electroCore, Inc. (Nasdaq: ECOR), a commercial-stage bioelectronic
medicine company, today announced first quarter 2022 financial
results and provided an operational update.
First Quarter 2022 and Recent
Highlights
- Posted revenue of $1.9 million, representing an increase of
approximately 58% over first quarter 2021 and 27%
sequentially;
- Net cash used in operating activities was $4.8 million during
the first quarter 2022 leaving approximately $29.9 million of cash
and cash equivalents at March 31, 2022;
- Launched U.S. e-commerce portal and online store for patients
to gain access to gammaCore™ therapy;
- Announced Breakthrough Device Designation from the Food and
Drug Administration (FDA) for the treatment of post-traumatic
stress disorder (PTSD);
- Presented data suggesting the role of non-invasive vagus nerve
stimulation (nVNS) in the acute treatment of stroke at the
International Stroke Congress in New Orleans;
- Executed an exclusive license agreement with Teijin Limited
(Teijin) for Japan territory; and
- Announced the selection of gammaCore™ for the Department of
Defense Biotech Optimized for Operational Solutions and Tactics
(BOOST) program.
“electroCore continued to make strides in the first quarter of
2022,” stated Dan Goldberger, Chief Executive Officer of
electroCore. “We recorded revenues of $1.9 million, delivering
58% growth over the first quarter 2021, and 27% sequential
growth. Our continued momentum is a result of our ongoing
investment in our sales channels and marketing initiatives for our
headache indications. In January 2022, gammaCore™ received a
Breakthrough Device Designation for PTSD from the FDA. We also
launched a U.S. e-commerce portal and online store for patients to
receive a telehealth consult, obtain a prescription, and purchase
gammaCore™, making the experience for a patient to obtain
gammaCore therapy more convenient. More recently, we announced
an exclusive license agreement with Teijin to license certain
exclusive rights to our nVNS technology for commercialization
in Japan, providing additional validation of the commercial
opportunity for nVNS."
First Quarter 2022 Financial Results For
the quarter ended March 31, 2022, electroCore reported net sales of
$1.9 million compared to $1.5 million in the fourth quarter of 2021
and $1.2 million during same period of 2021.Revenue from the
Department of Veterans Affairs (VA) and Department of Defense (DOD)
increased 47% sequentially to $1.3 million in the first quarter of
2022 from $858,000 in the fourth quarter of 2021 and increased 86%
as compared to $679,000 in the first quarter of 2021. Revenue
reported from outside the United States (OUS) was $305,000 in the
first quarter of 2022, as compared to $361,000 in the fourth
quarter of 2021 and $380,000 in the first quarter of
2021.
Gross profit for the first quarter of 2022 was $1.5 million as
compared to $1.2 million, for the fourth quarter of 2021 and
$840,000 for the first quarter of 2021. Gross profit for the fourth
quarter of 2021 was reduced by an increase in inventory reserves of
$70,000. Gross margin for the first quarter of 2022 was 81%,
compared to 80% in the fourth quarter of 2021 and 70% in the first
quarter of 2021. Total operating expenses in the first
quarter of 2022 were approximately $7.1 million as compared to $6.7
million in the fourth quarter of 2021 and $6.2 million in the first
quarter of 2021.
Research and development expense in the first quarter of 2022
was $934,000, as compared to $742,000 in the fourth quarter of 2021
and $499,000 in the first quarter of 2021. The increase was
driven by investments in development of a next-generation,
app-based platform for our proprietary therapy.
Selling, general and administrative expense in the first quarter
of 2022 was $6.2 million as compared to $5.9 million in the fourth
quarter of 2021 and $5.7 million in the first quarter of 2021. The
increase was driven by investments in Direct-to-Consumer awareness
campaigns and our newly launched e-commerce platform.
GAAP net loss in the first quarter of 2022 was $5.6 million
compared to the fourth quarter of 2021 GAAP net loss of $4.9
million and $5.4 million in the first quarter of 2021.
Adjusted EBITDA net loss in the first quarter of 2022 was $4.6
million as compared to $4.4 million during the fourth quarter of
2021 and as compared to a loss of $4.2 million in the first quarter
of 2021.
The company defines adjusted EBITDA net loss as GAAP net loss as
adjusted to exclude non-operating gains and losses, depreciation
and amortization, stock-based compensation expense, legal fees
associated with stockholders’ litigation, 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 in the quarter ended March
31, 2022, was approximately $4.8 million as compared to $4.4
million in the fourth quarter of 2021, and $4.2 million in the
first quarter of 2021. The increase in cash used was driven in
part by the timing of certain planned annual disbursements.
Cash and cash equivalents at March 31, 2022 totaled
approximately $29.9 million, as compared to approximately $34.7
million at December 31, 2021.
Second Quarter 2022 Outlook
For the second quarter of 2022, the Company expects net revenue
to be at least $1.9 million and net cash used in
operating activities to be approximately $3.5 million.
Webcast and Conference Call Information
electroCore’s management team will host a conference call
today, May 5, 2022, beginning at 4:30 PM EDT.
Investors interested in listening to the conference call, or
webcast may do so by dialing 877-269-7756 for domestic callers
or 201-689-7817 for international callers, using Conference
ID: 13728177, or by connecting to the Web:
electroCore 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 gammaCoreTMgammaCore™
(nVNS) is the first non-invasive, hand-held medical therapy applied
at the neck 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 is 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, and
paroxysmal hemicrania and hemicrania continua in 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
For more information, please visit gammaCore.com.
Forward-Looking StatementsThis press release
and other written and oral statements made by representatives of
electroCore 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 business prospects and clinical and
product development plans (including with respect to enrollment in
ongoing studies); its expected revenue and net cash used in
operating activities for the second quarter 2022; its pipeline or
potential markets for its technologies; the timing, outcome and
impact of regulatory, clinical and commercial developments
including online, e-commerce, direct-to-consumer channels,
telehealth portal, and cash pay initiatives; the issuance of U.S.
and international patents providing expanded IP coverage; the
possibility of future business models and revenue streams from the
company’s potential use of nVNS for the acute treatment of PTSD,
stroke and hemorrhagic brain injury, the potential of nVNS
generally and gammaCore in particular 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™, the potential impact and
effects of COVID-19 on the business of electroCore, electroCore’s
results of operations and financial performance, and any measures
electroCore has and may take in response to COVID-19 and any
expectations electroCore may have with respect thereto, 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
electroCore,
Inc.Condensed Consolidated Statements of
Operations(unaudited)(in thousands, except per share
data)
|
|
Three Months Ended March 31, |
|
|
2022 |
|
2021 |
Net sales |
|
$ |
1,899 |
|
|
$ |
1,204 |
|
Cost of goods sold |
|
|
360 |
|
|
|
364 |
|
Gross profit |
|
|
1,539 |
|
|
|
840 |
|
Operating expenses |
|
|
|
|
|
|
|
|
Research and development |
|
|
934 |
|
|
|
499 |
|
Selling, general and administrative |
|
|
6,186 |
|
|
|
5,725 |
|
Total operating expenses |
|
|
7,120 |
|
|
|
6,224 |
|
Loss from operations |
|
|
(5,581 |
) |
|
|
(5,384 |
) |
Other (income) expense |
|
|
|
|
|
|
|
|
Interest and other income |
|
|
(4 |
) |
|
|
(3 |
) |
Other expense |
|
|
5 |
|
|
|
3 |
|
Total other (income)
expense |
|
|
1 |
|
|
|
— |
|
Loss before income taxes |
|
|
(5,582 |
) |
|
|
(5,384 |
) |
(Provision) benefit from
income taxes |
|
|
— |
|
|
|
— |
|
Net loss |
|
$ |
(5,582 |
) |
|
$ |
(5,384 |
) |
Net loss per share of common
stock - Basic and Diluted |
|
$ |
(0.08 |
) |
|
$ |
(0.11 |
) |
Weighted average number of
common shares outstanding - Basic and Diluted |
|
|
70,672 |
|
|
|
47,653 |
|
electroCore,
Inc. Condensed Consolidated Balance Sheet
Information(unaudited)(in thousands)
|
|
March 31, 2022 |
|
December 31, 2021 |
Cash and cash equivalents |
|
$ |
29,882 |
|
|
$ |
34,689 |
|
Total assets |
|
$ |
37,181 |
|
|
$ |
42,833 |
|
Current liabilities |
|
$ |
4,683 |
|
|
$ |
5,485 |
|
Total liabilities |
|
$ |
5,365 |
|
|
$ |
6,185 |
|
Total equity |
|
$ |
31,816 |
|
|
$ |
36,648 |
|
(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 gains and 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,
adjusting to exclude non-operating gains and losses, depreciation
and amortization, stock-compensation expense, legal fees
associated with stockholders’ litigation, and provision / benefit
from income taxes.
Following is a reconciliation of GAAP net loss to Non-GAAP
adjusted EBITDA net loss:
|
Three Months ended March 31, |
|
2022 |
|
2021 |
|
(in thousands) |
GAAP net loss |
$ |
(5,582 |
) |
|
$ |
(5,384 |
) |
Depreciation and
amortization |
|
106 |
|
|
|
96 |
|
Stock-based compensation |
|
777 |
|
|
|
942 |
|
Legal fees associated with
stockholders' litigation |
|
61 |
|
|
|
151 |
|
Total other
(income)/expense |
|
1 |
|
|
|
— |
|
Provision (benefit) from
income taxes |
|
— |
|
|
|
— |
|
Adjusted EBITDA net
loss |
$ |
(4,637 |
) |
|
$ |
(4,195 |
) |
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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