So overall, David, very much what we thought was going to happen in the early stages and very positive for us in terms of opening up new markets. In terms of soft tissue, pretty interesting, David, It’s — again, the issue here is the ASCs have been almost totally consumed with the higher-margin joint, spine and some of the higher cost and higher margin procedures, bariatrics would be a good example. So, the opportunity for us to have reimbursement in the ASC has been muted by the fact that the insurance carriers are saving thousands of dollars by moving their cases to the ASC. And so, the opportunity to save $300 to be reimbursed for EXPAREL really mutes the opportunity for soft tissue in that environment. And as we’ve seen for the previous quarters, well over 75% of the use of EXPAREL in the ASC is for orthopedic procedures.
Who gets left out in that analysis is the soft tissue procedures that are low margin, that the hospitals are struggling to perform in the hospital environment because of the reimbursement structure just doesn’t even cover their costs. And so, in the outpatient environment, again because these are low margin and in many cases, these are these surgeries in these hospitals are in low income and indigent environments, these patients are getting bupivacaine and opioids: bupivacaine because it’s cheap; and opioids because they consider them free because, they write a prescription and they’re filled in an outpatient department or on a hospital — or I’m sorry, at a pharmacy that is part of Part D. So when we talk to those folks and say, in and an arrow where there’s reimbursement, what will you do?
And universally, the answer is I would love to be able to use EXPAREL if I could afford to use it, given the financial structure of my hospital and these procedures that I’m doing given the margin. So the interesting observation there, though, is when a patient needs soft tissue procedures, if they’re not done in a period of time, and we’re thinking something in the neighborhood of six months to a year, the only logical explanation we can come up with is that they learn to live with these soft tissue low acuity pain procedures. Because the numbers would suggest that there’s millions of patients walking around out there from these three years of COVID that require soft tissue surgery, and we just don’t see that demand in the marketplace, David.
So, I think the pent-up demand in ortho is real because the pain profile is such that the patients need to be treated in order to keep their job and get to work and be able to walk even to church and things like that. And soft tissue, the only explanation we have is that there’s a very high propensity for pain control in these soft tissue procedures, and patients learn to live with it. And the pent-up demand is real, but it is nowhere near apples-to-apples relative to the number of procedures that have not been done over the last three years, if that makes sense.
Operator: This question comes from Glen Santangelo of Jefferies. Your line is open.
Glen Santangelo: Dave, I also want to follow up on some of the questions that David just asked with respect to EXPAREL and sort of your outlook. If I kind of go back to fourth quarter, you said in your prepared remarks, right, that you’re continuing to outperform the elective surgery market. And then I think later in the remarks, you seem to suggest that volume grew 6% in the quarter in a flat surgical market. Did I hear that correctly with the offset in 4Q, maybe being some of the pricing differences on the 340B program, in particular, that you talked about? Is that a fair assessment of what happened in 4Q?
