TELA Bio Inc. (TELA) Q4 2020 Earnings Call Transcript

TELA Bio Inc. (TELA -1.35%)
Q4 2020 Earnings Call
Mar 24, 2021, 4:30 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the TELA Bio fourth quarter earnings conference call. [Operator instructions] Please be advised that today's conference is being recorded. [Operator instructions] I would now like to hand the conference to your speaker today, Greg Chodaczek from Gilmartin Group. Please go ahead, sir.

Greg Chodaczek -- Vice President, Corporate Development and Investor Relations

Thank you, Victor, and good afternoon, everyone. Earlier today, TELA Bio released financial results for the fourth quarter and year ended December 31, 2020. A copy of the press release is available on the company's website. Joining me on today's call are Tony Koblish, president and CEO; and Nora Brennan, CFO.

Tony will begin the call by providing an overview of our operational highlights, and then Nora will provide a detailed analysis of our fourth quarter and full-year financial performance. Before we begin, I'd like to remind you that during this conference call, the company will make projections and forward-looking statements regarding future events. We encourage you to review the company's past and future filings with the SEC, including, without limitation, the company's forms 10-K and 10-Q, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward-looking statements. These factors may include, without limitation, statements regarding product development, product potential and the regulatory environment, sales and marketing strategies, capital resources or operating performance.

With that, I will now turn the call over to Tony.

Tony Koblish -- President and Chief Executive Officer

Thanks, Greg, and good afternoon, everyone. We appreciate you taking the time to join us today. Before reviewing our operational highlights, I would like to recognize our team's hard work and dedication at TELA Bio. Despite the challenges and uncertainties of COVID-19, our company has made meaningful progress in all areas of our business over the past 12 months.

In 2021, we plan to build on this momentum and continue to be a leader and innovator in developing tissue reinforcement materials for soft tissue reconstruction. Now turning to our results. Total revenue for the fourth quarter was $5.7 million, representing growth of approximately 17% compared to the fourth quarter of 2019. Like many med tech companies with product used in surgical procedures, we experienced both highs and lows in the fourth quarter.

Throughout October and into November, sales for our OviTex products were picking up, and we were cautiously optimistic about recording strong year-over-year growth. However, as the holidays approached in the second half of the quarter, we experienced increased volatility in demand for our products as COVID cases and hospitalizations increased. This trend continued into January with some areas of the country being worse than others. Starting in early February and continuing through today, surgical procedure trends had improved.

While we are hopeful these trends will continue throughout the year, forecasting COVID-19 cases and hospitalizations is a challenge and is best left to the experts. Before turning the call over to Nora, I would like to talk about some of our accomplishments from 2020. Starting with our BRAVO study. As a reminder, the BRAVO study is a multicenter prospective study designed to evaluate the clinical performance of OviTex for the treatment of ventral hernias, and 85% of the patients met the criteria for Ventral Hernia Working Group grade 2 or grade 3.

Last week, we submitted our latest data set for publication, and the data continues to be very good. 76 of the 84 participants or 90% has completed their 12-month follow-up with only two having hernia recurrences, both of which occurred adjacent to the repair. In addition, 51 patients completed their 24-month follow-up and none experienced a new hernia recurrence. Of these 51 patients, only one experienced a surgical site occurrence between 12 and 24 months, and this SSO did not require surgical intervention or implant removal.

As we have noted in previous calls, the 24-month post-procedure data are considered to be the gold standard and is vital in persuading surgeons to adopt OviTex. Based on the current BRAVO clinical trial data, the hernia recurrence rates for OviTex at 12 months is 2.6% and 0% for the 51 patients that are out at 24 months. These rates compare very favorably to results published for synthetics, resorbable synthetics or biologics. Based on our latest estimates, which account for delays we are experiencing scheduling follow-up and site visits for data verification, we expect to have validated data on our 24-month patients by the end of the year.

In 2020, another area of success for us has been robotic hernia repair. Today, most robotic hernia repairs use plastic mesh due to its strength and the ability to roll it tightly to fit down a trocar. However, due to the unique properties of OviTex, we are gaining market share with minimally invasive and robotic hernia procedures. For the fourth quarter, we estimate that approximately 50% of our usage came from MIS and robotic procedures, and we saw a 32% sequential increase in our LPR unit sales.

This data point coincides nicely with our recently completed survey. Based on the data we compiled, synthetic mesh products have been the subject of an increasing number of lawsuits with over 13,000 cases filed in the state of Rhode Island alone. As this number continues to grow and make headlines, surgeons tell us that approximately 20% of their patients are concerned about the use of plastic mesh and would prefer something more natural could be used. Also, nearly 60% of the surgeons we surveyed believe that synthetic mesh probably causes long-term risk of complications.

We believe the migration from plastic mesh will continue, and we are hopeful that sales of OviTex will benefit as a result. Regarding the plastic and reconstructive market, we are very pleased with the continued expansion of the PRS launch as we experienced record unit volume and dollar growth in the quarter. This is very encouraging, giving the variability and access to supply chain administration for new products and technology. It is emerging that there is a real opportunity for a portfolio of PRS products that are tuned to different patient needs and surgeon technique preferences.

This is a vastly different paradigm than what exists today with one material cadaver scan for all situations. As we mentioned last year, in response to the pandemic, we developed TELA LIVE, our virtual marketing sales solution designed to educate surgeons about our product portfolio and clinical data. Since the start of these programs, approximately 200 surgeons have participated and roughly third have been plastic surgeons. Engagement with plastic surgeons remains high, and many have told us they are seeking advancements in plastic reconstruction, especially as it relates to acellular dermal matrices, or ADMs.

This data point is consistent with the uptick in the number of IDN and GPO requests we are receiving for cross referencing our PRS portfolio. We continue to grow our commercial team. And at the end of 2020, we had 45 territories filled by 40 sales reps. Our goal is to have 48 reps in place by the middle of 2021, and we expect to continue to increase our number of reps through the remainder of the year.

These sales reps will be filling our HealthTrust accounts, making sure that we have coverage in all of our major IDNs and GPOs. In the fourth quarter, we increased the number of hospital customers from 270 to 325 with the number of HealthTrust accounts also increasing. And finally, we believe physical access to hospitals is beginning to ease as our sales reps are seeing more requests to cover surgeries. We expect this trend to continue as more vaccines are rolled out.

I would now like to turn the call over now to Nora to review our fourth quarter and full-year financial summary.

Nora Brennan -- Chief Financial Officer

Thanks, Tony, and hello, everyone. Please refer to our press release issued earlier today for a summary of our financial results for the fourth quarter and full-year 2020. After commenting on our financial results, I will also provide our financial guidance for 2021. Revenue for the fourth quarter of 2020 increased 17% year over year to $5.7 million.

For the full-year 2020, revenue increased 18% to $18.2 million compared to 2019. The increase in both periods was due primarily to the expansion of our commercial organization and increased penetration within existing customer accounts. Gross profit as a percentage of revenue improved in both the fourth quarter and full-year periods compared to the respective prior year periods due to longer shelf life on our products and inventory management for our OviTex products. Fourth-quarter gross margins increased to 65% from 61% in the prior year period, while full-year 2020 gross margins increased to 62% from 60%.

Sales and marketing expenses were $6.4 million in the fourth quarter of 2020 compared to $5.4 million in the same period in 2019. For the full-year 2020, sales and marketing expenses were $22.1 million compared to $18.1 million for the full-year 2019. The increase in both periods was due to the expansion of the commercial organization and related activities, partially offset by lower travel and consulting expenses. G&A expenses were $2.9 million in the fourth quarter of 2020 compared to $2.5 million in the same period in 2019.

For the full-year 2020, G&A expenses were $10.1 million compared to $6.2 million in 2019. The increase in both periods was due primarily to an increase in insurance premiums, personnel costs and professional fees. R&D expenses were $1.2 million in the fourth quarter of 2020 and $4.3 million for the full-year 2020. Fourth-quarter 2020 R&D costs were slightly higher than the same period in 2019 based on personnel costs and additional testing fees.

However, full-year 2020 R&D costs remain relatively flat compared to 2019. Loss from operations was $6.7 million in the fourth quarter of 2020 compared to $5.8 million in the prior year period. For the full-year 2020, loss from operations was $25.3 million compared to $19.2 million for 2019. Net loss was $7.8 million in the fourth quarter of 2020 compared to $6.5 million in the same period in 2019.

For the full-year 2020, net loss was $28.8 million compared to $22.4 million for 2019. We ended 2020 with $74.4 million in cash and cash equivalents compared to cash, cash equivalents and short-term investments of $54.6 million at year-end 2019. This increase includes net proceeds of approximately $44.7 million from the company's public offering completed in June 2020. Now turning to the outlook for 2021.

We expect total revenues to be in the range of $27 million to $30 million, representing growth of 48% to 65% over 2020. We are providing guidance today, but recognize that the course of the pandemic remains uncertain, and as a result, the rate of recovery in surgical procedures remains variable. In our full-year guidance, we assume a gradual improvement in procedures in the first half, with no further setbacks from new surges or new COVID variants. We will continue to assess the current environment and provide updates on our quarterly calls as continued uncertainty relating to the dynamic environment with the COVID-19 pandemic could materially impact this projection.

I'll now turn the call back over to Tony.

Tony Koblish -- President and Chief Executive Officer

Thank you, Nora. I'm happy to announce we will be hosting a virtual KOL day on April 12 from 3:00 p.m. to 4:30 p.m. Eastern time.

This 90-minute webinar will feature presentations from key opinion leaders, discussing the benefits of natural repair and soft tissue reconstruction and how OviTex has shown superior outcomes for patients. These presentations will be followed by a question-and-answer session. A formal invitation will be sent out later this week. We hope you can join us.

With that, Victor, please open the call up for questions.

Questions & Answers:

Operator

[Operator instructions] Our first question will come from the line of Matthew O'Brien from Piper Sandler. Your line is open.

Matthew O'Brien -- Piper Sandler -- Analyst

Aafternoon. Thanks for taking my questions. And I just wanted to pass along my heartfelt condolences on the news that Maarten had passed away. I'm so sorry to hear that.

Tony Koblish -- President and Chief Executive Officer

Yes. Thank you, Matt. We appreciate it.

Nora Brennan -- Chief Financial Officer

Thanks, Matt.

Matthew O'Brien -- Piper Sandler -- Analyst

So turning to guidance. Nora, I appreciate you providing some of that guidance today. It's about 20% lower than we had kind of been thinking heading into the year, understanding there's some COVID impacts. So can you just kind of deconstruct where we're expecting some softness here in the hernia side, on the plastic side and where things could potentially even provide a little bit of upside as we start to exit this year.

Nora Brennan -- Chief Financial Officer

Sure. So thanks for the question, Matt. So I think as Tony mentioned in -- when he was speaking before, is that we saw some softness coming out of December into January, and it held up a little bit through February. So we're starting to see a rebound certainly in the back half of February and into March.

So just to be a little bit more cautious around the guidance, that's why we're guiding a little bit lower than where you had us. I think for us, it's really making sure that we get the count up. I mean, as Tony mentioned, we ended the year with about 40 reps, but 45 territories. It's really making sure that we've got reps in the locations and who have access to hospitals and IDNs.

So I think with that, that's part of the conservative nature of the guidance that we're providing today. The other thing is we're -- when we think about PRS, I mean, we're still doing the launch. I mean we've had some great growth in Q4 around our PRS and we expect that to continue. But it's still a new product.

We're still working with plastic surgeons to use it. Working with the -- our clinical development team. So I think for us, it's just trying to be really conservative, not really sure when and how quickly we're going to be able to get into the hospitals certainly around with the rollout of vaccines.

Tony Koblish -- President and Chief Executive Officer

Yes. I'll add a little bit, Matt, as well that's color to what Nora just said. For us, we're thinking about the transition zones between quarters, right? So we go back to 2020 and we look at that transition zone between Q2 and Q3. The transition zone there was tough, tough quarter in Q2, a little bit of backlog in Q3.

And then I'd say Q3 was really stabilization, probably at a bit of a depressed level due to COVID, but certainly stabilization. That lasted until around Thanksgiving, and then it got pretty volatile up and down. And that volatility seemed to have a more national impact, I'd say, for the month of January. But then by February, we snapped back pretty good, right back on plan.

And then March is looking really strong. I think we have a very good shot at exceeding plan. So I like where we are very much. Q4 sort of ended choppily, whereas we're jumping off from Q1 into that transition into Q2 super, super strong, right? We invested, we hired, we trained.

We got great data. We just have everything firing on all cylinders. So that transition zone, if it happens and we stabilize and get stronger in Q2, I think that represents some upside. As we said in our notes and as Nora indicated, we really forecasted around more of a Q2 to Q3 transition, really with more chop in Q2.

So I think there's some upside there. And then certainly, we think there's just a lot of upside around our PRS business and how that's starting to move forward. But again, it's new. We're not the incumbent, and we've got to overcome being the new guy on the block and getting the hospital administration moving.

The other thing that we're really cautiously optimistic about is the number of accounts that we put on, right? So the supply chain -- there's two real problems that COVID causes, right? Problem one, is surgeon and rep access, getting together, servicing, doing the cases. But problem 2 is really dealing with supply chain admin. And they come and go. They came back and I think we had a backlog of new accounts come online in Q4 that really haven't started producing yet.

And so those will start producing as COVID clears out. So yes, I think there's upside baked into what we're doing here. We just have to be realistic, and we had to pick our spot of when we think things are going to clean out, and we chose a quarter later, more like a second half clean up, Matt.

Matthew O'Brien -- Piper Sandler -- Analyst

OK. OK. Makes total sense. So just sounds like you're being conservative and hoping that things kind of free up as we get into the back half guidance.

Tony Koblish -- President and Chief Executive Officer

Yes. I mean I can tell you, our commercial team is bullish coming out of Q1. We just need to have things straightened out, at least the way they were in Q3. If things straighten out like they were in Q3, we have a lot of pent-up stuff that's getting ready to break loose.

And we're feeling good about it. So that's the key.

Matthew O'Brien -- Piper Sandler -- Analyst

OK. Helpful. And then just two more questions. I'll ask them both together to be mindful of everybody's time.

But just, Tony, I think you're up to 200 surgeons on TELA LIVE. How many -- I think there's 140 coming out of last quarter. How many have converted over to using or starting or getting close to being able to use your product? Is it 50%, 80%, 90%? And then Nora, what does cash burn look like this year if you're doing somewhere in that $27 million to $30 million of revenue? Thank you.

Tony Koblish -- President and Chief Executive Officer

Yes. TELA LIVE has just been excellent for us. It's been a lifeblood. Our mix is starting to get a little more heavy on the plastic surgeon side.

I think about a third of those surgeons have been on the plastic surgery side of the house, which is really, really good. We estimate that there's been about, I'd say, 115% increase on average for the surgeons that go through the TELA LIVE program. Now keep in mind that we're targeting two types of surgeons, right? We have those that are fresh, brand new, have never used the product. There's less of those, but we really have -- the bigger group are the surgeons that have done a little bit, they're intrigued, they like what they see, and this is a way to drive increased usage, but also perhaps to get their partners and get other surgeons engaged.

So we're looking at that uptick as the key measure. And by any measure, that 115% uptick in the next few months after TELA LIVE execution is a very good signal. And I do think that the TELA LIVE metric is also tied very closely to those 47 new accounts that we put on in Q4. And frankly, all of the new accounts, right, because it's the main mechanism that we have for getting surgeon buy-in.

So I think it could be half of the TELA LIVE programs have not yet started contributing yet to this revenue base because of whatever is going on, on the ground. So there's a tremendous pent-up demand. If you -- and maybe another way of looking at this is if you look at our territories, we're estimating that about 40% of our accounts right now are operating below pre-COVID levels, right? So that means that we have pretty close to 60% of our accounts that are operating above pre-COVID levels. And that is all TELA LIVE and all the stuff that we're doing to adapt to the environment.

Matthew O'Brien -- Piper Sandler -- Analyst

Got it. And Nora, just on the cash burn?

Nora Brennan -- Chief Financial Officer

Yes. So I mean we've burned about $7 million in Q4. And I think on a run rate basis, Matt, we'll do -- we'll burn through maybe $28 million to $30 million based on our revenue guidance. So we've done a lot of good things, certainly, with expenses in 2020, and some of that stuff is going to stick with us.

Matthew O'Brien -- Piper Sandler -- Analyst

Got it. Thank you.

Operator

Our next question comes from the line of Anthony Petrone from Jefferies. Your line is open.

Anthony Petrone -- Jefferies -- Analyst

Thank you very much. And I'll second, again, condolences on the passing of Maarten, and best wishes to his family and everyone and the team at TELA. So again, our condolences for myself and from the broader team at Jefferies as well.

Tony Koblish -- President and Chief Executive Officer

Appreciate it.

Anthony Petrone -- Jefferies -- Analyst

Yes, absolutely. Tony, maybe just a follow-up on the 60-40 statistics you just gave, maybe a little bit more color there. 40% are still pre-pandemic levels, 60% are at or above pre-pandemic levels. Is there a way to just sort of splice that out a bit in the sense that are the 40% that are behind were those higher volume accounts? Or is it just the mix of...

Tony Koblish -- President and Chief Executive Officer

Yes. Yes. So there's a couple of things going on there, right? So one factor is just the construction stage of where our sales force was when COVID hit, right? So we had just built out to six sales regions when COVID hit. So we had essentially one nonfunctional region in our grouping because it was just getting built.

When COVID hit, we had literally just hired the regional manager, and he didn't really have any reps and we locked down hiring. So he was at a deficit. He's now building his territory up, and we expect great things from that territory in the next coming quarters. Then one of our strong territories pre-COVID was the Northeast.

We were really strong in New York, and that really took a beating in the early stages of COVID. Everybody clearly remembers that. And that territory has not come back to full speed. So in that grouping, there's a lot of the accounts that rest in those two regions.

So right now, we really have four of six regions that are fully built out, fully staffed and are executing well, but we're not far away from having all six regions come back. Now that said, everything is not perfect in those four regions, right? So when things got choppy and gritty at the end of last year and in January, we saw localized territory shifting in terms of COVID impact. We saw Florida, Texas, California, but then we saw a rotation back where the Midwest started to take some hits in January. And a lot of those states are where we had some of our best territories and highest producing account managers.

So it's almost a little bit of whack-a-mole that has been going around the country as these COVID swings unroll. But really for us, the core of it is that architecture of the two regions that got the most impacted by COVID. So we have not yet seen the benefit of all six regions firing. And I think we're going to start to see it Q2, Q3.

It's coming. The optimism and bullishness within our commercial team is really, really excellent and good to see right now.

Anthony Petrone -- Jefferies -- Analyst

That's very helpful as a backdrop in the two follow-ups for me real quick, and I'll hop back in. One would be an update on hernia mesh lawsuits. And I know last year, Bard and Ethicon were supposed to have, I guess, the commencement of MDL suits on synthetic mesh. And I believe that's been pushed out.

So any update there would be helpful. And as you look now at Phasix and Strattice being sort of embedded, you have more BRAVO data out there. We presumably are going to get some ruling on litigation that I believe would be negative headline for the competitors. And so how do you think the conversation this year is going to feel with your sales force and talking to physicians about making -- finally making that switch to biologic from synthetic?

Tony Koblish -- President and Chief Executive Officer

Yes, it already feels better, right? So you are correct. The litigation, the lawsuits were probably slated to kick off around summer of last year. Right now, our latest information is that the main bolus of suits in Rhode Island may be starting in the next month or so. So we're getting closer.

And I think that, that is already having an impact in terms of swinging the conversation more to natural repair, right? We did a little survey work that we've talked about in the past where even before the litigation becomes very public, 20% of patients are acutely aware and would love to have something different than plastic mesh. And a good percentage, 60% of the surgeons are now starting to think deeply about, well, are there potential long-term complications and I have to think about and listen to what my patients are asking those questions. And so I think the environment has never been better. You mentioned two competitors there.

I think one competitor, the Strattice product, is a very expensive product. It's not really designed, tuned to be used robotically. The price is not right, the handling is not right for a lot of these simple procedures such as inguinal, hiatal and simple ventrals and robotics. Phasix, on the other hand, is.

It is tuned for a wide array of procedures. And it's priced just a little bit more than our products. So we're in the ballpark with them. So I think a likely and a hopeful outcome would be that OviTex and Phasix can sort of become the duo that replaces Phasix and Strattice, what they were, right, as this shift slowly starts to come online.

And we would take that all day. That would be spectacular for us. So I think the dialogue is happening. The market research data seems to be showing the right trends, and we're very well positioned.

And what's interesting is if you look at the IQVIA data and you look at sort of Bard as their own control, we definitely see a growth and shift toward Phasix at the expense of their wide, wide array of polypropylene permanent mesh products. So I think that, to me, is pretty good evidence that there's a lot of interest in natural repair products.

Anthony Petrone -- Jefferies -- Analyst

Very helpful. Thank you so much.

Operator

Our next question will come from the line of Kyle Rose from Canaccord.

Kyle Rose -- Canaccord Genuity -- Analyst

Great. Thank you for taking the questions. And I echo the condolences on our end as well. I wanted to just get a little more insight around maybe some of the underlying productivity that you're seeing.

I appreciate the account gains. I mean, obviously, impressive given the backdrop of the pandemic. But maybe help us understand how much of those account gains are utilizing both products or both families of products versus maybe just OviTex or just PRS alone. And then maybe just help frame out a little bit more, you talked about adding the more than 40 accounts in the Q4.

Those really haven't contributed yet. How should we think about what that utilization looks like so the run rate you're entering '21, assuming COVID is behind us?

Tony Koblish -- President and Chief Executive Officer

Yes. So I'm going to add again another variable to stack up on the proof source that we have -- that we're exceptionally well positioned. We did all the right things in 2020, right? We brought on 21 new reps, right, in the pandemic. And those reps have already contributed about 20% to the revenue.

So we've proven that we can attract the right talent that has the right relationships so they can function in the pandemic, first of all. And then we've invested mightily in the training and education. It's just constant, right? We're going to use this downtime to make them better and better. And then the virtual -- the last piece of the pipe to the sale is definitely that surge in that hospital process and our TELA LIVE stuff has worked exceptionally well.

So I think that's yet another variable that's on top of but definitely contributes, I think, to that 60% figure of accounts being better than pre-COVID, right? And it all comes down to all of that stuff that was going on in the middle of that. So I don't know if that answers the question or if you need a little bit more there, Kyle.

Nora Brennan -- Chief Financial Officer

Kyle, I could -- Tony, I can just jump in a little bit, too, as well as -- Kyle, I think what we saw in Q4, about 25% of the new accounts were just PRS and then the remainder was hernia. But overall, we had the overlap of about 15% were setting up for both PRS and hernia. So as we get into 2021, the expectation is we'll see more accounts coming on board with both OviTex, signing up for both OviTex and PRS products. And we're certainly seeing that within our HealthTrust accounts.

Tony Koblish -- President and Chief Executive Officer

Yes. Thank you for covering that, Nora. Thank you.

Kyle Rose -- Canaccord Genuity -- Analyst

OK. That's great. That's very helpful. And then when we think about the core hernia business, maybe -- obviously, the trends within LPR robotics are very encouraging.

But maybe just help us understand like what type of hernia cases are you seeing be prioritized versus maybe some that are building up from a backlog perspective? Just trying to understand the mix of the type of cases we're going to see in 2021, and then kind of how that's impacting pricing, because I know some of the smaller meshes on the LPR side do come at a different ASP. So how are you thinking about mix in the hernia business?

Tony Koblish -- President and Chief Executive Officer

Yes. That's very true. Our units are up more than our dollars right now in hernia, which I think is ultimately a good thing in the sense that it demonstrates the utility of the product across all hernia types of procedures, right, and particularly MIS and robotic. So there may be a higher baseline volume that's driven by the LPR.

The LPR is contributing more and more to the portfolio. But at the end of the day, the mix has been fairly consistent. As I'm looking at the data here across the quarters, roughly 50% open, roughly 50% robotic and lap seems to be fairly consistent. And our ventral business is still the bread and butter business, right? That business is the mainstay compared to inguinals and hiatals and even the simple ventrals, which are more robotic in nature.

But I think about 50% is in that MIS category, which is probably simple ventrals on down. So I think we're going to continue to see that. And then I think the large sizes, I think we expect the large sizes, which really is a proxy for the complex ventrals and ab wall, those are going to tick up as the year goes forward because those are emergent. And as those get delayed, we see backlogs of those coming out and I expect that there will be a bolus of those coming out wherever the transition point is, right, that I spoke of earlier, whether it's Q1 to Q2 or Q2 to Q3.

There's going to be these emerging complex cases that just pick up steam. So I think we're going to see those start to come at us as well.

Kyle Rose -- Canaccord Genuity -- Analyst

Great. And then I've just got two last questions that I'll sneak in together. The first one is just the overall competitive response you've seen in the market. I mean, obviously, you now have 12-month data with more than 50 patients that came out last week.

So what kind of counter selling are you seeing from other players? And then maybe just overall, talk about the penetration into HealthTrust from an account base. You talked about higher accounts, but maybe just help us understand where are you at with HealthTrust penetration.

Tony Koblish -- President and Chief Executive Officer

Sure. So yes. So competition, right? So the competitive response evolves, right, as we gain success. When we first came out, the competitive response was fairly simple.

They're not on contract, kick them out and they have no clinical data. Sure, their primary data is interesting, but clinical data, right? So we've largely solved those two counter details, counterpunches, right? We've got excellent clinical data emerging. Of course, we need more, and we are collecting more in terms of retrospective series, etc. And we need to finish off BRAVO 1 to have the full complement of data at two years.

But you can see that the BRAVO data looks just spectacular relative to competitive products. And Bravo 2, which will be robot-specific studies, needs to get going as well. That's been delayed due to COVID. But we have some interesting ideas on how to jump-start robotic data sets there.

So we've shifted now to a point where clinical data and contracting are in place. So interestingly enough, we're just seeing usual med tech, hand-to-hand combat kind of tactics, right? I mean there's been a rash lately of what I'll call little ticky tack studies, like put a piece of plastic in a pouch and infect it with bacteria and compare it to OviTex. And if the bacteria eats the biologic material, it must be bad, right? But that means nothing clinically, right? It's sort of like a rigged test. And we've seen little ticky tack trials like that using enzymes and things like that.

So it's good, it's healthy. We have the answers to every one of those little preclinical studies that they're throwing at us. Because we feel super confident in the product set, the clinical data is awesome. It's very consistent, not just with BRAVO, but with the rest of our clinical data.

We have about 500 patients aggregated in various studies from everything from robotics to inguinal to complex ventrals, and we even have some surgeons that have done 100% conversions. One of the guys that's going to be speaking at the KOL event, I think he might have 500 procedures under his belt just on his own. So there's just a drum beat, methodical, steady, disciplined. And that's just the way we're going to do it, right? So sure, the flack will come at us.

Right now, I wouldn't consider the flack to be anything out of the normal that I've experienced in my career, hand-to-hand combat in the field and the OR with surgeons.

Nora Brennan -- Chief Financial Officer

And I think the other question was around the HealthTrust accounts.

Tony Koblish -- President and Chief Executive Officer

Yes. So HealthTrust -- yes, go ahead, Nora.

Nora Brennan -- Chief Financial Officer

I mean I'll just say -- I can -- I was just going to say, Kyle, so in Q4, about a third of our accounts were HealthTrust accounts generating about a third of our revenue. So we saw about 12% increase in our Q4 numbers for our HealthTrust accounts. So we're going to continue to penetrate. And the areas where there's real opportunity is just kind of getting some of -- more of those HealthTrust accounts signed up.

And I think that's a real opportunity for us certainly coming into 2021.

Tony Koblish -- President and Chief Executive Officer

Absolutely. Yes. I'll throw a couple of numbers at you, too, Kyle. We had about 60-some-odd HealthTrust accounts at the start of 2020, and I think we ended the year in the 90s.

And that's with a big chunk of the year being shut down to new products. So HealthTrust, like I said, methodical, slow, steady. As they open up, we're there, we're ready. We have the reps.

We made the investments. So we feel like we're in good shape there.

Kyle Rose -- Canaccord Genuity -- Analyst

Great. Thank you for taking the questions. Thanks, guys.

Operator

Our last question will be from the line of Dave Turkaly from JMP Securities.

David Turkaly -- JMP Securities -- Analyst

Reiterate the condolence, what a great guy. Tony, I know you talked about hernia volumes, and thank you for the color on the monthly progression of 4Q and 1Q. But being down something like 40% -- or 30%, something to that magnitude, maybe at the end of last year. And obviously, we can look at some of the comments you made about how the first quarter progressed.

But where does that stand today? And sort of what is underlying your guidance in terms of how those procedures grow? Is it back to sort of a normal cadence? I would imagine it might even get a little bit of an uptick from some of the reschedulings.

Tony Koblish -- President and Chief Executive Officer

Yes. I think that's right. Like I said on my other comments, if we could just get the volatility stabilized similar to the way it was in Q4, if we could get -- or I'm sorry, Q3 of last year, if we could get that back in place starting in Q2, that's where I think it gives us that clean air to get all six regions cranking, get those 47 new accounts moving, all of those metrics that I've been talking about that can spring load this thing. We're just trying to pick our spot, Dave, like, I mean, it made no sense for us to build the forecast for the guidance around a Q2 start.

I mean I'm hopeful. I think it can happen. But we built it really around the Q3 start, right? So that's where it all is. It's in that time zone.

It's the three-month delta basically was sort of our planning strategy. But like I said, I've never seen our commercial team as optimistic and as bullish. And that includes PRS, right. PRS, even though it's a newer product and it's very highly dependent on supply chain, it's a really attractive set of products from a pricing perspective and from a technology perspective.

And it's running higher as a percent of revenue, for sure. It's coming in closer to 20%, 20-plus percent compared to 10% to 15%. And I think that's going to grow as well. So as a newer product, we don't have sort of an exact calibration on that pace.

But that's an overlay onto all of the great territory metrics, new rep metrics, new account metrics. We're feeding that great new product set into all of that as well. So it's not just the hernia story for 2021. I think it has been up until now, for the most part.

But I think the story is going to shift, and we're going to have two meaningful products here in the next couple of quarters to start talking about here, Dave.

David Turkaly -- JMP Securities -- Analyst

I appreciate that. And we've talked about you guys having the potential to be sort of a 100% plus growth company. And if I look at your midpoint guidance over 2019, you're sitting right around 84%, 85%. So I don't feel like you're far off.

But I guess as we look at that in 2021, obviously, understanding PRS is new, and thanks for the color on the mix right there, but I imagine it grows faster, but any color you might want to give in terms of hernia versus PRS in terms of how you get up to that guidance number.

Tony Koblish -- President and Chief Executive Officer

Yes, so I think thematically, right, let's assume we can crack the supply chain access through COVID. Let's assume that, that cleans up in Q2, right? That's going to help PRS tremendously. If you just look at the two procedures, right, the hernia stuff and the PRS procedures, hernia is definitely more impacted, it's more delayable and a lot of the volume of those procedures are more "elective" and delayable than the PRS procedures, right? So our feeling right now, having been through these ups and downs and COVID cycles, is that hernia gets hit harder. So the fact that we're able to grow our volume into the simpler cases in that period, I think, is a great sign.

We already talked about the complex, big procedures. Those are going to come roaring back and we're well situated for those. So then it's really PRS, which I think is going to be governed more on our ability to get access into the supply chain admin to get the new products started. I think the plastic surgeons, they have a bit more power in the system to get what they want.

The cost savings around our PRS offering are substantial and very attractive to hospitals in this environment. And all of that is going to play into our ability to get that product moving, and the fact that the procedure volumes are probably more stable through the ups and downs of COVID. So I would not be surprised if we saw a little bit more of a wait on the growth, at least, as we are in the early stages of transitioning out of COVID onto the PRS a bit as we figure out and crack the code on supply chain admin. And then we'll start to see the hernia, I think, be very much hardwired to the recovery, the COVID recovery.

And that will come back nicely as well, too.

David Turkaly -- JMP Securities -- Analyst

Thank you.

Operator

And I'm not showing any further questions in the queue. I'd like to turn the call back over to the speakers for any closing remarks.

Tony Koblish -- President and Chief Executive Officer

All right. Thanks, Victor. So I want to thank everyone again for your time this afternoon and for your interest in TELA Bio. Before concluding the call, I'd like to spend a moment remembering TELA's co-founder and chief medical officer, Maarten Persenaire, who passed away unexpectedly on March 7.

I had the privilege to work with Maarten for many years, and many of you have known him for many years as well, at Orthovita and here at TELA Bio. And I can honestly say that TELA Bio would not exist without Maarten. He was the co-founder. He put his money where his mouth was.

He was an investor in the company from the beginning, like most of us here were. And he cared tremendously about patients. He -- I share an office with him, and he's on the phone every day with surgeons discussing their outcomes and patients. And he also cared about the healthcare system.

Maarten wanted nothing to do with starting a company that didn't improve patients' lives and decrease the total cost of care to the system. And he really had tremendous pride in our company and he worked tirelessly to deliver clinical data, which we're going to benefit from for a long time. The whole BRAVO system is -- he's the architect of that. So we're going to miss him tremendously.

He's got a wonderful family, kids, wife, all of that. And our thoughts go out to his family. And all of us at TELA Bio will forever be grateful to Maarten, and we will continue to work to honor and build upon his legacy. The entire company is motivated to deliver and to deliver big results for him, for his family and for everyone involved.

So thanks. That's the end of my discussion.

Operator

[Operator signoff]

Duration: 49 minutes

Call participants:

Greg Chodaczek -- Vice President, Corporate Development and Investor Relations

Tony Koblish -- President and Chief Executive Officer

Nora Brennan -- Chief Financial Officer

Matthew O'Brien -- Piper Sandler -- Analyst

Matthew OBrien -- Piper Sandler -- Analyst

Anthony Petrone -- Jefferies -- Analyst

Kyle Rose -- Canaccord Genuity -- Analyst

David Turkaly -- JMP Securities -- Analyst

All earnings call transcripts