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Biodelivery Sciences International Inc (NASDAQ:BDSI)
Q2 2020 Earnings Call
Aug 5, 2020, 10:30 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good day and welcome to the BioDelivery Sciences Second Quarter 2020 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Terry Coelho, Chief Financial Officer for BioDelivery Sciences. Please go ahead.

Terry Coelho -- Chief Financial Officer

Thank you and good morning, everyone. Welcome to our second quarter 2020 earnings conference call. Leading the call today is Jeff Bailey, Interim Chief Executive Officer. We are joined by Scott Plesha, President and Chief Commercial Officer. Following our prepared remarks, we will conduct a question-and-answer session. Earlier today, BioDelivery Sciences issued a press release announcing its financial results for the second quarter 2020. A copy of the release can be found on the Investor Relations page of the company's website. Before we begin, I would like to remind everyone that certain statements may be made during this call, which may contain forward-looking statements. Such forward-looking statements are based upon current expectations, and there can be no assurances that the results contemplated in these statements will be realized.

Actual results may differ materially from such statements due to a number of factors and risks, some of which are identified in our press release and our annual, quarterly and other reports filed with the SEC. These forward-looking statements are based on information available to BDSI today, August 5, 2020, and the company assumes no obligation to update statements as circumstances change. An audio recording and broadcast replay for today's conference call will also be available online in the Investors section for the company's website.

With that, I'd like to turn the call over to Jeff Bailey, interim CEO. Jeff?

Jeffrey A. Bailey -- Interim Chief Executive Officer

Thank you very much, Terry, and welcome everyone to our company's second quarter 2020 earnings call. This is my first earnings call with you as the interim CEO and it takes place during a challenging time for the country and for the entire pharmaceutical industry. However, I'm really fortunate to have inherited a dynamic and growing pair of brands, a strong balance sheet and an inspiring, high-quality management team who are extremely focused on execution in this new environment.

There are three things I really hope you will take away from our quarterly earnings call. First, we mobilized an internal team very early in the COVID pandemic to ensure we are proactive and operate in the most effective way possible, reviewing in a very structured weekly venue to national and local data, listening to caregivers and employees while observing how other companies are approaching this new environment. This has really made a big difference. Second, our team performed very well in the second quarter with BELBUCA continuing to take market share in the TRx long-acting opioid market and BELBUCA continuing to show strong growth year-over-year. The second quarter BELBUCA performance also includes BELBUCA hitting an all-time high in TRx volume and market share.

We also saw Symproic hit an all-time high for TRx volume and market share as well. This is a real tribute to our differentiated products as well as outstanding commercial execution from the BDSI team. While my title is interim CEO and this is the third thing I'd like you to take away, I want to assure you that I plan to remain in a key leadership role for BDSI for long term. I am very committed to working with my strong executive team and the BDSI Board to take BDSI to next level as we are hyper focused on continuing the strong growth of our products as well as concentrating on business development strategies that really bring value to the patients, caregivers and shareholders that we serve. I am pleased to say that I've been working closely with the management team in my first three months and they have made it easy for me to really hit the ground running.

Now let's start and get into some of the details. On the results front, the big positive for BELBUCA is that we outperformed the TRx long-acting opioid market nicely by growing BELBUCA, TRx volume by 5.2% over Q1 while the market was down by 1.6%. Additionally, BELBUCA TRx market share hit another all-time high by growing to over 3.8% in Q2 compared to 3.6% in Q1. This growth highlights the momentum for the brand, which was also confirmed by the fact that revenue for BELBUCA grew 34% year-over-year. It's important to stress that we are focusing on new tactics during this pandemic to drive new-to-brand market prescriptions.

NBRx scripts were down in Q2, and we believe that this trend was driven by significant decline in patient in-person visits to physician offices, which some estimate in the range of 30% to 40%. As a result, the NBRxs in both BELBUCA and long-acting op markets were down approximately 18%. We feel strongly that this change in market conditions require some new tools to help boost new patient starts. The team has done a really nice job of focusing on this dynamic in the COVID environment as Scott will give you more details when he speaks shortly. Scott will also cover additional details on the new selling programs that we have implemented during the pandemic. Our sales team has adapted to a hybrid selling model where reps still have face-to-face customer actions where possible but also are effectively using virtual promotional and educational tools to support our work with caregivers.

We also recognize that managing business during the pandemic is a moving target within local geographies. We therefore remain very vigilant and nimble and use our now well-established process with our weekly COVID dashboard and live weekly team meetings to really stay on top of our game. Now let's get into the slides. Getting back to our rapid response to the COVID pandemic, I'm extremely proud of how our employees have responded to this unprecedented challenge. We acted quickly and swiftly on three fronts. First, we focused on taking actions to ensure the safety and well-being of our employees, patients and the communities we serve.

Very early on, we proactively procured additional materials to ensure constant supply of our products as they provide important clinical relief for patients suffering from chronic conditions. Secondly, we transitioned our customer engagement to virtual support and launching array of new customer and patient support programs. And finally, the internal COVID-19 cross-functional committee we established, which I mentioned before, has been vigilantly assessing trends and market dynamics, benchmarking best practices across the industry and ensuring we are highly focused to navigate through this unprecedented situation.

We see that these actions are having a beneficial impact on our business based on the brand trends thus far and believe, there will be important components for continued momentum as our customers return to more normal operations. Going to the next slide, you really see that there's strong performance, both year-to-date and in Q2 positions us advantageously for future growth. As I mentioned before, BELBUCA really outperformed the market and also hit an another all-time TRx share high of 3.8%. This continued momentum is so important, especially during time when other products in our space are declining. Next, I want to mention that we have positioned ourselves well by further optimizing our sales force in Q1 by adding new territory managers in the field to grow incremental revenues. I am pleased to say these territories overall are gaining additional traction in Q2. Also important to our growth is our company's substantial progress at payers and realizing more opportunities that make financial sense for us. We continue to make good progress on this front, as Scott will share more detail.

We've begun to capitalize on some recent previously announced market access wins. In addition, we've expanded access within several prominent regional health systems, which offer both their own covered lives as well as potential influence on clinical practice within their metropolitan communities. And lastly, we began the year with a strong balance sheet and have been able to strengthen that and our cash with a very successful second quarter, assuring its financial strength is a key strategic priority for BDSI. And we are prudently managing our spend during this period to protect and steer the business through this near-term disruption, while continuing to invest toward sustained long-term growth.

Our strong balance sheet allows me to spend a meaningful percentage of my time along with other senior members of our team, exploring strategic business development opportunities in speaking with potential partners. To conclude, I'm very pleased by the success of the second quarter as well as how the organization has responded to the challenges presented by the COVID-19 pandemic. We have therapeutically important products, a strong balance sheet and a talented and committed team of employees. We remain poised to successfully navigate through the short-term uncertainty and achieve our ambition of long-term sustained growth.

With that, I'll turn the call over to Scott to provide more details on our performance during the second quarter. Scott?

Scott Plesha -- President and Chief Commercial Officer

Thank you, Jeff. As Jeff mentioned, during Q2 BELBUCA prescriptions grew by 5,160 to a new high of more than 104,600 retail TRxs. This represents almost a 31% increase in BELBUCA TRxs compared to the second quarter of 2019 and a 5.2% increase over the first quarter of 2020. This was accomplished despite a 1.6% decline in the overall long-acting opioid market during the second quarter. We were pleased with BELBUCA's continued growth, which led to its Q2 TRx market share increasing to over 3.8% from 3.6% in the first quarter of 2020. During the second quarter, BELBUCA's new-to-brand market share of 7.3% held steady from the first quarter, well above its TRx share of 3.8%. And there is still a significant opportunity to grow total prescription share as these metrics historically converge.

New-to-brand prescriptions declined from the first quarter to second quarter as stay-at-home orders were in effect. However, we were encouraged by the improvement in new patients being prescribed BELBUCA as states began reopening in June. BELBUCA's prescriber base remained stable in the second quarter as the impact of the pandemic was most pronounced during this period. There were over 7,600 total unique prescribers in the quarter. And we are encouraged by the fact that BELBUCA reached a new monthly high of 6,170 unique prescribers during June as patients began to return to offices. As of early July, our sales force has been redeployed across all territories, enabling in-person visits in addition to their continued virtual interactions. As we previously announced, in early Q2, we were able to improve BELBUCA coverage from nonformulary -- not covered to covered or preferred status in over 2 million Medicare Part B lives within Express Scripts, SelectHealth and UPMC Health. It's still early since the addition of these wins, but we are encouraged by the growth we are seeing across these plans and would expect their uptake to increase in Q3 and Q4.

We continue to believe that with additional work, we have the potential to add several million more Medicare lives as we head into 2021. On the commercial side, in Q2, we improved our coverage within two prominent regional commercial plans. Highmark Blue Cross Blue Shield and University of Pittsburgh Medical Center or UPMC. These wins improved coverage for over 760,000 lives combined. Again, it's early news wins and we anticipate growth in Q3 and Q4 from these plans. Symproic Q2 retail prescriptions reached a new high of over 17,200, representing an 11.1% increase year-over-year compared to Q2 2019 and a 6.7% increase over Q1 2020. We are also excited to share that Symproic enjoyed its largest quarter-over-quarter prescription growth since we relaunched it in Q2 of 2019.

During Q2 2020, we generated a 13.4% NRx share and a 12.3% TRx share, representing the highest market shares to date. We expect continued TRx and revenue growth for Symproic, as its NRx share has consistently exceeded total Rx share since May 2019 when BDSI began active promotion. In the second quarter, we successfully added 940 new prescribers for Symproic, maintaining our prescriber universe of approximately 5,000 healthcare providers. We view Symproic as a highly complementary brand to BELBUCA and continue to believe our early 2020 market access wins with Prime Therapeutics and CVS will be callus for growth for the remainder of 2020 and beyond.

The BDSI sales force has done a strong job taking advantage of these wins and improved our TRxs within Prime Therapeutics by approximately 56% in Q1 and 38% in Q2 compared to the previous quarter. We've also seen consistent growth within CVS where our market share in the PAMORA class has increased from 10.5% in Q4 2019 to 14.4% during Q2 of 2020. We're also excited to announce that we've recently enhanced Symproic access with an independent Blue Cross Blue Shield and Humana commercial lives.

Over 1 million lives under independent Blue Cross New Shield have moved from nonpreferred status with a step edit required to a preferred unrestricted status. Within Humana, approximately 420,000 lives will now be covered at a nonpreferred level without restriction compared to a nonformulary not covered status previously. We believe that the BDSI commercial team will be able to pull through these wins and build upon the brand's momentum. We're very proud of the results that the commercial team generated during Q2, especially within an environment and market dynamics that we faced due to the COVID-19 pandemic. While the influx of the new patients to our products and the markets they are in slowed during the quarter, we are encouraged by the increase in patient visits and NBRxs as states have reopened over the past 2 months. As the impact of COVID-19 grew, our focus was on supporting our HCPs and their patients while ensuring the safety of our employees.

We accomplished this by reinforcing the many resources we offer to patients and HCPs and the unique attributes our products possess. We also augmented our patient support by providing enhanced co-pay coverage for BELBUCA and prior authorization assistance for both BELBUCA and Symproic. As Jeff highlighted, our commercial team rapidly adapted to the new promotional environment. We have equipped our sales team with tools that facilitate effective discussions around the clinical value of our products, either in person or virtually. This includes a virtual customer engagement platform, a dedicated email portal as well as the ability to ship samples and other resources directly to offices.

During the quarter, we also adapted many of our marketing programs and amplified our digital marketing efforts. This resulted in an increased digital presence as we implemented new programs and magnified others. We have built a sales and marketing platform that will allow us to promote our products effectively and compliantly to HCPs and patients during a very unique time. Importantly, it also provides a foundation that will allow us to adapt as the selling environment evolves.

We had a very successful Q2 that resulted in yet another record quarter for prescriptions, and many other important growth metrics for both BELBUCA and Symproic. Our Q2 results support the effectiveness of our commercial team, and more importantly, the clinical value that our products provide to patients and HCPs. We continue to believe that with our high level of execution, incremental market access improvements and with patients returning to offices, we are very well positioned for growth in the second half of 2020 and beyond.

In concluding, I'm particularly proud of the dedication, nimbleness and focus our commercial team exhibited to support our healthcare professionals and their patients during these challenging times. With that, I'll turn the call over to Terry to provide an update on the financials. Terry?

Terry Coelho -- Chief Financial Officer

Thank you, Scott. As Jeff and Scott discussed, we are excited to report our second quarter results, which have remained strong despite the COVID-19 pandemic. Total net revenue for the second quarter 2020 was $36.6 million, an increase of 23% compared to $29.7 million in the second quarter of 2019. Year-to-date net revenue through June 30, 2020, of $74.9 million grew 51% compared to the same period in 2019, driven by strong BELBUCA growth and the impact of the Symproic acquisition, partially offset by lower sales of BUNAVAIL. BELBUCA net sales in the second quarter were $32.3 million, an increase of 34% compared to $24.1 million in the second quarter of 2019. While TRxs grew approximately 5% in the quarter, the net sales decline of 3% in the quarter versus the first quarter of 2020 was primarily due to the timing of shipped orders and a tightening of wholesaler inventory in the second quarter of about 4 days compared to the first quarter and compared to the levels of inventory typically held.

Year-to-date BELBUCA net sales through June 30, 2020, of $65.8 million grew 54% compared to the first half of 2019. Symproic, which was acquired during the second quarter of 2019 has been an ideal complementary product for BDSI as we were able to effectively integrate it into our product portfolio and take advantage of the substantial overlap in the target prescriber base. Net sales for Symproic in the second quarter of 2020 were $3.4 million. Similar to BELBUCA, while TRxs grew close to 7% in the second quarter compared to the first quarter of 2020, the net sales decline of 18% in the same period was primarily due to the timing of shipped orders and a tightening of wholesaler inventory in the second quarter of about 6 days compared to the first quarter. Year-over-year net sales in the quarter grew 7%. As a reminder, the second quarter 2019 net sales results incorporated the benefit of a distribution agreement with Shionogi, which favorably impacted the second quarter 2019 net sales. BUNAVAIL net sales for the second quarter were $700,000 compared to $800,000 in the second quarter of 2019. In March of this year, the company announced a planned discontinuation of marketing of BUNAVAIL in 2020 and ceased ex factory sales effective June 15, 2020.

The royalty revenues for ex U.S. sales of PAINKYL and BREAKYL totaled $137,000 for the second quarter, a decrease of $400,000 when compared to the first quarter of 2020. Total gross margin for the quarter was an attractive 85% as compared to 83% in the second quarter of 2019 and consistent with the 85% margin during the first quarter of 2020. As Jeff discussed, management swiftly took action when the pandemic first emerged to ensure we were protecting our cash position in light of the high degree of uncertainty at that time. A key area of focus was to evaluate our operating expenses across all functions to ensure prioritization of critical initiatives needed to support our continued growth while making sometimes tough choices about deferring certain planned activities. As a result, excluding the one-time financial impact of costs associated with the transition of our CEO, we were able to reduce continuing operating expenses by $3.5 million in the second quarter as compared to the first quarter of 2020. With that said, total reported operating expenses in the second quarter of 2020 were $28.2 million compared to $22 million in the second quarter of 2019 and $26.7 million in the first quarter of 2020.

The year-over-year and quarter-over-quarter increases are primarily driven by the one-time costs associated with the CEO transition in the quarter, partially offset by lower T&E spend. GAAP net income for the second quarter was $1.2 million or net income of $0.01 per share compared to a GAAP net loss of $11.1 million in the second quarter of 2019 or a net loss of $0.13 per share. The year-over-year improvement in GAAP net income of $12.3 million is primarily driven by an $11.7 million decrease in non-operating expenses related to the CRG debt extinguishment incurred during Q2 2019. Year-to-date GAAP net income through June 30, 2020, was $6.1 million, an increase of $21.1 million compared to the same period in 2019. EBITDA in the second quarter of 2020 was $5.1 million or 14% of net sales compared with $4.8 million in the second quarter of 2019 and $7.8 million or 20% of net sales in the first quarter of 2020.

This quarter marks the sixth consecutive quarter of positive EBITDA for BDSI. Year-to-date EBITDA through June 30 of 2020 is $12.9 million or 17% of net sales compared with $4.9 million or 10% of net sales for the same period in 2019. Non-GAAP net income for the second quarter was $9.6 million and reflects GAAP net income, excluding stock-based compensation, non-cash amortization of intangible assets, the nonrecurring financial impacts of the BUNAVAIL discontinuation and the one-time expenses related to the CEO transition. This compares to non-GAAP net income of $8.3 million in the first quarter of 2020, excluding stock-based compensation and non-cash amortization of intangible assets.

Year-to-date non-GAAP net income through June 30 of 2020, was $17.9 million compared to $3.2 million for the same period in 2019, an increase of $14.7 million year-over-year. As of June 30, 2020, BDSI had cash and cash equivalents of $91 million as compared to $70.6 million at March 31, 2020. The combination of continued strong revenue and attractive gross margins, together with cost reductions discussed earlier, and excluding the impact of the CEO transition-related costs, resulted in positive operating cash flow year-to-date through June 30, 2020 of $6.7 million or $5 million of positive operating cash flow, including those costs. For the second quarter, operating cash flows, also excluding the impact of the CEO transition costs, were essentially breakeven.

The overall $20.4 million increase in the cash position over the prior quarter includes the net proceeds of $19.6 million from the drawdown in May 2020 of $20 million from tranche B of our existing debt facility. The decision to opportunistically draw down the expiring second tranche of the loan reflects our ongoing commitment to enhance our cash position while retaining the flexibility to support the company's important, organic and business development growth opportunities. The company's total long-term debt position as of June 30, 2020, was $80 million. We are very pleased to have ended the first half of the year with revenue growth greater than 50% year-over-year, continuing profitability reflected in our 17% EBITDA margin year-to-date and a strong cash position. Importantly, we are managing our expenditures prudently, ensuring prioritization and continuation of key initiatives.

I will now turn the call back to Jeff for some concluding remarks before we open up the call for Q&A. Jeff?

Jeffrey A. Bailey -- Interim Chief Executive Officer

Thank you, Terry. Overall, as a company, we are very proud of our resilience and the team's ability to adapt very effectively over the past two quarters. We expect to see continued momentum from our early investments in our hybrid commercial efforts and our strategic actions to strengthen and broaden our customer relationships. Our high-quality differentiated products, coupled with our dedicated team positions us well for a strong second half of 2020. We now like to take your questions. Operator?

Questions and Answers:

Operator

[Operator Instructions] We will now take our first question from Brandon Folkes from Cantor Fitzgerald. Please go ahead. Your line is open.

Brandon Folkes -- Cantor Fitzgerald -- Analyst

Hi, thanks for taking my questions and congratulations on the progress in the quarter navigating a tough backdrop. I wanted to just drill down a little bit into the funnel of new patients. And what you saw in the quarter and maybe also what you are seeing in July? Granted, there's obviously a number of challenges within COVID. But could you just elaborate whether is the challenged patients staying on an IR opioid longer or they -- the long-acting that they're on? Or is it even earlier in the funnel and that patients are not even going on IR opioids at the moment? And any color in terms of whether then this challenge around new-to-brand may extend a little bit beyond the lockdowns as we have patients entering this funnel? And then do you have any data on how long patients are actually on either an IR opioid or a different long-acting opioid before they are switched to BELBUCA?

Jeffrey A. Bailey -- Interim Chief Executive Officer

Scott, do you want to read out first and then I -- you go first, Scott, please.

Scott Plesha -- President and Chief Commercial Officer

Yes, Jeff. Thank you. Hey, Brandon, it's Scott. Thank you for the question. I appreciate it. So a couple of dynamics we're seeing, and I can give you some kind of round numbers. But in general, if you look at Q1 NBRx numbers for the long-acting market and where we are as well, we see about a 18% decline in NBRxs for the LAO market, and we are basically in line with that. So if you were to look at what that means on a weekly basis for us, we did maintain our share. In my prior comments, we did maintain a 7.3% NBRx market share. But in fact, that costs you about 300 new-to-brand scripts on average a week during April and May.

What was encouraging to see is that, that delta in the month of June, once states reopened, actually was cut in half, more than cut in half. So we started seeing patients coming back in the office. So we really view the decline as more of a patient into offices, a lot of the pain management physicians want -- and mid levels want to actually see a patient face to face before they make a change in therapy.We saw, based on the data that we have, and this is across all specialties, there was about a 30% to 40% reduction throughout Q2 in office visits. That was supplemented by about a 10% telemedicine. However, obviously, that doesn't cover that delta completely. So we believe that's the drop that we saw was really just patients not going into the office to be transitioned over to long-acting opioids. We don't have -- it's obviously new data. I don't think we have enough data yet to make a determination if they're just staying on short-acting longer, I think that's a good assumption in that they're just not moving, not able to go into an office and have a change made.

I imagine they're probably just playing around with different dosages, moving patients dosages, titrating, whatever they need to do on the short acting. So -- and as a reminder, we don't see a lot of in the class whether it's to BELBUCA or from BELBUCA to other long-acting, there's really not much movement. It is really about the short-acting patients being transitioned to long-acting is where the primary growth is. So hopefully, that answers your question.

Jeffrey A. Bailey -- Interim Chief Executive Officer

And Brandon, if I could just add to Scott, did a really good job covering some things there. And also, I think another thing that we really [Technical Issues] during the pandemic so far is that we control a fair amount of some things. And we cannot control -- I mean the patients, their frequency going to see their doctors to get into the office. And Scott highlighted, we're seeing a trend to go back to the office. But I think really important to note is that we're finding that the hybrid activity by our sales team, where there's the combination of face to face also their virtual interactions with customers is correlating to total prescriptions and activity and results there. So I think it's -- with all the noise that's out there, we're really paying close attention to data.

And we mentioned that we're very focused [Technical Issues] with our weekly COVID-19 world. And just as we have a weekly venue and a dashboard where we really look very closely all the data. And we're seeing that correlation, which to me is really important [Technical Issues] correlation between activity, both hybrid -- as far as hybrid when it comes to virtual and also face-to-face or action by our team. And that means that look at BELBUCA is promotionally sensitive, that always means something. So you always want to feel like you're controlling some things going around you. And while we can't control the patients getting back to the office, the NBRx that Scott was referencing, I think [Technical Issues] takeaway key learning that we're seeing so far in the new environment. Brandon, did we answer your question, OK?

Brandon Folkes -- Cantor Fitzgerald -- Analyst

You did, very comprehensive. Thank you very much [Indecipherable]. One follow-up, if I may, for you, Jeff, ready. I think I heard business development a few times mentioned today. So could you just talk about your business development priorities? What types of assets you may look at? And how do you see the opportunity set within the current environment? Thank you.

Jeffrey A. Bailey -- Interim Chief Executive Officer

Yes. So a few things. I think just stepping back and looking at -- much of my experience has been in the space of business development and really building larger product lines for companies [Technical Issues]. So I'm really focused right now, working with the senior management team in that area. And you take a look at, first of all, we're starting off with a very strong commercial infrastructure. Of course, we always want to make sure we leverage that. So that's the first thing, Brandon, that we want to see if there's a way we can leverage that with our business development activity. And there are a number of attractive assets that are out there to look at.

And [Technical Issues] given before, but just as examples, because it's certainly not limited to, but neurology and CNS or areas that could be complementary to our focus. And also, we're a company that makes us [Technical Issues] we have a history now with BELBUCA, now Symproic of taking assets, launching them and relaunching them and doing that successfully. And we've really beefed up in the area. I think something that earlier in the year we brought in a head of business development and something that really is focused on this next chapter of the company and there's a lot of work going on. So we'll be very thoughtful, very judicious on what we're doing with that and really making sure we're focusing on the right things.

As far as more specifics, I can't go into a ton of details, but I can tell you that we're very much focused on meeting unmet medical needs, especially commercial products, but also late-stage products as well and really making sure that we're being -- looking at the different opportunities out there that could be really efficient in our operating model. So you probably tell from my comments that this is a big area of focus. And we have a strong team to be able to really make sure we see some things through. But that's where we stand right now, Brandon. Okay.

Brandon Folkes -- Cantor Fitzgerald -- Analyst

Thank you very much. That's very helpful.

Operator

We will now move to our next question from Oren Livnat from H.C. Wainwright. Please go ahead. Your line is open.

Oren Livnat -- H.C. Wainwright -- Analyst

Thanks for the questions. And congrats on pretty strong execution, despite a lot of challenges. I guess, if you could just revisit the opportunities for switching, maybe even from other long-acting products. I know that's not a big part of your narrative and you've been very clear that IR to ER drives most of your volume. But I get a lot of questions about all this volume out there in the market for both OxyContin and even Butrans, which I think combined with the generic or authorized generic is actually still larger than BELBUCA.

And people ask me, why are you not capturing more share from that market given challenges that manufacturer and those products itself have? Obviously, you have clear differentiation in Butrans. I imagine the promotion there is flagging. So what opportunity do you have with or without COVID impacts to capture some of that massive volume sitting out there? And I do have a follow-up. Thanks, Oren. It's Scott. I'll take that question. So first on buprenorphine side of things. We -- to your point, we have not cannibalized much of the generic buprenorphine market. That's fact. We really have expanded the marketplace. It's actually, if you think it's attributed to the molecule, buprenorphine it's really only molecule over the last couple of years, that's actually been able to grow in the environment while the other long-actings were falling off. We are actually up to approximately a 45% share now of the buprenorphine market. We do believe that we can continue to expand the marketplace, just some color as to how the category has performed during the quarter. We did see BELBUCA outperform the buprenorphine patch, new-to-brand as well as TRxs during the quarter as well. They did not grow as much. We actually cannibalized some of their business. And to your point, though, it hasn't been our focus. There is -- the product was promoted by Purdue, very wide ranging, primary care. There are a lot of physicians that were basically writing one script here or there. It's kind of an inch deep mile wide. So when we look at our core group of physicians, we're performing quite well, and we have territories even with 80% to 90% shares of the marketplace within our core targets. As far as the long-acting market, when we look at all the data and this is not just us. What we see is pretty much every brand or molecules getting patients from the short acting. It's just the way that HCPs have learned to practice. And honestly, it's been the most effective way for us to gain business is to kind of step in, catch people. And we think it's the appropriate also is when people are -- patients are moving from a short-acting to a long-acting that it's to BELBUCA. So we've really focused our efforts there. And honestly, it's a lot larger opportunity. I know we can look at all the businesses out there, but there are a lot of patients who have been on Oxy, for example, that are doing quite well. Okay. And at the beginning of the pandemic -- I don't mean to interrupt, sorry.

Scott Plesha -- President and Chief Commercial Officer

No, that's fine. Go ahead, Oren, sorry.

Oren Livnat -- H.C. Wainwright -- Analyst

Well, you also highlighted some of the advantages you probably had versus other C2 opioids, whether they be IR or ER early in this pandemic with regards to your advantageous scheduling, being able to call in scripts multiple prescriptions, have you -- I mean, clearly, you've outperformed the market overall, but have you detected a major impact of those properties? Is that something that you are able to promote now and even going forward? I mean, obviously, there's a lot of fear about resurgence of disruptions, and you would think that if I was a doc, transition from that, want to get them on something that I know I can maintain and do refills and write new prescriptions much easier if we went into a lockdown again, God forbid. Is that something that you're focused on?

Scott Plesha -- President and Chief Commercial Officer

Yes. It's part of our messaging, definitely efficacy first, but some of these other attributes, second. And we do feel that it -- those messages -- so to your point early on, we emphasized those messages. And it was about keeping patients on therapy and making sure the HCPs and patients have the resources they needed to stay on therapy. We've really focused recently on the NBRx side of things and have put some programs in place to accelerate that. And part of our messaging going forward. To your point, Oren, the markets have opened up now and states have opened up, those messages may not resonate the same right now. But we are saying, in case that they do close down again, here's an advantage. So...

Oren Livnat -- H.C. Wainwright -- Analyst

Okay. Thanks. Appreciate it.

Scott Plesha -- President and Chief Commercial Officer

You're welcome. Thanks.

Operator

We will now move to our next question from Greg Fraser from Truist Securities. Please go ahead.

Gregory Fraser -- Truist Securities -- Analyst

Thank you. It's Greg Fraser on for Greg Gilbert. Good morning, everybody. Terry, you mentioned wholesaler inventory tightening, where do inventories for BELBUCA stand? And what do you view as a normalized level? And can you comment on any material gross to net changes during the quarter?

Terry Coelho -- Chief Financial Officer

Yes, absolutely, Greg. So in terms of the inventory levels, what we have typically seen over -- as long as I've been with the company for the last year and a half has been anywhere in the kind of 2.3 weeks to 2.5 weeks, right in that range. That's where we'd like it to be with our -- kind of our growth trajectory. We saw a drop-down at the end of Q2 to under 2 weeks to about 1.9. And some of the whole -- a couple of the wholesalers, in particular, have really seem to have tightened down in general.

We think it's probably maybe a bit of them managing their own businesses across the board, but that's where we are right now. We personally -- I mean, Scott and I watch this very carefully, and our idea would be to be around 2.5 weeks, so I think, at least, to be able to manage the growth that we have. There were not any material movements in the gross nets overall, pretty consistent quarter-over-quarter. As I typically do see, the second quarter inches up a little bit compared to the first quarter and the third quarter will, again, as patients move into the donut hole and the coverage gap, but I wouldn't call it a material shift. It was maybe 1% or so.

Gregory Fraser -- Truist Securities -- Analyst

Got it. And coming to the SG&A savings that vested in the quarter? Would you say are temporary versus more permanent in nature?

Terry Coelho -- Chief Financial Officer

I'm sorry, you cut out at the beginning of your question. Could you repeat the beginning of it?

Gregory Fraser -- Truist Securities -- Analyst

Yes. How much are the SG&A savings in the quarter? Would you say are temporary versus more permanent?

Terry Coelho -- Chief Financial Officer

That's a great question. I would say that most of it is, I guess, what you would call permanent in nature. We've deferred some activity. So there are some investments or initiatives that we'd like to pursue that maybe we come back to at a later time. Some of it is, I would say, is potentially temporary. It's related to T&E savings as reps are not -- reps and others of us are not traveling as much. So if and when the world gets back to traveling, as it did before, I think we'll see that pick up some. But we did take a hard look across a number of areas to make some savings in terms of potential new hires and other activities.

Gregory Fraser -- Truist Securities -- Analyst

Got it. And then just kind of a bigger question -- bigger picture question on the long-acting opioid market. As you think about the size of the market and how big it used to be and how big it got to at its peak and how it's been shrinking for a number of years, what do you view as sort of a normalized baseline level for long-acting opioid prescribing? And when do you think the market could reach that point?

Scott Plesha -- President and Chief Commercial Officer

Hey, Greg, it's Scott. Appreciate the question. So when we're modeling kind of where the market will be. We're -- it depends on what products, obviously, you're throwing into the market. Ours is pretty inclusive. But we're looking at somewhere north of 875,000, closer to 900,000 TRxs on a monthly basis.

Gregory Fraser -- Truist Securities -- Analyst

Got it. And just a quick last one for Jeff. Are you considering dropping the interim title? Thank you.

Jeffrey A. Bailey -- Interim Chief Executive Officer

I hope everybody can hear me, I understand my connectivity is not great. We had a power outage around here last night. So hopefully, if they can hear me OK. Yes. As far as the interim title goes, as I mentioned in my remarks before, I had planned to very much remain in a key leadership [Technical Issues] long term. I'm very committed to work with the executive leadership team, which I found just to be excellent and also with the Board. And this is all about taking BDSI to the next level. It's a space I know well, pharma sector, I know well.

And we're very much focused on continuing the strong growth and really focusing on our differentiated products and also on business development. As I mentioned before, it's really a key area for us as well. So when you take a look at it, I've done the CEO role quite a number of times, and I really like the challenge. Right now, I'm going to be in the interim role on continuing forward and definitely, there's really no plan to change that at this point. But just a major thing I'd like you to take away is we have a strong team, we have great products and we're very committed to making sure we take things to the next level and my full energies are focused on delivering great execution and results. So no change in status at this point. That's for sure.

Gregory Fraser -- Truist Securities -- Analyst

Got it. Thank you.

Operator

We will now move to our next question from Scott Henry from Roth Capital. Please go ahead. Your line is open.

Scott Henry -- ROTH Capital Partners -- Analyst

Thank you and good morning. I guess just for starting, do you have any thoughts on revenue guidance? I know you had it out there before and then kind of pulled it back. Any -- do you want to make any comments on it at this point? Or would you consider it after the next quarter? Just wanted to get that out there.

Terry Coelho -- Chief Financial Officer

Scott, so it's a good question. I think at this point in time, we have a lot of confidence in our brands. We're really pleased with how this quarter has progressed and how the business continues to progress through this period of uncertainty. But we really do feel it's important to provide guidance when there is more certainty about the future. And if anything, some of the recent trends with the pandemic don't give us that full set of confidence. So we'd love to be able to come back and give it as soon as we feel it would be appropriate to do so.

Scott Henry -- ROTH Capital Partners -- Analyst

Okay. Fair enough. Second question, severance, $5 million seems like a large number. Any comments on why that number was of that magnitude?

Terry Coelho -- Chief Financial Officer

So it's -- that was the number. It's a combination of cash and stock compensation. It is associated with the contract that was -- that [Indecipherable] had in place.

Scott Henry -- ROTH Capital Partners -- Analyst

Okay. I guess staying on the income statement, the operating expense saving is significant. I know you've mentioned that before, roughly the $3.5 million. How much of that do you think was in G&A versus selling expenses? If you could estimate that.

Terry Coelho -- Chief Financial Officer

So yes. So I would say probably about half and half. Obviously, T&E is a component of spend in both parts of the business. And as I mentioned before with the other question that came in, we did see lower travel with both, but obviously, we have a bigger sales force than management. But there were savings across both areas. I think we -- typically, early in the year, you -- to kick off some of the marketing initiatives, you tend to spend a little bit heavier in the first quarter. And so that wouldn't have come in as much in the second quarter, and we've delayed some initiatives, as I said before. So it's probably a mixture. It's a mixture.

Scott Henry -- ROTH Capital Partners -- Analyst

Okay. And Terry, the final question for you as I was just getting through the income statement. You're starting to stack together a lot of positive earnings quarters. At some point, the accountants will tell you to expense for taxes, whether you're paying them or not. When would you expect to start reporting on a fully tax basis?

Terry Coelho -- Chief Financial Officer

So we have quite -- we have well over $250 million of NOLs out there. So I think you wouldn't see us having to pay taxes for -- federal taxes certainly for quite some period of time.

Scott Henry -- ROTH Capital Partners -- Analyst

But if I recall, a couple of years on the accounting side, won't you have to -- at one time, you'll book a one-time gain for that, and then you'll report on a continuing ops basis tax. Perhaps we can take that offline, but I believe that's the problem.

Terry Coelho -- Chief Financial Officer

Yes. We can -- let's follow up on that offline.

Scott Henry -- ROTH Capital Partners -- Analyst

Okay. Shifting over to Scott. Scott, it sounds like in 2Q, the sales reps were running at about a 60% to 70% relative productivity rate based on the numbers you gave. Where do you think that is in real time? I mean, obviously, they're not going to be back up to 100% yet, but are they making gains sequentially from 2Q to Q3? I imagine they are. And I'm just curious the magnitude of that?

Scott Plesha -- President and Chief Commercial Officer

Yes. No, I appreciate the question, Scott. So we were very thoughtful as part of our COVID committee in evaluating when to kind of stagger the release reopening of territories. So it was very gradual through May and June, actually June. And then in early July, was the first time we were 100%, all territories open. I guess in my opening comments, we talked -- I talked a lot about the hybrid role, and Jeff mentioned as well. I think what we've done here is we realize we're not in this environment and forever long at last. We're probably not going to have the same number of face-to-face visits as we once had. We're really encouraged that, that number has gone up each week, the last -- except for the Holiday week, 4th of July week, but we've seen it go up and it's now well over 50% of the face-to-face visits we had pre-COVID. But with all the other systems we built, we have the ability to present to HCPs virtually over Webex, where we can share materials in a compliant manner. We have a dedicated email portal with information we can send. And then text messages, we've done virtual speaker programs.

There are a lot of different ways we're educating. So our thought process was, if we're not going to get the same number of face-to-face, we need to build a platform that can pivot. And it's different across each territory and each office has different protocols even and maybe how often we can go in. So we're encouraged by the fact that we blend together, everything our sales force is doing. We actually are getting more touch points than we were previously. Now, we do believe face-to-face matters. We've seen that. Jeff touched on, we had a small expansion early in Q1. And that group actually grew at twice our national average from Q1 to Q2. So plugging in some new individuals into territories that were a little bit underserved, we saw a nice return. So I think going forward, it's going to be a blend. We feel we have -- besides just what the reps are doing, we've also augmented with marketing programs, also a lot of digital work as well, whether it's banner ads, where HCPs are located. We have a Facebook page now for patient access, things like that. So all these things kind of blend together to be able to adapt depending on what's going on in the world in each individual territory. Hopefully that helps.

Operator

We will now move to our next question from David Amsellem from Piper Sandler. Please go ahead. Your line is open.

Zachary Sachar -- Piper Sandler -- Analyst

Hi, everyone. This is Zach on for David. Thank you for taking my question. Just a quick one for me on Symproic, and sorry if I missed this. But we were just hoping to get some color on what you guys kind of need to do to gain share for the product specifically to gain share on Movantik. Thank you.

Scott Plesha -- President and Chief Commercial Officer

Hi, Zach, it's Scott. Appreciate the question. And one of the key things, I believe, and we announced a couple of small wins today. But since we got the product back, one of the things early on was we had market access that was average. We did have access in certain plans, but we've done a really nice job in Q1 actually, end of last year and early this year of adding some really large payers with CVS. We were disadvantaged within CVS and now we're basically on equal status as Movantik, and you see our market share grow. Literally, it's up over 40% since that change in early 2020. Same with Prime Therapeutics, where we've basically more than doubled our business in two quarters.

So we're going to keep chipping away at the market access side of things there. I think it's a marketplace that's very sensitive to market access. And we'll also look to implement some different marketing programs here over the next quarter or two as well to accelerate the growth. Again, in my opening comments, it's meant to be a complementary product. We believe we can continue to grow it. But we also are mindful that BELBUCA will be first and Symproic is second. We don't want to lose BELBUCA momentum or a BELBUCA call at the expense of the Symproic call as well. So trying to balance those two things. But I believe based on some of the things I mentioned earlier, we'll keep moving the ball forward and continue to take market share.

Zachary Sachar -- Piper Sandler -- Analyst

Great. That makes sense. Thank you.

Scott Plesha -- President and Chief Commercial Officer

You're welcome. Thanks, Zach.

Operator

We will now move to our next question from Tim Lugo from William Blair. Please go ahead. Your line is open.

Timothy Lugo -- William Blair & Company -- Analyst

Thank you for taking the question. Can you broadly talk about price. It seems like the industry has settled into a pretty regular pricing dynamic. However, there's obviously been costly disturbances around the pandemic, whichever one is [Indecipherable] there's also been some inventory fluctuations. I guess, what's your kind of thinking around price and maybe being more aggressive there or maybe even just less predictable?

Jeffrey A. Bailey -- Interim Chief Executive Officer

So it's difficult, obviously, to discuss price. I think it's one where we look at it on a regular basis and what's appropriate for the market and where the broader landscape is. So I really don't have any other [Technical Issues] comment to take beyond that. I don't know, Terry, if you have any additional comment that you'd like to add as well.

Terry Coelho -- Chief Financial Officer

Sorry, I was on mute. So I think on pricing with what we've tended to look at, we feel like there's a balance that you're considering every time. And when you go -- if you take a higher price increase, you run into price protection on different contracts. You run on to Medicaid impacts and best price, things like that. So we tend to say, let's make sure we're pricing appropriately. And basically being able to take advantage to the full -- on a net basis as much of the price increase as we can. But we've -- I think you've seen us now typically once a year doing a price increase. And Scott, I think you would agree that we feel that, that's appropriate.

Scott Plesha -- President and Chief Commercial Officer

That's correct. I think our price increase we took early this year was 5%, we're able to realize most of that based on the contracts we have in place.

Timothy Lugo -- William Blair & Company -- Analyst

Okay. Fair enough. And maybe for Sunbelt, obviously, an important region for most of the class. Can you talk about just kind of what is -- what does the reason look like on the ground right now, we obviously, have some weather down in Florida? And are we seeing any compounding effects? And was anything more consensus during the quarter than maybe the March time frame?

Jeffrey A. Bailey -- Interim Chief Executive Officer

You referenced you'd like to know the different market dynamics evolving during the pandemic and with the weather, that's what you're referencing, I assume.

Timothy Lugo -- William Blair & Company -- Analyst

Yes. Yes. Obviously, COVID has been impacting the Sunbelt during the quarter and now we have some weather. So I was kind of hoping for maybe some real-time comments?

Jeffrey A. Bailey -- Interim Chief Executive Officer

Yes. So let me go first, Scott, maybe you jump in, but [Technical Issues] have what we assessed and the field input, customer inputs every week and also with other companies as far as benchmarking, what's going on in different regions of the country. So it's a [Technical Issues] it's not one size fits all, which I think you're referencing. And also how we're approaching the market in a different area, they can vary from week-to-week based on how the pandemic is doing in general. But [Technical Issues] is true is that I know something I'll be repetitive from what I said before, but people do make a difference. And what we're finding there's -- no matter if [Technical Issues] face to face with the customer or not or finding is that virtual or face to face, the combination between the two and the activity does make a difference.

And so that's why we're still very focused on making sure we understand the regional differences to your point, which is a really good point. It's one where we you recognized that early on that it's not one size fits all, but how we're playing the game as far as locally, it varies. And it's something that we have to stay on top of. And we will continue to stay on top of going forward with the different dashboard metrics we have in place, but also the regular weekly venue, [Technical Issues] make sure we're on top of that. Scott, do you have anything else you want to add to that?

Scott Plesha -- President and Chief Commercial Officer

I think it's well covered, Jeff. It is variable from territory to territory. And I think I'm going to go back to -- we've -- I think we've built a platform that allows our reps to pivot based on the needs, not in just -- not just territory level but HCP level. And one of our marketing goals is to have something a different venue or different touch point that we can provide almost on a monthly basis, especially if it's going to happen at a distance to interact with HCP. So something different to grab their attention and interact with them, even if it's a minor change or a point to share. So we're working closely as a complete commercial team to make sure we have the right tools in the rep's hands.

Timothy Lugo -- William Blair & Company -- Analyst

Thank you.

Scott Plesha -- President and Chief Commercial Officer

Thanks, Tim.

Operator

We will now take our last question from Matt Kaplan from Ladenburg Thalmann. Please go ahead. Your line is open.

Matthew Kaplan -- Ladenburg Thalmann -- Analyst

Hi, guys. Good morning. Thanks for taking the questions. And just wanted to follow up on a couple of the prior questions in terms of -- looks like you successfully kind of entered into addressing the pandemic issues that caused a dislocation there? And can you help us understand in terms of when we should expect kind of a return to growth of revenues with respect to BELBUCA and Symproic both, given the kind of the pandemic dynamic that we're seeing right now? And what you're seeing on the ground right now?

Scott Plesha -- President and Chief Commercial Officer

Thanks for the question, Matt, it's Scott. So we talked a lot about the patients returning in new-to-brand. And had I shared earlier, to be more specific on the numbers, we were seeing just under 1,200 new patients a week for the 4 weeks in February. That fell down to about 900 in April and May. And we're encouraged that June, the NBRx is there averaged 1,073, already kind of bouncing back and the market looked like that as well. Last data point we have, it's one data point, but NBRx share was 7.8%. So it was a nice bump-up for us. We're not going to just rely on the market, though, to recover completely. We realize we're going to need to grab more share. We're implementing -- we've implemented already three different things, I think, will help impact NBRxs. First is the prior authorization hub. So we want to help patients get through the prior authorization process, if necessary, especially if offices are understaffed. And then we've enhanced our co-pay card program, which reduces the maximum amount of pocket for patients.

And we think as patients are financially stressed during this time, it may help them. First off, stay on the product if they're a current user, but also may make it easier for people to start, and we actually have heard many examples of that. And then we've also literally just kicked off this week, a new-to-brand program whereby, we're reducing or limiting financial commitment by a patient, their first prescription. So -- and we're -- this is meant to augment what we're doing, and it's not going to be for every new patient. But I do think, obviously, it has to be commercially only and compliant. But I do think, literally, what we've demonstrated with the levels we were at, we still had growth. If we want to accelerate that growth, we need to raise the NBRxs in the coming quarters. And we believe we have the plan in place to do that.

Matthew Kaplan -- Ladenburg Thalmann -- Analyst

Okay. Thanks, Scott, that's very helpful. And then a question for Jeff in terms of -- you mentioned that you've beefed up the BD element of the business. Can you maybe detail some of -- for some of us your BD goals for the remainder of 2020 and looking into the first half of 2021?

Terry Coelho -- Chief Financial Officer

Jeff?

Scott Plesha -- President and Chief Commercial Officer

I don't know, Jeff may have dropped.

Terry Coelho -- Chief Financial Officer

He may have -- he's been having some connectivity problems. Maybe we can follow up on that in our follow-up call.

Matthew Kaplan -- Ladenburg Thalmann -- Analyst

Yes, that would be great. Okay. Thanks guys. Thanks a lot, Scott.

Scott Plesha -- President and Chief Commercial Officer

Thanks, Matt. Appreciate it.

Operator

[Operator Closing Remarks]

Duration: 65 minutes

Call participants:

Terry Coelho -- Chief Financial Officer

Jeffrey A. Bailey -- Interim Chief Executive Officer

Scott Plesha -- President and Chief Commercial Officer

Brandon Folkes -- Cantor Fitzgerald -- Analyst

Oren Livnat -- H.C. Wainwright -- Analyst

Gregory Fraser -- Truist Securities -- Analyst

Scott Henry -- ROTH Capital Partners -- Analyst

Zachary Sachar -- Piper Sandler -- Analyst

Timothy Lugo -- William Blair & Company -- Analyst

Matthew Kaplan -- Ladenburg Thalmann -- Analyst

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