Pear Therapeutics, Inc. (NASDAQ:PEAR) Q4 2021 Earnings Conference Call March 28, 2022 4:30 PM ET
Corporate Participants
Meera Murphy – Senior Director of Corporate Communications
Corey McCann – President & CEO
Chris Guiffre – Chief Financial Officer and Chief Operating Officer
Erin Brenner – Chief Product Development Officer
Yuri Maricich – Chief Medical Officer
Ronan O’Brien – General Counsel and Chief Compliance Officer
Julia Strandberg – Chief Commercial Officer
Conference Call Participants
Michael Cherny – Bank of America
Judah Frommer – Credit Suisse
Eric Percher – Nephron Research
Keay Nakae – Chardan
Charles Rhyee – Cowen
Marie Thibault – BTIG
Neena Bitritto-Garg – Citi
Operator
Good afternoon, everyone. Welcome to the Pear Therapeutics Fourth Quarter and Full Year 2021 Financial Results Conference Call. My name is Gigi and I will be your operator for today. Please note that all lines have been placed on mute to prevent any background noise. This call is being recorded. A replay of the webcast will be available in the investor section of the company’s website, approximately two hours after the completion of the call and will be archived for up to 30 days.
I’ll now turn the call over to your host, Meera Murphy, Senior Director of Corporate Communications. Meera?
Meera Murphy
Thank you, Gigi. On behalf of the Pear team, thank you for joining us today. With me today are Corey McCann, our President and CEO, Chris Guiffre, our Chief Financial Officer and Chief Operating Officer; Erin Brenner, our Chief Product Development Officer, Yuri Maricich, our Chief Medical Officer, Ronan O’Brien, our General Counsel and Chief Compliance Officer and Julia Strandberg, our Chief Commercial Officer.
To start the call, I’d like to turn it over to Ronan for the Safe Harbor statement.
Ronan O’Brien
Good afternoon. Please note that statements made during this presentation and our comments during this conference call, including statements concerning our future business, operating results or financial condition are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended. Information contained in these forward-looking statements is based on management’s current expectations, and actual results may differ materially from those indicated by these forward-looking statements, due to a variety of important factors. Additional information regarding these factors is included in our Annual Report on Form 10-K, and quarterly reports on Form 10-Q filed with the SEC, except as required by law, Pear assumes no obligation to update or revise these forward-looking statements, even if actual results or future expectations change materially.
With that, it’s my pleasure to turn the call over to Corey.
Corey McCann
Thanks, Ron, and welcome everyone to Pear’s first earnings call as a public company.
We are leaders in the digital health revolution. And we are proud of the role we’ve played in pioneering software as medicine. Multiple trends converge, creating tailwinds for digital health. Chronic disease continues to drive healthcare spending and burden millions of people. We are in the midst of a provider shortage where trained clinicians are unavailable to treat many prevalent conditions like addiction and behavioral health. Due to COVID-19, expectations for care have shifted toward remote settings and technology is pervasive in our lives.
Our contribution to the digital health revolution so far has been creating the category of software based medicines, also called prescription digital therapeutics or PDTs. Let me explain what a PDT is and how it works.
PDTs deliver clinically validated evidence-based therapeutic interventions through a smartphone or tablet anywhere at any time, providing the potential to remove the geographic and time bound barriers of traditional medicine.
Unlike pharmaceuticals, PDTs treat disease directly through software. Unlike wellness apps, PDTs pursue similar regulatory standards as pharmacotherapy in terms of safety, effectiveness, indications for use and quality.
PDTs must be developed under good manufacturing practices, tested in statistically significant randomized control trials, and authorized by regulators like FDA. PDTs also have the unique ability to collect real-world data for use by clinicians. Enhancing the connection between patients and healthcare providers.
PDTs can improve patient outcomes. They can enhance clinicians ability to deliver care, and they can save money for payers and the healthcare system. Today, we will introduce you to Pear’s vision and the opportunity before us.
We’ll move on to introduce our three commercial products and to describe the commercial inflection point we achieved in 2021. Then, we will orient you to our evidence generation into our pipeline of product candidates.
Next, we will discuss our dual platform, PearCreate, our discovery and development platform and PearConnect our commercial platform. We’ll also share our financial results and the performance metrics that allow you to track our progress toward the achievement of our mission. Finally, we’ll wrap up by answering your questions. That’s a lot of ground to cover. So let’s get to it.
As I mentioned, we start with Pear’s vision and the large opportunity we are pursuing. The vision has remained constant since our earliest days, but it has achieved higher resolution over time, especially in 2021. When Pear was founded nine years ago, we envisioned a world where software would be used to treat most of these conditions. It was obvious that technology would transform healthcare as it transforms everything. The question was not if, but when, and how.
The pandemic seems to have turned a digital health evolution into a digital health revolution. And PDTs are part of that digital health revolution. The space is exploding. And last year, our commercial success accelerated the emergence of PDTs as a mainstream medical treatment.
Within 2021, at the year one Pear, and therefore the entire PDT category achieved its first commercial inflection point. Pear achieved strong financial results and commercial progress from its portfolio of marketed products across key performance metrics of prescriptions, fulfillment rate, covered lives and revenue. We’ll discuss that performance later in the call.
We think Pear’s rapid acquisition of covered lives in 2021 driven by real-world outcomes data is a great reason to believe PDTs are here to stay.
We cannot think of a better way to measure the rapid derisking of the entire PDT category than with more than 30 organizations providing access to our commercial products and major coverage decisions from the likes of Prime Therapeutics, OptumRx and Massachusetts Medicaid. Our strategy to generate health economic data demonstrating cost savings in excess of product price is what we believe is key to driving coverage.
In addition, we generate advocacy, both from clinicians who are actively utilizing our products, and from patients and patient advocacy organizations who understand the benefit of our products.
In parallel, we generate streamline mechanisms for coding and payment. We’ve already seen this strategy gaining ground, and we will continue to execute until we see broad based payer coverage for PDTs. I’d like to share some examples of how others are now contributing to this coverage crusade.
The first is a milestone announcement last fall of the American Medical Association or AMA providing its new family of category one CPT codes to allow physicians to be reimbursed for their time spent monitoring and supplying FDA authorized online cognitive behavioral therapy technologies like our PDTs.
The second example is last month, the Centers for Medicare and Medicaid Services or CMS establish a new level two HCPCS code for prescription digital behavioral therapy. This code includes PDTs, such as Pear reSET, reSET-O and Somryst. The code is scheduled to become effective on April 1, 2022.
The third and final example I’ll share is the access to Prescription Digital Therapeutics Act introduced into Congress earlier this month. The bill which enjoys both bipartisan and bicameral support is enacted into law would expand fee for service Medicare coverage to include PDTs.
Some of our vision and opportunity with three quick observations. First, Pear defined the PDT industry, achieved early market traction with the first three PDT products and lay a strong foundation for commercial expansion.
We believe that many companies will join us in building the industry for the benefit of patients, providers and payers. And we believe that PDTs have the opportunity to quickly become mainstream medical treatments. We believe that five years from now PDTs will about and 10 years from now they will be ubiquitous.
Second, our business is enabled by competitive advantages like those obtained by life science and tech companies. Business features data, platform, regulatory and IP competitive advantages and presents the opportunity to create therapeutic like medical value with software like scale and efficiency.
At the first mover in PDTs, we see the opportunity for our company to deliver PDT after PDT, both via the dominant PDT creation engine, as well as the standard commercial platform for PDTs.
Third, adoption of PDT is accelerating, creating a major financial opportunity. Clinical trial data, real-world data, prescriber adoption and payer coverage, collectively make PDTs right for disruption of the medical complex. We believe the market opportunity for three FDA authorized PDTs is significant. The market opportunity for our current pipeline of 14 product candidates is even greater. And the market opportunity for the category is greater even still. We think PDTs are likely to transform healthcare. And we intend to be the company that leads this rapidly growing space.
Now, let’s turn to Julia, who will tell you more about our marketing products and who will share with you why we believe we achieved a commercial inflection point last year. Julia?
Julia Strandberg
Thanks, Corey. Greetings to all of our investors, analysts, employees and partners.
Substance use and opioid use disorders are chronic treatable diseases. And yet more than 20 million Americans struggle each year with these forms of addiction. Our product reSET is a 90-day FDA authorized prescription products for the treatment of substance use disorder. It’s the only product with a label for the treatment of addiction to cannabis, cocaine and stimulants. It’s also indicated for the treatment of addiction to alcohol when using combination with any of those substances.
Our product reSET-O is an 84-day FDA authorized prescription product for the treatment of opioid use disorder when used in combination with the pharmaceutical medication called buprenorphine. reSET-O is part of an innovative response to the opioid crisis in America, which was the number one public health care crisis in our country before the pandemic and which has only gotten worse due to the pandemic.
In fact, according to a recent report from the CDC, America’s addiction epidemic is the deadliest it’s ever been. More than 100,000 people died of drug overdoses in the United States during the 12-month period ending in April of 2021. This is up 28.5% from the same period a year earlier, and nearly doubled in the past five years.
Somryst is a 63-day FDA authorized prescription product for the treatment of chronic insomnia. In fact, it is the only product with a label for the treatment of chronic insomnia, which means that it has the opportunity to displace habit forming pharmaceuticals indicated for acute insomnia. It delivers CBT for insomnia called CBT-I in a convenient, standardized and accessible way.
Both the American College of Physicians and the American Academy of Sleep Medicine treatment guidelines recommend CBT-I as first line treatment for insomnia. But most patients never get CBT-I because there are fewer than 300 treating clinicians in the U.S. for about 30 million patients.
Clinical data for Somryst demonstrate a long-term durable improvement of insomnia, depression and anxiety symptoms out to 18 months unlike acute drug treatments, which have no durable effect.
Now I’ll share with you a few thoughts on why we believe that 2021 was the first commercial inflection point for Pear and the PDT category more broadly.
First, the number of patients benefiting from our products continues to grow. In 2021, we saw more than 14,000 prescriptions. We are starting to see refills of second and third prescriptions of reSET and reSET-O as providers look to keep patients engaged with treatment on their path to recovery. Approximately 60% of our prescribers prescribe refills to support a patient through their treatment journey. And the number of prescribers benefiting from our three products also continues to grow.
We believe the adoption of CPT and HCPCS code for the category reflects the evolution of the reimbursement ecosystem for PDT. As Corey mentioned earlier, the AMA announced category one CPT codes for remote therapeutic monitoring treatment management services. These codes along with the revisions that specify the reporting of cognitive behavioral therapy monitoring services, recognize the value of both PDTs and related physician services including setup, education and monitoring. Additionally, CMS established a new level two HCPCS code for PDTs including our three marketed products. The new code is scheduled to become effective on April 1, 2022.
Second, our fulfillment rate remain steady. at year end, we’re up to 51%. We expect our continued focus on integration into the digital provider infrastructure to further drive simpler prescribing and optimized fulfillment.
Third, the number of covered lives of our products continue to grow, unlocking access for more and more Americans and unlocking the revenue potential in the PDT business model. At year end, we had more than 31 million covered lives across more than 30 TBMs, commercial payers, employers and state organizations providing access by either listing on a formulary as a covered benefit or purchasing products in bulk. These organizations include the likes of Prime Therapeutics, OptumRx, The Health Transformation Alliance, the Hartford, and states such as Massachusetts, Ohio, Indiana, and Kentucky. Already this year, we’ve added Michigan and Oklahoma and a fortune 10 employer to our list of groups providing access to our PDT.
Fourth, our real-world evidence and healthcare economic outcomes are driving progress with payers. Pear published real-world HEOR data out to nine months for reSET-O. The data showed a net cost savings in excess of the product price. We made strong commercial progress in 2021 and I look forward to giving you updates each quarter moving forward.
At this point, I’m happy to turn the call over to Yuri who will talk to you more about our real-world evidence and health economic data, and then tell you about a couple of our 14 product candidates. Yuri, take it away.
Yuri Maricich
Thank you, Julia, and thanks to everyone joining this call.
Before I dive into our pipeline, as Julia noted, evidence and data generation is an important component to our market access strategy. We’ve made great progress with publishing both real-world evidence and health economic data over the last 18 months.
In addition to what we’ve already published in peer reviewed journal articles, in the next few months, I anticipate I will be able to talk about six months HEOR data for reSET, 12 months HEOR data for reSET-O, and 24 months HEOR data for Somryst. As you saw earlier this month, we have interim data coming out of our virtual real-world study of adults with chronic insomnia called DREAM, which was presented at the World CBT. Data are the waves that will bring PDTs that everyone shorts. The combination of RCTs, RWE and HEOR enable Pear to show value to key stakeholders be they patients, clinicians, provider organizations, regulators, or payers.
For example, are reSET-O RCT shows 82% of patients were retained in therapy, and 77% [indiscernible] abstinence. While real-world evidence data shows 88% abstinence at 12 weeks, and HEOR data shows a net savings of $2,708 over nine months. The ability to rapidly generate this continuum of evidence is a key competitive differentiator for Pear. We will dig further into real-world data next quarter.
For today, it’s my privilege to introduce you to our pipeline. We don’t have time to talk about each candidate. So I’ll orient you to our pipeline generally, and then shine a light on two candidates to give you a sense of what’s to come. Our pipeline is organized into three categories, psychiatry, neurology, and all others. The psychiatry category is the most advanced with three products on the market and other candidates in various stages of development. Our mission is to become a one stop shop for all conditions related to mental and behavioral health. And we see great opportunity for cross prescribing driven by our clinician dashboard. This category is headlined by our alcohol use disorder or AUD candidate and our product candidate for major depressive disorder or MDD. Both of which I will discuss in a moment.
The neurology category is a logical extension into another area of CNS disorders. Pain, for example, is well suited for treatment with a PDT because more than 15 million patients are left to choose between pain and treatment [indiscernible]. The last category is all others. We believe that PDT have promised across a range of therapeutic areas, including candidates in our pipeline targeting major markets like GI, oncology, and cardiovascular conditions.
Now let’s discuss our AUD and depression candidates. Our AUD program is a natural outgrowth of our success with reSET. As you may know, alcohol is in recess label when it is one of two or more substances of use. But the reSET label does not include AUD alone. We have data showing reSETs promise in this setting and we are developing reSET for patients with AUD only. We believe this label expansion has a good probability of success based on existing data.
In addition, if we obtained the label expansion, it would create a large market opportunity which is currently covered by our existing commercial field force.
Next, I’d like to mention our candidate for MDD. This is an area of enormous unmet need with more than 19 million Americans suffering from depression before the COVID 19 pandemic. Like AUD, it fits perfectly in the site category of our pipeline, allowing us to leverage our commercial infrastructure and allowing psychiatrist to cross prescribe via our clinician dashboard. In December, we announced two deals that allow us to incorporate promising digital therapeutic assets into our MDD candidate. Unlike other software-based treatments for depression, both of our assets have already demonstrated effectiveness in treating patients with MDD in randomized controlled trials. Leveraging those assets along with our digital biomarkers, we are developing a PDT candidate for use alone and/or in combination with pharmacotherapy to treat patients across the continuum of depression subtypes and severity.
The PDT candidate would then be evaluated in a potential pivotal clinical trial support FDA submission. It is a bit premature to announce plans for clinical trials, but I expect to be able to discuss specific plans with you before the end of the year.
At this point, I’d like to turn it over to Erin to talk to you about our dual platform. All yours, Erin.
Erin Brenner
Thank you, Yuri. And thanks to all of you joining us on today’s call. Pear is a platform-based product driven company. My job in the next several minutes is to give you a sense of Pear’s dual platform, PearCreate and PearConnect. PearCreate is our discovery and development platform. We use it to discover, develop and obtain approval for product candidates. In that regard, it has similarities to a biotech platform. Moderna is a biotech that used this mRNA platform to create multiple product candidates, one of which became a very important product, we believe that will not be the only product that comes from Moderna’s development platform.
We also believe that reSET, reSET-O and Somryst will not be the only products that come from PearCreate. The components of our PearCreate platform consists of our technology infrastructure, universal design system, asset aggregation capabilities, and content and component libraries.
In addition, we’ve built an integrated virtual and decentralized clinical study platform, as well as a health economic and real-world data engine to facilitate regular and timely evidence generation for Pear or a third-party PVCS. All of these capabilities have the potential to create leverage and scalability as we practice human centered design. PearConnect is our commercial platform. It connects PDTs with patients, providers, and payers. We use it to commercialize our product and we intend to make it available to other PDT companies, if they so choose. So that providers will have a unified platform on which to access PDTs. Whereas PearCreate looks a lot like a biotech company platform, PearConnect is a lot like a tech company platform. Think of PDTs as therapeutic products that are delivered to providers and payers in ways that resemble enterprise software.
Since I head up our product development teams at Pear, a big part of my focus is working with the team to streamline patient and provider journeys to build the infrastructure for the entire PDT category. EMR integrations, the Pear.MD clinician dashboard, our end-to-end patient service center and a data infrastructure configured to aggregate patient engagement, adherence and clinical outcome data are all part of PearConnect and PearConnect is gaining steam.
As an example, we announced last week that our PearConnect platform is now available to healthcare providers in the Epic App Orchard Gallery so providers can access the platform from within Epic leading EMR. We are working to make Pear a one stop shop for providers and payers to connect with PDTs for their patients. This gigantic vision inspires us and motivates us every day. And it is why we believe we are building more than just the company. We’re building the entire category. I look forward to updating all of you in future calls on Pear’s category creating platform build. Next, I’ll hand the call to Chris.
Chris Guiffre
Thanks, Erin. Before we jump to Q&A, I’ll cover financial results and a few operating metrics for which we provide guidance.
First, we forecasted 12,500 prescriptions for 2021. We generated more than 14,000. Second, we forecasted 50% fulfillment rate for 2021. We hit 51%. Third, we forecasted 30 million to 40 million covered lives for 2021. We delivered more than 31 million. Fourth, we forecasted 8% gross to net for 2021. It was 18% and the average price per paid prescription in 2021 across our three products was $1,306.
Going forward, we will not provide gross to net guidance, because we believe that prescriptions, fulfillment rate and covered lives are the key operating metrics. And we believe that GAAP revenue is the key financial results.
Now let’s turn from operating metrics to financial results. Our revenue forecasts for 2021 was $4 million. We generated $4.2 million. I’d like to take this opportunity to thank all of our Pear mates for standing together to deliver these strong results. Our diverse team could be the most important ingredient in our recipe for success. And diversity is one of our strengths. That diversity starts at our board, extends to our management team and permeates every level of the company.
Our Pear mates share a common denominator, which is that they are mission driven pioneers who love to innovate for patients. A few more 2021 metrics to know. First, at year-end, we had approximately $170 million on the balance sheet, which takes us well into 2023. Second, we recorded total operating expenses of approximately $35.6 million in the fourth quarter that includes approximately 1.4 million in non-recurring expenses related to going public in December. And finally, we had approximately 300 employees at year end.
This afternoon we issued a press release, which was furnished to the SEC under Form 8-K reporting our fourth quarter and full year 2021 results. We plan to file our Form 10-K for 2021 tonight.
Now let’s look ahead to our 2022 guidance. First 50,000 to 60,000 prescriptions; second 50% to 65% fulfillment rates; third 100 million to 120 million covered lives; and fourth $22 million in revenue. We believe we’ve shown strong execution so far as a public company, just as we did as a private company. Our track record of execution in 2021 allowed us to meet our revenue guidance for the year while building the capability to excel in 2022 and beyond.
Our track record of execution continued in the first three months of 2022 that includes recent announcements related to one payer coverage in Michigan and Oklahoma; two, availability of reSET and reSET-O in Spanish; three, a collaboration to potentially expand our sleep franchise in Japan; four, CMS establishing a HCPCS code for Pear’s PDTs; five, the introduction of federal legislation to make PDT is a covered benefit category; and six availability of our PearConnect platform within Epic’s leading EMR.
After the year we had in 2021, Pear and the entire PDT category are poised for growth. In fact, we believe that PDTs today have similarities with continuous glucose monitors, telehealth, liquid biopsies and monoclonal antibodies immediately prior to their massive commercial expansions. Those technologies were new and transformational, just like PDTs. As novel product classes, reimbursement was unlocked by real-world evidence and the establishment of bespoke billing and coding mechanisms.
Today, those healthcare technologies are commercial success stories with broad coverage from commercial and government payers. We believe that PDTs have the potential to transition from novelty to ubiquity and it is parents’ privilege to lead that charge.
With that, Gigi, let’s open the call for questions.
Question-and-Answer Session
Operator
[Operator Instructions] Our first question comes from the line or Michael Cherny from Bank of America. Your line is now open.
Michael Cherny
Good afternoon. Thanks for all the color so far. I want to ask a little bit about the CMS code as you think about the chicken in the egg approach. As you continue to build towards those more lives dynamics. What is the more important part? Is it the fact that you have the coding place that payers are now willing and able to utilize with physicians having more clarity on reimbursement? Or is it more you need to bring the members the lives the payers to the table in order to help funnel the use of that code and drive more prescriptions?
Corey McCann
Michael, thank you for the question. Thank you for attending our earnings call. I think it’s broadly both. I think what we need in order to add to our current roster of covered lines is a combination of both payer demand as well as mechanisms for payers to provide coverage. From the payer demand side, that’s where you hear our health economic evidence story continue to evolve. Yuri mentioned where we are. He mentioned a bit about where we’re headed.
With regard to the category to HCPCS code, that’s an example of providing a billing and coding mechanism for these payers to be able to provide simple coding and payment. So it’s a long winded way of saying it’s both and it’s at the convergence of both demand and mechanism that we believe we can continue to advance our payer coverage.
Michael Cherny
Understood. And then I guess, Corey, your analysts want to answer this relative to the payer coverage. Obviously, you have some really nice brand names on the PBM side that are already adopting stateside as well. How do you think about that dynamic in place between having the lives under management versus how to make sure that you’re optimizing your positioning on the formulary? It’s one thing obviously to get the access, then once you get the access, how do you get in there to make sure that you’re being adopted, that your products are being positioned in the way that can drive further adoption from individuals?
Corey McCann
Michael, I think it’s all about demonstrating medical value and making sure that we are valued by the customers of many of these PBMs. And that’s where we’ve taken an employer strategy. You heard in the call today, adoption by a top 10 employer in the U.S. These are some of the largest customers of many of the PBMs and they have a position of prominence in the PBM industry. We believe that that demand, again, along with the creation of medical value in excess of product price helps us with formulary positioning. Thus far, formulary positioning has not been an impediment to our revenue generation. But it’s certainly something that we will continue to keep a watch on. And it’s something that I would expect you to ask going forward.
Michael Cherny
Guess it will be a topic we’ll address go forward but really appreciate the time and the educational effort here today and I look forward to catching up more soon.
Corey McCann
Thanks Michael, great to hear from you.
Operator
Thank you. Our next question comes from the line of Judah Frommer from Credit Suisse. Your line is now open.
Judah Frommer
Yes. Hi, guys. Thanks for taking the questions. first, the news flow out of Pear has certainly been robust. I would say since de-SPAC. I was wondering from a high level, you can help us with — what’s been, maybe the one or two, upside surprises in terms of progress that you’ve announced, kind of since the transaction. And then, more specifically on the Epic announcement. How is that going to affect Pear connects ability to serve as a PDT platform, have there been any conversations or thoughts around Pear’s ability to serve as the PDT platform within an EMR like Epic?
Corey McCann
Judah, thank you for the two part question. And we’ll address it as such. First, I’ll walk through what I view as some of our most important accomplishments, since our de-SPAC process, and then we’ll speak a little bit to Epic, and the way that it’s, we believe it’s positioned to be able to help our business.
So what I’d love to do is really just work from our operating metrics, and give you a sense for what we think are the most important events. From a prescription perspective, this is a place where we really have what we believe, to be a very supportive group of initial prescribers. And many of these prescribers are in larger health care systems. And we’re very interested in the opportunity to expand within those prescribers. I think that expansion can be driven by things like our EMR integration via the Epic App Orchard. We believe that that expansion also could continue to be supported by things like CMS, releasing its category one CPT codes, and I think it would be appropriate for us to place emphasis on the notion that, for the first time, providers will have the ability to be able to see financial remuneration for their use of prescription digital therapeutics potentially like our reSET, reSET-O, and Somryst products.
On the fulfillment side, you can think about this as a long and progressive movement forward. I think things like Epic, again, are emblematic of the tech platform, and what we affectionately call laying the plumbing for this entire space, you’ll see us continue to move in that direction, make prescribing simpler. And we believe that that is really the key to boosting fulfillment rates.
On the coverage side, we had quite a year, we’re very proud of the year that we had. And I think some of the marquee wins that you’ve seen, for example, like Massachusetts Medicaid providing coverage really provides a template for every other Medicaid organization that may be looking to cover PDTs. You’ve seen Oklahoma, already jump on-board, and we issued a press release with Michigan as well. We believe that that momentum in the payer world is again supported by the pleasant surprise of the level two HCPCS codes. I think the easier these products are to prescribe and to pay for, the more ubiquitous they’re likely to become.
I think the last thing that I would highlight, and this is not a pleasant surprise, it’s just the way that we roll at Pear. We’re a data centric business. And you heard Yuri talk about our nine-month health economic data. We’re very proud of the ability to continue to put forth data that not just shows that our products are utilized in the real-world. Data that not just shows that our products have clinical effects in the real-world but data that shows that our products save money in the real-world. And so I think if you put all of that together, our priorities for calendar year 2022 are quite clear. To achieve our $22 million in revenue, it’s drive some of these major coverage decisions. It’s continuing to generate that health economic data at scale, because we know that that’s the tail that wags the payer dog. And it is an increase in adoption across major centers.
Finally, we didn’t get a chance to talk much about our pipeline, but we’re a company that aims to do this time and time again. And we’re very excited to be able to speak with you going forward about developments in our pipeline.
Judah Frommer
Great, thanks. If I could sneak one more and just kind of one of the key question’s we get from investors is, we’re sort of in the early stages of this modality and kind of the path forward is still being laid by various entities. But do you feel you get enough credit for the randomized clinical trial work that you’ve done in Pear conversations? Or are they saying, we’re going to wait and see what the real-world data looks like and make decisions and effectively kicking the can a little bit?
Corey McCann
Judah, I flatly don’t view it as kicking the can. I view this as the new standard in healthcare. And I think whether we are addressing a digital health product or a pharmaceutical product or any other innovative medical device, it is standard of play and standard of the industry to look for real-world data and to look for evidence of health economic benefit. So we think this is really just the rules of engagement. And I think we’re very excited to be in a position where for the first time, all of our commercial products will have what I affectionately refer to as the holy trinity of clinical data, randomized clinical trial data, in addition to real-world performance data, in addition to cost data. And I might ask our Chief Medical Officer, Yuri, if you have anything to add on the real-world or health economic front?
Yuri Maricich
Yes, Judah, I think just to underscore what Corey said is that we see the focus on generating evidence as really just part of the demand of health systems, particularly the health ecosystem and payers bid large for any type of product. And really, the competitive advantage and differentiator for Pear’s here is the speed with which we can do it. So as Corey said is that we have those RCTs, and those RCTs really show clear internal validity of the clinical benefit of our products. But to that, we see the use in the real-world, and that, that use is consistent with our RCTs. And so that gives more reasons to believe by providers and payers. But then third, as Corey said, is in really showing the medical value and the cost savings from the product, but the fact that we can do this rapidly and we can do this, whether in studies or in our real-world allows us to use that as a catalyst as we engage with payers. And so we’re really excited to continue to talk about additional data as we are able to generate it.
Judah Frommer
Great, thanks.
Operator
Thank you. Our next question comes from the line of Eric Percher from Nephron Research. Your line is now open.
Eric Percher
Thank you. Good to see the 14,000 scripts and the steady target for 50,000 to 60,000. It looks like today you’re averaging about 25 scripts per doc. What’s your aspiration for scripts per doc? It sounds like expansion within existing systems is important. Also wondering, if the density you’re driving in states like Massachusetts is a driver there. And then the flip side of that, what’s your expectation in terms of additions for prescribers?
Corey McCann
Eric, thank you for listening and thank you for your questions. And I know that we’re starting to run a bit long here, and so we’re going to try to keep our answers relatively brief. As you know, we haven’t issued any sort of guidance in terms of prescriber expansion, number of prescribers or any sort of other functional or productivity metrics associated with scripts. With all that said, I think what I can tell you is that at a very high level, our strategy resembles much more that of in enterprise software provider within healthcare than it does a traditional pharmaceutical company. And what I mean by that is as opposed to detailing doc by doc, what we tend to do is detail either center by center or organization by organization.
And what that creates is a top-down mandate that then allows us to embed, and when I say embed, I mean physically embed via things like EMR integration and utilization of our pear.md dashboard and via that top level embedding, we’re then able to target clinicians and mix. And I’m sorry, if I mix my metaphors here, I didn’t mean in Massachusetts, what I meant was in large groups. So what I would expect in 2022 is really not to be thinking so much about scripts per clinician ratios, but I expect to be looking toward what are our conversion of larger clinics, and I would expect the conversion of those larger clinics and larger health systems to potentially be some of the catalysts that you might see going forward.
Eric Percher
That’s helpful. And a quick financial one for Chris. I know you’re sunsetting gross to net guidance, but at 18%, it sounds like you’re not far off from mature expectations. Is it fair to assume that the mature expectation has not changed?
Chris Guiffre
Our mature expectations have not changed.
Eric Percher
Perfect, thank you.
Operator
Thank you. Our next question comes from the line of Keay Nakae from Chardan. Your line is now open.
Keay Nakae
Yes, thank you. First question with the establishment of the CPT codes, what are you seeing now in terms of interest in providers in either wanting to know more about the product or interested in all the mechanics related to reimbursement from that point on?
Corey McCann
So Keay, it’s certainly early days for the CPT codes, but we anticipate that those codes will support physician payments for using pear.md to track therapy outcomes for education, as well as for setup on the therapeutic. Payers have really been considering these codes for a while, but additional education will occur around the addition of CBT programs. I think at this point, I’d love to pass it to Julia in order to speak just a little bit more to what we’re seeing around the Category 1 CPT codes.
Julia Strandberg
Great. Thanks, Corey. So this year-end 2022, our product supports the Cat 1 code through therapy adherence and therapy response and monitoring. And we believe that clinicians will be able to utilize again these codes for setup and monitoring when using Pear’s products. As it relates to January 1st of 2023, CBT’s cognitive behavioral therapy supply code will be available. And thus, we believe that these codes also apply across Pear’s products.
Again, as Corey mentioned, these codes include payments for setup and education, on patient use and equipment, and two, monitoring services in the first 20 minute and 20-minute increments, and three, is monitoring services greater than 20 minute. There are some national approximate payments and fee schedules that are created with those codes. So you can appreciate that a provider could receive payment for each of these codes on setup and education, both reSET and reSET-O, as well as Somryst and then could get paid for the monitoring services thereafter.
Keay Nakae
Okay. And second question specific to Somryst, and as we think about getting covered lives for that product, what would you expect would be the easiest types of entities of the different types that you’ve mentioned on the call today to begin covering that product?
Corey McCann
Keay, I think we, to-date, have not broken out covered lives for our three commercial products reSET, reSET-O, and Somryst. We have however spoken to what are some differing payer representations across the patients that are treated by those products. And so you’ve heard us emphasize a good bit state Medicaid. You can think about many of those wins as largely being specific to driving payer coverage for reSET and reSET-O. On the Somryst side, this is a patient population, which is more deeply Medicare, it’s also more deeply commercial.
As you think about the ways in which we bring these strategies together in many cases, we are engineering coverage to be a fee for service state Medicaid that ultimately compels managed care organizations, who are run by large commercial payers to provide coverage for reSET and reSET-O, and that’s a fantastic entree into coverage for Somryst. In addition, we mentioned the Prescription Digital Therapeutics Act. That is an act that we generate coverage across fee-for-service Medicare, as well as some other channels. And we believe that that’s an act that if it comes to fruition, would have a large impact on Somryst again because many of these patients are Medicare patients.
Keay Nakae
Okay. Thanks for that color.
Corey McCann
Thanks, Keay.
Operator
Thank you. Our next question comes from the line of Charles Rhyee from Cowen. Your line is now open.
Charles Rhyee
Yes. Thanks, everyone. And thanks for taking the questions here, and congrats on all the progress made so far. Wanted to go back about the HCPCS code here? And maybe ask a follow-up to one of the earlier questions. If we look at the fulfillment rate not primarily, sorry the coverage rate for ’21, if the HCPCS code was in place in ’21, how much more percentage points maybe a ballpark, could we have picked up in terms of prescriptions that were reimbursed for? Just trying to get a sense as we think about that implementation coming this year, how much of our revenue growth we should think of in terms of sort of access to Medicare coverage versus sort of the growth in the clients that you have so far?
Corey McCann
Charles, it’s a great question and it’s great to hear your voice. I appreciate your Maxie, and you can imagine that there are parts of that question that I just can’t get into, because they would address MMPI. I think what I can tell you is that we expect payers to continue to provide reimbursement for PDTs via both pharmacy and medical benefits. We’ve done a tremendous amount of work on the pharmacy side. And most of the coverage that we’ve seen to-date is via pharmacy. I think there are a number of reasons for that. Simplicity is perhaps the most important here.
It’s just easier to oversee and adjudicate a pharmacy claim than it is a traditional medical claim. That said not all payers are able to process PDTs, which are by statute a medical device via a pharmacy benefit. And so for those payers, we see them as being quite interested in these HCPCS codes, which ultimately allow the products to be reimbursed as a medical benefit. I think it’s far too early to be able to know exactly what sort of a impact those HCPCS codes will have, in fact, it’s too early that those HCPCS codes have not yet been issued.
We mentioned April 1st was the date at which those codes drop. It’s something that we will continue to monitor across calendar year 2022. And I think I hope you can tell from my voice, just the excitement that we have from what is potentially a standard coding mechanism across all payers, but again that’s split between pharmacy and medical is something that we’ll continue to work on. We’ll probably continue to bias toward medical, but we’ll continue to keep you updated on that front.
Charles Rhyee
Great. I appreciate that. Want to also follow up another question. When you guys were talking about PearCreate, and you talked about the SoftBank relationship making a Japanese language version for sleep. In this scenario, would Pear be the developer here or is with SoftBank, the sort of “developer of the PDT here for” the Japanese market using the Pear platform?
Corey McCann
Yes. And Charles, thank you for the question and thank you for highlighting the news, it’s something that we are incredibly excited about. What we have not done is to disclose operational details of the partnership in particular, and that’s something which is deeply into the MMPI portion of that potential agreement. I think what I can say personally is that the deal with SoftBank is quite exciting, because it represents our first step toward ex-U.S. expansion and because we believe that SoftBank could be a great partner in Japan. We believe that Pear is poised to lead the DTx revolution, and that’s not just in the U.S., but it’s also in other geographies.
Charles Rhyee
Appreciate that. I guess, where I was going with the question is in terms of PearCreate having other people build PDTs off your platform. Just curious, sort of what sort of inbound request you are getting from potential PDT developers to use the Pear platform and maybe a little bit more on that is sort of where else going with?
Corey McCann
Yes. And thank you for clarifying the question, Charles. We’ve been highly acquisitive. To date, I think the publicly available number that’s out there is about 18 deals. I think what we are seeing in this space is in evolution in the parties with whom we are having these deal discussions. And I think, if you think about the bad old days of the PDT space, we were having discussions with academic institutions and with very small companies. I think as many of these companies have been able to raise Series A and in some cases Series B financing, they see what is the value proposition of a commercial pipeline to be able to commercialize their PDTs either late stage or after approval.
So, I think, we are having more of those kinds of conversations and it’s very consistent with the maturation of the space writ large, I think the last thing that I would say here is that this is not something that we believe is driven by our ambition. We believe that this is something that’s driven by productivity in the healthcare landscape. As we are speaking with provider and provider system much like they interact with the EMR, there is an appetite for one and only one PDT platform. And because of our first-mover advantage, and because of our investment in infrastructure, we’re very excited to be positioned to potentially be that PDT platform.
Charles Rhyee
Great, appreciate it. If I can sneak one in for Chris. Appreciate the guidance for ‘22 that you’ve given so far, maybe you could help us think about EBITDA loss as we think about expenses for this year? I know you got about $175 million on the balance sheet, maybe kind of walk us through your thinking in terms of cash use for this year?
Chris Guiffre
So first, Charles, I just want to clarify we have about $170 million on the balance sheet at year-end, not $175 million, but certainly right in the same neighborhood that you estimated. We don’t provide expense guidance. I don’t think that Pear is at a state of maturation where we’re ready to do that yet. But if you look at our 10-K, which will be filed tonight, you’ll see that our expenses grew each quarter last year as we invested in our commercial launches and prepared to go public. Again, we don’t provide expense guidance as we do with some of the other metrics that you referred to, but I can assure you we do not expect to see quarterly growth and expenses this year.
Charles Rhyee
Okay. That’s helpful. Appreciate all the comments. Thanks guys.
Chris Guiffre
Thank you.
Corey McCann
Thank you, Charles.
Operator
Thank you. Our next question comes from the line of Marie Thibault from BTIG. Your line is now open.
Marie Thibault
Hi, thank you for taking the questions and congrats on your debut earnings quarter. Wanted to ask a question here. Happy to see the reaffirmed 2022 revenue guidance. I wondered if you could give us any anecdotal look into how Q1 has been going or how you would prefer sort of investors and analysts to be thinking about the cadence of sales this year?
Corey McCann
Marie, it’s good to hear your voice. And Chris, I’d love to pass the question to you.
Chris Guiffre
Sure. Marie, thanks so much for the question. We as you noted are very close to the end of the quarter, and I think all we can say there is that we believe we’re off to a good start to the year.
Marie Thibault
Okay, fair enough. I’ll take it. Maybe I can ask my follow-up here on legislative efforts, certainly, the bill that was introduced. Can you talk a little bit more about possible timelines? I know it’s hard to predict of legislation, but is that something we might hear more on this year? Is it simply sort of a way to get the conversation started or do you think something material could happen here this year?
Corey McCann
Marie, I wish we had visibility into the timing of this particular bill, but I think it would be folly for us to introduce any sort of guidance around timing. I think what we again can say is that this is something which is a big swing for the Company and for the space. We believe that this would absolutely be a home run and would institute what is very close to universal coverage for PDTs as a product class and prepares commercial products. I think the only thing that I can say with regard to this particular bill is that it’s not something that’s baked into any of our financial projections. And I think we’ve been very clear about that in our conversations with investors and in our discussions to-date. So I would think about this as upside. And I think we’re very excited to have the opportunity to be able to relay news back to you. But I would decline on being able to provide any sort of estimates on probability of success and/or on timing.
Marie Thibault
All right, very good. Thank you for taking the questions. And good luck.
Corey McCann
Thank you, Marie.
Operator
Thank you. Our next question comes from the line of Neena Bitritto-Garg from Citi. Your line is now open.
Neena Bitritto-Garg
Hey guys, thanks for taking my question. I know we’re short on time here, but maybe just a quick question on reimbursement kind of following up on the theme of most of the questions. But I guess, if you had to identify maybe one key event or one key driver of kind of progressing your payer deals and kind of increasing the number of covered lives, what would you kind of call out as kind of a key event for this year? Thanks.
Corey McCann
Yes. So, I think I would point to two key events with regard to coverage in 2022, and neither of them are discrete events. They’re both about trends. I think the first is we will continue to publish a steady stream of health economic data. And we mentioned in this call, upcoming 12 months data for reSET-O, that’s a milestone that seems to be of significance for some payers. And again, we’re very excited for all of our products to have randomized clinical trial data, real-world performance data and health economic data.
And it’s my hope that as an analyst following this company every time that you see another health economic publication that, that helps to signal that we are developing our payer value proposition and really moving those conversations forward. I think the second thing is another trend, and in the world of payer coverage, it’s a bit of death by a 1,000 cuts. And so really what we’re looking to do is move from coverage of PDTs as being something innovative to coverage of PDTs as being something standard. And you saw this already and you’re seeing this already.
We announced our coverage decision with Massachusetts Medicaid, and I think that was lauded as an innovative move by the state. Very soon thereafter, you saw the press releases that we issued around work that we’re doing in the states of Oklahoma and Michigan. We also happen to be doing similar work in the states of Indiana, Ohio and Kentucky.
And so you’re really seeing this fee for service state effort yet to critical mass and these states are, they’re changing their tone as opposed to asking what is the PDT, they are asking how do we cover a PDT and not just are they asking how do we cover a PDT, they’re asking how do we cover a PDT like innovative states, like Massachusetts, Oklahoma and the other states that I mentioned. So I think this is less about discrete binary events, and this is more about a steady cadence of progress going from novelty to making these products mainstream medical treatments.
Neena Bitritto-Garg
Got it. Thank you.
Operator
Thank you. I’ll now turn the call back to Dr. McCann for closing remarks.
Corey McCann
We know we’ve covered a great deal in this introductory call. So I’ll wrap up very briefly. In 2021, we put the PDT category on the map with rapid commercial progress highlighted by major wins with payers. That commercial progress led to $4.2 million in revenue, in line with our guidance. In 2022, we plan to build on the significant momentum we generated last year. We plan to further the commercial traction of PDTs as a class and move the healthcare system closer to Software as a mainstream medicine. Thank you for your time. As always, please reach out to Meara Murphy, our Head of Corporate Communications if you have any questions.
Operator
That concludes today’s call. Thank you for joining.
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