Organogenesis Holdings Inc (NASDAQ:ORGO) Q3 2019 Earnings Conference Call - Final Transcript

Nov 12, 2019 • 05:00 pm ET

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Organogenesis Holdings Inc (NASDAQ:ORGO) Q3 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you sir. [Operator Instructions] And our first question will come from Matt Miksic of Credit Suisse. Your line is open.

Analyst
Victor Lin

Hey, good afternoon. This is Vic for Matt. Thank you for taking my question. First off, congrats on the great quarter. I'm just wondering if you can provide a bit more clarity on what's driving growth in PuraPly. Last quarter you called out some of the smaller sizes and additional physician specialties -- specialties. Can you provide us an update on that please. And I have one follow-up. Thanks.

Executive
Gary S. Gillheeney

Sure. Well in addition to the sizes that we offer, which expanded the the portfolio to make it more attractive in certain sites of care, we have different reimbursement models for different sites of care, but more importantly, the number of accounts that we're purchasing PuraPly in the past are now purchasing more PuraPly. So we've driven PuraPly deeper in the existing accounts. We also have a lot of new accounts that have never purchased PuraPly as well. And what we're seeing is accounts that only bought PuraPly have also purchased additional Organogenesis products, which is not directly related to your question, but we're seeing an expansion in all the products, all driven by PuraPly. And we are seeing more sales in different physician specialties such as dermatology, plastic surgery and even a little in trauma. So the strategy is working. The brand is expanding and the number of surgical specialties utilizing the product is expanding as well.

Analyst
Victor Lin

Great, that's super helpful. Just one follow-up if I could. With regards to your sales reps and independent agencies, it looks like it didn't really change from Q2. So how should we think about that for the fourth quarter and going into next year? Thank you.

Executive
Gary S. Gillheeney

Sure, great question. So we slowed our hiring of our sales reps in Q3 because of the amniotic capacity issues we had so we solved that capacity issue at the end of Q3 and we now are in the process of hiring additional reps in Q4. So we're still guiding to have in the range of 265-275 direct sales reps by the end of the year.

Operator
Operator

The next question will come from Ryan Zimmerman of BTIG. Your line is open.

Analyst
Ryan Zimmerman

All right, great, thanks Gary, Tim, congrats on the progress. I want to dig into the guidance a little bit to start. You moved up guidance for the year about a hair about $0.5 million overall, but you did move the segments around a little bit particularly within AWC as a little lower than previously guided. And then conversely sports med -- surgical and sports med went higher. And so maybe if you kind of just dissect the puts and takes there a little bit kind of what's driving that and particularly what drove AWC in the quarter relative to surgical and sports med where we were -- we did a little better than we were expecting. Thank you. And I have a follow-up.

Executive
Gary S. Gillheeney

Tim, do you