On the RECOTHROM front net sales for the quarter was $9 million. This is doubling of Q1 sales for 2009. January in particular was a very weak month across the hemostat segment and RECOTHROM was no exception. That said, for the quarter actual hospital demand that it's units moving from the wholesaler inventory to hospital end user increased by 14% compared to the fourth quarter of 2009.
RECOTHROM market share in dollars continued to increase in Q1 to approximately 19% versus 17% in the prior quarter. Jim will discuss the factors that influence our reported net sales for the March 31st quarter, but demand in market share continued to grow and based on momentum we see in the market place, we are comfortable with our full year guidance of $48 million to $54 million of net sales............
Net sales of RECOTHROM were $9 million for the quarter, doubling from $4.5 million a year ago. Net sales were approximately the same as the fourth quarter of 2009 even though we had positive trends in units sold to hospitals and market share as Doug described earlier.
There are two primary reasons for this, both of which were related to differences between the timing of hospital purchases and when we record revenue based on sales to wholesalers. First, decreases in wholesaler inventory levels had a significant impact. We estimated there were about 2.4 weeks of sales in the channel at March 31st, compared to about 3.2 weeks at the beginning of the quarter.
Second, the way that the weeks fell in the calendar had a significant impact, in that there was about one week fewer sales included in the three months ended March 31st compared to the three months ended December 31st. Together these two factors caused our reported net sales to be lower than one would expect based on underlying hospital sales trends.............
Brian Abrahams - Oppenheimer and Company
Great. Can you remind us how was [RECOTHROM] reimbursed and what impact the healthcare reforms would you expect?
Well, as three reimbursement was captured in the cost of any surgery we don’t see there will be any impact on the reform side at all in terms of our pricing and how we capture. So my guess, we are fortunate in that one of the few maybe who are not affected by that..........
David Miller - Biotech Stock Research
Now switching to RECOTHROM for a moment, can we expect the kind of continued slow grind we have seen for RECOTHROM sales on a quarter-over-quarter basis? Going forward, is there some kind of invents that we can look forward to that might provide an inflection or you would be replacing more of the JMI sales out there?
This is Stephen Zaruby. I think as Doug said we are encouraged by the momentum that we have seen, but moving forward obviously we are very active in the marketplace at all kinds and different touch points and levels be it through our sales force or national accounts people dealing with GPOs and so on and so forth and as Doug said we remain confident in our annual guidance and so it depends how you might forecast or sort of allocate our sales quarter-by-quarter, but we expect to see continued growth and the growth certainly comes largely or entirely at the expense of Thrombin-JMI........
Paul Latta - McAdams Wright Ragen
One another question on the RECOTHROM, you mentioned that the hemostat market was a little soft in January, any thought as to why?
It's hard to say. I think it was sort of an observation we made looking at the totality of the markets. If you recall Paul we saw similar situation with our fourth quarter to first quarter situation last year, but I don’t know how much of it is sort of seasonally related, but I think beyond the metrics that Jim sketched out in terms of one less week and drawing down the wholesaler inventory levels. Those are really the sort of firm facts we can throw out and beyond that I think we just beat speculation as to what was happening in the market there, but quite clearly January for everyone in the hemostat area was a soft month.
Paul Latta - McAdams Wright Ragen
Is their [year-end] budget plus possibility too?
Again it's hard to say. I think you could relate it to everything from bad weather on the East Coast to general economic conditions, but I think fundamentally we don't really have a clear-cut answer for you as to why January was soft.