Lei Huang: Thank you.
Operator: Thank you. And I show our next question comes from the line of Travis Steed from Bank of America. Please go ahead.
Travis Steed: Hey, thanks for taking the question. I did want to ask about Medicare versus commercial mix. I know we saw that change last quarter. Was that due to the prior auths in any way? And if you could talk about kind of the mix this quarter and the growth and kind of the Medicare versus commercial business, if you saw the Medicare business still hold in? And any comfort you can give on just to make sure that like I know you’re talking about the prior auth submissions, but just give comfort that this was more of a self-inflicted wound versus something changing on the demand side. Thanks a lot.
Tim Herbert: Yeah. Thanks. Got you. From the mix, yeah, we didn’t [ph] highlight on the second quarter that we saw an extraordinary little bit higher mix of Medicare versus the commercial. And so while we always say in the beginning of the year in Q1, it tends to be heavy Medicare. And by the time you get to the Q4, it tends to be heavy commercial naturally, because of the high deductible insurance plans resetting the beginning of the year. And the focus in Q4 is always with commercial cases. That continues to hold true. But in the second quarter, we highlighted that there’s maybe a little bit higher mix of Medicare. I think it’s a combination of a couple things, but with a delay in prior authorization submissions, yes, that is correlated with commercial cases and does work in line with that hypothesis.
So we do believe it is related to the comments we made back in the second quarter. We have confidence in the prior authorization process for the simple reason. We’ve already seen improvements and we’ve seen the trends moving forward. That gives us the confidence to be able to increase our guidance and move into the fourth quarter, and the team both the field and the internal prior authorization teams are working well with our customers to make sure that we continue to help them get their accurate and timely submissions of the prior authorizations. And as I mentioned, Travis, we’re already seeing improvements in the metrics.
Travis Steed: Great. Thanks a lot.
Tim Herbert: Thank you.
Operator: Thank you. And I show our next question comes from the line of John Block from Stifel. Please go ahead.
Jonathan Block: Thanks, guys. Good evening. I’ll ask both of my upfront as well. Maybe the first one, Tim, you mentioned the DTC switch, maybe going forward from sort of this broad base to more targeted, the prior metrics that you gave, will be relevant, it seems, in 2024 and beyond. With such a big TAM, why is now the time to change it from that broad base to more targeted? And then the second question, admittedly, some other people went there, but I think it’s an important one. There’s always the fear that hyper growth companies can’t see the next cut coming. And so can you give just some more details on how the trends changed, call it, you worked your way throughout 3Q? Or even what you saw in the first part here in the fourth quarter, to actually raise the guidance midpoint by $5 million, even while taking on that, call it, $4 million in inventory headwind from the international markets? Thanks, guys.
Tim Herbert: Got it. DTC, we’re not changing it now, but you’ve got to go, John, you’ve been with us since the beginning, from the beginning of time. Remember back, even when we did our clinical studies, we did radio ads to recruit for the clinical study. And then when we got FDA approval, we started really slow with some Facebook and some radio, and it was several years before we even started to change to get into television. And then later on, we continued to grow, and just a few years ago, we started national TV campaigns. This is just an ongoing evolution of our experience with direct-to-consumer and the learnings that we’ve adopted over time. And what we’ve realized now going forward is we can even take it to the next level, and we can start really targeting our DTC towards qualified patients and really refining that approach, and it’s going to show to be more targeted and more efficient.
And that’s just a natural progression of our program. It also goes hand-in-hand with the use of our digital tools and the technology to be able to help patients get their appointments and help with the conversion process and really help people get in front of physicians and healthcare providers and give them an opportunity to receive them for therapy. So it’s not an immediate change. It’s an ongoing evolution of our DTC program and look forward to reviewing that going forward. Certainly understand your concerns with the hyper growth concept and what do we see around the corner. In this case, pretty good data that shows limitations on the prior authorizations really had an impact and it kind of is a little bit more reflective. I know we don’t talk often about month-to-month comparisons in the quarter, but we did see an uptick in the last 2 months of the quarter that really gave us confidence going forward, and a significant uptick in the specific number of prior authorizations.
And, again, as part of evolution, as we move forward, we know the confidence in getting approvals from insurance companies with prior authorizations has gotten extremely high. And so it makes it more predictive to be able to have comfort moving forward. So we think we’re aware of what the future holds. We think that we’re well positioned to manage our DTC and manage our conversions and handle the growth appropriately.
Jonathan Block: Perfect. Thanks for the color.
Tim Herbert: Thanks, John.
Operator: Thank you. And I show our next question comes from the line of Richard Newitter from Truist Securities. Please go ahead.
Richard Newitter: Hi. Thanks for taking the questions. I’ll ask my two upfront as well. As we think of the prior authorization situation, are you basically recapturing all of the backlog, for lack of a better descriptor, that may have materialized in 3Q [ph] in 4Q? or does your guidance assume some percentage of that backlog? Or tell me if that’s not the right way to think about it? And then just secondly, you grew your revenue 2 times your expense rate. I guess, how do we think about operating leverage and that revenue growth to OpEx growth, especially as we kind of look out even into 2024, and any color that you can provide on profitability and how the new DTC, or not new, but how your approach to more targeted DTC could potentially drive increased efficiencies in the P&L? Thank you.
