Senseonics Holdings, Inc.

Q4 2021 Earnings Conference Call

3/1/2022

spk08: Good day and welcome to the Senseonics fourth quarter and full year 2021 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Philip Taylor, Investor Relations. Please go ahead.
spk05: Thank you. This is Philip Taylor from the Gilmartin Group. Before we begin today, let me remind you that the company's remarks include forward-looking statements. These statements reflect management's expectations about future events, operating plans, regulatory matters, product enhancements, company performance, and other matters. and speak only as of the date hereof. These forward-looking statements involve a number of risks and uncertainties. A list of the factors that could cause actual results to be materially different from those expressed or implied by any of these forward-looking statements is detailed under risk factors and elsewhere in our annual report on Form 10-K for the year ended December 31st, 2021, our 10-Q for the quarter ended September 30th, 2021, and other reports filed with the SEC. These documents are available in the investor relations section of our website at www.censionix.com. We undertake no obligation to update publicly or revise these forward-looking statements for any reason except as required by law. Also, on this call, we will be discussing our 2022 outlook. Joining me from Censionix are Tim Goodenough, President and Chief Executive Officer, and Nick Tressler, Chief Financial Officer. With that, I'd like to turn the call over to Tim Goodenough, President and CEO. Tim?
spk02: Thank you, Trev, and thank you all for joining us this afternoon. On the call today, we'll provide an update on our launch plans and collaboration with Essentia for the recently approved Eversense E3 CGM system. We'll discuss strategic updates in Europe, and we'll touch on our product pipeline. Nick will discuss the fourth quarter financials in detail, and then we'll open up the call for questions. To start off, last month we announced a major milestone for Sensionics, achieving FDA approval of the Eversense E3 continuous glucose monitoring system. This is the third-generation product approved for Sensionics and speaks volumes about the leading scientific and technical pedigree of the company. We are very proud to extend extend the duration of the longest lasting CGM system to six months in the United States. Not only is this the longest lasting CGM by over 12-fold, but it also offers patients top-tier glucose measurement accuracy with a MARD of 8.5%. I'd like to thank our team, the PROMIS study investigators and study participants, and the diligent professionals at the FDA managing through the demands of the pandemic all of whom helped us achieve this milestone. This is a major advancement for patients who continue to seek alternatives to the short-term transcutaneous sensors and for the limited choices that exist in the market today. Six months of wear, just two insertion procedures per year, makes E3 even simpler, more convenient, and less expensive for patients. From our market feedback, it is clear that users have profound interest in a CGM that lasts for six months. We believe each sensor wear duration advancement represents a stepwise market penetration and market expansion opportunity. Later in the call, we'll touch on the commercial launch plans we've been developing in collaboration with Essentia. Before we look ahead, I'd like to recap the successes that we had in 2021. Through significant collaboration, we have transitioned global commercial operations to Essentia diabetes care, both in the U.S. and in Europe. For patients and providers, we continue to expand access to Eversense through positive commercial and Medicare coverage policies. Awareness of Eversense continues to grow through patient advocacy and direct-to-consumer digital marketing campaigns. Essentia is establishing its field sales and clinical teams, marketing channels, and a distribution network, and has more recently been building dedicated CGM-specific expertise in preparation for the E3 launch. They are re-engaging healthcare professionals with Eversense, who we believe are excited to have another solution backed by robust clinical evidence to help patients better manage their diabetes. On the insurance coverage side, we were able to add a number of additional payers covering Eversense, including Medicare, as previously reported, and more recently, over 8 million additional covered lives with positive coverage decisions from payers such as Blue Cross Blue Shield of Michigan, Medical Mutual of Ohio, and CareSource, now all covering ever since. On the financial front, we were able to raise capital to support our ongoing business initiatives with an emphasis on our product development programs. All considered, we have laid a solid foundation to reach the support for more patients and to advance our technology. For revenue, in the fourth quarter, Senseonics generated $4 million, which included $700,000 from the U.S., and 3.3 million from outside the United States. We understand that from our users, the satisfaction with the Eversense technology remains strong, but the user base was affected by our prior withdrawal from the U.S. sales and marketing efforts, the COVID-19 pandemic, and by the transition of our distribution partner. The learnings from these factors have informed Essentia's commercial planning, and they are working hard to be prepared to launch the E3 system in the U.S. in the coming week. As our commercialization partner, Ascensi's key focus in our collaboration is to increase the rate of patient adoption of Eversense. Over the past year, they have been working to gain greater experience in the CGM market and optimize their sales strategy. This has resulted in a newly dedicated CGM commercial organization. Rather than sharing resources and focus with the BGM business, Ascensi is now establishing dedicated marketing and sales functions for CGM. This team is being designed to provide the infrastructure for high patient engagement, determined interaction, and the experience required to deliver the full potential and value of E3 to our users. We are pleased to see this focused commitment to the Eversense product. In the coming quarters, ADC will be primarily focused on transitioning current patients to the E3 system, as well as expanding the new patient and clinician adoption and ensuring continued patient access through the transition from 90-day to six-month insurance coverage. Significant investments are being made across each category to support programs targeted in these initiatives. We're excited about the E3 commercial launch in the U.S., and it's now approaching. It is scheduled for the beginning of April, which includes product availability and broader marketing efforts. To prepare for launch, Senseonics is ramping manufacturing, implementing product packaging according to the received FDA labeling, and preparing to ship product into the distribution channel. Ascensia has been focused on distributor negotiations, Salesforce training to our new label, and preliminary conversations with HCPs to coordinate formal product introductions, as they also continue to build their dedicated CGM team. Right now, in preparation for April, we are leveraging the momentum created by the E3 announcement to prepare the market for launch. A key element of the strategy is to increase Eversense awareness via a direct-to-consumer digital advertising campaign, leveraging population algorithms targeting the diabetes community through Facebook and other social media platforms. We believe that the leads that were generated in 2021 demonstrate the potential to make an even bigger impact in 2022 with the E3 product. Ascensia has plans to ramp up the campaign meaningfully upon our April launch. Diabetes professionals and healthcare providers are also a target audience for specialized marketing. Investments are being made to increase engagements with this group at diabetes trade shows and medical meetings. We expect a patient pull from our DTC marketing will encourage increased engagement with existing providers and for those who are new to Eversense. ADC will initially prioritize resources to penetrate the market in geographies with the highest insulin prescription concentrations where coverage for Eversense currently exists and where there are active inserters. On the patient access front, ADC is driving with the goal that every patient with coverage for Eversense will receive E3 when they are due for a new sensor starting in April. We are planning for a rapid transition to the new longer-life six-month product. With the launch of E3, we plan to bolster the patient assistance program to offer E3 to any patient with commercial insurance coverage for a $99 out-of-pocket maximum for their first E3 sensor. That means six months of CGM for no more than $99. We see this as an incredibly attractive program to try ever since. This is a significant investment to drive adoption and initiate product familiarity. With our expectations, this program can drive increases in the user base as a result of putting both new patients on the product and converting users from other CGM systems. Following a patient's first E3 sensor, the program is designed to provide ongoing assistance capping a patient's out-of-pocket on a monthly basis. Additionally, Essentia plans to provide co-pay smoothing options, allowing patients to pay their out-of-pocket on a monthly basis rather than all up front. And to further ease HCP access, we have initiated a pilot consignment program. This program reduces the acquisition barriers for HCP offices by limiting their initial costs to carry systems prior to their Medicare reimbursement. On the back end, transitioning payer coverage policies from 90 days to six months is a process we anticipate will run through the coming quarters. We expect the transition to be fairly seamless with some payers and be more intensive with others as they require updates to their systems. Conversations have begun with commercial payers as well as with Medicare to expedite this transition where possible. In Europe, ADC is making important adjustments to optimize their CGM business. They are working on taking the learnings from 2021 to inform changes and updates in the European markets and drive growth in the patient-installed base, particularly in our largest markets of Germany and Italy, where they see potential for EverSense's channeled delivery and competitive tender preparations improve as ADC designates resources to provide a higher touch patient experience. In Germany, Essentia is implementing this patient-centric product delivery strategy provide users and HCPs with improved product experience. They are transitioning from an indirect distribution model and increasing their dedicated Eversense resources. They have already implemented Eversense internal sales specialists to support patients from prescription to insertion and have begun to provide patient training. This offers greater sales process control for Essentia with our CGM. Regarding the product pipeline, where we continue to make strides to advance CGM innovation, The E3 system is currently under review by our notified body in the EU to achieve a CE mark. This evaluation is progressing and we are hopeful to launch this system in Europe in the third quarter of this year. We would enable the latest generation to be available globally, which would allow us to turn to greater realization of manufacturing and operational efficiencies and to bring our product with lower calibration requirements to the users in Europe. In our research and development efforts, we have shifted our focus to the advancement of our one-year sensor. Recent pilot studies have provided valuable information that we continue to incorporate into the technology design. We look forward to sharing some of these results at the upcoming ADA meeting in June. We are progressing with the sensor design and continue to plan to submit for IDE approval from the FDA in the second quarter, which would enable the start of a pivotal trial in the second half of this year. Our current plan is that once this one-year sensor study is approved, we will focus on submitting the ICGM designation for E3. We are excited about the potential for patients to be able to integrate our lifelong Eversense with the wider variety of delivery devices that are available. In addition to the advances in the sensor longevity, we're making improvements in the interoperability and remote patient monitoring for Eversense. We are working with several partners in the diabetes space to provide real-time CGM data to the connected apps through both the Eversense Cloud and directly from our transmitter. And we'll also be providing the CGM data through Apple and Samsung Health. And now I'll turn the call over to Nick to go over the details of our fourth quarter financials.
spk04: Thank you, Tim, and good afternoon, everyone. In the fourth quarter of 2021, total net revenue was $4 million compared to $3.9 million in the prior year period. U.S. revenue for the fourth quarter was $700,000 and revenue outside the U.S. was $3.3 million. Gross loss in Q4 2021 was $0.5 million, a decrease of $3.1 million from a gross profit of $2.6 million in the prior year period. The decrease in gross profit was predominantly related to the increase in cost of goods sold due to the sale of previously written-off material in 2020. Fourth quarter 2021 selling, general, and administrative expenses were $5.8 million, a decrease of $2.4 million compared to $8.2 million in the prior year period. The decrease was primarily the result of a decline in salary and personnel costs from the reduction in sales support due to the transition to Essentia for the commercialization of Eversense. Research and development expenses in Q4 2021 were $7.7 million, an increase of $3 million compared to $4.7 million in the prior year period. The increase was primarily due to the expansion of our R&D headcount, an increase in clinical studies, lab supplies, and an increase in outside expenses to further advance our product pipeline. For the three months ended December 31, 2021, operating loss was 13.9 million compared to 10.3 million loss in the fourth quarter of 2020. The decline in the company's share price at the end of the fourth quarter as compared to the company's share price at the end of the third quarter of 2021 led to a significant non-cash gains in Q4. As a result, total other income increased by 189.7 million compared to the prior year period, primarily related to non-cash charges resulting from the accounting for embedded derivatives and fair value adjustments related to the company's financings, including the 2023 and 2025 notes, along with the PHC 2024 notes and energy capital equity line of credit. As required by U.S. Generally Accepted Accounting Principles, or GAAP, we mark the value of these instruments to market for each reporting period and the change in these values are recorded as non-cash charges to the income statement. Each quarter, the value of these non-cash gains or losses will vary based on the volatility in the company's share price. So generally, as share price increases, we incur a non-cash loss, and as share price decreases, we recognize a non-cash gain. For the three months ended December 31st, 2021, total net income was $84.4 million, or 19 cents per share compared to a net loss of 101.6 million or 41 cents per share in the fourth quarter of 2020. Net income increased by 186.1 million due to the accounting for embedded derivatives and fair value adjustments previously mentioned partially offset by a 3.7 million increase in loss from operations. For full year 2021, our net cash used in operating activities was approximately $56.1 million below our full year 2021 guidance provided at the beginning of the year. Cash flow from financing activities for the year was $220.1 million, of which $5.3 million of cash outflow was related to employee tax liabilities for Restricted Stock Units, or RSUs. In 2022, RSUs that have vested thus far have been transitioned to a sell-to-cover for employee tax liabilities, saving the company the related cash outflow. The executed sell-to-cover taxes transactions were prearranged and automatically executed to uncover employee tax obligations that arise upon the vesting of grants, which are generally tied to tenure or other milestones, such as the FDA approval of the E3 product in the U.S. As of December 31, 2021, cash equivalents, short and long-term investments totaled $181.8 million. Considering our current patient install base, the E3 launch timing, current product inventory forecasted to meet our Q1 demand, and the transition of payer coverage policies to accommodate six-month reimbursement in the U.S., we expect our full-year 2022 global net revenue to be in the range of $14 million to $18 million. As Tim mentioned, the first quarter will be a transition period in the US as we shift entirely to the Eversense E3 system, which is expected to launch in the second quarter. Given current inventory in the channel, we expect first quarter 2022 revenue to be well below fourth quarter 2021 revenue. Additionally, four-year 2022 revenue is expected to be significantly weighted towards the back half a year with the second half accounting for approximately 75% of total revenue. And for the full year, OUS revenue is expected to be greater than U.S. revenue, with OUS revenue accounting for approximately 55% of total revenue in the year. As transition of payer coverage policies occur from the 90-day to the six-month product, we expect gross margins to approach break-even in the fourth quarter. For four-year 2022, net cash used in operations is projected to be in the range of $65 to $70 million. We expect the majority of expenses in 2022 to be for research and development for ongoing feasibility and pivotal clinical trials for additional products in our pipeline, including the start of the one-year pivotal trial subject to IDE approval. With that, I will turn the call back to Tim.
spk02: Thank you, Nick. As we transition into 2022, we are excited for the E3 commercial rollout in the U.S. during the second quarter and the expected later launch in Europe later this year. This next generation of product is an exciting advancement in diabetes management. Our patients and providers have been waiting for such a product, and we are eager now to bring them the benefits of the world's longest-lasting CGM system. Ascensia is steadfast in their commitment to CGM and the Eversense product, investing millions to drive awareness and access for the product this year, along with launching a new dedicated CGM commercial organization and building a dedicated sales force in the U.S. This investment is ramping meaningfully and demonstrates their continued support to our partnership and the product. Before we open up the call for questions, I'd like to take this opportunity to thank Mirasol Penlilio, our Vice President and General Manager of Global Commercial Operations, for her over seven years of establishing and leading the growth of Eversense, and her commitment throughout her career of improving the lives of people with diabetes. I and the whole Synthionics team wish her the best in her retirement. Thank you for your time today. Also joining us for questions is Mukul Jain, our Chief Operating Officer, Operator, let's open up the call for questions.
spk08: Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. Our first question comes from Chris Pasquale with Guggenheim. Please go ahead.
spk06: Thanks. So, you know, the revenue guidance, you know, which you guys laid out at the time of the approval announcement was certainly a little bit surprising relative to where consensus was. But you guys just walked through a lot of the moving pieces that you're dealing with this year between the transition to the 180-day sensor inventory drawdown, the patient assistance program, So it would be helpful to understand some of the underlying assumptions behind the guidance. And if you can, give us a sense for, you know, where do you expect to be at the end of the year in terms of the number of patients who are on a sensor? What percentage of patients in the U.S. do you expect are going to need to take advantage of that patient assistance program? Just anything around those assumptions would be helpful.
spk02: Sure. Thanks, Chris. Well, we're certainly – You know, we're certainly excited to be where we are, you know, on the cusp of launching this great new product for a very exciting time. With that said, you know, we certainly would like to be further. We recognize that the impact that COVID had on the organization, as well as the delay from the U.S. approval also related to COVID with the FDA, certainly has impacted, you know, the rollout and progression here in the United States. But we do believe that we have all the pieces in place with Essentia, their commitment to the space, and the programs that we've talked about we think are going to be very, very meaningful. We're not going to speak to patient count, as there still do continue to be a lot of moving pieces associated with it. But as you've heard, we do start with a basis of about a little bit over 2,500 patients in Europe that continue to be on the products. and a little bit over 600 here in the United States. You will recall that the previous efforts, we put about 4,000 patients on the product in a full year. I don't anticipate in this partial year we'd be able to approach that, but we certainly are looking to drive as many new folks on the product as obviously we can get access to and have industry in. We do expect there to be reasonable use of the assistance program, as is typical, especially early in the year when deductibles haven't been met. But at the same time, the attractive thing about having a 180-day product is once the patients do come on, even with some financial support up front, we're able to make to them and they are able to make to us a pretty significant commitment. So six months of using the product you know, without turnover opportunities. So we believe that they're going to get a lot of value out of that. So as Nick said, we do expect that a little bit more than half will still be coming from Europe, but that does indicate that there's pretty good U.S. growth behind it, which of course is a very important market for us. And also, as Nick said, the majority of the revenue is coming later in the year, really driven by this transition in Q1 where we essentially draw down all of the 90-day inventory in the U.S. and really start clean here on April 1st with 180-day products. So I hope that helps.
spk06: Yeah, that is helpful. And I just want to follow up on that last point you made because the back half weighting and the weighting towards international, is there any risk of disruption internationally? Let's say you do get the C mark and you're in a position to launch that product. in the third quarter, is there the potential that you could see a drawdown of inventory of the old sensor or the need to book contra revenue for inventory that's no longer going to be sold that could end up actually hurting the international business later in the year the same way the U.S. business is being held back early in the year?
spk02: Yeah, we're going to work to very much minimize that. The timing is being monitored very closely. As you'll note, especially here in the first quarter. We are being very judicious with the amount of product that we put into the channel to really minimize the likelihood that that should happen. In Europe, they are on the 182-time-a-day calibration product. We'll transition them to the one-time-a-day calibration, and it's our expectation we can manage that quite tightly, and it's certainly a shared objective between the two organizations.
spk06: Great, thanks.
spk08: Our next question comes from Marie Thibault with BTIG. Please go ahead.
spk09: Hi, good evening, and thanks for taking the questions. I wanted to follow up here on the question around kind of patient volumes. I understand you can't give us some, you know, sort of what you're thinking of expectations to end the year, but I did want to try to understand the recent fall off a little bit better. Understand, obviously, COVID and some of the transitions have been an overhang, but how recent with some of that fall off. I'm just kind of trying to get at the question of how easily won back some of these patients and prescribers might be.
spk02: Sure. You know, in all candor, the biggest impact of the organization was when we pulled the ability to fund the commercial organization at Synthionics. So much of that loss really happened in the in the late 2020 time period and certainly built into the start of 2021. The continued dynamics with COVID certainly contributed to that. So there was a, you know, a pretty significant contribution to that pullback in all of 2021.
spk09: Okay, fair enough. Thank you for that. And I did want to also understand, you know, you called out the $8 million. additional lives, covered lives, that win. Where are we in terms of total covered lives, I guess, for the 90-day product? Just trying to understand what kind of the starting base is as we head into this payer transition for the 180-day.
spk02: Sure. We're still counting about 210 million covered lives. Obviously, the 365-day product is important for us, and the IDE approval will include the the pediatric population in the clinical testing, so that's obviously a big piece. And then in addition, we still continue to work with Anthem and United that still hold the E&I on ever since. And we're certainly hopeful that the 180-day product will help move that forward with them.
spk09: Okay, last very brief one, and thank you for that, Tim. On the MDR process in Europe, is that adding any extra complexity? What are you hearing from your notified body or what gives you confidence in the 3Q timeline? And thanks again for taking the questions.
spk02: Yeah, it is a very good question. Yes, there absolutely is impact in the transition to MDR. We have been in it quite some time. There have been much more extensive reviews than would have been typical without this new regulation. We are in pretty constant conversation with our notified body, and just given where we are and the amount of material that was submitted and the review cycles, we do feel that we're at the point that we can forecast this Q3 time period for us to be running with it.
spk09: Thank you again.
spk08: Our next question comes from Matthew Blackman with Stifel. Please go ahead.
spk03: Hi, this is Colin on for Matt. Congratulations on the recent E3 approval. I just had a question around the reimbursement progress you've made. You mentioned Blue Cross Blue Shield and a couple other payers and expanding to 8 million covered lives. I was wondering how has the progress gone really with the main holdouts at this time, and what kind of time frame are you thinking for reaching the higher number of covered lives, whatever that may be?
spk02: Well, certainly the biggest one that's frankly in our control and right in front of us is the pediatric indication, so we will begin that testing here in the second half of the year. That's, of course, an important constituency for people with diabetes, so it's high on our priority list, and the one-year product is a great time for us to do that. The two remaining are two of the largest, unfortunately, but as has been typical, especially in the space with diabetes technology, they tend to be much later in the approval process because of their size. So, you know, we certainly would have hoped that we would have gotten coverage. I don't know if COVID has impacted that, but I do think with a more, you know, longer duration, more compelling product that, you know, there's going to be a lot more push from there. from their users to push for it. So, you know, I certainly hope that in, you know, later this year, next year, we'd be looking at a point where they'd be strongly considering coverage of the product.
spk03: Thanks. And I have a couple on the pilot at-home insertion program. How has the reception been so far for that pilot? And what should we be expecting in 2022 for the expansion beyond the initial limited geographies? And will it have a visible effect on the reimbursement profile of E3 this year?
spk02: We're certainly excited about it. I'm not ready to speak to a larger rollout at this point because it still is, you know, it's still in a test configuration, if you will, in the Houston area. But it's, you know, it's a compelling opportunity and one that we have certainly talked about, you know, in micro sites pushing out to larger geographies. The way that it works is there is a mobile – Typically it's a nurse, an NP that will come to visit people at their house and actually do the insertions and removals. So it's got a great user benefit, but obviously we want to make sure that we keep it, you know, we learn everything from the early startup and make sure that the process is going swimmingly for everybody before we expand it. So a little bit too early for us to make broad conclusions, but we're excited as is one more opportunity to look at for new insertion approaches.
spk03: Thanks. Appreciate the questions.
spk08: Our next question comes from Alex Nowak with Craig Hallam Capital Group. Please go ahead.
spk01: Hey, everyone. This is Trent on for Alex. I wanted to dive a little deeper into the guidance here. How does the change in guidance for 2022 modify the ramp into 2023 and 2024 that was provided on the Essentia call or partnership call in 2020?
spk02: I don't think we're in a position to answer that here, Trent. That was done coming up on two years ago at this point. We did anticipate that we would have had the review with the agency last April. I would anticipate, it's our expectation, obviously, that, you know, much of the focus is going to be in the U.S., and the commercial activities will focus on that. You know, it continues to be a very exciting space that we're in, and there is a lot of interest in the 188 products. So we're encouraged by the ramp future, but I don't want to rely on something that was done, you know, pre-COVID at this point and pre the COVID impact on the FDA approval to look in the future here on this call.
spk01: Got it. That makes sense. I could ask another one here. With Libre 3 and Dexcom G7 coming to market, how do you see ever since being positioned and how will adoption be different this time than when 180 Day in Europe was fighting the G6?
spk02: So as I'm sure you're fully aware, you know, the market dynamics are different. It's predominantly Libre and much more predominantly Libre in Europe. You know, obviously when the full function CGM comes, that's going to have an impact, I expect. There will be more, you know, noise and activity in the transcutaneous sensors as they compete for a position. You know, at the end of the day, it's the patients that win. as the technologies get more mature and more flexibility and more capability. And what that does is it brings more and more people to the CGM testing family, which is a big opportunity for Eversense. We still continue to be the only implantable. Obviously, not only the only implantable that's commercial, but certainly with the U.S. approval. So we feel that we have a pretty good lead in that segment, and that as our duration expands, as I said earlier, that really drives greater and greater interest in participation. So, at the end of the day, more interest is a bigger pool, and we certainly are going to continue to drive for our fair share of that increased pool size with the implantable sensor.
spk01: Okay. Appreciate the questions.
spk08: Our next question comes from Jason Bedford with Raymond James. Please go ahead.
spk07: uh good afternoon and thanks for taking the questions uh i wanted to ask about the patient assistant program so i guess early on you mentioned e3 is less expensive for for patients were you referring directly to the patient assistance program there no that i mean the biggest outside of that is really the you know any insertion expense right just got cut in half from four a year to two a year that's the that's of course the biggest driver Right. Okay. But reimbursement is still, your expectation is there's no change to reimbursement?
spk02: Yeah, we haven't seen reimbursement. As you know, we continue to see in the range of about $10 per day in commercial pay, although there is some variance from payer to payer, and Medicare is a little bit higher than that.
spk07: And just on the $99 patient assistance program, can you just put some context around it, meaning kind of what did the average user pay out of pocket in 21? What do we compare that 99 to?
spk02: Yeah, so there's a pretty good variation. One of the key differences with this, we are going to restrict this to people that have coverage. So in our prior bridge program, we did get a lot of utilization for people on United and Anthem that didn't have coverage. So that draw, I think average utilization was around $600. I think without those that have no coverage, this will be quite a bit less, so a couple hundred dollars perhaps.
spk07: Okay, and I guess just, I haven't fully thought through this, Maybe can you explain how this program impacts your revenue? Because I have to think through the billing, but I'm just kind of curious as to the impact of this program on your and Ascensio's revenue.
spk02: Yeah, so, you know, it is, you know, any revenue that, you know, that is not collected as part of this obviously is an offset. So, you know, we'll continue to report as we have been net revenue. And although there is some expected, it is an investment that we are jointly making with Ascensi in the space to bring people to try the 180-day product. But at the end of the day, it is a net revenue reduction, which is part of the basis for the guidance that we've built.
spk07: Okay. And just the basis for the guidance, the 14 to 18, that assumes that the patient assistance program lasts six months, is that right? Or the full year?
spk02: Well, it lasts for the first sensor when someone comes on, Jason, so, right? It could even go into next year for the second half starts.
spk07: Gotcha. Okay. That's helpful. And then just on the ICGM submission, I may have missed this, but this is after you start the 365-day trial, right?
spk02: We want to get the 365 IDE approved, Jason, right? Okay. Given the size, the, you know, the obvious opportunity for the one-year product and the pediatrics, that's our regulatory focus at this point. So not after we start the trial, per se, but certainly after we get the approval for the IDE. Okay.
spk07: And then maybe just for Nick, Nick, you broke up for me at least a little bit on the cash burn. I caught the Upper end of 70. What was the lower end?
spk04: Yeah, 65 to 70 million for the year.
spk07: Okay. Okay. Thank you. You're welcome.
spk08: This concludes our question and answer session as well as our call for today. Thank you for attending today's presentation. You may now disconnect.
Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

-

-