UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 7.01. | Regulation FD Disclosure. |
Organogenesis Holdings Inc. (the “Company”) from time to time presents at various industry and other conferences and provides summary business information. A copy of the slide presentation that will be used by representatives of the Company in connection with such presentations (the “Corporate Presentation”) is attached to this Current Report on Form 8-K as Exhibit 99.1. The Corporate Presentation is current as of September 15, 2020, and the Company disclaims any obligation to correct or update this material in the future.
The information in the Corproate Presentation attached as Exhibit 99.1 is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit |
Description | |
| 99.1 | Corporate Presentation current as of September 15, 2020. | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Organogenesis Holdings Inc. | ||
| By: | /s/ Lori Freedman | |
| Name: | Lori Freedman | |
| Title: | Vice President and General Counsel | |
Date: September 15, 2020
0 Exhibit 99.1 Corporate Presentation September 20200 Exhibit 99.1 Corporate Presentation September 2020
1 Forward-Looking Statements and Other Important Cautions / Industry and Market Data Unless the context indicates otherwise, the terms “Organogenesis,” “Company,” “we,” “us” and “our” refer to Organogenesis Holdings Inc. (formerly known as Avista Healthcare Public Acquisition Corp.), a Delaware corporation, and its subsidiaries. References in this presentation to the “Business Combination” refer to the consummation of the transactions contemplated by that certain Agreement and Plan of Merger, dated as of August 17, 2018, which transactions were consummated on December 10, 2018. This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts of future events. Forward-looking statements may be identified by the use of words such as “forecast,” “intend,” “seek,” “target,” “anticipate,” “believe,” “expect,” “estimate,” “plan,” “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Such forward-looking statements include statements relating to the Company’s expected revenue for fiscal 2020 and the breakdown of such revenue in both its Advanced Wound Care and Surgical & Sports Medicine categories as well as the estimated revenue contribution of its PuraPly products and non-PuraPly products and statements related to ongoing clinical trials and the expected launch dates for new products. Forward- looking statements with respect to the operations of the Company, strategies, prospects and other aspects of the business of the Company are based on current expectations that are subject to known and unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from expectations expressed or implied by such forward-looking statements. These factors include, but are not limited to: (1) the Company has incurred significant losses since inception and anticipates that it will incur substantial losses for the foreseeable future; (2) the Company faces significant and continuing competition, which could adversely affect its business, results of operations and financial condition; (3) rapid technological change could cause the Company’s products to become obsolete and if the Company does not enhance its product offerings through its research and development efforts, it may be unable to effectively compete; (4) to be commercially successful, the Company must convince physicians that its products are safe and effective alternatives to existing treatments and that its products should be used in their procedures; (5) the Company’s ability to raise funds to expand its business; (6) the impact of any changes to the reimbursement levels for the Company’s products and the impact to the Company of the loss of preferred “pass through” status for PuraPly AM and PuraPly on October 1, 2020; (7) the Company’s ability to maintain compliance with applicable Nasdaq listing standards; (8) changes in applicable laws or regulations; (9) the possibility that the Company may be adversely affected by other economic, business, and/or competitive factors; (10) the Company’s ability to complete the relaunch of Affinity and to maintain production in sufficient quantities to meet demand; and (11) other risks and uncertainties described under the caption Risk Factors in Item 1A (Risk Factors) of the Company’s Form 10-K for the year ended December 31, 2019 and in subsequent periodic filings with the SEC including risks related to the coronavirus (COVID-19) pandemic. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Although it may voluntarily do so from time to time, the Company undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Unless otherwise noted, the forecasted industry and market data contained herein are based upon management estimates and industry and market publications and surveys. The information from industry and market publications has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. The Company has not independently verified any of the data from third-party sources, nor has the Company ascertained the underlying economic assumptions relied upon therein. While such information is believed to be reliable for the purposes used herein, the Company makes no representation or warranty with respect to the accuracy of such information. 11 Forward-Looking Statements and Other Important Cautions / Industry and Market Data Unless the context indicates otherwise, the terms “Organogenesis,” “Company,” “we,” “us” and “our” refer to Organogenesis Holdings Inc. (formerly known as Avista Healthcare Public Acquisition Corp.), a Delaware corporation, and its subsidiaries. References in this presentation to the “Business Combination” refer to the consummation of the transactions contemplated by that certain Agreement and Plan of Merger, dated as of August 17, 2018, which transactions were consummated on December 10, 2018. This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts of future events. Forward-looking statements may be identified by the use of words such as “forecast,” “intend,” “seek,” “target,” “anticipate,” “believe,” “expect,” “estimate,” “plan,” “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Such forward-looking statements include statements relating to the Company’s expected revenue for fiscal 2020 and the breakdown of such revenue in both its Advanced Wound Care and Surgical & Sports Medicine categories as well as the estimated revenue contribution of its PuraPly products and non-PuraPly products and statements related to ongoing clinical trials and the expected launch dates for new products. Forward- looking statements with respect to the operations of the Company, strategies, prospects and other aspects of the business of the Company are based on current expectations that are subject to known and unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from expectations expressed or implied by such forward-looking statements. These factors include, but are not limited to: (1) the Company has incurred significant losses since inception and anticipates that it will incur substantial losses for the foreseeable future; (2) the Company faces significant and continuing competition, which could adversely affect its business, results of operations and financial condition; (3) rapid technological change could cause the Company’s products to become obsolete and if the Company does not enhance its product offerings through its research and development efforts, it may be unable to effectively compete; (4) to be commercially successful, the Company must convince physicians that its products are safe and effective alternatives to existing treatments and that its products should be used in their procedures; (5) the Company’s ability to raise funds to expand its business; (6) the impact of any changes to the reimbursement levels for the Company’s products and the impact to the Company of the loss of preferred “pass through” status for PuraPly AM and PuraPly on October 1, 2020; (7) the Company’s ability to maintain compliance with applicable Nasdaq listing standards; (8) changes in applicable laws or regulations; (9) the possibility that the Company may be adversely affected by other economic, business, and/or competitive factors; (10) the Company’s ability to complete the relaunch of Affinity and to maintain production in sufficient quantities to meet demand; and (11) other risks and uncertainties described under the caption Risk Factors in Item 1A (Risk Factors) of the Company’s Form 10-K for the year ended December 31, 2019 and in subsequent periodic filings with the SEC including risks related to the coronavirus (COVID-19) pandemic. You are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Although it may voluntarily do so from time to time, the Company undertakes no commitment to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Unless otherwise noted, the forecasted industry and market data contained herein are based upon management estimates and industry and market publications and surveys. The information from industry and market publications has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. The Company has not independently verified any of the data from third-party sources, nor has the Company ascertained the underlying economic assumptions relied upon therein. While such information is believed to be reliable for the purposes used herein, the Company makes no representation or warranty with respect to the accuracy of such information. 1
2 Use of Non-GAAP Financial Measures This Company has presented the following measures that are not measures of performance under accounting principles generally accepted in the United States (“GAAP”): EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA are not measurements of our financial performance under GAAP and these measures should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities (including net cash used in operating activities and purchases of property and equipment) as a measure of our liquidity. EBITDA as used herein is defined as net income (loss) attributable to Organogenesis Holdings Inc. before depreciation and amortization, net interest expense and income taxes and the Company defines Adjusted EBITDA as EBITDA, further adjusted for the impact of certain items that the Company does not consider indicative of its core operating performance. These items may include non- cash equity compensation, mark to market adjustments on the Company’s warrant liabilities, change in fair value of interest rate swaps and its contingent asset and liabilities, write-off of deferred offering costs, merger transaction costs related to the Business Combination, a loss on the extinguishment of debt, and other costs and expenses incurred not related to the Company’s core operations. The Company presented Adjusted EBITDA in this presentation because it is a key measure used by the Company’s management and Board of Directors to understand and evaluate the Company's operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, the Company's management believes that the exclusion of certain items in calculating Adjusted EBITDA can produce a useful measure for period-to-period comparisons of the Company’s business. The Company’s management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. Other companies may calculate EBITDA, Adjusted EBITDA, and other non-GAAP measures differently, and therefore the Company’s EBITDA, Adjusted EBITDA, and other non-GAAP measures may not be directly comparable to similarly titled measures of other companies. A reconciliation of Non-GAAP measures used in this presentation to the most closely comparable GAAP measure is set forth in the Appendix. There are a number of limitations related to the use of Adjusted EBITDA rather than net income (loss), which is the most directly comparable GAAP equivalent. Some of these limitations are: • Adjusted EBITDA excludes stock-based compensation expense, as stock-based compensation expense has recently been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy; • Adjusted EBITDA excludes depreciation and amortization expense and, although these are non-cash expenses, the assets being depreciated may have to be replaced in the future; • Adjusted EBITDA excludes net interest expense, or the cash requirements necessary to service interest, which reduces cash available to us; • Adjusted EBITDA excludes the impact of the changes in the fair value of our warrant liability and our contingent consideration forfeiture asset; • Adjusted EBITDA excludes the write-off of deferred offering costs in connection with an abandoned public offering, as well as merger transaction costs, consisting primarily of legal and professional fees; • Adjusted EBITDA excludes the loss of extinguishment of debt, which is a non-cash loss related to the write-off of unamortized debt issuance costs upon repayment of affiliate and third-party debt, and related prepayment penalties; • Adjusted EBITDA excludes the advisory, legal, and professional fees incurred in connection with the warrant exchange transactions; • Adjusted EBITDA excludes other costs and expenses incurred not related to operations; • Adjusted EBITDA excludes income tax expense (benefit); and • Other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure. 22 Use of Non-GAAP Financial Measures This Company has presented the following measures that are not measures of performance under accounting principles generally accepted in the United States (“GAAP”): EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA are not measurements of our financial performance under GAAP and these measures should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities (including net cash used in operating activities and purchases of property and equipment) as a measure of our liquidity. EBITDA as used herein is defined as net income (loss) attributable to Organogenesis Holdings Inc. before depreciation and amortization, net interest expense and income taxes and the Company defines Adjusted EBITDA as EBITDA, further adjusted for the impact of certain items that the Company does not consider indicative of its core operating performance. These items may include non- cash equity compensation, mark to market adjustments on the Company’s warrant liabilities, change in fair value of interest rate swaps and its contingent asset and liabilities, write-off of deferred offering costs, merger transaction costs related to the Business Combination, a loss on the extinguishment of debt, and other costs and expenses incurred not related to the Company’s core operations. The Company presented Adjusted EBITDA in this presentation because it is a key measure used by the Company’s management and Board of Directors to understand and evaluate the Company's operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, the Company's management believes that the exclusion of certain items in calculating Adjusted EBITDA can produce a useful measure for period-to-period comparisons of the Company’s business. The Company’s management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. Other companies may calculate EBITDA, Adjusted EBITDA, and other non-GAAP measures differently, and therefore the Company’s EBITDA, Adjusted EBITDA, and other non-GAAP measures may not be directly comparable to similarly titled measures of other companies. A reconciliation of Non-GAAP measures used in this presentation to the most closely comparable GAAP measure is set forth in the Appendix. There are a number of limitations related to the use of Adjusted EBITDA rather than net income (loss), which is the most directly comparable GAAP equivalent. Some of these limitations are: • Adjusted EBITDA excludes stock-based compensation expense, as stock-based compensation expense has recently been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy; • Adjusted EBITDA excludes depreciation and amortization expense and, although these are non-cash expenses, the assets being depreciated may have to be replaced in the future; • Adjusted EBITDA excludes net interest expense, or the cash requirements necessary to service interest, which reduces cash available to us; • Adjusted EBITDA excludes the impact of the changes in the fair value of our warrant liability and our contingent consideration forfeiture asset; • Adjusted EBITDA excludes the write-off of deferred offering costs in connection with an abandoned public offering, as well as merger transaction costs, consisting primarily of legal and professional fees; • Adjusted EBITDA excludes the loss of extinguishment of debt, which is a non-cash loss related to the write-off of unamortized debt issuance costs upon repayment of affiliate and third-party debt, and related prepayment penalties; • Adjusted EBITDA excludes the advisory, legal, and professional fees incurred in connection with the warrant exchange transactions; • Adjusted EBITDA excludes other costs and expenses incurred not related to operations; • Adjusted EBITDA excludes income tax expense (benefit); and • Other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure. 2
3 Key Company Highlights $8.9Bn+ $6Bn+ Attractive End Markets Advanced Wound Care Surgical & Sports Medicine 1 Market (AWC) Market (S&SM) Differentiated and Comprehensive Suite of 2 Products Proven R&D Engine with Pipeline products recently launched or 7 expected to in next 2 years 3 Deep Pipeline Robust Clinical Data 200+ 15 (1) Publications reviewing 4 Ongoing studies Supporting Products Organogenesis products ~285 Direct Sales Representatives 3,200+ 450k+ Established and Scalable Healthcare facilities Square feet across Infrastructure 5 (2) ~160 served in 2019 4 dedicated facilities Independent Agencies Growth Drivers: $270mm - Organic end market growth LTM 06/30/20A revenue Rapidly Scaling Business with - New product introductions 6 Multiple Levers for Growth - Manufacturing expansion & efficiencies 71% (3) - M&A / in-licensing opportunities Gross margin Notes: 1. Includes studies yet to publish data and retrospective projects. 3 2. Number of facilities that have ordered products in 2019. 3. 12 months ended 6/30/20 gross margin.3 Key Company Highlights $8.9Bn+ $6Bn+ Attractive End Markets Advanced Wound Care Surgical & Sports Medicine 1 Market (AWC) Market (S&SM) Differentiated and Comprehensive Suite of 2 Products Proven R&D Engine with Pipeline products recently launched or 7 expected to in next 2 years 3 Deep Pipeline Robust Clinical Data 200+ 15 (1) Publications reviewing 4 Ongoing studies Supporting Products Organogenesis products ~285 Direct Sales Representatives 3,200+ 450k+ Established and Scalable Healthcare facilities Square feet across Infrastructure 5 (2) ~160 served in 2019 4 dedicated facilities Independent Agencies Growth Drivers: $270mm - Organic end market growth LTM 06/30/20A revenue Rapidly Scaling Business with - New product introductions 6 Multiple Levers for Growth - Manufacturing expansion & efficiencies 71% (3) - M&A / in-licensing opportunities Gross margin Notes: 1. Includes studies yet to publish data and retrospective projects. 3 2. Number of facilities that have ordered products in 2019. 3. 12 months ended 6/30/20 gross margin.
4 Experienced Leadership with Track Record of Execution Henry Hagopian Gary Gillheeney, Sr Patrick Bilbo Brian Grow Antonio Montecalvo Lori Freedman Interim Chief Financial President & Chief Chief Operating Chief Commercial VP, Health Policy VP and Officer, VP Finance, Executive Officer Officer Officer and Contracting General Counsel Treasurer ◼ 25+ years in senior ◼ 13 years at ◼ 26 years with ◼ 16 years with ◼ 17 years with ◼ 15+ years as public leadership positions in Organogenesis Organogenesis Organogenesis Organogenesis company general both public and counsel and business ◼ Previously held ◼ 6 years experience of ◼ Previously held ◼ Previously spent 3 private organizations development executive controller and manager Provider contracting management and years at Novartis / ◼ Served as President positions at CIRCOR with UnitedHealth and ◼ Most recently VP research positions at Innovex and 1 year at and CEO of International and 7 years public Corporate Affairs, Hologic, Stryker, and Bristol-Myers Squibb Organogenesis Stratus Technologies accounting experience General Counsel & Harvard Medical since 2014 with large local public Secretary of pSivida School accounting firms Corp. with earlier ◼ 18 years at career at McDermott, Organogenesis; also Will & Emery served as COO and CFO ◼ Recognized as one of Ernst & Young’s 2009 “Entrepreneur of the Year“ Innovative Clinical Solutions 4 Background Information Name/Title4 Experienced Leadership with Track Record of Execution Henry Hagopian Gary Gillheeney, Sr Patrick Bilbo Brian Grow Antonio Montecalvo Lori Freedman Interim Chief Financial President & Chief Chief Operating Chief Commercial VP, Health Policy VP and Officer, VP Finance, Executive Officer Officer Officer and Contracting General Counsel Treasurer ◼ 25+ years in senior ◼ 13 years at ◼ 26 years with ◼ 16 years with ◼ 17 years with ◼ 15+ years as public leadership positions in Organogenesis Organogenesis Organogenesis Organogenesis company general both public and counsel and business ◼ Previously held ◼ 6 years experience of ◼ Previously held ◼ Previously spent 3 private organizations development executive controller and manager Provider contracting management and years at Novartis / ◼ Served as President positions at CIRCOR with UnitedHealth and ◼ Most recently VP research positions at Innovex and 1 year at and CEO of International and 7 years public Corporate Affairs, Hologic, Stryker, and Bristol-Myers Squibb Organogenesis Stratus Technologies accounting experience General Counsel & Harvard Medical since 2014 with large local public Secretary of pSivida School accounting firms Corp. with earlier ◼ 18 years at career at McDermott, Organogenesis; also Will & Emery served as COO and CFO ◼ Recognized as one of Ernst & Young’s 2009 “Entrepreneur of the Year“ Innovative Clinical Solutions 4 Background Information Name/Title
5 Track Record Since Business Combination (1) Business Combination @ 12/10/2018 Current Position ◼ 11 Commercialized Products ◼ 9 Commercialized Products ◼ 5 Pipeline products Product ◼ 5 Pipeline products Portfolio◼ 2 Market-expanding BLA programs ◼ 2 Market-expanding BLA programs ◼ 200+ publications; 15 ongoing studies ◼ Consolidated Clinical Operations & Initiated Studies ◼ 215 Sales Reps◼ 275 Sales Reps Operations/ ◼ 130 Independent Agencies◼ 165 Independent Agencies Customers ◼ 3,200+ Healthcare facilities served ◼ 3,000 Healthcare facilities served (2) 14% Growth ◼ 2018 Revenue: $193mm ◼ LTM 06/30/20 Revenue: $270mm (3) ◼ Gross Margins: 64%◼ Gross Margins: 71% 600+ BPS Financial Performance◼ Adjusted EBITDA: ($36)mm◼ LTM 06/30/20 Adjusted EBITDA: ($17)mm Notes: 3. Represents margin improvement from 2018A. 1. As of 12/31/2018 5 2. Represents growth from LTM 06/30/19 revenue.5 Track Record Since Business Combination (1) Business Combination @ 12/10/2018 Current Position ◼ 11 Commercialized Products ◼ 9 Commercialized Products ◼ 5 Pipeline products Product ◼ 5 Pipeline products Portfolio◼ 2 Market-expanding BLA programs ◼ 2 Market-expanding BLA programs ◼ 200+ publications; 15 ongoing studies ◼ Consolidated Clinical Operations & Initiated Studies ◼ 215 Sales Reps◼ 275 Sales Reps Operations/ ◼ 130 Independent Agencies◼ 165 Independent Agencies Customers ◼ 3,200+ Healthcare facilities served ◼ 3,000 Healthcare facilities served (2) 14% Growth ◼ 2018 Revenue: $193mm ◼ LTM 06/30/20 Revenue: $270mm (3) ◼ Gross Margins: 64%◼ Gross Margins: 71% 600+ BPS Financial Performance◼ Adjusted EBITDA: ($36)mm◼ LTM 06/30/20 Adjusted EBITDA: ($17)mm Notes: 3. Represents margin improvement from 2018A. 1. As of 12/31/2018 5 2. Represents growth from LTM 06/30/19 revenue.
6 Q2 Revenue Results 2Q 2020 Revenue Summary ◼ Net revenue of $69.0 million for the three months ended June 30, 2020, up 6% compared to net revenue of $64.9 million for the three months ended June 30, 2019. Net revenue is based upon: ◼ Net revenue from Advanced Wound Care products of $59.7 million, up 8% year-over-year. ◼ Net revenue from Surgical & Sports Medicine products of $9.2 million, down 5% year-over-year. ◼ Net revenue from the sale of PuraPly products of $28.5 million for the three months ended June 30, 2020, down 4% year-over-year. 66 Q2 Revenue Results 2Q 2020 Revenue Summary ◼ Net revenue of $69.0 million for the three months ended June 30, 2020, up 6% compared to net revenue of $64.9 million for the three months ended June 30, 2019. Net revenue is based upon: ◼ Net revenue from Advanced Wound Care products of $59.7 million, up 8% year-over-year. ◼ Net revenue from Surgical & Sports Medicine products of $9.2 million, down 5% year-over-year. ◼ Net revenue from the sale of PuraPly products of $28.5 million for the three months ended June 30, 2020, down 4% year-over-year. 6
7 Large and Growing Target Markets 77 Large and Growing Target Markets 7
8 Skin Substitutes is a Fast-Growing, Under-Penetrated Segment of the Advanced Wound Care Market (1) (2) AWC Market Skin Substitute Sub-Market ~$8.9+ Billion ~$965mm Advanced Biologics Wound ~$725mm 17% 54% Dressing Skin Substitutes 9% 20% Other 2016A 2018A Negative Pressure Wound Therapy Less than 5% of addressable wounds are (2) Mid-single digit growth treated with skin substitutes Key Drivers of Skin Substitute Market Include: Physician and payer education about the effectiveness and benefits of these products Clinical data Overall growth of Advanced Wound Care market driven by aging demographics and increase in co- morbidities such as diabetes, obesity, etc. Notes: 1. BIS Research; Global Advanced Wound Care Market (2019). Report covers global market. 8 2. BioMed GPS SmartTrak (2019). Report covers US market.8 Skin Substitutes is a Fast-Growing, Under-Penetrated Segment of the Advanced Wound Care Market (1) (2) AWC Market Skin Substitute Sub-Market ~$8.9+ Billion ~$965mm Advanced Biologics Wound ~$725mm 17% 54% Dressing Skin Substitutes 9% 20% Other 2016A 2018A Negative Pressure Wound Therapy Less than 5% of addressable wounds are (2) Mid-single digit growth treated with skin substitutes Key Drivers of Skin Substitute Market Include: Physician and payer education about the effectiveness and benefits of these products Clinical data Overall growth of Advanced Wound Care market driven by aging demographics and increase in co- morbidities such as diabetes, obesity, etc. Notes: 1. BIS Research; Global Advanced Wound Care Market (2019). Report covers global market. 8 2. BioMed GPS SmartTrak (2019). Report covers US market.
9 Surgical & Sports Medicine Market Is An Underserved, High-Growth Market ~$6Bn+ Market Growing ~8% Annually Chronic Inflammatory And Bone Fusion Tendon and Ligament Injuries Degenerative Conditions (1) (2) (1) ~$2.7Bn ~$1.0Bn ~$2.4Bn Market size Market size Market size ◼ Includes spine fusion surgery and ◼ Includes rotator cuff and achilles◼ Includes osteoarthritis (OA), other bone graft substitutes tendon repairs tendonitis, plantar fasciitis OA affects ~667k ~250k Spine fusions annually in the U.S. Rotator cuff repairs and ~27mm in the U.S. ~40k Outpatient achilles tendon repairs in the U.S. annually Notes: 1. Technavio (2018), Global Orthobiologics Market Report. 9 2. Technavio (2015), Global Regenerative Medicine Market Report, retrieved September 26, 2017, from EMIS Professional Database. 9 Surgical & Sports Medicine Market Is An Underserved, High-Growth Market ~$6Bn+ Market Growing ~8% Annually Chronic Inflammatory And Bone Fusion Tendon and Ligament Injuries Degenerative Conditions (1) (2) (1) ~$2.7Bn ~$1.0Bn ~$2.4Bn Market size Market size Market size ◼ Includes spine fusion surgery and ◼ Includes rotator cuff and achilles◼ Includes osteoarthritis (OA), other bone graft substitutes tendon repairs tendonitis, plantar fasciitis OA affects ~667k ~250k Spine fusions annually in the U.S. Rotator cuff repairs and ~27mm in the U.S. ~40k Outpatient achilles tendon repairs in the U.S. annually Notes: 1. Technavio (2018), Global Orthobiologics Market Report. 9 2. Technavio (2015), Global Regenerative Medicine Market Report, retrieved September 26, 2017, from EMIS Professional Database.
10 Broad and Comprehensive Product Portfolio 1010 Broad and Comprehensive Product Portfolio 10
11 Comprehensive and Differentiated Commercial Product Portfolio Advanced Wound Care Only AWC / S&SM Surgical & Sports Medicine Only (3) ◼ Clinical Application: ◼ Clinical Applications: ◼ Clinical Application: (1) ‒ Venous leg ulcers‒ Chronic and acute wounds ‒ Orthopedic surgical procedures ‒ Diabetic foot ulcers‒ Surgical treatment of open wounds including bone fusion ◼ Regulatory Pathway: PMA◼ Regulatory Pathway: 510(k)◼ Regulatory Pathway: 361 HCT/P (Pursuing BLA for Biologic status) ◼ Clinical Application: ◼ Clinical Application: ◼ Clinical Application: ‒ Diabetic foot ulcers‒ Chronic and acute wounds‒ Chronic inflammatory and ◼ Regulatory Pathway: PMA‒ Tendon, ligament and other soft degenerative conditions; soft tissue injuries tissue injuries such as tendinosis ◼ Regulatory Pathway: 361 HCT/P and fasciitis ◼ Regulatory Pathway: 361 HCT/P (Pursuing BLA for Biologic status) PMA approval and robust clinical data set differentiates products and (2) facilitates private payor coverage Pursuing BLA approval to meet FDA and reimbursement ◼ Clinical Application: requirements and to unlock ‒ Chronic and acute wounds significant commercial opportunity ‒ Tendon, ligament and other soft tissue injuries ◼ Regulatory Pathway: 361 HCT/P Unique and broad applications across both markets Notes: rd 1. Except 3 degree burns. 11 2. Affinity production suspended in Q1 2019, product launch anticipated in H1 2020. 3. Minimal sales in AWC.11 Comprehensive and Differentiated Commercial Product Portfolio Advanced Wound Care Only AWC / S&SM Surgical & Sports Medicine Only (3) ◼ Clinical Application: ◼ Clinical Applications: ◼ Clinical Application: (1) ‒ Venous leg ulcers‒ Chronic and acute wounds ‒ Orthopedic surgical procedures ‒ Diabetic foot ulcers‒ Surgical treatment of open wounds including bone fusion ◼ Regulatory Pathway: PMA◼ Regulatory Pathway: 510(k)◼ Regulatory Pathway: 361 HCT/P (Pursuing BLA for Biologic status) ◼ Clinical Application: ◼ Clinical Application: ◼ Clinical Application: ‒ Diabetic foot ulcers‒ Chronic and acute wounds‒ Chronic inflammatory and ◼ Regulatory Pathway: PMA‒ Tendon, ligament and other soft degenerative conditions; soft tissue injuries tissue injuries such as tendinosis ◼ Regulatory Pathway: 361 HCT/P and fasciitis ◼ Regulatory Pathway: 361 HCT/P (Pursuing BLA for Biologic status) PMA approval and robust clinical data set differentiates products and (2) facilitates private payor coverage Pursuing BLA approval to meet FDA and reimbursement ◼ Clinical Application: requirements and to unlock ‒ Chronic and acute wounds significant commercial opportunity ‒ Tendon, ligament and other soft tissue injuries ◼ Regulatory Pathway: 361 HCT/P Unique and broad applications across both markets Notes: rd 1. Except 3 degree burns. 11 2. Affinity production suspended in Q1 2019, product launch anticipated in H1 2020. 3. Minimal sales in AWC.
12 Our Products Cover a Wide Range of Addressable Wounds Ability to Treat a Wide Range of Wounds Benefits of Broad AWC Portfolio ◼ Complete product portfolio serves as a key competitive Serves wide range of health care customers advantage ◼ PuraPly AM is the only first line antimicrobial skin (1) (2) substitute with PHMB for all wounds Enables IDN / GPO contracting ◼ Apligraf (DFUs and VLUs) and Dermagraft (DFUs) are PMA-approved products for complex wounds Facilitates patient-specific treatment protocols Chronic Wounds: VLUs, DFUs and Robust mind share among customers Pressure Ulcers Acute Wounds: Combination of PMA-approved, 510(k) and Traumatic Wounds 361 HCT/P products diversifies revenue and and Burns reimbursement mix Notes: 1. Polyhexamethylene biguanide. 12 rd 2. Except 3 degree burns.12 Our Products Cover a Wide Range of Addressable Wounds Ability to Treat a Wide Range of Wounds Benefits of Broad AWC Portfolio ◼ Complete product portfolio serves as a key competitive Serves wide range of health care customers advantage ◼ PuraPly AM is the only first line antimicrobial skin (1) (2) substitute with PHMB for all wounds Enables IDN / GPO contracting ◼ Apligraf (DFUs and VLUs) and Dermagraft (DFUs) are PMA-approved products for complex wounds Facilitates patient-specific treatment protocols Chronic Wounds: VLUs, DFUs and Robust mind share among customers Pressure Ulcers Acute Wounds: Combination of PMA-approved, 510(k) and Traumatic Wounds 361 HCT/P products diversifies revenue and and Burns reimbursement mix Notes: 1. Polyhexamethylene biguanide. 12 rd 2. Except 3 degree burns.
13 Our Products Treat Wounds Across All Stages Only First Line Antimicrobial Differentiated Amniotic PMA-Approved Why Wounds Stall in the Skin Substitute with PHMB for Portfolio Supported by Products for Complex Inflammatory Phase: (1) All Wounds Clinical Data DFUs and VLUs Bacterial bioburden & contamination (DFUs & VLUs) Protease activity (2) (e.g., MMPs ) (DFUs) Inflammatory cells & cytokine activity Impaired cellular signaling TIME Notes: rd 1. Except 3 degree burns. 13 2. Matrix metalloproteinases. Hemostatic phase13 Our Products Treat Wounds Across All Stages Only First Line Antimicrobial Differentiated Amniotic PMA-Approved Why Wounds Stall in the Skin Substitute with PHMB for Portfolio Supported by Products for Complex Inflammatory Phase: (1) All Wounds Clinical Data DFUs and VLUs Bacterial bioburden & contamination (DFUs & VLUs) Protease activity (2) (e.g., MMPs ) (DFUs) Inflammatory cells & cytokine activity Impaired cellular signaling TIME Notes: rd 1. Except 3 degree burns. 13 2. Matrix metalloproteinases. Hemostatic phase
14 We Have a Broad and Unique Portfolio in the Skin Substitute Market Skin Sub, Skin Sub Skin Sub, Skin Sub- Honey ,TCC Skin Sub- Skin Sub- Enzymatic Products Skin Sub Ultrasonic Sheet/Flowable (cast), Sheet/Flowable Sheet/Flowable Debrider, PDGF, Debrider Dressings NPWT, Dressings Human Cellular Bioengineered ✓ Graft Xenograft / Antimicrobial ✓✓ Xenograft ✓✓✓✓ Allograft ✓✓✓✓✓✓ (1) PMA / BLA 4 0 1 1 0 0 0 Approved Products Note: 1. Includes Gintuit. 1414 We Have a Broad and Unique Portfolio in the Skin Substitute Market Skin Sub, Skin Sub Skin Sub, Skin Sub- Honey ,TCC Skin Sub- Skin Sub- Enzymatic Products Skin Sub Ultrasonic Sheet/Flowable (cast), Sheet/Flowable Sheet/Flowable Debrider, PDGF, Debrider Dressings NPWT, Dressings Human Cellular Bioengineered ✓ Graft Xenograft / Antimicrobial ✓✓ Xenograft ✓✓✓✓ Allograft ✓✓✓✓✓✓ (1) PMA / BLA 4 0 1 1 0 0 0 Approved Products Note: 1. Includes Gintuit. 14
15 We Have a Broad Portfolio in the Surgical & Sports Medicine Market Multiple Multiple Dermal Orthobiologics, Template, Amniotic Tendon Amniotic Amniotic Amniotic Membrane, Reinforcement, Membrane, Membrane, Membrane, Collagen Sheets Platelet Rich, Hyaluronic Acid Products Amniotic Orthobiologics Orthobiologics Amniotic Amniotic and Powders Plasma Solutions Injections Amniotic Tendon Suspension, Suspension, Suspension, Suspension Reinforcement Xenograft Amniotic Tendon Membrane Reinforcement, Spine Fusion ✓✓✓ Extremity Fusion ✓✓✓ Tendon Repair ✓✓✓✓✓✓ OA Degenerative ✓✓✓✓✓ Acute Surgical Wound ✓✓✓✓✓ 1515 We Have a Broad Portfolio in the Surgical & Sports Medicine Market Multiple Multiple Dermal Orthobiologics, Template, Amniotic Tendon Amniotic Amniotic Amniotic Membrane, Reinforcement, Membrane, Membrane, Membrane, Collagen Sheets Platelet Rich, Hyaluronic Acid Products Amniotic Orthobiologics Orthobiologics Amniotic Amniotic and Powders Plasma Solutions Injections Amniotic Tendon Suspension, Suspension, Suspension, Suspension Reinforcement Xenograft Amniotic Tendon Membrane Reinforcement, Spine Fusion ✓✓✓ Extremity Fusion ✓✓✓ Tendon Repair ✓✓✓✓✓✓ OA Degenerative ✓✓✓✓✓ Acute Surgical Wound ✓✓✓✓✓ 15
16 Growth Strategy 1616 Growth Strategy 16
17 Strategic Initiatives & Catalysts for Growth Key Pillars of Growth Strategy ◼ Launch new products and invest in R&D◼ Continue to build compendium of clinical data ◼ Manufacturing and infrastructure enhancements to ◼ Penetrate additional sites of care improve gross margins ◼ Continue sales force expansion and optimization ◼ Expand payor and provider contracting efforts ◼ Pursue strategic M&A and in-licensing to leverage commercial infrastructure Anticipated Growth Drivers ◼ Relaunch/commercial ramp of Affinity product throughout 2020 ◼ Launch PuraPly XT and various PuraPly AM (PPAM) line extensions (New Sizes) Near-Term ◼ Proactive management of PuraPly pass-through status ◼ Launch NovaChor and other new placental products Medium-Term (2021 – 2022) ◼ Enter burn market with the launch of a burn portfolio (TransCyte, Biosynthetic Burn Wound Matrix, Etc.) ◼ Pursue BLA approvals for ReNu and NuCel for label indications and reimbursement Long-Term (2023+) ◼ Develop, in-license and/or acquire additional pipeline products 1717 Strategic Initiatives & Catalysts for Growth Key Pillars of Growth Strategy ◼ Launch new products and invest in R&D◼ Continue to build compendium of clinical data ◼ Manufacturing and infrastructure enhancements to ◼ Penetrate additional sites of care improve gross margins ◼ Continue sales force expansion and optimization ◼ Expand payor and provider contracting efforts ◼ Pursue strategic M&A and in-licensing to leverage commercial infrastructure Anticipated Growth Drivers ◼ Relaunch/commercial ramp of Affinity product throughout 2020 ◼ Launch PuraPly XT and various PuraPly AM (PPAM) line extensions (New Sizes) Near-Term ◼ Proactive management of PuraPly pass-through status ◼ Launch NovaChor and other new placental products Medium-Term (2021 – 2022) ◼ Enter burn market with the launch of a burn portfolio (TransCyte, Biosynthetic Burn Wound Matrix, Etc.) ◼ Pursue BLA approvals for ReNu and NuCel for label indications and reimbursement Long-Term (2023+) ◼ Develop, in-license and/or acquire additional pipeline products 17
18 Robust Product Pipeline Potential Timeline for Commercial Launch Medium-Term Long-Term 2019 2020 Product (2021 – 2022) (2023+) Product Description / Enhancement ◼ Enhanced thickness and PHMB content (1) Recently ◼ Allows for sustained presence of the antimicrobial barrier in the wound Diversify revenue ◼ Bioengineered porcine collagen surgical matrix Launched (1) and reimbursement ◼ High biomechanical strength per unit thickness mix ◼ Micronized particulate version of PuraPly ◼ Allows application in powder or gel form to deep and tunneling wounds ◼ Fresh chorionic membrane containing viable cells, growth factors/cytokines, and extracellular matrix (ECM) protein ◼ Received Q-code (Q4194), effective 1/1/2019 ◼ Bioengineered tissue scaffold that promotes burn healing ◼ Provides an outer protective barrier for bioactive dermal components, increases re-epithelialization and pain relief Entry into burn market Biosynthetic ◼ Biosynthetic wound matrix designed as a temporary covering for burn Burn Wound wounds prior to grafting or bioactive therapies. ◼ Provides a synthetic semipermeable barrier to manage severe wounds Matrix ▪ Manages complex chronic and acute wounds; as well as can act as a Cord barrier to support healing in surgical soft tissue procedures Membrane ▪ Thick and strong characteristics, room temp storage with long-shelf-life ◼ Continued development of fresh and dehydrated placental products Other Placental ◼ Acquisition opportunities to diversify portfolio to address additional Products clinical and market opportunities ◼ Continued data generation and BLA approval expected to drive step- function sales growth in large and underserved market BLA approval ◼ Commercial pilot launch in 2015 through 361 HCT/P pathway ◼ BLA approval expected to improve reimbursement backdrop and facilitate increased utilization BLA approval ◼ Commercially launched in 2009 through 361 HCT/P pathway Notes: 1. Product already launched on small scale. 18 New Launches BLA Approval Line-Extensions18 Robust Product Pipeline Potential Timeline for Commercial Launch Medium-Term Long-Term 2019 2020 Product (2021 – 2022) (2023+) Product Description / Enhancement ◼ Enhanced thickness and PHMB content (1) Recently ◼ Allows for sustained presence of the antimicrobial barrier in the wound Diversify revenue ◼ Bioengineered porcine collagen surgical matrix Launched (1) and reimbursement ◼ High biomechanical strength per unit thickness mix ◼ Micronized particulate version of PuraPly ◼ Allows application in powder or gel form to deep and tunneling wounds ◼ Fresh chorionic membrane containing viable cells, growth factors/cytokines, and extracellular matrix (ECM) protein ◼ Received Q-code (Q4194), effective 1/1/2019 ◼ Bioengineered tissue scaffold that promotes burn healing ◼ Provides an outer protective barrier for bioactive dermal components, increases re-epithelialization and pain relief Entry into burn market Biosynthetic ◼ Biosynthetic wound matrix designed as a temporary covering for burn Burn Wound wounds prior to grafting or bioactive therapies. ◼ Provides a synthetic semipermeable barrier to manage severe wounds Matrix ▪ Manages complex chronic and acute wounds; as well as can act as a Cord barrier to support healing in surgical soft tissue procedures Membrane ▪ Thick and strong characteristics, room temp storage with long-shelf-life ◼ Continued development of fresh and dehydrated placental products Other Placental ◼ Acquisition opportunities to diversify portfolio to address additional Products clinical and market opportunities ◼ Continued data generation and BLA approval expected to drive step- function sales growth in large and underserved market BLA approval ◼ Commercial pilot launch in 2015 through 361 HCT/P pathway ◼ BLA approval expected to improve reimbursement backdrop and facilitate increased utilization BLA approval ◼ Commercially launched in 2009 through 361 HCT/P pathway Notes: 1. Product already launched on small scale. 18 New Launches BLA Approval Line-Extensions
19 PuraPly – The Leader in Skin Substitute / AWC / S&SM Antimicrobial Space Product Description ◼ Patented, purified native porcine collagen matrix embedded with a broad spectrum antimicrobial ◼ “Pass-through” reimbursement status until 9/30/2020 (1) ◼ Only first line antimicrobial skin substitute with PHMB for all wounds ◼ Provides 3 Key Clinical Benefits: 1 Collagen matrix creates a durable biocompatible scaffold which promotes healing 2 Effective barrier against a wide array of microorganisms 3 Antimicrobial agent (PHMB) is known to inhibit the formation of biofilm on wound surfaces (biofilm management provides necessary support to proceed to wound closure) (3) Proven Clinical Outcomes Study Background ◼ Use of PuraPly AM in the management of Mean time to complete bioburden and treatment of chronic, nonhealing closure: 5.0 weeks wounds 90% ◼ Study duration of 24 weeks and primary efficacy 68% analyzed at 12 weeks; n=63 ◼ Baseline wound statistics: 2 − Wound area (median): 6.5 cm − Wound duration (mean): 4 months Wounds that Demonstrated a Wounds that Achieved (2) ◼ All wound types studied Reduction in Area Complete Closure Note: 3. Bain et al. (2019). (2019). Effect of Native Type I Collagen with rd 1. Except 3 degree burns. Polyhexamethylene Biguanide Antimicrobial on Wounds: Interim 19 2. 29% venous ulcers; 22% trauma and laceration; 16% post surgical Registry Results. Plastic and reconstructive surgery. Global open, wounds; 13% pressure ulcers; 10% diabetic ulcers; 10% other. 7(6), e2251. doi:10.1097/GOX.0000000000002251.19 PuraPly – The Leader in Skin Substitute / AWC / S&SM Antimicrobial Space Product Description ◼ Patented, purified native porcine collagen matrix embedded with a broad spectrum antimicrobial ◼ “Pass-through” reimbursement status until 9/30/2020 (1) ◼ Only first line antimicrobial skin substitute with PHMB for all wounds ◼ Provides 3 Key Clinical Benefits: 1 Collagen matrix creates a durable biocompatible scaffold which promotes healing 2 Effective barrier against a wide array of microorganisms 3 Antimicrobial agent (PHMB) is known to inhibit the formation of biofilm on wound surfaces (biofilm management provides necessary support to proceed to wound closure) (3) Proven Clinical Outcomes Study Background ◼ Use of PuraPly AM in the management of Mean time to complete bioburden and treatment of chronic, nonhealing closure: 5.0 weeks wounds 90% ◼ Study duration of 24 weeks and primary efficacy 68% analyzed at 12 weeks; n=63 ◼ Baseline wound statistics: 2 − Wound area (median): 6.5 cm − Wound duration (mean): 4 months Wounds that Demonstrated a Wounds that Achieved (2) ◼ All wound types studied Reduction in Area Complete Closure Note: 3. Bain et al. (2019). (2019). Effect of Native Type I Collagen with rd 1. Except 3 degree burns. Polyhexamethylene Biguanide Antimicrobial on Wounds: Interim 19 2. 29% venous ulcers; 22% trauma and laceration; 16% post surgical Registry Results. Plastic and reconstructive surgery. Global open, wounds; 13% pressure ulcers; 10% diabetic ulcers; 10% other. 7(6), e2251. doi:10.1097/GOX.0000000000002251.
20 PuraPly XT – Launched February 2020 AWC / S&SM Product Description ◼ Five-layer, native, cross-linked ECM+broad spectrum PHMB antimicrobial barrier for larger more complex wounds 1 ◼ Cross-linked ECM resists degradation in wounds, supporting persistence between debridements 2,3,4 ◼ A five-layer ECM maximizes surface area for PHMB saturation 2,3,5 5,6,7 ◼ PHMB proactively disrupts bioburden and has high tissue compatibility and low cytotoxicity 2 ◼ XT is supplied dry in sheet form, packaged in sterile, sealed single pouches for most wound types Indications Size & SKUs 2020 PuraPly XT – Launched February 2020 AWC / S&SM Product Description ◼ Five-layer, native, cross-linked ECM+broad spectrum PHMB antimicrobial barrier for larger more complex wounds 1 ◼ Cross-linked ECM resists degradation in wounds, supporting persistence between debridements 2,3,4 ◼ A five-layer ECM maximizes surface area for PHMB saturation 2,3,5 5,6,7 ◼ PHMB proactively disrupts bioburden and has high tissue compatibility and low cytotoxicity 2 ◼ XT is supplied dry in sheet form, packaged in sterile, sealed single pouches for most wound types Indications Size & SKUs 20
21 Measures Taken to Position PuraPly Post Pass-Through Pass-Through Situation Overview ◼ PuraPly benefits from “pass-through” reimbursement specific to outpatient wound care centers and ASC − CMS provides additional reimbursement above the procedure’s bundled payment for certain products ◼ Pass-through status ended (temporarily) on 12/31/17 ◼ Pass-through status restored effective Oct. 1, 2018 through Sep. 30, 2020 Other Organogenesis Growth Drivers Expected Proactive Measures Taken With PuraPly to Offset Impact of PuraPly ◼ Affinity relaunch in H1 2020 hits stride in 2021 1 1 ◼ Increased penetration in physician offices, where PuraPly is reimbursed at cost-plus 2◼ New revenue stream from TransCyte in medium term 3◼ Non-PuraPly revenues grew at a 22% CAGR from 2017 2◼ New smaller, lower-priced SKUs under bundle price to 2019 3◼ Invested in clinical data to facilitate private payor coverage − Continued sales force expansion and customer growth − Robust growth in S&SM channel ◼ Introduction of innovative line extensions: PuraPly XT and new 4 sizing options − Launch of NovaChor into the Hospital Outpatient setting/SSM markets PuraPly is now well-established and regarded in the marketplace with increasing physician adoption and penetration PuraPly is well positioned for robust revenue growth following initial dip Notes: 1. Subject to regulatory approval. 2121 Measures Taken to Position PuraPly Post Pass-Through Pass-Through Situation Overview ◼ PuraPly benefits from “pass-through” reimbursement specific to outpatient wound care centers and ASC − CMS provides additional reimbursement above the procedure’s bundled payment for certain products ◼ Pass-through status ended (temporarily) on 12/31/17 ◼ Pass-through status restored effective Oct. 1, 2018 through Sep. 30, 2020 Other Organogenesis Growth Drivers Expected Proactive Measures Taken With PuraPly to Offset Impact of PuraPly ◼ Affinity relaunch in H1 2020 hits stride in 2021 1 1 ◼ Increased penetration in physician offices, where PuraPly is reimbursed at cost-plus 2◼ New revenue stream from TransCyte in medium term 3◼ Non-PuraPly revenues grew at a 22% CAGR from 2017 2◼ New smaller, lower-priced SKUs under bundle price to 2019 3◼ Invested in clinical data to facilitate private payor coverage − Continued sales force expansion and customer growth − Robust growth in S&SM channel ◼ Introduction of innovative line extensions: PuraPly XT and new 4 sizing options − Launch of NovaChor into the Hospital Outpatient setting/SSM markets PuraPly is now well-established and regarded in the marketplace with increasing physician adoption and penetration PuraPly is well positioned for robust revenue growth following initial dip Notes: 1. Subject to regulatory approval. 21
22 Affinity – Relaunch/Commercial Ramp in 2020 AWC / S&SM Product Description ◼ Unique Fresh amniotic membrane containing many types of viable cells, growth factors/cytokines, and ECM proteins ‒ Manages chronic and acute wounds, as well as tendon, ligament and other soft tissue injuries ‒ Only fresh amniotic membrane and one of only a few amniotic tissue products containing viable amniotic cells ◼ Production resumed in Q1 2020 after moving to new contract manufacturer ‒ Relaunch/Commercial ramp in progress (2020) ◼ Product demand grew from first launch in 2014 and sales continued to increase through 2018 ‒ Expected to be source of organic growth in 2020 and 2021 (1)(2) (2) Demonstrated Clinical Results Broadly Improved Wounds Compared to SoC % of DFU wounds closed 82% 81% 63% 60% 65% 58% 58% 38% 38% 39% > 60% reduction in area > 60% reduction in > 75% reduction in 12 Weeks 16 Weeks depth volume Affinity & SoC (N=38) Standard of Care (SoC) (N=38) Note: foot ulcers. Journal of comparative effectiveness research, (0). 1. Adjusted Cox Analysis. 22 2. Serena et al. (2019). A randomized controlled clinical trial of a hypothermically stored amniotic membrane for use in diabetic 22 Affinity – Relaunch/Commercial Ramp in 2020 AWC / S&SM Product Description ◼ Unique Fresh amniotic membrane containing many types of viable cells, growth factors/cytokines, and ECM proteins ‒ Manages chronic and acute wounds, as well as tendon, ligament and other soft tissue injuries ‒ Only fresh amniotic membrane and one of only a few amniotic tissue products containing viable amniotic cells ◼ Production resumed in Q1 2020 after moving to new contract manufacturer ‒ Relaunch/Commercial ramp in progress (2020) ◼ Product demand grew from first launch in 2014 and sales continued to increase through 2018 ‒ Expected to be source of organic growth in 2020 and 2021 (1)(2) (2) Demonstrated Clinical Results Broadly Improved Wounds Compared to SoC % of DFU wounds closed 82% 81% 63% 60% 65% 58% 58% 38% 38% 39% > 60% reduction in area > 60% reduction in > 75% reduction in 12 Weeks 16 Weeks depth volume Affinity & SoC (N=38) Standard of Care (SoC) (N=38) Note: foot ulcers. Journal of comparative effectiveness research, (0). 1. Adjusted Cox Analysis. 22 2. Serena et al. (2019). A randomized controlled clinical trial of a hypothermically stored amniotic membrane for use in diabetic
23 NovaChor – Expected Commercial Launch 2021 AWC / S&SM Product Description ◼ Next in line for our advanced fresh tissue technology ◼ Fresh hypothermically stored chorion membrane containing viable cells, growth factors/cytokines, and ECM proteins ‒ Manages chronic and acute wounds; as well as surgical deep and tunneling wounds ‒ Maintains cell viability through expiration ‒ Thicker graft with no orientation requirements and improves handling ◼ Commercial launch planned for 2021 ‒ Expected to be source of organic growth in 2021 and 2022+ 1 1 Presence Key Factors Growth Factors, Cytokines, and Protease Inhibitors 10000 1000 H&E HA 100 10 1 ANG-2 ANG HGF IGFBP-1 IGF-1 TGF-B1 TIMP-1 TIMP-2 HGF IGF-1 Note: 1. Data on file 23 2 pg/cm23 NovaChor – Expected Commercial Launch 2021 AWC / S&SM Product Description ◼ Next in line for our advanced fresh tissue technology ◼ Fresh hypothermically stored chorion membrane containing viable cells, growth factors/cytokines, and ECM proteins ‒ Manages chronic and acute wounds; as well as surgical deep and tunneling wounds ‒ Maintains cell viability through expiration ‒ Thicker graft with no orientation requirements and improves handling ◼ Commercial launch planned for 2021 ‒ Expected to be source of organic growth in 2021 and 2022+ 1 1 Presence Key Factors Growth Factors, Cytokines, and Protease Inhibitors 10000 1000 H&E HA 100 10 1 ANG-2 ANG HGF IGFBP-1 IGF-1 TGF-B1 TIMP-1 TIMP-2 HGF IGF-1 Note: 1. Data on file 23 2 pg/cm
24 Cord Membrane AWC / S&SM Product Description ◼ Umbilical cord membrane (UCM) retaining the native collagen and hyaluronic acid-rich extracellular matrix (ECM), and growth factors found in placental tissue. ‒ Indicated as wound cover to manage chronic and acute wounds, and as a barrier in surgical soft tissue procedures ‒ Design objective is to develop a room temperature stable graft with a 2-year shelf life ◼ Planning to initiate large scale RCT for chronic wounds 1 1 Tissue Structure More HA Content 60 50 40 30 20 10 H&E 0 UCM Dehydrated AM/CM Dehydrated Amnion/Chorion Membrane Note: 1. Data on file 24 2 mg/cm24 Cord Membrane AWC / S&SM Product Description ◼ Umbilical cord membrane (UCM) retaining the native collagen and hyaluronic acid-rich extracellular matrix (ECM), and growth factors found in placental tissue. ‒ Indicated as wound cover to manage chronic and acute wounds, and as a barrier in surgical soft tissue procedures ‒ Design objective is to develop a room temperature stable graft with a 2-year shelf life ◼ Planning to initiate large scale RCT for chronic wounds 1 1 Tissue Structure More HA Content 60 50 40 30 20 10 H&E 0 UCM Dehydrated AM/CM Dehydrated Amnion/Chorion Membrane Note: 1. Data on file 24 2 mg/cm
25 NuShield – Versatile Tissue Graft Covering AWC / S&SM Full Spectrum of Acute & Chronic Wounds Product Description ◼ Dehydrated placental tissue graft that is topically or surgically applied to target tissue ◼ Recent robust growth driven by leveraging Organogenesis commercial infrastructure ◼ Product highlights: − More complete, more versatile dehydrated Allograft skin substitute 1 − Biologic characteristics support health of soft tissue defects, especially in difficult to heal locations or 2 challenging patient populations ◼ Unimpeded growth anticipated in the near-term following resolution of supply constraints in 2019 (1) Proven to Close Wounds % of wounds closed 100% 85% 59% 57% 56% 43% 16 Weeks 24 Weeks VLU (N=14) DFU (N=24) Other (N=12) Note: 1. Caporusso et al. (2019). Clinical experience using a dehydrated amnion/chorion membrane construct for the management of wounds. 25 Wounds: a compendium of clinical research and practice, 31(4 Suppl), S19-S27. 25 NuShield – Versatile Tissue Graft Covering AWC / S&SM Full Spectrum of Acute & Chronic Wounds Product Description ◼ Dehydrated placental tissue graft that is topically or surgically applied to target tissue ◼ Recent robust growth driven by leveraging Organogenesis commercial infrastructure ◼ Product highlights: − More complete, more versatile dehydrated Allograft skin substitute 1 − Biologic characteristics support health of soft tissue defects, especially in difficult to heal locations or 2 challenging patient populations ◼ Unimpeded growth anticipated in the near-term following resolution of supply constraints in 2019 (1) Proven to Close Wounds % of wounds closed 100% 85% 59% 57% 56% 43% 16 Weeks 24 Weeks VLU (N=14) DFU (N=24) Other (N=12) Note: 1. Caporusso et al. (2019). Clinical experience using a dehydrated amnion/chorion membrane construct for the management of wounds. 25 Wounds: a compendium of clinical research and practice, 31(4 Suppl), S19-S27.
26 Pursuing BLA Approval for ReNu to Open Up Large and Growing Market Opportunity S&SM Product Description Market Opportunity ◼ Cryopreserved suspension of amniotic fluid cells and morselized amnion tissue from the same donor − Formulated for office use (injection) ~$2.4bn − Primary application is treatment of Knee Market opportunity Osteoarthritis (OA) for reduced pain and improved for HA injection function (1) treatment options − Multiple additional applications for soft tissues including Hip OA and joint and tendon injuries, such ~27mm as tendinosis and fasciitis Americans with OA driven by aging, ◼ Product already being sold in market today obesity and − First launched in 2015 sports injuries − Predominantly cash pay − Significant reimbursement potential unlocked through BLA pathway 7.3% Market growth for HA ◼ Currently registered as a 361 HCT/P (1) injections − BLA Registration required to continue to market the product long-term ◼ Initial 200 patient trial completed for BLA program; Phase III study to be initiated in 2020 Note: 1. Technavio (2018), Global Orthobiologics Market Report; market opportunity represents global market for viscosupplements which are intra- 26 articular injections of hyaluronic acid.26 Pursuing BLA Approval for ReNu to Open Up Large and Growing Market Opportunity S&SM Product Description Market Opportunity ◼ Cryopreserved suspension of amniotic fluid cells and morselized amnion tissue from the same donor − Formulated for office use (injection) ~$2.4bn − Primary application is treatment of Knee Market opportunity Osteoarthritis (OA) for reduced pain and improved for HA injection function (1) treatment options − Multiple additional applications for soft tissues including Hip OA and joint and tendon injuries, such ~27mm as tendinosis and fasciitis Americans with OA driven by aging, ◼ Product already being sold in market today obesity and − First launched in 2015 sports injuries − Predominantly cash pay − Significant reimbursement potential unlocked through BLA pathway 7.3% Market growth for HA ◼ Currently registered as a 361 HCT/P (1) injections − BLA Registration required to continue to market the product long-term ◼ Initial 200 patient trial completed for BLA program; Phase III study to be initiated in 2020 Note: 1. Technavio (2018), Global Orthobiologics Market Report; market opportunity represents global market for viscosupplements which are intra- 26 articular injections of hyaluronic acid.
27 Clinical Data suggests improved patient outcomes S&SM ◼ Clinical significance in Knee Osteoarthritis outcome compared to commercially available Hyaluronic acid (“HA”) and placebo (Saline) over 6 months − Less pain and demonstrated improvements in patient-reported outcomes ◼ Patient-blinded, randomized, controlled clinical trial had an enrollment of 200 adult patients (ReNu = 68 patients, HA = 64 patients and saline = 68 patients) (1) (1) Lower Pain Scores Higher Response Rate ReNu vs. HA ReNu vs. HA, Saline * P < 0.01 *** p < 0.001 80% # P < 0.01 ReNu vs. HA, Saline 120 *** # * 100 60% 80 60 40% 40 20 0 20% Baseline 1 week 6 weeks 3 months 6 months OMERACT-OARSI Simplified AS Re ReN N Au u HA Saline ReNu HA Saline V Vi is su ua al l Ana Anal lo og gu ue e S Sc ca al le e ( (V VAS) AS) Ave Averag rage e ± ± stand standard ard d dev eviatio iation n repo reported rted fo for VA r VAS S o ov verall erall p pain ain Notes: 1. Farr et al. (2019). A Randomized Controlled Single-Blind Study Demonstrating Superiority of Amniotic Suspension Allograft Injection Over 27 Hyaluronic Acid and Saline Control for Modification of Knee Osteoarthritis Symptoms. Journal of Knee Surgery. DOI: 10.1055/s-0039-1696672. VAS Overall Pain Responder Rate27 Clinical Data suggests improved patient outcomes S&SM ◼ Clinical significance in Knee Osteoarthritis outcome compared to commercially available Hyaluronic acid (“HA”) and placebo (Saline) over 6 months − Less pain and demonstrated improvements in patient-reported outcomes ◼ Patient-blinded, randomized, controlled clinical trial had an enrollment of 200 adult patients (ReNu = 68 patients, HA = 64 patients and saline = 68 patients) (1) (1) Lower Pain Scores Higher Response Rate ReNu vs. HA ReNu vs. HA, Saline * P < 0.01 *** p < 0.001 80% # P < 0.01 ReNu vs. HA, Saline 120 *** # * 100 60% 80 60 40% 40 20 0 20% Baseline 1 week 6 weeks 3 months 6 months OMERACT-OARSI Simplified AS Re ReN N Au u HA Saline ReNu HA Saline V Vi is su ua al l Ana Anal lo og gu ue e S Sc ca al le e ( (V VAS) AS) Ave Averag rage e ± ± stand standard ard d dev eviatio iation n repo reported rted fo for VA r VAS S o ov verall erall p pain ain Notes: 1. Farr et al. (2019). A Randomized Controlled Single-Blind Study Demonstrating Superiority of Amniotic Suspension Allograft Injection Over 27 Hyaluronic Acid and Saline Control for Modification of Knee Osteoarthritis Symptoms. Journal of Knee Surgery. DOI: 10.1055/s-0039-1696672. VAS Overall Pain Responder Rate
28 NuCel – Amniotic-Derived Allograft for Surgical S&SM Procedures Product Description ◼ Surgically implanted allograft derived from human amniotic tissue and amniotic fluid ◼ Supports tissue healing in spinal and orthopedic surgical applications (i.e., bone growth and fusion) ◼ Launched in 2009 ◼ Seeking BLA approval to meet FDA requirements for continued marketing ◼ BLA approval expected to improve reimbursement backdrop and facilitate increased utilization ◼ Expecting to initiate Phase III clinical trial in Q1-2021 to support BLA program ◼ Clinical trials demonstrated an ability to achieve kinematic fusion and effectiveness in treating patients with comorbidities (1) (1) Proven to Achieve Kinematic Fusion Study Overview % of patients achieving kinematic fusion ◼ Patients received a one or two level lumbar interbody fusion with NuCel 100% 97% ◼ Baseline comorbidities were present in 90% of one-level patients and 88% of two-level patients ◼ No adverse events related to NuCel were reported One-level (N=38) Two-level (N=34) Note: 1. Nunley et al. (2016). Preliminary results of bioactive amniotic suspension with allograft for achieving one and two-level lumbar interbody 28 fusion. International journal of spine surgery, 10, 12.28 NuCel – Amniotic-Derived Allograft for Surgical S&SM Procedures Product Description ◼ Surgically implanted allograft derived from human amniotic tissue and amniotic fluid ◼ Supports tissue healing in spinal and orthopedic surgical applications (i.e., bone growth and fusion) ◼ Launched in 2009 ◼ Seeking BLA approval to meet FDA requirements for continued marketing ◼ BLA approval expected to improve reimbursement backdrop and facilitate increased utilization ◼ Expecting to initiate Phase III clinical trial in Q1-2021 to support BLA program ◼ Clinical trials demonstrated an ability to achieve kinematic fusion and effectiveness in treating patients with comorbidities (1) (1) Proven to Achieve Kinematic Fusion Study Overview % of patients achieving kinematic fusion ◼ Patients received a one or two level lumbar interbody fusion with NuCel 100% 97% ◼ Baseline comorbidities were present in 90% of one-level patients and 88% of two-level patients ◼ No adverse events related to NuCel were reported One-level (N=38) Two-level (N=34) Note: 1. Nunley et al. (2016). Preliminary results of bioactive amniotic suspension with allograft for achieving one and two-level lumbar interbody 28 fusion. International journal of spine surgery, 10, 12.
29 TransCyte, in our Burn Portfolio, is an Approved Product in an Attractive Market with Limited Competition Advanced Wound Care Product Description Market Opportunity nd rd ◼ Targeted at 2 and 3 degree burns ~500,000 burns annually that require medical attention − Bioengineered tissue scaffold that promotes burn healing − Provides bioactive dermal components and outer protective ~40,000 burns annually that require barrier hospitalization − Increases re-epithelialization and pain relief ◼ PMA-approved product supported by robust data; well- We believe TransCyte regarded by customers has the ability to − Requires manufacturing re-validation to re-launch product address a ~$200mm market opportunity − Expected launch in medium-term (2021 – 2022) ◼ Burn market is sizeable and concentrated Limited competition opportunity – Currently only one other PMA − Over 60% of U.S. acute hospitalizations related to burn injury approved product on the market (1) were admitted to 128 burn centers − Penetrate market with small specialty sales force and open up (2) Faster Wound Healing cross-selling opportunities Mean days to ≥ 90% wound epithelialization 18 11 TransCyte Silver Sulfadiazine Cream Notes: 1. American Burn Association. 29 2. Noordenbos et al (1999). Safety and efficacy of TransCyte* for the treatment of partial-thickness burns. Journal of burn care & rehabilitation, 20(4), 275-281.29 TransCyte, in our Burn Portfolio, is an Approved Product in an Attractive Market with Limited Competition Advanced Wound Care Product Description Market Opportunity nd rd ◼ Targeted at 2 and 3 degree burns ~500,000 burns annually that require medical attention − Bioengineered tissue scaffold that promotes burn healing − Provides bioactive dermal components and outer protective ~40,000 burns annually that require barrier hospitalization − Increases re-epithelialization and pain relief ◼ PMA-approved product supported by robust data; well- We believe TransCyte regarded by customers has the ability to − Requires manufacturing re-validation to re-launch product address a ~$200mm market opportunity − Expected launch in medium-term (2021 – 2022) ◼ Burn market is sizeable and concentrated Limited competition opportunity – Currently only one other PMA − Over 60% of U.S. acute hospitalizations related to burn injury approved product on the market (1) were admitted to 128 burn centers − Penetrate market with small specialty sales force and open up (2) Faster Wound Healing cross-selling opportunities Mean days to ≥ 90% wound epithelialization 18 11 TransCyte Silver Sulfadiazine Cream Notes: 1. American Burn Association. 29 2. Noordenbos et al (1999). Safety and efficacy of TransCyte* for the treatment of partial-thickness burns. Journal of burn care & rehabilitation, 20(4), 275-281.
30 Financial Profile 3030 Financial Profile 30
31 Attractive Revenue and Margin Profile Financial Profile Advanced Wound Care ($ in millions) % growth CAGR: 23% Surgical & Sports Medicine $261 $40 $199 $193 $20 $29 $139 % growth: 6% $221 $69 $179 $65 $164 $9 $10 $60 $55 (1) 2016 2017 2018 2019 2Q19 2Q20 PuraPly $62 $109 $70 $127 $30 $29 Revenue Ex- PuraPly $76 $89 $124 $134 $35 $40 Revenue % Gross 65% 69% 64% 71% 70% 71% Margin Note: 1. PuraPly exited pass-through on 12/31/17 and entered pass-through status again on 10/1/18 and will exit on 31 9/30/20.31 Attractive Revenue and Margin Profile Financial Profile Advanced Wound Care ($ in millions) % growth CAGR: 23% Surgical & Sports Medicine $261 $40 $199 $193 $20 $29 $139 % growth: 6% $221 $69 $179 $65 $164 $9 $10 $60 $55 (1) 2016 2017 2018 2019 2Q19 2Q20 PuraPly $62 $109 $70 $127 $30 $29 Revenue Ex- PuraPly $76 $89 $124 $134 $35 $40 Revenue % Gross 65% 69% 64% 71% 70% 71% Margin Note: 1. PuraPly exited pass-through on 12/31/17 and entered pass-through status again on 10/1/18 and will exit on 31 9/30/20.
32 Income Statement (1) ($ in millions) 2018 2019 2Q19 2Q20 Net Revenue $193 $261 $65 $69 % Growth (3)% 35% 49% 6% Gross Profit $125 $185 $46 $49 % Margin 64% 71% 70% 71% Operating $176 $214 $53 $51 Expenses Loss from ($52) ($29) ($7) ($2) Operations Net Loss ($65) ($40) ($10) ($5) Adjusted EBITDA ($36) ($18) ($5) $0 Note: 1. PuraPly exited pass-through on 12/31/17 and entered pass-through status again on 10/1/18. 3232 Income Statement (1) ($ in millions) 2018 2019 2Q19 2Q20 Net Revenue $193 $261 $65 $69 % Growth (3)% 35% 49% 6% Gross Profit $125 $185 $46 $49 % Margin 64% 71% 70% 71% Operating $176 $214 $53 $51 Expenses Loss from ($52) ($29) ($7) ($2) Operations Net Loss ($65) ($40) ($10) ($5) Adjusted EBITDA ($36) ($18) ($5) $0 Note: 1. PuraPly exited pass-through on 12/31/17 and entered pass-through status again on 10/1/18. 32
33 2020 Guidance Fiscal Year 2020 Revenue Guidance: For the twelve months ending December 31, 2020, the Company expects: • Net revenue of between $273 million and $277 million, representing growth of approximately 5% to 6% year-over-year, as compared to net revenue of $261 million for the twelve months ended December 31, 2019. • The 2020 net revenue guidance range assumes: o Net revenue from Advanced Wound Care products of between $236 million and $238 million, representing growth of approximately 7% to 8% year-over-year as compared to net revenue of $221 million for the twelve months ended December 31, 2019. o Net revenue from Surgical & Sports Medicine products of between $37 million and $39 million, representing a decrease of approximately 3% to 8% year-over-year as compared to net revenue of $40 million for the twelve months ended December 31, 2019. o Net revenue from the sale of PuraPly products of between $108 million and $110 million, representing a decrease of approximately 13% to 15% year-over-year, as compared to net revenue of $127 million for the twelve months ended December 31, 2019. 3333 2020 Guidance Fiscal Year 2020 Revenue Guidance: For the twelve months ending December 31, 2020, the Company expects: • Net revenue of between $273 million and $277 million, representing growth of approximately 5% to 6% year-over-year, as compared to net revenue of $261 million for the twelve months ended December 31, 2019. • The 2020 net revenue guidance range assumes: o Net revenue from Advanced Wound Care products of between $236 million and $238 million, representing growth of approximately 7% to 8% year-over-year as compared to net revenue of $221 million for the twelve months ended December 31, 2019. o Net revenue from Surgical & Sports Medicine products of between $37 million and $39 million, representing a decrease of approximately 3% to 8% year-over-year as compared to net revenue of $40 million for the twelve months ended December 31, 2019. o Net revenue from the sale of PuraPly products of between $108 million and $110 million, representing a decrease of approximately 13% to 15% year-over-year, as compared to net revenue of $127 million for the twelve months ended December 31, 2019. 33
34 2020 Q2 Form 10-Q Income Statement Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Net revenue $ 68,960 $ 64,948 $ 130,692 $ 122,071 Cost of goods sold 20,042 19,446 38,835 36,426 Gross profit 48,918 45,502 91,857 85,645 Operating expenses: Selling, general and administrative 46,502 48,957 99,115 97,850 Research and development 4,668 3,864 10,078 7,235 Total operating expenses 51,170 52,821 109,193 105,085 Loss from operations (2,252 ) (7,319 ) (17,336 ) (19,440 ) Other expense, net: Interest expense, net (2,912 ) (2,187 ) (5,422 ) (3,965 ) Loss on the extinguishment of debt - - - (1,862 ) Gain on settlement of deferred acquisition consideration - - 1,295 - Other income (expense), net 25 (120 ) 46 12 Total other expense, net (2,887 ) (2,307 ) (4,081 ) (5,815 ) Net loss before income taxes (5,139 ) (9,626 ) (21,417 ) (25,255 ) Income tax expense (27 ) (23 ) (62 ) (60 ) Net loss $ (5,166 ) $ (9,649 ) $ (21,479 ) $ (25,315 ) Net loss per share —basic and diluted $ (0.05 ) $ (0.11 ) $ (0.21 ) $ (0.28 ) Weighted-average common shares outstanding—basic and diluted 104,714,725 90,647,352 104,600,825 90,625,850 34 C CON ONFID FIDEN ENTIAL TIAL34 2020 Q2 Form 10-Q Income Statement Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Net revenue $ 68,960 $ 64,948 $ 130,692 $ 122,071 Cost of goods sold 20,042 19,446 38,835 36,426 Gross profit 48,918 45,502 91,857 85,645 Operating expenses: Selling, general and administrative 46,502 48,957 99,115 97,850 Research and development 4,668 3,864 10,078 7,235 Total operating expenses 51,170 52,821 109,193 105,085 Loss from operations (2,252 ) (7,319 ) (17,336 ) (19,440 ) Other expense, net: Interest expense, net (2,912 ) (2,187 ) (5,422 ) (3,965 ) Loss on the extinguishment of debt - - - (1,862 ) Gain on settlement of deferred acquisition consideration - - 1,295 - Other income (expense), net 25 (120 ) 46 12 Total other expense, net (2,887 ) (2,307 ) (4,081 ) (5,815 ) Net loss before income taxes (5,139 ) (9,626 ) (21,417 ) (25,255 ) Income tax expense (27 ) (23 ) (62 ) (60 ) Net loss $ (5,166 ) $ (9,649 ) $ (21,479 ) $ (25,315 ) Net loss per share —basic and diluted $ (0.05 ) $ (0.11 ) $ (0.21 ) $ (0.28 ) Weighted-average common shares outstanding—basic and diluted 104,714,725 90,647,352 104,600,825 90,625,850 34 C CON ONFID FIDEN ENTIAL TIAL
35 2020 Q2 Form 10-Q Balance Sheet June 30, December 31, 2020 2019 Assets Current assets: Cash $ 40,455 $ 60,174 Restricted cash 299 196 Accounts receivable, net 44,024 39,359 Inventory 28,562 22,918 Prepaid expenses and other current assets 4,366 2,953 Total current assets 117,706 125,600 Property and equipment, net 53,033 47,184 Notes receivable from related parties 302 556 Intangible assets, net 19,164 20,797 Goodwill 25,539 25,539 Deferred tax asset 15 127 Other assets 728 884 Total assets $ 216,487 $ 220,687 Liabilities and Stockholders’ Equity Current liabilities: Deferred acquisition consideration $ 1,432 $ 5,000 Current portion of term loan 6,667 - Current portion of capital lease obligations 3,327 3,057 Accounts payable 29,944 28,387 Accrued expenses and other current liabilities 24,688 23,450 Total current liabilities 66,058 59,894 Line of credit 39,353 33,484 Term loan, net of current portion 52,954 49,634 Deferred rent 1,097 1,012 Capital lease obligations, net of current portion 13,011 14,431 Other liabilities 8,264 6,649 Total liabilities 180,737 165,104 Commitments and contingencies (Note 13) Stockholders’ equity: Common stock, $0.0001 par value; 400,000,000 shares authorized; 106,145,716 and 105,599,434 shares issued; 105,417,168 and 104,870,886 shares outstanding at June 30, 2020 and December 31, 2019, respectively. 11 10 Additional paid-in capital 228,225 226,580 Accumulated deficit (192,486 ) (171,007 ) Total stockholders’ equity 35,750 55,583 Total liabilities and stockholders’ equity $ 216,487 $ 220,687 35 C CON ONFID FIDEN ENTIAL TIAL35 2020 Q2 Form 10-Q Balance Sheet June 30, December 31, 2020 2019 Assets Current assets: Cash $ 40,455 $ 60,174 Restricted cash 299 196 Accounts receivable, net 44,024 39,359 Inventory 28,562 22,918 Prepaid expenses and other current assets 4,366 2,953 Total current assets 117,706 125,600 Property and equipment, net 53,033 47,184 Notes receivable from related parties 302 556 Intangible assets, net 19,164 20,797 Goodwill 25,539 25,539 Deferred tax asset 15 127 Other assets 728 884 Total assets $ 216,487 $ 220,687 Liabilities and Stockholders’ Equity Current liabilities: Deferred acquisition consideration $ 1,432 $ 5,000 Current portion of term loan 6,667 - Current portion of capital lease obligations 3,327 3,057 Accounts payable 29,944 28,387 Accrued expenses and other current liabilities 24,688 23,450 Total current liabilities 66,058 59,894 Line of credit 39,353 33,484 Term loan, net of current portion 52,954 49,634 Deferred rent 1,097 1,012 Capital lease obligations, net of current portion 13,011 14,431 Other liabilities 8,264 6,649 Total liabilities 180,737 165,104 Commitments and contingencies (Note 13) Stockholders’ equity: Common stock, $0.0001 par value; 400,000,000 shares authorized; 106,145,716 and 105,599,434 shares issued; 105,417,168 and 104,870,886 shares outstanding at June 30, 2020 and December 31, 2019, respectively. 11 10 Additional paid-in capital 228,225 226,580 Accumulated deficit (192,486 ) (171,007 ) Total stockholders’ equity 35,750 55,583 Total liabilities and stockholders’ equity $ 216,487 $ 220,687 35 C CON ONFID FIDEN ENTIAL TIAL
36 Six Months Ended 2020 Q2 Form 10-Q Cash Flow Statement June 30, 2020 2019 Cash flows from operating activities: Net loss $ (21,479 ) $ (25,315 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 1,793 1,761 Amortization of intangible assets 1,633 2,997 Non-cash interest expense 103 154 Deferred interest expense 1,022 536 Deferred rent expense 64 326 Gain on settlement of deferred acquisition consideration (1,295 ) - Provision recorded for sales returns and doubtful accounts 970 27 Loss on disposal of property and equipment 201 - Adjustment for excess and obsolete inventories 1,709 523 Stock-based compensation 678 458 Loss on extinguishment of debt - 1,862 Changes in operating assets and liabilities: Accounts receivable (5,727 ) 723 Inventory (7,353 ) (6,087 ) Prepaid expenses and other current assets (1,302 ) (785 ) Accounts payable 235 1,473 Accrued expenses and other current liabilities 1,266 122 Other liabilities 864 (449 ) Net cash used in operating activities (26,618 ) (21,674 ) Cash flows from investing activities: Purchases of property and equipment (6,411 ) (1,251 ) Proceeds from the repayment of notes receivable from related parties 293 - Acquisition of intangible asset - (250 ) Net cash used in investing activities (6,118 ) (1,501 ) Cash flows from financing activities: Line of credit borrowings 5,869 7,000 Proceeds from term loan 10,000 40,000 Repayment of notes payable - (17,585 ) Proceeds from the exercise of stock options 968 54 Proceeds from the exercise of common stock warrants - 628 Redemption of redeemable common stock placed into treasury - (6,762 ) Principal repayments of capital lease obligations (1,149 ) (557 ) Payment of deferred acquisition consideration (2,568 ) - Payment of debt issuance costs - (849 ) Net cash provided by financing activities 13,120 21,929 Change in cash and restricted cash (19,616 ) (1,246 ) Cash and restricted cash, beginning of period 60,370 21,405 Cash and restricted cash, end of period $ 40,754 $ 20,159 Supplemental disclosure of cash flow information: Cash paid for interest $ 4,626 $ 3,890 Cash paid for income taxes $ - $ 67 Supplemental disclosure of non-cash investing and financing activities: Debt issuance costs included in accounts payable $ - $ 75 Purchases of property and equipment included in accounts payable and accrued expenses $ 4,692 $ 1,638 Amounts due related to acquisition of intangible assets included in accrued expenses and other liabilities $ - $ 500 36 C CON ONFID FIDEN ENTIAL TIAL36 Six Months Ended 2020 Q2 Form 10-Q Cash Flow Statement June 30, 2020 2019 Cash flows from operating activities: Net loss $ (21,479 ) $ (25,315 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 1,793 1,761 Amortization of intangible assets 1,633 2,997 Non-cash interest expense 103 154 Deferred interest expense 1,022 536 Deferred rent expense 64 326 Gain on settlement of deferred acquisition consideration (1,295 ) - Provision recorded for sales returns and doubtful accounts 970 27 Loss on disposal of property and equipment 201 - Adjustment for excess and obsolete inventories 1,709 523 Stock-based compensation 678 458 Loss on extinguishment of debt - 1,862 Changes in operating assets and liabilities: Accounts receivable (5,727 ) 723 Inventory (7,353 ) (6,087 ) Prepaid expenses and other current assets (1,302 ) (785 ) Accounts payable 235 1,473 Accrued expenses and other current liabilities 1,266 122 Other liabilities 864 (449 ) Net cash used in operating activities (26,618 ) (21,674 ) Cash flows from investing activities: Purchases of property and equipment (6,411 ) (1,251 ) Proceeds from the repayment of notes receivable from related parties 293 - Acquisition of intangible asset - (250 ) Net cash used in investing activities (6,118 ) (1,501 ) Cash flows from financing activities: Line of credit borrowings 5,869 7,000 Proceeds from term loan 10,000 40,000 Repayment of notes payable - (17,585 ) Proceeds from the exercise of stock options 968 54 Proceeds from the exercise of common stock warrants - 628 Redemption of redeemable common stock placed into treasury - (6,762 ) Principal repayments of capital lease obligations (1,149 ) (557 ) Payment of deferred acquisition consideration (2,568 ) - Payment of debt issuance costs - (849 ) Net cash provided by financing activities 13,120 21,929 Change in cash and restricted cash (19,616 ) (1,246 ) Cash and restricted cash, beginning of period 60,370 21,405 Cash and restricted cash, end of period $ 40,754 $ 20,159 Supplemental disclosure of cash flow information: Cash paid for interest $ 4,626 $ 3,890 Cash paid for income taxes $ - $ 67 Supplemental disclosure of non-cash investing and financing activities: Debt issuance costs included in accounts payable $ - $ 75 Purchases of property and equipment included in accounts payable and accrued expenses $ 4,692 $ 1,638 Amounts due related to acquisition of intangible assets included in accrued expenses and other liabilities $ - $ 500 36 C CON ONFID FIDEN ENTIAL TIAL
37 Opportunities to Enhance Margins Through Facility Optimization Canton, MA Norwood, MA Birmingham, AL La Jolla, CA ◼ Headquarters◼ Facility in Norwood, MA ◼ Devoted to operations, R&D ◼ Facility supports QC, (nearby Canton HQ), warehouse and distribution of and manufacturing ◼ Devoted to manufacturing, production expected in 2020 amniotic products shipping, operations and R&D which would drive supply chain ◼ R&D labs ◼ Stand-alone R&D facility efficiencies and enhanced ◼ Recent expansion of PuraPly margins ◼ Customer service ◼ Utilizes contract production and logistics ◼ GMP production facility with manufacturing for amniotic multiple cleanrooms to allow products ◼ Opportunity to maximize significant production capacity physical footprint and for multiple products manufacturing efficiency overtime ◼ Flexible laboratory and office space Amniotic products are currently contract manufactured 3737 Opportunities to Enhance Margins Through Facility Optimization Canton, MA Norwood, MA Birmingham, AL La Jolla, CA ◼ Headquarters◼ Facility in Norwood, MA ◼ Devoted to operations, R&D ◼ Facility supports QC, (nearby Canton HQ), warehouse and distribution of and manufacturing ◼ Devoted to manufacturing, production expected in 2020 amniotic products shipping, operations and R&D which would drive supply chain ◼ R&D labs ◼ Stand-alone R&D facility efficiencies and enhanced ◼ Recent expansion of PuraPly margins ◼ Customer service ◼ Utilizes contract production and logistics ◼ GMP production facility with manufacturing for amniotic multiple cleanrooms to allow products ◼ Opportunity to maximize significant production capacity physical footprint and for multiple products manufacturing efficiency overtime ◼ Flexible laboratory and office space Amniotic products are currently contract manufactured 37
38 Interim and Longer-Term Financial Targets Interim Target Longer-Term Goal 2018-2021 2022+ Revenue Growth Low teens CAGR % >10% High 60’s % to Gross Margin High 70’s to 80% Low 70’s % R&D 6 – 8% 7% (% of Net Revenue) SG&A Mid 60’s % to Mid 50’s % (% of Net Revenue) Low 70’s % Adjusted EBITDA Single digit % loss 15-20% Margin 3838 Interim and Longer-Term Financial Targets Interim Target Longer-Term Goal 2018-2021 2022+ Revenue Growth Low teens CAGR % >10% High 60’s % to Gross Margin High 70’s to 80% Low 70’s % R&D 6 – 8% 7% (% of Net Revenue) SG&A Mid 60’s % to Mid 50’s % (% of Net Revenue) Low 70’s % Adjusted EBITDA Single digit % loss 15-20% Margin 38
39 Appendix 3939 Appendix 39
40 Apligraf & Dermagraft – PMA-Approved Products for VLUs and DFUs Advanced Wound Care ◼ Products have ~15 years of clinical history Venous Leg Ulcer Clinical Data Diabetic Foot Ulcer Clinical Data 57% Complete Wound Closure 30% 25% 64% 40% 20% 32% 29% Relative increase in 15% % of patients 24% achieving complete 19% 10% wound closure 9% 5% 5% 0% Weekly up to 4 Weeks 8 Weeks 12 Weeks 24 Weeks 0 4 8 12 8 applications Time in Study Study Week Control (n=100) Apligraf (n=140) Demagraft plus conventional therapy (n=130) Conventional therapy alone (n=115) Diabetic Foot Ulcer Clinical Data Complete Wound Closure 56% 45% 38% PMA approval positions products for private payor coverage and diversifies 25% 20% Company’s revenue mix 3% 4 Weeks 8 Weeks 12 Weeks Time in Study Conventional Therapy Alone (n=96) Apligraf (n=112) 40 (% of patients Closed) (% of patients Closed)40 Apligraf & Dermagraft – PMA-Approved Products for VLUs and DFUs Advanced Wound Care ◼ Products have ~15 years of clinical history Venous Leg Ulcer Clinical Data Diabetic Foot Ulcer Clinical Data 57% Complete Wound Closure 30% 25% 64% 40% 20% 32% 29% Relative increase in 15% % of patients 24% achieving complete 19% 10% wound closure 9% 5% 5% 0% Weekly up to 4 Weeks 8 Weeks 12 Weeks 24 Weeks 0 4 8 12 8 applications Time in Study Study Week Control (n=100) Apligraf (n=140) Demagraft plus conventional therapy (n=130) Conventional therapy alone (n=115) Diabetic Foot Ulcer Clinical Data Complete Wound Closure 56% 45% 38% PMA approval positions products for private payor coverage and diversifies 25% 20% Company’s revenue mix 3% 4 Weeks 8 Weeks 12 Weeks Time in Study Conventional Therapy Alone (n=96) Apligraf (n=112) 40 (% of patients Closed) (% of patients Closed)
41 Robust Clinical Data Supporting Products: Advanced Wound Care Estimated Data Product Wound Type Design Completion Date (4) Presentation Date Acute + Chronic Prospective Single Center Controlled Evaluation (N=40) Q4 2018 Publication Q1 2019 (2) Acute + Chronic Prospective Single Center Controlled Prospective Evaluation Completed Q1 2018 (N=100) Manuscript Q1 2020 publication (2) (5) Acute + Chronic PuraPly AM RESPOND Registry - 30 Center Registry Evaluating Real- Q2 2019 Q4 2019 ACWHTR (6) World Effectiveness of PPAM (N=307) Q2 2020 SAWC (7) Q2 2020 ISPOR (3) All Wounds Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM for Treatment of wounds (N=1,544) (3) Diabetic Foot Ulcers (DFU) Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM vs. Grafix (N=806) (3) DFU Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM vs. Theraskin (N=719) (2) Pressure Ulcers (PU) Prospective Multi-center Randomized Control Trial (RCT) PPAM vs. Q4 2019 Q2 2020 Standard of Care (SOC) (N=38) (1) Venous Leg Ulcer (VLU) Prospective Multi-center RCT PPAM vs. SOC (N=200) Q3 2022 Q1 2023 (8) DFU Prospective Multicenter RCT, Affinity vs. SOC (N=100) Q3 2019 Q4 2019 JCER VLU Prospective Study Evaluating Potential Changes in Wound Q3 2019 Q4 2019 Microenvironment (N=15) (1) VLU or DFU Prospective Multicenter RCT, Affinity vs. SOC (N=200) Q2 2022 Q4 2022 (3) (9) DFU CEA, NetHealth EMR Database of Dermagraft vs. Primatrix (N=208) Q3 2019 Q3 2019 WPM (3) (8) DFU CEA, NetHealth EMR Database of Dermagraft vs. Grafix (N=1,622) Q3 2019 Q4 2019 JCER (2) DFU Prospective Multicenter RCT, NuShield vs. SOC (N=200) Q3 2020 Q1 2021 1. Planned. 5. Estimated date of first external presentation of primary data 2. Based on last patient last visit in the study. 6. ACWHTR: American College of Wound Healing and Tissue Repair; 3. Management estimate or date analysis complete. SAWC: Symposium of Advanced Wound Care 4. Initiation of the study based on first patient enrolled. 1. Planned. 5. ACWHTR: American College of Wound Healing and Tissue Repair; 2. Based on last patient last visit in the study. 6. SAWC: Symposium of Advanced Wound Care. 41 3. Management estimate, or date analysis complete. 7. ISPOR: Int Soc for Pharmacoeconomics and Outcomes 4. Estimated date of first external presentation of primary data. 8. J Compar Effective Res 9. Wound Pain Management 41 Robust Clinical Data Supporting Products: Advanced Wound Care Estimated Data Product Wound Type Design Completion Date (4) Presentation Date Acute + Chronic Prospective Single Center Controlled Evaluation (N=40) Q4 2018 Publication Q1 2019 (2) Acute + Chronic Prospective Single Center Controlled Prospective Evaluation Completed Q1 2018 (N=100) Manuscript Q1 2020 publication (2) (5) Acute + Chronic PuraPly AM RESPOND Registry - 30 Center Registry Evaluating Real- Q2 2019 Q4 2019 ACWHTR (6) World Effectiveness of PPAM (N=307) Q2 2020 SAWC (7) Q2 2020 ISPOR (3) All Wounds Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM for Treatment of wounds (N=1,544) (3) Diabetic Foot Ulcers (DFU) Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM vs. Grafix (N=806) (3) DFU Comparative Effectiveness Analysis (CEA), NetHealth EMR Database Q3 2019 Q2 2020 of PPAM vs. Theraskin (N=719) (2) Pressure Ulcers (PU) Prospective Multi-center Randomized Control Trial (RCT) PPAM vs. Q4 2019 Q2 2020 Standard of Care (SOC) (N=38) (1) Venous Leg Ulcer (VLU) Prospective Multi-center RCT PPAM vs. SOC (N=200) Q3 2022 Q1 2023 (8) DFU Prospective Multicenter RCT, Affinity vs. SOC (N=100) Q3 2019 Q4 2019 JCER VLU Prospective Study Evaluating Potential Changes in Wound Q3 2019 Q4 2019 Microenvironment (N=15) (1) VLU or DFU Prospective Multicenter RCT, Affinity vs. SOC (N=200) Q2 2022 Q4 2022 (3) (9) DFU CEA, NetHealth EMR Database of Dermagraft vs. Primatrix (N=208) Q3 2019 Q3 2019 WPM (3) (8) DFU CEA, NetHealth EMR Database of Dermagraft vs. Grafix (N=1,622) Q3 2019 Q4 2019 JCER (2) DFU Prospective Multicenter RCT, NuShield vs. SOC (N=200) Q3 2020 Q1 2021 1. Planned. 5. Estimated date of first external presentation of primary data 2. Based on last patient last visit in the study. 6. ACWHTR: American College of Wound Healing and Tissue Repair; 3. Management estimate or date analysis complete. SAWC: Symposium of Advanced Wound Care 4. Initiation of the study based on first patient enrolled. 1. Planned. 5. ACWHTR: American College of Wound Healing and Tissue Repair; 2. Based on last patient last visit in the study. 6. SAWC: Symposium of Advanced Wound Care. 41 3. Management estimate, or date analysis complete. 7. ISPOR: Int Soc for Pharmacoeconomics and Outcomes 4. Estimated date of first external presentation of primary data. 8. J Compar Effective Res 9. Wound Pain Management
42 Robust Clinical Data Supporting Products: Surgical & Sports Medicine Estimated Data (1) Product Indication Design Completion Date (2) Presentation Date Lumbar Spine 57 patient Prospective, Efficacy Study of NuCel Q2 2020 Q3 2021 Vertebral Fusion in patients Undergoing Fusion for One, Two or Three Level Degenerative Disease of the Lumbar Spine Lumbar Spine 200 patient Single-Arm Prospective, Multi- Q4 2022 Q3 2023 Vertebral Fusion center study of NuCel in patients receiving interbody fusion for one and two level degenerative disease of the lumbar spine Hip Osteoarthritis 10 patient Pilot Study of ReNu Hip Injection: Completed Q1 2020 Monitoring the Response of Hip Function and Pain in patients with Osteoarthritis Osteochondral Defect 8 patient Evaluation of the ReNu Amniotic Q2 2022 Q4 2022 Repair Suspension Allograft after Marrow Stimulation in the Treatment of Osteochondral Defects Plantar Fasciitis 150 patient Comparative study of injectable Q2 2021 Q2 2022 human amniotic allograft (ReNu) versus corticosteroids for Plantar Fasciitis: A Prospective, Randomized, Blinded Study (3) Knee Osteoarthritis 200 patient Investigation of ReNu Knee Q3 2018 Presented at AAOS 2019 Injection: Response of Knee Function and Pain Q4 2019 J Knee Surgery in patients with Osteoarthritis Investment enhances sales efforts and reimbursement dynamics Notes: 1. Based on last patient last visit in the study. 42 2. Estimated date of first external presentation of primary data 3. AAOS: American Academy of Orthopaedic Surgeons42 Robust Clinical Data Supporting Products: Surgical & Sports Medicine Estimated Data (1) Product Indication Design Completion Date (2) Presentation Date Lumbar Spine 57 patient Prospective, Efficacy Study of NuCel Q2 2020 Q3 2021 Vertebral Fusion in patients Undergoing Fusion for One, Two or Three Level Degenerative Disease of the Lumbar Spine Lumbar Spine 200 patient Single-Arm Prospective, Multi- Q4 2022 Q3 2023 Vertebral Fusion center study of NuCel in patients receiving interbody fusion for one and two level degenerative disease of the lumbar spine Hip Osteoarthritis 10 patient Pilot Study of ReNu Hip Injection: Completed Q1 2020 Monitoring the Response of Hip Function and Pain in patients with Osteoarthritis Osteochondral Defect 8 patient Evaluation of the ReNu Amniotic Q2 2022 Q4 2022 Repair Suspension Allograft after Marrow Stimulation in the Treatment of Osteochondral Defects Plantar Fasciitis 150 patient Comparative study of injectable Q2 2021 Q2 2022 human amniotic allograft (ReNu) versus corticosteroids for Plantar Fasciitis: A Prospective, Randomized, Blinded Study (3) Knee Osteoarthritis 200 patient Investigation of ReNu Knee Q3 2018 Presented at AAOS 2019 Injection: Response of Knee Function and Pain Q4 2019 J Knee Surgery in patients with Osteoarthritis Investment enhances sales efforts and reimbursement dynamics Notes: 1. Based on last patient last visit in the study. 42 2. Estimated date of first external presentation of primary data 3. AAOS: American Academy of Orthopaedic Surgeons
43 Non-GAAP Reconciliations – Adjusted EBITDA 4343 Non-GAAP Reconciliations – Adjusted EBITDA 43
44 Non-GAAP Reconciliations – Adjusted EBITDA Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 (in thousands) (in thousands) Net loss $ (5,166 ) $ (9,649 ) $ (21,479 ) $ (25,315 ) Interest expense, net 2,912 2,187 5,422 3,965 Income tax expense 27 23 62 60 Depreciation 891 859 1,793 1,761 Amortization 816 1,499 1,633 2,997 EBITDA (520 ) (5,081 ) (12,569 ) (16,532 ) Stock-based compensation expense 469 234 678 458 Gain on settlement of deferred acquisition consideration (1) - - (1,295 ) - Loss on extinguishment of debt (2) - - - 1,862 Other costs and expenses (3) 325 - 568 - Adjusted EBITDA $ 274 $ (4,847 ) $ (12,618 ) $ (14,212 ) (1) The amount reflects the gain recognized related to the settlement of the deferred acquisition consideration dispute with the sellers of NuTech Medical. (2) The amount reflects the loss recognized on the extinguishment of the Master Lease Agreement upon repayment. (3) The amounts reflect other costs and expenses incurred not related to operations in the three and six months ended June 30, 2020. 4444 Non-GAAP Reconciliations – Adjusted EBITDA Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 (in thousands) (in thousands) Net loss $ (5,166 ) $ (9,649 ) $ (21,479 ) $ (25,315 ) Interest expense, net 2,912 2,187 5,422 3,965 Income tax expense 27 23 62 60 Depreciation 891 859 1,793 1,761 Amortization 816 1,499 1,633 2,997 EBITDA (520 ) (5,081 ) (12,569 ) (16,532 ) Stock-based compensation expense 469 234 678 458 Gain on settlement of deferred acquisition consideration (1) - - (1,295 ) - Loss on extinguishment of debt (2) - - - 1,862 Other costs and expenses (3) 325 - 568 - Adjusted EBITDA $ 274 $ (4,847 ) $ (12,618 ) $ (14,212 ) (1) The amount reflects the gain recognized related to the settlement of the deferred acquisition consideration dispute with the sellers of NuTech Medical. (2) The amount reflects the loss recognized on the extinguishment of the Master Lease Agreement upon repayment. (3) The amounts reflect other costs and expenses incurred not related to operations in the three and six months ended June 30, 2020. 44