Titan Medical Inc. (Nasdaq: TMDI; TSX: TMD), a medical device
company focused on the development and commercialization of
innovative surgical technologies for single access robotic-assisted
surgery (RAS), today announced financial results for the three and
six months ended June 30, 2022.
“I am thrilled to lead Titan Medical as President and CEO and
have been committed to the company’s mission to improve surgical
outcomes as a director of the company since September 2020. We
continue to make progress on impacting the future of minimally
invasive robotic surgery and the operating room ecosystem. Our
technical partnerships, our relationships with surgeons and the
dedication of our employees support our efforts in submitting an
IDE application, designing forthcoming clinical trials and planning
our commercialization strategy for the U.S. market,” stated Cary G.
Vance, Titan’s President and CEO. “Setting Titan apart is our
innovative, ergonomic platform design derived from extensive
surgeon input. We believe this will set the stage for the next
generation of single access RAS to advance patient care. The
capability of the Enos system to operate robust, small-scale, and
dexterous instruments through a minimal incision should improve
patient outcomes and change the paradigm for surgeons and
patients,” concluded Mr. Vance.
The company plans to pursue a De Novo regulatory process for
marketing authorization with the U.S. Food and Drug Administration
(FDA). Utilizing the Q-Submission program, the company has engaged
in ongoing dialogue with the FDA to clarify requirements in an
effort to mitigate against timeline risks. The company plans to
file the IDE application with the FDA mid-year 2023 for its initial
target indication for benign gynecologic surgical procedures. Titan
anticipates receiving a response on the IDE application from the
FDA in the second half of 2023. Following IDE approval, Titan
expects to proceed with and complete a clinical study in time for
submission of a De Novo classification request with the FDA in
2024. Commercial launch of the Enos™ single access RAS system is
scheduled to begin upon receipt of marketing authorization from the
FDA, anticipated in early 2025.
Recent Company Activities and
Progress
- Announced appointment of Cary G.
Vance as President and Chief Executive Officer
- Previously served as CEO at Xcath
Incorporated, a privately held neurovascular robotics company, and
held similar positions at Optiscan Biomedical, and Myoscience.
Served as President and CEO at Hansen Medical, a publicly held
intravascular robotics company acquired by Auris Health in 2016,
which was subsequently acquired by Johnson & Johnson in 2019.
Prior to Hansen, served in various global executive leadership
roles at Teleflex, Covidien (now part of Medtronic) and GE
Healthcare.
- Granted 180-day extension by Nasdaq
to regain compliance with minimum bid price rule
- In addition to reviewing its
options, the company continues to try to regain compliance with
Nasdaq Rule 5550(a)(2) prior to the December 26, 2022
deadline.
- Continued communications with the
FDA via Q-submission process
- The company submitted an additional
Q-submission with the FDA, as part of its ongoing communications
plan to obtain additional guidance from the FDA.
- Participated at the Society of
Robotic Surgery Annual Meeting held June 30 - July 3, 2022
- Chris Seibert, Titan’s VP, Upstream
Marketing participated in a panel discussion featuring executives
from companies recognized for promising technology platforms in
robotic surgery and delivered a presentation on Titan during the
plenary session.
- Announced agreement with Nissha
Medical Technologies for the manufacture of surgical consumables
- Manufactured single use surgical
components will be used for verification and validation testing and
in pre-clinical and clinical studies of Titan’s Enos system.
- Held an Annual and Special Meeting
of Shareholders
- All nominees for election were
elected as directors of the company by shareholders. The
shareholders approved the renewal and amendment of the company’s
share unit plan and deferred share unit plan and adoption of an
employee share purchase plan.
- Bill Fahey appointed Vice President,
Manufacturing and Operations
- Previously SVP of Engineering at
Precision Spine/Spinal USA and was with Orthofix/Blackstone Medical
Inc as Sr. Director of Engineering. Bringing development,
manufacturing and commercialization experience to Titan, is
responsible for both in-house and contract manufacturing
relationships, working closely with product development and the
quality and regulatory affairs teams.
- Finalizing product design transfer
to manufacturing
- Manufactured units of the Enos
system expected later this year.
- Presented at the H.C. Wainwright
Global Investment Conference in Miami on May 25, 2022 and
participated in investor meetings
Financial Highlights
Summary
As of June 30, 2022, Titan had cash and cash equivalents of
$20.2 million, compared to $32.3 million at December 31, 2021.
For the three months ended June 30, 2022, R&D expenses
increased to $9.5 million compared to $8.4 million for the for the
three months ended June 30, 2021. R&D expenses were $19.1
million for the six months ended June 30, 2022 compared to $17.6
million for the six months ended June 30, 2021. R&D expenses
for the three and six-month period ending June 30, 2022 were
related to the development of the Enos system and an increase in
labor costs as the company continues to add the required resources
to its engineering, regulatory and quality teams to advance the
Enos system. During this period, the company’s focus was on
completing product development and transferring key components on
the Enos system to our external manufacturing partner. During the
quarter, the Company transferred substantially all of the
components to its manufacturing partner.
G&A expenses decreased to $3.1 million for the three months
ended June 30, 2022 compared to $3.6 million for the three months
ended June 30, 2021. The decrease in G&A expenses in the
three-month period is related to a decrease in stock-based
compensation of $1.1 million, partially offset by an increase in
severance costs and public company costs.
For the six-month period ended June 30, 2022, G&A expenses
were $5.7 million compared to $6.2 million in the comparative
period. The decrease in G&A expenses in the six-month period is
primarily related to a decrease in stock-based compensation of $1.4
million and a decrease in professional and consulting fees
partially offset by an increase in severance costs, public company
costs and recruitment fees related to filling open roles on the
senior leadership team.
The company’s interim financial statements and MD&A are
available at www.sedar.com and at www.sec.gov.
Investor Audio Webcast
Information
Titan Medical will host an investor audio webcast at 8:30 a.m.
ET today (August 11, 2022) to discuss the company’s financial
results for the three months ended June 30, 2022, and recent
business highlights. The webcast can be accessed via the Investor
Relations section of the company’s website
www.titanmedicalinc.com.
About Titan Medical
Titan Medical Inc. (Nasdaq: TMDI; TSX: TMD), a medical device
company headquartered in Toronto, Ontario and with operations in
Chapel Hill, North Carolina, is focused on enhancing robotic
assisted surgery using innovative technology through a single
access point. The Enos™ robotic single access surgical system is
being developed with an ergonomic focus to provide a surgical
experience that imitates real-life movements that surgeons demand
and includes multi-articulating instruments designed to allow
surgeons an increased range of motion in a confined space, with
dexterity and the ability to exert the forces necessary to complete
common surgical tasks. With the Enos system, Titan intends to
initially pursue gynecologic surgical indications.
Enos™ is a trademark of Titan Medical Inc.
For more information,
visit www.titanmedicalinc.com and
follow @TitanMedical on Twitter and LinkedIn.
Forward-Looking Statements
This news release contains “forward-looking statements” within
the meaning of applicable Canadian and U.S. securities laws, which
reflect the current expectations of management of the company’s
future growth, results of operations, performance, and business
prospects and opportunities. Forward-looking statements are
frequently, but not always, identified by words such as “may”,
“would”, “could”, “will”, “anticipate”, “believe”, “plan”,
“expect”, “intend”, “estimate”, “potential for” and similar
expressions, although these words may not be present in all
forward-looking statements. Forward-looking statements that appear
in this release may include, without limitation, references to: the
company’s focus on surgical technologies for single access RAS; the
company’s plans and expectations with respect to timing for
regulatory submissions, including for an IDE application and De
Novo application, clinical trials and the commercialization of the
Enos system; the company’s dialogue with the FDA and utilization of
the Q-Submission program to mitigate against timeline risks; the
company’s plans to regain compliance with Nasdaq Rule 5550(a)(2);
the company’s intention to host an upcoming investor audio webcast;
the Enos system being developed with an ergonomic focus to provide
a surgical experience that imitates real-life movements; and the
company’s intention to initially pursue gynecologic surgical
indications. These statements reflect management’s current beliefs
and are based on information currently available to management.
Forward-looking statements involve significant risks,
uncertainties, and assumptions. Many factors could cause the
company’s actual results, performance, or achievements to be
materially different from any future results, performance or
achievements that may be expressed or implied by such
forward-looking statements, including, without limitation, those
listed in the “Risk Factors” section of the company’s Annual Report
for the fiscal year ended December 31, 2021, which may be viewed
at www.sedar.com and at www.sec.gov. Should one or
more of these risks or uncertainties materialize, or should
assumptions underlying the forward-looking statements prove
incorrect, actual results, performance, or achievements may vary
materially from those expressed or implied by the forward-looking
statements contained in this news release. These factors should be
considered carefully, and prospective investors should not place
undue reliance on the forward-looking statements. Although the
forward-looking statements contained in the news release are based
upon what management currently believes to be reasonable
assumptions, the company cannot assure prospective investors that
actual results, performance or achievements will be consistent with
these forward-looking statements. Except as required by law, the
company expressly disclaims any intention or obligation to update
or revise any forward-looking statements whether as a result of new
information, future events or otherwise.
ContactKristen GalfettiVice President, Investor
Relations & Corporate
Communications+1-781-869-2553investors@titanmedicalinc.com
Titan Medical Inc. |
|
|
|
|
|
Interim
Consolidated Statements of Financial Position |
|
|
(In thousands of
US dollars) |
|
|
|
|
|
|
|
|
June 30, 2022 |
|
December 31, 2021 |
Assets |
|
|
$ |
|
$ |
CURRENT
ASSETS |
|
|
|
|
|
|
Cash |
|
|
20,179 |
|
32,306 |
|
Receivables |
|
|
- |
|
8,280 |
|
Prepaid expenses,
deposits and receivables |
1,517 |
|
3,076 |
TOTAL
CURRENT ASSETS |
|
21,696 |
|
43,662 |
|
|
|
|
|
|
|
NON-CURRENT
ASSETS |
|
|
|
|
|
Right-of-use
assets, net |
|
1,388 |
|
1,177 |
|
Property and
equipment, net |
|
683 |
|
464 |
|
Patent rights, net |
|
|
1,991 |
|
1,919 |
TOTAL
NON-CURRENT ASSETS |
4,062 |
|
3,560 |
Total assets |
|
|
25,758 |
|
47,222 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
|
Accounts payable
and accrued liabilities |
7,821 |
|
5,616 |
|
Current portion of
lease liabilities |
339 |
|
346 |
|
Warrant derivative
liability |
|
263 |
|
4,930 |
TOTAL
CURRENT LIABILITIES |
|
8,423 |
|
10,892 |
|
|
|
|
|
|
|
NON-CURRENT
LIABILITIES |
|
|
|
|
Deferred income
tax labilities |
|
56 |
|
56 |
Long-term lease
liabilities |
|
1,202 |
|
981 |
Total Liabilities |
|
|
9,681 |
|
11,929 |
|
|
|
|
|
|
|
Shareholders'
equity |
|
|
|
|
Share
capital |
|
|
263,871 |
|
263,364 |
Contributed
surplus-Warrant reserve |
11,749 |
|
11,749 |
Contributed
surplus |
|
|
14,448 |
|
14,067 |
Deficit |
|
|
(273,991) |
|
(253,887) |
Shareholders' equity |
|
16,077 |
|
35,293 |
Total liabilities and Shareholders' equity |
25,758 |
|
47,222 |
Titan
Medical Inc. |
|
|
|
|
|
|
|
Interim
Consolidated Statements of Net and Comprehensive Loss |
|
|
|
|
(In thousands of
US dollars, except share and per share amount) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30 |
|
Six Months Ended June 30 |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
$ |
|
$ |
|
$ |
|
$ |
Revenues |
- |
|
10,043 |
|
- |
|
10,093 |
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Research and development |
9,509 |
|
8,361 |
|
19,109 |
|
17,644 |
General and administrative |
3,142 |
|
3,630 |
|
5,660 |
|
6,207 |
Depreciation |
- |
|
- |
|
- |
|
- |
Total expenses |
12,651 |
|
11,991 |
|
24,769 |
|
23,851 |
Net loss from operations |
(12,651) |
|
(1,948) |
|
(24,769) |
|
(13,758) |
|
|
|
|
|
|
|
|
Other Expenses (Income) |
|
|
|
|
|
|
|
Finance
income |
(21) |
|
(20) |
|
(61) |
|
(33) |
Finance
expense |
17 |
|
57 |
|
35 |
|
- |
Foreign
exchange (gain) loss |
(6) |
|
15 |
|
28 |
|
59 |
(Gain) loss on fair value of warrant |
(1,758) |
|
(1,060) |
|
(4,667) |
|
1,950 |
Total other (income)
expenses |
(1,768) |
|
(1,008) |
|
(4,665) |
|
1,976 |
Net and comprehensive loss |
(10,883) |
|
(940) |
|
(20,104) |
|
(15,734) |
|
|
|
|
|
|
|
|
Basic and fully diluted loss per share |
(0.10) |
|
(0.01) |
|
(0.18) |
|
(0.16) |
Titan Medical Inc. |
|
|
|
Interim
Consolidated Statements of Cash Flows |
|
|
|
(In thousands of
US dollars) |
|
|
|
|
|
|
Six Months Ended June 30 |
|
|
|
2022 |
|
2021 |
|
|
|
$ |
|
$ |
OPERATING
ACTIVITIES |
|
|
|
|
Net loss and
comprehensive loss |
(20,104) |
|
(15,734) |
|
Items not
involving current cash flows: |
|
|
|
|
|
Depreciation and amortization |
349 |
|
235 |
|
|
Interest expense on lease liabilities |
36 |
|
33 |
|
|
Share-based compensation expense |
888 |
|
2,198 |
|
|
(Gain) loss on change in fair value of warrants |
(4,667) |
|
1,950 |
|
|
Accrued interest on Note payable |
- |
|
76 |
|
|
Warrant liability-foreign exchange adjustment |
- |
|
44 |
Changes in
non-cash working capital balances |
|
|
|
|
Receivables |
8,280 |
|
- |
|
Prepaid expenses and deposits |
1,559 |
|
(426) |
|
Accounts payable and accrued liabilities |
2,205 |
|
(2,424) |
Cash used in operating activities |
(11,454) |
|
(14,048) |
FINANCING
ACTIVITIES |
|
|
|
|
Exercise of Derivative warrants |
- |
|
8,000 |
|
January 2021 Equity Offering, net of issuance costs |
- |
|
10,375 |
|
February 2021 Equity Offering, net of issuance costs |
- |
|
21,093 |
|
Exercise of Equity warrants |
- |
|
1,985 |
|
Exercise of stock options |
- |
|
14 |
|
Proceeds from issuance of common shares |
- |
|
2,380 |
|
Note payable |
- |
|
174 |
|
Repayment of lease liabilities |
(205) |
|
(102) |
Cash (used in) provided by financing activities |
(205) |
|
43,919 |
INVESTING
ACTIVITIES |
|
|
|
|
Purchase of
property, plant and equipment |
(334) |
|
(152) |
|
Purchase of patents |
(134) |
|
(183) |
Cash used in investing activities |
(468) |
|
(335) |
|
|
|
|
|
|
(Decrease)
increase in cash |
(12,127) |
|
29,536 |
Cash,
beginning of the period |
32,306 |
|
25,469 |
Cash, end of the period |
20,179 |
|
55,005 |
###
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