Q4 2020 OPTIMIZERx Corp Earnings Call
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Good afternoon, everyone and thank you for joining us for today's call.
Excuse me.
Good afternoon, and thank you for joining us today to discuss optimize Rx Corporation's fourth quarter and full year ended December 31st 2020, with us today, and the Chief Executive officer of optimize Rx William rebel and.
And the company's President and Chief strategy Officer, Mary and Paramour, they're joined by company Chief Financial Officer, Doug Baker.
And Chief commercial officer, Stephen Sylvester will.
Following their remarks, we'll open the call for questions before we conclude today's call I'll provide some important cautions regarding forward looking statements made by management during today's call.
To remind everyone that today's call is being recorded and will be made available for telephone replay via instructions in today's press release and the investors section of the company's website now I would like to turn the call over to optimize Rx CEO William <unk>. Sir. Please go ahead.
Thank you, Greg and good afternoon, everyone and thank you for joining us today.
Record number of switches.
Which is great and everyone's welcome and I'd like to begin once again and expressing our gratitude to the countless healthcare professionals across the country.
Let's continue exactly to work tirelessly and Selflessly and battling the pandemic and keeping us all safe and.
And who are now leading the charge and administrating the vaccines and the most vulnerable and those on the front lines.
Work their way to the general population.
Over the past year. The pandemic has clearly accelerated the shift towards digital health by both physicians and patients and especially for physicians looking to keep their operations going.
And adapt to the new widespread challenge of delayed <unk>.
According to a recent study done by the American Medical Association, nearly 90% of doctors and the U S and significant advantage and using digital tools to engage with and treat patients.
Moreover, over half the physicians and the study say they are looking for more access to clinically relevant data and workflow improvements at the point of care, where they're treating their patients.
There is any silver lining around the pandemic it would be how the compelling and important benefits from the adoption of telehealth and especially the digital health solutions like we provide has been accelerated by at least five to 10 years. That's one of the first major movers and the point of care digital health space, we've been able to reap the.
Of this industry transformation as well as be a leader and setting a high standard sort of reaching physicians and patients and a way which supports decision making around care.
This includes delivering the most innovative solutions with better support patients and health care providers with affordability access and adherence and.
While this shift is already well underway before the pandemic as evidenced by our growth over the last few years, we are now witnessing and even more astonished and acceleration towards digital solutions.
And this has transformed the vastly expanded our total addressable market in fact, and Q4, we more than doubled our top line, while generating positive GAAP net income and this was largely a result of a strong organic revenue growth.
We see this combination of organic growth and innovation for solutions.
Will drive us forward in 2021 and beyond.
We also practice, what we preach so that as we have continued to drive our own internal digital transformation as a company earlier last year, we restructured our organization to align with what Mckinsey refers to as the digital factory or small. This model has been shown to bring products to market faster do more with existing resources.
And create a dramatically reid match and experience for clients.
It can also reduce tech development costs by a third and most importantly attract great talent required to compete in a day.
Digital world and avoided that payoff last year.
Powered by our own digital transformation, we successfully broadened our platform to encompass more solutions that enable doctors to Gardner access to important per patient for their patients at point of care.
We are now at the right place at the right time, and facilitate a critical and timely communication between life science companies physicians and patients.
Our results also reflect how we have made great strides with innovation during the pandemic and particularly with the launch of Telegraph, our new virtual communication solution. This cloud based solution that enables providers to reach the right pharma contact from within the EHR workflow with just one click helping fill the communication GAAP.
Created by limited face to face interactions due to COVID-19.
In fact last December P. M 360 magazine recognized <unk> as one of the most innovative solutions for life Sciences, very proud of that and.
In addition to existing solutions and the platform. We are now leveraging real world data to deliver real time information at the point of care with our new AI powered real world evidence solution.
And our sophisticated proprietary algorithms that power the solution also enable us to derive additional revenue from our existing network.
Over the last year, we've continued to shift our business model towards enterprise level engagements with recurring revenue streams, leveraging the trust and we built with our clients over the last several years.
Client renewal rates at the end of 2020 reached an all time high all while adding 60, new brands to our platform.
We've also found that we can help to digitally commercialize new products for pharma at a time with face to face sales are virtually impossible that is no visiting reps industry conferences or in person presentations this supports and ever expanding available market and tremendous growth opportunities.
Our solutions are now providing the central communication pathways for pharma.
Connect with physicians and patients through the patient journey with a focus on affordability access and adherence are digital health footprint continues to expand with more pharma clients on boarding onto our platform and we are working relentlessly to steward health data and ways that can effectively yield better outcomes for all the stakeholders.
And especially for the millions of patients who are connected to us now.
Now before I go further I would like to turn the call over to our CFO, Doug Baker, who will walk us through the financial details for the fourth quarter and year Doug.
Thanks will and good afternoon, everyone.
Earlier today, we issued a press release with the results of our fourth quarter and full year ended December 31 2020.
Copies are available for viewing and may be downloaded from the Investor Relations section of our website.
To file our form 10-K, with our full results and the second week of March.
Now turning to our financial results from the fourth quarter and full year 2020.
Our revenue for the quarter totaled a record $16 4 million, which was up 123% compared to the same year ago quarter. Our revenue for the full year increased 76% to $43 3 billion driven almost entirely from organic growth of our corp solutions and patient engagement.
Gross margin for the fourth quarter totaled $8 6 million, which was nearly double that of a year ago gross margin for the full year was $24 1 million up from $15 $4 million and 2019.
For the quarter, our gross margin percentage came in at 52, 4% versus 66% a year ago for the full year was 55, 7% versus 62, 8% and 2019.
This lower percentage in Q4, which impacted the full year as well was the result of our solution mix much of an incremental business that came in Q4 was related to lower margin solutions that were very easy to launch and fulfill and short time periods, even though our gross margin was lower this incremental business almost all falls from a bottom line, which demonstrates the leverage and our model.
Looking ahead, we expect our margins to remain and the 56% to 58% range in 2021.
Our operating expenses increased to $7 $2 million and fourth quarter of 2020 compared to $6 8 billion and the same year ago period. This is almost all the result of variable expenses associated with the added revenue. However, even though our revenue was up over 100 per cent for the quarter operating expenses were up less than 10% and once again, demonstrating the substantial leverage of our model.
Operated operating expenses for the full year of 2020 increased to $26 2 million compared with $19 1 million.
The increase in operating expenses in both periods were largely due to the scaling up of our operations to support continued customer and solution growth, including additional staffing as well as the full year impact of the acquisition we made in late 2019.
GAAP net income for the fourth quarter of 2020 was $1 4 million or <unk> <unk> per fully diluted share compared to a net loss of $2 million or <unk> 14 per share and the same year ago period.
Net loss for the full year of 2020.
The total $2 2 million or <unk> 15 per share, which improved by about 900000 and from a net loss of $3 1 billion or 23 per share and.
2019.
Non-GAAP net income and the fourth quarter, and 2020 was $2 7 million or <unk> 16 per fully diluted share, which compares to a non-GAAP net loss of 400000 or <unk> <unk> per share and the same year ago period.
Non-GAAP net income for the full year of 2020 with $3 2 million or <unk> 20 per.
Fully diluted share compared to non-GAAP net income of 900000 per seven cents per fully diluted share in 2019.
Now turning to our balance sheet cash and cash equivalents totaled $10 5 million at December 31, compared to $12 million on September 32020.
Earlier, this month, we reached $71 million and and and.
Equity offering we plan to use these funds to further expand our business and accelerate revenue growth.
Our receivables are very high quality because of our customer base. They continue to pay regularly and predictably and there are days out sale day sales outstanding continues to be constant.
We remain debt free and do not anticipate needing to raise additional capital and a new future either for operating purposes or to fund our growth.
That wraps up the discussion of our financial results now I'd like to turn and we will call back over to will.
Thanks, Doug today more than ever and optimize Rx is evolving into the nation's critical communications platform for patients physicians and life science companies.
Bold statement, but we're really living it like no other digital health platform and the market and we deliver important information real time at the point of care right and clinical decisions are being made.
We have access to tens of millions of patients and most physicians as well as the technology compliance operational support to continue to play a major role and the ever evolving digital health market.
Partnerships with EHR and E prescribing companies and enable us to augment the physician workflow.
With actionable insights by providing additional real time critical information to clinicians who are dealing every day with complex health care scenarios, we can improve the patient and physician experience and ultimately treatment outcomes as Doug mentioned over the last year, we've continued to expand our team and preparation for.
For the growth opportunities ahead.
Enhanced our leadership team across financial legal compliance and strategic planning.
To help us unlock more reach into our client base recently and you look on a joined US in November of 2020, as our new senior Vice President and principal and agency channels.
His experience with developing partnerships that bring digital touch points together at the point of care greatly complements our mission of helping life sciences, the present through that care journey.
You might have noticed the press release and we saw Angelo was named and <unk> 40 under 40.
And just as it is just a positive thing for our company and it's perhaps not surprising that we're seeing immediate results from these efforts that will positively impact our growth.
We've had a great start to the year and remain focused on key growth drivers of land and expand within our clients selling our platform solutions across brands and connecting more doctors to more patients we.
And we see a real world evidence solution and accelerating all of this by a factor and a way that works for everyone involved. We are however, very much looking at enhancing our reach to certain therapeutic areas and additional patient populations. We continued to be focused on unlocking access to patients via our channel partners as a differentiator with the patient engaged.
And it solutions.
The funds from our recent equity raise will be used to invest and our current platform Fund continued innovation open additional M&A opportunities and further solidify our market dominance in this space. It was clear from those who participated and the raise that our story is very understandable.
Sensible and scalable all while still being very early and our evolution.
And 2021, we expect to see a continued favorable shift to higher margin recurring revenue.
Enterprise deals and we believe our pipeline growth has been driven by a permanent shift to more digital enablement.
We have 46 enterprise engagements and our pipeline as we start 2021 valued at more than $50 million let's.
A significant increase over this time last year, and we expect that continue to grow inside this year.
This breaks down to about 31 potential deals value to up to half a million dollars 11 up to $3 million and four 3 million or over this does not include several that have already closed and all of the above range is including the 3 million plus it's safe to say our shift away from tactical and towards enterprise engagement is being very well.
And by our clients.
For all of those prospective engagements, we expect to realize our traditional annual closing rate of between 35 and 50% over the course of the year.
All of this represents great progress and with adding in the in your buying and year and by a potential we see another year of strong growth ahead.
As we continue to invest in innovation and enhance the scalability of our technology and commercial teams. We believe we have the momentum at least aspirational.
To reach 100 million revenue run rate with the client's network and team we have today.
Deloitte recognized optimize Rx is one of the top 500 fastest growing companies in North America, and we expect to remain on that list now.
And now with that we'd like to open it up to your questions Greg.
Thank you very much sir and ladies and gentlemen, and if you'd like to ask a question. Please signal by pressing star one on your telephone keypad.
And if youre using a speakerphone and just make sure to use excuse me and make sure that your mute function is turned off to light signals from each of our equipment.
Again, Thats star one for any questions at this point and we'll pause for just a quick moment.
Alright, and first <unk> from William Blair, We have Ryan Daniels. Please go ahead.
Yes, thank you for taking the questions and congrats on the strong performance this year.
Well, you talked a little bit about the need to drive more preventive care going forward because of some of the lapses that occurred during COVID-19 and people avoiding offices or office shutdowns can you talk a little bit more about your patient engagement platform and some of the things you can do to help doctors and generate that revenue stream number one.
And then number two is that revenue stream comes and does that also have a multiplier effect on your core messaging business because we're in the office and the doctors will start receiving.
And some of the marketing and branding campaigns as well.
Sure Yeah, Hey, Ryan Thanks for the question.
The first part.
And we strategically decided that you really have to look at the benefit the ultimate beneficiary of everything we're doing which is the patient and.
And as everyone knows about two years ago.
And two acquisitions, we bought the technology that enabled that one to connect directly to the mobile, but frankly to deliver content patients any way they want.
And we and while that's a crowded space we liked it because we were one of the only ones that have such a broad network of physicians and so the unlock here potentially.
Is a which is a tool to facilitate less meetings between doctor and patient and not more is the ability for a doctor to enable a patient right and the workflow to join and adherence or compliance program, which which really helps the patient understand.
The Medicare.
Medication treatment, both emotionally and intellectually. It also helps them afford it because we can obviously attach any kind of savings and that this is available for that same communication and it's right on the mobile so that that answers a little bit of your second part of the question.
Aside from just the unlock and we feel is coming.
The other piece of it is it drives some of our core messaging solutions physicians enabled today and just another format, which which help patients afford their medications, which is obviously a very large issue in the market certainly with many people being disrupted from work.
And that's even more and more important today than it was say a year ago.
Okay. That's helpful color and then one of the things you highlighted growth via press release intra quarter and and in your comments as kind of your investments you've made and artificial intelligence and machine learning and.
I'm curious if you can talk a little bit more about how that actually changes the deployment of your solutions.
And integrates into the physician workflow and kind of make it a smarter technology for both your your patients and your provider partners.
Yeah, I'll start and then I'll ask Steve to jump in and can see.
Driving this effort, but if you think about.
And what we've been doing to date the true.
Triggers were fairly straightforward.
Disease code.
And some search functionality around the patient, but there's just so much more.
Data available today from a real world based evidence, which which allows you to be smarter with how you message and what creates the message. So where we may have had one trigger maybe too we may have four five and now that allow us to deliver the right information to the doctor at the <unk>.
Time based on the profile of that patient there see.
And.
And it's just something that our clients have been looking at R. W. E T.
For years using it for training for to drive marketing messaging, but rarely have never been able to use it to actually directly connected to point of care and a way that doesn't require someone to remember or something so hence the machine learning algorithm.
Steve maybe you can give a little more color from a client perspective on that.
And I think he did a great job there will haywire and good to hear from you.
The only thing and I would add to what Louis.
As already said is that.
What this allows us to do is to plug into the broad ecosystem of these massive real world evidence database and saw the announcement and Komodo and there will be some other subsequent announcements pending.
And obviously, we've got a partnership with Osama and he's got a great repository of data as well and what happens and essentially you have access to patient records and and longitudinal historic in nature, and there'll be refreshed and real time and so the algorithms can trade on that history, and a patient level rolled up to the physician level and they can begin to predict.
Didn't need your Ryan's and you can start to understand and for pension is tracking to and a positive diagnosis day.
And we can be prevented and messaging that position.
Helping them understand and things should contemplate or think about running certain tests et cetera to two and it didn't help.
And that patient.
And different ways and it kind of comes back from question that you and asked previously around patient engagement Lincoln and this and there and it also helps and a preventative way, but it essentially and connections to the broad ecosystem and as you heard will say, it's a force multiplier around messaging because our messages have been limited up until the goodness to whenever we can see inside that.
Consistent with connection that and have now it's higher health care.
And across my.
Total deposit towards the data and all of these patients.
Right.
And maybe last one from me just thinking about the $180 million of pipeline opportunity and the strength and close rates to move towards digital marketing.
For manufacturers and in general obviously, a ripe opportunity from you to capitalize on and can you talk a little bit more about what you anticipate from a SG&A spending perspective in.
2021, as we think about in particular.
Sales and marketing investments, whether its direct sales force or just.
Other kind of digital and brand marketing and capability for the organization and as we grow there to drive awareness of your offering thank you.
Yeah. Thanks, Ryan So I think as people digest, what they're seeing and Q4.
Wanted to just mention two things one and this.
Company, clearly has tremendous leverage in SG&A and keep them or we don't generate content. We are a tech company and we facilitate connections through our network and so.
You should not expect a.
Heavy growth and SG&A as we continue to scale the business.
We will selectively add in areas that make sense like we did Q4.
And with a couple of people and you know you and you're growing like this and you're in the right places and the right time it can be highly selective with people. So we really feel honored to have that position and.
And are able to get some terrific people.
Onboard so.
And you should not expect dramatic you should continue to see leverage as we scale up year over year.
Okay, great. Thank you and congrats again.
That's right.
All right moving on our next question and it's going to come from Andrew Desilva with B Riley Securities.
For taking my questions and congrats on the progress.
So a lot of my questions were just touched on but just to start obviously the book.
Fourth quarter saw a very significant increase and just that.
Seasonal spanned across your platform I'd be very interested if you could just kind of discuss.
And what you learned as it relates to your platform is the ability to scale.
Just based on that and then maybe you could just tie that and with a little bit more color on how that translates to the operating leverage that we've seen and talked about how that looks going forward.
Thanks, Andy.
Yeah, you know it's.
And I've been in the pharma world for over 20 years, as Steve has as well and.
And you.
And you just know and Q4 Theres always some magic that come to you Ray and the fear is that magic is something you can't do right.
That's just a very frustrating so one of the reasons why and just loved this business. So much is we can turn on a dime and react to our clients' needs and.
And really important stuff.
And taking.
Real clinical messaging financial assistance and patient engagement and enabling it very quickly.
Based on activity at point of care and so Q4 was an example of.
Goodbye up matter of fact, we saw higher buyouts, and we traditionally see and and.
And I think we can safely say that there was excess budget.
Because of some of the lack of spending on.
And the rep visits and conferences.
But the good news is we were able to capture every dollar that we were asked to and.
And as you can see and the and the P&L.
And as Doug referenced in his section the leverage screams through so.
That will hold true as we go forward it's.
It is not something we have to stop build adjusts to call our partner and get us back.
Three simple and.
And and obviously, we've been working really hard as they have been growing to make sure.
Team is right the tech is scalable and and.
Compliant and secure so feeling really good about that leverage.
Okay, great and useful color.
And really interested in your inside in the pipeline and sort of curious if the cadence.
And from Rfps coming in and contracts being awarded is following what has historically been seen.
Or if and you.
We expect to see off cycle, Rfps and contract awards coming similar to what you saw last year.
Well, I'll say, a little bit and and pass it to Steve you know, there's obviously, there's always seasonality to pharma day, startles saw and buildup and.
And just look at the first half and you can definitely look at a bigger second half.
Traditionally so.
We have seen a stronger start this year, which is great and I think that's a testament to the enterprise.
<unk> type deals we have our renewal rates are the team the operational team just being there are account managers are exceptional.
Being very connected to both our clients and anyone that supports our clients.
So I I see.
Similar profile to last year, just more business, Steve do you want to comment anything on that.
Yes, I think that's right. The only addition that I would make is one of the other PC gaming.
You've seen sort of accelerating business for us.
Our.
And as far as pivot a little bit from using in the field physical rats.
And looking for different ways to reach physicians and I think he problems and saw the fight and emphasizing on some skus and the engine announcement.
And there will be similar announcements that will follow and whether they are public corp.
Its just being done without actual announcements.
But those broad sweeping layoffs or reductions are going to happen and so of course, those funds will be deployed and.
And that is.
And also strengthening the case and the business.
And because we do have an ability and willingness and soon.
To reach the physicians and pharma wants to speak to and to.
And communicate those messages and do it real time.
And as essentially better and then putting and physical representative in front of your position and from less disruptive from organic and germane to what they do.
And of course, with Colorado, and if they still need to speak to a physician. Thank you just hit the button.
Knockout and sneaker and speak with the.
And that so for that reason and I think that's also helping to accelerate.
And that's a great point.
That's what we're thinking about but.
And useful context, but nonetheless, and then the last.
The last question and that has related to the $180 million plus pipeline number and that the.
And that you noted in your prepared remarks.
Is that net of contracts already awarded or is that a growth or a cumulative number.
Yeah.
Yeah.
That is net of.
Okay.
Okay, great well. Thank you very much very useful context, and the best of luck going forward.
Thanks, so much thanks Andy.
And moving on from Lake Street, we have Eric Martin Newsy.
And my congratulations on Q4, as well and dive into the Q4 gross margins and I think.
Two 4% was certainly below what I was modeling and I know you said it was due to the change and the solution.
I don't want years past, sometimes in Q4, you are either re upping and we're trying to win new distribution business.
And anything to do with it or was it really more product choices.
Yeah, Hey, Eric.
All about solution mix and you know I think that that's the that's what it is there and you know that the beautiful.
The thing about our business is and it's like.
You hear in this day and that's just the leverage right. So we're not concerned about the gross margin and know how to manage it.
A lot will be driven off activity and and we still feel over time that continues to improve but if there is ever a chance to bring and the revenue and execute it for our clients. That's needed we will do that and and that's what you saw in Q4.
Just a heavy heavy ask around some of the legacy solutions and legacy partnerships, which have a higher Rev share.
Okay and then.
And it's something.
You talked about kind of Q4 seasonality is it something we should just anticipate and our model is.
Gross margins are going to be 50, 50, and 58 over the course of the year.
Should we just naturally be anticipating.
Sort of I don't want and called a budget flush.
You have a better term for it.
Yeah.
Is that just kind of model from volume in Q4.
And we're doing that.
Yeah, I think I think you can go with the range as we gave annually.
You know if the sway one or 2% either way, it's not going to be material, obviously, if they're growing.
And if they're going up and that's great for everyone and if they are going down and that means the top is growing so I.
I think just taking that sort of a directional guidance per aspirational guidance towards that range and there's plenty for models, both for you and the investment community.
Okay, and then speaking of aspiration.
I noticed you didn't give us a year and what you're gonna have a $100 million and revenue.
So we've got a potential revenues of $100 million I just wanted to dive into that yet you have talked about a shift to more subscription type revenue and recurring type revenue.
And the year, where you do achieve that 100 million and revenue.
Percentage of subscription.
Oh, that's a good question I mean, I would think we're at at least half if not more.
In terms of enterprise and we felt that enterprise right that's contracted nature at 12 months.
Very recurring and.
That would be our goal and yeah, we don't give guidance. So we don't put a date on it I think what's more important is we have the team to get there right. Aside from maybe a few select tires. So we that that should screen, we're going after it hard.
And there's that leverage we keep talking about.
Yeah.
Okay.
And for Doug on the operating expense side.
And can make and opex was going to be a little bit higher in Q4.
It turned out to be I think it came in at seven two.
And what should we.
Thinking about either for full year or Q1, if you wanted to just focus on the near term here as far as operating cash.
Yeah.
So I would say.
If we look at the full year.
Absence of society and to make some larger investments and growth you should see less income per no more than 10% growth and opex.
And you could even see some declines in the and Q.
Q1 from the seven point to because there is a little bit of relationship to revenue. So.
Mhm.
Okay.
Just a last housekeeping item here.
The share count we should be using for Q1, given the range.
And you give me shit there.
You could add.
And so somewhere in the $16 8 million something like that.
Okay and congrats again, thanks for taking my question.
Thanks, Eric.
All right and moving on from RBC capital markets, we have Sean Dodge.
Hey, good afternoon, and you can find the scholar one for Sean and thanks for taking the question.
Well go and kind of going back to revenue growth.
A lot of momentum here and I was there any way to kind of unpack how much of a tail and Covid awards for you in 2020 or even into 'twenty and 'twenty, one and I guess kind of when we look ahead is there any sense you can give us what you think kind of a more sustainable longer range growth trajectory could and should be.
Yeah. So we've talked a lot a little bit and Q3. So we didn't feel like we saw any revenue.
Up until Q3 from Covid, we saw a lot of internal referral we saw a lot of learning a lot of exploration.
Clients tend not to move quickly on these things they have to digest it.
Q4, though I would say we saw a couple of million and additional buy up just from larger excess budget.
Going forward I think.
Because of this shift.
Ourselves and we've got big expectations to keep growing this business I've always said.
You know theres, a 25% to 30% growth is is there's so much room for us with that is that is achievable and I feel like we're not doing our job if theyre not doing that are beating it.
And we don't give the guidance, but I think given all of these things and you mentioned between our we're.
Really embedded well and our clients there's tons of white space, there and we've got the solution set that's critical and.
And we've got the reach today and all.
Obviously, we're always looking to augment that so I would say we'll.
We will feel just overall macro tailwind and this year will continue to be disruptive for pharma. So I think both to Eric and to your question as.
As we get to the end of the year, there probably will be additional excess budget as well.
That's very helpful. Thank you and then kind of one more on physician reach.
You had mentioned and integration now, hoping you get to 60% of docs.
And does that kind of a fully penetrated and remember there are there and kind of more of the HR platform and when do you think you can add to get there and even higher proportion, where you feel and closer to that kind of 990% daily EHR users you guys referenced.
Yeah, you know for us as we shifted to largely specialty medications.
Sure.
You know smaller populations are harder to reach both physician and patient.
It's less of a volume game.
For us at this point, it's really fine tuning and network and finding areas, where if we added a reach it would immediately add revenue and provide solutions for our clients. So we're really focused on that we're not focused on going after the big numbers there are plenty of.
EHR sales that were not fully integrated into and of course, we work on those every day, but.
I think the important takeaway is we're not reliant upon them back.
If you see analysis come through I would focus in on therapeutic area because that will be that's a bigger unlock for us in terms of revenue potential.
Okay that makes sense very helpful. Thank you and congrats on the growth.
Thank you.
Yeah.
Okay.
Yeah.
All right and then moving on ladies and gentlemen from and veneer capital We have Brandon Austin has our next question.
Hey, well hi, how are you doing guys.
Hey, Brandon.
Uh huh.
Good day area man and I'm just I.
I know you guys don't guide so.
I just want to sort of work around.
You guys have put out there so in terms of and terms of your sales breakdown right. Now you know roughly how much how much of how much of your <unk>.
Quarterly revenues at this point are you know enterprise SaaS recurring versus message and like what kind of run rate and you guys running at right now if we if we sort of.
Bunch of everything that is volume dependent.
Yes, it's and it's a good question. It's a fair question, where we'll be able to dive into that a little bit better based on for 'twenty. One based on reported and Q1 right. Because we will have had a lot of conversion by that and we can look at the percentages.
But it's you know the.
And if it's around 50% now it's at right now.
Based on last year.
And it makes sense right I mean for our clients why would they do this and it's multiple solutions. So it takes them working with maybe a few other providers. They just work with us.
One last one measurement.
The measurement tends to be in terms of the ROI, it's exponentially better when you just have more outreach to the same patient and physician populations and through one platform.
And you can watch prescription behavior.
And I would expect it'll be there for a while and then hopefully chip heavier as we as we get more and more people on board.
Right and if I look at 2019, I would assume that it was less than 50 per cent at that point because this is not a completely yet as much. The so basically the enterprise SaaS non messaging non volume dependent and part of the business is clearly growing over 100% that.
Is that safe to say do you have.
That part yeah, that's that's safe to say and it's also but it's not.
There is still a volume dependency and some of US it's not a 100% pure.
Bill monthly. Thank you very much. It's it's still I think it will move that way more and more overtime and thats. The only thought that would it's a carve out from that statement.
And as a part of it.
And I'm trying to sort of interpret your pipeline.
Pipeline comments, you know you have your medium and the enterprise is $50 million.
Is that when you guys talk about the pipeline and the enterprise is that all additive to the current run rate of enterprise.
Sales right now like if you guys executed on.
50 million of and a product all 15, obviously, Walt but all $50 million of enterprise sales.
Would that be additive to your current run rate or does your current run rate include.
Like is that pipeline include renewals or something.
Yeah, Yeah, no it's not additive it's it's.
Yeah.
The full year again, it's not additive.
It's not sorry, so sorry, when you say it's.
And our run rate as part of that yeah. That's the run rate, we're proud of that pipeline.
Okay and that in terms of our pipeline and so it really included as part of the pipeline.
Yes. It is that one and includes 50 50 right now and.
Price.
But if you closed on 100 and Navy and pipeline. Your revenues. Your current run rate of revenues would go up something less than 100 ideas that maybe a good way of framing. It as we closed 180, then your revenues would be whatever you did last year plus one eight.
No no it would be it would be and it doesn't go on top of a run rate that is the total cash going after for the year total number you're going after from there okay great.
Okay, Alright and.
Hey, that's great that's great for now and signed up to speak to you and wanted to conferences and when their future. So I'll follow up that that's exactly what I talk to you and thanks, Yeah. Thank you.
All right and moving on from pop Tech L. P. We have Harvey a couple.
Please go ahead, yes, well great job and congratulations as you know we've been Oh.
For many many years and this has really been a blowout quarter.
I just want to make sure that I've got this right that you.
You've just reported numbers that were actually higher than what you pre announced only a month ago. In other words, you went from 16 and 16 4 million.
And in terms of fourth quarter revenue and.
And your pipeline went from $170 million drawn and 80 million and that's up about 6% just in one month and said they got it right.
That is right and it also includes US closing some business right, so which we won't tell you what it is but that certainly means there was probably greater than a 6% increase and the pipeline.
And.
Getting back I don't know you've had a number of questions on this but I'm going to come out and from their direction and interpret the pipeline and <unk>.
Trying to understand it's ultimate effect on revenue.
And if one were to simply take 35% to 50% and multiply upon and Navy you get 63 to 90.
And does that imply the range of revenue that you might be able to achieve this year, where and so there's something about the $180 million and it takes us out much further.
Yeah, we talked about that and Q3. The pipeline is generally 18 month view, so it's not apples to apples and it's a little bit of spillover into 2022.
And so you need to you need to give a little bit to that.
And maybe for the six months into next year.
Okay and Tom.
And lastly, you liked it.
And lastly on the new cash that you've been able to raise and you've mentioned and.
And of course, you're raising and and again today that M&A is part of that.
Is there a sense of and your M&A strategy at this point.
And whether that's earmarked to just one or two large deals or is it more likely to be a whole series and much smaller deals.
I'll start and then I'll ask maryann to chime in because she's going to be running point for us on that effort.
But no I think I think we feel very sufficient with technology.
Sort of startup technology add ins.
If we're going to do something we want to have it be more.
More substantial and accretive inside our guardrails.
Just because of the effort that it takes to do those.
But Mary monitor you add a little bit of colors of that and if you don't mind.
Okay sure.
And.
And we have a number of opportunities that we're looking at and it is as easy to buy them or as easy or as hard to buy something big and it is to buy something small.
So without.
Now and cause a little bit of it's opportunistic and everything is tightening and she now.
And we think we've got a good filtering process, we've got a number of opportunities. We're looking at and we've got some that we've kind of pushed out.
And I think we'd prefer something a little more substantial and without you know nobody has a crystal ball pardon me and so.
But we certainly don't need to buy anything that's infrastructure and related or if that improves our cash based because were really pretty solid there.
But you know anything that's anything that's out of care and we want them, we want them accounts.
Great. Thanks, Thanks, a lot I'll step aside graduations.
Thanks Sarah.
Alright, and then moving on we have Ron Chez next up.
Good afternoon.
Good afternoon, Mr. Jess.
So somebody already or are you commented about 100 million Aspen.
Aspirational goal. So that's that's not aspirational.
For 'twenty, one right I mean, that's outdoor assets here.
You don't want to do that and 21.
Oh, no way why would I know why would I want to do that now.
The point of [laughter] different line of that number is is we absolutely have the team to do it and we've got to reach to do it and we have clients, who have certainly plenty of appetite to do it but I would never commit to that are you know that that guidance. This is really I think to give.
Our investors and future investors just a glimpse that one that's this is really early.
And two we've got the current infrastructure to get there and you know we.
We all want it to happen faster always were pretty aggressive group and.
But we can see we've got the team to do it which is which is really exciting.
So given the market and customers. This is still early innings.
Oh yeah.
Steve can comment but I.
I think this.
I think that we were seeing really good adoption.
It wasn't the early believer sell anymore, even pre pandemic.
But post pandemic, you've had massive internal referrals for us.
Just more awareness and the corporate setting of digital enablement and if we all use zoom a lot next trickles into marketing and then doctors and patients are just more attuned to using technology to help them maintain their practice or patients just manage their lives basically so.
Steve maybe you can comment to the client side.
Yeah, sure Hey, Ron.
And part of the growth that you see and the numbers and you talked about obviously the new brands.
Critical but.
Mental games and enterprise clients that might have on and on the platform scale and what's on solutions to Will's point and so as that continues to go and I'll leave a large number of brands and are on the scale up to the different solutions and are on the platform by brand, but they also do that and it.
And level.
And then cases, where our brands and operating 456 different diseases and that represents six different programs for optimize Rx. So there's tremendous growth since it's very.
Tremendous white space for us to go out and you can see and capture.
Okay.
And one other aspect of growth is.
And number of cars.
Cars, and Hcp's and I don't want to comment on that at all.
I think we covered a lot of it I think the key is focusing in on these specialty therapeutic areas.
Areas, where like oncology, which will dominate them the marketing spend for <unk>.
Decade.
So we're really focused in on that it's at this point its a fine tuning and it's not a volume game and.
We by the way have a lot of capacity and our existing network. So.
And when we talked to white space on the brand side. We can also say the same thing on reach to physicians and but I think our partners through this change I mean, you imagine what they're going through adding telehealth and all sorts of services.
I just think there's a really good atmosphere for collaboration and innovation at the channel level and and we really I think do a great job being collaborative and innovative with them. So I expect some good things there this year.
Thank you for your efforts.
Keep grinding.
Thanks, Ron B well.
Thanks.
Alright, and folks moving on the last question, we have and the queue is from Singapore with silver and mountain capital.
Hi, good.
Good afternoon and junior.
Just two quick ones from me please.
Firstly would it be fair to say that the patient engagement piece is the key driver of ROI and pharma companies and what do you think that's what's driving the shift and customers from a.
Pay it and go to and enterprise contracts moving from us with those questions.
And the second question is in terms of your addressable market or your serviceable addressable market do you believe that this extends beyond branded paint and good drugs.
How do you think about this from a patented buses and off patent and perspective, thanks a lot.
Sure sure. So it's good to hear you.
No I would not say that.
Patient engagement and is driving.
Itself the shift to enterprise deals.
Just to remind everyone. When we about two years ago decided to really focus in on the patient journey.
And the critical places to reach doctors and patients along that for our clients.
And patient engagement is certainly a critical piece of it.
And it's one we can all kind of relate to is people.
Patients and consumers and health care, but the awareness and the amount of drugs coming to market and the amount of interactions between those drugs, whether they're branded or branded with generic is complex and it's really hard to keep up so what's.
And what's really driving the enterprises want it's just easier to buy more from the same company. So we did that too we have more touch points and anyone in the market relative to getting information inside of the workflow at point of care for doctors and then have a wonderful way to stay with the patient and help them understand.
And and afford the medication.
So.
It's not the sole driver of patient and gauge it but it's definitely a piece of it and that's why we did it strategically.
And relative to Tam total available market brand brand as the majority of our revenue and.
You've seen companies like good Rx and our expense, helping people get discounts on any product.
And really getting that down to a transparent level that you've been picking the pharmacy you should go to so we really like that it brings awareness transparency doctors are more aware that there is discounts available consumers are certainly and this whole consumerism trend and while we are largely a b to b type.
Company.
Any awareness at the consumer level helps drive.
Awareness for what we do and so I do think.
It along with just the expansion of things like telehealth.
And I have largely expanded our total available market and open the ice stuff to pharma and others that this is a really good channel to connect and share and help deliver the right information at the right time, so yeah great questions.
Uh huh.
And so we'll actually have a I have a couple of mobile apps and they don't just take them off line, but thanks very much.
Great and have a good night.
Alright, and at this time and it does look like that concludes our question and answer session I'd now like to turn the call back over to Mr. <unk>. Please go ahead Sir.
Well, thanks to everyone for joining the call today are we hope your main takeaway from our discussion is.
Is the understanding of our ability to generate tremendous value for our shareholders and everyone involved.
And this is thanks to our strong organic growth, our sustainable competitive advantage and our favorable market timing.
But beyond all the numbers. We hope you appreciate that we continue to foster a unique culture, one dedicated to do something truly valuable.
And which would make a difference in people's lives from patients to physicians and beyond.
We do not provide guidance as an early stage public company and especially in this current environment, but given everything you've heard today. We hope you are optimistic as we are as we navigate this transformative period now with that let's wrap up the call Tonight. Thanks, Greg.
Alright, Thank you, Sir and before we conclude today's call I'd like to provide the company's safe Harbor statement that includes important cautions regarding forward looking statements made during todays call Steve.
Statements made by management during today's call may contain forward looking statements within the definition of section 27 day and the Securities Act of 1933.
And amended and excuse me section 21 E. At the Securities Act of 1934 as amended these forward looking statements should not be used to make investment decisions and the words anticipate estimate expect possible and seeking and similar expressions identify forward looking statements. They may speak only to the.
Such statements are made.
Such forward looking statements and this call includes statements regarding estimation of total addressable market size and market penetration revenue growth gross margin operating expenses profitability cash flow technology investments growth opportunities acquisitions upcoming announcements and the need for raising additional capital.
Also include the management's expectations for the rest of the year and adoption of the company's digital health platform. The company undertakes no obligation to the publicly and excuse.
And any publicly update to publicly update or revise any forward looking statements, whether because of new information future events or otherwise.
Looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified future events and actual results could differ materially from those set forth and contemplated by or underlying these forward looking statements and the risks and uncertainties to which forward looking statements are subject to include but are not limited to the.
The effects of government regulation and competition and other material risks and risks and uncertainties to which forward looking statements are subject to could affect business and financial results are included and the companies or excuse me are included and the company's annual report on form 10-K for the fiscal year ended December 31st 2019. This fall.
And it is available on the company's website and on the SEC website at S. E. C. Dot Gov before we end today's conference I would like to remind everyone that this call will be available for replay. Starting later this evening running through March 17. Please refer to today's press release for dial in replay instructions available via the company.
And so website at www dot optimize our ex dot com. Thank you for joining US today. This concludes today's conference call you may now disconnect.
Yeah.
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Hum.