Good afternoon. Now I'll turn the call over to Amy Raskopf, Evofem Biosciences Vice President of Investor Relations. Please go ahead.
Thank you, Mary. Good afternoon, everyone, and welcome to the Evofem Biosciences results call for the second quarter of 2022. If you haven't done so already, I encourage you to access the presentation that accompanies this call and the press release we issued after market, both of which may be found at evofem.com under the Investors tab. Before we begin, I would like to remind you that remarks on this call will contain forward-looking statements, which are made only as of today, August 4, 2022. For a more detailed description of important risk factors that could cause our actual results to differ materially, please refer to our annual report on Form 10-K and our most recently filed 10-Q.
Also, we will discuss estimates and other statistical data made by independent parties and by the company relating to the market size and growth and other data about our industry. This data involves a number of assumptions and limitations, and you're cautioned not to give undue weight to such estimates. With that, I'll turn the call over to Evofem CEO, Saundra Pelletier.
Thank you, Amy, and thank you to everyone for joining us today. Today, we are reporting another strong quarter of improved operating results, highlighted by a 42% increase in Phexxi net product sales. We reduced our total operating expenses by 8%. We narrowed our loss from operations by 16%, and we expect further growth in Q3 and beyond, driven by ongoing penetration of the $7.9 billion U.S. contraceptive market. For those of you that are new to Evofem, and as an important reminder, our innovative non-hormonal contraceptive product, Phexxi, is the first and the only FDA-approved woman-controlled product that does not impact a woman's ovaries in any way, nor does it prevent implantation of a fertilized egg. With the growing awareness of Phexxi and the concerns among women about sustainable access to contraception, Evofem is poised to capitalize on the current environment.
With that, I will ask our CFO, Jay File, to review the financial results. Jay.
Thank you, Saundra. Today, I'm going to focus on the second quarter of 2022 results relative to the first quarter of 2022. Net product sales increased 42% to $6 million, driven by higher ex-factory sales. Our gross to net was 40% for the second quarter of 2022, and we continue to expect GTN will remain about this level or better. Total operating expenses decreased 8% to $30.5 million. This was mainly driven by lower R&D costs, which were $7.7 million in Q2. The decrease reflects lower costs of the phase III EVOGUARD trial as participants completed and exited the study. We expect R&D costs to come down in the third quarter since the last patient visit was completed in late July. R&D costs should be significantly lower in Q4 and beyond.
Selling and marketing costs were $400,000 lower in Q2, while G&A costs were up $100,000 due to legal fees. As a result of the higher revenue and lower operating expenses, our loss from operations improved 16% to $24.4 million. We continue to expect 2022 net product sales will be in the range of $30 million-$35 million, with momentum building in the second half of the year. This represents 264%-325% growth year-over-year. We expect gross to net will be 40% or better, trending lower in the second half of the year. We remain on track to reduce costs by $50 million in 2022. Our total operating expenses were $25.3 million lower in the first half of the year versus the same period of 2021.
Finally, we still expect to be cash flow breakeven on a quarterly basis no later than the end of 2023. During the second quarter, we raised net proceeds of $18.1 million from an underwritten public offering and $2 million from our equity line of credit, which we terminated in May. Through August 3, 2022, we received $22.4 million from the exercise of common warrants that were issued in the May public offering. At the close of Q2, we had $19.9 million in unrestricted cash and $1.6 million in restricted cash. Based on our current expected operations, we believe we have sufficient cash to fund operations into Q4. This does not include potential non-dilutive capital from commercial alternatives we are exploring and evaluating to enhance shareholder value, like U.S. co-marketing and co-promotion partnerships.
We continue our efforts to regain compliance with the Nasdaq Capital Market minimum bid requirement. In May, we closed above $1 for 10 consecutive trading days as required by the Nasdaq Listing Panel. However, the panel took the unexpected step of disregarding Evofem's achievement of this compliance milestone. Ultimately, the panel granted our request for continued listing of our shares on the Nasdaq Capital Market without requiring a second reverse stock split, provided the company is able to evidence a closing bid price of at least $1 per share for at least 10 consecutive trading days by August 22nd. Given our solid Q2 results, we hope for strong support from investors who see our ongoing growth in the $7.9 billion contraceptive market and the upside opportunity in STI prevention and believe Evofem is a smart investment, especially at the current share price.
With that, I'll turn it back over to Saundra.
Building on what Jay said, since April first, we have announced 16 positive developments that will all favorably impact our go-forward business and enhance our ability to deliver long-term shareholder value. We have presented and published four new data sets on Phexxi to the medical community. The most important of these was data demonstrating that Phexxi prevented 99% of pregnancies per act of sex in the phase III AMPOWER clinical trial, which is resonating with healthcare providers and women alike. This should increase uptake, translating into prescription growth. As an organization, we proactively developed and launched a new educational birth control chart covering all available methods to assist providers in patient contraceptive counseling. It replaces a far outdated chart many OBGYNs still had on their walls, which was developed before new contraceptive methods like Phexxi came to the market. It assists healthcare providers to deliver patient-centered care.
Better and more informed counseling should increase utilization, translating to prescription growth of Phexxi. Media coverage of Evofem and Phexxi spiked dramatically since June, including features in People Magazine, NBC News, CNN, and more. We partnered with A360 Media, placing Phexxi branded content in their widely read entertainment and lifestyle magazines on every shelf, as well as online media. We forged a Phexxi manufacturing partnership that's expected to decrease our cost of goods up to 45%. The FDA extended Phexxi shelf life to four years. A new patent was allowed covering Phexxi's composition of matter and providing protection through at least 2033, and we also strengthened our leadership team and our board of directors. We continue to secure coverage for Phexxi with payers.
Our largest win is a long-term contract with one of the largest PBMs in the nation that added Phexxi to its national template formulary with no restrictions. This is significant, and we look forward to increased Phexxi prescriptions among this PBM's 28 million participants. This agreement is also expected to save us upwards of $1 million a year by removing prior authorizations from Phexxi prescriptions for this PBM. Each prior authorization was costing us $35 to process, and we're delighted to remove this cost from our operating expense. Our approved claim rate has continued to increase through 2022, and currently, more than 70% of Phexxi prescription claims are being approved. Every new agreement means more women are able to fill and refill their Phexxi prescriptions, and we look forward to the positive impact this will have on Phexxi growth.
The biggest catalyst that the market responded to was the Supreme Court ruling on Roe v. Wade on June 24th. The media focus on contraception in the wake of this decision provided a tailwind to Evofem by increasing visibility among investors as well as consumers. This has created a tremendous opportunity for our company. Many of you who are new to the stock since that date, I want to welcome those of you. For those of you that have been with us for a while, I want to thank you for your continued support as we build on these accomplishments. Q2 was another consecutive quarter of increasing net product sales and improved operating loss. We are consistently delivering growth quarter over quarter. This directly reflects the heightened recognition of Phexxi's innovative attributes among women and prescribers and growing traction with insurers.
We expect another strong quarter in Q3 based on the current trends and the indicators. As Jay mentioned, we remain on track to achieve our 2022 revenue guidance of $30 million-$35 million. Last week, following President Biden's executive order on ensuring access to reproductive health care, the U.S. Departments of Health and Human Services, Labor, and the Treasury released guidance clarifying that group health plans and insurers must cover contraceptives at no cost to individuals. The ACA guarantees coverage of women's preventive services, including free birth control and contraceptive counseling for all individuals and covered dependents with reproductive capacity. This encompasses all contraceptives like Phexxi that are approved, granted or cleared by the FDA. What does this mean for Evofem? It means more plans covering Phexxi at no cost to women, and it means them doing that sooner with no restrictions.
It means less money that goes to co-pay programs. That increases our profitability of every Phexxi prescription. Evofem's market access team is having renewed discussions with insurers and PBMs that were previously non-compliant with these guidelines to advance the removal of impermissible barriers such as step edits, claim denials, and prior authorization letters to ensure that women have access to Phexxi at no out-of-pocket cost. As a reminder, there are 42.2 million potential Phexxi users in the United States. The total contraceptive market is estimated to be $7.9 billion. Every 1% market share of the 42.4 million women in our addressable market represents significant net product sales for Evofem. Those of you who are looking at this slide, it is one of my favorite.
At our current WAC of $294 per box of 12 Phexxi applicators, applying the Q2 gross-to-net of 40%, we net $176.40 per box. If we're being conservative and women only get four boxes of Phexxi per year, each 1% market share equals $298 million in Phexxi sales. However, the reality is that most providers write a six-month prescription. When women get six boxes of Phexxi per year, each 1% market share equals $447 million in Phexxi net sales. When our gross-to-net improves to 35%, the economics are even more favorable, and we also know a number of women are getting far beyond six-month prescription. Contraception is a profitable business, period.
Especially, though, for a company with an FDA-approved proprietary product with no generic competition or equivalent. Moving on to the program that we expect to double our market opportunity, providing significant upside for shareholders and women, is our EVOGUARD study. Because every sexually active woman is at risk for STI infection. On Monday of this week, we announced the last patient visit in our registrational phase III clinical trial evaluating Phexxi for the prevention of chlamydia and gonorrhea in women. Success in STI prevention would expand our market opportunity beyond women in their reproductive years. Research has indicated that two-thirds of current lubricant users would replace their lubricant with Phexxi if approved for the prevention of chlamydia and gonorrhea. An additional study found that 49 million Americans used personal lubricants in 2022.
20% of people in the United States had an STI on any given day in 2018. The CDC estimates 4 million and 1.6 million new cases of chlamydia and gonorrhea, respectively, and all of those occurred last year. Infected people are often unaware of and don't seek treatment for their infections. Chlamydia is the most frequently reported bacterial infection in the U.S. Almost 60% of women infected with chlamydia have no symptoms, yet it's one of the leading causes of infertility in the U.S., which we know is emotionally and financially daunting. There are no FDA-approved women-controlled prophylactics to prevent these STIs. The CDC states that all sexually active people are at risk. The need here is enormous. Regardless of the contraceptive product women are choosing, they are still at risk. This widens the market opportunity for shareholders and women significantly.
We're on track to report our top-line phase III study data in October. We expect positive outcomes would enable us to submit regulatory applications to the FDA in the first half of 2023. These will be sNDA filings seeking to add prevention of chlamydia and gonorrhea in women to Phexxi's label. We have fast track designation for both potential new indications, so we could receive FDA approval for these indications in 2023. I'd like to point out that we believe our current valuation does not reflect the opportunity we are addressing with Phexxi in the $7.9 billion U.S. contraceptive market. It does not factor in the near-term upside potential in STI prevention. We believe this presents an incredible opportunity for the right investor, and we hope that we can count on your support. With that, operator, please open the call to questions.
Sure. Ladies and gentlemen, if you'd like to ask a question, please press star one. Again, to ask a question, please press star one. One moment while we wait for questions. We do have a question coming in now. This first one is from David Amsellem, Piper Sandler.
Hi, David. David, are you muted? We can't hear you.
Maybe your line is muted or something.
Hey, can you hear me now?
Yeah, I can hear you. We can hear you.
Yeah, we can hear you now.
Okay. My apologies. I was on mute. So I joined late, but I you know, so you may have adjusted, Saundra, but you know, the first question I had is you know, since the overturning of Roe v. Wade, what are you hearing in the field in terms of just level of interest and you know, not just from you know, practitioners, but also from patients? That's number one. Then number two, different question. This is on the you know, the gross-to-net, which you know, I feel like I always ask, but I need to.
That is, you know, with the contracting and, you know, with the environment being what it is, you know, for the better, of course, how should we think about steady state beyond this year? Thanks.
Thank you for the question. I will start, and then I'll have Jay talk about gross-to-net. Here's what we're hearing in the field. I mean, as you would expect, there is a heightened sense of urgency since the Supreme Court decision on abortion. We are hearing more and more interest from healthcare providers in wanting to meet with our sales team and wanting to know and understand the entire offerings that Evofem has. We also are actually having a lot of HCPs, depending on their state, talking about what might end up being less choices that they will have available to offer to women.
Rolling out this educational birth control chart, and I don't know if you were on at that point, David, but one of the things that's happened for more than 10 years, there has been no update to this patient counseling chart. You know, when you're in a waiting room and you're, you know, frankly nude from the waist down, waiting for your doctor to come in, and you're, you know, staring at the wall or the ceiling. Oftentimes, you know, these charts really show women what are their choices, what is the myriad of choices, and what choice is best for them. We took proactively upon ourselves. In fact, our Chief Commercial Officer was in the field and repeatedly saying that, "Look, these are outdated charts.
Oh, if anybody wants to counsel a woman, they're so busy in their day, isn't it better? The charts have been effective. As an example, we have reps calling in and saying that they brought in one or two charts. We have offices calling us constantly saying, "We have eight exam rooms. We need at least eight charts." We're hearing that counseling women has become much more pervasive than before. We really weren't, you know. Of course, some doctors counsel patients, but now even the ones that weren't counseling as much are counseling more because women are nervous, and they wanna know about sustainable access. We've heard a lot of people coming in saying they're worried about maybe what they're using might not be available, and should they start to switch to something else.
One of the biggest things that we have heard is that as physicians understand that our product does not do anything to negatively impact a woman's ovaries, there has been an interesting focus. The doctors who are writing Phexxi perhaps for breastfeeding women or for cancer patients or for women who just can't use hormones are now expanding their mind to say, "You know what? I need to broaden who I think the Phexxi woman is." The biggest lever for that was this analysis we did that showed that based on acts of sex, that 99% of the time, Phexxi prevented pregnancy. I would say that for us, it is bittersweet. I mean, you know, come on, I run a women's healthcare company. Obviously, the SCOTUS decision was tough. We expected it, though.
I would tell you that the increase in interest for Phexxi has been very significant. That's what we're hearing. The final thing I would say is that we are hearing, though, a lot of trepidation depending on where the states are, where some of these representatives are, where people are starting to brace themselves. You know, they're hoping that it doesn't go further than just the decision on abortion, but people are already starting to, you know, brace themselves and be skeptical about what might be next. You wanna talk about GTN?
Sure. How's it going, David? To follow up on your GTN question, still always valid, so keep on asking it. You know, we were very pleased obviously to see GTN maintain its consistency as we believed it would at the end of Q1 in that 40% range. We are reaffirming guidance that we do anticipate that continuing through the end of the year and a very strong possibility to see it lower as the year goes on. That is largely attributable to not only the new PBM contract, but some of the other wins that you saw reported on some of our press releases, obviously during the quarter, and then we had summarized here. Why those are important is because you start seeing them come through with less utilization of our co-pay programs.
Why that is so significant is of that 40%, a little less than half of that is attributable to our co-pay programs. So anytime you can obviously start chipping away at that's gonna have a direct benefit to our net revenue number on every sale of Phexxi as it goes forward. Now, there's always gonna be costs associated with distributor, and other administrative costs that flow through. Those are never gonna go away. We, you know, with volume increases, you know, in the next few years, we do anticipate we could probably negotiate down some distributor costs. But in lieu of that, we do know that ultimately, you know, a good 20%-25% is probably here to stay for the time being as a cost of doing business.
We do think that ultimately over the next few years, we can get down to 35%, and 30% is a reality at some point in the near future. Then some of it, and you know, I do expect us to give updated guidance at the time next year when we see full ACA mandate coming through, and we get a little bit of headwind and actuals coming through and see just how significant that impact is. We'll always have public, private mix. We'll always have plans that are exempt from ACA. That's always gonna be there, but we don't think those will have a negative impact on GTN, and we do see continued improvement as we move forward.
Does that address your questions, David?
All right. We do have another question coming in from Yale Jen, Laidlaw & Company.
Okay.
Good afternoon and thanks for taking the questions. The first question is that it's certainly a great quarter last quarter. Are you guys gonna review some of the script numbers in the last quarter? Then I have a follow-up question.
Well, here's what we can tell you. We can tell you that, we have had, you know, quarter over quarter, we have seen an 11% and 12% growth. We've seen an increase. You know, one of the things that we have done as we shared on the call is, for example, when we rolled out the A360 Media rollout, it drove a 16% spike in demand just after the initial two weeks. What we have been seeing is that we are seeing growth. We've actually seen a lot of people and distributors and wholesalers getting ready for the rollout that just happened. We did a whole series of interviews with Annie Murphy that's gotten a lot of media attention. There's a lot more media rollout to come as a result of those interviews.
Particularly also July first was the day that this largest PBM came on board with no restrictions. We really feel like, you know, we're actually now not just continuing growth, but you'll see, I think, much more growth and momentum, you know, as time goes on over the next few weeks.
Okay, great. That's very helpful. One more question here is that the third quarter is already roughly a month and two days, and you anticipate, and you've probably seen that the revenue growth are increasing. Any colors you can sort of share for this brief month outcomes or any kind of trends you can indicate?
I'll take that.
Okay. Okay.
Yeah, yeah, I won't give you too much insight, obviously, just not tonight to give too much guidance going forward in the details. But, you know, to kind of reiterate the guidance we gave, obviously $30-$35, we are still firmly holding on to this for guidance for the year. That means some sequential growth quarter-over-quarter, obviously, as it gets there. Second half of the year, we always knew that was going to be the stronger half of our year, just building on the first half. Things are falling into place very nicely as far as getting this large PBM win and having ACA mandate coming on. Both of those, we believe are gonna be strong tailwinds heading into the second half of the year.
I would look to see some good sequential growth, as we've shown already quarter-over-quarter for the first half of the year, continue through the second, you know, we'll fall in between that 30-35 when we get to year-end.
Okay. Maybe squeezing one more question, what you mentioned about the GTN improvements and what do you see that the recent ACA regulation will be mandated and would that be any impact you could see change over the second half of this year or even small changes on the?
Yeah.
-GTN?
Yeah. I don't know if you saw the press release we put out. Was that last week? Just about the very recent final push where basically implied that you need to follow ACA. It could be interpreted as immediately. You know, guidance earlier in the year came out that said January first, so there's a bit of question as to if they just meant we're done hearing complaints, you guys need to comply immediately. You know, that's why we think the timing of it will continue to roll out as the second half of the year goes on, and we will start to see those continued improvement in the co-pay utilization program. Ultimately, it will come down to enforcement from the government agencies that have direct oversight over the payers and PBMs.
We think the current administration and the key members on committees are taking this extremely seriously. You know, coupled with Saundra's continued relentless pursuit of them. I can't say I blame them, unfortunately.
Well, the one thing, you know, just to add is that we have heard from a lot of these offices that we have consistently been talking to and reaching out, that there is a huge push from certainly the Democratic side to make sure that they are leaning in and stepping up for women. In the past, although they didn't wanna know specifics, all of these offices of congresspeople and senators are now asking us for specific examples when women are getting denied so they can reach out directly in hopes that they will be seen as, you know, the halo effect of being the ones that are advocating for and standing up for women. You know, what's been refreshing is that we have seen the kind of action, should have happened sooner, but we are seeing very serious and deliberate action, i.e.
Enforcement occurring, and it's optimistic, you know. At least when women are being denied, you know, safe access to abortion, they will get more and more readily access to contraception.
Okay, great. Thanks a lot for the detailed information. Again, congrats on the performance of this quarter.
Thanks very much.
Thank you very much.
Yeah, thanks for your question.
Okay, our next question is coming from Annabel Samimy of Stifel.
Hi, this is Stacy calling in for Annabel. Congrats on a really great quarter. Just two questions.
Thank you.
on our end. Can you give us some metrics around the VitaCare partnership and how that's been helping with prescription fulfillment? Secondly, you know, we're really excited to see the last visit having occurred for the EVOGUARD trial. You know, in light of the latest development with Roe v. Wade being repealed and the increased focus in contraceptions, you know, more the need to protect it. Is there any further thought to how you will treat the STI profile of EVO100 if successful? Is it protective as an addition, or is it better to remain its own product? I know the last iteration was that it would be a profile enhancer to contraception.
Yeah, thanks for the question. Jay, do you wanna start?
Sure.
I'll jump into the second one.
Yeah. Yeah, I'll jump in on VitaCare. So just a little bit of specifics for the quarterly activities. We did do a pilot-style rollout with them, and it was extremely successful right from the get-go. We are very happy to see that. Obviously, a fairly complex process with the new platform going out, so we wanted to make sure that the pilot program was effective and well-received and any kinks were worked out. Subsequent to that, we've actually rolled that out fully to the field starting August first, and we're already seeing RXs come in from that process. Feedback from the sales reps, doctor's office all across the board and patient experiences have been extremely favorable.
As a reminder, this is, you know, we throw around the term white glove, but really this is truly what this experience is. You know, beyond that and really integrating patients with a service that really follows them through the entire process all the way through ensuring that they get their refills on, you know, on a timely basis. You know, the process itself is, it's fully integrated, and it doesn't come in from multiple sources and other multiple vendors. This is truly a one-stop shopping portal for us to really fall back on and our patients to use. We're extremely excited about the initial results.
I think for sure we'll have definitely much more insight as to how that's been rolled out from the initial launch on August first when we talk for Q3 results.
You know, our Chief Commercial Officer, Katherine Atkinson, is also with us on the line. Katherine, is there anything you want to add just to, you know, fully color the VitaCare situation? Katherine? Oh, maybe she can't get unmuted. Oh.
Technical difficulties. They happen to all of us.
Yeah.
We can follow up.
We can follow up with you on that one.
Yes, we will follow up. If you have some questions about.
Katherine's line is now open.
Okay, great.
Oh.
Katherine, would you like to add anything?
Yes. I'm sorry. I was talking. They may have muted me. Yeah, we've seen some great success. As Jay said, we kind of beta tested it and slowly rolled it out. Of all the prescriptions that came in, which were many, we've had 53% already approved, and VitaCare continues to work on the remainder. We rolled it out to the field on August first, and we had about 20 already go in, and we're really excited about it. We'll have far more color coming after this quarter for you. Really great performance up through that point. You know, in our previous program, we were below the 50%, and we're not even finished with those first ones that came in. Already off the bat, really great numbers.
I want to address your question regarding EVOGUARD and the STI indications. I just want to make sure that the question. Can you just frame it again? You want to know whether or not the expanding the label we think will be as advantageous as being a separate product?
Yes, that's correct.
One thing, in the work that we have done around diligence with providers and diligence with payers, we're looking at a couple of different things. The short answer is expanding the label, we have concluded, will allow us the same opportunity as if it were a separate NDA. The financial positive is that the sNDA submission will be no cost to us, which is fabulous from a financial standpoint. Even if there was a cost and we thought it was going to be better for shareholders and women, we certainly would have incurred that cost. Where we are now is when you look at a product that, as you may or may not remember, those of you on the call, we were able to actually get a publication in a sexual satisfaction journal.
When you look at a product that has lubricating properties, and you have a product that will prevent pregnancy with no systemic activity and no hormones, and not negatively impacting your ovaries or your ability to get pregnant down the road and prevent from chlamydia and gonorrhea. I will tell you that in all of my years, I've been in women's health my entire life, we used to do these think tanks where we would say to global leaders, women, all kinds of influencers, "Let's just talk about nirvana. What would be the most amazing product?" And consistently, people would say something that you wouldn't suffer from side effects, something that you only used when you needed it, and something that would protect you from getting sexually transmitted infections. Well, let me introduce you to Phexxi. I mean that.
Of course, I would say that as the CEO of this company, but I was attracted to this company because of this asset. After spending my whole life looking at me-too products in crowded categories, understanding that when generics come to a market, they erode a brand by 50%-60%. Recognizing, most importantly, that women don't have sex every day. Men have had condoms for 150 years. It is far time that women have a product where they can have sex on demand, with pleasure, without hormonal side effects. The timing could not be better for Phexxi. It is really important to note that how our product works as a vaginal pH modulator, women intuitively understand it, doctors intuitively understand it. It's simple, and it's easy to use, and women feel really good about it.
The short answer is we feel very good that this NDA submission and expanding this label. Now, down the road, we may decide with this sort of, you know, trifecta of all of these wonderful things that, you know, maybe we want to do a relaunch down the road. What I would tell you is we feel that the market opportunity is so significant because as we said, whether you're on a pill, a patch, or an IUD, you are still at risk. Chlamydia is now so pervasive, 4 million cases. Final comment I want to say is, after being in women's health my whole life, I have to shamefully admit that I didn't even recognize that chlamydia was one of the top reasons for infertility.
When we start to talk to young women, they're already thinking about their ability to get pregnant when they want to, even though it might be 5 or 6 or 10 years down the road. If you're protecting yourself from getting pregnant and you're also worried about your ability to get pregnant, why would you not use a product like Phexxi?
That was extremely helpful. Thank you so much.
Yeah. Thank you for your question.
Okay. Our next question is coming from Ram Selvaraju of H.C. Wainwright.
Thanks very much for taking my questions. Just three relatively quick ones. First of all, I was wondering if you could comment at all on any emergent trends you are seeing in sort of private pay or non-reimbursed demand for Phexxi, particularly in the wake of the Supreme Court ruling. Secondly, I was wondering if you have sort of an updated take on returning to the concept that was mooted early in Phexxi's commercial trajectory regarding the population of women who are undergoing cancer treatment of specific categories that would lead them to be ineligible for hormonal forms of birth control.
Lastly, I was wondering if you have updated thoughts on assuming positive readout in STI prevention, how you would go about strategically optimizing the value of the drug in that indication and whether that would involve any kind of business development activity, particularly in the context of the U.S. commercial opportunity. Thanks.
Thank you, Ram, very much for your questions. I would like to start backwards, if that's all right. I'm gonna start with the last one, meaning the STI opportunities. The short answer is definitely. Why I'm saying definitely is that when we expand the label to add on prevention of chlamydia and gonorrhea, we want to provide much broader access to a much wider population. We, as you heard from Jay's comments, we are looking at co-promotion and co-marketing partners. We believe that, yes, certainly OBGYNs will be the top prescribers, but we do think that it will expand beyond that, frankly. We are trying to be very strategic and wise about finding a partner that has a footprint and that is looking for another opportunity, you know, to tell an additional story. We're actively doing that right now.
I will tell you that I know those of you who've been with us for a while, when we talk about business development, we are a little trepidatious because, you know, we could get a distribution agreement tomorrow. Yes, we have waited so that we can get the right partners. For STIs, the strategic partnerships are multiple. Our head of business development, full-time, 100% focused on these partnerships, has said that now with Roe v. Wade, what's been fascinating is that the people contacting us is so constant and continuous. We are going to look to align with somebody in the U.S. to expand our reach, still obviously controlling, you know, the branding and the messaging, but to see if there's an appropriate partner. We are continuing our efforts outside of the U.S. to bring in non-dilutive capital.
Your second question.
Ontada.
Yeah, Ontada. One of the things that we have tried to see if we can identify out of the 800,000 women that are cancer patients is there a way to see if there are carve-outs that we could identify, you know, who they are. What I will tell you is from feedback from our sales organization, and we also have our head of sales, a gentleman who spent his career in oncology, by the way, he's the one that helped us align with Ontada for this important relationship that we have. What's happening is that as time passes and even though Roe v. Wade, and you would think, what does that have to do with cancer patients?
What has been extraordinary to see is that regardless of the physician type, oncologists are continuing to open their eyes up that one, they certainly don't want their cancer patients to become pregnant during treatment. They don't want estrogen cancers to grow. The only other product, which is a copper IUD, has side effects that are oftentimes far too challenging for these patients in a vulnerable state. Phexxi is the obvious choice. We have been seeing, being asked to continuously go and provide products to hospitals, to do all kinds of grand rounds conversations, to continue to elevate and escalate the conversation. I would say that it is growing. We have not had a way to actually segment that specific population. However, when we're talking to doctors, they are part of bigger practices.
We are always making sure that our sales organizations, some of whom are cancer survivors themselves, by the way, are making a deliberate effort to go to those hospitals and talk to those clinics and those centers, and we think that's been boosting our business. The first question, I don't know if our Chief Commercial Officer or Jay File might want to address it. Jay File, do you?
Yeah. No, we do. Shall we-
I can-
Okay, perfect. Go ahead, Katherine.
Well, I think, you know, one thing that we could mention, and I think this could actually help, is in spite of whether some of these small private payers are moving this way, we are being, again, proactive in doing something that helps women. We have a cash card program that we're gonna be rolling out in the next few weeks. Even if payers aren't moving to increase access immediately, we're gonna do what we can.
Ram, does that address your questions?
Yeah, that was very helpful. I think just to clarify, you know, I was also asking about, you know, those folks who are prepared to pay out of pocket, if you're seeing sort of an increased level of interest in doing that since the Supreme Court ruling or not?
Yeah, I think to expand on that, you know, we are always, you know, about two weeks behind on script data and to get it to that level. Obviously, it's just starting to come in. I will say that traditionally, the self-pay category as we trend it is not a very significant number of our sales. It is there, which is why we also did implement that cash card program that Katherine is referring to. That has recently rolled out. Actually, it was kind of great timing on our part 'cause we rolled that out in advance of Roe v. Wade decision coming out. But I think we'll get better clarity to see if that is truly an issue to that degree.
I think ultimately speaking anecdotally, I think the majority of the Phexxi prescriptions that are coming through, you're still gonna see them either one come through you know some sort of payer assistance program, right? They've got their own insurance and/or a governmental support program that they'll you know have coverage through state or federal means. A true uptake on someone who doesn't have either and is paying straight out-of-pocket, you know, they'll definitely be there. We've put in steps ahead of time to potentially assist them. I think we'll truly see. We'll follow up on that in Q3. I think we'll have much better visibility on that to see if it truly is something that is trending up and something that we've timed right with our cash rebate card.
Thank you very much.
Thanks very much, Ram Selvaraju.
All right. That's all the time that we have for today. I'll turn the call back over to Saundra Pelletier for closing remarks.
Thank you. We continue to grow Phexxi net product sales quarter over quarter in the multi-billion-dollar U.S. contraceptive market. We are on track to meet our guidance for 2022. With the Supreme Court ruling on Roe v. Wade in June, women are increasingly motivated to protect themselves from unintended pregnancies. The recent guidelines from the U.S. government on contraceptive access should catalyze access to Phexxi at zero cost to women with no barriers to access. Additionally, there is significant upside potential from our late stage program developing Phexxi for the prevention of chlamydia and gonorrhea in women. In closing, I wanna reiterate that we remain focused on execution of our business strategies to deliver long-term shareholder value. The time for Phexxi is now. The need is greater than ever, both for hormone-free contraception and for prevention of STIs.
We are excited about our future, and we are very, very happy to have you on this journey with us. As you look to organizations that are delivering innovation but continuing to execute, when I started this call, I said that since April, we have been able to share 16 value drivers to deliver on our business and deliver shareholder return. 16. Those were not announcements that were fluff. There wasn't a whole lot of gray in there. These are very deliberate, intentional milestones that we continue to deliver on to prove that this product deserves to not only grow, but the attributes of this in a time that we are in today, it makes it such an obvious investment. The value inflection that's forthcoming in October when we share our readout for our STI study is very significant.
I wanna thank all of you that have been with us for a while, and I'd love to, again, welcome the people that are new. I really wanna thank you for your ongoing support. Have a great rest of your day.
Ladies and gentlemen, thank you for joining us. You may now disconnect.