Intersect ENT, Inc. (NASDAQ:XENT) Q3 2018 Earnings Conference Call Transcript

Nov 05, 2018 • 08:00 am ET


Intersect ENT, Inc. (NASDAQ:XENT) Q3 2018 Earnings Conference Call Transcript


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Good morning and welcome to the Intersect ENT Third Quarter 2018 Earnings Conference Call. (Operator Instructions) Please note, this event is being recorded. I now would like to turn the conference over to Jeri Hilleman, Chief Financial Officer. Please go ahead.

Jeryl Hilleman

Thank you, Keith, and thank you all for participating on today's call. Joining me today is Lisa Earnhardt, President and CEO.

Before we begin, I'd like to remind you that we will make forward-looking statements within the meaning of federal securities laws. Actual results and timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, our outlook for financial performance, sales force growth, clinical studies, approval of new products and indications and procurement of reimbursement codes and coverage, which are based upon our current estimates and assumptions as well as other risks detailed from time to time in the reports we file with the SEC. We disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein.I'll now turn the call over to Lisa Earnhardt. Lisa?

Lisa Earnhardt

Good morning. I'm pleased to report a solid Q3 including positive results and strong execution on the initiatives that we outlined on our last call. We have made significant progress on improving SINUVA product access and growing our field reimbursement and sales teams. The feedback from physicians and patients on their SINUVA experience continues to be enthusiastic and gratifying and we are proud with the strides we are making on access.

Before we dive into our Q3 results, I'd like to first address the status of the SINUVA J-Code. This past Friday, CMS issued their HOPPS Final Rule, which listed many new J-Codes, but did not include one for SINUVA. The final decision will be reflected in CMS's 2019 HCPC file, which is yet to be posted. However, based on the lack of a specific code within the HOPPS Rule, we do not expect to receive a product-specific J-Code in this round. To interpret what this means, we refer back to the preliminary decision issued by CMS in May. In this communication, CMS left it up to individual payers to determine the appropriate code for submission including a miscellaneous code.

Today, commercial payers have accepted use of the unassigned J-Code for prior authorization and payment and payers that have described coding in their policies have recommended use of the unassigned J-Code. All in all, while use of an unassigned J-Code adds some inefficiency to both the prior authorization and claims processes, it has served effectively for both. We, therefore, expect to continue our plans to ramp SINUVA meaningfully next year. This view is supported by the significant progress we have made with payers and with the favorable experience to date in both the rate of prior authorization and payment. SINUVA has recently received positive coverage decisions by Aetna and HCFC, the largest of the Blues behind Anthem, and has also been added a formulary by both