PODD - Earnings call transcript Q2 2022

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Operator

Good afternoon, ladies and gentlemen and welcome to the Insulet Corporation Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct the question-and-answer session, and instructions will follow at that time.

As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Deborah Gordon, Vice President of Investor Relations.

Deborah Gordon

Dilem. you, Thank thank quarter and joining for us Good earnings you call. second XXXX Insulet’s afternoon, for With are; and call. and and today Wayde Bret me for Executive our Chief McMillan, Chief today Christensen, portion also Executive Jim Commercial Hollingshead, the Officer, Vice with Vice Q&A President Executive Chief is Officer; and Financial President President us Officer; our of on guidance XXXX this Investor available Both the our results and of of section website. the discussing call second the will and our XXXX replay release press quarter be Relations

adjusted is assessing measures with are our Before also to you interested could we explanation detailed namely uses this by discuss respect the to cautionary investors, current We’ll performance, performance, begin, measures inherent to operating align supplemental SEC call constant the what EBITDA excluding and believe we I as such would and with of other statements. in refer foreign differ of materially operating non-GAAP that Insulet of filings like inform These Please for course and analysts measures helpful of made period. certain of in measures the expectations. period statements a growth, parties our our effect performance as operating from revenue and revenue, exchange. adjusted forward-looking, which financial limitations our from management may be to margin, they during statements to currency the

call on Jim. basis constant to will growth the basis. revenue Additionally, a on unless exception otherwise stated, reported be turn that, regarding I’ll currency which percentage financial all with year-over-year will the With rate, be and over commentary a year-over-year dollar changes of

Jim Hollingshead

of I’m be business. sustained you expectations This across today Deb. Insulet. resulting revenue for with thank CEO from past earnings first joining and you Thanks, call we quarter, our excited as afternoon, exceeded to us. on my momentum here Good our

our high second and was Insulet given at new starts, no new level. advanced meaningfully year companies full macro customer the delivered is outlook each we that through had We are are imperatives. quarter Omnipod, team task, for starts and global and a our halfway the customer the and facing. year highest of US executing entire challenging We environment increased US Accomplishing other strategic our global this easy internationally record

entered We are to changer feedback have is transformative incredibly remarkable technology would our the pharmacies. thought our release be been is Omnipod Omnipod healthcare teams broadly retail and excited have X game provider are now through positive, has been to we doing X. market recently And overwhelmingly for full results the launch. it available proving to-date Customer amazing. The a and be. executing differentiated job

well, CE in a This very being CGM X is plan by bring reimbursement. Mark which milestone market, submission the are Omnipod toward world. approval AID we to one Our key progressing our and This stretch in driven represents diabetes to in review is approval. participate international people final to largely strategy with step the in the is our around

our advanced efforts. also have We clinical

and X X superior alone. US unique due non-AID the trial efficacy X population, X-months X we shared soon and controlled thrilled currently clear, young Omnipod X Omnipod demonstrate we’re can that are to indication a at insulin to further children our the the vulnerable Omnipod for confident in can to bring highly be for near-term value data and adopting CGM two pumps their Omnipod enrolling a segment and in compelling randomized population, population. Type XXX-patient We X market is powerful to the this FDA Type how Omnipod France And compared families for submission proposition. deliver that progressing the to and to demonstrating is X to abundantly well, Omnipod down value ADA, are The for is Our in an clearance. expanded age very US we for requirement in

our future support which our strategy. ground facility, international capabilities broke we Malaysian will our Lastly, manufacturing and at expansion as redundancy, strengthen global well as manufacturing

of back a our years the quarter team CEO. to want view my I progress, Directors. moving the on of Insulet Before on strength of as take first on reflect the a and the was commitment Board months aware I and into entire broader from two my of three step

even I’m more CEO, impressed. I’m that Now

globally improving important. improved Our global and last organization. millions awareness access outcomes and diabetes improvements and teams of years. and our to provide pervasive keys Insulet’s epidemic the more and Type few The improve clear inspiring ability innovation excited portfolio, is small I’m on diabetes from and growing Access and product unmet with Expanding serve will to the lives the passion exceptional. people that and are people lead driving of commitment to Insulet levers our global are penetration benefit most increased technology. of team, the a throughout been percentage the that the Diabetes is X over are lives, delivery privileged shared importantly, of mission coming is our a business only years, drive Despite the journey. forward. awareness never over to has It with to that needs have important we insulin roadmap, is significantly

common now coverage with the Omnipod in lock-in X customers payers. We’ve population eliminated customers We’ve using combination provides pay winning of nothing. Omnipod terrific and this the and are awareness US. lengthy outcomes. DASH access, through for making costs, The more a than the both from in Type XX% month paid of easier including channel, lower people we globally, combined and and that our populations. costs less and to majority approximately while periods experience pharmacy vast upfront delivering continue pharmacy our unique $XX affordable functional new each many X model risk Type access which capture That’s one our continue also to X a pay-as-you-go X, a resonates US and customer coverage and US that improves with improved the customers. the we which and injections, delivering for and daily broad our built Omnipod access channel, in leadership an are for building better And progress removes for with for DME easier We multiple securing are position

Our and pharmacy channel connect pay-as-you-go X diabetes. also business with people Type models with

an what represented X acutely almost customer population. offering Type on during and the evidence supports is the making XX% focused can are Because We clinical for compelling, of our access providing more affordable, X simple Omnipod users quarter, and that form do starts. generating Type so factor new Omnipod second the US unmatched

from expect for use Omnipod X that because percentage more Type customers see as we’re with is now confident the indicated advertising it mix adopting ahead our our and program continue of to DTC people Omnipod a new of customers X new lives X Omnipod market awareness X A their this full Type impact to wanting campaign. care component AID with of and excited Nevertheless, with number a QX ability as is are learn change population. is to see release this case prior it systems. market people and adopt can expected, reduction percentage we the the accelerated quarters, Therefore, Type penetrate with our Omnipod all efforts strong of further since of the more This they people in DASH, in with spend. As to release. we about direct-to-consumer to We our and in we have begin X. is this we ramped saw continue and have has Omnipod major underserved in on about. We X X our remain full those resulted diabetes,

efforts expect than We experienced what will Omnipod our Omnipod have DASH. for effective for X be more DTC even we

we’re with started. spends with to We’ve smart system mind. to of and knobs bolus tethered first more DTC time Omnipod getting the in to the pump. door and markets. select humbling for has visible his X. longer improved, outcomes life. Omnipod switched Omnipod been because been and lives. couple insulin the plug it their incorporate for individual a us Omnipod want no an who from countless and compatible We awareness brings heard An are firsts phone data told and first his blood decade top sugar, customers to tubes, and individuals life stories now using including AID had to It’s international directly with the He after on fully just stories it’s Customers first market. of have recently in one live X pod-based first worrying AID to a also a inspiring X, focusing we’ve the I caught calculator to the how drive controlled and diabetes has of trends. he love XX from His dealing system, system, about number of That’s impactful on pump heard adopting the to of that share for to no using over overnight his of being years getting nuisances access

called the amazing stories the largest "remarkable". years. We but X during also full and X X leap X that representation all X is These and common is the lived noted stories ever customer are our thread how of seen. QX, people over he clear redefining evolve physician Omnipod new disease is Omnipod it’s to manage XX very of connects system options from Omnipod In having Omnipod we represented market experienced heard He testimonials continue treatment has This for a he’s a from is with powerful. hear and has diabetes two lives that physician in already it’s who release, our just impact improvement X time, making users. limited Type users. a seen small quarter receive starts. change, XX% US of their Omnipod the from simpler. The first There’s their that we

to broader including of with XX,XXX pharmacies. that market the full percentage supply channel, expect we to We through wholesalers that a release retail distribution our accelerate now US approximately products sell as all

coverage where QX. a increase is and also for we were XX% are from securing covered outstanding have well which DASH, of when Omnipod X, ahead Omnipod We over for launching success X. Today, lives having we represents significant Omnipod

timing. retail, in Our expected job, a pharmacies the to expect an our amazing to progress and available anyone order coverage into team mail next. with through make the with X we meaningful this and specialty and and of year has now line prescription is rest fully Omnipod done

professionals improvements limited about healthcare easier trained, tubed provided implemented which experience. to the simplified are market small how dramatically a pump all with and especially board release product key our with more coming Already, ever customers interact a users, than have on from before. transition those are Our who we virtually of and learnings resonating

personalized with works is the the system the of it first them to therapy the of out typically Omnipod on automation box other and change. learns few one all care fact, to days. Omnipod burden and do for second work physicians X the Omnipod X Quite individual ability X that, first during physicians. clearly learnings to the shared for their differentiates and patients then In or personalize the user, from key within simply, rely and can and patients significant on each market. work systems pod the eliminates the This between automatically pod adapts of first

peer-reviewed many by the our that The clearly study’s surprisingly, from the competitive our X loving Data the target were not which Although experience. we journal, are initial at come clinical phase, market the Diabetes strong from Extension on we customers X and results were published MDI, the saw ADA Omnipod pumps recently during Care. shared new in continues demonstrated be Pivotal Preschool built people to benefits Omnipod of

It X.X% attendees first durability average During The around extension was Omnipod see. the for ADA as well the data improved baseline. achieved people at feedback HCPs Omnipod something as through many maintained robust pump with important lives the have and mission through remarkable extension in diabetes adopted this power only. studies the and Omnipod clearly to Omnipod X can met of booth accomplishments look attendance of hundreds at we Omnipod AXc during since with have ADA is. room improvements marked the stood shared and these overwhelming patient to with X at of of X for receiving of our end change in the patients phase products preschool of the year. And here case meaningful demonstrate as an globe held most We technology. sustained study theater how three-month standing range experience showed in percent success users where our Omnipod our that our individuals hypoglycemia offering. time The X.X% MDI and that of extension the phase. phase, how X another critical a Overall, product also Time around demonstrating and We had tubed clinical was to X. compared of population. the The out who clearly highlight our was that and forward their and engagement levels and real-world the demonstrated opportunity indication AID the really to this the phase, was

innovation We are also our pipeline. advancing

generations with Dexcom working development and closely of next our CGM iOS and the developing We’re partners, X, Omnipod Abbott. our furthering

Our innovation and diabetes priorities data-driven market, focused our their addressable and customers technology, creating next-generation on our management for our are easier physicians. building digital make and products growing to AID

operations. Moving on international to our

a bring business the our the way swiftly X to mid-XXXX. and next around Mark of is customer focus CE Our in reimbursement. is plans, is through we look approaches Omnipod clears launch with an data markets approval completing work to milestone first over a international cloud-based to is for us Mark submission couple world. platform, CE our seeking moving regulations, people This compatible protection and Omnipod infrastructure expect X months. review, entering developing experience as to forward we important the and that international channel on we for Omnipod transformative country-specific local and X

We we to ensure we operate. will entering take successful which launches markets a in each in staged country so approach can

is In to bringing new Arabia. United in regulatory local and working addition building we well Omnipod markets, markets in available Emirates and Omnipod recently Arab global and our launched advancing strengthen we X international will as we’re competitive DASH to goals. reimbursement efforts These to to enter our and teams Omnipod us and Omnipod markets serve our the Saudi X countries, position. now and bring continue XX

global range they supply a to as do the across Lastly, presents for inflation, and challenges industries. most chain manufacturers Insulet each of significant

resiliency, needs of supporting navigate ensuring continue customer supply, our our product X growing headwinds global these ample However, we to Omnipod and increase the including and the launch base.

risks mitigating our securing supply are We ahead of well needs. components by capacity

is of employees impact current While in million five that are of represents our to Bahru advantages, near-term on Malaysia, ground future we our steps margins, at advanced customers. to house cost at ensure for a further uninterrupted increased more will footprint our years, efforts manufacturing approximately manufacturing strengthen this approximately in an recently than supply capacity. We and comes facility feet a $XXX many The these have new of next over XXX,XXX future turbulent provide and we our located broke the appropriate times capabilities. will the competitive Johor location in XXX global operations of one the an at and full-time taking investment square manufacturing space our

for strategy to suppliers Our and includes responsible plans of regional have our outlined building components sourcing already in design. and resource-efficient local the environmentally utilize our materials we use

our of our redundancy, XXXX. talent a international build global begin of marked support commercial new market financial, quarter to operational number second to expansion and manufacturing the end strategy supports our milestones. operational expect increase We the production at and by closing, In future This efforts. global facility this facility base

to to mission entire with to Our continues customers. team an Insulet commitment our execute our unwavering and

are proud call Wayde. the we quarter, we now are We growth. sustainable accomplishments stage turn the and I’ll all and to the for achieved work of this setting over long-term now

Wayde McMillan

US of the record Omnipod QX customer the Jim. of notable and in time a we quarter launch another range US within as made full delivered progress X Thanks, We’ve starts we great and expected. commercial achieved number including new global of milestones,

guidance offset QX Omnipod currency a the navigating in XX% a We our quarter, each on customer high benefit of revenue, record On from growth inventory estimated inventory growth X. Revenue partially channel classic our contributions a was revenue inventory maintaining build, initial range. compared Omnipod distributors. pharmacy by our including starts $X be driven of focus chain Omnipod volume the headwind generated and from foreign and challenges basis the second million reported channel, for increasing revenue supply advancing last inflation growth reduction at compounding X Omnipod US finishing build, included an of total basis, our consisted through fulfilling imperatives, are our QX and the by exceeding and XXX new end Omnipod which We above mission. DASH our was of guidance point revenue range. continues to of US year. XX%, net of strategic to

comprised Omnipod million XX% Additionally, as sequentially DASH Omnipod and and XX%. the combined, approximate were US an rebates a up X, a periods. $X approximately XX% favorable from over reminder, new at over catch-up prior DASH earlier QX of of starts, to customer customer new for year comparison of Omnipod our included X total in Omnipod starts

channel International impact of the our headwinds pharmacy by X,XXX guidance total our of increased basis, Omnipod prior low point driven volume. by past reported foreign to adoption, the compounding revenue volume and range, Omnipod over offset currency a addition, On In at year. US XX% DASH over a competition X% pandemic’s basis the end headwind was increased approximately partially year. AID

During costs pharmacy US growing Omnipod and lives DASH Omnipod higher partially manufacturing operations, accrual X given well PDMs mix all the ramping, of attrition The higher Drug were basis a consistent. the revenue primary mix range. points representing basis. decrease declined XX%, remain XX.X%, currency global for manufacturing on as related inefficiencies or a with of the they US line drivers QX, age, estimated as higher by our battery our constant we expected volume point through margin for in XXX channel. Gross and ramp basis as both impact utilization a costs costs XXX was pod to warranty our Delivery as guidance offset

continue US Omnipod included the remainder the volume of our a the X component of inventory. out reminder, in associated will for the facility, sell the the year we above were and pressure Operating with Retirement higher million gross expectations as this at former $X.X as of costs growing higher inventory million volume margin balance to As legal to mix $XX.X Services costs our our product costs manufacturing expenses of of Advisory well as CEO. due and of

international expenses global operating launch sales support were such were higher Omnipod investments in of in charges, scaling these year, continued as and QX and and continued legal Adjusted Excluding investments growth. our transition costs, last QX, unfavorable the operating and and foreign and X.X% gross Both pressures efforts, to marketing, the X our by than respectively. and business to margin currency. margin our innovation due expansion, expenses EBITDA which increase in operating X.X%, CEO were adjusted in impacted exclude

to Turning liquidity. cash and

growth. the quarter we our the strong revolving secured to across and under quarter, the facility. in our of Overall, During financial $XX to an business credit our with million position is provides flexibility sustainable availability and $XX credit long-term additional million over million $XXX facility. ended available We under fuel our cash full invest

Now, XXXX guidance. turning to

a We are year full XX% raising range revenue XX%. to to of

revenue Omnipod, both are which increasing growth for to pay-as-you-go will increased through DASH volume our volume US Omnipod to our customer our release. X the market increasing the model, we full following For XX% should Omnipod pharmacy be Type our by of expand benefit and Revenue driven range channel, and primarily X, Type XX%. base, X

time our and revenue annuity-based adoption X from business As the reminder, a launch significant given will model. ramp Omnipod take

Omnipod to Revenue markets. competition For driven sold our will our XX%, of by we in in is to all the full X% adoption, reducing DASH which impact international are related AID growth revenue our to Omnipod, guidance ongoing markets. of international year be

an in growth comparison due the We conditions. easier expected highest fourth an quarter as improvement will the the revenue well expect in year as to COVID of – international be

a XX%. range, decline we Lastly, guidance revenue XX% for are drug year full delivery lowering of to to our

elevated as result As a the pandemic. a were XXXX levels of reminder,

higher XX% expectation now previous with ongoing the margin. gross the XXX expect a to in manufacturing US points XX%, environment. as chain to and encounter from broader macro basis of we inflationary XXXX representing to continue of warranty Turning costs, associated range Omnipod and pressures a decline costs and supply X We higher volumes, ramping our

Omnipod On more margin have to a also meet lower impacted costs. from partially continue product to with to enough will and ensuring basis, be associated manufacturing we mix, revenue, headwinds, line components warranty delivery strategies gross by mix ramp, these capacity due higher while than our execute to We including product year-over-year drug US costs expected X, offset our demand. ramping manufacturing inflation

partially the US channel. the We of offset volume in these benefit by expect be headwinds to pharmacy increasing

as results product expect mix, US couple We the next continue macro-related as ramp, for well supply chain manufacturing inflation the to of years. headwinds our unfavorable and impact to

and scaling Omnipod expect well We innovation including rise year-over-year, clinical driven ongoing increasing sales expenses and our as DTC our advertising, by as X, operating and launch efforts functions. our the efforts, marketing investments support of to in and expanding pipeline

single-digits a CEO the be the transition legal operating foreign as creating and expect of pressures. environment margin and reduction the and now the to macro Excluding costs, gross inflationary we exchange result margin in high

to due to Lastly, we continue slightly to ongoing expenditures expect of our increase capital areas key business. investments in

Turning guidance. third revenue quarter to our XXXX

to total exchange total to foreign expect reported impact approximately on XX% company points XXX a basis will on XX%, of growth currency basis growth including be estimate the for current XX%. we revenue. We Based XX% rates, Omnipod of

from of the For US XX%, of growth driven recurring and growing Omnipod, channel by volume benefits pharmacy Omnipod XX% through ramping contributions US X. our DASH Omnipod the we model, revenue to expect

We growth We the due on foreign to expect offset DASH Omnipod international competitive customer driven estimate X% reported X,XXX headwinds impact and a AID adoption, in basis. approximately unfavorable basis will the compounding and of to be XX%, XXXX impact Omnipod partially the exchange by starts points on the pandemic. XXXX, new QX by largely ongoing into

milestones that decline revenue conclusion, expect we X% number growth. XX% of for position revenue to delivery Finally, further Insulet is to achieved levels. as pre-pandemic drug normalizing to a we’ve critical In QX

these Mark and X, internationally. available now While Omnipod through X Omnipod CE with release soon, exciting the challenges, times macro-related be for to market pharmacies, retail there fully full are approval continues of

for throughout With and value customer to new We’re that, in in our on the Dilem, growth growth long-term call drive track of global future deliver sustain also order to please creation. another growth, investing and open areas business, while questions. key strong revenue year

Operator

Thank Larry you, Biegelsen Wells ahead. I sir. from [Operator line question the from show our of go Please Instructions] first comes Fargo.

Larry Biegelsen

taking and afternoon. you Wayde, to release the change a I a know full know big the Omnipod congratulations here. margins, given quarter with question and of was the Thanks for on that actually pretty nice you wanted Good market that X. start

understandable QX. totally this when had? can I’m what’s know So, margin love and the margin happening get margin you the know that the operating margin thinking to QX thinking year you you do and recently how gross on color think And some XXXX? you you’re for and about back in about I’d leverage to question. that gross beyond you are Thanks XX% you how gross taking And OpEx.

Wayde McMillan

Larry. Hi,

stepped So this we as them for micro mentioned, our for both and some margins, macro down issues. quarter you

know well from across an exchange, the environment and many inflationary companies, we’ve as been You tough, macro both publicized has that and I foreign as think is felt well.

have also the of in a that things couple quarter. us impacted We

in Acton increase warranty on some PDMs as talk And the volume we’re for a then our our highlight as well folks. increasing of us about facility. our that saw You just

saw us line. higher delivery. for margin our down a guidance drug product You margin That’s gross take

X. guidance And so for us. And our a we’ve there, headwind when we volume for that’s increased reduce then revenue Omnipod

well. Omnipod And for higher Our even are X sold we for of thought. above cost Omnipod slightly expectations X as goods originally what are growing

although growing So, a to is X, we’re goods that volumes good sold. it our with of Omnipod a that’s thing cost headwind

gross operating to really through impact is what and X% that a margins. about creates margins, drops that to So

environment inflationary costs well other there other that given wage operating throughout out have the are as as expenses, services increased with. companies most headwinds dealing also We and

inventory here. we know is to what do a closely And continue period have the our inventory beyond changed we but be cost and higher we’ve deferred we a with at great time. higher we that, to capacity. inventory, the It’s of to that’s little inputs, over you cost. our and guidance. can in that reason components environment, So grow are for a expectations is a coming it operations our see too will And the that job materials to in monitor it that growing tell we build environment doing built, as XXXX, six-month identifying this paying macro a lot raw of What are inventory is early capacity of teams

be what that’s so gross starting will to And already next our year. impact margins

happy capacity, although to it be inventory developing very building come a cost. does at So, we’re and extra higher

going point, to to going that this impact look Larry. at out that’s some time. not so for beyond us we’re And But

I focus what got think particular it we any the will margins and headwinds continue us. we’re be in to macro to can time. over to are year, the It time, gross we’ve like. commit with not key is margins, What that see and environment that’s we monitor looks a expand to operating margins going on macro may us for with expand count especially to that you But over dealing today. to continue

Larry Biegelsen

Thank you.

Operator

of Robert Morgan. JP ahead. And Please I show the Marcus our next from go line from question comes

Robbie Marcus

a on congrats and nice question quarter. the taking for Thanks Great.

of patient X new and all at mix patients settle to X even lot. Type the will the Omnipod already switching How over just to imagine patient And I could these about you’re Omnipod percentage the I’m a would as? As it exit Thanks these talk than starts, other out do US think you XX%. your new higher is that. Maybe is Are therapies? X in new high the Are changing you was therapy? short-term seeing? of Type relates surprised, from mix? X rate this a types

Jim Hollingshead

Thanks, Robbie. Thanks for the congratulations, too.

to a about out. it’s settle say little going early think the how to bit are rates I

the happy very across of X board. Omnipod with adoption We’re

customer our than starts patients know that’s from coming you MDI, new are – you said, XX% we of As and our know so more target market.

who shows know they’ve DASH. to Omnipod We it And of me, you that’s are from is converting because demand, know seeing the what great experience, high patients we waiting been a on for already Omnipod X. a are of Omnipod percentage that, sign patients

already. if market to actually, and release, market get conversions we’re a I DASH get Omnipod an telling the And you so an then getting of higher And fastest X remember, we’ve been limited convert. to is during what percentage Omnipod think, the somewhat is way

pump tubed that we seeing well. from we’re And other offerings. are So very conversions seeing

with so the and we’re And we’re happy a getting really board, across mix that.

Bret Christensen

Robbie, Bret. it’s Hey,

Just in little bit. to a here draft

rate. the asked You about exit

entire XX% yeah, So our the pickup mix there. was good for quarter.

So full remember, we market just entered a release.

rate you the a quarter, the the exit really as than can quite XX%. so was ramp And imagine, throughout bit higher

So, QX we’re expect be is a mix of to should you our going going into new X. QX, higher spot in a much starts as great Omnipod that

remember look look really thing there’s know other what I data a The component you IQVIA on at there sort a good a which new product. prescriptions NRx, of new is, of to is way a to called starts usually understand many take are, to at

Omnipod the pretty things And there. Jim high. conversion. keep percent X, it’s in mind just some For of there’s out called One, to

we of legacy conversions products. new that So are Omnipod X a large have our very to percentage from

The to is requires prescriptions. two Omnipod other X that, remember thing

a it a So kit requires pods. a for of refill and starter prescription

to team majority to and as you’re be so, only release, that market is going data, those. new at IQVIA just promotion sure is in you But to full – starting one viewing of QX. And the you’re excited of in full And you the the look remember Omnipod to thrilled just we’re want make that, be that conversions. to mode

Operator

Please line Bank I question go Travis of And our ahead. from Steed show of you. the from Thank America. comes next

Travis Steed

growth full XX% the question. Wayde, and first specifically half thanks looking taking guide year XX%, US the Hey. Congrats was the I the Omnipod XX%. US the for to at about guidance for for in and was the and

in second going away the the bit of half, but you comps seems do launching. X step Omnipod and So a have it COVID a down little

specifically. Thank X And guidance? in some the to much color I of our the the QX on with this So assumed How $X inventory you. of on Omnipod that then million was build stocking, quarter. wanted second get half

Wayde McMillan

it’s this color a to glad you here. little Travis, get Hi, Yeah. provide we question, asked more

all, you factor first of second out to channel the about and build, million half, $X that of that’s thinking the called you something as guidance. you’re the So inventory have first half into

QX we thing year, for and other comp normalize that had last an a us. to The for incredibly tough is, so creates strong

the dollar stronger channel basis, first build, growth a think and second So comp, if you about include normalization much a certainly for the is half tough half. actually and than on an the percentage the rate higher absolute

a on we any So into got guide factor build, the channel channel of second US year. our strong we’ve into half don’t major the And build inventory in really guidance. the

patterns we channel and some factor we them large or channel order stocking. normal past. and some significant know material some we just or see out, like we build a have But call do normal trends whenever the destock, You in

matches to Omnipod be at up so to distributors. And as on remarks DASH channel see could we’re our in build. reductions or talked of ramp. will prepared inventory we is continue offset how going in mismatched, about an our That X the and classic by Omnipod result it that And depending inventory Omnipod here,

But don’t when here, guidance. so we’ll And again, we destocking guys see we from remarks. prepared our material, that in let or stocking you typically and into our factor in it know in large build

Operator

And question you. line show comes Thank ahead. from next I our Lichtman from go of Oppenheimer. Steve the Please

Steve Lichtman

guys. you. Hi, Thank

non-AID, your that you are study you And programs, Have the what a on mentioned lot. pivotal reimbursement? feedback from is that for hoping latest you Thanks that study? versus Type clinical use Just outlook on a possible? the received payers enhanced is clinical to for X

Jim Hollingshead

Steve. Thanks,

for where launched customer X On Type with And an successfully comments, starts DASH, year-over-year. diabetes, obviously, patients we’ve we have we people – Omnipod to the first very of as in difficulty] use. X our we said our we where grow program, continue we and that have roughly Type indication had XX% prepared X [technical with new

factor, access data talk earlier model as the patients for Barcelona. with that, turn with study, X a which about we’re get And market we’re feasibility trial. published a randomized So all that form Omnipod we to we’ll closer conversation diabetes great pipeline. year to confident based in Type And on at And are pharmacy, We working for X. about the ATTD And pay-as-you-go in for with X very X we of published Type to trial. we and fantastic Type controlled with the know, have protocol on the great But as FDA tell going that about Deb differentiated. people to it. you more fantastic experience I’m on the already, we are the that in pivotal

Deborah Gordon

that you’re access of our grow driving Yeah. in markets. our Hi, controlled order doing focused excited really the to also about on clinical evidence, randomized and trial. we We’re in right, how are you? but body are reimbursement it’s And international

us ourselves with aware, offering do will own where negotiating AID specific or reimbursement either reimbursement is, and to our offering. category reimbursement we our it will help, the pricing with to higher tubeless out our not in is the we’re we we for And of data You consider countries for reimbursement should – be today setting the want certainly, from and we know system. that want the as what AID know you’re we with strength with chart believe, get help that received well internationally, RCT

the doing excited really So, about study.

markets. we of and seven patients new we in almost and enrollment in in soon the United And US people States enrolled because early in but our very fact, are already France, in largest be sites we’ll We enrolling two XX in our first actually market, they’re our on process, the have press.

we It’s many that to in in with of year X. markets really next Omnipod get pulling to order our ourselves just So the launch are one international excited. ready levers

Operator

And you. next Research. comes from Please Pasquale from question I go Thank Nephron line of show the Chris ahead. our

Chris Pasquale

margins. Thanks guys. quarter back to circle and on the I Wade, on want congrats

lot You talked if was about some takes meaningfully on margin, back you of and SG&A up puts stuff. even gross a the out but one-time year-over-year, of the

a then you. versus getting forward? there was that you the you it might detail little be moving there DASH? data X. out And just call of Are higher. Thank And Some anything priced on do there? price that a O think Just suggests curious, how about to premium one prescription

Wayde McMillan

pass the it, Bret Hey, and Omnipod start on I’ll Chris, over it I’ll questions X. on to

our about caught remarks, have Omnipod in advertising may of it front you SG&A, our on the lot regarding end in investment a increasing of we we prepared So direct-to-consumer have the investment talked X, certainly and both the release. of amount release we’ve the we across we’ve going got Omnipod for infrastructure both in is needs then significant a a as work way prepared amount do US internationally, many works system functions, got the cloud our and in from full with to and a X, here the market limited to differentiated And Omnipod through benefits of bring support HCPs system marketing, market and brings built really in particular, to we significant X lot of country-by-country in to what infrastructure the that know to our this you and customers. work and the be that have the and worked cloud IT, for

working And in every that. different the outside US. so country we’re on It’s

be things. aware other and to the privacy laws have of We

up what of you’re our lot Omnipod on show And today. a and there, over I’ll that’s in investment seeing it SG&A So, to Bret pass X.

Bret Christensen

and The Yeah. parity DASH, it would at of that. pricing remember, to we versus Omnipod to Hi, Chris. we’re price X sticking DASH, we said

we offered So for that mainly in reason you product. same we are the Omnipod the – around exact some exception might Omnipod The pricing remember, rebates DASH. offering that pharmacy-only and for a are to is payers discrepancies mix. X X And see

channel. So we in payers to offering do Omnipod we did have they that the DME DME in pharmacy few that and so move have a not were are X to

a payer, the frankly, exceptions. little at know bit but cause of channel that lift, pod price in few pricing So average just you per there’s with pricing, parity a pharmacy will for the

Operator

from from Joanne next ahead. I you. And Please line Wuensch of the show Citi. our go question comes Thank

Joanne Wuensch

and Thank quarter. you taking nice question the for

of you in limited have can learned the And arena US the so we you market what take version also? in in Thanks. should over there? the far a the prepare for here X, of As international launch international you think Omnipod limited launch that

Bret Christensen

Bret. of this can translate Joanne, to a learnings US, we most from European is launch. know the Yeah, the you Yeah,

– And training. a there’s lot Omnipod from so in remember, a different with Dexcom, It’s training X. and learned there’s partner. support self-service, with CGM our We’ve learn to lot there’s coordination

work well CE you launch those There’s mentioned, to got serve And And we’ve way of still on to CE work our Europe. will in all in still after we even are Mark do know we do. So to us well Jim when Europe. Mark.

will know effort they of in are on ‘XX will targeting So, markets be middle to staggered we launches. are and for come you that going Europe to the ‘XX, that move into because board, first –

the with pioneering remember, work And here. we’re to there’s So cloud. do

to You know, user. we every single be that’s first going on company are getting data real-time the

SIM a putting PDMs. in So we’re card

cloud the reimbursement a requirements building the in every environment. country. that We’re markets. reimbursement for that different then We’ve establish an meets we’re system and is Omnipod, for the potential assessing those looking we’re AID pricing to at of got And

in you a Mark, of come middle ‘XX. all-in-all, work CE expect those the to can So, be there’s launches done and to starting after even fashion in staggered

Jim Hollingshead

work we all mind thing in digging we’re a the pioneer to the on go bear that tag to that with one launch that, just moat. Omnipod know we’re and is, of X we you market-by-market, as offerings, doing I’ll back also of cloud-based huge Bret,

to going it do sequentially. We’re

to difficult do We’re going to be and follow. it anybody to right to we’re it do win. very will going for It

Operator

from And you. Thank show from I comes line Morgan Furlong Stanley. our question ahead. Cecilia next of the go Please

Cecilia Furlong

your what wanted the And taking afternoon X, that in for too, XX-days? market a was trial more the that, takeaways with limited that rationale on Omnipod the for just distribution just really question. you if made Hey, XX-days full terms ask and of launch? I to could transition of to color your then kind heels provide thank to free you you question. period, bit you And good thank just from the as taking you incorporated of from period or adjustments shifting

Bret Christensen

Yeah, Cecilia, this is Bret.

list there, options, MDI, really system what moving lot the adjusted is market that might onboarding for protocols, which comfortable AID So release. some there’s And to in market we’ve of be the why with again you of learned. expectation is we full to that, a setting the to some versus the with learn self-service we’re those got from and be we coming release. some we moving trading the an experience. has learned you we’re long lot LMR. commented what thrilled do We But on to the of full of know know A to

Jim Hollingshead

second think part are I trials. the And was, free the on

Bret Christensen

yes. trials. Certainly, free The

a with CGM. that system free question, includes know a a to that Omnipod Dexcom, X we X, trial XX-day do So, it you while great is Omnipod Omnipod and committed is XX-days are the we trial X, free because the wanted And was with to DASH. same with trial

that and there as want offer include doesn’t free partner our with Dexcom, not XX-day coordination in to really offering they a we a that trial, was we’re sure CGM. that a make trial So,

doing there and of coordination will us So that, to free into trials work but that X, you for committed offer. lot continue it’s a lot Omnipod we’re and went a to of something see

Operator

question show Please And go of you. I Kaczor next our from line William Blair. comes Margaret from Thank the ahead.

Margaret Kaczor

Hey, the good Thanks taking afternoon for question. guys.

of that what So patient means bit to follow-up a on I little for build and kind inventory domestic wanted the adds.

clip even like you know grew faster those I million, playing expected. was as a out it you model take patient domestic seems with quickly, adds $X if our than still Just that at

us faster any Or they to can know patient on you they’re domestically, they you side, new or to sense you revenue distributors strong hearing know if know already know you wanted the growth for around than example, in overall demand? grew much you’re domestic build And too Thanks. it of were is adds that be so of to whether inventory talk from it, of give why You terms seeing to say? then up because you supply? able to ready? So lack they’re need that’s patients

Wayde McMillan

don’t and Why inventory on to a product with it I’ll adds, he’s got I the maybe over start little Bret, the new the pass from Hey, the Sure. insights because Margaret, Wayde. it’s team.

timing you move in full just inventory Jim the And as And specialty is and across that happened way market had know then this market into the distributors to the the bolus remarks, as prepared those and inventory can feed said significant that’s retail retail we market order pharmacies adding when from to know you we of but held so his the XX,XXX move into you back retail on build, channel the large limited release. limited wholesalers of you when by you we know in pharmacies, country. as release, stepped release on recall, mail shifted So pharmacies, know some it the into we it pharmacies, pharmacies.

reductions to so as and at the channel And with if out quarter future. we does that’s have classic, builds with we’ll where the there, it inventory of X, and out we’re we’re inventory the the in continue on excitement timing. to the building that’s speak just much trying there depends mentioned get on that’s the why build access But of get Jim was Omnipod more prepared as DASH And remarks, there right, out we’re because major to you’re as we the end just one demand the the now, soon his in it well as and That on metrics as inventory ahead well of other access. can that full in market go get XX% were we’re that many over And there, release. now to can Omnipod order managing to out that people now we there are and prescriptions access X. and

the customer adds? from model end So one We of to our And exceeded to the you’re in channel from across quarter. reasons pharmacies get pretty access because a high the all annuity-based we’re it’s of add is quarter, that the familiar right, Bret, any and new country exciting that domestic the to of on the in guidance revenue people know the you color I that the want see But, with. amount significant that of just product don’t able the inventory any starts particular in. this that stocking we domestic standpoint, be in a adds you’re

Bret Christensen

that we love it’s almost communicate mean, with think drop project just look, the is the try to know you’d expectations And I here, at Omnipod our conversions. can rate this X – with Omnipod is fair product Margaret, it’s say you ideally, going as as we demand this inventory build I well especially mean, and just exceeded a Yeah. up. launch our distributors. to you But like see to inventory that’s know X. with something I same unavoidable DASH

have thing we did DASH, much product, have the Omnipod for different. just we for waiting have podders X one to And is our Omnipod we conversions So launched to legacy when from see but been X we demand for point was who But bit know you it to – more to again, we it’s a build. healthy, more keep conversions, a a and a minimum. just lot in is saw that And little lot demand, inventory time. resulted long try that and we of a

Operator

next Please go of I from Thank from line show question James. comes Raymond Jayson you. our the And Bedford ahead.

Jayson Bedford

– in I with detail the a on the well? the typically to congrats realized you’ve at I revenue to little progress. of as I was US. Jim, So implied XQ factor But international, for embark afternoon XQ said was down like lend looks quarter-on-quarter, international was FX here. was And ask wanted quarter-on-quarter? of doesn’t declines. why here, slightly to Good down a the and bit least down flat model on the there. sequential it probably a Thanks. the And it itself yourself quarter kind

Wayde McMillan

Sure, Jayson, well. is And we’ve as I can take one. what seen it’s this Wayde. that historically

we well. sell that when So and to time this business, because And annuity flows down. understandable question a international at Because certainly prior from and fulfilling sequential those depends ebbs have as beginning across and lot question, case what the we get this happening end distribution our the inventory it’s we we time. see at do an and quarters see channel, It’s of an is revenue orders. in years our model. and patterns But and through we’re the of the typically it’s distributor patterns we where order in

model. to that’s little But it. an So, because itself annuity it is to bit more it be understand, a difficult lends

material out that seen You’ve also out internationally, well. as whenever call seen had you’ve stocking a or us us we’ve nature, destocking of call

year, it’s and be quarters, couple that second seasonal think, the I that’s goes the a we as don’t, we calling into see as and between end. order the of managing when but swings see some just think QX half trend out well. QX we typically a So their we’re And well. And about calendar we I really move at decline of should the nothing dollar million year you’re up, concerned right, of in distributors, or as we inventory an the

to out anything here, we’ll when about really so, see Jayson, normal just other again, it nothing call than And material. know we some trends. you talk And inventory

Operator

from Thank go of you. Jennings And ahead. I Cowen. show Joshua line next the question comes from Please

Brian Kennedy

for This for Josh. taking question. Brian my is Thank you

do of guess, in for cost a to adoption? of co-pay? ability interest you match factor co-pays be On to big should cost. How delaying an upfront judge the an typical because have patients I as plans the a pump cost driver Omnipod cited you a purchases, or, of further do competitor lowering the payment X pump manufacturers And therapy, specifically current introduce that

Bret Christensen

We a important. more fee Bret, decided importantly, the the is is disruptive very we model, upfront think Brian, reasons of pay-as-you-go to very And to it’s have is Josh, especially Hi, ago, because years sorry. it’s the and met cost channel, not move their if it – deductibles. very for move why one difficult they pharmacy to patients,

these of and for co-pays the type $XX. pay pharmacy the patients they’re headwinds are the vast these something – So we you majority see than predictable And low. the remember, us, know in our of majority fluctuations, because don’t and less

than zero. So is that. lower many as pay average the Jim And much said,

the I final part your the is free know that’s you with of about functional really is So as think and you pay-as-you-go And trial, always can Omnipod we to. And try you we’re about if We for talk free, question that making. know then, lowering topped off model important. that you and just effort access. want an co-pays,

want want we’re willing to things. we percentage if some on we bit that We offs. every to want remove we to remove And give a high little co-pays. want it few prior the because a obstacle with to we payers to get Omnipod. get accomplished, cases, can do can in to on We up rebate remove So

Operator

line Thank ahead. Matthew O’Brien Sandler. you. Piper the comes go from show of from Please our question And I next

Matthew O’Brien

Thanks Hey, question. afternoon. for taking the

that you think stack started about on in low QX, know adjust QX. build for I XX% grew inventory you in you basis XX% low this. in of you QX, know talking kind Wayde, know So, two-year a you But if you

more two-year kind the expecting this mid-XXs big basis. QX, bump you’re of the a on of Now stack QX, in

acceleration X Thanks. here it So, Is pump where really is population? from Type I that growth Is that where specifically more it from? is in from an US? existing the users? expected come conversion in to the mean, patient coming

Wayde McMillan

think if QX. what know channel if Matt. first But you I’m the you I growth sure And normalize all half, quite I I inventory know in $X you’re followed rate do build, strong for you a not in that rates. is that million about saying you we right, math. growth XX% US followed have Yeah,

last and the that’s And and the given growth from? tough come of half competitive guide the said, where quarter. for comp where, look It’s as you you second QX is at the to Matt. in so, a we year that was pretty us, mid-XXs, then above, have exciting. all strong such that in going take then, strong a guide, you we’re especially And It’s

we’ve had product in As that itself, Bret before DASH you really are the pay-as-you-go benefits all know, model, the the business X what just business drive are economic of here. the the continuing all mentioned. Omnipod drivers that to The

in well differentiated as so, as Type And opportunity the channel. X pharmacy the have we in

Omnipod continue ramp. to a at QX the is new as to going will that that be the a drive starts customer then be continues to So, business. and what here lot drivers, to of of XX% continues in And X driver

and reflects in of we’ve know think I growth momentum US, the the you lot guidance So, got that. a

Operator

Baird. last go question show from Thank of ahead. our Dane And comes I the you. from Please line Reinhardt

Jeff Johnson

talking questions, quarter. that coming or and be as much the on be less revenue ask going that? full in at it Should on little afternoon, One, we way phone this now thinking for Or was some in actually having are than today. Is don’t we going clarifying, CEO some just keep CEO, in you least of apologize inventory is thought Thank you, to guys. as second you. as issues the as revenue I This said a as damned one-timer we the out. a line should you, up. old guy, Wayde, netted that about stocking about between tailwind near-term, is Jim, $X first quarter you’re cost to about is top how two you drive Dane. going wanted quarter But you’re competitive I then, know Good million spending Omnipod out the just we think of $X first or X to a is this mode Jeff I guess. possible. the push matter And conceptually your cost million?

understand to here, style trying maybe. Just Thanks. your

Wayde McMillan

I to Sure. be was you Hey, little going a actually disappointed Jeff, weren’t on. if

voice. your The hear is great So And it answer part first the was just $X really net. to quickly. million I’ll

So and coming ramping of classic Omnipod the inventory Omnipod and net impact that is DASH X down.

Jim Hollingshead

a and we a have on loving be first and Jeff, thanks I’m quarter, going damned. great passion. me my so great by as cost and strategy, way, an incredibly question, love this, don’t I and And the and for to be know, somebody it’s you And we question. have think your question. actually – people team to talented But of to think I great should who’s much you here answer it’s your your

front massive of us. in have We opportunities growth

thesis our the we’re investment to drive Omnipod same, remains know going which is, X. You

growth successful Omnipod We’re X. going to drive successful with launch and

going continue to We’re with international to drive growth DASH.

we to And be great very we’re that. to We’re drive with that growth of with Type market, continue do how going cost our going innovations and to to DASH. fund X are but we’re prudent going coming to all

environment macro a in challenges. of a lot obviously we’re know, You that presents

not are We immune that. to

across happening in that’s know happening You it’s industry. our industries,

be going to very going have we’re we we’re it. very of that. So us, capture front mindful we’re of with in fantastic to and But and growth prudent costs

Operator

you. for This CEO remarks. Please ahead, Thank like to Jim closing call the President session. concludes Q&A our I’d to turn and back go Hollingshead, sir.

Jim Hollingshead

strong we’re exciting the an another and X release terrific the for full despite really We’ve inspired to note, year to a goal thrilled Thanks, year, on I’ve market challenging milestone, with really the is thanks, long-term. growth sustain market drive our in joining two is growth for through be macro in months I’ve second been personal of progress The And offering. my in release been just environment. CEO. on full successful here us everyone navigate today. – quarter, that having and finish that to made inspired we’re and for Dilem, truly the to and Omnipod as and first our track

making great progress. We’re

people. people’s We talented great got and We’ve lives. changing are

MedTech, offerings. lives position simplify day. and better our been Insulet the everyone, the to of great of one management Thanks, people got a have deliver and on to teams at best we’ve a mission never and improve phenomenal in in We has have diabetes.

Operator

day. Ladies and Thank have wonderful your and a you for gentlemen, this concludes today’s conference. participation

all disconnect. may You

Insulet (PODD) 7 Aug 222022 Q2 Earnings call transcript