Q4 2024 Beta Bionics Inc Earnings Call
Operator: Good afternoon and welcome to the Beta Bionics fourth quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session, and instructions will follow at that time. As a reminder, please be advised that today's conference is being recorded.
Good afternoon, and welcome to the beta Bionics fourth quarter 'twenty 'twenty four earnings conference call. At this time, all participants are in a listen only mode. After.
After the speaker's presentation, there will be a question and answer session and instructions will follow at that time.
As a reminder, please be advised that today's conference is being recorded.
Blake Beaver: I would now like to hand the conference over to Blake Beaver, Head of Investor Relations. You may begin. Thank you.
Speaker Change: I would now like to hand, the conference over to Blake Beaver head of Investor Relations you may begin.
Blake Beaver: Good afternoon and thank you for joining Beta Bionics fourth quarter and full year 2024 earnings call and our first earnings call as a public company. With me today are Sean Saint, Beta Bionics President and Chief Executive Officer, and Stephen Feider, Chief Financial Officer. Both the replay of this call and the press release discussing our 2024 results and 2025 guidance will be available on the Investor Relations section of our website. The replay will be available for approximately one month following the conclusion of this call.
Speaker Change: Thank you good afternoon, and thank you for joining beta bionics fourth quarter and full year 2024 earnings call and.
Speaker Change: And our first earnings call as a public company with me today are Shawn Thank beta bionics, President and Chief Executive Officer, and Stephen Fighter Chief Financial Officer.
Speaker Change: The replay of this call and the press release discussing our 2024 results and 2025 guidance will be available on the Investor Relations section of our website a replay will be available for approximately one month. Following the conclusion of this call information recorded on this call speaks only as of today March 25, 2025. Therefore.
Blake Beaver: Information recorded on this call speaks only as of today, March 25, 2025. Therefore, if you are listening to the replay, any time-sensitive information may no longer be accurate. Also on our website is our supplemental fourth quarter 2024 earnings presentation and updated corporate presentation. We encourage you to reference those documents for a summary of key metrics and business updates.
Speaker Change: If you are listening to the replay at any time sensitive information may no longer be accurate.
Speaker Change: Also on our website is our supplemental fourth quarter 2024 earnings presentation, an updated corporate presentation.
Speaker Change: Carriage you to reference those documents for a summary of key metrics and business updates.
Blake Beaver: Before we begin, we would like to remind you that today's discussion will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management's expectations about future events, our product pipeline, development timelines, financial performance, and operating plans. Please refer to the cautionary statements in the press release we issued earlier today, as well as our SEC filings, including our Form 10-K filed today, for a detailed explanation of the inherent limitations of such forward-looking statements. These documents contain and identify important factors that may cause actual results to differ materially from current expectations expressed or implied by our forward-looking statements.
Speaker Change: Before we begin we would like to remind you that today's discussion.
Speaker Change: Looking statements within the meaning of the private Securities Litigation Reform Act of 1995. These statements reflect management's expectations about future events, our product pipeline development timelines financial performance and operating plans.
Speaker Change: Refer to the cautionary statements in the press release, we issued earlier today as well as our SEC filings, including our Form 10-K filed today for a detailed explanation of the inherent limitations of such forward looking statements. These documents contain and identify important factors that may cause actual results to differ materially from current expectations expressed or implied by our forward looking.
Blake Beaver: Please note that the forward-looking statements made during this call speak only as of today's date and we undertake no obligation to update them to reflect subsequent events or circumstances except to the extent required by law.
Speaker Change: <unk>.
Speaker Change: Please note that the forward looking statements made during this call speak only as of today's date and we undertake no obligation to update them to reflect subsequent events or circumstances, except to the extent required by law todays.
Blake Beaver: Today's discussion will also include references to non-GAAP financial measures with respect to our performance, namely adjusted EBITDA. Non-GAAP financial measures are provided to give our investors information that we believe is indicative of our core operating performance and reflects our ongoing business operations. We believe these non-GAAP financial measures facilitate better comparisons of operating results across reporting periods. Any non-GAAP information presented should not be considered as a substitution independently or superior to results prepared in accordance with GAAP. Please refer to our earnings press release and supplemental earnings presentation on the investor relations section of our website for reconciliation of non-GAAP measures to their most directly comparable GAAP financial measure.
Speaker Change: Today's discussion will also include references to non-GAAP financial measures with respect to our performance, namely adjusted EBITDA non-GAAP financial measures are provided to give our investors information that we believe is indicative of our core operating performance and reflects our ongoing business operations.
Speaker Change: These non-GAAP financial measures facilitate better comparisons of operating results across reporting periods any non-GAAP information presented should not be considered as a substitution independently or superior to results prepared in accordance with GAAP. Please refer to our earnings press release and supplemental earnings presentation on the Investor Relations section of our web site for <unk>.
Speaker Change: <unk> of non-GAAP measures to their most directly comparable GAAP financial measure with that I'll now turn the call over to Sean.
Blake Beaver: With that, I'll now turn the call over to Thanks, Blake.
Sean Saint: Good afternoon and welcome to our first earnings call as a public company. We're excited to share with you today the details on our strong performance in the fourth quarter and full year 2024, as well as introduce our full year guidance for 2025. We'll also briefly review our technology, and as you'll see, we have multiple strategic initiatives underway, both commercially and in our pipeline, which we believe position the company well for success over the short, medium, and long term. Before we dive in, I'd like to take this opportunity to thank all of our investors who have supported Beta Bionics throughout our journey, and particularly those who supported Beta Bionics in our recent initial public offering and concurrent private placement, which together raised approximately $206 million in net proceeds.
Sean: Thanks, Blake good afternoon, and welcome to our first earnings call as a public company. We're excited to share with you today. The details on our strong performance in the fourth quarter and full year 2024, as well as introduce our full year guidance for 2025. We will also briefly review our technology and as you'll see we have multiple strategic initiatives underway.
Sean: Both commercially and in our pipeline, which we believe position the company well for success over the short medium and long term.
Before we dive in I'd like to take this opportunity to thank all of our investors who have supported beta bionics throughout our journey and particularly those who supported beta bionics and our recent initial public offering and concurrent private placement, which together raised approximately $206 million in net proceeds as a person living with type one I'd also like to thank the entire beta bionics team.
Sean Saint: As a person living with type 1, I'd also like to thank the entire Beta Bionics team. I feel that the future of diabetes management has never been brighter, and that is a testament to our unwavering dedication to people with diabetes and the broader diabetes community. Most of all, I'd like to thank our Community of Iowa users and the caregivers, family, friends, and health care providers who support them. Thank you for being part of our bionic universe and putting your trust in Beta Bionics and our mission to simplify and alleviate the burden of managing diabetes with life-changing solutions.
Sean: I feel that the future of diabetes management has never been brighter and that and that is a testament to our unwavering dedication to people with diabetes in the broader diabetes community most.
Sean: Most of all I'd like to thank our community of users and the caregivers family friends and health care providers, who support them.
Sean: For being part of our Bionic universe, and putting your trust in beta bionics, and our mission to simplify and alleviate the burden of managing diabetes with life changing solutions.
Sean Saint: While that burden reduction is certainly focused on those living with diabetes, it extends to what we call the four P's. The patient, the provider, the payer, and the pharmacist. We believe that easing the burden for each of these critical groups is key to our mission and scope.
Sean: While that burden reduction is certainly focused on those living with diabetes. It extends to what we call. The four PS the patient the provider the payer and the pharmacist, we believe that easing the burden for each of these critical groups is key to our mission and success.
Sean Saint: On today's call, I'll cover four important topics. First, our technology, the islet bionic pancreas, and the unmet needs we're addressing in diabetes. Next, I'll share the key milestones that Beta Bionics has achieved over the past two years to illustrate the progress we've made both commercially and clinically. Then, I'll discuss our fourth quarter and full year 2024 financial results, and lastly, review our innovation pipeline and our vision for the future. Stephen will provide additional details on our financial results and our full year 2025 guidance. We're going to cover lots of ground in our prepared remarks today, given this is our first earnings call, so bear with us.
Sean: On today's call I'll cover four important topics first our technology, the eyelet bionic pancreas and the unmet needs. We're addressing in diabetes next I'll share the key milestones that beta bionics has achieved over the past few years that illustrate the progress we've made both commercially and clinically.
Sean: Then I'll discuss our fourth quarter and full year 2024 financial results and lastly review, our innovation pipeline and our vision for the future.
Sean: Steven will provide additional details on our financial results and our full year 2025 guidance.
Speaker Change: To cover lots of ground in our prepared remarks today. Given this is our first earnings call So bear with us.
Sean Saint: Starting with our technology, it's important to first dive into the unmet needs we're looking to address. When insulin pumps were first developed, they were essentially glorified syringes. They gave a small amount of insulin every five minutes, which was important given the less than stellar insulins of the day. Over time, these systems evolved to include hybrid closed-loop algorithms, which increase or decrease insulin when needed to aid the user in managing their diabetes. And these systems work. But we have never fundamentally changed these systems to eliminate the complex setup and management that traditional pumps and hybrid closed-loop pumps require for physicians and users.
Speaker Change: Starting with our technology. It is important to first dive into the unmet needs. We're looking to address when insulin pumps were first developed they were essentially glorified syringes. They gave a small amount of insulin every five minutes, which was important given the less than stellar influence of the day.
Speaker Change: Over time. These systems evolve to include hybrid closed loop algorithms, which increase or decrease insulin when needed to aid the user and managing their diabetes and these systems work.
Speaker Change: We have never fundamentally changed these systems to eliminate the complex setup and management that traditional pumps and hybrid closed loop pumps require for physicians and users com.
Sean Saint: Complex for physicians, meaning the settings that are programmed into the pump on day one, including carb factors, correction factors, basal rates, and duration of insulin action, plus the modifications the physician makes to these settings each time they see the patient. and complex for the user, meaning daily burdens such as carb counting, manual correction boluses, extended boluses, and sometimes even modifications to the settings of the pump. That's why we developed the islet bionic pancreas, which we designed to cut through all that complexity without sacrificing outcome. Islet represents the first fundamental disruption of the user experience of insulin pumps for both the patient and the provider since their invention.
Speaker Change: Complex for physicians, meaning the settings that are programmed into the pump on day, one, including carb factors correction factors basal rates and duration of its an action plus the modifications the physician makes to the settings each time, they see the patient.
Speaker Change: And complex for the user meeting daily burdens, such as Carb counting manual correction bolus is extended bolus and sometimes even modifications to the settings of the pump.
Speaker Change: That's why we developed the island Bionic pancreas, which we designed to cut through all of that complexity without sacrificing outcomes.
Speaker Change: Pilot represents the first fundamental disruption of the user experience of insulin pumps for both the patient and the provider since their invention.
Sean Saint: With Islet, you enter your weight, and the system will learn and adapt to you. Doctors are no longer required to perform complex setup or modification of insulin settings, leaving their times better spent with the patient, not the patient. Users are no longer required to calculate boluses of any kind, to count carbs, or to modify their pump settings. They simply tell the pump they're eating a meal that's about usual for them, or more or less than normal, and Islet takes care of the rest as it determines and delivers 100% of all insulin doses. For all those reasons, we see Islet as a revolution in insulin pump technology.
Speaker Change: With eyelet I know your weight and the system will learn and adapt to you Dr.
Speaker Change: Doctors are no longer required to perform complex setup or modification of insulin settings, leaving their times better spent with the patient not the pump.
Speaker Change: Users are no longer required to calculate bonuses of any kind to count carbs or to modify their pump settings. They simply tell the pump they're eating a meal, that's about usual for them or more or less than normal and I'll. It takes care of the rest as it determines and delivers 100% of all insulin doses.
Speaker Change: For all those reasons, we see island as a revolution in insulin pump technology, but.
Sean Saint: But why was a revolution necessary, you might ask? Well, today, roughly 20% of adults living with type 1 diabetes in the United States meet or surpass the ADA target HbA1c of 7% or lower. While it's true that a certain sub-segment of users are able to reach goal today, far too many are not. I want to be very clear. IELTS is not about getting the absolute best outcomes for only the most educated, engaged, and motivated users out there. IELTS is about shifting the burden of managing diabetes from the user and provider to the pump. It's about democratizing great outcomes for everyone with diabetes, regardless of their knowledge of the disease, level of engagement, or access to a leading endocrinologist.
Speaker Change: Why was a revolution necessary you might ask what's.
Speaker Change: Today, roughly 20% of adults living with type one diabetes in the United States meet or surpass the 88 target HBA when fee of 7% or lower.
Speaker Change: While it is true that a certain sub segment of users are able to reach goal today far too many or not I want to be very clear I'll, let is not about getting the absolute best outcomes for only the most educated engaged and motivated users out there island is about shifting the burden of managing diabetes from the user and <unk>.
Speaker Change: <unk> to the pump, it's about democratizing, great outcomes for everyone with diabetes, regardless of their knowledge of the disease level of engagement or access to our leading endocrinologist. We believe that the island may be the only pump system today that is capable of improving diabetes outcomes at the population level something thats been <unk>.
Sean Saint: We believe that the islet may be the only pump system today that is capable of improving diabetes outcomes at the population level, something that's been lacking to this point despite the numerous technological leaps in insulin pumping that have been made over the last 30 years.
Speaker Change: To this point despite the numerous technological leaps in insulin pumping that have been made over the last 30 years.
Sean Saint: In terms of where we are in our journey, the last two years have been transformational for Beta Bionics. In May of 2023, we launched the iLib Bionic Pancreas with the goal of enabling people with diabetes to manage their diabetes with less work, but without sacrificing outcome. For the full year 2023, over 2300 users adopted our technology and we generated $12 million of net sales with a gross margin of 52.6%. despite being in our relative infancy as a commercial stage company. We also pioneered a new business model, and to our knowledge, the islet became the first durable insulin pump to be eligible for pharmacy channel reimbursement when we announced our formulary contract with Express Scripts in the fourth quarter of 2023.
Speaker Change: In terms of where we are in our journey.
Speaker Change: Last two years have been transformational for beta bionics in May of 2023, we launched the eyelet bionic pancreas with a goal of enabling people with diabetes to manage their diabetes with less work, but without sacrificing outcomes for the full year 2023 over 'twenty 300 users adopted our technology and we generated 12 million.
<unk> of net sales with a gross margin of 52, 6%.
Speaker Change: Despite being on a relative infancy as a commercial stage company.
Speaker Change: We also pioneered a new business model and to our knowledge. The eyelet became the first durable insulin pump to be eligible for pharmacy channel reimbursement, when we announced our formulary contract with Express express scripts in the fourth quarter 2023.
Sean Saint: That's an important initiative for our business and one that we'll describe in more detail later in the call.
Speaker Change: That's an important initiative for our business and one that will describe in more detail later in the call.
Sean Saint: 2024 was a phenomenal moment in building year for Beta. I'd like to highlight a few of the many milestones we achieved. Close to 13,000 more new users adopted our technology, including over 4,000 new users in the fourth quarter alone, and we're proud of the profound impact that the islet is already having on people with diabetes and the broader diabetes community. We continued to make progress in securing more formulary contracts that expanded pharmacy coverage and reimbursement for the islet, most notably our contract with CVS Caremark, which we signed in the fourth quarter of 2024. We derived our first year of real-world evidence for ILIT with data from 3,300 users.
Speaker Change: 2024 was a phenomenal momentum building year for beta I'd like to highlight a few of the many milestones we achieved.
Speaker Change: 13000, more new users adopted our technology, including over 4000, new users in the fourth quarter alone and we're proud of the profound impact that the island is already having on people with diabetes and the broader diabetes community.
Speaker Change: We continued to make progress in securing more formulary contracts that expanded pharmacy coverage and reimbursement for the eyelet, most notably our contract with Cvs Caremark, which we signed in the fourth quarter of 2024.
Speaker Change: We derived our first year of real world evidence for islet with data from 3300 users want to be clear if we had to users' data baseline even see in at least three weeks of CGM data upload a dark cloud. They were included in this dataset.
Sean Saint: I want to be clear, if we had a user's data, meaning baseline A1C and at least three weeks of CGM data uploaded to our cloud, they were included in this data set. Consistent with our goal of improving population health, we believe that it's more important to show data for the entire population rather than a certain subset of users based on specific settings or use requirements that are more likely to produce favorable outcomes. The evidence in our real-world data set demonstrated ILIT's effectiveness in a large and diverse real-world population, driving meaningful changes from 8.5% baseline A1c to follow-up GMI of 7.3%, GMI meaning glucose management indicator, which is a proxy for A1c.
Speaker Change: Consistent with our goal of improving population health, we believe that it's more important to show data for the entire population rather than a certain subset of users based on specific settings or use requirements that are more likely to produce favorable outcomes. The.
Speaker Change: The evidence in our real World data set demonstrated eyelets effectiveness and a large and diverse real world population driving meaningful changes from eight 5% baseline ANC to followup GMI of seven 3% GMI, meaning glucose management indicator, which is a proxy for a Wednesday.
Sean Saint: Although the real-world dataset wasn't prospectively designed to assess this, we believe the dataset is the first in diabetes interventions that we're aware of, including pumps, CGMs, and smart pens, that seem to indicate that improved glycemic outcomes were achieved independent of user engagement, which reinforces our technology's differentiation and appeal to people with To further highlight that point, we recently ran an additional analysis of our real-world data to better understand how the islet is being used in a fully closed-loop manner, which for purposes of this analysis we define as users who announced less than one meal per day on average over the past 30 days.
Speaker Change: Although the real World data set wasn't prospectively designed to assess this we believe the data set is the first in diabetes interventions that we're aware of including pumps CGM and smart pens that seem to indicate that improved glycemic outcomes were achieved independent of user engagement, which reinforces our technology differentiation and.
Speaker Change: <unk> to people with diabetes.
Speaker Change: To further highlight that point, we recently ran an additional analysis of our real world data to better understand how the island is being used in a fully closed loop manner, which for purposes of this analysis, we defined as users who announced less than one meal per day on average over the past 30 days I want to be clear again, if we had a user's baseline even.
Sean Saint: I want to be clear again, if we had a user's baseline A1C data and they uploaded their data to our cloud in the 30-day period ending March 18th, they were included in this dataset. Unlike sub-segmenting real-world datasets in ways that are likely to produce more favorable outcomes versus the broader real-world user base, this subset of fully closed-loop islet users makes sense for us to carve out because you typically expect their outcomes to reflect unfavorably relative to the broader user base's data. Of course, this analysis is just an ad hoc analysis of our real-world data and doesn't come from a prospective study of islet closed-loop safety and that Of the users we have this data for, we found that 15% of them, or close to 1,400 users, met the criteria for using the islet in a fully closed-loop manner.
Speaker Change: <unk> data and the uploaded their data to our cloud and then the 30 day period ending March 18th they were included in this dataset.
Speaker Change: Unlike unlike sub segmenting real world data sets in ways that are likely to produce more favorable outcomes versus the broader real world user base. This subset of fully closed loop pilot users makes sense for us to carve out because you typically expect their outcomes to reflect unfavorable relative to the broader users user basis data.
Speaker Change: Of course. This analysis is just an AD hoc analysis of our real world data and doesn't come from a prospective study of islet closed loop safety and efficacy.
Speaker Change: Of the users we have this data for we found that 15% of them or close to 1400 users met the criteria for using the island in a fully closed loop manner.
Sean Saint: On average, those users announced roughly one meal every three days and went from an average baseline A1c of 9.3% to a follow-up GMI of 7.4%, or close to a 2% improvement. The high baseline A1C suggests that this user population likely was not engaging much in their pre-ISLET diabetes care. And based on this data, it appears that they've continued that low level of engagement in their care with ISLET. But we were able to achieve much better results. They experienced an even greater improvement in baseline A1C to average GMI than our overall user base, and their follow-up GMI of 7.4% was very similar to the 7.3% that we saw in our first year of real-world evidence for all ISLET users that we had data for.
Speaker Change: On average those users announce roughly one meal every three days and went from an average baseline <unk> of nine 3% to a follow up GMI of seven 4% or close to a 2% improvement.
Speaker Change: The high baseline even see suggests that this user population likely was not engaging much in their pre islet diabetes care and based on this data. It appears that they've continued that low level of engagement and their care with eyelet, but we were able to achieve much better results. They experienced an even greater improvement baseline even see.
Speaker Change: To average GMI that our overall user base and their follow up GMI, a seven 4% was very similar to the seven 3% that we saw in our first year of real world evidence for all islet users that we have data for.
Sean Saint: What I hope you take away from these data is our belief that we have the most advanced algorithm on the market when it comes to operating in a fully closed-loop manner, which again speaks to ILIT's unique algorithm and appeal to people with diabetes.
Speaker Change: But I hope you take away from these data is our belief that we have the most advanced algorithm on the market. When it comes to operating in a fully closed loop manner, which again speaks to <unk> unique algorithm and appeal to people with diabetes.
Sean Saint: Shifting away from our real-world evidence in 2024, we also launched a number of new products, particularly in the back half of the year. which contributed to our strong performance in 2024 and which we also expect to contribute to our performance in 2025. Last, but certainly not least, we continue to advance our pipeline, including our patch pump program and our biohormonal pump program, the latter of which we achieved a major milestone for when we signed the exclusive collaboration and licensing agreement with Zara's Pharmaceuticals and completed pump compatibility testing for their proprietary glucagon formulation for use in Beta Bionics biohormonal pump configuration.
Speaker Change: Shifting away from our real World evidence in 2024, we also launched a number of new products, particularly in the back half of the year.
Speaker Change: Which contributed to our strong performance in 2024, and which we also expect to contribute to our performance in 2025.
Speaker Change: Last but certainly not least we continue to advance our pipeline, including our patch pump program entered by hormonal pump program. The latter of which we achieved a major milestone for when we signed the exclusive collaboration and licensing agreement with <unk> Pharmaceuticals, and completed pump compatibility testing for their proprietary glucagon formulation for use in beta bionics.
Sean Saint: These are all fantastic achievements and a major credit to our employees' relentless execution and dedication.
Speaker Change: Hormonal pump configuration. These are all fantastic achievements in a major credit to our employees relentless execution and dedication.
Sean Saint: Shifting now to a brief overview of our fourth quarter and full year 2024 results. For the full year, I'm proud to announce that we delivered $65.1 million in net sales, which represents 443% growth year over year. Our gross margin was 55.1%, and we continue to be encouraged by our gross margin relative to our scale, especially considering our shift to the pharmacy channel weighs on our gross margin in the near term. In the fourth quarter, we generated $20.4 million in net sales, which represents 145% growth year over year. Our gross margin was 57.2%. As we will discuss in more detail later in the call, our strong performance in the fourth quarter was driven by continued momentum in new patient starts, resulting from robust demand for the islet, new product launches, and seasonality.
Speaker Change: Shifting now to a brief overview of our fourth quarter and full year 2024 results.
Speaker Change: For the full year I'm proud to announce that we delivered $65 $1 million in net sales, which represents 443% growth year over year.
Speaker Change: Our gross margin was 55, 1% and we continue to be encouraged by our gross margin relative to our scale, especially considering our shift to the pharmacy channel weighs on our gross margin in the near term.
Speaker Change: In the fourth quarter, we generated $24 million in net sales, which represents 145% growth year over year.
Speaker Change: Our gross margin was 57, 2%.
Speaker Change: As we will discuss in more detail later in the call our strong performance in the fourth quarter was driven by continued momentum in new patient starts resulting from robust demand for the eyelet, new product launches and seasonality.
Sean Saint: And, while shifting more of our business to the pharmacy channel negatively impacted our net sales for the quarter, our new patient starts certainly benefited from the shift to pharmacy, as users are able to access the pump with minimal out-of-pocket costs. As Stephen will discuss in greater detail, as our business shifts toward pharmacy, we expect that to negatively impact net sales and gross margin in the near term, but is accretive to our business over the long run.
Speaker Change: And while shifting more of our business to the pharmacy channel negatively impacted our net sales for the quarter, our new patient starts certainly benefited from the shift departments C. As users are able to access the pump with minimal out of pocket costs.
Speaker Change: As Stephen will discuss in greater detail as our business shifts towards pharmacy, we expect that to negatively impact net sales and gross margin in the near term, but it is accretive to our business over the long run.
Sean Saint: Before I hand it over to Stephen, I'd like to discuss our innovation pipeline. Innovation and speed are at the heart of everything we do. We firmly believe we've developed the most advanced insulin pump system on the market with a highly competitive form factor within the durable pump category. Following our CGM integrations with both Dexcom G6 and G7 in 2023, in November of 2024, we became the first insulin pump in the U.S. to be integrated with Abbott's Freestyle Libre 3+. In September 2024, we also launched our Bionics Circle mobile application, a remote monitoring experience which allows a caregiver to see a user's islet data and monitor performance, a particularly important capability for parents and children with diabetes who are using islets.
Before I hand, it over to Stephen I'd like to discuss our innovation pipeline innovation and speed are at the heart of everything we do we firmly believe we have developed the most advanced insulin pump system on the market with a highly competitive form factor within the durable pump category.
Speaker Change: Following our CGM integrations with both <unk> six and <unk>, 7% in 2023 in November of 2024, we became the first insulin pump in the U S to be integrated with Abbott freestyle Libre three plus.
Speaker Change: In September 2024, we also launched our Bionic circle mobile application.
Speaker Change: Monitoring experience, which allows a caregiver to see a user's islet data and monitor performance are they particularly important capability for parents and children with diabetes, who are using islands.
Sean Saint: The list goes on, but I want to take this opportunity to highlight two key R&D programs that we're working on. Number one is our patch pump, which we expect to commercialize by the end of 2027. The patch is a two-part design with one disposable and one reusable component that we believe has the potential to be advantageous for our users because it will offer a more seamless patch change experience versus fully disposable designs, and advantageous for our business from both the reimbursement channel and cost-effectiveness perspective. The patch pump will be paired with the same FDA approved algorithm that powers the islet, which we already discussed the substantial advantages of for the user and physician.
Speaker Change: The list goes on but I want to take this opportunity to highlight two key R&D programs that we're working on now.
Speaker Change: Number one is our patch pump, which we expect to commercialize by the end of 2027.
Speaker Change: The patch is a two part design with one disposable and one reusable component that we believe has the potential to be advantageous for our users because it will offer a more seamless patch change experience versus fully disposable designs.
Speaker Change: And advantageous for our business from both the reimbursement channel and cost effectiveness perspective.
Speaker Change: The patch pump will be paired with the same FDA approved algorithm the powers, the eyelet, which we already discussed the substantial advantages out for the user and position.
Sean Saint: The other key project we're working on is our biohormonal pump, which would deliver both insulin to bring your blood sugar down and glucagon to bring it back up. similar to how the gas and brakes work in a car. As I mentioned before, we exclusively own the rights to our glucagon product and are therefore responsible for its development and commercialization. In the past, we've conducted three pre-pivotal inpatient and six pre-pivotal outpatient clinical trials, studying the biohormonal configuration of the islet, and achieved reduced hypoglycemia and increased time and range relative to both standard of care treatment and our insulin-only configuration of the islet.
Speaker Change: The other key projects, we're working on is our by hormonal pump, which would deliver both insulin to bring your blood sugar down and glucagon to bring it back up.
Speaker Change: Similar to how the gas and brakes work in a car.
Speaker Change: As I mentioned before we exclusively on the rights to our glucagon product and are therefore responsible for its development and commercialization and.
Speaker Change: In the past we've conducted three pre pivotal inpatient and six pre pivotal outpatient clinical trials studying the buyer hormonal configuration of the eyelet and achieve reduced hypoglycemia and increased time and range relative to both standard of care treatment and our insulin only configuration of the island.
Sean Saint: Importantly, this project is not just about improving clinical outcomes like time and range or A1C reduction. It's also not about giving a rescue dose of glucagon in emergency situations only. It's about incorporating glucagon as a consistent mechanism to support blood glucose control in a similar way to how a functioning pancreas With that, we may have greatly reduced the burden of living with diabetes, especially the mental burden that so many people with diabetes live with because they are in constant fear of hypoglycemia or low blood sugar. So that's what this biohormonal project's all about, substantially reducing the burden of diabetes.
Speaker Change: Importantly, this project is not just about improving clinical outcomes like time and range or you won't see reduction. It's also not about giving a rescue to us of glucagon in emergency situations only.
Speaker Change: It's about incorporating glucagon as a consistent mechanism to support blood glucose control in a similar way to how a functioning pancreas would work.
Speaker Change: With that we may have greatly reduced the burden of living with diabetes, especially the mental burden that so many people with diabetes liquid because they're in constant fear of hypoglycemia or low blood sugar.
Speaker Change: So that's despite a hormonal projects all about substantially reducing the burden of diabetes in terms of our path to market. While it may seem abbreviated when I walked through at the moment, it's important to remember that we've run a number of pre pivotal inpatient and outpatient clinical trials studying by hormonal that tape back to 2008. So.
Sean Saint: In terms of our path to market, while it may seem abbreviated when I walk through it in a moment, it's important to remember that we've run a number of pre-pivotal inpatient and outpatient clinical trials studying biohormonal that date back to 2008. So we've developed a robust clinical data set on biohormonal dating back over 16 years. That data set includes the first outpatient trial on a mobile platform of a closed-loop blood glucose control system that we're aware of, known as the Beacon Hill Study, which was conducted in 2013. Now to take you through the steps that we believe are required to get our bihormonal system, including glucagon, to market.
Speaker Change: So we've developed a robust clinical data set in by hormonal dating back over 16 years.
Speaker Change: That dataset and includes the first outpatient trial on a mobile platform or a closed loop blood glucose control system that we're aware of known as the <unk> study, which was conducted in 2013.
Now to take you through the steps that we believe are required to get our by hormonal system, including <unk> gone to market.
Sean Saint: At a minimum, we believe we'll need to run a PK-PD trial to bridge all of our previous clinical data to this new formulation of glucagon from Xeris. Then we're planning to conduct a one-year drug pivotal trial to fulfill the requirements for a chronic drug indication and a concurrent six-month device pivotal trial. These will be followed by ACE and IAGC 510Ks for the pump and algorithm, as well as what we currently believe will be a 505B2 NDA application for the drug.
Speaker Change: At a minimum we believe we will need to run a PK PD trial to bridge all of our previous clinical data. So this new formulation of glucagon from service.
Speaker Change: Then we are planning to conduct a one year drug pivotal trial to fulfill the requirements for a chronic drug indication and a concurrent six month device pivotal trial. This will be followed by a <unk> 510-Ks for the pumping algorithm as well as what we currently believe will be a 505 <unk> NDA application for the drug.
Sean Saint: If we're successful in getting the biohormonal system to market, we expect that we'll have a truly revolutionary therapy that completely changes the way people think about managing their diabetes.
Speaker Change: If we're successful in getting the buy hormonal system. The market. We expect that we'll have a truly revolutionary therapy that completely changes the way people think about managing their diabetes.
Sean Saint: As a company, we're extremely excited by both of these key pipeline programs and believe each represents a unique and important vehicle to help us deliver life-changing innovations to the people who need them most.
Speaker Change: As a company we're extremely excited by both the beef key pipeline programs and believe each represents a unique and important vehicle to help us deliver life changing innovations to the people who need them.
Sean Saint: The last piece of the pipeline that I'd like to briefly touch on today is the Type 2 label expansion opportunity. While we aren't disclosing timelines for that project at this time, I would like to mention that there are some health care providers today that decide to prescribe Islet to their Type 2 patients off-label. And in the second half of 2024, over 20% of our new patient starts were type 2. While we aren't necessarily going to share that metric consistently each quarter prior to obtaining a type 2 indication, we feel it's an important metric to highlight on this call to give you all a better sense of how the islet is being used in the real world.
Speaker Change: The last piece of the pipeline that I'd like to briefly touch on today is the type two label expansion opportunity.
Speaker Change: While we arent disclosing timelines for that project at this time I would like to mention that there are some health care providers today that decided to prescribe islet to their type two patients off label.
Speaker Change: And in the second half of 2020 for over 20% of our new patient starts were type two.
Speaker Change: While we aren't necessarily going to share that metric consistently each quarter prior to obtaining a type two indication we feel it's an important metric to highlight on this call to give you all a better sense of how the island is being used in the real world.
Sean Saint: As we think about the future type 2 opportunity, we believe the two most important elements that drive adoption are, number one, a product that is well suited to the type 2 population and the providers that manage them, most of which are primary care providers, and number two, pharmacy coverage. We estimate that pump penetration in the insulin-intensive type 2 population is less than 10% because current products aren't well-suited for those users and providers because they are too complex to set up and manage. A product that's well suited to the type 2 population would be easy to set up and require minimal engagement from the user and minimal management by the physician, which again is typically a primary care physician.
Speaker Change: As we think about the future type two opportunity. We believe the two most important elements that drive adoption are number one a product that is well suited to the type two population and the providers that manage them. Most most of which are primary care providers and number two pharmacy coverage, we estimate that pump penetration in the insulin intensive type two population.
Speaker Change: <unk> is less than 10% because current products arent well suited for those users and providers because they are too complex to set up and manage.
Speaker Change: A product that's well suited to the type two population would be easy to set up and require minimal engagement from the user and minimal management by the physician, which again is typically a primary care physician.
Sean Saint: Pharmacy coverage is also important because it's typically more difficult for a type 2 patient to get a pump through the DME channel relative to the pharmacy channel. So it isn't surprising to us that the pump with the most type two adoption is our competitor that's exclusively reimbursed through pharmacy, despite not having a type two indication until recently. So, as we think about our strategy for the Type 2 opportunity, we believe the islet may prove to be more suited than any other pump on the market for that population. The islet's easy to set up and manage, requires minimal engagement from the user, and we have clinical evidence that demonstrates that primary care providers were able to deliver comparable outcomes on islet versus endocrinologists, which really underscores our belief that islet will resonate very well in a primary care setting.
Speaker Change: Pharmacy coverage is also important because it is typically more difficult for a type two patient to get a pump through the <unk> channel relative to the pharmacy channel. So it isn't surprising to us that the pump or the most type two adoption as our competitor that's exclusively reimbursed through pharmacy, despite not having a type two indication until recently.
Speaker Change: So as we think about our strategy for the type two opportunity. We believe the island may prove to be more suited than any other pump in the market to that population the islands easy to set up and manage requires minimal engagement from the user and we have clinical evidence that demonstrates that primary care providers were able to deliver comparable outcomes on island versus endocrine.
Speaker Change: <unk>, which really underscores our belief that island will resonate very well in primary care setting.
Sean Saint: Also, the islet's currently reimbursed through the pharmacy for some patients, and we expect pharmacy adoption for the islet to continue to grow in the future, as Steven will discuss shortly in more detail. Beyond that, we look forward to pursuing the Type 2 label through the FDA.
Speaker Change: So the island's currently reimbursed through the pharmacy for some patients and we expect pharmacy adoption for the island to continue to grow in the future as Stephen will discuss shortly in more detail.
Speaker Change: Beyond that we look forward to pursuing the type two label through the FDA.
Sean Saint: As we enter 2025, having recently started our new life as a public company, we couldn't be more excited for the road ahead. We exited 2024 with significant momentum and expect that to carry into 2025 as we continue to expand the commercial reach of the islet while advancing our key pipeline program.
Speaker Change: As we enter 2025, having recently started our new life as a public company, we couldnt be more excited for the road ahead, we exited 2024 with significant momentum and expect that to carry into 2025 as we continue to expand the commercial reach of the island, while advancing our key pipeline programs.
Stephen Feider: With that, I'll turn the call over to Stephen, our Chief Financial Officer, to cover our fourth quarter results in more detail and discuss our full year guidance for 2025. Thanks, Sean, and not bad for a first earnings call. As Sean mentioned, in Q4 of 2024, we saw over 4,000 new patient starts on the islet, a 125% increase from approximately 1,800 new patient starts in the same period of the prior year, and an increase of 28% relative to the third quarter of the same year. Approximately two-thirds of people with type 1 diabetes in the U.S. and over 90% of people with type 2 diabetes.
I'll turn the call over to Steven our Chief Financial Officer to cover our fourth quarter results in more detail and discuss our full year guidance for 2025 steel.
Steven: Thanks, Sean and not bad for our first earnings call.
Steven: As Sean mentioned in Q4 of 2024, we saw over 4000, new patients starts on the island of 125% increase from approximately 800, new patient starts in the same period of the prior year and an increase of 28% relative to the third quarter of the same year.
Steven: Approximately two thirds of people with type one diabetes in the U S and over 90% of people with type two diabetes still use multiple daily injections or MDI as their preferred approach to care.
Stephen Feider: still use multiple daily injections, or MDI, as their preferred approach to care. In the fourth quarter, an estimated 70% of our new patient starts came from MDI, and we've seen that trend remain relatively stable over the last few quarters.
Steven: In the fourth quarter, an estimated 70% of our new patient starts came from MDI and we've seen that trend remained relatively stable over the last few quarters.
Stephen Feider: I hope you take away a few things from this. Number one, we are meaningfully expanding the market for insulin pumps because of our unique technology. Number two, islet isn't just for the early adopters of technology. We are often winning patients who otherwise would not use an insulin pump if the islet did not exist. And number three, we believe Islet addresses an unmet need in the market. Net sales for the fourth quarter of 2024 were $20.4 million, representing an increase of 145% from $8.4 million in the fourth quarter of 2023, and an increase of 22% relative to the third quarter of 2023.
Steven: I hope you take away a few things from this metric.
Steven: One we are meaningfully expanding the market for insulin pumps because of our unique technology.
Steven: Number two <unk> isn't just for the early adopters of technology, we are often winning patients who otherwise would not use an insulin pump if the island did not exist and number three we believe island addresses an unmet need in the market.
Steven: Net sales for the fourth quarter of 2024 or $24 million, representing an increase of 145% from $8 $4 million in the fourth quarter of 2023, and an increase of 22% relative to the third quarter of 2024.
Stephen Feider: Our performance was driven by our growth in new users combined with strong retention of our existing installs.
Steven: Our performance was driven by our growth in new users combined with strong retention of our existing installed base. We're proud of these results and they are showing us that the strategic moves we're making to compete at the highest level are the right ones.
Stephen Feider: We're proud of these results, and they're showing us that the strategic moves we're making to compete at the highest level are the right ones. I'll dig into those strategic moves one by one, as well as share some additional factors that contributed to our strong performance in the fourth quarter, most of which we expect to sustain into 2025.
Steven: I'll dig into those strategic moves one by one as well as share. Some additional factors that contributed to our strong performance in the fourth quarter, most of which we expect to sustain into 2025.
Stephen Feider: Let's start with new products. In September, we launched Bionic Circle, which is a remote monitoring experience that allows a caregiver to see a user's islet data and monitor performance. everything from blood glucose levels, insulin dosing, meal announcements, and all the things that you would want to see as a caregiver, especially if you are a parent of a child who has type 2 diabetes. Then in October, we launched the Color Islet, which we believe is a highly competitive form factor relative to other durable insulin pump islets. Then in November, we also became the first and only insulin pump in the U.S.
Steven: Let's start with new products in September we launched Bionic circle, which is a remote monitoring experience that allows the caregiver to CA users islet data and monitor performance everything from blood glucose levels insulin dosing, Neil announcements and all the things that you would want to see is a caregiver, especially if you are parents of a child, who has type one.
Steven: And.
Steven: Then in October we launched the color Island, which we believe is a highly competitive form factor relative to other durable insulin pump options.
Steven: And in November we also became the first and only insulin pump in the U S to integrate with freestyle Libre three plus.
Stephen Feider: to integrate with Freestyle Libre 3. We're in the very early stages of seeing all of those launches gain traction and pull through in our numbers, so we're excited for the impact they may have moving forward. Another tailwind for new user adoption in the fourth quarter was our increasing pharmacy channel mix, which enables our users who are covered by pharmacy to get the islet for little to no out-of-pocket cost relative to the durable medical equipment, or DME channel, where users typically have to pay a considerable amount out-of-pocket to purchase a durable instrument.
Steven: We're in the very early stages of seeing all of those launches gained traction and pull through in our numbers. So we're excited for the impact they may have moving forward.
Steven: Another tailwind for new user adoption in the fourth quarter was our increasing pharmacy channel mix, which enables our users who are covered by pharmacy to get the island for little to no out of pocket cost relative to the durable medical equipment or <unk> channel, where users typically have to pay a considerable amount out of pocket to purchase a durable insulin pump.
Stephen Feider: I want to back up for a moment and provide a little more color on the difference between these two revenue channels and why we chose to pioneer the pharmacy channel for durable insulin. This section is a bit dense with details, so bear with me. The DME and Pharmacy Channel have massively different revenue models, and understanding their differences is critical to understanding our business. The DME channel is the traditional reimbursement channel for durable insulin pumps. In this model, users and payers pay a lump sum upfront to Beta Bionics to purchase the pump and then pay a smaller monthly fee for the pump supply.
Steven: I want to backup for a moment and provide a little more color on the difference between these two revenue channels and why we chose to pioneer the pharmacy channel for durable insulin pumps.
Steven: <unk> is a bit dense with detailed so bear with me.
Steven: The <unk> pharmacy channel have massively different revenue models and understanding their different differences is critical to understanding our business.
Steven: The <unk> channel is the traditional reimbursement channel for durable insulin pumps and this model users and payers pay a lump sum upfront a beta bionics to purchase the pump and then pay a smaller monthly fee for the pump supplies.
Stephen Feider: user and payer are locked into the pump typically for four years before the user is able to switch to another pump if they'd like to. By contrast, the Pharmacy Model is a pay-as-you-go model, so users and payers only pay for the monthly pump supplies and pay nearly zero for the pump itself. Additionally, users are not locked into a four-year commitment. pharmacy model is advantageous for users who pay much less out-of-pocket to access the pump and spend less money on monthly supplies. it's less burdensome for providers to write prescriptions and get them approved in pharmacy, and the user gets the pump faster as a result.
Steven: User and payer are locked into the pump typically for four years before the users able to switch to another pump if they'd like to buy.
Steven: By contrast, the pharmacy model is a pay as you go model, so users and payers only pay for the monthly pumps supplies and paid nearly zero for the pump itself. Additionally.
Steven: Additionally, users are not locked into a four year commitment.
Steven: The pharmacy model is advantageous for users who pay much less out of pocket taxes, the pump and spend less money on multi supply supplies.
Steven: It's less burdensome for providers to write prescriptions and get them approved and pharmacy and user gets the pump faster as a result.
Stephen Feider: For payers, they don't have to police pump commitments when members switch between plans, and as a result, they're only ever paying for a pump that someone is actually using and getting the benefit. For Beta Bionics, pharmacy allows us to offer the islet through a reimbursement channel that aligns with our stakeholders' needs and the channel is accretive to our financials on the top and bottom line in the medium and long term. I want to highlight that last point, accretive to our financials on the top and bottom line in the medium and long term. As an illustrative example, Beta Bionics recognizes roughly $3,500 of revenue when we sell the pump through DME and roughly $70 per month for the pump supplies.
Steven: For payers, they don't have to police pumped commitments when members switch between plans and as a result, they are only ever paying for a pump at someone who is actually using and getting the benefit from.
Speaker Change: For beta Bionics pharmacy allows us to offer the island through a reimbursement channel that aligns with our stakeholders needs and the channel is accretive to our financials on the top and bottom line in the medium and long term.
Speaker Change: I want to highlight that last point accretive to our financials on the top and bottom line in the medium and long term.
Speaker Change: As an illustrative example, beta bionics recognized as roughly $3500 of revenue when we sell the pumps <unk> and roughly $70 per month for the pump supplies by contrast in pharmacy beta bionics recognizes roughly $0 of revenue when we sell a pump and roughly $450 per month, when we sell the monthly supply kits because.
Stephen Feider: By contrast, in pharmacy, Beta Bionics recognizes roughly $0 of revenue when we sell the pump and roughly $450 per month when we sell the monthly supply. Because we don't collect the lump sum payment up front for the pump in the pharmacy channel like we would in the DME channel, growth in pharmacy adoption is actually a drag on revenue in the near term relative to the DME channel. It's also a drag on our gross margin because we recognize all the cost of goods sold for the pump up front in both models. If a new user starts on the islet in the pharmacy channel, that doesn't become accretive to our financials relative to the DME channel until about the 11 month mark, at which time it becomes the most attractive reimbursement channel for Beta Bionics financials.
Speaker Change: We don't collect a lump sum payment upfront for the pump in the pharmacy channel like we would in the <unk> channel growth in pharmacy adoption adoption is actually a drag on revenue in the near term relative to the <unk> channel. It's also a drag on our gross margin because we recognize all the cost of goods sold for the pump upfront in both models.
Speaker Change: If a new user starts on the island in the pharmacy channel that doesn't become accretive to our financials relative to the <unk> channel until about the 11 month, Mark at which time it becomes the most attractive reimbursement channel for beta bionics financially.
Stephen Feider: Now let's talk about our Progress Informer. In the fourth quarter, we saw a nice increase in our pharmacy channel. A low teens percentage of our new patient starts were reimbursed through pharmacy in the quarter as compared to a high single-digit percentage in the third quarter and a mid-single-digit percentage in the first two quarters of 2024. I want to remind you that this increase in pharmacy mix is a tailwind for our new patient starts as it enhances our access to the product, but it has a transitory headwind for our revenue and gross margin that eventually flips into a tailwind after roughly month 11 for the Going forward, we'll continue to share our pharmacy new patient starts as a percentage of our total new patient starts, because we believe this is the right metric to truly understand pharmacy.
Speaker Change: Now, let's talk about our progress in pharmacy in.
Speaker Change: In the fourth quarter, we saw a nice increase in our pharmacy channel mix, a low teens percentage of our new patient starts were reimbursed through pharmacy in the quarter as compared to a high single digit percentage in the third quarter and a mid single digit percentage in the first two quarters of 2024 I want to remind you that this increase in pharmacy mix as a tail.
Speaker Change: And for our new patient starts as it enhances our access to the product, but it is a it has a transitory headwind for our revenue and gross margin that eventually flips into a tailwind after roughly month 11 for the reasons I already discussed.
Speaker Change: Going forward, we'll continue to share our pharmacy, new patient starts as a percentage of our total new patient starts because we believe this is the right metrics to truly understand pharmacy coverage.
Stephen Feider: The less relevant metric is the percentage of covered lives in pharmacy, which accounts only for formulary placement through PBM contracts and not downstream adoption by the underlying health plans that partner with the PBM. Lastly and importantly the pharmacy reimbursement channel is our preferred revenue channel because it is the most profitable channel in the medium and long term. Beta Bionics sends every patient that we can through the pharmacy channel. We check each patient's insurance for pharmacy coverage. If they're covered, we send them through pharmacy. If they're not, we send them through DMV.
Speaker Change: A less relevant metric as a percentage of covered lives in pharmacy, which accounts only for formulary placement through PGM contracts and not downstream adoption by the underlying health plans that partner with the PVM.
Speaker Change: Lastly, and importantly, the pharmacy reimbursement channel is our preferred revenue channel because it is the most profitable channel in the medium and long term.
Beta Bionics: Beta bionics sends every patient that we can through the pharmacy channel, we checked each patient's insurance for pharmacy coverage, if theyre covered we send them through pharmacy, if they're not we send them through DMV.
Stephen Feider: The last factor I would like to call out as it pertains to our Q4 revenue performance this season. The fourth quarter tends to be the strongest in our industry as deductibles and out-of-pocket maximums are met such that a pump purchase is no longer constrained by out-of-pocket costs. We experienced the typical benefit from this seasonality in Q4 of 2024, which endured each month throughout the year.
Speaker Change: The glass factor.
Speaker Change: I would like to call out as it pertains to our Q4 revenue performance of seasonality the fourth quarter tends to be the strongest in our industry as deductibles and out of pocket maximums or met such that a pump purchase is no longer constrained by out of pocket costs.
Speaker Change: We experienced the typical benefit from the seasonality in Q4 of 2024, which endured each month throughout the quarter.
Stephen Feider: Turning to our Gross Margin Profile. Gross margin in the 4th quarter was 57.2% compared to 60.6% in the 4th quarter of 2023 and growing sequentially versus 53.4% in the 3rd quarter of 2024. Our gross margin for the full year 2024 was 55.1% compared to 52.6% in the prior year, reflecting our continued cost discipline and better leverage of our manufacturing overhead as we continue to grow. Total operating expenses in the fourth quarter were $24.7 million, an increase of 84% compared to the $13.4 million in the fourth quarter of 2023. The increase in operating expenses was primarily attributable to the expansion of our commercial sales efforts and a one-time milestone payment of $3 million made under the License and Collaboration Agreement with Xeris for their successful completion and delivery of a pump-compatible formulation of glucose.
Speaker Change: Turning to our gross margin profile.
Speaker Change: Gross margin in the fourth quarter was 57, 2% compared to 66% in the fourth quarter of 2023 and growing sequentially versus 53, 4% in the third quarter of 2024.
Speaker Change: Our gross margin for the full year 2024 was 55, 1% compared to 52, 6% in the prior year, reflecting our continued cost discipline and better leverage of our manufacturing overhead as we continue to scale.
Speaker Change: Total operating expenses in the fourth quarter were $24 7 million, an increase of 84% compared to the $13 4 million in the fourth quarter of 2023.
Speaker Change: The increase in operating expenses was primarily attributable to the expansion of our commercial sales efforts and a onetime milestone payment of $3 million made under the license and collaboration agreement with <unk> for their successful completion and delivery of a pump compatible formulation of glucagon.
Stephen Feider: Shifting to our cash, as of December 31, 2024, we ended the year with $103.6 million in cash and cash equivalents in short-term investments. As Sean mentioned earlier, we recently completed our initial public offering and concurrent private placement at the end of January, which raised approximately $206 million in net proceeds, strengthening our cash position for 2025 and beyond. We expect to spend approximately $50 million of these proceeds on our patch pump program and another approximately $50 million on our bi-hormonal program, with the rest of our cash serving to strengthen our financial position and give us flexibility to invest in our business and drive long-term, sustainable growth.
Speaker Change: Shifting to our cash as of December 31, 2024, we ended the year with $103 $6 million in cash and cash equivalents and short term investments.
Speaker Change: As Shawn mentioned earlier, we recently completed our initial public offering and concurrent private placement at the end of January which raised approximately $206 million in net proceeds strengthening our cash position for 2025 and beyond.
Speaker Change: We expect to spend approximately $50 million of these proceeds on our patch pump program and another approximately $50 million on.
Speaker Change: On a by hormonal program with the rest of our cash serving to strengthen our financial position and give us flexibility to invest in our business and drive long term sustainable growth.
Stephen Feider: Now turning to our 2025 outlook, we expect another year of robust demand for the island. We project that total company revenue for the full year of 2025 will be 80 to 85 million dollars, driven by strong adoption by new users, as well as recurring revenue from existing users. As discussed prior, there were a number of tailwinds that we saw in the fourth quarter of 2024 that we expect to persist into and through 2025, including the launch of our Color Islet, Abbott's Freestyle Libre 3 Plus CGM integration, and the Bionics Circle app. We also discussed the importance of the pharmacy channel mix increases in driving adoption.
Speaker Change: Now turning to our 2025 outlook, we expect another year of robust demand for the island.
Speaker Change: We project that total company revenue for the full year of 2025 will be $80 million to $85 million driven by strong adoption by new users as well as recurring revenue from existing users.
Speaker Change: As discussed prior there were a number of tailwind that we saw in the fourth quarter of 2024 that we expect to persist into and through 2025, including the launch of our color islet Abbott freestyle Libre, III, plus CGM integration and the Bionic Circle App.
Speaker Change: We also discussed the importance of the pharmacy channel mix increases in driving adoption.
Stephen Feider: and we expect greater than 20% of our new patient starts to be reimbursed through the pharmacy channel in 2025, up from a high single-digit percentage in 2024 overall and a low teens percentage in Q4 2024 specifically. A large driver of this expected increase in pharmacy mix relative to last year and the previous quarter is the formulary agreement we signed with Prime Therapeutics that we announced in our earnings press release. Disagreement with Prime Therapeutics National Commercial Formulary expands Islet's formulary coverage as of February 1st of this year. We would remind you that while formulary agreements are critical for driving pharmacy coverage, the next step to activating that coverage is working with the health plans that partner with Prime Therapeutics as their pharmacy benefit manager to ensure that their members are able to access ILLIT through the pharmacy For more information visit www.FEMA.gov Prime has recommended to its health plans that they adopt Islet for coverage under their pharmacy benefit, and we are actively working with the health plans to drive that adoption.
Speaker Change: And we expect greater than 20% of our new patient starts to be reimbursed through the pharmacy channel in 2025 up from a high single digit percentage in 2024 overall and a low teens percentage in Q4 2024, specifically.
Speaker Change: Largest driver of this expected increase in pharmacy mix relative to last year and the previous quarter is the formulary agreement, we signed with Prime Therapeutics that we announced in our in our earnings press release.
Speaker Change: This agreement with Prime Therapeutics National commercial formulary expands eyelets formulary coverage as of February one of this year, we would remind you that while formulary agreements are critical for driving pharmacy coverage. The next step to activating that coverage is working with the health plans that partner with Prime therapeutics as their pharmacy benefit manager to ensure that their members are able to access <unk> through the farmers.
Speaker Change: <unk> benefit.
Speaker Change: Prime is recommended to its health plans that they adopt island for coverage under their pharmacy benefit and we are actively working with the health plans to drive that adoption.
Stephen Feider: While this anticipated increase in pharmacy mix for 2025 is expected to act as a headwind to our 2025 revenue, our guidance contemplates this impact. And we want to remind you that this headwind for these new pharmacy users flips into tailwind relative to DME after 11 months.
Speaker Change: While this anticipated increase in pharmacy mix for 2025 is expected to act as a headwind to our 2025 revenue our guidance contemplates this impact and we want to remind you that this headwind for these new new pharmacy users flips into tailwind relative to <unk> after 11 months.
Stephen Feider: We expect to have also expanded our field sales force to 63 territories exiting Q1 2025, which compares to 43 territories exiting Q4 of 2025. In terms of how to think about the revenue cadence throughout the year, we expect the relative weighting of new patient starts and revenue across each quarter to be similar to the relative weighting we saw across each quarter in 2024. We anticipate new patient starts in the first quarter will decline sequentially relative to the fourth quarter of the prior year, new normal seasonal trends, although we expect to be able to offset that seasonality to some degree as the recent product launches I mentioned continue to gain traction.
Speaker Change: We expect to have also expanded our field sales force to 63 territories exiting Q1, 2025, which compares to 43 territories exiting Q4 of 2024.
Speaker Change: In terms of how to think about the revenue cadence throughout the year, we expect the relative weighting of new patient starts and revenue across each quarter to be similar to the relative weighting we saw across each quarter. In 2024, we anticipate new patient starts in the first quarter will decline sequentially relative to the fourth quarter of the prior year due to normal seasonal trends, although we expect to be able.
Speaker Change: To offset that seasonality to some degree as the recent product launches I mentioned continued to gain traction.
Stephen Feider: In 2025, we anticipate observing the pharmacy mix of new patient starts increase at a faster rate in the first half of the year compared to the second half given the formulary agreement with Prime Therapeutics went into effect on February 1st, and we are working with the health plans to drive coverage of the islet in the pharmacy. While these efforts to expand pharmacy adoption will continue throughout the year, we anticipate a larger impact from them in the first half of 2025 relative to the second half of 2020. So in addition to the typical seasonality where our industry tends to see revenue decline in the first quarter relative to the fourth quarter of the prior year, the sequential increases in pharmacy mix that we expect to see in Q1 will also weigh on revenue.
Speaker Change: In 2025, we anticipate observing the pharmacy makes a new patient starts increased at a faster rate than the first half of the year compared to the second half given the formulary agreement with Prime Therapeutics went into effect on February one and we are working with the health plans to drive coverage of the island and the pharmacy.
Speaker Change: While these efforts to expand pharmacy adoption will continue throughout the year, we anticipate those larger impact from them in the first half of 2025 relative to the second half.
Speaker Change: So in addition to the typical seasonality, where our industry tends to see revenue decline in the first quarter relative to the fourth quarter of the prior year.
Speaker Change: Sequential increases in pharmacy mix that we expect to see in Q1 will also weigh on revenue but.
Stephen Feider: We believe that our recent product launches and our increasing pharmacy mix will drive strength in our new patient starts that will enable us to partially offset those headwinds I discussed.
Speaker Change: We believe that our recent product launches and our increasing pharmacy mix will drive strengthen our new patient starts that will enable us to partially offset those headwinds I discussed for Q1.
Stephen Feider: So to summarize, we expect a similar weighting of revenue across quarters in 2025 as we saw in 2024. Q1 revenue will step down sequentially versus Q4 of 2024 due to seasonality and increasing pharmacy adoption, but there are some offsets to that seasonality that we expect. We expect pharmacy adoption to decelerate in the back half of 2025 relative to the front half, and that combined with our new territories continuing to mature and seasonality being favorable in Q4, will result in heavier weighting of revenue towards the back half of the year than the front half of the year.
Speaker Change: So to summarize we expect a similar weighting of revenue across quarters in 2025, as we saw in 2024.
Speaker Change: <unk> revenue will step down sequentially versus Q4 of 2024 due to seasonality and increasing pharmacy adoption, but there are some offsets to that seasonality that we expect to see we expect pharmacy adoption to decelerate in the back half of 2025 relative to the front half and that combined with our new territories, continuing to mature and seasonality being favorable in Q4.
Speaker Change: Four will result in heavier weighting of revenue towards the back half of the year than the front half of this of the year.
Stephen Feider: Again, these factors are all contemplated in our annual guidance, but the details I'm sharing are meant to give you all a sense of what to expect with regards to our revenue trajectory as we move through the year.
Speaker Change: Again. These factors are all contemplated in our annual guidance, but the details I'm sharing are meant to give you a sense of what to expect with regards to our revenue trajectory as we move through the year.
Stephen Feider: Shifting your gross margin. We expect to see at least 50% gross margin for the full year 2025, which at the low end represents a decline relative to the prior year driven by the by the expected increase in pharmacy new patient starts as a percentage of our total new patient. We expect gross margin to increase slightly throughout the year as the increasing pharmacy adoption as a percentage of new patients starts weighs on gross margin, while increasing manufacturing volumes and growing pharmacy install base improve gross margin. Our actual gross margins may differ materially from these projections in any given quarter, or for the year overall, if pharmacy new patient starts as a percentage of total new patient starts deviates considerably from our guidelines.
Speaker Change: Shifting to gross margin.
Speaker Change: We expect to see at least 50% gross margin for the full year 2025, which at the low end represents a decline relative to the prior year driven by the by the expected increase in pharmacy, new patient starts as a percentage of our total new patient starts.
Speaker Change: We expect gross margin increased slightly throughout the year as the increasing pharmacy adoption as a percentage of new patient starts weighs on gross margin, while increasing manufacturing volumes and growing pharmacy installed base improved gross margin.
Speaker Change: Our actual gross margins may differ materially from these projections in any given quarter or for the year overall, if pharmacy, new patient starts as a percentage of total new patient starts deviates considerably from our guidance.
Stephen Feider: Despite the margin compression we expect to see in 2025 relative to 2024, we view this trajectory as a positive for our business in the long run because the expected increase in pharmacy mix bodes well for our gross margin outlook beyond 2024.
Speaker Change: Despite the margin compression, we expect to see in 2025 relative to 2024, we view this trajectory as a positive for our business and the long term and the long run because the expected increase in pharmacy mix bodes well for our gross margin outlook beyond 2025.
Stephen Feider: I'd also like to briefly note that as it pertains to the tariffs recently enacted by the Trump administration, we believe our overall exposure is currently de minimis and anticipate that it will remain true. While we do source some components for the islet and its associated supplies internationally, the vast majority of these are custom components and as such they are exempt from international tariffs under the Nairobi Protocol. There are a limited number of off-the-shelf components that we source internationally that are not exempt, but to reiterate, we believe the impact of tariff increases on our overall cost of goods is currently de minimis, and we expect that will remain the case.
Speaker Change: I'd also like to briefly note that as it pertains to the tariffs recently enacted by the Trump administration. We believe our overall exposure is currently de Minimis and anticipate that will remain true.
Speaker Change: While we do source some components for the island and its associated supplies internationally. The vast majority of these are custom components and as such they are exempt from international tariffs under the Neuroma protocol.
Speaker Change: There are a limited number of off the shelf components that we source internationally that are not exempt but to reiterate we believe the impact of tariff increases on our overall cost of goods is currently de Minimis and we expect that will remain the case.
Stephen Feider: If the Trump administration chooses to eliminate the Nairobi protocol, which we have no reason to support. We expect the impact of a tariff increase on our overall cost of goods would be nominal, but this is a dynamic that we will continue to monitor.
Speaker Change: If the Trump Trump administration chooses to eliminate the <unk> protocol, which we have no reason to suspect we expect the impact of a tariff increase on our overall cost of goods would be nominal but this is a dynamic that we will continue to monitor.
Stephen Feider: In summary, we are pleased with our performance in the fourth quarter and the full year 2024. We are also confident in our 2025 guidance and particularly excited about our forecasted growth in pharmacy adoption. Following our IPO, we are in a strong position to invest in the business and advance critical innovations that have the ability to transform diabetes care as we know it.
Speaker Change: In summary, we are pleased with our performance in the fourth quarter and full year 2024. We're also confident in our 2025 guidance and particularly excited about our forecasted growth in pharmacy adoption.
Speaker Change: Following our IPO, we are in a strong position to invest in the business and advance critical innovations that have the ability to transform diabetes care as we know it.
Sean Saint: With that, I'll hand the call back to Sean for some closing remarks. Thanks, Steven, and thank you all for your time today. We appreciate your continued support and interest in Beta Bionics as we work to simplify and alleviate the burden of managing diabetes with life-changing solutions. I hope that what you all take away from this is that we have a number of compelling short, medium and long-term initiatives that we expect will ultimately deliver better outcomes to a much larger group of people living with diabetes. Along with that, we believe we are building a durably robust business.
Sean: With that I'll hand, the call back to Sean for some closing remarks.
Sean: Thanks, Steven and thank you all for your time today. We appreciate your continued support and interest in beta bionics as we worked to simplify and alleviate the burden of managing diabetes with life changing solutions I hope that what you all take away from this is that we have.
Sean: A number of compelling short medium and long term initiatives that we expect will ultimately deliver better outcomes to a much larger group of people living with diabetes, along with that we believe we are building a durably robust business. While our journey has just begun we have conviction that we have made and will continue to make the right investments that will pay off.
Sean Saint: While our journey has just begun, we have conviction that we have made and will continue to make the right investments that will pay off in the long run. Specifically, we appreciate your willingness to dig in and understand what amounts to a new business model with the Pharmacy Channel that in the long run will prove to be a benefit for beta bionics and most importantly people living with diabetes.
Sean: In the long run specifically, we appreciate your willingness to dig in and understand what amounts to a new business model with the pharmacy channel that in the long run will prove to be a benefit for beta bionics and most importantly people living with diabetes with that operator, please open the call for Q&A.
Operator: With that, Operator, please open the call for Q&A. As a reminder, to ask a question, you will need to press star 11 on your telephone. To remove yourself from the queue, you may press star 11 again. We ask that you limit yourself to one question and one follow-up to allow everyone the opportunity to participate.
Sean: As a reminder to ask a question you will need to press star one on your telephone.
Sean: <unk> yourself from the queue Press Star one again, we ask that you limit yourself to one question and one follow up to allow everyone the opportunity to participate.
Travis Steed: Our first question. comes from Travis Steed of Bank of America. Please go ahead, Travis. Hey everybody, congrats on your first earnings call. It was a very thorough call, so thanks for that. I guess to start out, one on the guidance is kind of thinking about the visibility of the pharmacy percentages that you've got. There's a lot of assumptions you made in the guidance on the pharmacy mix, so just curious about visibility there. And on the Q1, I think the math we were doing was $16.5 million. Just wanted to kind of confirm if we were doing the math right for Q1 revenue.
Sean: Our first question.
Comes from Travis Steed Bank of America. Please go ahead Travis.
Sean: Hey, everybody congrats on your first earnings call.
Speaker Change: Very thorough call. So thanks for that I guess I'll start out.
One on the guidance just kind of thinking about the visibility of the pharmacy percentage it because your guide.
Speaker Change: What are the assumptions you've made in the guidance on the pharmacy mix. So just curious on the visibility there and on Q1 I think the math you were doing was $16 $5 million just wanted to kind of environment. We were doing the math right for Q1 revenue.
Sean Saint: And then the second question would be more around kind of the commercial team, and as you've kind of rolled that out over the course of the last few months and getting a little more traction, one of your competitors has talked about. slowdown on the market end of last year and just curious kind of what you're seeing in the market Yeah. Well, thanks, Travis. Yeah, and great question.
Speaker Change: And the second question would be.
Speaker Change: More around kind of the commercial.
Speaker Change: Team and as you kind of roll that out over the course of the last few months and getting a little more traction one of your competitors has talked about.
Speaker Change: The slowdown in the market end of last year, and just curious kind of what youre seeing in the market with the commercial team.
Speaker Change: Yes, well thanks Travis.
Stephen Feider: So I think we got all those down, but we may have to ask you to restate some of that. So, and yeah, this is Steven. So regarding the guidance on the invisibility of the pharmacy mix. So I think importantly, you know, we have seen this agreement that we just signed with Prime Therapeutics, the largest national formulary. And, you know, so that's in place and we expect to see some impact from that in the near future. But then the second thing I'll state is that, look, we, you know, just due to the timing of when we did our IPO and that, you know, why this, this fourth quarter earnings call is happening here towards, you know, three months into the year, we're seeing, you know, some of the pharmacy impact already through the first three months.
Speaker Change: Yeah, Great question. So I think we got all those down we may have to ask you to restate some of that.
Stephen: And yes. This is Stephen so.
Stephen: The guidance on the in the visibility of the pharmacy mix. So I think importantly, we have seen this agreement that we just signed with prime therapeutics largest national formulary and.
Stephen: And so thats in place and we expect to see some impact from that.
Stephen: The near future, but then the second thing I'll state is that.
Stephen: Just due to the timing of when we did our IPO.
Stephen: This fourth quarter earnings call is happening here towards three months into the year.
We're seeing some of the pharmacy impact already through the first three months, so I'm not going to give you a prediction on exactly what we're expecting to see in the first quarter, but we have had the benefit of course of now almost three full months of <unk>.
Stephen Feider: So I'm not going to give you a prediction on exactly what we're expecting to see in the first quarter, but we have had the benefit, of course, of now, you know, of commercial results to see the traction that we're feeling in pharmacy in 2025. So feeling pretty good about our visibility there for those.
Stephen: Our commercial results to see the traction that we're feeling in pharmacy in 2025, so feeling pretty good about our visibility there for those reasons.
Stephen Feider: I have a question regarding the revenue number that you stated. So look, I'm not going to call a particular number on the first quarter. I don't think we gave any guidance on this call that stated exactly, you know, what you should expect. We gave kind of directionally that the weighting of revenue for 2025 would be consistent generally with 2024. So, you know, I hear your math, but, you know, I won't kind of confirm your number specifically.
Stephen: Regarding the revenue number that you stated so look I'm not going to call. A particular number on the first on the first quarter I don't think we gave any any guidance on this on this call that stated exactly what you should expect we gave kind of directionally that the weighting of revenue for 2025 would be consistent generally with 2024, so I.
Sean: I hear your math, but I won't kind of confirm from your number specifically and then maybe on the last point, Sean do you want to do you want to take just a.
Sean Saint: And then maybe on the last point, Sean, do you want to take a comment on this? Generically, I would just say that, first of all, thanks, Travis, for the question. I really appreciate it. First one for us. Thank you. Anyway, you know, we have more limited experience than some of the other companies in terms of seasonality, but I will say that we, from our perspective, did not see a slowdown near the end of the year. So no real comment beyond that.
Stephen: Comment on just generically I would just say that.
Stephen: First of all thanks, Charles for the question I really appreciate it first one for us Thank you anyway.
Stephen: We have more limited experience than some of the other companies in terms of seasonality, but I will say that we from our perspective did not see a slowdown near the end of the year. So no real comment on that great. Thank you and I've been here a bunch of the patch pump on this call some of that was intentional, but im curious if theres been any.
Sean Saint: Thank you.
Sean Saint: And I didn't hear much about the patch pump on this call, I assume that was intentional, but I'm curious if there was anything to say on the patch pump and update on that. Not really beyond what we had to say, you know reiterating we expect to commercialize by the end of 27 and we like our form factor Great. Thanks a lot. Thank you. Thanks, Travis. Thank you.
Stephen: Anything you can say on the patch pump.
Stephen: Update on that front.
Stephen: Not really beyond what we had to say.
Stephen: Reiterating we expect to commercialize by the end of 'twenty seven.
Stephen: And we like our form factor.
Speaker Change: Okay, great. Thanks, a lot.
Travis: Thank you thanks Travis.
Matthew O'brien: Next question. comes from Matthew O'Brien of Piper Sandler. Please go ahead, Matthew. Afternoon. Can you guys hear me okay? Yeah, we can hear you loud and clear, Matt. How's it going? Fantastic. It's great.
Speaker Change: Thank you our next question.
Speaker Change: Come from Matthew O'brien of Piper Sandler. Please go ahead Matthew.
Matthew O'brien: Good afternoon can you guys hear me okay.
Speaker Change: Yes, loud and clear, Matt How's it going fantastic.
Matthew O'brien: Thanks for the questions and congrats on getting public. Maybe just to follow up on Travis's question a little bit on patch. I had thought that, you know, we should be expecting that approval kind of middle of 27 with some revenue contribution in 27. Is that not the case anymore? And are you just trying to be a little bit conservative with that timing there? Is that, you know, just any finer points you can provide on that would be helpful. and then I go to a follow-up. Okay, gotcha. Yeah, Matt, first of all, thanks very much. I appreciate your question as well, and thanks to the Congress for going public.
Matthew O'brien: Great.
Matthew O'brien: Thanks for the questions and congrats on getting public maybe just a follow up on <unk> question, a little bit on patch.
Matthew O'brien: Got that.
Matthew O'brien: We should be expecting that approval kind of middle of 2007 with some revenue contribution in 2007.
Speaker Change: Is that not the case anymore and are you just trying to be a little bit conservative with that timing. There is that just any finer point you can provide on that would be helpful. Thanks, and then I do have a follow up.
Matthew O'brien: Okay Gotcha.
Matthew O'brien: First of all thanks, very much I appreciate your question as well and thanks for the congrats going public.
Sean Saint: You know, our timeline on patches never evolved. We've been very consistent in our messaging here, and I don't believe it's changed in any way. So, you didn't hear a signal of any description, except that we intend to commercialize by the end of 27. And when we say by commercialize, it's, you know, starting to actually sell it. So, you're right that, you know, generating revenue by the end of 27 is exactly what we mean by commercializing. Great point, Stephen. We haven't guided toward clearance in any way. No. Got it. Okay, appreciate that.
Matthew O'brien: Our timeline on patches never evolves, we've been very consistent in our messaging here and I don't believe its changed in any way. So you didn't hear a signal of any description except that we intend to commercialize by the end of 'twenty seven.
Matthew O'brien: When we say by commercialize is starting to actually sell it so youre right.
Matthew O'brien: <unk> revenue by the end of 2007 is exactly what we mean by commercializing a great point, Stephen we haven't guided towards clearance in anyway no.
Matthew O'brien: Got it okay appreciate that and then.
Sean Saint: And then, you know, one of your durable competitors is introducing a new algorithm that's supposed to make it easier for patients to start on their pumps. You know, I'm not sure if you've seen that. At this point, I think it was just released. Something that comes up all the time is just your ability to stay ahead in terms of ease of use. Is that an area that could be at risk somewhat for islet versus the competitors that are out there? Or, you know, are you comfortable that the form factor and the algos specifically will stay ahead in terms of ease of use?
Speaker Change: One of your competitors.
Speaker Change: Is introducing a new algorithm thats supposed to make it easier for patients to start on their pumps I'm not sure if you've seen that at this point I think it was just released.
Speaker Change: Something that comes up all the time, it's just your ability to stay ahead in terms of ease of use is that an area that could get risk somewhat for Ireland versus the competitors that are out there or.
Speaker Change: Are you comfortable that the form factor of the Algo, specifically will stay ahead in terms of ease of use.
Sean Saint: Thanks. Yeah, thanks for that one, Matt. You know, we're pretty familiar with that, sure. And, you know, look, I'll be respectful of the fact that what they've done is they've sort of made it automatic to enter the ACE guidelines into the pump. So it removes a few steps. And that's nice, but it's very different. And I want to be clear on the differentiation from what we are doing. Our product starts up based on weight, and then learns and adapts to you. So the question I would suggest is how often are users set up with the ACE guidelines and then left with those guidelines and never modified.
Matt: Yes, thanks for that one Matt.
Speaker Change: We're pretty familiar with that sure and.
Matt: Look I'll be respectful of the fact that what they've done is they.
Matt: <unk>.
Matt: Sort of made it automatic to enter the <unk> guidelines into the pump. So it removes a few steps and that's nice but it is very different and I want to be kind of differentiation from what we are doing our product starts up based on weight and then learns and adapts to you. So the question I would suggest is how often are users set up with the <unk>.
Matt: And then left with those guidelines never modified our product the learning and the adaptation is the tough part about what we do the real time controllers are comparatively simple.
Sean Saint: Our product, the learning and the adaptation is the tough part about what we do. The real-time controllers are comparatively simple. We heard some noise lately that, you know, nobody's learning these days. Well, that's not true, because we are 100%, as evidenced by the fact that we are solely starting up based on your weight. So yeah, we see a pretty big chasm between the ease of use aspects of what we're up to and those of our, the particular competitor you're referring to. Let me reiterate. Actually, let me additionally state, Matt, that I think that the industry, as a general sense, has been stating that they really are moving toward ease of use, right?
Matt: We heard some noise lately that nobody's learning these days well that's not true because we are 100% as evidenced by the fact that we are solely starting up based on your weight.
Matt: Yes, we see a pretty big chasm between the ease of use aspects of what we're up to and those of are the particular competitor you're referring to.
Matt: Okay.
Matt: Let me reiterate I'll actually let me Additionally state map.
Matt: I think that the industry as a general sense has been stating that they really are moving towards ease of use right. We launched and everybody all of a sudden start talking about small medium and large they started talking about simplify they started trying to leapfrog to fully closed loop.
Sean Saint: We launched, and everybody all of a sudden started talking about small, medium, and large. They started talking about simplified. They started trying to leapfrog the fully closed loop. We get that. There was a reason we took the opportunity to present our fully closed loop mode data today, which we put up against anything in development today, and I think we can do the research on that. Thank you.
Matt: We get that there was a reason we took the opportunity to present, our fully closed loop mode data today, which we put up against anything in development today and I think we can do the research on that so thank you.
Mike Kratky: Our next question comes from Mike Kratky of BlueRink Partners. Please go ahead, Mike. Hi everyone. Thanks for taking our questions and congrats on all the recent progress. So first, I'd just like to circle back on the comments on the expected cadence of pharmacy is a percent of new starts throughout 2025 that gets you to that over 20% guidance for the full year. Do you expect that that will increase sequentially every quarter throughout the year? And in that case, is it fair to assume that you could actually be exiting 4 to 25 well over 20% and I have a follow up.
Matt: Thank you our next question.
Speaker Change: From my Kratky Blue rink partners. Please go ahead Mike.
Speaker Change: Hi, everyone. Thanks for taking our questions and congrats on all the recent progress.
Speaker Change: Yeah.
Speaker Change: So first I'd just like to circle back on the comments on the expected cadence of pharmacy as a percent of lease starts throughout 2025 gets you to that over 20% guidance for the full year.
Speaker Change: Can you expect that that will increase sequentially every quarter throughout the year and in that case is it fair to assume that you could actually be exiting <unk> hundred 25, well over 20% and I have a follow up.
Stephen Feider: Yeah, look, so we are expecting there to be some steady increase to the pharmacy new patient starts as a percentage of total new patient starts throughout the year. So absolutely. I was just calling, you know, the increase that we're going to see relative to 2024 as more stark in the first half of 2025 relative to the uptick that we're forecasting in the second half of 2025. So that's the first one. And what was your second question, Mike? Increase... Yeah, look, I guess by very virtue of us just of us saying that we will see, you know, we expect to see over 20% pharmacy new patient starts as a percentage of total new patient starts by by virtue of us saying that that's going to be above 20%.
Speaker Change: Okay.
Speaker Change: Yes look so we are expecting there to be some steady increase to the pharmacy, new patient starts as a percent.
Speaker Change: <unk> of total new patient starts throughout the year so absolutely.
Speaker Change: I was just calling that.
Speaker Change: The increase that we're going to see relative to 2024 as more stark in the first half of 2025 relative to the uptick that we're forecasting in the second half of 2025.
Speaker Change: So that's that's the first one.
Speaker Change: And what was your second question, Mike increase could.
Speaker Change: Could we expect to see it.
Speaker Change: Yeah look I guess by very virtue of us just saying that we will see we expect to see over 20%.
Speaker Change: Pharmacy, new patient starts as a percentage of total new patient starts by virtue of us, saying that thats going to be above 20%. It could certainly be higher later later in the year, but I don't want to call an exact number that we expect to exit two.
Stephen Feider: You know, it could certainly be higher later later in the year, but I don't want to call like, you know, an exact number that we expect to exit 2025 or Q4 2025. Got it. Yeah, totally understood.
Speaker Change: 2025, Q4 2025 with.
Matthew O'brien: Got it yes totally understood and then in terms of your type two off label use to what extent have you started to see some early use within the primary care setting versus this predominantly being from endo offices.
Sean Saint: And then in terms of your type 2 off-label use, to what extent have you started to see some early use within the primary care setting versus this predominantly being from endo offices? Hey, Mike. This is Sean. First of all, thanks for your question. Appreciate it. You know, it's tough to call that one exactly, and I'm not gonna give percentages on it. What I will say is, you know, at some level, we're certainly calling on high-prescribing primary care providers today. Additionally, you know, the word is getting out sort of somewhat organically. So it's happening, no question about that.
Matthew O'brien: Hey, Mike This is Sean first of all thanks for your question I appreciate it.
Matthew O'brien: It's tough to call that one exactly and I'm not going to give percentages on it what I will say as you know at some level, we're certainly calling on a high prescribing primary care providers. Today. Additionally, the word is getting out sorry somewhat organically. So it's happening no question about that but.
Sean Saint: But I don't think we wanna give a percentage or a rate that's happening in primary there. I think we all do know that the lion's share of type twos are managed by primary care providers. So that's gonna be a much more important channel to be able to access in order to meaningfully impact the type two market. You know, one of the things I said in the calls that we do think it's important for the product to be applicable on a certain market. And I think that in the primary care market, the things that make the product applicable are things like the ease of setup, and more importantly, learning and adaptation for a particular user.
Matthew O'brien: But I don't think we want to give a percentage or a rate that's happening in primary there I think we all do know that the lion's share of type twos are managed by primary care providers. So that's going to be a much more important channel to be able to access in order to meaningfully impact the.
Matthew O'brien: The type two market.
Matthew O'brien: One of the things I said in the calls that we do think it's important for the product to be applicable in a certain market and.
Matthew O'brien: I think that in the primary care market, the things that make the product optical where things like the <unk>.
Matthew O'brien: These are set up and more importantly, learning and adaptation for a particular user but look as we all know where we do not have a type two indication today, we are not.
Sean Saint: But look, as we all know, we do not have a type two indication today. We are not advertising in any way for type two. What we have seen is purely organic and we're pretty surprised by the number, I suppose. Thanks, Mike.
Matthew O'brien: Advertising in any way for type two what we have seen is purely organic and.
Matthew O'brien: We're pretty surprised by the number of votes.
Stephen Feider: Yeah, I guess maybe just a bit more on that. Clearly from the metric that we stated in this call, and from what Sean just explained, our product is highly applicable for people with type 2 diabetes, even though there's no indication. But I think the other thing that we have going for us as a durable pump company, relative to maybe what we're seeing with other durable pump companies, is that it makes it a lot easier for the doctor to prescribe, for a primary care doctor to prescribe, or for any HCP, I should say, to prescribe the islet with pharmacy coverage.
Mike: Thanks, Mike.
Matthew O'brien: I guess, maybe just a bit more on that I look.
Mike: Clearly from the metric that we stated in this call.
Mike: Sean just explained our product is highly applicable for people with type two diabetes, even though there is no indication, but I think the other thing that we have going for us is a durable pump company rare.
Mike: Relative to maybe what we're seeing in other with other durable pump companies is that it makes it a lot easier for the doctor to prescribe.
Mike: For a primary care doctor to prescribe.
Mike: But for any any HCP I should say to prescribe the island.
Stephen Feider: So that eliminates the need for a negative C-peptide lab, and it also is just an easier prescribing process. And the actual filling out a statement of medical necessity form that's traditional with DME pumps and get the associated reimbursement, that's no longer required with pharmacies. So it's a much easier process, and an HCP doesn't have to be as familiar with managing a pump and with the whole prescription process. So because we have that characteristic to our business, where we're seeing a real amount of our patients go through pharmacy, that's helping our type 2 adoption. Understood. Thank you very much.
Mike: Pharmacy coverage so that.
Mike: Has it eliminates the need for a negative C peptide lab and it also is just an easier prescribing processing the actual like filling out a statement a medical necessity form that's traditional with with dnb pumps and get the associated reimbursement that's no longer required with pharmacy. So it's it's a much easier process than any in <unk>.
Mike: He doesn't have to be as familiar with with with managing a pump and with the whole prescription process. So because we have that characteristic to our business, where we're seeing a real amount of our patients go through pharmacy, that's helping our type two adoption as well.
Mike: Understood Thanks very much.
Matthew Blackman: Thank you. Our next question comes from Matthew Blackman of Stiefel. Please go ahead, Matthew. Good afternoon, everybody. Appreciate you taking my questions.
Mike: Thank you.
Our next question comes from Matthew Blackman of Stifel. Please go ahead Matthew.
Mike: Hi, Good afternoon, everybody I appreciate you taking my questions.
Sean Saint: Maybe to start, Sean or Stephen, this is a bigger picture question. Just curious if you could provide us some sense, even if just qualitative, where you're seeing commercial success. Are there any common threads on the patients adopting who they are, where they are, or anything about the physicians writing the scripts, again, along the lines of that primary care comment? Just curious, you know, how you're seeing the business execute across multiple channels and different patient populations, and then I've got a follow-up. All right.
Speaker Change: Just start Sean or Stephen.
Mike: Bigger picture question Curie.
Mike: Curious if you could provide us some sense, even if just qualitative where youre seeing commercial success are there any common threads on the patients adopting who they are where they are or anything about the physicians writing scripts again, along the lines of that primary care kind of just curious how you're seeing the business execute across multiple channels.
Speaker Change: Different patient populations, and then I've got a follow up.
Sean Saint: Hey Matt, this is Sean. Thanks very much for your question. Appreciate it. Let me give a little bit of color here. You know, what we said in the prepared remarks is that our cross-section of users looks very much like the population with type 1 diabetes in this country, and we try very hard to be, you know, our goal is to impact population health, right, which means you at some level have to be for most people. And I think that's central to where we're finding success, right? We're very much designed to be successful with endos, yes.
Speaker Change: Alright, Hey, Matt This is Sean thanks, very much for your question appreciate it.
Speaker Change: Let me give a little bit of color here.
Speaker Change: What we said in the prepared remarks is that our our cross section of users looks very much like the population with type one diabetes in this country.
Speaker Change: And we try very hard to be.
Speaker Change: Our goal is to impact population health right, which means you're at some level have to be for most people and I think that's central to where we're finding success rate. We're very much designed to be successful within those yes, we're still aligned to be successful successful the primaries, yes people with high wind speeds, yes people low.
Sean Saint: We're designed to be successful with primaries, yes. People with high A1Cs, yes. People with low A1Cs, yes. Everywhere in between. And that's what our patient population looks like. So it's a little bit hard to say specifically where because we're not really being niched very well right now. We're in fact being used more evenly and broadly across the population as we would hope. So I hope that's a good answer. But yeah, no real niche that we're seeing. Yeah, well, I mean, it sounds like successful across multiple channels, multiple patients. So that's that's a good answer.
Speaker Change: Hey, when Ccs everywhere in between and that's what our patient population looks like so.
Speaker Change: It's a little bit hard to say, specifically, where because we're not really being niche very well right. Now we are in fact being used more evenly and broadly across the population.
Speaker Change: As we would hope so.
Speaker Change: I hope that's a good answer but yes.
Speaker Change: Yes, there's no real niche that we're seeing.
Speaker Change: Well I mean, it sounded like successful across multiple channels multiple patients. So that's a good answer.
Stephen Feider: And maybe, Stephen, and look, I appreciate this is my math, but if I try to break down the twenty twenty five revenue guide, it seems like just, again, running some numbers, it assumes something in the neighborhood of what's called roughly 100 basis points of share gains. So the first part is, is that sort of roughly in the ballpark? And just for context, and I get it, it's still early days of the rollout. But I think in twenty twenty four, if our math, if our math is right, you need at least several hundred basis points of share.
Speaker Change: Maybe Steven and look I. Appreciate this is my math, but if I try to break down the 2025 revenue guide it seems like just again running some numbers it assume something in the neighborhood of lets call. It roughly 100 basis points of share gains. So the first part is is that sort of roughly in the ballpark and just for context.
Speaker Change: It's still early days of the rollout, but I think in 2024, if our if our math is right you gained at least several hundred basis points of share just am I thinking about all those moving parts correctly Steven.
Stephen Feider: Just am I thinking about all those moving parts correctly, Stephen? I'm not prepared to talk about specifics regarding share gain, so the actual number of installed base that all of our competition has and what we expect from 2025 in terms of new patient starts coming from MDI, going to pump site, it's not something that we're prepared or at this time commenting on. So sorry Matt, I won't be able to answer that one. Good question, but I don't want to confirm your math. Appreciate it. Thanks, guys.
Speaker Change: Okay, I am actually not I'm not prepared to talk about specifics regarding share gain so.
Speaker Change: The actual number of new <unk>.
Speaker Change: Installed base at all of our competition has and what we expect from 2025 in terms of new patient starts coming from MDI.
Speaker Change: Going to pump site.
Speaker Change: It's not something that we're that we're prepared or are at this time, commenting on so sorry, Matt I won't be able to answer that one good question, but I don't want to confirm your math.
I appreciate it thanks guys.
Operator: Thank you.
Speaker Change: Thank you.
Brooks O'Neill: Our next question comes from Brooks O'Neill of Lake Street Capital Markets. Please go ahead, Brooks. Thank you. Good afternoon, guys. And welcome to the public markets. It's nice to be interacting with you in this venue. So I have a couple of questions. Obviously, a lot lot of questions have been asked and answered. But you guys called out that you're the first pump to integrate with Abbott Libre three plus. I'm curious if you're seeing anything you would call noteworthy about that integration, about acceptance and excitement from the population. Anything that stands out to you would be interesting to me.
Speaker Change: Our next question comes from Brooks O'neil of Lake Street Capital markets. Please go ahead Brooks.
Brooks O'neil: Thank you good afternoon, guys and welcome to the public markets, it's nice to interacting with you and there's been no.
Brooks O'neil: I have a couple of questions. Obviously, a lot of questions have been asked and answered, but you guys called out the year. The first pump to integrate with Abbott Libre three plus.
Brooks O'neil: I'm curious if you're seeing anything you would call noteworthy about that integration about acceptance and excitement from the population anything that.
Brooks O'neil: Standout to you would be interesting to me.
Sean Saint: Yeah, Brooks, thanks for your question. Appreciate it. I don't think we're really prepared to comment on the details of Libre 3+, with the exception of thanking Abbott for their partnership, which has been great. You know, we're CGM agnostic at Beta Bionics. And I think it's important for us to not get into the details of the differences between our CGM partners to maintain that agnosticity award. So sorry for that. Oh, I'm just press you a little bit, Steven, because obviously, there's a big difference between the pump users between the Dexcom base and the Abbott base. And I'm just curious if you think you're seeing a meaningful uptick from the new Abbott users who, for the first time, really have a chance to integrate with a sophisticated pump.
Speaker Change: Yes Brooks Thanks for your question and I appreciate it.
Speaker Change: I don't think we are really prepared to comment on the details of Libre III plus with the exception of banking Abbott for their partnership which has been great.
Speaker Change: Where CGM agnostic that beta bionics, and I think it's important for us to not get into the details of the differences between our CGM partners to maintain that.
Speaker Change: The diagnostic <unk> Award.
Speaker Change: So sorry for that.
Speaker Change: Hello.
Speaker Change: Perhaps a little bit Stephen because obviously theres a big difference between the deals there is between the base and the Abbott base.
Speaker Change: Just curious if you think you are seeing.
Speaker Change: A meaningful uptick from the new album.
Speaker Change: Users, who for the first time really have a chance to integrate with <unk>.
Stephen Feider: Yeah, yeah. Look, our internal tracking tools, of course, monitor the adoption of Libre 3 Plus for our business. And it's something we monitor very closely and we report to our CGM partners. But in fairness to them, we've communicated that we're not going to be sharing or bifurcating the new patient starts as to which CGM they're choosing or what our installed base, like which CGM they're choosing. So, I'm sorry, Brooks, that's not a metric that we're sharing and it's something that we've aligned with our CGM partners that won't be something we're going to share going forward.
Speaker Change: We have a sophisticated pump yeah yeah.
Speaker Change: Look R R.
Speaker Change: Internal tracking tools of course monitor the adoption of Libre three plus for our business and it's something we monitor very closely and we report to our CGM partners, but in fairness to them.
Speaker Change: We've communicated that we're not going to be sharing our bifurcated the new patient starts as to which CGM. They are choosing or what what our installed base like what CGM, they're choosing so I'm sorry, Brooks that that's not a metric that we're sharing and it's something that we are aligned with our CGM partners that.
Speaker Change: It won't be something we're going to share going forward.
Stephen Feider: My knowledge of the industry is that there are differences between Libre and Dexcom, so I think we should maintain that. To be fair, in the United States, we're the only pump system on the market that integrates with Libre 3+, so I don't think no one else has had to make that distinction, but there's a Libre 2, I guess, integration, but for Libre 3, you're fine. Interesting.
Speaker Change: Right now the industry or differences between <unk> and <unk>, so well, we should maintain well.
Speaker Change: Fair in the United States, we're the only system or the only pump system on the market that integrates with Libre three bus. So I don't think there is no one else has had to make that distinction but.
Speaker Change: Yes, Theres, a libre, two I guess integration, but fairly right through year end.
Stephen Feider: Let's move on. So one of the things you called out is the significant economic difference between the DME channel and the pharmacy channel, which is pretty exciting. But I'm curious if you could just talk to us a little bit about how you see the patient impact. of those economic differences. Obviously, no upfront fee is significant but $450 a month over the lifetime of the user. How are the patients reacting to that and how do you guys think about that? Yeah, look, great question Brooks. I'm glad you're asking for the clarification there. So there's a stark difference between the out-of-pocket that a patient has in the DME channel versus the pharmacy channel and it's massively better for the patient in pharmacy.
Speaker Change: Let's move on so.
Speaker Change: One of the things you called out as a significant economic difference between the <unk> channel.
Speaker Change: The pharmacy channel.
Speaker Change: It was pretty exciting, but I'm curious if you could just talk to us a little bit about how you see that.
Speaker Change: Patient impact.
Speaker Change: Of those economic differences, obviously, no upfront fee is significant but $450 a month.
Speaker Change: Life time of the user how would the patients reacting to that and.
Speaker Change: How do you guys think about that.
Yeah look I had great great Great question Brooks I'm glad you're asking for the clarification. There. So there's a stark difference between the out of pocket that a patient has in the <unk> channel versus the pharmacy channel and it's massively better for the patient and pharmacy so in Dnb.
Stephen Feider: So in DME The average out-of-pocket payment, I should say more like this, the out-of-pocket payment in DME to get the pump for a patient, depending on where they are with their deductible, depending on their health plan, it can vary significantly. But it typically falls somewhere between $500 to $1,500. And that's for the, again, on day one for the pump itself. And then to buy the monthly supplies, again, it can kind of run the gamut as to the amount you have to pay out of pocket, but it can be as low as $0. And maybe if you're late in the year and you've met your out-of-pocket deductible, or if you met your out-of-pocket max, your deductible, but as high as, you know, $50 to $100 per month, and again, in DME for the supplies.
Speaker Change: The average out of pocket payment.
Speaker Change: I should say more like this <unk>.
Speaker Change: Out of pocket payment and <unk> to get the pump for a patient depending on where they are with their deductible depending on their health plan. It can vary significantly, but it typically falls somewhere between 500 to $500 and Thats again on day, one for the pump itself and then to buy the monthly supplies again, it can kind of run the gamut as to the amount you have to pay out of pocket, but it can be as low as zero.
Speaker Change: And maybe if you're late in the year and you've met your out of pocket deductible or if you've met your out of pocket Max your deductible, but as high as 50 to $100 per month again in <unk> for the supplies. Now contrast that the pharmacy rise again I said.
Stephen Feider: Now, contrast that to pharmacy, where I, again, I said. hugely beneficial for the patient. The patient on day one, when they buy the pump, they buy it for somewhere around $100 or less. And the most common claim for the pump itself is $0. So again, you get the pump up front for nothing out of pocket, relative to the big number I just shared in DME. And then for the monthly supply kits in pharmacy, the patient's paying $25 or less per month. So that $450 number that I shared, Brooks, that's Beta Bionics' revenue that we generate each month.
Speaker Change: Usually beneficial for the patient the.
Speaker Change: The patient on day, one when they buy the pump they buy it for somewhere around $100 or less and the most common claim for the pump itself is $0. So again, you get the pump upfront, but nothing out of pocket relative to the.
Speaker Change: The big number I just shared in Dnb and then for the supply.
Speaker Change: In pharmacy, the patient is paying $25 or less per month, so that $450 number that I shared Brooks that beta bionics is revenue that we generate each month, but the pay the patient is out of pocket. If they are covered in pharmacy $25 or less so massive benefit for the patient if they are covered in pharmacy and if they want they want to use the island.
Stephen Feider: But the patient is out of pocket if they're covered in pharmacy, $25 or less. So massive benefit for the patient if they're covered in pharmacy and if they want to use Great. That's a fantastic clarification. Thanks for that information, Stephen.
Speaker Change: Alright, that's a fantastic clarification, thanks for that information Stephen I'll just ask one last one is obviously prime this is significant pharmacy benefit provider. My sense is a lot of their customers are our blue Cross Blue Shield plans.
Stephen Feider: I'll just ask one last one. Obviously, Prime is a significant pharmacy benefit provider. My sense is a lot of their customers are Blue Cross Blue Shield plans. Can you just give us any indication of whether you think that insurance channel is going to be very receptive to providing coverage to their patients, or what are you seeing so far from the Blues plan? Yeah, I don't. So yeah, good question, Brooks. I don't want to speak to the exact underlying plans and like what the names of them are that we expect the adoption and when, but we have, you know, had discussions with the prime this, you know, the folks at Prime Therapeutics, and we have a general understanding of when we can expect some of the downstream impact from this PBM contract that we signed to be.
Speaker Change: Just give us any indication of whether you think that.
Speaker Change: Insurance channel is going to be very receptive to providing coverage to their patients or what have you seen so far from the blues plans.
Speaker Change: Yes.
Speaker Change: Yes. Good question Brooks I don't want to speak to the exact underlying plans and like what the names of them are that we expect the adoption and win but we have yet.
Speaker Change:
Speaker Change: Discussions with the prime the folks at Prime Therapeutics, and we have a general understanding of when we can expect some of the downstream impact from this <unk> contract that we signed to be and yes. We do expect that there will be some coverage coming in in the near term and then sort of trickling. In later as we continue to have success activating the plan.
Stephen Feider: And yeah, we do expect that there will be some coverage coming in the near term, and then sort of trickling in later as we continue to have, you know, success activating the plans in the future. So, again, I don't want to speak to exactly which, you mentioned Blue Cross Blue Shield. I'm not, I'm not going to address that specifically. But, but, you know, I think my answer there should be sufficient. Sure. Very helpful. Thanks a lot. And congratulations on being public and getting going. Thanks, Brooks. Thank you.
Speaker Change: And in the future. So again I don't want to speak to exactly which you mentioned Blue Cross Blue Shield I'm, not I'm not going to address that specifically.
Speaker Change: But.
Speaker Change: I think my answer there should be sufficient for you.
Speaker Change: Okay very helpful. Thanks, a lot and congratulations on being public and getting gaal. Thanks Brooks. Thanks Brooks.
Operator: Once again, to ask a question, please press star 11 on your telephone.
Speaker Change: Thank you once again to ask a question. Please press star one on your telephone our next question.
Jeffrey Cohen: Our next question comes from the line of Jeffrey Cohen of Ladenburg. Please go ahead, Jeffrey. Hey, thank you for taking our questions. Much appreciated.
Jeffrey Cohen: Comes from the line of Jeffrey Cohen of Ladenburg. Please go ahead Jeffrey.
Jeffrey Cohen: Hey, Thank you for taking our questions much appreciated so I wonder if you could.
Stephen Feider: So, I wonder if you could expand upon a little bit on the payer side, particularly on the pharmacy side, as far as payers and covered lives and increases there and how that may compare to the healthcare side. Sure. Thank you.
Jeffrey Cohen: And upon a little bit on.
Jeffrey Cohen: So, particularly on the pharmacy side as far as.
Jeffrey Cohen: Payers and covered lives.
Jeffrey Cohen: Increases there and how that may compare to <unk>.
Stephen Feider: the other channel, maybe talk about how much of that has been factored into the guidance from a share gains side of the point of view. Okay, yeah, I think I'm understanding what you're asking there. And hey, Jeff, thanks for joining. Appreciate the question. So look, I think the right metric to understanding pharmacy reimbursement is the percentage of new patient starts that get reimbursed through pharmacy relative to our total percentage of new patient starts. And in order for us to actually see that impact, meaning where we have a patient that wants the islet that gets reimbursed through that channel.
Jeffrey Cohen: Yes.
Jeffrey Cohen: The other channel and maybe talk about how.
Jeffrey Cohen: How much of that is being factored into the guidance from share gains side point of view.
Jeffrey Cohen: Okay, Yes, I think I'm understanding what you are asking there and hey, Jeff.
Jeff: Thanks for joining appreciate the question.
Jeff: So look I think the right metric to understanding pharmacy reimbursement is the percentage of new patient starts that get reimbursed through pharmacy.
Relative to our total percentage of new patient starts.
Jeff: And in order for us to actually see that impact, meaning where we have a patient that CIO. If it gets reimbursed through that channel.
Stephen Feider: um three things have to happen first we have to sign a PBM contract and we've signed various PBM contracts some of which we've announced some of which we haven't we just announced one today with this prime therapeutics contract but that that being the first The second step is then we have to actually, the plans have to make a decision, the underlying plans have to make a decision to offer the islet as a benefit to their particular patient base. And so again, PBM first makes the decision, which kind of gets the islet or the device on the menu for the plan to then say, okay, we want to offer this to our covered lives.
Jeff: Three things have to happen first we have to sign a PGM contract and we've signed various DBM contracts some of which we've announced some of which we haven't we just announced one today with this prime therapeutics contract, but that being the first step. The second step is then we have to actually.
Jeff: The plans have to make it and the underlying plans up to make a decision to offer this the eyelet as.
Jeff: The benefits of their particular patient base and so again TBM first makes the decision which kind of gets the.
Jeff: The island or the device.
Jeff: On the menu for the plan to then say, okay. We want to offer this to our covered lives than the third step is that usually when that when the <unk> and then the the underlying plan make that decision. It's a future date for the third step is time and once that only once all three of those things happen then.
Stephen Feider: Then the third step is that usually when the PBM and then the underlying plan make that decision, it's for a future date. So the third step is time. And once that, only once all three of those things happen, then do you, do you, do you then have coverage and you start to see again, new patients starts actually getting reimbursed through that channel. So again, that's why I think, I believe that that's the right metric in terms of the share gain that we expect associated with, you know, the uptick in pharmacy, look, we think it's important because of the reasons that, you know, I just addressed with Brooks's question where we talk about the benefits for the patient, you know, that the financial benefit associated to the patient because it's much easier to access now the islet with the out of pocket costs.
Jeff: Then.
Jeff: Coverage and you start to see again, new patient starts actually getting reimbursed through that channel. So again, that's why I think I believe that's the right metric.
Jeff: In terms of the share gains that we expect associated with the uptick in pharmacy look we think it's important because of the reasons that I just addressed with Brooks's question, where we talk about the benefits for the patient.
Jeff: The financial benefit associated with the patient because its much easier to access now the island with the out of pocket costs. It's also easier for the provider, which I think I addressed with Matt's question earlier, and so I certainly think there is some benefit that we get a lift to our new patient starts numbers because of this benefit that we're offering through pharmacy.
Stephen Feider: It's also easier for the provider, which I think I addressed with Matt's question earlier. And so, you know, I certainly think there is some benefit that we get and lift to our new patient starts numbers because of this, this benefit that we're offering through pharmacy. And then I'll just reiterate that in the medium and longterm, it's, it's more lucrative for beta bionics too, which is why it's a core strategy for our businesses. It's an advantaged pricing structure for our company too. So Jeff, I.
Jeff: And then I'll just reiterate that in the medium and long term, it's more lucrative for beta bionics too, which is why it's a core strategy for our business is it's an advantaged pricing structure for our company too.
Jeff: Jeff.
Stephen Feider: Yeah, it was a good question and that sort of gives you the landscape of why pharmacies are. That's helpful.
Jeff: Yeah. It was a good question and that sort of gives you the landscape of Wi pharmacy is our strategy.
Sean Saint: And then one more if I may. So, I'm trying to get some other commentary on the call about this study from 9.3% down to 7.9 GMI, as far as a somewhat non-compliant user population. Are you noticing, was the pointer, and please expand upon this, was the pointer to show the increased data control that the pump provides? Or was the pointer, as far as the potential upside, as far as compliance with those types of patients, and if not, they've improved themselves? Yeah, good question. I want to make sure, to be fair, it's a little difficult to hear you.
Speaker Change: That's helpful. And then one more for me. So shown here are some of the commentary on the call about the fall.
From 1.3% pharmaceutical for launch.
Speaker Change: As far as somewhat Noncompliant user population are you noticing.
Speaker Change: With the pointer and push total policies this quarter to show the increased data controllable.
Speaker Change: The pump evolves or pointer as far as all potential upside as far as compliance with those types of patients are therefore, if not David prove themselves.
Speaker Change: Yes, good question.
Speaker Change: I want to make sure to be fair, it's a little difficult to hear you.
Sean Saint: The data we presented was baseline A1C of 9.3 down to a follow-up GMI of 7.4 percent when used in the current fully closed-loop mode, which we defined as less than one millivolts per day. But on average, that group, I think, was at... It was less than half a meal call per day, I think. Anyway, I think the point of that data is that it's sort of several fold. The first is that the industry now is talking about fully closed loop. And we've heard statements about fully closed loop being far off in the future. But the reality is that any current system can be used in fully closed loop mode, which means just don't call a meal.
Speaker Change: The data we presented was baseline <unk> of nine three down to a follow up <unk> seven 4% when Houston, the parent debt and a fully closed loop mode, which we defined as.
Speaker Change: Less than one.
Speaker Change: <unk> per day, but on average that group I think was it.
Speaker Change: Yes.
Speaker Change: But it.
Speaker Change: It was less than half corporate admin.
Speaker Change: Anyway.
Speaker Change: Half of them you will call for that anyway.
Speaker Change: I think the point of that data is that it's sort of several fold. The first is that the industry now is fully closed.
Speaker Change: Statements about fully closed loop being far off in the future, but the reality is that any current system can be used in fully closed.
Which means just don't call a meal. So the question that we all have to answer is how do these systems today work when used in that mode, because they can be and where do we need to get to with that.
Sean Saint: So the question that we all have to answer is, how do these systems today work when used in that mode? Because they can be. And where do we need to get to with that? And the reason for that, point number two, is because the fact of the matter is there are users out there today that historically have not been willing to engage in their technology in a way that produces a great outcome. And fully closed loop, if it works, is a way to ease that burden, which is our goal. So we presented this data, I think, indicating 70.4 being, I think, a pretty decent follow-up GMI, that there are technologies today, notably Islet, that can get this comparatively disengaged group to really quite good control today.
Speaker Change: And the reason for that point number two is because the fact of the matter is there are users out there today that historically have not been willing to engage in their technology in a way that produces a great outcome and fully closed loop.
Speaker Change: If it works as a way to ease that burden, which is our goal.
Speaker Change: So we presented this data I think indicating 74 being I think a pretty decent falloff GMI.
Speaker Change: That there are technologies today, notably islet that can get this comparatively disengaged group too.
Sean Saint: These are not technologies that we're waiting for in the future. We're not developing them. They're here. Yes, we will all continue to try and improve outcomes and reduce burden, but I think the real point is that there are better technologies available to produce better outcomes today. Does that clarify the answer? Yeah, that's super. Thank you very much. I appreciate you taking our question. And I've just been reminded the metric that I was struggling with earlier is on average in that group, one meal call every three days. So that's not a whole lot. Thank you.
Speaker Change: Quite good control today. These are not technologies that were waiting for in the future. We're not looking we're not developing them they're here.
Speaker Change: Yes, we will all continue to try and improve outcomes and produce burden, but I think the real point is that there are better technologies available that produce better outcomes today.
Speaker Change: Clarify.
Speaker Change: Yes.
Speaker Change: That's super Thank you very much I appreciate you taking our questions.
Speaker Change: Alright.
Speaker Change: Just been reminded the metric that I was struggling with earlier is on average in that group one meal call every three days.
Speaker Change: So that's not a whole lot.
Speaker Change: Got it.
Speaker Change: Okay. Thank you.
Operator: Ladies and gentlemen, that does end the Q&A session and conclude today's call for today. Thank you for participating. You may now disconnect. Thank you, everyone. Thanks for watching!
Speaker Change: Ladies and gentlemen that does end the Q&A session and conclude today's call for today. Thank you for participating you may now disconnect.
Speaker Change: Thank you everyone.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: [music].