Akili, Inc. (NASDAQ:AKLI) Q4 2022 Earnings Call Transcript

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Operator: Our next question comes from the line of Marie Thibault with BTIG.

Marie Thibault : I wanted to ask my first here on the conversion rate. I know that you mentioned a couple of headwinds here in the fourth quarter that drove that rate down to 40%. I wanted to understand, are you expecting that to improve in Q1? I know certainly, we won’t have the holidays like we did in Q4, but then the 30-day refill, the 30-day prescription factor is still there. And I also wanted to understand, how you’re thinking about conversion rate in the refill space. It certainly looks like that’s a nice high 90% or so by our math. Just how should we be thinking about conversion for resales going forward?

Santosh Shanbhag : Yes. Thanks, Marie. We have not provided guidance or forecast regarding the conversion. As you mentioned, there were two business changes, the biggest being that migration from 90 to 30-day prescription while holding the pricing constant. That was an impact. The seasonal holiday is another impact. Of course, that will not persist again in Q1. With that said, this is also an area of emphasis for our sales team. So in those areas where we have the ability to engage with clinicians, we’re talking about the importance of follow-up and making sure that patients and caregivers are prepared. So we are doing our best to continue to message and educate around the importance of fulfilling those prescriptions. But as far as giving guidance, we’re not prepared to do that at this time.

Marie Thibault : Okay. Just on the refills. I know it is early, but given that those are sort of built into the initial prescription, should we expect something around that high-90s is a reasonable range?

Matthew Franklin : Again, early days. I mean, we estimate the business changes. So we’re hesitant to provide guidance on that.

Marie Thibault : Okay. Fair enough. And then maybe I’ll ask a further question sort of on the sales force. As you’re thinking about adding this next wave here in the first quarter, how should we think about the maturation of the sales force? Is this kind of a six months — a year-long process for these sales reps as they enter new territories? And what is kind of the key learnings on who is the right prescriber profile, who is the right kind of caregiver profile to target?

Matthew Franklin : Yes. Thanks for that question. And consistent with any product launch, particularly in a situation where we’re defining a new category as we are with EndeavorRx, there’s absolutely a learning and experience curve. We’re still relatively early days. The team has really been in the field for several months. With that said, we are very pleased with the progress we’re seeing. As we mentioned, we’re seeing accelerated growth on all of their critical commercial and adoption metrics in those sales territories. So pleased with what we’re seeing. Initially, we will continue to see — we expect continued improvement there. So I wouldn’t say, we’re there yet, we’re continuing to learn and grow, but that learning curve, we’re working through that effectively.

As far as the physician profile, yes, consistent with our initial indication, 8 to 12-year-olds, not surprisingly, we’re focused on pediatric specialty. So pediatric psychiatrists, pediatric neurologists, in addition to general PD attritions that see a large number and are responsible for monitoring a number of these patients over time. So really focused on sort of those integrated behavioral health centers, where they’re multidisciplinary practices dealing with these complex cognitive impairments on a day in, day out basis. So that focus was consistent from our initial perspective and remains a point of emphasis for us.

Operator: And our next question will come again from the line of Judah Frommer with Credit Suisse.

Nicholas Japhet : It’s Nick on for Judah again. Just wanted to go back to the adolescent data, any initial thoughts on why the effect on attention was higher in that population versus the initial 8 to 12-year olds. And was it something to do with trial design or just the specific population? And how do you think that efficacy might translate into adults?

Scott Kollins : Nick, this is Scott. Thanks for the question. Yes, it’s a very good one. We have a couple of broad hypotheses about why we might have seen the greater magnitude effect in adolescents. The first is that maybe they had something to do with the composition of the sample compared to the pediatric population. That’s pretty easy to look at. And at least in the top line, it doesn’t look like things like the gender differences, the breakdown in racial or ethnic subgroups is going to make much of a difference. But we are going to interrogate that further, where I would think we’re likely to uncover some understanding of that effect is with looking at the way that the participants engaged with the treatment. Older kids might just be more motivated and be more engaged with the treatment and therefore, derive more benefit.

So that is an area that as we prepare the data for presentation and publication that we’re going to be diving into further. And as far as well — how we think that might extrapolate, it’s unknown, and we’ll know when we get top line data from the adult study.

Operator: Thank you. Ladies and gentlemen, this concludes our question-and-answer session, and this will conclude today’s conference. You may disconnect your lines at this time. Thank you for your participation.

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