Q1 2022 Axonics Inc Earnings Call
Good day, Thank you for standing by and welcome to Axon ex Q1, 2022 results conference call at this time.
All participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session.
Ask the question from that session you will need to press star one on your telephone keypad, he's pretty quiet.
Assistance. Please press Star zero. Thank you I would now like to hand, the conference over to your speaker today, Mr. Neil <unk> from <unk> Investor Relations, Sir the floor is yours.
Thank you good afternoon, and thank you for joining <unk> first quarter 2022 results and update call presenting on today's call are Raymond Cohen, Chief Executive Officer, and Dan Dearen, President and Chief Financial Officer before we begin I would like to remind listeners that statements made on this conference call that.
Relate to future plans events prospects or performance are forward looking statements as defined under the private Securities Litigation Reform Act of 1995.
While these forward looking statements are based on management's current expectations and beliefs. These statements are subject to a number of risks uncertainties assumptions and other factors that could cause results to differ materially from the expectations expressed on this conference call. These risks and uncertainties are disclosed in more detail in <unk> filings with the securities and exchange commit.
<unk> all of which are available online at www Dot FCC dot Gov listeners are cautioned not to place undue reliance on these forward looking statements, which speak only as of today's date May 15, 2022, except as required by law Exxon ex undertakes no obligation to update or revise any forward looking statements to reflect new.
Information circumstances, or unanticipated events that may arise with that I'd like to turn the call over to Ray.
Thanks, Neal and I'd like to welcome everyone. Joining this afternoons call and those of you who may be dialing in later.
We're very pleased with our first quarter 2022 results considering the significant disruption that the omicron Varian had on elective procedures and health care facilities in January and February .
Second on modulation procedure volumes recovered nicely in March and.
And continued to trend favorably and have accelerated in April .
With respect to the first quarter 2022 results Exxon X generated $48 $4 million in revenue, representing an increase of 41% compared to 2021.
Second no modulation revenue was $39.1 million, an increase of 19% year over year. We continue to expect the second on modulation market to expand at least 15% per annum for the next several years with axon X growing its sacral neuromodulation revenue by at least 25% per year.
By market expansion and share gains.
Turning to Bocom, Ed, which posted revenue of $9 $4 million of which $6 6 million was generated in the United States. The remainder of course in the international markets. Despite.
Despite the omicron disruption Bocom had generated another record quarter of revenue driven by strong uptake in the United States from Onboarding, new accounts and solid reorder rates.
From existing accounts.
In the 13 months through March 31 of this year that we've owned this asset bolcom. It has improved the quality of life for over 32000 women suffering from stress urinary incontinence outperforming all other urethral bulking agents and propelling Exxon X into the market.
<unk> market leadership in this category.
Moreover, we are just scratching the surface of what is possible in the large and highly underserved and underpenetrated female stress urinary incontinence market.
As I noted on our call in February and similar to what you've heard from other companies Omicron cases resulted in hundreds of canceled procedures in January and February of this year.
We expect that these cases will be rescheduled throughout the balance of 2022, and we're very encouraged by the business trends that we have seen for April for both sacral Neuromodulation and Bolcom Ed.
And we are highly confident that our updated 2022 guidance, which Dan will discuss in his prepared remarks.
Will in fact come to pass so with that I'll turn the call over to Dan.
As Ray stated Axon X generated net revenue of $48 $4 million in the fourth quarter of 2022.
This represents an increase of 41% compared to the prior prior period sales.
Sacral Neuromodulation net revenue was $39 $1 million, 97% of which was generated in the United States Vulcan.
<unk> net revenue was $9 $4 million of which 70% are $6.6 million was generated in the U S.
Gross profit for the first quarter was $33.2 million, representing a gross margin of 68, 7% compared to 59, 3% in the prior year period.
During the quarter gross margin benefited mainly from higher sales and improved efficiencies and overhead absorption and manufacturing yield higher bulk and add sales and sales of the new recharge free system in the last days of March also contributed to a favorable gross margin compared to the prior year.
Period.
Regarding our supply chain.
Emily to other medical technology companies, we have experienced challenges in sourcing certain components for our sacral neuromodulation system, we've been able to manage through this by sourcing parts from new vendors and paying higher prices when necessary.
Total operating expenses for the first quarter of 2022 were $56 $8 million.
Included in operating expenses are certain noncash items, including $7 $1 million of stock based compensation expense and.
In $2.5 million of intangibles amortization operating expenses totaled $42 million in the prior year period.
Net loss for the first quarter of 2022 was $22.7 million compared to a net loss of $22.5 million in the prior year period.
Cash and cash equivalents were $213 million as of March 31, compared.
Compared to $221 million at year end 2021.
Turning to fiscal year 2022 guidance, our updated outlook is as follows.
Company revenue of $238 million, an increase of 32% compared to fiscal year 2021.
Sacral neuromodulation revenue of $199 million, an increase of 26% compared to fiscal year 2021 and bulk of med revenue of $39 million, an increase of 72% compared to fiscal year 2021.
I will now turn the call back over to Ray for additional remarks, alright. Thank you Dan.
So now what I'd like to do is provide a few updates on product development and our sales and marketing initiatives. As most of you are aware in early March we received FDA approval for our newly developed truly recharge free sacral Neuromodulation system, which we've named the F 15 F.
At 15 sets a new standard for what is possible in sacral neuromodulation at over 15 years, a typical stimulation settings in over 20 years at lower energy settings. This new device has the longest functional life and corresponding labeling of any non retargeting neurostimulator that the F. D. A has ever approved.
Regardless of the clinical application.
Our engineering team was able to accomplish this by optimizing the internal circuitry and employing enhanced firm where that makes efficient use of the primary cell battery in the device.
The fully recharge free system is full body 1.5, and three T. MRI compatible and employs the same stimulation engine is our rechargeable device the.
The implantable Neurostimulator is paired with our time lead and easy to use Fob excuse me key fob sized wireless patient remote control. These system elements are designed to last over two decades Mauro.
Moreover, the patient remote control. Unlike our competitor does not require a communicator, nor does it require recharging or replacement batteries.
Physician response to the introduction of F. 15 has been overwhelmingly positive exon X is now enjoying the benefits having a complete cycle neuromodulation portfolio. We have hundreds of accounts that have been delighted with our rechargeable device and the strong support they receive from our commercial field team. However from time to time those.
[noise] accounts implanted the medtronic interest them to for certain patients that for various reasons, we're better suited for a non rechargeable system.
With the F 15, now available we expect to capture all of the sacral Neuromodulation business in these accounts going forward.
The even bigger opportunity for Exxon X are the competitive accounts that didnt come our way during the last two years as we have previously discussed many physicians have only known and implanted a non retargeting sacral neuromodulation system for the last two decades.
Across the United States, we're selling into these accounts that are that are open and enthusiastic to do business with Exxon X now that we have a recharge free option to offer them.
Our field team is armed with a complete portfolio of best in class incontinence solutions for their customers net net we are confident that the F 15 will allow us to capture an even higher markets excuse me I want to be specific about this statement. We're confident that the F 15 will allow us to capture.
An even higher share of wallet with existing accounts and help us convert competitive accounts.
Our product development initiatives didn't.
Are not stopping with the F 15 approval.
As you know our current rechargeable system needs to be recharged only once a month for one hour.
Our engineering team continues to push the limits of what is possible in this category and later this month, we plan to submit a PMA supplement to the FDA for a new fourth generation rechargeable implantable neurostimulator.
This device, which is the same small five cc form factor will need to be recharged just once every six months for one hour.
We expect this device to be approved before the year end of 2022, and we will begin shipping to customers in the first quarter of 2023.
Now I'd like to spend a few minutes discussing our direct to consumer marketing initiatives.
Over the years, you've heard us consistently note, how underreported underdiagnosed and significantly undertreated adult within continents are in the United States with these conditions in every urology or you're going to college Euro obgyn practices across America. There are hundreds if not thousands of patients that had been differ.
<unk> diagnosed with urinary or bowel incontinence. These adults have been suffering in silence and did not pursue sacral neuromodulation therapy due to either a lack of awareness or because of the shortcomings of the legacy offerings.
To address the lack of awareness, we have been working diligently to make it clear to these adults that these conditions now have an attractive life changing.
A therapy or life changing therapies available to them to take advantage of.
In April we launched our direct to consumer television advertising campaign.
The advertisements started in April airing on television in over 40 markets across the United States and are scheduled to run through the end of this year.
However, during the month of May the the ads are being featured on national TV TV during programs that rate highly with our target demographic.
The find real relief campaign also includes targeted advertising on Youtube Facebook digital radio and various other websites.
So the find real relief campaign is focused on women with any form of urinary incontinence the.
The campaign aims to reduce the stigma associated with these conditions raise awareness of the axon X brand and our therapies and with our assistance help women consult with a bladder specialist.
The ads encourage viewers to visit find real relief dot com, our new patient facing landing page. This website provides information about the Exxon X in continent solutions and direct interested individuals to complete a short symptom quiz in.
In April we had over 100000 unique individuals visit or a patient landing page to learn more about Exxon ex therapy.
Qualified individuals' will then be contacted by a team of nurse nurses in an effort to connect that person to a specialist physician in their local community.
Many physicians have already told us that they are seeing patients in their practice asking about Exxon ex therapy after seeing our commercials on TV.
Certain ads or even on Facebook.
In addition, during the month of April we held three in person physician seminars.
Based upon feedback from attendees. It is clear that these initiatives are resonating with the physician community.
Response to the new product launch on D. T T. A DTC campaign have been phenomenal and physicians can see that we are taking the actions that are market leader should.
We are confident that with hard work and a keen focus on providing physicians and patients quality products, great clinical outcomes and strong support <unk> is making significant progress on its path to market leadership.
In closing.
We remain grateful for the trust physicians patients and shareholders have placed in exon X. We would like to also thank our commercial field team and our colleagues in Irvine for their diligent efforts and dedication to fulfilling our mission of improving the lives of more adults suffering from incontinence.
So at this time, we're happy to take questions. So we'll turn it over to the operator and tee up the first.
Participants thank you.
As a reminder to ask a question you will need to pass star one on your telephone keypad.
That is star one on your telephone keypad children Die Your question press the pound key.
Your first question coming from the line of Adam <unk> from Piper Sandler Your line is now open.
Great Hi, Ray.
Hi, Dan Thanks for taking the questions and congrats on the nice start to the year.
Wanted to ask.
On the guidance first maybe you can just talk a little about the construction of the guidance and quantitatively or qualitatively. What's assumed are contemplated in the new guidance range from the DTC campaign and primary cell at 15 sacral device.
Do we think about that contribution and then I had a follow up or two thanks.
Sure Hi, Adam This is Dan Great question.
No we haven't changed our methodology on how we look forward and prepare guidance and so this is done on an account by account basis looking across each of the territory managers and how it rolls up to the area directors and simply stated.
You know look with the call it the receding Covid line and patients going back to the office and having elective procedures performed I think most companies in medical technology are seeing an increase in patient volumes as are we in addition, with the launch of the F 15 product, it's doing exactly what we expect.
<unk>, which is it's in high demand. We now have a full complement of products between F 15, or 15 in the Balkan mid product line and really everything is kind of going our way and so we increased the guidance just to reflect the latest information on the ground and it's a step forward. So we're being optimistic but we're also trying to not get over our skis and <unk>.
Numbers out there that we don't expect to exceed so hope that answers the question.
Very helpful color Dan.
I appreciate that and for the follow up I'll, just keep it to one here and let others jump in.
On the follow up just can you talk a little bit about new account adds just wondering if youre seeing an uptick in account additions our wins now that you have at 15 in the market place.
And then would also be curious just to get a flavor for the mix between the systems rechargeable and Nonreturnable.
Where are we today a couple of weeks or maybe even one month kind of post launch and how do you see that trending.
Over the course of 2022.
Sure Adam. Thanks. Thanks, Thanks for your comments and the question is it's another good interesting question. So thanks for that.
Okay, you've yet to kind of a two part question so.
One is are we seeing competitive.
Competitive accounts coming our way on the basis of this new product offering and the answer is absolutely yes.
I mean, I think all one has to do is go look at Linkedin.
To get a sense about.
How many of these customers are using this new product for the first time in.
A high percentage of those people that are appearing in those linkedin posts are brand new customers to Exxon ex these are folks that have been resistant.
All along.
Because we only had the rechargeable system.
We don't have an exact number to share with you today about how many new accounts. There are I think over time, we might be a little more comfortable sharing that maybe when the end of this quarter concludes but you know it's it's multiple dozens let's just leave it at that right.
This is not one or two right. These are dozens of accounts that are coming our way now because of that and then you asked.
I'm kind of smiling because you asked well what about the split and you know my answer today is going to be the same answer that I gave the last 20 times that it was asked which is it's about 50 50.
And you know on any given day, it might skew slightly one way or the other but that's about it and I think this is really important to point out that.
You know, where we're able to accomplish two things with this new <unk>.
Primary cell or recharge free or non rechargeable system. However, you like to refer to it.
Most importantly, where we are closing the hole in the bottom of the bucket.
So for existing accounts that we've been working with who who've had some patients for various reasons that are not suitable in the physician's mind.
For a rechargeable system, we're getting that business today.
And that matters and you know we're we're excited about that.
And then of course, you know in new accounts coming our way who by the way they may start working with us on the.
We charge free system.
But once again that rechargeable product that we have is very attractive I mean, it's nice small product five C. C. So anybody concerned about body image you know theyre going to take advantage of that right now once a month for an hour is no big deal to recharge. This product, it's not like a spinal cord stimulator that you've gotta recharge every day and it is a.
<unk> different kettle of fish.
And then also the rechargeable product is not.
Impacted.
By the quality of the implant or the or trying to work really diligently to get a low amplitude implant that is going to be directly correlated to the life of the longevity in the body of a non rechargeable system. So that's a guarantee we've got labeling it says at least 15 years in the body and we've said all along.
Long and we fully expect a rechargeable stimulator from Exxon X is going to last over 20 years. So you know there's that's a guarantee there we have unlimited power. Their idols you have to do is recharge the device simple as that so.
This is a great. New addition to the product line.
It's going to do wonders for us in terms of increases in revenue as a company and getting us into more accounts than we've even been before.
But it's not as if all of a sudden Exxon X has changed its stripes.
And turned into a company that is only promoting a non rechargeable product I think it's important to get that message across.
You know were real strong believers that.
Our rechargeable neurostimulator, particularly in a small one.
Is a very attractive product to offer to patients.
That's great color Ray Thanks, again for taking the questions.
You bet. Thanks, I appreciate that.
Your next question is from Cecilia furlong from Morgan Stanley . Your line is now.
Open.
Hey, good afternoon, and thank you for taking my questions.
And I wanted to start with bulk come in and just if you could talk to really the strength that youre seeing from current account reorders versus continued new account openings.
And that's one of them into your outlook around new account contributions contemplated in your guidance. How you would really at this point frame, where you are along the path to longer term target penetration across U S accounts.
Yes. Thanks.
To see that.
That's a good question.
So.
Bulk of it is a phenomenon onto itself.
I mean, it's it's.
I mean I've been at this I think over 40 years now in this game and to be honest with you I've never seen a product that has moved as quickly and been adopted as quickly as woke of Manhattan.
So you say what are the reasons well women don't want slings, Okay. What what you have stress urinary incontinence, okay. Your cough or sneeze. You you you do some exercise you leak a little bit of urine does that give rise to wanting to go in to have surgery.
We all know that it's not a free sling operation is not a free lunch is it effective yes.
Are there adverse events, yes.
You have to take time off from work and have recovery and all of that yes, Bocom. Ed is something that you is presented and the vast vast majority of women are saying, yes, I'll try that a hydrogel. That's biocompatible that's going to last 567 years in my body, that's been clinically proven and used over a decade and so on so forth.
People are saying, yes to that.
So to your.
Question right.
You know once you once you get trained on this product and you've acquired you know.
One or two scopes youre ready to go.
You know, we stack up some patients on the first day or the first week. So that we get make sure you're doing the right thing and you're comfortable as a physician, making these injections and then it's we don't need to be there. So there's no. There's no heavy lift in terms of follow up or case coverage as is the case with taken a modulation.
So the reorder rates are strong and you know we just won the account is opened and they've been trained up but we just get orders. They just send the purchase orders and we ship the product simple as that.
And post the revenue and I might add you know the margin on that product is really nice and it's actually better than what we had even estimated so we got into the above 70%.
Margin here.
Which are we even picked up.
You will read in our.
News release, and other things that we picked up even a couple of points because of the.
Currency exchange in this particular quarter, so anyway, but.
But we haven't gone into saying well here's how many new accounts that we have in here is the reorder rates and we just havent, we havent disclosed those kinds of analytics because quite frankly, it's still early in the game. We we've earned this on this asset now for I think we're at 14 months.
And you know where we're just out there you know doing the work every single day.
So, but it's fair to say that these are you know hundreds of accounts that have signed up with us. During this period of time I mean, not just one handful multiple handful hundreds of accounts.
We're continuing to add new bulk of meta counts literally every single day, we're adding.
Bocom it accounts, but more importantly, the level of satisfaction from the existing customers and the results that they're seeing immediately right imagine a patient comes in they they're they're they're leaking under those conditions and then they get these injections and in 15 minutes later, they stand up they do a cough test in there.
Dry that's a phenomenal phenomenal experience for both the physician and of course for the patients. So I know you'd maybe prefer if we gave you a bunch of numbers.
And so forth, but we're going to only give your soft comments today things are going ridiculously well it continues to meet our AR to exceed our expectations. This.
This is part of the reason, we've even upgraded the updated the guidance here.
And I think this is this is a product line that has a lot of legs for us and far exceeding.
Even the expectations that we set forth when we acquired the asset right. So.
I'll leave it at that if you don't mind.
Okay No I appreciate all the color and.
If I could follow up just on your commentary around the supply chain. If you could just walk through a bit more what youre seeing in the field today either any recent shifts are easing and then as you think about just from a gross margin standpoint potential offsets you have either from the recharge free platform launching boeckman contributions just really how youre thinking about gross margin.
And through the balance of the year across all of those factors.
Sure.
I'm, just going to make one or two comments and I'll pass it to Dan.
You know look the good news.
For our company is that pricing is really stable I mean, we've got the same asps.
Literally now for a couple of years since we've launched the product in the United States in 2019, So that's the good news.
You know, we get nicked up a little bit here and there.
No because things are coming out of stock or you've got to pay a little bit more for this component or whatever.
Its a fire drill in every single day, it's a different thing that you got to try to address so that that's reality, but that's the business that we've chosen right and these supply chain issues are annoying, but you just got to work through them.
Once again the good news is that prices are stable F. Fifteens got a better cost of goods profile for us so that contributes to increasing gross margin and once again bolcom Ed.
Got stable prices and we got really nice margins and then we had that little pickup.
From the.
The Euro dollar exchange, so with that said I'll pass it to Dan and he can speak about what to expect going forward.
Sure. So now that the comment about supply chain was because we wanted to be prudent and not just not say it and so I think like.
Probably most every medical device company in the industry, we've all seen certain components, whether it's a park city or a resistor capacitor get swallowed up by some wholesaler raises the price on you but nothing.
Nothing that I would deem material, but I just wanted to you know we called out that we've addressed it by paying higher prices, where we have to and in some cases, placing large purchase orders where there are components that have long lead times. So we haven't had any manufacturing stock out issues as a result of supply chain.
But given everything that's happened with Covid, we felt it would be more prudent to mention other than to just say nothing about it. So that was really that you know as far as race commentary on the margin is correct, which is <unk>.
Despite these little Nicks that we get where we might have to pay more for a certain component. The reality is we're manufacturing in larger scale than we ever have before as time goes on we get better they're more manufacturing efficiencies better absorption of overhead and so we have a really tight control on our cost of goods salt and so we had solid margins for the <unk>.
Carter, we expect them to stay in that you know call. It high sixties range throughout the rest of the year I don't want to oversell, it because I want to point out that yes, we just launched a new product. The F. 15 that has a higher gross margin profile than the current rechargeable product, but by the end of the year will also be built.
Inventory and getting approval hopefully in launching our next rechargeable device and so anytime you have these shifts in product mix. It does tend to move your margin around a little bit of point up or down one way or the other so we're in a very good place it's tracking perfectly according to plan and you've only heard me say this 250 times.
At scale, we expect margins to be in the mid seventies.
Great. Thank you for taking the questions.
Thank you Cecilia.
Your next question is from the line up.
From Wells Fargo, you May ask your question.
Hi, This is Nathan on for Larry Thanks for taking the question.
My question is more around the primary so see you launched your device around the same time that your competitor launch their next generation primary cell device.
Would you give any color in terms of what dynamic have you seen in the market and given both of you have launched your products and what have you heard from physicians regarding your product versus your competitors. Thanks.
Well.
You know I would say.
Yeah.
There are there late in the dollar short okay. That's how I'd sum it up in terms of our competitors are inter stem X, which is basically some upgraded electronics inside inside the exact same form factor.
So I think that's the most obvious thing second thing is they didn't do anything to improve the patient experience when it comes to the patient remote control system, where they need a communicator. They have multiple items complicated all need to be plugged in the wall to get recharged otherwise you can't communicate with the device. So you know when it comes to the pace.
<unk> experience they've done really nothing too to help that situation. They are indicating that the device will last a little bit longer in the body. So as opposed to a you know average four year.
I mean, I'll quote the exact clinical.
From clinical papers for four years on an average for interesting too. They are basically saying that on average you can double that and get eight to nine years, maybe 10 years under under some really great conditions.
Our device on an apples to apples comparison, if they can get 10 years out of that device under those conditions, we get 17.6 years.
And we can get over 20 years, if the if the physician does a good good implant with low amplitude.
Energy requirements.
So we've got a significantly easier to use product.
We also I dare say have a validated.
Stimulation.
I'll call it algorithm alright.
Because it's using the same engine that we have in our validated rechargeable product, which is which underwent a PMA IDE approved clinical study we use constant current stimulation we used it in a rechargeable we're using it in our non rechargeable or recharge free system. It's the same engine it's been clinic.
We validated and I'm going to make a strong statement. There are no products sold by our competitor today that are clinically validated.
They have switched from a voltage control system to a constant current system, but theres no data out there to to to underscore.
The efficacy of these devices. So we've got a lot on our side, we got a validated product with strong efficacy with longer lived and easier to use so based on that I can tell you that the average physician who sees this disease. These facts I mean, theyre coming our way I mean, that's the bottom line and.
The words out also you work with Exxon X is a different experience every case gets covered you get phenomenal support from the company you got patients that are completely satisfied our mantra is no patient left behind right. We actually are doing things to make sure people are having a good experience. So I think it's the entire gestalt right of what we're up to.
<unk>.
We want to do apples to apples comparison, we can do it there's no question.
It's a fact Medtronic had 23 25 year head start on Exxon X, but man, where we're gaining ground and I Dare say, because I've said it all along we're going to be the market leader in this category were determined we're focused we got the goods and we got the people and we got the feet on the street and we've got excellent momentum.
<unk>.
I think that any level of investigation that anybody does surveys individual conversations.
Or just looking at the numbers I think it's going to be really obvious.
That if any physician wants to.
How should we say attach their wagon to a to a certain a horse it's exxon ex not not the legacy provider.
Okay. Thank you for that well just sticking to that subject I guess, so we estimate that <unk> currently has 20% share of that market and about 40% of the rechargeable market.
You think you could capture a similar share of the primary cell market.
So I appreciate your question and I'm going to sound like a broken record because there aren't two markets here.
This is a this is a spreadsheet fantasy okay. There's there's a doctor and then theres a patient and that Doctor is going to present, whatever he thinks is appropriate to the patient or give the patient a choice and then theyre going to choose they're either going to use a rechargeable product or a non rechargeable product based on a number of.
Conditions that the patient and the Doctor is going to decide amongst themselves.
We haven't we're not influencing those decisions.
So.
And I don't want to debate the percentages.
Of market share because you only have one number to go by the our competitor has not released fresh numbers and how many years now right. So.
I just don't know what that what that answer is I can give you our opinions we think it might be this or that but our objective is to be the market leader that means we will not rest until we are shipping 51% of all the sacral neuromodulation stimulators that are being put in patients in the United States.
I'll leave it at that.
Great. Thank you.
Okay.
Next question is from Mike Matson from Needham and company. Please go ahead.
Yeah. Good afternoon, thanks for taking my questions.
I guess first Dan I appreciate your earlier comments on gross margin and maybe I missed it but I know you don't give specific guidance, but can.
Can we kind of expect it to stay at that 68, 69 kind of level for the rest of the year or should it get even better from here over the next few quarters.
I would here's here's my take on it which is when we look at the numbers when we look at what we're expecting in terms of internal estimates on product mix and build plans I think you know we had guided earlier to I think it was 66 point to that.
The analyst consensus.
I think it's fine to stay in the 66.2 to 67, 5% for the remainder of the year, but I don't want to.
Oversell, it and have anyone pushed at the end of the seventies, because we have so much going on.
Yes, I understand that's helpful.
And then.
Wanted to see if you could give us an update on your sales force.
With the launch of the F 15.
Had an opportunity to maybe add some additional reps or.
So Mike. Good question look we have worked diligently in the latter part of 2021 and the early part of 2022 to.
Let's just say.
Complete.
The expansion of our field commercial field force.
Between our territory managers.
Our sales managers and clinical specialists, we have approximately 320 people in the United States that we would consider you know feet on the street and it's pretty much a mix its almost.
It's almost exactly half and half in terms of.
Quota carrying representatives and clinical support individuals.
We feel comfortable with that number.
We don't believe that we need to add additional heads in 2022 to exceed.
The consensus.
And we honestly don't believe we need many more people in 2023, even with the significant increase in the revenue. So we feel like we're fully staffed right now.
And of course look theres going to be a little bit of turnover, you know and all those kinds of things we have to do some back filling but other than that and we've done the work.
Mike One thing you've known us from before we went public right. When we hired 135 people to market our products in the United States without FDA approval. So we have always been ahead of the curve.
And we think that's the right place to be while we're in this big growth mode.
The good news is that I think we've got an excellent team there, they're all well trained and I think we're really in good shape and this is a big team now I mean, we got a we got a big team there's not one place.
In the United States.
In the on the Continental United States or even in places like Hawaii, and Alaska that debt that were not present in that we can't support cases, so sorry for the long winded answer, but I wanted to give you a little color about how did we get to where we are today and we don't.
We anticipate the question about well what about the next the rest of the year. So.
We're in good shape.
And we feel good about the quality and the size of the commercial team in the United States.
Okay got it that was very helpful. Thank you.
You're welcome Thanks, Mike.
Next question is from David risk, Scott Fancher with Sidoti. Your line is now open.
Hey, guys. Thanks for taking the questions and congrats on the quarter.
First I guess from you know in the past I think you've talked about how the bulk of that.
Essentially a door opener to some of these accounts.
Accounts and you've provided some updates on that in the past, but you posted I guess Q2 or three someone who's seminar so far with the new recharge.
Recharge free device launch and so I guess you get a sense at this point.
Whether or not maybe some of these seminars would that would be <unk> accounts are even starting to bring in bringing some some new bulk and that accounts.
Yeah and look at it works. Both this is the beautiful part about it right. If these products are totally synergistic.
Even even from the patients they just look at it from the patient standpoint.
Great you know, what I'm going to give them a chance Ah on cycling modulation and then in the other side, it's like a lay down right. I mean, we got an existing customer who's been working with us and now we have a product to treat stress urinary incontinence patients they're like <expletive>, we already know how what it's like to work with Axonics and we're happy to bring that new product.
And so it's been working both ways for us existing customers adopting bolcom, Ed customers that never worked with us adopting bolcom at as a door opener and then ultimately coming our way with sacred no modulations. So.
It's done you know when we first acquired it we made certain statements about what we believed we thought we were optimistic we anticipated right that this might have this effect while the reality is the effect has been significantly better.
And more advantageous to Axonics, then we could have imagined and you know look at.
We do the best that you can write you acquire a good asset integrate it get it out to your customers as efficiently as possible, but in the end of the day you know if the products not great people aren't going to use it in this case, our product has exceeded people's expectations, and we're seeing bolcom Ed now become a.
First line therapy.
For patients who have stress urinary incontinence and what we're hopeful is now that with these long lived MRI compatible highly efficacious sake, when no modulation products that segment cycled.
Cycled sacral Neuromodulation will quickly move from a therapy of last resort to something that a doc is comfortable with and he wants to pull it out of the bag early now obviously, we're not gonna depend just on physicians to do this that's why we're going directly to the consumers and we're letting them know leaking your.
Is not normal and.
And if you've got this problem, we can help you and if and if you've noticed if you happen to see the ads or.
Have have have have have any sense about what we're doing this as a branded campaign. This is about axonics therapy, we don't talk about sacral no modulation, we don't talk about bulk commit we don't talk about stress urinary kind of we just the ads are from a real patient, saying, Hey, if you've got this problem I had it.
I was just like you I found Axonics and now my life is significantly better I encourage you to go to find real relief Dot com and and go from there. So that that's the that's the whole shtick.
Okay. That's helpful. I guess, just the second one from us.
I appreciate the commentary provided just around the recharged free lunch, so far but I guess could you maybe provide some some colorado, maybe what a typical account or where you're seeing some of the implants coming in from.
A lot of us coming into maybe some Exxon next you know typically heavy accounts that were waiting for a recharge free product were you. Even are you seeing kind of some share gains within accounts that maybe are heavy from the competitor that you are now able to offer the recharge grief product and then therefore, even pulling some of the other charcoal products as well.
Yeah, that's a good question.
We may not have answered it explicitly but.
I'll say the following.
When I refer to closing the hole in the bottom of the bucket I'm talking about 10 or 15%.
The procedures right or you know what I mean, a relatively modest amount of business that we just weren't getting from our existing accounts.
Some <unk> some accounts that we have had a good majority of them. There are 100% there are 100% Axonics. They had no interest in ever working with the legacy provider ever again, but in some instances some of those accounts still gave some business to our competitor just because.
The patient May have had one in their body before and it was working okay and.
Or maybe the patient gained an extra 150 pounds and they didn't think that rechargeable what is a good idea because it couldn't reach around.
Or any one of a number of things.
But that's a measurable uptick.
Getting a.
Brand new account that we've gotten zero business added before I mean, that's that's that's a whole new ballgame for us right and that's really exciting and we have literally dozens and dozens of those counts that have come our way literally in the first six weeks.
Launch of the product and we expect that to continue because.
A we have a number of these institutions that since we never did business with them before.
We don't have a contract yet.
With that institution. So we're still in the process of gaining getting contracts with.
With some of these institutions that we've never worked with before so yeah, there's interest and there's demand, but we haven't even been able to fulfill it yet.
We also have to have an addendum added to the existing agreements that we do have with our own customers well. Once again you know it takes time to work through this this kind of paperwork process. So these are the.
Kind of like the operationalize side of this business that there is always a bit of a.
Timeline or a time lag before you can fully appreciate the benefit of a new product launch like we have so we're working through all those details.
And I think people are will be I daresay impressed with what we posted in Q2.
And and going forward because it's just.
I mean, it's a funny thing we've had success clearly.
You know.
Being ranked the number one fastest growing company in the Americas is no small feat, we're proud of that but our view and the management's view here in our employees of the company is we're just getting started and.
And now for the first time in two years, we actually have kind of a open playing field in terms of elective procedures. So you know this is this feels really good to us that we're we're not having to compete against Covid and I've said it before COVID-19 has been the hardest competitor than anybody could.
Could ever imagine so when we get elective procedures back on and things from people are comfortable to go in and get procedures done again and all the rest of it it really gives people an opportunity to go out there and show what we can do so we're obviously quite optimistic and bullish about the prospects.
And now we actually are able to actually go out in the field without one hand tied behind our back because of Covid and the other hand tied behind our back because we didn't have a recharge nonrechargeable system. So we're you know we're feeling pretty good.
And if you get the sense for me hopefully I'm not overstating. It I mean, we're we're bullish and we're really excited about what we can do now in the next three quarters of 2022, and obviously and then in twenty-three with now I mean, it's a funny statement, we're going to have a rechargeable product that you hardly ever need to recharge. So.
That should be one hell of an attractive product for the marketplace in 2023 as well.
Very helpful. Thanks again.
Thank you.
Next is from.
Pulling back from all for you today.
Your line is now open.
Hi, good afternoon, a lot of color I only have one question it sounded like a yes, but consensus <unk> revenue $59 million give or take is that a.
Appropriate framework sequentially.
I almost want to ask a question to your question.
Oh.
I mean it is what the analyst consensus is are you asking me to confirm Q2 numbers Mike.
And does that yet I haven't heard any specific sequential commentary about revenue aside from the prior reply, which there there there there we think will be impressed by the numbers.
I'm trying to I'm sure yeah.
Yes, yes.
Ask you about timing and all the rest of <unk>.
Think what we what we did is we.
We basically have just reiterated.
The earlier guidance, we added just a little bit you know.
To it and the pace at which the analyst community had assumed.
I think is fine going forward. Our objective is to beat I'm going around your number up to 60 million right. It's 59 and change our objective is to beat that number.
Our objective every quarter now Q1.
Was obviously challenging quarter, because we had the external factors that nobody could have predicted in terms of the the the the COVID-19 wave that hit us all in January and hung around through February so unless something weird happens now I mean, you know.
And God knows there's been a lot of weird things happening in the world. So you know.
But in terms of the business.
We feel really good about it and our objective is to beat those numbers and Q2.
And so we're not moving things around in terms of the cadence for the balance of the year.
Sounds good thank you so much.
Thanks I appreciate it.
Your last question is from Daniel.
Your line is now open.
Hi, guys. This is pretty on for Danielle. Thanks for taking my question and I guess, if I could ask one and you guys continue to make investments on the BBC Fry.
Sense of how many patients appreciate the color of 100000, new patients in April to visit your patient landing at web site, but.
That was you were contacted by the nurses do you have any sense on how many are actually gang.
Is there any other metric that you guys can track to see how the T. T. C efforts are are going and I guess, a little bit of a <unk>.
Follow up now for those patients who are interested but aren't getting implanted what are some of the barriers.
To implantation. Thanks.
Okay, well that's an interesting question. Thank you for the question.
So let me.
Let me, let me push push aside the.
What are the barriers, okay just for a moment.
In terms of the.
Response to direct to consumer advertising you have to start with.
Many people are actually going to find real relief dot com that that's the point number one.
I.
Didn't talk about impressions.
Probably because.
I'm from a different generation. So I don't know how to I don't know how to count impressions and I don't know what they mean okay.
Cause that's in the millions.
But what I do now is 100000 people took the time to go to the website and too you know.
Register themselves so to speak right.
The key thing is that we want those individuals to fill out the survey and then we can contact them and then we can understand where are they are they early in the care pathway or they late in the care pathway and can we get them dropped in for a consult with one of our providers. Okay. So that's the game.
That were up to right now there's a lot of ways in which will be able to measure the results.
Of this campaign.
Beyond the fufu.
Fufu stuff about you know unique visitors impressions unique visitors survey responders and all that stuff, which is ultimately how many of those patients wind up getting an implant right. That's the business that we're in or injection of bulk emit.
And the way, we the way will fundamentally do that in particular for Synchronal modulation is when patients enroll.
In the process do an external trial, they give permission for their data to be put in what we call our patient care manager. So the fact is that that data is going to sit up there in the cloud and then what we do is we basically match the actual patient who.
Who got an implant with the person who responded to an AD now you can imagine that's a process and it takes time and this lag times and all these other kinds of things so.
Yeah, I can give you anecdotal stories.
We're docs have even come up to me and this seminar recently in Denver last weekend, and say Oh I got two patients already from the find real relief campaign, and then I've got two external trials and one's already been implanted you hear that kind of stuff, but ultimately you know one off anecdotal stories.
Does not in Roy make okay, and so we're gonna be tracking this stuff, but its way premature.
222 really for us to be able to report in any meaningful way on what this is about.
What we said is that we've earmarked some pretty good dollars for this campaign, we're going to run this campaign.
Pretty much for the balance of the year I think the early indications are very good I gave you a number for April will turns out that the pace of visitors in may is significantly higher than it even was in April . So maybe 100000 last month in April we may see 200000 people.
In the month of May. So these numbers are starting to increments quite nicely in terms of the response, which just underscores the fact that no one knows about any of these therapies. It's big secret right. So we're trying to change that and it's gonna take some effort and it's going to take a bit of a lift.
And some money for us to invest to make that happen, but I assure you and we said this all along.
In particular, Dan and myself and the rest of our senior management team where operators.
Okay. We're we're not social media geeks, right, where operators so everything that we do we try to operationalize on the backend right. So that we understand what's happening what the RLI is and where to apply our money judiciously and that's our objective. We we've got you know a good amount of cash we understand that cash.
From our shareholders and we're gonna husband that cash and we're going to act as responsible stewards on behalf of our shareholders and that's really kind of the best the best that I really could say about that so we're excited about the response.
It really is a new day there is a renaissance that is occurring now and if we can get this conversation so that it's no longer in the dark right that people are comfortable talking about these conditions. Knowing now that there is a solution and let's face. It people don't talk about problems unless they are solutions to the problems and that's what we're trying to do.
Influencing one person at a time here.
And so forth. So it's really an exciting time.
And I Dare say this is great news for patients and for people in America, who have been suffering in silence with these problems and we want to get them.
To come out.
And give us a chance to help them all right now why don't they what happens.
It's human nature, it's just the inertia.
Have to take specific action they have to be bothered enough to want to take the action they need receptive caregivers on the other end right. So there's logistics involved we may have gotten a patient dropped into a particular physician's office, but once again, we don't run those practices.
So we we work hard with them to say, if we drop a name of a person who's interested who wants to come in for a consult your staff has to call those people and get them on the calendar.
None of this Oh, we're busy three months from now I can get you in for a consult right. So you can see that there are ways in issues that you have to overcome in terms of the.
Organization in these practices right.
Face it the medical can be of no secret if I say this the medical community is.
The best business persons on the planet no. So we do what we can to help them, but in the end of the day, they gotta get people schedule. They gotta get him in the door, they gotta figure out where they're at and what their problems are headed differentially diagnose them and then ultimately offer these treatment. So it is a process.
And it is going to take some time for us to reap the benefits just because of logistics. So.
And then Y a patient would not pursue once again it just depends on each individual is going to have to make their own decisions about their level of comfort.
Trust in the physician provider across the table and that conversation so hopefully that's.
Color at least to give you a sense about how we see it and how we're thinking about it and what we're trying to do.
All in all it's been overwhelmingly positive and so we're we're thrilled with the initial reaction to the campaign and it's giving us.
Motivation to continue.
And and to get more patience and the last thing I'll say as you can imagine.
The response from the physician community I mean here axonics, the new entrant into the marketplaces actually now doing things.
To help them get more patience and the practice and help more of their existing patients get access to these therapies. So thank you for your question very much appreciated.
Yeah Super helpful. Thanks for calling me that's all for me.
You bet. Thank you.
Does that answer your question and answer session.
I'll call back over to them and Conan.
Thank you. So thanks, operator, thanks to all the analysts for your questions. We certainly appreciate it always gives us an opportunity to add a little more color to the prepared remarks.
And so we thank you for your continued support and we look forward to.
Talking to you again in early August .
Take care have a good evening. Thank you.
That concludes today's conference call. Thank you all for Ya.
You mean now disconnect.
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