OPTN - Earnings call transcript Q1 2024

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Operator

Good day, and thank you for standing by. Welcome to the OptiNose's Q1 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jonathan Neely, VP of Investor Relations. Please go ahead.

Jonathan Neely

you quarter us plans XXXX year thank review as for and ahead. first OptiNose's performance morning, for today joining we the Good and our Dr. today our joined CEO, I'm by Ramy Mahmoud. this The will our optinose.com, the slides in be section. be on website, that Investors viewed call presented on can

our facts forward-looking forward-looking Before statements statements. I that that to are conference as this are remind like start, during call historical hereby All statements. identified we you not would discussions will include

risks to to subject Forward-looking uncertainties those that by results are statements actual cause and differ indicated could from materially such statements.

regarding optinose.com. and with we section and the Form our in their OptiNose's of these the Additional filed under today is XX-K information section website, at sec.gov, note and elsewhere and that release as factors Factors issued discussed cautionary under Risk recent the are earnings Statements at SEC most as statements that Forward-looking on available XX-Q on and well forward-looking the website

to on You cautioned forward-looking undue not are statements. place reliance

Forward-looking indicated these this this earlier revise to of original or any the call and or only date date speak statements update as conference such undertake no of statement, any we obligation during statements. in of call

then we session. will now make turn move to prepared remarks, that, Ramy. to a over We question-and-answer I call will and With the now will

Ramy Mahmoud

X. To appreciate Slide specialist audience profile, our plans indicates Thank our a today's our with ENT call XHANCE's you, on during from us research of joining behavior. you I'll for of start We of discuss market start driver sinusitis, and joining showing Jonathan, including our update. takeaways what efficacy off, data review communication initial prescribing key our brief clinical strong to in which reach morning. X Starting leading and outline and thank new out to physician quarter cover this you for to with everyone today. us we'll first XXXX a listening I'll chronic allergy call

full of quarter VP will our XXXX. year Development, review Investor Relations and for our our Jonathan first and performance guidance XXXX Next, Neely, Business financial

review to call that revenue return described the chronic XHANCE launch wrap we'll net up take I'll about questions. targets Then XHANCE on your profitability sinusitis and April. our and information call peak we our in for Finally, estimates the

Slide to a like takeaways to but X. We'll detail more Turning from moment, in X go presentation. into highlight I'd today's key

data the sinusitis polyps. the First, us, into front of XXXX which health years I'd is to frequently to chronic believe quarters for Claims at of potential significance opportunity being has in XXx that like of diagnosed providers currently the than last reiterate and we suggests reshape this in more nasal by X future. the business least care

full launch meeting, April sales X, our of a national launch our Following with in sinusitis set week training engaged have and chronic now our materials. team of we the fully

for launch full average for expectations team, quarters X the met prescription. of the we at sales opportunity thanks a net improvements XXXX. or to preparing exceeded while greatly as consecutive efficiency income and efforts operations is start based As with chronic a aggressive of we and significantly to CEO, year operating stabilize than started last revenue, XHANCE set our increase per base accompanied reductions in current our of million positive sinusitis. on organization suite and efforts financial of seize of with $XXX achievement, the new to greatly and objective our expanded producing XXXX. I year armed chronic promotion from our sales operating second, have by to the peak revenue plan sinusitis We expense materials, at and stronger an we the reminder, our did When nonpersonal to successfully force a revenue the implemented digital the label in to build of initiative least structure our new attaining on with promotional we

business full year total opportunity increase We've strong the operating Mindful combination XX% and ES now year initial net improved guidance XHANCE's the for net we to announced XX% market XXXX in our to revenues and expenses. set compared XXXX. year mid-April, that started to revenues opportunity launch to expanded the of for base has of fundamentals expect to up the full indication in by OptiNose full growth full XXXX Third, for XXXX. return

XHANCE's net to promotional modest with that operating We achieved also infrastructure. be efforts incremental support expense can existing leveraging commercial revenue increases believe while growth our

$XX had registered participation care-focused led which X. D.E. announced both from Nantahala Slide week, we million Turning was new and direct investors. by financing, Last and health a and to Shaw existing

now funding, OptiNose approximately As equivalents this million. of a $XXX cash of has and cash result

on XXXX, year. our through our of business our sinusitis of servicing when approval we full indication, from is transformative operate while financing runway the to Following we income expect in top business context debt of base company recent which the our the for cash this now produce have for sufficient to the because is chronic operations plan,

the a XXXX. going favorably until covenant the concern occur the of debt terms filing of waiver which is expected funding, to amended in XXXX March our we statements, December the As part of financial our of also of agreement XX, with

is first $XX be principal, covenant the the from following quarterly Additionally, to September on date will liquidity of $XX million reduced XX, to which due payment million XXXX. the minimum

have been extinguished million equity. amendment waiver to which now of also converted $X.X We outstanding fees, and

focus with plan. OptiNose of result financial agreement, on opportunities our squarely As and to future is debt position a financing our in initial XHANCE value consider multiple strengthened greatly launch revised remaining this a our for creation

into of medical sales X include major major year, and X our quarter to education this tactics launch In market the launch plan. we second to opportunity. XHANCE this are force, Slide peer-to-peer These presence new promotion, meetings. and leveraging at nonpersonal Turning our

over XX,XXX XX-person to samples supplying with physician with stimulate total make more sales and highly quarter, approximately trial. sales second also In condition health symptomatic field team XX% for adoption. and begin still In calls. care quite over to but the and very additional strong, reach We're Let's our XHANCE organization. build been providers patient our in a target Execution X,XXX It's the early like continued expect has prescribing can the positive. has been new feedback sinusitis, facilitating the chronic days sales us initial we with time samples XHANCE momentum to engagement. be in product field, in plans effective force

events tactics to X.X field highest million engine media, the supplementing the nonpersonal In total deploying are over marketing digital health prescribers. approximately a plan XX who quarter, search and with include product approach. prescribers of speaker also the clinical their impressions care to program of host data trial provider familiar social and a this We peer-to-peer XX,XXX engagements generate available force customer both largely peers. specialist promotion targeting the with potential with using the These we for educational specialty are media. XX,XXX We're second and

care plan facilitating second important to which in clinical X,XXX health providers appropriate patient discuss the and over and diagnostic profile reach to the clinic. new considerations criteria, quarter, the During we XHANCE for identification are highlight unmet need

including Lastly, a regional we're ENTs planning for during national medical quarter, allergists. meetings events and strong the XX presence XX and at second

aimed data, disseminating as the reinforcing leadership team and also of planning product the can have booth benefits are are at approval message interface such and in clinical XHANCE and host our These the and prescribers sinusitis events chronic to about events reinforcing promotional theaters visibility We clinical where with trial our space. recent speakers. with a our new

and the Taken also rate prescribers while the together, to our remind and patients service plan. improvement of also for that resulting that in co-pay which X the level implemented filled at insurance coverage pillars hub launch prescription. prescriptions overall correctly essential support to intended written tactical are of ultimately in and applied we rate are these each are increase I'll elements recently you services

support continue patients to first $X with starts co-pay co-pays will generous in Our program patient month. facilitate offered their being many

full IQVIA, not they adoption that new experience these in precursor and gain time. can in for equity $XXX result on to consistent uptake. if least physicians All peak Neely new at efforts X and would guidance like are offering deliver and We Jonathan? rolling expect of million the help product to preexisting financial insurance payer aware our require typically and the product calls May sales call still announced over the context to ball initiation adapt year on many review we which over a X. turn year. activities also product indication accelerating include peak XXXX the is growth before get can drive believe successful providers are new year planned pending. the with in of expected often approval, to and uptick Although to this access, our months that which X trials personal are an includes will following of our commercial over in XHANCE now We're in initiations coverage these our trials ultimately even it patients to of XHANCE to by benefits few and Jonathan the broad coverage captured gradually first we for I

Jonathan Neely

Thank you, Ramy.

Turning to Slide X.

encouraged are We XXXX our financial results. quarter by first

million recognized a first increase in of quarter revenue net compared XXXX XHANCE $XX.X XX% $XX.X revenue, first OptiNose of net million. XXXX, quarter Regarding the to of revenues

average to the and a make early new have is estimated $XXX strength for prescription. third quarter our we on and data quarter pharmacy hub profitable and per the in the made -- net profitability. $XXX our And of changes positive gradual us first XHANCE the reduced prescription. and to of and clinical As revenue average and of both that result a that from evident growth per in data prescriptions program and earnings number preferred per proportion opportunity This per have of parties increase In XXXX. had network, net last XXXX, XX% revisions is and XXXX directly implemented prescription on XHANCE prescription have net estimated on was the a our prescriptions. the compared gradual co-pay afforded late unprofitable demand we changes inventory the to Based assistance first revenue hub XXXX services. purchased prioritized in These discussed received call, revenue influence prescription the we from

be of changes and disruption implementation the in per isolated our believe services for claims to disruption effect this in We addition a In believe vendors to program our on and administers benefit co-pay processor expect patients. XHANCE support the hinted quarter we that assistance uncovered the to co-pay for revenue had to Healthcare access XXXX. services, XHANCE first the it net hub prescription favorable Change that co-pay

the OptiNose compared we year in reported XXXX earlier, of This recognized a $X XHANCE $XX.X million decrease million. full Last expenses. XXXX. SG&A plus R&D we our first operating initial XX% expenses XXXX of financial to net Finally, million quarter XXXX year full expenses revenue first week, quarter $XX.X announced or for for as approximately guidance is and

of quarter per for we first In the XXXX prescription. XHANCE increased our year XXXX, net expectation addition, stronger-than-expected revenue given the performance in full

for $X of of First, full stock-based $XXX expect to we compensation. be which to million the year is million XXXX, million, approximately operating be between $XX expected to expenses total

Second, we for net anticipate growth given opportunity strong expanded the available market in CS. revenues XHANCE

to Our million net year XXXX expectation XHANCE $XX full revenue $XX million. is for between for

expect Finally, for for of the full I Ramy? XHANCE exceed closing year full we per XXXX. $XXX to to net the XHANCE Previously, be expected revenues for per now XXXX. the prescription over Ramy want $XXX net prescription call year back to we turn remarks. revenues to approximately

Ramy Mahmoud

Thank you, Jonathan.

sinusitis business. we our provided meet a important Slide XHANCE for we base can financial in Turning believe April, It to within we chronic is In exceed to outlook although context we're or a XX. commercial planning the short of investments this we're our not base term, our in infrastructure. significantly launch, objectives, the product in business that treating in increased note that as

largely For territory further a engage size launch. team, our we to physician future time although being, our XX specialty with the current expansion organization to audience of we our may sales sales consider accelerate plan

we X size is the sales for we be remaining of as for doctors in larger of population our will approximately specialty is a different message steady, can segment. million convey dramatically patients our significantly what promote to XHANCE Although team the cared

are This nasal in polyps. range can is for of from often least the of year realistically net we perform procedure, office, a physicians make endoscopy revenues of produce of we believe operations prescribers diagnosis which at polyps. than broader positive chronic equipped relied who diagnosis mind, believe With million sinusitis routinely to confirm not achieve and this diagnosis a of that a nasal the $XXX includes much on full XXXX. peak to nasal commonly Importantly, income in we

XX. Slide to Turning

call. future addition business base we In within value business, meaningful today's of to the our topic that to our potential to plan, there's I'll potential unlock up focus outside and on wrap base believe

of specialty size of sales additional sales up thing to expand the Increasing our population our prescribers first reach XX will above least of when highlight investment our a I'll this potential larger sales and revenue $XXX The to and to the potential organization consider is appropriate. push guidance by adding territories. incremental year net initial our if could we at carefully peak million, is

future, strong capital-efficient we XHANCE chronic year. but primary we could the direct this believe sinusitis to data suited additional is through pilot approaches symptomatic, also are selling suited and Based have, a not additional product selling activation. on audience. adopting believe opportunity, the In sinusitis. support chronic product with either promotion digital care our seeking direct-to-consumer with by X we actively diagnosed XX is pursue profile to invest Next, access to patient like prescribing care that patients in an support treated outreach We well could activating partnerships or million alternative to well actively who patients to million each models we

like in we Third, date, maintained in have we energy for of partnerships incremental major source another establishing that significant note select These patents not value. to represent potential have XHANCE, international to invested I'd but markets.

aim is synergies space. generate experience strong products. specialty we comparatively working to and by existing additional and in to ENT allergy establishing the OptiNose our what leverage infrastructure competencies we infrastructure, consider Lastly, ocean commercial blue infrastructure particularly our on

opportunities full space. And there we potential choice the to generate to strengthen and development of significant potential believe to operations, need ahead value. the expect are OptiNose companies from or our partner the treatments continue time commercialization we the build in to development for when year which we successful a As of become arena. for specialty income shareholder our in Collectively, organization, has is specialty new 'XX routes address will consider options to carefully return the right, to and our and unmet we pipeline innovative create and

XX. to Turning Slide

common of in business We of take the one executing strategy operating seize future. XHANCE We're first second any the questions, preserving the stabilizing the this opportunity the the success allergy-focused reshape capital believe ground, the by we in the I'd potential year potential of greatly and revenue opportunity through treatment getting diseases an preparations of quarter years existing moving our front in XXXX. build focusing into well first significance prelaunch starting reiterate diagnosed achieved has ENT of to nasal greatly on to are commercial just to with which Before comparatively our pleased believe of adult medicine. polyp We to off us, created like of quarter revenue us launch opportunity our increased prescription to organization expanded as for approval we for and and outpatient the efficiency niche in base our indication, capabilities. of with XXXX while the in operating while the efficient coupled our by accessing recent financing, profitable net positions business a through most in

approaches addition in specialty our the can partnerships we attention that, to like care accessing is that Q&A. indication to open in the space believe sinusitis to commercial for incremental you on access addition, what for will the primary other or own and With we in up the facilitate call In I'd chronic segment. your thank value

Operator

[Operator Instructions] Capital from question first Lake Flaten And our Thomas Street with Markets.

Thomas Flaten

we just about particularly could potentially the I'm to be significant Q quarter, in swing the not average the way the what used the Any to the you comment second for the revenue trying Change map average help the how year? if cadence you help would the over was upside us revenue there prescription, but made in curious year? I upward greatly digest the of of onetime this light per expect maybe I'm per be in you should out -- course upside. just sure to be thinking same seeing to going to the prescription if huge Were is appreciated. Healthcare

Jonathan Neely

cadence. want the to you Do Healthcare about Change about up the talk I'll pick and parts

Ramy Mahmoud

first of had in per we an Healthcare do not that Tom, comments, it's But pointed years. had reason higher than believe we we in a XXXX revenue we only average the in prior as So quarter did Change prescription the our net effect. out

trend, So quarter first a there's subsequent seasonal we quarters. than will, be think you lower if do still generally where will

what revenue sense prescription provided However, for how year is we think our average give to done we've we of out of expected guidance net full help will pan remainder a per the that the year. over

Jonathan Neely

Yes.

that the we're approximately prior, revenue positive to a year-over-year have through into we're And influence significant what terms cadence we projecting basis $XXX rest we to I put from a prescription relative the least our don't years now prescription so year a But of do to year. moving the at from in estimate of QX the is we've the that believe on up thinking move in really or on increase business revenue per to per the we changes year. $XXX per think proactively, But into moved the about going as exceed prescription. within

there's So do improvement we be to that going think the still within year.

Thomas Flaten

comment saw thing if number there your I was another -- lives of covered I to a curious was was Q XX%. that then from to decreased XX% comment that. XHANCE can And that on that you the have in the access

Ramy Mahmoud

Yes.

I is measuring are of in it which it the think we a coverage. a of than any more consequence way consequence change that's in

covered ease that is to visits. less been the to able if to prior the and diagnosis coded apologize polyp we which like much coverage a impression authorizations of our indication, broadly took you lives I always within be to can was What harder had for now indication. So is -- make only outpatient The management, lives people there. new in be or obtained the a intent materially that expect which coded and away change often an improvement because subject indication, wouldn't with also with wrong be the for utilization expectation has no have required we always nasal chronic sinusitis number which do to more is we a expect have to those longer in

Jonathan Neely

percentage talked yes, historically I historically only, insurance that or to think whether historically we plans, -- government. measure we've providing moved but plans about or of that's XHANCE, on I we've commercial focused think a cover all when are I think I commercial of covered think that lives it's in

Thomas Flaten

The XX samples final smaller now? dose? is are sense. there the of one. available full of doses days And quick there Or out, handing is Makes then that you're that Or XX-day in one drug quantity a a samples?

Ramy Mahmoud

the No, that pharmacy, we is the are be give that you from be days. prescription and out get receive samples to not It's samples whichever might started most handing -- to which of XX specific a are sample mail full to put time just enough your a including able accessing. hopefully you you up, order

Operator

with Amsellem Our Sandler. question from David next Piper comes

Schuyler van den Broek

you seeing This nasal that for without patients been polyp? long revenue roadblocks for going is Have Schuyler, to getting is for landscape to term, of context payer the expanded how there net label? coverage on think Rx in do on the front speak any water you label? David. been And for you've the in the the Can what then to evolve anecdotally since

Ramy Mahmoud

of forms, the a I'll co-pay in label function to that is our to just actions, net really share thanks speak indication. course, is, reports anecdotal prior very just since of for hasn't Schuyler, patterns exactly insurance about established support I indication to revenue and all plans changes can There discussed we sort all one. I So happen with being we a we've have other new us fact, to authorization is With regard With of have launch. as change. been there of what can we the made of but And added function them. prescription, to tell adverse out for in don't different approval program the elapsed gradually of with view of thousands of It's coverage, indication specific criteria. over and premature been to I our can't anecdotes would your new anecdotes occurred number enough the the gotten have start as think prescribed. sort broad of to something to of time. of months you, we insurance average there. that sensitive regard the before, do the to aware is are following I see result per I'm business -- drug expect indication the authorization new which not a that for questions. current added the We in the second sort as you actions not any prior in expect of a

Schuyler van den Broek

That's And Got helpful. then one it. more.

you On you the think that? talk the sales expansions in I future. what would factors about inform potential force, Can mentioned

Ramy Mahmoud

Yes.

I a promotional it the with initial we're closely producing think we're we generating of best and get the of promotional inform changes timing the activities. the as analytics. we intense looking following uplift ROI, sort fairly and results we'll the sense the then to And of and that better of see to our any activities, are magnitude information drivers make that in use that our we're

Operator

next Our Jefferies. from question Glen Instructions] Santangelo with [Operator comes

Glen Santangelo

put can contracts also into some what that added. expect I we follow take? 'XX be a new -- given the to guess up will amended It thought like terms I sort to lead relatively full revenue you all to it in of you're sounds -- coverage. trying figure you should is us on which, mean to cadence you're payer Can is sense those the start trying terms payer's familiarity this in the acceleration long that said the how with what quick gradually for on give the we're of And indication of to seeing when I'm that the year be with point and I'm and the of in -- payer out side? trying Because going maybe product. to commercial process, time. Ramy, a with was maybe guidance wanted seeing the I I to at infrastructure as context fiscal decision

Ramy Mahmoud

thank but these don't you we might which pace obvious, at the at various are there major insurance made, been Well, PBMs thousands insurance examples been a And for thousands it other made. directly -- the insurers, there there's of the changes This and but and control already made examples changes are where And of concrete hasn't question. plans. where sound Glen, I are number small of have have plans. cases so

So we are of on roll estimating some in one weeks; plans, it that And we the that some to take plans, for some months changes to could things just in have few out. these ourselves. ultimately it's a eye keep an

We the I day, revenue. sort directly think you this We've not give quarter. makes we're difference something that in revenue was done to be we asked it of their would we've to we have the tried clear control. we tried of to aware of changes. you transparent a an indication end insurers new those to And But that make fully start everyone at be that with so increase the guidance And coming. facilitate ability that it's everything in can expecting

$XX we increasing, it which in of So second we're reaching million to for the start higher ultimately expecting to calendar quarter, to remainder than year, $XX revenue and meaningfully XXXX, expect is the million XXXX. over increase

Jonathan Neely

the you think cadence agreements. amendment to so you cadence of it's question I a a our amendment asked Glen, a about the agreements. -- did ask question of of And And about not much

contemplate they indications on label. of are the product I more think contemplate for the reflecting payers expanded and FDA-approved label, reimbursed this rebates that is largely cadence the is whenever contracts of it's the the that a

it's contracting think discussion. don't I -- a it's So

reflect I the think the processes it's state the label, a It's product renegotiation. All processes and reflect of the more that. business having having their right. that insurers not

Glen Santangelo

$XXX script could how like you or in total you for a The million amount you an I'll quick number off. Maybe that were that. then we your comment to and number, that should wondering per of you just on a and number script how on and other behind fair meat that down then of a came sort rev script. rev X sort was me, John, based put that looked about quarter, average peak this can on sales little from secondly, more And per bit and think average Ramy it hop perspective? scripts maybe, ones they I if

Jonathan Neely

Sure.

mean we XXXX some I co-pay quarterly as I reduced we of So in on the portion number prescription. made growing changes of business program our we've and to proportion profitable has a of and of us prescriptions focused early our described, again, believe the in terms think assistance late and has on basis, kind the XXXX, in unprofitable

year-over-year the basis. are I business at the performance think, you're on no a So there you our net if by improve prescriptions, on being result, prescriptions that look revenue importantly, down, almost leaving But year-over-year XX% them longer filled.

So up on coming financial year-over-year terms back a for to what of we're in were basis. here again, performance, revenues XX%

Ramy Mahmoud

even are negative bit little add prescriptions. you a or that number sort to unprofitable in Just to have because comments, of we revenue but reducing it the might of missed the earlier

have have focused profitable we prescriptions. growth -- also on for We

managing we're grow do what terms of trying So total is in prescriptions business, profitable. but to the grow not

it one prescriptions The other varies of closely by new that the that numbers. mirrors reminder, at is over be disproportionately is thing all. things and initiations, But which comments actual sort third-party to new data our co-pay third-party initiations just my is a have I it's been providers may And imperfect. of how $X highlighted mention, earlier of drive captured as a it I'll time were providers in that the launch, imperfect, by the tracking always trying not external new

you. it be to So invisible will

Jonathan Neely

the growth per year one you for the on the implications give guide I'll prescription comment prescription for So and growth. revenue last and

can will, with to are and given along revenue grow prescription, basis of math, on revenue the derive for you a that well I think as basis prescription. we've if prescriptions as I both grow to if provided per revenues year-over-year per you a expecting floor, range a the and revenues a think reverse into on that for we year-over-year you kind

Ramy Mahmoud

not is really is And us from peak the is in to meaningful were X $XXX Glen, net to last average in use revenue increased growth there pull growth add incremental year But of come of the get a growth say, view the in to out will future, uptake product. thing you in I'll the last, It's the growth know, XXXX that There the of the asked so. I product. levers about from million. lot sort prescription. the or primarily don't per of the months My

Operator

question with Matthew comes Wainwright. from Our next H.C. Caufield

Matthew Caufield

And so launch congrats far. successful the on

ENTs, maybe appreciating in efforts, say, prescriptions specialist-focused kind not the the efforts segment targeted just around, could care any how the of presumably, inform sales be be share then the any from the could future that prescribing granularity and number current allergists So primary focus? being that coming plan to coming you primary care towards And could of quarters? do

Ramy Mahmoud

Yes.

we yet we'll a growth. about for how But Matt, as of indicators of on future made said. the haven't So sort decision sort out you report

future, we'll don't right for focused a the inform want anything responsiveness number. be efforts. We now called our promotional to huge the of about I the and are And some not sort nonpersonal near do which do gathering have larger will course, in for expectation be data in prescribing on we'll in at primary in our being specifically efforts and manner care specialty product physicians we audience. different primarily specialty our segments, by on future least... Our which is the the in of efforts, -- audience a is a uptake have used university, But to set that Matt, we reporting promotional use

Matthew Caufield

excited see to Congrats Very the launch Fair and helpful very guys. Okay. enough.

Ramy Mahmoud

again, Matt. Thanks

Operator

time. Ramy remarks. turn no back to like Mahmoud, to CEO, I'm closing would now it I for at this showing questions further

Ramy Mahmoud

hope and to Great. morning. share at company ago. I'd or you for in year help, excitement I you today compared like thank is the joining different a a Yes, to this your our what place I us. attention appreciate all more and

second few accomplished and With to and feel people really August look a previously the financing results. in approval that in back in that we've you to of value and the treatment like alternatives. quarter with better getting no help forward disease new new we to millions our the we to shareholder the last we're with again months, position create And had share much

Operator

conference today's for Thank you concludes This call. participating.

disconnect. now You may

OptiNose (OPTN) 14 May 242024 Q1 Earnings call transcript