Evoke Pharma, Inc. (EVOK) Earnings Call Transcript & Summary

Good afternoon, and welcome to the Evoke Pharma Second Quarter 2022 Earnings Conference Call. [Operator Instructions] Please be advised that today's call is being recorded. I will now turn the call over to Daniel Kontoh-Boateng. You may begin.

Good afternoon, and thank you for participating in Evoke Pharma's conference call today. With me today are David Gonyer, Evoke's Chief Executive Officer; Chris Quesenberry, GIMOTI's Chief Commercial Officer from Eversana; and Matthew D'Onofrio, Evoke's Chief Business Officer. By now, you should have a copy of the press release we issued earlier. If not, it is available on the Investor Relations page of our website at evokepharma.com. We encourage everyone to read today's press release as well as Evoke's quarterly report on Form 10-Q, which is now filed with the SEC. The company's 10-Q report and press release are also available on Evoke's website. Please note that certain information discussed on the call today is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. We caution listeners that during this call, management will be making forward-looking statements. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in Evoke's press releases and SEC filings, including its annual report on Form 10-K and subsequent filings. This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast. Evoke undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. With that, I would now like to turn the call over to Dave Gonyer. Dave?

Thanks, Daniel, and thank you all for joining us today. I'll be providing updates on key developments that have occurred during the second quarter ending June 30 and thus far in Q3. I'll then turn the call over to Chris and Matt to discuss commercial operations and financials. I'd like to first begin this afternoon with a key and important data point. During the second quarter, our pharmacy and patient support program received the largest number of inbound quarterly prescriptions to date with more than 500 patients. That's an increase of 24% compared with the first quarter of 2022. Why is this so important? This patient support program provides patient access to pharmacists and nurses, support for benefit verification and prior authorization and is critical to patients obtaining access to the medicine their provider prescribed for them. We see this program in partnership with the vitaCare prescription services as a patient portal to the entire health care universe with vital touch points that provide a seamless and reliable patient experience to optimize their benefits and ensure that patients receive their prescription at the most affordable cost. We've now converted our reimbursement program primarily over to vitaCare, which is a wholly-owned subsidiary of GoodRx. This program will serve as a valuable indicator of GIMOTI prescription [ fills ] for the second half of this year. Chris will discuss how we believe vitaCare and other partnerships enhance our second half outlook and beyond as well. One significant feature of our hub platform is the streamlining of the complex process to submit and receive approval for medicine for both providers and patients. So patients can start their medications more quickly. This is critical for patients with gastroparesis, who are symptomatic and are looking for relief. As our customers navigate insurance coverage, positive coverage and reimbursement decisions that open access to GIMOTI is critical. The recent announcements of the new state Medicare approvals in Texas and Florida are so important as these states provide services to approximately 10 million or nearly 16% and of the Medicaid population nationally. And what's more, Texas and Florida add to the list of other state Medicaid approvals, including New York, which we announced in Q1 of this year and Michigan prior to that. We're pleased with the progress and access for the Medicaid population as it represents a recognition of value and lit alternative of options for patients. We'll continue to update, monitor and track utilization in all these government programs. And on last quarter's call, we mentioned that Evoke was granted FDA market exclusivity in April. As a result, Evoke has exclusive U.S. marketing rights over a 3-year period beginning on GIMOTI's FDA approval under the Hatch-Waxman Act to protect the product from generic competition. Our proprietary position regarding GIMOTI, got a boost in July when we announced that Evoke was awarded a Canadian patent covering the method of use of GIMOTI. Importantly, the new protections in Canada mirror those granted in the U.S. The new patent adds to 2 other FDA Orange Book-listed patent under the same title that don't expire until 2029, 2030. Another positive development during the quarter was the May announcement that our first-ever patient-centric survey conducted by Evoke and Eversana reported increasing patient awareness, trial and product usage of GIMOTI. I'll let Chris tell you a bit more in a moment, but overall, these data gathered from patients are promising and clearly show the vast potential value GIMOTI provides to people suffering with symptoms associated with gastroparesis. Last month, I was able to meet with several key opinion leaders in gastroparesis. And in conjunction, also spent a few days working with some of our sales representatives out in the field, meeting with gastroneurologists, physician assistants, nurse practitioners and medical assistants across the country. The reception and feedback I received was quite rewarding, very encouraging and rather humbling as it relates to patients struggling with gastroparesis and how GIMOTI is helping. And this mirrors what we've heard in both HCP and patient market research. My experience out in the field allow me to speak, discuss and further understand the benefits that GIMOTI [indiscernible] with frontline health care providers firsthand. It also provided me the increased confidence for GIMOTI's important and needed place in the treatment of patients with gastroparesis for today and for the future. In May, Evoke also participated at Digestive Disease Week, which is the largest global conference for gastroenterology, and we are gratified to present a poster of distinction to scientific and clinical experts and key opinion leaders that provided real-world statistics using the largest claims database available, which covers over 80 million lives in the U.S. to assess the incidence of TD, including patients taking Metoclopramide over a 10-year period. Results for patients that receive Metoclopramide demonstrated a lower risk of developing tardive dyskinesia or TD than stated in previously reported studies. The data showed 98.8 per 100,000 incidences of TD or just 0.1% among gastroparesis patients treated with Metoclopramide. The poster supports the safety profile of Metoclopramide is the only approved molecule in the U.S. to treat symptoms of acute and recurrent diabetic gastroparesis. The aim of the study was to update the medical literature with current information about the incidence of TD in patients with and without gastroparesis and those taking Metoclopramide. By supporting the largest ever real-world study on this important issue, we hope these data help HCPs and organizations understand the incidents of TD, recognize patients who might be at a higher risk and revisit the benefit versus risk of this important compound in patients with gastroparesis. In the second quarter and now in the third, we continue to expand access to demoting collaboration with Eversana and other partners that will help us access patients who need help with their disease. I want to add to what we said in Q1 about our partnership with vitaCare, which I referred to earlier. vitaCare is an e-prescription service that provides an effective, quick and convenient way for patients to receive medications. This platform is meant to help patients navigate key access and adherence barriers for brand medications like GIMOTI. While the specifics of a deeper long-term partnership are still being discussed between vitaCare and Evoke through Eversana, we've expanded the service from a pilot in February to full-scale launch in May, which has contributed to the increase in prescriptions, especially inbound. And specifically, vitaCare helps patients understand coverage and identify available savings opportunities as well as facilitating communications between providers and payers. The last key developments I'd like to touch on were our successful efforts to regain NASDAQ compliance and improve Evoke's cash position. On June [ 11 ], we received notice from NASDAQ stating that we had regained compliance with a minimum $1 per share requirement. And as we also disclosed earlier in May, Evoke utilize its ATM or at the market facility to raise net proceeds of approximately $7.1 million. And this extends our cash runway into the second quarter of 2023 with approximately $13.5 million in cash as of June 30. And with that, I'll turn the call over to Chris. Chris?

Thank you, Dave. The second quarter has been a strong quarter of progress on many measures. Performance-wise, we had the strongest quarter-to-date with 24% increase in prescriptions. In addition, the number of GIMOTI, new cumulative prescribers increased by 23% from 543 at March 31 to 669 new prescribers at June 30 of this year. As I look back to the beginning of this year, our growth is at the strongest pace since January compared to any time period since launch. In fact, we have already exceeded our dispense total for all of 2021 through the first half of this year. There are several contributing factors to this, including improved brand messaging, stronger execution from our sales team and key initiatives to streamline the prescription process for patients and providers. One of the more significant changes to our business was our change in distribution via a partnership with vitaCare Prescription Solutions, which is now owned by GoodRx. The primary reasons for partnering with vitaCare were to simplify and streamline the prescribing process for providers, integrate prescribing into their workflow and leverage vitaCare's automated platform to adjudicate claims. In addition, we wanted to communicate with providers and patients and provide auto shipments to patients who requested it. Ease of prescribing and speed to therapy are some of the most important drivers of utilization for our customers. And we feel this was an important change to make for the long-term health of our business. When making such a significant change to a key process, there are always inherent challenges and you run the risk of slowing your performance in the near term. Overall, we see sustaining or improving performance. And based on these learnings and performance from the pilot program, we launched a full-scale rollout to all of our customers on May 2. Prescriptions via vitaCare already account for 62% of the prescriptions through the end of second quarter. The rate of prescription growth for vitaCare prescriptions is 2.3x the overall growth of prescriptions of GIMOTI since the launch. I'm going to spend a good amount of time on the second piece here, which is patient awareness and what we've learned about this. In the second quarter, we conducted our first patient ATU study, which stands for awareness, trial and usage. And this surveyed 110 patients that were representative of patients with gastroparesis including those with and without diabetes. 70% of respondents experience flares generally defined as sudden, acute and more severe periods of GP symptoms. Diabetic gastroparesis patients experienced up to 13 [ players ] on average each year, and most of these patients have taken medications for their gastroparesis, including many that take multiple medications. Roughly half of users report no symptom improvement from either oral tablet or liquid metoclopramide or other off-label medications. As a result, 38% of respondents discontinued those GP medications primarily due to either side effects or lack of symptom improvement. One fundamental issue among patients is difficulty with taking oral GP medications with 50% of respondents saying that they've had a tough time taking orals. So it's not surprising that diabetic patients, diabetic gastroparesis patients indicated strong interest in trying a non-oral option. Patient awareness of GIMOTI has risen to 9% of patients compared to 8% awareness last fall. Of those patients in the study who were aware of GIMOTI prior to the survey, 43% are current users. GIMOTI rated higher and experience scores across symptom relief, side effects and ability to keep medication down compared to every other medication that was rated. 100% of GIMOTI users reported seeing at least some symptom improvement on the nasal spray. These latest patient data underscore the unmet need within gastroparesis and reinforce our need to reach these patients with education and helping them to understand there is a non-oral option for them. Moving to physicians. The feedback from the Eversana sales organization continues to be positive with regard to physician interest. Since product launch, it's taken on average 6 to 7 physician details before a physician writes their first prescription, which is lower than we initially expected, and we believe congruent with a straightforward non-oral benefit for route of delivery. We are seeing improved access in the second quarter, which allows us to reach more health care providers. New prescribing physicians increased 23% compared to the prior quarter. HCP awareness stands at 80% of target GIs and awareness among nontarget GIs, primary care physicians and MPs and PAs have all risen since January. The most notable increase in awareness is among nurse practitioners and physician assistants, which increased from 60% in the fall to 81% awareness in the most recent survey. Strong awareness of our product, which is a score of 4 or 5 out of 5 is generally a leading indicator of prescribing and that has also risen to its all-time high of 55% of strong awareness among all HCPs from 48% at the beginning of the first quarter. In January, we instituted new targets for our field sales team enhancing the potential of their targets overall and including NPs and PAs who are colocated within GI practices. They account for a significant portion of the medical management of gastroparesis. NPs and PAs and other non-GI specialties continue to increase their contribution of total prescriptions for GIMOTI. Although we continue to obtain new prescribers, our reliance on new prescribers is lessening, with most prescribing coming from ongoing prescribers. 59% of our prescriptions overall came from HCPs who have written at least 5 or more prescriptions for GIMOTI. In the second quarter, we accelerated our speaker programs and trained both GI and nurse practitioner and physician assistant speakers, and we are pleased with the initial attendance and educational impact of these programs. Also in the second quarter, we updated our physician campaign and messaging. This campaign is a natural evolution from our spray-away symptoms campaign, which focused on the route of administration for GIMOTI and the benefits of bypassing the GI tract. Our new campaign, which is titled The Right Delivery, so it can work, focuses on more on the differentiation from oral therapies that are at the mercy of erratic absorption and thus may delay symptom relief. In early August, we plan to launch our new patient campaign. Similar to the evolution for HCPs, we are moving from spray-away symptoms to think outside of the toolbox. Patient feedback this campaign via [ Marco ] Research was very well received. When patients saw the profile for GIMOTI and our new campaign, they indicated an overwhelming interest in learning more about GIMOTI, rating their interest of 4.9 out of 5, which is unheard of. We're continuing to make progress on the access to GIMOTI among insurance companies and pharmacy benefit managers. While coverage and reimbursement held steady, we continue to have productive dialogues with payers through our capable national account teams. Importantly, we expect plans to want to drive generic utilization for patients and would require patients to try oral therapy first. Our position is to work with payers to allow access for patients who cannot take oral or for those who's oral's provided inadequate response. As Dave mentioned, Florida has recently added GIMOTI to the preferred drug list and medicate is an ongoing opportunity for us. To date, at least 97 plans have approved at least 1 prescription for GIMOTI since launch, and 54 plans have approved GIMOTI in the second quarter alone. While the majority of prescriptions were prior to our authorization, we are improving our ability to gain approval across commercial, Medicare and Medicaid payers. It's important to note that when a prior authorization is approved, it's generally approved for a year. We expect to gain positive decisions and improve access from payers over time. As they see demand grow, experience how GIMOTI patients respond clinically and are educated on the needs of this patient population, and the differences between oral and nasal [ route ] administration, we believe they will understand the proposition of GIMOTI. As I close out the commercial update, I'd like to summarize a few key points. Awareness of GIMOTI is high among providers and growing along patients. Strong awareness is what we are targeting, and you can expect us to work even more diligently to encourage patients to request GIMOTI and provide them tools to facilitate the dialogue between physicians and patients. We have learned a great deal about what has led providers to decision to prescribe, and we are enhancing the positioning and messaging of GIMOTI to more clearly differentiate from oral therapies. Our performance continues to steadily improve in terms of reach and access to providers prescription volume, number of new and total prescribers, breadth of prescribing from different specialties and depth of prescribing among other leading indicators. Our goal is to increase the percentage of our utilization within moderate and severe patients and firmly cement ourselves as second line behind generic. We are showing signs of progress among specialties with the greatest response from targeted GIs and NPs and PAs saying, they preferred to use GIMOTI as second line 40% and 44%, respectively. We have taken significant strides to improve the access to GIMOTI, enhance patient and provider experience through programs, including our partnership with vitaCare. We will continue to provide patients saving support and expect to improve coverage over time. And lastly, we continue to work on improving the conversion rate of prescriptions into the dispensers via vitaCare and other efforts. This conversion hinges on coverage and coverage decisions via prior authorization, which needs to be completed and submitted by the physician offices. We have a significant focus on this to help support the office staff and completing these in a timing fashion. This coordination is important and is critical to speed of therapy for patients. On this metric, we have improved speed to therapy to 12 days within vitaCare compared to 20 days historically for our program. With that, let me turn the call over to Matt to discuss financials.