Ontrak Inc (OTRK) 2023 Q3 法說會逐字稿

Good day and thank you for standing by, and welcome to the Ontrak third quarter 2020 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded. I would like to introduce your host for today's call, Ryan Halsted. Please go ahead.

美好的一天，感謝您的耐心等待，歡迎參加 Ontrak 2020 年第三季財報電話會議。 （操作員指示）請注意，今天的會議正在錄製中。我想介紹一下今天電話會議的主持人瑞安·霍爾斯特德 (Ryan Halsted)。請繼續。

And thank you, operator, and thank you all for participating in today's call. Joining me today are Brandon LaVerne, Chief Executive Officer, and Chief Operating Officer, Mary Lou Osborne, President and Chief Commercial Officer, and James Park, Chief Financial Officer.

謝謝接線員，也謝謝大家參加今天的電話會議。今天與我一起出席的有首席執行官兼首席營運官布蘭登·拉維恩(Brandon LaVerne)、總裁兼首席商務官瑪麗·盧·奧斯本(Mary Lou Osborne) 以及首席財務官詹姆斯·帕克(James Park)。

Earlier today, Ontrak released financial results for the quarter ending September 30, 2023. A copy of the press release is available on the company's website.

今天早些時候，Ontrak 發布了截至 2023 年 9 月 30 日的季度財務業績。新聞稿的副本可在該公司網站上取得。

Before we begin, I would like to make the following remarks concerning forward-looking statements. All statements in this conference call other than historical facts are forward-looking statements. The words anticipate, believes, estimates, expects, intends, guidance, confidence, targets, projects, and some other expressions typically are used to identify forward-looking statements.

在開始之前，我想就前瞻性陳述發表以下評論。本次電話會議中除歷史事實外的所有陳述均為前瞻性陳述。預期、相信、估計、預期、打算、指導、信心、目標、項目和其他一些表達方式通常用於識別前瞻性陳述。

These forward-looking statements are not guarantees of future performance, but may involve and are subject to certain risks and uncertainties. Other factors that may affect Ontrak business, financial condition and other operating results which include, but are not limited to, the risk factors described in the Risk Factors sections of the Form 10-K and Form 10-Q as filed with the SEC.

這些前瞻性陳述並非對未來績效的保證，但可能涉及並受到某些風險和不確定性的影響。可能影響 Ontrak 業務、財務狀況和其他經營績效的其他因素，包括但不限於向 SEC 提交的表格 10-K 和表格 10-Q 的風險因素部分中所述的風險因素。

Therefore, actual outcomes and results may differ materially from those expressed or implied by these forward-looking statements Ontrak expressly disclaims any intent or obligation to update these forward-looking statements.

因此，實際結果和結果可能與這些前瞻性陳述明示或暗示的結果和結果有重大差異，Ontrak 明確否認有任何更新這些前瞻性陳述的意圖或義務。

With that, I'd like to turn the call over to Brandon.

說到這裡，我想把電話轉給布蘭登。

Thanks, Ryan. Good afternoon, everybody. We're excited to share details on our recent customer signing as well as three prospects that we feel are close to a final signature. We're experiencing noticeable momentum in our sales pipeline and believe that continued improvements in our clinical outcomes and technology solutions have resulted in increased traction with prospects.

謝謝，瑞安。大家下午好。我們很高興分享我們最近客戶簽約的詳細資訊以及我們認為接近最終簽約的三個潛在客戶。我們的銷售管道正在經歷顯著的成長勢頭，並相信我們的臨床結果和技術解決方案的持續改進已經增加了對前景的吸引力。

I believe the enhancements we have made to our product strategy with our whole health suite of behavior health solutions has played a major role in the business momentum. We are seeing all of us at Ontrak health are deeply grateful to our new and existing customers for their support and shared commitment to helping improve the health and save the lives of as many members as possible.

我相信，我們透過行為健康解決方案的整套健康套件對產品策略進行的增強在業務發展勢頭中發揮了重要作用。我們看到 Ontrak health 的所有人都深深感謝我們的新舊客戶的支持以及共同致力於幫助改善健康並挽救盡可能多的會員的生命。

Mary Lou will share more specifics on the new sales activity in a moment, but first, let me cover highlights of some of our achievements over the past quarter, our ongoing patient reported outcomes study findings demonstrate that our Whole Health Plus product is resulting in improved anxiety and depressive symptom management, reinforcing our commitment to delivering durable outcomes for our members.

Mary Lou 稍後將分享有關新銷售活動的更多細節，但首先，讓我介紹一下我們在過去一個季度所取得的一些成就的亮點，我們正在進行的患者報告結果研究結果表明，我們的Whole Health Plus 產品正在改善焦慮和憂鬱症狀管理，強化了我們為會員提供持久成果的承諾。

Leveraging industry recognized assessments such as PHQ9 and GAD7, we've witnessed significant reductions in anxiety and depressive symptoms among assessed members. Notably, 60% of members demonstrated a clinically significant five point reduction in anxiety symptoms and 53% showed the same reduction in depressive symptoms.

利用業界認可的評估（例如 PHQ9 和 GAD7），我們見證了受評估會員的焦慮和憂鬱症狀顯著減少。值得注意的是，60% 的會員表現出臨床上顯著的焦慮症狀減輕了 5 個百分點，53% 的會員表現出憂鬱症狀同樣減輕。

Analysis of our Q3 data also demonstrates Ontrak ability to identify members with unaddressed behavioral health needs and coach them into care, leveraging thousands of in-network behavior health providers leading to new and updated diagnoses across the company's book of business, 42% of members diagnosed with substance use disorder did not have the diagnosis showing in the prior year's claims prior to enrollment in Ontrak, Whole Health Plus program.

對第三季數據的分析還表明，Ontrak 有能力識別具有未解決的行為健康需求的會員，並指導他們進行護理，利用數千名網絡內行為健康提供者在公司業務範圍內進行新的和更新的診斷，42% 的會員得到診斷患有物質使用障礙的人在加入 Ontrak Whole Health Plus 計劃之前沒有上一年的索賠中顯示的診斷。

Other behavioral health conditions with similar post enrollment results include 27% for depression, 27% for bipolar disorder, 21% for anxiety and 20% for schizophrenia. Ontrak ability to support the identification engagement and documentation of high cost, high risk members, effectively a healthcare payers and providers focused on improving the management of their chronically ill members with unaddressed behavioral health conditions as well as our documentation for risk adjusted revenue.

其他入組後結果相似的行為健康狀況包括 27% 為憂鬱症、27% 為躁鬱症、21% 為焦慮症和 20% 為精神分裂症。 Ontrak 有能力支援高成本、高風險會員的識別參與和記錄，有效地支援醫療保健支付者和提供者專注於改善對行為健康狀況未解決的慢性病會員的管理，以及我們的風險調整收入記錄。

We recently released preliminary results from a retrospective observational study showing significant health care cost savings across Medicaid members. Over 24-months the study results demonstrate our commitment to evidence-based solutions and data-driven insights that are leading to statistically significant savings for Medicaid members, the graduated from the Whole Health Plus program.

我們最近發布了一項回顧性觀察研究的初步結果，顯示醫療補助成員的醫療保健成本顯著節省。超過 24 個月的研究結果證明了我們對基於證據的解決方案和數據驅動的見解的承諾，這些解決方案為畢業於 Whole Health Plus 計劃的 Medicaid 會員帶來了統計上顯著的節省。

Also in recent weeks, we announced the successful deployment of the Transcend core EDA gateway, a notable achievement that simplifies electronic data interchange supports HIPAA compliance and optimizes data transactions for our providers and health plan customers. This will enable us to process well over 0.5 billion claims data transactions in the coming year and significantly reduce turnaround times.

同樣在最近幾週，我們宣布成功部署Transcend 核心EDA 網關，這是一項顯著的成就，它簡化了電子數據交換，支持HIPAA 合規性，並優化了我們的提供者和健康計劃客戶的數據交易。這將使我們能夠在來年處理超過 5 億筆索賠資料交易，並大幅縮短週轉時間。

During the past two quarterly calls, I summarized some of the augmented intelligence and operational enhancements we implemented during the first and second quarter of 2023. I'd now like to highlight some of the tangible results of those implementations, each of which improves the efficiency of our care coaches and other frontline staff.

在過去的兩次季度電話會議中，我總結了我們在2023 年第一季和第二季實施的一些增強智慧和營運增強功能。現在我想重點介紹這些實施的一些切實成果，每項成果都提高了效率我們的護理教練和其他前線工作人員。

Number one, our virtual assistant L&R continues to help deliver an increase in member retention rates through a cadence of automated calls that provide check-ins on health status, capture member needs and scheduled calls with care coaches.

第一，我們的虛擬助理 L&R 繼續透過一系列自動呼叫來幫助提高會員保留率，這些自動呼叫提供健康狀況檢查、捕獲會員需求以及與護理教練的預定通話。

During Q3, we saw the efforts of that outreach continue with a 42% reduction in our no-contact disenrollment rate from the Ontrak Whole Health plus program. Number two, the omnichannel delivery of GAD7 and PHQ9 assessments was launched in Q3 provided members the option to choose the method of delivery for these assessments, whether it's SMS, e-mail, virtual assistant or during coaching calls in an effort to ensure we are receiving the results in the most timely and efficient way possible that works for each member.

在第三季度，我們看到該外展工作仍在繼續，Ontrak Whole Health plus 計畫的非接觸式退出率降低了 42%。第二，第三季推出了 GAD7 和 PHQ9 評估的全通路交付，會員可以選擇這些評估的交付方式，無論是簡訊、電子郵件、虛擬助理還是在輔導電話期間，以確保我們以最及時、最有效的方式接收對每個成員都有效的結果。

And number three since the launch of our efforts to improve care coach caseloads in the fourth quarter of 2022, driven by adding AI capabilities and operational enhancements for administrative functions. We have now seen a collective 90% improvement in the average quarterly care coach caseloads since the launch in the fourth quarter of 2022.

自 2022 年第四季我們開始努力改善護理教練案件量以來，在增加人工智慧功能和管理職能營運增強的推動下，排名第三。自 2022 年第四季推出以來，我們現在看到平均季度護理教練案例量總體改善了 90%。

All of these positive developments, the new customer and sales momentum, clinical outcomes and technology and operational enhancements reinforce the strength of our strategy, our commitment to our customers and members and the dedication of our employees.

所有這些積極的發展、新客戶和銷售勢頭、臨床成果以及技術和營運的改進都增強了我們策略的力量、我們對客戶和會員的承諾以及我們員工的奉獻精神。

And now I'd like to turn it over to Mary Louise Osborne, who has more details about our new customer and exciting developments in our pipeline narrative. Mary?

現在我想把它交給瑪麗·路易斯·奧斯本，她有更多關於我們的新客戶和我們的管道敘述中令人興奮的發展的詳細信息。瑪麗？

Thanks, Brandon. I'm thrilled to provide more details about our new customer agreement. Our new health plan customer will leverage our entire product suite for its 25,000 Medicaid members. We are waiting on imminent state approval to begin the engagement this quarter with the following Ontrak solutions.

謝謝，布蘭登。我很高興提供有關我們新客戶協議的更多詳細資訊。我們的新健康計劃客戶將為其 25,000 名醫療補助會員利用我們的整個產品套件。我們正在等待即將到來的國家批准，以便在本季度開始使用以下 Ontrak 解決方案。

I will touch on each solution, Ontrak Whole Health plus, which includes the identification of high cost, high acuity members with chronic co-morbidities and underlying, but unaddressed behavioral health conditions. This program includes specialized care coaching and provider treatment for eligible members and delivers improved clinical outcomes and significant cost savings Ontrak Engage, which is our coaching specific solution that identifies members who would benefit from ongoing coaching to help them address physical and behavioral health challenges without a clear need for provider intervention.

我將談到每個解決方案，Ontrak Whole Health plus，其中包括識別患有慢性共病和潛在但未解決的行為健康狀況的高成本、高敏銳度會員。該計劃包括為符合資格的會員提供專門的護理指導和提供者治療，並提供改善的臨床結果和顯著的成本節省Ontrak Engage，這是我們的指導特定解決方案，可識別哪些會員將受益於持續的指導，幫助他們解決身體和行為健康挑戰，而無需任何指導。明確需要提供者介入。

In addition, the Ontrak Engage being available to all adult members. Ontrak health will further outreach to the health plans, most impacted members with serious mental illness to help them address their unique health care needs.

此外，Ontrak Engage 可供所有成年會員使用。 Ontrak health 將進一步向健康計劃延伸，幫助大多數患有嚴重精神疾病的受影響成員滿足其獨特的醫療保健需求。

Ontrak access will provide additional behavioral health providers for Whole Health Plus members with prompt access and availability to care, leveraging our NCQA. certification as a credential�s verification organization.

Ontrak 存取權限將為 Whole Health Plus 會員提供額外的行為健康服務提供者，利用我們的 NCQA 提供及時存取和護理服務。認證作為憑證驗證機構。

Ontrak quality support for the members served jointly collaborating with the health plan on key this measures closing critical gaps in care and improving health outcomes. And finally, the new Ontrack member portal that features specialized and tailored information delivered through our stay ontrak.com website to provide educational and timely content for all the customers, adult members on how to improve their overall well-being.

Ontrak 為會員提供的優質支援與健康計劃共同合作，採取關鍵措施，縮小護理方面的關鍵差距並改善健康結果。最後，新的 Ontrack 會員入口網站提供透過我們的 Stay ontrak.com 網站提供的專業和客製化訊息，為所有客戶和成年會員提供有關如何改善整體福祉的教育和及時內容。

In addition, we are in the final Phase of contracting with three other prospects. I will provide a brief update on each prospect. One, we are completing a statement of work with a prominent value-based provider group that will be leveraging our Ontrak outreach, engage and access solutions for their patients. We're particularly excited about the seamless connection we will be making between their primary care clinics and our care coaches who will provide virtual support and who may also be on-site based in the clinics.

此外，我們正處於與其他三個潛在客戶簽訂合約的最後階段。我將提供每個潛在客戶的簡要最新情況。第一，我們正在與一家著名的基於價值的提供者集團完成一份工作聲明，該集團將利用我們的 Ontrak 外展服務，為其患者提供參與和訪問解決方案。我們對他們的初級保健診所和我們的護理教練之間將建立的無縫連接感到特別興奮，他們將提供虛擬支持，也可能在診所現場工作。

This initial engagement will cover their members in three major metropolitan markets. We anticipate that with successful outcomes. This engagement will lead to an additional opportunity for their 200,000 patients across 15 states. To we are finalizing our proposal for a large health system, Western Medicare Advantage plan and expect to reach agreement later this quarter to serve members with our Whole Health Plus and Ontrak Engage solutions.

此次初步合作將涵蓋三個主要大都市市場的會員。我們預計會取得成功的結果。此次合作將為 15 個州的 20 萬名患者帶來額外的機會。我們正在最終確定大型醫療系統、Western Medicare Advantage 計劃的提案，並預計在本季度晚些時候達成協議，為會員提供我們的 Whole Health Plus 和 Ontrak Engage 解決方案。

We expect this new contract will go into effect in Q1 '2024. With successful outcomes, we expect an opportunity to expand to additional members within Medicare Advantage and other lines of business. And three, we are working on final approvals of our statement of work from a major North Eastern health plan.

我們預計這份新合約將於 2024 年第一季生效。取得成功後，我們期望有機會擴展到 Medicare Advantage 和其他業務領域的更多成員。第三，我們正在努力最終批准東北地區一項主要衛生計畫的工作說明書。

In addition, the health plan is refreshing its data in order to finalize expectations around a pilot for their Medicaid, HARP, and commercial members in Q1 '2024. With successful outcomes, we believe the plans 1 million members will be a future opportunity for the Ontrak Whole Health plus program. In addition, we are in discussions with our existing customers to expand our solutions to additional populations as well as new lines of business.

此外，該健康計劃正在刷新其數據，以便最終確定 2024 年第一季針對醫療補助、HARP 和商業會員的試點的預期。憑藉著成功的成果，我們相信 100 萬會員計畫將成為 Ontrak Whole Health plus 計畫的未來機會。此外，我們正在與現有客戶討論，將我們的解決方案擴展到更多人群以及新的業務領域。

And our pipeline continues to build momentum. We have 27 active prospects, representing 20 million total lives. We are extremely grateful to our existing customers for the partnerships we have developed together serving members in need of behavioral health support and we welcome our new customers with great excitement as we build these relationships serving new populations across multiple business lines.

我們的產品線持續保持強勁勢頭。我們有 27 個活躍的潛在客戶，代表 2000 萬人的總生命。我們非常感謝現有客戶與我們共同建立的合作夥伴關係，為需要行為健康支援的會員提供服務，並且我們非常興奮地歡迎我們的新客戶，因為我們建立了這些關係，為多個業務線的新人群提供服務。

And now I'd like to turn the call over to our Chief Financial Officer, James Park.

現在我想將電話轉給我們的財務長詹姆斯·帕克。

Thanks, Mary Lou, during the third quarter, we recorded revenue of $3.7 million, a 31% year-over-year [decrease] due primarily to a 21% increase in total average annual number through the third quarter of 2023 compared to the same period in 2022 and also represented a sequential increase of revenue of 23% from Q2 of 2023.

謝謝 Mary Lou，第三季我們的營收為 370 萬美元，年比[下降]31%，主要是因為截至 2023 年第三季的年平均總人數比上年同期增長了 21% 2022 年第二季的營收也較2023 年第二季較上季成長23%。

At the beginning of the quarter, we had 1,889 enrolled members and ended with 2,287 at the end of the quarter for a simple average of 2093. That equates to revenue of about $552 per health plan member per month for the quarter, an increase from $528 for health funding of member per month in Q2 of 2023 and an increase of $515 for health plans enrolled member per month in Q3 of 2022.

本季初，我們有1,889 名註冊會員，到本季末有2,287 名註冊會員，簡單平均數為2093 名。這相當於本季度每個健康計劃會員每月的收入約為552 美元，高於528美元2023 年第二季會員每月的健康資金增加，2022 年第三季加入健康計畫的會員每月增加 515 美元。

Regarding our Q3 member metrics, we enrolled a total of 1,272 members during the third for the quarter compared to 1,091 in Q2 this year and 533 in Q3 of 2022 for five consecutive quarters that we have been able to steadily increase our gross enrollments divided Q3 gross enrollment by our outreach pool, we averaged 10, which averaged 10,180 for the quarter, it annualizes to a 50% enrollment rate compared to 43% enrollment rate in Q2 of 2023 and 53% in Q3 of 2022.

關於我們第三季的會員指標，我們在第三季總共註冊了1,272 名會員，而今年第二季為1,091 名，2022 年第三季為533 名，連續五個季度我們能夠穩定增加總註冊人數除以第三季總會員數是根據我們的外展池的入學人數，我們的平均入學人數為10 人，本季平均入學人數為10,180 人，年化入學率為50%，而2023 年第二季度的入學率為43%，2022 年第三季的入學率為53%。

Our average monthly disenrollment rate was 11% in the current quarter, same level of Q3' 2023 and a slight increase from 8% in Q3 of 2022. Further, we graduated 187 enrolled members during the quarter. This equates to about 10% of the new members in the program at the beginning of the quarter. The impact of all this was a net enrollment increase of 408 numbers in the third quarter.

本季我們的平均每月退出率為 11%，與 2023 年第三季的水平相同，比 2022 年第三季的 8% 略有上升。此外，本季我們有 187 名註冊會員畢業。這相當於本季度初該計劃新增成員的 10% 左右。所有這些的影響是第三季入學人數淨增加 408 人。

Our gross margin for the third quarter was 72%, which remained consistent from 72.8% in Q2 of 2023, an increase from 49.5% in third quarter of last year. The increase in our gross margin compared to prior year was primarily due to the continued operational efficiencies in our member facing teams with the utilization of various AI and other systems and process improvements we discussed earlier and in prior quarters. Our coaching capacity has now improved by over 90% from last year when we began to implement these initiatives all while continuing to provide the quality of care, our members and customers expect.

我們第三季的毛利率為 72%，與 2023 年第二季的 72.8% 持平，較去年第三季的 49.5% 有所成長。與前一年相比，我們毛利率的成長主要是由於我們面向會員的團隊利用各種人工智慧和其他系統以及我們之前和前幾季討論的流程改進，持續提高了營運效率。與去年開始實施這些措施時相比，我們的輔導能力現已提高了 90% 以上，同時繼續提供會員和客戶期望的護理品質。

Turning to the balance sheet and cash flow, our cash flow from operations in the third quarter was negative $1.8 million compared to negative $8.3 million in the third quarter of last year and negative $5.1 million in Q2 of 2023.

談到資產負債表和現金流，我們第三季的營運現金流為負 180 萬美元，而去年第三季為負 830 萬美元，2023 年第二季為負 510 萬美元。

This resulted in our average monthly cash burn to be around $1.3 million per month this year so far and $0.6 million per month for the current quarter. We believe our operational efficiency and increasing revenues have approaching positive cash flow in the near future with anticipated revenues from the process that primarily mentioned.

這導致今年迄今我們每月平均現金消耗約 130 萬美元，本季每月平均現金消耗約 60 萬美元。我們相信，我們的營運效率和不斷增加的收入在不久的將來將接近正現金流，並從主要提到的流程中獲得預期收入。

We ended the quarter with cash and cash equivalents of $3.2 million, down from $6.1 million at the end of last quarter, including restricted cash. Total cash was $9.2 million at the end of the quarter, down from $10.1 million at the end of last quarter.

本季末，我們的現金和現金等價物為 320 萬美元，低於上季末的 610 萬美元，其中包括限制性現金。本季末現金總額為 920 萬美元，低於上季末的 1,010 萬美元。

We also just announced the public offering of $6.3 million before offering related fees. In current with our private placement companies, all except $2 million of our Q4 notes into common equity. This provides us with additional capital to execute on our pipeline while significantly reducing our debt obligations and improving our balance sheet.

我們也剛宣佈公開發行 630 萬美元，然後再提供相關費用。目前，我們的私募公司將除 200 萬美元的第四季票據外的所有票據都轉為普通股。這為我們提供了額外的資金來執行我們的管道，同時顯著減少我們的債務並改善我們的資產負債表。

Regarding our outlook, we're reaffirming revenue guidance of $12 million to $14 million for revenues from our current customer base for the year. Now we will open up for questions. Thank you.

關於我們的前景，我們重申今年來自當前客戶群的收入為 1,200 萬至 1,400 萬美元的收入指引。現在我們將開放提問。謝謝。

And thank you. I will now turn the call back over to Brandon LaVerne for closing remarks.

謝謝你。現在我將把電話轉回給布蘭登·拉維恩 (Brandon LaVerne) 作結束語。

Thank you on behalf of the entire Ontrak team, I'd like to thank you for joining with us today and have a great day, and thank you.

我代表整個 Ontrak 團隊感謝您，感謝您今天加入我們並祝您度過愉快的一天，謝謝您。

This concludes today's conference call and thank you for participating. You may now disconnect.

今天的電話會議到此結束，感謝您的參與。您現在可以斷開連線。