Alimera Sciences, Inc.
Q4 2015 Earnings Call Transcript

Published: 3 Mar 2016

[Operator:]

Greetings, and welcome to the Alimera Sciences Fourth Quarter 2015 Results Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the presentation [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rich Cockrell. Thank you, Mr. Cockrell, you may begin.

[Rich Cockrell:]

Thank you, Brenda. Good morning everyone and thank you for joining us today for the Alimera Sciences’ fourth quarter and year-end financial results conference call. With me on the call today are Dan Myers, Chief Executive Officer and Rick Eiswirth, President and Chief Financial Officer. Yesterday evening Alimera Sciences was pleased to issue a press release announcing fourth quarter and year-end 2015 financial results. Today’s call is being webcast, and will also conclude a slide presentation which has been posted for the company’s website. Following the remarks by management, the call will be open to your questions. Now during the course of this call management may make certain Forward-Looking Statements regarding events and the company’s future events and the company’s expected performance. These forward-looking statements reflect Alimera's current perspective on existing trends and information, and can be identified by such words as expect, plan, will, may, anticipate, believe, should, intend, and other words of similar meaning. Any such forward-looking statements are not guaranteed of future performance and involved risk and uncertainties. These risks are described in the risk factors and Management Discussion and Analysis section of financial conditions of Alimera's annual report on Form 10-K for the fiscal year ended December 31, 2014 and Alimera's quarterly report on Form 10-Q for the quarter ended September 30, 2015 which are on file with the Securities and Exchange Commission and available on the SEC’s website. Additional factors may also be set forth in those sections of Alimera's annual report on Form 10-K for the year ended December 15, 2015 to be filed with the SEC in the first quarter of 2016. In addition, any un-audited pro forma financial information is preliminary, and does not purport to project future financial positions or operating results of the Company. Actual results may differ materially. For the benefit of those of you who may be listening to the replay, this call was held and recorded on Thursday, March 3 at approximately 10 AM Eastern Time. Since then Alimera may have made additional announcements related to topics discussed herein. Please reference Alimera's most recent press releases and current filings with the SEC our forward-looking statements contained statements contained in the presentation are expressly qualified by the cautionary statements contained or referred to in this presentation. Alimera cautions investors not to rely too heavily on the forward-looking statements it makes or that are made behalf on its behalf. These forward-looking statements speak only as of the date of this presentation. Alimera undertakes no obligation, and specifically declines any obligation, to publicly update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise. Alimera declines any obligation update these forward-looking statements except as required by applicable law. Now with that, I would like to turn the call over to Dan Myers, CEO of Alimera.

[Daniel Myers:]

Thank you, Rich. It doesn't seem possible that one year ago we were launching our commercial organization in the U.S. In 2015, we expanded to the point when more than three times as many patients had access to ILUVIEN our intravitreal implant for Diabetic Macular Edema. In 2015, we achieved record sales of $23.4 million, a 167% increase in revenue over 2014 with $15.2 million being attributed to sales in the U.S. and $7.3 million to sales in our international segment. This growth is primarily attributed to our launch in U.S. where we built our sales infrastructure early in 2015. ILUVIEN was also launched in Portugal and was successfully re-launched in Germany. Furthermore, we expanded our opportunity for the further of availability of ILUVIEN in additional markets by entering into partnership in Canada, Italy and the Middle East. In the fourth quarter of 2015, we realized a 241% increase in revenue over the same period in 2014, yielding a $5.8 million net revenue, U.S. sales accounted for $3.9 million of that revenue international sales or $1.9 million in the quarter. notable highlights in the quarter included the granting of the permanent J-code in the United States which became available on the January 1, 2016. In Germany, we saw the continued growth of ILUVIEN sales with fourth quarter unit sales matching our previous best quarter. We expanded our opportunities for growth in significant DME markets by partnering with MEAgate International, headquartered in the United Arab Emirates to distribute ILUVIEN throughout much of the Middle East where the diabetic population is significant. We believe the availability of ILUVIEN’s J-code have a significant impact on our business in 2016. This code a permanent code that identifies ILUVIEN specifically in the reimbursement process has led to the unlocking of the certain accounts that were close to us in 2015 due to reimbursement concerns. It is also resulted in the substantial uptick and benefit investigations referred to as BIs in the first quarter of 2016. As a matter of fact, BIs for new patients year-to-date 2016 have already exceeded total fourth quarter BIs for new patients in 2015. We see this investigation as a leading indicator of interest in ILUVIEN as it represents true patient identification for retinal specialists. While the demand creation evidenced by BIs has been encouraging, the conversion process to actual injections in the first quarter is taking longer than anticipated resulting in lower monthly sales. In addition to driving this demand, our sales representatives are working with physician offices to ensure these patients are scheduled and treated. As of December 31, 2015, our U.S. sales forces has grown to include 37 sales executives. We've added additional headcount to increase our presence with key accounts. We closed 2015 with 312 accounts having purchased ILUVIEN in the U.S. prior to the activation of the J-code in 2016. In our international segment as a whole, Q4 unit volume was 7% higher than in the same period in 2014. Result response in Germany, which is delivered 53% increase in volume compared with the same period in 2014. We continue the broaden inclusion of ILUVIEN in reimbursement contracts, and are very pleased that Germany is once again our largest source of revenue in our international segment. Portugal finished 2015 with record quarterly sales. This small thus significant market was a challenge from market access perspective. However, by the end of quarter four we executed contracts and more than 50% of our targeted accounts thereby significantly increasing coverage of the DNA population. It's this access to funding that has led to the strong results we saw in the quarter and we look forward to further increasing the level of access during 2016. As expected the increased competition following the NICE approval reimbursement for Ozurdex and EYLEA for the treatment of DME, resulted in a slowdown in UK sales that continued in quarter four. The slowdown we have experienced is directly related to the consideration by EYLEA and Ozurdex guidance and they are placing UK treatment algorithms for DME. We believe we'll absorb this slowdown and return to growth in UK in 2016 for two reasons. First with respect EYLEA, data from the recent DRCR.net's protocol T 2-year readout indicated there are no significant differences and outcomes between the licensed anti-VEGF treatments. Therefore, the number of patients insufficiently responsive to these treatments will not change. Second, with response to Ozurdex we believe the emerging real world data indicates that ILUVIEN performs better to or equal to than it did in the same study. This correlation has not been observed with Ozurdex. With that I would like to turn it over our President and CFO, Rick Eiswirth.

[Richard Eiswirth:]

Thank you, Dan. Thank you, all for joining us today. Consolidated net revenue increased by approximately $4.1 million, 241%, to approximately $5.8 million for the three months ended December 31, 2015, compared to net revenue of approximately $1.7 million for the three months ended December 31, 2014. Consolidated net revenue increased by approximately $14 million or 167%, to approximately $22.4 million for the year ended December 31, 2015, compared to net revenue of approximately $8.4 million for the year ended December 31, 2014. These increases were primarily driven by increased sales of ILUVIEN in the U.S. following our launch in the U.S. in the first quarter of 2015. Fourth quarter 2015 revenues were affected by seasonality, as well as some U.S. accounts deferring treatment of patients into 2016 to take advantage of the newly announced J-code. We believe that the specific J-code reimbursement will drive additional use and reduce some reimbursement concerns from U.S. practices in 2016. U.S. net revenue was $3.9 million in the fourth quarter of 2015. For the year ended December 31, 2015, U.S. net revenue was approximately $15.2 million. U.S. net revenue in 2015 was a result of the commercial launch and use of ILUVIEN by retinal physicians. There were no significant ILUVIEN sales in the U.S. in 2014. Our International revenue increased by approximately $200,000 or 12%, to approximately $1.9 million for the three months ended December 31, 2015, compared to approximately $1.7 million for the three months ended December 31, 2014. The increase was primarily attributable to unit sales in Germany, offset by lower sales in the UK and the impact of decreases in the value of the British pound sterling and the Euro. International net revenue decreased by approximately $1.1 million, or 13%, to approximately $7.3 million for the year ended December 31, 2015, compared to approximately $8.4 million for the year ended December 31, 2014. The decrease was primarily attributable to a decrease in German unit sales and decreases in the value of the British pound sterling and the Euro, offset by incremental sales associated with the commercial launch of ILUVIEN in Portugal in 2015. Consolidated gross profit increased by $3.8 million, or 238%, to approximately $5.4 million for three months ended December 31, 2015, compared to $1.6 million for the three months December 31, 2014. Gross margin was 93% and 94% for the three months ended December 31, 2015 and 2014, respectively. Consolidated gross profit increased by $13.7 million, or 196%, to $20.7 million for year ended December 31, 2015, compared to approximately $7 million for the year ended December 31, 2014. Gross margin was 92% and 83% for the years ended December 31, 2015 and 2014, respectively. Consolidated research, development and medical affairs expenses for the fourth quarter of 2015 increased to approximately $3.6 million, compared to approximately $3 million during the fourth quarter of 2014. Research, development and medical affairs expenses for fiscal year ended 2015 increased to approximately $14.8 million compared to $11.8 million during fiscal 2014. These increases were primarily due to the hiring of medical science liaisons and expanded scientific and medical communication in 2015 to support the U.S. commercial launch of ILUVIEN and ongoing post marketing studies of ILUVIEN. Consolidated general and administrative expenses remained flat for the fourth quarter of 2015 compared to the fourth quarter of 2014 at approximately $3.7 million. Consolidated general and administrative expenses for year ended 2015 increased to approximately $14.2 million, compared to approximately $12.4 million during fiscal year 2014. This increase is due to the growth in our infrastructure to support our global business. Consolidated sales and marketing expenses increased $1.8 million, or 34% to approximately $7.1 million for the three months ended December 31, 2015, compared to approximately $5.3 million for the three months ended December 31, 2014. Consolidated sales and marketing expenses increased $13 million, or 86%, to $28.1 million for the year ended December 31, 2015, compared to approximately $15.1 million for the year ended December 31, 2014. This increase in expense was primarily related to our investment in the U.S. commercial launch team that supported ILUVIEN in the U.S. GAAP net loss applicable to common stockholders for the three months ended December 31, 2015 was approximately $10.7 million, compared to approximately $10 million for the three months ended December 31, 2014. GAAP basic and diluted net loss per share for the fourth quarter of 2015 was $0.24 per share on 44.6 million weighted average shares outstanding, compared with GAAP basic and diluted net loss per share of $0.23 per share on 44.3 million weighted average shares outstanding during the fourth quarter of 2014. GAAP net loss applicable to common stockholders for the year ended December 31, 2015 was approximately $30.6 million, compared to approximately $36.7 million for the year ended December 31, 2014. GAAP basic and diluted net loss per share for year ended December 2015 was $0.69 per share on 44.5 million weighted average shares outstanding, compared with GAAP basic and diluted net loss per share of $0.91 per share on 40.4 million weighted average shares outstanding during the year ended December 31, 2015. As of December 31, 2015, we had cash and cash equivalents of $31.1 million, due to less than expected sales of ILUVIEN in January and February of 2016, we are not currently in compliance with the revenue covenants of our debt facility with Hercules Technology Growth Capital. Hercules has not accelerated or otherwise made demand for any amounts owing under this agreement. We are currently discussions with Hercules regarding an amendment to this debt facility, which would bring us into compliance. We are currently anticipates continues amendment prior to the filing this month of our Annual Report on Form 10-K for the year ended December 31, 2015. With that, I’ll turn it back to Dan for closing comments.

[Daniel Myers:]

Thanks Rick. We increased the impact of ILUVIEN 2015 by launching in the critical U.S. market and progressing in current European countries. While we waited for the opportunity to expand organically into additional international markets, we have aligned with proven commercial partners where it makes sense to do so including in the Middle East. We continue to believe that the DME market is underserved by under treatment and recent studies consistently report that 35% to 50% of patients failed to gain significant benefit from treatment with anti-VEGF therapies. As I have already said, very recent data from the DRCR.net Protocol T confirms that at 24 months, there is no significant difference between approved anti-VEGF therapies for DME. There is a clear need for further effective options like ILUVIEN. Our road forward is challenging, as we are establishing a paradigm change, bringing the only long-term continuous delivery implant to this larger population of patients who require persistent treatment of this disease. Each day we are more and more encourage by the real world data that we are seeing. The data supports both the safety and efficacy of ILUVIEN. We are excited about future, which includes planned presentation at key ophthalmic meetings this year, where we plan to share new data including as early as this May. We look forward to sharing those and other units on our next call in May and I thank you for joining us today and for your interest in Alimera Sciences. I’ll now the cal over to the moderator to be in our Q&A session.

[Operator:]

[Operator Instructions] Our first question comes I’m the line of Caroline Corner with Cantor Fitzgerald. Please go ahead with your question.

[Caroline Corner:]

Hi guys. Thank you for the color today. So looking at your January and February revenues, you mentioned that they came in a bit lower than expected. You mentioned that converting customers to the actual injections after they have signed up for an injection is taking longer than you thought. Can you talk us through a little bit what's happening there, given that these patients are going blind. They have already deferred some injections from 4Q into 1Q, but are why we not pulling the trigger and actually getting these injections done? And then can you also talk a little bit about what you are going to do in order to change this, to actually drive the injections to actually happen?

[Daniel Myers:]

Sure. So Caroline, unfortunately the answer to that question is somewhere it depends, because that’s variety as to what happens out there in the work place. You have some physicians that will submit a benefit investigation, get that benefit investigation completed under week. And schedule that patient to come back in and treat them for the DME with ILUVIEN right away. In other circumstances, you have physician that determines that they would like to use ILUVIEN on patients. They will submit benefit investigation, but he does it when they make that determination, they will inject that patient with an Ozurdex or a EYLEA or a Lucentis and those patients they are therefore treated for two to three months, four months on the outside, depending how far the doctor wants to stretch out the treatment with Ozurdex. And then that patient gets injected. So we think that the average time is somewhere between two to three months in order to take to get that converted. We are looking at better ways to make sure that each one of our individual reps can track the open BIs that they have within the HIPPA rules and the privacy rules we have for patients but allowing those reps to track deals in BIs, so that they can be following the practices to make sure that those patients are rescheduled on a timely basis.

[Caroline Corner:]

Okay, thanks. And then you said that you have 312 accounts open as of the end of the year before the J-code was in place. That was up from, I think, about 160 in second quarter. So that's solid progress there. How many accounts total do you see? And was the J-code as you see it, is that a big gating factor for open end accounts?

[Richard Eiswirth:]

You know we think there is somewhere between a 1000 and 1500 accounts probably out there that we would be targeting, so you know there is probably 20% or 30% penetrations depending on how you want to look at that. We did have some accounts that opened up, they actually called us proactively after January 1 that had withhold treatment of the J-code. I don’t want to mislead you and say that that's a huge number. You know more of it is us going back and approaching those accounts for J-code who decide it's an issue and pushing those. We have seen an increase in accounts in January and February so we do think that continuing to grow and some of that is the impact of the J-code.

[Caroline Corner:]

Okay and then this is the last one for me

[Richard Eiswirth:]

You know Caroline, we have never given guidance on what we thought the peak would be although when we are featuring number. I don't think anybody here at Alimera has their enthusiasm dampened for the long-term prospects of this product. We do have the advantage of knowing that this product works and we get anecdotal evidence from doctors and patients in the field on a daily basis of success stories with ILUVIEN. It is taking a little bit longer than we wanted it to because some of the challenge on reimbursement and we just simply will higher price for us and we are facing competition in the marketplace. But we think we will get there. We are determined to manage the company to breakeven EBITDA in the fourth quarter of this year, and that's the challenge we have in front of us, we're very focused on Europe. And we do think that the demand from the BIs that we've seen over the course of January and February that Dan alluded to exceeding what we saw in the fourth quarter is a good indication that demand is there and we will be able to grow sales throughout 2016.

[Caroline Corner:]

Okay, great. Thank you very much.

[Operator:]

Our next question comes from the line of Boris Peaker with Cowen & Company, please go ahead with your question.

[Boris Peaker:]

Good morning. I want to explore a little bit more about this compliance with debt covenant. Could you comment, how far away were you from it, and what are the conditions in the debt agreement if the covenant is not met?

[Daniel Myers:]

Well Boris we haven't disclosed the specific guidance and projections we've provided Hercules so we're not prepared to do that on this call. I just did say we obviously, missed our own internal projections that we shared with Hercules there. You know the reality is Hercules does have all the remedies, many remedies they could effectively call the data if they chose to do so. As we stated in the call they haven't done that and we sort of have an agreement to work forward the next ten days before that K is issued to complete that renegotiation put us back in compliance.

[Boris Peaker:]

I see. So is there a monthly check, so for example, in March and April, could they wait to see those numbers, or you need to basically resolve it based on just January and February data?

[Daniel Myers:]

Historically there has been a monthly check, but part of the amendment we are working will address that perceptively.

[Boris Peaker:]

Got you. And also just from a patient perspective, are you getting patients that were previously treated on Ozurdex, or I guess what fraction of patients who are on ILUVIEN have been previously on Ozurdex, versus new to a delayed steroid?

[Daniel Myers:]

We certainly are getting patients that have been on Ozurdex before, I think that there are certain physicians out there that may use alternative steroids as the check or the test to see if how a patient might respond from an IOP perspective to steroid before to treat with ILUVIEN. But through the foreseeable future I think the assumption is that the vast majority of patients will have received an Ozurdex or more than one Ozurdex before they are on in ILUVIEN.

[Richard Eiswirth:]

You know Dan alluded to earlier how we're definitely seeing a shift in the marketplace of physicians being able to earlier identify patients that is not responding efficiently an anti-VEGF therapy and doctors are making that change faster. We're certainly seeing that in Europe and beginning to see some of that trend in the U.S. I think we will continue to face the same challenge with Ozurdex for a while and that physicians may want to do multiple Ozurdex and we need to work on getting them to make that switch sooner. As Dan also alluded to in his comments, we believe the data out in the marketplace and data continues to emerge indicates that Ozurdex simply doesn't drive the same level of efficacy as ILUVIEN did in its clinical trials or does in clinical practice and that we will eventually be able to convert those doctors on a earlier time schedule.

[Boris Peaker:]

My last question is you mentioned that there were some I guess warehousing patients for beginning 2016 due to J-codes coming online. Curious…

[Richard Eiswirth:]

Yes, we do know that there was some deferral in the fourth quarter our physicians either giving us a benefit investigation in a month of December and saying not to run it until January when the new insurance benefits would be in place. And we also add some resubmissions from physicians who had identified a doctor and submitted a benefit investigation in October, November or December and because of the lag I referenced in speaking with Caroline, those patients rolled over in 2016 and they resubmitted a new benefit investigation. So we do know that there is a substantial number out there that we're in the process of trying to convert.

[Boris Peaker:]

No, I understand that. But my question was, do you have a sense in terms of sales revenue, how much was rolled over into 1Q from 4Q, that otherwise maybe would have been captured in 4Q if not for this J-code coming up?

[Richard Eiswirth:]

It would be an estimate Boris and I don’t we think we're prepared to try to estimate that on this call today.

[Boris Peaker:]

Okay. Great. Well, thank you for taking my questions.

[Operator:]

Thank you [Operator Instructions] Our next question comes from the line of Jim Molloy of Laidlaw. Please go ahead with your question.

[James Molloy:]

Hey guys, thanks for taking my question. I was wondering, could you talk a little bit we're here into March, almost through the first quarter on the trend in the fourth quarter due to the issues that you addressed about the J-code, and obviously down 22% quarter to quarter. Not what you're looking for. Is that a trend that's continuing in the first quarter, or has that changed or is it flat? Any trend compared to the third quarter or fourth quarter trend last year?

[Daniel Myers:]

Jim, I can't answer that from a BI standpoint. As Rick said, we're not prepared on this call to give guidance into the first quarter on a revenue basis, but as you look at BIs, which have traditionally been a leading indicator for us. The January, February has been very encouraging as related to BIs coming through, some of that J-code kind of as Boris mentioned, warehousing, if you will. But if just take new patient BI which is of course the demand created by we think our sales force being in the office and the issues of the permanent J-code. We've certainly see an uptick of new patients over the previous quarter in addition of course we've got the lag of patient who came out in January. So right if you look what we think is kind of the leading indicator of demand from that standpoint we're pretty close to what we expected to see as demand in January and February, so that's the good news. As I said earlier, and Rick has reiterated, the conversion of that "demand" that's pretty much on track where we expected into actual revenue has been a little bit slower than we anticipated. So I guess if I look at the quarter without getting into the actual number right now I think we feel pretty good about the demand creation for our expectations, but certainly we have to confess that we were little more optimistic that with the permanent J-code the system will be more fluid and you would see those patients moving through with a less of a lag time. As Rick said, it's still taking somewhere between two and three months for a BI to become a sale and so of course that makes it very difficult and kind of wildcard for the quarter, how many of those BIs had built up in January and February that look pretty encouraging will actually occur into - or turn into sales that occur in March or a drift into April, which of course has an impact on whether that's a first quarter sale or second quarter sale. So yes, I almost think we have to kind of see that effectiveness over the course of the two quarters, because you could see movement from the quarter of the March and the third quarter of April that you would argue is sort of first quarter demand, but may not be reflected in revenue till even March, or April or May.

[James Molloy:]

Thank you. In the fourth quarter last year, did the non-deferred BIs, you mentioned a lot of BIs said, hey, wait for the benefit of the investigation, and don't activate it until January because I want to wait for the J-code. But the actual BIs that came in and weren't waiting for the J-code, were they down sharply in the fourth quarter in line with ILUVIEN. I guess I'm trying to get an idea of how, historically over the last year, how indicative have the BIs been of sales pull-through?

[Richard Eiswirth:]

Jim, I would say that October and November were pretty consistent with what we've seen earlier in the year, you did see a very sharp tail off in December, which I think generally as what we said about fourth quarter was a result of both the seasonality and physicians wanting to wait to inject into the January and February with the J-code. So you did one see a tail off in December.

[James Molloy:]

Got it. Thank you. And then in the real-world experience, it's been out there for a year now, I know you mentioned previously in the real world it seems to be working better than in the trials. How has the incident of IOP been in comparison to the trials, so the incidence of the surgery to correct IOPs, as compared to in the trials over the last year?

[Daniel Myers:]

Well yes and that's one of the comments I made about trying to get a lot of the real world experience has been very positive, Europe into the U.S. and we're going to begin that with the Royal College of Ophthalmology presentations in May. That was my reference earlier. And how much of that we can stay in compliance with the U.S. of course bring in to the U.S. market I think is a real critical piece of our marketing over the next six months. But to answer your question specifically, we now got over 4,000 injections globally, maybe 60% of that or so in the EU. And at this point in time we still only have reported or had reported to us two incidence of filtration surgery or glaucoma surgery that some people like to call which if you remember in our trial and what some of our competitors and so U.S. doctors continue to reference was about 5% in the FAME data set, of course reminding you that the same trial was done back in 2005 through 2008 and of course we know a lot more about DME and how to treat DME now almost a decade later. So we still remain very encouraged that the actual incident rate of glaucoma filtration surgery, which at the end of the day is what the doctors are most worried about. I certainly know managing IOP is a concern and retina specialists will have to grow to learn how to manage IOP. I think it's just the way of life as we move forward looking at the treatment paradigm or of steroids now being applicable to DME. We're going to continue to grow and learn more about managing it. I think when you talk about this specific in the U.S. they are concerned about the incidents of glaucoma surgery and we continue to be very bullish and that at this point in time now after two and a half year launch, we still have only had two filtration surgeries in the world. So I feel very good about the safety profile as it relates to the surgical procedures.

[James Molloy:]

Two out of 4,000 is certainly lower than 5%. That's a good number.

[Daniel Myers:]

And Jim let me just to conceptualize that that as we fair, not all of those patients have been completed two to three-years, now we have 100s of patients who have completed three-years, certainly the two incidents where are that early group. so while one could suggest that we have 4,000 injections not all of them have been exposed to the treatment of a steroid for three-years and still even if its two cases out of just several hundred, we still feel very good about that. But clearly we want to keep watching that but I think early on right now we feel very bullish.

[James Molloy:]

Excellent. And Rick, you had mentioned the fourth quarter you're expecting to be EBITDA breakeven by fourth quarter 2016 if you hit your internal projections. What does that say about your expenses? I mean, your R&D up about $4 million from the prior year. Can you walk through, are those going to stay consistent G&A sales and marketing, do they need to move dramatically, stay roughly where they are, if you hit your numbers? Can you walk through what gets spent on R&D, what the $14.8 million is being used for?

[Richard Eiswirth:]

Yes, I think overall what you'll see the expansion run rate that you're seeing in the fourth quarter which is fairly consistent with what you saw in the third quarter will stay about the same for 2016. The R&D spend is really a lot more on the medical affair side of things right now, it's medical science liaisons and scientific communications, developing communications in the field to support building the knowledge base of ILUVIEN. It's the things in the discussions that our medical team can have that our sales rep can't have out in the field to drive the awareness of ILUVIEN. It's also the 800 patient registry study that's being run in Europe as part of the regulatory requirement there, but it will also provide some real world evidence over the course of 2016. And it's also the PALADIN study where we are looking at what the side effect profile of an ILUVIEN looks like after that prior course of corticosteroids.

[James Molloy:]

Great. Thank you very much for taking my questions.

[Operator:]

Thank you. And next is a follow-up question from the line of Caroline Corner with Cantor Fitzgerald. Please go ahead with your question.

[Caroline Corner:]

Hi guys. So just looking at that two to three month lag that you talked about, when patients are coming in and getting treated with something else while they're waiting for the benefits investigation, that makes sense and explains why we would see a bit of a delay. But when do you feel like you'll be comfortable giving us revenue guidance? When do you think this is going to shake out where you'll be able to predict actual adoption? Should we expect to get some revenue guidance on the July call, or what are your thoughts there?

[Richard Eiswirth:]

I would probably say it's more likely going to be a July call before we consider doing that at this point.

[Caroline Corner:]

Okay. Thanks. That's helpful.

[Operator:]

Okay, thank you and this concludes the question-and-answer session. I would like to turn the floor back to Dan Myers.

[Daniel Myers:]

Yes. Well thanks again for your attendance on the website and the call. I appreciate the questions and the opportunity to explain further how our performance and our excitement going forward. We look forward to our earnings call in May and giving you further update on progress of ILUVIEN. Thank you.

[Operator:]

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. And thank you for your participation.