Mayne Pharma Group Limited (MYX) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to the Mayne Pharma Group Limited Investor Education Webinar, Women's Health and Dermatology Strategic Focus. [Operator Instructions] I'd now like to hand the conference over to Mr. Tom Duthy, Investor Relations. Please go ahead.

Good morning, and welcome, everyone, to today's interactive Mayne Pharma webinar discussing the company's women's health and dermatology businesses with several key U.S. executives joining us alongside Mayne Pharma's CEO and Managing Director, Shawn Patrick O'Brien; and CFO, Andrew -- Aaron Gray. I will be moderating today's webinar with investors and analysts. To be clear before we begin, today's webinar is not a session where the company will be answering specific questions relating to the financial performance of the business overall or its segments thus far in FY '25, which includes product-specific sales information or forecast. The webinar is designed to educate new and existing investors on our Women's Health and Dermatology segments and the key strategies and drivers for success and growth. The company will provide a trading update on the business at the upcoming Annual General Meeting to be held on 21 November 2024. The notice of meeting was dispatched to shareholders on the 18th of October. We thank you for your understanding on this matter. Today's format will be as follows: our CEO, Shawn, will provide a quick snapshot of Mayne for those investors who are relatively new to the story, and he will formally introduce today's speakers. Following on, there will be a 15-minute presentation for our Women's Health business, followed by a 15-minute presentation on our Dermatology business. We will then conduct a consolidated interactive Q&A for both segments together, which is a slight change to the order which we had previously communicated to the market. On the webcast page, there is an ask a question box, please type your question into this box and press submit and we will attempt to answer your question or where there are questions of a similar nature, we will aggregate them and ask them in singularity. In addition for those phoning in via the operator, I will direct the operator to open the line and participants can ask a question. Any questions we are unable to address due to time constraints, we will make every effort to come back to the questioner provided the relevant details are collected. With that, I would like to now turn the webinar over to Shawn. Please go ahead, Shawn.

Thanks, Tom, and thanks, everyone, for joining us. We look forward to answering your questions on how we are delivering on our turnaround journey. That journey is to a higher growth, higher margin, less capital-intense business focused on growth in women's health and dermatology in the United States. The next slide. Our objectives for today's session is for you to see we have a solid approach to drive profitable growth for both dermatology and women's health in the United States. But you're confident we have great people to execute this strategy. We have a differentiated line of products that meet the needs of our patients and providers, and we're a customer-focused business on both patients and providers that allow us to make great business decisions and drive the business forward. Last August, I shared the performance of the business, where our business was up 112% to $388.5 million. This was driven by our 3 business segments: Women's Health, $142 million, up 131% compared to FY '23. Our Dermatology business of $174 million was up 207% and our International business delivering AUD 70 million was up roughly 9%. The company is trading roughly on 1x sales with a share price of $4.53 on the last previous close. Business has had a long track record of innovation over the years as an AASB-listed pharmaceutical company, but we've changed the business, and we believe it's in a strong turnaround position for rapid growth in both dermatology and women's health in the United States. Next slide. If you look at the contribution delivery, it's a material improvement over the previous fiscal year. We had Dermatology having a negative contribution in FY '23 of $21 million; Women's Health, $27 million and a positive contribution of roughly $7 million from International. Collectively, a negative contribution for these 3 business units of roughly $42 million. We improved that by $130 million in FY '24 to $88.5 million, driven by our Dermatology franchise at $44.3 million and $35 million coming out of our Women's Health and $9 million coming out of our International business. Today's conversation is focused on how we're driving this rapid growth in Dermatology and Women's Health and continue to drive significant profit. Next slide. I wanted to introduce to you our speakers for today. Tony Ramy joined as Vice President in Sales and Women's Health just this year back in February. Tony has over 27 years in women's health leadership and has made remarkable changes to our go-to-market strategy for the entire women's health franchise. Chad Turner also has been in the industry for 25 years and has been with our team for almost 8 years and has significant women's health marketing and sales leadership with many companies in the U.S. We have 4 products that we market here in the United States. Bijuva and Imvexxy are our menopausal products, Nextstellis and Annovera our contraceptive products. You'll hear more details from Tony and Chad on how we're winning with all 4 of these products. Next slide, I want to introduce our great leadership here in Dermatology. Meredith Gambill has been in the industry for over 15 years, focused on dermatology and has been with us for roughly 8 years. Meredith not only leads the sales team, but also the marketing efforts for our Dermatology franchise. Daniel Moore has been with the business for roughly 9 years and in the industry for 12 years, and he's our Executive Vice President of Specialty Products and Patient Solutions. We have 4 passionate and well-capable leaders driving our business here, and that's going to come through loud and clear as you listen to them. They are top-notch leaders in our industry, and I'm excited for them to present to you and then open the opportunity for your questions so you can see how we're driving this turnaround story for Mayne Pharma in the United States in women's health and dermatology. So let me turn it over to Tony and Chad to lead off with the women's health. Tony, Chad?

Thank you, Shawn, and good morning, everyone. So if you advance to the next slide. So as Shawn noted, Mayne Pharma on the women's health side competes in 2 key women's health sectors, the menopausal market as well as the contraceptive market. Mayne today is incredibly well positioned to continue the success that we've already started. So there's 3 big takeaways that I want everybody to have from this side. One, we are operating in a growing segment. If we look at the far left side, we see that the outer year growth out till 2030 sees a positive compounding annual growth rate. So that certainly lets us know that we're in the markets that we need to be in. The second big takeaway is the patent protection that we have. So in taking a look at the middle sector, our last Orange Book listed patent expiry goes all the way out to 2039, and all 4 of our key brands have significant life ahead of them. And when I reference the Orange Book that essentially is the FDA's standard repository of approved drugs. And what it does is it captures all the patent filings as well as any of the therapeutic equivalent products that may have an AB rating or a generic rating against them. The third key takeaway and probably the most important is that we have incredibly differentiated brands that meet a need for our patients in the segments that we operate. Bijuva being the only bio-identical combination product for the treatment of vasomotor symptoms. IMVEXXY, the only 2-dose product that affords us the opportunity to provide the absolute lowest dose for local estrogen use. We've Nextstellis, the only contraceptive product with a selective estrogen. And then we've got Annovera, the vaginal ring contraceptive system that can be used for an entire year. So we certainly feel very confident in where Mayne Pharma sits today and what the future looks like. Next slide, please. So to dive a little bit deeper into the contraceptive segment, a couple of things here. So one of the interesting things about this space over the last 15 years or so is that there really has been a gap in innovation, and there's been a gap in development. And so what we've seen is a lot of the major players in the space have exited. And what that has done is that has left an opportunity for the small to midsized companies to fill that gap. And certainly, Mayne is doing that. We have 85 incredibly talented sales representatives. Again, we have a diverse offering of products. And if we look across at the competitive landscape, we really see a lot of the major players that I talk about either downsizing as we've seen with Abbvie and Organon. And we've seen some of these smaller companies begin to fill the void. So if we look forward at some of those key drivers that will point to the success that we expect to continue to drive, it really comes down to having a best-in-class sales force, having top field sales leadership. And then it comes down to the key brands that we have. Obviously Nextstellis containing a very unique progestin and drospirenone combined with a very selective estrogen in E4 and Annovera being the only annual controllable contraceptive option. So as we move to the next slide, we'll take a little deeper dive into what the menopausal landscape looks like. And on the hormone therapy side, things are slightly different. We still have some legacy players and Pfizer and Bayer who still have a presence. And we have a few newcomers, so Exeltis being one of them. And what we're really seeing is these legacy brands have continued to maintain share. And we've also seen some innovation in the non-hormonal space. The exciting thing for us is that as things continue to evolve in this space, it continues to be very clear that hormones are the gold standard for the treatment of vasomotor symptoms, and we are, again, very well positioned to execute and drive results. Again, I talked earlier about Bijuva being the only bioidentical combination available in 2 doses. And then Imvexxy, we have the flexible dosing with both 4 and 10 micrograms for local or vaginal use. Moving on to the next slide. I'm going to hand it over to Tony now to provide a little more detail around our sales and execution.

Thank you, Chad, and thank you, Shawn, and welcome, everyone. I want to talk a little bit about our aspiration to go from a women's health care company to the women's health care company and how are we going to get there? Well, today, performance in our operations are improving, but how are they improving? And why are they improving? It's because we've built this one team mentality in the Women's Health business unit where everybody is pulling on the rope the same way. Everybody is working hard with one goal in mind to get more of our products in the hands of our patients in any manner, shape or form. Now let's talk about tomorrow. Chad talked about it. Our portfolio addresses the market needs, and everybody knows the menopause market is a growth driver and will be a growth driver for our organization moving forward. Now let's talk about the future; our future and our aspiration to become the women's health care company. We can do all these things, and it really is relevant whether we think we're the women's health care company. We want to be the women's health care company in the hearts and minds of our customers and most importantly, with the patient. If we do that, we will be successful, and I know we're going to get there. Next slide, please, [ Laura ]. I want to talk about our territory coverage. We have a very flat sales organization. I'm the Vice President of Sales and the 10 regional sales managers report directly up to me. It allows me to be very close to the business, very close to our -- my sales reps and very close to the most important piece, which is the customer. Now these 10 regional sales managers, we've had -- I've put 6 new regional sales managers in place since February. We've had 3 internal promotions. These are top flight sales representatives and also high potential leaders in our organization, they were promoted to the position of regional sales manager. I also brought in 3 incredibly talented people from outside of our organization, one from Organon, one from Abbvie and one from Novo Nordisk. And I've been in this business for 27 years of leadership, and this is the most talented regional sales manager team I've ever been involved with. Now down one level from that, each have a span of control of 8 or 9 sales representatives. So we have 85 sales representatives, and they cover the vast majority of the metro areas and high decile providers across the United States. Additionally, we just added 2 associate sales representatives. And what's their role going to be? They're going to be out there. So if we have a vacancy or a rep that's on leave for whatever reason, they will work in that territory and show we have continuity of business. Additionally, if there's white space where there's an opportunity, they can also go work in their area for a while to look for new business opportunities. And additionally, we have one inside sales rep who covers strictly on white space from an inside sales representative role. Next slide, please, Laura. I want to talk about execution. That is what we own as a sales business unit. I want to talk about execution at the end of fiscal year '24, which is quarter 3 and 4, our fiscal year ended June 30, as many of all of you know. So in quarter 2 and quarter 3, right before I started, there was really a high focus on getting signatures and samples. The team did an outstanding job sort of priming the market, getting out there, ensuring that all the key providers had the samples they needed and were interacted with by a main employee. Now when I came in and said, okay, let's modify that a bit. Let's go from the sample signatures. Let's focus on quality interactions, not just with the provider, but with the entire office using sort of an account selling mindset. So in quarter 4, we had quality calls and we increased our call effectiveness by 20% more calls per day. And in quarter 1, we've continued that quality interaction mantra on. We've got 8% more calls. We're averaging 8-plus calls per day, again, quality interactions in our staffed territories with our most important providers across the United States. We brought in a third-party vendor, and I talked about an account selling mindset. You cannot win in the U.S. marketplace if you're going to wander around and just try to see the provider. You have to impact every single solitary person in that office and follow that prescription all the way until it gets into that patient's hands. If you do that, you'll be a successful sales rep. That's what we've trained our sales team to do. Additionally, like I said, I have a top flex regional sales manager team, but we've also trained them with additional business acumen. And we've also trained them to be the best coach possible for their sales representative to make them the best business people they possibly can be. And from an execution standpoint, it's really important we focus on peer-to-peer learnings. My team is focused on executing speaker programs this first half of the year and have done an outstanding job doing that. Next slide, please, Laura. I talked about execution. I want to talk about pillars now. I've had 2 pillars in 27 years of leadership. They've never changed, and they're undefeated. They've always been successful. I focus on development, I focus on execution. Now let me break that down just a little bit for you. When I talk about development, I talk about representative develop. I talk about making them a real -- an important employee in our organization, someone wants to grow and become the best person they can be in our organization. We will help them to do that. We also want to make them if they want to develop in a career, they want to become a regional sales manager or get into training. It's our job to take the best and the brightest and cultivate that over time. So we develop them that makes them long-standing employees in our organization, makes them happy employees and makes them more effective employees in the field when they're interacting with our customers. And then I mentioned it earlier, execution. It's our job each and every day to execute the strategy that Chad and his team puts forth to us because from my standpoint, flawless execution is the strategy for us in the field. Thank you very much for your time, and I'm going to turn it back over to Chad, so we can finish up our presentation.

Thank you, Tony. Look, from a marketing perspective, understanding our providers and customers is critical to supporting the Tony's field force effectively. Over the last 6 to 8 months, we really have focused on measurement and market research. That really has been our core tenet. And we do this to ensure that we're developing and providing the right tools that Tony and his team need to succeed. So a couple of key call-outs here. We work in a very promotionally sensitive space. I want to underscore that. We work in a very promotionally sensitive space. You make the calls, you usually see the results, right? So what we have to do is ensure that Tony and his team have the tools. The most important tool that we have are samples. As a matter of fact, as it sits today, Mayne Pharma in our product, Nextstellis is 1 of only 5 sampled products in the U.S. market. If you look at oral contraceptives, we're only 1 of 4. So that is important that we're allocating those samples accordingly. Another key area is providing air cover for Tony's team. So we have optimized our paid search programs and our other digital assets, and we'll talk a little bit more about that in just a second. And we've maintained national conference visibility, ensuring that we can interact with the very top providers in the United States to get our message out so they can ultimately share that with their peers. Next slide. So to that end, how are we communicating that message? So Tony touched on our speaker programs. We have developed a world-class speaker bureau. And what I mean by that is that we have pulled 25 of the top key opinion leaders in the United States in the hormonal space. And what they do is they go out and they are able to present a branded deck around our products and our brands. So as of today, we've reached 1,500-plus HCPs, and we're doing that through a dedicated Nextstellis deck, a combination Annovera and Nextstellis deck. In the last week, we actually have had an Annovera stand-alone deck approved, and we are certainly on the cusp of having a Bijuva deck. We're certainly getting a ton of interest from our key opinion leaders telling us that the market absolutely is hungry to learn more about the menopause space. Next slide. So we talked a little bit earlier about leveraging our digital resource to support Tony's team. And again, our core tenet is measurement and ensuring that we're getting the best ROI. So over the last 6 months, what we've done is we've done a bit of an analysis on the things that were in place. And basically, we have gone back and had a chance to optimize. So to ensure this optimization, we took a look at our consumer side of the business and realized that, hey, we might want to dial a little bit of the consumer activity back for now, but let's increase some of the activities we've got on the HCP side. And by optimizing those ROIs, we're able to provide the type of information and air cover for Tony's teams so that when they go into an office, they're meeting a clinician who's absolutely ready to have a more detailed discussion. Next slide. So patient access is an absolute priority at Mayne Pharma. There are 3 key pillars to this access story. One is the relationship and the negotiations that we've done with the insurers and the payers. The second is the offering that Mayne Pharma provides from co-payment. And the last is the channel strategy or channel play. So if we look at the coverage and access from the insurer payer side, we've negotiated with the payers that make the most sense to our business today, and we have about 70% access. That means 70% of our patients can access our product if they have insurance coverage, and that is absolutely on par with our key competitors. For those patients that don't have access or those patients, the 70% that do, we also provide a co-pay card. For the 70% that have access, we are able to buy that patient down to a $0 out-of-pocket cost. For that 30% that doesn't have any contraceptive coverage, we're offering them a chance to get our brands at $25. This is truly a best-in-class offering. And taking the next step to our channel play, we segment this into 2 key segments, right? We look at the wholesaler side, which is about 60% of the business and the nonwholesaler side, which is about 40% of the business. On the wholesaler side, you've got the big chain pharmacies, right, that really drive a lot of the conversation and the narrative when it comes to the payer space. Our focus and Tony's team are having business conversations to try to drive as much business as possible into our independent pharmacy network or the part that sits in that non-wholesaler side. And what that does, it allows us to have white glove service. It certainly allows for the patient to have the very best experience. Next slide. So even with this best-in-class offering, when it comes to cost, that continues to be our #1 obstacle or the #1 piece of feedback that we get from both our providers as well as our patients. So many of you may have heard about the new proposed rule change to the Affordable Care Act. Let me be very clear about this. The Affordable Care Act, the contraceptive mandate portion of that has been in place since 2012. Unfortunately, the way the language was originally written, it has allowed or afforded the payers to not necessarily adhere to the rule the way it was intended or the way it was originally written. So on October 21, just last week, there was a proposed change rule. And essentially, what this does is they added key language around the therapeutics equivalent. So the intent is that there will be no cost sharing for any contraceptive that does not have an Orange Book listed therapeutic equivalent. So again, for us, what that means is that both Nextstellis and Annovera do not have therapeutic equivalents listed in the FDA's Orange Book. So again, we are very hopeful in what this may ultimately mean, but time will tell. So at this point, next slide.

Well, thanks, Chad, and thanks, Tony. Appreciate that, and they look forward to answering your questions in the Q&A period following Meredith and Daniel Moore's presentation here on how we're winning in Dermatology. So over to you, Meredith. Thank you very much.

Great. Thank you, Shawn. I'm excited to walk through our Dermatology strategy, a focused plan to drive growth, innovate and expand access to quality care in Dermatology. Our goal is to enhance patient experiences and support health care professionals with needed solutions. Now let's dive into how our strategy is transforming Dermatology. Next slide. Since 2021, we've been steadfast in our mission to transform care and deliver predictable outcomes. We've had a clear focus on elevating our Dermatology division as a leader in innovative solutions. Our aim is simple, yet powerful, improve patient experiences and expand access to specialty therapies. Next slide. So in order to achieve this vision, let's explore key differentiators, essential factors that strengthen our position in Dermatology. I'll highlight each of these further in the next few slides. But first, more than half of the sales force has been with Mayne Pharma for over 3 years. This embodies a unified vision and commitment to our mission. This is all supported by experienced leadership with a proven track record. We have strategically transformed our portfolio over the past 3 years to align with market shifts. So with over 9 years in dermatology, we have absolutely established ourselves as trusted partners in the field. Next slide. Our tenured sales force is central to our success whose impact and expertise harness passion and commitment in Dermatology. Our dedicated professionals have fostered trust-based relationships through their extensive field experience. We prioritize ongoing training focused on sales processes and market trends to ensure our team remains at the forefront of the industry. This collaborative spirit encourages knowledge sharing and drives our collective success focused on a patient-centric approach. So our sales force is fully focused on improving outcomes and experiences for HCPs and their patients. Next slide. With a focused and concentrated coverage strategy across key areas, we're maximizing our impact in the market. Our dedicated efforts span 41 territories and 4 regions, allowing us to effectively serve our health care professionals and patients, ensuring that our access solutions reach those who need them the most. Next slide. As we continue to expand our coverage, our Dermatology portfolio transformation continues to expand across key Dermatology markets. At the start of our portfolio shift, we saw 100% unit growth in those first 3 years, resulting in about 200,000 units shipped in 2021. As we furthered our portfolio approach, we saw an impressive growth of over 450% from 2021 to 2024. We're on track to ship over 1 million units in the 2024 calendar year. So in total, our portfolio growth strategy with our field force carrying over 20 products has achieved a 900% growth in units during this time period, and this is only the beginning. This growth underscores our commitment to delivering effective solutions to meet patient needs. Next slide. Building on our portfolio transformation, we are proud of our diverse product portfolio and pipeline [technical difficulty] that supports our commitment to Dermatology. Our growing range of Dermatology products includes comprehensive options from acne management such as DORYX MPC and FABIOR in the realm of psoriasis, LEXETTE and WYNZORA. Additionally, for rosacea, our newest addition, RHOFADE. As mentioned, our sales force promotes a product portfolio menu of over 20 products today, which allows us to go into our practices as a valuable partner in dermatology. With ongoing investment in our pipeline, we are dedicated to expanding our offerings to meet emerging patient needs. Now I'd like to hand it over to Daniel Moore, who will take us through our channel strategy. Thank you.

Thank you, Meredith. I appreciate you highlighting our products and our portfolio growth as well as the impact our people have on our business on an everyday basis. As Meredith has mentioned, my focus here is going to be talking about our channel strategy, which is really a twofold process. One would be the traditional specialty pharmacy network that we've talked about a number of times over the years. It's really the beginning of disintermediation. And then what we referred to more recently is full disintermediation is what we're really excited about going on in FY '24 and beyond. To begin, our channel strategy is really about putting our products in the hands of patients in the most efficient manner. And I know the U.S. health care system can be difficult to digest and understand. But to compare it to the Australian market, effectively, we're trying to provide non-PBS listed drugs at a PBS out-of-pocket cost for our patients. This simplicity has led to our success so far, and we look forward to building on that going forward with our full disintermediation strategy. Next slide. So the overall market trends that are occurring in dermatology are leading to Mayne's favor and gives us a right to win. I mean if you look at the expanding population in the United States, it's driving more and more visits to specialists, including dermatology. And for our portfolio, which largely treats mild to moderate common conditions, there are no cures. And so we have an opportunity to really step in and provide that predictable out-of-pocket cost, predictable treatment protocol so that patients can get the drugs their prescribers want them to have to alleviate their conditions. As a result of the payer activity in this space, big pharma has largely left medical dermatology, especially the small molecule dermatology, which has given us an opportunity to build quite a portfolio over the last 6 years via capital-light transactions, and we continue to explore additional opportunities to add to our portfolio. And lastly, it's really about disintermediation, which is breaking down a very complex health care system in the United States and creating a simple path to market for patients of all types to acquire our products at a predictable out-of-pocket cost. In the specialty pharmacy channel that we deal with, we have 400 direct customers that we ship product to on a daily basis, and we're dealing directly with them versus working through wholesalers or other distributors, which allows us to generate cost savings on the sales process that we can then in turn utilize to offset patient out-of-pocket costs as coverage of our products has declined over time due to benefit design changes and formulary management by the big payers in the United States. Next slide, please. But our future outlook is bright because we plan to expand on the spec pharmacy network by utilizing GoodRx prescription services. This is a seamless transition for patients to get a coverage decision inside of 30 seconds to understand if their insurance benefits are going to pay for the product or not. If it is covered, they will be transferred to a local specialty pharmacy or another one of our national partners. Amazon is one of those, and they'll get the best out-of-pocket cost utilizing their insurance. And fortunately, if the prescription is not covered by their insurance, they will have the option to pay a predictable affordable cash price through our wholly owned pharmacy, Adelaide Apothecary. This is game-changing in our opinion and in the eyes of our prescribers who really just want simplicity at the point of care so that their patients can understand what they're going to be expected to pay for the treatment that they want to put them on. Shawn, back over to you.

Well, thanks, Daniel. And as you can see, we have passionate leaders with Tony, Chad, Meredith and Daniel, driving commercial excellence and operational excellence every day with a focus on our patients and our providers. So I'm going to turn it over to Tom to manage our Q&A period here, and we look forward to your questions. Tom?

Great. Thank you, Shawn. And we have a lot of questions here today, which is very pleasing. So I will kick off with a couple of questions for Women's Health and then a couple of questions for Dermatology. The questioner has asked, we noted the recent proposed rule last week from the U.S. government for significantly increased coverage of contraception for women of reproductive age with private health insurance under the Affordable Care Act with an implementation date of 1 January 2026 proposed. What is Mayne doing to prepare for the upcoming proposed enforcement of the ACA? And based on your coverage and access slide, how will this potentially improve sales?

So I'll just highlight a few things and turn it over to Chad. But we've been active in working with the government and working with various lobbyists to ensure that access to affordable health care, especially with the contraception, is being adequately addressed by the government. So we're pleased with this recent announcement. And the January 2026 implementation is probably the least or the most farthest day out, and we could see some more implementation of this proposal earlier than that. But Chad, do you want to talk about the specific things that you and Tony are doing to educate the market and ensure that we can be successful in driving higher volume and improved margin with our products as a result of the ACA change.

Yes. Thanks, Shawn, for that. Look, I think there's a couple of key things that have been at play at Mayne Pharma for quite some time. So the first is preparing to educate our field force around what this change potentially could mean and ultimately educate our providers as well as consumers as to what their rights are going forward. So we've got a number of things that are in play with that. One of the things that I shared with our internal team about a week ago was that we're probably going to end up seeing a, what I call a pre-2012 marketplace. If you look at the marketplace today, we're about 90% generic and about 10% brand. So not saying that it's going to flip immediately, but what you will see is you'll see a lot more activity around in-office conversations with physicians to try to garner as much of that branded share as possible. So there'll be a lot more activity on the branded side. And the good news is, as Tony shared with you, we have a best-in-class sales and leadership team to help us execute there.

Tony, do you have anything further to add on that?

Yes. I just want to say it's critically important, and Chad mentioned it, that my team is educated to reactively respond to a provider that will ask a question because they will ask us questions about this. So we want to be the expert for them. But my team has to understand that right now, that terrain is not fully changed, and we have to conduct business as business is being conducted, which is today, drive business in the current market conditions, the best way possible. So when this does come into effect, we built the momentum needed to capitalize on and maximize it for full profitability at that point in time.

Thanks, Tony. Tom?

Thanks, Tony. The second question pertaining to Women's Health is what is your take on the menopausal market given all the recent media attention it's been receiving? And how do your current brands meet the needs of that market?

Yes. So I think the recent media attention that the hormone space or the menopausal space is receiving has been incredibly positive. Look, there has absolutely been a void or a gap since the women's health initiative, and that was the big study that really put a black spot on hormones in general. So to see the conversation coming back in the other direction, certainly gives us a lot of hope and a lot of promise. But what really excites us is the fact that our unique brands that have an incredibly unique offering affords us the opportunity to have very meaningful conversations with our physicians. So when it comes to Bijuva, this is the only bioidentical estradiol and micronized progesterone product that's on the market, the only product that combines these 2 molecules into one. And it absolutely solves for one of the biggest concerns that providers have, and that's protecting an intact uterus from estrogen. And then when it comes to local estrogen, certainly, IMVEXXY with the 4-microgram dose and the 10-microgram dose is incredibly well received. And so again, high tides lift all boats. So we're really excited about the news, and our intent is to continue to capitalize on that.

Thanks, Chad. Appreciate that. This is a couple of questions now for the Dermatology team. Dermatology is a highly competitive market. I think we've called that out. What differentiates Mayne Pharma from its competitors? And how is the company positioned to continue to capture market share?

So I would say in Dermatology, access to our dermatology products is paramount. So between our portfolio approach and our patient access programs, we have the strategic positioning that truly enables us to continue capturing market share effectively through both of those approaches. And that's what drives the difference that we make. And as Daniel shared earlier, and as you look at the small molecule space, there are fewer and fewer companies operating in what we have truly taken ownership of and being looked at as the dermatology company by our providers, by patients who are helping serve and provide products in their hands each day.

Thanks, Meredith. There's another question here that pertains to patient access. So patient access to dermatology treatments has been a core focus of mine. Can you elaborate on the initiatives the company is driving to ensure more patients have access to the care they need. And why is this important? And as a second part to that question was that it looks based on the territory maps that there's an opportunity for the Dermatology team to expand its geographies in the United States. Just some comment there as to whether there's some expansion moving forward.

Yes. I'll take that question, Tom. Patient access is core to what we do. From our perspective, if our patients can't get their hands on our product because they're not affordable, we're failing in our mission, which is ultimately to provide treatments that are meaningful and life-changing to them at an affordable out-of-pocket cost. So we focus a tremendous amount of effort and attention on ensuring that access is simple and affordable. From a personal perspective, I've had a number of issues, thankfully minor dermatological conditions that impacted myself and my family and have been met with friction through the process through dealing with traditional retail pharmacy. And in the United States, I don't believe that should be the case. And so what we've designed here is a path to market that reduces the out-of-pocket cost for patients while generating profit for Mayne Pharma. And obviously, you're seeing the growth there throughout the time frame that Meredith has presented earlier. And as it relates to expansion, we've certainly identified a number of targeted regions where we would like to go. The reason you see the West Coast in that map is a bit of a white space for us is because that is where payers that were heavily focused in that area really started changing formulary design and ultimately not covering our products, and it wasn't viable under the old kind of traditional retail pharmacy model where you're really banking on coverage to maintain profitability. But as we continue to scale the business, there are opportunities to expand and ultimately expand our profitability and access that patients can find throughout the United States.

I might just ask that same question for Tony and Chad as it pertains to Women's Health, a question I had asked for expansionary initiatives or otherwise for the Women's Health team across the continental United States.

I'm sorry, Tom, was that a reference to expansion of the sales force or...

Correct. Yes, to meet those sort of white space territories that are on the map that was presented.

Yes. I think the number of representatives that we currently have for the product mix that we currently have, I think is a great number of sales reps who capitalize on the opportunity with our product mix and maximize profits for our organization. Now there's not a sales leader in the world who wouldn't say, yes, give me a few more sales reps will drive some more revenue. But we have to be very careful about how we do that and work in the marketplace. I think as we move towards the Affordable Care Act enacting and we see growth in varying parts of the country, that's when we're the right-sized company to do that, we can very quickly add a handful of reps in any general area to make that move. If we decided to do that was the right thing at that point in time. But right now, in a snapshot in time, I think the number of reps we have is perfectly optimized for the business potential we're looking to drive.

Great. Thanks, Tony. This is a question for both teams. We are moving at pace, which is good. There are a lot of questions pending as well. And Shawn, I'd loop you into this as required. So for both teams, please provide color as to women's health and dermatology pharma sector U.S. sales growth more broadly. Is it in line with or above population growth? And is it being driven by increased customer spend in these 2 respective areas? If you could give us some flavor as to the dynamics for those markets, that would be helpful.

Absolutely. I think, Tom, to start with Women's Health, it's bifurcated between contraception and menopause. So contraception growth is really a function of population growth and women of treatment age. I certainly think the reversal of Rove versus Wade in this country has also expedited that conversation in a number of households. On menopause, it's really a shift in terms of the view of hormone replacement therapy in light of really the outcomes of the WHI from 20-plus years ago. So you are seeing more and more women seeking treatment. And there are some other nonhormonal treatments as an example, promoting in the market, driving a lot of noise that's helping kind of us ride the wave. From a dermatology perspective, it's really about population growth, and it's about us expanding the portfolio that we have to reach more patients. And it's more about us being more present in prescribers' offices with the offer that we have. We do see certainly mild to moderate skin conditions continuing to grow and expand, but it's more of a function of population growth than those -- a higher percentage of the population seeking treatment.

So in summary, what you're seeing from a volume standpoint, there is the volume increase of use of dermatology and women's health products is growing faster than the population growth. And then the value is driven by how much of the mix is generic versus branded in those 2 segments. But the good point is in both segments, Mayne Pharma is growing faster than the market for both dermatology and women's health dramatically.

That's a good point, Shawn. And it's a good lead into a question we had, which is the assumption that you're growing faster because you're winning market share. But if you win market share or we win market share, is the company noticing the competitors are beginning or have increased the amount of discounting in those markets where we're competing. And just the second part to that would be as it relates to the sales force for both segments, what are our strengths and what are our weaknesses to respond to that from the perspective of the sales forces?

Sure. I can touch on the pricing point, and then I'll turn it over to Tony and Meredith to talk about the strengths of the respective sales forces. We're not really seeing discounting in the marketplace in face of our competition. We certainly do see competition in our face. As Chad mentioned, there are 4 other competitors sampling oral contraceptive products. They're not doing that out of the goodness of their heart, right? They're trying to win business as well. So it is a competitive landscape. And similarly, in dermatology, while big pharma has walked away, there's still a number of competitors in the oral and topical space that are trying to build their business as well. Thankfully, we have world-class products that do make a difference in our patients' lives and obviously, a world-class access program. But the biggest thing is our teams that are out there every day, and I'll turn it over to Tony and Meredith to talk about the strengths of both organizations.

Yes. Thank you, Daniel. I'll now turn it over to Meredith. In the U.S. marketplace, every day in the pharmaceutical space, I don't care what you're selling, is a rock fight. You have to win in that office against your competition. That's what it's all about. And if you're -- I always say if you're talking price, you're leading with your chin. You have to be able to outsell them clinically, make it a clinical choice for the provider to provide the best product for that patient because the vast majority of the patients out there can get our products for 0 or no more than $25. And there's no reason why a patient wouldn't be able to get our product if the physician believed it was a clinical choice for that patient. We have trained our reps to be account salespeople. So when the prescriber says I want to do it, the MA helps that patient get that product. When the place calls back and says there's a PA, you need to do a prior authorization to get that product, they work with the patient to do it. That's what an account sales team does. That's what Meredith and I invested in with both of our sales teams to do. And that's why we're going to see success, and we have seen success in the last 12 months and moving forward. And let me turn it over to Meredith to put more color on that, please.

What I would add is really when you look at the sales force and for me with our Dermatology group that we have the tenure. And we have really come together in these initiatives by the common mission and vision to truly impact change in Dermatology, to truly impact the patient experience in that access and approach. And so from a sales force perspective, we are all in line and lined up in our offices to support the access strategy that we've implemented. We have changed the space dramatically with our ability to offer patients access to medications that due to the complications within the health care system in the U.S. provides great challenges for patients to access patients that the physician wants them on. And so as Daniel mentioned as well, we have world-class products. And so our ability to continue to build out our portfolio, put it in the hands of our sales force that is highly trained and their background in dermatology, we are a trusted resource in our offices, and that's the benefit of what we bring and also what we're building in dermatology as it relates to our access model.

And Tom, I'd just like to add one thing to that. Because many investors here are used to Mayne Pharma being a generic company of the past. And that pricing challenge or responsiveness is something that does happen in the generic market in that when we're player #5, 6, 7, 8 or even #3 in a generic market, the only way we're going to create market for that brand, that particular generic is the price opportunity that will allow us to get on the formulary, allow us to get the access and create that volume. In the case of a branded pharmaceutical, it comes down to patient access. Is the out-of-pocket expense perceived to be okay relative to the clinical benefit they're going to get out of the product? And in that scenario, you do not see price strategies between the companies. You see more value, clinical value, as Tony highlighted, in driving the experience. And it's our responsibility, as Chad highlighted, to ensure that all the patient programs make a level playing field for the out-of-pocket for the patient. So that's the driver there.

I think that's a good lead into a question we've also received here. So we've talked about the sales force across both derm and women's health, and we've talked about our footprint, our white space and our opportunities. The question now is, well, clearly, a sales rep has a kit bag and in that kit bag is a group of products. And the questioner said, we have appears to be a robust portfolio of products for both Women's Health and Dermatology. And the question was asked, are there any specific opportunities that Mayne Pharma sees to add products to address other unmet or underserved therapeutic areas?

So let me start that and then Daniel or Chad or Tony or Meredith can jump in. But we continuously look and we work with our Dermatology customers to what are the products that they need. One of the things I've tried to tell the market is dermatologists in the United States went into practice because they never wanted to be on call. Unfortunately, the payers, the insurance companies put dermatologists on call by preventing their prescriptions to be filled the way they wrote them, preventing the actual product that they wrote to be used for that particular patient's condition. And so we've been working with our customers. So we have 22 generics and authorized generics and 6 brands that offer solutions in acne and psoriasis and atopic dermatitis, et cetera. There are other products that our customers are asking us to bring to the market and put through our channel and allow the patients to get the proper access to the proper medications. And we will continue to do that. We will continue to add products into our channel for dermatology. In Women's Health, right now, the team, Tony and Chad and the entire Women's Health team have a full mandate. We have 4 products that are in the era of educating the market on their benefits relative to the competition and how that's going to meet the needs of their patients. They're early in their onset, and we have lots of headroom to drive significant growth for all 4 brands, Annovera, Nextstellis, Bijuva and Imvexxy. So we're remaining focused in Women's Health, but our overall strategy for any product acquisition, whether it's through a license, through a co-promotion, or through a profit share is to bring in products that are valuable to our customers and also add to our bottom line. We're focused on bringing accretive products into the business.

Thank you, Shawn. That's great. I have a question for Daniel as it relates to Adelaide Apothecary. So can you explain why Adelaide Apothecary is required for the disintermediation strategy if you can potentially utilize specialist pharmacists as well? And can Mayne sell women's health products using the same channel approach as we have for Dermatology?

Yes, absolutely. So I'll handle the first part of that question, Tom. And really, what Adelaide provides to us is a more efficient path to market. Our specialty pharmacies are great partners and have obviously helped us along this journey. But the reality is, at some level, there's profit leakage even through that channel. So Adelaide allows us to build direct relationships with patients and prescribers. And ultimately, it's more efficient, i.e., it drives a higher return for us at the same price to the patient. And really, Adelaide is a piece of our go-to-market strategy that's really GoodRx Prescription Services. And the real benefit of GoodRx Prescription Services is the patient gets the full utilization of their health care benefits upfront. So through AssistRx, you're getting a check across a wide range of pharmacies that can fulfill your product to understand what your coverage could look like. And we're putting you in the best possible coverage outcome across that wide-ranging pharmacy network. If you are not covered at all, then you will be triaged to Adelaide Apothecary fulfillment at a reasonable cash price. As it relates to the Women's Health part of the business, we do have a tremendous amount of volume going through both our channel strategy as well as through Adelaide Apothecary. As Chad highlighted earlier, 42% of our business is on a direct basis in Women's Health. And through a transition from vitaCare Prescription Services who was one of our partners previously, they unfortunately went out of business. We were able to move over 7,000 patients for Bijuva and Imvexxy directly into Adelaide Apothecary, and we've retained 95% of that business. So it's really -- it is meaningful for the Women's Health business. We didn't necessarily build that organically, but it is a way for us to, again, drive value for them, for our patients, in terms of providing a predictable out-of-pocket cost consistently through Adelaide Apothecary.

Right. Thank you, Daniel. I'll attempt to bundle a couple of questions that we've received for Nextstellis particularly in Women's Health. So just bear with me here. But the question for Nextstellis, what is the unique selling proposition for an obstetrician gynecologist to refer a patient to this product? And once they commence on Nextstellis, how common is it to switch to an alternate contraceptive? And what is the mix between branded and generic contraceptives in the U.S.? And does this mean Nextstellis and Annovera are now on a level playing field with others if that proposed rule is made final in 2026?

Chad, do you want to...

Yes, I'm happy to take that question. So let me work in reverse order, if that's okay. So to touch on what I shared when I was walking us through the Affordable Care Act, the current contraceptive mix in the United States is about 90% generic products and about 10% branded business. Now in a dollarized number, it's about a 50-50 whenever you're looking at the total dollars that are segmented. So what is the unique selling proposition for a product like Nextstellis? Well, you have to win with new start patients, right? That is a core tenet of any contraceptive product. You have to win with the new start patient. If a patient is doing well, even if they're doing well on an antiquated or much older product, and we've got the greatest product ever, that patient and that obstetrician in the United States gynecologists, they're not going to switch that patient. So first of all, we have to ensure that our core messaging around having a fantastic progestin with drospirenone that has antiandrogenic and antimineralocorticoid activity, that's less whiskers and zits for the young patients and talk about the selectivity of the estrogen component, E4. This is the first time we've had a truly selective estrogen in a contraceptive product with less impact at the liver, potentially less impact at the breast. So we've got to communicate that message to our obstetricians, gynecologists from the very beginning and ask for those new start patients. And Tony's team over the last several months have clearly demonstrated that they're doing that. So when it comes to switching, in general, in the United States, a patient will switch on average about 3x to find that right product. Our hope is we can get to -- Tony and his team can get to them very early and Nextstellis will be one of the first choices. And hopefully, they'll have a great experience because when they do, they tend -- the lifetime value of that patient tends to be pretty significant.

And Tom, I just want to highlight, when we first launched the product, we went after low-low users on the profile that this product had less bleeding profile. And we ended up getting patients who had bleeding issues that may not have been a result of low, but a result of their physiological condition having endometriosis or fibroids. Many of those switches didn't result in a long-term adherence for the product. And so they would switch off -- when we changed our strategy to focus on the entire selectivity, E4, everyone on this call has had E4 in their body when they're a fetus. This is a natural estrogen, has unique selectivity and unique properties on impact on cholesterol, weight gain and breast tenderness that you heard and how the bleeding profile itself is actually unique as well. So that -- once patients -- if you oversell or overpromise, that's why you get a switch. And we've changed the strategy on the communication on the product. We're seeing what we -- a good way to check the switching is how many repeat scripts do you get out of that initial new Rx. And that has changed dramatically when we changed our strategy to communicate the benefits of the entire selectivity. So it is there is an opportunity in the marketplace that didn't exist before because one of the products we go up against and it's well recognized in the market in Australia and in the United States is Yaz. And Yaz has the same progesterone as Nextstellis. But for the first time, customers, if they had patients that were experiencing breast tenderness or higher cholesterol levels, they now have an option to switch. So as Chad says, if there's -- if it's not broken, they're not going to fix it, right? But now they have an opportunity to explore with their patients, are they having issues with cholesterol? Are they having breast tenderness because they have an option to switch them with a better solution for that patient profile.