AxoGen, Inc. (NASDAQ:AXGN) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 04:30 pm ET

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AxoGen, Inc. (NASDAQ:AXGN) Q3 2019 Earnings Conference Call - Final Transcript

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Q & A
Analyst
Raj Denhoy

of ground us in terms of the tenure of the reps that you have currently, and when you look at the ones that have been with you for longer, how does the productivity actually look in those more experienced folks relative to some that might be newer to the organization?

Executive
Karen Zaderej

So if you look at our sales organization, we still have a little over half of the sales organization has been with us for less than a year. Slowing rep hiring will help to shift a bit of that balance, but we also expect to see efficiencies occur through many of the other initiatives that we've done. Part of this is the rebalancing of the sales team, with efforts -- without redundant efforts between the OMF specialty team, as well as the full line rep. And other things that we've talked about, like the geographic review of the territory. So that we reduce the amount of inefficient travel time that the reps have, where they can spend more time in their active accounts. And again, our goal is to drive that penetration within those active accounts. That combined with some of the coaching and training that we've put in place this year, I think gives us the framework to be able to drive that efficiency.

Analyst
Raj Denhoy

Yes. So I guess I get that you've added a lot of folks right, so less than half or more than a year, I suppose. But when you think about somebody has been there for more than a year versus someone who is just starting out, just as we try and look at what a maturing sales force could do to the revenue over the next year or two, what kind of productivity increases do you typically see when someone has been there for more than a year?

Executive
Karen Zaderej

So historically we've seen -- if I look back historically, we saw a substantial ramp up in productivity and growth. For a rep, who had been with us for more than a year and within a territory that remains consistent. And one of the things that we're doing, as we continue to evaluate our data, is we started to look and recognize that -- and this is where some of the redundancy came in, that in this year and that group of people who are sort of one to two years, ***11***

years, we felt that we had redundancy with the OMF specialty team. And that was what was reducing the productivity of that group. We believe that by eliminating that redundancy, we will restore the productivity that we saw in that group, as well as the people with more tenure.

Analyst
Raj Denhoy

Okay. Maybe I could -- well, I'll ask maybe a different line of questioning. But when you think about the pace of new sales reps, it has been 20, 25 per year for the last couple of years, we think about slowing the pace of new hires, when you look out into 2020, do you have