Q3 2021 Agile Therapeutics Inc Earnings Call
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Good afternoon, and welcome to the agile Therapeutics third quarter 2021 financial results Conference call. Please note cities event is being recorded.
Operator: Good afternoon, and welcome to the Agile Therapeutics Third Quarter 2021 Financial Results Conference Call. Please note today's event is being recorded. I would now like to turn the conference over to Matt Riley, Head of Investor Relations.
I'd now like to turn the conference over to Matt Riley head of Investor Relations.
Hello, everyone and welcome to today's conference call to discuss our third quarter 2021 financial results and corporate update before.
Matthew Riley: Hello, everyone, and welcome to today's conference call to discuss our third quarter 2021 financial results and corporate updates. Before we start, let me remind you that today's call will include forward-looking statements based on current expectations, including statements concerning our financial outlook for the future, management's expectations for our future financial and operational performance, our business strategy, and our assessment of the combined hormonal contraceptive market and the potential market share for TORLA, among other statements regarding our plans, prospects, and expectations.
Before we start let me remind you that today's call will include forward looking statements based on current expectation.
<unk> statements concerning our financial outlook for the future management's expectations for our future financial and operational performance, our business strategy and our assessment of the combined hormonal contraceptive market and the potential market share for trust among other statements regarding our plans prospects and expectations.
Such statements represent our judgments as of today are not promises or guarantees and may involve risks and uncertainties that may cause actual results to differ from the results discussed in the forward looking statements.
Matthew Riley: Such statements represent our judgments of today, are not promises or guarantees, and may involve risks and uncertainties that may cause actual results to differ from those discussed in the forward-looking statements. Please refer to our filings with the SEC, which are available through the Investor Relations section of our website, for information concerning risk factors that may affect the company. We undertake no obligation to update forward-looking statements, except as required by law.
Please refer to our filings with the SEC, which are available through the Investor Relations section of our website for information concerning risk factors that may affect the company. We undertake no obligation to update forward looking statements, except as required by law. The information on today's call is not intended for promotional purposes and not sufficient for prescribing <unk>.
Matthew Riley: The information on today's call is not intended for promotional purposes and is not sufficient for prescribing this information. Joining me on today's call are Altomari, Agile Therapeutics Chairman and Chief Executive Officer, and Dennis Riley, Chief Financial Officer. Following our prepared remarks, we'll open the call to your questions. I will now turn the call over to Ash. Thank you very much, Matt.
Joining me on today's call are Al Tomorrow, Agile Therapeutics, Chairman and Chief Executive Officer, and Dennis Reilly Chief Financial Officer.
Following our prepared remarks, we'll open the call to your questions I will now turn the call over to al.
Thank you very much Matt and thank you all for joining us this afternoon.
Our third quarter 2021, we once again saw growth in all key performance areas Portola from.
Alfred F. Altomari: And thank you all for joining us this afternoon. In our third quarter, 2021, we once again saw growth in all key performance areas for TORILA. From the end of Quarter 2, 2021 to the end of Quarter 3, 2021, we saw the following: total cycles dispensed grew 61%. Total prescriptions for TREC. Proof 47%.
From the end of quarter, two 2021 to the end of quarter three 2021, we sold the following.
Total cycles dispense grew 61%.
Total prescriptions for <unk> grew 47%, new prescriptions or interactions grew 25%.
And rebuild.
Alfred F. Altomari: New Prescriptions, or Anorexis, grew 25%, and Refills grew 86%. We're encouraged by the double-digit growth in our prescription demand, but we are not content. Our goal is to accelerate the growth of the Turola brand and reduce our time to profitability. We believe we have the awareness and access programs in place to execute on our plans and intend to make meaningful investments in marketing to help increase demand. I'll delve into these initiatives later on this call, but first, let me discuss what we believe are the key takeaways from these performance metrics. First, refill growth at 86% is a great sign.
Grew 86%.
We're encouraged by the double digit growth in our prescription demand, but we are not content. Our goal is to accelerate the growth of Toro a brand and reduce our time to profitability.
We believe we have the awareness and access programs in place to execute on our plan and intend to make meaningful investments in marketing help increased demand.
Delve into these initiatives later on this call.
First let me discuss what we believe are the key takeaways on these performance metrics.
First refill growth at 86% is a great sign our head of marketing Amy Welsh always reminds us that we believe this is a sign of a healthy brand because it tells the women who own swirling liked orla and are staying on the product.
Alfred F. Altomari: Our Head of Marketing, Amy Welsh, always reminds us that this is a sign of a healthy brand because it tells us women are on Twirla, love Twirla, and are staying on the product. In turn, this gives us confidence and the longevity of the brand because new patient starts are translating to repeat customers. Second, we want to increase the rate of new prescription growth. When we consider the rate at which Torilla prescriptions are being refilled, we believe more new patient starts can lead to more refills and greater overall brand growth.
In turn this gives us the confidence and the longevity of the brand because new patient starts are translating to repeat customers.
Second we want to increase the rate of new prescription growth when we consider the rate at which toilet prescriptions are being rebuilt we believe more new patient starts can lead to more refills and greater overall brand growth.
Part of the new prescription equation is also the prescriber count.
The prescriber count grew 63% in the quarter to 3394 total prescribers and we continue to consistently pick up approximately 100, new prescribers each week.
Alfred F. Altomari: Part of the new prescription equation is also the prescriber. The prescriber count grew 63% in the quarter to 3,394 total prescribers, and we continue to consistently pick up approximately 100 new prescribers each week. Third, during quarter three, we said twirler cycles or retail units were expected to grow between 50 and 56 percent higher than the retail units sold in quarter two, 2021. We saw retail units actually grow at 61% this quarter.
Third during quarter, three we said 12 cycles or retail units were expected to grow between 50, and 56% higher than the retail units sold in quarter two 2021.
We saw retail units actually grow at 61% this quarter and again, we were pleased to see this growth but are not content, we want more.
Alfred F. Altomari: And again, we are pleased to see this growth but are not content. We want more. I'd also like to address the guidance provided during quarter three. During the third quarter, we said we expected third quarter 2021 net sales to be in the range of 1.4 to 1.6 million. We came in slightly under our guidance as wholesalers reduced their channel inventory by approximately eight days.
I'd like also to address the guidance provided during quarter three.
During the third quarter, we said, we expect the quarter three 2021 net sales to be in the range of one four to one 6 million we came in slightly under our guidance as wholesalers reduced their channel inventory by approximately eight days.
The double digit growth in prescription demand leads us to believe we have the underlying demand to support the business long term and we expect to see the wholesale activity reflect this in the near future Dennis.
Alfred F. Altomari: The double-digit growth in prescription demand leads us to believe we have the underlying demand to support the business long-term, and we expect to see the wholesale activity reflect this in the near future. Dennis will provide some additional commentary on revenues and inventory reserves for the quarter when I hand over the call to him. We need to accelerate prescription growth, which accelerates the revenue grant, and that is our singular focus. We're executing on initiatives that we believe can help accomplish this goal. For this call, I'd like to discuss three of these initiatives. Telehealth, Medi-Cal, and DTC in our Influencer Program. First Telehealth.
Dennis will provide some additional commentary on revenues and inventory reserves for the quarter, when I hand over to call to him.
We need to accelerate prescription growth, which accelerates the revenue grant and that is our singular focus.
We are executing on initiatives that we believe can help accomplish this goal.
This call I'd like to discuss three of these initiatives telehealth, Metical and DTC and our Influencer program.
First telehealth.
In the third quarter 2021, we announced the partnership with Panthea Health Telehealth service provider, which is now active.
Alfred F. Altomari: In the third quarter of 2021, we announced a partnership with Pandia Health, a telehealth service provider, which is now active. Pandia offers an additional point of access for Twirla in the fast-growing channel and represents the first telehealth alliance for our company and our product. We're excited to enter telehealth as it's used in contraceptive care, has grown over the past several years, and has come into the spotlight during the COVID-19 pandemic.
<unk> offers an additional point of access for <unk> and the fast growing channel and represents the first telehealth alliance for our company and our products.
We're excited to enter telehealth as it's used in the contraceptive care has grown over the past several years and have come into the spotlight during the COVID-19 pandemic.
We always believe telehealth with a priority channel for our target consumer prior to the pandemic and we believe that's even more so now to that end, we continue to explore additional telehealth partnership to maximize our footprint in this channel.
Alfred F. Altomari: We always believed telehealth was a priority channel for our target consumers prior to the pandemic, and we believe it's even more so now. To that end, we continue to explore additional telehealth partnerships to maximize our footprint in this channel. Because Twirla became available on Pays to Get at the very end of the third quarter, we expect to start seeing its contribution to our tier Xs as we progress through the fourth quarter of 2021 and into 2022. Second, Medi-Cal. As we previously announced, the California Medicaid program placed Twirla on the preferred drug formulary list effective October 1st, 2021.
Squirrel, it became available on Pythian at the very end of the third quarter, we expect to start seeing its contribution to our tier axis as we progressed through the fourth quarter of 2021 and into 2022.
Metical as.
As we previously announced the California Medicaid program placed <unk> on the preferred drug formulary list effective October one 2021.
This secured a preferred position for <unk> on the formulary for medical and its related program, which provides health care to approximately 15 million beneficiaries.
Alfred F. Altomari: This secured a preferred position for TORLA on the formulary for Medi-Cal and its related programs, which provide health care to approximately 15 million beneficiaries. This is significant for Squirrel Lit because Medi-Cal is the largest Medicaid program in the U.S. And we believe roughly one-third of the existing contraceptive patch market comes from Medicaid. Again, this just went into effect at the beginning of the fourth quarter of 2021.
This is significant for twirl it because Medicare is the largest Medicaid program in the U S and.
And we believe roughly one third of the existing contraceptive patch market comes from Medicaid.
Again. This just went into effect at the beginning of the fourth quarter of 2021, and we expect to start seeing its contribution to our business as we progressed through quarter four of 2021 and into 2022.
Alfred F. Altomari: And we expect to start seeing this contribution to our business as we progress through quarter four of 2021 and into 2022. Third, DTC and our influencer program. We believe that our DTC advertising program can perhaps have the biggest impact on NRX growth. We recently activated the Branded Influencer Program to increase awareness of TORLA as a birth control option and encourage women in our target market to engage in open conversations about the product. We are focused on leveraging influencers via Instagram and ensuring this program focuses on Twirla through authentic storytelling, which is further supported by our paid social amplification to reach even a broader audience. Our influencers include individuals of varying tiers, from micro to macro, which we believe will allow us to optimize the unique benefits each level of influencer offers.
Third DTC and our Influencer program.
We believe that our DTC advertising program can perhaps have the biggest impact on <unk> growth.
We recently activated branded Influencer program to increase awareness of Tortola at birth control options and encourage women in our target market to engage and open conversations about the product.
We are focused on leveraging influencers via Instagram and ensuring this program focused on swirling trutanich storytelling, which further supported by our paid social amplification to reach even a broader audience.
Our influencers include individuals' ovarian tiers from micro to macro, which we believe will allow us to optimize unique benefits each level of influence or offers.
We rolled out our first wave of activity in early October and are seeing the type of engagement, we envision not just likes and impressions, but also in the comments and conversations we are pleased with the first wave of Influencers and hope we continue.
Alfred F. Altomari: We rolled out our first wave of activity in early October and are seeing the type of engagement we anticipate, not just likes and impressions but also in the comments and conversation. We are pleased with the first wave of influencers and the posts. We continue to focus on this to reach our target market. We previously discussed our plans for DT Advertisements and are pleased to announce that Torla is the first prescription birth control brand to launch branded podcasts on Spotify. Twirla is also the first birth control brand to run branded content across BuzzFeed, leveraging its social handles across Facebook, Instagram, and Snapchat.
To focus here to reach our target market.
We previously discussed our plans for DTC advertisements and are pleased to announce the toilet is the first prescription birth control brand to launch branded podcasts on Spotify.
<unk> is also the first birth control brands to run branded content across Buzzfeed, leveraging their social handles across Facebook Instagram and Snapchat.
Finally, and importantly, we are partnering with U S Soccer Star Carli Lloyd as our corporate spokesperson.
Alfred F. Altomari: Finally, and importantly, we are partnering with U.S. soccer star Carly Lloyd as our corporate spokesperson. As our corporate spokesperson, we believe she will help amplify the message of our commitment to women's health. As the partnership really kicks off later this year and throughout 2022, you can expect to see Lloyd promoting Agile and its mission on Instagram and Facebook, where she has a combined two million followers.
At corporate spokesperson we believe she will help amplify the message of our commitment to women's health.
The partnership really kick starts later this year and throughout 2022, you can expect to see carli Lloyd promoting agile and it's missing on Instagram and Facebook, where she has a combined 2 million followers.
These are important initiatives, which we believe build our business at the top of the call I reported we saw growth in all our key brand performance metrics. This is without the contributions of any of the programs I just mentioned.
Alfred F. Altomari: These are important initiatives which we believe build our business. At the start of the call, I reported that we saw growth on all our key brand performance metrics. This is without the contributions of any of the programs I just mentioned.
As we continue to implement these programs, we believe they will contribute significantly to increase product awareness uptake and growth acceleration as we finish 2021 and enter 2022.
Alfred F. Altomari: As we continue to implement these programs, we believe they will contribute significantly to increased product awareness, uptake, and growth acceleration as we finish 2021 and enter 2022. I also want to review two other announcements from the third quarter that we anticipate having a positive impact on our overall business. First, with the appointment of Josephine Terente to our board of directors. Josephine is a highly experienced regulatory expert who we believe can contribute to the growth of our company through her strategic insights into the FDA regulatory process and her experience evaluating business development opportunities.
I also wonder where U two other announcements for the third quarter that we are anticipate having positive impact on our overall business.
The appointment of Joseph to rent base to our board of directors Josephine is a highly experienced regulatory expert who we believe can contribute to our growth of our company through her strategic insight when the FDA regulatory process and our experienced evaluating business development opportunities.
We believe this will be useful as we evaluate our own pipeline and explore other ways to expand our business.
Alfred F. Altomari: We believe this will be useful as we evaluate our own pipeline and explore other ways to expand our business. Second, the Patient Protection and Affordable Care Act, or ACA, established an important standard for coverage of contraception; nearly all commercial and Medicaid coverages are required to cover the full range of female controlled contraceptives without cost-sharing such as co-insurance, co-payment, or deductible. However, despite the ACA protections and the government's guidance on implementation
Second the patient protection Affordable Care Act or AC a established an important standard for coverage of contraceptives.
Nearly all the commercial and Medicaid coverages are required to cover the full range of female controlled contraceptive without cost sharing such as co insurance co payment or deductibles.
Despite the HCA protections and the government's guidance on implementation women around the country are not getting the contraceptive they need or a prescribed or are entitled to a no call.
Alfred F. Altomari: Women around the country are not getting the contraceptive they need or are prescribed or are entitled to at no cost. Recently, Health Committee leaders, The National Women's Law Center, and the Family Planning Council all urged the Biden administration to clarify and enforce the regulation to ensure consumers access to a full range of FDA-approved contraceptives. We believe this issue has been an impediment to prescribing and the uptake of all new innovative contraceptive products, including Swirler, that have been approved by the FDA since the ACA's past.
Recently health community leaders.
National Women's Law Center, and the family Planning Council all urged the body administration to clarify and enforced the regulation to ensure consumers access to a whole range of FDA approved contraceptives.
We believe this issue has been an impediment to prescribing and the uptake of all new innovative contraceptive products, including Portland that had been approved by the FDA since the Aci's passage, Kimberly Whelan leaves, our policy and advocacy and market access fragile and is closely following the developments for us.
Alfred F. Altomari: Kimberly Whalen leads policy and advocacy and market access for Agile and is closely following the developments for us. We hope to see the Biden administration address this important issue and ensure all women have access to contraception that has been decided as medically appropriate between the patient and their provider.
We hope to see the bonded administration address this important issue and.
And ensure all women have access to contraception that has been decided as medically appropriate between the patient and their provider.
We believe that we've been able to grow despite this access barrier and we applaud the congressional chairs for urging enforcement.
Matthew Riley: We believe that we've been able to grow despite this access barrier, and we applaud the congressional chairs for urging enforcement. I'll now turn over the call to Dennis to provide you with more clarity about the third quarter from a financial perspective. Dennis, take it over.
I'll now turn it over the call to Dennis.
Variety more clarity about the third quarter from a financial perspective, Dennis take it over.
Thank you Al My goal here is to highlight key financial areas related to our financial performance and our cash position then move over to Q&A. So we can answer your questions.
Matthew Riley: Thank you, Al. My goal here is to highlight key financial areas related to our financial performance and our cash position, then move over to Q&A so we can answer your question. In the third quarter of 2021, we realized net product revenue of $1.3 million on sale. As Al stated, this came in slightly under our guidance as our wholesalers reduced their channel inventory by approximately eight days. The equivalent of $115,000 to $160,000 in net sale.
In the third quarter of 2021, we realized net product revenue of $1 3 million on sales as Al stated this came in slightly under our guidance as our wholesalers reduced our channel inventory by approximately eight days.
The equivalent of 115 to $160000 in net sales.
In addition, we made some increases on our gross to net revenue allowances.
Matthew Riley: In addition, we made some increases to our gross to net revenue allowance. Our cost of product revenue for Q3 2021 was $2.7 million and included a $1.4 million inventory obsolescence charge. This reflects our initial reserve for inventory that is not expected to be sold prior to its shelf life date, which is 12 months prior to expiry.
Our cost of product revenue for Q3 2021.
It was $2 7 million.
And included a one 4 million inventory obsolescence charge. This reflects our initial reserve for inventory that is not expected to be sold prior to its shelf life date, which is 12 months prior to expiry.
Our operating expenses were $14 4 million in Q3, 2021 versus $14 7 million in the same period a year ago.
Matthew Riley: Our operating expenses were $14.4 million in Q3 2021 versus $14.7 million in the same period a year ago. We remain focused on maintaining our disciplined spending approach and making the right investments to encourage strategic growth and maximize shareholder value while implementing what we believe to be impactful partnerships and agreements. We anticipate our quarterly spending for the fourth quarter of 2021 to be in the range of $15 to $18 million, with increases reflecting commercial spending on product sample batches and branded markets.
We remain focused on maintaining our disciplined spending approach.
And making the right investments to encourage strategic growth.
And maximize shareholder value.
While implementing what we believed to be impactful partnerships and agreements.
We anticipate our quarterly spending for the fourth quarter 2021 to be in the range of $15 million to $18 million.
Increases, reflecting commercial spending on product sample batches.
Unbranded market.
We closed out the third quarter of 2021, with a net loss of $16 $8 million or <unk> 18 per share.
Matthew Riley: We closed out the third quarter of 2021 with a net loss of $16.8 million, or $0.18 per share, compared to a net loss of $15.5 million, or $0.18 per share, for the comparable period in 2020. As of September 30, 2021, we had cash and cash equivalents of $14.7 million, compared to $31.1 million of cash and cash equivalents at the end of the second quarter of 2021. Most recently, we raised an additional $21.1 million of net proceeds in a public office.
<unk> to net loss of $15 5 million or 18 cents a share for the comparable period in 2020.
As of September 32021, we had cash and cash equivalents of $14 $7 million compared to $31 1 million of cash and cash equivalents.
At the end of the second quarter 2021.
Most recently, we raised an additional $21 1 million of net proceeds in a public offering.
We will require additional capital to achieve our goal of profitability.
We anticipate that as we accelerate sales growth our optics on revenue will become clearer and allow us to better define the path and timeline to profitability.
Matthew Riley: We will require additional capital to achieve our goal of profitability. We anticipate that as we accelerate sales growth, our optics on revenue will become clearer and allow us to better define the path and timeline to profitability. We continue to evaluate all options available to us to finance the company. We were thrilled to see Perceptive Advisors once again support our company in our most recent raise, as well as several other high-profile institutions.
We continue to evaluate all options available to us to finance the company.
We were thrilled to see perceptive advisers once again support our company and our most recent raise as well as several other high profile institutions. We currently have no plans to further leverage the company with debt and pulled down additional funds under the perceptive.
Matthew Riley: We currently have no plans to further leverage the company with debt and pull down additional funds under the perceptive facility. Instead, we'll continue to explore various business development and partnership opportunities in our quest to accelerate our path to profitability. We're happy to expound on any of these areas discussed during today's call, and Operator, you can now open up for questions. Thank you.
<unk>.
We will continue to explore various business development and partnership opportunities in our quest to accelerate our path to profitability.
We're happy to expand on any of these areas discussed during today's call and operator, you can now open up for questions.
Thank you as a reminder to ask a question just press Star and then the number one on your telephone keypad again, just press Star and then the number one on your telephone keypad and can we draw. Your question just press the pound key please standby, while we compile the Q&A roster.
Operator: And thank you. As a reminder, to ask your question, just press star and then the number one on your telephone keypad. Again, just press star and then the number one on your telephone keypad. And to withdraw your question, just press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from the line of Leyland Gershel from Oppenheimer. Please proceed with your question.
Your first question comes from the line of Leland <unk> from Oppenheimer. Please proceed with your question.
Good afternoon, and thank you very much for taking my question congratulations on the progress very encouraging to see particularly the 86% greater.
Leyland Gershel: Good afternoon. Thank you very much for taking my question. Congratulations on the progress, very encouraging to see, particularly the 86% rate of refills. A couple of questions from me, Dennis. You mentioned that the eight days were scaling down. Just wondering if there's any expectations for any further shift in inventory in the channel or if that should be stable from now on. Also wanted to ask with respect to the recent initiatives by the NWLA and Congress, those letters with respect to ACA coverage.
Way to refills.
Couple of questions from me wanted to ask first in terms of the inventory at wholesalers.
Dennis you had mentioned that the eight days scaling down just wondering if theres any expectations for any further shifts in inventory in the channel or if that should be stable from now on also wanted to ask with respect to the recent initiatives by the BMW L. A in Congress those letters.
With respect to the ACA coverage want to note. One if you can provide us with any.
Even if just qualitative feedback on to what extent tour, let me kind of challenges getting covered because of noncompliance on the part of.
Leyland Gershel: Wanted to note one, if you can provide us with any, even if just qualitative feedback on to what extent TORLA may have had challenges getting covered because of noncompliance on the part of payers under the ACA guidelines and also on any outlook on when we may see action being taken following those letters. Thanks very much.
Payers under the ACA guidelines and also on any outlook on when we may see action being taken.
Following those those letters thanks very much.
Dennis you want to take the first one and I'll take the ICA.
Matthew Riley: Thanks, Leland. Dennis, you want to take the first one and I'll take the ACA? Yeah, I mean, we anticipate we're there on the wholesalers. You know, we don't have, [inaudible] So I would say they're in sync going forward. My only other comment.
Yes, I mean, we we anticipate where theyre on the on the wholesalers.
We don't have.
Colo rhythm in any sense, but we do believe that we're running pretty lean now and so I, we expect our our scripts and ultimately our cycle sales, which is a month's supply to start to match up very closely.
Alfred F. Altomari: Thank you for your questions. You know, my only comment is, you know, like, we thought they were at status before the trade. And, you know, I thought they took us down in another eight days, which, you know, a bit surprised us, but it wasn't a twirl only, it was, really, they're just contracting. I mean, you know, we've seen it across all the books of business.
In Q4, and going forward with actually wholesaler sales.
I would say they're in sync going forward.
Okay Leland.
My only other comment thank you for your questions.
My only comment is.
We thought the REIT status before the trade and that they took they took us down in another eight days, which is a bit surprise us, but it wasn't a squirrel only him.
Really they are just contracting.
We've seen it across all the books of business. So.
We think we are at steady state, but we thought that before but we'll continue to monitor it but at this point I don't know how much more lower they can go it's almost just in time inventory at this point Dennis I would think so about the affordable care Act to your second comment Leland.
Alfred F. Altomari: So we think we're at steady state, but we thought that before, but, you know, we'll continue to monitor it. But at this point, I don't know how much lower they can go. It's almost just in time inventory at this point, Dennis, I would think.
So how is it impacted squirrel less so just.
Alfred F. Altomari: So about the Affordable Care Act, your second comment, Leland, Yeah, so how does it impact the twirl list? So just to kind of lay this out for the listeners, there are two parts to the ACA when we talk about compliance. You know, I think everybody knows now that there are 18 forms of contraceptives. There's this famous chart that's, you know, they cite, and the plans are required to carry one of every product, including a patch. So that's part A Leland.
<unk> kind of latest out for the listeners theres two parts of the ACI when we talk about compliance.
I think everybody knows now that Theres 18 forms of contraceptive Theres. This famous charts.
Site and the plans are required to carry one of every product, including a patch.
That's part a leland and so I think part B is the one that we think and it's not as well discussed.
Alfred F. Altomari: So I think part B is the one that we think, and it's not as well discussed, you know, but if a doctor wants a woman to be on the twirl list, there's a form that you'll see on our website twirl.com called a letter of medical necessity. By law, you know, it's not a prior authorization. By law, if a doctor says, I want this woman on the twirl list, the plan cannot say no. The decision is up to the doctor. It's not a prior auth.
But what if.
If a doctor wants a woman to be on Tomorrowland.
As a form that youll see in our website throw dot com called a letter of medical necessity.
By law.
It's not a prior off by law, if a doctor says I want this woman on tour.
The plan cannot say no. The decision is up to the Doctor it's not a prior off it's not like anything else. We've seen it's a very unique aspect we have seen a lot of denials for <unk> and a lot of the new brands. So it's just not us. So the insurance companies are basically saying in their pbms are saying.
Alfred F. Altomari: It's not like anything else we've seen. It's a very unique aspect. We have seen a lot of denials for TORLA and a lot of the new brands, you know, so it's just not us. So the insurance companies are basically saying, and their PBMs are saying, no, we're just going to deny it. And doctors go away. So that's why we set up Sterling Drug and people like that that say, no, no, no. That's not how it works. So it just creates, you know, a bit of a kind of headwind in the doctor's mind that this drug is hard to get across the goal line.
Now, we're just kind of denial factors go away. So that's why we set up sterling drug and people like that and say no no no that's not how it works.
So it just creates a bit of a kind of a headwind, but the doctor's mind.
This trial is hard to get across the goal line now or it's improving a lot.
But it certainly held us back and the interesting part is I need to read these documentations, which I would encourage you. This is not just in the commercial plans. Unfortunately, didnt Medicaid and so also in the government's own plans.
Alfred F. Altomari: Now, it's improving a lot, but it's certainly held us back. And the interesting part, if any of you have read these documents, which I would encourage you to do, this is not just in the commercial plans. Unfortunately, it's in Medicaid, and it's also in the government's own plans.
The state their own books of business.
Their own employees arent getting the access they deserve so.
Alfred F. Altomari: Their own books of business and their own employees aren't getting the access they deserve. So, you know, like I said, we really, really applaud all three organizations for stepping up, and it's the voice of, you know, Congress, it's the voice of the Women's Law Center. I've been in the courts fighting a lot of these cases over the years about the ACA, and it's the women's group. So each one of them spoke with a pretty loud voice, as we did, that this wasn't the way the law was intended. So we need to clarify this again. Again, it's been clarified before. And we'd encourage, if necessary, to be enforced. Something's got to change.
Like I said, we've we've really really applaud all three organizations.
For stepping up and it's the voice of Congress. It's the voice of the women's Law Center who's been the person in the courts fighting a lot of these cases over the years about the ICA and it's the women's groups. So each one of them spoke with a pretty loud voice as we are.
It wasn't the way the law was intended so we need to clarify. This again you know again, it's been clarified before and we'd encourage to nessus.
Necessary to be enforcement Something's got to change despite that we're proud of the growth I mean to put up the growth we've done.
Because as you might imagine very proud of the organization. So when does it get fixed Leland.
Alfred F. Altomari: Despite that, we're proud to grow. I mean, to put up the growth we've done, you know, as you might imagine, I'm very proud of the organization. So when does it get fixed, Leland? That's the question Mr. Riley asks me all the time. You know, we just don't know.
Mr. Riley asked me all the time.
We just don't know there was a short short turnaround time on the congressional letter that was probably too short. So we are aware of some conversations that are going on at the highest levels.
Alfred F. Altomari: There was a short, short turnaround time on the congressional letter that was probably too short. So we are aware of some conversations that are going on at the highest levels. You know, but we expect action now. What the action will mean, most likely, hopefully they'll re-clarify all this for the, for the industry, and, if necessary, take enforcement action.
But we expect action.
Now the action, what it'll mean most likely.
Hopefully they'll require Fi all of this.
For the for the industry.
And if necessary take enforcement action, but.
We think our we still think we are better days ahead of us on this it just makes writing our drug a lot easier.
Alfred F. Altomari: But, um, you know, we still think we have our better days ahead of us on this. It just makes writing our drug a lot easier, you know, and ideally, we'd love to be on all of them. One of the letters actually went as far as saying all the brands should be available, every FDA product should be available, why are we dealing with this chart, why don't we make everybody available for no co-pay, because that really was the intent of the ad.
Ideally, we'd love to be on all wanted to letters actually went as far as saying all the brand should be available every FDA product should be available why are we dealing with this chart why don't make everybody available for no co pay because that really wasn't the intent of the act.
So thats the homerun, so if we can't get the homerun just to be able to get the prescriptions and the doctors wishes, but certainly be a win for us.
Alfred F. Altomari: So that's the home run, you know, so if we can't get the home run, just being able to get the prescriptions and the doctors' wishes would certainly be a win for us. You know, I thank you for your comment about refills. I'm thrilled. It just speaks to this brand and the stickiness of this brand and, you know, women just liking this product. It just makes us feel great and gives us a beachhead of volume every week to build off of Leland.
Thank you for your comment about refills I'm thrilled that speaks to this brand and the stickiness of this brand and women just liking. This product that just makes us feel great and just give us a beachhead of volume every week to build off of Leland. So it's a it's a nice day.
Terrific terrific. Thanks, so much I'll Ellen Dennis So both Q.
Leyland Gershel: So it's a nice day. Terrific, terrific. Thanks so much, Al and Dennis. Thank you.
Frankly.
Thank you. The next question comes from the line of Oren <unk> from H C. Wainwright. Please proceed with your question.
Operator: Thank you. The next question comes from the line of Oren Livnat from H.C. Wainwright. Please proceed with your question.
Thanks, I have a few appeal indulge me just quickly on the ACI situation.
Oren Gabriel Livnat: Thanks. I have a few, if you'll indulge me.
How relevant is there that.
Alfred F. Altomari: Um, just quickly on the ACA mandate situation. How relevant is it that there is a generic Zulane out there now? I mean, we know that they're not even living up to their promise of covering one in every form under ACA. But even if they were to meet that low bar, do you think you would still have some challenges getting coverage in that regime given that Zulane and Zefemi, or however you pronounce it, are out there?
There is a xul aimed generic out there now I mean, we.
We know that they're not even living up to their promise probably have even covering one of every form.
Under ACA, but even if they were to meet that low bar.
Do you think you would still have some challenges getting coverage.
In that regime, given the lane and that Fermi or have you pronounce that are out there and then I have a couple follow ups.
Great question.
So there is kind of like part a and part b. So the best we can see people are supposed to make let's be specific about our patch either us or zoolander itself. How many available on the plans. The best we could see it appears they have done that so that's the part a so.
Alfred F. Altomari: And then I have a couple of follow-ups. Yeah, Oren, great question. Yeah, so there's kind of like part A and part B. So, you know, the best we can see, people are supposed to make, let's be specific about Apache, either us or Zulane or Zefemi available on the plans. The best we can see, it appears they've done that. So that's part A.
So I think from a compliance perspective and a.
Following it'll act or and they seem to be in compliance there.
Alfred F. Altomari: So I think from a compliance perspective and, you know, and following it'll act, Oren, they seem to be in compliance there, in the Xero Copay. So we could be on formulary on a non-zero copay. We could be a, let's say, you know, $40, $50 copay. You know, we're not getting a zero or the preferred.
Part B of the act is let's use a situation that we're not on formulary zulay as on formulary.
And the zero copay.
So we could be on formulary on a non zero copay, we it could be let's say.
$40 $50 co pay.
Zero or the preferred so in that case, we can deploy our.
Easy for us to handle we can deploy some.
Alfred F. Altomari: So in that case, we can deploy our, you know, that's easy for us to handle. We can deploy some couponing and things, you know, and handle that. But let's say we're locked out. So we're off by one.
Couponing and things.
<unk> handle that but let's say, we're locked out so we're off formulary and that situation and you go to our website you pull down that form for doctor fills it out and Thats scripts supposed to work not only the first timely.
Alfred F. Altomari: In that situation, you go to our website, you pull down that form, the doctor fills it out, and that script's supposed to walk not only the first time, Oren, but every time she goes in the... She's on it. She's she's got a you know, That's where we're seeing, you know, a lot of the Dr. Scott Coiante, Unknown Executive, Nazibur Rahman, Amy Welsh, Matthew Riley, Agile, You know, that's the battles we're fighting, you know, but now with that said, contextualize COVID for what we've been through with COVID and this resistance, we're getting in some of the plans and just try to put our growth and perspective on that.
But every time she goes in the field.
She's on it she is she's got a.
The system, that's what we're seeing.
What are the resistance.
To comply with that part of the Affordable Care Act so.
Is that just again Doctor goes the trouble fill this out for a woman she gets not again, they more than likely I just wanted to go back to Julie.
That's the battles were fighting, but now with that said contextualized COVID-19 for what we've been through with Covid and this resistance, we're getting in some of the plans and just try to put our growth in perspective on that so I do believe that piece.
Nothing else that these letters of medical necessity you just go through the system as intended that they should go through it in a.
Alfred F. Altomari: So I do believe that, And nothing else but these letters of medical necessity, you're just so... As intended, they should go through it for a very short amount of time, and then the patient, by the time she gets to the pharmacy, should have that drug, and then she should be freed up. That's the way, in the simplest form. Okay, and then if I could just follow up on that. You did mention in the quarter that growth to nets was up. I assume that means sequentially over 2Q.
Very short amount of time and then the patient by time. She gets the pharmacy should have that drug and then she should be on the freed up so that's that.
It's the way in the simplest form it works.
Okay, and then if I could just follow up on that.
You did mentioned in the quarter gross to nets were up.
I assume that means sequentially over Q O Q.
Is that simply a reflection of just having to have increased patient assistance utilization in light of the challenges Ive just covered.
Oren Gabriel Livnat: Is that simply a reflection of just having to have increased patient assistance utilization in light of the challenges you've just, you know, covered? Or is that also potentially reflects some actual contracting some, you know, some economics that you've worked out to get coverage on the payer side? And in the meantime, you know, where you don't have coverage, and you don't have ACA compliance, you know, how are you making sure that doctors don't get frustrated and give up so that they can, you know, continue to keep writing prescriptions, and patients keep getting them one way or another, you know, profitably or otherwise, so that, you know, down the road, you can convert all that, you know, into, you know Yeah, I'll do the second part, and then I'll comment, and you can correct me if I'm wrong about the gross net.
Or is that also potentially if that's an actual contracting some you know some some economics that you've worked out to get coverage on the payer side.
And in the meantime, where you don't have coverage and you don't have ACA compliance.
How are you, making sure that doctors don't get fresh.
Frustrated and give up.
So that they can.
Continued to keep writing it and patients keep getting it one way or another you know profitably or otherwise to that you know down the road you can convert all of that into sustainable revenue update.
I'll do the second part then Dennis I'll comment and you can correct me if I'm wrong on the gross to net.
The last part of the last question is the simplest way our reps do this is they just tell a doc just just give us just give us the script transmit the scripted to sterling.
Alfred F. Altomari: So, the last part of the last question, you know, the simplest way our reps do this is they just tell a doctor, just give us the script, and transmit the script to Sterling. Sterling is experts at processing those claims, you know; we are seeing a lot more of our business run through Sterling, so, you know, we just basically tell the doctor, say, hey doctor, just send it to us, we'll adjudicate it, we'll do the insurance claims, and we'll do these letters of medical necessity.
Sterling, we're experts at processing those claims.
We are seeing a lot more of our business run through Sterling. So we just basically tell the Doc say, hey, Doc like just send thoughts will judicate. It will do to insurance claims and we will do this letters of medical necessity, if we need to and then the patient gets the choice, let's say everything goes through swimmingly, and we get the patient across the goal line.
Alfred F. Altomari: And then the patient gets the choice, let's say everything goes swimmingly and we get the patient across the goal line. What happens, Oren? We could say to the patient or the doctors, we can ship the drug to our house, or we could ship it to our local CVS. So it's a concierge service, in effect, that makes the doctor's life easier. So our best reps are the ones that just say, hey, doctor, why work with this? Just give them the money.
What happens or and we could say to the patient or the docs and we can transfer that we can ship the drug for a house or we could ship it to our local Cvs. So it's a concierge service in effect that makes the doctor's life easier. So our best reps are the ones that just say hey, Doc why work with that's just given US now if we know we're on a plan like a big.
Big area that we've got a lot of great coverage, we shouldnt have to do that there are.
Alfred F. Altomari: Now, if we know we're on a plan, like in a big area where we've got a lot of great coverage, we shouldn't have to do that. You know, there are major books of business that we could just say, look, in Connecticut Medicaid, it goes through, in Medi-Cal it's going to go through, you don't even need to do these gymnastics. So if we could point to big plans, Oren, it's a lot easier just to do it that way.
Major books of business that we could sort of say look in Connecticut Medicaid It goes through in Medicare, It's going to go through it you don't even need the duties gymnastics. So if we can point to big plans are and it's a lot easier.
Just to do it that way and then I'll comment on the gross to net and then Dennis.
Correct me, if I'm going over my skis, but.
Alfred F. Altomari: And then I'll comment on the growth in that, and then Dennis could, you know, correct me if I'm over my skis, but look, we're seeing more of our business running through Medicaid, as we would expect, as we've signaled, that's an important part of our business. Remember, in the first and second quarters, we didn't have much Medicaid coverage. So we're seeing Medicaid becoming more of a part, so that's a little bite at the apple.
We're seeing more of our business running through Medicaid as we would expect as we've signaled that's an important part of our business remember in the first and second quarter. We didn't have much Medicaid coverage. So we're seeing Medicaid becoming more parts. So thats a little bite at the Apple and then I think the other one is co pay cards to generally more.
We are dealing with co pays co pay utilization creeped up but it is I think theres a lot of little Dennis but I think are they the two headlines that I should remember, yes. They those are at and the co pay being the one that kind of came up well both came up a bit with co pay even a little bit more this quarter.
Alfred F. Altomari: And then I think the other one is co-pay cards. Generally, the more we're dealing with co-pays, co-pay utilization has creeped up, but it is, I think there's a lot of little that is, but I think, are those the two headlines that I should remember? Yeah, those are it, and the co-pay being the one that kind of came up, well, both came up a bit, but the co-pay came up even a little bit more.
Can you tell us what the gross to nets are sort of all in.
We're still in the low thirty's.
Discounts, including the 12% from the wholesalers.
Okay.
Alfred F. Altomari: Can you tell us what the growth nets are sort of all in? You know, we're still in, in like the low 30s on distance, including the 12% from the wholesalers. Well, thanks. Catch up with you guys after. Thanks.
Well thanks, guys.
Thanks Art.
Okay.
Thank you once again as a reminder to ask a question just press Star and then the number one on your telephone keypad again, just press Star and then the number one on your telephone keypad.
For the next question we have now the line of team logo from William Blair. Please proceed with your question.
Oren Gabriel Livnat: Thank you. Once again, as a reminder, to ask your question, just press star and then the number one on your telephone keypad. Again, just press star and then the number one on your telephone keypad. For the next question, we now have the line for Team Vago from William Baer. Please proceed with your question.
Hi team. This is John on for Tim. Thanks, So much for taking my question just two from us.
First wanted to say congrats on the new marketing efforts and I was wondering if you could give an update on your previously announced campaign such as your efforts on the dating App do you have any updates on how those campaigns are progressing and you have any insight into.
How they've been translating into scripts.
Operator: Hi team, this is Jon on for Tim. Thanks so much for taking our questions; just two from us. So, first, I wanted to say congratulations on the new marketing efforts. And I was wondering if you could give an update on your previously announced campaign, such as your efforts on the dating app. Do you have any updates on how those campaigns are progressing, and do you have any insight into how they've been translating into script?
And second on previous calls.
Noted that about half of your patients had been brand new to contraception that quarter switches from pills and the remainder in mix are those still the trends that youre seeing or is there any indication that mix is changing thanks, yeah. No. Thank you for the questions I'm and I'm no. The mix based on last time I looked at the data hasnt changed the direction.
What you just quoted is still there about half of our business comes from what we believe is a new start.
She could have been on drug before maybe you had a baby and re entered but she looks like a new patient thoughts and about 25% coming from a pill.
Jon: And second, on previous calls, you've noted that about half of your patients are brand-new to contraception, about a quarter are switches from pills, and the remainder are a mix. Are those still the trends that you're seeing, or is there any indication that the mix is changing? Thanks. Yeah. No. Thank you for the questions. I mean, no.
That is our major source about you had a dating apps just in general the marketing campaigns. We're encouraged by what we're seeing I mean or are we just started having off our spends.
I think we mentioned in the second quarter was pretty light spending in DTC and a relative basis third quarter is the first time, we went at it for the most part are full bore at the levels. We thought we showed and we saw our first of all our website light up which is very encouraging.
Alfred F. Altomari: The mix, you know, based on the last time I looked at the data, hasn't changed. So, directionally, what you just quoted is still there. About half our business comes from what we believe is a new start, you know. She could have been on drugs before, and maybe had a baby, and re-entered, but she looks like a new patient to us, and about 25% come from a pill.
So we're seeing like a 10 fold increase in our historic <unk> dot com, but equally as important or more important we're seeing prescriptions one of the things we look at as.
We look at where our prescriptions are coming from and we're starting to see prescription is starting to show up in parts of the country that we don't have reps and so I'd love to give myself because I didn't think it works in harmony perfect World.
Alfred F. Altomari: So, that is our major source of buy-in. You know, the dating apps, you know, just in general, the marketing campaigns were encouraged by what we're seeing. I mean, when we just started heavying up our spends, you know, and I think we mentioned in the second quarter, it was pretty light spending in DTC on a relative basis. The third quarter was the first time we went at it, you know, for the most part, full bore, you know, at the levels we thought we should.
We're starting to see.
Fair number of business coming from pure pure white space that we have not been in front of them before which is to me an indicator that it's working so it works better if we have a rep. There and then the dating App specifically every metric that we've seen or we would have expected because basically we're buying media. So we're saying we're buying eyeballs right. So in that.
Alfred F. Altomari: And we saw our, first of all, our website light up, which is very encouraging, you know. So, we're seeing a tenfold increase in our hits on toronto.com. But equally as important, or more important, you know, we're seeing prescriptions. One of the things we look at is where our prescriptions are coming from, and we're starting to see prescriptions starting to show up in parts of the country that we don't have reps in. So, I'd love to get my sales because I do think it works in harmony, you know, in a perfect world.
We're buying through the dating apps were off the charts.
And the execution. So we're just getting more visits.
More more continuity on these apps.
That seems to be our highest performing media on the dating apps, which I know is obvious, but we actually rank them. We say, it's like buying advertising you say I bought advertising in 10 magazines in the old days in which one work better.
Actually able to tell which ones are getting the most traffic in the most pull through and the most eyeballs and that's that's top Elisa.
Alfred F. Altomari: You know, but we're starting to see a fair number of business coming from pure, pure white space that we have not been in front of before, which is, to me, an indicator that it's working. So, it works better if we have a rep there. And then the dating app specifically, you know, every metric that we've seen or that we would have expected, because basically, we're buying media. So, we're saying we're buying eyeballs, right? So, in that case, we're buying through dating apps. We're off the charts in the execution.
The answer if Amy was here she would say she is thrilled with it that that idea because it's unique it's perfectly targeted and it's actually outperformed.
Outperformed all our metrics, but still early days I mean, we still got to see our campaign run a little bit longer it's only been kind of a few months running at full bore so we're.
We're excited to leave it out there a little bit longer and so you would see what's happening and keep it fresh.
Alright, Thanks again for the update congrats congrats on the progress.
Thank you.
Yeah.
Thank you once again as a reminder to ask your question just press Star and then the number one on your telephone keypad.
Alfred F. Altomari: So, we're just getting more visits, you know, more continuity on these apps. That seems to be our highest performing medium, you know, on the dating apps, which I know is obvious. But we actually rank them. We say it's like buying advertising. You say, I bought advertising in 10 magazines in the old days, and which one worked better? We're actually able to tell, you know, which ones are getting the most traffic and the most pull-through, and the most eyeballs. And that's top of the list. I think the answer, if Amy were here, she would say she's thrilled with that idea because it's unique.
Yeah.
Yeah.
There are no further questions. Thank you I will now turn the call back to Al Jimi.
Well. Thank you operator, thanks to Matt and Dennis also for your house on the call. So hopefully you had a couple of takeaways Tonight.
Number one first and foremost we need to remind yourself, we have an improved product that's growing in a very large multibillion dollar market.
Discussed Tonight, some of the challenges, we face, but we pushed through and particularly with some of the larger challenges that face our company and our brand, but I'm I'm ecstatic with the brand's performance and.
Alfred F. Altomari: Perfectly targeted, and it's actually, you know, outperformed all our metrics. But still early days, I mean, we've still got to see our campaign run a little bit longer. It's only been kind of a few months running at full bore.
The potential of this brand.
We have the cash to support our business and to cut.
That we would anticipate that as sales grow our optics on revenue become more and more clearer. So we you know it'll be much easier for us to define our path to profitability because that's our singular requests in the company to become profitable and sustainable.
Alfred F. Altomari: So we're excited to leave it out there for a little bit longer and see what's happening and keep it fresh. Alright, thanks again for the update and congratulations on the progress. Oh, thank you. Thank you once again. As a reminder, to ask your question, just press star and then the number one on your telephone keypad.
We believe that these initiatives have been effective.
<unk> helped expand <unk> access in particular DTC programs that we think are aimed at accelerating our growth.
Operator: Thank you once again. As a reminder to ask your question, just press star and then the number one on your telephone keypad. There are no further questions sent to you.
We'll continue to explore and implement additional partnerships and keep you updated on those.
Alfred F. Altomari: I will now turn the call back to Al. First of all, thank you, Operator. Thanks to Matt and Dennis also for your help on the call. So, hopefully, you had a couple takeaways tonight.
We continue to look for other opportunities to expand the brands and to expand its brand to reach Theres a lot more of the market that we still think we can get at so I'm.
Alfred F. Altomari: Number one, first and foremost, we need to remind ourselves we have an improved product that's growing in a very large, multibillion-dollar market. We discussed tonight some of the challenges we face, but we pushed through, and particularly with some of the larger challenges that face our company and our brand. But I'm ecstatic with the brand's performance and the potential of this brand. We have the cash to support our business and anticipate that as sales grow, our outlook on revenue will become more and more clearer.
I'm pleased with the progress you should expect more progress from us and we'll keep you updated on future calls, but thank you everybody for joining the call Tonight, and and keeping track of us keeping update on whats turned out to be a real exciting story. So thank you all and everybody have a good night.
This concludes today's conference call. Thank you for participating you may now disconnect.
Okay.
[music].
Alfred F. Altomari: So it will be much easier for us to define our path to profitability because that's our singular quest in the company to become profitable and sustainable. You know, we believe that these initiatives have been effective in helping expand squirrel's access, in particular DTC programs that we think are aimed at accelerating our growth. We'll continue to explore and implement additional partnerships and keep you updated on those. We will continue to look for other opportunities to expand the brands and expand its reach. There's a lot more of the market that we still think we can get into.
Yes.
Yes.
[music].
Thanks Roger.
[music].
Alfred F. Altomari: So I'm pleased with the progress. You should expect more progress from us, and we'll keep you updated on future calls. But thank you, everybody, for joining the call tonight and keeping track of us and keeping updated on what's turning out to be a really exciting story. So thank you all, and everybody have a good night. This concludes today's conference call. Thank you for participating. You may now disconnect.
Okay.
Great.
[music].
Operator: Scott Coiante, Unknown Executive, Nazibur Rahman, Amy Welsh, Matthew Riley, Scott Coiante, [inaudible]