TELA Bio Inc (TELA) 2020 Q3 法說會逐字稿

Good afternoon, ladies and gentlemen, and welcome to the TELA Bio Third Quarter 2020 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to Stuart Henderson, Vice President, Corporate Development and Investor Relations for TELA Bio.

Thank you, Victor, and good afternoon, everyone. Earlier today, TELA Bio released financial results for the quarter ended September 30, 2020. A copy of the press release is available on the company's website. Joining me on today's call are Tony Koblish, President and CEO; and Nora Brennan, CFO.

Before we begin, I'd like to remind you that during this conference call, the company will make projections and forward-looking statements regarding future events. We encourage you to review the company's past and future filings with the SEC, including, without limitation, the company's Form 10-K filed on March 30, 2020, and 10-Q filed on August 15, 2020, which identify the specific factors that may cause actual results or events to differ materially from those described in these forward-looking statements. These factors may include, without limitation, statements regarding product development, product potential, the regulatory environment, sales and marketing strategies, capital resources, operating performance or potential impact of COVID-19.

With that, I'll now turn the call over to Tony.

Thanks, Stuart, and good afternoon, everyone. We hope you are safe and healthy. Thank you for joining us today.

Before I review the highlights of our strong third quarter performance, I would like to talk about the past 12 months for TELA Bio. Just over a year ago, TELA Bio became a public company. And while much has changed in the world since that time, the fundamentals of our business are sound and we remain well positioned to drive growth. Our OviTex and OviTex PRS products represent an advancement in soft tissue reconstruction and are designed to improve clinical outcomes and reduce costs of care for hernia repair, abdominal wall reconstruction and plastic and reconstructive surgery. These markets combined represent a $2 billion U.S. potential addressable market opportunity, and we believe TELA Bio is uniquely positioned to lead innovation in these markets through our close collaboration with surgeons, our adaptable technology platform, our organizational flexibility and our focus on advancing our mission of bringing the benefits of natural repair solutions to more patients.

Hernia repair is one of the most common surgeries in the U.S. with an estimated 1.2 million repairs performed annually in the U.S. Hernia repairs range from inguinal hernias on the more simple end of the spectrum to the repair of large, complex ventral hernia defects and abdominal wall reconstruction. Approximately 90% of all hernias are repaired using a reinforcing material or mesh designed to provide long-term support at the repair site. Legacy measures include permanent synthetic meshes, biologic meshes and resorbable synthetic meshes and each have their associated advantages and shortcomings. Synthetic mesh has dominated the market due to its low-cost strength and ease of use and is the primary product used today for inguinal hernia and more simple ventral hernias. However, over the past several years with the introduction of new technologies and risks associated with permanent synthetic mesh, there has been a shift from permanent synthetics to more natural repair materials.

In a recent market survey we conducted, surgeons expect to increase their utilization of natural repair solutions across the range of hernia procedures and exhibit a high degree of awareness of the associated risks with synthetic mesh use. We designed OviTex to take advantage of and catalyze this transition, and we believe OviTex is well positioned to capitalize on these evolving market dynamics.

Another dynamic at play in the hernia market is the increase in robotic-assisted hernia repair surgery. In 2019, over 480,000 general surgeries were performed using a da Vinci surgical robot system, up from approximately 380,000 in 2018. According to Intuitive Surgical, hernia, cholecystectomy and bariatric procedures make up the majority of its general surgeries. Through our market survey, surgeons report using robotic-assisted surgery across the range of hernia repair, with inguinal and simple ventral repair contributing the most procedures. We believe our OviTex LPR is strongly positioned to leverage this ongoing migration from open and laparoscopic approaches to robotic-assisted procedures, and we have experienced strong uptake in this product line in recent quarters as we expanded our product range at the beginning of the year.

Moving to our third quarter financial performance. Total quarterly revenue was $5.3 million, increasing 34% from the same period last year. We experienced solid growth from both our hernia repair and plastic and reconstructive surgery products as procedural volumes improved relative to the second quarter.

While we continue to experience postponements in non-emergent procedures in areas of the country where COVID-19 infections are rising, these postponements were not as drastic as they were in the second quarter, with hospitals and surgery centers having a better understanding of the virus and how to protect their employees and patients. While this improved response is encouraging, we believe there will be variability in the fourth quarter and remain cautiously optimistic even with the number of daily infections continuing to rise and fluctuate. However, we remain cautiously optimistic about our growth.

Our team has done a fantastic job utilizing our TELA LIVE program and other unique solutions to cultivate our strong surgeon pipeline. As a reminder, TELA LIVE comprises of 2 virtual sales solutions designed to educate surgeons about our product portfolio and clinical data. The first is a virtual version of our VIP tours and our second is for KOL seminars. Over 140 surgeons have attended our virtual VIP tours or our KOL webinars through the end of September. Among the surgeons who participated in the event, we have seen close to 125% increase in our product's average monthly revenue. Due to these program success and the positive feedback we have received, we will continue to utilize these strategies for the foreseeable future.

On the clinical front, additional data from our BRAVO trial were presented at this year's Americas Hernia Society Annual Meeting. The first of the data presented demonstrated that ventral hernia repair using OviTex led to a low incidence of surgical site infections and recurrences. Among patients who experienced a surgical site occurrence or surgical site infection at 30 days, none required surgical intervention or implant removal.

Our study consisted of 85 subjects, of which 75% met the criteria for Ventral Hernia Working Group grade 2 or 3. Over 50% of the patients were obese, over 1/3 had undergone a previous ventral hernia repair and 16% had a history of surgical infections. The second group of data presented from the BRAVO study is from the initial 20 patients who reached their 2-year follow-up. Among these patients, no patient experienced a hernia recurrence. While this first group of patients makes up just over 20% of the total number of participants in the study, this is encouraging and continues to support our belief that our reinforced tissue matrix should lower true hernia recurrence rates.

As a reminder, the BRAVO study is a post-market study designed by TELA Bio and its investigators to evaluate postoperative complications and reherniations following the use of OviTex in subjects with moderate to complex ventral hernias. Due to many hospitals limiting nonessential visits because of COVID-19, we are working very closely with our study locations to make sure all follow-up visits and site-monitored data verification can occur in as timely of a manner as practical.

Turning next to our operations. In late June, we began prudently scaling up our sales force in territories where non-emergent procedures are being performed close to pre-COVID-19 levels and where we have hospital access through our existing IDN and GPO contracts. Throughout the third quarter, we continued with our strategic hiring program and ended the quarter with 44 sales territories. These new sales territories are being added within our existing 6 regions. So each region will ultimately consist of approximately 8 territories. We continue to monitor the changing dynamics in elective procedures with our hiring needs, making sure we move forward with our operational growth initiatives while judiciously managing our cash.

While access to our hospital and surgical center customers improved in the third quarter, our supply chain engagement within the hospitals has been challenging with this pandemic. Our team remains in active discussions with supply chain and clinical resources within hospital systems to drive adoption and utilization of our OviTex technology platform. We also continue to make progress on securing additional IDN and GPO contracts.

Lastly, we believe our OviTex PRS product's commercial rollout for the plastic and reconstructive surgery market is beginning to take hold. Our clinical team has done an excellent job of reaching out to and communicating with surgeons through our TELA LIVE program. Many of our surgeon customers are new to the OviTex PRS, and are currently evaluating the product through their natural adoption process, trying the product on a select group of patients and waiting several months to determine its clinical performance before using the product on additional patients. Our clinical and clinical development teams support these surgeons through their experience and continue to educate additional surgeons on the compelling value proposition of OviTex PRS in its use in plastic and reconstructive surgery.

I'll now turn the call over to Nora.

Thanks, Tony, and hello, everyone. Please refer to our press release issued earlier today for a summary of our financial results in the third quarter of 2020. Revenue for the third quarter increased 34% year-over-year to $5.3 million. Total revenue increased over the prior year period, elective procedures are still being impacted by the rise in COVID-19 cases. Gross profit as a percentage of revenue in the third quarter was 62%, which was lower compared to the prior year period, primarily due to a charge for excess and obsolete inventory in our latest quarter. Sales and marketing expenses were $6.3 million in the third quarter of 2020 compared to $4.7 million in the same period in 2019. The increase was primarily due to higher salaries, benefits and commission costs as a result of an expansion of our commercialization activities, including an increase in headcount which was partially offset by lower travel and consultant expenses resulting from the effect of the COVID-19 pandemic.

G&A expenses were $2.6 million in the third quarter of 2020 compared to $1.2 million in the same period in 2019. The increase was primarily due to higher costs associated with being a public company, including compensation, benefits and stock-based compensation expense. R&D expenses were $1.2 million in the third quarter of 2020 compared to $0.5 million in the same period in 2019. This increase was due to higher salaries and increased outside development costs.

Loss from operations was $6.9 million in the third quarter of 2020 compared to $3.9 million in the prior year period. We ended the third quarter of 2020 with $81.5 million in cash and cash equivalents, which is a decrease of $4 million from last quarter. The net loss was offset by some improvements in working capital this quarter due to the ongoing process improvements in inventory management and demand planning. Based on our current plans, we believe that our existing cash resources will be sufficient to meet our capital requirements and fund our operations for the long term.

Now turning to 2020 guidance. Due to the continued uncertainty from the impact of COVID-19 on our business, we will continue with the suspension of our full year 2020 guidance.

And with that, I'll turn the call now over to Tony.

Thanks. In closing, I want to thank everyone again for your time this afternoon and for your interest in TELA Bio. I would also like to thank our team at TELA Bio for their commitment and dedication through these challenging times. Because of their hard work and perseverance, I'm confident we will continue our success and achieve sustainable growth in the long term.

I'll now turn the call back over to Victor and open it up for questions.

(Operator Instructions) And our first question (inaudible).

(technical difficulty)

I think that's me, Raj Denhoy. It broke up a little bit there, but hope you guys can hear me okay.

Yes, Raj.

Yes. Hello? I want to ask a little bit about the sales adds in the quarter. If I think I heard you correctly, Stuart -- sorry, Tony, I think you said you're at 44 reps now. I think it was 36 last quarter. So I wonder if you can confirm that. And I guess, that pace of hiring seems like it's picked up a little bit. Should we expect you're going to continue to add people here into the fourth quarter?

Yes. Let me just clarify, Raj. So we've got 44 territories carved out and set up based on all the criteria that we use, right, where the talent is, where the IDN, GPO access is. We only have about 40 reps, maybe 42 reps plugged in to those 44 territories, right? So we're a little bit low compared to the territories by a couple of reps. So we're really in the low 40s right now. Our target is to continue sort of the strategic, thoughtful recruitment of reps until we get to about 48 reps. That should happen at some point next year. I mean we're -- right now, we're sort of feeling pretty good about the team we have, the productivity, the TELA LIVE being a good jump-off point to get the reps primed and started. And we're starting to really figure out how to make use of our clinical development specialists and business managers that support them in the field.

So I think 48 feels like the right number of reps for us at some point early next year. And then we're just going to focus on productivity and driving that group. And then we'll see where it goes, right? It will allow us to monitor how COVID is going, how we're feeling about supply chain access, and we will remain vigilant and will retain the right to hire faster or sort of hold based on what we're seeing. But either way, we're going to drive this thing with growth, either doing more with the current footprint or doing more with the current footprint and adding to the footprint.

Right. That makes sense. But it does sound like you did add people though.

Yes.

If I'm not mistaken, it was 36...

Oh, absolutely.

At the end of last quarter, right? So you did add even if you got to 40, 42.

Yes. I think you're right on the money. Yes. Yes, that's right, Raj. Perfect.

Okay. And I appreciate you don't want to give us much in the fourth quarter, but I'm just curious, last quarter, I believe you gave us a little bit in terms of the kind of monthly progression in terms of the quarter.

Yes.

How are things shaking out? I mean are you seeing any sort of softness now that the case volumes are increasing? I realize it's short term and not really germane to kind of the long-term growth story but just so we can calibrate kind of the near-term expectations.

Yes. That's an interesting question that we're trying to figure out ourselves. If you look at Q3, coming off of a highly anomalous quarter in Q2, Q3 seems to have snapped back to a more normal cadence, right, on a month-by-month basis. The biggest contribution to the quarter is in the last month of the quarter, September, which historically has been about 40% to 45% of that quarterly revenue. And that exactly was the case in Q3. So it's interesting that we had sort of a normalized cadence per month. We had a normalized set of procedures. It felt very normalized other than the ups and downs that we've seen regionally in the market due to COVID, the patchiness.

In Q4, we're dealing with a whole different ball game, right? Hopefully, we see similar normality in terms of performance. And certainly, October, our first month in the quarter was hitting the mark well. But I've never been through a COVID situation in the middle of holidays, Thanksgiving and Christmas. If you look historically at our business, even though we were immature the last couple of years, our best months of the year tend to be that October, November, December, somewhere in that ballpark are our best months.

So I believe we should be able to keep that up, but we do see this patchwork effect that's constantly shifting. And right now, it feels like it's the Midwest, particularly the upper Midwest where we're seeing some impact. But like I've said before, I think we're nimble, we're agile, we're mobile. We can figure out how to keep this thing growing. But Q4 is going to be a little strange with the holidays baked into this as well. But so far, so good, Raj.

Understood. And maybe just lastly, just in terms of access, right? So anything you want to offer? I mean any new GPO contracts or anything that might be pending that we could hear about anytime soon?

Yes. So the big GPO -- there's not many big GPO players, right? We've got the big one in hand, as you know, HealthTrust. And there's a couple of others that we're going to work on when the time comes. They're not ready yet in terms of the process. So we're grinding away at the IDNs, and it's working. If you look at the performance and contribution of what we're doing here, we're up within the HealthTrust accounts.

I think in Q3, we had somewhere between 80 and 85 accounts. And if you compare a year ago, HealthTrust, we were down in the 40s. So even though we went sideways a little bit in Q2 due to COVID, we're making traction. And right now, all the HealthTrust accounts are looking like about 35% of our business, up well over 10% year-over-year. So even though it's been difficult getting traction in supply chain, we've seen a good improvement. And then 50% of our business is from -- not 50%, but the rest of the business is from IDNs. And if you look at our IDN contracts, Raj, that we're knocking down sort of piecemeal, they're all contributors to those final big GPOs, which we still have to work on getting. So right now, the plan is execute against HealthTrust the best we can and knock down all the IDNs that ladder up to Vizient and Premier and those guys. And that's exactly what's happening right now.

Yes. And just to finish that Raj, a little bit extra color. About 50% of our top 20 IDNs do ladder up to those national contract GPOs. So I feel like we're getting there, across all the different systems that are out there, by hook or by crook.

Your next question comes from the line of Matthew O'Brien from Piper Sandler.

Just so the operator knows, he's breaking up every time he's...

Yes. I can hear you.

We can hear you, Matt.

Yes. I guess just to follow-up on Raj's last question on supply chain access at the hospitals. Can you elaborate a little bit more as far as what the challenges are that just you can't get in to see these folks, you can't really sell the merits of OviTex? Or is there something else that we should be aware of?

It's not that complicated, right, it's availability and distraction. It's just not ideal, it's not impossible. As you can see, we're executing, but it's not ideal, right? So we've seen the employees either working from home, furloughed, in some cases, what have you but they come back, just like we have the TELA LIVE program for presenting to and engaging deeply with surgeons which is working.

We also have our B2B program which predates COVID, which is becoming super, super important. And that allows us to use a team of logistics and customer service folks to engage with the supply chain people if the reps can't get into the hospital. So, we're seeing some situations where nonessential personnel just to do administrative stuff. Reps particularly aren't encouraged to be in the hospital. If they've got to be there for a clinical reason, that's a different story.

So we're employing our B2B program, which is mostly virtual: by e-mail, by Zoom calls, by all the usual tools. So it's working, but it's a bit more frictional for us, I would say. It's not ideal. I think in -- Matt, in principle, if you are a large incumbent, it's easier, right, to deal with sort of a fractured employee base across supply chain. If you are a newcomer, it just takes a little bit more time, a little bit more friction and you just got to be relentless and persistent and flexible, which we are. It's working, but it's a little tougher.

And that does have some impact on our product range, right? I mean we can -- we're more established on the hernia side. So our LIVE programs are able to drive deeper penetration and more usage where we have access and where we are. Whereas on the PRS side, we're still establishing ourselves. We're newer on that product range. So that probably has a little bit of a bigger impact on PRS, although we're doing well with PRS than it does on hernia. But I think this concept of incumbent versus newcomer, probably we have a little more friction to go through, Matt.

Okay. And this may be an unanswerable question, but is there a way to kind of quantify what that may be? Is it costing you 10% of revenues in the quarter or something like that?

Yes. I don't know. It's costing us. I think it's hard to quantify that. I mean I have -- I feel frustration, right, because I feel like I see what's working. And it is working, right? The new reps that we've hired in 2020 are 20%, 20-plus percent of revenue, right? So they're getting -- that's what we want to see. We want to see these reps get productive more quickly. The LIVE programs, we can see it working, right? We've got 160 surgeons that we've run through the LIVE programs, and their productivity on a monthly basis is up 125%.

So you think what could we be doing? If everything was normalized and we were in a normal situation, I'm going to say it's more, right? But we're having good success. I told our team, and I'll say this to everyone, our job is to grow and establish the company no matter what the situation is out there in the market and in the playing field, and we're doing that. And if we just have that mindset, when we'll just continue to do better and better as the frictional forces ease off and COVID becomes past memory. So yes, we could be doing more. We don't know exactly how much more. It's not possible. But I feel like we could be, for sure.

Okay. Well, I mean, I guess it's good to see that you beat numbers so handily in Q3 even if you just had...

Yes. Easy for me to say.

Yes. Right. Right.

Yes.

So I guess, Tony, is there -- it seems like TELA LIVE is probably slowing down just given that these doctors are back to work and pretty busy. You still got some of these headwinds as far as COVID kicking, increasing. And so getting access on the hospital side is going to be more challenging. Is there going to be -- and it's probably going to be more transient than anything, but just a hole in your ability to really grow the business as you kind of adjust to this environment? Or is there just so much momentum that you don't think that will be the case?

No. I don't think so. I think we can get these TELA LIVE programs moving. Our cadence has slowed down a little, but not that much. We're still doing them. We're still interacting. There's plenty of interest. There's a need out there for new products, new technologies and then a particular need within the hospitals for cost savings. So we have the right product at the right time for so many different reasons.

And we mentioned this, we did this survey to take a look at perceptions. And fully 60% of the surgeons are cognizant of problems with plastic mesh, and that's our opportunity, right? And 20% of the patients that are coming in are cognizant of the risks associated with just straight up permanent plastic mesh. So we're in the early stages of natural repair being pretty attractive. And when we're on these LIVE programs, it's really a benefit that we can have the senior leadership team, including myself, interacting with these surgeons. And it serves as market research and understanding as we go forward.

And I could say that we have the ability to present much more aggressively about the downsides of permanent plastic and the upsides of natural repair than we have in the past. So there's so many confounding puts and calls and ups and downs in this. I think we -- I think the upside of the LIVE programs and the direct contact with the surgeons, they don't have to get on a plane. They can spend 30 minutes with us, bang, I think we can continue to move forward with that. And don't forget, we're still penetrating in the LPR into the robotic procedures. And certainly, PRS is going to be a great growth driver for us as we go forward. So there's a lot of good tools and factors that we have that are coming together that should be able to overcome all the chop, and that's what we're playing for.

Our next question will come from the line of Kyle Rose from Canaccord.

Can you hear me all right?

Yes.

Yes.

So I wanted to just run down a couple of questions here. You talked about the robotics and the LPR at the beginning. Obviously, that's a positive. But maybe can you help us understand, how does that -- how is the use maybe in the more simple hernias from a robotics perspective translating to more use in simple hernias broadly? Just trying to understand how much of the overall hernia repair market that you think you realistically have access to now versus in the future? And then if you could also, from a high level, just break down OviTex versus PRS from a revenue perspective, that would be very helpful.

All right. Let's start with the last question first. So on a unit basis, we're still running about 90-10 hernia versus PRS. It's a little different on the revenue side, but we'll -- it's a little higher in favor of PRS given that ASP is a bit higher. But we're going to report it out that way going forward. And I will say that PRS is going to grow, right? It's going to -- the traction is going to come. We're sort of in that early show me kind of adoption profile that we know so well and have been through with our other products.

I think our portfolio right now on the hernia side, Kyle, has never been better positioned to be able to do anything and everything in the hernia market, satisfy every type of surgeon preference, every type of patient need and every type of technique, both open and minimally invasive. Our ventral hernia repair is running about 60% to 65% of the hernia procedures. But between inguinal and hiatal, those are growing for us. And somewhere between -- it looks like 35% or so are split between those inguinal and hiatal procedures. A lot of those procedures on the inguinal and hiatal side are robotic. And I think a lot of the simple ventrals are starting to turn robotics. So I think as a simple proxy, Kyle, whenever you hear about OviTex being used in a robotic procedure, you're probably talking about us displacing a permanent synthetic mesh more often than not, right? That's primarily the type of product that gets used with the robot just for ease of use. It's very hard to use other natural repair products with the robot other than what we have going on.

So that robotic procedure is a proxy for synthetic replacement, and we're quite pleased with the growth of LPR. It's really coming on. And if you look at our Q3 statistics, we're running about 50% -- a little over 50% being open procedures and the rest being split between robotic and laparoscopic, with the bulk of those 30% plus, 35% being robotic. So we have a very robust usage across our platform of natural repair with robotic, and I think it's fair to say most of those procedures would have been plastic permanent mesh. Does that answer the question?

It absolutely does. That's very helpful. So I appreciate the additional color there. I just wanted to ask one more specifically about PRS. Maybe just help us understand what some of the feedback is from the early adopters or we'll call it the dabblers here thus far? Are they trying to add 1 or 2 cases and then watching results happen? And then just the overall status or the health of the breast reconstruction market as it stands now. We've heard from some of the -- I mean more of the implant companies that the recon market is lagging from a recovery standpoint relative to the augmentation market. Is that kind of what you're seeing when you're talking to your customers? Do you think there's more pent-up demand that could potentially come into the market and kind of people are more comfortable?

Yes. No, we're so small as a percent basis that we're just still working our way through this early adoption phase. So the fact that it lags augmentation really doesn't mean much to us at this point. We're still working surgeon by surgeon methodically through the process. I think the feedback with the product is, it's interesting. It's a unique product, the different type of stretch. And the fact that it offers great support and control, I think, is very attractive. Certainly, the price point and ease of use, also very attractive. I think that's really where we are right now in terms of the early experience.

I think we have a wide mix of physicians. From the early stages of the limited rollout, we probably came out of that with 7 to 10 pretty robust users. And we're starting to increase that number. And the new users are -- span the range between guys that do a few to guys that will jump in and do 10 or 15 or 20 even and then monitor their results as they go forward. So we're right where we should be in terms of everyone gaining confidence in our plastic and reconstruction program. The next few, the next -- we'll see growth -- yes, we'll see growth over the next few quarters. We had and this makes sense, right? We had our best units and dollars with PRS in Q3. So it's growing. Slow but steady. That's the mantra, slow but steady.

(Operator Instructions) Our next question will come from the line of Dave Turkaly from JMP Securities.

I'm wondering, Tony, if you might comment a little bit on the pricing strategy, how you think that's working overall? And then any sort of commentary on ASPs in this current environment? Love to hear any thoughts there.

Yes. I mean our ASPs have been fairly consistent. I would say, over the last couple of years, we probably have a little bit of a tick up in the discounting as the percent of HealthTrust grows and grows. But nothing outside of too crazy in terms of magnitude. So I think we priced our product range right. We priced it to be a very good value proposition, particularly with our high-performance clinical data. And it's not requiring a whole ton of discounting. We have a wide array of pricing within the portfolio itself, Dave, right? So we can pick our lowest technology level and our highest technology level and there's different ASP for all of those.

On a blended basis, I think the ASP has been a fairly consistent steward over the last year or so, in the say $3,000 range or so. And I think we priced it right. We feel pretty good about the value proposition that we can provide to the hospitals. The LPR product is priced a little bit lower to encourage those high-volume usage in replacing the plastic, but not ridiculously, not too much lower. So we have some flexibility. I think we have different technology levels, and we have ASPs that seem to be hitting the sweet spot.

Great. And I know you talked a little bit about in the past about $1 million territories and maybe a handful, maybe slightly more than that, that you had. You have some adds this quarter. I guess as we look at the 44, I mean, is that a target for them all? I mean the ads that you made, are they in big areas, like, I guess, thoughts on where those can go?

Yes. I mean that's the standard, right? I mean every rep's got to pull $1 million on an annualized basis. Before COVID happens, gosh, what were we running?

Running 10.

We were running about 10 reps that were $1 million reps and we had a handful that were $2 million reps. So I think there's proof there that we can do it. What's interesting is not all of our pre-COVID top performers have gotten back, which tells you some have and some haven't, which speaks to the nature of the patchiness. But we've added $1 million rep run rates with new reps hired in this year. I think 20% or so of our revenue right now is coming from reps that were brought on in 2020. So that speaks to the power and success of the LIVE program, the virtual B2B stuff that we're doing because they don't have perfect access and a free and easy playing field at the hospital, at the street level. But they're growing. They appear to be maybe 2 or 3 quarters ahead of where our historical guys were. And that makes perfect sense, Dave, because we've got better access, we got better data. Everything is starting to click and come together here, so we should be able to drive that productivity. And so far, in 2020, we're doing it. So bringing on reps are very attainable, very, very attainable with this product set.

(Operator Instructions) And I'm not showing any questions at this time. I'd like to turn the call back over to Tony for any closing remarks.

All right. Thank you, Victor. So thank you, everybody, for catching us on the call today. We really appreciate you following us. Business is strong, feels good. I wish we had a free and clear market. But we're going to get our piece with whatever the market gives us. So we look forward to meeting you next time, and thanks a lot. Good night.

Ladies and gentlemen, this concludes today's conference call. Thank you for joining. You may now disconnect.