicians because we like to go and talk about cases. We like to talk about with each other. What we don't like to do is necessarily go to a company's meeting. And so what was clever again about what Kuros has done is that they've provided just a platform for clinicians to share and discuss knowledge on issues, complex problems that we have as clinicians. And in particular, there's not a lot out there for the biology of how bones knit, both in terms of us knowing it as education, we don't get taught that as medical students or as junior doctors. And also when you're in practice, when you're -- as I said, you're using it and you're faced with 170 on the procurement, which ones you choose. And clinicians are also very influential in their procurement decisions. The hospitals don't like to think so. But if a clinician says, I need to use this product, then it's far more likely that the procurement people are going to influence that introduction. So clinicians are probably the single most important variable in any procurement decision is the clinician. And clinicians are hugely and only influenced in outcomes. So they want to see outcomes. They want to see data, and then they will then naturally down the line, influence the people that are going to make the economic case. So in summary, the problem is clearly real and growing. It's a big problem and foot and ankle is, I think, one of the most exciting areas to get into. And it was interesting watching Chris at the beginning talking about those spaces. I met -- Sir James Black, who is the inventor of beta-blockers and subsequently H2 antagonists, probably 2007, and I had dinner with him. And I was probably the last person to meet him because he died shortly afterwards, unfortunately, not after my dinner, but later that year. And the reason it was interesting is that he was talking about how it would be almost impossible for him to have ever invented the things he did in industry now. He worked for ICI, which subsequently became Glaxo, but it would be almost impossible because people don't like taking risks. They don't like doing the early-stage innovation stuff. They want big commercial cases. And weirdly enough, when he made beta-blockers and he went back with his idea for H2 antagonists, the commercial guys in the company did the business case and said that his market was about $10 million. It was too small. But because it was James Black, they'll put him in a room and let him just play with it, just let him keep quiet. And he told me this story. And he said, H2 antagonists outsold beta-blockers in their first year, even though the business case didn't support him. And then he left me with something that will stay with me for the rest of my life. He is -- and he's Scottish, a strong Scottish accent, which I can't do. He said, Andy, if you make something and it works, it will sell. And I think that was the message that I took away is that if something works, it will sell. So if a company focuses on the clinical evidence and focuses on the unmet need, it's irrelevant. Even if the market is small, it's going to grow and you're going to sell. And I think that's -- again, the analogy here is that Kuros is spending a lot of effort on producing the requisite evidence, which is the foundation, if you like, for massive market growth. And there's no real dominant player in this market. All the players tend to be large players who have huge portfolios, but they've got very, very, very little knowledge in the biologics space. And I'm amazed when I'm working with probably the largest orthopedic company in the world by far, how the guys that I'm talking to can't even talk about biologics because their biologics is a different division, someone else that I have no relationship with gets involved. And so -- and they don't even have any training themselves on their biologics. So being specialized in biologics and the ability to speak to clinicians, I think, is something that's potentially a game changer. We've got good evidence. We've talked about that. And for me, the early signals are consistent. In other words, if the outcomes weren't providing the outcomes that I'd like to see, then I wouldn't be standing here today. But because the early signals are consistent, I think it's very much along a trajectory that's going to lead to a positive outcome. And the timing is right. We still don't have approvals for certain ideas. There are some things further down the line that are even more exciting that excite me of where this potentially can go. And so this is a quote that I said, but for me, it's really simple is the biological rationale was strong. The early clinical results were consistent for me to continue to use it. And I think -- I'd like to think I'm representative of how most clinicians evaluate new technologies in the same sort of way. More importantly, we do it all because we're looking after patients. And so whilst I am historically an expert patient, I think the most important person that I can introduce now is a patient that's had treatment and her perspective, I think, is going to be very important. [Presentation]

There you go, the last word to the patient. Thank you very much.

Thank you very much, Mr. Golberg. That was very insightful and really nice to see a patient perspective. Next up, we'll invite Daniel to the stage. Thanks, Daniel.

Thank you. So before we start, as you know, I'm the CFO. I will name out some numbers because my presentation will not be a lot about numbers. But I think one number which is really crucial and was a cornerstone for us is that we have grown almost 1,300%, right, since 2022. And the other number, which is astonishing is that we have only grown in fixed cost by about 400%, which basically allowed us in the end to now become cash flow break-even in H2 '24 and actually also allowed us to reach profitability end of 2025. What that means is basically that we can fund our organic growth path with our own means. We have now basically spent in '26, almost $15 million to $16 million in CapEx. We spent about 6% in net working capital. And we spent another 4% to 5% in engineering, operations, regulatory affairs. So all of this obviously costs us money. But what is important is actually that you understand the volume growth we have seen, right? And the volume growth when I started here was hitting an organization which was super manual. It was actually labor intense. And the only way how we could deal with scale and volume was basically to further hire people, right? So what we initially did was really first to focus on are the right functions in the organization. So we started to build on Investor Relations, started to bring in treasury tax. And since '25, we now started to focus more on the back end of the organization. And the business model transformation we have gone through, we divided into 3 dimensions: functional, structural digital. So if you look at the functional investments we did in '25, we actually heavily invested into IT because IT governance, IT security is obviously super important. But at the same time, we obviously wanted also to digitize our value chain. That was very important for us to basically first start with that initiative. We also implemented the enterprise risk management, just to understand where our risks are from a target operating model to actually achieve the vision which Chris and Joost already outlined. What we then did, obviously was structural adaptation. So we worked on a dual production footprint that we are not just producing in the Netherlands, but also can expand to the U.S. and get closer to our home market. As you know, about 97% or 96% of our revenue is generated in the U.S. And the closer we get to the home market, the less transportation costs we'll have, the less sourcing costs we'll have, that helps us at the end of the day on the bottom line. What we also did, and we started with that already earlier on, thanks to the enterprise risk management, we anticipated actually that there might be tariffs coming. So we basically implemented a 3-layer approach. We first stockpiled which basically helped us to hedge against the tariffs up to September '25. Then we basically did further invest into additional structural impacts, which was the so-called first sale method. The first sale method actually helped us to structure the supply chain instead of from the Netherlands to the U.S. directly, we basically went through Switzerland and then to the U.S. And this created the chain transaction. The first sale basically dictates the import price, helped us again to lower tariffs and basically hedge the company from that end. And then last but not least, and this is also the video I've seen, we have now opened up in Alpharetta, our new production site and also our new commercial headquarter. The office people have started to already see what the benefits are also from a knowledge sharing perspective because there's a much higher daily interaction between the employees. But also in the long run, this production facility will also help us to have the production capacity available we need for 2028 and beyond. Up to 2027, we are more or less covered in the Netherlands that has been secured already earlier on where we doubled twice the production capacity in the Netherlands. But beyond that, the U.S. would then take over. Last but not least, and as said, from a digital perspective, it's important that we can obviously increase productivity because we cannot just hire people. We also need to work on the workflows. We need to automate the workflows. We need to increase the efficiency, right? And what we looked at is from a purchase-to-pay perspective, how can we better automate this workflow and how can we also automate the whole supply chain and the whole production. And what we did there is basically implement so-called ERP enterprise resource planning system and also material resource planning system. And basically, we have that now live in the Netherlands. We'll now start to focus this MRP so-called also in the U.S. And in '26, we have now started to focus more on the front end. So what we're going to do in the U.S. is basically that we will now further adapt the tax structure to the U.S. setup and basically see how we can further benefit from that new structure. And at the same time, obviously, we will also invest further into front-end automation, digitize the back end with the front end that we have full data visibility and can use business intelligence to basically further scale the business. So if you look at where we are today, we are almost there. We have now a global supply chain setup, which helps us in several ways. So we are now obviously much more resilient -- we have a global scalable supply chain. It helps us to reduce the transportation cost from the Netherlands to the U.S. It will help us to lower the tariff because in the end, we produce local for local in essence. And it will also help us to further optimize the plant, source, make and deliver. And that's really crucial that we're going to see that over the next years. The way we do that is basically that in '26, we now have set the foundation stage, which basically means that we have now the ERP in place, we have the MRP in place. We have the U.S. site in place, and we have the Dutch new site in place. We also have just an opening of the new Dutch site last week or actually this week. Then we're going to go into an emerging stage where the U.S. will ramp up. The Netherlands will continue to be a global supply hub, and we will continue to use the ERP to further enhance efficiencies. And then last but not least, in '28, we will then see this localized manufacturing footprint, which actually helps us to further save cost as well, obviously, to increase the EBITDA margin. In terms of the MRP, just to give you some deep dive, the MRP in the end basically is a control center for us, right? So it helps us from raw material through the semi-finished product through the finished product to trace the SKU with bill of material and cost conversion to the end product. And that also helps us to understand cost deviation from a price perspective, from a volume perspective as well as from a mix perspective. And that, again, connecting the dots helps us basically to identify yield, understand what is the root cause, further optimize workflows and then actually reduce costs as a result of that. And what that means from an operational benefit is we have more flexible production. We can adapt to market needs much faster. We also heard that just about 35,000 square feet are currently used. We will have further potential in the U.S. to further develop products there. And that's why we need to invest now in order to basically create this target addressable market in the future, which helps us to further grow and actually also increase our margin. And from a financial benefit, as I said, basically helps us also to increase productivity, increase the bottom line to achieve that. The other deep dive is basically the front end, I said, we're going to digitize the front end now. That's the next project we are working on. And then we basically have a full end-to-end value chain digitization, which, in essence, means that we can then basically understand from the market what needs to be produced in the Netherlands or in the U.S. in order to basically then satisfy this demand. And it also helps us obviously to increase the cash collection cycle. We will have a much better capital allocation because currently on the balance sheet, we have a month forward coverage of about 4 to 6 months, which is obviously quite costly, as you can imagine. And what this new setup will allow us in combination with the material resource planning is that we can much better allocate basically capital to net working capital, but also to CapEx in the foreseeable future. So to sum it up, we are now almost done with the foundational investments. So we have now up to '26 where basically all should be set in stone. The platform is then built in order to push through scale and then actually use the operational leverage to further increase the EBITDA margin. That's basically the game plan. We obviously will increase scale through strategic alliance as with Medtronic national contracts, but also we will increase TAM as Joe presented through new product development, and we will also go into new indications to further increase the growth. And by doing that, we will actually see further reduction of the operational cost by increasing basically economies of scale and increasing the operating leverage. The way we can do that from a cost structure perspective is that we will further lower the sales and marketing costs, we will further lower the G&A cost and we'll keep the R&D cost at the level needed in order to provide that evidence we need to grow. And last but not least, and we just reconfirm our guidance for '26. We are very confident that we're going to achieve that. As you have seen in Q1, we have grown by 51%. We'll give you an update on August 13, how things are going. We also confirm the adjusted EBITDA margin of 14%. As said, we invested about [ $45 million] and will invest in the second half of '26 into engineering, operations and regulatory affairs. But there's a clear dedication from our side to continue to grow also in the long run and achieve the midterm target of $300 million to $330 million as well as achieving the bottom line target of above 20% adjusted EBITDA margin. And with that, I also close my section. Thank you very much.

Thank you, Daniel. I will now ask all of our hosts to come up to the front for our Q&A session. We will start with Q&A in the room, and then we'll move to online where Alex will be fielding questions. Over to you, Daniel. I'll let you pick the respondents.

Laura Pfeifer from Octavian. I have 2 questions that relate to your product pipeline where you have said today that you will develop and launch a bone void filler. I suppose that's a bone cement. So just wondering if you could give us more details about maybe the product formulation, time lines and the regulatory pathway here? And then secondly, on the next stage for the bone void filler, you said you would also look into the antibiotic eluting bone void filler space. I guess this would involve a clinical study. Just wondering here if you could give us an update on cost, like total cost and also time lines and also how this relates to your 2028 margin target, I think that you have just confirmed. I guess this is all included in the guidance. Just I think a little bit more color here would be appreciated.

Sure. Thank you. That's -- that was more than 2 questions. There's about 4 sub-questions, but we'll do the best to answer those. No, very exciting. So we're talking about entering a new marketplace for the company. As we have said in the past, as we do product development, we want to make sure we're adding TAM to the business or extending our opportunities within the markets we serve. So going into creating a cement material puts us directly in competition for that $489 million segment, of which many of you are aware of companies such as BONESUPPORT. And so we have broken that down in 3 phases. As you saw, the marketplace as we see it, there are 3 primary buckets. The first and foremost being a settable bone void filler. When we ask the physicians, and we've done a great deal of research and other clinicians about what's the most important attribute to such a product. It is not the addition of an antibiotic. And the reason being is antibiotics are available to every physician in the hospital. Most physicians will make their own secret sauce and mix it in the bin and then put the cement in. Really, the gap in the product portfolio and the product offering and the need we're looking to solve is a faster bone-growing bone settable cement. That is a need that exists in the marketplace, and we feel very uniquely positioned to be able to do that. taking what we've learned from granule production, the purpose of surface topography and generating of bone is what we do, and we do that quite well. Putting that into a cement formulation is the R&D. And so what you can think is much like Intel on the inside for your computers, you can look at our granules on the inside of the cement being much more of an osteoinductive cement than osteoconductive cement, which is available today. That is our unique position, and we believe it solves a big problem with the physician community. Again, entering a brand-new market, I'm not going to give you the actual launch date, but it is 0 to 2 years. So it is in the middle of active development. So what that means is from a regulatory perspective, it is certainly a 510(k) perspective. It's not a long-term clinical study. Relative to drug-eluting cements, certainly, that's in the center stage where we're going to see if it's a necessary need. If we're able to do -- if we do go down that pathway, it certainly will be a clinical trial. From a cost perspective and from a margin perspective, we don't anticipate any large swings within the company's financials to go support that. We can do that with organic capital. And the revenue, you are correct, is included of these future product developments as again, we normally have a 5-year product plan that we operate off of. I think I answered all of them. But I'm sure she's going to tell me if I didn't.

Any more questions in the room? All right. We'll go to Alex online.

Yes, sure. So we have, in the meantime, a few questions. First, given the clinical strength of your product, investors expected faster commercial scaling. What might be the reasons for that? Is it adoption, pricing, reimbursement or sales execution?

Faster commercial. So just to benchmark that, I'm not sure what industry they're coming from for the question, but this is the fastest-growing company in orthopedics, period. And so to go from 5,000 boxes to 50,000 boxes plus in a period of 3 or 4 years, that's pretty quick. Now could we have gone faster? I mean, I think there's always that -- what's holding you back? I mean, honestly, infrastructure, the investments in infrastructure can slow down. If the car is only built for 40 miles an hour and you start driving it at 80 miles an hour, it's going to fall apart. We obviously didn't want the company to fall apart. We were metered in how we were going after markets. We also didn't want to spend cash in an inappropriate method. As I've said before, we don't chase the revenue. We chase the clinical outcome first. Some folks may see that as slower on the revenue. We believe that's a better long-term strategic play for building a foundation. Also, we're talking about patients. We're talking about outcomes. We want to make sure we're providing the right benefits. So I don't know if we could have grown faster, quite frankly, just because of the infrastructure and all the things I just previously mentioned. But the acceptance rate is also surgeons. And surgeons will move early adopters and folks who want to follow. So I think it's a mixture of all of these things. So hopefully, that answers the question. I don't know if it's specific enough, but I'll stop there.

I gave the example of many very successful innovations in health care taking 20 to 30 years. That's the time frame for most successful health care innovations to get to penetrants adoption, if you like. So actually, to echo Chris' point, this is very rapid. When you're faced as a clinician with 170 potential products that you could use, why pick one? It's not going to be a very quick, easy point to get to thousands and thousands of clinicians unless that comes up organically. And actually, the speed, I think, of this is demonstrable evidence that the -- building the foundation, the clinical evidence is the route to growing this space. And at some stage, when adoption happens, the market exponentially rises. And we're kind of getting to that point of inflection, I think, at this stage.

And the final point that I'll add specific to entering these new markets like foot and ankle and trauma is that in order to do it the right way, you have to do it in a methodical manner. In that, you've got to build the team. You have to build the sales channel. You have to build and provide the evidence, you have to educate in order to get to -- in foot and ankle and trauma where we've gotten to in spine and beyond. So all of those activities simply take time to do it the right way, and that's what we try to do.

So I have 2 questions, but I will combine them together. So -- and this is related to the share price of Kuros. So the recent development of the share price as we are showing a strong product performance and debt-free balance sheet, but the share price since the beginning of the year has been quite volatile or trending down. What could be the reason behind it? Or what do you think might be the issue that the share price is not following actually the strong performance of the product?

Well, we very much see that as a sector play. So we see across the MedTech sector that there is decrease in share price since the beginning of the year. Also, if you look at our proxy, we always look at the U.S. MedTech ETF. We see that there's quite a devaluation going on. The other topic in my view is also in our view is basically that there is a capital reallocation happening right now in the market more to AI and obviously, SpaceX just recently. We see that as well. But all we can say is from an operational perspective, we cannot see any reason why the share price is justified.

Yes. I mean it's a buying opportunity for sure. I mean I think that the folks who are covering us certainly believe what we're doing. We come out with solid positive results. We talk about building reputation within the clinical community, but also in the capital markets. The past 4 years or so, Daniel and I and Joost have gone out to the capital markets, said what we were going to go do. And each time we come back, we say we executed on that plus. And that has been a repeated behavior for the past 4 years. Operationally, we're running on point. And so the share pullback, we don't take it personally. We'd like for it to stop, it would be great. But I think it's truly, as Daniel mentioned, the MedTech sector, we see some share buybacks from Boston Scientific, from Zimmer from other large medical device companies. Really, it's a matter of think people will come back to this sector. It's not as if patients have stopped falling off ladders or they no longer have degenerative disc disease. So we continue to operate and execute.

So the next question would also be to, let's say, concerning MagnetOs. So if there is any usage for the dental industry foreseen?

Yes. So certainly, the application of the material in growing bone, as was mentioned earlier, growing bone in the foot and ankle as well as the hip as well as the spine as well as in the dental infrastructure, bone operates the same way. Is there an opportunity there? Sure. We believe the technology works. And we also have a study in craniomaxillofacial as well. Is it a marketplace that we're going to go build a sales force after? The answer is likely no. And the reason being is it's a cash-based business and the use of our efforts are better positioned to go execute in the marketplaces we've already defined. It doesn't mean at some point in time, we may find the appropriate partner down that road.

Maybe I can add to that. So we have done studies or studies have been done with MagnetOs in palate cleft surgeries. It's children with a palate cleft. MagnetOs is there working exceptionally well. You need tooth eruptions. The current market leader there is a material that is hardly resorbing and therefore, teeth cannot erupt. And the surgeons, the CMF surgeon is very happy with what Chris says, the market is just smaller. So we have to prioritize.

Maybe the last question before I hand over again to the audience. That's a new question here, interesting. How well is the company protect against cyber attacks?

Well, I said, I mean, we invested now the last 2 years heavily into IT, and we started actually with IT governance and IT security. And I would say, at this stage, we have all the right infrastructure in place in order to be protected. But I mean, in the end, it's still a human risk most obviously. So phishing attacks can always happen. So we train our people when they onboard the company. and we train them also on a regular basis when they are with us. And yes, basically try to build that also into the enterprise risk management tool that we have all the mitigating controls in place. So I would say from that end, we are much better protected than 2 years ago. But -- they're always trying to find the gaps. So we will continue to build the structure to be protected.

So I'll just make a stop here and go back to the audience.

Yes. We have another question from Laura.

Maybe just coming back to your spinal fusion market share. I think you said you had around 6%, if I remember correctly. We also know that you have these Level 1 studies ongoing. I guess, at some point in time, they will read out the precise and. So I'm just wondering what are your expectations? Do you think you can generate superiority and then use that to further fuel the market share? Or is non-inferiority sufficient? I'm just wondering what could it mean for your growth trajectory in the spinal fusion market.

Sure. So I will take that. Being able to demonstrate statistical superiority requires a certain level of statistical power in your predefined plan. Our first test is always non-inferiority for any trial that's consistent within medical device and biologics. That said, I feel that any prospective randomized controlled multicenter study in biologics in our market is incredibly powerful. And the fact that we have published already, 2 in process, an additional one in foot and ankle, we are investing in clinical evidence at a rate greater than any of our competition. So I think pick any of those studies. I think each of them will be very powerful. I think to, I guess, pat ourselves on the back a little bit. Other biologics companies are not willing or brave enough to randomize their technology to the competition, much less MagnetOs. And we are going -- we're very willing to go head-to-head with the advanced DBMs with the cellular allografts with autograft again. So I'm very proud of our investment in clinical research and just the bravery with which we're willing to push forward, Chris?

On the market side, I'll use cellular allograft as an example. It's about a $450 million market spend in the United States for a product that has 0 clinical publications. So literally, the Level 1 study with a head-to-head to our product will be the very first publication of any evidence of that entire category of product, of which we don't sell one. So it will do several things, highlight the effectiveness of our product, highlight the ineffectiveness of that category and will drive that $450 million segment down quite a bit. It will also push into the hospital systems that are spending money on an ineffective product to take that same amount of capital, push it into products that are effective. So I think that study is a great example of not just serving the clinical need, but also the business need.

Thanks for the question. So thinking about your 2028 guidance, what would you expect from foot and ankle contribution compared to spine? What mix shift would you kind of expect from there?

So we haven't broken down the revenue as of yet between foot and ankle and spine. A large part of that reason is until the business becomes sizable enough to do that from a reporting structure, it doesn't make a whole lot of sense. I think that it's strategically very important. Also, if you want to look globally of total dollars and revenue and you look at the market size, $4 billion in the U.S. is spent in spine and biologics, about $0.5 billion was spent in foot and ankle and about another, call it, $1 billion in trauma. And so you're looking at 20%, 25% is spent not because of much less procedures, but actually, it's the volume of material. So the foot is yo big and the spine is yea big. And so there's more material that's being used. Procedure volumes are, I think it's about a 20% delta, 30% delta. So overall, we aren't splitting out the revenue just yet. I think that -- but the contribution margins in extremity actually are more favorable in spine. So also as we grow the extremity business, the contribution margins tend to be better there.

Yes. I think that's an important point, Chris is making. One of the strategies we have to further increase the margin is actually going into territories where we have lower commissions because that's a big part of our cost structure, right? And by obviously paying lower commissions, we can further boost the contribution margin that will help us to increase our bottom line.

Yes. And it's also the application of the product. We are already sitting in 6, how many hundreds of hospitals in the United States on the spine side. So our ability to go into that hospital system to expand our sale into extremities, whether it be trauma or foot and ankle is a much faster pickup versus starting fresh. So the extremities business has a head start versus what the spine business had. So again, as we build that foundation, we build that base because we believe we can be the biologic entity servicing the entire musculoskeletal community, we're doing a much faster cadence on the extremity side.

And can you maybe give a ballpark range for those margin contributions? And then also just thinking about -- you already mentioned that once you're already present with your spine indications in the hospital, the barrier to entry, I would imagine, is lower. Are there any other barriers to entry that are different in extremities or in the like foot and ankle space that we should keep in mind?

So I'll deal with the barrier, I'll turn to margin over to Daniel. On the barriers to entry, they're very similar, right? So when we access a new marketplace, so we're going into foot and ankle as an example, we are just now expanding the sales and marketing efforts there. So traditionally, the sales agent that represents us in a hospital, they represent sales spine products, spine surgeons, spine products. Rarely do they ever represent foot and ankle products. And so we're in that hospital system. We're cleared on the shelf. We now can go find a foot and ankle sales agent, educate them, train them, get them up to speed and the product is already on the shelf already at an agreed to price for the hospital. That's a much faster uptick. Sometimes it can take a little bit longer going through a foot and ankle committee, but that's fewer than far between. The other part that is a challenge is large hospital buying groups or large hospital systems. So IDNs and hospital systems like HCA, which cover a great deal of hospital contracting, if you're not on contract, you won't be able to work within those hospital systems in the U.S. We were fortunate enough to pick up rather large agreements in Q4 of last year at the very end of Q4 that we're starting to see benefit from and getting access to new hospitals that we didn't have before. That is part of our ongoing strategy and growing our breadth of how do we continue to be accepted, making sure we're in regional IDNs, national agreements. That's a very active part of our business. Some of that, we just heard the other day, we got in a hospital system of about 25, 30 hospitals. That took 2 years. And so sometimes you just have to chip away. Again, something that wasn't mentioned earlier, MDR in Europe. This is another question. We received MDR approval for our technology, which will allow us to sell in the EU beyond 2027. This is a process that was started 10 years ago. We are one of very few companies that have MDR approval. And so when we get closer to that point, it becomes a much more of a strategic advantage to be able to sell into Europe.

Yes. On the contribution side, the way we look at the cost structure is basically we have variable costs, which is obviously cost of goods sold, which is in the neighborhood of 8%, 9%, 10%, somewhere there. And then we obviously also measure what commissions we pay to the 1099, right? And going into extremity will certainly help us to improve that contribution margin by 5-plus percent. And that's also basically built into the EBITDA margin guidance.

If I could add 3 questions. So you mentioned M&A opportunities to grow inorganically. Can you help us understand the gaps you would like to fill and interesting opportunities in the market? So should I go one by one or...

Your choice.

Yes, I'll go one by one.

Okay. So in M&A -- where I'd say we are with inorganic strategy is we're very inquisitive. And so if we look at the landscape of all things that are biologic in nature, that a musculoskeletal surgeon will touch, essentially not going into hardcore metal implants, not going into hardcore instrumentation, we're not going to go into robots, but things that are soft and are biologic in nature, what are those areas? And so that marketplace includes, again, as we've announced today, settable bone void fillers, right? It's a $500 million-plus marketplace growing. And so that's a marketplace we have announced today that we're going into. That's something that's interesting. That's something we feel organically we can go after. There are other spaces, and I'll list off a handful here. It could be anything from a dural adhesion barrier or sealant, which is operating with more neurosurgery and spine surgery. It could be analgesic delivery polymers. It could be all different kinds of marketplaces, things that a surgeon would use. So we map those out and say, do we have a better chance of doing this ourselves? Do we have a better chance of partnering with somebody or licensing a technology or acquiring a company. And so we're very much through the mapping phase and now we're in the monitoring phase of looking at which technologies make sense. Are they technically advanced, what type of clinical work? We can look at technologies that are maybe not revenue producing, but we can provide our firepower relative to sales and marketing that we've been building, and it's so much less expensive. I think those are the areas where it's more of a tuck-in where we accentuate with the new marketplace that we're curious about.

I would just add that everything that Chris just described, we refer to internally as adjacent technologies, meaning it's the same surgeon customer, same surgery intraoperatively where other technologies might be used? And then just to finally add that we've messaged previously that we don't have a current intention to go into any biologic technologies that involve human tissue.

And probably just to add to the capital market, we will do that through non-dilutive financing.

The second question, you have several Level I studies ongoing. Maybe could you provide the key milestones investors should look at over the next 12 to 24 months? That would be helpful.

Well, I mean, for all of these studies, it comes down to the study design. The first key milestone that you want to kind of look forward to is completion of enrollment. So all of the three studies are currently being enrolled. So you'll want to listen to sort of the progress on enrollment to the target. Once you get to completion of enrollment, then you're following patients. And each of the studies has very discrete follow-up criteria. It might be 6-month or 1-year X-rays or CT scans. There are differences between the ASTRA study, for instance, as compared to PROOF and PRECISE. I think that it's fair to say for all of the studies, the 1-year follow-up for those patients is going to be important. When the patients come to the -- back to their physicians, they get their 1-year follow-up, then you're in the data collection and analysis mode to get to the point where you can develop a manuscript and submit it for publication. That can often take 3 to 6 months itself. So it's -- doing these studies is a time-consuming process, but it's enrollment, follow-up, data analysis, publication.

And unlike regulated trials with the FDA, we end up because we have no -- we're doing these studies not for the purpose of approval. We can shave off a great deal of time, effort and money by not having to go through the reporting structure, the reporting delays that are normally associated with a study this big and because there's no federal regulatory authority body attached to it.

And then third question, any changes in the competitive landscape you're observing that is notable and could impact the trajectory of MagnetOs?

I would say that nothing dramatic currently. However, given our success and the magnitude of our business, we do see competition in the market that is beginning to adopt a fair bit of our messaging and positioning themselves against MagnetOs. I don't feel that, that's a significant threat because they don't have the evidence. And so every time one of these competitors comes forward and tries to imply to a surgeon that, well, they're similar to or just like MagnetOs, the answer is, okay, prove it. Show me the evidence. And they don't have any. They can't compare our Level I human clinical evidence to a rat study that they may have done as an example. So they can try, but they don't have the evidence to back it up.

And one of the nice things about being in biologics since they do have a clinical study on a unique technology in the pipeline, we see it. We know what the indications are. We know what the applications are. We know what their approval would likely look like. We can also map out a time line of when we think that would come to play. So there should be no surprises.

I think just I wanted to say that as well from a financing perspective, as you have seen, we are investing quite heavily right now into CapEx and net working capital and further expertise, as I mentioned. And you will see some low point in Q2 and Q3, but don't be too excited. We have a bridge loan in the bag. We will always be able to finance.

Just about the studies that you mentioned those three Level I studies. Did I get it more or less right that in the next 12 or even 18 months, there is not going to be a first readout?

Yes, that's correct. So they are being enrolled. And just what Joe said, the enrollment will take some time. When they're fully enrolled, there will be a primary endpoint between either 6 months or 1 year, mostly 1 year. So that will take some time. In the meantime, by the way, there will be output not from these studies, but from other retrospective studies, other investigator-led studies. But the big -- the important data of Level I studies will take some time.

I think proof will be fully enrolled by end of this year.

Just to maintain for these prospective studies to maintain academic integrity, you can't cheat and get sneak peeks. You have to wait for the full data sets to come together.

And then maybe on those hospital networks that you have made contracts with, you said first signs can be seen -- can you be a little bit more specific? What is the uptake? Or what are you expecting from these contracts?

So I can't give specifics, but I can walk you through a process. And so how a process would work with a large hospital group, it's actually a funny thing. They'll say, well, we won't let you into our hospitals because we don't have any surgeons asking for it. Well, the surgeons are asking for it, but you won't let them have access to it. And so what you end up doing in the circular fashion is you end up getting local contracts with a handful of hospitals within the network on a one-off basis. And once you have enough of those, then you go up to the national level and say, gee, these 12 hospitals really like access and your entire 600 hospital system, we'd like to have a contract and access. And so that process can take from the start to actually getting a national agreement several years. And so once that occurs, now you have the ability to go after the remaining hospitals to see, okay, I'm already in the computer system. I've already agreed to a contracted price for that hospital. Now I've got to go find those surgeons within that hospital system that might be interested in using the product that previously have been told no. So this one hospital system we approached or got a contract with in December. We are in the process, and we track that on a monthly basis. What is our penetration rate? What is -- what are we getting from new customer acquisition? What is the pull-through in the price. So it is working exactly as it should because you have limited competitors because most are on the outside. We're lucky to be on the inside. And by the way, we got on the inside because of our clinical data and because of the efficaciousness and because of the surgeons that were willing to go to bat for us. That is how the process takes. And again, it can take 6 months, it can take 3 years. And so it's a long-term strategy to build your base. But we don't break it out by hospital system by penetration. What I can tell you is that our numbers of surgeons and hospitals continues to grow month-over-month, and we track penetration rate, not just by hospitals, but also by association of what's hospital systems.

[indiscernible] Can you talk a bit about the risks in the U.S. as most of your business is in the U.S. with Medicare, Medicaid, MFN, [ Nairoi ] protocols, Section 232 reimbursement cuts, especially Medicare and Medicaid and I guess you have had a big exposure to this segment. First question.

So in the U.S., we operate under a DRG health care system. So it's one payment for the entire surgery. So everything from the blade to the implants to the biologics to the sponges that are used, it's a capped fee that's sold -- that's paid to the hospital and then the hospital decides what they're paying for what. Medicare and then obviously, the Blue Crosses and private health care is a percentage up on top of Medicare. The drug control pricing does not affect us. We are not a drug. We are a device. And so this discussion of 231, I believe, does not affect us one bit. Medicare and they set the pricing based on procedure volumes in coordination with hospitals and volumes of patients, et cetera. Orthopedic care continues to get funded. There are -- tend to be cuts of 1% to 2% on different procedures, but then you see improvements in others. There's trying to keep the hospitals profitable. Orthopedic surgeons and orthopedic spine surgeons within the hospital system are very vital. And so the surgeries continue forward. So do we see a risk on the horizon of great magnitude to our procedures? No. I think that having a wider amount of procedures we can be effect helps our case. So if one decision that Medicare happened to say, well, gee, we're going to focus on reducing reimbursement in the big toe versus spine. We don't have all of our business in the big toe, nothing against the big toe. So hopefully, that answers your question, but we see the risk is de minimis.

Sure. Just maybe related to that, you obviously work with mostly agents and distributors in the U.S. And I wonder if you have enough capacity to give the service in the U.S. as at least from my knowledge from larger joints, it's kind of mandatory for a sales rep to attend the operating theater and probably it's not in your segment, but I wonder if you have the capability to serve that via your own clinician or...

I don't know. So the question is if -- I'll ask -- I'll read back the question differently. Do we have the ability to have a direct sales force versus using a sales agent?

Not at this stage.

It's very expensive. We partner with sales agents in the United States for a couple of reasons. Number one, they're in the surgery with the hardware component of the surgery. And that tends to be the primary relationship between the physician and the sales agent. And so we partner with those folks. It's the reason why our relationship with Medtronic is so positive. They have the #1 position, #1 sales force from a spine procedure out there. And as great as they are, they have a 23%, 24% market share. And so we partner with Medtronic where it makes sense for the company. And then if there's other areas where there might be a stronger sales force, we will partner with them. Our responsibility is to ensure we get to all the surgeons, not just the ones attached to one singular company. But -- so independent sales agents provide us the flexibility to pay-as-you-go versus direct sales forces, which tend to be very expensive. And in my experience, you have to have several product lines being able to carry your own sales force, but very much independent sales force.

Just to say from a clinician perspective, if you're using a for example, a joint replacement or something, and it's heavily instrumented. It's actually your scrub nurse, the people in the operating theater that you're actually helping by having the agent there. So the agents are there to help them know what to pick up next, what to put together and what to give to you as a surgeon. When it comes to a biological, as I said, there's potentially 170 to choose from. Most surgeons are pretty capable of knowing what to do with the biologic to put it into the patient. So you don't actually need a rep with any expertise over the product. What you need is someone that's or sufficient materials or information to provide to you beforehand that gives you confidence that using that product over something else has benefits. So you don't actually need someone physically in the room with you for the biologic. But you do very much for a joint recon or for other parts because not necessarily for you as a surgeon, but for your scrub team to assist them with their part, which is very heavily instrumented.

I was just going to finally add that in the United States, we do and we have been committed to the independent agent model. To support that, we have a team of area directors that underneath them have a team of regional managers who directly manage those independent agents. And we add and remove agents on an ongoing basis at the local level. But overall, the number of total independent agents with whom we work continues to increase. So I think that in direct answer to your question, do we have the capacity to support the growth from an agent perspective? The answer is yes, and we've got a team in place to manage that growth on the...

Yes. it's a pay-as-you-go. And so the independent agent model is fantastic for us. I'm a huge, huge proponent of it. Those are the sales agents that are listening, big fan. But there is no cap as far as how many we can add because they're not headcount. And so it's a variable cost. So yes, so there's no cap on how fast we can add them, and we supplement them with our own personnel from education, training, medical affairs, clinical affairs, any of our customer-facing entities. So...

Marketing...

And marketing. Sorry, Joe. He's right there. Another one. That's it. You've got your quota.

No, I was just coming back maybe to the trauma market, which you will enter, I think, in the not-too-distant future with a bone void filler. I guess that's the primary product you intend to position there. I'm just wondering if you could describe a little bit as we are not that familiar with the market, what are the other players doing? How fragmented is it? And also, how do you think about it in the long run? I mean, would it also make sense maybe to go into strategic alliance as you have done with Medtronic?

So a couple of things, and I'll ask Joe to pipe in as well or Mr. Golberg. I think predominantly, we're going after the trauma market initially with bone graft material, right? So there are certain patients that present that you do not need to have a settle bone void filler or cement-like product, where there's plates, there's screws and there's stability already being -- and there's not a massive defect, you're filling a crevice, that's fine. You use existing product off the shelf. We're doing cases now. You saw from Carlos earlier in his presentation, some of the patients that he has been treating. Right now, where we are is gaining understanding of the right patient population, again, back to the methodology, understand the market you're in, ask your surgeons what they're missing, what features they'd like to see in a new product. So that kind of starts that basis just on the bone graft material. On the settable bone void filler marketplace, what we have seen and heard to date from the physician community is that it's not so much about the antibiotic. It is much more about bone and bone replacement. So you're putting something in there to fill a defect but you eventually wish bone to replace it. The speed to which that happens, is it an osteoconductive or is it osteoinductive? And so when looking at our technology and our prowess and knowledge, could we make a much faster bone-growing cement. That is the ask of the internal team, and I hand it over to Joost, but that's the rabbit we're chasing because we believe we can bring such a product to the marketplace, solve the true problem and then a surgeon can add gentamicin or vancomycin from the pharmacy in the hospital like they do already at a much lower cost.

Yes. No, just to say, if you're dealing with an infected case, so for example, in diabetic trauma, an infected case, you will often may have some indications from your microbiology colleagues of what antibiotics to use. And it won't necessarily be gentamicin or vancomycin. It may be something else, maybe a combination, [ ciccroplain ] or some other medication. So often, it's not unusual for us to take advice from the microbiologists and then make that specific to the patient. So frankly, I don't think as a clinician, I would prefer to pay for a ready-made product where I'm paying a massive increment for the product because I'm paying for the regulatory pathway that they got to approve that product. When I can actually take a cheaper product, which is a bone substitute preferably one with osteoinductive capacity, but I can then tailor for that patient by giving the right antibiotics as advised by microbiology colleagues. So it's personalized medicine, which is obviously in the future, but it's also cost effective because it's far cheaper for me to take the advice on the antibiotic, mix that with whatever bone substitute I'm going to use and place it onto that patient than it is for me to pay for a ready-made product, which has included all the costs of the regulatory pathway, the regulations, the approval of marketing and all the other things, which may be 3 or 4x the price. So in terms of trauma, the good examples where there's big bone voids would be a tibial plateau, so a crush of the knee or pilon fracture, which is a crush of the distal tibia. But there's big bone voids, huge vacuous areas that we've got to fill. In those situations, you don't need antibiotics. And so you would use the same bone substitute, you're using as a bone filler, you're less likely to use antibiotics unless it's an open fracture where there's a hedgehog or something inside the wound. So in closed fractures, which is probably more common than open fractures, where you're using it as a bone filler, you wouldn't need antibiotics. So yes, I think from my side, the ability to have a reliable bone substitute is more important than having had a regulatory approved drug device combination.

Any more questions in the room? Anything from Alex?

I think we have a follow-on question, which goes in the same direction also about here now about the antibiotic-eluting, settable bone filler. And can you share what the product would look like? So is it also a calcium phosphate or is it -- or what is it based on? And do you have anything to support that it also works? And what is reasonable to expect a clinical trial to resume? Or when is it going to start? And what would be the size of such a trial? And by when do we expect such a drug or product to be approved by the FDA?

That's a lot of questions. So I'm going to turn the technical expertise over to Joost, but relative to the initial technology, we've noticed -- we highlighted that we would have that available without antibiotic as a settable bone void filler focused on the bone growth capabilities, obviously, focusing on the granular, the microneedle structure that we already have. And so that material is in development, will be released within the next 2 years, does not require a clinical trial. It doesn't mean we won't do one. Certainly, the animal work and some of the technology, I'll leave over to Joost.

Yes. So the animal work is on its way as we speak. The material itself is a calcium sulfate, like other injectable settable bone growth fillers with MagnetOs. And it's been mentioned before, MagnetOs will provide the osteoinductivity. Calcium sulfate is resorbing quickly. You could add your antibiotics to the calcium sulfate, which is what has been done also with competitor products. But what Mr. Golberg rightly said, the question is, should we even do that because maybe some surgeons will just apply the antibiotics to this cement. That will be longer term, by the way, that product will be -- if we're developing that will be, I think, 3 to 5 years at least. But yes, so the product that currently we are developing without antibiotics is calcium sulfate with MagnetOs.

And as I mentioned in that -- previously, in that midterm column, which is where this resides, is currently in research. So to Joost's point, we're evaluating it internally. We're evaluating it in various formulations in different models, but it's not an active project with a time line. So it's impossible for us to speak or make an estimate on project approval because we're just still formulating exactly what we want to definitively pursue.

And that's for the antibiotic-eluting piece. The other one is active, in development, sub-2 years.

I have another question, and it's related to our Medtronic partnership. How is it going? And in the same way is also the question, is there a possibility for patients also to ask a surgeon to use MagnetOs or demand it?

Power to the patient. So I think that -- first off, the Medtronic relationship has been going great. I think the relationship that we signed, we started with a pilot program and then when we signed the relationship January of '24. '25. I forget what year it says. It's been great. We've been -- it's worked for both parties. We've added numerous physicians and onboarded numerous physicians. We've been able to partner with them in certain territories and geographies in the U.S. And they've been able to fill a gap in their portfolio that exists that they don't have a product to service. When you look at their portfolio, and they have the BNP product, which is very effective, but at a higher cost than a Grafton product. They didn't really didn't have anything in the category in between. And so this really was a strategy for their end to fill a gap in their portfolio. The territories that we're working together with them in has been very successful. So all in all, great partnership. And then the second question was patients. Yes, patient advocacy is great. Ask for it by name. Let's know how we can help.

Yes. I would add, I'm a large proponent of patient education. And if the patient often when they are going into these procedures, they're in pain, they're suffering, a surgeon is offering a solution. And often, they're not in a real position to like ask the details of exactly what's going to happen in my surgery. Specifically, what else other than maybe the metal is going to go in and what's going to happen and what is it and how does it work? And so I like the idea of patients educated to a point where they can ask the question. Are you using a biologic? If so, what is it? And why do you have confidence in it? Maybe a patient is educated to the point where they say, I prefer to not have other human tissue implanted in my body. There are some religious groups that are very much against that. So we have an opportunity there. But on the marketing side, we do put content out in social media and through other channels in an effort that patients find us, become educated and just ask the surgeons their questions.

I'd just like to add that it's quite a long part of the consenting process is the use of biologics. So if you're going to use human tissue, you have to have their consent in writing before the case. And you can't -- for example, if you decide during the case, I need to use something, you can't then go and borrow something from another hospital because it's not allocated and pre-organized in that patient's name with that human tissue authority regulatory number on there. So actually, technically, using human tissue is a big technical challenge for us. The other thing is it has to be available on the shelf. If the patient came in and said to me, I'd like to use MagnetOs and I'm in a hospital that doesn't have MagnetOs on the shelf, then I can't use MagnetOs because it's not there. So yes, it's irrelevant what the patient says if it's not available on the procurement side.

So an additional question would be probably to Daniel now. Is there any plan to also show the split of the sales in the different areas where we are active?

Yes. I mean, as Chris already said, I mean, once it's obviously reportable, then we will do it. So to answer your question.

And the last question online here is, is there any plan to go into animal health care?

Much like dental, the challenge there is the size of the market and the need. And so we can only do so many things. And so the size of that market is quite small. And so sadly, we won't be pursuing the veterinarian if somebody wish to partner with us, and we might go down that, but it's not a topic of focus for us.

The sales channel challenge is.

Yes, the sales channel there is very real. It's a problem, challenge, not a problem.

Okay. We have no more questions in the room. So I'll hand it over to you, Chris, for closing words.

First off, I want to thank you for the panel. Mr. Goldberg, thank you so much for your words, your guidance and certainly your clinical experience and how you use the product and also how you treat your patients. It's very enlightening for all of us, even those of us who have been in the community for quite some time, we always learn something new. So thank you very much for your participation. It's an exciting day for us when we get to share a little bit deeper about how our business works and how we operate. It's also even more exciting to share when we're executing on all fronts, and then we're adding new business opportunities to the business. And so very excited with both the outcome and hopefully, the message we were able to deliver today. So I thank you for your time. For those of you online, thank you for tuning in. Yes. Thank you very much.