Senseonics Holdings, Inc.

Good day and welcome to the Centionics third 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. 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 today's event is being recorded. I would now like to turn the conference over to your host today, Tripp Taylor with 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 September 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'd like to turn the call over to Tim Goodenough, President and CEO. Tim?

Great. Thank you, Tripp, and thank you all for joining us today. Today's call will start with an overview of our quarterly performance and an update on Senseonics' continued execution of strategic initiatives, including support of our commercial partner. Then our Chief Financial Officer, Rick Sullivan, will discuss the third quarter financials in detail, and we'll open up the call for questions. During a third quarter, Sensionics generated total revenue of $6.1 million, representing 33% growth compared to the prior year period, including $4 million of revenue in the US and $2.1 million from outside the United States. Expanding ever since patient adoption and advancing our technology pipeline remain the top priorities for our business. Our commercial partner, Essentia Diabetes Care, continues to work to drive greater market access and recognition for Eversense. They are implementing a commercial strategy that includes downstream marketing activities that build awareness with both healthcare professionals and patients and are taking steps to ensure that all constituents have a positive experience with Eversense. This includes continuing to expand their dedicated commercial organization in the U.S. towards this goal. During the third quarter, ADC expanded their commercial investment by partnering to develop a fresh, new, integrated marketing campaign with Space 150, an innovative digital agency with proven experience in driving demand of disruptive medical device technology. For background, CGM brands today broadly sell themselves as a panacea that makes managing diabetes easy and effortless. However, this is not the case. Certainly for millions of people living with diabetes around the world, CGM has become an indispensable tool in managing the condition. Yet many users spend too much time managing the shortcomings of their technology. It's estimated that half of the people currently using CGM brands are not fully satisfied and experience common frustrations with their devices. Issues such as sensors falling off, skin irritations, excessive overtaping, accuracy issues, and short sensor life. As a result, many patients take breaks from their CGMs, reducing the clinical and safety benefits the technology provides. We designed Eversense to specifically address the issues intrinsic to traditional short-term transcutaneous CGMs, and the new direct-to-consumer campaign aims to inform patients on the benefits of Eversense and why it's the CGM for real life. The campaign represents the most significant investment in direct-to-consumer marketing for ever since, and includes extensive reach across digital and social media, as well as new TV ads on digital television platforms such as YouTube, Hulu, HBO, and Disney. They are also testing the new TV ads on traditional broadcast television in five metropolitan markets, including spots during NFL games and the recent World Series. As ADC monitors the results of the campaign, The plan is to broaden them in 2024. While only a few weeks into the campaign, the early results are certainly encouraging. The campaign's theme, the CGM for Real Life, resonates with patients who want to benefit of CGM without the traditional drawbacks. Feedback from the provider community has been positive as well, and we expect it will increase awareness and support within the clinician practices. In the third quarter, several initiatives that strengthen access for Eversense were advanced by ADC, including gaining traction on the prescriber first strategy. We've expanded the inserter network through both organic inserter development as well as our partnership with a nurse practitioner group. Through this partnership, we promote Eversense to prescribers not trained to do insertion, such as family practitioners and internal medicine, so they can simply prescribe the system and their patients can be matched with convenient insertion options. As a quick update on the Nurse Practitioner Group Partnership, we have already exceeded our original target for the number of NPG locations in 2023 and are proceeding with expansion plans for the remainder of this year and throughout 2024. The program has been very well received by both patients and prescribers as indicated by the growing number of users receiving their insertions through NPG, from 12% in Q2 to now 18% of all insertions in Q3. We're also encouraged by the expanded opportunity with basal-only coverage across commercial payers that apply to Eversense. The majority of our patients are Type 2, and we expect this to increase with the basal-only coverage. On that front, we're working to harmonize the Medicare coverage for basal-only to include implantable CGMs through Medicare and the Medicare administrative contractors. In fact, most of the MACs have published updated LCDs that include basal-only coverage from implantable CGM for public comment, and we anticipate the remaining ones to follow soon. We've had successful meetings during several of the MAC's comments periods, and we expect that they will begin publishing the updated policies in early 2024. With the expansion of the basal-only indication across commercial and Medicare plans, we anticipate continued penetration across the Type 2 market going forward. In Europe, ADC has seen mixed results and is focused on driving performance across its markets. Italy has seen notable growth, increasing users by over 20% during the year. It is now our largest European market based on active users. Italy continues having success executing in areas where there is positive tender coverage for ever since and is seeking to expand that coverage when those opportunities become available. ADC is also making progress in some other European markets. Based on positive tender performance in Spain, active users during the year are up over 40%. And in Poland, following new reimbursement coverage, users are approximately doubled. ADC continues to transition the sales channel in Germany amid market dynamics. A new German CGM business leader has started, and the transition of territories was completed during the third quarter. We are also pleased to have recently received a German medical aid code for Eversense. This includes Eversense and the national catalog of reimbursable medical devices demonstrating to providers that EverSense is no longer reimbursed only on an exception basis by insurers. We believe this should result in a simpler and faster reimbursement in the German market. ADC has seen indications of stabilization of the German business, and given the size of this market, it's an important endeavor for the ADC team in Europe. Transitioning now to our clinical and product pipeline, we are continually continuously advancing our new product initiatives targeted over the next quarters and years where we expect to leverage these new products to drive increased adoption. The next few years represent an exciting opportunity for Senseonics as they have a strong product pipeline that we are confident offers important growth opportunities. Leading the way in terms of our next generation product is our 365-day system. We recently announced the completion of the Enhanced Pivotal Clinical Study Adult Cohort as it is now in the data collection and analysis phase following completion of the 365-day visit for the final study participant. This represents a significant milestone for Senseonics as it worked towards offering the differentiated benefits of implantable CGM for one full year with just a single sensor. We appreciate the efforts of the participating investigators and patients and look forward to analyzing the data, preparing a submission, and working with the FDA with the goal of securing approval for the planned one-year Eversense system in the coming quarters. As previously discussed, our CGM designation for Eversense has been submitted and is under review with the FDA. We anticipate feedback in Q1 and look forward to the potential this designation would offer. Over the past few quarters, we have discussed the importance of integration with other diabetes technologies and recognize the opportunity to provide additional benefit to people with diabetes. Specifically, integration with various insulin delivery devices is a priority for Senseonics. Finally, we continue to advance both our Gemini and Freedom systems. Our nearest-term focus is working to incorporate self-powering for the sensor with the implantable battery, and we are on track for human feasibility studies in early 24. We're excited that this next step is right around the corner, and we'll provide more information as the program progresses. With this, I'll now turn the call over to Rick for a review of our financials.