OPRX - NASDAQ

Good afternoon, everyone, and thank you for joining OptimizeRx's Third Quarter Fiscal 2024 Earnings Call. With us today is OptimizeRx's Chief Executive Officer, William Febbo. He is joined by Chief Financial Officer, Ed Stelmakh; President, Steve Silvestro; General Counsel, Marion Odense-Ford; and Senior Vice President of Corporate Finance, Andrew D'Silva. At the conclusion of today's earnings call, I will provide some important cautions regarding the forward-looking statements made by management during today's call. I would like to remind everyone that today's call is being recorded and will be made available for replay via webcast only. Instructions are included in today's press release and in the Investors section of the company's website. Now I would like to turn the call over to OptimizeRx CEO, William Febbo. Sir, please go ahead.

Thank you, operator. And good afternoon to everyone joining today's third quarter 2024 earnings call. To get started, while our year-over-year top line revenue grew 30% and came in at $21.3 million, it fell short of our expectations for the quarter. This is largely due to a shortfall with the DTC side of the business, which we acquired last year. However, we are pleased with our legacy HCP business growth, bottom line performance, and cash flow generation in the quarter. We were able to realize incremental savings during the year as we completed the integrations of the combined commercial businesses and found operating efficiencies on top of what we had initially expected at the time of the acquisition. As a result, we're updating our guidance and are now expecting 2024 annual revenue to come in between $88 million and $92 million for 2024 with a modest change to the adjusted EBITDA landing between $8 million and $10 million. Given we are well into November, we have high visibility on this revenue guidance. Regarding the revenue shortfall, we encountered macro shifts at the DTC business, specifically a market trend away from managed services, where we create compliant audiences and manage media buying for the clients towards a self-service model. In this self-service model, we provide audiences to clients who then use them to run their own messaging campaigns. Self-service is specific to the DTC business and less common on the HCP side of the business. In this self-service model, which has become our primary focus, we built compliant audiences in 50 states for customers to purchase for their own digital media. This patent-protected solution is our micro-neighborhood targeting and is experiencing strong growth with a notable percentage increase in customer engagements during the year. However, despite the growth in micro-neighborhood targeting, it has not yet offset the decline in our managed services. Acquiring Medicx Health during the fourth quarter of 2023 made it challenging to capture customer wallet share in the middle of the calendar year sales cycle. However, we have implemented commercial changes going into 2025 that we believe will resolve the softness we saw in our DTC business this year as we focus a greater portion of our efforts on securing self-service revenue streams. With one year as an expanded team, we are seeing continued cross-selling and up-selling, which should have a very positive impact on 2025, given the year-over-year growth in our pipeline build thus far. A top three pharmaceutical manufacturer is leaning into this solution, especially as they navigate an increasingly complex regulatory environment spreading across multiple states. This client alone could mean significant growth in 2025 in DTC. With privacy regulations expected to expand nationwide, we are well positioned to meet the market's evolving privacy demands. We remain very bullish on our business and our industry thesis around the combination of DTC and HCP under one platform, and our customers are experiencing meaningful value add through the marriage of HCP and DTC. In fact, we recently held a panel discussion with the top five pharmaceutical company at Digital Pharma East where they confirmed this market need and value. I would encourage everyone to go to our website and listen to the panel. It's a harbinger of where the market is going and how far ahead we are with a scalable technology enabled solution. We continue to be the only company among our peers providing this union at scale. We are seeing progress with growing our total wallet share with our largest customers, still dominated by our HCP business. We now have one client expected to surpass $15 million of in-year revenue and see at least four customers for 2025, which are expected to generate over $10 million in revenue. All this gives us confidence in the business, its trajectory, and the value proposition to our client base. This is how pharma scales with their partners, and we are thrilled they trust us to help them with commercialization. Our point-of-care network continues to grow and we recently added several EHR partners to our network, incrementally adding thousands of HCPs. Our channel partner network continues to be our largest moat, and we have seen potential competitors attempt to get into the space, but have not seen anyone show the ability to succeed with scale. In a similar vein, on the DTC side of the business, we continue to expand our direct integrations with leading publishers and media partners, which allow us to extend our reach to support both direct and indirect go-to-market execution. This enables us to sell the publishers and media partners or sell through them as they approve use of our audience data in their publishing networks. We believe we have the right solutions and the right people to execute on our strategic roadmap. With the addition of DAAP to OptimizeRx omnichannel network, we have a pioneering and foundational AI-directed capability, which removes the mystique of seamlessly integrating point of care and traditional digital media, offering a transparent and measurable solution for pharmaceutical marketing that is able to reach nearly 240 million US adult lives and 2 million HCPs. DAAP, coupled with our proprietary EHR network and channels outside of the EHRs, are driving powerful next best action capabilities based on dynamic real world data. As a result, DAAP is now used to power CRM alerts as well as social media, web display and other mass digital communication channels which fosters greater efficiency in collaboration with our customer sales forces. OptimizeRx is expanding its AI solution work with customers while others in our space are still trying to figure out how to apply AI. As a result, I believe we have an opportunity to capture a significant market share in the coming quarters and years to drive highly profitable growth. And with that, I would like to turn the call over to our CFO, Ed Stelmakh, who will walk us through our financial details. Ed?

Thank you, Will. And good afternoon, everyone. A press release was issued with the financial results of our third quarter ended September 30th, 2024. A copy is available for viewing and may be downloaded from the Investor Relations section of our website and additional information could be obtained through our forthcoming 10-Q. Third quarter revenue came in at $21.3 million, an increase of 30% from the $16.3 million we recognized during the same period in 2023. Gross margin for the quarter increase was 60% in the quarter ended September 30, 2023, 63.1% in the quarter ended September 30, 2024. Year-over-year gross margin expansion is tied to higher DAAP-related revenue, as well as a favorable channel partner mix. Our operating expenses for the quarter ended September 30, 2024 increased by $8.7 million year-over-year, largely due to the Medicx Health acquisition and a $7.5 million goodwill impairment charge. And we saw significant benefits from cost-cutting initiatives that approach $5 million annually, tied to the integration efforts with the acquisition. We had a net loss of $9.1 million, or $0.50 per basic and fully diluted share, for the three months ended September 30, 2024, as compared to a net loss of $2.9 million or $0.17 per basic and fully diluted share for the same three-month period in 2023. On a non-GAAP basis, our net income for the third quarter of 2024 was $2.3 million or $0.12 per fully diluted shares outstanding as compared to a non-GAAP net income of $1.6 million or $0.09 per fully diluted share outstanding in the same year-ago period. Our adjusted EBITDA came at $2.7 million for the third quarter of 2024 compared to $0.9 million during the third quarter of 2023. We're happy to see that this came in ahead of our expectations and highlights our improving margins and cost-cutting initiatives. Operating cash flow came in at $4.7 million for the first three quarters of 2024. And we ended the quarter with $16.1 million cash balance as compared to $13.9 million on December 31st, 2023. At the end of the third quarter, the principal of our debt financing stood at $36.8 million. If you recall, to help fund the $84.5 million cash portion of last October's Medicx Health acquisition, company took on $40 million in debt financing and we paid off $3.2 million in principal through the third quarter of 2024. In addition, we made an incremental $2 million pay down in October. We have paid down $5.2 million in the first 12 months since the acquisition was consummated, way ahead of the required schedule from our operational cash flow. We continue to believe we are well-funded to execute against our operational goals. Now let's turn to our KPIs for the third quarter of 2024. Average revenue per top 20 pharmaceutical manufacturer now stands at $2.8 million and we've worked with all top 20 largest pharma companies in the world. Net revenue retention rate is showing an improvement at 127%, up from 93% in Q3 2023. Meanwhile, revenue for FTE came in at $630,000, topping the $568,000 we posted in Q3 2023. And with that, I'll turn the call back over to Will. Will?

Thank you, Ed. Operator, now let's move to Q&A.

[Operator Instructions]. The first question is from Ryan Daniels with William Blair.

Maybe given some of the weakness you saw in the Medicx business during the quarter, I'm curious if you could talk about any go-to-market changes you're making specific to that asset, number one. And then number two, given the strength you're seeing in kind of the legacy core business with DAAP, are you shifting any more management or sales focus to that specific offer on a go-forward basis?

I'll start and then, Steve, you can add in if you want. Relative to Medicx, yeah, we, through Q2 into Q3, finalized the enhancement of that sales team. And obviously, we had a sense of this shift materializing and feel like we have absolutely the right team to go after this shift to self-service model as well as a group that's sophisticated enough to understand how DAAP is a real differentiator relative to DTC. So net-net, the go-to-market is the same, but enhanced team. And we also made a lot of progress coordinating the marketing efforts, which just allow that message to get out there. And if you remember, and as we talked about in the prepared remarks, we really believe that pharma is going to lean towards combining DTC and HCP really as a way to get one true source of data to allow them to make quicker, more agile marketing decisions. And so go to market, same, enhance with team. And on the core, we continually invest in that team. It's a very experienced team, obviously, now with the years behind us. And what I've seen is a tremendous cross-sell effort between the two, which is why we reference pipeline just being up year-over-year. And I think it's attributable to that team. Steve, you want to add anything to that?

I think you mostly covered it well. The only thing, Ryan, that I would add to what Will said is in terms of product roadmap and evolution of what we're doing on the Medicx side, bringing DAAP into that audience creation is really going to be a game changer we think in that space. This space, DTC specifically, is largely a space that operates with static audiences, meaning they pull an audience one time and execute messages throughout the course of a program. And as you know, from leaning way into DAAP, DAAP is real time update. And so, there is a massive first mover advantage by bringing DAAP into that. We're well down the road there with a couple of already tests and things going out and live. So I think we're encouraged by that. We're moving faster to fill the gap for the managed service shift. But the good news is I think the overall business profile in terms of margin and execution, the renewability, all of those things improve by moving away from managed service and into self-service, which is where that business needed to go. So I think we're encouraged by the change, but, yeah, unfortunately, it gives us a bit of a hiccup on the quarter.

It sounds like sales pipeline is good, new DAAP contract's good, the metric you provided on the four clients for next year over $10 million, great. So question there, is that all in your revenue for 2025? So meaning, do those four clients alone give you over $40 million in visibility. And then, I know you don't want to provide an outlook for 2025, but maybe assuming the end of year, at that $90 million mark, what type of growth would you be satisfied with or comfortable with for 2025?

It's a little early. We'll be back to the market on 2025, but to answer your direct question, yes, that's all in your revenue. And what's really been encouraging is just seeing multiple enterprise-like discussions, not just those four but others that are also climbing up. As you saw, our average KPI per manufacturer keeps moving up. I think we'll keep seeing that trend. What that really means on the four that we have visibility on is there's just more opportunity for others to follow. Generally, that is how pharma will work. You've got a couple early believers and you start to scale and prove it out and have the right return on marketing investment and then the others come. And I think between our time at some of the conferences and also just seeing that kind of visibility, this time last year we did not have that visibility.

Maybe one more if I could. I apologize for doing three instead of one to follow up. But if I do look at your key performance indicators, the average revenue per top 20 is up about almost 50% year-over-year, which is great to see versus the revenue growth at 30%. So does that mean exactly what you just said, that the bigger companies are kind of latching on to this being a little bit more innovative and some of the smaller pharma manufacturers are a little bit harder to move towards DAAP or some of these integrated programs? Is that a fair thought?

It's a mix of things. I think there's some truth in that and then there's also just some of the transition away from managed service that's going to impact it as well. But what I think is most encouraging is they are buying into the more precision-based point of care to omni-channel digital marketing. And we have an incredible position in there. And adding DTC in the last six months, I've seen just our profiles of company within the client base being taken much more seriously. And frankly, the whole team has been fully trained up. So it really adds a lot of punch to it. So I would anticipate others are going to start moving towards the bigger enterprise discussions. And with DTC and HCP together, that can move faster, right, than if we were just doing HCP. So. Very encouraging.

The next question is from Sean Dodge with RBC Capital Markets.

Maybe just going back to pipeline and backdrop. Will, you mentioned some significant progress with the pipeline and seeing pharma continuing to lean into digital? Is there any quantification or kind of other bookends you can share with us, just to give kind of some sense of how much bigger or how much more advanced the value of your pipeline is now versus maybe this time last year.

We've kind of gotten away from pipeline as a metric, but we've basically doubled the sales force year-over-year with the addition of Medicx and then the continued investment in the team, both sales, marketing, account management and operations. And it's a higher percentage than the growth on the quarter. But pipeline for us is an indicator for the year and then having the visibility around the four at $10 million plus, we just haven't had that before. I think I'll ask Steve to comment, but the pipeline is just cleaner, smarter, and the market really understands what we do now in terms of the clients.

In addition to that, I would say, one of the challenges with the Medicx business sort of acquiring it, you heard Will's prepared remarks, during the actual RFP cycle, just smack dab in the middle of it, I do think there was some disruption around that. And what we've learned from now having that business for a little over a year is that it's heavily dependent on the RFP cycle, more so than our core HCP business. We've got levers in here to be able to accelerate there and close deals with a pretty good velocity. On the DTC business, we're more reliant on the annual cycle. And right now, because that team is leaning in so well on the annual cycle, as Will said, the pipeline is building very, very nicely. So I think we're encouraged by that.

For the 2024 guidance for the full year, continues to imply a pretty significant step up in Q4 revenue. Will, you alluded to it, but anything you can share, just on visibility you have into that, it's mid-November now, is there any go-get left in the guidance, I guess, everything you need for that in backlog at this point?

Very minimal go-get, correct. Yeah, high visibility.

Last one for me. So you talked about sales cycle before on some of these larger deals being a little bit longer up front, but ultimately they're larger deals. So well worth the effort. I guess any change you've seen since then in terms of sales cycles? Are these still taking a little bit longer, you've seen anything kind of accelerate or drawing out more heading into next year?

I'll grab it, Will. It's different by business, Sean. On the HCP side, we've definitely seen an acceleration in our sales cycle, which has been good. Probably 20% improvement, which I think is largely a credit to two things. One, we've got a more mature sales force, which is doing an excellent job of driving that business. And two, our legal team and contracts team have done an absolutely spectacular job of streamlining all of the contractual stuff with our clients, which has just made it easier to do business with us. So I think that's helping on the sales cycle. On the DTC side, like I said earlier, we're really relying on that RFP cycle. So sales cycle is still about the same, but I think it's within the bands is what's appropriate for that. But again, I think we're encouraged – early days, but encouraged by the pipeline growth and have a ton of confidence in the new hires and folks that we've brought on from all the key competitors in that space. So, excited to see what the rest of Q4 looks like and what Q1 will bring for that business specifically. And I think we've got a great deal of faith and confidence in it at this point.

The next question is from Kyle Bauser with B. Riley.

Maybe I'll just start off on some housekeeping things. So last quarter, I think there was a slight miss just based on that one contract that kind of slipped through, the $6 million contract. And then during Q3, we got an update talking about how that contract has increased to $10 million, which is great. But the DAAP portion of that was still kind of going through the internal review process. Is that the same program as the $15 million contract that you talked about in today's press release? Maybe I'll start there.

That's the in-year revenue expected from that particular contract.

So that went through and is expected to be captured both on the DTC and the DAAP side.

That's one client. It's all HCP.

So, it's all the HCP and it was approved.

Yeah, it's all in-year. Yeah, that's all in-year.

EBITDA came in better than expected despite the lower sales. Can you talk a little bit more about the reasoning here? I didn't quite catch it. So with the cost-cutting initiative or the lower sales, just curious how we were able to kind of capture that much margin expansion.

A couple of components here. I'm assuming you have the expansion in gross margin. That's driven by channel partnership mix, as well as product mix. And then secondly, we do have some nice tailwinds in operating expense run rate, driven by the [indiscernible] we did earlier in the quarter, last quarter. And then also just the savings across the board in terms of spend.

I guess going forward, what are some expectations for how we should look at kind of that G&A line item? We obviously have guidance for the balance of the year, but heading into next year with the strong pipeline, how should we be thinking about that?

G&A is actually – most of what we typically would dig into our run rate has to do with merit increases and relatively small headcount growth, and any other incidentals or kind of one-off types of expenses related to expansion in the channel partnership ecosystem. Outside of that, there's really not much anticipated.

I guess in terms of looking at how it should grow off of kind of 2024 levels, should it be similar to what we saw? So are you saying 2025 could be similar kind of growth of the OpEx or G&A line to what we're seeing in 2024?

Yeah, it'll be in the ballpark. We'll come back obviously with more precise numbers once we get the budget finalized. But if you're looking for some directional kind of guidance, if you add 5%, 6% merit and then kind of a small amount for headcount growth, plus, like I said before, some additional potential expansion in channel partnership realm, it should be pretty close. We'll come back with more precise numbers in a couple of months.

The next question is from David Grossman with Stifel Financial.

I'm wondering, you talked about these four contracts that could do over $10 million each next year. Can you give us a better sense of what they may look like in terms of how much is HCP versus DTC – I assume they're all DAAP contracts. And how did they perform from a margin profile particularly the cadence over the year, there's some upfront implementation costs, just trying to get a sense for what this bundle may look like.

Steve, do you want to dive into those?

So it's not four contracts. It's four clients. Just want to be clear on that. So it's total client spend. The majority of that, the lion's share of that, will be the HCP business. It'll be let out by significant investment in DAAP and in rules-based messaging, so things that are sort of the preemptor to DAAP and transitioning over there. Definitively, for each of those, we'll have sort of upfront costs, similar to our normal DAAP model of where you've got model costs and then you have transaction revenues that are tied to messages. So very, very similar. Although you've heard us start to talk to the migration of the DAAP components themselves being more subscriptive in nature, so a monthly data fee that's feeding in and then a transactional price for messages that are being deployed. The idea there is to, number one, make it stickier, more recurring-like, and number two is to sort of smooth the revenue over time, just make it more predictable and easier to manage. But that's sort of where we're headed. And good visibility there. We're talking, as Will said earlier, we're talking largely of the duals. And then the fourth one is sort of a new entrant, a different use case and one that we'll talk about as we get closer to it. But again, pretty good visibility at this point, as much as we've had.

And just getting to that subscriptive comment that you made, Steve, is your sense that just the way that the construct of these contracts are migrating is that you may have better visibility? I think if I heard you right, three of the four are renewals, right? Did I hear that right?

I want make sure you know these are not four contracts, it's four client level spends north of $10 million. And so, there are multiple contracts that need to be renewed for each of those clients to get us to the north of the $10 million mark. But the renewability of those is high. As you know, our client net revenue retention is very high for that sector. And then secondly, the migration component is we're moving the DAAP pieces from being sort of an upfront one-time fee to more of a subscriptive component where, when a client subscribes to that, there's a data piece that drops every single month across the agreement. And that's really what we want to get to. It just behaves better and it's easier to renew with the clients when we're engaging with them. There's not a pause to measure ROI. It takes away all of that sort of stop and start dynamic that we've been trying to overcome and I think we've got a good way to do that this time.

And then maybe in a similar context, but a different question, just thinking about this mix shift to self-service in the DTC business, how do you want us to think about that how in terms of year-over-year revenue growth because we're going to anniversary the acquisition in the fourth quarter. So just wondering, are we going to have headwinds? Should we expect to see headwinds from this mix shift going into 2025? And I think you made a reference to the margins maybe being better without the managed service components. So maybe you could just help us better understand what impact this mix shift may have on both growth and margin.

I was just going to say, look, when you have managed services in media, it's chunkier revenue at the top, but the margins are lower. You're placing media to a lower margin business, and largely agencies live off that business. But the audiences in your data are really what's valuable. And Steve highlighted the two differences. He highlighted one of them, which is just having a dynamic audience. So we do see that continuing to grow. through Q4 into 2025, but we're not going to go forward and say that'll make up the complete difference in managed services going down. We will get more clarity on that obviously over the next couple months, but it's actually a better business to be in, especially when the two start to come together. And so, you've got a patient profile, a dynamic audience both for HCPs and consumer. We think that's the future. And we're in a good place to do it. So I just wanted to get that out there. Steve, feel free to jump in.

No, I think you nailed it. It's massively differentiated, the ability to bring self-service with dynamicity, David, to it. So taking the dynamic nature of DAAP, turning that into the self-serve audience, which has already now been done and then deploying that – similar to kind of Ryan's question, it's just a massive differentiator in the space. And I think right now, we're in the middle of the RFP cycle. And as I shared earlier, this is a business – DTC is the business that's dependent, much more dependent than HCP, on a successful RFP cycle. And so, we are laser focused as a team on making sure that we execute well there.

Just to add, though, there's really just two pieces, right? Dynamic audience, we're going to continue to see self-service, micro-neighborhood targeting grow through Q4 into 2025. It won't outpace managed services. So we don't expect that to be a big top-line driver for the next 18 months. But it contributes, and it brings the stories together, and it's highly valuable. And the other piece that is still taking shape is, and this is one of the reasons why we really like Medicx and the methodology and their patented methodology is it's a more compliant solution. And on a state by state basis, right, regardless of what's happening in the country, these states are moving this way, right, to the standard. And we have a compliant method and we're seeing our clients take notice to that. So a lot will depend on how fast they take notice to that. That will be a growth driver. And we'll talk to that each quarter next year.

The next question is from Constantine Davides with Citizens JMP.

Just a follow up on self-service. Just who are you competing against for those kind of opportunities? I guess, a related question, for you to really scale that business up from here, do you have to do anything to invest in or sort of add resources to really take advantage of some of the growth potential in that part of the pipeline?

We've done the investing. We've got the team, the tech, the data platform. No incremental CapEx there. If anything, we've gotten smarter with data and how to use it in lots of different ways. And as Steve said, we've been very focused internally. The product and operations team have done a sensational job just leveraging data with tech and transparency and operationalizing it, so that it helps our clients. I think that's a key takeaway there. I don't know, Steve, do you want to add anything to that?

I think you said it. At this point, really, Constantine, it's about focus and making sure that we execute well, but the investments have already been made. Great product team, excellent sales people. Just think we've got to lean in and stay focused on it, but investments have been made.

And relative to the competition, I'm not going to give them free air time on the call, but I think how we stand out – there are people, there are clients – there are competitors on the DTC side. Most of those competitors do not have the HCP component. And then we believe those two elements of being dynamic audiences and compliant get us sort of those three legs to stand above the market. And we're very focused on audience quality and bringing those together. And we're seeing really nice progress there. So if these things all come together, that will accelerate growth.

I saw you guys close another five DAAP deals. Just point of clarification, are those all new? Or are some of those renewals, number one? Number two, what are you seeing on maybe some of the earlier DAAP clients as they come up for renewal in terms of either revenue or scope lift or anything else you'd call out?

Basically, from last year to this year, we've doubled the number of DAAP deals, Constantine, that we've done. So we've got accrete happening. We're also doing renewals at the same time. The renewal rate is very high for DAAP, just for all the reasons that you articulated earlier and several other folks have done. It still is dependent to where drugs are in their life cycle and where people are prioritizing spend. So we anticipate that while we'll have a good renewal rate, when things go LOE or there are shifts in marketing spend, et cetera, it'll still be subject to those shifts and changes. But so far the renewal rate is very solid. I think we're encouraged by that. We won't know the full renewal rate. Obviously we'll share that until the end of the year, once we've had all of the programs pause, measure, and renew and we'll be happy to share that. But I think we're all encouraged by the progress. And if we continue to march on this sort of double, then double, then double again, it's going to have a very meaningful impact on revenue.

The next question is from Stephanie Davis with Barclays.

I hate to be a dead horse, but I have more questions on the self-service model. Two quick ones before I kind of go into this. The first, I guess the self-service model is more attractive than some of the managed services. But are there any concerns that if macro remains tough, it could create challenges since it makes buying activity, or rather a lack of buying activity, a little bit easier to do on a more real-time basis. I guess secondly, what has kept you from expanding this in a more meaningful way into HCP?

Let's tackle the first one. Look, I think the dynamic nature, what we're seeing, and pipeline is sort of telling us this, is pharma believes in DTC. They believe in precision. They like dynamic. And they will require compliance, a compliant method over time. How fast that happens will drive growth? And I think we're in the perfect position for it. I think at our stage and where we are, the macro, we're not fully mature baked business, right, so the macro is relative on that. I think there's still plenty of spend and you're still seeing allocations going that way and I think it'll continue. On the HCP side, we've invested heavily, we're obviously deep into the more predictive AI enabled DAAP and we're seeing adoption there. But rules-based messaging is still a real piece of our business. And we think it will continue to be a real piece of our business because all along the cycle of large pharma, mid, small, they're all coming to digital. It's one of the most efficient ways to spend your money. You've seen it scale in other businesses in the market. And so, I think we're viewed as an honest broker and a good player in the business and that's going to attract more pharma and other sectors. For example, med tech is now a real space for us and we're in all the top med tech companies. So we continue to see that expand. Could we do it faster? You can't force pharma to do more. I think we're getting to that place where our name is really well known. For the first time in our history, a client sat with us on a stage and actually talked about what we do together. I think that's a sign. The takeaway, Stephanie, is this is an early business. And so, we think we're in a great place to capture more over time. And we'll continue to invest as we need to. And on the HCP front, we've heard of pharma really leaning into marketing the HCPs, more GLP-1s specifically. I thought that was becoming a bit more of a crowded field. I was hoping you could give us your view from the ground. Is that also what you're seeing?

Yeah, I'll start and then hand it over to Steve. But, yeah, there's clearly the demand to get differentiation out into the market, do it in a way that's digestible and understandable. And there are choices. And I do think they're going to – there's a lot of different strategies going on with approach to the consumer and the HCP. And got a couple that are out there ahead of the rest. And I think the spend will continue to get larger in that sector. And that does two things. One, they're going to pick people to scale with, and we have scale, so we think we'll win there. And secondly, it puts pressure on the other brands in other sectors, right, because this is a space that goes across multiple therapeutic areas. And so, we think it will actually increase the spend in other therapeutic areas as well just to get mind share and to be in the thoughts when decisions are being made on therapeutics. Do you want to add anything to that space in particular?

Yeah, I would just add two things that sort of support exactly what you said. Well, one is we're seeing a significant push, Stephanie, from all of these massive manufacturers that have got these GLP-1 franchises to communicate directly with the patients in a more meaningful way, given that these are behaving a little bit like lifestyle drugs. So, we're seeing massive investment there. Secondly, on the HCP side, because they are all basically – there's very little differentiation between these GLP-1s, with the exception of one that has a cardiology indication also approved for it, the timing element and the pricing elements are really critical for pharma to be able to capture patients via the HCP. And so, we are seeing much more of a lean into consideration of those dynamics, the timing of the message in the care window, qualification of a brand eligible patient, looking at things like cost reimbursement out of pocket, those pieces that are the predeterminants of successful onboarding for a specific patient. And they're not insignificant, there are prerequisites. I think broadly consumers believe that it's sort of just easy to get the GLP-1. And It's a little bit more than that. There are prior requisites and so forth, as you know. So I would say we do a really good job of tackling both of those pieces and enabling those messages to get to the right folks at the right time.

This concludes our question-and-answer session. I would like to turn the conference back over to William Febbo for any closing remarks.

Thank you, operator, and thank you everyone for joining us today. As we approach the close of the fiscal year, we want to extend our heartfelt gratitude to our shareholders for staying the course with us on this journey. I would especially like to thank the team at OptimizeRx. They are amazing. They work tirelessly to integrate these businesses and bring our platform to life, benefiting our rapidly growing base of pharmaceutical clients and brands during this pivotal time in the technological landscape. We remain a relatively young company with our dynamic audience activation platform, DAAP still in its infancy, and an evolving DTC business acquired just last year. We remain ever-present serving our clients' needs as they continue to buy in to the adoption of our integrated HCP/DTC businesses. While it may take a little longer than we thought, there's a clear large market opportunity and we are squarely focused on it as one of the early leads at the table. This has elevated our presence in the market among our clients, partners, and peers and many have taken notice. Not a matter of if, but when this company gets back to solid organic growth. I encourage everyone to stay the course and believe in this team as I do. We'll be attending the conferences later this month and I hope to provide some insights into the year ahead prior to our next earnings call. Until then, thank you for your time and belief in the OptimizeRx team. Have a good night.