Q4 2023 Agile Therapeutics Inc Earnings Call
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None: Good morning, and welcome to the agile therapeutics fourth quarter and full year 2023 financial results Conference call. Please.
None: Please note today's event is being recorded.
None: I would now like to turn the conference over to Matt Raleigh head of Investor Relations. Please go ahead.
Hello, everyone and welcome to today's conference call to discuss our fourth quarter and full year 2023 financial results and corporate update.
Matthew Riley: Before we start let me remind you that today's call will include forward looking statements based on our current expectations, including statements concerning our financial outlook and financing prospects for the future management's expectations for our future financial and operational performance, including our expectations regarding the market growth of <unk> and our ability to become cash flow positive.
Matthew Riley: Our operating expenses, our business strategy, our partnership with <unk> ability to promote growth our product supply agreement with <unk> ability to make <unk> broadly at all locations.
Matthew Riley: The future availability of no cost access to draw under federal law, and our assessment of the combined hormonal contraceptive market generally among other statements regarding our plans prospects and expectations.
Matthew Riley: Such statements represent our judgments as of today are not promises or guarantees and may involve risks and uncertainties that may cause actual results to differ from the results discussed in the forward looking statements.
Further during the course of today's call, we will refer to certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in our press release issued today, which can be found on the Investor Relations section of our website.
Matthew Riley: Please refer to our filings with the SEC, which are available through the Investor Relations section of the website for information concerning risk factors that may affect the company.
Matthew Riley: We undertake no obligation to update forward looking statements, except as required by law the.
Matthew Riley: The information on today's call is not intended for promotional purposes and is not sufficient for prescribing decisions. Please note that we will not be conducting a Q&A session. Following our prepared remarks George.
Matthew Riley: Joining me on today's call is Alex Murray, Agile Therapeutics Chair and Chief Executive Officer.
Alex Murray: Thank you very much Matt.
Alex Murray: You all for joining us today on our call too.
Alex Murray: 2023 was a year for agile therapeutics.
Alex Murray: We believe demonstrated our ability to continue to grow to orla.
At this time last year, we were fielding questions from investors and analysts about the sustainability of our 2022 growth and performance moving forward.
Alex Murray: We believe we've answered a sustainability questions in 2023 by once again, demonstrating meaningful year over year growth in net revenue toilet demand and toilet factory sales, while simultaneously, reducing operating expenses to support our target revenue growth.
Alex Murray: Today I will review, our 2023 full year growth metrics, and then dive into the fourth quarter 2023 performance, which admittedly did not meet our expectations.
Alex Murray: We believe the fourth quarter represents an anomaly and our growth story and I will share our early impressions from the first two months of the first quarter of 2024 to support this.
First 2023 net revenue.
Alex Murray: Net revenue for full year, 2023 was $19 6 million, which represents an 80% increase from the $10 9 million reported for full year 2022.
Alex Murray: Our 2023 net revenue reflects improvements in the following key areas.
Alex Murray: First for all demands.
Alex Murray: Total demand for 2023 full year as reported by Symphony was 243841 total cycles of 131% increase from the full year 2022.
Alex Murray: Factory sales for the full year 2023 as reported by our wholesalers with 248220 total cycles of 117% increase from the full year of 2022.
Alex Murray: For the full year of 2020 to throw a factory sales were 114546.
None: As a reminder.
Not all the prescription demand in retail or non retail channels are reported to third parties like since they are our QBR the.
None: The demand numbers, we receive from our wholesalers were factory sales do include the broader scope of the retail and non retail sales and therefore, we believe factory sales more closely represent the total demand for <unk> across all our channels.
None: Net revenue demand and factory sales.
None: Are all key components of our overall growth plan.
None: We're simultaneously managing our operating expenses to align with supporting the growth.
None: As we think Youll see from our results we were disciplined in managing our spending once again in 2023.
None: Operating expenses for full year, 2023 were $30 5 million, which represents a 33% decrease from the $45 5 million reported for the full year 2022.
None: Comparing our full year 2021 results.
None: The full year 2023 full year net revenue has grown nearly 400%.
None: While full year operating expenses have decreased over 50%.
None: In our view the results represented by these key metrics is primarily attributed to the reengineering of our business plan as a commercial company that focuses on leveraging external partnerships.
None: While keeping our internal infrastructure lean and efficient.
None: Next our fourth quarter 2023 performance.
None: We remain confident in our ability to execute our business plan and believe that our lean commercial platform can continue to produce strong results through 2024.
None: With that said.
None: We did experience a different performance during the fourth quarter of 2023, but I'll explain why we are confident that this was an anomaly and not the new normal.
None: Fourth quarter 2023, net revenue was $3 6 million or 46% decrease from the $6 7 million reported for the third quarter 2023.
None: Trailer demand for the fourth quarter of 2023 as reported by Symphony was 68793 total cycles, a 7% decrease from the 74325 total cycles reported for the third quarter of 2023.
None: <unk> factory sales for the fourth quarter of 2023 as reported by our wholesalers with 68580, an 8% decrease from the 74424 in the third quarter of 2023.
None: The gross to net changes in the fourth quarter 2023 increased primarily due to three things.
None: Increased activity in our Medicaid business.
Second an increase in our overall returns reserve.
None: Third a larger mix of non retail business.
None: Operating expenses for the fourth quarter of 2023 were $5 $5 million, which.
None: Presented 33% decrease from the $8 2 million in the third quarter of 2023 <unk>.
None: Primarily due to our decision to forgo bonuses for all of 2023 for all employees, including management.
None: I've mentioned that we believe the dip in the fourth quarter of 2023 performance with an aberration.
None: And our growth story.
None: We believe this is because we are already starting to see numbers rebound in the first quarter of 2024.
None: Our preliminary January demand numbers show that we achieved the highest number of retail channels cycles in a single month since launch.
None: Additionally January was our second largest month for total cycles since launch.
Portola demand appears to be growing in February as well while February total demand was not quite as high as January.
None: February is demand was larger than any single month in the fourth quarter of 2023, and both retail and total cycles.
None: We continue to believe in our business model.
None: And its emphasis on partnerships to maximize <unk> growth potential.
None: 2024 is a pivotal year for both the company and the brand and we will explore any and all strategic opportunities both internally and externally as we seek to maximize <unk> growth and increase shareholder value.
None: To that end I'll touch on several relevant corporate updates.
None: First the elimination of debt owed to perceptive advisors.
None: Early this month, we announced the payoff of the remaining debt owed to perceptive advisors.
None: This is was a significant milestone for us and we believe the flexibility. This provides a our balance sheet will support our readiness to embrace and explore new opportunities. While we continue to execute our business plan and growth formula.
None: Once again, we'd like to thank our partners at perceptive to work collaboratively with us, especially during the challenging market environment for biotechnology.
None: Earlier this week, we announced we received a final delisting notice from NASDAQ due to our failure to regain compliance with their minimum stockholders' equity requirement.
None: As of March 26, 2020 for the company's common stock is now trading on the over the counter market, which is operated by the OTC markets groups under our existing AG Rx trading symbol, we do not expect this transition to OTC to impact our business operations and we remain.
None: Focus on executing our business plan, while continuing to explore strategic opportunities.
None: Now I'd like to talk about the Affordable Care Act, we remain optimistic about the steps being taken by the <unk> administration to enhance access to no cost contraception most.
None: Most recently in January 2021, bite and Harris administration announced new guidelines to enable expanded access to all FDA approved contraceptives without cost.
None: Following ongoing focus by the biting administration and lawmakers on contraception and the widespread barriers to reproductive health care. The department of Labor Health and human services and Treasury jointly released frequently asked questions or <unk> in January 2024.
None: <unk> outlines a new pathway, which plans and insurers to meet existing obligations under federal law by covering at no cost a broader range of FDA approved contraceptive drugs and certainly reproductive devices.
None: This pathway comes after reports of many plans in insurers imposing ongoing barriers to no cost contraceptive coverage.
None: Implementation of new guidance could eliminate financial barriers for contraceptive products like <unk> for approximately 49 million women.
None: While there are no new updates since January 2024 guidance. We believe this development is promising for our continued growth.
None: Before concluding today's call I will provide an updated snapshot of our current financial situation and outlook for 2024.
None: You can see a full description of our financial results for the fourth quarter and full year 2023, and our press statement and our annual report on Form 10-K.
None: And I'd like to take a minute to.
None: To comment on a few of the other financial results, which we believe also demonstrates the progress in 2023.
None: We continue to narrow our losses in 2023 weekly.
None: We closed out full year 2023, with a net loss of $14 5 million.
None: To a net loss of $25 4 million for a comparable period in 2022.
None: We ended 2023 with $2 $5 million of cash on hand and.
None: In January 2024, we raised $4 $8 million in gross proceeds through a warrant exchange agreement with a holder of our warrants.
None: We will continue to evaluate all options to finance the company. Additionally.
None: Additionally, we are exploring a broader range of opportunities that could benefit our business, including business development opportunities and or other strategic transactions.
None: We believe the performance of our business and its ability consistently growth.
None: The solidifying agile credibility as a potential partner in business development and other strategic transaction discussions.
None: We will continue to explore any and all opportunities as we seek to grow tortola and shareholder value.
None: This will conclude today's call and we encourage everyone to stay tuned for additional updates related to agile therapeutics into orla.
None: Thank you again for joining us for this call and following us along.
None: This concludes today's conference call. Thank you for your participation you may now disconnect.
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