Revance Therapeutics, Inc. (NASDAQ:RVNC) Q1 2023 Earnings Call Transcript

Revance Therapeutics, Inc. (NASDAQ:RVNC) Q1 2023 Earnings Call Transcript May 9, 2023

Operator: Welcome to the Revance Therapeutics First Quarter 2023 Financial Results and Corporate Update Conference Call. At this time, all participants are in a listen-only mode. Following managements’ prepared remarks, we will hold a Q&A Session. As a reminder, this call is being recorded today, Tuesday, May 9, 2023.

Jessica Serra: Thank you, operator. Joining us on the call today from Revance are Chief Executive Officer, Mark Foley; President, Dustin Sjuts; and Chief Financial Officer, Toby Schilke. During this conference call, management will make forward-looking statements, including statements related to 2023 guidance, cash flow breakeven, operating leverage, block buster potential, our ability to draw on our debt and future revenue expenses and forecast our growth potential, approval and entry into the therapeutics market, our potential in other therapeutics indications, our commercial success, injector and consumer preferences and behavior, the efficacy and duration of DAXXIFY, the benefits to us, practices and consumers of our products and strategy, our customer base, the supply and manufacturing of DAXXIFY, our sales team, our strategic partnerships and our strategy planned operations and commercialization plans and timing.

Our actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties. Factors that could cause results to be different from these statements include factors the Company describes in the section titled Risk Factors in our Annual Report on Form 10-K filed with the SEC on February 28, 2023 and our quarterly report on Form 10-Q filed with the SEC today, May 9, 2023. Revance undertakes no duty or obligation to update any forward-looking statements as a result of new information, future events or changes in its expectations. Also on today’s call, we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP. A reconciliation of non-GAAP to GAAP measures is included in our earnings release.

With that, I will turn the call over to Mark Foley, Chief Executive Officer of Revance. Mark?

Mark Foley: Thank you, Jessica. Good afternoon everyone. And thank you for joining our first quarter 2023 financial results conference call. We are very pleased to report our first quarter results highlighted by strong execution on our DAXXIFY launch and the continued growth of our RHA collection of dermal fillers. Total revenue nearly doubled from last year to $49 million for the first quarter, and we continued to see healthy procedure volumes in our target accounts, as well as favorable trends supporting the long-term growth of the facial injectables market. With our lead asset launched and our contract manufacturer now online to produce DAXXIFY at scale, we are in a great position to continue the growth of our aesthetics franchise.

At the same time, we’re excited to see our opportunity in therapeutics quickly approaching with our PDUFA date for DAXXIFY for cervical dystonia set for later this summer. The first year of DAXXIFY’s launch is an exciting time for the company and critically important from an execution standpoint. Since we initiated our DAXXIFY early experience program in December, we’ve continued to be encouraged by the strong level of enthusiasm and positive feedback we’ve received from both aesthetic providers and consumers. Between DAXXIFY’s preview program and recent launch, we believe our performance thus far is indicative of a few things. First, DAXXIFY’s innovative formulation and differentiated performance profile has been highly anticipated by the aesthetics market.

We believe with duration being the number one unmet need for injectors and consumers, DAXXIFY’s novel peptide formulation, along with its ability to enhance aesthetic outcomes without increasing the amount of core neurotoxin, continues to drive excitement and demand, while also shaping the narrative on toxins to our advantage. Second, DAXXIFY’s disruptive innovation allows us to approach the market in a way that no other manufacturer has before. And so far we’re very encouraged that our targeted and measured approach to DAXXIFY’s launch is continuing to prove out. Based on our prestige strategy, we are focused on going deep into accounts versus wide, just like we have done with our RHA line of fillers. And with our no advertised pricing policy, we are committed to partnering with practices in an effort to help moderate the commoditization of the facial injectables market and assist them in maintaining healthy margins.

Third, we have an experienced proven commercial team with a track record of success along with an established base of customers. Recall that this team successfully launched the RHA collection under the same strategy despite the operational challenges presented by the COVID-19 pandemic. We safely conducted thousands of in-person and virtual trainings to onboard our sales team and customers. With DAXXIFY’s introduction to the market, we look forward to deepening our relationships with our existing practice partners, while also leveraging our leading portfolio to further expand our base of customers. Lastly, we plan to continue our focus on training and education and believe that our Nashville Experience Center serves as an important platform for us to drive customer engagement, while also showcasing our leading brands and strategy.

Our commitment to training, education and patient outcomes is central to ensuring that injectors realize the full benefit of our innovative products. We believe this is one of the reasons why the RHA collection of fillers is the fastest growing filler lined on the market. Overall, we feel very good about our progress, execution and position in the robust and resilient $3.5 billion dollar U.S. facial injectables market, which includes both neuromodulators and dermal fillers. While we believe we are at the beginning of a tremendous opportunity, we recognize that these are early days with hard work ahead of us. DAXXIFY’s launch is our top priority, and we remain very focused on successful execution. Turning to therapeutics, our team has begun laying the groundwork for our anticipated approval of DAXXIFY for the treatment of cervical dystonia or CD.

Our upcoming PDUFA date is August 19, and if approved, we anticipate launching a preview early experience program in late 2023, followed by commercial launch in 2024. In preparation for our entry into therapeutics, we are in the process of building out our managed care and medical affairs teams, while also putting in place the necessary commercial infrastructure to support our planned preview program on approval. We’re making great progress on all these fronts and are looking forward to the opportunity to help CD patients achieve sustained symptom relief with DAXXIFY’s differentiated efficacy and duration profile. The current U.S. cervical dystonia market size is estimated to be in excess of $300 million with a projected compound annual growth rate of over 7%.

We believe that CD approval will provide us with a gateway into the $1 billion muscle movement disorders category and further highlight DAXXIFY’s potential in other therapeutic indications. With that, I will turn the call over to Dustin. Dustin?

Dustin Sjuts: Thank you, Mark. 2023 is setting up to be a transformational year for Revance. DAXXIFY’s launch is off to a strong start, the RHA collection is continuing to grow, and we continue to deepen our relationships with our providers. I’m very proud of the team’s strong execution and performance in this first quarter. Starting with our dermal fillers, RHA sales increased 45% year-over-year, resulting in Q1 sales of $30.3 million. On a sequential basis results were also strong despite Q1 traditionally being a seasonally slower period for the aesthetics market. We are pleased to see RHA Redensity along with the rest of the collection, including RHA 2, 3 and 4 gain wider adoption given the product’s range of utility and ability to deliver natural looking results for patients.

We continue to be encouraged by our customer’s conviction and our filler line and their excitement in adding DAXXIFY to their product mix. We look forward to building on our commercial success, realizing the synergies of our neuromodulator and filler combination, and continuing to grow both product lines under our prestige go-to-market strategy, which is underpinned by our no advertising pricing policy. Turning to DAXXIFY, following the conclusion of preview we are pleased to initiate our commercial launch in late Q1 and report over $15 million in DAXXIFY revenue for the first quarter, where majority of our sales volume came from accounts onboarded prior to launch. Recall the preview was our early advisory and experience program that spanned from December 2022 to March of this year.

Despite this phase or during this phase, select practices gained exclusive access, access to DAXXIFY treating tens of thousands of patients, and as a result gained significant firsthand experience with this innovative product. The advisory program led to key insights and learnings that provided us invaluable guidance as we transitioned into commercial launch with a key focus on optimizing outcomes and seamless practice integration. We continue to be very encouraged by the positive feedback we’re receiving from providers and consumers on their early experience of DAXXIFY, including duration, onset efficacy, skin quality, and overall aesthetic outcomes. To date, there has been no shortage of interest from providers as we kicked off our highly anticipated commercial launch in late March with a priority on live in-person trainings.

Additionally, we supplemented these in-person trainings with virtual training options in order to enhance our customer engagement options. Further our OPUL Fintech Platform generated $180 million of gross processing volume or GPV for the first quarter and $690 million of GPV for the trailing 12 months. Overall, I’m very pleased with our strong sales results that ongoing commercial momentum ending the quarter with over 5,500 accounts across our aesthetics portfolio. To support our continued aesthetic portfolio growth, we expanded our sales organization by approximately 50 reps. Our recently expanded 150-person plus field force will be focused on two key objectives. First, growing our share within the $2 billion U.S. neuromodulator market with focus and intention.

This means driving the adoption of DAXXIFY by going deeper within our early adopters by also adding new accounts that best fit the profile for long-term partnerships. We believe this targeted approach aligns with our strategy and allows us to deliver the highest ROI. As we scale our launch it’s important to note that the adoption process for accounts can vary, but typically follows a standard cadence of training, sample, trial and then deeper adoption. Our second objective is to continue our market penetration of the RHA Collection by demonstrating its differentiated properties through continued training and education. Customer feedback indicates our training program have helped them realize the full benefit of the product utility, supporting product adoption and optimal aesthetic outcomes.

Through our strategy, we have quickly gained market share and have significant headroom for growth. With the addition of DAXXIFY and our portfolio selling opportunities. Turning to our operational infrastructure, we are also very pleased to have bolstered our manufacturing supply chain during the quarter. In March, we received the FDA’s approval for our fill finish CMO, Ajinomoto Biopharma or Aji with approval all the inventory that was produced pre-approval by Aji has been released for commercial use and we’re in a great position to support the growth of DAXXIFY. Before I turn the call over to Toby, I’d like to provide an update on our partnership with Fosun Pharma. In April, Fosun announced that the BLA for DaxibotulinumtoxinA for Injection for glabellar lines was accepted by review for China’s national Medical Products Administration.

We continue to work with our partner in supporting their efforts to commercialize our product in China, which remains the second largest market globally for Neuromodulators. With that I’ll turn the call over to Toby to cover our first quarter and full year financials.

Toby Schilke: Thank you, Dustin. Total revenue for the first quarter 2023 was $49.3 million, representing a 95% increase from the same period last year due to increased sales of the RHA Collection and sales of DAXXIFY. Revenue for the first quarter included $30.3 million of RHA Collection revenue, $15.4 million of DAXXIFY revenue, $3.6 million of service revenue and $0.1 million of collaboration revenue. With DAXXIFY launched and Aji now approved, I’d like to note a couple of items related to our cost of product revenue, recall in accordance with GAAP we had been expecting DAXXIFY manufacturing costs incurred in our Northern California facility as a period R&D item until the product was approved. Similarly, with Aji’s approval we will begin capitalizing DAXXIFY manufacturing costs occur – incurred at the facility beginning Q2 2023.

When our DAXXIFY inventory produced prior to approval is used, we expect our cost of product revenue to increase. Turning to OpEx. GAAP OpEx for the first quarter was $107.4 million compared to $87.5 million for the same period in 2022. Excluding costs of revenue, depreciation, amortization and stock-based compensation, non-GAAP OpEx was $71.5 million for the first quarter compared to $59.9 million for the same period last year. On a year-over-year basis, non-GAAP operating expenses increased by 19% while revenues increased by 95%. We’re pleased to see our operating leverage improve as a result of DAXXIFY’s launch in our commercial growth, and as we scale our operations, we expect to continue to realize operating leverage going forward. As we previously stated, we expect our 2023 GAAP OpEx to be $460 million to $480 million and non-GAAP OpEx, which exclude costs of revenue, depreciation, amortization and stock-based compensation to be $320 million to $340 million.

Our 2023 non-GAAP research and development expense is expected to be $80 million to $90 million. Turning to our balance sheet, we ended Q1 with $273.9 million in cash, cash equivalent and short-term investments. As we have previously indicated with our current cash position, the committed additional $100 million tranche two of our note purchase agreement and our anticipated revenues and expenditures, we believe our U.S. aesthetic portfolio will be funded to break even. Finally, Revance’s shares of common stock outstanding as of April 28, 2023 were approximately $84 million with 92 million fully diluted shares excluding the impact of convertible debt. And with that I’ll turn the call back over to Mark.

Q&A Session

Mark Foley: Thank you, Toby. In closing, we are very excited about the year ahead and believe that we are well positioned to continue our growth and share gains in the facial injectable market, and we look forward to expanding into the therapeutics market upon CD approval, which we anticipate later this year. Importantly, we believe we have the right people, products and strategy that will enable us to execute on our plan and deliver on our blockbuster potential in the U.S. aesthetics market. We look forward to updating you on our progress and plan to host an Investor Day in September of this year to provide a deeper dive into our aesthetics and therapeutics franchises and our outlook going forward. With that, I will now open the call up for questions. Operator?

Operator: Thank you. Thank you. We do have a question from the line of Seamus Fernandez from Guggenheim. Please go ahead. Your line is open.

Seamus Fernandez: Great. Thanks for the questions, and congrats on the quarter. Just a couple of quick questions in terms of how the – and how many preview accounts there were sort of prior to full launch. Maybe you could just give us a little bit of color in terms of the expansion and what we’re talking about in terms of the potential number of accounts when the team is talking about going deep instead of broad? And then just a second question. I think you mentioned that you’re going to be operating with I think 150 reps in the field. Can you just maybe help us understand if that’s sort of the fully resourced field force and how many accounts you would anticipate touching with that size of field force? Thanks.

Mark Foley: Great, thanks Seamus. So in terms of the number of preview accounts, as we said previously preview was designed to be a one-quarter plan where we were going to get experience with a small group of advisors that we’re going to use the product in a real world setting. We kicked that off in December and sunsetted that when we got into March, which is consistent with what we previously communicated. And as we said on our fourth quarter near end call, we on-boarded roughly 400 accounts or so as part of the preview program. And then we said in our scripted remarks that we ended up kicking off launch in March. But that the accounts that were on-boarded prior to launch comprised the majority of the sales volume in Q1, and so we’re now moving into the full launch phase and we’re really encouraged with how everything’s tracking and evolving.

In terms of the expansion, if you look at it, we’ve been adding roughly 500 accounts per quarter. We don’t have necessarily an internal target, but that’s sort of what the sales force has been able to digest when they were kind of a 100-person sales force. So we start with the DAXXIFY launch with roughly 5,500 accounts where we have a relationship across our products and services. And given that we’ve got a relationship with those folks that will be where we start. With the DAXXIFY rollout and launch. We talked about prestige segment being the group that we’re going after with the big defining portion, there being no advertised pricing, and we said that we think that’s roughly 12,000 to 15,000 accounts. And so that will continue to be the group that we target and focus on with both RHA and DAXXIFY we launch more broadly.

And we also said that we believe that group comprises more than 50% of the facial injectable volume for toxins and fillers in the U.S. And then with regards to the 150 sales reps, maybe I’ll kick it over to Dustin to have him talk a little bit about how we think about that from a total size and number of accounts and where we’re going to go from here.

Dustin Sjuts: I think – I think, Mark, you hit it right. With the target being between 10,000 to 15,000 accounts, we feel good about this being the starting point from a rep perspective but we’ll evaluate kind of productivity each year and determine what’s the right time to add or keep going with the force you have. So we feel good about where we’re at with now, this kind of – this kind of step up from 100 to 150. This will allow us to kind of get to that next phase and then we’ll evaluate it because each territory will be slightly different from a productivity perspective in terms of number of accounts they can call on. But our focus is to continue to go as deep as we possibly can, driving that share of market within the accounts around DAXXIFY and RHA.

Seamus Fernandez: Great. And just one clarification follow-up. So it sounds like the preview account alone basically took us from the 10 million to 11 million that was booked in the fourth quarter of last year. And then the – so the incremental side was still with the sort of preview account program. And now sort of the next leg where the full launch is kind of kicking off more so from the first week of April than anything. Is that an accurate assessment of the basically what we just went through?

Mark Foley: Well it’s hard. I don’t know that I fully – we’re not going to get into the specifics. We tried to give directional commentary because we’re in the previous phase and now we’ll move into the normal launch and we’ll be consistent with how we talked about the RHA launch as well. But I think what we stated was, listen if you go back to December we had a lot of accounts that made meaningful purchases before they were really had any experience with the product. And as we said at that time, that was a pleasant surprise because most accounts will onboard a new product with a training, sampling, trial and then ultimately determining their adoption of the technology there. And because of the pent-up demand and the fact that these were the first practices to get the product, we saw early purchasing.

What was encouraging to us in Q1 though is that a majority of the sales volume in Q1 was made up of purchases from the accounts that we had on-boarded prior to launch. And so we’re now in a launch phase, which we kicked off in March. We’ve not said how many accounts those are, although we did have a bias and a preference towards onboard – towards in-person training here in Nashville. And now as we get going into kind of a more hitting our stride in Q2 in the launch, we would expect that those accounts will go through a more traditional onboarding where they will again, get trained, we’ll sample them, they’ll do trial and then they will figure out sort of their adoption curve as they move forward. But again, encouraging in Q1 based on the reorders and the support that we have from the preview group.

Next question.

Operator: Thank you. Your next question comes from the line of Balaji Prasad from Barclays. Please go ahead. Your line is open.

Balaji Prasad: Hi. Good afternoon. Thanks for the questions. Couple firstly, Mark, what changes if any have been made from your preview phase to your commercial launch phase based on any specific feedback that you got from physicians and users? Secondly, I also would love to get a sense of what feedback you add on the pricing and do you have any enough information to decide on pricing for the rest of the year? And also you commented on most orders in Q1 queue being reorders from the ones you on-boarded in December. Can you just give a more accurate split between new orders versus reorder? Thank you.

Mark Foley: Sure. So in terms of what we learned from preview, given that DAXI had only been used in clinical trials and primarily in the upper phase we are interested in really two main things as part of the preview program. One was clinical performance of the product, and the second one was practice integration, reconstitution, pricing, how they position the product to customers. And so we learn an awful lot from this early preview group and the advisory work that we did along this journey. And so what we’ve seen is that the practices are using the product consistent with other neurotoxins. We’ve seen a range in terms of how they approach it from reconstitution levels. And we’ve seen a range in terms of how they’re approaching some other areas.

But at a high level, we’ve been very encouraged by their ability to treat their patients very similarly with how they would do with other neurotoxins, while still getting the benefit of our differentiated performance profile. And so we’ve wrapped all that up and have provided forms for sharing that information. One of those that you mentioned is pricing. So we had at the outset of previews some that we’re charging 2 times their current neurotoxins, some that we’re charging 1.3 to 1.5. And I think in every given practice, they’re trying to figure out what do they think that right balance is, both for their consumers and from the profitability that they’re targeting. And as you can imagine, there’s a variety of different prices that people pay in the market that’s out there.

I would say more on average, the pricing’s settling into probably more of that 1.5 times conventional neurotoxins on average, but again you will see a range. And so we just learned an awful lot through this early phase, and it continues to reinforce, that was the right program and we were right to be disciplined and allowing a little bit of time for a smaller group to really get some experience. And as we are now going through the next – the onboarding phase of the launch we feel that we’ve been able to crisp the messaging and everything up around that side of it. In terms of the pricing going forward, we continue to feel just like with RHA that we have the right strategy for now. Where there are a couple of different price points that customers pay based on the volume that they buy at any given point in time.

Of course, longer term we’ll continue to evaluate whether or not from a bundling standpoint or other things there’s improvements or optimizations that we want to make with pricing. But we really feel like we’re being a good partner right now where we’re not obligating people to contractual minimums or anything else. And they can buy the products when they want at the volume they want to get whatever price that they think is best for them. And so we think that’s certainly the right strategy for now, and it’s proven to be the right strategy for RHA fillers. In terms of the reorders, we’re not going to get that level of granularity. It’s very early, but again I come back to, we’re just – we’re very encouraged by how the early launch is going, the feedback that we’re getting from the consumers and from the injectors, and it continues to reinforce our strategy going forward.

Thanks, Balaji. Next question.

Operator: Thank you. And your next question comes from the line of Chris Shibutani from Goldman Sachs. Please go ahead. Your line is open.

Chris Shibutani: Great. Can you just clarify something in terms of when you record the revenues presumably the volume of orders across the different clinicians is varying, so to be included within say the first quarter, it sounds as if there was very little in the way of expanded accounts at the end of March there. Again, when do you actually recognize the revenues on that? And then a question in terms of the therapeutic opportunity there. Again, can you give us a sense for perhaps the relative scaling of how you go from, I can understand the aesthetic side, having a bit of a prestige segment. I’m less familiar with how that would go in terms of the therapeutic aspect, some dimensioning and sizing of what the cadence of training and ultimate expansion into the therapeutic opportunity that’s going to look like. It sounds like you have a similar framework, but I’m most familiar with the dimensions?

Mark Foley: Sure. Thanks for those, Chris. So in terms of revenue recognition, we recognize revenue when the practice precedes the order. So we take the order in, we ship the product and we don’t recognize the revenue until they’ve actually received it. And again there’s no third-party or middleman results in stocking or other things. And these are accounts that try and manage their cash flow wisely, and you’ll see different ordering patterns. Some like to order on quarterly, some order on a monthly, other sort of order as needed, and so we recognize the revenue when it is received. And then on the therapeutic side, as it relates to the cadence of the preview launch that we want to do there, the one difference for therapeutics program versus aesthetics is the reimbursement piece.

And so we have put in place the market access team who’s already started working with providers to grease the skids there to make sure that when we get approval that we can get this in as frictionless as possible. But given that cervical dystonia is a condition where typically injectors start low on the dosing side and then increased dosing over time based on how well the toxin works. We will get into that more in our Investor Day in September, but there will be some subtleties and differences there. But we believe that we’re putting the right infrastructure in to make sure that our preview program focuses on high volume injectors, that we get the necessary information that we need to lay the foundation for a successful launch. Thanks, Chris.

Next question

Operator: And your next question comes from the line of Stacy Ku with Cowen. Please go ahead. Your line is open.

Stacy Ku: Hi, thanks for taking our questions and congratulations on a nice progress.

Mark Foley: Thanks Stacy

Stacy Ku: First, just a follow up on a previous question. Hey, can you discuss in more detail how that original training from the preview program is now informing specifically the messaging to the broader clinician group? So, any additional nuances about refining the dose, particularly in other areas of the face and messaging of expectations the patients would be appreciated. You’ve spoke previously, but any updated thoughts would be very helpful. And then based on your commentary, it seems like the different pricing tiers and incentives do include situations where the practice might be able to profit even more on DAXXIFY than BOTOX. So how should we be thinking about those higher volume orders as we think about the broader practices?

Is that a possibility for the majority of these 5,000 accounts as we think about the long term? Is it fair to assume over time the majority of accounts will ultimately be in that highest volume of tier to get that 10% premium pricing as we talk about deepening the accounts? And then last question for Dustin, you’ve discussed the potential of DTC on the second half this year with the broader launch. So, can you just talk about the balance of leaving it to the individual clinicians and practices to communicate expectations regarding DAXXIFY’s aesthetic profile versus some of the other – maybe type of other messaging with key learnings from your preview group? Thank you so much.

Mark Foley: Sure. So Stacy, I’ll hit the first two and then hand the third one over to Dustin on the DTC. So, in terms of the original training and what we learned through preview and how we’ve incorporated that in, I’ll hit one for example, on the pricing side of it. Again, it’s hard to know for sure in terms of what others are paying. So we say on average we think we’re going to be about 10% to 40% more expensive to the practice than the market leader out there. And so then it really depends on what – how much they buy from us, because they’ll get – their pricing from us will depend on how much they buy at any given point in time. And that can sort of vary by 20% based on whether they buy the least amount or the greatest amount of product.

And we haven’t publicly published it, although obviously all the different providers have that information. So, anytime they make a buy from us, they’ll have to make a decision on how much product that they want to purchase based on what pricing tier that they want to fall into. One of the things that we have shared, for example, in the full launch is the learnings that we have from pricing where we said originally practices we’re pricing at a variety of ranges from, you know, call it 1.2 to 2 times their cost of their current toxin. And instead what we’re finding is most are settling into that 1.5 times range. And so it’s a lot of things like that where we talk about some of those learnings on the practice integration side where we’re able, what we think to make the on-boarding of these next round of accounts more efficient and more effective based on the learnings from that original group.

And so, on the pricing tiers and the high volume, you asked, do we think that the practices that we’re selling into are going to fall into the higher price tiers? I assume you’re meaning on our side. Again, that will depend on typically how they buy. Some, frankly will care less about buying the highest tier to get the best price and would rather only buy product when they need it so that they don’t put as much inventory on the shelf. Others will try and optimize and will buy more and might be comfortable buying once a quarter, for example. And so again, right now on our pricing tiers, we think they are the right tiers for us to have at this stage. And again, they don’t obligate practices to make any long-term commitment to us very similar to the RHA side.

And then I will throw it over to Dustin on the DTC side.

Dustin Sjuts: Well, first I would like to say on the consumer side, we’ve been very happy and pleased with what we’re hearing around the social channels and how patients are liking their treatment with DAXXIFY. We’ve also been in market testing some messaging as it relates to our novel peptide formulation and those messages that resonate best with that consumer. So we feel good about coming out of those message testing that will likely provide our sales organization as well as our accounts, more digital marketing assets, more direct-to-consumer assets that can be augmented both via the practice but also outside to provide that awareness that providers will want for consumers walking in talking about DAXXIFY. So, we’ll be looking, doing more of that in the back half of the year.

The great thing is that for the first time we now have a message that’s different than any other neuromodulator in the marketplace, and we feel like there is an opportunity to leverage that uniqueness today and look forward to sharing more of that as we give in the back half of the year.

Mark Foley: Next question.

Operator: Thank you. And your next question comes from the line of David Amsellem form Revance Therapeutics . Please go ahead, your line is open.

David Amsellem: Actually I work at Piper Sandler, not Revance.

Dustin Sjuts: I was going to say.

David Amsellem: Yes. Maybe I’m moving up in the world. So, couple of questions. A couple things I wanted to clarify in case I missed them. First, can you talk about how many accounts at present above and beyond preview that you’ve trained? I don’t know if I missed that or if you’re disclosing that. Then secondly in terms of the training over time, how much of it do you think will be in Nashville versus at the practitioner site? And how will that mix evolve as the year progresses? And then lastly, just an RHA question, taking a step back, I mean, the product obviously had a nice ramp. And I think in Europe the share is something around 10% or so. So how are you thinking about overall peak share for RHA in the United States? Just latest thoughts there would be helpful. Thank you.

Mark Foley: Sure. So in terms of the number of accounts we’ve not disclosed how many total accounts we’ve now trained between preview and the launch in March. And I don’t expect that that’s something that we will give at least for a little while going forward. We’ll talk just like we have with RHA and with our Opel platform or a total number of accounts. And there is two reasons for that. One is competitive reasons, and number two is you’re aware we’re not able to roll the product out to everybody all at once. And so we do have some accounts that obviously are anxious to get the product and we’ve not been able to onboard them yet. And so we won’t be disclosing that and we didn’t disclose that at this point.

But if you look at higher level in terms of our ability to onboard accounts as we said, there’s several steps that you want to go through to ultimately result in reorders and reorders. And that’s training is step one, sampling is step two, trialing of the product and bringing patients and getting sort of whatever comfort level the practice wants and then that turns into orders, reorders and adoption. And so, we would expect that the group of accounts that we’re now onboarding is going to behave more traditionally in that fashion versus what we saw from their preview group where we saw big bolus orders out of the gate without having any experience with the product because of the excitement and the patience that they had. And so we would expect that to continue to be the predominant way that people onboard over time.

In terms of the mix between in-person and virtual, listen, we want to provide flexibility for our customers to engage them in the most appropriate way possible. And virtual will be also key for training additional folks within an account. So, you might have somebody that came here in person to Nashville to get trained, but then they have other injectors or they want other people in the practice to get trained. And having a virtual option will be important. We will continue to prioritize Nashville Experience Center because we just think that we can provide a better experience and can provide a more focused, dedicated period of time where we think the onboarding process is likely to be more effective. Having said that, we, we recognize that in order to meet the pace of onboarding that we want and to get access to all the different injectors that we want, the virtual piece of it makes a lot of sense.

So, on the front end we think it’s going to be more weighted to in person, but in fairness, probably as we go out over time virtual, we’ll probably take on a more predominant role in that. And listen, my guess is we’ll probably have follow-up and Version 2 of trainings too once people have had it for a while in terms of tips and tricks and things that people have learned out there just like that we’ve done with RHA. And I would think that both formats will be effective in allowing us to do that. In terms of RHA, you are right, when we licensed in RHA line of fillers from TEOXANE, we did say that they had at that time sort of 9%, call it 10% market share in the top five EU markets. And we sort of said aspirationally that that’s a good goal for us.

If you look at where we, exited Q4 and where we are in Q1, we’re kind of right up on that right now and we continue to see that we’ve got a lot of room to run. We’ve talked about the prestige segment we’re going after, which is this 12,000 to 15,000 accounts and we’ve been able to kind of get there with the call it fifty five hundred accounts. Now clearly those groups that have leaned in with us first are probably the ones where it’s going to be more straightforward. DAXXIFY will definitely open up some doors for us, now that we’re out in the market. So I don’t know that. We’re at a point where we’re comfortable giving guidance around peak share, but we definitely feel like there is still a lot more room to run with the RHA collection.

Next question please. Hello? Next question.

Dustin Sjuts: We can hear you, Mark.

Mark Foley: Okay. Just waiting for operator.

Operator: My apologies. Thank you. Your next question comes from the line of Annabel Samimy from Stifel. Your line is open.

Unidentified Analyst: Hi, this is Stacy calling in for Annabel. Congrats on the great corner. And just two questions on our end. I guess following-up on a previous question realizing that you didn’t train physicians in January or February at preview. Did you train any virtually during that time? And how rapidly did the training pick up in March as you fully launched? And are you now in a position to restart the therapeutical clinical trial such as moving upper limb forward into Phase 3, or are you considering other indications or waiting for approval of CD and the initial stages of commercial launch? Thank you.

Mark Foley: Sure. Thanks Stacy. So, on the preview side, as we’ve indicated, preview is a one quarter program really designed to roll the product out to a limited number with the focus on kind of here is the early thoughts that we have, here is the messaging and letting them get experience. So we talked about the numbers that we onboarded as part of that. We did have some virtual training that we had, again to help educate and train some additional injectors that were in practices where they had attended on site. But really now that we’re rolling into the launch in March the priority there was in-person trainings, but we did onboard some accounts in March virtually as well. And so, we’ll continue to evaluate the right balance there, but feel again that the priority is going to be on in person.

In terms of clinical trials for other therapeutic indications, what we’ve indicated is given that we wrapped up the Phase 2 program in ULS and have clarity from the agency in terms of the Phase 3 program, we’ve indicated that we’d like to get into the market with CD to better understand our ability to drive adoption and penetration in a therapeutic category with the differentiated performance profile of our product and how that informs additional therapeutic indications and strategy. And again, we’ll get into that more in our September Investor Day as well, but that’s the current thinking at this time.

Unidentified Analyst: Amazing. Thank you. That’s very helpful.

Mark Foley: Thank you. Next question.

Operator: And your next question comes from the line of Terence Flynn from Morgan Stanley. Please go ahead your line is open.

Terence Flynn: Great. Thanks so much for taking my questions. Maybe a couple for me, I was just wondering if you can comment at all about April trends versus March in terms of what you are seeing at this point. And then any early insight on the durability. I know you made some comments there marked on your prepared remarks, but just wondering if what you’re seeing is in line with the clinical profile or maybe better if you comment at all about that. And then Toby, just remind us how you’re thinking about revenue guidance. Is that something we should expect in 2024 or is it possible at some point later this year? Thank you.

Mark Foley: Thanks Terence. In terms of April trends, as you know, there is always seasonality in the aesthetics business Q1 and Q3 being the slower quarters, Q2, Q4 being stronger quarters. At least in the lens that we have and the accounts that we’re calling on, we’re not seeing any weakness in terms of procedure trends and volumes. And so, we continue to be encouraged by the procedure volumes that we’re seeing in the accounts that we’re calling on. And we’re now in launch mode and encouraged by the ongoing interest and support for DAXXIFY as we work our way through the launch phase. So it’s early, but we would expect that we’ll continue to see those aesthetic trends where Q2 will be a stronger quarter than Q1.

In terms of the duration, yes, right now the results that we’re seeing and the feedback that we’re hearing is very consistent with what we expected and what we’ve seen in our SAKURA program, where the medium duration six months and you’re seeing – we’re not far enough out to see how far patients go out, but with media duration, you’re going to see some that get less than six months and some that get more than six months, which is going to be the same with other neurotoxins where you see a little bit of a range around those. So, thus far we’re encouraged with what we’re hearing out there in terms of duration profile being very consistent. And then Toby I’ll throw it over to you in terms of the revenue guidance.

Toby Schilke: Yes, I think, we had stated at the beginning of the year that we were going to put a pause on giving revenue guidance at this juncture, just given the interplay between RHA collection and DAXXIFY. And the dynamic of launching a brand new long-lasting neuromodulator in the U.S. market. I think we said on our prepared remarks that we would provide a little bit more outlook in our September Investor Day that we’re planning on hosting. And then from there we’ll continue to give guidance I mean to give consider giving when to give guidance.

Terence Flynn: Great.

Mark Foley: Thanks Terence. Next question. Operator, next question.

Operator: Thank you so much. At this time, there are no further questions in the queue. I would like to hand back to our speakers.

Mark Foley: Thank you everyone for your time and we look forward to interacting with you in the upcoming months ahead. Thank you very much.

Jessica Serra: Goodbye. Hello is the operator on?

Mark Foley: The call has ended.