Good day, everyone, and welcome to iSpecimen's Third Quarter 2021 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow management's remarks. This conference call is being recorded. A replay of today's call will be available on the Investor Relations section of iSpecimen website and will remain posted there for the next 30 days. I will now hand the call over to Allison Soss, Investor Relations for introductions and the reading of the safe harbor statement. Please go ahead.

Thank you, operator. Good morning, everyone, and welcome to our iSpecimen’s third quarter 2021 results conference call. With us on today's call are Christopher Ianelli, iSpecimen's Chief Executive Officer and President; Tracy Curley, Chief Financial Officer; and Jill Mullan, Chief Operating Officer. Before we begin, I would like to remind you that today's call contains certain forward-looking statements from our management made within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities and Exchange Act of 1934, as amended, including with respect to the company's recent IPO and the anticipated use of the net proceeds as well as concerning future events. Words such as may, should, project, expects, intends, plans, believes, anticipates, hopes, estimates and variations of such words and similar expressions are intended to identify forward-looking statements. These statements are subject to numerous conditions, many of which are beyond the control of the company, including those set forth in the risk factors section of the company's registration statement and the final prospectus for the company's initial public offering filed with SEC. Copies of these documents are available on the SEC’s website at www.sec.gov. Actual results may differ materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation to update these statements or revisions or changes after the date of this call, except as required by law. Now, it is my pleasure to introduce Christopher Ianelli, CEO and President of iSpecimen. Chris, please go ahead.

Thanks, Allison. Good morning, everyone, and thank you for joining us today on our third quarter 2021 earnings conference call. This is our second quarterly earnings call as a public company and I'm excited to provide you with an update on our progress. With me are Tracy Curley, or Chief Financial Officer; and Jill Mullan, our Chief Operating Officer. We will begin by providing you with an overview of our operational and financial performance during the three and nine months ended September 30, 2021. Following that, we will open the line to take your questions. To start for those of you that are fresh to the iSpecimen story, we are a technology-enabled life sciences company, focused on accelerating scientific and medical discovery through our iSpecimen marketplace solution and online biospecimen market platform that enables life science researchers to instantly search for and gain access to patients, biospecimens from these patients, and related healthcare datasets from a global network of health care providers. There is remarkably strong demand for annotated human biospecimens within the life sciences markets, due to the essential roles that they play in medical research. Without them it would be impossible for researchers to conduct life science research and develop tomorrow's diagnostic and therapeutic products. There is an estimated $3 million to $4 billion spent annually on biospecimen procurement with a projected growth rate of 10% to 15% per annum. However, this market remains highly fragmented and suffers from a variety of supply chain issues. This is where iSpecimen comes in with its game changing approach. The iSpecimen marketplace streamlines the entire biospecimen procurement process by connecting life science researchers to a global network of patients and biospecimens, available iSpecimen’s partnered hospitals, laboratories, bio banks, blood centers and other health care/supplier organizations. By using our platform, researchers can…

Thank you, Chris, and good morning, everyone. Today I'll review our financial results for the three and nine months ended September 30, 2021, compared to the same periods in 2020. We reported revenue of approximately $2.7 million for the third quarter of 2021, a 20% increase compared to approximately $2.3 million for the third quarter of 2020. As Chris has already mentioned, our results for the third quarter of 2020 were boosted by increased COVID-19 specimen demand. While our results for the third quarter of 2021 were more typical, reflecting what we would consider normal biospecimen procurement activity and demand during this period of the year. For the third quarter 2021, non-COVID-19 related revenue was approximately $1.8 million, or 66% of our quarterly revenue, compared to approximately $838,000 or 37% of revenue for the third quarter of 2020. Complementing these numbers COVID-19 related revenue was approximately $923,000 in the third quarter of 2021 or 34% of our quarterly revenue for the period, compared to approximately $1.4 million of COVID-19 related revenue for the third quarter of 2020, which represented 63% of revenue. The number of specimens accession during the third quarter of the current year decreased by approximately 700 specimens, or 12% to approximately 5,300 specimens, compared to approximately 6,000 specimens accession during the third quarter of 2020. However, a favorable change in the specimen mix resulted in an increase in the average selling price per specimen of approximately $138 or 37%, compared to the same period in the prior year. During the nine-month period ended September 30, 2021, we reported revenue of approximately $8.6 million compared to approximately $5.5 million during the same period last year, a 57% increase. Our revenue for the nine-month period ended September 30, 2021, has exceeded our full 2020 results for revenue, which was…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Priyanka Mahajan with ThinkEquity.

Please describe the enhanced custom biofluids collection service. Is it technology based? Has the company expanded its network in the cancer space? Just wondering the mechanics of it.

I’m going to let Jill answer that question. She heads up supply development. So go ahead, Jill.

Yes. So the enhanced custom collection services, the ability for us to do a couple of things. One is to collect specimens internally at iSpecimen. So we have the ability to now recruit patients and bring them to our site and collect the specimens from them. We're using mobile phlebotomist to help with that. And we can also send the phlebotomist out to the site, so allows us to very quickly collect from patients who otherwise may not be intersecting with health care systems. The other piece of it is providing those same services to health care providers to patients. They also not be connecting with the health care system, but may be able to participate in research. So it's a way for us to gain access to those patients much more quickly.

[Operator Instructions] The next question comes from James Lieberman with Revere Securities.

You're clearly accomplishing a great deal in a really short period of time in terms of how you're developing your business model and adapting to the times. Can I derive or conclude from the figure? You said that you have received purchase orders for $12.8 million for the year of 30%? Would that mean that you have approximately $4.2 million backlog?

No. So our backlog -- I don't think we put this number in our press release. But this is a public conversation, so I'm happy to share it. We ended the quarter with a backlog of approximately $7.5 million plus or minus. So the backlog is made up of obviously the orders that we've taken in but have not yet shipped samples against those orders. So $12 million in POS came in, we had a backlog from the prior year that carried forward. So the revenue, the eight point something million dollars in revenue includes shipment against POS that we've taken in, shipments against the backlog in previous quarters and then what remains of the backlog rolling forward.

Is it valuable how that backlog plays out and how it ship? How do you view that? Can you give some color to it?

Yes, so what we typically do is at the beginning of the quarter, we will evaluate the backlog and look at the aging of the backlog along with the types of specimen requests in the backlog. So as an example, if we have requests for bank samples that are in the backlog, those are things that we know we can ship in a relatively short period of time. And we would estimate that most of those will ship over the course of the next quarter. If we have prospective collections in there, depending upon the collections, the collections can take weeks, months and sometimes years or longer. So we'll look at collection by collection rates, what the -- collection by collection what the collection rates have been where we expect them to be making estimate against what we think we will ship against those samples. So there's a backlog analysis that gives us a good sense of what do we think will ship against the backlog in the current quarter, that then indicates to us what do our targets need to be for what we call book turn, which is request that we bring in that we can book and actually then turn it into revenue that quarter recognizing that many of those will also have a backlog associated with them going forward in future quarters.

And it does give some sense of trying to get an idea of as was described the seasonality of the business where the third quarter was tends to be lighter, but nonetheless was good number this quarter and going into the fourth quarter, would there be a seasonality stronger color to that or characteristic to that?

Yes. So typically, we do see a stronger fourth quarter. And this is due in part to folks trying to spend budgets before the end of the year. And so historically, our fourth quarter has been the best quarter of the year for us.

I show no further questions in the queue. And at this time, I'd like to turn the call over to Mr. Christopher Ianelli, CEO and President for closing remarks.

Thank you. I'd like to thank everyone again for joining us on today's call and for your continued interest in iSpecimen. We look forward to having follow-up conversations with many of you and to seeing many of you at the upcoming events that we have scheduled. As a reminder, we are scheduled to attend A.G.P.'s Biotech & Specialty Pharma Conference virtually on Wednesday, November 10, and the Craig-Hallum Alpha Select Conference virtually on November 16. And with that, I'll give a final thank you and wish everybody a good day. Take care.

Ladies and gentlemen, this does conclude today's conference call. Thank you for participating and you may now disconnect. Have a good day.