ECOR - Earnings call transcript Q2 2021

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Operator

Greetings, and welcome to the electroCore Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rich Cockrell. sir. you, Thank

begin. You may

Rich Cockrell

all for call. you, in participating Thank today's

released Goldberger, Officer; Dr. ended Brian Joining today, Staats, me press Chief June Executive is Dan are electroCore Earlier copy Officer. and today XX, Posner, XXXX. second of website. Chief Financial available Chief on Medical for company's A results the electroCore's the quarter Peter release Officer; the

could All the forward-looking like make based to expectations include financial begin, I'd Reform or undue reliance these of various deemed pursuant to assumptions. involve of within statements without forward-looking the statements. we statements that cause our limitation, you be These made will the safe harbor current place forward-looking of in and including, provisions statements remind not of securities Before not are should and risks by the facts and management federal trends to statements, that Private should estimates our be statements Act actual statements. during operating call Securities XXXX. statements this Litigation historical are laws, are of call meaning the implied forward-looking that examination future you contained Any differ upon uncertainties events materially on company's those or the results statements. that material Accordingly, anticipated from to these which

Dan. that live accurate call predictions you. Securities future filings August or that, the risks events revise XXXX. required associated intention broadcast financial the with contains And turn over only new as as law, with statements, please forward-looking time-sensitive otherwise. Exchange or disclaims uncertainties the of and information, to update a by list of the company's call or the or except This the because descriptions For today, company's I'll business, with Thank Commission. any X, of obligation, see of to conference is any information and whether ElectroCore

Dan Goldberger

I'm than to the And operations million XX% excited XXXX. second QX $X.X thank a XXXX cash us million. expanded in you net of revenue first to to and was $X.X Hello, for today. record quarter million more for that XXXX XX%, joining from of over $X.X quarter have Rich. for the you, everybody. decreased Thank used report margins Gross

compared XXXX, the million of second of in XXXX, $XXX,XXX as For $XXX,XXX quarter for quarter Revenue from the quarter the revenue government second approximately June the ended XX% to the channel of purchased and quarter X,XXX approximately XX, second total and XX% Note products military $X.X VA gammaCore the of to XX and second June increased that there total XX hospitals from increased A in and XXXX. quarter XXXX. $XXX,XXX compared treatment XXXX. clinics. medical of XX, XXXX, DoD of XXX through through have VA military first the facilities of through as to quarter XXXX facilities are healthcare XX

during distributors, Western which quarter These the $XX,XXX have States revenues not include and to ahead contributed XXXX of Canada growth $XXX,XXX second of the Revenue So figures channels the of of appointed us. we stocking $XXX,XXX during still plenty as the to XX% through do outside direct in XXXX. of XXXX. quarter compared Europe quarter increased second from newly of from United second

exclusive moments quarter for gammaCore in China. exclusive XXXX through few the of Qatar. distribution nVNS Agency managers, East agreement including quarter to take benefit to covered opportunity. Sapphire was the our an XXXX, relationships. of a are compared initiatives pharmacy of this Sapphire We serve through gammaCore in currently CVS in that in channel the patients second between as and of serve specific commercial million quarter, headache from ultimately, and expanded depending the approximately and Corporation our XXXX, distributor Express Net a that global patients exclusive drugs revenue as lives Taiwan service $XX,XXX for will International nVNS co-pay June announced the plan. to we not Kromax $XXX,XXX with gammaCore's I'm benefit benefit XX to have Caremark, second the we U.S. availability Scripts, XXXX. month, explain to distributor the April subject $XX announced a In During important the differentiate $XX going company design international In the per that of on These devices. does distribution their as between

a of have patients access that also to paying small gammaCore for number cash are We therapy.

were a for Previously, nerve in are initial or prescriptions Armed our to programs. vagus their promotions. an engaged coverage growth now is in an to of Shield positive determination, list which a More Our we we've faced even of stimulator, unique an coming that our We our business obtain coverage DeShon XXXX these initiatives Mitch additional our HCPCS, and New insurance quest regional to to became with models. Lisa us carefully Jersey, System, coded providers. the more with months. deductible long-standing I in we physicians RN be Level Coding forward fee on X, a initiatives. wins clinical to all his To easy team leader the Procedure cash from their pay our and I'm KXXXX, April Martin, Blue therapy. This the first code point, and small revenue reliable our pay to established our Healthcare company. schedule. leverage consumer Peter? means with help been fill look miscellaneous, effective pay pay provide benefit us in Americans Cross for cash and by made year. Peter to non-invasive is We've XXXX. have unique accelerating milestone from second sales II of initial an and patients amount are when Common led of At half paid experience plans, payer coverage negotiating with Medical insurance of sharing are national cash various quarter this patients we as business Chief Blue testing high Dr. in news ramping BSN, gap, discussions of ask success pilot reporter Officer, that in our going denial likely a important see our May which an cash Highmark joined also had policy with advantage obligation available. models new cash for hope up negotiate programs, insurers. to and benefit support We've Staats, was second customer code, XX gammaCore to taking insurance as direct-to-consumer update

Peter Staats

progress entitled, fronts various announced In nerve of second headache. quarter. This the peer-reviewed vagus of the We've of had non-invasive across our nVNS, Nature a as publication, suggesting treatment an peer-reviewed Thanks, is article nVNS for cluster the April in cluster first-line on trials therapy stimulation Neurology or role a highlighting Dan. publication emerging Reviews this we XXXX, as headache. for

satisfied able The of in supporting of to June, symptoms transcutaneous provides that stimulation India, efficacy safety headache. Nature a migraine. one option in Sapphire biomarkers of using announced under the the in recommended XXXX, of at and and nerve at Medical stress. and study fatigue reduce Journal suffering with on PTH, mild recall publication. Department Calcutta, first-line sleep injury Partner and collaboration Wright-Patterson call for vagus reports entitled or headache other disorders conducted publication post-traumatic Neuroscience evidence accounts Disease. This University Post-traumatic investigator-initiated performance known point, of concussion. may use over in Research paper announced Air approximately United reportedly of June or gammaCore in an preliminary treatment the by increase Parkinson's of a for disease Institute with the company or entitled of Newcastle a Laboratories, England the headache and This non-motor XXXX, effect the or double-blinded, the of of improves also of Affairs gammaCore Force peer-reviewed and Biology, results as items. motor entitled, sham-controlled in treatment our freezing cognitive of Base, was gammaCore disease. the and conducted a or of consequences trial as of Communication Department a relevant published acute most to crossover common review a patients stimulation ability journal trial is a of trial vagus nVNS, of financials nerve the or cluster States both non-invasive all turn the the and deprivation U.S. in of treatment. the for gammaCore X% a U.S. you paper sham-controlled, patients using double-blind, treating the I'll Brian? Parkinson's sponsored the Sapphire. of from NPJ nVNS brain Brian randomized, of for of announced molecular the Science the to nVNS The the In Veterans at Parkinson's in Force symptomatic TBI patients peer-reviewed Nature Cephalalgia In preventive highly May Also self-administer company AFRL. nVNS, treatment the in XXXX, Most traumatic subjects journal, At performance were paper publication for were July headache with a on guidance reports of and the As randomized, in this and treatment the gait Air clinical paper

Brian Posner

Peter. you, Thank

of electroCore get and with adjusted of SG&A Research from to VA, stock $XXX,XXX fees the quarter The for first of profit X% stockholders' extinguishment the net XXXX to quarter expense of charges, in quarter to of securities reported to expense of compared second of XXXX, EBITDA Net carry $X.X release. quarter the loan, administrative primarily net sale XXXX. development June The of the quarter press the forgiveness X% DoD, For million the our of XXXX $XXX,XXX in loss, Total growth XX% in net tax of first ended net in the of other proceeds tax quarter the exclusive the approximately reduction of second GAAP XXXX. first quarter with quarter net cash the a Selling, equivalents marketable EBITDA GAAP previously the been during and revenue as and other the XXXX. the second compared $XXX,XXX as decreased net million the R&D Cash, expenses today's first compared the was in of the of $XXX,XXX the with loss was reconciliation second to a excluding decreased $X.X $X.X the the amortization, totaled $XXX,XXX reduction quarter XXXX. our quarter legal to was expense, benefit a benefit guidance cash at compensation GAAP financial as second and quarter June compared the of approximately the as XX, from $XX.X compared increase quarter XXXX. statement was by NJ loss of during net was million first first This and by approximately driven and to the in to of quarter primarily XX% NOL first $X.X Adjusted XXXX. compared the XXXX loss associated of in cash quarter initiation XXXX second defines second $XX.X increase quarter second as in PPP quarter and XXXX. to XX, due and expense $XX.X for line XXXX. was in loss a where was XXXX, compared approximately quarter X% to $X.X $XXX,XXX was of $XXX,XXX million net restructuring in to of of and R&D shares raised from Kingdom. forward litigation, for the second XXXX, as quarter loss reliably approximately in quarter million the of to used $X.X flat the $X.X and general quarter XXXX. the and offering or sales sale from $X.X included debt and by tax. million net loss sales approximately $X.X and million quarter to company margin million loss and of was in GAAP second net and or of compared in paid, EBITDA March as driven channels of of as Jersey associated $X.X a the non-GAAP for of the as million $X quarter XXXX compared million extinguishment folds. Gross of XXXX. the XXXX, net second million million expense $X.X in of $XXX,XXX during the severance-related company depreciation of the carry $X.X XX, as XXXX United proceeds second NOL June XXXX. of XXXX, million to in XXXX compared A quarter New $X.X we total sequentially. of at of adjusted quarter $X.X quarter million XX,XXX,XXX XX% quarter stock. compared $X.X GAP-PTH income a in provided million, in or XXXX XX, in of a in were the XXXX income through GAAP debt, stated XXXX, compared of from million, common XXXX second program. XXXX, loss from of its $XXX,XXX net was XX% XX, change Subsequent million of Gross was $X.X expense June million in the XXXX public in GAAP to of quarter has in in ended or million of operating second approximately loss by expense, million of of $X.X the first the million second of of of second sequential tables first XX%

to XXXX, renewal back in over be approximate insurance Looking to And usage largely due call increase of The least $X.X the to $X.X revenue we net activities, of expected of quarter for annual cash usage, I'll and third exclusive million at turn Dan. expect cash net our financing ahead, million. policies. to the now is the net

Dan Goldberger

United dedicated further the Staats cluster pro during results our year of forward $XX.X cash conjunction third as XXXX. these to performance continues Brian. look a thank our I publication term, clinical to VA, channel Thank and in XX, We ongoing support June that strong out discussed with of the with loyal GBP We're XXX for standard-of-care of to and nVNS look could gammaCore greatly our position a used their patient in Kingdom reiterating forma We're pleased quarter patience through staff quarter. balance supporting their and is improving negotiations. penetrating by when supported financial of expand of versus benefit commitment - professionals The forward the you, year. the first market per the for this for and our provides therapy. times clinical a further headache with in and payer gammaCore migraine want evidence therapy to Longer business the the DoD recent Dr. Mandate in pharmacoeconomics Funding developments therapy. beyond as trying healthcare and the rolling the growth MedTech million support recognize our their work indications

Staats and open to for Finally, of ask at of announced Lifetime the point, July I this Neuroscience Award annual At the XXXX. congratulate on Pain the Society American I'll want our questions. Achievement meeting Dr. operator the his to in line Peter

Operator

you. [Operator the coming Cohen Thalmann. Jeffrey, Thank is is line question And from live. from first Instructions] Jeffrey your Ladenburg

Jeffrey Cohen

you? Dan, Brian, How are Hi, Peter. and

Dan Goldberger

Good. you. opportunity, Thanks Jeff. Thank for the

Jeffrey Cohen

a our end. few So from

of addition familiar the the the currently in the you through else us walk the months? Dan Where setting outside going eventual on Taiwan over and I coming be heard U.S. what's with expect pretty I'm are geographical now to So and UK.

Dan Goldberger

ultimately now is of some announced several in look distribution Kromax the Mandate. more transitioned Taiwan, more Europe, we the also that a United traditional parts Canada, distributor for in which few the in recently going the We're distribution most and China. Funding MedTech other in starting think in in a got to in arrangements stocking So to we know first East. year, to what Kingdom, we've will based recently, growing Jeff, this more and and business to is wholly-owned Qatar, United explore relationships in continue Kingdom. channels earlier in be nicely, Middle pharmacy Australia of the And Europe. as We have We're that arrangements you subsidiary in

markets We also get for may wins, we we countries one a and healthcare Europe, reimbursement target - to choose at in time. those coverage in opposed in national those initiatives a do if as have few go we specific may to but distributor, direct thing

Jeffrey Cohen

as and you play folks Got how money about other walk Perfect. us what you here. talk through some could about DTC? it. of And that flow, could you mentioned DTC I Mitch Could out mean that could So channel? know little talk far the logistically the a and - as maybe

Dan Goldberger

Yeah.

think to the headache covered of in our for to insurance opportunities pay be payers -- be going we work establish to a to with where We're commercial the the channel. larger going going that's cash patient So directly their is continue that, the works business that of And really develop reimbursement meantime, company. for initiative with to future these number lives.

of healthcare goes in You've a this apnea. therapy therapy and on seen model home oxygen similar to diabetes sleep -- in variety for what in supplemental devices sleep

so offering develop opportunity very competitive coverage path in options continuing we're of a the cash more background. pay in terms traditional following to And insurance while well-worn a

Jeffrey Cohen

Anything out over podiums, FDA for through then presentations, for Peter, us, Got it. should may stretch when head our lastly us trials timelines for? we initiated, we watch Investor new that specific Day 'XX? year walk this see balance of that And on or the some matter, or and

Peter Staats

that that, will and Yes. issues be one in the International we at going studies, the I completion presented of mean, coming next XXXX. year. the be Stroke are the announced of Conference We've anticipate hopefully to that think big and I stroke submitted

published much will out not XXXX other the are areas as the has many more in this I've the out. of been for and came that year, with coming But as I'm one trying meetings. interesting the upcoming issues, lot through presentations too be and on XXXX. out of mentioned in remainder don't see coming Parkinson's think data to I think There's coming a various I

Jeffrey Cohen

Got it.

Okay, perfect. That jump back it does Thank selves. queue. you. our I'll in

Operator

And is H.C. next you. coming from Wainwright. [ph] the RK Thank question from

Unidentified Analyst

and all, Brian. Thank afternoon, Peter you. Dan, Good

the So started growth that the in second in the in looking quarter, clinics drivers gammaCore. of at terms of VA have more are we sales, this - some prescribing

to compared think You the first say of, the I previous number XX quarter. XX it's in it's

are how much extent of and VA much is this the repeat and COVID-XX of is opening I back some how And So the this obviously, coming - centers? into - - states, what the customers is half in the beyond? but - you in certain and the the continue what of this it's of XX into mean, to from the opening country XX, rest growth - been terms sense has to up, that do of to expect second

Dan Goldberger

Yeah.

customers, And are hospital ways But we up surface. both. very facilities, new to our variant. the open some other nice There existing of may hospital lots noise, is hospital the XX compared about three of you customers, XXX So start grow But quarter, have customers, and as and to traction, new the quarter, current more is customer second ended just hospital we mentioned, from in able in excited receded really new saw, the importantly, you of two as in we the go X,XXX generate as than June of back customers. and up additional the great those doing to headwind to pandemic field, the less year. the still and up open in them into scratching deeper the as RK. months we're get tell. we're to and question, really Out being early VA too to initiatives most Delta to both saw lots One prescriptions to the be a opened about in hospitals. previous existing customers business X being we're an growth than That

pandemic lots room selling. as to for back and we So recedes, the then growth of get upside

Unidentified Analyst

X April achieved 'XX with in the discussions from think payers, Okay. see code? event? some in you what some months And on been you had have you're having the it since Code few that of 'XX terms has the of a that more would received and or the And growth is of you HCPCS that do last

Dan Goldberger

Yeah.

favorable fee Highmark more it's So Cross event. with Blue negotiating And Blue was determination. them. a now coverage a of 'XX first we're schedule Shield our

see more a obvious half We announce in Crosses, insurance going able we'll the XXXX, have players, more more - be is conversations but the over reimbursement kicking few players, we year. of the the of national with of including likely the work We this course on to year. but these that Kaiser, get the in, do really this back in regional smaller few we'll a Blue leg to have

Unidentified Analyst

Okay.

one So question last for Brian.

OpEx, of these operating expenses you the reached [ph] obviously, it in to operations. with amount compared that X% On or of system? still VA you can hospitals opening as efficiency more up And you've and from out there do some efficiency growth get bring by can down think the brought efficiency up. the you been much the of the see you is quarter the as to Do able of still going potentially of first lines you to some some you think sales

Brian Posner

another good RK, question. Hi,

But and our we're help looking to but I cut sheet balance focus looking is again, costs, think where being growing the think top costs always appropriate. to make ways on appropriate generate potentially cut I the ways line there's for that to now, strong. always growth. investments We're right the to with targeted

Unidentified Analyst

gentlemen Thank taking questions. for you, you. the Thank

Dan Goldberger

Thanks, RK.

Brian Posner

RK. Thanks,

Operator

your from you. is John, from John line SCR. Zacks the Vandermosten question is live. Thank And next coming

John Vandermosten

that excited a had recently. great I the way of they have. opportunity out distributor that most Hey. good or broader like Kromax near pursuing you what get you the was obviously, that it announced term? to the agreements is. in is can How I process? Taiwan there to only arrangement and headache go about a will regulatory lot that really take and than mean, that guys Good Gosh, morning, just seems or long is there, be don’t know China time until afternoon. We're And it through a expected

Dan Goldberger

Yeah.

airway for So covered longer that's we United that list a nerve - now. process is what explicitly reactive of CE-mark disease have unfortunately. is we and a prevention future it bronchospasm. the CE-mark just stimulation with aren't showing a vagus process. mimic which on headache outside the But the States, quite is through indications bureaucratic, Taiwan requests Really, list and epilepsy non-invasive international treatments long by have right be the cluster We're FDA-cleared the on system. indications and and in of our good point, could the a are and of much include John. dealing good migraine. Generally regulatory United document I distributors States. and in exactly In the but paperwork depression The our timing the don't intensive US, pretty what CE-mark, visibility

more So a I'll know in few days.

John Vandermosten

Taiwan, And Great. is world, the China. populations I is largest smaller. lot obviously, access the think, that a in the to Okay.

do a XX on little get rank terms I higher XX mean, I economic penetration population? there, like think just material that what out And think it of arrangement these, status. another the bit mean, perhaps a you I million, wages do in But I kind one, guess, million, these bit can How higher Western into the there something you you areas? this is is have of... you most Or based that. little Europe?

Dan Goldberger

Yeah.

of calendar a a that quite if just issues, class has Asia going And therapies. through opportunity. we time. bit get middle larger larger then That's can the can regulatory afford of a obviously, take to term, long these So is kinds

more for while is I 'XX East think Middle even into will long-term 'XX, be contribution, big a win revenue and and Asia probably Europe substantial us. the

John Vandermosten

Okay.

what, they saw announced, the are soon? mean Okay. that geographies to anticipation that that stocking just clearance that Does I'm of they market to happening in there. have And $XX,XXX that you just RSK assuming in the up sales Silver was on based I and And distributors. Medical or

Dan Goldberger

gets through clearance. and and the obviously, clearance, Europe, Canada clearance So CE-mark regulatory have Australia

John Vandermosten

Okay.

me - sales can short-term, already emerge those on are So in they're question last may then is they the - opportunities. great. that for just the And very

and there. I - with have would mean alter two three of recently You these? just of that run XX want more capital recent study, It balance I out there's pursue them. or so keep some mean, could like in or XX you many something with just because many. ones deprivation now, the that the Is raise, may tracking and the a you you that cash that to like sleep more. announced always you're there's you now little seems best can't some does more you opportunities bit sheet? take have And

Dan Goldberger

Dr. concussion. opioid disorder, the U.K. Chapman sequencing, the it, headache to think associated I been brain the traumatic or And and published alluded headache traumatic - that secondary use and Dr. sequencing work around brain that is in in injury Peter a PTSD some Parkinson's. of but The with work the sorry, has Bremer on doing

closer are us indications. that for opportunities expanded to the think I get those in

John Vandermosten

Okay. Thank you, Dan.

Peter Staats

seeing in in work my and If biomarkers, of add with entire really stimulation. there. it's adding, Dr. the in in some Parkinson's non-invasive you're little of one Mondal course, vagus really things I just significant are some nerve changes There's validity comment work, there's, work the Chapman, the could that mind, ileus But Parkinson's. to interesting the which field the of

that dominance the So hope and the that be papers earlier, those palpable pair on for that our cost is therapies we to will are for going coming forward. a types therapy momentum of activities that there rest, cluster alluded for I when out first-line we with headache

Operator

And Maxim. the from coming question [Operator Jeremy Instructions] from Jeremy, next Pearlman live. is your is line

Unidentified Analyst

behalf How you guys - doing? Anthony Hi, of thanks. Vendetti. I'm on actually I'm calling

Dan Goldberger

Good. Thank you…

Unidentified Analyst

ones. year-over-year on quick so I just normal you the variant more any open two your usual? have is know of are as QX possible? you an is or Delta where Is through I Or us? VA is vaccination there revenue, sales halfway especially guided any in there much is, high most parts Or So my reps to give are traction, sequentially questions seeing country the you're can answered increase of is, as rates? unfortunately, headwinds One as towards gaining we're visibility such hospitals, no everything the now. there's

Dan Goldberger

the to we the take using as the But - are The Yeah. variant. affect a don't I daily effect insurance dramatic when on Delta sales we're companies insurance monitor, based talk don't make excuse the are VA appointments it I - appointments about insurance being in don't and are from efforts, to another go channel. our what We're clinicians we that to don't seeing we yet held. very doing reimbursements, companies, open-minded in companies -- see not though, meetings. dashboard not

So that rather get this life to than fingers crossed a normal we and passes back later. sooner

Unidentified Analyst

one then one And bigger plates gammaCore just have Okay. is a a of. talked and picture of it lot to when the question. spinning studies capable We -- comes a you lot more, what -

when would could there XXXX, is another for of on possible be? some clarity if any, submission XXX(k) that Just the and clearance another what more maybe, indication timeline we expect, and it's

Dan Goldberger

Yeah. We specifically expanded indications. haven't given any guidance on

You're anything likely to regulatory publication approvals. about see we before a clinical say

Unidentified Analyst

That’s you much. all so All Okay. have. right. Thank I

Operator

the Dan questions will that's I any Goldberger for we closing to it had. now And hand you. Thank all back remarks.

Dan Goldberger

Good better your appreciate look for things And joining greatly time and you in our operator. future. Thank night. forward call. thank all the We attention. to And you,

Operator

and conclude you. today's Thank call. gentlemen, this Ladies conference does

this at your for may lines wonderful you a day. time. your phone You disconnect Have Thank participation.

electroCore (ECOR) 8 Aug 212021 Q2 Earnings call transcript