MONMOUTH JUNCTION, N.J.,
May 9, 2016 /PRNewswire/ --
CytoSorbents Corporation (NASDAQ: CTSO), a critical care
immunotherapy leader commercializing its flagship CytoSorb® blood
purification cartridge to prevent or treat deadly inflammation and
organ failure in critically-ill and cardiac surgery patients around
the world, reports financial and operational results for the
quarter ending March 31, 2016.
First Quarter 2016 Financial Highlights:
- CytoSorb® product sales for Q1 2016 were a record $1.6 million. This represents an increase
of approximately 127% over Q1 2015 product sales of $0.7 million, as a result of solid increases in
both direct and distributor sales
- The annualized product sales run rate, as of Q1 2016, was
approximately $6.4 million, as
compared to an annualized product sales run rate of approximately
$2.8 million in Q1 2015
- Total revenue for the first quarter of 2016 was $1.8 million, which includes both product sales
and grant revenue
- Overall gross margin rose to approximately $1.0 million in Q1 2016, an increase of
approximately $0.6 million compared
to approximately $0.4 million in Q1
2015
- Product gross margin for Q1 2016 was approximately 62% compared
to approximately 59% for Q1 2015
- These results represent the third consecutive quarter of record
sales, as well as the fourth consecutive quarter of increases in
product sales, overall
First Quarter 2016 Operational Highlights:
- Approximately 12,000 human treatments have been performed with
CytoSorb® worldwide in critical care illnesses and cardiac
surgery
- The U.S.-based REFRESH I feasibility and safety study in
complex cardiac surgery patients is nearly two-thirds enrolled with
completion of enrollment expected in mid-2016
- Conducted another successful International CytoSorb® Users
meeting in Brussels, Belgium,
bringing together 107 people from 23 countries worldwide to learn
from and share their CytoSorb® treatment experiences with each
other, with presentations on key studies in refractory septic
shock, septic shock, early use in sepsis, and the intraoperative
use in cardiac surgery
- Exhibited at multiple critical care conferences including the
36th International Symposium on Intensive Care and
Emergency Medicine (ISICEM) in Brussels,
Belgium where we had the largest attendance ever (>300
attendees) at our sponsored research symposium and multiple
international posters accepted for presentation, the Symposium for
Intensive Care Medicine + Intensive Care Conference in Bremen, Germany, and the 45th
Society of Critical Care Medicine Congress (SCCM) in Orlando, Florida
- Numerous publications in peer-reviewed journals have been
published confirming safety and correlating CytoSorb® treatment and
reductions in cytokines with clinical benefit, such as hemodynamic
stabilization, in a wide range of patients
- Completed the first interim data analysis from the
International CytoSorb Registry, currently with 107 hospital
centers registered
- Awarded a $150K Phase I SBIR
contract to develop blood purification countermeasures to reduce
mycotoxins, such as aflatoxin, in whole blood, due to either
bio-warfare exposure or disseminated fungal infections
- Met with investors and presented at several investment
conferences, including the BIO CEO & Investor conference,
Needham Healthcare Conference, Biotech Showcase, and Source Capital
conference
- Recruited Dr. Volker Humbert, an
experienced critical care physician and anesthesiologist, as Senior
Manager of Clinical Affairs, tasked with providing comprehensive
medical support and education to CytoSorb users
worldwide
Dr. Phillip Chan, Chief Executive
Officer of CytoSorbents stated, "We are pleased to report another
record quarter of CytoSorb® sales, which reflects the continued and
growing usage of CytoSorb® by clinicians in a wide variety of
clinical indications, particularly sepsis and cardiac surgery.
At our recent 3rd International CytoSorb® Users
Meeting, and our recent critical care conferences in Germany and Belgium, it was extremely gratifying to
witness the expanding list of applications where CytoSorb® is being
successfully used to help save lives."
"For the remainder of 2016," Dr. Chan continued, "we anticipate
increased momentum in our core business, including potential:
- Accelerated growth in CytoSorb® sales
- Increased sales contributions by existing strategic partners,
including Fresenius Medical Care, that has confirmed the pending
launch of CytoSorb® in its exclusive territories later this
month
- Initiation of sales by existing distributors based upon
completed product registrations
- New strategic partnerships
- A completion of REFRESH I by mid-year with database lock and
announcement of top-line data in Q3 2016
- More clinical data from investigator-initiated studies and our
International CytoSorb® registry
- Additional publications of clinical studies involving
CytoSorb®
- New grant opportunities for CytoSorbents' technologies
- Strengthening of our balance sheet in a way that makes most
sense for the company and its shareholders
- Greater market awareness of our company amongst both retail and
fundamental institutional investors
We continue to work aggressively to drive to a potential
inflection point in our business, operating cash flow breakeven,
and the success of our company."
"Please join us on our previously announced earnings call today
at 4:45PM EST where we will cover our
progress and discuss some of the recent clinical studies in more
detail. We will also respond to questions from the audience
during our live Q&A session. The investor presentation
and a written transcript of the conference call will be available
within a week of the webcast."
Conference Call Details:
Date: Monday, May 9, 2016
Time: 4:45 PM Eastern
Participant Dial-In: 1-719-325-2138
Live Presentation
Webcast: http://public.viavid.com/index.php?id=119325
It is recommended that participants dial in approximately 10
minutes prior to the start of the call. There will also be a
simultaneous live webcast of the conference call that can be
accessed through the following audio feed link:
http://public.viavid.com/index.php?id=119325
An archived recording of the conference call will be available
within a week under the Investor Relations section of the Company's
website at http://www.cytosorbents.com/invest.htm
Three Months Ended March 31,
2016 Financial Results
Revenues:
Revenue from product sales was approximately $1,597,000 in the three months ended March 31, 2016, as compared to approximately
$704,000 in the three months ended
March 31, 2015, an increase of
approximately $893,000, or 127%. This
increase was largely driven by an increase in direct sales from
both new customers and repeat orders from existing customers, along
with an increase in distributor sales.
Grant income was approximately $213,000 for the three months ended March 31, 2016 as compared to approximately
$19,000 for the three months ended
March 31, 2015 as a result of revenue
recognized from new grants and billable milestones achieved on
existing grants.
As a result of the increases in both product sales and grant
income, for the three months ended March 31,
2016, we generated total revenue of approximately
$1,810,000, as compared to revenues
of approximately $723,000, for the
three months ended March 31, 2015, an
increase of approximately $1,087,000,
or 150%.
Cost of Revenues:
For the three months ended March 31,
2016 and 2015, cost of revenue was approximately
$819,000 and $304,000, respectively, an increase of
approximately $515,000. Product cost
of revenues increased approximately $321,000 during the three months ended
March 31, 2016 as compared to the
three months ended March 31, 2015 due
to increased sales. Product gross margins were approximately
62% for the three months ended March 31,
2016, as compared to approximately 59% for the three months
ended March 31, 2015. In
addition, direct labor and other costs being deployed toward
grant-funded activities, increased approximately $194,000, which has the effect of increasing the
amount of costs allocated to cost of revenue.
Research and Development Expenses:
For the three months ended March 31,
2016, research and development expenses were approximately
$856,000 as compared to research and
development expenses of approximately $951,000 for the three months ended March 31, 2015. The decrease of approximately
$95,000 in research and development
expenses was primarily due to an increase of $194,000 of direct labor and other costs being
deployed toward grant-funded activities, which had the effect of
decreasing the amount of our non-reimbursable research and
development costs. In addition, costs related to our non-clinical
research and development activities decreased by approximately
$69,000. These decreases were
offset by increases in salaries and other costs related to our
various clinical studies and trials of approximately $168,000 during the three months ended
March 31, 2016 as compared to the
three months ended March 31,
2015.
Legal, Financial and Other Consulting
Expenses:
Legal, financial, and other consulting expenses were
approximately $255,000 for the three
months ended March 31, 2016, as
compared to approximately $216,000
for the three months ended March 31,
2015. The increase of approximately $39,000 was due to an increase in accounting and
auditing fees of approximately $47,000 due to fees incurred related to the
initial audit of our internal controls as required by The
Sarbanes-Oxley Act of 2002 and an increase in legal fees of
approximately $29,000. These
increases were offset by approximately $37,000 in employment agency and consulting fees
incurred in 2015 related to the hiring of senior level personnel
that did not recur in 2016.
Selling, General and Administrative Expenses:
Selling, general, and administrative expenses were approximately
$1,970,000 for the three months ended
March 31, 2016, as compared to
approximately $1,515,000 for the
three months ending March 31, 2015.
The increase of approximately $455,000 in selling, general, and administrative
expenses was due to an increase in salaries, commissions, and
related costs of approximately $241,000 due to headcount additions and increases
in product sales, an increase in royalty expenses of approximately
$62,000 due to the increase in sales,
additional sales and marketing costs, which include advertising and
conferences, of approximately $85,000, and an increase in travel and
entertainment costs and other expenses of approximately
$67,000 due to the increased
volume.
Gain (Loss) on Foreign Currency Transactions:
For the three months ended March 31,
2016, the gain on foreign currency transactions was
approximately $232,000 as compared to
a loss of approximately $449,000 for
the three months ended March 31,
2015. The 2016 first quarter gain is directly related to the
increase in the exchange rate of the Euro at March 31, 2016 as compared to December 31, 2015. The exchange rate of the
Euro to the U.S. dollar was $1.14 per
Euro at March 31, 2016 as compared to
$1.08 per Euro at December 31, 2015.
Change in Warrant Liability:
We recognize warrants as liabilities at their fair value on the
date of the grant because of price adjustment provisions in the
warrants, then measure the fair value of the warrants on each
reporting date, and record a change to the warrant liability as
appropriate. The change in warrant liability resulted in other
income of approximately $18,000 for
the three months ended March 31,
2016, and a charge to other expense of approximately
$2,008,000 for the three months ended
March 31, 2015. The change in warrant
liability was a result of the change in the fair value of the
warrant liability from December 31,
2015 to March 31, 2016 and
from December 31, 2014 to
March 31, 2015.
Liquidity and Capital Resources
Since inception, our operations have been primarily financed
through the private placement of debt and equity securities. At
March 31, 2016, we had current assets
of approximately $8,041,000 including
cash on hand and short-term investments of approximately
$6,027,000 and current liabilities of
approximately $3,248,000. We believe
we have sufficient cash to fund our operations into the fourth
quarter of 2016; however, we may need to raise additional capital
to fully fund pivotal trials in the
United States and/or Germany. We will be better able to assess this
need once the specific protocols are finalized with appropriate
regulatory bodies. In addition, we may require additional capital
to support our sales and marketing efforts, to fund clinical
studies, to expand our production capacity, to further develop our
products, and for general working capital purposes.
2016 Second Quarter Revenue Guidance
CytoSorbents has not historically given financial guidance on
quarterly results until the quarter has been completed. However, we
continue to expect our second quarter 2016 product sales to meet or
exceed the level of sales achieved in the second quarter of
2015.
For additional information please see the Company's Form 10-Q
for the quarter ended March 31, 2016
filed on May 9, 2016 on
http://www.sec.gov.
About CytoSorbents Corporation (NASDAQ: CTSO)
CytoSorb® is approved in the European Union with distribution in
32 countries around the world, as a safe and effective
extracorporeal cytokine adsorber, designed to reduce the "cytokine
storm" or "cytokine release syndrome" that could otherwise cause
massive inflammation, organ failure and death in common critical
illnesses such as sepsis, burn injury, trauma, lung injury, and
pancreatitis, as well as in cancer immunotherapy. These are
conditions where the risk of death is extremely high, yet no
effective treatments exist. CytoSorb® is also
being used during and after cardiac surgery to remove inflammatory
mediators, such as cytokines and free hemoglobin, which can lead to
post-operative complications, including multiple organ
failure. CytoSorb® has been used safely in more than 12,000
human treatments to date.
CytoSorbents' purification technologies are based on
biocompatible, highly porous polymer beads that can actively remove
toxic substances from blood and other bodily fluids by pore capture
and surface adsorption. The Company has numerous products
under development based upon this unique blood purification
technology, protected by 32 issued U.S. patents and multiple
applications pending, including HemoDefend™, ContrastSorb,
DrugSorb, and others. Additional information is available for
download on the Company's websites:
http://www.cytosorbents.com and http://www.cytosorb.com
Forward-Looking Statements
This press release includes forward-looking statements intended
to qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to,
statements about our plans, objectives, representations and
contentions and are not historical facts and typically are
identified by use of terms such as "may," "should," "could,"
"expect," "plan," "anticipate," "believe," "estimate," "predict,"
"potential," "continue" and similar words, although some
forward-looking statements are expressed differently. You should be
aware that the forward-looking statements in this press release
represent management's current judgment and expectations, but our
actual results, events and performance could differ materially from
those in the forward-looking statements. Factors which could cause
or contribute to such differences include, but are not limited to,
the risks discussed in our Annual Report on Form 10-K, filed with
the SEC on March 9, 2016, as updated by the risks reported in
our Quarterly Reports on Form 10-Q, and in the press releases and
other communications to shareholders issued by us from time to time
which attempt to advise interested parties of the risks and factors
which may affect our business. We caution you not to place undue
reliance upon any such forward-looking statements. We undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events,
or otherwise, other than as required under the Federal securities
laws.
CYTOSORBENTS
CORPORATION
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(amounts in
thousands, except per share data)
|
|
|
|
Three months ended
March 31,
|
|
|
2016
|
|
2015
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Revenues
|
|
|
|
|
Sales
|
|
$ 1,597
|
|
$ 704
|
Grant
income
|
|
213
|
|
19
|
Other
revenue
|
|
--
|
|
1
|
Total
revenues
|
|
1,810
|
|
724
|
Cost of
revenue
|
|
819
|
|
305
|
Gross
profit
|
|
991
|
|
419
|
|
|
|
|
|
Other
Expenses:
|
|
|
|
|
Research and
development
|
|
856
|
|
951
|
Legal,
financial and consulting
|
|
255
|
|
216
|
Selling,
general and administrative
|
|
1,970
|
|
1,515
|
Total
expenses
|
|
3,081
|
|
2,682
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(2,090)
|
|
(2,263)
|
|
|
|
|
|
Other
income/(expense):
|
|
|
|
|
Interest
income/(expense)
|
|
4
|
|
3
|
Gain (loss) on
foreign currency transactions
|
|
232
|
|
(449)
|
Change in warrant
liability
|
|
18
|
|
(2,008)
|
Total other
income/(expense), net
|
|
254
|
|
(2,454)
|
|
|
|
|
|
Net loss before
benefit from income taxes
|
|
(1,836)
|
|
(4,717)
|
Benefit from income
taxes
|
|
--
|
|
--
|
Net loss available to
common shareholders
|
|
$(1,836)
|
|
$(4,717)
|
Earnings per
share:
|
|
|
|
|
Basic and diluted net
loss per share
|
|
($0.08)
|
|
($0.19)
|
|
|
|
|
|
Basic and diluted
weight average shares outstanding
|
|
24,401,167
|
|
24,394,474
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
($1,836)
|
|
($4,717)
|
Other comprehensive
loss:
|
|
|
|
|
Currency translation adjustment
|
|
(246)
|
|
344
|
Comprehensive
loss
|
|
($2,082)
|
|
($4,373)
|
|
|
|
|
|
CYTOSORBENTS
CORPORATION
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(amounts in
thousands)
|
|
|
March 31,
2016
(Unaudited)
|
|
December
31,
2015
|
ASSETS:
|
|
|
|
Cash and cash
equivalents
|
$3,537
|
|
$5,316
|
Short-term
investments
|
2,490
|
|
2,192
|
Grants and accounts
receivable, net
|
760
|
|
649
|
Inventories
|
1,060
|
|
1,191
|
Prepaid expenses and
other current assets
|
194
|
|
512
|
Total current assets
|
8,041
|
|
9,860
|
|
|
|
|
Property and
equipment, net
|
569
|
|
557
|
Other
assets
|
902
|
|
837
|
TOTAL ASSETS
|
$9,512
|
|
$11,254
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Accounts
payable
|
$ 860
|
|
$ 685
|
Accrued expenses and
other current liabilities
|
770
|
|
723
|
Deferred
revenue
|
--
|
|
--
|
Warrant
liability
|
1,618
|
|
1,636
|
Total current liabilities
|
3,248
|
|
3,044
|
|
|
|
|
Total Stockholders'
Equity
|
6,264
|
|
8,210
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$9,512
|
|
$11,254
|
|
|
|
|
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Cytosorbents Contact:
Amy Vogel
Investor
Relations
(732) 329-8885 ext.
*825
avogel@cytosorbents.com
Investor Contact:
Lee Roth
The Ruth
Group
646-536-7012
lroth@theruthgroup.com
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SOURCE CytoSorbents Corporation