CVRx, Inc. (NASDAQ: CVRX) (“CVRx”), a commercial-stage medical
device company focused on developing, manufacturing and
commercializing innovative neuromodulation solutions for patients
with cardiovascular diseases, today announced its financial and
operating results for the third quarter of 2023.
Recent Highlights
- Total revenue for the third quarter
of 2023 was $10.5 million, an increase of 70% over the prior year
quarter
- U.S. Heart Failure (HF) revenue for
the third quarter of 2023 was $9.4 million, an increase of 92% over
the prior year quarter
- Active implanting centers in the
U.S. grew to 159, an increase of 75% since September 30, 2022
- Cash used in operating and
investing activities for the third quarter of 2023 was $8.2
million, as compared to $11.4 million for the third quarter of
2022, and $13.0 million for the second quarter of 2023
- CMS Advisory Panel on Hospital
Outpatient Payment gave a unanimous non-binding recommendation to
support the request for Barostim to be mapped to a higher payment
level for 2024
“We're pleased with the growth trajectory of our business, which
has continued to exceed our expectations throughout 2023. The
impressive performance of our U.S. heart failure business has been
driven by the expansion of our commercial team and the increased
positive impacts of our marketing efforts,” said Nadim Yared,
President and Chief Executive Officer of CVRx. “Moving forward,
we're focused on maintaining this positive momentum while
continuing to expect a reduction in our quarterly cash burn as we
exit the year and look towards 2024. I want to express my thanks to
our dedicated team for their ongoing commitment to our mission of
improving patients' lives.”
Third Quarter 2023 Financial and Operating
Results
Revenue was $10.5 million for the three months ended September
30, 2023, an increase of $4.3 million, or 70%, over the three
months ended September 30, 2022.
Revenue generated in the U.S. was $9.6 million for the three
months ended September 30, 2023, an increase of $4.5 million, or
90%, over the three months ended September 30, 2022. HF revenue
units in the U.S. totaled 303 and 167 for the three months ended
September 30, 2023 and 2022, respectively. HF revenue in the U.S.
totaled $9.4 million and $4.9 million for the three months ended
September 30, 2023 and 2022, respectively. The increases were
primarily driven by continued growth in the U.S. HF business as a
result of the expansion into new sales territories, new accounts,
and increased physician and patient awareness of Barostim.
As of September 30, 2023, the Company had a total of 159 active
implanting centers, as compared to 140 as of June 30, 2023. Active
implanting centers are customers that have completed at least one
commercial HF implant in the last 12 months. The number of sales
territories in the U.S. increased by three to a total of 35 during
the three months ended September 30, 2023.
Revenue generated in Europe was $0.9 million for the three
months ended September 30, 2023, a decrease of $0.2 million, or
19%, over the three months ended September 30, 2022. Total revenue
units in Europe decreased to 47 for the three months ended
September 30, 2023 from 61 in the prior year period. The number of
sales territories in Europe remained consistent at six for the
three months ended September 30, 2023.
Gross profit was $8.8 million for the three months ended
September 30, 2023, an increase of $4.0 million, or 82%, over the
three months ended September 30, 2022. Gross margin increased to
84% for the three months ended September 30, 2023 compared to 78%
for the three months ended September 30, 2022. This increase was
due primarily to a decrease in the cost per unit driven by an
increase in the production volume.
R&D expenses increased $0.4 million, or 18%, to $2.7 million
for the three months ended September 30, 2023 compared to the three
months ended September 30, 2022. This change was driven by a $0.3
million increase in compensation expenses as a result of increased
headcount and a $0.1 million increase in non-cash stock-based
compensation expense.
SG&A expenses increased $3.0 million, or 23%, to $15.7
million for the three months ended September 30, 2023 compared to
the three months ended September 30, 2022. This change was
primarily driven by a $1.9 million increase in compensation
expenses, mainly as a result of increased headcount, a $0.5 million
increase in non-cash stock-based compensation expense, a $0.3
million increase in marketing and advertising expenses associated
with the commercialization of Barostim in the U.S. and a $0.1
million increase in travel expenses.
Interest expense increased $0.5 million for the three months
ended September 30, 2023 compared to the three months ended
September 30, 2022. This increase was driven by the interest
expense on borrowings under the loan agreement entered into on
October 31, 2022.
Other income, net was $1.1 million for the three months ended
September 30, 2023 compared to $0.3 for the three months ended
September 30, 2022. This increase was primarily driven by higher
interest rates on interest-bearing accounts partially offset by a
lower cash balance.
Net loss was $9.0 million, or $0.43 per share, for the three
months ended September 30, 2023, compared to a net loss of $9.8
million, or $0.48 per share, for the three months ended September
30, 2022. Net loss per share was based on 20.8 million weighted
average shares outstanding for three months ended September 30,
2023 and 20.6 million weighted average shares outstanding for the
three months ended September 30, 2022.
As of September 30, 2023, cash and cash equivalents were $83.0
million. Net cash used in operating and investing activities was
$8.2 million for the quarter ended September 30, 2023. This is
compared to net cash used in operating and investing activities of
$13.0 million for the three months ended June 30, 2023, which
included the annual premium for directors and officers insurance of
approximately $2 million.
Centers for Medicare & Medicaid Services (CMS)
Advisory Panel on Hospital Outpatient Payment Update
In August 2023, the Company delivered a presentation before the
CMS Advisory Panel on Hospital Outpatient Payment, resulting in a
unanimous non-binding vote in favor of mapping Barostim to the
higher paying code, New Technology APC1580, which would offer an
average reimbursement of $45,000 to hospitals in 2024. If CMS
instead decides to map Barostim to APC5465 without the transitional
passthrough payment for 2024, which is the basis for the Company’s
plans, then the average reimbursement to hospitals will be
approximately $30,000. The final outpatient payment rule is
expected to be published in late November.
Business Outlook
For the full year of 2023, the Company now expects:
- Total revenue
between $38.5 million and $39.0 million; up from previously issued
guidance of $37.0 million and $38.5 million
- Gross margin
between 83.0% and 84.0%
- Operating expenses
between $77.0 million and $78.0 million; down from previously
issued guidance of $78.0 million and $80.0 million
For the fourth quarter of 2023, the Company expects to report
total revenue between $10.5 million and $11.0 million.
Webcast and Conference Call Information
The Company will host a conference call to review its results at
5:30 p.m. Eastern Time today. A live webcast of the investor
conference call will be available online at the investor relations
page of the Company’s website at ir.cvrx.com. To listen to the
conference call on your telephone, please dial 1-877-704-4453 for
U.S. callers, or 1-201-389-0920 for international callers,
approximately ten minutes prior to the start time.
About CVRx, Inc.
CVRx is a commercial-stage medical device company focused on
developing, manufacturing and commercializing innovative
neuromodulation solutions for patients with cardiovascular
diseases. Barostim™ is the first medical technology approved by FDA
that uses neuromodulation to improve the symptoms of patients with
heart failure. Barostim is an implantable device that delivers
electrical pulses to baroreceptors located in the wall of the
carotid artery. The therapy is designed to restore balance to the
autonomic nervous system and thereby reduce the symptoms of heart
failure. Barostim received the FDA Breakthrough Device designation
and is FDA-approved for use in heart failure patients in the U.S.
It has also received the CE Mark for heart failure and resistant
hypertension in the European Economic Area. To learn more about
Barostim, visit www.cvrx.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. All statements other than statements of historical facts are
forward-looking statements, including statements regarding our
future financial performance (including our financial guidance
regarding full year and fourth quarter 2023 results), our
anticipated growth strategies, anticipated trends in our industry,
our business prospects and our opportunities. In some cases,
you can identify forward-looking statements by terms such as “may,”
“will,” “should,” “expect,” “plan,” “anticipate,” “could,”
“outlook,” “guidance,” “intend,” “target,” “project,”
“contemplate,” “believe,” “estimate,” “predict,” “potential” or
“continue” or the negative of these terms or other similar
expressions, although not all forward-looking statements contain
these words.
The forward-looking statements in this press release are only
predictions and are based largely on our current expectations and
projections about future events and financial trends that we
believe may affect our business, financial condition, and results
of operations. These forward-looking statements speak only as of
the date of this press release and are subject to a number of known
and unknown risks, uncertainties and assumptions, including, but
not limited to, our history of significant losses, which we expect
to continue; our limited history operating as a commercial company
and our dependence on a single product, Barostim; our ability to
establish and maintain sales and marketing capabilities; our
ability to demonstrate to physicians and patients the merits of our
Barostim; any failure by third-party payors to provide adequate
coverage and reimbursement for the use of Barostim; our
competitors’ success in developing and marketing products that are
safer, more effective, less costly, easier to use or otherwise more
attractive than Barostim; any failure to receive access to
hospitals; our dependence upon third-party manufacturers and
suppliers, and in some cases a limited number of suppliers; a
pandemic, epidemic or outbreak of an infectious disease in the U.S.
or worldwide, including the outbreak of the novel strain of
coronavirus, COVID-19; any failure of clinical studies for future
indications to produce results necessary to support regulatory
clearance or approval in the U.S. or elsewhere; product liability
claims; future lawsuits to protect or enforce our intellectual
property, which could be expensive, time consuming and ultimately
unsuccessful; any failure to retain our key executives or recruit
and hire new employees; and other important factors that could
cause actual results, performance or achievements to differ
materially from those that are found in “Part I, Item 1A. Risk
Factors” in our Annual Report on Form 10-K for the year ended
December 31, 2022, as such factors may be updated from time to time
in our other filings with the Securities and Exchange Commission.
Except as required by applicable law, we do not plan to publicly
update or revise any forward-looking statements contained herein,
whether as a result of any new information, future events, changed
circumstances or otherwise.
Investor Contact:Mark Klausner or Mike
VallieICR Westwicke443-213-0501ir@cvrx.com
Media Contact:Laura O’NeillFinn
Partners402-499-8203laura.oneill@finnpartners.com
|
CVRx, INC. |
Condensed Consolidated Balance Sheets |
(In thousands, except share and per share
data) |
(Unaudited) |
|
|
September 30,2023 |
|
December 31,2022 |
|
Assets |
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
82,993 |
|
|
$ |
106,194 |
|
|
Accounts receivable, net of allowances of $506 and $679,
respectively |
|
6,372 |
|
|
|
5,504 |
|
|
Inventory |
|
10,887 |
|
|
|
6,957 |
|
|
Prepaid expenses and other current assets |
|
3,345 |
|
|
|
4,223 |
|
|
Total current assets |
|
103,597 |
|
|
|
122,878 |
|
|
Property
and equipment, net |
|
1,723 |
|
|
|
1,698 |
|
|
Operating lease right-of-use asset |
|
1,058 |
|
|
|
334 |
|
|
Other
non-current assets |
|
26 |
|
|
|
27 |
|
|
Total assets |
$ |
106,404 |
|
|
$ |
124,937 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
$ |
1,133 |
|
|
$ |
1,719 |
|
|
Accrued expenses |
|
6,274 |
|
|
|
6,369 |
|
|
Total current liabilities |
|
7,407 |
|
|
|
8,088 |
|
|
Long-term debt |
|
14,294 |
|
|
|
6,747 |
|
|
Operating lease liability, non-current portion |
|
916 |
|
|
|
117 |
|
|
Other
long-term liabilities |
|
960 |
|
|
|
805 |
|
|
Total liabilities |
|
23,577 |
|
|
|
15,757 |
|
|
Commitments and contingencies |
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
Common stock, $0.01 par value,
200,000,000 authorized as of September 30, 2023 and
December 31, 2022; 20,813,612 and 20,663,736 shares
issued and outstanding as of September 30, 2023 and
December 31, 2022, respectively |
|
208 |
|
|
|
207 |
|
|
Additional paid-in capital |
|
551,045 |
|
|
|
545,362 |
|
|
Accumulated deficit |
|
(468,218 |
) |
|
|
(436,182 |
) |
|
Accumulated other comprehensive loss |
|
(208 |
) |
|
|
(207 |
) |
|
Total stockholders’ equity |
|
82,827 |
|
|
|
109,180 |
|
|
Total liabilities and stockholders’ equity |
$ |
106,404 |
|
|
$ |
124,937 |
|
|
|
|
CVRx, INC. |
Condensed Consolidated Statements of Operations and
Comprehensive Loss |
(In thousands, except share and per share
data) |
(Unaudited) |
|
|
Three months endedSeptember 30, |
|
Nine months endedSeptember 30, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
Revenue |
$ |
10,511 |
|
|
$ |
6,186 |
|
|
$ |
27,990 |
|
|
$ |
15,293 |
|
|
Cost of
goods sold |
|
1,691 |
|
|
|
1,340 |
|
|
|
4,536 |
|
|
|
3,490 |
|
|
Gross profit |
|
8,820 |
|
|
|
4,846 |
|
|
|
23,454 |
|
|
|
11,803 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
2,696 |
|
|
|
2,293 |
|
|
|
9,392 |
|
|
|
6,906 |
|
|
Selling, general and administrative |
|
15,652 |
|
|
|
12,679 |
|
|
|
47,504 |
|
|
|
35,945 |
|
|
Total operating expenses |
|
18,348 |
|
|
|
14,972 |
|
|
|
56,896 |
|
|
|
42,851 |
|
|
Loss from operations |
|
(9,528 |
) |
|
|
(10,126 |
) |
|
|
(33,442 |
) |
|
|
(31,048 |
) |
|
Interest
expense |
|
(499 |
) |
|
|
— |
|
|
|
(1,220 |
) |
|
|
— |
|
|
Other
income, net |
|
1,056 |
|
|
|
328 |
|
|
|
2,734 |
|
|
|
237 |
|
|
Loss before income taxes |
|
(8,971 |
) |
|
|
(9,798 |
) |
|
|
(31,928 |
) |
|
|
(30,811 |
) |
|
Provision for income taxes |
|
(40 |
) |
|
|
(32 |
) |
|
|
(108 |
) |
|
|
(81 |
) |
|
Net loss |
|
(9,011 |
) |
|
|
(9,830 |
) |
|
|
(32,036 |
) |
|
|
(30,892 |
) |
|
Cumulative translation adjustment |
|
(21 |
) |
|
|
(8 |
) |
|
|
(1 |
) |
|
|
(21 |
) |
|
Comprehensive loss |
$ |
(9,032 |
) |
|
$ |
(9,838 |
) |
|
$ |
(32,037 |
) |
|
$ |
(30,913 |
) |
|
Net loss
per share, basic and diluted |
$ |
(0.43 |
) |
|
$ |
(0.48 |
) |
|
$ |
(1.55 |
) |
|
$ |
(1.51 |
) |
|
Weighted-average common shares used to compute net loss per share,
basic and diluted |
|
20,801,350 |
|
|
|
20,576,838 |
|
|
|
20,730,024 |
|
|
|
20,512,254 |
|
|
|
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