Neuronetics, Inc. (STIM) Q2 2022 Earnings Call Transcript

Neuronetics, Inc. (STIM -6.67%)
Q2 2022 Earnings Call
Aug 02, 2022, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day, and thank you for standing by. Welcome to the Neuronetics report second quarter 2022 financial and operating results conference call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session.

[Operator instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker today, Mark Klausner, please begin.

Mark Klausner -- Investor Relations

Good morning, and thank you for joining us for Neuronetics' second quarter 2022 conference call. Joining me on today's call are Neuronetics' president and chief executive officer, Keith Sullivan; and SVP, chief financial officer, and treasurer, Steve Furlong. Before we begin, I would like to caution listeners that certain information discussed by management during this conference call will include forward-looking statements covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements related to our business, strategy, financial and revenue guidance, the impact of COVID-19, and other operational issues and metrics. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business.

For a discussion of risks and uncertainties associated with Neuronetics' business, I encourage you to review the company's filings with the Securities and Exchange Commission, including the company's annual report on Form 10-K and Form 10-Q, which will be filed later today. The company disclaims any obligation to update any forward-looking statements made during the course of this call, except as required by law. During the call, we'll also discuss certain information on a non-GAAP basis, including EBITDA. Management believes that non-GAAP financial information, taken in conjunction with US GAAP financial measures, provides useful information for both management and investors by excluding certain non-cash and other expenses that are not indicative of trends in our operating results.

Management uses non-GAAP financial measures to compare our performance relative to forecast and strategic plans, benchmark our performance externally against competitors, and for certain compensation decisions. Reconciliations between US GAAP and non-GAAP results are presented in the tables accompanying our press release, which can be viewed on our website. With that, it's my pleasure to turn the call over to Neuronetics' president and chief executive officer, Keith Sullivan.

Keith Sullivan -- President and Chief Executive Officer

Good morning, and thank you for joining us. I'll begin by providing an overview of the second quarter's performance, followed by an operational update. Steve will then review our financial results. I'll conclude with our thoughts for the balance of 2022 before turning to Q&A.

Starting with the financial review for the second quarter, total revenue was $16.3 million, up 15% over the second quarter of 2021. Our strongest revenue performance since the fourth quarter of 2019 and our second straight quarter of mid-teens growth. The encouraging performance was primarily driven by robust capital equipment sales, a solid uptick in utilization, and gaining momentum built on our marketing programs. Despite broad, macro, and market disruption, we saw a marginal impact on our business, which we attribute to our team who has stayed ahead of the shifting environment.

US NeuroStar System revenue was $4.4 million, up 70% over the second quarter of 2021, representing 20% growth over the last quarter and our fifth consecutive quarter of sequential growth. This was fueled by the conversion of a strong pipeline created by our capital sales team, which led to the highest systems sales in three years. This was made possible in part by our quarterly NeuroStar Summits, which boost sales not only during and immediately following the event, but also 6 to 9 months that follow. US treatment session revenue was $11.3 million, up 5% over the second quarter of 2021.

Growth was a result of improving utilization rates attributed to the increasing traction of marketing programs, including the Tap into a New Possibilities for depression digital campaign, which has garnered over 144 million impressions since its launch on March 3rd. And our partnership with Drew Robinson achieved hundreds of millions of new impressions, and other initiatives we have put into place over the last 24 months. During the quarter, overall utilization was up 7% year over year, with per click utilization increasing 15%. Offsetting the strong utilization trend with some softness related to the merger of our two largest customers, which seems to have disrupted their typical operations during the quarter.

Now turning to operational highlights. Throughout the first half of 2022, we have focused on four areas to drive the growth of the organization. First, increasing customer and patient awareness. Our quarterly NeuroStar Summit was held in Atlanta, which was once again completely sold out and included over 50 prospective customers.

We will continue to host these events throughout the year with our next summit taking place in Charlotte, North Carolina, during the third quarter. One key driver of performance during the quarter and year-to-date was the continued advancement and optimization of our education and awareness programs. The main focus of these programs is to build and grow a successful NeuroStar practice within our customers' existing operations. We know many potential NeuroStar patients exist within these practices today and need to be educated about our technology and its benefits.

We are seeing real progress with both our awareness campaign and the PHQ-10 tool, as our sales force has had more time to socialize and implement with our existing customers. Our PHQ-10 tool is gaining traction on a daily basis and continues to be a highly productive tool within the practices where it has been rolled out. We continue to push to have this tool introduced in an increasing number of practices to maximize its impact. As an example of the type of benefit that this tool can have, we recently launched the PHQ-10 within a single large customer in the South East, within just 2 hours, the practice performed 27 assessments, and the site generated over 12 potential patients looking for a non-drug alternative for their depression.

We look forward to continuing to optimize the tool and bringing it to a greater percentage of our customer base. In the second quarter, we completed the construction of NeuroStar University or NSU in Charlotte, North Carolina. This revolutionary training center will be used to teach new and existing customers how to become NeuroStar experts, connect with other specialists in their field and grow their practices using clinical education and advanced marketing and consultation techniques. The NSU curriculum has been developed to deliver an immersive experience, providing attendees with a deep understanding of our five-star program.

As a result, we expect to see an improved patient experience and accelerating growth from customers who attend. Our second focus area is the continued optimization of our commercial organization. We have seen the positive impact of the addition of three regional practice managers last quarter, which brought the total to seven. With smaller teams covering smaller geographies, we have been able to provide better service and more frequent coaching to our customers.

Going forward, we will hire new managers as needed. Our third focus area is growing the number of exclusive commercial partnerships. We recently initiated a partnership with Alleviant Health Centers, an Arkansas-based network of full-service mental health clinics. Under the agreement, Neuronetics will be the exclusive supplier of new TMS equipment to Alleviant and its affiliates.

Alleviant who previously used competitive systems elected to switch to NeuroStar after attending our most recent summit. They made the change because of our ongoing support, training, and marketing initiatives. Their purchase of several systems will help expand their footprint across multiple states. As many of you are aware, our two largest national accounts merged in July, which speaks to the promise of the TMS market and solidifies NeuroStar's leadership position.

This new entity will give NeuroStar an even bigger footprint and be supported by shared operational expertise and patient marketing capabilities, which we believe will help drive growth across approximately 245 NeuroStar Systems in over 200 sites. Lastly, I want to provide an update on our clinical and regulatory progress. In May, we received FDA clearance for NeuroStar as an adjunct treatment for adult patients suffering from obsessive-compulsive disorder. Importantly, this new indication can be remotely enabled on our customers' existing NeuroStar Systems at no charge.

Our two-stage launch is currently underway. During the quarter, we identified 40 practices for the limited pilot, and in early July started training at these sites. And are in the process of optimizing the clinical, and marketing, and commercial aspects of OCD. The next phase of our launch is on track and expected to begin in the fourth quarter of 2022.

We will then start to roll out this indication to all of our customers. Subsequent to the end of the quarter, we also received clearance from the FDA for a new NeuroStar indication to treat anxiety symptoms for adult patients who suffer from MDD, also known as anxious depression. Importantly, this submission to the FDA leverages real-world data from TrakStar, our exclusive database of patient outcomes. This database includes over 134,000 patients who have completed more than 4.8 million treatment sessions.

With this new indication, we will be able to present data to physicians from over 1,200 patients across numerous studies which consistently show that NeuroStar can improve anxiety symptoms in MDD patients. This new indication does not require any additional clinical training and is covered under the current reimbursement codes and coverage policies. Anxiety symptoms are seen in a sizable portion of MDD patients, estimated to be more than 50% prevalent. These anxious depression patients are more prone to experience severe depression and suicidal thoughts.

In addition to these recently cleared new indications, we have just submitted a novel method to speed up and improve the effectiveness of our motor threshold process for both patients and healthcare professionals. This new product is patent pending and upon FDA clearance, we'll be compatible with the entire installed base of NeuroStar Systems. We anticipate releasing additional information on this update later this year. Over the last two years, we have significantly expanded our indications for use to include OCD and anxious depression.

Our ability to deliver this rapid expansion of indications is largely due to our ability to leverage the huge repository of real-world data collected in TrakStar to efficiently and effectively receive clearances. This validates the FDA's willingness to include real-world data in clearance decisions. Because of this, we continue to view TrakStar as an incredibly powerful tool, which our clinical and regulatory teams will continue to use to engage with the FDA to advance our regulatory strategy and potential new indications. Before turning the call over to Steve, I wanted to provide an update on the recent progress made regarding reimbursement.

As announced in mid-July, there is a series of healthcare policy updates announced that increase patient accessibility to NeuroStar. These policy updates include First Coast and Novitas Medicare administrative contractors that are changing local coverage, and determination to reduce the number of prior medication failures for TMS eligibility from four down to one for patients suffering from MDD. First Coast coverage area includes 2 million Medicare beneficiaries, more than 74,000 physicians, and 247 hospitals that serve Medicare patients. Novitas coverage includes over 8 million covered lives in over 10 states.

There is also an additional proposed change that could remove the requirement for a previous psychotherapy trial. We also have received a number of other positive policy decisions related to both MDD and OCD, including Highmark Blue Cross Blue Shield publishing coverage for OCD, affecting 6.9 million members. Select Health published their first TMS policy for MDD, which impacts 981,000 members, and Pacific Source removed the MDD pre-authorization requirement for their Medicare Advantage plan members. Overall, I am very pleased with our performance throughout the first half of 2022.

Despite the macro changes that have impacted healthcare providers and their patients, we have continued to execute. The ongoing positive customer and patient reactions confirm that our commercial, clinical and regulatory strategies are working. This is largely due to our hard-working and committed employees who have kept us ahead of the current complexity of the operating environment. We look forward to continuing to help our customers provide treatment to their patients suffering from mental health disorders.

With that, I'd like to turn the call over to Steve.

Steve Furlong -- Chief Financial Officer

Thank you, Keith. Total revenue for the second quarter was $16.3 million, an increase of 15% over the second quarter 2021 revenue of $14.2 million. US NeuroStar Advanced Therapy System revenue was $4.4 million compared to the prior year's revenue of $2.6 million it was up 70%. The increase was primarily driven by a strong capital pipeline, a maturing Salesforce, and NeuroStar Summits.

In the quarter, the company sold 59 systems, up from 36 systems in the second quarter of 2021. US treatment session revenue was $11.3 million, an increase of 5% over the second quarter of 2021 revenue of $10.8 million, driven by an increase in treatment session volumes relative to the prior year. Specifically, an uptick in per-click customer utilization. In the second quarter of 2022, revenue per active site was approximately $11,300 compared to approximately $12,000 in the prior-year quarter.

As a reminder, we calculate this metric by dividing total US treatment session revenue by the beginning of quarter active sites. The gross margin was 75% compared to the second quarter of 2021 gross margin of 81%. The decline was due to the increase in NeuroStar capital mix year over year. Operating expenses during the quarter were $22.1 million, an increase of $4.1 million compared to the second quarter of 2021.

The increase was primarily driven by the implementation of new marketing initiatives, costs related to our expanded sales force, and increased costs from inflationary pressures. During the quarter, we incurred approximately $2.2 million of non-cash stock-based compensation expenses. The net loss for the second quarter of 2022 was $10.4 million or $0.39 per share, as compared to a net loss of $7.5 million or $0.29 per share during the second quarter of 2021. EBITDA for the second quarter of 2022 was negative $9.1 million, as compared to a negative $6.3 million for the second quarter of 2021.

Moving now to the balance sheet. As of June 30, 2022, cash and cash equivalents were $70.9 million. Subsequent to the end of the quarter, we collected $10.5 million in loan principal following the completed merger of Greenbrook and Success TMS. Now turning to guidance for the full year of 2022, we now expect revenue in the range of $60 million to $62 million.

For the third quarter of 2022, we expect revenue of $14.5 million to $15.5 million. We continue to expect to see year-over-year growth in each of the remaining quarters, along with a more normalized seasonal pattern with a slowdown in the third quarter before a strong fourth quarter, which is typically the largest of the year. We now expect total operating expenses for the full year 2022 to be in the range of $86 million to $88 million as a result of cost justification initiatives. I would now like to turn the call back over to Keith.

Keith Sullivan -- President and Chief Executive Officer

Thank you, Steve. We are very optimistic about what the second half of 2022 will bring. Our focus will remain on increased customer and patient awareness, the continued optimization of our commercial organization leveraging exclusive commercial partnerships, and clinical and regulatory progress. I'm extremely confident in our team's ability to take advantage of this opportunity that lies ahead to help treat the growing number of patients suffering from mental health disorders The reason we are the market leader in TMS therapies for mental health disorders is that we have been able to build a team made up of industry best and brightest.

And I would like to thank each and every one of them for their dedication and commitment to delivering innovative solutions for patients. With that, I'd like to open the line for questions.

Questions & Answers:

Operator

[Operator instructions] And our first question comes from Adam Maeder of Piper Sandler. Your line is open.

Adam Maeder -- Piper Sandler -- Analyst

Hi. Good morning, Keith, and Steve. Thanks for taking the questions here, and congrats on the progress. Solid treatment number, and utilization improvement in Q2, I think you did note some softness around your two largest customers.

Greenbrook and Success due to the pending merger. Just wondering if you're able to give any more color on volumes there. It sounds like the treatment number could have been even better if not for this transient headwind. And then, how do you expect volumes at this newly created entity to trend in Q3 and Q4? And, I had a follow-up, or two.

Thanks.

Keith Sullivan -- President and Chief Executive Officer

Well, thanks, Adam. I think it's natural that when two companies are going through a merger that they're going to experience some disruption. I have full confidence that the combination of Success TMS, and Greenbrook is going to be a huge winner. So I think that this -- I see this blip as temporary.

And I think that it may continue as they go through their integration for the next few months. But at the end of the day, it's going to be a winner for them, for us, and the whole industry. So I don't see it as a big deal.

Adam Maeder -- Piper Sandler -- Analyst

OK. That's helpful, Keith. Appreciate that. And then maybe just to flip over to the system side.

So really. Strong capital quarter, maybe just talk a little bit more about what drove the strength there. It sounds like a pretty good pipeline conversion. And then as we look ahead, how do you think about the capex environment just given some of the macro landscape? I think you previously talked about 200 or 250 systems per year as being a good framework for models.

Just wondering if that still holds.

Keith Sullivan -- President and Chief Executive Officer

So, they -- I think we started talking about it last year when we brought on the new team that said they started with pretty much a zero pipeline and it would build over the quarters and it has. We started out with 24 systems in Q1 of last year and built every quarter since then. So I think we have a robust pipeline right now. It continues to grow through the efforts of our great marketing team and through the NeuroStar Summits that we have.

So, I know that there's softness in the economy, but currently, we have a pretty strong pipeline with backups to it. So we're pretty confident that 240 to 250 is still a good number for us.

Adam Maeder -- Piper Sandler -- Analyst

OK. Great and good to hear. And maybe if I can just squeeze in one last one, I'll ask about First Coast and Novitas, and the proposed policy updates there. Do we know exactly when we'll get a final decision, i.e., if those will become a kind of official policy? And then would you expect other maps to follow Novitas in some ways, kind of looked at as a bellwether, so maybe just kind of level set us on the situation there and any potential impact to the business? Thanks again, and congrats on the progress.

Keith Sullivan -- President and Chief Executive Officer

Thanks. I really can't tell you whether the other MACs are going to follow. If we look at history, they have. So we're hoping that it goes across the board.

When all of these things become final they have a review period and then they have a question period and then they make it final. So we're hoping that all of the changes become put into place, hopefully by the end of the year.

Adam Maeder -- Piper Sandler -- Analyst

Perfect. I'll leave it there. Thank you.

Keith Sullivan -- President and Chief Executive Officer

Thanks.

Operator

Thank you. And our next question will come from Margaret Kaczor of William Blair. Your line is open.

Margaret Kaczor -- William Blair -- Analyst

Hey, good morning, everyone. Thanks for taking the questions. Maybe just a good picture at the start. In other words, it kind of takes this quarter, to work inside [Inaudible] which works as the regulatory player.

I'm trying to put out next quarter updates. Adam, can you give us some context, I guess for when will start to impact more materially, especially on that utilization, maybe revenue per system side? And I'm just trying to get a sense is kind of step one, in terms of laying the foundation or for a long in which of those updates is the most [Inaudible]?

Keith Sullivan -- President and Chief Executive Officer

Margaret. We couldn't hear you very well. It was a little garbled. So are you able to repeat the question?

Margaret Kaczor -- William Blair -- Analyst

Sure. Can you hear me any better?

Keith Sullivan -- President and Chief Executive Officer

A little. Give it a shot.

Margaret Kaczor -- William Blair -- Analyst

Keith, can you hear me?

Keith Sullivan -- President and Chief Executive Officer

Yes, we can.

Margaret Kaczor -- William Blair -- Analyst

OK. I just want to get kind of talk about the updates that we heard this quarter, you put on so many [Inaudible] kind of marketing commercial regulatory [Inaudible]. Can you give us some context of where they're impacting the growth, specifically utilization growth, and revenue per system growth will occur? And is there one of these that you can give more in your view of today's metrics?

Keith Sullivan -- President and Chief Executive Officer

Yeah, it's a good question. I think the utilization growth and the revenue growth are really coming out of our marketing efforts. Utilization growth and revenue growth really come out of our marketing efforts, and our PHQ-10s. And our focus on patients within the practice rather than patients coming out of the airwaves.

I think that with -- as we said in the prepared remarks, there are plenty of patients that have failed two to four drugs within the practices. And the physicians have not been very good at being able to speak to them and educate them and then convert them to NeuroStar patients. So, I would say that if I look at what makes the biggest impact for us, it's our marketing efforts within the practice, it's our marketing efforts surrounding the practice and our PHQ-10. And similar to the growth in our system revenue, we anticipate that with each quarter, our revenue has continued to grow on the treatment session side.

And quite honestly, there is a little bit of buying patterns that we have to change within our practices. Some of them are used to buying on a per-patient or even a partial-patient basis. And we are, through our programs working to really align their purchasing with our quarter and with our programs.

Margaret Kaczor -- William Blair -- Analyst

OK. That's helpful. Maybe to follow up a little bit more on the capital side as well. Obviously, a great number [Inaudible] sales reps that have to be, number on the capital side [Inaudible] seems like it's almost the systems throughout this quarter.

So as we look forward, what do you think is a good number there should be, maybe what's being assumed guidance for the second half of this year? Thanks.

Keith Sullivan -- President and Chief Executive Officer

So we're still targeting the 240 to 250 systems for the year. I think we're on track to do that. I said the last couple of quarters that if we're able to get 45 to 50 systems every single quarter, we're good. This quarter, we got higher than that.

And, I do want to be cautious in that we have to be able to train them and make sure that we get them up and running. And I think at the current levels even at 59 for this quarter, I think we can focus our efforts and our teams and make sure everybody gets the attention they need.

Margaret Kaczor -- William Blair -- Analyst

Great. Thank you, guys.

Operator

And our next question will come from William Plovanic of Canaccord Genuity. Your line is open.

William Plovanic -- Canaccord Genuity -- Analyst

Thanks for taking my question -- yeah, great, thanks. Good morning. Thanks for taking my question. So a couple of questions here.

First, just capital sales robust, obviously, the pipelines filling, but also ASPs lifting. And was there anything onetime in the quarter? I mean, your ASP is getting close to 74,000, 75,000 systems. It's just this -- is this sustainable? Is this the impact of the kind of all the marketing programs and everything you've done in terms of the value add versus discounting to sell systems?

Keith Sullivan -- President and Chief Executive Officer

So, I think the programs that we have been talking about now for almost two years are gaining more and more traction, and I think we see it through our NeuroStar Summits. I mean, we are right up front with them talking about treatment sessions and -- but we then talk about every single thing that we do to help make them successful within their practice and outside of their practice. So, I think that at the end of the day, the price of the system and if it's $5,000 up or $5,000 down, it's negligible in the lease payment. So it's really not the issue for us.

So our ASPs have been going up steadily and we're -- I don't see that changing at all.

William Plovanic -- Canaccord Genuity -- Analyst

Great. And then -- thank you. And then, on the PHQ-10 tool, I mean, this sounds like it's been almost revolutionary for you. And, I think the commentary was you're getting great traction in the sites that are utilizing it.

So my question is how -- what percentage of your sites are utilizing the PHQ-10 today?

Keith Sullivan -- President and Chief Executive Officer

It's about 250 of our sites.

William Plovanic -- Canaccord Genuity -- Analyst

And how many total sites do you have again?

Keith Sullivan -- President and Chief Executive Officer

1,044.

William Plovanic -- Canaccord Genuity -- Analyst

So about a quarter of the sites. OK. Excellent. And then just lastly, in terms of the guide, it seems like you're bringing the quarter down.

It's not a big fourth quarter up from this quarter, is there something you're seeing or we should be thinking about or is this just given COVID and all the other headwinds out there, I just kind of want to make sure you bake everything in? And that's my question. Thank you.

Steve Furlong -- Chief Financial Officer

Hey, Bill, it's Steve. Historically, the third quarter is usually flat to slightly down compared to Q3. And so that was a component of our guide for the current quarter. And for the year, yeah, there are still lingering impacts with inflation and other factors.

But we did pull up the low end of the range from 58 to 60, so we're pretty confident with that midpoint right now.

William Plovanic -- Canaccord Genuity -- Analyst

Great. Thank you.

Steve Furlong -- Chief Financial Officer

You're welcome.

Operator

One moment. And our next question will come from Marie Thibault of BTIG. Your line is open.

Marie Thibault -- BTIG -- Analyst

Hi, Keith, and Steve. Thank you for taking the questions. I want to ask my first one here on the treatment session revenue per active site. I understand it was down a little bit year over year just because the installed base has been growing so quickly.

But if you were to exclude some of the softness around the Greenbrook and Success merger and sort of think forward to when some of this starts to catch up with the fast expansion installed base, what do you think is kind of the right growth for treatment session revenue per active site? Given utilization, I think was around 7% this quarter.

Keith Sullivan -- President and Chief Executive Officer

I think our revenue growth should be matching our utilization growth, which this quarter on a per click basis was 15%. So, I think it's harder for us to grow the fixed price accounts. So a lot of our efforts are going on to the per-click side of the business. And I think we expect that to grow at the 15% rate at least.

Marie Thibault -- BTIG -- Analyst

OK. Very helpful. And then you mentioned quite a few new initiatives, things like NeuroStar University, which sound exciting. How do you expect to sort of control spending in the back half given some of these new efforts? I think we're at about half of what you're expecting to spend on operating expenses for the year.

So maybe you can tell us about any puts and takes on that metric.

Steve Furlong -- Chief Financial Officer

Hey, Marie, it's Steve. Yes, so we just went through a pretty extensive forecasting exercise for the remainder of the year. It was really a reconciliation or a justification of what was in the budget and what the expectation is now. You saw, we did take down the high end of our opex and reduced the range a little bit.

I would say, if we didn't have some of the impacts of inflation and some higher costs related to COGS, that number would have been even lower. So I think, we're very comfortable with where we're at. The team is aligned with the new program spend and what we need to do from an R&D and clinical perspective. So we're pretty comfortable with that range right now.

Marie Thibault -- BTIG -- Analyst

OK.

Keith Sullivan -- President and Chief Executive Officer

And the NeuroStar University costs are all built into our budget that was planned.

Marie Thibault -- BTIG -- Analyst

OK, perfect. One last quick one, if I can sneak it in here. I don't think I heard you reiterate a target of either breakeven in 2024. Is that still a goal, something you're still working toward?

Steve Furlong -- Chief Financial Officer

Yes. Yes, it is.

Marie Thibault -- BTIG -- Analyst

All right. That's it for me. Thank you so much.

Keith Sullivan -- President and Chief Executive Officer

Thanks, Marie.

Operator

Thank you. And our last question will come from the line of Dave Turkaly, JMP. Your line is open.

Dave Turkaly -- JMP Securities -- Analyst

Great. Good morning. Keith, I know you're not going to want to answer this, but I'll try anyhow. With the two new indications, can you give us some thoughts in terms of even if it's 2023, I don't know, 2024, like what percentage of your mix are you planning on? I mean, could this be 5% or 10%? Additional on top of what you can do in MDD? Or how are you thinking about these new launches and their impact?

Keith Sullivan -- President and Chief Executive Officer

So, I think, our discussion around OCD has been that we would expect a few million dollars over the next few years. It's really an opportunity for our physicians to add opportunities to treat patients that are within their patient base that is battling OCD. So I don't anticipate it is going to be a majority, even 5% of our business. But it will be meaningful to the physicians that have patients who battle with OCD.

Our opportunity out there is really patients with depression and we're seeing it. And we're seeing them raising their hands and asking for help. And we're training our accounts on how to get to them.

Dave Turkaly -- JMP Securities -- Analyst

Got it. When you look at the protocol, I just want to confirm this. I think it's the same or very similar. And I think you mentioned in the release that insurers are sort of paying, I believe the same amount for these new indications, or at least for some of them.

And I imagine you charge the same. But just in terms of the actual positioning and the therapy. Are there differences or is it is this going to be pretty much just like MDD?

Keith Sullivan -- President and Chief Executive Officer

They use the same codes and patients with depression often suffer from anxiety also, so they use the same codes. There is a different motor threshold test for OCD and that's what we are educating our accounts on now. But outside of that, it's the exact same thing.

Dave Turkaly -- JMP Securities -- Analyst

And I guess lastly you mentioned, or I guess your slide, Joe mentioned it. For OCD, some of the other competitors need to buy something else. Does that -- are they treating something differently or are they targeting a different area in the brain, or why do they need that? And is that a big advantage for you?

Keith Sullivan -- President and Chief Executive Officer

They need codes. Some of our competitors need a second coil to be able to treat, and so the physicians have to buy that from them. For us, it's a software push and we're able to enable it remotely, but we are controlling that through the training. As we train them, we enable it on their system at no charge.

Dave Turkaly -- JMP Securities -- Analyst

Thank you.

Operator

I would now like to turn the conference back to Keith Sullivan for closing remarks.

Keith Sullivan -- President and Chief Executive Officer

Thank you, operator, and thank you for joining us on the call today. We look forward to updating you on our progress in the next quarterly call.

Operator

[Operator signoff]

Duration: 0 minutes

Call participants:

Mark Klausner -- Investor Relations

Keith Sullivan -- President and Chief Executive Officer

Steve Furlong -- Chief Financial Officer

Adam Maeder -- Piper Sandler -- Analyst

Margaret Kaczor -- William Blair -- Analyst

William Plovanic -- Canaccord Genuity -- Analyst

Marie Thibault -- BTIG -- Analyst

Dave Turkaly -- JMP Securities -- Analyst

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