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Senseonics (SENS)

Participants
Philip Taylor IR
Tim Goodnow President and CEO
Nick Tressler CFO
Mukul Jain COO
Mirasol Panlilio VP and General Manager, Global Commercial Operations
Mathew Blackman Stifel
Chris Pasquale Guggenheim
Danielle Antalffy SVB Leerink
Jayson Bedford Raymond James
Trent McCarthy Craig-Hallum Capital
Call transcript
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Operator

Good day and welcome to the Senseonics Second Quarter 2021 Earnings Release and Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Philip Taylor, Investor Relations. ahead. go Please

Philip Taylor

is This from Gilmartin the Thank Philip Group. you. Taylor

Relations about today, June Before Annual These you year expectations other reports plans, matters let the of performance that other only enhancements, begin matters, expressed statements events, XXXX product regulatory the cause by and we with management’s Factors and obligation elsewhere XXXX, statements. or or remind and detailed discussing update and the publicly for XX, filed section website Risk undertake forward-looking are me we documents different SEC. of company the reason, Form list our operating will We hereof. as ended include Company’s our reflect as forward-looking forward-looking XX-K any XX-Q no Investor Report speak future ended this the involve statements at XXXXoutlook. in call, available A to of materially any These XX, December Also, by for on under except for these be a of in revise that implied uncertainties. actual could these be www.senseonics.com. the date our from our is our statements to and those number of These quarter law. on risks statements results remarks factors required the forward-looking

Officer; to Goodnow, Chief and Joining me turn Tressler, Executive Tim Tim? over from I’d Senseonics call to CEO, President Nick Chief Goodnow, are Officer. and the With Tim Financial and President that, like

Tim Goodnow

of open patient address the Diabetes and revenue for from second the quarter, attrition, U.S. the $X revenue commercial call the plan, taking current Through progress Nick In collaboratively revenue Eversense up and and and product and of QX we commercial to $X.X U.S. to the our off on the first today. then, for in to us conclude will net the Senseonics for global financials Senseonics provide the achieved global of efforts operations, commercial our million, our million progress And Hello pipeline of $X.X Based which minimize the initiatives half partner discussing have from second Thank will updates range our everyone users. million. the Q&A. you. detail. I’ll million included full and global activities. of to be we joining full thanks led to outside regulatory the continued Care by maintaining million base year quarter Ascensia partnership integration revenue clinical, Ascensia the $XX has be expect continue the in $XX XXXX year, We’ll

the targeting onboarding intensively patients to to providers both limited represent focus These and in calling done access Eversense. traction, of and the providers, first Eversense disruptions know pleased the we’re that the us and are our new in quarter first user This a comprehensive foundation the are our stabilization on-boarded to has reach and the And at on focused our our operate XX to team the team are now regulatory ahead market we very access, of in sales distribution regain most As with including the work their expand and there Senseonics supportive last with of U.S. targeted of the it’s the are and now to force existing manufacturing Netherlands, invested successful effort at and U.S., the and the transition relationships. Spain, is coverage. on and installed and the base, service product reintroducing sets introducing of height we’re responsibility by to servicing additional clinical under for which clinicians the been skill introduce transformative to taken payers development, resources strong initial QX. This identified channel, maintaining currently technology. in trade impacted them sales CGM themselves, full care of well sales the continuing professionals trials rebuilding access, agreement, have in reimbursement, activities. make professionals prescriber clinical into as existing in the year, and members market experienced growth. pandemic out fully the they supported Eversense managed commercial retention, for driving who or Ascensia’s reimbursement medical by support ensuring of In In commitment sales, and of existing real collaboration practices. Coming the commercialization patients, in To they and assumed Ascensia the to be distribution, this trained this to as channels. for of U.S., remain second these on market inside are prescribers procedures reestablishing activities, customer reentry professionals half been pleased and of enables customer to two terms to Their existing our calling We patients sales Sweden Italy, their action existing commercial Germany, the aware and the clinicians. market by to both Poland, today professionals. the now the the product establish patients accounts. Norway, XXXX and this, Ascensia growth were with transitioned sales, marketing, actively and technology the steps is landscape patients. of team. systems. plan underway. product This for is training that trainers, plan We greater Ascensia along pursuit to is has new future is that how introduce diabetes their and support be To they on Sales commercial and have infrastructure required markets, market

This using Eversense. patient high program has have those costs whose and Ascensia a to while -- to accommodate out-of-pocket plans health their coinsurance designed program. is support with deductibles, costs, co-pay or launched assistance

program, users which Eversense sensor covers patient first U.S. pays the the for can to $XXX the after Specifically, per $XXX out-of-pocket. up access

qualify For those reimbursement than total annual sensor, CGMs the Eversense generally lower the full a cost for market. would other $XXX on per have who

Ascensia estimates be that over half of U.S. for assistance patient could using eligible program. the people insulin the in the mealtime

a economics the to with to from broader shares While Eversense. commitment are Bridge access intended a patient program previous group different the Program, our assistance help similar

DTC Two to strong will CGM There prescribe their Eversense. that ADA over have remain side, engaged Google. we main prioritizing campaign Assistance leaders established are nearly meeting, adoption of the calibration Program sensor. with and leads. system and From role the in lead industry generating impressions, of an of Facebook the Ascensia scientific meetings, or meetings provider PROMISE aimed clinical within in the to the quarter, Dr. to of the aspect measured data awareness day patient demand DTC their Eversense diabetes education U.S. both clinical media advertising The actively raising can patients highlighted HCPs. or the the initiatives The key safety search and who is time. conferences. profile Accuracy peers. those and second partner campaign at as Eversense clinical patient diabetes, ad important scientific patients impacts campaign and that from Garg’s overall date The direct-to-consumer resulted of a the an meetings have marketing the tools well-attended ask investigator, these system and was ability be in at digital opinion information with presentation through the about trial the million DTC and the experience XX Satish one audiences at who for awareness XXX-day awareness, by is aimed can and community sales healthcare our campaign study. seeking and infrastructure. we driving targets patient DTC where the initial MARD healthcare ATTD We There raising technology. positive managed increasing two X.X% per and experience share during drive primarily generating intensively presentation poll the featured X.X%. through to can play were testimonials The in to diabetes a with the presence accuracy industry-leading patients social consumer inbound most important And anticipate managing commercial in has an targets the effective Eversense with providers held to from

look We Ascensia to forward televisits received Together in sales national KOLs or small and the were and to reaching also local discussions directly broader near actively are meetups results which a we or peer in person are one-on-one via the seeing very were required. results, out group we community. with very force, proud of these review by And diabetes published future. well these the

diabetes, only with and the We communicate product also clinical Eversense to the have fuel not remain positive will on to to impact development gather but and insights commercial, clinical engaged activities. learn community, diabetes can

the our the care with as Cleveland, University Medicare HbAXc in clinical long-term will will using with least Eversense is diabetes to first XX program patients In The valuable share important the insulin of system as practice. such be coming in initial Eversense outcomes implantable They information CGM, use addition, Accountable to Ohio. in outcomes for this adopt the the include their and product with This such accountable reduction, regimens managed care patient at hope Care are We initial levels from and satisfaction during on use. to as at site ACO well, organization the now reported Organization and year. on a involvement clinical motion Hospital assess their learn inserted or population. ready into days program ACO our

largest smooth Eversense executed team’s able and we all progress Ascensia European CGMs In In marketing Italy and of established transitions as payers we contracts extensive Ascensia. most February. have model have knowledge continue the Italy, markets, learned and bases. the Eversense, Across Germany including our their market to two professionals familiarity in represent portfolios for and with quickly countries cover of added outside system prior implantable patient transfer started previous its were they the in This sales Germany, and been with the contracts the sales a the offerings. Moving to where our tenders. U.S., diabetes European from to sales majority new distributor. have to

associated we with and reach experienced a to As and efforts COVID, different have complicate regulations doctors can new different product. train with impacts regions

allow. Ascensia is patients existing on as servicing focused restrictions

as to full And Ascensia able a commercial to sales as We’re demand. marketing responsibilities, States, focus we of into sensor this products XXX-day With when working accurate existing activities well. closely show regulatory and are products, remains to our appropriate outside the system CGM to in and United features extended new clinical our intended we we align shown our the full duration excited developing have with profile research support Scandinavia and life. to sensor at levels after been channels and and resources two advancing towards that the assuming in allocate sensor have the agreement. throughout the patient highly they off are repeatedly lifetimes. Market Studies entered start are to optimize sought most sensor accuracy strengthening that we now be CGM solid our

improved to of of Eversense will gain with Our patients for less us believe share longer enable CGM. intrusive market lasting, help growth and which offering consists expand sensors, the iteration strategy we each benefits

base be Eversense. and we the our distinct through rates, which function believe is the lifestyle reinsertion desired patient loyal, evidenced shown offered benefits to highlights by As

be generated data our published filed to previously the side, the PMA which from regulatory to supplement PROMISE we study application, product U.S. used support last is was soon announced fall. the XXX-day being On

confidence strength estimate and evolving Use by quality the the our reiterated we was delays, continue with And Authorization reviewer the Though the based workload, discussion a submission, the pandemic lead on timelines. by and lead reviewer, end regulatory XXth. the of approval on with to of to previous made Following At make impact FDA its it submission the the the this on precisely comments and April in the based extended by agency situation the to timelines expect constantly officials. review the we also time hard on FDA assigned Emergency publicly the and product XXXX. of in

platform. technology we forward, generation continue progress next Looking to make our on

more We the product working this its are and management, needs a have that of of people are freedom. of year of designing attractiveness actively of again another week, The and a system one and would the revolutionize additional CGM represent only stepwise diabetes patients. patients The represents offer even And per lifespan one to the address calibration our we the on to the would such function product to we goal bringing lessening solution of believe market ultimate to industry. burden to development. goal require

centered currently goal, the intend are is technical and an activities technical testing. to of development whether the development product clinical working configuration IDE, this product FDA as over start been next the and year. turn completed, go of sensor. to advancing, of details realize optimization and will the begin The submit now who and quarter efforts first chemical discussed, Once focused half on the we the currently pivotal research Our call we the to for around in the second financial to to expect to results. steadily of our has trial over the Nick, I’ll previously

Nick Tressler

and Thank good afternoon, everyone. Tim, you,

in outside revenue net to U.S. the $X.X year-over-year $XXX,XXX of $X $X.X transition profit $XXX,XXX. partner in revenue for existing was million gross revenue QX of orders, pandemic. was reflect fulfillment of at second quarter Ascensia. of results off full of to our the written COVID-XX compared U.S. million. the activities QX Our second and increased onset million, the Gross XXXX the primarily by the the U.S. second the to utilizing quarter XXXX. total commercial and due EU the XXXX, quarter In The inventory was the million margin $X.X quarter positive to in was in

million the expenses in expenses to in approach in Second and in XXXX the primarily QX million administrative to XXXX $X.X increase was study development and an partnership. $X.X in compared million decrease changes clinical in year-over-year prior compared $X.X mostly increase $X.X quarter Research $X.X by period. collaborative market an to million driven million primarily increase and QX $X.X expenses prior personnel-related marketing decreased to year-over-year period, the $X.X year-over-year, year million increased personnel were and compared period. to our strategic The due million XXXX sales to prior through the by $X.X million, expenses. commercialization year Ascensia The of by was year million, $X.X costs General costs. in due the to related

XXXX, loss XXXX. second For million increase a operating XX, loss $X.X the million, $XX.X was of quarter loss in the three from months $XX.X of June ended operating This million one a ago. to represents compared in the led QX. in share Company’s noncash as the quarter first share the end a the of at significant quarter, in end increase The price price Company’s to compared XXXX of the second to at the charge of year

expenses period, accounting primarily financings, other equity Company’s million and value PHC compared along the year credit. result, charges noncash from the line embedded to a notes, prior by As XXXX to adjustments energy $XXX.X related notes including related resulting fair and increased for the XXXX XXXX the to the capital of derivatives with and

will or each Principles noncash based volatility Generally and vary, the the Company’s value As to mark Each statement. as recorded the of the of Accepted required U.S. these Accounting the price. charges the by income losses are interest for and these market to quarter GAAP, change for instruments these period, share gains values in reporting value noncash we on

increases, as gain. recognize if we and decreases, we share a incur a noncash price noncash So share loss, generally, price

$X of million. expenses second the the quarter out cash portion For other was the the of $XXX.X million total interest of expenses

In was previously cash accounting from half expenses of approximately by as in For operating the accounting XXXX, $XXX.X to primarily XXXX, million. other $XX.X loss a months as loss compared per million, the $X.XX related total charges was loss ended our to to increase the the company net three $XXX.X the in Net $X.X use million, XX, in of $X.X activities share increased the or quarter million June XXXX. million second per a million first to of noncash $X.XX from net increase mentioned due or $XXX.X well share, financings operations.

XX, cash, includes debt through QX. June This ATM of raised program for or primarily cash offering proceeds million approximately service. be long-term use and at-the-market As totaled of in $XX in equivalents XXXX, short investments $XXX The our will proceeds, million. gross equity

due significantly ATM payment shareholder and on interest kind loan PPP the the our cash, payment the notes PHC in in elected in use the lower kind associated cash with terms the PIK dilution in reduced repay pay results from conversion in or share of the will of option. price to we the the Specifically, of instead the raised Paying have interest to agreement.

we reiterating Looking of at XXXX remainder the the are our year, guidance.

Senseonics to between expect of for to half. We in million global million the $X.X $XX revenues of continue and million $XX XXXX revenue with achieved first

to For $XX With in $XX full range of be year in to used million operations XXXX, net remains to projected call I’ll that, turn million. cash back the Tim. the

Tim Goodnow

highly were activities. in we impacted to which To the Nick. the factors to pandemic, created from patient headwinds as market the commercial adoption commercial the initiate you, to better to new drive are anticipated worked a of us in review Thank Ascensia right gain the strategy delays reintroduced the and team positioned new year to-date, of with and market up, with believe right awareness Eversense. first These the product. partner actions the traction Eversense in on capitalize a our to half have with there gated wrap both, of We but in-person achieving we we amid potential rapid their

be growth, We partner to are collaborating patient launching to the drive including our increased and clinician access pleased initiatives program. with and marketing, on patient working

our see had patient motivated a Eversense. proposition this value offer And are users excited we with we’re continually belief already as in our will managing who value loyal benefits. are of commenting system the patients of their proposition reduces population. diabetes. to with and broader to burden Eversense have pleased We the been confirmation product confident We a resonate the our awareness its same how and more users. that have And users of the our many

that your we new today. Jain, to Commercial call our questions. technology, forward to for and loyalty. and a are And confident Operations. of our Mirasol like look and Panlilio, now sustained you questions our contribute joining are up patient build of I’d time Vice thank and additional to success lasting General for populations Operator, business. offer Global Mukul we and provider this Manager President future existing can Chief generations patient open the Operating and us we benefits, for Officer, absolutely let’s And will our As as growth

Operator

Thank you.

comes begin now will first Please [Operator We Instructions] Our question Blackman question-and-answer with go Mathew the Stifel. session. ahead. from

Mathew Blackman

just questions. review. Maybe we’ve FDA active my the couple Thanks everybody. hearing to your tricky some delays Tim, It’s further from peers filings. their have three. But, last on afternoon, I it. taking an some commenting for Good I about with appreciate been of start, weeks of of

So, provide on have that in any I from of coming can a is be later more color Thanks. would be your XXXX approval couple would where And you confidence helpful. follow-ups.

Tim Goodnow

seeing see here, There out. lead getting certainly our that past, than quarters. Yes. completed do the the in do, conversations there’s the recent in speak over where has that activities agency. although well, Obviously, the been on the it’s the we do they And have not where to as slower They path you process to significant there experienced -- return. a couple through have of that to them. COVID opportunity we impacted changes also have personnel with reviewer, the reprioritization people next some of lone we this some some been of are, only we’ve work has amount that with are they do of the based just And feel

Mathew Blackman

question the U.S. the access we but unfortunate, And then, here. in now. I to the the of able need clinician I’ll question. of to customer again, in of this the the I right some The the base? -- Ascensia months appreciate about asking it’s as in of resurgence a Nick. appreciate only sort then, and Thanks, that maybe of it’s patient think now Just different out ask existing few there majority clinics sort to reps for And the it’s has And Tim. throw relaunch just able because pretty part freely? just the are some engage that. been of last U.S. first But, curious U.S., been regions I And and then,

taking into think the you any important impactful the given qualify. of that more assistance But insulin assistance programs little baked Tim might a maybe XX% guidance program in of heard now be question terms is that may may mix the mention patient the how to about guidance? have in patients on quarter. patient curious that bit. suspect have mealtime Just your maybe I I up is, weighed

guidance. of So, maybe help little a the the bit in Thanks. understanding moving parts

Tim Goodnow

reps able those you as Sure, if won’t the Matt. regional pick the in able all sales that I up been again to U.S. access. have over you’re They been new the be of have will, say less up in they’ve do some initial because I’ll to And been aware, picked person in conversations. Europe forgiving, The time. have the restrictions. of

do understand out lot will have the on most prescribers that product. to to reach But able a currently in So, we to this of we’ve continue general, that patients existing change. been the of

COVID. back those have work that Ascensia stopped on to Some resurgence. the program. in have Nick, the some televisit yet I’ll a on it see and capability to through we’re forward. But, commercializing, the continue time we while And speak of moving of be assistance impacts going the to is to to through to we’re we this and get patient let that of to continue moved do just focused the certainly, lot use going some to that during that’s we you work

Nick Tressler

for question. yes. Sure, you, Matt, Thank the

and overall as there’s mix the that product our number look additional economics is program, regions. a the of partnership. for the terms is there’s take we of looked a taken assistance But from of also factors the forecasting the In patient at that Certainly, across including payer revenue other we year, at that mix factors.

virus then globe. guidance two currently terms mentioned the one of really So, you and strains at stage the new of in approval driven this XXX-day timing the circulating the by is U.S., from Again, that potentially the our factors. in are any impacts

Operator

Please Pasquale Your go next comes with Guggenheim. ahead. Chris question from

Chris Pasquale

on that the the actually you last from just this assume year point. up that Nick, benefit get follow XXX-day any guidance Thanks. Does sensor? to

Nick Tressler

in in QX. It does a include from U.S., XXX pickup amount the small of the

Chris Pasquale

things. just Okay. financial from then, a of And a side couple questions of

do you the of been written any inventory hold and the through down have left year, So, could has care or of? during back still COGS half that taken now off flow

Nick Tressler

have and off Yes. normalized extinguished written see margins material that will the We project more for that back fully in QX, half the of we year.

Chris Pasquale

And range up then G&A why from of sequentially? a here, marketing. had and of expense in you kind for then, lower undid X.X been sort all some year and X.X tick Okay. so the benefit up to did And much of guys running a the sales shot and sudden it half a and of having now,

Nick Tressler

noncash Sure. compensation both is driver expense, biggest we’re seeing. driver component. there’s That there and main Yes, that stock cash the is the

Operator

Our ahead. Antalffy Leerink. next go SVB comes Please with question from Danielle

Danielle Antalffy

a bit bit on you’re a over product could give Congrats since little a there the established you the on quarter. had if I more strong Ascensia’s longer, color really little Europe. a in wondering more bit was some metrics in Europe,

example, reinsertion to and if this growth things existing physicians, physician rates, the the XL that? things of, getting then like like like same-store way right know with sales, don’t versus So, about it, I XXX-day, thinking is I’m sort think but new Europe, user for also things in over

Tim Goodnow

COVID the it impacted much certainly In say for I right, largely would Europe U.S. coming Danielle, the U.S. learning pretty they’re the Sure, still time couple and by they’ve you’re more up months in in was. longer the for curve. well. actually Europe, is than had the a But of second than quarter as that thanks still,

dynamics those of some So, to be considered as needs well.

haven’t we notable rates, a seen assertion on Specifically change.

people on you the product. the locked recall, and really higher product, hard third work on and they’ll or and to we’ve into as really on stay As on first typically XX about get insertion, XX continue seen XX% beyond, second, to the

haven’t in been that but us. clinics, new at of for change, So, patient challenging time has been we starts, the new COVID especially seen has

Danielle Antalffy

just a on That’s the fair follow-up Okay. I reinsertion point. guess, a rates.

at to with then chance those move then or XL, actually expect reinsertion time, stay longer and those the with you reinsertion wear Thanks there’s that do that longer rates you you much. a and rates higher wear? that do if so XX Now, over get think XX, XX,

Tim Goodnow

math certainly of just wear because the longer Yes. the occur. year change there’s to that two times Well, for a helps,

have half come the a the for of material say, off biggest of make economics. that those are continue XX% off, that coming About that is around would because sensor I do retention, especially improvement So, still to does that impact. first economic. for we

So, as we more biggest around us for and coverage improvement that’ll be get see more globe, to opportunity the there. the

Operator

Our with ahead. comes next from Bedford question Raymond James. Please Jayson go

Jayson Bedford

Good afternoon. Hi.

a attrition. you Just minimizing patient mentioned remarks, you me. questions did in opening Tim, in your meaning for few quarter-on-quarter base Have XQ? grow patient succeeded, the base

Tim Goodnow

really when for heaviest us base attrition really Patient the was activities. stopped XXXX, Jayson, commercial in we

the for initial what that’s So, in has bring Ascensia efforts been U.S. to really that back.

always and that of our through stabilizing good really growth obviously like market are have. calling And COVID is the accounts. we’d really dynamics. patient more on than initially a are we making progress, to That’s of but the name of activities time the So, that game. reference. both commercial the see focus pretty dramatic on was been with really I feel course, They existing stopping the primary my had But, you’d that

Jayson Bedford

Okay.

On for XXX-day, is that the primary expectation both you the the approved get the SBA and sensors?

Tim Goodnow

We’re it, working on Jayson. still

work working As to review. have to the an approved, our agency. from we approved the are stay regards what gets with formulation, with and tuned. technical agency But, publications, we we’re we’ll those actually for continuing you that In saw do in

Jayson Bedford

economics patient for revenue for of Does by maybe clarity. your Ascensia most impact new absorb there? program Nick, And generation the then, Okay. just Ascensia assistance the or does

Nick Tressler

Yes.

a and previous assistance and is the is level patient program taking taken partner Ascensia. So, net between gross deduction the at us split

Operator

with Our Please next Nowak ahead. question Craig-Hallum Capital. from comes go Alex

Trent McCarthy

the the Hey, the me. couple on force, you the through specifically speak Trent in when for McCarthy reception originally to Ascensia on clinician sales guys. XXXX? of to for Alex. This questions A launched Can is relative maybe Eversense Company product

Tim Goodnow

And consideration Well a change prescriber. since XXXX payer the really coverage. in we launched been is significant for that biggest has certainly, the a

in quarters the focus much than we’re exact prescribers. better, our said, that early recall, Ascensia as better do fact but couple been existing most So, of much, with of I our shape the on in reception has and much here

of have it. of reception are, Eversense course, they fact, a utilization just good So, a have and predisposed positive by to that of

Trent McCarthy

to the just are trained many a April? guess, started selling insertion How Ascensia the to perform changed, has how many I in prescribing that. actively follow-up device? this maybe clinicians are how clinicians And and since And quick

Tim Goodnow

reduction did by doing that I also of you. sales we insertion, by an a notable in lack exact much that the don’t number folks the But, see COVID, were in XXXX, have numbers active of amount for the force. our of driven

focus to on that currently is really now. the that it working on clinicians and back. that are Ascensia continue we XXX It’s top doing focus on bringing right the So, existing a

Operator

next from comes question Thibault with BTIG. Marie Our

Unidentified Analyst

afternoon. This Eiber for Thanks Good from taking on is Hi. [ph] Marie. question. Sam the

quarter. Just the I one growth, Thanks. that’s there. marketing guess, commentary quarter? on impressions efforts appreciate from I on and me on the starts the over color patient the the Any XX during DTC million impacting how your maybe

Tim Goodnow

activities that pretty the up patient efforts. prior starts I’ll what our back XX% did COVID our had to from anew. we But, anticipate to. Sure. About this just significant speak we amount, DTC history, previously do as Maybe come is is to getting see the a of

that anticipate forward. able reach in would move I future the So, to we’d we be as level that

Operator

back turn question-and-answer the remarks. our Goodnow Tim would over closing for any conference I concludes now like This to session. to

Tim Goodnow

forward to the with our good opportunity afternoon. you that, look and With next day. like their this you. We November thank an giving period. at I’d the for again you a update in everyone about quarterly call speak to time Thank Great. to And have time

Operator

Thank presentation. attending conference The today’s you is for concluded.

disconnect. now may You