Agile Therapeutics, Inc.

Good afternoon and welcome to the Agile Therapeutics Third Quarter 2022 Financial Results Conference Call. Please note that 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 Third Quarter 2022 Financial Results and Corporate Update. Before we start, let me remind you that today's call will include forward-looking statements based on our current expectations, including statements concerning our financial outlook and financing prospects for the future. our outlook for the fourth quarter of 2022, management's expectations for our future financial and operational performance, including our expectations regarding the market growth of Twirla and our operating expenses, our business strategy, our partnership with Afaxys and its ability to promote growth, our product supply agreement with Nurex and its ability to educate patients about Twirla, our connected TV campaign and its ability to promote growth, and our assessment of the combined hormonal contraceptive market generally. 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 forward-looking statements. Please refer to our filing to 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 update for these statements except as required by law. The information on today's call is not intended for promotional purposes and not sufficient for a prescribing decision. Joining me on today's call are Al Altamari, Agile Therapeutics Chairman and Chief Executive Officer, and Amy Walsh, Chief Commercial Officer. Following our prepared remarks, we'll open the call to your questions. I will now turn the call over to Al.

Thank you very much, Matt, and thank you all for joining us on our call this afternoon. In my recent public comments, you heard me say how excited I was about how we expected our business to grow in the third quarter of 2022. Today, I'm excited to share with you how the financial results for the third quarter of 2022 exceeded even our expectations. I'll provide detail on the growth metrics that have us excited, and then Amy Welsh, our recently appointed Chief Commercial Officer, will provide insights into why we achieved significant growth in the third quarter and how we intend to deliver more positive results in the fourth quarter 2022 and beyond. The third quarter is the quarter we have anticipated as a potential breakout quarter for the company and the brand, and we believe we're starting to see that breakout. Let's review the metrics we are tracking and those we believe are most critical in helping us achieve our goals of growing Forilla and generating positive cash flow. I will start with reviewing our net revenue for the third quarter, which is $3 million. This is an increase of 43% from the quarter of 2022, the largest quarter-over-quarter increase our company has achieved since launch. Compared to the third quarter of 2021, net revenue increased $1.7 million, or 131%. Our net revenue reflects improvements in the following key areas. For all of demand for the third quarter as reported by Symphony was 28,450 cycles, a 35% increase from the second quarter of 2022. Compared to the third quarter of 2021, our total demand for Twirla grew by 18,706 total cycles, or 192%. Twirla factory sale for the third quarter, as reported by our wholesalers, was 33,282 total cycles, a 54% increase from the second quarter of 2022. Compared to the third quarter of 2021, our factory sales for Twirla grew by 22,632 total cycles, or 212%. You may notice a difference in the growth of our demand cycles versus our factory sales. We believe this is a result of the fact that not all the prescription demand in the non-retail channel is reported into third parties like Symphony Health or IQVIA. The demand numbers we received from our wholesalers do include the sales to the non-retail channel, and therefore, we believe that factory sales more closely represent the total demand for Swarala across all the channels. Operating expenses now. As you can see from the accompanying slide, this quarter, we are providing comparisons against the third quarter non-GAAP operating expenses because we had a one-time non-cash charge associated with the transfer of our equipment to Corium in the third quarter, and we believe excluding this charge represents a more useful comparison of the results from the operations in the periods discussed, which prior periods did not include a similar charge. GAAP operating expenses, or OPEX, were $20.3 million in the third quarter of 2022. Non-GAAP operating expenses for the third quarter, which excludes the one-time only non-cash $11.1 million associated with the transfer of the equipment to Corium, were $9.2 million. Non-GAAP OpEx in the third quarter of 2022 represents a 19% decrease from the 11.3 million reported in the second quarter of 2022. Compared to the third quarter of 2021, non-GAAP OPEX decreased by $5.2 million or 36%. Additionally, compared to the first nine months of 2021, we reduced non-GAAP OPEX by $10 million or 22%. In the fourth quarter of 2022, we expect quarterly OPEX to be in the range of 10.5 to 11.5 million. Our stated plan has been to effectively manage expenses while continually growing twirl of sales and demand. And this is the third consecutive quarter we have increased twirl of sales and demand while simultaneously decreasing the company's OPEX, excluding the non-cash one-time charge encouraged this quarter. As you can see on the accompanying slide, which compares year-to-date results for 2022 compared to the first nine months of 2021, we believe that these trends we're seeing tell us that we have a credible business plan in place that is performing. We're excited to share these encouraging numbers with you today, but we're not done. We're working and have been working to identify and implement strategies and exploit opportunities that will continue to further the growth. I'll now turn it over to my colleague, Amy, the primary office architect of this plan, to discuss how we're able to sell more products while maintaining a lower burn and why we believe we can continue this trend into the fourth quarter of 22 and into 23. Over to you, Amy.