Q1 2023 Impel Pharmaceuticals Inc. Earnings Call
Okay.
Good morning, ladies and gentlemen, and welcome to Impel Pharmaceuticals first quarter 2023 earnings and business update conference call. At this time all participants are in a listen only mode. Later in this call a question and answer session will be conducted and instructions on how to participate will be given at that time. As a reminder, today's conference call is being recorded now I would like to turn the comps.
Over to Npls, Chairman and Chief Executive Officer, Mr. Adrian Adams Mr. Adams. Please go ahead.
Thank you operator, and good morning, everyone.
We are delighted that you could join US today for <unk> Pharmaceuticals earnings Conference call to review, our first quarter 2023, commercial and financial results as well as to provide a general business update in addition to highlighting the key priorities for the remainder of 2023.
John It from Intel This morning is lung parity law, our chief commercial officer.
Rajeev I mean, our corporate controller.
And our new Chief Financial Officer, Michael <unk>.
Michael brings to empower and outstanding track record of executive leadership in finance capital raising business development and operations management and we're thrilled to have someone of his caliber and experience join our leadership team at this critical phase of our evolution.
Before we begin I would like to remind everyone that we have a slide presentation to accompany our conference call. This morning, which can be viewed on our website at www Dot impel farmer Dot com.
If you are listening to this call on your telephone you may access a synchronized slide deck on our website by choosing the link on our webcast page that says click here to listen.
I would also like to remind you that during this call. The company will be making forward looking statements that are subject to risks and uncertainties that may cause actual results to differ from the results discussed in the forward looking statements.
Now I would like to turn to slide number four where I'll summarize our first quarter and year to date performance with Prudential.
Firstly I'd want to remind everyone of the tremendous opportunity that exists within this large migraine market.
This is a market growing 10% year over year, and becoming increasingly brought it with most of that growth coming from newer non trade options.
Within this market, we have adopted a highly targeted commercialization strategy with a current sales force focus on 11 hours on target positions metal predominantly neurologists headache.
Headache specialists and high prescribing primary care physicians together this target group generates 73% of all.
All branded prescriptions.
Our journey with <unk> continues to make consistent progress and we.
We are pleased to announce first quarter 2023 revenue of four 4 million driven by strong end market demand of over 18000 normalized prescriptions over 70% of which were reimbursed.
Our key leading indicator of new patient starts were up by 18% versus the fourth quarter of 2022.
This momentum towards stable prescription size of six pulse per prescription.
Solid and high filler repo rate in the low 60% range and an expanding prescriber base.
These achievements to date form a solid foundation for continued growth as we move through 2023.
With that said lets now turn to slide number five to begin our commercial performance review with you in more detail.
As mentioned on the left hand side of this slide we are the largest short continued robust growth in new patient starts reaching over 3600 in the first quarter, an 18% increase versus the fourth quarter of 2022.
Now looking at the right hand side of the slide you will know the momentum shifts two distinct time periods are first is like in the third quarter of 2022 was our field force expansion began to take hold and the second is the post holiday period or more specifically in March and April .
2023.
This latest surge in new patients to provide us with additional compounds into decelles momentum as we move through the second quarter of this year.
Turning now to our next slide slide number six.
On the left hand side of this slide you will note that consistent quarter over quarter growth, we saw throughout 2022 today.
To date, we have generated just over 25000 prescriptions more than 100% increase versus the same time last year.
A significantly high in that price.
In the first quarter of 2023, we did see a small pull back a normalized TR axis. However, this was not surprising given normal first quarter dynamics with all products like deductible resets and reauthorization.
Moreover, we added to this unit pressure by proactively making targeted adjustments to our quick stop free goods program.
These adjustments, while producing a higher net price per prescription did have an impact on volume.
Please now refer to our next slide slide number seven.
As mentioned in previous calls given our targeted and disciplined approach to commercialization. We believe the most appropriate way of measuring our success over time is by market share evolution within our targeted group of physicians. Therefore, we are delighted to see continued market share evolution.
<unk> already reaching four 7% sure among prescribers of <unk> in the first quarter of 2023, just 18 months into a launch of traditional.
Driving depth of prescribing among our high value prescribers, a larger proportion of whom on neurologists is a critical success factor for continued growth in 2023.
You'll note the significant share gains amongst our top prescribers, who now are true lessor accounted for seven 6%.
<unk> branded prescriptions a tree.
We assign that with continued investment and focus we believe that <unk> can achieve a 12% share predicted by neurologists and independent surveys.
Please refer to our next slide slide number eight.
You'll remember that we secured key pbms and payer contracts quickly after launch in 2021, securing 80% of commercial lives under contract in just the first quarter of launch.
This enabled consistent improvement in the percentage of prescriptions reimbursed over the course of 2022, peaking at 60% in the fourth quarter.
Now in 2023 with established payer policies, we have taken steps to tighten the business rules associated with our free goods program and a <unk>.
The percentage of prescriptions reimbursed jumped from 60% in the fourth quarter of 2022% to 72% in the first quarter of 2023 with continued momentum and improvement to 75% in April .
Importantly, our repo rates have remained consistent and solid in the low 60% range.
This increasing reimbursement together with higher refill rates provide a solid foundation for meaningful revenue growth in 2023.
Turning now to slide number nine we continue to monitor the favorable market dynamics and source of business was to desktop.
<unk> data continues to show that a very high percentage of patients around 60% on G pumps, specifically checking your belbin drop off or switch away from these products at some point in therapy.
Given the Tolerability of these products. It is all contention that the primary reason for this continued journal with GE pounds is a.
Drivers under the patients are not finding the rapid sustained and consistent efficacy. They are looking for in our acute migraine treatments.
This journal in the market opens a large pool of eligible patients and more specifically a significant ongoing opportunities which are desktop.
The source of current business, but to desert remains diverse with approximately half of neutral desperate patients switching from a trip time and a half from a jeep.
We also note that <unk> is most often amit to existing therapy as an efficacious reliable.
Oral option.
Turning now to our final slide in this commercial section slide number 10.
It is against the backdrop of this growing branded market, where so many patients still seek efficacy that we are launching our new targeted DTC campaign cannibalize.
The campaign highlights the common challenge patient space, when taking oral medications efficacy is often dependent on taking pills.
But unfortunately lack does not always allowed that we demonstrated in our phase III stop 301 trial <unk> ability to deliver efficacy even when taken late into an attack.
Past 18 months, we have patients relate with tremendous impact on their lives.
We're excited to bring these authentic experiences directly to patients.
Key social media platforms and influences raising the awareness of what good versus great looks like in the treatment of migraine.
2023 is off to a strong start and I'd like to take this opportunity to supply all of our talented patient focused and dedicated team members across all of the NPL functions for their continued professional and successful contributions.
I would now like to provide a brief overview of our financial results for the first quarter of 2023.
Please refer to our next slide slide number 11.
The net product revenue for the first quarter of 2023 was $44 million versus $1 8 million for the same period in 2022.
This increase is due to higher <unk> sales volume and improvements in net price realization.
Research and development expenses for the first quarter of 2023 was $3 million versus $3 7 million for the same period of 2022. The decrease is primarily due to decreased personnel costs and program costs as we redirected our resources from R&D activities.
Pivoted, all folds to supporting our commercial operations, rather than research and development in the first quarter of 2023.
Selling general and administrative expenses for the first quarter of 2020 were $22 million.
Which compares with $19 8 million the same period of 2022.
The increase in SG&A expenses. During 2023 is primarily due the ramp up in spending to support commercialization.
For the first quarter of 2023 empower reported a net loss of $30 1 million or.
A $1.27 per common share compared to a net loss of $27 million or $1 17 per common share from the same period in 2022.
And finally as of March 31, 2023, the company had cash and cash equivalents of $35 5 million.
Related to this we have ongoing discussions regarding additional capital and are optimistic of sharing progress in the near term.
We're not lots of calls with our final slide slide number 12, which provides a summary of two desperately poor performance in the first quarter and year to date 2023. In addition to outlining our ongoing priorities for the remainder of 2023.
After a solid first full year of commercialization for Investor in 2022, we remain pleased with the continued performance of investment in the first quarter of 2023 and in particular with the strong growth in new patients and importantly, net price evolution.
The lead indicators of growth catalysts are providing excellent momentum as we journey through this the second quarter of 2020.
Regarding npls ongoing priority in 2023 or execution focus remains on the following key buckets of potential value growth.
Accelerating prescription and share gains with <unk>, among our target physicians.
Continued evolution of the traditional net price and the result of a positive impact on net revenue growth.
Securing additional financing to fuel our ongoing commercialization activities. As previously mentioned, we do have ongoing discussions regarding additional capital and are optimistic of sharing progress in the near term.
And continued interest in aggressive and opportunistic business development.
And then finally based on the performance and momentum to date I would like to reaffirm all prescription guidance for <unk> for 2020, we.
We continue to anticipate delivering prescriptions in the range of 80000 to 110000.
The midpoint of which would represent a 64% growth over 2022.
And we will now open the lineup choke valve your questions. Operator can you please give the instructions.
Thank you ladies and gentlemen, if you have a question or a comment at this time. Please press star one on your telephone. If your question has been answered or you wish to move yourself from the queue. Please press star one again, we will pause for a moment, while we compile our Q&A roster.
Our first question comes from Stacy <unk> with TD Cowen Your line is open.
Hi, good morning, Thanks for taking our questions and welcome Michael to the Tam. So so just a few first how should we think about the evolution of the net pricing next year.
The continued improvements of reimbursement. So just curious if we should still expect that 400 to 500 net price per prescription by year end.
Nice to see that targeted DTC keep kudos for top of mind can you also talk about a little bit more about the impact of the additional sales force.
Have you gone through all the targets and how many times that you've been able to kind of reach that Miss you think about just that.
Reminding clinicians to think about prescribing trust just given all of the benefits. Thank you well. Thank you Steve.
<unk> referenced.
The second point on Africa latitude to comments on your questions around net price evolution.
I do recall when we when we first launched two desk, where we had a lot of questions around the DTC.
When we were going to take steps to.
To invest in that so we are delighted.
Being able to rollout.
DTC campaign.
Campaign.
Clearly one of the aspects of bothers to broad it raise awareness on the patient experience that is this happening with wood.
To desktop.
More specific to I think this is building on what we've already seen as being increased productivity with the sales force as we articulated on our last call I think the impacts of increasing our sales force from 60 to 90 in the kind of July August period of last year.
We've seen a significant kind of productivity and efficiency benefits of that.
The broadening of the of the sales force and clearly some of the parameters.
In the cases that we've covered today, particularly amongst new patient starts.
Obviously, the prescription evolution.
First stations of broad.
Efficiency that we've that we've seen now clearly with our targeted strategy. Initially it was 8000 positions as I mentioned today, we brought that to 11000 positions not only are we continuing to increase the breadth and depth of prescribing within our existing <unk>.
Super targets and targets within the target universe, but also I think the productivity increases that we are seeing in the additional target.
Population are also starting to see significant benefits as we can.
Rollouts over the course of time, so so again with a smart targeted disciplined approach to commercialization is all about execution focus not losing sight of the based on the foundation of our Super targets, but building depth.
Broadening the kind of the utility of prescriptions and our increased target physician population. So we're very pleased with the evolution that we're seeing but in this marketplace, which you're seeing significant growth. There is a lot more growth for us to build out.
We are doing at this point in time so.
So with that so maybe you can just make some broad comments in relation to the.
The changes we've made during the first quarter on quick star and the impact on that price evolution sure. Thanks, Adrian and thanks for the question Stacy. So as you saw on the slides we have been able to increase the percent of prescriptions approved from 60% at the end of Q4 now up to 75% in April settling in at 72%.
In the first quarter, and that's going to lead to a.
Very good evolution of the net price, we expect that percentage to continue to tick up over the course of 2023.
In concert with that as you know in the first quarter Theres, often the highest amount of pressure on your traditional co pay which is the buy down from.
75, or a $50 co pay downs.
Down to the zero dollars that we offered to reimbursed patients.
That pressure eases as you leave the first quarter and get away from deductibles and higher coinsurance and get into a more reasonable by now so that's going to help also move our net price north as.
As we move through the rest of the year. So we still feel very confident about that 4% to $500 range that you mentioned.
Thank you Stacey.
One of them before our next question.
Our next question comes from Eddie Hickman with Guggenheim Securities. Your line is open.
Hi, Good morning, Adrian and Michael Thanks for taking my questions. So you talked about the post holiday surgeon scripts, the higher reimbursement Youre seeing now in the second quarter and now this DTC campaign, starting so I'm wondering how we should think about the script guidance you provided and if any of those metrics do you think theyre going to be most important in driving those revenues towards the higher end versus the lower end of that guidance.
Yes, as we mentioned on the call.
Council and reaffirming that.
That guidance range and are tracking well towards towards that we always knew that the.
The momentum gained in the first and second quarter is going to be.
Really important and it's not momentum, but that has created the confidence but.
But we have them.
And clearly I think there are many different lead indicators that are very important in terms of getting on the right trajectory and very important I think not only is building our prescriber base.
<unk> to be important and that gets to the essence of our broadened target physician population, which is growing very very nicely in terms of consistent increases in new prescribers, but very importantly, the fuel a prescription growth in new patient starts.
Seeing the very significant increases in new patient starts that we all see.
That's going to be the key driver together with the consistently high refill rates, but we are building up over the course of <unk>.
Over the course of time so.
What I've learned and all the different products that have launched over the course of time as the execution focus and disciplined execution is paramount.
So thats why we are focused on these key lead indicators. So so.
So we are confident of that guidance range that we've given and that confidence is based on not only first quarter. Both very important the momentum that we saw strongly in March and as we move through April and into May So.
It gives us the confidence so one I don't whether you went out and it's about.
I think you said I think the only additional comment I would make is about the expanding prescriber base were.
As we add prescribers, we noticed they don't lapse, meaning they once they put a patient on <unk>.
So it is very rare that they don't continue to prescribe and so the expense salesforce and the efforts we make in not only driving depth.
But also gaining new prescribers.
Add to that confidence because we know they'll continue to prescribe <unk>.
Got it.
And then.
It seems to be like the tracking scripts is a pretty it's been pretty consistent whereas the gross to net seems to be what it's fluctuating in these first couple of quarters of launch and I'm wondering like as that grows that starts to stabilize if you would consider providing revenue guidance at some point this year or are you going to stick with script guidance. Thanks.
I think at this point in time, where we're going to be focused on prescription guidance on it.
Clearly as we've moved through the year.
The fourth and into the first quarter of this year, we've made reference.
On this call to the proactive kind of evolution from our quick start program.
To drive additional volume.
Net net.
Net price on obviously, a net revenue growth over the course of this.
This year. So so clearly I think given that we've gone through the.
The transition quarter in first quarter, which.
We're very pleased with the evolution that we've had.
We do feel that at this point in time, we want to continue with prescription guidance.
And clearly we will continue to reassess that over the course of time, but thank you for the question on them.
Sure.
And how much actually from I apologize someone just queued up for a question one moment.
Our next question comes from Sean Kim with Jones trading your line is open.
Yeah, Hi, Thank you for taking my questions I guess I have a quick question on DTC just curious.
How much capex step up that you expect from DTC campaign on year challenge their margin and expenses.
Going back to the.
Net price evolution GKN.
If you net out.
Typical seasonality for the first quarter, just curious if youre seeing.
Yes.
Your line.
That price.
Compared to the last.
Last year's or curious to kind of.
Steady.
Thank you.
Thank you Shawn I'll take the first question I think clearly I think because we mentioned I think we are.
Again, just stepping back to when we launched I got a lot of questions over the timing of any DTC activity. So we are very pleased that we've rolled out.
Count on it.
Program and unclear.
Is not a program.
Which obviously that utilizes TV advertising of this very much is there.
Leveraging the kind of the influences on the social media aspect, some very importantly, being able to get across the aspects of it.
Patient experience as well so it's a very cost effective disciplined kind of approach to direct to consumer.
Appetizers, but all of the Sophisticate point to this being a very effective means.
Broadening the awareness.
Very importantly, broaden the awareness not only a physician kind of experience, but very importantly, the patient experiences.
Well so sorry.
We see this as being a very cost effective way of not only supporting building on the overall prescription evolution with the with the product. So Len you may want to add something to that but also address the aspects of that price again.
I think you've addressed the DTC.
Components accurately on the net price evolution.
The one lever that we continue to talk about is the quick start the free goods lever and as you can see we're making consistent progress with that as we make would mean it made our adjustments in the first quarter.
Are there levers of our GTS are quite consistent and stable and so as we continue to make the improvements on the quick start as we continue to see the easing of the traditional co pay burden in the gross to net.
We expect to see consistent progress throughout 2023.
So I do think that we'll see an evolution over 'twenty two for sure.
Okay. Thank you.
And I'm not showing any further questions at this time I'd like to turn the call back over to Adrian Adams for any closing remarks.
Thank you operator, and thank you all for joining us.
This morning, we do look forward to updating you on our continued progress.
<unk>.
Our second quarter call. In later this year as we strive to continue to create value for patients.
<unk> got professionals, obviously the shareholders we serve.
Thank you very much and have a good rest of the day and indeed, a nice weekend. Thank you.
Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.
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