Good morning, ladies and gentlemen. Thank you for joining us for the TherapeuticsMD Third Quarter 2020 Financial Results Conference Call. [Operator Instructions] I would now like to turn the call over to TherapeuticsMD's Vice President of Investor Relations, Nichol Ochsner. Nichol, please go ahead.

Good morning, everyone. Thank you for joining today to discuss our third quarter financial results and business update. This morning, TherapeuticsMD issued a press release, announcing our third quarter financial results. The press release is available on the company's website, therapeuticsmd.com, in the Investors & Media section. On today's call from TherapeuticsMD are Chief Executive Officer, Robert Finizio; Chief Financial Officer, James D’Arecca; and Chief Commercial Officer, Dawn Halkuff. I would like to remind everyone that certain statements made during this conference call may contain forward-looking statements. Such statements – such forward-looking statements are based upon current expectations, and there can be no assurances that the results contemplated in these statements will be realized. Actual results may differ materially from such statements due to a number of factors and risks, some of which are identified in our press release and our annual, quarterly and other reports filed with the SEC. These forward-looking statements are based on information available to TherapeuticsMD today, and the company assumes no obligation to update statements as circumstances change. An audio recording and webcast replay for today's conference call will also be available online in the Investors & Media section of the company's website. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded November 9, 2020. With that, I'll turn the call over to TherapeuticsMD CEO, Rob Finizio.

Good morning and thank you for joining today's call. On today's call, we will review our third quarter performance, our future commercial plans, as well as progress made on strengthening our capital structure. Presenting on the call will be James D’Arecca, our Chief Financial Officer; and Dawn Halkuff, our Chief Commercial Officer. Let's turn to Slide 4. We delivered a strong third quarter of operational execution across our product portfolio that resulted in growth in prescriptions, improvement in net revenue per unit and an increased total product net revenue. Even in the face of challenges presented by COVID, we achieved $19.3 million in total net revenue in the third quarter, an increase of 80% over the second quarter. ANNOVERA had approximately 115% increase in total prescriptions dispensed over the second quarter. In addition, our menopausal products achieve double-digit growth in both new and total prescriptions in the third quarter over the previous quarter. We also realized the results of swift actions we took to reduce our operating expense in cash burn. Turning to our intellectual property; we continue to fortify ANNOVERA’s patent portfolio to provide lasting durability for our flagship product. We recently added two additional patents to the Orange Book for a total of three listed patents for ANNOVERA. This provides patent exclusivity through 2039. For the menopausal portfolio, we recently added one new patent for IMVEXXY and one new patent provide for BIJUVA, both Orange Book listable, expiring in 2033 and 2032, respectively. I will now turn the call over to James D’Arecca to review the financial performance in more detail. James? James D’Arecca: Thanks, Rob. Let's move to a review of our financial results and key metrics from the third quarter. Turning to Slide 6, our overall net revenue for the third quarter increased to $19.3 million,…

Thanks, James. I will start with a quick overview of payer status and then review the momentum seen across our product portfolio in this quarter. Let's start with payer access and updates on Slide 10. We have maintained all major payers across the product portfolio and continue to make progress. Starting with ANNOVERA, Caremark added ANNOVERA at non-preferred status in August. We also made progress with Medicaid. West Virginia Medicaid has made ANNOVERA unrestricted as of October 9, and Medi-Cal added ANNOVERA as of November 1 for fee-for-service. We had an additional win with Anthem, who has moved BIJUVA from non-preferred to preferred as of October 1. BIJUVA insurance coverage is 71% for commercial. Let's move to Slide 11. Now that we have strong payer coverage for ANNOVERA, let's look at how the strong access combined with favorable state laws for birth control are supporting low out of pocket costs for our flagship product ANNOVERA. First, when looking at a cross-section of top commercial payers, the cost for ANNOVERA is the same or less than the generic for NuvaRing on an annual basis. In addition, our data is showing that 80% of patients pay zero out of pocket and 17% paid between $1 and $60 for the annual protection of ANNOVERA. We know this from the 1,800 patients that have utilized our patient care and data hub vitaCare. We believe the patient out of pocket data is representative of all patients, regardless of where they fill. Let's move to Slide 12. I am also pleased to announce that we have gained preferred coverage for ANNOVERA with one of the top pharmaceutical benefit managers that will begin in January. The reason this is significant is that approximately 20% of commercial lives are managed by this payer. ANNOVERA will be the preferred…

Thanks Dawn, let's move to Slide 29. We're very proud of the hard work and results our team delivered in Q3. Record growth, reduced operating expenses, improved payer coverage and reduced net loss by $19.3 million. Looking ahead, assuming COVID-19 does not disrupt our active access to providers offices. We are currently on track to meet our $20 million Q4 revenue covenant, taking significant steps towards our goal of EBITDA breakeven for Q4[ph] of 2021. Although it will not address all our capital needs and we may need additional funding, we believe we have found a potentially significant source of non-dilutive capital through the carve-out of vitaCare, the simplicity and transparency that vitaCare delivers can truly revolutionize prescription fulfillment and we will be excited to watch that process unfold. In addition, one of the largest PBMs representing over 20% of the market or approximately 20% of the market will be excluding IMVEXXY and ANNOVERA’s competitors from their formularies and providing a new opportunity to gain market share on January 1. Thank you all for joining the call today. And we'll now open the call for questions.

[Operator Instructions] Your first question comes from Annabel Samimy from Stifel. Your line is open.

Good morning, everyone. This is Nick Rubino on for Annabel. Congrats on the progress this quarter, and thanks for taking our questions. First, can you please help us frame what might happen if you missed any of the upcoming revenue requirements? Would the remaining $50 million debt tranche come off the table or would there be a different type of change in your relationship with TSSP? And then secondly, based on your IMVEXXY and ANNOVERA commercial campaign launches over the summer, how should we think about your upcoming inflections of the products? And then with the reduced cash requirement to $45 million, should we expect that you'll be utilizing that cash to invest further in those campaigns? Thank you.

Hey, Nick, this is Rob Finizio. And I'll go back and forth with James D’Arecca, our CFO here. We're clearly on track for Q4 to hit our minimum revenue covenant. So we're not concerned around that at all. So we feel pretty good there. Our goal is to get EBITDA breakeven in Q4 of next year, right? So I think when you see our reduced minimum cash on hand by our lender, that's a very cooperative statement by Sixth Street to give us a runway to get this non-dilutive options completed. Although, I don't think that will be all the money we need to get to profitability. It takes a massive chunk off the table, right? So I think it's – what you're seeing is a very cooperative lender, a great, great result by our new CFO and a lot of the things our previous CFO did to get our operating expenses down and the revenue way up. So I feel good that we're on track, we're on target, and we're going to hit our goals and things look really good, right? So the real wild card here is if COVID brings in another shutdown, and delays things, and then we're going to have to cross that bridge and could need a little bit more money, but other than that, I think we're in great shape. Did I address all your questions?

Yes. I guess just in terms of like with COVID and any given thing happening in terms of volume fluctuations through the next year, I guess we're just on a level of like catastrophic to not really an issue at all. Just what the possibility would look like? Is it just the renegotiation that you would be looking at with your partner? It obviously seems like they're definitely cooperative.

Probably. Yes, they're a great lender, probably. I mean, look, we're doing better. If you track the 12 launches out since COVID’s hit, we're doing as good as any of them, right? So it's realistic, a lot net margins, our nets are incredibly strong, our volumes incredibly strong. We have a great escalation starting on January 1 with one of the largest PBMs in the country. We're not so concerned that our lender, if you missed by dollar would go crazy, I think that's what you're asking. I think they're very reasonable. They are lenders though, with that being said, and I think we're in great shape and I think we'll deliver. And we don't believe if you missed it to your point our revenue covenant because there was a COVID shutdown. They would come in and try to grab the company. They're just not in that business. But then again, they are a lender and they have all their rights.

Great. Yes, that's perfect. Thank you.

Yes. They’re – I'll tell you, and not to start a plug for Sixth Street, they are very, very reasonable, very accommodating, and you've seen how they've worked with us so far. We highly would recommend them, highly.

Your next question comes from Louise Chen from Cantor Fitzgerald. Your line is open.

All right. Good morning, everyone. This is Carvey in for Louise today. Just a couple of questions here. While we’re seeing ANNOVERA, BIJUVA, IMVEXXY, they target different age groups. So how much surgery is there between these products to your sales force and marketing channels? Secondly, I have a second question here. What is the optimal gross to net target for ANNOVERA? And what is strategy on getting to that level? Thank you so much.

You got it. Thank you. So I'll take a little bit, and I'll hand it off to Dawn, our Chief Commercial Officer. So you're right. So what basically you have here are obese that are young in their career, and they're delivering a lot of babies and doing a ton of contraception. And then as they get older in their career, they usually lean towards their GYN side. So they don't have to wake up in all hours of the night. They don't have the liability for delivering babies. But the beauty of what we're doing is they're all in the same office, right? The 20,000 OB-GYN targets that we have for ANNOVERA, which are over 60% of the prescriptions, we can reach with our current sales force, right? We don't need any additional people to get to them. And that – this is the largest prescription category in women's health, I believe over $6 billion a year in sales. So to answer your question, there's a lot of scale of efficiency. And we are at the right number to get to those top 20,000 targets from a headcount standpoint on our side. So we don't see any growth needed on sales force with the current product portfolio that we have. From a gross to net standpoint, I'm glad you asked. That's a good one. So we feel very good of what we put out going forward into 2021 that we would be somewhere between where we are today and $1,200. The reduced to $1,200 net would be – again, we're – by the way, we're above what we've forecasted, I believe at $1,339 for the quarter that came in a good bit above. But nonetheless, when the government does open up the military, we are the only long acting…

Yes. Just I'll go back to the sales force side, and I think Rob, you said it well. What I would add is that the top prescribers across the category are overlapped greatly. And so, as Rob said, we're able to hit those 20,000 targets very efficiently. The other piece of information that I think gives you with actual results is just that what we see is a massive overlap in our writers across product categories, which sort of is the proof is in the pudding there that we're going after the right targets and it's efficient for us.

Thanks for the question, Carvey. And by the way, we do see a great appreciation next year for IMVEXXY and BIJUVA in the menopause portfolio from a net standpoint as well.

Okay. Got it. Thank you so much.

You got it. Thanks for the question.

Your next question comes from Stacy Ku from Cowen and Company. Your line is open.

Good morning. Thanks for taking my questions and congrats on the quarter.

Hey, Stacy.

So a few questions on ANNOVERA. Yes, no problem. So first, can you provide an update on the current COVID headwinds in terms of office volumes? I think previously it said it's around 50% or so. And then what's the breakdown in ANNOVERA’s scripts that are from telemedicine versus less clinic visits? Which segment is growing ANNOVERA faster? I have a follow-up question.

Sure. So if you refer to our Slide 15, we did want to put this up for people to look at. And Stacy, I'm glad you brought this up. So you can see on Slide 15, we are significantly below the access we had. And what does access mean? Typically, in a year, 10% to 15% of women will be open to switching contraception. We believe that numbers down through our research of to 4% or so. Why is that? Because they have to go to their doctor for an exam and they have to be open to it. And a lot of women, although the prescription volumes look like the news are continuing, doctors just calling in a new prescription for what they were already on, and they're not going into the office or doing a telemedicine visit or a calling until COVID lifts. Additionally, doctors are limiting reps that can come in are typically when we hear our reps are out there. But the good news is we're way off of the lows that we were back in May, right? We kind of bottomed in May at that point. And in spite of all these headwinds, we are putting up record numbers, right? And the way we're doing that is we've kind of reinvented the way we're doing speaker programs, educating doctors using Zoom or remote processes. And we feel good that unless there is a significant shutdown or headwind with COVID, we'll continue. We're definitely on track for the quarter. And we can touch on that if you want additionally around the symphony tracking and where we are with that. So with that being said on telemedicine, and I'm going to turn it over to Dawn. Telemedicine is approximately I believe 18% to 22% of our overall revenue and it is growing. Dawn?

Correct. Yes. And just to add a couple of things, back on this slide, so what you're looking at here on the slide is actually a reach and frequency, reaching the amount of doctors you can get to that's our breath, frequency being the number of times you can see them. So back to your question about COVID headwinds, the headwind outside of the switching behavior with a number of switches down for patients that that we're seeing as our ability to get in front of doctors, at least the full prescriber base. The good news is that where we can get in, we're seeing we can get in that we're a little less impacted on frequency. How we are solving for that, is what I talked about earlier in terms of anything we can do virtually as well as all the medical education that we're pushing on. And then in terms of growth, the majority of what we have put up for ANNOVERA has been through the sales force. And so they're doing a great job despite the headwinds that are in front of them. And as Rob said, telemedicine is providing a significant percentage, about 20% of our volume. And we would expect that to continue to grow depending on the environment.

Yes.

That's really helpful. And then actually on the Symphony, I think you had commented on that, in the Appendix that the menopause products are consistently understated. Should we be thinking about that as the same for ANNOVERA volume or is there going to be a lot of quarter-to-quarter variability?

Yes. We'll have Mitch walk you through, what slide number is that?

32. James D’Arecca: 32.

If you can go to Slide 32, we put a slide out in the Appendix, just to help, give some clarity as best we can around this. Go ahead Mitch.

So thank you for that question. To start with, currently ANNOVERA represents only one-hundredth of a percent of the weekly birth control reported by Symphony. So a very small fraction of what they see. And understanding Symphony’s projection methodology, in combination with ANNOVERA’s volume and the delivery of our channels we go through the telemedicine and military and the like, we believe there's under reporting. As a guide, when we look at the menopause products, historically the volumes have been underreported by an average of 10% to 15%. So we believe that's a good guide going forward. What you can count on is the Symphony trends are accurately reflecting what is happening with our sales, which is they are increasing week-over-week in October. And that we are on track to meet our fourth quarter goals.

So which in particular $20 million revenue covenant. Does that help Stacy?

Got it. And just to clarify – yes, just to clarify that, the 10% to 15% underreporting, you're saying it's a good guide going forward for ANNOVERA as well. Just, looking from that.

Yes. We really think so, and the trends are consistent and it's just so small. I mean, think about the volume of ANNOVERA, its one-hundredth of a percent of what they track. So if we're off by 50 or we're off by 300, its massive to us for 300, right. And it's just a rounding, rounding error[ph] for the folks like Symphony. But their trends are definitely in line and we're doing pretty well, doing pretty well.

Great. Thank you so much. Thanks guys.

Great. Great questions Stacy, thank you.

Your next question comes from Douglas Tsao from H.C. Wainwright, your line is open.

Hi, good morning. Couple of questions from me. First, in terms of ANNOVERA, obviously we've got some really great momentum for that product. Just curious, when we think about the progression from here, is there sort of any seasonality that we should be considering when we model, especially as we look to the first quarter of 2021, I know there are so many dynamics and it gets particularly tricky when a product is sort of going through this sort of early growth phase, but just as we think about reimbursement, co-pays, et cetera, do we typically think about that first quarter maybe being sort of a step back or flat relative to what we seem to be on track for the fourth quarter? And then just in terms of IMVEXXY, it seems like reimbursement on the Part D side is still sort of been a little more challenging than what we hope for. Just how close are you to making sort of tactical decisions in terms of the co-pay cards, et cetera, just to proactively sort of increase the gross-to-net sum for that product? Thank you.

Doug, it's Rob great questions. I'm going to pass around here, but if you brought up seasonality in birth control, if you go back to 2019 and 2020, September was way down over August – compared to August. So that is a good trend and it's on the way up.

That’s really back to school.

Yes, we call it the back to school, kind of back to school trends to point on. So from going into Q1 of next year, so it's going to be, we think pretty good for ANNOVERA. And let me tell you why, because of the state laws that we have in place today and because of the federal law, and now we're up to 28 States that have NDC that have state laws in the books. If there is co-pay with a payer, a Letter of Medical Necessity for even high-deductible plans that could have a $2,000, which is a lack price would eliminate that in most states and federally. So as you look back to our nets, which I believe in Q1 were in the high $1,300 approximately. And now we're in Q3 and we're at $1,339. It could step back a little bit. I think the bigger thing that would pull it back is, if the government gets going as well as this large PBM contract with a no longer excluding and no longer covering NuvaRing, and I know we're a long acting product and very different, But we would be the only branded ring agent on their formulary and that's approximately 20% of the entire population of the U.S. So that is a strong catalyst. It's probably stronger for IMVEXXY there, because they were so heavy with Premarin, Osphena is one of their biggest ones, Intrarosa, Estring. So I think you'll see a bigger lift there on IMVEXXY. So, as well to kind of dovetail into your nets, yes IMVEXXY is good, and I'm going to turn it over to Dawn in a second, but we do now have the visibility and it will be a lot better in next year. And we expect it to strengthen in Q4. We think our average will be a good, bit higher than it is this year. Dawn, anything to add?

I think the only thing to add Doug is, your question was, are we being proactive. And I think the two things we can point to, one is the preferred coverage that we talked about with the PBM. Again, I don't want to under-represent the significance of all the other competitors, including Premarin alone being 17% being removed. It's a really nice way to sell the product and should improve the mix because of the reduction in co-pay. The second question, you asked is around our co-pay card program. And we're absolutely looking at shifts in January as our coverage gets better to maximize gross-to-net. So we are being proactive about that.

Good. Does that cover it, Doug?

Yes, that's it. Thank you so much. Thank you.

Great. Thank you.

[Operator Instructions] Your next question comes from Dana Flanders from Guggenheim. Your line is open.

Great. Thank you very much for the questions. I just actually had a follow-up on the payer PBM strategy. And I know you just talked a little bit about the opportunity you have, getting preferred status. Just wondering if that's a shift in strategy for you and would you expect potentially more of that going forward? And then, kind of what's the level of market share you think you can get in those plans? And then just a second, a quick follow-up, can you just give us the refill rate for IMVEXXY in this quarter? Thanks.

So I'll start with, it’s Dawn. I'll start with payer PBM strategy. So, I think the first thing I want to say is that, we look at every payer and PBM differently. And so we look at each individual, so this is not an indicator of every single one going over to preferred, we knew that this PBM this would be fruitful for us, but really what you should take away is that, our entire approach from the beginning about making sure that we made this affordable for patients and driving market share gave us the opportunity to get to preferred over the other products. And so this is a really big win for us that really dovetails with the strategy we had from the beginning, but as far as going to preferred for the rest, that's not an overall approach. We'll look at it payer-by-payer.

Yes, Dana. The PBM is one where our growth is. And the growth from IMVEXXY, grabbing 12%, albeit at low net margins, here's where the story changes, right. Because they're not going to go to a shrinking product, they're going to go to a growing product because that's the one product all their patients will be covered for. So I think to Dawn's point, the market share potential here is significant, it's actually, we're always out there pushing in the past. Now we'll have PBMs at the pharmacy level pulling for us, pulling scripts in. And we're hitting our biggest branded competitor right between the eyes with one of the largest PBMs at 20%. IMVEXXY, I'm glad you break that up, no one asked that, it’s very important. We are at 6.5 fills per patient on average. So it is a really strong number. And again that's why they made these decisions, right. We're growing, it's still one branded agents are going to have going forward, which is a change and people are staying on product and they like it. So the strategy that we had with the low out-of-pocket cost to launch, even though the nets were low, is really paying-off here and you can see it. Because we didn't have the growth, we wouldn't have these contracts and there could be more in the future.

Great. Thanks and congrats on all the progress.

Thank you.

There are no further questions at this time.

Thank you, Operator. Thank you everyone for the questions today. And, I want to thank the TXMD team for a fantastic quarter and all the hard work to get the expenses down and the revenue up and we will continue to deliver. Thank you.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.