Q1 2021 Neuronetics Inc Earnings Call
Good day, and thank you for standing by and welcome to the narrow net ex reports first quarter 2021.
<unk> results conference call at the time, all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need the press star one on your telephone. 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 comfort of your speaker today Mark Klossner. Please go ahead.
Good morning, and thank you for joining us for neuro networks first quarter 2021 conference call of.
A replay of this call will be available on our website for 30 days.
Joining me on today's call are narrow net ex president and Chief Executive Officer, Keith Sullivan, and Chief Financial Officer, Steve Furlong.
Before we begin I would like to caution listeners that certain information discussed by management. During this conference call will include forward looking statements covered under the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995, including statements related to our business strategy financial and revenue guidance the impact of <unk>.
Over the 19 and other operational issues and metrics.
Actual results could differ materially from those stated or implied by these forward looking statements due to risks and uncertainties associated with the company's business.
For a discussion of risks and uncertainties associated with narrow networks business I encourage you to review the company's filings with the Securities and Exchange Commission, including the company's annual report on form 10-K, and the form 10-Q, which will be filed later today. The company disclaims any obligation to update any forward looking statements.
Made during the course of this call except as required by law.
During the call, we'll also discuss certain information on the non-GAAP basis, including EBITDA.
Management believes that non-GAAP financial information taken in conjunction with U S. GAAP financial measures provide useful information for both management and investors by excluding certain noncash and other expenses that are not indicative of trends in our operating results.
Management uses non-GAAP financial measures to compare our performance relative to forecast and strategic plans to benchmark our performance externally against competitors and for certain compensation decisions reconciliations between the U S. GAAP and non-GAAP results are presented in tables accompanying our press release, which can be viewed on our website.
With that it's my pleasure to turn the call over to neuro net ex President and Chief Executive Officer, Keith Sullivan.
Good morning, and thank you for joining us I'll begin by providing an overview of the first quarter performance followed by an operational update.
Steve will then review our financial results and I will conclude with our thoughts for the balance of 2021 before turning to Q&A.
From the time I joined the company in July of 2020 until the end of the year. My number one priority was to understand who our patients are where they are and how we can best educate them as they seek to find relief from their depression.
As part of that exercise, we partnered with the market research firm to review the M. D D patient landscape and identify the ideal patient population for Neurostar advanced therapy for mental health, we wanted to learn what communication tactics would be most effective in reaching and developing relationships with those patients.
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With that study completed in late 2020, we use the findings to develop a new commercial strategy focused on building awareness of Neurostar to ensure that we are helping our customers find and treat as many patients as possible.
In parallel we went through a process of optimizing our sales force, which included a rebuild and training of both the business development managers or BMS, and our neuro practice consultants or npcs.
After beginning our newly aligned commercial organization together in late January.
To introduce these concept of and conduct training, we were able to shift into execution of the strategy. We've worked multiple quarters to develop.
We have seen early success in our first quarter performance reflects the traction.
Despite many of the programs and initiatives not launching until the beginning of February.
Starting with the review of the first quarter total revenue was $12 $3 million up 7% over the first quarter of 2020, primarily driven by strong year over year the growth in treatment session revenue.
Our U S treatment session revenue was up 18% over the first quarter of 2020. This strong year over year performance was driven by growth in the installed base as well as for the positive impacts of our new patient education programs and our Npcs beginning the process of training our exist.
Sting accounts.
Coming into the year. Our goal was to have treatment session revenue approach 2019 levels by year end I'm pleased to report that we have achieved the skull with the first quarter of 2021 treatment sessions.
Revenue, surpassing first quarter of 2019 by 9%.
One of the many metrics we captured through track Star is motor threshold tests.
Which we view as a leading indicator of treatment session revenue as they represent new patient start during the first quarter motor threshold tests increased by approximately 24% over the first quarter of 2020, indicating business is getting closer to normal.
On the capital equipment side U S. Neurostar advanced therapy system revenue declined by 32% over the first quarter of 2020.
This performance was in line with our expectations for the newly hired sales force who was we're working within a shortened 60 day quarter, having been put into the field on February 1st.
Despite the short window of our BD EMS, we're able to engage with physicians and generate several hundred new opportunities within our CRM system in Q1.
And are adding more every day.
While it is difficult to say when those opportunities will convert into capital sales. We are very encouraged by the initial progress and continue to expect BD EMS to be increasingly more productive through the balance of the year.
To date, there have been over 112000 patients who had been treated with the Neurostar advanced therapy for mental health of.
The unique advantage, we have relative to all other companies in our industry is the ability to accurately track treatment sessions and patient data on a real time basis.
Through our track Star system.
In which 80% of our installed units are linked via the cloud we can track treatment session data in real time gives.
Giving us true insight into our business and patient trends as they develop.
Our track Star data indicates that we have seen strong treatment session utilization trends in the first three months of the year. During the first three first quarter. The number of treatment sessions has increased by 15% over the first quarter of 2020.
And more impressively increased by over 55 per cent compared to the first quarter of 2019.
As we moved into April for the first time ever we are now averaging over 3000 treatment sessions per day.
Following the significant planning efforts over the last few quarters. The first quarter represented our transition in the execution of key initiatives to build awareness and motivate patients with depression to requesting the aerostar and.
And train our customers to best on the best practices to educate patients who are searching for an alternative to drugs on the benefits of neurostar during the quarter, we optimized our digital and social media marketing campaigns expanded our concierge call center efforts and launched.
The two new customer programs. In addition, we continued to put the pieces into place to execute our clinical and regulatory strategy.
Beginning with our marketing campaigns are key driver of our growth strategy is to leverage digital and social media marketing to build awareness educate and then engage patients to request neurostar of appointments during the first quarter, our digital campaigns drove over 25 million.
Online targeted.
<unk> impressions, which represented a material increase over the first quarter of 2020, our media strategy optimizations based on market research resulted in a meaningful shift in the age demographic of the patients seeking treatment with neuro star.
Particularly those in our targeted age range, who we did not directly target with the previous marketing initiatives.
Importantly, we saw the impact of our improved messaging and our ability to engage potential patients in the quarter. These efforts to build awareness generated more than a 30% increase in patients who proactively requesting an appointment with the psychiatrist in their area after seeing of neuro.
Costar advanced therapy for mental health advertisement online.
A significant percentage of patients requesting appointments with Neurostar are now coming through our concierge call center the <unk>.
Call Center has ramped quickly since its launch and over 90 accounts are currently qualified to receive leads.
The initial results are very exciting.
And just a few months thousands of patients we're motivated to go online and pick up the phone to seek treatment with neurostar. The strong response rate validates the messaging and types of campaigns, we have been running and proves the value we can deliver to the M. D D patient population and our.
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This impressive increase in patient interest in Neurostar provides our N P c's with the huge opportunity to prove out our value proposition and assist our customers and offering more patients hope for beating their depression with the neurostar treatment.
As noted on the fourth quarter call. We recently launched two exciting programs aimed at making sure that our customers are able to assist as many patients as possible.
The first program is the five stars to success.
Which is proven detailed in a prescriptive formula to improve a customer's neurostar practice.
The program, which is based on market research is designed to focus on the patient journey to the practice.
We want to ensure that from the initial expression of interest through the initial consultation to the decision to obtain treatment with neurostar that the patient does not get lost in the process of.
Approximately 30% of our accounts have begun the program and a large number of our accounts have already earned the first three stars in the five Star program.
The second program as of precision pulse, which is designed to partner with our customers to build awareness among M. D. D patient population about neurostar in their local areas.
We have seen strong early adoption by customers and we expect that as the year progresses, we will continue to see more customers participate.
At the beginning of April we hosted a quarterly regional sales meeting given the logistics of COVID-19 and the size of the team we decided to invite the entire sales team out of simplicity and efficiency as a result of this meeting we gained initial feedback on the five stars and precision pulse programs.
And the additional market insights from the team.
Based on the feedback we are confident that we are focused in the right areas and have the right team in place to execute our strategy.
We are very encouraged by the positive traction of our marketing and customer training efforts and we will continue to work to refine our strategy to drive increased awareness among M. D D patient population and help our customers identify and treat more patients.
Lastly, we made strides towards executing on our long term clinical and regulatory strategy.
Shortly after our fourth quarter call in March we named Cori Anderson, our new Vice President of clinical Affairs and medical operations.
We were very excited to bring on board and he has made an immediate impact on driving the clinical development of Neurostar in.
In its first 60 days Cory and his team have already opened of productive dialogue with the F. D. A to explore pathways to additional indications.
As previously announced in late Q4 of 2020, we received FDA clearance for our touch start treatment a three minute treatment protocol used with our Neurostar advanced therapy system.
The software update is available at no charge to our entire installed base and all new systems shipped since February February have included the touch Star protocol. It is still early days, but we are working on a group working with the group of 20, leading kols and industry societies to determine the most of.
Appropriate utilization of this treatment protocol.
Overall, I am very proud of our performance in the first quarter and enthusiastic about how we of our position for the future.
Since I joined the company, we've accomplished all of the key milestones that we set out to achieve the completion of the market Research study the development and introduction of a new commercial strategy the.
The expansion optimization and training of our commercial team.
The addition of key talent throughout the organization.
And progress towards the development of our clinical and regulatory strategy.
I am very pleased by our initial success as we continue the execution of our strategic shift to a patient focused company.
We believe that long term success in our industry requires much more than just selling a system to a physician.
Success requires a deep understanding of patients with depression and their journey to obtaining treatment beyond medications.
Success also requires a true partnership with our customers as the treat an increasing number of patients with neuro star.
Our partnership ensures that through our five stars to success program, our customers have access to the best practices. We have developed over the last 12 years to help practices reach patients with that I'll turn the call over to Steve.
Thank you Keith total revenue for the first quarter was $12 $3 million, an increase of 7% over first quarter 2020 revenue of $11 $5 million.
During the quarter total U S revenue increased by 6% and international revenue increased by 63% over the prior year quarter.
The U S revenue growth was driven by an increase in U S treatment session revenue and the international revenue growth was driven by an increase of Neurostar advanced therapy system sales.
U S Neurostar advanced therapy system revenue was $1.8 million.
Compared to the prior year revenue of $2 $6 million it was down 32%.
The decrease was primarily driven by lower Neurostar system sales in the quarter as the result of the launch of our new commercial organization during the quarter.
In the quarter the company sold 23 systems down from 38 in the first quarter of 2020.
U S treatment session revenue was $9 $6 million, an increase of 18% over first quarter 2020 revenue of $8 $2 million the.
The growth was primarily driven by an increase in park click treatment session volume over the prior year period.
In the first quarter of 2021 revenue per active site was approximately $10512 compared to approximately $9418 in the prior year quarter.
As a reminder, we calculate this metric by dividing total U S treatment session revenue by the beginning of quarter active sites.
Over time with some level of seasonality as we continue to execute on our commercial strategy you would expect this metric to increase.
Gross margin for the first quarter of 2021 was 81, 9% compared to the first quarter 2020 gross margin of 75, 5% the.
The increase was primarily a result of a change in the product mix compared to the prior year quarter.
Operating expenses during the quarter were $17 million, a decrease of $2 million or 11% compared to the first quarter of 2020.
The decrease was primarily due to lower head count and product development expenses compared to the prior year quarter.
During the quarter, we incurred approximately $2 2 million of non cash stock based compensation expenses, primarily related to the first quarter 2021 expansion of our commercial organization.
Net loss for the first quarter of 2021 was $7 $9 million or <unk> 31 per share as compared to a net loss of $12 $6 million or 68 per share during the first quarter of 2020.
EBITDA for the first quarter of 2021 was negative $6 $6 million as compared to negative $10 $8 million for the first quarter of 2020.
Moving to the balance sheet as of March 31st 2021, cash and cash equivalents were $121 $3 million, which included the $86 million in net proceeds raised through the closing of an underwritten public offering of common stock including.
<unk> the full exercise of the over allotment option during the first quarter.
Now turning to guidance for.
For the full year 2021, we now expect revenue in the range of $59 million to $63 million up from our previous guidance of $58 million to $62 million.
Our guidance assumes the COVID-19 headwinds subside and there are no major resurgence is in the U S debt impact our customers or patients.
In addition, we expect that our newly hired BD and an N. P. CS will begin to have a modest positive impact on revenue in the second quarter.
Moving into the second half of the year, you would expect their contribution to increase as the gain experience and progress towards full productivity for.
The second quarter of 2021, we expect revenue in the range of $14 million to $15 million.
The company now projects total operating expenses for the full year 2021 to be in the range of $64 million to $68 million.
The increase in operating expense guidance is primarily as a result of increased.
Noncash stock based compensation expenses, which for the full year, we expect to be approximately $8 million.
In line with the strategy, we outlined when we raise capital earlier. This year, we are evaluating additional investments in sales and marketing product development and indication expansion during the year to support and accelerate top line growth I would now like to turn the call back over to Keith.
Thanks, Steve.
Turning to our expectations for the remainder of 2021, we will continue to be focused on building awareness and motivating patients with depression to requesting eurostar.
And training our customers on the best practices to educate patients who are searching for an alternative to drugs on the benefits of Neurostar, specifically, we will work to optimize our digital and social media campaigns expand our concierge call Center efforts launched new customer programs and.
Continue to put the pieces in place to execute on our clinical and regulatory strategy.
Now more than ever ever as a leader in this space Neuro networks is best positioned to partner with psychiatrist to treat depression we.
We have over 1200 installed neurostar systems globally.
Our set of published clinical studies on Tms and depression surpasses all others. We built a strong understanding of how patients are treated through our outcomes registry, which is the largest registry covering patients with depression.
We also have the largest and most comprehensive field based commercial team.
That is incentivized to help physicians improve access to care and offer more M. D D patients relief from their depression.
The team includes Npcs, BD EMS reimbursement specialists and clinical trainers and we are the only company to offer unlimited clinical training as part of our partnership.
We understand that treaters change patients are unique and clinical training whenever and wherever it's needed it's critical to positive patient outcomes.
We remain very enthusiastic about the massive opportunity that lies ahead of neuro networks. Despite being in the early innings, we have seen very encouraging success with the introduction of our new commercial strategy.
As our BD EMS and Npcs have more time in the field and as we successfully implement education and training programs within our greater population of our customer base. We expect to continue to see the positive impact of these initiatives accelerate throughout the year.
We look forward to our continued execution as we look to bring the benefits of Neurostar advanced therapy for mental health to all patients suffering from drug resistant depression.
I'd now like to open the line for questions.
As a reminder, task of quest, you will need to press star one on your telephone.
All of your question price of the mountain please.
Please standby, while we compile the Q&A roster.
Our first question comes from the line of Margaret Tactically some day.
Your line is now open.
Hey, good morning, everyone and thanks for taking the question.
Yeah, so paying of math person I can't help but try to do the math on the 3000 treatment sessions per day that you guys suggested you saw in April.
But do that math of the kind of gets 180 to 270000 treatments, depending on where you whether you kind of weekends or not so.
Maybe walk me through why we should or shouldn't be doing that math.
And then should we continue to see that number continue to ramp higher throughout the year, giving them the sales and marketing initiatives that you guys are continuing to watch.
<unk>.
Thanks, Margaret This is Steve Yeah, actually the math works and so.
This.
It certainly hasn't plateaued and we do expect that number to continue to increase as the programs. We've rolled out continue to gain traction and so we look at it. If you look at 3000 treatments per day of 240 working days times.
The $65 ASP. It gets you pretty close to $50 million at that rate and annual treatment session revenue.
Obviously, we our expectations are higher than that but you know coming out of the pandemic and getting to that 3000 number in Q1 were very excited about the rest of the year.
Okay.
So that's quite positive net pushing a little bit I'm the.
180 to $2 seven day at Youre, assuming just kind of weekday weekend right. So.
That's fair to 40.
We're just assuming Monday through Friday.
Okay, and then if we start to think about some of the.
Yeah that treatment side accelerating how aggressive are you guys kind of try to be to try to put of secondary system purchase in some of these accounts, what's the right level of write points at which you want to do that versus just adding more new accounts.
Yeah.
The term of aggressive makes it sound like for pushing our customers to take systems on our behalf.
But with the scheduling quirks of of.
M D D.
I think once a customer gets to five or six patients per day. It really does necessitate that need for a second system and so you know again with the real time insight that we have via the track Star, We know where our customer is at any specific point in time, and it's really at that point once they start doing for.
The five that the Npcs, we'll start looking at their workflow and scheduling.
Parks, and then either recommend or not recommend that second system. So it'll be a balance between new customers and second system sales into.
Our existing installed base.
Okay and then just.
Last question for me you know as we look at that guidance and in which he said just now about treat for revenues and the potential secondary you didnt placements or at least the man, let's say in some of these accounts that are seeing a rebound.
Why shouldn't we assume a bigger impact I guess from the new BMS you've hired in the second quarter and how should we think about kind of that evolution as we go towards the second half in terms of productivity. Thanks guys.
All of them. So yes, as we've communicated our plan and guidance is somewhat back end loaded I think in fairness to Keith and myself and the commercial team, we have a little more than two and a half months under our belt and getting experience with their forecasting capabilities and also with them having.
The rebuilds.
Their sales funnel I think coming out of Q1, we're very pleased with the performance in Q1.
And also where they are relative to new opportunities.
Again, I think we'll be able to get more aggressive once we work through Q2, and really get a better understanding of the cadence of the team.
Before we really go out and start aggressively pushing guidance and the full year forecast. So again, what we saw to date, we're very pleased and we do expect that productivity to continue to increase.
In the second quarter and also throughout the second half of the year.
Great. Thanks, guys.
Thank you Margaret.
Yeah.
Thank you. Our next question comes from the line of Marie Thibault from <unk>. Your line is now thing.
Okay.
Alright.
<unk> is now open.
Apologize I was on mute thanks for taking the questions.
I wanted to ask a question maybe for Keith here on Rep productivity and whether you know the.
New.
You know mediums in Mpc's you hired.
Later this year are progressing as hoped I know that you had expected those folks to be.
Productive quite quickly so would love to just kind of get kind of a qualitative understanding of how their progress is going.
Good Thanks Marie.
On the on the capital side, the the BD EMS I think we're exactly on track of where we expect it to be they are.
Again.
Didn't get into the field until February 1st as a result of.
Two and a half weeks of training and then our national sales meeting.
Once they did get into the field, we were quite pleased with the number of opportunities that they were creating in our dynamics database system.
Yeah.
Think for a capital rep to sit down and type of a <unk>.
Opportunity in and all of the data that needs to go into is to create that opportunity. It was impressive that we've got several hundred of them. So we're pleased with with where we are on the capital side on the MPC side.
We rolled out.
Two programs two major programs to them and I think they've done hero's work to bring those to all of their accounts, what we learned early on was a.
Most of our accounts need to start at the very beginning of our five stars to success program and so when MPC has 35 of accounts that they need to train they have to.
Hustle to get around to all of them to deliver quality training to each one of their staff. So again, we were able to get 90 of our accounts to the three star level, which is the minimum requirement to participate in our call center and we.
I found it amazing that our Mpc's, we're able to get 90 of them.
At that level. So we're pleased with productivity on both sides of the ball.
Okay. That's great to hear and then maybe looking ahead, you mentioned work on new indications.
Can you give the sort of an update on what indications here of circling and then we know that reimbursement is obviously important to commercialization there so how youre thinking about the reimbursement progress.
Yeah.
So I honestly Marie I would I will tell you that we are looking at speaking to the F. D. A about two indications that I would rather not discuss those publicly at this moment. We are we are in discussions with the FDA and we have an upcoming meeting with them.
So once that is concluded I can give more information on it but we and we are also we have hired a regulatory consultant to help with with our I'm sorry of reimbursement consultant to help with our reimbursement strategy around those two IND.
Locations.
So I think.
As.
As we progress with the FDA and we see what direction, we're going to be able to go we will be able to deploy this this consultant to help us create the plan.
Okay.
And one last one probably just for housekeeping item, maybe Steve can help with.
916 active sites at the end of last quarter to start Q1 could you give us the number for where you ended.
At the end of Q1.
Sure It was 900.
So slightly down and so we continue to monitor the practices that are either embracing telehealth have permanently closed.
Or are in a different state of transition. So we really weren't surprised by that number.
Also it was the one year anniversary one year anniversary of the beginning of COVID-19 and the way we identify active.
They had two of either purchased or treated the patient in the past year.
And so a number of sites had dropped off based on that definition and so again, there's about 50 sites that are.
Still on cash.
All of health that are of practice consultants are working with to get them back.
So theyre treating patients once again.
Okay. So you would expect that number debt to climb throughout the year then.
Yes Yep.
Alright, perfect. Thank you.
Thank you.
Thank you. Our next question comes from the line of sales.
Revenue from Canaccord. Your line is now open.
Great. Thanks, good morning.
Just a couple of questions for me. The first is really related to the new marketing programs, you've put in place and just trying to understand you know it seems like the engagement has picked up.
Especially in the targeted areas, but it just you know.
In terms of the metrics you look at new plan on sharing in the future.
Just wondering if we're going to get any granularity on the.
The conversion of those appointments that youre seeing going in into patients and that kind of ties into one of my other questions I've just running the math it looks like the patients.
In the first quarter.
Down versus the fourth quarter, but just wanted to get clarity on that as well.
Yeah.
Yeah, I mean, we have I would say of pretty impressive metric debt.
We don't share it.
But we do track.
You know utilization by site by per day.
I mean, our utilization is up over 55% compared to 19, our MTS, which is indicative of new patient starts are up significantly over 2019, and 2020, I guess I'm not sure what youre looking at that would indicate.
We had the patient decline from Q4 to Q1.
Obviously Q1 is always our lightest quarter, just due to the reset of medical plans and deductibles and so we do see of decline.
Historically, but I mean 9.8 in treatment session revenue, we thought that was phenomenal and we also had a number of days lost due to weather.
We have a number of our service providers I'm very dance in both Chicago, and Texas and they lost multiple trading days, so that number could have been easily north of 10 in the half and so.
Again, we're extremely pleased with all of the data we're looking at them and continue to be excited about the rollout of these marketing programs I will say is that the npcs worked through the month of March.
There was a great uptick in the last couple of weeks when our customers really get a better understanding of the programs how they work and what the benefits were.
And we had a number of I would say very impressive orders.
At the end of the end of March and those of continued through February through April.
So again everything that we're monitoring here internally is extremely positive.
Great and then thank you and then on the.
The accounts that are joining the call center.
It looks like you have about 10% of your treatment sites are on there at this point.
This is something that you would get to a 100% over time or is this targeting more of the high volume and if so kind of when do you expect to achieve that penetration rate.
I'm not sure we can ever get to a 100% honestly bill.
Thank you.
Some accounts.
Arent going to want to participate in it but I think our goal is to get as many as possible onto it we want to go through all five stars with the with every accounts. So the first three is really focused around getting great clinical results getting their office set up to.
To receive the patience understanding reimbursement and then doing internal marketing with with their patients and counseling.
Both of their front desk staff as well as there.
Their counselors on how to talk to these patients. So I think as many accounts as our willing we'll get at least those first three steps.
Our goal is to get 100% of them, whether they let us or not is unclear, but I think as as we gain.
Traction in the field I think we'll get more and more accounts grew.
Right.
And then the last question for me just is.
Just the initial feedback.
With the program now that you've implemented it from the initial marketing any changes or major changes or even small minor tweaks of note that we should think about as you continue to deploy these programs and that's all I have thank you.
So I think from the overall design of the programs both the five starts to success and the the.
Precision pulse I think the foundation of those programs of solid and we have no plans on altering the after looking at what's going on in the field for the last 10 weeks.
I think our marketing messaging and look and feel will always continue to evolve and.
We're in the process of introducing a new website in the next couple of months, where we're talking to agencies about.
About new creative so all of those things will continue to be fluid and.
Being guided by our marketing research so no no major structural changes at all and I think the our patient journey has turned out to be a home run for us I think it resonates with accounts.
The when we we speak to the accounts and we point out opportunities for training they are very receptive to it.
Great. Congratulations on the thank you very much thanks Bill.
Thank you. Our next question comes from the line of Matthew O'brien from Piper Sandler Your line is now from.
Thanks, Good morning, and thanks for taking the questions.
Keith or Steve just for starters on the on the capital side of things I mean that was the only one number out of everything that was a little bit lighter than I'm sure. Some people were modeling us included the sensor.
The number was great. So basically you had this group.
Out of the field for a month for the 23, if you just annualized would've been maybe closer to the mid thirties and then you also took the the price up I guess the first part is that 35 ish number about right just the price up it looks like as well is that something that's durable and then just the kind of round out this question.
Are you seeing anything competitively that should be pointed out from brain's way or.
Neither of the Mag companies.
The debt potentially could have weighed on the number of capital placements that you had in Q1.
Thanks, Matt.
Yeah, I mean, you can just.
Extrapolate the the 23 to the mid Thirty's, if the team was out in the field for the full quarter.
I will say we were.
Pleased with the number of opportunities that were created.
I think <unk>.
<unk> of the team realized that the selling cycle into psychiatrist is longer.
Then I think they were used to but again, if it's just the timing issue that's fine and our expectations for Q2 or are much higher than we saw in Q1, and so you know.
In fairness to the BD team.
They really only had less than 10 weeks to transact coming right out of the gate. So.
The number they put up was pretty impressive from an ASP perspective.
The other the compensation plans this year.
Do incent, the Bds to sell it at higher pricing thresholds and so yeah, we do expect that ASP to hold and really the the only variable with the capital equipment Asps will be the mix of the sales type leases into the green books and successes of the world.
Versus the traditional capital sales at the Bds South So I think we mentioned on the fourth quarter call. We actually had systems transacted at list price.
But overall the the asps have been higher in the first quarter.
Competitively.
We're not really seeing anything different.
There's still 56000 and psychiatrist.
But the mags and brain's way, they do pop up here and there, but again our value proposition and the partnerships that we provide to our customers really sets us apart and you could see that in the uptick.
And the the marketing programs that the customer signing on.
And we do make it very attractive right now for customers to purchase the second or a third system. So.
We're going to keep doing what we're doing obviously the market leader best in class. So that should continue to set us apart.
Got it and then the follow up questions on the 3000 patients per day comment.
Steve you got a lot of metrics in front of you I don't know how much you want to share, but can you just talk a little bit more about the dynamics around that.
Backlog moving from for drugs down to two of making it easier to to start on Neurostar COVID-19 the.
Tailwind as people are more depressed or recurring customers just any more color that you can provide on that because that's a pretty marked increase in really.
Something for the remainder of the year as far as the euro.
The recession business goes.
Some of that our treatment sessions have steadily increased over over the last several months and I think quite honestly I think there may be some some tailwind with COVID-19, but we really didn't expect those patients to come into the pipeline until they failed the two.
The four drugs, which would put them at the end of this year of the beginning of next year. So I think quite honestly I am going the credit our marketing programs driving awareness and our Npcs and the field is doing their jobs and teaching accounts how to speak the patients about the bench.
The fits of the Neurostar treatment.
Okay. So it is still.
This feels like a more durable level, Keith and then building from here is that fair.
The encouraging piece to US is we don't see a jump it's been a steady.
Increase in utilization.
Since COVID-19 since really the middle of last year, it's been steadily increasing.
Got it thank you.
Thank you Pat.
Okay.
Thank you. Our next question comes from the line of day.
The late from JMP Securities. Your line is now open.
Great Good morning.
Maybe one of them.
For you because I think I think I'm hearing the sort of the shift in the organization I just want to confirm it so.
You have this.
Patient focus.
The new commercial organization.
That seems to be the kind of the push going forward.
Sometimes in the past I think we were looking more at the product features like <unk> like the ones on slide 19 of your of your.
Dirk.
And maybe further indications.
But it seems like that's the this is the shift but I'd just like to get your thoughts I mean, it seems like this is your explicit goal to move the company in this direction.
Just like the <unk>.
Can you maybe explain why you think that's so important.
I think theres a theres two things day one is.
A small number of of psychiatrist and neurologist are doing.
Tms.
And so there's a massive opportunity out there to educate those physicians on the benefits of it those same physicians are writing a record number of prescriptions for anti depressants.
And so if we can focus our sales organization on.
Talking to physicians on how to speak to patients suffering with M. D. D. I think we when we are certainly focusing the inside organization.
Through Corey and Fred.
Of our head of regulatory.
On how we can advance the ball in the number of.
Of treatments, we can offer to physicians, but right now I think the the.
The depression market is still underserved and is still massive and it's only growing as the patients that are that exhibited depression in.
And COVID-19 times get to the two to four failed drug stage. So.
We have runway here that is is enormous and so we're focusing our outside team on that opportunity.
And I guess, it's just a quick follow up to one of the ones. I was asked earlier you know you look at the.
Six or so competitors it doesn't seem to me like any of them are focused in this arena.
Yes, sure from 17 that shows sort of of the differences, but the.
Do you think that's the sustainable.
Differentiated advantage for for the.
Net ex moving ahead.
I think we're the only ones the care, whether those doctors are successful or not.
We have of treatment session price debt.
Debt, we're proud of because that ties directly to the success of the company to the success of the practice and if if we can when we go into an account we talk to them about generating one patient per month per per practice and.
That's all of that one per month is the $100000 in revenue.
To that account, we're the only ones the care.
Whether that account is successful or not.
Thank you I appreciate it.
Thank you at this time I am showing no further questions I would like to turn the call back over to Keith Sullivan for closing remarks.
Thank you operator, and thank you again for joining us on the call today I look forward to updating you on the progress next quarterly call and I hope you're safe. Thank you.
Yeah.
This concludes the conference call. Thank you for participating you may now disconnect.
Okay.
Yes.
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