Q1 2024 Esperion Therapeutics Inc Earnings Call
Operator: Ladies and gentlemen, thank you for standing by, and welcome. At this time, all participants are in a listen-only mode. Following the presentation, there will be a question and answer session. Please be advised that today's conference call may be recorded. I would now like to hand the conference over to Tiffany Aldrich, Associate Director of Corporate Communications at Esperion.
Ladies and gentlemen, thank you for standing by and welcome.
At this time all participants are in a listen only mode.
Following the presentation, there will be a question and answer session.
Please be advised that today's conference call maybe recorded.
I would now like to hand, the conference over to Tiffany outreach Associate director of corporate communications at Asbury off.
Tiffany: Please go ahead.
Tiffany Aldrich: Thank you, operator. Good morning, and welcome to Esperion's first quarter 2024 earnings conference call. With us today are Sheldon Koenig, President and CEO, and Ben Halladay, CFO. Other members of the executive team will be available for Q&A following our prepared remarks. We issued a press release earlier this morning detailing the content of today's call. A copy of that release can be found on the investor page of our website, together with a copy of the presentation that we will also be referencing.
Tiffany: Thank you operator, good morning, and welcome to experience first quarter 'twenty 'twenty four earnings conference call with US today are Sheldon Koenig, President and CEO and Ben Holiday CFO. Other members of the executive team will be available for Q&A following our prepared.
Tiffany: Remarks.
Tiffany: We issued a press release earlier this morning detailing the content of today's call a copy of that release can be found on the investor page of our website together with a copy of the presentation that we will also be referencing.
Tiffany Aldrich: I want to remind callers that the information discussed on the call today is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that management will be making forward-looking statements. However, actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the business.
Tiffany: I want to remind callers that the information discussed on the call today is covered under the safe Harbor provision of the private Securities Litigation Reform Act.
Tiffany: I caution listeners that management will be making forward looking statements.
Tiffany: Actual results could differ materially from those stated or implied by our forward looking statements due to risks and uncertainties associated with the business.
Tiffany Aldrich: These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our SEC filings. The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 7, 2024. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call and webcast. As a reminder, this conference call and webcast are being recorded and archived. We will begin the call with prepared remarks and then open the line for your questions. I'll now turn the call over to Sheldon.
Tiffany: These forward looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our SEC filings.
Tiffany: The content of this conference call contains time sensitive information that is accurate only as of the date of this live broadcast may seven 2024, we undertake no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date of this conference.
Tiffany: Call and webcast as a reminder, this conference call and webcast are being recorded and archived.
Tiffany: We will begin the call with prepared remarks, and then open the line for your questions I'll now turn the call over to Sheldon.
Sheldon L. Koenig: Thank you, Tiffany, and good morning, everyone. Thank you for joining us today to discuss our first-quarter results and the meaningful progress we continue to make. We are proud to report that we drove strong growth this quarter to start 2024, positioning us for long-term growth and success. In the first quarter, we delivered a total revenue of $137.7 million, which included the $100 million litigation-related settlement received from DSE in January.
Thank you Tiffany and good morning, everyone. Thank you for joining us today to discuss our first quarter results and the meaningful progress we continued to make we.
Sheldon L. Koenig: We are proud to report that we drove strong growth this quarter to start 2020 for positioning us for long term growth and success.
Sheldon L. Koenig: In the first quarter, we delivered total revenue of $137 $7 million, which includes the $100 million litigation related settlement received from DSC in January I'll note that even excluding this payment. This was the highest revenue generating quarter for ongoing business.
Sheldon L. Koenig: I'll note that even excluding this payment, this was the highest revenue-generating quarter for ongoing business in our company's history. U.S. net revenue was $24.8 million, which represents a 46% increase year-over-year, driven by a 43% increase in retail prescription equivalents. On March 22nd, we received FDA approval of broad new labels for Nexlitol and Nexlizet that reflect new indications for cardiovascular risk reduction and expanded LDL cholesterol lowering in both primary and secondary prevention patients.
Sheldon L. Koenig: In our company's history.
Sheldon L. Koenig: U S. Net revenue was $24 8 million, which represents a 46% increase year over year, driven by a 43% increase in retail prescription equivalents.
Sheldon L. Koenig: These new labels make Nexlitol and Nexlozet the only LDL-lowering, non-statins-approved for cardiovascular risk reduction in both primary and secondary prevention patients, and can now be taken with or without a stent. With these differentiated profiles, we are confident that these new labels position Nexlital and Nexlizet as the non-statins of first choice in treating patients with or at risk for cardiovascular disease. These new labels are also significant in their ability to bridge what we call the statin gap, which encompasses the tens of millions of patients at risk for cardiovascular disease who are unable or unwilling to take recommended statin therapy.
Sheldon L. Koenig: On March 22nd we.
Sheldon L. Koenig: Received FDA approval, a broad new labels for next with Paul Index was at that reflect new indications for cardiovascular risk reduction and expanded LDL cholesterol lowering in both primary and secondary prevention patients.
Sheldon L. Koenig: These new labels make next with Paul next was that the only LDL lowering non statin.
Sheldon L. Koenig: For cardiovascular risk reduction in both primary and secondary prevention patients.
Sheldon L. Koenig: It can now be taken with or without statin.
Sheldon L. Koenig: With these differentiated profiles, we are confident that these new labels position <unk> as the non status as a first choice in treating patients with or at risk for cardiovascular disease.
Sheldon L. Koenig: These new labels are also significant in their ability to bridge, what we call the stat and GAAP.
Sheldon L. Koenig: Encompasses the tens of millions of patients at risk for cardiovascular disease, who are unable or unwilling to take recommended statin therapy.
Sheldon L. Koenig: These approvals expand our potential addressable population to more than 70 million patients in the U.S. alone. The FDA approvals came on the heels of a positive CHMP opinion, and we continue to anticipate a similar and positive decision from the European Commission based on the EMA assessment of our European Cardiovascular Risk Reduction Label submissions by the end of the second quarter of 2024. And on the topic of Ex-US Progress, I'll note that we have initiated the technology transfer process with our partner DSE for the manufacturing and supply of our tablets in Europe, and we expect that process to be complete in the second half of next year.
Sheldon L. Koenig: These approvals expand our potential addressable population to more than 70 million patients in the U S alone.
Sheldon L. Koenig: The FDA approvals came on the heels of a positive <unk> opinion, and we continue to anticipate a similar and positive decision from the European Commission based on the EMA assessment on our European cardiovascular risk reduction label submission by the end of the second quarter.
Sheldon L. Koenig: 2024.
Sheldon L. Koenig: And on the topic of ex U S progress I'll note that we have initiated the tech transfer process with our partner Dfc for the manufacturing and supply of our tablets in Europe, and we expect that process to be complete in the second half of next year.
Sheldon L. Koenig: Ahead of the highly anticipated SDA approvals, we were preparing on all fronts to be ready to capitalize on our new labels the moment we had them, and we have hit the ground running. I'm pleased to share that all commercialization initiatives that we've previously mentioned are now in place. We launched our Lipid Lurkers consumer campaign and promotional digital tools. Our field teams have been fully trained and certified on our new indications and resources and participated in an in-person launch meeting last month.
Sheldon L. Koenig: Ahead of the highly anticipated FDA approvals, we are preparing on all fronts to be ready to capitalize on our new label. The moment. We have then and we have hit the ground running.
Sheldon L. Koenig: I'm pleased to share that all commercialization initiatives that we've previously mentioned are now in place.
Sheldon L. Koenig: We launched our lipid lurkers consumer campaign and promotional digital tools. Our field teams have been fully trained and certified on our new indications in resources and participated in an in person launch meeting last month.
Sheldon L. Koenig: We initiated partnerships to bolster our patient services platform to ensure healthcare practitioners can prescribe for appropriate patients while we await payer utilization management criteria changes, which usually take one to two quarters. On that note, I am pleased to share that we recently received confirmation of utilization management updates aligning to our new label from two large payers, one commercial payer with 23 million lives that will reflect the new label on June 1st, and two of the largest Medicare payers that represent 8 and 9 million lives each, immediately updated within a week of the label change.
Sheldon L. Koenig: We initiated partnerships to bolster our patient services platform to ensure healthcare practitioners can prescribe for appropriate patients, while we await payer utilization management criteria changes, which usually take one to two quarters.
Sheldon L. Koenig: On that note I am pleased to share that we recently received confirmation of utilization management updates aligning to our new label from two large payers one commercial payer with 23 million lives that will reflect the new label June one and two of the largest Medicare payers that represent eight and nine.
Sheldon L. Koenig: Lives each immediately updated within a week of the label change.
Sheldon L. Koenig: We anticipate additional pairs to align with our new labels on an ongoing weekly basis. In summary, we've made significant progress, and while it's still early, we're encouraged by the positive initial momentum we've seen thus far in the first few weeks of the second quarter. With that, I will now hand it over to Ben for a more detailed review of our first quarter financial performance.
Sheldon L. Koenig: We anticipate additional payers to align with our new labels on an ongoing weekly basis.
Sheldon L. Koenig: In summary, we've made significant progress and while it's still early we're encouraged by the positive initial momentum we've seen thus far in the first few weeks of the second quarter.
Sheldon L. Koenig: With that I will now hand, it over to Barry for a more detailed review of our first quarter financial performance.
Benjamin Halladay: Thank you, Sheldon. Earlier this morning, we issued a press release containing our financial results for the first quarter, which is available on the investor page of our website. Please note that unless otherwise specified, my comments reflect results for the first quarter ended March 31st, 2020. As Sheldon mentioned, we are proud of our performance and the strong results we delivered in the first quarter, including new-to-brand prescriptions. Our momentum continues to accelerate, which underscores the fact that outcomes data matters, and we're thrilled that outcomes data is now incorporated into our new label, which means we can now actively promote that data for the first time, and that we'll now be able to reach millions more patients.
Barry: Thank you Sheldon earlier. This morning, we issued a press release containing our financial results for the first quarter, which is available on the investor page of our website.
Barry: Please note that unless otherwise specified my comments reflect results for the first quarter ended March 31 2024.
Barry: As Sheldon mentioned, we're proud of our performance and strong results, we delivered in the first quarter, including new to brand prescription our momentum continues to accelerate which underscores the fact that outcomes data matters and we're thrilled that data is now incorporated into our new label.
Barry: Which means we can now actively promote that data for the first time and that will now be able to reach millions more patients in need.
Benjamin Halladay: For the fifth quarter in a row, we again delivered continued growth in retail prescription equivalents, which increased 43% year-over-year and 6% quarter-over-quarter, and, as a reminder, almost entirely dependent on our prior label and promotional footprint that has only recently ramped up. The weekly RPE trend again reflects this momentum and remained above the 12,000 RPE mark for all of March, a new high.
Barry: For the fifth quarter in a row, we again delivered continued growth in retail prescription equivalents, which increased 43% year over year, and 6% quarter over quarter and as a reminder, almost entirely dependent on our private label and promotional footprint that has only recently ramped up.
Barry: The weekly RPE trend again reflects with momentum and remained above the 12000 RPE Mark for all of Mark a new high for us.
Benjamin Halladay: Growth outside the US also continued at an impressive clip. Our partner DSE delivered yet another strong quarter of sales growth in its territories, highlighting the value and growth of the potential of our global franchise. At the end of February, approximately 255,000 patients have now been treated with our therapies in Europe, representing sequential three-month growth of 26% since November. While most of this growth was generated from existing territories, DSE continues to expand, launching in the Czech Republic in the first quarter.
Barry: Growth outside the U S. Also continued at an impressive clip our partner DSD delivered yet another strong quarter of sales growth in its territory, highlighting the value and growth potential of our global franchise.
Barry: At the end of February approximately 255000 patients have now been treated with our therapy in Europe, representing sequential three month growth of 26% since November.
Barry: While most of this growth was generated from existing territory DSC continues to expand launching in the Czech Republic in the first quarter.
Benjamin Halladay: I'll also note progress by our Asia region partner Daiichi Sankyo Company Limited, which gained approvals in Myanmar and Thailand in the first quarter. Now, turning to our financial results for the quarter. We reported U.S. net product revenue of $24.8 million, representing an increase of 46% year over year. Collaboration revenue, which includes combined royalty and partner revenue, was $113 million, an increase of 1,148% year-over-year. This growth includes the $100 million settlement received in January in connection with our litigation resolution. Excluding milestone payments, combined royalty and partner revenue grew 110% year over year.
Barry: I'll also note progress by our Asia region partner, Daiichi Sankyo Company limited, which gained approvals EMEA <unk> in Thailand in the first quarter.
Barry: Turning to our financial results for the quarter.
Barry: We reported U S net product revenue of $24 8 million, representing an increase of 46% year over year.
Barry: Collaboration revenue, which includes combined royalty and hardware revenue was $113 million, an increase of 1148% year over year.
Barry: This growth includes the $100 million settlement received in January in connection with our litigation resolution, excluding milestone payments combined royalty and partner revenue grew 110% year over year.
Barry: Finally total revenue for the first quarter was $137 7 million, an increase of 467% year over year.
Barry: I'll note that this includes the previously mentioned $100 million.
Barry: Settlement excluding.
Barry: Milestone total revenue grew 65% year over year.
Benjamin Halladay: Finally, total revenue for the first quarter was $137.7 million, an increase of 467% year-over-year. I'll note that this includes the previously mentioned $100 million settlement; excluding milestone total revenue grew 65% yearly. Journey to Expense. Cost of goods sold for the first quarter was $10.1 million, a decrease of 14% year over year, driven primarily by lower unit tablet costs for sales in the U.S. and supply to our international partners. R&D expense was $13.4 million, a decrease of 57% year over year, reflecting substantially lower costs following the closeout of our clear outcomes trial.
Barry: Turning to expenses cost.
Barry: Cost of goods sold for the first quarter with $10 1 million a decrease of 14% year over year, driven primarily by lower unit tableau cost per sales in the U S and supply for our international partners.
Barry: R&D expense of $13 4 million, a decrease of 57% year over year, reflecting substantially lower costs. Following the closeout of our clear outcomes trial.
Benjamin Halladay: SG&A expense was $42 million, an increase of 40% year-over-year, reflecting higher headcount as we began to ramp up our in-house sales force, bonuses, and promotional costs in anticipation of the launch of the expanded labels from Nexler Hall and Nexler. Finally, cash and cash equivalents totaled $226.6 million as of March 31, 2024, compared with $82.2 million on December 31, 2023, reflecting a strong balance sheet with sufficient capital to support our commercial operations and drive continued long-term growth.
Barry: SG&A expense was $42 million, an increase of 40% year over year, reflecting higher head count as we began to ramp up our in house sales force bonuses and promotional costs in anticipation of the launch of expanded labels from Mexico and Mexico.
Barry: Finally, cash and cash equivalents totaled $226 6 million as of March 31, 2024, compared with $82 2 million on December 31, 2023, reflecting a strong balance sheet with sufficient capital to support our commercial operations and drive continued long term growth.
Benjamin Halladay: We also reiterate our 2024 expense guidance, continuing to expect R&D expense to be between $45 million and $55 million, SG&A expense to be between $180 million and $190 million, and total OPEX expense to be between $225 million and $245 million. Although we've meaningfully strengthened our balance sheet in the first quarter, we will continue to remain disciplined with expense management, ensuring sufficient returns are being generated across. And with that, let me now hand it back over to you, Sheldon.
Barry: We also reiterate our 2024 expense guidance continuing to expect.
Barry: R&D expense to be between $45 million and $55 million SG&A expense to be between $180 million and $190 million.
Barry: In total opex expense to be between $225 million and $245 million.
Barry: Although we have meaningfully strengthened our balance sheet in the first quarter. We will continue to remain disciplined with expense management, ensuring sufficient returns are being generated across the company.
Barry: And with that let me now hand, it back over to you Sheldon.
Sheldon L. Koenig: Thank you, Ben. In closing, we continue to deliver on our commitments and execute on our strategic plan to achieve the blockbuster status we know our franchise is capable of. We delivered another strong quarter of growth and ended the quarter with sufficient capital to support our commercial initiatives and drive continued long-term growth. We received approval for broad new labels and launched commercial initiatives to capitalize on the opportunity we now have to reach the millions of patients in need of our therapies.
Sheldon L. Koenig: Thank you Ben in closing, we continue to deliver on our commitments and execute on our strategic plan to achieve the blockbuster status will be no. Our franchise is capable of.
Sheldon L. Koenig: We delivered another strong quarter of growth and ended the quarter with sufficient capital to support our commercial initiatives and drive continued long term growth.
Sheldon L. Koenig: We received approval for broad new labels and launch commercial initiatives to capitalize on the opportunity. We now have to reach the millions of patients in need of our therapies.
Sheldon L. Koenig: In summary, I remain extremely confident that we will continue to drive patient and shareholder impact and value creation by capitalizing on this momentum throughout this year and into the future, and I thank the entire Esperion team for helping us get to this pivotal moment. Operator, we are now ready for Q&A. Thank you.
Speaker Change: In summary, I remain extremely confident that we will continue to drive patient and shareholder impact and value creation by capitalizing on this momentum throughout this year and into the future and I. Thank the entire spirit team for helping us get to this pivotal moment.
Speaker Change: Operator, we are now ready for Q&A.
Speaker Change: Thank you.
Operator: Ladies and gentlemen, to ask a question, please press star 1-1 on your telephone and then wait to hear your name announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A list. Our first question comes from the line of Dennis Ding with Jeffries. Your line is open.
Speaker Change: Ladies and gentlemen to ask a question. Please press star one on your telephone and then wait to hear your name announced to withdraw your question. Please press star one again please.
Speaker Change: Please standby, while we compile the Q&A roster.
Speaker Change: Our first question comes from the line of Dennis thing with Jefferies. Your line is open.
Eric J. Warren: Hi, good morning, and thanks for taking our questions. Two for me, maybe one on the, you know, if you guys could just comment on the prescription habits of doctors since the label update. Have you seen any shift in PCPs versus cardiologists that you want to call out, and if you are seeing any enthusiasm among the primary prevention doctors? And then, secondly, on scripts, they've kind of looked generally flat since the label update, so I'm just wondering if you have a comment on what happened over the last month, and when do you expect that script, that weekly script growth to accelerate? Thank you.
Dennis: Hi, good morning, and thanks for.
Dennis: Taking my questions two from me.
Dennis: One on the if you guys can just comment on the prescription habits from doctors in the label update.
Dennis: Have you seen any shift in Pcs.
Dennis: Tcp's versus cardiologists that you want to call out and if you're seeing any enthusiasm among the primary prevention doctors.
Dennis: Doctors and then secondly on script, Steve kind of look generally flat since the label update so I'm just wondering if you have a comment on.
Dennis: What happened over the last month and when do you expect that scrip.
Dennis: Weekly script growth to Reaccelerate. Thank you.
Eric J. Warren: And hi, Dennis, it's Eric. I'll take this one. So first of all, yes, there's a lot of enthusiasm for the new label, and primary prevention is generating a lot of enthusiasm as well. Just a reminder that we are the only non-statin that's FDA approved to lower LDL-C and decrease the risk of MI and coronary revascularization in those primary prevention as well as secondary prevention patients.
And hi, Dennis It's Eric I'll take this one so first of all yes. There is a lot of enthusiasm for the new label and that's primary prevention is generating a lot of enthusiasm as well just a reminder, that we are the only non statin, that's FDA approved to lower LDL C and to decrease the risk of <unk>.
Dennis: And coronary Revascularization primary prevention as well as secondary prevention patients. So enthusiasm is strong.
Dennis: I see right now a balanced prescribing between primary care and then cardiologists, but do expect that primary care prescribing to increase and remember it's about utilization management criteria as well. So that's progressive increases that we'll see as payers start to <unk>.
Dennis: April prescribing for those populations I am encouraged by the early qualitative feedback and then the last two weeks as you've probably seen we have seen week over week growth. So expect it to take a little bit of time, but expect progressive increases again access payer changes to increase.
Eric J. Warren: So enthusiasm is strong. I'm encouraged by the early qualitative feedback. And then, the last two weeks, as you've probably seen, we have seen week over week growth. So expect it to take a little bit of time, but expect progressive increases again as those payer changes increase. But customer enthusiasm is incredibly high.
Dennis: Customer enthusiasm is incredibly high.
Sheldon L. Koenig: And Dennis, I just wanted to add that, you know, we're super early in the game. The people I represented were trained on the label, actually received the first view of the label in early April, and then they were essentially off territory for two weeks in April because we had an all-company meeting. We also had our training, and they actually received the full detail aid in the third week of April. They were detailing off the label, so just to reiterate what Eric is saying, we're actually very encouraged in what we're seeing right now and, as we said in our prepared remarks, very confident about growth as we continue through the quarter.
Speaker Change: And Dennis I, just wanted to add that we're super early in the game. Our representatives were trained on the label.
Speaker Change: We received the first view of the label.
Speaker Change: Early April and then they are essentially off territory for two weeks in April because we had all company meeting. We also had our training and they actually receive the full detailed eight in the third week of April they were detailing off of the label. So.
Speaker Change: Just to reiterate what Eric is saying, we're actually very encouraged in what we're seeing right now and as we said in our prepared remarks very confident about growth as we continue through the quarters.
Eric J. Warren: Got it. And then maybe if I could follow up, in terms of the script reacceleration, around when do you expect that to occur? Because when you look at the last two weeks, they have been growing, you know, 1% to 5%. But I'm just wondering if that could grow more and when the soonest that could happen.
Speaker Change: Got it and then maybe if I can follow up.
Speaker Change: And in terms of the scrip for scrip re acceleration around when do you expect that to curve because when you look at the last two weeks they have been growing.
Speaker Change: 1% to 5% I'm just wondering if.
Speaker Change: That could grow more and when the soonest that could happen.
Speaker Change: <unk>.
Eric J. Warren: Yeah, Dennis. So, again, progressive increases are what I would anticipate. And it really will be as those the bulk of utilization management changes. We anticipate about two quarters to get the majority of UM aligned with a new label. So progressive increases with full kind of growth realization when we have that UM alignment.
Speaker Change: Yes, Dennis so so again progressive increases are what I would anticipate and it really will be at.
Speaker Change: The bulk of utilization management changes we anticipate.
Speaker Change: About two quarters to get the majority of you am aligned with the new label, So progressive increases with fall kind of growth realization when we have that U M alignment.
Operator: Got it. Thanks and congrats on all the progress.
Speaker Change: Got it thanks, and congrats on all the progress.
Speaker Change: Thanks Dennis.
Eric J. Warren: Please stand by for our next question. Our next question comes from the line of Serge Belanger with Needham. Your line is open.
Speaker Change: Thank you.
Speaker Change: Ladies standby for our next question.
Search: Our next question comes from the line of search <unk> with Needham Your line is open.
Eric J. Warren: Hi, good morning. Thanks for taking my questions. First one, as utilization management gets updated across the payers with the new label, can you just remind us what it's going to look like and whether you expect it to be pretty standard across all the payers covering benidoic acid? And secondly, I think Medicare coverage for the product has lagged commercial coverage. Can you just give us an update on when you expect Medicare coverage to pick up on the product?
Needham: Hi, good morning, Thanks for taking my questions.
Needham: First one.
Needham: As the utilization management.
Search: It gets updated across the peers with a new label can.
Search: Can you just remind us what it is going to look like and whether you expect.
Search: It should be pretty standard across all the payers covering.
Search: Delek asset.
Search: Secondly.
Search: I think Medicare coverage for the product has lagged the commercial coverage can you just give us an update on.
Search: When do you expect Medicare coverage to to pick up on the product.
Eric J. Warren: Yeah, yeah, thanks, Serge. So as you're aware, and as we've stated before, in the past. The prior utilization management criteria required a patient to have ASCVD or be a secondary prevention patient. When the utilization management changes start to happen, we will see primary prevention patients included as well. We've also had pretty significant statin requirements or maximally tolerated statin requirements that we anticipate will ease as well based upon the outstanding new label that we have.
Speaker Change: Yes, thanks, Serge so as you're aware and as we've stated in the past that the prior utilization management criteria has required patients to have <unk>.
Speaker Change: CBD or be a secondary prevention patient when the utilization management changes start to happen.
Speaker Change: You will see the primary prevention patient included.
Speaker Change: As well we've also had.
Pretty significant statin requirements are maximally tolerated statin requirements that we anticipate at ease as well based upon the outstanding New label that we have.
Eric J. Warren: With regard to Medicare, as Sheldon mentioned in the opening remarks, we did see a Medicare payer change and update their utilization management criteria, and there will be many more of those on the horizon over the course of the next two quarters. Very encouraging. Hopefully, that answered your question, Serge.
Speaker Change: With regards to Medicare as Sheldon mentioned in the opening remarks, we did see.
Speaker Change: Already our Medicare payer change and update their utilization management criteria.
Speaker Change: And there will be many more of those on the horizon over the course of the next two quarters, so very encouraging and hopefully that answered your question Serge.
Sheldon L. Koenig: And Eric, if I could just add, this was a new... So we had one that updated its UM criteria, and then we had one that is one of the largest Medicare providers. That was an absolute new win. So it gets our coverage closer to 50% in Medicare. So we're very happy about that.
Speaker Change: Eric if I could just add this was a new so we had one that updated the <unk> criteria and then we had one that is one of the largest Medicare providers that was an absolute new win.
Eric: So it gets our coverage closer to 50% in Medicare So we're very happy about that.
Benjamin Halladay: Great. And maybe just one follow-up. So as Medicare coverage ramps up, do you expect any impacts on growth going forward?
Eric: Great and then maybe just one follow up.
Speaker Change: As a Medicare coverage ramps up do you expect any impact to gross to net going forward.
Operator: Hey, Serge, this is Ben. I'll take that. Not a meaningful one, I would say. The Medicare coverage gap is always something that affects us and has in the past, but I think as a sort of distribution of the total, it's not going to be a meaningful impact on growth.
Speaker Change: Hey, Serge this is Ben I'll take that not a meaningful one I would say Medicare coverage gap is always something that the fact that it has in the past, but I think as they sort of distribution of the total.
Benjamin Halladay: Yes, its not going to be a meaningful impact to growth.
Serge: Got it thank you.
Speaker Change: Thank you.
Joanne Micale Foody: Please stand by for our next question. Our next question comes from the line: Tom Shrader with BTIG. Your line is open.
Speaker Change: Please standby for my next question.
Speaker Change: Our next question comes from the line of Tom Shrader with <unk>. Your line is open.
Operator: Good morning. Congratulations. It looks like we're close now. So I have sort of a very general question.
Thomas Eugene Shrader: Good morning, Congratulations it looks like we're close now so.
Joanne Micale Foody: You're in the market with a statin alternative. I think we all use this vague number of 10% of patients having some trouble with statins. Do you have updates on that number? Are you finding that that number is close or very off? And does it differ between undertreated and treated patients?
Thomas Eugene Shrader: Sort of a very general question you are in the market with a statin alternative I think we all use this big number of 10% of patients have some trouble with statin do you have updates on that number or are you finding that that number is close or very off or and does it differ between undertreated and treated.
Eric J. Warren: I'm just wondering if we could borrow some of your market surveillance equipment. Thank you.
Speaker Change: So I'm just wondering if we can borrow some of your market surveillance. Thank you.
Joanne Micale Foody: So, Tom, this is Joanne Foody. From the standpoint of statin intolerance, I think what we're understanding is that statin intolerance is a broad category. So, your 10% number may speak to individuals who are completely unable or unwilling to take a statin. When we look at the opportunity for our therapy, it is in individuals who can't take a statin at all, which has that kind of number of 10%. But in fact, in individuals who can't escalate their dose of a statin, the lower dose to maximally tolerate it.
Speaker Change: So Tom this is Joanne Rudy.
Thomas Eugene Shrader: From the standpoint of statin intolerant I think what we're understanding is that statin intolerance is a broad range. So your 10% number may speak to individuals who are completely unable or unwilling to take a statin. When we look at the opportunities for our therapy is in India.
Thomas Eugene Shrader: Digital who can't take a statin at all right, which has that kind of number of 10%, but in fact individuals who can't escalate their dose a lower dose to maximally tolerated and those taken together start to get its numbers closer to the 30% I can't speak to.
Joanne Micale Foody: And those taken together start to get us numbers closer to the 30%. I can't speak to the market. Eric, if you'd like to speak to that, that's fine. But from a clinical perspective, the numbers are closer. And we'll be publishing data, and have published data in that realm, showing that it's probably closer to a 30% if we think about complete and partial statin intolerance.
Thomas Eugene Shrader: The market, Eric if you'd like to speak to that that's fine, but from a clinical perspective, the numbers aren't closer and we will be publishing data and you have published data in that realm, showing that it's probably closer to 30%. If we think about complete and partial statin times.
Eric J. Warren: And that's part of our education process, Tom, as well, to let HCPs know that statin intolerance isn't just the inability to take any statin, but it is the inability to maximize statin doses. And that's something that HCPs have been very receptive to. It rings a bell as they're starting to think of patients. And as we go out and communicate with appropriate patients, that is definitely a patient that we're focused on. And just a quick one.
Thomas Eugene Shrader: And that's part of our education process, Tom as well as two.
Speaker Change: Let hcp's know that statin intolerance isn't just the inability to take any stat embedded is that inability to maximize statin doses and that's something that hcp's have been very receptive.
Speaker Change: Brings the ballast theyre, starting to think of patients and as we go out and communicate appropriate patients and that is definitely a patient that we're focused on.
Eric J. Warren: And just a quick follow-up, so is undertreatment the bigger opportunity because they're clearly under the care of a physician and know their lipid numbers?
Speaker Change: And just a quick follow up so is undertreated the bigger opportunity because there they are clearly under the care of a physician and no other lipid numbers.
Speaker Change: Yes.
Eric J. Warren: Yeah, it's, I mean, there's clearly a recognition that patients can't achieve their goals with current therapies. So those that are actively treating are our primary focus. As we've said, there is roughly a 70 million eligible patient population as a result of our label change. We're focused on 30 million of those patients, and those are patients that are actively engaged in therapy.
Speaker Change: Yeah. It's I mean, there is clearly a recognition that patients can achieve their goals with current therapies. So those that are actively treating our primary focus as we've said there is roughly a $70 million.
Speaker Change: Eligible patient population as a result of our label change we're focused on 30 million of those patients and those are patients that are actively engaged in therapy.
Speaker Change: Perfect great. Thank you.
Speaker Change: Youre welcome. Thank you.
Operator: Please stand by for our next question. Our next question comes from the line of Jessica Fye with J.P. Morgan. Your line is open. Hey, guys, good morning.
Speaker Change: Please standby for our next question.
Speaker Change: Our next question comes from the line of Jessica Fye with Jpmorgan. Your line is open.
Sheldon L. Koenig: Hey guys, good morning. Thanks for taking my question. I want to ask about volume trends. So we saw a clear inflection in volume on the back of ACC last year, and we're just starting to annualize that, albeit with the approval now in hand. So should we expect another inflection in volume, thanks to the ability to promote? Or maybe more of a continuation of the trajectory the franchise has been on? Or is it reasonable to think about a deceleration given just the tougher comp? Maybe I'll stop there.
Jessica Macomber Fye: Hey, guys. Good morning, Thanks for taking my question.
Jessica Macomber Fye: I wanted to ask about volume trends. So we saw clear inflection in volume on the back of ACC last year, and we're just starting to annualize over that albeit with the approval now in hand, so should we expect another inflection in volume thanks to the ability to promote or maybe more of a continuation of the truth.
Jessica Macomber Fye: Victory of the franchise has been on or is it reasonable to think about a deceleration given just the tougher comps.
Jessica Macomber Fye:
Speaker Change: And I'll stop there.
Operator: Hi Jess, it's Sheldon. I'll start with this. So we've always said that with our label, you would see a meaningful inflection of our business. Even before our label, we said that we would show, you know, continued quarterly growth. Again, keep in mind that in the first quarter, the results that we're showing today don't even include what we've got; we didn't have the new label yet. So, I think if I understand your question correctly, the outlook is, you know, we will continue to show acceleration in the growth of our products, you know, based upon the new label that we have.
Shell: Hey, Jess it's shell then.
Shell: I'll start with that so we've always said that with our label you would see a meaningful inflection of our business.
Shell: Even before our label, we said that we would show continued quarterly growth.
Shell: Again keep in mind in the first quarter the results that we're showing today.
Shell: It doesn't even include what we've had.
Speaker Change: Have the new label yet.
Speaker Change: No.
Speaker Change: I think if I understand your question correctly the outlook on that.
Speaker Change: We will continue to show acceleration in the growth.
Speaker Change: Some of our products based upon the new label that we have as Eric just previously mentioned, we know that we have a patient population of close to 70 billion patients who could benefit from this drug and additional LDL lowering and risk reduction what we haven't talked about is the actual pace of that growth.
Operator: As Eric just mentioned, we know that we have a patient population of close to 70 million patients who could benefit from this drug and additional LDL lowering and risk reduction. What we haven't talked about is the actual pace of that growth. It's not going to happen as a quick inflection, but we're going to see meaningful growth, more aggressive growth as we march through the quarters.
Speaker Change: It's not going to happen as a quick inflection, but we're going to see meaningful growth more aggressive growth as we march through the quarters.
Speaker Change: Great. Thank you.
Speaker Change: Thank you.
Eric J. Warren: Please stand by for our next question. Our next question comes from the line of Jason Butler with Citizens JMP. Your line is open.
Speaker Change: Please standby for our next question.
Speaker Change: Yeah.
Speaker Change: Our next question comes from the line of Jason Butler with citizens JMP. Your line is open.
Eric J. Warren: Hi, good morning. Thanks for taking the questions. This is Joseph for Jason. Just a very quick one from us: have any of the peers pushed back on increasing access following the label expansion?
Jason Nicholas Butler: Hi, good morning, Thanks for taking the questions just Jose Jason and just a very quick one from us any of that.
Jason Nicholas Butler: Peters push back on increasing access following the label expansion.
Jason Nicholas Butler: Okay.
Eric J. Warren: Yeah, it's Eric. I can, I can start this one off. Okay. I'd say our discussions have been very positive so far, and I haven't heard of any negative receptivity from a payer perspective. Obviously, payers have their own timelines, so some of them may operate sooner than others. But based upon the cadence of how this was handled, initially, there were medical discussions, and then those translated into confirmation, post-label change, and then business discussions. And so far, all these discussions have been very favorable.
Jason Nicholas Butler: Yeah, It's Eric I can I can start this one off so I.
Eric: I'd say, our discussions have been very positive so far I haven't heard of any negative a receptivity from a payer perspective, obviously payers have their own timelines and so some of them may operate sooner than others, but based upon the cadence of how this was handled initially.
Eric: There were medical discussions and then those translated into confirmation.
Eric: Post label change and then business discussions and so far all of these discussions have been very favorable.
Eric J. Warren: Very helpful, thanks. And just a very quick one on the commercial efforts. So now that all the commercial efforts are in place, how are you gauging the success of the commercial investment in the U.S., and do you expect to make any adjustments to the sales force accordingly?
Speaker Change: Very helpful. Thanks, and just a very quick one on the commercial but ive heard so now that all the commercial efforts are in place.
Speaker Change: Are you gauging the success of the commercial investment in the U S and do you expect to make any adjustments to the sales force accordingly.
Eric J. Warren: Yeah, so we've made the adjustments to Salesforce. So we're at the number that we anticipate staying at for a while, which is at 150.
Speaker Change: Yes, so we've made the adjustments to the sales force. So we're at the number that we anticipate staying at for a while which is at 150 as a reminder, with the salesforce or personal promotion as well as our digital footprint, we're able to cover about 45000 hcp's.
Eric J. Warren: As a reminder, with Salesforce, our personal promotion, as well as our digital footprint, we're able to reach about 45,000 HCPs. So we've got a good infrastructure in place. In terms of how we measure success, well, first of all, we have to have discussions with our HCPs. So we're looking at both the commercial, actually the digital reach, as well as the personal reach. And our teams have been very successful in having those discussions with the targeted HCPs.
Speaker Change: So we've got a good infrastructure in place in terms of how do we measure success well first of all we have to have discussions with our HCP. So we're looking at both the commercial.
Speaker Change: And actually the digital reach as well as the personal reach and our teams have been very successful and having those discussions with the targeted hcp's.
Eric J. Warren: The digital footprint has been strong. We've seen over 19 million impressions between HCPs and consumers over the first five weeks. So those are very encouraging metrics. Obviously, those are some early indicators, but the significant indicators will be actually watching those share increases happen over the upcoming weeks and quarters.
Speaker Change: The digital footprint has been strong.
Speaker Change: You've seen over 19 million impressions between Hcp's and consumers over the first five weeks. So those are very encouraging metrics. So obviously those are some early indicators, but.
Speaker Change: The significant indicators will be actually watching those share increases happen over the upcoming weeks and quarters.
Operator: Very helpful. Thanks for taking the question.
Speaker Change: Very helpful. Thanks for taking the questions Youre welcome.
Eric J. Warren: Please stand by for our next question. Our next question comes from the line of Joe Pantginis with H.C. Wainwright. Your line is open.
Speaker Change: Thank you.
Speaker Change: Please standby for our next question.
Speaker Change: Our next question comes from the line of Joe Tank Guinness with H C. Wainwright. Your line is open.
Operator: Hey, everybody. Good morning.
Speaker Change: Hey, everybody good morning, thanks for taking the questions.
Speaker Change: So I wanted to approach. The question also from the statin intolerance or long term side effects and sort of.
Eric J. Warren: Thanks for taking the questions. So I wanted to approach the question also from the statin intolerance or, you know, long-term side effects and sort of, you know, overall, you know, concern from some patients in general where, you know, right now all the focus is on HCPs and their views about the new label and we're expecting to see that growth inflection as you guys are as well. So I guess I would ask the question from the following standpoint.
Speaker Change: Overall concern from some patients in general where right now all the focus is on Hcp's and their views about the new label label and we're expecting to see that growth inflection in <unk>. As you guys are as well so I guess I would ask the question from the following standpoint.
Eric J. Warren: Are you going to collect data or do you even want to sort of pontificate, if you will, about the role of patients in helping to drive those decisions as you know, they're, you know, much more savvy, they have Google and what have you, or, you know, they say, "I haven't had an option for a statin up till this point, doctor, but, you know, this really looks interesting." You know, what role do you think patients' feedback will have in changing their treatment guidelines?
Speaker Change: Are you going to collect data or do you even want to sort of pontificate. If you will about the role of patience in helping to drive those decisions as they are much.
Speaker Change: Much more savvy, they have Google and what have you or they say I haven't had an option for statin up until this point doctor, but this really looks interesting.
Speaker Change: What role do you think patients feedback we will have in changing there.
Speaker Change: Their treatment guidelines.
Eric J. Warren: It's going to have a significant role, Joe. So, as Sheldon mentioned in the opening remarks, we do have a consumer-based campaign that we've deployed as well. We call these little creatures the lipid lurkers. And they're out there, they're present, wreaking havoc. And we've put those forward in the digital universe. Just from a meta campaign perspective, we've seen 1.6 million exposures with the lipid lurkers. They're present on many other platforms as well.
Speaker Change: It's going to have a significant role Joe So as Sheldon mentioned in the opening remarks, we do have a consumer based campaign that we've deployed as well we call.
Speaker Change: These little creatures, the lipid markers and they're out there they're present, reaching wreaking havoc.
Speaker Change: And we've put those forward and the digital universe.
Speaker Change: Just from a meta campaign perspective, we've seen $1 6 million exposures.
Speaker Change: The lipid lurkers, either present and many other platforms as well so consumers play a significant role obviously, we've got to be very targeted and we don't want to go to the broad consumer universe. We want to go to those who are our target patient and I think the team's done a great job so far at doing just that.
Sheldon L. Koenig: So, consumers play a significant role. Obviously, we've got to be very targeted. We don't want to go to the broad consumer universe. We want to go to those who are our target patients. And I think the team's done a great job so far at doing that.
Sheldon L. Koenig: And Joe, first of all, good morning. What we saw last year, too, after ACC, and we did collect data, is that consumers really went out there, you know, when they saw information, etc. To your point, consumers are very different. They're well-informed now. They want to find out more. And we saw a lot of them post-ACC head out into their physicians' offices and ask about NexLizette, and NexLatal. We recently received some research which shows that they're doing it again.
Speaker Change: And Joe.
Joe: Yes no.
Joe: First of all good morning.
Speaker Change: What we saw last year or two after ACC. We did collect data is that consumers really went out there when they saw information et cetera to your point you have it.
Speaker Change: Consumers are very different they are well informed now they want to find out more and we saw a lot of them post ACC.
Speaker Change: Head out into their physician's offices and ask about <unk>. We recently received some research which shows that theyre doing it again.
Sheldon L. Koenig: You know, Eric and I were just mentioning when we were in the office that even on our Instagram, and Facebook, we're seeing these lipid lurkers, and we're also seeing the new campaign that we have. So, it's definitely a big part of it. And people want to know, one, do I have to, you know, I don't want to take a stronger dose of a statin, or I don't want to take a statin because I can't.
Speaker Change: Eric and I were just mentioned and when we are in the office that even on our Instagram or Facebook. We're seeing these lipid lurkers and we're also seeing the new campaign that we have so.
Speaker Change: It's definitely a big part of it and people want to know about.
Speaker Change: One do I have to I don't want to take a stronger dose of a statin or I don't want to take a statin because I can't.
Speaker Change: So theyre very savvy about this.
Operator: Now I appreciate that color. Thank you very much.
Sheldon L. Koenig: So, they're very savvy about that. Now, appreciate
Speaker Change: No I appreciate that color. Thank you very much.
Speaker Change: Thanks, Joe.
Operator: Please stand by for our next question. Our next question comes from the line of Jason Zemansky with Bank of America. Your line is open. Thank you.
Speaker Change: Please standby for our next question.
Speaker Change: Our next question comes from the line of Jason Szymanski with Bank of America. Your line is open.
Benjamin Halladay: Thank you. Good morning team. Congratulations on the quarter and thanks for taking our questions. I apologize if I missed this, but to what extent did stocking and inventory build contribute to the quarter's total? And then a follow-up, if I may.
Jason Nicholas Butler: Thank you good morning team congrats on the quarter and thanks for taking our questions I apologize if I missed this but.
Jason Nicholas Butler: What extent did stocking and inventory build contribute to the quarters total.
Jason Nicholas Butler: And then a follow up if I may.
Benjamin Halladay: Yeah, that's a short answer, Jason. It was none. No, no effect at the quarterly level.
Thats: Yes, Thats, a short answer Jason I'd say it was not.
Speaker Change: No no effect on quarterly level.
Benjamin Halladay: Got it. Perfect. And then what should we be thinking about growth to net trends as you start to bring more payers online, especially given the sizable patient population in primary prevention?
Benjamin Halladay: Got it.
Speaker Change: Got it perfect and then what should we be thinking about gross to net trends.
Speaker Change: As you start to bring more payers online.
Speaker Change: Especially given the sizable patient population and primary prevention.
Benjamin Halladay: Yeah, I can take that one also. So as far as gross to net goes for the year, you know, we expect it to follow the same cyclicality that we've seen in prior years. And as a reminder, Q1 is our best quarter, and Q4 is our worst, so it gets progressively worse over the year, largely driven by the Medicare coverage gap. As far as the actual percentage year over year, I would say it's going to be consistent.
Speaker Change: Yes, I think that when he also so as far as gross to net goes for the year. We expect it to follow the same cyclicality that we've seen in prior years and as a reminder, Q1 is our best quarter in Q4, there's a worst so it gets progressively worse over the year largely driven by the Medicare coverage gap.
Speaker Change: As far as the actual percentage year over year, I would say, it's going to be consistent.
Benjamin Halladay: You know, the payers updating towards the U.M. criteria and adding primary prevention doesn't necessarily change the rebate or any of the amount paid to them. It's just the indication that's covered. So as far as the actual gross to net number, we don't really see that changing materially year over year. It just follows the same cyclicality that it does.
Speaker Change: The payers updating toward the new criteria, especially I'm, adding that primary prevention doesn't necessarily change the rebate or any of the amount paid to them. It's just the indication that's covered so as far as the actual gross to net number we don't really see that changing materially year over year, just it will follow the same cyclicality.
Speaker Change: But it does every year.
Benjamin Halladay: I guess I was looking for more color as to whether or not payers were looking for more concessions, you know, again, given kind of the sizable shift in overall population, I guess, overall moving forward.
Speaker Change: Got it I guess I was looking for more color as to whether or not payers, we're looking for more concessions.
Speaker Change: Again, given kind of the sizable shift in overall population I guess overall moving forward.
Sheldon L. Koenig: I can take that, Jason. I mean, we've been very pleased, as Eric mentioned, with our interactions with our payers, and the short answer to that is also no. So, you know, and I think part of it is just based upon the alignment that we gained when we presented the data at ACC and went to them immediately. This is something that they've been prepared for, but there has not been a meaningful request as it relates to what our new label update is.
Speaker Change: I can take that Jason I mean, we've been very pleased as Eric mentioned with our interactions with our payers is the short answer to that is also now.
Sheldon L. Koenig: That's the answer I can give you. Got it. All right.
Speaker Change: So I think part of it is just based upon the alignment that we gained when we presented the data at ACC and went to them immediately.
Speaker Change: Something that they've been prepared for.
Speaker Change: But there has not been meaningful request as it relates to what our new label update is the best answer I can give you.
Operator: Got it. All right. Perfect. Thank you so much for the color.
Speaker Change: Got it alright, perfect. Thank you so much for the color.
Speaker Change: Thank you.
Sheldon L. Koenig: Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back over to Sheldon for his closing remarks.
Speaker Change: Ladies and gentlemen, I'm showing no further questions in the queue I would now like to turn the call back over to Sheldon for his closing remarks great.
Operator: Great. Thank you, Tawanda. Thank you, everyone, again, for your time and interest today. Again, we couldn't be more pleased with our first quarter performance, our label approval, and what it means for millions of primary and secondary prevention patients who are unable to achieve their LDL cholesterol goals with current therapies alone. We look forward to continuing to execute on our commercial plan and keeping you posted on our progress in the weeks and months ahead. Look for us as a host of investor conferences in the coming weeks. We have a really busy May in front of us. Take care and see all of you soon. Thank you again.
Sheldon L. Koenig: Great. Thank you to Wanda. Thank you everyone again for your time and interest today again, we couldnt be more pleased with our first quarter performance our label approval and for what they mean for millions of primary and secondary prevention patients who are unable to achieve their LDL cholesterol goals with current therapies alone.
Sheldon L. Koenig: We look forward to continuing to execute on our commercial plan and keeping you posted on our progress in the weeks and months ahead look for us at the host of Investor conferences in the upcoming weeks, we have a real busy may in front of us take care and see all of you soon thank you again.
Operator: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.
Speaker Change: Ladies and gentlemen, this concludes today's conference call. Thank you for your participation you may now disconnect.
Sheldon L. Koenig: Yeah.
Sheldon L. Koenig: Okay.
Sheldon L. Koenig: [music].
Sheldon L. Koenig: Okay.
Sheldon L. Koenig: Okay.
Sheldon L. Koenig: [music].
Sheldon L. Koenig: Okay.
Sheldon L. Koenig: Okay.
Sheldon L. Koenig: [music].
Sheldon L. Koenig: [music].
Sheldon L. Koenig: Sure.
Sheldon L. Koenig: So.
Sheldon L. Koenig: Hum.
Sheldon L. Koenig: [music].