Vericel (VCEL) TD Cowen 46th Annual Health Care Conference summary

Portfolio overview and market position

• Offers advanced cell therapies and biologics for sports medicine and severe burn care, with a strong competitive moat and no direct competitors for key products.

• MACI leads the cartilage repair market, showing a 24% CAGR since 2017 and consistent 20%+ annual growth.

• Burn care products Epicel and NexoBrid are the only approved products in their classes, addressing both debridement and wound closure.

• NexoBrid benefits from orphan drug exclusivity, and the portfolio is positioned for sustained growth.

Financial performance and profitability

• Achieved 79% gross margin and 40% EBITDA in Q4, with full-year gross margin at 74% and EBITDA at 26%.

• Guidance anticipates gross margin rising to 75% in the coming year, factoring in new facility costs.

• Self-funded a $100 million new manufacturing facility while increasing cash balance, expecting cash generation to inflect as CapEx declines.

• GAAP profitable for the past two years, with continued margin improvement expected.

Manufacturing expansion and operational transition

• FDA approved a new state-of-the-art manufacturing facility in Burlington, enabling global expansion and risk mitigation.

• Transition plan involves phased transfer of manufacturing from Cambridge, with full transition expected by year-end.

• Multiple clean rooms and modern infrastructure reduce operational risks and support 365-day manufacturing.