Hey, good afternoon, everyone. Welcome again to the thirty-fifth annual Piper Sandler Healthcare Conference. I'm David Amsellem from the pharma team, and with us is Mark Foley, CEO of Revance. Thanks for joining us. So lots to talk about, so we'll just dive right in if that's okay. So, I think what's top of mind lately is the change in pricing structure- Sure. For DAXXIFY. So, just at a high level, maybe talk to how your customers and prospective customers are perceiving the change in pricing structure for DAXXIFY, and what kind of feedback you're getting. Sure. So, you know, just to kind of walk back a little bit, if you, if you think about the journey and how we got there and what prompted the change, you know, we, we launched into the aesthetic market here in the U.S. three years ago with the RHA line of fillers. Differentiated line of fillers, a lot of international experience, but with a very measured strategy focused on training and education, doc, to be able to harness the, the product. And so we have had a, a very successful launch by all accounts over the past three years to get to the share where we are today. That plan worked really well, and so we said, "Let's go with that for Daxi," which is a preview launch, targeted launch, followed by learnings and full, full market launch. We didn't have the benefit of international experience prior to coming in. We had clinical trial data in aesthetics and therapeutics. We had a lot of market research, we had focus groups, and we had feedback, which said, based on the duration profile of these products, coming in with a premium price makes sense, so that's what we went to market with. As we got out into the market, what we were hearing from some of our accounts is median duration of six months with a premium price, some patients start to expect no movement at six months- Mm-hmm. When you start attaching a premium to it. We tried to better understand, was this something that was a training and education, or was it just the practical realities of the market? We felt like through the summer months, after we got into the full launch, that we started to get enough feedback to say, "We can continue to grind it out this way, but it's gonna be a longer, slower journey, or we can make this a pricing adjustment." When we dug in with these accounts, they said, "Listen, we think it's a better product. We think it kicks in faster, we like the skin quality, and we believe it lasts longer, but this is a meaningful barrier to how we operationalize it in our practices, because when we start having to have a switch discussion with a patient that carries with it a healthy premium, the expectations go up. So we pressure-tested and said, "Well, what is it we'd like to see?" And they said, "Listen, if you could price it in line with other toxins- Mm-hmm. - then we think the switch discussion becomes much easier, and now we can give them the benefits of this product for a price that they would pay for the other toxin, we think that makes sense." So that was the feedback that we had before we made the change. Since we've made that change, we've gone back to a lot of these folks, and I've been at, recently, a dermatology meeting in Chicago. I've been meeting with a lot of customers, and they're all saying, "This was clearly the right strategy move. It's making the switch discussions much easier. I'm able to now give the patients the ability to experience the benefits of this product without necessarily carrying with it a premium." So it's early innings for us. Yep. We've been very clear that we're gonna go back to those accounts that we originally sold DAXXIFY to, that we trained, which we said by the end of Q3 is around 2,500 accounts. Mm-hmm. We've got a range of responses. We have some are saying, "Thank goodness, this is the last piece that I needed to convert more patients." We've had some who felt a little bit like, "Hey, I leaned in heavy on this six months. I had to retreat and touch some patients up. I need you to work with me to help me feel like I'm being made whole here. Yeah. And then we have some, too, who've said: "Hey, listen, I get it. The change makes sense, but right now it's busy holiday season. You know, we wanna... This is gonna take a little bit of effort. Let's figure out the right time to do that. Yeah. But we're in that journey. As we saw in Q3, two-thirds of our revenue came from reordering accounts, which is the trend we want to see. We're convinced this is the right strategy. We believe we still have the best-in-class product, and that with the strategy change, we can unlock the share that we're looking for over time. Is some of this feedback you're getting, you had gotten from practices, mainly docs, who just are looking for better margins? In other words, are they... You know, I get everything you're saying, but is there, you know, a subtext- Right which is that: "Okay, yeah, sure. Nice, great product, like how it profiles, but, you know, what, what we really want- Right. is to make more money on it? Yeah. I mean, listen, there's always gonna be some of that, and it's a bell curve. Sure. I still think the sweet part of the bell curve, where people were struggling with that switch discussion, once you start assigning a healthy premium to it. Yeah. You're gonna have some on the other end. I had some who say to me, "I don't like the pricing change because I always viewed this as a premium product, and in my practice, I really liked it because it stood out as premium and it further differentiated, differentiated me. I figured out the pricing and on the margin," but that was a smaller group. And then we probably have some on the other end who like it for the pricing and the margin side of it. But I think that bell curve was pretty sincere in saying: Listen, we, we think it's a better product. We want to make it work. But I had a plastic surgeon who told me: "Listen, I can make it work because I've got the gravitas with my clients. Sure. But some of the other injectors in my practice, if they recommend this, and they have a few of their patients that come back, they get skittish on it because it's attached to a premium, and if you could price it in line, and they could give their patients more value." So I think most of it was pretty sincere feedback. Yeah. Do you think... And I don't want to spend too much time- Sure. - looking backwards. Right. But do you think there were some missteps regarding your messaging in terms of what practitioners perceive were the benefits? In other words, I mean, it seems like a lot of folks got stuck on this six-month idea, when in reality, it seems like this is a product that not just because I don't want to downplay it, but acts, you know, lasts, say, 50% longer. You get two months on Botox, you get three months on DAXXIFY. In three months, you get four and a half months on DAXXIFY, and so on and so forth. So do you think that there was something about the messaging that was off? Yeah, listen, I think now going back with the benefit of, you know, sort of hindsight- Sure. You could, you would probably soften that a little bit. Mm-hmm. Listen, what we also know is that every product has some level of variability. Yeah. You can take any of the toxins out there, there isn't a data point that everybody's going to say, "Oh, this product always delivers this duration. Sure. I think that every one of them is going to have some level of variability in terms of what area did you treat, which patient, different patients are going to get less, different more. I think you're right, that this median, maybe we could have done a better job on that, but I still think as soon as you start attaching a healthy premium to it, expectations. Everybody knows what no movement looks like. Mm-hmm. When you start getting into mild, but you're still not back to baseline, if you paid twice as much for the treatment, you might feel like it's not lasting, when in reality, it still is lasting- Mm-hmm ... but your perception is different. When you price it more in line, if you get a benefit, then you start to feel like, "Okay, then that makes sense. Okay. All right, that's helpful. So how has the new pricing structure impacted your ability to gain traction with accounts that have not been trained on DAXXIFY, but have shown interest in the product? Yeah. Well, again, our stated goal is let's go back and reengage those- Yeah ... that we did start with. That's been the primary focus. Mm-hmm. We are adding new accounts for sure, so it's streamlined that process for sure, because I think we're able to walk them through, "Here's the learning journey. This is- I don't know if it's me or... Okay, anyways. So, you know, it's allowing them to, to streamline that onboarding process, where they can share with them what the learnings and the insights were, and it should make it more straightforward. Now, I do think that- Uh. Is that better? But we would expect these new accounts to go through the normal onboarding journey as the original ones, which is, "Okay, this makes a lot of sense. We can price it this way. I'm going to treat a number of patients, but I'm still probably going to wait a little bit to see what my experience," which is what a normal adoption curve would be with any product. Okay. So to be clear, you are adding new accounts. I know that. You know, I don't want to get into, you know, "Hey, what's the fourth quarter looking like? Yeah. But, you know, it's a fair question. It's the most important quarter of the year- Sure ... for the facial injectable space. So, you know, we're two months in. Obviously, the holiday season is kicking into high gear. So can you talk qualitatively to the traction you're getting on DAXXIFY? I'll also ask on RHA the same question later on in the discussion, but maybe help us understand at least, you know, what you're seeing and hearing out there. Yeah. Well, and, contextualize it, because, again, we've been very clear that our plan is to circle back up with accounts, to not chase a number, which, if you look at any part of our launch, particularly with RHA, it was a combination of new account ads- Mm-hmm ... and existing. And so we prioritize, let's circle back. We've also said we expect growth Q3 to Q4. Mm-hmm. And we like what we're seeing in the market. We've also said that typically in any given quarter, normally the third month of the quarter is probably 50% or so of what the revenue is. So we're early. We like what we're seeing. We're convinced it's the right strategy change. We're continuing to get good validation points from the market, that this makes a lot of sense and will make it easier. And I think over time, it, it gives us an opportunity to participate in a broader part of the market for that reason. Mm-hmm. But, you know, we continue to believe this is the right strategy move. Just going back to your comment, so you said about in this quarter about 50% of your business is going to come from the- No ... the last month? Most quarters. Oh, most quarters. Yeah. Okay. Yeah. And part of it is, you know, listen, there can be a disconnect between usage and buying, and all manufacturers create incentives for people to make certain purchases at the end of a quarter, which has some carryover effect into the beginning quarter. So just sort of looking back at how things have played out the last few months, what's the extent to which there's some degree of, you know, fences to mend with accounts or even reputational damage, given the change in pricing? And actually, I want to even broaden the question, the fence mending piece, because preview- Yeah ... I think there were some accounts that were not that pleased about being locked out of preview. Right. So help us understand, you know, what you're doing to try to rebuild or- Yeah ... reengage with these accounts that may not be that happy. Yeah. One, I was going to point that out. You hit the two sort of buckets of fences we have to mend. Part of it is the preview accounts and those that weren't part of that, who didn't get early access, who felt a little bit marginalized, or why not us? Right. And listen, it was a no-win situation, and for all the right reasons, we went in a measured passion. Can you imagine if we had sold into 15,000 accounts and we were trying to implement sort of the pricing change, and we'd had this? So it, it, it's clearly proven to be the right strategy, that we knew we were going to learn things because all we had was clinical trial data, really in the glabella from a Phase 3 program, and that we went in a measured way to learn, which we did. Now, could we have managed that better and managed the relationships a little better? I'm sure you can always do things a little bit better. So that group, we've got some work to do, and I think, you know, we are going in, laying out the strategy and the changes and why we did it. On the group that were early users of the product, where we need to mend fences is if they feel like they had a number of patients came back that they had to do touch-ups and treatments, or they still have some product on the shelf that they paid more money for. And listen, we want to be a good partner. We were very clear we were going to start with those where we had an RHA relationship, so we already have a legacy relationship with us. They've already made the decision to lean in with us because they think we've got really good products. And, you know, we're very sincere. Like, "Hey, here's what we learned, here's where we made some missteps. How do we make it right? How can we be a better partner?" And listen, most people are open to that. Some, if they aren't open to it, it's, I would say, more of a timing thing of, "Hey, listen, we put a lot of effort into this, give us a little bit of a breather here." But we still have, as we said, over 7,000 accounts we have a relationship with. We've only showed Daxi in the 2,500, so we have still a healthy base of those that we already have a relationship with, that we haven't sold into as well, and those that we can move beyond that range as well. So, I wanted to ask you about pricing going forward in the toxin market. To the extent that the market does become more crowded, I'm thinking of, like, Hugel- Sure. If they get approval at some point. How do you see pricing evolving? Well, listen, I think there are players already in the market that compete aggressively on price today. So the market has options- You mean Evolus, for instance? Well, yeah. And, you know, there are others, too, that compete aggressively. So there are options for accounts that want to try and lower their acquisition costs, and so this has been in play for a while. So if you look at, you know, a Hugel coming into the market, maybe it puts a little bit more emphasis on that, but that already exists today, which is why I think product differentiation becomes important. So as we compete in the market, we certainly didn't feel, and we weren't hearing from the market, that because of the performance profile of our product, that to compete, we need to be at a discount, right? To be able to go up against a market leader with a lot of recognition and some of the others at price, you know, alignment, but yet with better value, we think that that's a winning strategy. So we still think there will be segmentation in the market of those that sort of really want sort of a premium experience, and then those that maybe are a little bit more focused on acquisition costs and sort of that value. And I think that will continue. Same with our fillers. I think our fillers, you know, in many cases, they can be a little less, but maybe a little more, but people pick and choose based on the performance of the product. Sure. So let's talk about the fillers. Actually, before we do that, let's talk about sales force sizing. So you did have the significant expansion. I think you went from 100 to 150. Are you right-sized at present? Any plans down the road for further sales force expansion? Yeah. For now, we feel we're right-sized. Mm-hmm. So, you know, we're at 150. To your point, we went from 100 to 150 in kind of late Q1, early Q2. We think we're right for where we are. Our size of our sales force will always somewhat correlate with the size of the revenue and sort of how much we think an individual rep can manage. And we will always do these in sort of step functions. We don't think it makes sense, "Hey, we added another 10 this quarter" right? It would typically be when you add more sales reps, it has to do with sort of, okay, we added another 50 or so. You know, we size our competitors, like, Galderma's in the 300s, Allergan's pushing 500. Based on the size of the market, there's room, but we think we're right-sized for where we are, at least for some period of time. Well, to be fair, with Allergan, they're calling on all 40,000- Correct ... injectors, and that's not, that's not your strategy. Correct. Correct. At least now. Correct. Yeah. Yeah. Okay. Got it. Okay, RHA. Let's make sure we spend some time on RHA. So, I guess I'll start with a question broadly about the filler space, and how you think it'll trend in 2024 in light of the headwinds we've seen, and it is more sensitive to macroeconomic headwinds relative to the toxins. We've seen that play out recently. We've seen that play out historically. Do you see significant evidence of recovery, and what does that do to a relatively young product like RHA? Well, listen, again, Q3, we grew roughly 23%, 3 years into the launch, so it's not like we're early innings on that launch. Sure. We're about a 9% share, depending on, you know, how, if you look at annualizing our year. And there have been reports of softness in the market, some of the market leaders seeing down year-over-year. So in a... What I'd say is a softening environment, which Q3 was, we've continued to grow. I think it speaks to the launch strategy, the execution of the team, and the quality of the products. Because we're still only in 7,000 accounts out of 40,000, we believe we still have room to run and expand. Now, the sales reps that are selling the filler, also the sales reps that are selling the toxin, we're asking them to double back around with those accounts. So we think we still have room for growth to go deeper and to go broader. Even if there's some softness in the market, based on where we are in our evolution, we still feel good about our ability to drive growth. Is the softness mainly a function of the inflationary environment, or are there other things that we should be mindful of as we think about just overall filler trends? So definitely, you know, I was talking to some derm, dermatologists at the ASDS meeting. We did hear some said, "Listen, our volume is still pretty healthy, but our per-ticket spend is a little down." Now, that's a smaller subset of the market because that's derms. Mm-hmm. These are anecdotal. Again, we saw healthier growth in Q3. We've had some people sort of raise the question with some of the GLP-1 spend: is that competing for dollars in the elective market? And if it's a headwind in the near, near term, could it be a tailwind later? Because as people hit a new steady state, you've heard about Ozempic face and others, will we start to see some of these folks now coming back for fillers and other things where maybe they weren't in the market before or they wanted to spend? The overall growth trends in this market continue to be very positive, even if there's some potential softness in this market. We continue to like where we're positioned and see growth. Obviously, some of the players have a broader footprint and maybe have more susceptibility to different segments of the market. But sort of where we're sitting today, we think it's still a very good market. Well, actually, you bring up an interesting point about- Right - the GLP-1s, and I wanted to ask you about that. So that's interesting. So in the near term, you might have a paradigm where consumers are, you know, potentially using more of their disposable income on, you know, weight loss. Mm-hmm. But I guess longer term, what I'm particularly interested in is what you think happens to the filler market in particular, because when you do lose weight, you know, there's more facial laxity. Yeah. Does it benefit the filler market in a profound way? Could it benefit the toxin market as well? How do you think about that? Yeah. Well, I mean, certainly you would think that that is the potential case, right? 'Cause you definitely lose a little bit more fat in the face, and I do think as people lose weight, they're gonna notice things perhaps that they didn't notice before, and once they hit a steady state. And I do think some of the wrinkles could become deeper as you lose a little bit of fat as well. And so it's not unreasonable to think that it might be a tailwind over time as people hit sort of a new steady state on that, on that side of it. But it's early innings on that. Yeah. Specific to RHA, what SKUs have been gaining the most traction? And I'm particularly interested in Redensity- Right and the impact of that product, or that SKU, I should say. Yeah, I would. You know, listen, Redensity has been a great add to the product line, and it's probably the most differentiated of our products because of how superficially it's injected, and the more superficial, the more important is that the gel moves with the facial movement. Otherwise, it looks artificial. And since it's a very light gel, it performs well. Having said that, the amount of volume that they inject is a little lower. So while it might be used on more procedures, the amount of product that you use. So we see a pretty good healthy mix across all of the SKUs with Redensity, I think, being perceived as the most differentiated. Wonderful. I wanted to switch gears and spend the few minutes we have left talking- Right - about therapeutic applications of DAXXIFY. And, let's start with just the early launch. You have something of a preview program here. Can you just talk through the preview program for cervical dystonia and what kind of traction you're getting with that limited audience? Yeah, a couple of things that are really interesting as we've got into the therapeutic market. So one is when we did our trials in CD, it's before we appreciated the toxin to toxin comparison. So the CD trial was set up with 125 units of DAXXIFY and 250 units of DAXXIFY. If you look at an average toxin patient, they're gonna get on average around 250 units for DAXXIFY. So we are seeing the duration benefit at one-to-one dosing, which would mean half of the amount of toxin compared to, to others. And so that creates an economic benefit for payers with the new pricing structure because they're like, "Wow, this is meaningfully less expensive at these types of doses." To be determined if that's sort of ultimately how they inject it. Number 2 is when we got into the CD market, there was a paper put out there that over 80% of CD patients have symptom breakthrough before week 12. They cannot get reinjected until week 12 because all toxins have a black box warning, and payers won't pay for it if you get injected before week 12. So this is a debilitating condition where a lot of the patients are not well controlled or managed for the full duration. So the duration expectation there in talking to these clinicians is longer duration would be great, but if you can manage the symptoms better within this 12-week treatment and you don't see breakthrough, that's a huge win. So what I will say is that within the neurology community, there's huge excitement. They're very encouraged by the fact that now there appears to be something that's new that might be able to offer their patients something they didn't have before. The pharmacoeconomics are compelling, where we've already seen the top commercial payer issue coverage for it, and we have a top ten that gave us undifferentiated coverage, meaning we're covered as a toxin in their payer universe. As a category. It could be used in upper limb spasticity- Yeah - or... So these payers ultimately make these decisions in terms of based on the data, what they feel comfortable with. So we've already got 70 million lives covered even before we have our J code. Mm-hmm. So there's cautious optimism. I would say that the early feedback from the 20 or so injecting sites that we have is very encouraged. They tend to go slow with any new product because they're most concerned initially about safety risk. Sure. Then they will dose them up. The other thing that they really liked from our data was the favorable safety profile. So dysphagia and muscle weakness, which are the two they're most concerned, we were in low single digits, which is very favorable compared to some of the other published data that's out there. So listen, we think this could be a very meaningful product within the therapeutics category, and we're, you know, making good progress with the commercial payers, and so as we get further down that road, we'll, we'll have, you know, more insights that we can share. So as you think about therapeutics, it may not necessarily be an imperative to spend a lot on R&D in, say, upper limb or other settings if you're gonna get covered, as you know, just as a category. Is that how you're thinking about it? Well, listen, you know, toxins are the twelfth most expensive category, so. Yeah - There's a lot of interest on the payers to figure out how to manage costs there. Sure. Number 2, each of these plans writes their own payer coverage that determines sort of use, dosing, and everything else. Mm-hmm. And we do know that in some of these coverage plans, that some of the other toxins, based on how they regulate them, are able to be used in other indications that they don't have an indication for. So we're gonna focus on successfully generating data and traction in CD. We're gonna work hard with the payers to make sure that we're covered in CD. Mm-hmm. Ultimately, they will determine, you know, the payers, how they choose to write us into their coverage policies, and based on that, we will see kind of ultimately where things shake out. Can you just talk briefly, and we have maybe less- Right ... less than 30 seconds, just about the cost structure and, you know, what you are doing to, you know, manage the cost structure, at least till you are, you know, getting profitable and you can start to self-fund R&D initiatives. Yeah, listen, we've got a complex business between the Viatris biosimilar, the Fosun partnership, therapeutics- Yep ... aesthetics, filler, international. Given today's economic climate, I think everybody's trying to be a little more judicious. Sure. So we divested the OPUL platform, spending $20 million a year. We liked it strategically long term, but we didn't think that was the best ROI. So we're doing that pretty much across the organization. We looked at supply chain, we've looked at, you know, some of the other areas. And so I think, you know, as we work our way through kind of building the foundation for DAXXIFY based on the price change, we want to make sure that we have that operational flexibility- Mm-hmm ... to have the runway to make sure that we can deliver on that cash flow break even in 2025, which we still feel good about. Okay, great. Well, we're out of time. Thanks, Mark. Thanks, everyone. Great ... in the audience. Thank you much.