NASDAQ, TSX: NVCN
VANCOUVER, Nov. 14, 2017 /CNW/ - Neovasc Inc.
("Neovasc" or the "Company") (NASDAQ, TSX: NVCN)
today announced financial results for the third quarter
ended September 30, 2017 (all figures in U.S. dollars
unless otherwise indicated).
"From a product perspective, our two lead devices continue to
perform well, quarter after quarter; patient after patient,"
commented Neovasc CEO, Alexei Marko.
"Tiara has been implanted in 17 patients so far this year and 39 in
total, and continues to show very encouraging results in terms of
technical success and patient outcomes. For Reducer, this
quarter marks a high-water mark in its commercial success in
Europe and it recently was
approved by the FDA to begin a pivotal study in the United States."
"With the U.S. appeals process completed and the funding
expected to be in place to advance our clinical priorities, our
chief focus now is to advance our European pivotal trial for
Tiara," added Marko. "This 115-person study is currently screening
patients at 10 clinics across the U.K., Germany and Italy. With the success the
product is already achieving in compassionate use cases and in
other early feasibility trials, our expectation is enrolment will
proceed in a timely fashion."
Implantation of the Company's proprietary product for treating
mitral valve disease, Tiara™, is completed through a short
trans-apical procedure and typically results in complete resolution
of the patient's mitral regurgitation without significant residual
leaks or obstruction of the ventricular outflow tract. To
date, 39 patients have been implanted with Tiara™. The 30-day
survival rate for the first 37 patients (those treated more than 30
days ago) is 33 of 37, or 89%. There have been 17 cases
performed in 2017, each was a technical success (100%), and of the
15 patients treated more than 30 days ago, 14 or 93% survived past
30 days.
The Neovasc Reducer™ continues to show good commercial progress
in Europe with a steadily growing
number of implants and positive patient outcomes. The Company
is currently exploring options for initiating the COSIRA-II IDE
study, a 385 patient to be conducted at up to 35 centers in
the United States and which was
recently approved by the FDA.
Results for the quarters ended September 30, 2017 and 2016
Revenues
Revenues decreased 55% to $1,374,893 for the three months ended
September 30, 2017, compared to
revenues of $3,034,000 for the same
period in 2016. The Company continues to focus its business
away from its traditional revenue streams towards development and
commercialization of its own products, the Reducer and the Tiara.
The Company anticipates that by the end of 2018 all revenue will be
derived from the Reducer product only.
Sales of the Reducer for the three months ended September 30, 2017 were $334,208, compared to $262,546 for the same period in 2016,
representing an increase of 27%. This represents a new
quarterly revenue high. The Company is encouraged by the
progress this quarter, but recognizes that future quarterly
revenues may be unstable before the Reducer becomes widely
adopted. The continued success of the commercialization of
the Reducer will be dependent on the amount of internal resources
allocated to the product, obtaining appropriate reimbursement codes
in various territories and correctly managing the referrals
process.
Contract manufacturing revenues for the three months ended
September 30, 2017 were $197,494, compared to $1,543,516 for the same period in 2016,
representing a decrease of 87%. The decrease in revenue for
the three months ended September 30,
2017 compared to the same period in 2016 is primarily due to
the loss of Boston Scientific as a customer. In December,
2016, the Company entered into an agreement for Boston Scientific
to acquire the Company's advanced biologic tissue capabilities and
certain manufacturing assets and make a 15% equity investment in
Neovasc, for a total of $75 million in cash. Under
the terms of the $68 million asset
purchase agreement the Company has been granted a license to the
purchased trade secrets and know-how and access to the sold
facilities to allow it to continue its tissue and valve assembly
activities for its remaining customers, and continue its own
tissue-related programs, including advancing the Tiara through its
clinical and regulatory pathways. The Company believes that
going forward contract manufacturing revenues will be derived from
a smaller customer base as the transcatheter aortic valve market
matures.
Revenues from consulting services for the three months ended
September 30, 2017 were $843,191, compared to $1,227,938 for the same period in 2016,
representing a decrease of 31%. The loss is indicative of the
trend the Company is seeing in consulting service revenue.
The Company anticipates that its consulting services revenue will
decline in the long-term as its consulting customers continue to
transition to becoming contract manufacturing customers or cease to
be customers at all.
Cost of Goods Sold
The cost of goods sold for the
three months ended September 30, 2017
was $659,686, compared to
$2,201,440 for the same period in
2016. The overall gross margin for the three months ended
September 30, 2017 was 52%, compared
to 27% gross margin for the same period in 2016. The Company
has seen its gross margins increase due to a change in the product
mix as Reducer revenues reflect an increasing proportion of the
overall revenues.
Expenses
Total expenses for the three months ended
September 30, 2017 were $6,540,734, compared to $8,418,400 for the same period in 2016,
representing a decrease of $1,877,666
or 22%. The decrease in total expenses for the three months
ended September 30, 2017 compared to
the same period in 2016 reflects a $1,602,523 reduction in general and
administrative expenses (of which $1,345,033 relates to a decrease in litigation
expenses) and a $320,050 decrease in
product development and clinical trial expenses to preserve cash
resources.
Selling expenses for the three months ended September 30, 2017 were $253,791, compared to $208,884 for the same period in 2016,
representing an increase of $44,907,
or 21%. The increase in selling expenses for the three months
ended September 30, 2017 compared to
the same period in 2016 reflects an increase in costs incurred for
commercialization activities related to the Reducer. The
Company continues to minimize its selling expenses in the light of
ongoing litigation costs and the impact of litigation on the
Company.
General and administrative expenses for the three months ended
September 30, 2017 were $1,864,302, compared to $3,466,825 for the same period in 2016,
representing a decrease of $1,602,523
or 46%. The decrease in general and administrative expenses
for the three months ended September 30,
2017 compared to the same period in 2016 can be
substantially explained by a $1,345,033 decrease in litigation expenses.
Product development and clinical trial expenses for the three
months ended September 30, 2017 were
$4,422,641 compared to $4,742,691 for the same period in 2016,
representing a decrease of $320,050
or 7%. The decrease in product development and clinical trial
expenses for the three months ended September 30, 2017 was due to a $497,662 decrease in cash-based employee
expenses.
Other Loss
The other income for the three months ended
September 30, 2017 was $1,473,493, compared to a loss of $21,461,950 for the same period in 2016, an
increase in other income of $22,935,443. The increase in the other
income can be substantially explained by a $21 million decrease in the charge for the
damages provision. Included within other income for the three
months ended September 30, 2017 is a
charge of $216,593 for post-judgment
interest on the damages provision related to the litigation with
CardiAQ, (2016: $nil).
Losses
The operating losses and comprehensive losses
for the three months ended September 30,
2017 were $4,695,960 and
$5,807,836, respectively, or
$0.06 basic and diluted loss per
share, as compared with losses of $29,135,086 and $28,836,990, or $0.44 basic and diluted loss per share, for the
same period in 2016. The $24,439,126 decrease in the operating loss
incurred for the three months ended September 30, 2017 compared to the same period in
2016 consists of a $21 million
enhanced damages provision against the Company in its litigation
with CardiAQ charged in three months ended September 30, 2016 and a $1,602,523 reduction in general and
administrative expenses (of which, $1,345,033 relates to a decrease in litigation
expenses) and a $2,039,146 increase
in foreign exchange gains. Litigation expenses for the three
and nine months ended September 30,
2017 represent a loss of $0.01
and $0.03 basic and diluted loss per
share compared to a loss of $0.03 and
$0.18 basic and diluted loss per
share for the same period in 2016. The charges for the damages
provision for the three and nine months ended September 30, 2016 represent a loss of
$0.31 and $1.36 basic and diluted loss per share. To
date, the Company has incurred significant costs in defending
itself in lawsuits filed by CardiAQ. Total litigation
expenses since the initial claims were filed in June 2014 are $23.0
million and the Company expects that it may require an
additional $1.0 million related to
the ongoing appeal in Germany.
Discussion of Liquidity and Capital Resources
Neovasc
finances its operations and capital expenditures with cash
generated from operations and equity financings. As at
September 30, 2017 the Company had
cash and cash equivalents of $6,268,113 compared to cash and cash equivalents
of $22,954,571 as at December 31, 2016. The Company's working
capital deficit is $35,234,565 as at
June 30, 2017 compared to a working
capital deficit of $17,497,931 as at
December 31, 2016.
Cash used in operating activities for the three months ended
September 30, 2017, was $4,041,228, compared to $11,117,648 for the same period in 2016.
For the three months ended September 30,
2017, operating expenses were $3,787,729, compared to $7,364,783 for the same period in 2016, a
decrease of $3,577,054. This
can substantially be explained by a decrease in litigation expenses
of $1,345,033.
Net cash applied to investing activities for the three months
ended September 30, 2017, was
$186,847 compared to $15,174 in 2016.
Net cash provided by financing activities for the three months
ended September 30, 2017, was
$10,486, compared to $nil for the
same period in 2016 from the proceeds of options.
The majority of the revenue and expenses of the Company are
incurred in the parent and in one of its subsidiaries, NMI, both of
which are Canadian companies. There were no significant
restrictions on the transfer of funds between these entities and
during the three months ended September 30,
2017 and 2016 the Company had no complications in
transferring funds to and from its subsidiaries in Israel and the
United States.
The Company is exposed to foreign currency fluctuations on
$2,338,043 of its cash and cash
equivalents held in U.S. dollars and Euros.
Subsequent Events
FDA Approval for Reducer
On November 3, 2017, the Company received approval
of the FDA to initiate the COSIRA-II IDE pivotal clinical
trial. The trial's purpose will be to demonstrate the safety
and effectiveness of the Company's novel Reducer system for
treatment of patients with refractory angina. Once completed, the
trial data is intended to support an application to the FDA for
approval to begin marketing Reducer in the United States.
Court Matters
On October 2,
2017, Neovasc petitioned the
United States Court of Appeals for the Federal Circuit (the
"Appeals Court") for an en banc rehearing. CardiAQ also filed
a petition with the Appeals Court for panel rehearing and en banc
rehearing as to the trial court's denial of its request for an
18-month injunction against the Tiara devices. On
November 3, 2017 the Appeals Court
denied the petition for panel rehearing and en banc rehearing filed
by CardiAQ and denied the petition for en banc rehearing filed by
the Company. On November 13, 2017, the final mandate was
issued by the Appeals Court, approximately $70 million was released from escrow to CardiAQ
to partially settle approximately $112
million damages and interest awards and approximately
$42 million is now due and
payable.
Financing
On November 9,
2017, the Company announced a placement of debt and equity
for gross proceeds of approximately $65
million. Assuming successful completion of the
transaction, the Company intends to use the net proceeds to fully
fund the approximately $42
million balance of the awards granted in the litigation with
CardiAQ (after subtracting the approximately $70 million that the Company has paid into
escrow), with remaining funds being used (i) to partially fund the
ongoing Tiara clinical program; (ii) to support the completion of
the TIARA-II study; and (iii) for general corporate purposes.
Further details regarding the financing can be found in the
Company's press release, dated November 9,
2017, and in Management's Discussion and Analysis for the
Third Quarter of 2017.
Remedial TSX Delisting Review
On November 13, 2017, the TSX reported that Neovasc
Inc. is under a remedial delisting review. The Company has 120 days
to regain compliance with the exchange's continued listing
requirements. It has been the practice of TSX to place a
listed issuer relying on the financial hardship exemption under
review for continued listing. While the TSX believes that these
measures contribute to limiting reliance by listed issuers on the
financial hardship exemption, particularly because of the current
challenging economic times, the TSX seeks to ensure that the
financial hardship exemption is being used appropriately. The
Company will respond to TSX requests for information and remains
hopeful that the Company will be permitted to remain listed on the
exchange.
Going Concern
On November 13, 2017, the final
mandate was issued by the Appeals Court, approximately $70 million was paid from escrow to CardiAQ to
partially settle approximately $112
million damages and interest awards and approximately
$42 million is now due and
payable. On November 9, 2017,
the Company announced a financing for gross proceeds of
approximately $65 million. The
financing is expected to close on November
17, 2017 upon satisfaction of the closing conditions and the
Company intends to use approximately $42
million from the proceeds to settle the remaining
awards. These circumstances indicate the existence of
material uncertainty and cast substantial doubt about the Company's
ability to continue as a going concern.
Outstanding Share Data
As at November 14, 2017, the Company had 78,920,688
common voting shares issued and outstanding. Further, the
following securities are convertible into common shares of the
Company: 9,203,242 stock options with a weighted average price of
C$3.54. The fully diluted share
capital of the Company at November 14,
2017 is 88,123,930. However, should the financing be
completed there will be significant further issuance of common
shares as well as warrants and convertible notes that are
exercisable or convertible into common shares.
The Company prepares its consolidated financial statements in
accordance with International Financial Reporting Standards, as
issued by the International Accounting Standards Board.
Neovasc's third quarter 2017 financial statements and notes and
its Management's Discussion and Analysis will be posted on the
Company's website at www.neovasc.com and will be filed on
SEDAR and EDGAR. In addition to the summary contained herein,
readers are encouraged to review the full disclosure in Neovasc's
third quarter 2017 financial statements and Management's Discussion
and Analysis.
Conference Call and Webcast information
Neovasc will
be hosting a conference call today at 4:30 pm ET to
discuss these results. To participate in the conference, dial
888 390 0605 or 416 764 8609. A recording of the call will be
available for 72 hours by calling 888 390 0541 or 416 764 8677 and
using passcode 762334#. A link to the live and archived audio
webcast of the conference call will also be available on the
Presentations and Events page of the Investors section
of Neovasc's website at www.neovasc.com.
NEOVASC
INC.
|
Condensed Interim
Consolidated Statements of Financial Position
|
(Expressed in U.S.
dollars) (Unaudited)
|
|
|
|
|
|
|
September
30,
|
December
31,
|
|
|
2017
|
2016
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
6,268,113
|
$
|
22,954,571
|
|
|
Cash held in
escrow
|
|
70,321,442
|
70,000,000
|
|
|
Accounts
receivable
|
|
1,393,568
|
3,117,474
|
|
|
Inventory
|
|
471,567
|
196,723
|
|
|
Prepaid expenses and
other assets
|
|
1,048,560
|
505,340
|
|
Total current
assets
|
|
79,503,250
|
96,774,108
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
Restricted
cash
|
|
480,780
|
449,760
|
|
|
Property, plant and
equipment
|
|
1,772,226
|
1,585,635
|
|
Total non-current
assets
|
|
2,253,006
|
2,035,395
|
|
|
|
|
Total
assets
|
|
$
|
81,756,256
|
$
|
98,809,503
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Liabilities
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
|
2,314,003
|
$
|
2,490,943
|
|
|
Damages
provision
|
|
112,423,812
|
111,781,096
|
|
Total current
liabilities and total liabilities
|
|
114,737,815
|
114,272,039
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Share
capital
|
|
169,182,621
|
168,712,673
|
|
|
Contributed
surplus
|
|
24,145,117
|
22,301,437
|
|
|
Accumulated other
comprehensive loss
|
|
(6,643,436)
|
(4,693,040)
|
|
|
Deficit
|
|
(219,665,861)
|
(201,783,606)
|
|
Total
equity
|
|
(32,981,559)
|
(15,462,536)
|
|
|
|
|
Total liabilities
and equity
|
|
$
|
81,756,256
|
$
|
98,809,503
|
NEOVASC
INC.
|
Consensed Interim
Consolidated Statements of Loss and Comprehensive
Loss
|
For the three and
nine months ended September 30,
|
(Expressed in U.S.
dollars) (Unaudited)
|
|
|
For the three months
ended
September
30,
|
For the nine months
ended
September
30,
|
|
2017
|
2016
|
2017
|
2016
|
|
|
|
|
|
REVENUE
|
|
|
|
|
Reducer
|
$
|
334,208
|
$
|
262,546
|
$
|
842,528
|
$
|
722,433
|
Contract
manufacturing
|
197,494
|
1,543,516
|
484,174
|
2,391,136
|
Consulting
services
|
843,191
|
1,227,938
|
2,834,687
|
3,638,105
|
|
1,374,893
|
3,034,000
|
4,161,389
|
6,751,674
|
|
|
|
|
|
COST OF GOODS
SOLD
|
659,686
|
2,201,440
|
2,341,017
|
5,038,792
|
GROSS
PROFIT
|
715,207
|
832,560
|
1,820,372
|
1,712,882
|
|
|
|
|
|
EXPENSES
|
|
|
|
|
Selling
expenses
|
253,791
|
208,884
|
665,341
|
554,905
|
General and
administrative expenses
|
1,864,302
|
3,466,825
|
7,366,234
|
16,721,354
|
Product development
and clinical trials expenses
|
4,422,641
|
4,742,691
|
13,726,944
|
14,530,513
|
|
6,540,734
|
8,418,400
|
21,758,519
|
31,806,772
|
|
|
|
|
|
OPERATING
LOSS
|
(5,825,527)
|
(7,585,840)
|
(19,938,147)
|
(30,093,890)
|
|
|
|
|
|
OTHER
INCOME/(EXPENSE)
|
|
|
|
|
Interest
income
|
138,613
|
25,723
|
355,837
|
161,522
|
Interest on damages
provision
|
(216,593)
|
-
|
(642,716)
|
-
|
Damages
provision
|
-
|
(21,000,000)
|
-
|
(91,000,000)
|
Foreign exchange
(loss)/gain
|
(8,951,113)
|
88,584
|
(5,661,951)
|
(2,014,669)
|
Unrealized
gain/(loss) on damages provision
|
10,502,586
|
(576,257)
|
8,463,548
|
(576,257)
|
|
1,473,493
|
(21,461,950)
|
2,514,718
|
(93,429,404)
|
LOSS BEFORE
TAX
|
(4,352,034)
|
(29,047,790)
|
(17,423,429)
|
(123,523,294)
|
|
|
|
|
|
Tax
expense
|
(343,926)
|
(87,296)
|
(458,826)
|
(185,390)
|
|
|
|
|
|
LOSS FOR THE
PERIOD
|
$
|
(4,695,960)
|
$
|
(29,135,086)
|
$
|
(17,882,255)
|
$
|
(123,708,684)
|
|
|
|
|
|
OTHER
COMPREHENSIVE (LOSS)/INCOME
FOR THE PERIOD
|
|
|
|
|
Exchange difference
on translation
|
9,390,710
|
(278,161)
|
6,513,152
|
3,639,481
|
Unrealized
gain/(loss) on damages provision
|
(10,502,586)
|
576,257
|
(8,463,548)
|
576,257
|
|
(1,111,876)
|
298,096
|
(1,950,396)
|
4,215,738
|
|
|
|
|
|
LOSS AND
COMPREHENSIVE LOSS FOR THE
|
|
|
|
|
PERIOD
|
$
|
(5,807,836)
|
$
|
(28,836,990)
|
$
|
(19,832,651)
|
$
|
(119,492,946)
|
|
|
|
|
|
LOSS PER
SHARE
|
|
|
|
|
Basic and diluted
loss per share
|
$
|
(0.06)
|
$
|
(0.44)
|
$
|
(0.23)
|
$
|
(1.85)
|
NEOVASC
INC.
|
Condensed Interim
Consolidated Statements of Cash Flows
|
For the three and
nine months ended September 30,
|
(Expressed in U.S.
dollars) (Unaudited)
|
|
|
For the three months
ended
September
30,
|
For the nine months
ended
September
30,
|
|
2017
|
2016
|
2017
|
2016
|
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
Loss for the
period
|
$
|
(4,695,960)
|
$
|
(29,135,086)
|
$
|
(17,882,255)
|
$
|
(123,708,684)
|
Adjustments
for:
|
|
|
|
|
|
Depreciation
|
142,034
|
215,108
|
387,762
|
562,088
|
|
Share-based
payments
|
343,155
|
580,221
|
2,078,675
|
1,811,210
|
|
Damages
provision
|
216,593
|
21,000,000
|
642,716
|
91,000,000
|
|
Write-down accounts
receivable
|
-
|
697
|
40,000
|
5,556
|
|
Income tax
expense
|
345,062
|
-
|
461,097
|
-
|
|
Interest
income
|
(138,613)
|
(25,723)
|
(355,837)
|
(161,522)
|
|
(3,787,729)
|
(7,364,783)
|
(14,627,842)
|
(30,491,352)
|
|
|
|
|
|
Net change in
non-cash working capital items:
|
|
|
|
|
|
Accounts
receivable
|
178,735
|
(980,522)
|
1,809,123
|
(1,154,457)
|
|
Inventory
|
(29,795)
|
510,269
|
(247,403)
|
(409,886)
|
|
Prepaid expenses and
other assets
|
(91,780)
|
20,642
|
(481,560)
|
(234,565)
|
|
Accounts payable and
accrued liabilities
|
(204,279)
|
(3,326,228)
|
(577,616)
|
(940,349)
|
|
(147,119)
|
(3,775,839)
|
502,544
|
(2,739,257)
|
|
|
|
|
|
Interest
received
|
8,236
|
22,974
|
112,067
|
159,294
|
Income tax
paid
|
(114,616)
|
-
|
(229,516)
|
-
|
|
(106,380)
|
22,974
|
(117,449)
|
159,294
|
|
|
|
|
|
Net cash applied
to operating activities
|
(4,041,228)
|
(11,117,648)
|
(14,242,747)
|
(33,071,315)
|
|
|
|
|
|
INVESTING
ACTIVITES
|
|
|
|
|
|
Increase in cash held
in escrow
|
(131,258)
|
-
|
(321,442)
|
-
|
|
Purchase of property,
plant and equipment
|
(55,589)
|
(15,174)
|
(445,930)
|
(546,709)
|
Net cash applied
to investing activities
|
(186,847)
|
(15,174)
|
(767,372)
|
(546,709)
|
|
|
|
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
Proceeds from
exercise of options
|
10,486
|
-
|
234,953
|
75,192
|
Net cash received
from financing activities
|
10,486
|
-
|
234,953
|
75,192
|
|
|
|
|
|
NET CHANGE IN CASH
AND CASH EQUIVALENTS
|
(4,217,589)
|
(11,132,822)
|
(14,775,166)
|
(33,542,832)
|
|
|
|
|
|
CASH AND CASH
EQUIVALENTS
|
|
|
|
|
Beginning of the
period
|
11,580,940
|
36,277,793
|
22,954,571
|
55,026,171
|
Exchange difference
on cash and cash equivalents
|
(1,095,238)
|
335,712
|
(1,911,292)
|
3,997,344
|
End of the
period
|
$
|
6,268,113
|
$
|
25,480,683
|
$
|
6,268,113
|
$
|
25,480,683
|
|
|
|
|
|
Represented
by:
|
|
|
|
|
Cash
|
6,268,113
|
14,390,173
|
6,268,113
|
14,390,173
|
Cashable high
interest savings accounts
|
-
|
11,090,510
|
-
|
11,090,510
|
|
$
|
6,268,113
|
$
|
25,480,683
|
$
|
6,268,113
|
$
|
25,480,683
|
About Neovasc Inc.
Neovasc is a specialty medical device company that develops,
manufactures and markets products for the rapidly growing
cardiovascular marketplace. Its products include the Neovasc
Reducer™, for the treatment of refractory angina which is not
currently available in the United
States and has been available in Europe since 2015 and the Tiara™, for the
transcatheter treatment of mitral valve disease, which is currently
under investigation in the United
States, Canada and
Europe. The Company also sells a
line of advanced biological tissue products that are used as key
components in third-party medical products including transcatheter
heart valves. For more information, visit: www.neovasc.com.
This news release contains forward-looking statements within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995 and applicable Canadian securities laws regarding the
Company's plans and expectations concerning its business, results
of operations and financial condition, the performance of its two
lead devices, the anticipated timing for enrolment for our European
trial for Tiara, the Company's expectation that all revenue will be
derived from the Reducer by the end of 2018, the Company's
expectations regarding contract manufacturing revenues, the trend
in consulting service revenue, the Company's expectation that the
trial data from the COSIRA-II clinical trial will support an
application to the FDA for approval to begin marketing Reducer in
the United States, the anticipated
completion of the Company's financing (including the expected
closing date) and its intended use of proceeds, and other
statements of a forward-looking nature. Words and phrases
such as "intends", "expects", "continue", "advance",
"proceed", "anticipates", "believes", "going forward", "trend",
"hopeful" and "will", and similar words or expressions, are
intended to identify these forward-looking statements.
Forward-looking statements are based on estimates and assumptions
made by the Company in light of its experience and its perception
of historical trends, current conditions and expected future
developments, as well as other factors that the Company believes
are appropriate in the circumstances. Many factors and
assumptions could cause the Company's actual results, performance
or achievements to differ materially from those expressed or
implied by the forward-looking statements, including, without
limitation, risks relating to the Company's litigation with
CardiAQ, including the Company's ability to successfully satisfy
the damages and interest awards affirmed by the Appeals Court,
which create material uncertainty and which cast substantial doubt
on the Company's ability to continue as a going concern; the
substantial doubt about the Company's ability to continue as a
going concern; risks relating to the Company's need for significant
additional future capital and the Company's ability to raise
additional funding; risks relating to the closing of the financing,
which are subject to various closing conditions, including the
listing of the common shares and the common shares issuable upon
exercise or conversion of the warrants and convertible notes issued
in the financing, risks relating to the warrants and convertible
notes issued in the financing resulting in significant dilution to
the Company's shareholders, risks relating to the possibility that
the Company's common shares may be delisted from Nasdaq or the TSX,
risks related to the Company's common share price being volatile,
risks relating to the restrictions on the Company entering into
certain transactions, and risks relating to short sales by third
parties in connection with the financing; risks relating to claims
by third parties alleging infringement of their intellectual
property rights; the Company's ability to establish, maintain and
defend intellectual property rights in the Company's products;
risks relating to results from clinical trials of the Company's
products, which may be unfavorable or perceived as unfavorable; the
Company's history of losses and significant accumulated deficit;
risks associated with product liability claims, insurance and
recalls; risks relating to competition in the medical device
industry, including the risk that one or more competitors may
develop more effective or more affordable products; risks relating
to the Company's ability to achieve or maintain expected levels of
market acceptance for the Company's products, as well as the
Company's ability to successfully build the Company's in-house
sales capabilities or secure third-party marketing or distribution
partners; the Company's ability to convince public payors and
hospitals to include the Company's products on their approved
products lists; risks relating to new legislation, new regulatory
requirements and the efforts of governmental and third party payors
to contain or reduce the costs of healthcare; risks relating to
increased regulation, enforcement and inspections of participants
in the medical device industry, including frequent government
investigations into marketing and other business practices; risks
associated with the extensive regulation of the Company's products
and trials by governmental authorities, as well as the cost and
time delays associated therewith; risks associated with post-market
regulation of the Company's products; health and safety risks
associated with the Company's products and the Company's industry;
risks associated with the Company's manufacturing operations,
including the regulation of the Company's manufacturing processes
by governmental authorities and the availability of two critical
components of the Reducer; risk of animal disease associated with
the use of the Company's products; risks relating to the
manufacturing capacity of third-party manufacturers for the
Company's products, including risks of supply interruptions
impacting the Company's ability to manufacture its own products;
risks relating to breaches of anti-bribery laws by the Company's
employees or agents; risks associated with future changes in
financial accounting standards and new accounting pronouncements;
the Company's dependence upon key personnel to achieve the
Company's business objectives; the Company's ability to maintain
strong relationships with physicians; risks relating to the
sufficiency of the Company's management systems and resources in
periods of significant growth; risks associated with consolidation
in the health care industry, including the downward pressure on
product pricing and the growing need to be selected by larger
customers in order to make sales to their members or participants;
the Company's ability to successfully identify and complete
corporate transactions on favorable terms or achieve anticipated
synergies relating to any acquisitions or alliances; anti-takeover
provisions in the Company's constating documents which could
discourage a third party from making a takeover bid beneficial to
the Company's shareholders; risks relating to conflicts of
interests among the Company's officers and directors as a result of
their involvement with other issuers; and risks relating to the
influence of significant shareholders of the Company over the
Company's business operations and share price. These risk
factors and others relating to the Company are discussed in greater
detail in the "Risk Factors" section of the Company's Annual
Information Form and in the Company's Management's Discussion and
Analysis of Financial Condition and Results of Operations (copies
of which filings may be obtained at www.sedar.com or www.sec.gov,
each of which are included in the Company's Annual Report on Form
40-F) as well as in the "Risks Related to the Financings" section
of the Company's Management's Discussion and Analysis for the third
quarter of 2017, which may be obtained at www.sedar.com or
www.sec.gov. These factors should be considered carefully,
and readers should not place undue reliance on the Company's
forward-looking statements. The Company has no intention and
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
SOURCE Neovasc Inc.