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Senseonics (SENS)

Participants
Malcolm MacLeod Investor Relations
Timothy Goodnow President & Chief Executive Officer
Nick Tressler Chief Financial Officer, Secretary & Treasurer
Colin Clark Stifel
Sam Eiber BTIG
Alex Nowak Craig-Hallum
Call transcript
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Operator

Good day, and welcome to the Senseonics First Quarter 2022 Earnings Conference Call. [Operator Instructions] Please note today's event is being recorded. I'd now like to turn the conference over to Malcolm Macleod, Investor Relations. Please go ahead.

Malcolm MacLeod

Thank you. from Group. Macleod Malcolm is the Gilmartin This

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

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

Timothy Goodnow

this us for and Thank thank you, Malcolm, all joining you afternoon.

important system opportunity April X-month Eversense short-term all the of of and base and benefits designed the in and EX. commercial milestone. the people revolutionary we'll just means provide the to EX to with of high was wear, now the our large us EX that which Endocrinology experienced our updates for as to patient to first like is extended the the to and by well week degree the for patients achieving Alabama our launch. diabetes. convenient insertion choices team, On new first CGM increase high, quarter in was more as performance, those wear engage of simpler, participants of top-tier limited the this the part lasting U.S. first advancement focus In at important we system support the this offers excited study over monitoring only in today, and lasting twelvefold, per X we exist product EX to is even performance practice, are CGM also to EX the months it our U.S., the this would HCPs and With for continue population X procedures we have market of measurement the on to time EX the less the spent help progress the for with clear a in Interest longest on the glucose this CGM which expensive at long-term X of to launch major managing the as call first performed initiatives demands accuracy, questions. the for user the FDA patients. and in financials, and represents the open duration Nick both about MARD of of transcutaneous CGM the step, but year, it patients pandemic, East CGM the Patients longest with months today. with impressive how achieved in I've alternatives system. makes Eversense with through seek the X.X%. and of sensors continuous In instrumental the PROMISE quarter recently field I of insertion were a at discuss glucose February, we'll whom thank up the FDA then approval will pipeline. the professionals call the Not investigators

We sensor wear product evolution penetration for advancement in duration opportunities to market Eversense. in we each represents believe achieve step-wise continue expansion and market a differentiation,

to activities Before highlight the results. we move Ascensia, for first April like partner, our commercial would quarter our to launch I

which For from revenue, million million and we current-generation Senseonics generated Europe products. $X.X included down from as $X.X U.S. $X.X the the wound million,

were notably the to results EX The plans first transition new product. inventory driven quarter by

As to a and commercial implementing partner on Senseonics the of global commercial CGM our product the the design, U.S. development focus XXX-day maintains strategy launch comprehensive systems, is Ascensia manufacturing the in innovative

Significant the delivered XX-day weeks targeted awareness sensors investments new into initiatives. the the we and according forward While support in would first enhancing users with patient integration transition like system access sharing adoption still weeks adoption X early HCPs through manufacturing, share information I and channel. X-month distribution of the approval, the updated and just Senseonics-Ascensia elements will in to in, the FDA provider from from for clinician the new the launch initiatives completed of being early at ADC it EX, insurance on focused the calls. to just worked current primarily Ascensia the of packaging the of and year, weeks for some few transitioning physicians strategies period for products shipped across are first have look programs We following is the insertion. as are This we EX time, key out impressions as the access on and expanding and to In well these EX labeling In HCP made demonstrates system, roll collaboration our to short and future in the more patient to FDA to as and past the we ensuring excitement EX outline patient we the users coverage. be In continued to and to the half operational U.S. new product. payer patient X to

contracts, with these believe new distributor the serve force providers. initiated initiatives patient on patients will the and well as programs the new to We trained product executed assistance HCPs. more as sales enable and and Ascensia programs label Ascensia introduction

that of We transition the of incentivized CGM are and Ascensia. new Eversense inserters the commercial patients demand. The new are dedicated activities U.S. former existing Head U.S. to of and ADC to to growing certified to reps number marketing in the the team the support excited with We're also sales patient for increase Rudy to pleased Senseonics readiness swift and have the EX lead Thoms, hired Sales, patients and they

CGM awareness in use, EX generating the diabetes Eversense promotes up active overall As tool across campaign highest leverage This prescription advertising are product and there the digital to part with to geographies effective availability ability the population insulin awareness, familiarity has proven for of inserters. through ramped would and has they the coverage concentrations, to specific patient direct-to-consumer the efficient ADC platforms. largest increase broad in U.S. to and geographies where other algorithms media launch DTC at currently and and Since like exist community continue and scale. leads the for the choose the Facebook be an Eversense where advertisements promote channels. patients the targeting These efforts advertising have social

this with the generating We generation. is that approach lead early are positive indications and pleased targeted impressions

was conference was major was ADC team in conferences. participating traffic deeper to engagement. very again in many product. days improvements managers attendees XX providing The Eversense. opportunities symposium. Spain ATTD interest busy diabetes we as Senseonics the understanding were person. and gaining diabetes pleased demonstrated and industry demonstrations, front, marketing to live interact both them and professional Booth was the product high in with robust pleased strong community EX the with Energy actively meetings and meet incoming Clinical The product are the to all were engagement HCP with just HCPs at was of successful the in and On ago excited the the XXX-day training introduce with as to a

We to June. diabetes to introduce year, EX the upcoming highlighting ADA year X in on XXX-day value share posters the at This and the new HCPs the supports presenting and Meeting of booth significant from the a data presentations implantable our presence of clinical ADA X Annual our the also have and that to opportunity great clinical is this plan largest first conference system data, including be pilot hall proposition sensors. will long-term of exhibit CGM. a theater, a product there floor data the EX, the At a our

from access, engaged ADC patient the EX transition and payers actively mechanisms payment sensor. XX-day to Regarding coverage with is

of patients pleased with inclusion of EX some Aetna our to progress both Medicare are commercial well government the EX. We solutions interim to the our obtaining delays ongoing, of or XX-day early previously we are ADC's sensor such value strong and covered for as have limitations Positive as with will implantable payers immediate recognize confident and proposition CGM. as are Humana's ensure will discussions and no the continue

As Ascensia an Eversense. to patients is described maximum this that out-of-pocket is adoption believe last increase assistance base. for in the commercial first offers an a patient we updated very enticing EX sensor. the EX patient a attract any $XX and to implemented that coverage has investment We insurance cost Ultimately, program for should to call, with program their this drive user

for of new other patients on expect benefits systems the CGM and to product the try users We to to to convert Eversense.

CGM co-pay expenses are providing touch HCP then EX changes to Following investments assistance required options access. per patient Europe, and to sensor, experience a with ongoing and In for implementing the first Ascensia out-of-pocket limited patient's provide support month to their strategic important is higher commercialization. $XXX

several Ascensia organizations. has the the past various sales national by country been weeks attended holding conferences commercial

Germany, to an control dedicated directly of sales sales an to During launch and support internal making focused to while these patients initiatives. an Eversense continues levels Eversense. the transition of insertion includes reliable visibility EX This support. targeting to resources increasing and prescription model In process training. distribution meetings, specialist and enable provide greater indirect from they ability to designing to provide and These from preparation team are changes patient the Ascensia

Ascensia market competitive their experience Another process based countries, tender serving being is on the in preparation important to successful with Eversense. optimize of tenders different with the aspect European and continues

Now bring be mark. continue to launching point, to to as this research To body encouraged final our strides we clinical end, in currently in transitioning and sensor to continues well. by move product launches to as the regional on progress testing of Human pilot new enhanced underway, this and we attributes The towards is performance XXX-day year performance. the support to preparations notified their CE EX review make product product our our our configuration EU to underway anticipate innovation. users. system early continue development Europe European is X-month we the country where to and by quarter. full the under third the we pipeline, product this At are in achieve CGM The EX advance

year. encouraged of at XXX-day create pilot Additionally, we our end progress chemistry anticipate currently by ready battery partner a clinical implantable to would and demonstrated our we've the version positive us of testing this are swipe This design with pair implanted for sensor battery battery system. allow XXX-day or to being

are Nick updates on our the the this results. looking to We targeted and quarter call like product people the over on would I on-demand an and to innovation turn the of product to over to progress committed freedom of to first with to flash of to further look financial implantable forward range our flexibility future for go calls. now deliver details providing

Nick Tressler

the to revenue first everyone. was the $X.X of Thank year net gross outside quarter period. with million line total Gross Good in year million. $X.X revenue prior profit revenue $X.X Tim. the was of QX for profit U.S. was afternoon, you, was million, compared $X.X the and $X.X U.S. first In XXXX in the million $X.X prior in million million quarter period. XXXX, in

$X.X our general clinical due to supplies of the expenses increasing prior increase the year quarter million million, fees studies, The the increase expansion payroll were increase of further result $X.X was to of head year period. development of was product XXXX were to expenses our lab million and $X.X an primarily in million an First The and advance compared to XXXX count QX R&D increase the million, administrative and and primarily professional period. in million and increase compared selling, $X.X in pipeline. $X.X outside prior expenses related expenses. increased and $X.X in an Research

noncash excuse the to the March For price quarter significant to end fourth the first price gains to of end $XX.X share loss XX, operating XXXX decline the of in was compared million months led company's 'XX, share XXXX of million quarter the in $XX.X XXXX, as quarter the loss of at QX. first ended of The X compared -- me. in company's the at the

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

accounting As values accepted period charges the to price. as required these by mark principles gains these in are the generally value quarter, Each recorded the each of will volatility instruments reporting we share vary on change the of noncash income in for the market or U.S. noncash GAAP, these based to statement. value losses or company's the and

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

or to income the of XXXX. derivatives loss adjustments by million million $XXX.X value compared a was due and increased to million Net the per for March embedded income share quarter $X.XX For share months X net net XXXX, total previously $XXX.X per $XX.X accounting $X.XX of in the fair mentioned. first or ended XX,

As XXXX, of March $XXX.X cash, cash long-term investments short million. totaled and equivalents, XX,

Turning to for our XXXX. outlook

XXXX revenue be net of to We global communicated previously. expect $XX $XX million full we range to our the million continue to year in

to transition in breakeven the payer policies As fourth XX-day approach occur the coverage of quarter. margins gross product, expect the we from to X-month

cash year million. full $XX in XXXX, used net operations million to to the is projected the For of range in be $XX

our IDE turn and product for expect clinical back the will additional be that, expenses start pivotal to for Tim. to subject in XXX-day majority With trial, in I ongoing of call including XXXX products approval. We feasibility the research pipeline, for and trials the of development to pivotal the

Timothy Goodnow

Thank you, Nick.

people the Europe to This quarter waiting across product product, of the U.S. and lasting improved excited quarters. patients product coming system. providers advancement next exciting As with an a the of in we been version of is launch to believe to transition the we our commercial diabetes, diabetes eager into the them and the are are have we longest rollout our through CGM bring and providing in of an management. now continue world's We product our in EX such generation for expected X-month the benefit second

impact Officer. the call joining by has our a compelling collaboration Operating our us questions. newly force open commitment along We are meaningful people our Also is we'll you Together, with this is the With them dedicated to and a commercial with invest U.S. launching turn pleased they ramping make Ascensia's their and and support CGM questions partnership to product the Thank potential CGM drive the and today. to demonstrates your time to Jain, investment for call our diabetes see that, bringing Chief awareness up Q&A. prepared building organization positive for year, concluding to Operator, Mukul Eversense unique let's the product access as the for in a remarks, This for our sales product. for dedicated solution. and for

Operator

first Instructions] Blackman from comes [Operator with Mathew Stifel. question Today's

Colin Clark

on to I leading with outlook? beyond start days, launch. what weeks that the commercial or you wanted commercial traffic, interest? it's for tracking, whether metrics the confidence but X of early the share you can is in Obviously, Matt. first are indicators XXXX EX you website it's patient anything new there This Is gives physician Colin adds,

Timothy Goodnow

which physician had information DTC meaningful. generate leads and as it's the course, very encouraging on ramped we interest, by by is, has of Ascensia, anticipated, based for meaningfully and patient Yes. it's very Frankly, higher really request they driven is Colin, the we than the news. noted. that

as see that well patients, the were for professional do rise we waiting the notable many that being as certainly the that doctors in the XXX-day Additionally, a doctors treat through launch. interest channel,

interest and is So positive well. as their for important us

Colin Clark

with opportunities. Great. And you way stepwise each the product? of a addressed market you've market the size in maybe there talked to frame being penetration about opportunity duration the those and XX-day a advancement expansion, you any relative market could Is EX

Timothy Goodnow

that anticipate haven't number are as big in to. There from certainly in that benefit it. certainly a are can about participated interest CGM have it Eversense market, of folks a is are on need they growth. even you are aware. X/X CGM the We we significant people people before that though of that not It Well, still see being

both share So there about is we from players, as know the global that existing yet. well you expect billion aren't which will $X a people it transition be the of growth a market, on that as

to it So notable. we be look at

Operator

BTIG. from [Operator Marie comes with Instructions] Thibault Today's question next

Sam Eiber

Eiber commercial Maybe It wondering you additional color on Marie. I sounds could EX? Sam just wins here. any timing maybe maybe for start pace some to both like of additional with is we here or Medicare. was provide conversations This some transitions the can and of payer on expected if early on

Timothy Goodnow

Sure. We continuum. as at a look it

with had and You to putting allow folks months XXX-day conversations next early did Medicare some others process we product. We active anticipate that of immediately. place very patients. well. quickly be couple are and right some do Aetna to XXX-day see like us in the We've the over the saw wins plans that we they'll that that the will Medicare, went had Humana in as for in product There are transition very the to

do payers we it so. the quarter or fourth recognize done, be next quickly the it or quarters. of But as that get in couple expect updates, happen we and are of the do expect quarter we it as X. majority to So some it, fairly transition do that the But fully late next may to annual do in there

Sam Eiber

or there be roll maybe those worked where of to great on Or have is a out? programs maybe one assistance start will amount I certain to off? still to patient coverage the that more threshold here a Great. Is a And could That's you'll there where hear. ask program. maybe time

Timothy Goodnow

it do patients We anticipate the that are sensor trying this point. using for the first at

to you some So need form do commercial coverage. have of

coverage, for not rest months the candidate Obviously, X be that They'll year. this this second patient do assistance program. the to of product. anticipate on and go monthly other, to we we cap have for you the So that comes now do expect if the a a there'll through where from absolutely you're no in. transition But sensor

program here to the in second So put expect of the remainder all -- quarter, potentially QX in the fourth patients happen the half to and new year. start and patients the QX throughout of on it continuing while roll reinserted to in to

Operator

And Nowak comes question today our next from Craig-Hallum. Alex with

Alex Nowak

was implanting HCPs And number what U.S.? Just the launch, over? And the into physicians how I of latest just ultimately is just for X be XX% the in to be in guess we're know to needs over? addition weeks XX-day those much convert that coming to out the here have X%, converted the about training only sensor done XXX-day, I

Timothy Goodnow

about XXX no the currently XX me, Alex, is to that's So process, medical the really about exact dimensions -- from required. required no are same to XXX. are go professionals and to excuse difference that sensor to XXX do from there's the -- the It's There there's insertion. tools training that trained additional and

to So it's an one automatic other. transition the from

Alex Nowak

then on give And the at partner. inventory maybe situation update it. Got your an us

the ultimately how is inventory approved the in days, QX, many curious Just sales are up inventory the we XX-day QX, into factored QX? ultimately the for once into there, Ascensia. get how the XXX then sitting European EX then that how step older sensors also And that U.S. and being does -- at

Timothy Goodnow

Yes.

So QX the guidance We've where QX. as I do some occurred really here until didn't were QX. been down that's the EX into QX. know early we we in product it starting the new as of I we -- active coming. beginning Europe, and market we've we very Similarly, is noted. the in that that the product XX, there in the anticipate fact Which was That very running transitioned, put XX-day said, fully the is The will be in transition. And with softness part was given. of

we too the actively are down many Europe the inventory down that taking XL in level So so XXX-day EX. transition for that weeks here can not product begin to in current -- we

Alex Nowak

then the not planning about human doing planning on Is are you sound there? in some like bio might here also, so half, And XXX-day testing, then the submission maybe that the Helpful. still necessarily you that's It you Okay. be pivotal? when needed. sensor, still on IDE And to are second QX? launch did

Timothy Goodnow

Yes.

date So the we anticipate as and remains, do filing, first inserting IDE still the likely noted, quarter the fourth in you patients.

So those are...

Alex Nowak

-- up the burn. the perfect. how ramping here the QX And lastly think cash QX, and just to with course low being to of just How Okay. -- kind watermark QX, on about year? the over EX of just And then think about burn cash

Timothy Goodnow

anticipating to OpEx. as about said, think million we're I Nick $XX Well, $XX million of

bit just just over it's million month. So $X per about -- little a

Operator

concludes And for question-and-answer I'd to ladies the to final the like and back conference turn any gentlemen, over management this session. remarks.

Timothy Goodnow

to Great. time their and product initial thank are Well, everyone again want here encouraged to for I today. EX new excited the results. have very by We're the

both in We have in in U.S. XX-day ramping the a to the transition here here the XXX from in continue and QX Europe to focus

So next to you. support updating Have quarter. look forward appreciate day. good and everybody's a Thank you

Operator

This concludes all call. for today's presentation. attending today's you thank We conference

now You and day. lines, a have your may wonderful disconnect