Viveve Medical, Inc.
Q1 2021 Earnings Call Transcript

Published: 13 May 2021

[Operator:]

Good afternoon, and welcome to the Viveve First Quarter 2021 Financial Results and Corporate Update Conference Call. All participants will be in listen-only mode. After the today's prepared remarks, there will be a brief question-and-answer session. Please note, this event is being recorded. I will now turn the call over to Jeannie Swindle, Viveve's Senior Director of Corporate Communications. Please go ahead.

[Jeannie Swindle:]

Thank you, operator, and welcome, everyone. Before we begin, we would like to remind you that this conference call may contain forward-looking statements regarding future events or the future financial performance of the Company.

[Jim Robbins:]

Thank you, Jeannie. Good afternoon, everyone, and thank you for joining the call today. I will begin today's call with a brief review of our first quarter 2021 financial results. I will then turn the call over to Scott, who will provide a corporate update. And afterwards, we'll open the call to questions. Today, we reported total revenue for the first quarter of $1.5 million from the global sale of 8 Viveve Systems and approximately 2,450 consumable treatment tips. As of the end of the first quarter 2021, the Company had an installed base of 860 Viveve Systems worldwide. Total operating expenses for the first quarter decreased to $5.5 million, a reduction from $6 million for the same period last year. The decrease is a result of the Company's organizational realignment to focus on our current SUI clinical development program. We ended the quarter in a strong cash position due to the success of our public offering in January and our lowered operating cash burn of $3.3 million in Q1. Cash and cash equivalents as of March 31 were $28.4 million. Before handing the call to Scott, I will remind Viveve's shareholders on our call this afternoon that Viveve's recent 2021 Annual Stockholders' Meeting was adjourned to June 2 due to a lack of quorum. We would like to encourage all shareholders of record to please vote. Thanks. I'll now turn the conference call over to Scott.

[Scott Durbin:]

Thanks, Jim. Good afternoon, everyone. And again, thank you for listening to today's call. I will begin my remarks today to give perspective on the positive financial results and capital position of the Company that Jim just reported.

[Operator:]

Our first question comes from Ben Haynor with AGP.

[Ben Haynor:]

First off, congrats on getting ramped up to nearly all the 30 sites. You mentioned that you expect completion in the third quarter. I think on the Q4 call, you talked about early Q3. I mean, is that still kind of the sense given the recent acceleration? Or should we expect mid-Q3 or late Q3? Any color there would be helpful.

[Scott Durbin:]

Ben, thanks for joining the call today. Appreciate it. Yes, just with respect to the trial, enrollment never goes as fast as anybody hopes it does. I think we expected to see enrollment be a little bit greater through February and March, but sort of the COVID-19 impact on clinics and sort of the logistics of clinical trial execution played a part. And so we're very encouraged by where we are. A little bit more color I can tell you is that we've got -- a lot of patients have been screened. And as you know, we have fairly strict inclusion criteria to make sure that we are enrolling in a pivotal trial the most appropriate patient population who is going to have strong outcomes from the treatment. So generally speaking, we're sitting in a good spot today. We see enrollment accelerating now that almost nearly all the 30 sites are fully operational and enrolling and randomizing patients. And so it's a little difficult to predict whether it's going to be early in the third quarter, mid-third quarter. But our hope is certainly in the first half of the third quarter, we can complete enrollment.

[Ben Haynor:]

Okay. That's definitely helpful. And then just looking at kind of the revenue breakdown, it looks like U.S. revenue was a bit better than we expected. It was up 30-odd percent. I suppose, arguably, you could say that there may have been more of a COVID impact in Q1 this year than last year even. So I mean, is there anything specific on that, that you can kind of attribute the performance to? I mean, is it certain regions that are performing well? Is it kind of across the board? What's the right way to think about that?

[Scott Durbin:]

Yes. I think, remember that last year, we were -- it was prior to the readout of our sexual function trial. That was still a part of the -- our clinical development program and potential commercial opportunity. We were continuing to target a broad group of specialties, I think, as we went through 2020 and began to focus and shift our focus to the clinical development program for SUI and the commercial opportunity around SUI. I think the focus of targeting urogyn and urology and gynecology has paid dividends, particularly following the positive preclinical and clinical data we achieved in SUI last August.

[Ben Haynor:]

Okay. That's helpful. And then lastly for me on the program that you guys are going to initiate here. To the extent that you can kind of talk about it in the kind of current political environment, do you see that female physicians are, on average, more engaged or more receptive to the technology? Or is it something that is just a good thing for the business overall?

[Scott Durbin:]

I don't want to sort of make gender characterizations for the physicians.

[Ben Haynor:]

I figured it might be a little bit problematic.

[Scott Durbin:]

But -- yes. But let me just say this. I think the concept was derived by our sales team, certain individuals in our sales team, and it was a tremendous idea. And I can tell you that it's in its infancy right now. We have had our first event. It was very well attended, and enthusiasm for the opportunity to participate in a sort of female-only physician network, which is focused on stress urinary incontinence for a female population, was incredibly overwhelmingly positive. And so we had our first event. Again, it's in its infancy right now. We have several more events planned. We think it could gain a lot of momentum, and it's certainly good for business. But it's also -- we are a women's health company and try to do what we can to advocate in that area, and this is a step forward in that regard.

[Operator:]

Our next question comes from Jeffrey Cohen with Ladenburg Thalmann.

[Jeffrey Cohen:]

I'm going to skip any questions on what the current political environment is, and we'll go straight to the few that I had. So firstly, can you talk about the -- give us a better sense of the pace of the trial. You gave us some sense about the number of sites and how it looks. Will that kind of accelerate linearly throughout the second and third quarter? Or will that accelerate more swiftly?

[Scott Durbin:]

We think it's going to accelerate sort of linearly. Let me give you some perspective there. We've screened 280 subjects across 25 centers, roughly. And obviously, these numbers change on a daily basis. We have some strict -- as I mentioned in the previous response, we have some strict inclusion criteria really aimed at making sure that we have a predominant stress incontinence patient population in this trial, incredibly important for the ultimate outcome of measuring responders from a pad weight reduction perspective. We don't want a bunch of patients who are predominantly urge incontinence patients.

[Jeffrey Cohen:]

Okay. Got it. Could you talk about with and if an approval, how that data may play out outside the U.S.? Would it be something that you would -- with the clearance here, go for CE and others directly?

[Scott Durbin:]

Yes. We will certainly do everything we can to best leverage a positive clinical outcome from PURSUIT in the United's States. And we -- I don't want to speculate about the possibilities there. But Health Canada, CE Mark and other countries may be willing to accept that data, particularly on an FDA clearance to allow for an approval in that country. So we believe there's an opportunity to significantly leverage it, but we'll have to go through that process at that time.

[Jeffrey Cohen:]

Okay. Could you give us a sense of demographic age as far as the current trial and then maybe compare that or contrast that with how you think about the TAM and what that may look like in the U.S. and abroad?

[Scott Durbin:]

Well, we're focused -- from a trial perspective, I think the single biggest differentiator there between the TAM and our enrolled population is we are focused on a premenopausal patient population for the trial. We did that because it has been our history. That's been part of the inclusion criteria of historical effort in SUI, and we didn't want to introduce new variables going into our pivotal. I think that is the single biggest factor from a type of patient perspective between the trial and the total available market. That being said, I don't believe that's going to limit our opportunity if we have a positive trial outcome and get an FDA clearance for stress incontinence indication. There's nothing to suggest that our treatment can't be used in a postmenopausal patient who has similar SUI characteristics and severity. So that's the biggest difference.

[Jeffrey Cohen:]

Okay. Got it. And then lastly for me, Jim, on the income statement, can you give us a sense of the R&D line? Does it seem like that's going to kind of peak out in the second quarter or the third quarter? I think we had previously thought it would be towards the latter part of the year. Is that going to come a little bit earlier for us?

[Jim Robbins:]

Yes. I mean, it's -- we expect that it's going to pick up a little bit more in the second quarter, and then it's going to level back down after that. I mean, but -- so it's not going to be anything too dramatic, but it will peak in the second quarter and then start to level back down in the third quarter and then come back down later in the fourth quarter and then through the next year.

[Operator:]

This concludes our question-and-answer session, and the conference has also now concluded. Thank you for attending today's presentation. You may now disconnect.