Senseonics Holdings, Inc.

Good day, and welcome to the Censionix Second Quarter 2023 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 on your touch-tone phone. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one. To withdraw your question, please press star, then two. Please note this event is being recorded. I'd now like to turn the conference over to Tripp Taylor, Investor Relations. Please go ahead.

Thank you. This is Tripp 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, 2022, our 10-Q for the quarter ended June 30th, 2023, 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. Joining me from Censionix are Tim Goodenough, President and Chief Executive Officer, and Rick Sullivan, Chief Financial Officer. With that, I would like to turn the call over to Tim Goodenough, President and CEO. Tim?

Thank you, Tripp, and thank you all for joining us this afternoon. Today's call will start with an overview of our quarterly financial results, followed by an update on Senseonics' continued execution of development, clinical, and commercial programs to drive growth, And our Chief Financial Officer, Rick Sullivan, will provide details on our financials and will open up the call for questions. In the second quarter, Senseonics generated total revenue of $4.1 million, representing 11% growth compared to the prior year period, including $1.8 million of revenue from the U.S. and $2.3 million from outside the U.S. Eversince shipments continue to be in line with our expectations for 2023. The second quarter continued to be productive for Senseonics as we advance our initiatives designed to improve ease of use and increase patient adoption of Eversense while enhancing our technology pipeline. To begin, I'll describe recent progress that we've made in our collaboration with Essentia Diabetes Care, our global commercial partner, on their initiatives to drive adoption of Eversense by providers and patients. Together, we are focused on two main objectives. increasing awareness in the market, and increasing access to Eversense by our users. During the second quarter, we made meaningful progress in both areas, including the expansion and training of new sales professionals in ADC's dedicated U.S. CGM sales force. We also earned a positive policy decision from UnitedHealthcare to cover Eversense as of July 1st, and we increased regional coverage by the nurse practitioner group certified and credentialed practitioners who conduct Eversense insertions. Broadening the commercial footprint is a critical component of increased awareness and access in an area in which Essentia continues to invest. An expanded sales force is enabling increased physician interactions and new account engagement, which ADC will leverage to increase their presence in numerous territories. The sales force is planned to increase to 50 professionals, while currently at about 45 reps who are onboarded and trained. Ascensia expects a few quarters for individuals to ramp to full productivity after onboarding. In addition to growing the dedicated sales force, ADC is investing to enhance the Eversense brand. They are focused on developing new consumer-facing materials to expand and increase the awareness and benefits of Eversense. We believe a strong, cohesive brand message outlining our product's unique characteristics will help position Eversense as a leading CGM solution in patients' and clinicians' minds. We look forward to ADC rolling out updated messaging and creative in the coming quarters to advance the brand's positioning. It's known that every diabetes patient can benefit from Eversense and should be able to access Senseonics technology. The partnership has established several programs that support this vision. While our initial focus was to train endocrinology professionals to do the insertion procedure who have large populations of diabetes patients within their practice, the second phase of our strategy, we call Prescriber First, is underway. It expands on Eversense Endocrinology Inserter Network by providing convenient insertion options to patients managed by a broader set of healthcare professionals, such as family medicine, primary care, and internal medicine. those treating the increasingly growing Type 2 patients who use Eversense. As part of this, the Certified Eversense Specialist Program identifies and trains healthcare professionals on the procedure who are interested in accepting new patients for insertion. Additionally, and in a parallel vein, the Nurse Practitioner Group is an instrumental partnership that was established at the end of last year and continues to account for a growing portion of Eversense insertions. In the second quarter, over 12% of the total insertions are completed by NPG. This is more than double the prior quarter. NPG currently has Eversense insertions in over 30 cities, and they are on track to expand further by the end of 2023. Leveraging the extensive team at NPG, along with a certified Eversense specialist network, not only makes it easier for patients to get Eversense, but it also streamlines the process for physicians who want their patients to get the benefits of Eversense, but prefer to prescribe and leave the insertion to another provider. In parallel, ADC is expanding their clinic targeting to prescriber-only physicians to inform them of these new options so that they can easily manage their patients with Eversense. This strategy allows sales reps to focus more on selling the unique benefits of Eversense and less on the associated workflow and insertion process. thus enabling the field sales and clinical personnel to expand their reach and connect with more healthcare providers. Additionally, in supporting further expansion as physicians learn of the benefits of Eversense, combined with the established reimbursement for performing the procedure to receive requests for insertion, training for physicians who want to prescribe Eversense and insert Eversense for their patients. We continue to support and certify them. Ultimately, we know it's important patients have easy, convenient insertion options, and we're making great strides for expansion across each of the three strategic networks, NPG, Certified Efficacy Specialist Network, and the traditional prescriber-inserter positions. Building on these initiatives, ABC continues to take active measures to increase access to the patient assistance program. The current program, which offers $99 copay on each of the first two centers, gives patients the opportunity to wear and become familiar with the convenience and benefits of Eversense for a full year without worrying about large copays or deductibles. This program ensures that we can support more patients in experiencing our product's benefits over a longer term and prepares our markets for the 365-day product that we expect in 2024. Writing out our progress on access, we recently had a positive coverage decision for implantable CGM from UnitedHealthcare. As of July 1st, UnitedHealthcare began providing coverage for EverSense for people with Type 1 and insulin-requiring Type 2 diabetes. United was the last top 10 payer not covering Eversense and now adds an additional 45 million lives to our coverage population. With this addition, we are nearing almost all insured adults in the United States having access to the Eversense system, thereby expanding coverage to benefiting approximately 300 million covered lives. United's policy updates adds to the extensive number of payers who include Eversense in their CGM coverage policies, as well as paying for the healthcare provider's time for the in-office insertion procedures. Importantly, this allows ADC to introduce the ever-since CGM system to more people living with diabetes. Shifting now to a brief update on our partners' efforts in Europe. Similar to what we discussed last quarter, ADC is continuing to work through the changing market dynamics in Germany and is focused on executing new distribution channels. These are addressing reimbursement and taking action to ensure patients have access to Eversense. We continue to see attractive growth in our second largest European market, Italy, where we are continuing to win new tenders. Further supporting our Eversense awareness initiatives, we published key clinical data in the second quarter of this year's ADA meeting. This includes two studies that demonstrate the safety, accuracy, and longevity performance of Eversense. The first study showed that a modified Eversense system provided accurate performance through the full 365-day period with a favorable MARD longevity and safety profile. And importantly, this is the exact configuration that is currently under evaluation in a 365-day pivotal trial. We believe that performance in this study bodes well for our ongoing 365-day trial, which is planned to conclude in the coming weeks. Additionally, the second study importantly showed that statistically significant superior health improvements were achieved with the use of Eversense in CGM-naive patients compared to their traditional self-monitoring of blood glucose routines. These studies demonstrate the value of our product pipeline, which can provide for patients and providers an expanded and advanced technology with future generation products. These coming products are centered around advancing our Eversense system forward through adding further significant differentiating features. We are confident that these new products can keep Senseonics at the forefront of diabetes technology innovation and be incredibly appealing to the patients and providers. In the nearest term, we are focused on extending the wear time duration of Eversense to one year. The 365-day enhanced trial is designed to evaluate the accuracy and safety of Eversense for our next-generation sensor, and this pivotal trial is nearing its completion as the last patient evaluation visits will be finished in September. Our goal is to continue expanding our ability to transform the lives of those in the global diabetes community, and positive results from the one-year trial will be a meaningful step forward. As an important milestone and update, we are pleased to announce that we have have recently submitted to the Food and Drug Agency for the ICGM designation for Eversense. Our expectation is an approval in early 2024 that would enable our ability to integrate with insulin delivery devices like pens and pumps to create systems that would use Eversense for autonomous control. Encionix has a number of development programs currently in place utilizing the planned ICGM designation and we look forward to providing details of these partnerships in the near future. In addition to the enhanced trial for a 365-day sensor, our product pipeline focuses on adding independent power and direct communication capabilities to our sensors. These advances would allow for the intermittent glucose monitoring based on swipe queries and ultimately remove the need for any on-body transmitter. We continue to make positive strides with both the Gemini and Freedom systems. We believe these products have the potential to offer patients increased flexibility, ease of use, and simplicity with a goal of achieving patients' most desired features, high accuracy, independence with extremely long wear time, and the freedom of not needing to wear any device on the skin. I'll now turn the call over to our CFO, Rick Sullivan, to go over the details of our second quarter financial results.