Q1 2020 Earnings Call
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Our speakers presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone keypad. Please be advised that today's conference is being recorded if you require any further assistance. Please press star zero I would now like to hand, the conference over to your.
Speaker today, Jonathan Neely. Thank you Sir Please go ahead.
Good afternoon. Thank you for joining US today, you review often as first quarter 2020 performance or plan to Europe and.
I'm joined today by our CEO, Peter Miller, President and Chief operating officer roaming on food, our Chief commercial officer, Good coal Valley, and our CFO keeps going down.
Was it will be presented on this call can be viewed on our website opt in those dot com and the Investor section before we start and we'd like to remind you that our discussions. During this conference call will include forward looking statements. All statements that are not historical facts are hereby identified as forward looking statements.
Forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated by such statements.
Additional information regarding these factors and forward looking statement is discussed under the cautionary note on forward looking statements section of the earnings release that we issued today, both under the risk factor section and elsewhere have often those his most recent form 10-K form 10-Q that as filed with the FCC and available at their website FCC Dot Gov and on our website adopting those duck.
You are cautioned not to place undue reliance on forward looking statement.
We're looking statements. During this conference call speak only as of the original data this call or any earlier date indicated in such statements and we undertake no obligation to update or revise any of these statements.
We will now make prepared remarks, and then we will move to a question and answer session with that I will now turn the call over to Peter Millar Theater.
Thanks, very much Jonathan good afternoon, everybody.
We appreciate you joining us for our first quarter update.
I hope everyone is safe and well these challenging times.
Before we get started with our business update the like to begin by thanking all my colleagues that up in those for the incredible job. They have done in rising to the challenges presented by operating in an environment completely reshaped by the corner buyers pandemic.
I'm proud of what they've accomplished in such a short period of time, finding completely new ways to support our commercial partners, our physician customers the patients they treat and the clinical researchers engaged with us in the development of expanse as a treatment for chronic sinusitis in true one mission fashion. This team has risen to the occasion.
Our view of the road ahead for optimal starts with a necessary non to the heros, who stand at the epicenter of the global response to cope with 19, our health care professionals.
The healthcare professionals, we serve salt unprecedented disruption to their practices and faced the necessary task of finding new ways to care for their patients while protecting themselves in their staff.
Today will provide an update or a business discuss how we've mobilized the organization in response to today's environment and discuss the important role that its hands will fill in the context of the emerging marketplace.
Starting on slide three.
We'll go into more detail in a moment, but I'd like to start by providing five key takeaways from today's presentation.
First since our last earnings update we primarily focused on adapting our business to drive performance in the Cobot 19 environment and we will dive into the details of actions, we've taken and how our business has performed during the initial weeks of entry into this new environment.
Second we're taking actions to reduce operating expenses and preserve cash given the economic uncertainties, while protecting our investment in our commercial model and modeling clinical programs. So that we emerged stronger and more prepared to realize the full potential of often those.
Third we are updating our guidance to reflect the reductions in operating expenses I just mentioned near term uncertainty for revenues and expectation for substantial improvement in expanse average net revenue per prescription for the remainder of the year.
Fourth we.
We will review first quarter enhanced performance, which provides continuing evidence that we have an effective commercial commercial strategy and our driving sustained growth.
And fifth we continue to believe the remains substantial room for long term growth and ex hands prescriptions and believe that the actions. We have taken in response to the current environment are strengthening our ability to win in the emerging marketplace.
Turning to slide five.
Since our last earnings update we have mobilize to drive performance in the Cobot 19 environment in which we now operate in March many of our physician customers began to experience significant reductions in patient volume relative to pre cobot 19 norms. Many also move to offer some remote visits as a means of seeing patients in the case of into surgeons many will.
Restricted by local authorities from performing elective surgery, one of the key drivers of the patient flow.
While this dynamic clearly presents challenges, particularly for seeing and initiating therapy for new patients. The koeppen 19 pandemic has not reduced the significant significant number of patients who suffer from chronic nasal disease and certain dynamics maeve and create new opportunities for expanse.
Although medical management and surgical care are generally complimentary the short term restrictions on elective surgeries increases reliance on treatment with medications such as expanse.
In the mid term backlogs of patient care during Lockdowns may continue to focus fix surgical capacity on the most urgent or severe cases with continued increases in the use of medications for other patients.
In the longer one an increase volume of positive treatment experiences with expanse should support our goals of broadening adoption and help disrupt ingrained treatment habits.
We're adapting our commercial plans accordingly, so that we emerge strong as this crisis evolve resolved.
The health and safety of the communities. We live in working is foremost among our concerns and we implemented a work from home model for all employees, if theyre function if their job functions allow starting in mid March importantly, our virtual model includes tools that enable our territory managers to engage in many of the types of promotional activities. They have in the past, albeit virtue.
Finally, rather than face to face they can detail physicians provide samples and host educational programs.
Our territory managers have gained increasing comfort with the new suite of digital engagement solutions, but we've also prepare plans that will enable them to stay protected and productive as they reengage in person with their practitioners has offices scale up to meet the backlog of deferred patients.
As I just mentioned despite the clear negative influences of the crisis environment. We've also identified certain environmental factors that we believe may favor trial and adoption of expanse in this evolving period.
Increased virtual care reluctance of patients to make in person visits to offices and pharmacies concern over potential for disease transmission risks with nasal procedures constraint elective surgery and other factors all may contribute to two dynamics like the ones I discussed a moment ago.
We are working to identify these emerging opportunities and respond by partnering with physicians to improve care in new ways.
One early response launched on March 25th is the expanse assist program.
To offer an option with potential to help physicians and patients face with postponement of elective surgical procedures and reduced office visits assist offers a full three months of expanse to new commercially insured patients delivered to the home at zero out of pocket cost.
Based on the recent strengthen our refill business. We believe this program is a worthwhile investment for our business our customers and ultimately for our patients.
Longer term, we expect this program will accelerate new patient initiation.
Feedback from physicians on the Asus program has been quite positive.
Our clinical trials investing expanse as a potential treatment for chronic sinusitis have had to adapt to the cobot 19 environment as well.
In response.
All global trial sites have temporarily pause new patient enrollment.
Sites in different regions are adopting say practices and adhering to varying regional guidance for resuming medical care during the pandemic.
We expect enrollment to gradually began to restart during may.
For subject the will already enrolled procedures to facilitate ongoing treatment and capture of data have been put in place.
While the coven 19 environment add some uncertainty we're maintaining our previous guidance related to the expected timing of topline results, which are expected in the second half of 2021.
Finally, given the uncertain economic uncertainties created by the global pandemic, we've taken actions to reduce our full year 2020 operating expenses by approximately 17 million compared to the previous guidance.
Importantly, we have planned reductions that we believe will protect our ability to continue to fully execute our growth strategy for expanse and allow us to reaccelerate growth as the environment stabilizes and and doctors offices scale backup to manage the backlog of patient visits.
As we discussed on our last call we learned that the enhance business has been highly sensitive the promotional efforts and we believe it's important to protect our ability to drive growth and evolve the standard of care for the 10 million patients suffering from nasal polyps.
Keith will have more details in his remarks.
Turning to slide six.
Before I move to the first quarter commercial review I'd like to call out the performance of expanse. During the initial cobot 19 crisis period.
Expanse prescriptions increased by 8% for the six week period ended April 24, compared to the prior six week period ended March 13th.
The six week period ended April 24th is notable for two reasons first it is the first six week period, when our territory managers transition to our virtual model and second because it coincides with the nationwide coven related environmental shifts that led to substantially reduce patient volumes for our target physician audience.
Anecdotally some of these physicians are practice groups of relate to us. The during this time they experienced patient visit decreases in the range of 50% to 90%.
Given that environment, we are encouraged by the resilience of its hands prescription volumes.
At a time when many businesses are reporting decreased growth rates and decreasing volumes, we believe expense as a proven treatment for chronic condition has underappreciated relative strength.
Turning to slide eight.
Turning to our first quarter results, we continue to be very encouraged by the growth in total prescription volume for its hands in what was largely a pre cobot 19 environment.
Our last call, we discuss factors common to chronic diseases disease products with a high refocus with high reefer representation, such as co pay resets in insurance Reauthorizations for ongoing prescriptions, which we believe influence refills and average net revenue per prescriptions early in the year.
Late in the first quarter in the last couple of weeks in March we began to see the impact of the pandemic built from the starting point of a strong trajectory in late February and in the first weeks of March.
As we did on the last call. In addition to overall Trx performance, we will now dive a bit deeper into details and help described the performance of the business.
In the first quarter 2020, there were 22300, new prescriptions for a chance a 75% increase in new prescriptions compared to first quarter 2019.
We believe the continued continuing to generate strong new prescription growth at this point. The launch is a very good sign of the health of the business and contributes to our confidence in strong long term future growth.
Refills supported by reminder, programs managed by our preferred Pharmacy network partners are a true strength of our business in first quarter 2020. There were 33700, we fill prescriptions have a chance a 246% increase compared to first quarter 2019.
Turning to slide nine.
Pulling the new and refill prescriptions together the total number of its hands prescriptions in the first quarter of 2020 was approximately 56100. This represents 149% growth over the first quarter of 2019.
It's not shown here, but but by the leave it but I believe it's important to note that prescription growth rates within the first quarter improved as the quarter progressed up until the point Workover 19 restriction starting to put some pressure on growth as previously noted.
And our last earnings call, we discussed in depth to concept the for medications, particularly chronic disease medications early in the year. There was a downward pressure on refills related to patients who change insurance.
This change of insurance can drive the need to have a new claim approved before refilling for the first time in the new year.
In line with our expectations refill growth started to recover in mid February and continue to improve up until the point Workover 19 began to put pressure on growth.
Notably this first quarter effect, which we expect to be a recurring phenomenon was much less pronounced for enhanced last year due to a much smaller proportion of prescriptions coming from refills in the first quarter of 2019 compared to 2020.
This emphasizes the tremendous growth in refills during 2019 and increases our confidence in future prospects based on the underlying engine of our new prescription trend.
Believe it's important to highlight this dynamic with refills because they are now approximately 60% of expands prescriptions a major driver of value over the long run and after a blended start in the first weeks of 2020 rebounded as forecasted.
Turning to slide 10.
We believe there was a large market for expanse and therefore believed that there was tremendous upside the remains for us in the current target audience of physicians.
Expanse share expressed as a proportion of all international stereo prescriptions written by physicians in our target physician audience increased from 1.5% in first quarter of 2019% to 3.8% in the first quarter of 2020.
This is a great increase but the numbers also illustrate the magnitude of potential for continued growth.
Overall, we are confident that our continued execution against our current commercial model can continue to increase share in 2020 and convert physicians from early experimenters to more substantial wires.
Notably we've continued to see share growth in recent weeks in the colder 19 environment and believe we will continue to be able to produce share growth, especially as returned more traditional promotion across the balance of year.
Turning to slide 11.
Another measure of performance that we monitors the number of physicians, who have patients filling a certain number of prescriptions per quarter.
What you can see is that both breadth and depth of prescribing has increased over the last year.
Regarding breadth in the first quarter 2020, more than 6300 physicians had a patient fill at least one prescription of expanse, an increase of 71% compared to first quarter 2019.
Regarding depth the number of physicians with patients filling more than 15 prescriptions in the quarters grew even faster.
With a number of physicians with patients filling greater than 15, increasing by more than 200% from the first quarter 2019 to first quarter 2020.
We believe this sustained trend is indicative of one key mechanism supporting continued growth of the product and a future product potential as we see an increasing number of cold on physicians, becoming fullscale adopters.
His talk group of physicians is important to our business and we believe that this growing subset of Adaptix hands as a part of the treatment paradigm due to results. They are seeing in their own patients and because their experience is that access and affordability are generally not a barrier.
Growing this growing the size of this group is a strategic priority for the company.
In a few moments I'll provide some closing remarks, but I will first turn the call over to our CFO Keith Goldan for comments regarding our first quarter 2020 results and perspectives regarding our corporate guidance.
Thank you Peter and thank you to everybody for joining today.
As we reported upturn is recognized $7.1 million of expense net revenue in the first quarter of 2020.
As noted on prior calls one of the metrics that we track is expanse average net revenue per prescription, which is calculated by dividing net revenue for the quarter by the estimated number of expense prescriptions dispensed during that quarter.
We continue to believe that this is a useful metric to evaluate net revenue generated per prescription.
Over we remind you that this metric is subject to variability.
The variability as result of factor factors that do not necessarily reflect a change in the price that is paid for an individual unit of his hands, including ordering patterns and inventory levels for our wholesale customers and pharmacies that we sell to directly.
Utilization rates of patient affordability programs, the proportion of patients acquired expense through an insurance benefit and other factors.
Based on available Accenture prescription NAV third parties and also on data we received directly from preferred pharmacy network partners.
Our average net revenue per prescription for the first quarter of 2020 was $126, which was within our guided range of 120 to $140.
Moving to slide 14.
This afternoon, we revised our corporate guidance to reflect effects of the current of ours pandemic on business and actions, we're taking to reduce operating expense.
First we are withdrawing full year 2020 cents net revenue guidance and we'll evaluate providing guidance. Once there is more clarity regarding when public health efforts to mitigate the spread of covert 19 were relax and away that permits abroad return to the in person model for Xsense promotion.
Previously.
We expected expense net revenue to more than double compared to 2019 expense net revenue of $30.4 million.
Second we remain confident that it had net revenue per prescription when approved for the remainder of 2020.
Because the major factors that influence our gross to net deductions has not experienced structural change relative to where they stood in 2019.
Overall market access, which drives rebates is generally consistent.
And the terms of our base co pay assistance program are unchanged.
Expected increase in expanse average net revenue per prescription from the first quarter of 2020 to subsequent quarters is primarily driven by two effects that we have discussed when we set expectations on our last call.
And that we believe our comment for chronic treatments in our industry.
First because of patient insurance deductible resets that occurred in January we expect Copays support provided by us under our assistance programs, which brought the out of pocket expense effects of deductible resets on patients.
To the highest in the earlier in the early part of the year and a decrease as the year progresses.
The second factor contributing to this increase is the recapture of refill prescriptions, but patients whose insurance coverage change with the new year.
We fill prescriptions are relatively more profitable than other prescriptions, because a higher proportion of these patients have insurance that covers expense.
Patients, whose insurance coverage change with the new year for example to different ensure can experienced delays and refilling. The prescription if the new claims to be process before refill can be provided.
We believe its hands refill prescriptions experienced some of this effect in early 2020, which created downward pressure on both expense net revenue and expense net revenue per prescription in the first quarter.
We predicted and in fact observed increasing number of rebuild prescriptions as the quarter progressed and as a result believed that the year as the year progresses. This dynamic should support improvement in average net revenue per prescription.
As mentioned earlier, given the economic uncertainties presented by the global pandemic, we're reducing expenses and expect an overall reduction in 2020 operating expenses of approximately $17 million compared to our previous guidance.
These expense reductions include the Reprioritization of project spending a reduction in payroll costs.
And lower 2020 clinical trial expenses as a result of pauses in new patient enrollment.
As a growth these company we're oriented towards building for promising future.
To get there, though we are always mindful that we need to be judicious with capital and focused on optimal early deployment against our growth objectives.
Consequently, the extraordinary circumstances, the pandemic required some changes to our plans.
Importantly, as we look forward to relative normalization of business conditions, we believe that we've maintained the capabilities necessary to both reaccelerate expense growth and pursue our development objectives for his hands as a treatment for chronic sinusitis.
For the full year 2020, we expect total operating expenses to be in the range of $131 million to $136 million.
Of which approximately $11 million is expected to be noncash stock based compensation.
Total operating expenses, excluding this stock based compensation are expected to be in the range of $120 million to $125 million.
Finally regarding our clinical trials evaluating extensive the potential treatment for chronic sinusitis.
While kobin 19 restrictions add some uncertainty.
We are maintaining our guidance related to the expected timing of results.
I'll now turn the call back over to Peter.
Three months.
Thanks Keith.
In closing the Cobot 19 environment is created real challenges for most businesses, including ours, the full impact of which has not yet fully known.
We remain confident we have a business capable of continued strong growth, but are mindful of the areas, where we need to focus to produce that growth is begins with maximizing results in the currently constrained promotional environment, but even more importantly means understanding how the market is likely to evolve and develop plans to capitalize on opportunities as regions of the country begin to reopen may.
Any geographies physicians are telling us that they are already beginning to take actions to give patients the confidence to return to their offices for care.
We know that many regions of the country or reducing restrictions on elective surgery, which will potentially facilitate efforts, but we're watching carefully how patients will react.
We're working closely with physicians to continue to play our role in assisting them and aggressively working one plans to produce an acceleration of our business with the market evolves.
As we look further out we remain excited by the potential for expanse, especially given our growing yet still modest share penetration and the significant opportunity to could be created by the addition of chronic sinusitis indication.
Thank you and I would like to opening up the call for QNX.
If you would like to ask the question at this time simply press Star then the number one on your telephone keypad, we'll pause for just a moment to compile the culinary roster.
Okay.
Our first question comes from the line Randall Stanicky.
Hi.
So that until you may be on mute, if you're trying to ask question right now.
Okay.
Operator could you just move to the next question. Please.
We come back to Randall I Hope Brian.
Our next question comes from the line as.
Gary.
Matt.
Hi, good good afternoon, net that rothsay on for Gary.
Good afternoon.
Hi, how much pressure are you anticipating net revenue prescriptions over the course of a year.
Just as some patients may migrate the caliber met pay from commercial given some of that broader macroeconomic trends.
Yes, we don't think thats going to have an enormous impact on the business.
No doubt is going to be some migration, but we are a very largely a commercial business and as we look across the balance of the year. We continue to be confident as Keith said, we're going to see the as we expected as we've talked.
Nice rising increase of average net revenue per prescription.
Obviously, there is going to be some impact of people who are.
I cannot handle our displaced because of their other jobs, but I do not think is anything that's going to be that significant at this point.
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Got it.
And then do you have any visibility on Dx Gen. Two ways GNC stores heart rate change telemedicine and how comfortable if they are potentially starting new patients on expands virtually.
Well I mean, the think we know pretty much for sure we sort of said it in the call is that.
The physician practices over the past six weeks have been pretty impacted in terms of in person patient visits and also overall patient visits.
Tickets, we got many anecdotal reports of reductions of 50% to 90% the huge majority of the practices both entities Analogist in tried to enable a virtual care.
However, particularly in the case of the in TS a lot of what they do is a physical exam of patients within endoscopic evaluation. So they all move towards it.
They saw a lot less patients is what they told us in the virtual visits the thing that we felt really good about and I mentioned this on the call is we did see increasing share in our business in the six weeks post the pandemic. So.
It's a year question about their comfort of using expanse I think the growth in share. We saw isn't good sign that there's real comfort news in the product and as I mentioned in my remarks, we think expanses potentially set up in a really positive way.
With the pandemic given that patients are going to have delayed surgeries.
And other things Theyre going to force delayed care doesn't mean, the patients are still suffering and medical treatments potentially are going to be more utilized and we think expanse could be in a very good position to capitalize on that.
Great. Thanks, so much.
Our next question comes from the line Ken category.
Hey, guys just had a couple of question I know both most recent data that we all avenues from April 24, and this is such a fluid situation, but I was wondering can you take us all the way up kind of as close to the upset admitted as you can being that we were seeing a little bit of an inflection on the 24th can you just talk about what you're seeing.
Even more recent than that.
The trend still moving into right direction, and then on X emphasis.
Sounds really interesting program to just get into little bit more detailed this wrapped up kind of in shop or did you you having someone execute this for you it looks like a good way of kind of capturing patience and getting even more intimate with them once you get them.
And then.
Lastly, could you just based us on where coverage stands as we exited last year, and where we stand real time and I noticed some moving parts with although high levels of unemployment, but give us give us a sense of the covered lives, where we were where we are.
That'd be great. Thank you so mark.
Thanks, Ken I mean, 24th is pretty up to speed up to date, but I will tell you that down we obviously have some leading indicators that we look at end.
Up till the moment, if you will the trends are pretty consistent of what you saw across the six weeks, we continue to see on a nice resiliency to the business honestly.
And we're seeing that obviously in the six weeks that we reported but also in I guess, it's a week and a half that has been since then.
We continue to feel this is a business that is resilient and as I mentioned in the call a lot of acid do with a refill business remains solid on and the new prescription business actually is is doing frank little bit better than what we would expected given the significant decline in patient volumes. So on and I will say can were this week we.
Add about 50 of our hundred territory managers out in the field this week.
Now how productive they are and how busy offices are that's yet to be seen but I think theres encouraging signs. We know that physicians are are interested in getting back into their practices.
In terms of assist the beauty of assist Ken and it may have been completely clear here. This just leveraged the patient support program. We already had in place. So this is not creating something new for physicians. They write the prescription the same way they historically loaded to our preferred pharmacy network.
On the only differential is we added instead of I think you know we always offer the first month free as part of our patient assistance programs because of the pandemic. We thought it made sense to offer three months free so the nice thing about it was it didnt require a dramatic change on the part of physician.
And in terms of what they had to do and as I said, we heard very positive feedback from physicians and how much that's contributing to our ability to sort of sustain our business during the pandemic and as I said earlier grow share. During this timeframe, we don't really know, but it's certainly we've heard some good anecdotal.
Comments about it regarding coverage and Vic Cavalli can jump in hit by the way has been a tremendous addition to our team as our Chief Commercial Officer I think we introduced Vic on the last call came over from Pfizer.
But in terms of coverage weighed about 75 to 80 per percent. It's reasonably consistent we do see line of sight can to getting to closer to 80, and eventually even 85% I don't know for sure whether it will happen over the balance of the year, but we have we're in discussions with payers and.
As I said C line of sight to getting that 80, 85% in a reasonable near term Vic anything to add.
Peter the only thing I'd add to that as we approach. This pandemic, we really looked at it from three perspective spores, how do we keep our employee safe. So they can return to the field when they could secondly, we wanted to enable them with tools that would make them more effective when they did return to the field and you spoke to that a little bit on another third part of as we looked at program like assist to see if we.
Could expand the patient opportunities the number of patients that each position would consider us for and and we're pleased with where that's worked.
And I know guys here is your we're looking to save a little bit of money here at it makes a lot of sense, but any thoughts on when we could turn on DTC with the kind of coverage that you are talking about.
At some point getting closer over the 80%.
Any kind of updated thinking around that we're still in test mode. When DTC can I think as I said in the last call. The thing we know pretty confidently based on the pilot that we've we've been running use that we can activate patients.
The thing we got to make sure that we have in place is broad physician awareness of the product because we can't it's hard we were trying to steer patients into NTN allergists.
But that's the piece we have to continue to work on before we do brought expansion.
Got it thank you.
Our next question comes from the line as David and sell them.
Thanks, So just had a couple first just a clarification on the net revenue for Rx.
I know with the launch of the expense assist program you're.
Offensively, providing more pretty products, so im wondering how of that.
Impacts.
Net revenue per Rx and and I realize that you you're you're providing just directionality also can you talk to have that would in fact.
That metric Thats number one and the number two is as you think about.
The promotional landscape.
What's your sense regarding how much of this whole virtual model is going to endure post pandemic. They might mean for your overall level of seven longer term. Thanks.
2000 to talk about impact on average net revenue for animal at Vic talk about.
The virtual model.
Yeah. Thanks for your question.
So youre right. So the the assist versus the other program, which you know as zero 30 50.
Given given three prescriptions at zero co pay whereas the zero 30 50 give one.
We would anticipate it to have a negative impact on average net revenue per prescription we probably so some of that in the.
End of the first we were very very probably last week of the first quarter prided impact average net revenue per prescription too much.
And in the second quarter, there will be a larger magnitude of effect. However.
The we don't anticipated to have a good to have a really big impact from a full year perspective on average net revenue per per prescription and as I made a comment that in my remarks, we expect to see the increase.
This year very consistent with last year again, because of the fact that our co pay at the base co pay assistance program, which.
This is still largely utilized.
Is consistent with what we had in place last year and as Peter just commented our commercial coverage is largely largely consistent with what we saw last year, yes, David if any would ended at two is that assist we project in clearing. This was the program only is going to run through the end of May and it's only on new prescriptions. So if you.
Put it in the context of the full year, it's it's a few months.
And it's it's it's only meal the refill business as we said earlier refills now sevenc over 60% of our business.
So not materially consequential really intended for those patients that.
Havent been been on expense before that were perhaps waiting for surgery, because they are surgery got delayed.
I'll, let you handle the promotional question on virtual.
So we will not a suite of virtual tools to help the representatives engaged with the physician and perhaps in the connection to the question around assist Asus actually ended up being a very valuable catalyst to encourage physicians to engage with us virtually so they could learn about the program. We were really pleased with the number of physicians, who engage with us and frankly, the number of times recruiting.
Each with those positions.
Clearly faced a faces the more effective way for us to communicate and.
Communicate our message.
We believe that build via continued place for virtual engagement moving forward, we've learned a lot about it when we see how it can help our model. Even stronger addition, Ding Ding day, I'll add deck busy Vic and the team were Sharon's and data with me. This morning that if we can get really a true virtual engagement with a live detailed virtually if you will.
It's actually really pretty effective on so I, obviously phone calls and emails are are not as effective.
What a true virtual engagement with a veeva engage our platform, which we have enabled to on our sales team actually proven to be pretty effective.
I'm not quite as effective as a face to face, but it's something as Dick said I think it's something for sure over the next few months, we're going to continue to use in it might become part of our of how we work with physicians on ongoing basis.
That's helpful. Thanks.
Again, if you have a question. Please press star one on your telephone keypad. Our next question comes from David Steinberg.
Thanks.
Couple of questions.
First off I know you suspended dealer.
Revenue guidance for the year.
That means you.
You don't think that revenues will at least double or you're just not sure.
Secondly, I know you said you reduced your expenses in one of the items. The reduced payroll did you lay off any sales reps or any other notable equal in the company.
And then the lastly, I may have missed it did you asps last year for the year 198.
Have you confirm whether you think there'll be at that level or a different levels for the for the courses of 2012 cents.
Hey, David Thanks for the questions as Keith ill start with your last question first.
With respect today SP, Peter made some comments upfront, but again, we're not going to provide at this point average net revenue per trx for the full year.
Largely related to the economic uncertainty going forward and.
We comment a little bit on on the changing.
Dynamic of the patient basin we.
It's unclear today.
If or how increased unemployment is going to affect average net revenue per script.
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Could it could affect our payer mix it could affect overall.
Healthcare benefit utilization, we just don't know so not trying to do a dance around around it but the honest answer is we're not going to provide guidance at this point, we don't feel confident in projecting that hit the thing I'll say there was a key citizen remarks, David structurally you know we nothing is dramatically.
Changed year over year in terms of.
Payer contracts rebates coverage so.
You would expect continuing inkwell were guiding that you're going to see continued increase and if the dynamics that Keith was referencing don't materialize.
I'm not going to say, it's going to be equivalent to last year, but I'm going to say that the structure will elements are pretty similar.
So working backwards. Your second question was about the.
Operating expense reductions and specifically with with respect to payroll.
The as I as I commented in my remarks. The objective here was was balancing the preservation of balance sheet strength.
With the maintenance of the ability to drive expense growth coming out of the back end of this uncertain period, and we need to salesforce to accomplish that.
So we were able to to get the 70 million of savings, while still preserving the commercial structure as it as it stands.
And then go into your first question on revenue guidance.
If visibility improves.
We are going to evaluate.
Reissuing guidance for the year, but at this point just for the for the reasons I commented earlier just don't have the.
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