electroCore, Inc. (Nasdaq: ECOR), a commercial-stage bioelectronic
medicine company, today announced third quarter 2021 financial
results and provided an operational update.
Third Quarter 2021 and Recent Highlights
- Revenue of $1.5 million, representing an increase of 17%
sequentially and 38% over third quarter 2020
- Gross margin expanded to 76%
- Net cash used to fund operations was $3.4 million, leaving
approximately $39.0 million of cash, cash equivalents, and
marketable securities at September 30, 2021
Dan Goldberger, Chief Executive Officer of electroCore,
commented, “We are pleased that our third quarter results continue
to show steady sequential revenue growth, despite the impact of the
pandemic on our headache markets in the U.S. and U.K.” Mr.
Goldberger added: “Revenue for the quarter was $1.5 million and we
continue to be confident about the growth prospects of the
business. Our cash balance, including our marketable securities, of
$39.0 million at September 30, 2021, puts the company in an
excellent position to execute on its strategy.”
Third Quarter 2021 Financial Results For
the quarter ended September 30, 2021, electroCore reported net
sales of $1.5 million compared to $1.3 million in the second
quarter of 2021 and $1.1 million during same period of 2020. This
represents a quarterly revenue increase of 17% sequentially and 38%
over the same period last year.
Revenue from the Department of Veterans Affairs (“VA”) and
Department of Defense (“DOD”) increased 21% sequentially to
$946,000 in the third quarter of 2021 from $779,000 in the second
quarter of 2021 and increased 46% as compared to $646,000 in the
third quarter of 2020.
96 VA and DoD military treatment facilities have purchased
gammaCore products through September 30, 2021 as compared to 85
facilities through the June 2021 and 67 facilities through the
third quarter of 2020.
Revenue from outside the United States through direct sales
channels was flat sequentially to $371,000 in the third quarter of
2021, as compared to $369,000 during the second quarter of 2021 and
increased 33% from $278,000 during the third quarter of 2020. These
figures do not include global stocking distributors in other
countries which contributed $12,000 of net sales.
Gross profit for the third quarter of 2021 was $1.1 million as
compared to $895,000 for the second quarter of 2021 and $733,000
for the third quarter of 2020. Gross margin for the third
quarter of 2021 was 76%, compared to 71% in the second quarter of
2021 and 68% in the third quarter of 2020.
Total operating expenses in the third quarter of 2021 were
approximately $5.1 million, a reduction of approximately $1.0
million from $6.1 million in the second quarter of 2021. Operating
expenses decreased by $100,000 from $5.2 million in the third
quarter of 2020.
Research and development expense in the third quarter of 2021
was $470,000 as compared to $825,000 in the second quarter of 2021,
a decrease of approximately $355,000 sequentially. Research and
development expense decreased by $159,000 from $629,000 during the
third quarter of 2020.
Selling, general and administrative expense in the third quarter
of 2021 was $4.6 million as compared to $5.3 million in the second
quarter of 2021. Selling, general and administrative expense was
flat compared to the third quarter of 2020.
GAAP net loss in the third quarter of 2021 was $4.0 million
compared to a GAAP net loss of $2.9 million in the second quarter
of 2021. GAAP net loss decreased by 11% or $500,000 as compared to
a GAAP net loss of $4.5 million in the third quarter of 2020. In
the second quarter of 2021, the company recorded a total gain of
$2.3 million on the extinguishment of debt and a tax benefit from
the sale of New Jersey NOL carryforwards.
Adjusted EBITDA net loss in the third quarter of 2021 was $3.1
million as compared to $4.1 million during the second quarter of
2021 and as compared to adjusted EBITDA net loss of $3.3 million in
the third quarter of 2020.
The company defines adjusted EBITDA net loss as GAAP net loss,
excluding depreciation and amortization, stock-compensation
expense, restructuring and other severance related charges, legal
fees associated with stockholders’ litigation, total other
income/expense, extinguishment of debt, and provision/ benefit from
income taxes. A reconciliation of GAAP net loss to Non-GAAP
adjusted EBITDA net loss has been provided in the financial
statement tables included in this press release.
Net cash used in operating activities during the quarter ended
September 30, 2021, was approximately $3.4 million as compared to
$3.2 million in the second quarter of 2021, and $4.1 million in the
third quarter of 2020. The second quarter of 2021 amount is
exclusive of cash proceeds from the sale of NOL carryforwards.
Cash, cash equivalents and marketable securities at September
30, 2021, totaled approximately $39.0 million, as compared to
approximately $23.7 million at June 30, 2021. During the third
quarter, the company raised net proceeds of approximately $18.8
million through a public offering of 20,700,000 shares of its
common stock. The Company believes its cash and marketable
securities will enable it to fund its operating expenses and
capital expenditure requirements, as currently planned, for at
least the next 12 months.
Webcast and Conference Call
InformationelectroCore’s management team will host a
conference call today, November 4, 2021, beginning at 4:30 pm
ET.
Investors interested in listening to the conference call, or
webcast may do so by dialing 877-269-7756 (Toll Free) or
201-689-7817 (Toll), or by connecting to the Web: electroCore 3Q21
Earnings Webcast
An archived webcast of the event will be available on the
“Investors” section of the company’s website at:
www.electrocore.com.
About electroCore, Inc.electroCore, Inc. is a
commercial stage bioelectronic medicine company dedicated to
improving patient outcomes through its non-invasive vagus nerve
stimulation therapy platform, initially focused on the treatment of
multiple conditions in neurology. The company's current indications
are the preventive treatment of cluster headache and migraine, the
acute treatment of migraine and episodic cluster headache, the
acute and preventive treatment of migraines in adolescents, and
paroxysmal hemicrania and hemicrania continua in adults.
For more information, visit www.electrocore.com.
About gammaCoreTMgammaCoreTM
(nVNS) is the first non-invasive, hand-held medical therapy applied
at the neck as an adjunctive therapy to treat migraine and cluster
headache through the utilization of a mild electrical stimulation
to the vagus nerve that passes through the skin. Designed as a
portable, easy-to-use technology, gammaCore can be
self-administered by patients, as needed, without the potential
side effects associated with commonly prescribed drugs. When placed
on a patient’s neck over the vagus nerve, gammaCore stimulates the
nerve’s afferent fibers, which may lead to a reduction of pain in
patients.
gammaCore (nVNS) is FDA cleared in the United States for
adjunctive use for the preventive treatment of cluster headache in
adult patients, the acute treatment of pain associated with
episodic cluster headache in adult patients, and the acute and
preventive treatment of migraine in adolescent (ages 12 and older)
and adult patients. gammaCore is CE-marked in the European Union
for the acute and/or prophylactic treatment of primary headache
(Migraine, Cluster Headache, Trigeminal Autonomic Cephalalgias and
Hemicrania Continua) and Medication Overuse Headache in adults.
gammaCore is contraindicated for patients if they:
- Have an active implantable medical device, such as a pacemaker,
hearing aid implant, or any implanted electronic device
- Have a metallic device, such as a stent, bone plate, or bone
screw, implanted at or near the neck
- Are using another device at the same time (e.g., TENS Unit,
muscle stimulator) or any portable electronic device (e.g., mobile
phone)
Safety and efficacy of gammaCore have not been evaluated in the
following patients:
- Adolescent patients with congenital cardiac issues
- Patients diagnosed with narrowing of the arteries (carotid
atherosclerosis)
- Patients who have had surgery to cut the vagus nerve in the
neck (cervical vagotomy)
- Pediatric patients (less than 12 years)
- Pregnant women
- Patients with clinically significant hypertension, hypotension,
bradycardia, or tachycardia
Please refer to the gammaCore Instructions for Use for all of
the important warnings and precautions before using or prescribing
this product.
The U.S. FDA has cleared the gammaCore Sapphire CV (nVNS) device
under an emergency use authorization for acute use at home or in a
healthcare setting to treat adult patients with known or suspected
COVID-19 who are experiencing an exacerbation of asthma-related
dyspnea and reduced airflow, and for whom approved pharmacologic
therapies are not tolerated or provide insufficient symptom relief
as assessed by their healthcare provider, using noninvasive vagus
nerve stimulation (nVNS) on either side of the patient's neck.
gammaCore Sapphire CV has been authorized only for the duration
of the statement that circumstances exist that warrant
authorization of the emergency use of medical devices under section
564(b)(1) of the Act, 21 U.S.C. § 360bbbb-3(b)(1), until the
authorization is terminated or revoked.
More information can be found at:Letter of authorization:
https://www.fda.gov/media/139967/downloadFact sheet for healthcare
workers: https://www.fda.gov/media/139968/downloadPatient
information sheet:
https://www.fda.gov/media/139969/downloadInstructions for use of
gammaCore: https://www.fda.gov/media/139970/download
Forward-Looking StatementsThis press release
may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements include, but are not limited to,
statements about electroCore’s expectations for revenue and cash
used in operations during the third quarter of 2021, its
expectations for future performance, as well as electroCore's
business prospects and clinical and product development plans for
2021 and beyond, its pipeline or potential markets for its
technologies, additional indications for gammaCore, the timing,
outcome and impact of regulatory, clinical and commercial
developments (including human trials for the study of headache,
PTH, mTBI, Parkinson’s diseases and sleep deprivation stress and
the business, operating or financial impact of such studies),
further international expansion, and statements about anticipated
distribution arrangements, government and payor funding
arrangements (including those relating to Canada, Western Europe,
Qatar, Taiwan, and China) and other statements that are not
historical in nature, particularly those that utilize terminology
such as "anticipates," "will," "expects," "believes," "intends,"
other words of similar meaning, derivations of such words and the
use of future dates. Actual results could differ from those
projected in any forward-looking statements due to numerous
factors. Such factors include, among others, the ability to raise
the additional funding needed to continue to pursue electroCore’s
business and product development plans, the inherent uncertainties
associated with developing new products or technologies, the
ability to commercialize gammaCore™, competition in the industry in
which electroCore operates and overall market conditions. Any
forward-looking statements are made as of the date of this press
release, and electroCore assumes no obligation to update the
forward-looking statements or to update the reasons why actual
results could differ from those projected in the forward-looking
statements, except as required by law. Investors should consult all
of the information set forth herein and should also refer to the
risk factor disclosure set forth in the reports and other documents
electroCore files with the SEC available at www.sec.gov.
Investors:Rich CockrellCG
Capital404-736-3838ecor@cg.capital
or
Media Contact:Jackie
DorskyelectroCore908-313-6331Jackie.dorsky@electrocore.com
electroCore,
Inc.Condensed Consolidated Statements of
Operations(Unaudited)(in thousands, except per share
data)
|
|
Three
months |
|
Nine
months |
ended September 30, |
|
ended September 30, |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Net sales |
|
$ |
1,487.1 |
|
|
$ |
1,080.9 |
|
|
$ |
3,960.4 |
|
|
$ |
2,567.6 |
|
Cost of
goods sold |
|
|
355.0 |
|
|
|
347.5 |
|
|
|
1,093.3 |
|
|
|
918.6 |
|
Gross profit |
|
|
1,132.1 |
|
|
|
733.4 |
|
|
|
2,867.1 |
|
|
|
1,649.0 |
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
470.3 |
|
|
|
629.1 |
|
|
|
1,794.1 |
|
|
|
3,182.7 |
|
Selling, general and administrative |
|
|
4,646.8 |
|
|
|
4,592.9 |
|
|
|
15,644.3 |
|
|
|
16,427.0 |
|
Restructuring and other severance related
charges |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
464.6 |
|
Total operating
expenses |
|
|
5,117.1 |
|
|
|
5,222.0 |
|
|
|
17,438.4 |
|
|
|
20,074.3 |
|
Loss from operations |
|
|
(3,985.0 |
) |
|
|
(4,488.6 |
) |
|
|
(14,571.3 |
) |
|
|
(18,425.3 |
) |
Other
(income) expense |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on extinguishment of debt |
|
|
- |
|
|
|
- |
|
|
|
(1,422.2 |
) |
|
|
- |
|
Interest and other income |
|
|
(3.8 |
) |
|
|
(5.8 |
) |
|
|
(8.4 |
) |
|
|
(80.5 |
) |
Other expense |
|
|
3.8 |
|
|
|
3.6 |
|
|
|
7.3 |
|
|
|
13.4 |
|
Total other
(income) expense |
|
|
- |
|
|
|
(2.2 |
) |
|
|
(1,423.3 |
) |
|
|
(67.1 |
) |
Loss before
income taxes |
|
|
(3,985.0 |
) |
|
|
(4,486.4 |
) |
|
|
(13,148.0 |
) |
|
|
(18,358.2 |
) |
(Provision)
benefit from income taxes |
|
|
(8.7 |
) |
|
|
- |
|
|
|
876.7 |
|
|
|
1,170.9 |
|
Net
loss |
|
$ |
(3,993.7 |
) |
|
$ |
(4,486.4 |
) |
|
$ |
(12,271.3 |
) |
|
$ |
(17,187.3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share of common stock - Basic and Diluted |
|
$ |
(0.06 |
) |
|
$ |
(0.10 |
) |
|
$ |
(0.22 |
) |
|
$ |
(0.47 |
) |
Weighted
average number of common shares outstanding - Basic and
Diluted |
|
|
69,511,498 |
|
|
|
44,030,685 |
|
|
|
55,308,381 |
|
|
|
36,847,548 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
electroCore,
Inc.Condensed Consolidated Balance Sheet
Information(Unaudited)(in thousands)
|
September 30, 2021 |
|
December 31, 2020 |
Cash and cash equivalents |
$ |
37,995.0 |
|
|
$ |
4,241.9 |
Marketable securities |
$ |
1,001.1 |
|
|
$ |
18,386.2 |
Total assets |
$ |
47,570.7 |
|
|
$ |
31,518.2 |
Current liabilities |
$ |
5,738.9 |
|
|
$ |
5,890.3 |
Total liabilities |
$ |
6,454.4 |
|
|
$ |
7,873.6 |
Total equity |
$ |
41,116.4 |
|
|
$ |
23,644.6 |
|
|
|
|
|
|
|
(Unaudited) Use of Non-GAAP Financial
MeasureThe company is presenting adjusted EBITDA net loss
because it believes this measure is a useful indicator of its
operating performance. electroCore management uses this non-GAAP
measure principally as a measure of the company’s core operating
performance and believes that this measure is useful to investors
because it is frequently used by the financial community,
investors, and other interested parties to evaluate companies in
the company’s industry. The company also believes that this measure
is useful to its management and investors as a measure of
comparative operating performance from period to period.
Additionally, the company believes its use of non-GAAP adjusted
EBITDA net loss from operations facilitates management’s internal
comparisons to historical operating results by factoring out
potential differences caused by charges not related to its regular,
ongoing business, including, without limitation, non-cash charges
and certain large and unpredictable charges such as restructuring
expenses.
The company defines adjusted EBITDA net loss as GAAP net loss,
excluding depreciation and amortization, stock-compensation
expense, restructuring and other severance related charges, legal
fees associated with stockholders’ litigation, total other
income/expense, extinguishment of debt, and provision / benefit
from income taxes. A reconciliation of GAAP net loss to Non-GAAP
adjusted EBITDA net loss has been provided in the financial
statement tables included in this press release.
|
Three months
ended |
|
Nine months
ended |
|
September 30, |
|
September 30, |
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
(in
thousands) |
|
(in
thousands) |
GAAP net loss |
$ |
(3,993.7 |
) |
|
$ |
(4,486.4 |
) |
|
$ |
(12,271.3 |
) |
|
$ |
(17,187.3 |
) |
Depreciation
and amortization |
|
286.4 |
|
|
|
288.6 |
|
|
|
286.4 |
|
|
|
288.6 |
|
Stock-based
compensation |
|
2,540.6 |
|
|
|
2,490.6 |
|
|
|
2,540.6 |
|
|
|
2,490.6 |
|
Restructuring and other severance related charges |
|
- |
|
|
|
464.6 |
|
|
|
- |
|
|
|
464.6 |
|
Legal fees
associated with stockholders litigation |
|
394.8 |
|
|
|
371.0 |
|
|
|
394.8 |
|
|
|
1,104.7 |
|
Interest and
other (income) expense |
|
- |
|
|
|
(2.2 |
) |
|
|
(1.1 |
) |
|
|
(67.1 |
) |
Provision
(benefit) from income taxes |
|
8.7 |
|
|
|
- |
|
|
|
(876.7 |
) |
|
|
(1,170.9 |
) |
Gain on
extinguishment of debt |
|
- |
|
|
|
- |
|
|
|
(1,422.2 |
) |
|
|
- |
|
Adjusted EBITDA net loss |
$ |
(763.2 |
) |
|
$ |
(873.9 |
) |
|
$ |
(11,349.5 |
) |
|
$ |
(14,076.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
The company’s use of a non-GAAP measure has
limitations as an analytical tool, and you should not consider it
in isolation or as a substitute for analysis of its results as
reported under GAAP. Some of these limitations are: the non-GAAP
measure does not reflect interest or tax payments that may
represent a reduction in cash available; although depreciation and
amortization are non-cash charges, the assets being depreciated and
amortized may have to be replaced in the future, and the non-GAAP
measure does not reflect cash capital expenditure requirements for
such replacements or for new capital expenditure requirements; the
non-GAAP measure does not reflect the potentially dilutive impact
of equity-based compensation; and the non-GAAP measure does not
reflect changes in, or cash requirements for, working capital
needs; other companies, including companies in electroCore’s
industry, may calculate adjusted EBITDA net loss differently, which
reduces its usefulness as a comparative measure.
Because of these and other limitations, you should consider the
non-GAAP measure together with other GAAP-based financial
performance measures, including various cash flow metrics, net
loss, and other GAAP results. A reconciliation of GAAP net loss to
non-GAAP adjusted EBITDA net loss has been provided in the
preceding financial statements table of this press release.
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