Release Date: May 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Senseonics Holdings Inc (SENS, Financial) reported a 22% growth in total revenue, reaching $5.1 million in Q1 2024 compared to the prior year.
- The company has successfully advanced strategic initiatives, enhancing the appeal of its Eversense CGM system to a broader patient base.
- Senseonics Holdings Inc (SENS) has established a significant collaboration with Mercy, one of the largest health systems, to use Eversense in a diabetes population management program.
- The company has achieved important regulatory milestones, including FDA ICGM designation for Eversense and submission of a 510(k) for the next-generation 365-day product.
- Senseonics Holdings Inc (SENS) is developing a comprehensive RPM program designed to optimize patient outcomes through better data utilization and personalized support.
Negative Points
- Gross profit in Q1 2024 decreased to $0.3 million from $0.4 million in the prior year, primarily due to higher fixed manufacturing costs.
- The company reported a substantial net loss of $18.9 million in Q1 2024, a significant increase from a net income of $1.3 million in the same period last year.
- Research and development expenses, although reduced from the previous year, remain high at $10.4 million, reflecting ongoing investment in product development.
- The company faces challenges in managing inventory levels, particularly as it transitions to the 365-day product later in the year.
- Senseonics Holdings Inc (SENS) is still in the early stages of discussions for integration partnerships with insulin pump manufacturers, with no definitive timelines for commercial integration.
Q & A Highlights
Q: Can you provide an update on how Ascensia has been managing the inventory and the progress on new Eversense starts?
A: Timothy Goodnow, President and CEO of Senseonics, noted that Ascensia is making good progress in managing their inventory and seeing quarter-over-quarter patient growth. He mentioned an over 80% growth in the first part of the year compared to last year and anticipates fully working through the inventory over the next quarter as they transition to the 365-day product.
Q: How significant could the Mercy collaboration and RPM program become, and what investments are needed from Senseonics in these RPM programs?
A: Timothy Goodnow explained that the Mercy collaboration is a significant opportunity, particularly because it aligns well with the long-term nature of the Eversense product. Jeff Ruiz, Head of Strategy and Commercial Business Development, added that the RPM program is key to the success of health system strategies and is financially sustainable and scalable. The costs and fees are known upfront, allowing for clear financial planning.
Q: What is the potential penetration ceiling for the 30,000 patient opportunity with Mercy, and what are the early color on the economics?
A: Timothy Goodnow mentioned that this is the first system implementation and is expected to be the basis for designing future systems. He highlighted that the 30,000 patient opportunity is significant and is part of their current commercialization agreement with Ascensia, with usual business economics.
Q: Can you discuss the approval timeline for the 365-day product and its integration with the annual Medicare process?
A: Timothy Goodnow confirmed that they are working with Medicare and commercial payers following the FDA submission for the 365-day product. He expressed confidence in the approval process, noting that the 510(K) timeline is quicker than the PMA supplement process.
Q: How does the RPM model work economically, and how does it compare to selling into offices not part of the Mercy system?
A: Jeff Ruiz clarified that the sensor itself goes through the normal process, and there is no risk-sharing or alternate model for the device side. The RPM follows existing healthcare reimbursement structures, where Mercy pays a fee to Senseonics for the RPM services and then files for reimbursement.
Q: What does the Mercy collaboration mean for other CGMs in their system, and how does it interact with competitive products?
A: Jeff Ruiz explained that the agreement with Mercy is not exclusive and does not intend to switch patients already using other CGMs. The focus is on reaching the majority of patients who are not currently using any CGM, which presents a significant opportunity to improve clinical outcomes and reduce healthcare costs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
