Release Date: November 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tarsus Pharmaceuticals Inc (TARS, Financial) reported its most successful quarter to date with over $48 million in net product sales.
- The company expanded its sales force by 50%, which has already shown a positive impact on prescription volumes.
- Tarsus Pharmaceuticals Inc (TARS) secured additional commercial coverage and two large Medicare contracts, covering more than 80% of patient lives.
- The company launched a direct-to-consumer campaign on streaming television, which has received positive feedback and is expected to boost sales.
- Positive data from trials in patients with MGD was presented, showing significant improvements, which has been well-received by key opinion leaders and eye care professionals.
Negative Points
- The company faces traditional fourth-quarter headwinds such as multiple eye care conferences and holidays, which may impact sales.
- Despite the expanded sales force, the company has not yet seen meaningful retreatment volumes, indicating potential challenges in patient retention.
- Gross to net discount adjustments were necessary due to Medicare pool estimates, reflecting complexities in financial forecasting.
- The company anticipates a potential increase in gross to net discount due to the Medicare donut hole, which could affect profitability.
- Seasonal trends such as summer slowdowns and first-quarter deductible resets pose challenges to maintaining consistent sales growth.
Q & A Highlights
Q: Will the MGD expansion require another sales force expansion or targeted DTC? Also, when might you expect to see the impact of retreatments?
A: (Aziz Mottiwala, Chief Commercial Officer) The MGD data falls within the current indication and call panel, so no changes to the sales force or DTC are needed. Regarding retreatments, it's early, but we expect a 20% retreatment rate over time.
Q: How are you measuring the effectiveness of the new sales reps?
A: (Aziz Mottiwala, Chief Commercial Officer) We look at call productivity and script impact. The prescriber base is growing, and we're seeing positive trends in prescriptions, indicating the expanded sales force's effectiveness.
Q: How will the Medicare donut hole changes in 2025 affect the cadence of sales?
A: (Jeffrey Farrow, Chief Financial Officer) We expect the changes to smooth out the impact over the year, rather than having cyclical peaks and valleys, as seen in previous years.
Q: What is the strategy for MGD patients with overlapping DB, and is there a plan to expand the label?
A: (Seshadri Neervannan, Chief Operating Officer) The current plan is to educate physicians on using XMV for DB in MGD patients. There are no plans to expand the label at this time.
Q: Can you provide some color on seasonality and trends to expect?
A: (Aziz Mottiwala, Chief Commercial Officer) We expect some slowdown in the summer and challenges in Q1 due to deductible resets. These are the main seasonal trends to watch.
Q: What are the plans for patient retreatment, and how are you presenting this to prescribers?
A: (Aziz Mottiwala, Chief Commercial Officer) We remind doctors of the disease's chronic nature and that retreatment may be needed. Some doctors plan proactive retreatment, while others will wait for symptoms to return.
Q: What are your thoughts on M&A, and would it focus on ophthalmology?
A: (Bobak Azamian, CEO) We are focused on XMV but are open to development-stage opportunities and commercial assets that align with our platform in eye care.
Q: What are the benefits of the new Medicare and commercial contracts on SG&A?
A: (Jeffrey Farrow, Chief Financial Officer) The primary impact is from onboarding the commercial team. We expect SG&A to increase in Q4 with the DTC campaign and full sales force impact.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
