BioDelivery Sciences International, Inc.
Q1 2018 Earnings Call Transcript

Published: 11 May 2018

[Operator:]

Good day everyone, and welcome to the BioDelivery Sciences First Quarter 2018 Earnings Call. Today's call is being recorded. At this time, I would like to turn the conference over to Al Medwar. Please go ahead, sir.

[Al Medwar:]

Thank you. Good afternoon, and welcome to the BioDelivery Sciences first quarter 2018 earnings conference call. Leading us through the call today are Mark Sirgo, Vice Chairman; Herm Cukier, Chief Executive Officer; Scott Plesha, President; and Ernie De Paolantonio, Chief Financial Officer. Mike Bullock, National Director of Managed Markets will join us for the question-and-answer session following prepared remarks from Scott. In order to best communicate the data that will be discussed during this call, we will be using slides. Those on the webcast will be able to follow along with the presentation, and for those joining by phone, the slides are posted on the BDSI Web site. That said, I'll now read the company's Safe Harbor statement. Certain statements that BDSI's management made during today's call or in responding to questions and any other public documents of BDSI or statements of its management may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management's current beliefs and assumptions about the future, but are not statements of fact, and therefore, involve and are subject to significant risks and uncertainties. Forward-looking statements may include, without limitation, statements with respect to BDSI's plans, objectives, projections, expectations and intentions and other similar statements about the future. Forward-looking statements are typically defined by words such as projects, may, will, could, would, should, beliefs, expects, anticipates, estimates, intends, plans, potential or similar expressions. These statements are based upon the current beliefs and expectations of BDSI's management and are subject to significant risks and uncertainties including those detailed in today's conference call as well as BDSI's filings with the Securities and Exchange Commission. Please note that actual results, including without limitation, results of the commercialization of BUNAVAIL and BELBUCA may differ significantly from those set forth in the forward-looking statements. The risks and uncertainties relating to forward-looking statements are also subject to change based on various factors, many of which are beyond BDSI's control. BDSI undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. You're advised to review BDSI's SEC filings for risk factors that could impact BDSI's ability to achieve these goals described in the forward-looking statements. With that, I'll now turn the call over to Mark Sirgo. Mark?

[Mark Sirgo:]

Thank you, Al, and thank you everyone for joining us on our first quarter 2018 financial results conference call. It's a great pleasure today to introduce BDSI's new Chief Executive Officer, Herm Cukier, who formerly joined the company earlier this week. We are extremely excited to welcome Herm onboard. We did an extensive and thoughtful search to find an individual with strong commercial background and great leadership skills, and we believe we found that person in Herm. We are excited about Herm joining the BDSI at a time when we truly believe that behind BELBUCA growth we could take the company to the next level. As our press release from earlier in the week pointed out, Herm is a seasoned pharmaceutical executive uniquely qualified to step into this role. He brings extensive commercial leadership experience to BDSI having led a multitude of biopharma businesses to high growth success around the world over the past 25 years. He was most recently a Senior Vice President at Allergan, where his roles included being the Head of its Eye Care Division, the company's largest with more than $2.5 billion in annual sales, as well as the Head of its Women's Health Division, which was one of the fastest-growing segments of the company under his leadership reaching peak sales of $1.2 billion. Herm was most recently Head of Worldwide Commercial Innovation at Allergan, and was also both a member of the company's Commercial Leadership Team and its Operational Leadership Team throughout his tenure there. During his career, Herm was overseeing 50 branded products. Since Herm has only been with us a few days, we would like to spare him any in-depth questioning during today's Q&A, but you will be hearing from him extensively over the coming weeks as he, Scott Plesha and others on the management team will be hitting the road to meet with our shareholders, including various investor conferences this year. So, before turning things over to Herm, however, I want to take a minute to also thank Scott Plesha, who has acted as the company's Corporate Officer and overseeing the entire operation at BDSI since January 1. Scott has done a fantastic job managing his role, while driving our commercial businesses to new levels. Scott is an incredibly dedicated individual who continue to step up to meet the needs of the company. And I thank them enough, and I look forward to the extent Scott's successes at BDSI continue. So, let me now turn things over to Herm before we ask Scott to review our first quarter results. Thank you. Herm?

[Herm Cukier:]

Thank you Mark for your kind introduction, and good afternoon everyone. It is truly an honor to suiting the CEO role at BDSI at such an exciting time. I firmly believe the market dynamics in the evolving pain category are ideal for BDSI and our lead product BELBUCA. It will be my job to ensure that company is optimally-positioned to leverage and build upon the favorable trends you will hear more about shortly from Scott. Scott and the BDSI team with critical guidance from Mark and the Board have laid an excellent founding for growth with BELBUCA. My goal is to take that growth to the next level. I have already begun and will continue over the coming weeks to interact with all of our excellent managers and field staff as I work on the longer-term vision for BDSI. As Mark said, I will be out meeting with investors very soon and look forward to communicating this long-term vision to you. In the interim, I'm excited to work with Scott and the rest of the management team, as well as with Mark and the Board as we correct the strategy to build on BDSI's already-strong foundation, position the company for long-term growth, and unlock the considerable value in BDSI. With that, I will now turn the call over to Scott. Scott?

[Scott Plesha:]

Thank you, Herm. On behalf of the entire management team, I'd like to welcome you to BDSI. The team is thrilled to have you here, and I'm personally looking forward to working closely with you. Let me begin with a brief high-level review of our recent key accomplishments before moving on to more details. First and foremost, I'm very pleased to report strong prescription and revenue growth in the first quarter of this year. As Ernie will further elaborate on, BELBUCA revenues increased to $8 million in the first quarter, a 76% increase compared to the first quarter of 2017. These revenues were driven by a strong growth in BELBUCA prescriptions which totaled over 27,000 in the first quarter, an increase of 9% over the prior quarter, and 55% over the first quarter of 2017. We are proud to have reached an all-time high in monthly BELBUCA prescriptions in March, with well over 10,000 prescriptions. And April prescription sales are strong with BELBUCA achieving an all-time high in weekly total prescriptions last week. That is nearly double the number of weekly prescriptions when we assumed commercial responsibility for BELBUCA in early 2017. Fueling our BELBUCA growth is improved managed care coverage. During the first quarter, new contracts with Humana, ProCareRx, and CVS/Caremark were implemented. As a reminder, Humana, which became effective March 1st, is the second largest Medicare provider in the country. We also received improved coverage from UnitedHealthcare. We believe the same challenges that have created headwinds in the opioid space are creating opportunities for BELBUCA's payers a better understanding the differentiation of buprenorphine compared to CT opioids and its subsequent role in the management of chronic pain. And with that are either adding or moving BELBUCA to preferred status, thus providing us with an important opportunity throughout 2018 and beyond. Also contributing to the growth of prescription sales is the recently completed expansion of our sales force. As discussed on the March call, we have increased the number of territory managers from 65 to 85, the number of regional sales managers from five to nine. This translates into an additional 3,500-plus physician targets while increasing our reach and frequency within our territories. While be believe we are seeing impact from the additional sales territories, we believe the full impact will be realized in the second half of the year. Finally, as I noted on our last call, Purdue Pharma (Canada) launched BELBUCA at the end of January. The first commercial sale of BELBUCA in Canada triggered a milestone payment to BDSI from Purdue in the first quarter. As a reminder, we will also receive double-digit royalties on net sales, and be eligible for potential future milestone. Initial feedback from Purdue (Canada) continues to be positive. Now let me review BELBUCA's first quarter performance in greater detail and share with you some key recent sales metrics. First, looking at BELBUCA weekly prescriptions, we continue to see a solid upward trend which it continued since the first of the year. Of note, we had a new high in our weekly total prescriptions and after starting the quarter in the 2,000 prescription range, we have now surpassed 2,500. As you can see, we have started 2018 with solid momentum in BELBUCA prescriptions. On the next slide, you'll see the impact of this growth on monthly total prescriptions for BELBUCA which is particularly evident in the month of March when we achieved a new all-time high with over 10,000 prescriptions. This is particularly encouraging as it is a jump of nearly 20% over our previous all-time high which was reached in January. Moreover, at the end of March, BELBUCA's market share of buprenorphine products for chronic pain had grown to 18%. We're extremely pleased with the growth we have delivered in just over a year of active promotion which can be largely attributed to the focus and strong execution of our commercial team. And we expect this to continue as April has been a strong month as well, based on the weekly prescription data. Now let's turn to the continued meaningful progress we are making with Managed Care Access for BELBUCA, where you'll see we added two new plans in the past quarter, Humana and ProCareRx, and expanded access with two other important plans CVS/Caremark and United Healthcare. Finally, we have Ohio workers compensation beginning for third coverage of BELBUCA and exclusive coverage of BUNAVAIL, which has began last week. The new or improved access has had a meaningful and visible impact on our prescription growth trajectory. On the next slide, you can see the impact from two of these contracts, CVS and Humana. CVS/Caremark expanded formulary access and moved BELBUCA to a preferred Tier 1 as of January 1, 2018. In other words, patients must first try and fail BELBUCA before they can access Butrans. As a result of this change, prescription growth was up 25% over the prior quarter. Humana is the new contract as of March 1, and importantly adds BELBUCA as a preferred agent for both our commercial and Medicare business. BELBUCA can also be prescribed at other requirement of prior-authorization, which is a meaningful advantage for BELBUCA in this category. While this contract just began in March, we have already seen its impact on prescriptions in the first quarter this year as shown here. The impact of this change is noteworthy; in March of 2018, we had nearly 500 BELBUCA prescriptions sold to Humana after having been in the 200 range previously. Going forward, we are exciting about the future, the further prescription growth potential from this contract, and look forward to continued formulary wins. Collectively, we believe our improved formulary positioning and new contract wins reflect the solid progress we have achieved in highlighting to payers the value and well-differentiated benefits of BELBUCA. In summary, payer coverage for BELBUCA is strong and improving in significant and meaningful ways. In addition to improving Managed Care Access, we continue to work on several legislative and regulatory initiatives supporting BELBUCA with the goal of improving patient access. We believe BELBUCA with its lower abuse and addiction potential compared to Schedule II opioids and the fact that it appear to exhibit dose ceiling effect unless depression should be part of the rapidly evolving national conversation on opioids, P management, and addiction treatment. Over the last quarter, there has been a significant increase in legislative activity in the drugs and the opioid crisis, and we continue to put effort behind being involved in the ongoing dialog in legislative process. Regarding the CDC guidelines, a bill from the Senate Health Committee as well as Legislation Congress has language recommending that the CDC updates is pain prescribing guidelines. We'd like to see them at Buprenorphine for chronic pain to their guidelines and continue to advocate around the value using Schedule III opioids such as Buprenorphine prior to the use of Schedule II opioids. Also, CMS recently announced a number of new strategies to further help Medicare sponsors address the opioid epidemic. Our initiatives include limits on prescriptions for opioids for treatment of acute pain to seven days, CMS also recommends the sponsors that they implemented daily-dosing limits. This edit would instruct the pharmacist to consult with the prescriber prior to dispensing and requiring documenting the reasons for prescribing at or above this dose level. This has the potential to impact 1.6 million Medicare recipients. This maybe beneficial to BELBUCA as this will not likely impede use of Buprenorphine for chronic pain in the same manner it could Schedule II opioids. This may be beneficial in the Buprenorphine, may not be subject to the same scrutiny on dosing as the Schedule II opioids with CMS or in other instances where payers or pharmacies implement any rules among dosing levels. This is just some of the many legislative initiatives. There are literally hundreds of those that are being introduced to address a wide array of addiction and pain management-related issues. Many aim to improve access to treatment. We are in the middle of these important discussions through our efforts, and will continue to invest significant time in such efforts. In summary, as we look at catalysts, we will continue to drive BELBUCA sales, our primary emphasis will remain on our focused sales efforts, which are now supported by our greater share of voice among pain management specialists as a result of our incremental sales force expansion at a time when a number of other players in the category have stepped away from the market. As alluded to on the last earnings call, we have also implemented non-personal promotion for advertising in broad-reaching pain journals such as Pain Medicine News, and we'll be utilizing other targeted forms of advertising such a banner ads, emails, and social media to supplement our sales force efforts, and to increase the recent frequency of our key BELBUCA product messages. Finally, we remain excited about the recent launch of BELBUCA in Canada, and look forward to its uptake in that market. In summary, we are very pleased with our strong first quarter results, and what we are seeing so far in Q2, and are confident that BELBUCA is well positioned for continued strong growth in 2018. We look forward to Herm's leadership as BDSI's new CEO, and remain focused on generating meaningful growth in BELBUCA sales in 2018 and beyond with our expanded sales force, new managed care opportunities, and the promising legislative trends we are seeing. With that, I'll turn things over the Ernie to cover the financials in more detail, and then we'll open things up to Q&A. Ernie?

[Ernie De Paolantonio:]

Thanks, Scott. Good afternoon everyone. I will briefly review some of the key financials from what was a strong first quarter. In the first quarter, BDSI recorded total net revenue of $11.3 million or a 19% increase versus $9.5 million on a comparable basis for the first quarter of 2017. Additionally in 2017, there was $20 million of non-cash deferred revenue released as part of the Endo license termination which made the total revenue $29.5 million. BELBUCA revenue in Q1 totaled $8 million, up 76% over prior year revenue of $4.6 million. First quarter gross to net percentage for BELBUCA was in the upper 30s due tot increased use of co-pay cards and higher Medicaid usage due to organic growth of that business. Gross profit percentage for BELBUCA was 81% in the first quarter. We expect additional cost and yield improvements in Q2 and beyond with the migration of BELBUCA to our newly approved high speed packaging equipment. Total gross profit from both commercial products was slightly over 70%. Total operating expenses for the first quarter ended March 31st, was $16 million and flat when compared to $15.9 million in the first quarter of 2017. Sales and marketing expenses were $6.4 million, G&A expenses were $7.1 million, and R&D expenses were $2.5 million. We expect to see total marketing and sales expense as slightly higher in the second quarter in support of ongoing marketing programs. Net loss in Q1 was $10.7 million or $0.18 per share compared to income of $48.3 million or $0.87 per share in 2017 resulting from both the $20 million of deferred revenue and the $43.3 million associated with the purchase of BELBUCA and the termination of the license with Endo. Finally, as of March 31st, our cash balance was $12.1 million. Thank you. And I'll now turn it to the question-and-answer session.

[Operator:]

[Operator Instructions] We'll go first to Brandon Folkes from Cantor Fitzgerald. Your line is open.

[Brandon Folkes:]

Hi, thanks for taking my question, and Herm, congratulations on the appointment. Firstly, I know Ernie just touched on it, but could you just elaborate on your thinking on gross to net with the new formulary wins? Should we think about gross to net going forward to be within the historical range or anything else we need to think of there? Secondly, maybe you can just touch on how you think about cash runway and means to address this, I know we spoke about this on the prior quarter call and I know there were means you talked about in terms of extending that. BELBUCA looks to do well in going forward. And then Herm, so I won't ask you in-depth strategy just yet, but maybe just frame it in another way, when you did your diligence and looked at BDSI, in the near-term was it the potential of BELBUCA that brought you to BDSI or was it the potential of BELBUCA and what else do your firm have or you could layer on the current platform? Thank you.

[Ernie De Paolantonio:]

Okay, on the first question, we expect the gross to net to remain in a relatively similar range as it is now, we always said, in the upper 30s. However, the gross to net is naturally [ph] dictated by the payer mix going forward. On the cash runway, we're looking at an average burn of about $7 million per quarter. So with the $12.1 million, you can see we'll be in the next couple of quarters.

[Herm Cukier:]

Hi, this is Herm Cukier. Thank you very much for the kind words. As you said, I'm very new here and just kind of getting to know the team and the business, and looking forward to continuing, as I said earlier, to do my rounds and with the team and then go and meet everybody. I will say that for me this is a wonderful opportunity to join an organization that was in a commercial stage of existence. I do feel that we have a very differentiated product with a lot of promise and potential. I think it's in a very important clinical space where there is still a significant amount of need. I think as Scott shared, we're in a very positive trajectory and momentum with the product. I was very impressed with the strong leadership and the very impressive company culture that I found here during my meetings and diligence. And also the ambition by the Board to build towards even further success. So I'm looking very much forward to working with the team to crystallize our strategy moving forward. And look forward to that appropriate time to discussing further.

[Brandon Folkes:]

Thank you very much.

[Operator:]

And we'll take to Scott Henry with ROTH Capital next. Your line is open.

[Scott Henry:]

Thank you. Good afternoon and congratulations, Herm. Let me just hit on a couple of questions, just -- and I know you talk a lot about gross to net and revenue per script. In BELBUCA is certainly looked within the range of expectations for revenue per script. BUNAVAIL, on the other hand, kind of jumped up in third quarter last year, jumped up again in the fourth quarter of last year. My question is it jumped up again from, say, 89 to 101 in Q1 of this year. What's the better number to think about the roughly 100 or the roughly 90, just trying to get my arms around that? And we're talking about BUNAVAIL.

[Ernie De Paolantonio:]

Yes, hey, Scott, it's Ernie. Probably in that range of 90 to 100 is a good number to think of going forward. If you remember, we have better rates now on our TennCare contract, as well as doing some adjustments to the programs that we had.

[Scott Henry:]

Okay, great. And then couple of modeling questions. The $422,000 in royalties, did you book any Canadian royalties in Q1? Is there a lag there? How should we think about that?

[Ernie De Paolantonio:]

Yes, there is a lag. When they report their revenue we get a double-digit royalty. They have yet to report revenue.

[Scott Henry:]

Okay.

[Ernie De Paolantonio:]

So there'll be at least a quarter lag.

[Scott Henry:]

And it looked to me, at least on first pass that the COGS looked a little bit low in the quarter, any thoughts on that?

[Ernie De Paolantonio:]

When you say they looked low…

[Scott Henry:]

Well, the gross margins were higher than I would've anticipated. It seems like a very efficient quarter.

[Ernie De Paolantonio:]

Right, again, BELBUCA continues to perform at an 80-plus level, and BUNAVAIL is doing better due to the lower gross to net that it's incurring.

[Scott Henry:]

Okay. So it sounds like you think that is at least somewhat sustainable?

[Ernie De Paolantonio:]

Yes.

[Scott Henry:]

Okay. And then with regards to new reps for BELBUCA, are they trained and in the field, and if so, when did they enter the field?

[Scott Plesha:]

It's Scott, thanks for the question. So the majority of them were trained the second week in January, and there was another [indiscernible] trained about three weeks ago. So they're in the territory. We've already started to see some impact from them. But as you know, it can take three to six months to really get up and see full impact. So imagine that -- we believe actually that the second half will see really come at that expansion full force. But again, we're seeing some nice uptake already in some territories.

[Scott Henry:]

Okay, great. And then just the final question just with regard to the environment for BELBUCA, obviously the opioid situation is very fluid. And certainly the merits of BELBUCA in the scheduling would make that a more preferable opioid. But when the whole category is coming under pressure, sometimes that helps you sometimes it doesn't. What's your sense of the environment currently? Are the positives for BELBUCA overweighing the market category? Now, it's good to tell me they are, but I just wanted any color you can have on the pushes and pulls, and how we should think about BELBUCA relative to a declining opioid category?

[Scott Plesha:]

Scott, I think that's a great question. I mean, there's definitely pressures to prescribe things that may potentially have less -- would be potentially less likely to cause dependence or abuse, if you look at the market though there's been intense pressure there already for the last year-and-a-half or two. And just the growth we've seen in our product over the last year, and then even in the last couple of months with these added managed care plans, and I think even the trend we've seen for BELBUCA to be added in a preferred status within the managed care world, just these plans moving us in a more preferred position is kind of indicative of how they're viewing the product and how it fits in the opioid crisis we have. So we feel we're uniquely positioned in this space. There's really not much else in the long-acting opioid space that checks the boxes we do that provides the benefits.

[Scott Henry:]

Okay, great. Thank you for that color, and thank you for taking my questions.

[Operator:]

And our next question comes from Tim Lugo with William Blair. Your line is open. Mr. Lugo your line is open. You may want to pick up the handset and un-mute the phone. All right, we'll move on to Ken Trbovich with Janney. Your line is open.

[Ken Trbovich:]

Thanks for taking the question. Scott congratulations to you and the team for another great quarter with BELBUCA. Certainly look forward to seeing continued progress there. I guess maybe the biggest surprise to me was the control on the SG&A line. I know, Ernie, you talked about the idea that some of those expenses will go higher for the remainder of the year. But I was wondering just with regard to sort of relative range, are we talking about levels that are consistent with or lower than those seen last year or higher than those that were seen last year at those peak levels?

[Ernie De Paolantonio:]

Okay, on the sales and marketing, Ken, you'll probably see a little bump in the next quarter for those marketing programs. And then it'll sustain at that level through the end of the year. On the G&A line, you're probably going to see an average of what we did in the first quarter throughout the rest of the year.

[Ken Trbovich:]

You got it. And then, Ernie, you gave some commentary on sort of the cash balance. Could you give us a sense as to whether you guys are in position to trigger the next tranche with CRB?

[Ernie De Paolantonio:]

Well, the next tranche would not only be for -- include sales, but it would also include market cap of about $200 million.

[Ken Trbovich:]

Got it. Okay, so it's not just a performance on the bottom line, it's also the cap-related?

[Ernie De Paolantonio:]

That's correct.

[Ken Trbovich:]

Okay. And then just in terms of that benefit that you guys have seen with regard to Ohio, I know, Scott, you've talked about the fact that it's just kicking in. I shouldn't say you've seen it, but expect to see. On the Ohio side, I think sometimes we lose sight of the fact that a workers comp plans in large population states can be major drivers, much the same as maybe a managed care plan. Can you give us a sense as to the relative importance of the Ohio workers' comp and then give a, specifically, if there's a major difference between, let's say, the pain side versus the addiction treatments.

[Scott Plesha:]

So, Ken, first off, thank you for your congratulations earlier. The team's done a really strong job, there's no doubt about it. So Ohio workers' comp was an important win for us. If you look at that state and they show up under commercial payer, they're either number three or four in the state. So it is meaningful. It's something that we can build volume around. And we'll continue to work other states as well. We think it might also give us ability to start looking at other states as well. I don't know if, Mike, if you have any other comments regarding that as well?

[Mike Bullock:]

Yes, I guess the only thing I would add is just the trend about and how payers are beginning to receive the product more favorably, that's a big indicator that our message is resonating and the product, they're seeing it more as a solution as we're getting in front of these payers. So that's aborted for a lot of reasons in Ohio workers comp not only for sales in the company but beyond.

[Scott Plesha:]

And sure, specifically about BUNAVAIL, you separated the two. So BUNAVAIL, we really are unable to see data within that space right now through our data source. But we do know the hither workers comp is being very proactive in the state and trying to build out a program around opioid dependence. And again, we'll be the preferred product there or exclusive.

[Ken Trbovich:]

Got it. And then…

[Scott Plesha:]

I can't guess the numbers at this time.

[Ken Trbovich:]

No, that's fine. And then just one last question just with regard to should've been normal cycle for getting contracts that might switch over in July. Do you guys have a sense for where you're at and whether or not that Humana experience is something that helps you or that you're seeing the benefit of in some meetings with payers as it relates to some of those contracts that change in July as opposed to the normal cycle for next January?

[Scott Plesha:]

Yes, Ken, so it's tough to predict right now. I can tell you that we certainly leverage those wins where we can. And they are important to other payers in the market. They're certainly competitive with each other. So they do pay attention, and we encourage them to pay attention. So we're hopeful. I can't give you any guidance around who may or may not come online, but it's certainly something that we do share with every customer that we're in front of. And it's being well received, I guess is about as much as I would tell you at this point.

[Ken Trbovich:]

Sure, sound good. Well, I appreciate the time. Thanks for the opportunity to ask the questions.

[Scott Plesha:]

Thank you, Ken.

[Operator:]

[Operator Instructions] We'll go next to Tim Lugo from William Blair. Your line is open.

[Tim Lugo:]

Hi, this is Tim. Sorry if you couldn't hear me last time around. So we saw prescription sales increase in numbers over the prior quarters, you have a number of new sales reps, you have some great contracts. When should we start to see an acceleration in the returns?

[Ernest De Paolantonio:]

I think we already have. If you look at March, we have a 20% growth over January. And if you look at the weekly numbers in April you'll see very strong weekly numbers as well, and probably larger jumps than we've experience since we've had the product back. So we're definitely seeing -- and we've also seen at a wholesaler and a pharmacy level increase in demand ahead of that.

[Tim Lugo:]

And even with the -- I guess with how gross to net shakes out over the year we should just continue to see acceleration throughout the year?

[Ernest De Paolantonio:]

Pardon me, could you repeat that please, Tim?

[Tim Lugo:]

Sure. I have a quick question with gross to net because [indiscernible] acceleration through the quarter?

[Ernest De Paolantonio:]

Yes, I think our prescription growth will be strong. The other thing I'll add, I had mentioned earlier, we're also seeing an inflection also in the prescribers. March was the largest month we've ever seen in one month, up significantly over previous months.

[Tim Lugo:]

[Indiscernible] additional contracts, are you looking to -- are you looking for national contracts or you're looking for more regional contracts. I know that there are certainly pockets where you're very strong. But can you give me a sense of where you're trying to get the new contracts?

[Ernest De Paolantonio:]

Yes, so good question. And the answer would be certainly at the national level with major payers where we don't have contracts to date. And where we do have contracts the goal is to improve positioning within that contract. So we've seen some of that with, Scott mentioned, with United and CVS where we've had contracts and moved up either on from access or from clinical criteria that they use. So those are things that we're looking to do with all payers, and certainly with the national payers. But we also focus on regional payers that have an interest and the ability to do contracting. So we're trying to be smart where we do it, and focus on those that have an interest in this space, and are willing to do things maybe differently than they've done historically in this space.

[Tim Lugo:]

Okay. And Herm, I know you are looking -- yes, I know your tenure is very short so far, but when are you looking to -- you know, to look at more of a strategic perspective and maybe your thoughts on the business and where you are going to take the business going forward. Is that going to be in the next quarterly call? Is it maybe something before the next quarterly call?

[Herm Cukier:]

Hi, Tim, thank you very much for the question. Yes, I think we are working on that as my schedule is kind of developing. So, I'll probably start thinking about locking that in and reaching back out to folks and seeing your schedules, we'll start coordinating that over the next few weeks and probably over the next few months, and be able to circle back and have those discussions.

[Tim Lugo:]

Understood. Congratulations on the progress.

[Herm Cukier:]

Thank you very much, excited to be here.

[Operator:]

And that's all the time we have for our question-and-answer session today. At this time, I would like to turn it back to Scott Plesha for final remarks.

[Scott Plesha:]

Thank you. In closing, I want to thank our employees or their hard work and dedication driving our results, and also for the help they're providing patients and our providers. Also want to -- would like to thank our shareholders for their continued support. Have a great day, and we look forward to updating you again on our next earnings call. Thank you.

[Operator:]

And that concludes our call for today. Thank you for your participation. You may now disconnect.