Q2 2021 Antares Pharma Inc Earnings Call
Yes.
And our partner doors, yet announced the initiate the global phase III study for collateral that utilizes our <unk> auto injector as a heart attack rescue pen.
Furthermore, we still look forward to pfizer's pending NDA submission for an undisclosed asset and the second half of this year.
Collectively we believe that the advancement of our proprietary pipeline in tandem with our partners development programs will support our strong growth trajectory.
In other words, we believe the diversification of our business support the foundation from which we will continue to grow.
Now, let me hand, the call over to Joe to provide an overview of our commercial achievements and strategy for continued growth for our proprietary products Joe.
Thanks, Bob and good morning, everyone I appreciate the opportunity to join today's call.
And I start by highlighting the I believe the success. The commercial organization has achieved thus far with zions debt is impressive.
Particularly given the limitations during the pandemic, but more importantly, I believe there is still considerable growth to be garnered which is 1 of the main reasons why I joined the company and.
And since joining Antares and May I've had the opportunity to engage with quite a few of our different customers as I travel out to 10 different markets across the United States and I have met with over 25 different health care providers, including some of our urologists endocrinologists and even some of our general practitioners and really.
The goal with the.
The better understand their perspectives as well as the perspectives of our field team members and.
And the physician feedback has been consistent many of our prescribers believe that size debt is the best testosterone replacement therapy on the market with approximately 9300 physicians and the top decile of already written Zeiss debt, which you can see on slide 5 we remain.
And focused on further penetrating their prescribing behavior as they see new patients coming into their office as well as continuing to drive switches, which has really been of key components of our growth at the height of the physician office closures.
And the second quarter Zeiss debt total prescriptions increased over 50% year over year as well as 15% sequentially and in fact June was our highest script month to date and July is tracking really strong <unk>.
Physicians offices have opened up more broadly we have been seeing more strength and new prescriptions and are currently drawing and approximate 50.50 split between new patients and switches.
Our growing refill rate has also highlights the strong persistence with our brand.
I've really been impressed with the motivation from our field sales team and they have been excited to get back and a physician's offices more fully this year with and expanded bag, but still with a primary dedication on <unk> debt.
We are currently able to make approximately 70% of our calls and person and the remaining 30% virtually with that said we are monitoring any new developments that may arise from the Delta variant and we are really prepared to access our customers and whatever approach is best for their practice.
We believe that hybrid model will persist and we have found success and both in person calls as well as our virtual calls with our customers.
When you look at the total testosterone market. It really remains compelling from a size and growth perspective, and we believes the ice had represented an effective therapy for at home use we expect.
To continue to grow our market share with more switches from painful Im injections and addition to those new to therapy.
And support we have new branded consumer and HCP digital campaigns that are targeted and health care professionals and consumers through platforms, such as Facebook and Instagram Netscape and read it and it's really to drive awareness from both the providers and the consumers.
Our field team is also working with updated interactive digital AIDS that really highlight key features such as the steady PK and with our virtually painless auto injector that we believe will further enhance the growth as I said.
Another element, we believe will help sustain and really bolster our growth and the proprietary portfolio is the recent expansion of our field team. We went from 79 Representatives to 85, and we expect that additional territories will provide us with more reach and targeting and some new markets.
And all of those I said remains the primary detailing focus for all of our representatives as I. Just mentioned, we also remain dedicated to the opportunity to grow doctor.
And the customer feedback has also been very positive for nocturnal and we believe physician education remains a key component to driving growth for this product, which now brings us to slide 6.
We recently launched new branded peer to peer educational speaker programs across the United States.
And with some of our key opinion leaders, who are experts and treating patients who struggle with non <unk> and that we believe will further educate health care providers.
And after I'll call urea effects of approximately 88% of the nocturia of patients and it's important that we help physicians differentiate the cause of frequent nighttime urination from benign prostate hyperplasia and or overactive bladder.
We also created branded consumer and HCP digital campaigns targeted at health care professionals and consumers and we place those on similar platforms as we did revise that and.
In addition, new sales and marketing tools will enable the field team is really to better describe the patient types that may be suitable for nocturnal and the physician's offices.
Internally, we have generated better territory and sites, we've dedicated more focus to targeting strategies and we've really enhanced the incentive compensation for our field team.
Overall, we are adding new doctrine of knockdown of targets and writers every week and after and our remains consistent with our expectations and this first year of launch.
Based on what we've learned we expect our marketing initiatives and of normal sales cycle really to enhance this opportunity.
So to wrap it up as we enter the back half of the year, we expect to continue to execute on all cylinders and believe our commercial strategy for Zeiss debt and Doctor and will continue to drive revenue growth.
And as we look out further we believe we have and extremely successful commercial organization that is excited to leverage their physician relationships with this enhanced bag.
We've established the vision, it's really built around creating high performing teams that demonstrate excellence and business management.
And with exceptional professional and scientific acumen, and 1 that really fosters a culture of collaboration and innovation, which we really believe will ultimately drive the performance of our brands.
And with that I'm going to hand, the call over now to Dr. Peter Richardson Peter.
Thank you Joe and good morning, everyone.
First and foremost, let me start by saying the I'm delighted to be parts of downtown of his team and I very much look forward to continue to develop and hopefully enhance the completeness of proprietary development pipeline along with the experienced team here of a ton tonnages.
Based on my background as the drug developer and clinician and privilege the help of tons. So I'll lead internal product candidates <unk> 19 of the Wong and <unk> 19 of 2 towards addressing the unmet needs of patients.
And the second quarter and as we promised we filed with the investigational new drug application for Atms 19 of 2 for acute adrenal crisis rescue which has been accepted by the FDA.
The other anti application for 19 O..2 supports the proposed indication for the treatment of acute adrenal and sufficiency known as the adrenal crisis and adults and adolescence using a novel the country auto injector, we have developed to deliver the liquid stable formulation of hydrocortisone, which brings us the slot.
7.
The background the <unk> as the potentially fatal condition.
<unk> from the acute deficiency of cortisol.
And normally produced and released by the adrenal gland and response to stress such as infection injury surgery, even anxiety.
This occurs in patients with long term adrenal sufficiency from conditions, such as obviously in the disease.
The covenant standard of care for adrenal crisis rescue is and the administration of Hydrocortisone, which is personally provided and the sterno powder that needs to be reconstituted with water for injection and then John for the needle the intravenous intramuscular injection.
We think this represents the time consuming and cumbersome injection process characterized as having multiple steps.
All of which could prove extremely challenging when and crisis.
Great. Thank you know too we've developed a new technology platform, which if successful will deliver a liquid formulation of hydrocortisone stable at room temperature.
And our development program aims to provide a reliable.
Ictu's to spec the injection process for this patient population.
As the leader in rescue pens, and Tommy's remains dedicated to providing reliable and robust simple and portable solutions for medical emergencies.
The results from the formal human factor study that was recently completed by an independent U S. Based specialist group and confirmed the ease of use and the administration of 18 of this 19 O 2 and the hands of the patients all Jacob.
We conducted the usability study to assess juice with untrained uses of our novel auto injector platform as well as to explore the potential improvements.
We expect to conduct and additional human factor studies to provide eventual submission of an NDA next year all following confirmation of the appropriate pharmacokinetic profile and our planned studies.
And this human factor study 18 subjects participated during which they use to delivery systems to administer the medication and the stimulated to the emergency.
The and tonnage strict delivery system is comprised of and also inject to containing the fecal syringe with medication and the comparator slowly quarter considered standard of care. This designed it and its currently market full of the dual chamber violence range, which was used to reconstitute and inject the medication.
Those will fall fewer user errors observed when participants use of auto injector the wind the use the bile needle and syringe.
And now Shining 17 out of 18 participants successfully gave stimulated full doses of medication when using out of ultra injector, while only 1 participant did so successfully when using the versant product <unk>.
Needless to say, while this initial human factor study only vps of piece of the overall development program. We're very pleased for these positive results that confirm unexpected <unk> for the potential ease of use of our auto injector system.
Liver and essential therapy at the time of stress.
And now with the <unk>, we can initiate the first PK studies confirm the pharmacokinetics of the formulation and the coming weeks and if successful. The second study will be conducted using a final auto injector combination product.
As we noticed.
These 2 studies along with the human factor study and expect to the successful to be the basis of and anticipated NDA filing with the FDA by the end of 2022.
We understand the urgency to advance this asset which will not only address the clear patient need but also expand our proprietary product offering within our developing and technology franchise.
Let me also mentioned <unk> 19 of the 1 which is the weekly formulation of an ultra of inject to administer the product and the year ago oncology and we will be pursuing the fiber the <unk> pathway for all of this asset.
We remain on track to file the IND for 19, and 1 in the fourth quarter. This year and will announce any clinical trial initiation and accordingly, I look forward to share in greater detail and future calls.
And beyond these 2 assets, we will continue to explore other opportunities that will leverage on pharmaceutical and device technology expertise to expand the pipeline.
And with that I'll now hand, the call back over to Bob.
Thanks Peter.
Before I dive into our partner business I think it is important to reiterate our commitment to the development of our proprietary pipeline.
We believe our proprietary hydrocortisone less UTI and represents a large revenue opportunity for and targets based on the current patient population.
And the advancement of this and total development program, coupled with <unk> 19, and 1 will support our future growth trajectory within our therapeutic footprint.
With the commercial success, we continue to garner resigns day, we remain eager to leverage the commercial team, including with business development initiatives, which remain ongoing.
Okay.
Our enthusiasm for our proprietary business also carries over to our partner business, which leads me to <unk> generic epipen and slide number 8.
And as you can key tenet of total prescriptions increase of 153% year over year, and the captured 58% market share of the epipen market.
Kevin and success contributed to the doubling of our royalty revenue and the second quarter and we expect that of normal back to school season. This year will help maintain this growth.
The success of this product has been and part due to our ability to produce and provide a reliable supply of millions of devices to meet the increased demand due to <unk> market share gain and the associated demand around Covid vaccinations.
Yeah.
Our relationship with Teva also extends to generic for <unk> and generic Byetta, which remain key to growth opportunities pending FDA approval.
In addition, we are excited for Pfizer's NDA submission to the FDA for their undisclosed asset this year and note that it is lack of disclosure has not hampered and advancement.
We continue respect pfizer's wishes to keep the assay confidential, but also look forward to its potential contribution to our future growth.
I'm also pleased with the progress of our partnership with the doors and the initiation of the global Phase III trial for <unk>.
We are very excited to play an important role in this development program, which utilizes our quick shot of auto injectors.
The strong collaboration between our teams is a lot of doors you to achieve this important milestone for this novel combination product and approximately 18 months from the signing of our development agreements.
The opportunity of self inject the latter grow at the onset of symptoms from the suspected heart attack represents a compelling proposition for patients and we believe with <unk> came in to that innovation.
True revolutionary as well as transformational for and cars.
We look forward to continued support of doors. These clinical advancement of collateral with clinical supply during the trial.
I'll now hand, the call over to Fred for a detailed review of our financials Fred.
Thanks, Bob Good morning, everyone. We're very excited to report another record quarter with total revenue, increasing 39% over 2020, achieving $45 million and net income of $4.4 million or <unk> <unk> per share for the.
3 months ended June 30 of 2021.
We believe the diversification of our business remains of course strength and Antares and we expect the strong performance from both the zoster and <unk> generic epipen to persist and further supports our confidence to achieve our full year 2021 revenue guidance range of $175 million to $200 million.
Furthermore, as we continue to generate cash and we felt it was prudent to make the prepayment of $15 million on our term loan with Hercules, which reduced our principal loan amount and related interest expense.
So let me now provide a more detailed review of the financial results for the second quarter and 6 months ended June 30 of 2021, which brings us to slides 9 and 10.
Total revenue was $45 million for the 3 months ended June 32021, representing a 39% increase compared to $32.4 million.
From the same period and 2020.
For the 6 months ended June 32021, total revenue was $87.1 million, a 33% increase from $65.5 million for the comparable periods of 2020.
Sales of our proprietary product sales federal tracks of the nocturnal generated revenue of $19 million and $37.7 million for 3 and 6 months ended June 32021, compared to 14, 8% and $27.4 million for the same periods in 2020.
The 28% and 37% increase and proprietary product sales for the 3 and 6 months ended June 32021, compared to the same periods. In 2020 were principally attributable to continued growth in sales of sales debt.
Licensing and development revenue was 7.2% and $12.2 million for the 3 and 6 months ended June 32021, compared to 2.7% and for $4 million from comparable periods of 2020.
The increase and licensing and development revenue and 2021 was primarily the result of incremental development product maintenance activities with Teva and our other ongoing partner development projects.
Royalty revenue doubled to $9.9 million for 3 months ended June 32021 from $5 million for the same period of 2020 for the 6 months ended June 32021 royalty revenue was $17.9 million compared to $9.3 million for the same period of 2020.
During the quarter ended June 32021, the epipen market returned to pre pandemic levels and kind of achieved a 58% market share which accounted for the net increase and royalty revenue over 2020.
Our gross profit was 28, 5% and $54.2 million.
Representing gross margins of 63% and 61% for the second quarter and 6 months ended June 30 of 2021, compared to 19, 9% and $37.9 million or.
For 62% and 58% gross margin and the same periods of 2020.
The improvement in gross profit and margin were primarily attributable to the increases and as asset sales and that the royalty.
Research and development expenses were $4 and $6.7 million for the 3 and 6 months ended June 32021, compared to 2.4 and $5.4 million for comparable periods of 2020, the increase in R&D costs were due to progress and.
And our internal development programs <unk> 19 of 1 and 19, all too as Peter discussed previously we submitted the application with the FDA and June of this year for the initiation of a clinical study for HRS $19.2 for the.
Adrenal prices rescue.
Selling general and administrative expenses were 17, 7% and $35.3 million for 3 and 6 months ended June 30 of 2021 compared to 14, 4% and $30.9 million for the comparable periods in 2020.
The net increase in SG&A in 2021 was primarily due to an increase of sales and marketing expenses that had declined during the pandemic and incremental costs associated with nocturnal.
As the result of our strong financial and operational results.
We reported net income of $4.4 million or <unk> <unk> per basic and diluted.
Earnings per share for the second quarter of 2021, compared to $2.2 million or penny per basic and diluted earnings per share and the same period and 2020.
Net income was $8.2 million or <unk> per basic and diluted earnings per share for the 6 months ended June 32021, compared to a net loss of 200000 zero cents per basic and diluted earnings per share and the comparable period in 2020.
Finally, and turning to generate cash from operations of $8.4 million for the 6 months ended June 32021, as a result of our consistent cash generation and June of this year, we made of.
Prepayment of $15 million on our term loans of Hercules This prepayment and allowed us to reduce our principal loan balance of $25 million as well as same amount of approximately $1.2 million annually on interest expense as.
As of June 30 of 2021 after the Hercules payment our cash balance was $45.1 million.
I'll now turn the call back to Bob for closing remarks, Bob Thanks for Ed.
I'm extremely proud of what we continue to accomplish that and targets and our strong financial and operating results. This quarter continue to reflect the fact.
Our positive results and both operations and development shouldn't be surprised for anyone as we continue to map out our future and Inc.
And execute on all fronts.
We believe our key current primary growth drivers and <unk> and <unk> are still in early stages of their product lifecycle, and we will continue to support our growth trajectory.
We also believe and we are building a strong internal development pipeline and coupled with what our partners are accomplishing and they're of development programs. We believe we are poised for significant growth longer term and and the future.
As we look ahead, we look forward to the potential continued growth of <unk> and the successful launch year of knockdown of <unk>.
Continued growth of tablets, epipen, and assuming a normal back to school season.
Finally, the NDA submission this year for a potential FDA approval in 2022.
The U S approval and launch of generic Taro paratype by Teva.
The initiation of clinical programs for <unk> 19, or 2 hour adrenal crises rescue pen.
The IND submission for <unk> 19 of 1 this year.
The dorothy's patient enrollment and a phase III trial for the <unk> heart attack rescue pen and finally, new business Alliance and business development opportunities.
Again, thank you for your interest and operator, you can now open the lineup for questions.
Thank you and if you'd like to ask a question. Please signal by pressing star 1 on your telephone keypad, if there isn't the speaker phone. Please make sure. Your mute function is turned off the law your signal to reach our equipment again. This Darwin. The ask a question. Our first question comes from Greg Fraser with true Securities.
Good morning, guys. Thanks for taking the questions.
First on <unk> and how do you see the mix of the patients evolving from the current 50.50 split between new and switches.
And the pandemic headwinds abate.
Yes. Thanks, Greg This is Joe and I think if I heard your question correctly, you are asking about the how we're seeing the evolution of the split so we're still seeing about a 50.50 split between both the switches and the new and obviously with the physician offices that have been opening up we're obviously seeing new patients coming in which the.
Obviously, continuing to help our and our ex growth. So it's still about a 50.50 split though.
Yes, Okay give us sense for how much of the iam market itself injection versus the and HCP doing the injection.
Did you ask about the.
Could you repeat that question that the amount of how the growth is with the business of that what you asked.
And much of the.
Business is patients injecting themselves versus having a health care provider do it.
Oh Gotcha. So we're seeing more physicians are probably the seeming to be.
<unk> and the patients to rely on their own injection. So we don't see as many offices doing the injections of themselves because obviously the pandemic created the scenario where.
And the visit patients weren't able to do that so more patients were doing that on their own and Thats why we believe the auto injector is really of key.
Benefit for us because obviously with patients doing this the injection on their own it's very difficult and painful when they are doing and im injection versus using our auto injector. So we're definitely seeing that trend for patient self administering now.
Got it and Thats helpful. And then I was just I was wondering if you could comment maybe high level on the potential for applying your auto injector technology to more and CE.
The folks view of the <unk> collaboration is essentially the first of many and any color on that front would be helpful. Thank you.
Okay, Great I'll take that question, yes, we obviously think our auto injector and injected platforms are obviously very compatible with all of <unk>, where they may need of self injection product.
For a quick shot device and others are very simple to use it to set process and so I think as we as we continue to.
<unk> success with programs like of doors yet.
Programs like with Pfizer when it becomes undisclosed I think that'll.
Increase our ability to get additional and CES.
And our platforms I think that early on and our lifecycle of as the company.
And the United States annually, just wondering when you look at that opportunity how.
What is the incidence of crisis within the within that 140000, and I know, it's a bit early but are there any early views relative to what's out there currently on how this could be priced and and all of a couple of follow ups.
Hi, Peter.
I'll take the yeah.
Use of this and and patience with.
Adrenal insufficiency, and how often they run into the situation and the how to use it for the first thing is the the patient too is all maintenance hydrocortisone and what I have the state of of using to manage the disease should have 1 of these devices all the all sense of existing therapy available for use.
Home should they get into a situation, where the stressed either by injury and infection and unable to take on all the all therapy and all of the endocrine societies recommend that the should be available and.
And then die of deal situation of the patient never has to use of the device you really want to be able to prevent the how this available where.
Where the home or traveling.
Most patients will not use this every year.
Some patients will need to use on the docks and getting those numbers and exactly the the the principle here is that all patients who have adrenal insufficiency share that access to a way of administering hydrocortisone and and the cute situation and that should be done simply as possible.
Yeah, and it's on the market side, we believe the market is actually bigger than what it is today because the current rlds product is very cumbersome and I think that a large number a number of patients.
Don't really use it as an option for crises day typically will then just present themselves to the E. R and if they go into the journal crisis and so we believe that there is there is a much larger opportunity and and what the RV has currently darn and today.
And on top of the as far as your pricing question and we're going to look into that as we continue to develop the product and obviously pricing is always the function of the benefits that you're bringing into that patient population into the healthcare system and so as we gain more insight into how the product.
Actually performs and the hands of of patients.
From a user standpoint and show that the PK is is consistent with the standard of care will obviously look to the price. It at the traditional rescue Penn pricing, which is usually of premium too just the normal maintenance therapy. So overall.
And it's going to be priced well and it'll it'll give us a really nice opportunity from a from a commercial standpoint unimportance Lee we think it's a significant advancement and benefits of patients who suffer from.
Addison and and return of the prices necessarily the most important thing for us.
Okay, and then a couple of thoughts when would be first of all and generic epipen and few sort of go back and it looks like we're in a.
Suddenly of more normalized and.
The environment relative to 2020, if you go back to the 2019 trends you typically see of 3 Q bump.
From 2 Q, even though you're elevating into <unk> is still see of sequential increase into 3 Q. So should should we be expecting that.
Again for this year for generic Epipen.
Have a share of 58% where do you think that can top out.
And then the last 1 I will just sneak in here just any updated thoughts on timing for generic for tail. Thanks.
Sure and an epipen and tell.
That has been bumping around $55 and 60% market share.
Given the really depend on any given we eventually of function of whose patients are actually buying the device, whether or not they're going to be covered for myelin product or tavis, but clearly that was done a great job and increasing their market share over the past year.
As far as the market is concerned we expect.
A normal back to school seat and based on all of the news we're hearing everybody wants.
The children to go back to school and I think that.
It's important.
And obviously going back to school and they're going to have to be equipped with the or epipen and the schools are going to have to have that depends on hand, and case of anaphylactic shock with the case with peanut butter allergies and all these things and things like that.
So the only thing I would say is that.
The Delta Varian is and onion as a wildcard and all of this right and so right now and it appears that everyone's going back to school, but that obviously you could change.
If things get worse, but.
But we're expecting it to be normal and I think importantly, I think tethers market share and that $55 and 60%.
Market share of that hate the maintain net it'll be it'll be really strong quarter for for Kevin and for us and.
So we're looking forward to it and and and also just as and FYI. The first couple of weeks of July had been very strong and so we are seeing.
The trends fold out the way that.
And that we expect them to at this point.
And then on the final question on the other question of our per day up from the time of the standpoint.
Right of the ships are great and that's.
And we have our partnerships, we we benefit from their development of the benefit from their of success like you see with Abby.
The 1 major downside of partnerships as we don't control of the file we don't control of the disclosure of information and we don't control really the timing of launches and so forth and that's where we are with for Teo for tale type of.
Still expecting the approval of retail.
We don't we're waiting for the approval just like everyone else is.
And hopefully they will get and across across the goal line shortly and that's the only information we have we're in the same camp as everybody else.
With our partner and they're waiting for the approval from the FDA. So that's the only update.
It's a meaningful product and continues to do really well and the marketplace and type of continues to have.
Prior to review and the refers to file so that garners tremendous commercial.
Of benefit once the once the price approved.
Thank you.
Thank you and our next question comes from David himself with my per Sandler.
Hey, Thanks, so on and I said and I apologize if I if I Miss the would you just go through the.
The the switch or a mix of what I mean by that is.
These days what portion of the switches are coming from I am versus the.
Bills and as the pandemic and.
Eases belt.
Built the Covid notwithstanding how do you expect that switch or mix.
The shift if at all.
That's number 1 and then secondly.
I have a question on the trucks and I know you don't get a lot of questions on that but you know you.
You you're you don't have a.
A broader rheumatologist business per se. So can you talk about the overall set of of trucks of within the organization do you want to add.
More rheumatology focused assets, where you can leverage that sales infrastructure or is that an asset the the 10th.
Really you could climb to take her for down the road. Thanks.
Alright. Thanks, David This is Joe I'll take the first question with regards to the switch mix. So I think what you are asking as we kind of go forward post pandemic, the we see that changing 1 way or the other.
And we anticipate that obviously and most of our switches for your question I think also with most of our switches are definitely coming from I am injections. We are getting obviously patients that were using either of the gels and not satisfied with that.
But what we're really anticipating is that we'll see more switches that's going to be our goal as well because as more of physicians get exposed to that as you saw we've got over 9000 that of that of used it as more physicians get exposed and is more patient and see the benefit of the diet that we definitely anticipate that switch will continue but that's.
Obviously with the market continuing to be really strong. We're also anticipating getting new patients as well. So we continue to see that mix to be an important part of the of the brand strategy going forward and and I don't think and we don't think necessarily that post pandemic that we're going to see a big ship, 1 way or the other except that I.
Daily Kos pandemic as we saw early on and we will see new patients coming into the market.
So that's that's the 1 thing that we would anticipate the continued app and as well.
So I don't know if you want to take the of the trucks.
Sure on the on the 8 tracks and of question David.
And clearly, it's not core to our therapeutic presence and endocrinology neurology and and some primary care and.
And on the market for 7 years, it's a very small percentage of our sales team time listening and probably 10%, but it continues to do well.
It hasn't and it is not growing excessively, but it's also not really going down either so it's a nice asset and our bag longer term I think are with you look at our development pipeline with 19 O 2 which is for.
For adrenal crisis endocrinology product. If you look at 19 O..1 that's a urology asset base to fit perfectly within where we are today from of therapeutic standpoint, and we're going to look to continue to expand net so longer term.
And tracks up.
And the right hands could do really well for us for another company and so we'll explore other options with those trucks of but right now and it continues to add to our bottom line and will continue to detail, but longer term obviously we are.
Looking at other options for Otrexup. So that we can focus on the endocrinology urology space as we continue to build that pipeline and and improve not only on a pipeline, but also improve the penetration of of zeiss debt as well as in up there and Ah So I think that.
That's basically where we're going to be going with the next couple of.
Years.
Okay for a couple of thanks guys.
Thank you. Our next question comes from Elliott will bear with Raymond James.
Thanks, Good morning.
Hi, guys may of Memphis, and you're prepared commentary, but can you just help me sort of reconcile of the continue the strong upward trajectory in Zaire of it.
R X's with revenue trends over the last Cup.
Couple of quarters, not sure I can necessarily put the pieces together, they're kind of given what we're seeing in terms of.
The Spence data.
Sure. If this was for him.
What we have several large payers.
And that we work with and 1 of the largest once we've worked with.
Was very late and they are billings to us.
And factor.
Fourth quarter and voice for rebates.
Occurred during the year year and closed and even.
Current during the first work was we didn't get it so close to the end of the second quarter and so of the same thing happened with the first quarter and and voice from that same payor. So we were 2 quarters out without having the updated and voices and when we took a look at the actual amounts of that came and versus the amounts of we had that we'd have accrued we were a little bit.
Short and each of the fourth quarter as well as the first quarter. So both of those small estimate of changes all hit and Q2 as a result, you see that the revenue increased did not match. The script increase that we saw from Q1 for cute too, but that was really and.
And we think it was a 1 time item that took place that were caught up with now.
No no and the the entire cumulative.
Sorry about go ahead and.
As much as you know as payers really depends on the patient mix.
It happened to be a couple of quarters, where this particular payor add a large number of patients unusual and.
And it just.
And that can change at any given quarter and the next changes whether it's 1 of the other major pbms or and any of the other plans and so.
And that's why you see a larger increase and the and the scripts and you did and the.
And the revenue, but we expect that to normalize go forward.
Oh and it was cumulative all taken place and the second quarter.
Okay and again, just just from clear. So it was it was under accrual based on specific trends at 1.
Particular pay.
Per rather than just sort of of general assumption of mix on your part correct.
That's exactly right.
Okay.
And then.
Turning to the.
Hydrocortisone asset for 3 non deficiency.
Okay, and that's a relatively small prescriber base and can largely be covered with existing sales force assets, but maybe you can just talk about kind of out of high level of based on your early assessment sort of.
What you see is kind of the incremental call overlap.
With respect to the prescriber base for that asset and what you currently have and the market whether or not you think you can sort of cover of 100 per cent opportunity with the existing infrastructure.
Hi, so speed of just in terms of the the folks who look out for these patients tend to be specialists endocrinologists of group that we do deal with and it can be fairly well focus on like joke talk about the the specifics of how we envisage and and being able to medical.
Yeah, and thanks, though I think of good question and the good news is that the physician group. The endocrinologist as you know that we are and with today. So we built relationships with those customers today, we've got access to those customers today.
When you look at the courthouse market and should about the success 60000 CRX is so.
And so we definitely see and opportunity and as you heard and the and the descriptor to what patients have to do today compared to what day would do with our auto injector.
The huge we see that is a really great opportunity and something we are going to be bringing to the market that I think customers will really appreciate the obviously their patients will as well, but we've got pretty good access to that customer base today, and so we see that the real good marriage with what we have already and I think the only elements that we would potentially add on users a pediatric.
Consideration here, we're looking at our product for adolescents as well and so.
We looked at the essentially adding about it.
That it does and rats when the product is launched of focus exclusively on those pediatric endocrinologist because we obviously, we don't call and most of them for the ice age because most of the patients on testosterone and are older men are males from the 16 and up and so.
That's the 1 area that we may see.
The basically.
A larger number of an expansion of wraps, but of very but very modest relative to the overall size of the company.
Of the commercial team.
Okay.
And then I guess with just with respect to the.
The development path for that product any watch you could provide kind of of this early stage in terms of thinking about potential exclusivity avenues and also.
Requests for some sort of abbreviated approval pathway.
So.
And an orphan population and of.
Are we want to explore that opportunity with the FDA and we intend on doing net.
The good news is the commercial.
Assessment doesn't require of that too.
Be north and product, but obviously there is upside if we do get it and.
Until we meet with the agency.
And the the actual department within the agency that deals with orphan designations, we don't want to promise anything but.
But our goal of would be to get it to be orphan exclusive but as we move forward and we will give up further updates as we do things with you and add some Peter and also just to emphasize.
Developed a novel formulation here and.
Progressing with that too and this is also a new ultra injected platform.
And that's going out with different from others.
And I think both of those will be providing barriers to entry.
Okay.
And just 1 last question for the shelf, Bob just going back to my early commentary around the epinephrine marketplace for getting lots of questions.
Looking forward, a little bit and thinking about 2022 and continue to see these elevated levels of.
Epinephrine dispensing I know you've got a reasonably good and longer term look into the sort of how.
How your partner's expectations for that market may be shaping up but just sort of any high level of thoughts you may have in terms of the sort of the sustainability of kind of what has been sort of and above average.
A level of of utilization for epinephrine product. Thanks.
Yeah as far as the EPPY market going forward.
Obviously more and more of patients every year and the R.
Subject to Pee and allergies, and these things and things like that so I think the overall of the market continues to grow and I think to have and will continue to capture the market share that day been able to garner and potentially increase that night and it's not really what their initial goal is at 50 per cent of the market and the of obviously exceeded debt and so we're not looking for them too.
The take a tremendous amount of more and market share it just of interest.
And just.
And is normal market out there for for multiple products, including Marlins Epipen.
But as far as the pandemic is concerned.
Clearly been of lift on the units relative to the vaccines and we see the vaccines continuing into the balance of this year. The also believe that there could be booster shots that.
Again, we're not we're not experts zone COVID-19 and.
Pertaining to report the day, but.
I think that there will be booster shots and you're going to have the same potential issue with booster shots that should do with the.
With the current vaccines and so.
We believe it's sustainable it's not going to be of cliff, it's not like it's been.
2 and doubling of the market, it's been a nice benefit after a very terrible 2020 market because of the because of the of.
The cause of Covid so.
We think it will continue to be a very strong growth of.
Opportunity for us and have and and minimum.
It's got a very long value for both of us as we've seen as of very durable generic.
Thank you and our next question comes from Gregory Youre Danava with co and the company.
Hey, Thank you so much for taking our question and congratulations and all of the progress. So yes for some of that the just the Zip.
To some of the previous questions do you have any.
Any guidance.
And to give in terms of the net value per Rx that we should be expecting for the remainder of the year. You think it would kind of like continue to improve for room, what you saw on.
This quarter around 250 per Rx understanding those dynamics that you mentioned in terms of.
Really payments.
Sure of Georgia this the spread.
We do expect the the net selling price the increase in July of this year, we did take a small price increase for Zhao spent and also when you couple of and the factor that.
The.
Under estimate for for sales set for the fourth quarter actually all occurred and the first half of this year, we expect both of those to.
Normalize if you will and increase the net selling price as we look out through the rest of this year.
And the normal factors of reduced co pay support and you go further and the year also increases of next on the price of note dynamics haven't changed a lot of patients already through the deductible.
Either.
Very low or no co pay at this point and depending on.
And certain situations. So we typically see the co pays for a drop quarter over quarter and that we don't expect to see the change and then so that'll increase the net sales price of the product as we go into Q3 and Q for.
That's very helpful. Thank you and then.
The continuum that and.
How do you think this change and preference we're starting to see from physicians might be in the future.
As we hopefully exit the pandemic.
Levers can be pressed to achieve garner vast and awareness and adoption.
So I think you're asking about the potentially patient staying on therapy I think it's kind of of the question you're asking and.
And and as as we're actually seeing a really a nice growth and the length of therapy and fact, we're we're now seeing patients beginning to stay on therapy going towards 7 months. So.
It's showing a really great persistency for the brand, which obviously against speaks to the fact of patients are doing well on the brand. So that that's continue to grow and if you look at our and our ex growth, it's actually as strong as our tier ex growth. So it's it's definitely showing signs of that patients are not on the refilling, but are obviously continuing to give the patients on the brown.
Great and then I was kind of the question is on the <unk> because now the as you have a little more experience with the product where do you think your commercial team can improve on the prior and launch and what is your biggest impression from the initial patient and demand is there any clinician education expect.
And just in general what are the most crucial of aspect and the low hanging fruits to growing the product.
Yes. This is Joe again, thanks, so much for the question with Dr.
Mentioned and it's that's definitely what we see as of has been a critical element of that physician education component and as I mentioned and the opening comments and 1 of the things that we rolled out this year just actually about a month ago is key.
<unk> opinion later educational programs across the country, we see those as really being instrumental in helping physicians really identify these patients because with post pandemic what was coming into physicians offices. They were they were just literally trying to catch up so what we're finding is really being helpful to physicians and helping them really understand what are some.
Of the patient types that are in their practice today that might be kind of floating under the radar and these educational programs as well as the revised interactive visually and that actually gives the patient types that the physicians can look for received those 2 things as being really critical of the helping really continuing to grow opportunities with doctor.
This is great. Thank you so much.
Thank you for a final question will come from that Katherine with Ladenburg Thalmann.
Hi, Good morning, guys and that's on the the strong quarter Uhm wanted to dig into against the the 3 things first the Zionist and maybe a question for Joe with respect to.
How important are against in person.
Meetings with with doctors.
Given the success you've had during the pandemic really continue to grow and Ah Zion.
<unk> and what are you seeing out there now with the kind of resurgence of.
Of the.
And the Delta.
The version of the of the <unk>.
<unk> and your access the doctor's offices.
Yes, Thanks, Matt really good questions I would I.
And I would say that where the good news is we're continuing to see a physician and access to be good certainly posed pandemic as I mentioned, we're definitely monitoring obviously the delta variant, we haven't seen any substantial changes yet and the market from and acts of standpoint.
The 1 benefit silver lining we've had with the pandemic was we really develop the capability and.
Around the virtual call. So this team has really done well and the brand team is also the marketing team is also provided the team with resources that they can use and that virtual Fedex. So we still as I mentioned, we've got about 30% of our activity, it's still happening virtual so even if the physician's offices would get harder to access the virtual capability.
We've developed.
That that will continue to be able to garner the opportunities with that and doctor and Ah and and so that's something we're prepared for us. So we're really able now to me.
The customer wherever they need to of whether that be in person of virtual but to your question and certainly in person and we see is the ideal opportunity because there you can get into much of the deeper in the discussion with with the physicians as well as the staff members and things like that so we're going to continue the obviously tried to go towards per per.
And where we can but we're going to be ready for you too.
And 2 modifiers switch over to a virtual as we need to.
Okay. Okay. That's helpful. And then a question on 19 O 2.
Can you help us understand the kind of potential market dynamics. There I guess you you mentioned.
Guess that's more.
The most patients will not use their.
Rescue pen.
Frequently and then currently in and the market you mentioned off some of that most patients are.
And a significant number of patients going to the E. R to address the adrenal crisis.
I guess.
With respect to European and should we think of it more as kind of an epipen situation, where there's gonna be of certain shelf lives, where the need to refill the.
Penn's even there the unused over a period of time.
Yes, Hi, Peter you are absolutely right. This the model I think we should be thinking of is the of epic.
Epipen and were.
You don't want to have to use that you are trying to avoid that but when you need to have the.
The therapy, you want to be able to give it as simply as possible and it's gotta be available to the patient and where possible to any kind of give her and those situations where the about might be needed. So.
This is the classic use the rescue pen and his entire is is able to provide pens that meet the requirements for you and used and those acute situations and.
Capabilities of I think.
We have here and is.
Is 1 of the patients and physicians will appreciate.
And match your question about exploration of engaging it's going to be similar to epipen because of the day.
The.
A product that is probably going to have anywhere from 18 to 24 months of.
Stability and so the patients.
We'll have to replace those pens on a regular basis.
And obviously, the the ability to eat the.
And the expiration date and that you get for Epipen stars from when they start making the drug and so most patients even though and have your pants have expiration needing of 18 and 24 months depending on the.
The brand.
By the time, the patient actually gets it from the pharmacy and it usually has about 12 to 14 months of dating and so it wouldn't be that much different for our rescue pen for adrenal crisis, and so you wouldn't be able to provide the patient with the least 1 year of coverage and that's what our goal the overall and and.
So the the patients will replace them just like they do with saw the courts have wishes the RFP today.
Typically don't use it and you hope they don't need to use it but the when and when they need to it's there and and can save your life.
Right now that's that's very helpful. Thanks for that of the color.
Thank you and that concludes that question and answer session. This concludes today's presentation you may now disconnect.