Charles Reinhart: Hey, Balaji, it’s Charlie here and so I think one of your questions might have been about the amount and so from our perspective, we looked at what typical first time people size, and it was kind of 10% to 15% of market cap, and that’s really how we came up with 150 million. We also note that we haven’t between now and the end of 2026 to utilize it, but if we utilize it more quickly and it makes sense, we can go back to the well and get another authorization. So this is something we’re going to try. We’re going to use it opportunistically and hopefully to everybody’s benefit.
Frank Lee: Thanks, Charlie. And I think, Balaji, your other question was about broadly NOPAIN and just some numbers. So 18 million total that we believe are outpatient procedures that could fall under NOPAIN, now, specifically with respect to the settings and patient populations. So out of that 18 million, six million CMS and 12 million commercial and so inside that six million is roughly about four million that lie within the HOPD setting and two million that are within the ASC setting, whereas in the commercial, that 12 million in the commercial is roughly about four million in the HOPD setting and about eight million in the ASC setting. So hopefully that’s clear.
Balaji Prasad: If I could ask a follow up there, Frank, just what percent of these 18 million procedures would be incremental to EXPAREL? That is, those who are not in EXPAREL today through any pathway?
Frank Lee: Yeah, I think by and large this is going to be a very favorable impact and particularly if I think about the CMS patients right out of the gate, six million CMS patients in the HOPD specifically and ASC, I can’t give you a hard number right now about how much is incremental, but what I can say is that our penetration, largely speaking, is fairly low. And a lot of that is due to the cost barriers that have existed and hence, that was the thinking behind making sure that we drive NOPAIN legislation to passage. And so the company saw that early on and has worked over the past seven years with our Voices coalition in partnership, and that’s why this thing was passed. And so fundamentally, it’s pulling the drug reimbursement or product reimbursement out of the bundle.
So there’s not a financial disincentive to use the best product for the patients. So hopefully that’s clear. So I think given our low share penetration in this marketplace, we’ve got substantial room to further penetrate where those cost barriers are the real issue.
Operator: Your last question comes from the line of John Glonka [ph] with Needham and Company. Please go ahead.
Unidentified Analyst: Hi, everyone, this is John on for Serge. Thanks for taking our questions today. We have two questions regarding EXPAREL pricing for this year and beyond. First, can you provide some context on what the discount looks like right now to improve the user base and what the strategy might look like for the rest of the year based on what you’ve seen so far? And then when NOPAIN comes into effect next year, what does the pricing strategy look like at that point with improved reimbursement? Thanks.
Frank Lee: So, Charlie, maybe you want to talk a little bit about EXPAREL pricing strategy. What I’ll say here is that when you think about what we’re doing with GPO and access to 340B, that’s very favorable. So I’ll say that, and with NOPAIN, obviously the reimbursement then gets better as opposed to the pricing. So beyond that, Charlie, maybe probably a little bit of color.
Charles Reinhart: Sure. So if we think about EXPAREL’s total gross to net at this point, it’s a hair under 84%. And that includes product returns and prompt pay discount. It includes 340-B, a series of individual customer contracts and over time, it will also include the GPOs as well. I think that was probably your question. If you’re talking about pricing, actually price increases, we’ve been pretty modest in that regard. We did one in January, and we’re really focused on expansion of the top line by volume. Not so much price.
Unidentified Analyst: Yeah, I think really just for next year when NOPAIN comes to effect. Do you see the pricing kind of taking a, I don’t know, a more lumpy change at the beginning of the year, or do you see more of a gradual flip from a discount to a price increase?
Frank Lee: So ASP plus 6 is critically important in the outpatient setting to drive volume. ASP plus 6 has nothing to do with our ROI [ph] or the prices we will charge. So I don’t know that we will change our strategy in any way, shape or form. We’re just going to try to educate our potential customers so that they can benefit from ASP plus 6 and we can benefit from volume.
Charles Reinhart: And, John, I want to go back to. We’re sharply focused on growth. Doing so solves a lot of things, including margin. Some of the questions earlier and this is the opportunity for us to drive penetration and growth with this catalyst of NOPAIN. So that’s what we’re focused on.
Operator: That concludes our Q&A session. I will now turn the conference back over to Susan Mesco, Head of Investor Relations for closing remarks.
Susan Mesco: Thank you, Hermione and thanks to all on the call for your questions and time today. We are excited about the opportunities that lie ahead for us. Throughout the balance of the year, we will continue to ensure we are well positioned for long term success. The opioid epidemic continues to be a national crisis, underscoring the vital importance of our mission. Thank you and stay well.
Operator: Gentlemen. That concludes today’s call. Thank you all for joining. You may now disconnect.
