Q4 2023 scPharmaceuticals Inc Earnings Call
Participants
John Tucker; President and CEO; scPharmaceuticals, Inc.
Steve Parsons; SVP of Commercial; scPharmaceuticals Inc
Rachael Nokes; CFO; scPharmaceuticals, Inc.
TJ Gallagher; Moderator; LifeSci Advisors
Roanna Ruiz; Analyst; Leerink Partners LLC
Stacy Ku; Analyst; TD Cowen
Douglas Tsao; Analyst; H.C. Wainwright & Co., LLC
Chase Knickerbocker; Analyst; Craig Hallum, Inc.
Naz Rahman; Analyst; Maxim Group LLC
Presentation
Operator
Yes, greetings, and welcome to SC. Pharmaceuticals Fourth Quarter and Full Year 2023 earnings conference call that at this time, all participants are in a listen-only mode and a question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce [T.J. Gallagher] with LifeSci Advisors. Thank you. You may begin.
TJ Gallagher
Thank you, operator. And before turning the call over to management, I would like to make the following remarks concerning forward-looking statements. All statements on this conference call other than historical facts are forward-looking statements within the meaning of the federal securities laws, including but not limited to, statements regarding SC pharmaceuticals, expected future financial results and mint and mint expectations and plans for the business and for OpEx. The words anticipate, believe, estimate, expect, intend, guidance, confidence, target, project and other similar expressions are typically used or used typically to identify such forward-looking statements.
These forward-looking statements are not guarantees of future performance and may involve and are subject to certain risks and uncertainties and other important factors that may affect at SE pharmaceuticals, business, financial condition and other operating results. These include, but are not limited to the risk factors and other qualifications contained in SC Pharmaceuticals' annual report on Form 10 K, quarterly reports on Form 10 Q and other reports filed by the Company with the SEC to which your attention is directed. Actual outcomes and results may differ materially from what is expressed or implied by these forward-looking statements.
Any forward looking statements made in this conference call, including responses to your questions are based on current expectations as of today and SC Pharmaceuticals expressly disclaims any intent or obligation to update these forward-looking statements, except as required by law. It is now my pleasure to turn the call over to Mr. John Tucker, Chief Executive Officer of SC pharmaceuticals. John?
John Tucker
Thank you, PJ. And thanks to everyone listening to this afternoon's call and webcast to review our fourth quarter and full year 2023 results. As has been our practice, I will begin with an operational update before turning the call over to Steve Carson, our Senior Vice President, Commercial, for a more detailed update on the forensics launch, and then Rachel notes, our Chief Financial Officer for a review of our financials. We will then open the call for your questions.
Fourth quarter of 2023 for represents our third full quarter of it for oh six commercial availability as we launch the product in late February of 2023. Demand has continued to grow, reflected in our key indicators for the number of doses number of total prescribers doses filled per prescription, we believe for oh six is meeting the needs of heart failure patients suffering from fluid overload and the continued positive trend is KPI.s demonstrates that specialists continue to gain comfort prescribing it for the fourth quarter of 2023 through reported net revenue of $6.1 million, representing a sequential increase of 61% from $3.8 million for the third quarter of 2023.
And at the upper upper end of the range that we've provided in our pre-announcement press release on January fourth. This was driven predominantly by doses shipped to patients through our specialty pharmacy network. We also had direct sales of four oh six integrated delivery networks in fact, fourth quarter net revenue included a sizable order from one of the largest closed IDNs in the country towards the end of Q4. Going forward, while we expect to have sales to IDNs every quarter, including in Q1 of this year. The size of these orders can bear will cover this in more detail shortly.
Before diving further, I would like to note that in the fourth quarter, we adjusted our KPI.s from prescriptions to doses. The number of doses is a metric we use across our internal projections. That's more reflective of our current business, especially as the number of doses per prescriptions, very high gross-to-net discount from launch through the end of Q4 was running at approximately 18%, down from 21% for the end of Q3. We continue to expect the GTN discount to increase over time as contracting with payers and the marketplace evolves.
We anticipate that the GTN discount in Q1 of 2024 will increase relative to 2023 levels due to discounts. We anticipate payments inventory levels at the end of the fourth quarter at our specialty pharmacy partners were consistent with the inventory levels at the end of the third quarter. Shifting now to payers, we continue to have productive discussions with commercial Medicare Part D and Medicaid payers in an ongoing effort to make for us, it's broadly available to patients that the most favorable terms possible.
As mentioned earlier, late October, we reached an agreement with one of the largest closed IDNs in the United States by the unrestricted access to for oh six without prior authorization, over $8 million lives at a fixed co-pay ranging from 16 to $75 also as of November first, 2023 for oh six has been added on formulary as preferred brand for a one to one of the largest government retire payer formulary increasing and liberalize the preferred access to for oh six by an additional $1.1 million lives. At these favorable payer decisions, we've expanded the population of heart failure patients, but access to process to fix to fix co-pays of $100 or less 17%, moving us closer to our previously stated goal of 75% or more over time we are progressing with many other health plans, and we hope to have more announcements like these in the months to come.
To this point, we'd like to provide an update on several long-term growth initiatives that we previewed last quarter that we view as critical for our long-term growth strategy. In August, we announced favorable Type C meeting feedback from the FDA regarding the potential expansion for the forensics six indication to allow for use in New York Heart Association Class four heart failure patients for oh six is currently indicated for the treatment of conjecturing due to fluid overload, adult patients with New York Heart Association Class two and Class three cost estimate as being 10% of all heart failure patients are class for a meaningful percentage of the minus 40%, say, benefit from full doses.
Based upon direct feedback that we received from the agency we filed for the Class four indication early October of 2023. We then signed at the due dates with this offer. We are successful. We believe Class four represented the full expansion of our market opportunity and to enable for oh six to be prescribed to the most severe heart failure patients. Turning now to the 80 made by one and now auto-injector that we are developing that additional option than the on-body infuser.
We believe that an auto injector, if approved, could reduce manufacturing costs compared to the current ongoing user and confer environmental advantages remain on track to initiate a pivotal PK study in Q2 of this year, and I report results later this year that is successful. Flowers has submitted a supplemental new drug application to the FDA by the end of 2024. And finally, we announced feedback from the FDA pertaining to the potential expansion of the process indication to include treatment of anemia due to fluid overload in patients with chronic kidney disease or CKD.
And his feedback, the FDA confirmed that no additional clinical studies are needed to expand indication provided that we can demonstrate an adequate PK and pharmacodynamic bridge to the listed drug drug, which is for us a mild injection. CKD. is a progressive disease characterized by worsening renal function over time, resulting in frequent episodes of fluid overload that are treated with loop direct feed. It estimated that 12 to 15 Americans are aware that they have kidney disease and 50% of patients with CKD and to not have a diagnosis of heart failure fluid overload being one of the most common complications of CKD, which worsens with disease progression.
We believe for oh six could be beneficial to patients with CKD, but worsening symptoms through the fluid overload are not responding to all the direct for that and plan to submit a supplemental new drug application with the FDA for the CKD indication in the second quarter of 2024. Now turning to the first quarter of 2020. For the normal Q1 headwinds caused by patient out-of-pocket deductibles resetting, it's our highest dose demand and shipments for the first half of the quarter. This growth in demand and further accelerated in March.
However, the impact of the cyberattack unchanged healthcare in the third week of February and is ongoing. This has caused disruption, claims being processed, resulting in delays in patients receiving shipments that for us, a strategic position for oh six has in the treatment of heart failure patients. They're concerned that we will not see all of these units shipped. We're actively working with our specialty pharmacy partners to ship as many of these units as possible. But this pain point, we do not know if and how much this will ultimately impact quarter, intend to provide a more detailed update when we report our first quarter results at this point, I'll turn the call over to Senior Vice President of Commercial, Steve Parsons, for a deeper dive into our launch metrics. Steve?
Steve Parsons
Thank you, John. As John indicated, the fourth quarter was our third full quarter of HERO6 commercial availability, and we remain pleased with our progress from launch during December 31st. It had 1,696 unique prescribers, up 52% from the 1,119 unique prescribers from launch through September 30th. We are extremely encouraged by this growth as it reflects our strategy in 2023 of establishing a broad prescriber base. Importantly, more than half of these prescribers have written multiple prescriptions by the end of the year.
During the fourth quarter, we had 13,542 doses written and 7,106 7,016 of the dose of those doses have already been filled. There were another 4,592 doses that were still pending as Q4 ended continue to report doses written and doses filled because of the unique nature of how physicians prescribe to ROSA. Many of our physicians write prescriptions for patients in anticipation of future need due to worsening fluid overload file. These prescriptions might not be filled in the month or quarter. They are written. They do get filled when the patient needs treatment and we report the doses on the patient receives them is important to note that approximately 14% of our prescriptions were canceled during the fourth quarter of 2023. Recall that pending prescriptions are not canceled.
Whether they are still in process with the payers, some are approved and waiting in queue. So others are still in prior authorization. We filled a significant portion of these pending prescriptions in the first few weeks of 2024 and we continue to fill more pending prescriptions written in Q4 into the billed category every day. And the prescriptions that are cancelled are for various reasons, including unreachable patients who are hard to contact have been hospitalized for a small number that have that are the sales of those that are reached to cancel a high co-pay is the main reason given we anticipate the cancel rate will continue to decrease with Euro six, as is expected to become better positioned on more health plan formularies, lowering patient out-of-pocket costs and providing quicker coverage decisions during the fourth quarter.
The average number of doses per prescriptions filled was 5.9 doses, which remains higher than our long-term expectations. Our sales force has conducted 2,331 in services as of December 31st, which is up from 1,806 in services conducted as of September 30th in services, provide important training to offices on the prescribing process for oh six and mission ensures office readiness as we open more new accounts. The execution as in services remains fundamental to forensic success. Every regard number one services conducted each quarter as an important leading indicator. We said previously that we stand ready to add additional territories as demand warrants. We plan on adding additional territories in advance of our Class four and chronic kidney disease initiatives.
From a marketing perspective, we are engaged in a broad multichannel marketing campaign to drive brand awareness, adoption and commitment as programming comes accomplishes many different activities, but some of the key ongoing activities include engagement and development of key opinion leaders, conference presence, print and electronic collateral and the development of both provider and patient websites. Among other critical tests we've begun reaching out to heart failure patients and their caregivers, patient education materials for fibrosis. Overall, we're pleased with our progress. Our continued progress and the path we are on. That concludes my update. I'd like to turn the call over to our Chief Financial Officer for a dual mode for a financial update, essential banking fees.
Rachael Nokes
As of December 31st, 2023, we held $76 million in cash, cash equivalents and investments compared to $118.4 million as of December 31st, 2020. To now I will cover a few income statement items. We reported a net loss of $13.8 million for the fourth quarter of 2023 compared to a net loss of $9.2 million for the fourth quarter 2022. For the full year 2023, we reported a net loss of $54.8 million compared to a net loss of $36.8 million for the full year 2022.
Product revenues were $6.1 million for the fourth quarter of 2023. Cost of product revenues were $1.8 million. For the full year 2023. Product revenues were $13.6 million and cost of product product revenues were $3.8 million. We did not generate revenue during the fourth quarter of full year 2022 as Euro six was approved in October 2022 and commercially launched in February 2023. Research and development expenses were$ 3.3 million for the fourth quarter of 2023 compared to $2.3 million for the comparable period in 2022.
The increase in research and development expenses for the quarter ended December 31st, 2023, was primarily due to an increase in device and pharmaceutical development cost increases, partially offset by a decrease in employee related costs. For research and development expenses were $11.8 million for the full year 2023 compared to $15.5 million for the full year 2020 to decrease in research and development expenses for the full year 2023 was primarily due to a decrease in clinical study and medical affairs costs, employee related costs and quality and regulatory consulting costs.
The decrease was partially offset by an increase in pharmaceutical development costs, selling, general and administrative expenses were $16.2 million for the fourth quarter of 2023 compared with $7.2 million for the comparable period in 2022. The increase in selling, general and administrative expenses for the quarter ended December 31st, 2023 was primarily due to an increase in employee-related costs and commercial costs for the full year 2023.
We reported selling, general and administrative expenses of $53.4 million compared to $20.6 million for the full year 2022 increase in selling general and administrative expenses for the full year 2023, primarily due to an increase in employee-related costs and commercial costs following the commercial launch of HERO6 in February 2023 as well as an increase in legal costs. The increase was partially offset by a decrease in insurance related costs. Based on our current operating plan, we expect our operating cost increase in 2024 as we further support the launch of HERO6 and the development of the 88 by YML. Autogel, our auto-injector as of December 31st, 2023, we have 35,968,510 total shares outstanding. That concludes the financial update.
John Tucker
This concludes our prepared remarks. At this point, we will open the call for questions you.
Question and Answer Session
Operator
(Operator Instructions) Roanna Ruiz, Leerink Partners.
Roanna Ruiz
And so everyone has a chance onto our honorees at Leerink Partners. Thanks for taking our questions. So first one from us. Can you share some additional details on your efforts, securing some more additional IDN agreements and how you expect that could impact some of the current trends that you're seeing and the uptake of for oh six by the individual prescribers?
John Tucker
Sure, Robin, this is John and I'll have Steve jump in. So you know that the two largest IDNs in the country are Kaiser and the VA, the VA being the largest NPA. We're working with the VA. We've been selling into individual VAs this year. A key initiative for us is to be national formulary for the IDN. I mean, for the VA, we think that'll that'll drive uptake. And then with Kaiser on more of a closed system where we've already started the contract and we have we have sales in there.
So we think those two kind of are a little unique in that the really the closed integrated system and you have Geisinger who's one of those as well. So we'll continue to sell into those really hard close systems, but we really see a big expansion opportunity into into what you would call IDNs that might not have the closed part of the pharmacy involved so that the docs might be employees, but they're not on in the pharmacy. They don't have the pharmacy benefit this is this is good for us because on we can still talk about the four oh six value message, but also be able to track this the prescription.
So those would go through our regular regular our distribution network. But we anticipate that growing on a percentage of the business. There's still a lot more patients outside of the IVF world than there are in it, but we've always thought that this would be a good market for us as the value proposition is so well defined. I don't know, Steve, if you want to add anything to that?
Steve Parsons
Yes, we get we get approached by integrated delivery network hospital systems quite regularly, and they see an opportunity to shorten the length of stay in some cases by having the product available right there on campus as well as preventing unnecessary readmissions, which they pay penalties for. So they'd like to be involved in the risk distribution directly and have their doctors order it right through the EMR systems in the hospital. So there'll be more and more of that happening this year.
Roanna Ruiz
That's helpful. Thanks. And a second one from us on your CKD. label expansion efforts. So thinking of the potential launch there, if it's approved and the nephrologists, you may call on what learnings from your current forensics launch would you apply there and anything you would do differently specifically for that patient population and prescriber base?
John Tucker
And so when we look at nephrologist and they actually prescribe their failed, so more productive way than the cardiologist around how much how many loop diuretics they use. So I think, again, one learning we've had on early on and I think this will apply that to on nephrologists as well is really that you're treating that patient as soon as that patient start showing a reduced response. The oral diuretic is critical critical to get that patient feeling better critical to keep that patient from from being totally fluid overload so that that message in our market research really plays well to the nephrologists.
In fact, when we look at on any of the market research with nephrologists, I think I think they understand the value prop on. I think they're going to embrace it. We would think perhaps even earlier than cardiologists.
Roanna Ruiz
And Steve, I don't know if we know we've been calling on a small number of nephrologists already due to them having heart failure patients that it was fluid overload. Some of them are seeing cardiology patients has have tough. I refer to them to deal with the fluid overload, silicon them already, and they're very anxious to have a broader indication to the CKDI.
We've been very enthused and I'm not sure John more if you want to add anything. He's done most of the work on kidney. So we've been incredibly enthused with the response of the nephrologists to the product profile, the value prop and there's less of them. So we can cover more of them with our sales force. So we're anticipating a really a quicker uptake in nephrology than we've even seen in cardiology. I'm not sure, John, if you have anything you'd like to add to that since you've done most of your orders?
Steve Parsons
Yes, I'll just I'll just add that we're doing research and talking with nephrologists and you hear the story and you hear the description of the problem that they're describing in their patients with chronic kidney disease. If you didn't know that they were nephrologists. You think that they were cardiologists there describing the exact same problem and so when a patient reaches out to their nephrologist for worsening signs and symptoms of fluid overload, the nephrologist is inclined to treat them.
They don't say we'll go to your go to your cardiologist electric cardiologists, do it and vice versa. So it's the exact same problem, just different individual being being presented. And now that nephrologists will have that will have the opportunity they use it just like the cardiologist to just additional additional touch points.
Roanna Ruiz
Great. I really appreciate the perspective on the last one. I'm going to squeeze one in on. Can you just share the range of doses that you're seeing right now at Reverset, you mentioned the 5.5 on average, what's the range?
John Tucker
So the range, you know, we you'll see every once in a while a script for one unit, I think usually that's something we are going on. But but typically it is two or three. I think the maximum you'll see at eight, and that's for a patient is fairly volume volume overloaded, who's in a pre admission. But I think you're looking at two to eight is the range Great thanks so much.
Roanna Ruiz
Thank you, John.
Operator
Stacy Ku, TD Cowen.
Stacy Ku
Hi. Thanks so much for taking your questions. We had a few. So first, Steve, I understand you're currently focused on establishing the infrastructure and driving uptake for prescribers. But just curious, your views on expanding patient activations with etc. especially as reimbursement continues to progress. And we have a few more questions, so we'll just kind of leave them out.
First, as you also broadened out the prescriber base, are you helping these clinicians get a good sense of which patients will have reasonable co-pays just to help kind of ease of prescribing for the clinicians as they think about appropriate patients and as we think about long-term improvements is filament.
And then just a follow-up on your comments around the Change Healthcare. Clearly, cyberattack is pretty well understood issue at this point, but curious if you could provide any other additional details, is this just a delay and adjudication for copays from Q1 to Q2 as the ultimate kind of the temporary, what grounds do you anticipate any prescriptions will be lost?
And then last question, if I may. When do you think you might break out that 18 contribution? And what are your thoughts about what takes us from disclosures. Thanks so much. I can repeat the questions, if needed.
Steve Parsons
Okay. We are probably going to and I wasn't writing fast and the state and let me do the parts and what have you had any idea. And I say again, I think I'll take on from on and I'll talk about a change first. No, as I said, what's happened since February 21st. And when that when the system went down is on really the prescriptions coming in, being able to adjudicate them up co-pays and ship them. So we have I think I said it in my prepared remarks on our our demand, the number of scripts comes prescriptions and units being written.
It is way higher than at this time quarter to date last last quarter, not dramatically different from. Obviously, our units still is higher, but it's lagging the prescriptions because of the delays we're seeing. So your question is is it just the delay and do you lose some of them? I think that's that's that's the big question is yes, they're delayed. But do you see again and back, we have a workaround with our specialty pharmacy partners. We're hoping change comes back up fully online here. They've said next week.
The question is, can we can we ship everything that we should have shipped, and we're just not sure of that of that right now. We don't think you know, unless something weird happens. It's a long term. It's a long-term issue. And we remain optimistic about about making consensus for the year. But this this is a disruption for us. Right, right now. Again, it started February 21st. It's ongoing. Now. We have a work around. We knew we've been shipping units just not as many as we should be because because of the slowness of the system and we talk a little bit. So that's the first question and talk a little bit about the reporting of the IDNs.
It will depend on the IDN on and our contract with and what metrics we can report on we could we could break this the sales. I think we've said that, you know, for Q4, we think it was in that 10% to 15% range for the IDN purchases that will vary again, we have a large purchase at the very end of the year from Kaiser and we don't have visibility into what do they have. Kaiser doesn't let you see what doctor wrote, they don't want to detail on the doctors, which is crazy, but from some of the IDNs that Steve mentioned, the hospital-based ones will have more more metrics to be able to share. But unfortunately, Kaiser, I think the metrics are going to be are going to be somewhat scarce.
John Tucker
And then, Steve, you want to do you have the other questions, I think you asked about helping doctors identify patients who are going to happen with the co-pay is going to be for those patients. So they can have success and yes, we can do that work. We're pretty confident. It's like 70% of our patients. Some are are able to access the risks at a co-pay of $100 or less some of them much less. The average co-pay for the patients with a with a with a 100 left, is the $20 range and imagine anything you're going to pay $10. And Steve and a lot of the doctors are now some they're submitting prescriptions in advance of needing the product of anticipating that they're going to need drugs for a specific patient who's going towards and it's just a matter of time and they get a cost and coverage feedback.
They get an answer and they get an approval on the product. They know the company is good. And then when when the patient does get sick and does need it, that's when they call it down and it's ready to go very, very quickly. So they'll tell the patients who have the really good Coface, no hesitation at all and some people who have a higher co-pay. They may not talk about a lot of products to them until that until there's a foundational charitable funding support for those that don't know if that answers the question, but they are able to get preclearance on obviously a lot of these patients and you know, who has the really good copings.
Stacy Ku
That's really helpful. And then the first question we asked this was really curious your thoughts around activating patients. And by did you say that you're focused on on the prescribers right now, but as you progress progress, your reimbursement as you get the auto-injector, what are your thoughts there long term, we have a plan.
John Tucker
We have a strategy to reach directly out to patients and their caregivers. We did an awful lot of market research to be ready. So that we know what how they like to be communicated to what was how to reach them where to reach them. We've begun in the office direct based patient with brochures and the doctors, giving them out things. And we're building a website just for patients. We have advocacy groups, mended hearts and and hard for others that are out of connecting us with patients through their networks to a big move, often Ensign ourselves.
Stacy Ku
The patient is a big focus for us this year, more than it was in year one, we spent the first 12 months as our plan was educating cardiologists before we educated patients. So this year it will be a lot more targeted outreach to patients and caregivers are going to be doing a giant DTC campaign, you know, on survival or something?
John Tucker
Probably probably not you answered that. I think you'll see some targeted on things to patients, including potentially media as well on iPhone.
Stacy Ku
That's really helpful. Thank you. gravity counts. Thanks, Steven.
Operator
Douglas Tsao, H.C. Wainwright.
Douglas Tsao
Hi, good afternoon and thanks for taking the questions and congrats on the progress. So John, I'm just curious in terms of the change out, I mean, what percent of your business has been affected by this because it really is, is it really just United and that one payer?
John Tucker
No, Doug, it's really so if you think of, you know, United owns are often owned united on bonds change. But on our specialty, most of all of the specialty pharmacies and other payers use use Change Healthcare. So the adjudication of the scripts go through go through change. So so you could say all of our scripts for that period of time and ongoing are impacted. Now that said, it was really slow for a couple of days because what happened was everything had to be called in manually and everyone was doing the same thing. So incredibly slow. We have managed workarounds.
There's another system in place called relay that one of our other specialty pharmacies utilizes. So we we're able to move business there. That's that slow as well. But, you know, I think the work around has started to work and really what we need to do and what we're focused on. He's making sure we ship all of those. All of those scripts that were caught up when it went, it was totally down and we didn't have a workaround. It's not. And that's and you're saying it's working smoothly now. It's obviously with the work around working better.
And I think the specialty pharmacies are getting better at working through the limitations in the system. We've heard that it will be coming back online on your next week. So we're going to continue, as you know, we've asked the specialty pharmacies to put more people on to man the phones to ship the drug. So he asked what percentage of our business got impacted. Question would be what percentage of the business, what percentage of units per scribe aren't going to ship that should ship?
Douglas Tsao
That's that's the question that he thinks is relevant. It's impossible for us to give you that final answer right now, we have recovered, you know, a good portion of it. Have we recovered all of it so far?
John Tucker
No. The good thing is we're still seeing the demand come in very robustly. The docs are still writing underwriting kind of more than they've ever written. You need to be able to keep up on ship what's coming in now and then and then deal with that, that deal with those that are still sitting in the system.
Douglas Tsao
Okay. That's helpful. And then also, just are you from in terms of nephrology, are you starting to see any off-label scripts being written? I mean, I know it's challenged in terms of getting getting paid for, but I'm just curious, some plans are somewhat local.
John Tucker
We have it. You know, when we mentioned that we go to some nephrologists. So you'll see a lot of times even the cardiologists say, boy, they have heart failure and CKD. I just let the nephrologist take take care of it. So that's on label for us. That's part of our heart failure TAM. Is those patients even if they're even if they're cared for via by a nephrologist. So that would be on-label. Now if it's Class four, it wouldn't be. But if it's two and three and it's a nephrologist and they have heart failure, then that's all label and will get filled if they wrote it. And it was CKD first off, we wouldn't be promoting that at all. Second off, it probably will not be filled.
Okay, great. Thank you. Thanks, John.
Operator
Chase Knickerbocker, Craig Hallum.
Chase Knickerbocker
Good afternoon, guys. On US share. My congrats on the progress as well. Maybe to start, where are we at from an average time for adjudication of the PA's perspective and give me the average time I guess, before the Change Healthcare disruption? And then since then, should we just think of it as those a lot of those and communications have just been almost completely paused and that's what's causing the underlying disruption that you're talking about that again, everybody is experiencing.
John Tucker
Yes, we're quickly. We couldn't tell you what the average time is since since change went down I mean, it's variable on, you know, and we've got workarounds Now we still have our primary specialty pharmacy that goes through change that is in communicating claims for a change and then they get triaged on it to relay if there's an issue. So that is an impossible question for us to answer do that.
Again, the thing here too, is the data itself is very hard on seeming to get your hands on. We know that scripts coming in that we can see. Clearly, it's what's going out when they went out and and again, we've got to work around that involves a couple of other specialty pharmacies. And so the data is kind of some report on it differently. So prior after change, there's just no way to assume we can. We can tell what that is. I don't know, Steve, do you want to talk about that before the change and yet?
Steve Parsons
Not not as they're trying to be evasive, but it's a really multi factor question on how fast prescriptions get filled. It depends on what the doctor wants. We have to wait for the doctor to order the product, they can check expedited 24 hour review, meaning they want it as quickly as possible or they can check coverage and cost the determination. And that one that's more of the layaway and that could sit there after it's approved very, very quickly with no co-pay. Second sit there for weeks until the doctor wants to call it down now let's just focus on the ones where they say I want it as fast as possible.
Our brand promises will get them something the very next day when we get a quick answer from the payer and we reach the patient, we are able to ship it for next-day delivery. If we don't get a quick answer from the payer will still ship them one dose overnight for free so that they have something the very next day. And then it buys us another 24 hours to get through to the payer, get the answers for it and then ship it out for the phones.
And so that's been working very well to the satisfaction of our of our prescribers sub footsteps to do an average when you add in all these ones that purposely can be there for four weeks or even buds. We're filling prescriptions this quarter, repeatable growth them in October or November. And then finally, calling of them were very happy to have them. We do not disturb the doctors from ordering in advance and getting it pre-approve. They like to do that. We like to see them doing that, but it does impact our both our fill rate as well as our feed to dispensing.
Chase Knickerbocker
It makes sense and certainly appreciate the complexities there with that answer, some maybe some color just based on some of the color you've given around gross to net and where you expected to end the year that indicates that you expect to contract with some of these large Medicare Advantage payers at some point, call it earlier midyear this year in 2024, just kind of speak to some of that activity and the conversations that are happening in the background that kind of gives you the confidence to kind of assume that those contracts are going to get done?
John Tucker
Yes. So we've had ongoing negotiations with others, four big, big, big payers here in Medicare on and we've talked about it that on when we first went out, they didn't agree with what we offer them. We didn't agree with what they offered us. We've had a couple of iterations of that. These aren't quick iterations. You don't pick up the phone call, pick up the phone and call on Tuesday, and they give you an answer on Wednesday. So it takes some time, but we're making progress and we think it's key from if you look at net, especially next year, and we're on formulary here because of the holiday.
The Part D is going to reap reset on, but we have that we have to get these done for this year, too so we're pretty confident that it's going to happen this year. And that's why we keep messaging that the GTN. is going to go. The discount is going to go up because we're going to be paying these rebates. And again, we're not paying it unless we think it makes sense for the brand. So we do think being able to some lower co-pays for that 30% of the patients to get into $100 or less and also to speed adjudication time is important to the brand to go where it's going. So they're progressing on, you know, we said it once we sign and we'll announce them. So we still plan on doing that on and on.
Chase Knickerbocker
Yes, that's that's a blend Great. Thanks for the color, guys. I'll hop back into the fence.
John Tucker
Thanks, Chase.
Operator
Naz Rahman, Maxim Group.
Naz Rahman
Hi, everyone. Congrats on the progress on. So just a couple of questions from me on your CKY. on indication. So the first one is on what kind of a review cycle, do you expect to expect a six-month review a one-year review for the product for the indication label? And two, on how you think the reimbursement conversations and reimbursement paradigm sorry, evolve for this indication. Like are you already having discussions with payers regarding this potential label expansion, so you might see that benefit upon approval? Or do you have to kind of go back and have additional discussions and and we might see the benefit of those on discussions and reimbursement sometime later in 25.
John Tucker
Like how do you think about that Yes, I'll take the first one and Steve will take that one. As we anticipate a 10-month review, it's not a new molecular entity, which would be a 12 month on, but we anticipate and again, more file. We've said we're filing next month and then we will file in April, we'll receive our PDUFA date, but we anticipate that would be 10 months is there a chance it could be six months and there's always a chance, but but I think to be conservatives, we'd say 10 months.
But there wouldn't be a way that it could be 12 months is not only a path that way. We expect a pretty straightforward review. The IV has CKD in their label for match in the label of the IV. We did a PK study that match the level of the eye or the mass, the PK of the IV. So so we think it's a it's a pretty straightforward review and as I said before, we're we're excited.
Steve Parsons
I'm Steve, do you want to think about it is we're not negotiating for CK. hit this at this stage. Payers don't really want to do that. But we do know we know with pretty good assurance that cirrhosis or recovered the same way it is for heart failure and CKD. It'll be it's a simple prior authorization to label. And that prior off means they have to be trying generic oral diabetics, and that's just not working flow. Hero6 would be approved for acute intervention. So it will be essentially the same PA to label. Our label will have CKD and it won't be any more complicated than that.
You know, there's there's exceptions where the plans wall we'll start a review prior to approval. It's pretty rare. It's pretty it's pretty rare, though, that they spend the time on to really start reviewing on a product or indication prior to approval. Again, they do it with you. Now when things are under review at the FDA, they're more likely to have the final third?
Naz Rahman
Yes, exactly. Thanks. That was helpful. And just one last question. So I think you incremental margin. You said you plan on expanding the commercial force on for forensics on. Could you comment on what the magnitude of that expansion will be and does look the impact of change impact your timing decision making there?
John Tucker
There will be no impact unless change went from months here, right, which we don't anticipate anything anyone anticipates that, um, you know on there's no impact on how we're looking at expanding the sales force at all. So I think what our thinking has been is that expanded to 90 here midyear in front of the class for approval and then two one 25 very early next year in front of the CKD. part of the CKD. expansion. So that's that's the thinking right now, there probably no impact from change on on Change Healthcare on.
Naz Rahman
Thanks a lot. Thanks for taking my questions. And once again, congrats on the progress.
John Tucker
Thanks. I appreciate it.
Operator
There are no further questions in the queue. I'd like to hand it back to management for closing remarks.
John Tucker
Great. Thank you very much, and that concludes our call this afternoon. We remain we remain pleased with the trajectory of our forensics launch. We expect that the meaningful progress that we're making with payers will add to our momentum is heart failure patients have affordable access to for oh six. We are excited by our lifecycle initiatives as you're having productive productive discussions with the FDA and look forward to providing some updates as we progress through 2024.
Overall, I'm pleased with our progress and believe that we can build on our current momentum and look forward towards a successful year. Thank you again and have a great day.
Operator
Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.
