Q3 2021 Evoke Pharma Inc Earnings Call
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Hi, it's one to 28707.
Thank you and you may have the spelling of your personal last time place.
Yeah.
For each L. R E C H L.
Smith S M I T H.
I'm sorry. Your first name is Rachel that's our a C H E.
L.
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No.
Yes, that's correct.
Oh Man I mean, your first name Rachel R. A C E. G. L is that correct.
And your institution named please the spelling.
A I E R E.
Hey for Apple I E.
So our firm you <unk> is that correct.
Mhm last letter if were awful.
I'm, sorry for that and I'll join you now have a good one.
Thank.
Suffered to cardiac arrest.
After finding a new gastroenterologists, who focused on improving your symptoms and who proactively Calder when Joe Modi became available.
She now reports and I quote from our interview.
Jim Odious change my outlook on life, I can actually get up and I can even mingle and I can run and play with my grandkids.
Can get up and they can stay up all day I have.
Energy and the biggest one of all is that I'm not in the hospital anymore I spend all my time at home and in fact I haven't been in the hospital for GI issues since I got on Jim Modi.
She also reports we found out she is now up to almost 115 pounds.
While this is only a single patient anecdote to hear the genuine sense of optimism in her voice brought the full organization to understand how important our work to bring new options to treat diabetic gastroparesis truly is.
Additionally, her physician practicing gastroenterologists participated in the meeting as well and presented an important relevant information about the diagnosis and treatment of patients with Gastroparesis.
The sales team also had access to the physician to answer questions important to their selling efforts.
He noted as personal treatment regimen has undergone a paradigm shift and is now transferring almost all of its current patients on oral metoclopramide treatments to Jim Modi.
Again. This example does not yet represent the majority of treating providers, but our goal is that this his experience and approach.
As soon understood by many more in the field.
This meeting has also helped to improve our team working dynamics and communication.
Matt, Chris and I were able to present, our goals for <unk> and the company more effectively to the sales team.
After the experience I'm confident that every participant emerged from the meeting with a sense of unity purpose in a shared common goal for success.
And I'm convinced that this meeting was a significant catalyst along with our marketing efforts that help make the past this past month of October our best month ever.
We are certainly excited about the progress we've made in the third quarter as part of our targeting strategy. It remains critical that we closely monitor our traction among doctors and patients.
An important resource we continued to utilize this tracking our progress specifically among physicians.
Has been our timely HEU studies. Our most recent study that was conducted in October measured awareness trial and usage of <unk> among health care providers.
Based on this wave of the study the data clearly indicates that awareness and adoption of <unk> has continued to expand allowing us to further build your motives presence within the market.
We are equally encouraged by the improvement in awareness and then tend to prescribe among health care professionals, who receive regular visits for our sales team as well as those.
They are exposed to our online digital campaigns.
These data reinforcing strong intent to prescribe and provider request for samples of <unk> drove our decision to begin sampling.
The goal of the sampling program. We introduced in August is to expand access to <unk> and initiate patient trial, allowing physicians and patients.
To experiences therapeutic benefits firsthand.
This has served as an important supplement to our sales efforts and has allowed us to plant more seeds, where the where they matter.
And thats among targeted Gis, who have not yet written a prescription of <unk>.
In addition to providing physicians with samples we encourage them to start the patient enrollment process into our evokes this program as well.
We're confident the sampling program has helped support our commercial efforts.
Another important contributing factor to our bump in patient enrollments has been effective and holistic marketing efforts.
In collaboration with <unk> talented engaged marketing team, we launched the spray away campaign and subsequent collateral aimed to drive awareness of the new treatment option for.
For both consumers and healthcare providers.
It will also support sales growth and improve patient outcomes, while increasing the general understanding of the treatment option.
This campaign was so influential that it received an award for innovation in healthcare marketing.
Last quarter, we launched the first wave of a vital social.
Media campaign to reach patients directly with education about diabetic gastroparesis.
The initial wave of this program consisted of two Facebook pages <unk> branded Facebook page in a diabetic gastroparesis community Facebook page called <unk> and Mi diabetic Gastroparesis support.
Having a strong online presence in today's digital environment is absolutely imperative for reaching our target audience to raise awareness about <unk>.
We look to continue leveraging multiple digital platforms, such as Facebook Facebook pages, and the <unk> web site to help deliver our message.
I'd like to reiterate our continued commitment to improving the lives of those who suffer from symptoms of <unk>.
That of Gastroparesis.
Last month, evoke pharma and ever sign a hosted an exhibit booth at the American College of Gastroenterology 2021 annual scientific meeting.
This was our first opportunity to speak with health care providers. It alive in purse person National conference about the therapeutic benefits of <unk>.
Turning events like this with individuals who share a common goal of improving People's lives was truly an educational empowering experience is.
It is important to remember how our work impacts others and why we must keep moving the needle forward not only as a company, but as the medical discipline.
With that I'd like to turn the call over to Chris for further details on our commercial progress of <unk> Chris.
Thank you, Dave and good afternoon to those of you joining us today.
<unk> have continued to make strong progress in commercializing <unk> and positioning <unk> as the best option to treat diabetic gastroparesis.
Due to its unique nasal spray delivery.
I'd like to emphasize that this is not merely a convenience benefits to patients.
Fundamental solution to a complex disease, which at its core defect is unpredictable or radical stomach campaign, leading to suboptimal treatment with oral therapies.
Continuing to prescribe oral medicines for these patients is not a winning strategy.
By bypassing the Gi track and being directly absorbed into the circulation via the nasal mucosa.
<unk> offers a simple yet elegant solution to relieve acute and recurrent symptoms in patients with diabetic gastroparesis, which are many times to build <unk> as described in the patient story that Dave shared.
Everyday we hear similar moving stories from doctors and patients, which is fire us to work that much harder to put <unk> in the hands of people who need it most.
There are countless testimonials ranging from anecdotes from our sales reps.
Hear from doctors directly to messages posted by patients on our Facebook pages.
Realized examples that fuel our passion to improve the health and daily lives patients struggling with diabetic gastroparesis.
They describe themselves as gas prices for years, and it's remarkable how they persevere with this unrelenting disease in the face of limited current options lack of information and education and significant under treatment and care.
They are marginalized group of people, who need and deserve support and we intend to fill that void with genuity.
Let's discuss the privates, we've continued to make in the third quarter with our commercialization efforts.
Here's some highlights before I share further details with.
We significantly increased reach to our targeted physicians improving reached 12% in the third quarter alone to 56%.
We implemented a sample program in late July early August, which is expanding access in trial in Germany.
We are continuing to gain traction with our online digital and social campaign, which is continuing to increase impressions each month since launch.
We held our first live in person National sales meeting in late September which became our de facto launch meeting.
We launched our national account manager team and we are engaging payers with our unique value proposition.
We continue to expand the number of Hep's prescribing, Germany and are increasing the depth of those that are prescribed in Germany.
And lastly, we began to see wide scale conversion of oral patients to genuity within select physician practices.
Prior to jumping into the commercial efforts I'd like to start by sharing what we are hearing from patients who have diabetic gastroparesis and the levels if.
If you haven't heard these stories I encourage you to visit any of the Gastroparesis Apocalypse online to really appreciate their needs and hear their voices.
There are several themes that repeat cross platforms.
Patients symptoms are significant and incapacitating, resulting in isolation lots of work and the ability to eat and perform than normal daily functions.
Patients are not controlled unplanned therapies and are actively seeking alternatives.
They are seeking advice from one another about how to deal with their nausea, vomiting, and a nominal pain because current medicines are not working or not working fully.
Stories about visits to the.
Hospitalizations insertion of feeding tubes and undergoing six.
Unsuccessful surgeries to fix the problem are commonplace versus the exception.
They recognize that they cannot keep their medicines down most likely due to nausea, and vomiting and resort to share tips and tricks to help each other match.
They are aware that they are not absorbing their medicines and there are many stories and then bumping up medicines hours and days after taking.
They themselves are wondering what happens if all of the medications. They are taking suddenly do empty from the stomach and at the same time.
They discuss options for treatment, including other routes of administration, including patches suppository liquids and IV.
To date most of these discussions are about medicines for other comorbidities, such as depression anxiety migraine diet.
<unk> to name a few.
Hey, even discuss which doctors are truly listening to them and are actively working to improve their condition versus those that are dismissive and referred in Hawaii.
Each of these are critical insights for a vote in our commercialization efforts and are supported by our own market research.
We are focused on driving awareness of <unk> among these patients and the treatment by Gastroenterologists and advanced practice providers.
And we're making significant progress in reaching those targeted health care providers in the face of the third wave of the pandemic, which lasted the entire third quarter and where the U S experienced nearly 70% of the peak weekly volume cases seen in wave two we expanded our reach to 50%, 56% excuse me of our targeted gastro <unk>.
<unk> and advanced practice providers.
This represents a 12% increase in the third quarter alone.
In addition, our access to our top 1000 physician continues to rise topping 86%.
Prove access to Hcp's themselves was driven by the relationships that we built since our launch with the offices and a reliable presence we have established.
We achieved access to 94% of our target offices and are creating office champions along the way.
While there is still a number of cases, where we've seen some of our targets for the first time after making calls on them for an entire year.
Number of these details are resulting in trial of Genuity and ongoing access.
To illustrate this chest recently, we had a case in Charleston, West, Virginia, where a physician was no access since launch.
A representative found a way to finally have an extended discussion.
And the Gastroenterologists decided to try a chimbote, but indicated that he only had a handful of patients on oral metoclopramide.
Further discussion with him caused him to query as electronic medical records. When we discovered that he had greater than 60 patients on generic medical open mind or branded red.
After reviewing these patients to gastroenterologists prescribed 42.
Of those patients commodity on the same day.
This is a great example of how the pandemic has precluded and adoption of new therapeutic options and that we can turn access in these situations into positive trial for patients.
In addition, we are continuing to expand the number of prescribers at quarter end, we saw 84, new prescribing physicians and launched to date, we have 383 total prescribers of <unk>.
Total number of prescribing physicians has risen each quarter from 46 total prescribers in Q4 2020 to 182 in Q3 2021.
And we are focused on continuing to build our base of new prescribers, while expanding the number of patients that previous prescribers are prescribing genuity.
In fact, while the number of new prescribers is expanding the number of prescriptions per existing prescriber is also increasing in nearly two thirds of prescriptions are coming from those acp's.
Previously prescribed suggesting building confidence in Germany.
The growth we are seeing in new prescribers is being realized at the same time as our ongoing sample program that was launched in late July of 2021.
Additionally, refill rates for <unk> were 62% launch to date through the end of the third quarter, a slight improvement over Q2.
The refill rates that we sustained an uptick in the number of prescribing physicians and prescriptions each quarter demonstrates that patients using <unk> are experiencing improved symptom relief.
Dave mentioned, our sampling program.
We're encouraged by the positive reception providers to recede and use samples from patients.
Over 3000 samples have been dispensed since the launch of the program with over 80% of the providers receiving samples being new to Germany.
Meaning that they had not prescribe <unk> prior to the sample program.
Fact that we are seeing an increase in prescribers and prescribing while we are initiating samples for the first time is an encouraging sign.
Samples are disproportionately being delivered to our top decile physicians as well, indicating excellent execution.
Importantly, they are being targeted beyond targeted gas neurologists to targeted nurse practitioners and physician assistants, who perform a significant portion of the medical treatment and follow up for patients with diabetic Gastroparesis. These.
These samples are a month's supply and typically have a dampening effect on prescribing as physicians use these samples to gain experience.
We are actively encouraging sampling and enrolling patients simultaneously to avoid any delay in patient therapy, assuming that patient will have a positive trial.
While we implemented the sample program in late July and samples began to arrive in offices in August we don't expect to receive the full benefit of these patient trials until mid fourth quarter.
We are also seeing more details to providers in the three months after sampling similarly compared to the three months prior to the samples being provided.
There were 173% more details provided to ACP sampled during the post sampling period. We're also seeing a trend in enrollments for those that have been sampled with samples hep's being three times more likely to prescribe.
As we continue to execute in the field with targeted health care providers, we continue to work on improving patient awareness through our online activities presence in social and digital efforts.
Launch to date, we have over 10 million impressions and this continues to grow month over month.
Our paid search and banner advertising is driving significant traffic to our HCP and patient website.
This campaign continues to outperform industry benchmarks and click through rates and efficiency of the spend.
Thanks to our promotional efforts the website's Virgin money have received nearly 100000 page views since launch our focus remains on reaching many more physicians and patients through engaging and targeted content that conveys important therapeutic therapeutic benefits of chimbote, while simultaneously translating these metrics into sales.
I would like to draw particular attention to our patient support Facebook page and companion web site called <unk> for diabetic Gastroparesis.
These are meant to fill a void in patient education and support for GGP as well as exploring alternative treatments, notably genuity to relieve symptoms of GGP.
We are gaining significant engagement and support of patients through these sites, which allows us to provide a community for patients and provides a forum to address these questions that patients are asking on other community sites.
Mentioned previously.
In addition to providing education directives access to dietitians and guide to help them to advocate for themselves with their providers allows us a forum to share positive HCP and patient testimonials, which are powerful tools to support patient choice.
On previous calls I've shared anecdotes from providers and patients about positive experiences with chimbote. These stories are growing as physicians continue to prescribe and let them samples for patient trial.
There are many stories like the one Dave shared.
A recent story, where a patient which provided a sampling in office patient asked if they could try to sample right, then and there which they did.
After leaving the office to patient callback crying as they felt so good that they decided to attempt to eat the first solid Neil that they had had in months and was successful in keeping that down.
The nurse was so invested in the patient that she too was in tears as she immediately called a representative to share the experience.
We are focused on capturing these patient and provider experiences and sharing them on our website and social channels through represented promotion and in peer to peer programs.
We launched our first physician and patient testimonials with our representatives to use on calls and at the American College of Gastroenterology meeting, where we just exhibited a few short weeks ago.
Early feedback has been tremendous as ACP here the patients experience in here from the ECP, how Jim Moroney has changed his paradigm in treating patients with BGP.
This physician share. These currently switching patients on oral metoclopramide to Genuity and beginning to use <unk> first line.
<unk> prescription of choice for patients with diabetic gastroparesis.
On improving access to your motive ER patient services and savings programs. In addition to working on expanding appropriate access and utilization practices payers. They.
They too have low awareness of the true bernat GGP lack of viable treatment options and how traumatic it provides a significant option for patients.
Encouraged by our current efforts and plans to further support providers and patients in understanding the value of jewelry and I am committed to achieving commercial success with that I'll turn the call back over to date, great. Thanks, Chris.
We're proud to see that our commercial strategy is producing results marked by an increase in organic sales from last quarter rise a number of prescribing physicians and sustained levels of refill rates. Furthermore, the therapeutic benefits of <unk> are validated.
<unk> study results and in practice based on the positive testimonials of doctors and patients.
Our partnership with ever saw that is stronger than ever we are fully committed to the success of our sales reps out in the field and gaming increased traction among physicians everyday.
As we now enter the final quarter of the year, we plan to charge full speed ahead, and we have a strong finish.
Now, let me turn it over to Matt to review the third quarter 2021 financials.
Yet.
Thanks, David once again, thank you all for joining us this afternoon.
Restating the basics of the Arizona grants, Arizona will receive reimbursement of its commercialization cost pursuant to an agreed upon budgets and are only payback through a portion of the revenue additives recognized and received once those costs are covered a restaurant and will receive a percentage of product profits in the mid to high teens, while ago pertains over 80 per.
Sent.
Net product profits or the net sales of <unk> less reimbursed commercialization costs.
Evoke manufacturing invoke administrative costs set at a fixed percentage of net sales and third party royalties.
During the term of our agreement with our designer they have agreed not to market promote or sell a competing product in the United States.
Now, let me review our financial for the third quarter of 2021 results.
The net loss for the third quarter of 2021 was approximately $2 million or six cents per share.
Compared to a net loss of $2 1 million or eight cents per share for the third quarter of 2020.
For the third quarter of 2021 net product sales were approximately $930000 compared to approximately $237. During the second quarter of 2021 then.
The increase in the net sales was due to both the sale to a third party for research purposes and increase in organic pneumonia prescriptions.
FDA approved the <unk> NDA in June 2020, and we began commercial sales in late October 2020. So there were no comparative net product sales during the three months ended September 30th of 2020.
Research and development expenses totaled approximately point $1 million for the third quarter of 2021 compared to approximately.
$2 million for the third quarter of 2020.
For the third quarter of 2021, selling general administrative expenses, where approximately $2.6 million compared to approximately $1.9 million for the third quarter of 2020.
We expect that selling general and administrative expenses will increase in the future as we continue to progress with the commercialization of promoting and reimburse <unk> for the net profits obtained from the sales of pneumonia.
Total operating expenses for the third quarter of 2021, where approximately $2.8 million compared to total operating expenses of approximately $2.1 million for the same period of 2020.
As of September 30th 2021, the company's cash and cash equivalents, where approximately 11.1 million.
We expect our cash and cash equivalents will be sufficient to fund our operations into the third quarter of 2022.
We will now like to open up the call to questions.
Operator.
Thank you I would like to remind everyone in order to ask a question. Please press the number one.
Phone keypad.
First question comes from the lineup Rob Silver.
From a T Wainwright your lines now open.
Hi, everyone. Mrs Mitchell onto wrong. Thank you for taking our questions.
The first one I've got here is I just wanted to wondering if you could talk about the total prescriber rates and how they have been trending and then.
How many of the initial prescribers from <unk> and <unk> 2020 years still prescribing today.
Great question turn that over to Chris Mitchell.
So we evening.
Our our.
New prescribers and totals prescribers each quarter since the fourth quarter.
The.
The number of 46.
To about 383 total prescribers to date.
The number of prescribers that continuing to prescribe is continuing to increase I don't have the actual number of physicians that continued to prescribe what I can tell you is the per cent.
Of prescribers that are prescribing more than once has increased significantly over the.
Quarters to right now a majority of the prescribers are prescribing more than one and we have a subset of positions that are prescribing and multiples.
Okay. That's super helpful and then.
Thinking about the prescriber trend from three Q2, Q the new prescribers.
Slight decreases that does that <unk>.
Largely due to COVID-19 or could you talk about the COVID-19 impact versus maybe other factors there.
Thank you for that question. So I think there is still some some lagging impact from Covid. We know the third wave was actually the entire.
Third quarter I will say that we did despite that increase in the third way, we did increase our reach to physicians and that drove.
Our performance.
Think.
Probably most of the impact is that we implemented our sampling program in of the third quarter.
And we have distributed now probably over 3200 samples those samples are a month supply which is incredibly generous.
And so we believe that many of physicians who.
Wood tried <unk> are trying with the samples and so that may have caused a decrease in the number of new prescribers.
And maybe I could add on okay.
There's one other aspect to that the majority of those samples and the sampling program was targeted at physicians, who had not yet tried <unk>. So that is another rationale as to what might be dampening that first prescription in terms of an actual fill versus they still may be trying just not actually writing as much.
Yeah, the samples are going to be important tool for us and the access.
Two physicians.
Has increased so there is 173% increase in access to those that we have sample but.
Post sampling versus pre sampling.
And then those that have been sampled are three times more likely to prescribed so we feel like the sampling program. Although it created a temporary dampen dampening will actually turn out to be a positive outlet for us.
Okay, that's very helpful.
And then just the last one if I may be 683000 research sale could you just talk a little bit more about that in terms of the contract.
Just any more color there.
I mentioned this is Matt and offer.
So yeah. It is it's a research sale to a third party of course, we don't disclose who that third party is.
In terms of.
Any other contracts associated with that.
Otherwise, we can't say that it's going to be continuing or otherwise, we really don't have any specific information as of yet.
Gotcha. Thank you very much.
Sure.
Thank you. Your next question comes from the lineup deals Jim from Laidlaw Company Your lines now open.
Good afternoon, and thanks, a lot take into question so.
My first question is that the <unk> intends in the third quarter.
The new prescribed.
Revenue upon us prescribed the taste is the result of.
Could you do some breakdown in terms of percentage of between the two.
So.
The percent of.
Total prescriptions versus new prescriptions continues to increase which corcell corresponds to the fact that patients are staying on therapy. So we have patients that have.
Been on as long as 10 months.
A therapy. So the average is around three but.
But what we're seeing is that the percentage of the prescription is being new.
Is.
Is kind of where we need it to be.
Okay, and giving that you have thought of heavy on the sampling projects.
In the <unk>, yeah, a little bit off the meat year.
Would you <unk> would you estimate that the maybe by fourth quarter or early next year. The user experience will increase much more and that will translate to actually.
So so.
Probably those patient. Thank you will upon those patients and physicians.
Yes, I think that's a fair statement. So we do believe that will start to see the impact kind of mid fourth quarter into next year.
And so we are focusing on converting those samples and team prescriptions and so we're following up with the officers proactively on that.
Great and then maybe the last question here is that you mentioned doing your prepared remarks, there was that one I guess Oh, a few physicians that go to treat this as a first line I'm just curious whether.
Full adapt practice are they encounter any sort of pushed back oh from the payroll others or are you guys being able to help to smooth out the reimbursement.
So let me talk a little bit about that particular practice and then I'll talk a little bit about the the payors. So I do feel like that position.
<unk> stands.
The value of Jim Modi, and specifically for patients with diabetic Gastroparesis sees it as the best route of administration to give these pan patients a chance to have a relief and symptoms. So not only is the switching over current patients on medical <unk>. He is starting to write first line.
He is a gastro neurologist.
Any tends to see the patients that are referred even from other guests neurologist for these patients that are difficult like the gas pratique patients.
So he is finding success in getting these covered because he is providing the rationale I was wanting to support it.
I will say that our patient services and hub team is increasingly.
Getting better at getting those prior authorizations approved and that's due to.
Two bringing on new tools and just learning what it takes from the each payer to get that approval secured so we're seeing a couple of different dynamics then.
Okay, great that that's very helpful and I think that's very encouraging as well so keep up the good work and thanks for taking my questions.
Thank you.
Thank you there are no further questions at this time I would now like to turn to call out very back today for closing remarks, great. Thank you as I said earlier this quarter was dedicated to executing on our strategies.
Through our hard work and the value partnership we have with over so we continue to increase in person access to physicians and fulfill strategic commercial initiative to continue to expand awareness and adoption of promoting.
We have an approved product that continues to grow and a large market with no. Other branded products currently the overarching goals delivering your motive to diabetic guest <unk> patients desperately wanting to have a new option to treat this critical unmet need in helping improve their lives. We have cash on hand is support the business.
As we accelerated sales growth will continue working tirelessly to fulfill this mission of helping patients like you heard about today and in doing so helping jamali to further achieve commercial success.
Just wanted to thank our shareholders for their continued interest and support and we look forward to continued reporting back to you all thank you.
This concludes today's conference calls you may now disconnect.
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