Agile Therapeutics, Inc.

Good afternoon, and welcome to the Agile Therapeutics Second Quarter 2022 Financial Results Conference Call. Please note, today's event is being recorded. I would now like to turn the conference over to Matt Riley, Head of Investor Relations.

Hello, everyone, and welcome to today's conference call to discuss our second quarter 2022 financial results and corporate updates. Before we start, let me remind you that today's call will include forward-looking statements based on current expectations, including statements concerning our financial outlook and financing prospects for the future. Our outlook for the second half of 2022, management's expectations for our future financial and operational performance, including our expectations regarding the market growth of Twrla. Our business strategy, our partnership with Afaxis and its ability to promote growth, our product supply agreement with Nurex and its ability to educate patients about Toella, our connected TV campaign and its ability to promote growth, and our assessment of the combined hormonal contraceptive market in general, among other statements regarding our plans, prospects, and expectations. Such statements represent our judgments as of today, are not promises or guarantees, and may involve risks and uncertainties that may cause actual results to differ from the results discussed in the four different statements. Please refer to our filings in the SEC, which are available through the investor relations section of our website, for information concerning risk factors that may affect the company. We undertake no obligation to update forward-looking statements except as required by law. The information on today's call is not intended for promotional purposes and not sufficient for prescribing decisions. Joining me on today's call are Al Tamari, Agile Therapeutics Chairman and Chief Executive Officer, and Amy Welsh, Vice President of Marketing. Following our prepared remarks, we'll open the call to your questions. And now I'll turn the call over to Al.

Thank you, Matt. And thank you all for joining us on our call this afternoon. We had a busy and productive quarter. And on this call, I'll review the key areas of the second quarter 2022 financial performance, our current cash position, and then provide a commercial update on scoreline. I'll then hand over the call to Amy Welsh, who leads our commercial efforts preview the upcoming launch of a new initiative with a leader in female telehealth, Nurex, a 30 Madison reproductive health brand. We believe the execution of our plan in the first half of 2022 has set us up well for the remainder of 2022, and I want to start off by discussing three accomplishments. We continue to grow twirl of demand and revenue. we have significantly reduced our operating expenses or OPEX. We have raised additional capital that we believe is sufficient to fund our operations through the end of 2022. First, let me touch on the twirl of demand and the company's OPEX. We are proud that today we report our second consecutive quarter of growth of twirl of demand or cycles and at the same time reducing our OPEX. Total cycles for the second quarter were 21,083, which fell within our updated guided range of 21,000 to 21,500. Growth in the second quarter cycles represents a 27% increase from the first quarter of 2022 and help us realize net product sales revenue of 2.1 million which is also within our guided range. OPEX for the second quarter of 2022 was $11.3 million, which is below the updated guidance range of $11.5 to $12.5 million. The reduction in OPEX was primarily attributable to the optimization of the Trolla Salesforce to better focus on the most productive territories with high volume and favorable third party reimbursement, as well as reducing expenses across all other areas of our business. These improvements in OPEX have resulted in a $12.2 million net loss for the second quarter of 2022. In the second half of 2022, we expect quarterly OPEX to be generally in line with the second quarter of 2022. Current and prospective investors have expressed a desire to see the company effectively manage expenses while continuing to grow the 12 demand. By demonstrating consistent progress in both of these areas, we believe investors are beginning to see what we see, which is a company with a path to reaching our goal of becoming cash flow positive. We believe we advance our goal of financing our operations, by raising proceeds through our at-the-market or ATM offering in the second quarter of 2022 and via the public offering in July of 2022. The $12.2 million in net proceeds from our ATM financing activities have allowed us to end the second quarter of 2022 with approximately $13 million in net cash. When combined with the $22.2 million in net proceeds from the July public offering, we believe we can fund our operations through the end of 2022. As previously announced, we have reduced our outstanding debt with Perceptive Advisors to $3 million by using the proceeds from the ATM. We paid $5 million to Perceptive during the second quarter, And in July of 2022, we made an additional prepayment of $7 million in exchange for a waiver of certain financial covenants at the end of 2022 and the release of our manufacturing equipment to help us restructure our commercialization agreement with Corian. We appreciate the many years of support from Perceptive, but believe the meaningful reduction in our debt improves our balance sheet and gives the company flexibility in future capital raises as well in business development and partnership opportunities. Securing this capital was a testimony to the management team and the business plans we have in place. So we believe we're now positioned to move forward in the second half of 2022, and we believe the right question to ask is now, how can we continue to responsibly manage expenses and continue to meaningfully grow the toilet business? And we think the answer to this question is to continue to execute the initiatives that drive volume in both the non-retail and the retail channels, while also seeking and mobilizing new strategic initiatives that can augment our business. I'll now provide an update on the FACTSIS and our DTC marketing efforts. I'll then turn over the call to Amy, who has been leading the charge on all of our commercial efforts to talk to you about the upcoming launch of our collaboration with Norex. One of the most important questions we received is the EFACSIS relationship making impact for Agile and Twrla in the non-retail channel. While the EFACSIS partnership required a significant lead time to train and deploy, we believe we're starting to see that translate into volume. In the first quarter of 2022, 485 non-retail cycles of twirl over dispense. In the second quarter of 2022, that number increased by 189% with dispensing of 1,404 non-retail cycles of twirling. We believe there's even more upside in this channel based on the reach of the AFAXIS customer network. With the recent Supreme Court ruling, we are proud to make cork twirl available to non-retail channels. Amy, who you'll be hearing from shortly, galvanized our partnership with AFACSIS in January of 2022, ahead of the Supreme Court decision. And we continue to believe it is important to support the Planned Parenthood organization. Through their group purchasing organization, AFACSIS primarily provides services to the non-retail channel. Additionally, a co-promotion program for Terrola with AFACSIS Pharma has the potential to access over 25,000 accounts, including Planned Parenthood and college and university health centers. Therefore, we believe we can realize even more meaningful volume in the non-retail channel, and with the faxes, we expect to continue to make inroads in Planned Parenthood and other non-retail customers. Related to college and university health centers, we are approaching the back-to-school season. which has historically been an active time of year in contraception. For that reason, we'll be focusing on targeted promotion of our Twirla direct-to-consumer campaign on connected TV, also known as CTV. As we previously stated, we're deploying this commercial with a highly targeted, efficient focus on women in the target demographic of 18 to 24 in states that have large markets for contraceptives and potentially strong reimbursement for Twirla. Our initial run of the commercial launched in April of 2022 and garnered positive results as we helped raise awareness, trial, and adoption of Twirla. Our data continue to show us that many women who try Twirla stay on Twirla and become retweet users. By deploying our CTV commercial at this time, When women in our target audience are having birth control conversations with the prescribers, we expect to add more long-term repeat use of the formula. Again, we think the right questions to be asking are factors and CTV programming working and having an impact on our business. We believe the answer is yes. In the first week of July, 2022, we surpassed 33,000 739 total prescriptions dispensed for twirlers. To put that in perspective, that's more than we did all calendar year 2021. And we believe the partnership with FACTS along with our targeted DTC efforts helped drive this growth. We have always said we will explore the right partnerships and initiatives at the right time to help grow our business. We continuously look for opportunities to grow our business, and I'll turn over the call to Amy, who is excited to discuss an upcoming initiative with Nurex, which we believe can contribute to the retail growth by driving our DTC and CTV efforts. Over to you, Amy.