RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--TransEnterix, Inc. (NYSE MKT:TRXC), a medical device company that is pioneering the use of robotics and flexible instruments to improve minimally invasive surgery, today announced its operating and financial results for the third quarter 2014.
- In August 2014, Dr. Helmuth Billy performed a successful sleeve gastrectomy surgery using TransEnterix’s Flex Ligating Shears, which was broadcast at the 5th International Conference on Sleeve Gastrectomy. TransEnterix's Flex Ligating Shears are the only fully flexible advanced energy device available that offers ligation and division of tissue with direct thermal fusion.
- In September 2014, the Company expanded its existing loan agreement with Oxford Finance LLC and Silicon Valley Bank to provide for up to $25.0 million in growth capital.
- The Company expects to make a 510(k) submission for the SurgiBot™ system in mid-2015. The Company previously anticipated making its 510(k) submission in the fourth quarter of 2014.
“We continue to make substantial progress toward the submission of a 510(k) for the SurgiBot system, having manufactured fully integrated SurgiBot systems, completed functional testing and conducted successful pre-clinical surgical procedures,” said Todd M. Pope, President and Chief Executive Officer of TransEnterix. “While we are disappointed to extend the timeline for our submission, it remains our top priority as a company and we are confident in our ability to make the submission in the middle of 2015.”
Comparison of Selected Consolidated Financial Results (in thousands, except netloss per share)
Three Months Ended September 30,
|Net loss per share||$||0.18||$||1.06|
|Weighted average common shares||63,068||10,584|
Revenue was $61 thousand in the third quarter of 2014 as compared to $362 thousand in the third quarter of 2013. The decrease in revenue was attributable to lower sales volumes of SPIDER® Surgical System as we continue to focus resources on our SurgiBot system development.
Cost of goods sold was $202 thousand in the third quarter of 2014, compared with $2.1 million in the third quarter of 2013. The decrease was primarily the result of lower revenues as we limit sales of the SPIDER Surgical System to existing customers, discontinued production of the SPIDER Surgical System, and transferred employees from manufacturing and quality departments to research and development and regulatory functions.
Research and development expenses were $9.1 million in the third quarter of 2014, compared with $2.9 million in the third quarter of 2013. The increase in expenses was attributable to increased investment in SurgiBot development, including development materials, contract engineering and higher personnel-related costs as we expanded our research and development and regulatory capability.
Sales and marketing expenses remained relatively flat at $456 thousand for the third quarter in comparison to $438 thousand in the prior year period.
General and administrative expenses for the third quarter of 2014 were $1.6 million compared to $1.3 million in the third quarter of 2013. The increase in expenses was due to increased stock-based compensation costs, increased taxes, and increased professional development, offset by decreased compensation costs.
Net loss in the third quarter of 2014 was $11.5 million compared to a net loss of $11.3 million in the third quarter of 2013. Net loss per common share was $0.18 in the third quarter of 2014 based on 63.1 million weighted average common shares outstanding compared to a net loss per share of $1.06 in the third quarter of 2013 based on 10.6 million weighted average common shares outstanding.
Cash and cash equivalents were $44.3 million as of September 30, 2014.
TransEnterix, Inc. will host a conference call on Thursday, November 6, 2014 at 8:30 AM ET to discuss its third quarter operating and financial results. To listen to the conference call on your telephone, please dial (800) 263-8506 for domestic callers or (719) 457-2640 for international callers approximately ten minutes prior to the start time. To access the live audio webcast or archived recording, use the following link http://ir.transenterix.com/events.cfm. The replay will be available on the Company's website.
On September 3, 2013, SafeStitch Medical, Inc. (now TransEnterix, Inc.) and TransEnterix Surgical, Inc., formerly known as TransEnterix, Inc., consummated a merger transaction (the “Reverse Merger”) whereby TransEnterix Surgical, Inc. merged with a merger subsidiary of SafeStitch Medical, Inc., with TransEnterix Surgical, Inc. as the surviving entity in the merger. As a result of the merger, TransEnterix Surgical, Inc. became a wholly owned subsidiary of SafeStitch Medical, Inc. On December 6, 2013, SafeStitch Medical, Inc. changed its corporate name to TransEnterix, Inc.
The Reverse Merger has been accounted for as a reverse acquisition under which TransEnterix Surgical, Inc. was considered the acquirer of SafeStitch Medical, Inc. As such, the financial statements of TransEnterix Surgical, Inc. are treated as the historical financial statements of the combined company, with the results of SafeStitch Medical, Inc. being included from September 3, 2013.
TransEnterix is a medical device company that is pioneering the use of robotics and flexible instruments to improve minimally invasive surgery. The company is focused on the development and commercialization of the SurgiBot™ system, a minimally invasive surgical robotic system that allows the surgeon to be patient-side within the sterile field. For more information, visit the company's website at www.transenterix.com.
This press release includes statements relating to the SurgiBot system, our flexible energy device and our current regulatory and commercialization plans for these products. These statements and other statements regarding our future plans and goals constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control, and which may cause results to differ materially from expectations, including whether we will successfully submit our SurgiBot system regulatory filings in mid-2015, and whether we will be able to bring the SurgiBot system to the market. Factors that could cause our results to differ materially from those described include, but are not limited to, whether the SurgiBot system's 510(k) application(s) will be cleared by the U.S. FDA, whether the combined company will be successful in 2014 and beyond, the pace of adoption of our product technology by surgeons, the outcome of coverage and reimbursement decisions by the government and third party payors, the success and market opportunity of our continuing and new product development efforts, including the SurgiBot system, the effect on our business of existing and new regulatory requirements, and other economic and competitive factors. For a discussion of the most significant risks and uncertainties associated with TransEnterix's business, please review our filings with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K for the year ended December 31, 2013 filed on March 5, 2014 as amended, and other filings we make with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
|Consolidated Statements of Operations and Comprehensive Loss|
|(in thousands, except per share amounts)|
Three months ended
Nine months ended
|Cost of goods sold||202||2,058||660||4,096|
|Research and development||9,067||2,909||21,960||7,855|
|Sales and marketing||456||438||1,323||1,490|
|General and administrative||1,606||1,278||5,133||2,665|
|Total Operating Expenses||11,331||9,574||29,076||18,997|
|Remeasurement of fair value of preferred stock warrant liability||—||(1,800||)||—||(1,800||)|
|Interest expense, net||(237||)||(253||)||(764||)||(742||)|
|Total Other Expense, net||(237||)||(2,053||)||(764||)||(2,542||)|
|Other comprehensive income (loss)||—||—||—||—|
|Net loss per share - basic and diluted||$||(0.18||)||$||(1.06||)||$||(0.52||)||$||(4.75||)|
|Weighted average common shares outstanding - basic and diluted||63,068||10,584||57,212||4,282|
|Consolidated Balance Sheets|
|(in thousands, except share amounts)|
|Cash and cash equivalents||$||44,344||$||10,014|
|Accounts receivable, net||38||188|
|Other current assets||833||593|
|Total Current Assets||45,482||17,755|
|Property and equipment, net||2,901||1,864|
|Intellectual property, net||2,366||2,741|
|Trade names, net||8||10|
|Other long term assets||71||127|
|Liabilities and Stockholders’ Equity|
|Note payable - current portion||—||3,879|
|Total Current Liabilities||5,021||7,089|
|Long Term Liabilities|
|Note payable - less current portion, net of debt discount||9,871||4,602|
|Commitments and Contingencies|
|Preferred stock, $0.01 par value, 25,000,000 shares authorized at September 30, 2014 and December 31, 2013, no shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively||—||—|
|Common stock $0.001 par value, 750,000,000 shares authorized at September 30, 2014 and December 31, 2013; 63,096,816 and 48,841,417 shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively(1)||63||49|
|Additional paid-in capital||257,802||203,238|
|Total Stockholders’ Equity||130,028||105,023|
|Total Liabilities and Stockholders’ Equity||$||144,920||$||116,714|
(1) Adjusted for 1:5 reverse stock split on March 31, 2014.
|Consolidated Statements of Cash Flows|
Nine Months Ended
|Net loss||$ (29,573 )||$ (20,327 )|
|Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:|
|Depreciation and amortization||936||1,064|
|Amortization of debt issuance costs||56||78|
|Remeasurement of fair value of preferred stock warrant liability||—||1,800|
|Accretion of bond discount||—||(1)|
|Loss on disposal of property and equipment||5||32|
|Impairment loss on property and equipment||—||304|
|Changes in operating assets and liabilities:|
|Other current and long term assets||(240 )||(527 )|
|Net cash and cash equivalents used in operating activities||(24,210)||(14,047 )|
|Purchase of investments||—||(1,104)|
|Proceeds from sale and maturities of investments||6,191||907|
|Proceeds from sale of property and equipment||25||—|
|Cash received in acquisition of a business, net of cash paid||—||305|
|Purchase of property and equipment||(1,626)||(724)|
|Net cash and cash equivalents provided by (used in) investing activities||4,590||(616)|
|Payment of debt||(2,877 )||(601)|
|Proceeds from the issuance of common stock, net of issuance costs||52,433||—|
|Proceeds from issuance of debt, net of debt discount||4,321||1,998|
|Proceeds from issuance of preferred stock, net of issuance costs||—||28,199|
|Proceeds from exercise of stock options and warrants||73||—|
|Net cash and cash equivalents provided by financing activities||53,950||29,596|
|Net increase in cash and cash equivalents||34,330||14,933|
|Cash and Cash Equivalents, beginning of period||10,014||8,896|
|Cash and Cash Equivalents, end of period||$ 44,344||$ 23,829|
|Supplemental Disclosure for Cash Flow Information|
|Interest paid||$ 518||$ 625|
|Supplemental Schedule of Noncash Investing and Financing Activities|
|Issuance of preferred stock warrants and debt issuance costs||$ —||$ 128|
|Issuance of common stock warrants||$ 54||$ —|
|Conversion of bridge notes to preferred stock||$ —||$ 1,998|
|Conversion of preferred stock warrants to common stock warrants||$ —||$ 1,909|