Q3 total revenue of $5.1 million, up 28% over
the prior year
156 MyoPro orders and insurance authorizations
received, including the first payments for five Medicare Part B
patients
Conference call begins at 4:30 p.m. Eastern
time today
Myomo, Inc. (NYSE American: MYO) (“Myomo” or the
“Company”), a wearable medical robotics company that offers
increased functionality for those suffering from neurological
disorders and upper-limb paralysis, today announced financial
results for the three and nine months ended September 30, 2023.
Financial and operational highlights for the third quarter of
2023 include the following (all comparisons are with the third
quarter of 2022):
- Total revenue was $5.1 million, up 28%. Product revenue was
$5.0 million, up 27%;
- Revenue units were 119, up 37%;
- MyoPro® orders and insurance authorizations were received for
156 units, up 20%;
- Backlog, which represents insurance authorizations and orders
received but not yet converted to revenue, was 185 units, up 1%,
including five Medicare Part B patients for whom at least one
rental payment has been received;
- 381 new candidates were added to the patient pipeline, up
22%;
- There were 1,046 MyoPro candidates in the patient pipeline as
of September 30, 2023, up 28%;
- Gross margin was 68.7%, up 220 basis points; and,
- Cost per pipeline add, which reflects only payers that have
previously reimbursed for the MyoPro, was $2,159, a reduction of
36%.
Management Commentary
“We are pleased to deliver record quarterly product revenue that
exceeded $5 million for the first time, driven by a record number
of orders and insurance authorizations, including authorizations we
were able to convert into revenue in the quarter," stated Paul R.
Gudonis, Myomo's chairman and chief executive officer. "Our focus
for the rest of the year is to continue executing to our business
plan while managing our operating expenses, and working to ensure
successful outcomes for our patients, including Medicare Part B
beneficiaries. We look forward to working with appropriately
screened and medically necessary Medicare Part B patients in
anticipation of being able to fit them with their own MyoPro."
Financial Results
For the Three Months
Ended September 30,
Period-
to-Period
Change
For the Nine Months
Ended September 30,
Period-
to-Period
Change
2023
2022
$
%
2023
2022
$
%
Product revenue
$
5,029,523
$
3,968,201
$
1,061,322
27
%
$
12,719,855
$
10,513,702
$
2,206,153
21
%
License revenue
50,000
-
50,000
N/M
1,764,920
1,000,000
764,920
76
%
Total revenue
5,079,523
3,968,201
1,111,322
28
%
14,484,775
11,513,702
2,971,073
26
%
Cost of revenue
1,590,675
1,331,217
259,458
19
%
4,407,269
3,888,217
519,052
13
%
Gross profit
$
3,488,848
$
2,636,984
$
851,864
32
%
$
10,077,505
$
7,625,485
$
2,452,020
32
%
Gross margin %
68.7
%
66.5
%
2.2
%
69.6
%
66.2
%
3.3
%
Total revenue for the third quarter of 2023 was $5.1 million, up
28% compared with the third quarter of 2022. Excluding guaranteed
minimum payment revenue from the China JV company, product revenue
was $5.0 million, up 27% compared with the third quarter of 2022.
Growth in product revenue was driven by a higher number of revenue
units, offset by a slightly lower average selling price (“ASP”).
Myomo recognized revenue on 119 MyoPro units in the third quarter
of 2023, up 37% over the same quarter a year ago. Year-to-date
total revenue was $14.5 million, up 26% compared with the same
period a year ago.
Gross margin for the third quarter of 2023 was 68.7%, compared
with 66.5% for the third quarter of 2022. The increase was driven
primarily by improved fixed cost absorption, offset by a lower ASP
and higher warranty reserves. Year-to-date gross margin was 69.6%,
compared with 66.2% for the same period a year ago.
Operating expenses for the third quarter of 2023 were $5.5
million, an increase of 1% over the third quarter of 2022. The
increase was driven primarily by higher incentive compensation
accruals, offset by lower advertising expenses. Advertising costs
of $0.8 million decreased 27% from the third quarter of 2022. Cost
per pipeline add was $2,159, a decrease of 36% from the third
quarter of 2022. Year-to-date operating expenses were $15.9
million, a decrease of 1% from the same period a year ago.
Operating loss for the third quarter of 2023 was $2.0 million,
compared with an operating loss of $2.8 million for the third
quarter of 2022. Net loss for the third quarter of 2023 was $2.0
million, or $0.06 per share, compared with a net loss of $2.8
million, or $0.40 per share, for the third quarter of 2022.
Year-to-date operating loss was $5.8 million, compared with an
operating loss of $8.4 million for the same period a year ago.
Year-to-date net loss was $5.7 million, or $0.21 per share,
compared with a net loss of $8.6 million, or $1.24 per share, for
the same period a year ago.
Adjusted EBITDA for the third quarter of 2023 was $(1.7)
million, compared with $(2.5) million for the third quarter of
2022. Year-to-date Adjusted EBITDA was $(4.9) million, compared
with $(7.4) million for the same period a year ago. A
reconciliation of GAAP net loss to this non-GAAP financial measure
appears below.
Operations Update
The patient pipeline was 1,046 patients as of September 30,
2023. Beginning in 2023, the pipeline only represents patients with
insurance payers, U.S. Veterans Administration hospitals and
Statutory Health Insurance plans in Germany that have previously
paid for a MyoPro. The comparable patient pipeline as of September
30, 2022 was 816 patients, representing a year over year an
increase of 28%. There were 381 patients added to the pipeline in
the third quarter of 2023, an increase of 22% compared with 312
patients with previous payers added in the same period a year
ago.
Separately, the Company allocated resources during the quarter
to build the pipeline of Medicare Part B patients. The Company
intends to continue those efforts in the fourth quarter.
Centers for Medicare & Medicaid Services Update
On November 1, 2023, the Centers for Medicare & Medicaid
Services ("CMS") published a final rule that reclassifies the
MyoPro as a brace, which will become effective on January 1, 2024.
As a result, the Company expects the MyoPro to be reimbursed on a
lump-sum basis, similar to all other payers currently reimbursing
for the MyoPro.
On November 6, 2023, the Company announced that CMS published
proposed fee schedule rates for its Healthcare Common Procedure
Coding System ("HCSPS") codes L8701 and L8702. The proposed fees
for L8701, which covers the MyoPro Motion W and L8702, which covers
the MyoPro Motion G, are $31,745.42 and $62,457.28, respectively.
These payment determinations will be reviewed as part of CMS'
bi-annual HCPCS public meeting to be held on November 29, 2023. In
the meantime, payment amounts for Medicare Part B beneficiaries
will continue to be determined by CMS' regional billing
contractors, known as the DME MAC's.
The Company has filed claims with the DME MAC's, for six MyoPros
provided to Medicare Part B patients. The claims were submitted for
reimbursement as a rental, consistent with the MyoPro’s current
classification. Of these, the Company has received rental payments
for five patients covering all four of the Medicare billing
regions. The claim for the sixth patient is in process, with
medical documentation currently being reviewed under the process of
individual consideration.
"With payments being received from all four of the DME MACs, we
are excited for Medicare beneficiaries to now have access to the
MyoPro like our Medicare Advantage, Veterans Administration and
private insured patients,” added Mr. Gudonis. “In addition, we
continue to support level one research documenting the successful
validated outcomes from the MyoPro. We recently funded two studies
in academic publications proving evidence of successful use in the
home, and independently funded randomized controlled trials by the
Department of Defense and the Veterans Administration are underway
at the Kessler Foundation and the Louis Stokes VA Medical Center,
respectively.”
Business Outlook
“Based on the size of the patient pipeline entering the fourth
quarter, we expect another strong quarter of insurance
authorizations and orders for the MyoPro. The realized revenue for
the quarter will depend on the payer mix, the timing of MyoPro
deliveries and the receipt of reimbursement payments from
insurers,” added Mr. Gudonis. “With the backlog up modestly on a
sequential basis, and assuming a typical number of ‘in-quarter’
fill orders, we believe we are positioned for year-over-year
product revenue growth for the fourth quarter. In addition, we
expect the full year product revenue growth to be consistent with
the growth rate through the first nine months of the year, which is
within our target range of 20-30% growth stated at the beginning of
the year.”
Cash Position
Cash, cash equivalents and short-term investments as of
September 30, 2023 were $11.1 million, Cash used in operating
activities was $1.7 million for the third quarter of 2023, compared
with $2.8 million for the third quarter of 2022.
Conference Call and Webcast
Myomo will hold a conference call today at 4:30 p.m. Eastern
time to discuss these results and answer questions. Participants
are encouraged to pre-register for the call at this link. Callers
who pre-register will be given a conference passcode and unique PIN
to gain immediate access to the call and bypass the live operator.
Participants may pre-register at any time including up to and after
the start of the call. Those unable to pre-register may participate
by dialing 844-707-6932 (U.S.) or 412-317-9250 (International). A
webcast of the call will also be available at Myomo’s Investor
Relations page at http://ir.myomo.com/.
A replay of the webcast will be available beginning
approximately one hour after the completion of the live conference
call at http://ir.myomo.com/. A dial-in replay of the call will be
available until November 21, 2023 at 877-344-7529 (U.S. toll-free),
855-669-9658 (Canada toll-free) or 412-317-0088 (International),
with passcode 5227358.
Non-GAAP Financial Measures
Myomo is providing financial information that has not been
prepared in accordance with generally accepted accounting
principles in the United States, or GAAP. This information includes
Adjusted EBITDA. This non-GAAP financial measure is not in
accordance with, or an alternative for, GAAP and may be different
from similar non-GAAP financial measures used by other companies.
Myomo believes the use of this non-GAAP financial measure provides
supplementary information for investors to use in evaluating
operating performance and in comparing Myomo’s financial measures
with other companies in its industry, many of which present similar
non-GAAP financial measures. Adjusted EBITDA is EBITDA adjusted for
stock-based compensation expense and loss on equity investment.
This non-GAAP financial measure is not meant to be considered
superior to or a substitute for results of operations prepared in
accordance with GAAP, and should be viewed in conjunction with GAAP
financial measures. Investors are encouraged to review the
reconciliation of this non-GAAP measure to its most directly
comparable GAAP financial measure. A reconciliation of GAAP to the
non-GAAP financial measures has been provided in the tables
included as part of this press release.
About Myomo
Myomo, Inc. is a wearable medical robotics company that offers
improved arm and hand function for those suffering from
neurological disorders and upper-limb paralysis. Myomo develops and
markets the MyoPro product line. MyoPro is a powered upper-limb
orthosis designed to support the arm and restore function to the
weakened or paralyzed arms of certain patients suffering from CVA
stroke, brachial plexus injury, traumatic brain or spinal cord
injury, ALS or other neuromuscular disease or injury. It is
currently the only marketed device that, sensing a patient’s own
EMG signals through non-invasive sensors on the arm, can restore an
individual’s ability to perform activities of daily living,
including feeding themselves, carrying objects and doing household
tasks. Many are able to return to work, live independently and
reduce their cost of care. Myomo is headquartered in Boston,
Massachusetts, with sales and clinical professionals across the
U.S. and representatives internationally. For more information,
please visit www.myomo.com.
Forward-Looking Statements
This press release contains forward-looking statements regarding
the Company’s future business expectations, including expectations
for fourth quarter and full year 2023 revenue, expectations
regarding efforts to build the Medicare Part B patient pipeline and
expectations regarding lump sum reimbursement for Medicare Part B
patients, which are subject to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements are only predictions and may differ
materially from actual results due to a variety of factors.
These factors include, among other things:
- We have a history of operating losses and our financial
statements for the period ended September 30, 2023 include
disclosures regarding there being substantial doubt about our
ability to continue as a going concern;
- our ability to obtain sufficient reimbursement from third-party
payers for our products, including CMS for Medicare Part B
patients;
- our revenue concentration with a particular insurance payer as
a result of focusing our efforts on patients with insurers who have
previously reimbursed for the MyoPro;
- our ability to continue normal operations and patient
interactions without supply chain disruption in order to deliver
and fit our custom-fabricated device;
- our marketing and commercialization efforts;
- our dependence upon external sources for the financing of our
operations, to the extent that we do not achieve or maintain cash
flow breakeven;
- our ability to effectively execute our business plan and scale
up our operations;
- our expectations as to our product development programs,
and;
- general market, economic, environmental and social factors that
may affect the evaluation, fitting, delivery and sale of our
products to patients.
More information about these and other factors that potentially
could affect our financial results is included in Myomo’s filings
with the Securities and Exchange Commission, including those
contained in the risk factors section of the Company’s annual
report on Form 10-K, quarterly reports on Form 10-Q and other
filings with the Commission. The Company cautions readers not to
place undue reliance on any such forward-looking statements, which
speak only as of the date made. Although the forward-looking
statements in this release of financial information are based on
our beliefs, assumptions and expectations, taking into account all
information currently available to us, we cannot guarantee future
transactions, results, performance, achievements or outcomes. No
assurance can be made to any investor by anyone that the
expectations reflected in our forward-looking statements will be
attained, or that deviations from them will not be material or
adverse. The Company disclaims any obligation subsequently to
revise any forward-looking statements to reflect events or
circumstances after the date of such statements or to reflect the
occurrence of anticipated or unanticipated events.
MYOMO, INC. CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)
For the Three Months
ended
For the Nine Months
Ended
September 30,
September 30,
2023
2022
2023
2022
Revenue
Product revenue
$
5,029,523
$
3,968,201
$
12,719,855
$
10,513,702
License revenue
50,000
—
1,764,920
1,000,000
5,079,523
3,968,201
14,484,775
11,513,702
Cost of revenue
1,590,675
1,331,217
4,407,269
3,888,217
Gross profit
3,488,848
2,636,984
10,077,505
7,625,485
Operating expenses:
Research and development
717,256
690,407
1,758,481
1,982,815
Selling, general and administrative
4,795,961
4,765,218
14,117,397
14,085,523
5,513,217
5,455,625
15,875,877
16,068,338
Loss from operations
(2,024,369
)
(2,818,641
)
(5,798,372
)
(8,442,853
)
Other (income) expense, net
Interest income
(112,300
)
(33,958
)
(302,053
)
(47,983
)
Other expense, net
467
4,999
6,098
15,640
Loss on equity investment
70,124
16,652
99,840
49,860
(41,709
)
(12,307
)
(196,115
)
17,517
Loss before income taxes
(1,982,660
)
(2,806,334
)
(5,602,256
)
(8,460,370
)
Income tax expense
46,355
23,382
85,204
93,202
Net loss
$
(2,029,016
)
$
(2,829,716
)
$
(5,687,461
)
$
(8,553,572
)
Weighted average number of common
shares outstanding:
Basic and diluted
35,266,361
7,064,188
27,537,257
6,880,918
Net loss per share attributable to
common stockholders
Basic and diluted
$
(0.06
)
$
(0.40
)
$
(0.21
)
$
(1.24
)
MYOMO, INC. CONDENSED CONSOLIDATED
BALANCE SHEETS
September 30,
December 31,
2023
2022
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents
$
6,911,747
$
5,345,967
Short-term investments
4,208,613
—
Accounts receivable, net
2,517,021
1,896,163
Inventories, net
1,484,729
1,399,865
Prepaid expenses and other current
assets
920,076
573,462
Total Current Assets
16,042,186
9,215,457
Operating lease assets with right of
use
715,876
508,743
Equipment, net
172,018
194,283
Investment in Jiangxi Myomo Medical
Assistive Appliance Co., Ltd.
32,648
132,489
Other assets
91,237
111,034
Total Assets
$
17,053,965
$
10,162,006
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current Liabilities:
Accounts payable and accrued expenses
5,225,320
3,086,932
Current operating lease liability
456,064
353,701
Income taxes payable
65,576
140,650
Deferred revenue
30,685
20,653
Total Current Liabilities
5,777,645
3,601,936
Non-current operating lease liability
253,210
200,207
Deferred revenue
—
498
Total Liabilities
6,030,855
3,802,641
Commitments and Contingencies - Note
9
—
—
Stockholders’ Equity:
Preferred stock
—
—
Common stock
2,652
775
Additional paid-in capital
105,506,182
95,105,071
Accumulated other comprehensive income
(loss)
(8,554
)
43,227
Accumulated deficit
(94,470,705
)
(88,783,244
)
Treasury stock, at cost
(6,464
)
(6,464
)
Total Stockholders’ Equity
11,023,111
6,359,365
Total Liabilities and Stockholders’
Equity
$
17,053,965
$
10,162,006
MYOMO, INC. CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (unaudited)
For the Nine Months Ended September
30,
2023
2022
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss
$
(5,687,461
)
$
(8,553,572
)
Adjustments to reconcile net loss to net
cash used in operations:
Depreciation
136,416
143,742
Stock-based compensation
781,513
917,126
Bad debt expense
12,626
26,075
Loss on equity investment
99,840
49,860
Amortization of right-of-use assets
301,053
253,611
Other non-cash charges
(49,271
)
99,771
Changes in operating assets and
liabilities:
Accounts receivable
(625,596
)
362,759
Inventories
(90,100
)
(752,720
)
Prepaid expenses and other current
assets
(439,584
)
240,050
Other assets
19,797
(15,705
)
Accounts payable and accrued expenses
2,141,978
(264,182
)
Income taxes payable
(74,944
)
-
Operating lease liabilities
(352,820
)
(298,380
)
Deferred revenue
9,533
22,244
Net cash used in operating activities
(3,817,019
)
(7,769,321
)
CASH USED IN INVESTING
ACTIVITIES
(4,324,017
)
(307,408
)
CASH PROVIDED BY FINANCING
ACTIVITIES
9,713,426
-
Effect of foreign exchange rate changes on
cash
(6,610
)
(27,629
)
Net increase (decrease) in cash and cash
equivalents
1,565,780
(8,104,358
)
Cash and cash equivalents, beginning of
period
5,345,967
15,524,378
Cash and cash equivalents, end of
period
$
6,911,747
$
7,420,020
MYOMO, INC. RECONCILIATION OF GAAP
NET LOSS TO ADJUSTED EBITDA (unaudited)
For the Three Months
Ended September 30,
For the Nine Months
Ended September 30,
2023
2022
2023
2022
GAAP net loss
$
(2,029,016
)
$
(2,829,716
)
$
(5,687,461
)
$
(8,553,572
)
Adjustments to reconcile to Adjusted
EBITDA:
Interest (income) expense and other
expense, net
(112,300
)
(33,958
)
(302,053
)
(47,983
)
Depreciation expense
35,794
49,097
136,416
143,742
Stock-based compensation
330,394
305,633
781,513
917,126
Loss on investment in minority
interest
70,124
16,652
99,840
49,860
Income tax expense
46,355
23,382
85,204
93,202
Adjusted EBITDA
$
(1,658,648
)
$
(2,468,910
)
$
(4,886,540
)
$
(7,397,625
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231107289748/en/
For Myomo: ir@myomo.com
Investor Relations: Kim Sutton Golodetz LHA Investor Relations
kgolodetz@lhai.com 212-838-3777
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