CytoSorbents Corporation (NASDAQ: CTSO), a leader in the treatment
of life-threatening conditions in the intensive care unit and
cardiac surgery using blood purification via its proprietary
polymer adsorption technology, today reported unaudited financial
and operating results for the quarter ended June 30, 2023.
Second Quarter 2023 Financial Results
- Total revenue for Q2 2023,
including product sales and grant income, was $9.4 million, an
increase of 11% compared to $8.5 million in Q2 2022
- Q2 2023 product sales were $8.1
million versus $7.3 million in Q2 2022, an increase of 10%. The
increase in the average exchange rate of the Euro to the U.S.
dollar positively impacted Q2 2023 product sales by approximately
$187,000
- As expected, there were no COVID-19
related sales during the quarter, reflecting the low severity of
current COVID-19 illness resulting from high rates of vaccination,
anti-viral therapy, and natural immunity
- Product gross margins were
approximately 74% in Q2 2023, compared to 68% in Q1 2023 and 67% in
Q2 2022
- Total cash, including cash and cash
equivalents, and restricted cash was $14.8 million as of June 30,
2023
Recent Operating Highlights:
- The pivotal STAR-T trial completed enrollment ahead of internal
projections among 30 participating trial centers in the U.S. and
Canada. This follows the recommendation by the independent Data and
Safety Monitoring Board (DSMB) in June 2023 to complete the trial
without modifications, after it finished the second scheduled
safety review at 80 patients enrolled
- More than 212,000 CytoSorb devices have been cumulatively
delivered across more than 75 countries worldwide as of the end of
Q2 2023
- Appointed Alexander D’Amico as Chief Financial Officer, who
brings over 20 years of broad finance, SEC reporting, merger and
acquisition, fundraising, and accounting experience to
CytoSorbents, to start August 7, 2023. Interim CFO Kathy Bloch will
continue to serve in a consulting capacity
- Introduced Michael Bator as the new Chairman of the Board of
Directors at the Annual Meeting in June, following the retirement
of Al Kraus as former Chairman. A director of CytoSorbents since
July 2015, Michael is founder and Partner of Quartz Advisory Group,
a capital markets investment bank, and was formerly Managing
Director of Healthcare Research at Jennison Associates, a
multi-strategy buy-side family of investment funds with more than
$175 billion of assets under management
- Announced a theranostic collaboration with Humedics in the
field of liver disease, focused on a joint promotion of CytoSorb, a
superior extracorporeal liver support blood purification therapy,
and Humedics’ LiMAx® test, a rapid and precise E.U. approved
diagnostic using its innovative breath analysis technology to
quantitatively assess liver function
Dr. Phillip Chan, Chief Executive Officer of
CytoSorbents stated, “We are pleased to report another successful
quarter of executing on our three key business objectives for 2023.
Most importantly, we expect to complete the pivotal STAR-T
randomized, controlled trial imminently, following the 30-day
follow-up of the last patient, which we believe puts us on target
for topline data before the end of the year.
1. Opening the U.S.
and Canadian markets with DrugSorb®-ATRWe continue to
march towards our goal of opening the U.S. and Canadian markets
with DrugSorb-ATR through the STAR-T (Safe and
Timely Antithromobotic
Removal of Ticagrelor) and
pending STAR-D programs. We thank our U.S. and Canadian
STAR-T clinical trial investigators and centers, study Principal
Investigators, contract research organizations, and the clinical
team at CytoSorbents, for an outstanding performance in the study
and for completing enrollment well ahead of schedule.
We are also pleased the independent DSMB, following two scheduled
reviews of unblinded safety data on the first 80 patients,
recommended completion of the study without modifications in
June.
We have been working with centers in parallel
during the STAR-T study to ensure timely entry and monitoring of
data, and despite enrolling the final 60 patients in the last 2.5
months of the study with a lot of work ongoing, we expect to
formally complete the study shortly and drive data cleaning and
database lock in the next several months. This will be followed by
statistical analysis of the data, which we believe will enable us
to achieve our goal of announcing topline data before year-end.
Meanwhile, our regulatory personnel have been coordinating the
resources of the company to assemble the regulatory dossier needed
to submit for marketing approval to U.S. FDA and Health Canada,
which we plan to do as soon as possible assuming positive clinical
study data. We plan to follow this with a formal presention of the
data at a major U.S. cardiovascular conference. With improved
visibility on future approval, we expect to execute our
pre-commercialization strategy and begin building our sales and
marketing infrastructure next year.
DrugSorb-ATR targets a large and growing market
opportunity that exists today and we expect it to further
accelerate as low-cost generic versions of ticagrelor become
available starting in 2024. For example, the need to remove
Brilinta® (ticagrelor, AstraZeneca) in patients with acute coronary
syndrome who have received dual anti-platelet therapy (aspirin and
a P2Y12 platelet inhibitor), but now require coronary artery bypass
graft (CABG) surgery, is highlighted by the rapid speed of patient
enrollment in the U.S. and Canadian STAR-T trial. Today, physicians
have the choice of using different P2Y12 anti-platelet drugs,
including Brilinta®, Plavix® (clopidogrel, BMS/Sanofi), and
Effient® (prasugrel, Eli Lilly, Daiichi Sankyo, UBE). Although
Brilinta has superior antithrombotic efficacy to Plavix, Plavix is
still widely used because it is generic and less expensive.
However, since Brilinta is expected to become generic ticagrelor in
2024, we believe it will take market share from both Plavix and
Effient as the price of ticagrelor drops. In addition, if
DrugSorb-ATR is approved to remove Brilinta, Brilinta will become
the only P2Y12 platelet inhibitor with a solution available to
allow timely surgery in patients on the drug – a powerful marketing
message to prescribing cardiologists and emergency room physicians
who know that 5-10% of patients with acute coronary syndrome
treated with a P2Y12 inhibitor will not be candidates for stent
placement and will require surgery and be at high risk of
potentially fatal perioperative bleeding.
The preference for Brilinta (ticagrelor) by U.S.
cardiologists has been highlighted recently in the prestigious JAMA
Network Open publication, entitled, “Assessing the Clinical
Treatment Dynamics of Antiplatelet Therapy Following Acute Coronary
Syndrome and Percutaneous Coronary Intervention in the US” where in
a cohort study of more than 62,000 patients from 2010-2019
demonstrated that “ticagrelor has emerged as the most commonly
prescribed P2Y12 inhibitor” following acute coronary syndrome and
percutaneous coronary intervention. The rise of ticagrelor usage in
this setting can be easily seen in Figure 1, where in 2019,
ticagrelor was the drug of choice in 60.4% of cases, while
clopidogrel (Plavix®) dropped to 29.6%, and prasugrel (Effient®)
dropped to 10.0% of cases. We believe this trend bodes well for
DrugSorb-ATR and supports our contention that the U.S. and Canadian
ticagrelor market will expand over time.
With STAR-T enrollment complete, our clinical
team is now focused on the activities leading up to the analysis of
the results, and if positive, preparation of the documentation
needed for our planned U.S. and Health Canada regulatory
submissions for DrugSorb-ATR. When appropriate, we plan to continue
our STAR (Safe and Timely Antithrombotic Removal) program with the
resumption of the STAR-D trial, that will evaluate the use of
DrugSorb-ATR to remove the direct oral anticoagulant (DOAC) Factor
Xa inhibitors, Eliquis and Xarelto (among the highest revenue
generating pharmaceuticals in the world), and to reduce bleeding
risk in cardiothoracic surgery patients on these
agents. We plan to leverage the same site network as in
STAR-T and based on their feedback that they routinely encounter
patients on DOACs needing cardiac surgery and their proven track
record of trial execution, we believe the STAR-D trial can be run
quickly and cost-effectively.
Finally, CMS recently announced details
surrounding the Transitional Coverage for Emerging Technologies
(TCET) program and are currently in the public comment period. The
current proposed program falls short of what was widely anticipated
by the medical device community and its trade organization,
Advamed, providing a transparent pathway for securing dedicated CMS
national coverage of FDA Breakthrough Designated Devices within 6
months of FDA clearance or approval, but departing from the
automatic four-year national coverage upon FDA approval of
qualified Breakthrough Devices that was discussed by CMS
previously. We expect there to be ongoing discussion and possible
modification of the program. We believe DrugSorb-ATR, as a
Breakthrough Designated Device whose core target population falls
squarely in the age group covered by Medicare, would still be an
excellent candidate for this TCET program and we will continue to
follow the story as it develops. Meanwhile, the STAR-T trial is
expected to provide significant health economics data to support
reimbursement through traditional private and public insurance
pathways.
2. Return to Sales Growth
for CytoSorbCytoSorb targets the massive critical care and
cadiac surgery markets outside the U.S., helping to control deadly
inflammation and other life-threatening conditions such as sepsis,
lung injury, trauma, burn injury, liver failure, complications of
surgery, cytokine release syndrome in cancer immunotherapy, and
many others. Following a post-COVID slowdown in hospital-based
markets globally in 2022, we are pleased to report our third
consecutive quarter of sequential product sales growth and a 10%
increase in Q2 2023, year-over-year. With many new growth
initiatives, and importantly new leadership in key positions in our
therapy area verticals and our overall commercialization
organization, we anticipate further momentum of our business over
time. Importantly, product gross margins have rebounded 700 basis
points to 74%, a trend consistent with our guidance of returning to
75-80% product gross margins on a quarterly basis this year. Our
new manufacturing facility is fully online and producing CytoSorb
devices in volume.
We believe there is now no question of what we
have known for years - that CytoSorb is a powerful treatment of
cytokine storm, particularly following the landmark publication in
the journal Critical Care, describing the excellent effect of
CytoSorb on reducing systemic cytokine levels in a well-controlled
human endotoxin challenge model. We have learned a lot over the
past 11 years of CytoSorb commercialization and the more than
200,000 human treatments administered to date in patients that are
literally battling between life and death. Every study that has
been published - positive, neutral, or negative - has taught us
more about how to best treat patients with CytoSorb. We
have distilled it down to the very simple message of “Right
Patient, Right Timing, Right Dose.”
The concept of treating the right patient at the
right time with the right dose to have good clinical outcomes is,
in fact, relevant to most therapies. For example, antibiotics are
some of the most commonly used drugs in the intensive care unit and
are a perfect analogy for CytoSorb. Certainly you need antibiotics
to kill the pathogen and to survive a life-threatening infection,
just as you need to control the deadly massive inflammatory
response in sepsis with CytoSorb. But despite antibiotics and the
best standard of care (excluding CytoSorb), approximately 20-25% of
patients with sepsis and organ dysfunction will die, and 35-50% of
patients with septic shock will still die. A lot of
these failures can be traced back to not following the “Right
Patient, Right Timing, Right Dose” mantra. For example, if a
patient with an infection is misdiagnosed and treated with the
wrong antibiotic, it will not work (e.g. treating COVID-19 with
penicillin instead of Paxlovid®). Or if an infection is not treated
with antibiotics until the infection has spiraled out of control
and the patient develops sepsis – then this is ‘too little too
late.’ Or if the dose of the antibiotic is not adjusted for the
severity of illness, the antibiotic may not work
optimally.
This is why for the past several years, thanks
to the observations of many dedicated CytoSorb users around the
world, we have been emphasizing the “Right patient, right timing,
and right dose” with the early and aggressive treatment of patients
with clear evidence of hyperinflammation. Many of the older
studies, for example, used CytoSorb relatively late in patients
that had already developed kidney failure and were on dialysis, a
generally later stage complication in critical illness that itself
increases the risk of death, making it more difficult to
demonstrate a benefit. Other studies did not evaluate
the inflammatory status of patients. But when CytoSorb is used
early and aggressively in documented hyperinflamed patients, we
have seen some outstanding results. This includes the recently
published final CTC (CytoSorb Therapy in COVID-19) Registry results
in the journal, Critical Care, detailing the clinical outcomes in
100 critically-ill COVID-19 patients with severe inflammation and
refractory lung failure using CytoSorb with ECMO to achieve
“enhanced lung rest”. Overall, 90-day survival was high at 74% and
in a post-hoc analysis, patients who were treated before the median
treatment time of 87 hours had 82% survival, compared to 66%
survival in patients treated after 87 hours. In addition, those
treated in the early group had significantly shorter median
durations of mechanical ventilation (7 [2–26] vs. 17 [7–37] days,
p=0.02), ECMO support (13 [8–24] vs. 29 [14–38] days, p=0.021) and
ICU stay (17 [10–40] vs 36 [19–55] days, p=0.002).
Importantly, no device-related adverse events were reported.
Overall, our results compare favorably to the approximately 50%
survival reported by the Extracorporeal Life Support Organization
(ECMO) COVID-19 registry looking at ECMO use alone in this
population. Our data support the strategy of early combined usage
of CytoSorb with ECMO to treat severe ARDS and refractory lung
failure and is a prime example of our “hit early, hit hard”
treatment philosophy.
To this end, our current Company-sponsored
trials, such as the PROCYSS refractory septic shock randomized
trial, and the international COSMOS critical illness registry,
incorporate our evolving understanding of how to achieve better and
more consistent results with CytoSorb. We have also been working to
drive earlier usage of CytoSorb in the appropriate patients through
a number of different ways, including for example, pursuing a
theranostic strategy (i.e. using a diagnostic test to guide patient
selection and timing of CytoSorb therapy) as we are doing in our
collaboration with Humedics in the field of liver disease, or by
selling a simple-to-use, relatively low cost hemoperfusion machine
that can run CytoSorb quickly and efficiently, without needing to
wait for patients to develop kidney failure and go on dialysis.
3. Reduced Cash Burn
and Tight Control Over ExpensesBased upon our various cost
controls implemented over the past 12 months, along with an
improvement in sales and product gross margins, our quarterly cash
burn during the first half of 2023 averaged approximately $4.5
million, down significantly from the average quarterly burn in the
first half of 2022 of approximately $11 million. We closed the
quarter with approximately $14.8 million in cash and we believe a
runway to multiple catalysts for our business.”
Dr Chan continued, “Overall, we are excited
about completing the STAR-T trial and potentially being on the cusp
of reporting topline data by the end of the year and the full data
set analysis shortly thereafter. If positive, these data could lead
to U.S. FDA and Health Canada marketing approval for DrugSorb-ATR,
and importantly, commercial revenue targeting an initial $300
million total addressable market in these two countries alone.
Meanwhile, the gradual but steady recovery we are seeing for
CytoSorb is expected to build momentum as the hospital markets
recover, with anticipated future growth of the therapy in so many
different clinical indications addressing multi-billion dollar
markets. If we are successful, we believe CytoSorb and
DrugSorb-ATR could transform CytoSorbents into a dual U.S. and
international growth company, fueled by two major high margin
revenue engines, helping to drive significant shareholder
value.”
Dr. Chan concluded, “Finally we would like to
thank former Chairman Al Kraus and CFO Kathy Bloch for their 20 and
10 years of service, respectively, and their countless
contributions to the success of the Company, and wish them well in
retirement. We also would like to congratulate Michael Bator as our
new Chairman of the Board of Directors and to welcome Alex D’Amico
as our new Chief Financial Officer.”
Results of Operations
Comparison for the three months ended June 30, 2023 and
2022:
Revenues:
Revenue from product sales was approximately
$8,072,000 in the three months ended June 30, 2023, as compared to
approximately $7,331,000 in the three months ended June 30, 2022,
an increase of approximately $741,000, or 10%. Direct sales
increased approximately $331,000, or 8%. Distributor sales
increased approximately $410,000, or 14%. The increase in the
average exchange rate of the Euro to the U.S. dollar positively
impacted second quarter 2023 product sales by approximately
$187,000. For the three months ended June 30, 2023, the average
exchange rate of the Euro to the U.S. dollar was $1.09 was compared
to an average exchange rate of $1.06 for the three months ended
June 30, 2022. There were no sales related to the demand for
CytoSorb to treat COVID-19 patients during the three months ended
June 30, 2023, or for the three months ended June 30, 2022.
Grant income was approximately $1,348,000 for
the three months ended June 30, 2023, as compared to approximately
$1,165,000 for the three months ended June 30, 2022, an increase of
approximately $183,000, or 16%. This increase was a result of a
strategic decision to deploy our research and development employees
exclusively to grant related activities during the three months
ended June 30, 2023.
Total revenues were approximately $9,421,000 for
the three months ended June 30, 2023, as compared to total revenues
of approximately $8,496,000 for the three months ended June 30,
2022, an increase of approximately $925,000, or 11%.
Cost of Revenues:
For the three months ended June 30, 2023, and
2022, cost of revenue was approximately $3,402,000 and $3,551,000,
respectively, a decrease of approximately $149,000. Product cost of
revenue was approximately $2,093,000 and $2,453,000, respectively,
for the three months ended June 30, 2023, and 2022, a decrease of
approximately $360,000. The decrease is due primarily to
inefficiencies associated with the relocation of our production
activities to our new manufacturing facility in Princeton, New
Jersey during the second quarter of 2022 that did not recur in the
second quarter of 2023. Product gross margins were approximately
74% for the three months ended June 30, 2023, as compared to
approximately 67% for the three months ended June 30, 2022.
Research and Development
Expenses:
For the three months ended June 30, 2023,
research and development expenses were approximately $3,669,000, as
compared to research and development expenses of approximately
$4,183,000 for the three months ended June 30, 2022, a decrease of
approximately $514,000. This decrease was due to a decrease in our
clinical trial activities of approximately $627,000 related to the
pause of our STAR-D trial in November 2022. This decrease was
offset by approximately $70,000 of costs incurred related to
pre-production manufacturing activities required to bring the new
manufacturing plant to a state of commercial readiness and an
increase in non-grant related research and development costs of
approximately $43,000.
Legal, Financial, and Other Consulting
Expenses:
Legal, financial, and other consulting expenses
were approximately $1,185,000 for the three months ended June 30,
2023, as compared to approximately $679,000 for the three months
ended June 30, 2022, an increase of approximately $506,000. This
increase was due to an increase in legal fees and expected
settlement costs of pending litigation of approximately $306,000,
other increases in legal expenses of approximately $174,000, and
the write-off of certain patent costs and an increase in accounting
fees and other consulting fees of approximately $26,000.
Selling, General and Administrative
Expenses:
Selling, general and administrative expenses
were approximately $7,724,000 for the three months ended June 30,
2023, as compared to approximately $8,439,000 for the three months
ending June 30, 2022, a decrease of $715,000. This decrease was due
to a decrease in non-cash stock compensation expense of
approximately $191,000, a decrease in travel and entertainment
expenses of approximately $99,000, a decrease in public relations
costs of approximately $96,000, a decrease in advertising costs of
approximately $82,000, a decrease in royalty expense of
approximately $73,000, a decrease in commercial insurance of
approximately $56,000, a decrease in salaries, commissions and
related costs of approximately $43,000, and a decrease in other
general and administrative expenses of approximately $75,000.
Gain (Loss) on Foreign Currency
Transactions:
For the three months ended June 30, 2023, the
gain on foreign currency transactions was approximately $415,000 as
compared to a loss of approximately $2,523,000 for the three months
ended June 30, 2022. The 2023 gain was directly related to the
increase in the spot exchange rate of the Euro to the U.S. dollar
at June 30, 2023 as compared to March 31, 2023. The spot exchange
rate of the Euro to the U.S. dollar was $1.091 per Euro at June 30,
2023, as compared to $1.086 per Euro at March 31, 2023. The 2022
loss was directly related to the decrease in the spot exchange rate
of the Euro at June 30, 2022 as compared to March 31, 2022. The
spot exchange rate of the Euro to the U.S. dollar was $1.05 per
Euro as of June 30, 2022, as compared to $1.11 per Euro as of March
31, 2022.
Comparison for the six months ended June 30, 2023, and
2022:
Revenues:
Revenue from product sales was approximately
$15,982,000 for the six months ended June 30, 2023, as compared to
approximately $15,255,000 for the six months ended June 30, 2022,
an increase of approximately $727,000, or 5%. Distributor sales
increased by approximately $597,000, or 10%. Overall direct sales
increased by approximately $130,000, or 1%. The change in the
exchange rate of the Euro to U.S. dollar did not have a significant
impact on product sales during the six months ended June 30,
2023.
Grant income was approximately $2,888,000 for
the six months ended June 30, 2023, as compared to approximately
$1,932,000 for the six months ended June 30, 2022, an increase of
approximately $956,000 or 49%. During the six months ended June 30,
2022, our research and development employees were either deployed
to work-from-home status or reassigned to assist in activities
related to increasing the production of CytoSorb. In 2023, research
and development employees were assigned exclusively to grant and
other research and development activities.
Total revenues were approximately $18,870,000
for the six months ended June 30, 2023, as compared to total
revenues of approximately $17,187,000 for the six months ended June
30, 2022, an increase of approximately $1,683,000, or 10%.
Cost of Revenues:
For the six months ended June 30, 2023 and 2022,
cost of revenue was approximately $7,396,000 and $5,828,000,
respectively, an increase of approximately $1,568,000. Product cost
of revenue was approximately $4,624,000 and $4,008,000,
respectively, for the six months ended June 30, 2023 and 2022, an
increase of approximately $616,000 and grant cost of revenue
increased by approximately $952,000. These increases were due
primarily to increases in both product sales and grant revenue.
Product gross margins were approximately 71% for the six months
ended June 30, 2023, and approximately 74% for the six months ended
June 30, 2022. The reduction in product gross margin is due
primarily to start-up costs associated with our new manufacturing
facility in Princeton, New Jersey during the six months ended June
30, 2023.
Research and Development
Expenses:
For the six months ended June 30, 2023, research
and development expenses were approximately $7,883,000 as compared
to research and development expenses of approximately $8,427,000
for the six months ended June 30, 2022, a decrease of approximately
$544,000. This decrease was due to a decrease in costs associated
with our clinical trial activities of approximately $1,434,000
related to the pause of our STAR-D trial in November 2022, and a
decrease in non-grant related research and development activities
of approximately $29,000. These decreases were offset by
approximately $919,000 of costs incurred related to pre-production
manufacturing activities required to bring the new manufacturing
plant to a state of commercial readiness.
Legal, Financial, and Other Consulting
Expenses:
Legal, financial, and other consulting expenses
were approximately $1,854,000 for the six months ended June 30,
2023, as compared to approximately $1,480,000 for the six months
ending June 30, 2022. The increase of approximately $374,000 was
due an increase in legal fees and expected settlement costs of
pending litigation of approximately $306,000 and an increase in
employment agency fees of approximately $80,000. These increases
were offset by a decrease in consulting fees of approximately
$12,000.
Selling, General and Administrative
Expenses:
Selling, general and administrative expenses
were approximately $16,187,000 for the six months ended June 30,
2023, as compared to $17,600,000 for the six months ended June 30,
2022, a decrease of $1,413,000. This decrease was due to a decrease
in salaries, commissions and related costs of approximately
$683,000, a decrease in non-cash stock compensation expense of
approximately $148,000, a decrease in commercial insurance expenses
of approximately $131,000, a decrease in travel and entertainment
expenses of approximately $127,000, a decrease in public relations
costs of approximately $119,000, a decrease in advertising costs of
approximately $100,000, a decrease in royalty expense of
approximately $68,000 and a decrease in other general and
administrative expenses of approximately $37,000.
Gain (Loss) on Foreign Currency
Transactions:
For the six months ended June 30, 2023, the gain
on foreign currency transactions was approximately $1,076,000 as
compared to a loss of approximately $3,736,000 for the six months
ended June 30, 2022. The 2023 gain was directly related to the
increase in the spot exchange rate of the Euro to the U.S. dollar
as of June 30, 2023, as compared to December 31, 2022. The spot
exchange rate of the Euro to the U.S. dollar was $1.09 per Euro as
of June 30, 2023, as compared to $1.07 per Euro at December 31,
2022. The 2022 loss was directly related to the decrease in the
spot exchange rate of the Euro as of June 30, 2022, as compared to
December 31, 2021.
Liquidity and Capital
Resources
Since inception, our operations have been
primarily financed through the issuance of debt and equity
securities. As of June 30, 2023, we had current assets of
approximately $23,644,000 and current liabilities of approximately
$10,351,000. As of June 30, 2023, $25 million of our total shelf
amount was allocated to our ATM facility, of which approximately
$22.8 million is still available. In April of 2023, we received
approximately $1,000,000 in cash from the approved sale of our net
operating losses and research and development credits from the
State of New Jersey.
We are also managing our resources proactively,
continuing to invest in key areas such as our U.S. pivotal STAR-T
trial. We have instituted tight cost controls which are expected to
materially reduce our planned cash burn in 2023.
We believe that we have sufficient cash to fund
the Company’s operations through 2023. We will need to raise
additional capital to support our ongoing operations in the
future.
Q2 2023 Earnings Conference
Call
The Company will conduct its second quarter 2023
results call today at 4:30 p.m. Eastern time.
Conference Call Details:Date: Tuesday, August 1,
2023Time: 4:30 PM Eastern Time Live Presentation Webcast:
https://edge.media-server.com/mmc/p/ux9gjyvu
For those participants who cannot join by webcast, we are
pleased to offer a conference call option accessible through the
following link:
https://register.vevent.com/register/BIb5f023a4734446ce8e778065c2d484d9
- Click on the call link and complete
the online registration form.
- Upon registering you will receive
the dial-in info and a unique PIN to join the call, as well as an
email confirmation with the details.
- Select a method for joining the
call.
- Dial-In: A dial in number and
unique PIN are displayed to connect directly from your phone.
- Call Me: Enter your phone number
and click “Call Me” for an immediate callback from the system.
- For either the webcast or
conference call, it is recommended that participants log or dial in
approximately 10 minutes prior to the start of the call.
An archived recording of the conference call
will be available under the Investor Relations section of the
Company’s website at
http://cytosorbents.com/investor-relations/financial-results/
About CytoSorbents Corporation (NASDAQ:
CTSO)
CytoSorbents Corporation is a leader in the
treatment of life-threatening conditions in the intensive care unit
and in cardiac surgery through blood purification. Its lead
product, CytoSorb®, is approved in the European Union and
distributed in 75 countries worldwide. It is an extracorporeal
cytokine adsorber that reduces “cytokine storm” or “cytokine
release syndrome” in common critical illnesses that can lead to
massive inflammation, organ failure and patient death. In these
diseases, the risk of death can be extremely high, and there are
few, if any, effective treatments. CytoSorb is also used during and
after cardiothoracic surgery to remove antithrombotic drugs and
inflammatory mediators that can lead to postoperative
complications, including severe bleeding and multiple organ
failure. At the end of Q2 2023, more than 212,000 CytoSorb devices
had been used cumulatively. CytoSorb was originally launched in the
European Union under CE mark as the first cytokine adsorber.
Additional CE mark extensions were granted for bilirubin and
myoglobin removal in clinical conditions such as liver disease and
trauma, respectively, and
for ticagrelor and rivaroxaban removal in
cardiothoracic surgery procedures. CytoSorb has also
received FDA Emergency Use Authorization in the United
States for use in adult critically ill COVID-19 patients with
impending or confirmed respiratory failure. The DrugSorb™-ATR
antithrombotic removal system, based on the same polymer technology
as CytoSorb, also received two FDA Breakthrough Device
Designations, one for the removal of ticagrelor and
another for the removal of the direct oral anticoagulants
(DOAC) apixaban and rivaroxaban in a cardiopulmonary bypass
circuit during urgent cardiothoracic procedures. The Company is
currently completing the FDA-approved, randomized, controlled
STAR-T (Safe and Timely Antithrombotic Removal-Ticagrelor) study of
140 patients at approximately 30 centers in U.S. and Canada to
evaluate whether intraoperative use of DrugSorb-ATR can reduce the
perioperative risk of bleeding in patients receiving ticagrelor and
undergoing cardiothoracic surgery. This pivotal study is intended
to support U.S. FDA and Health Canada marketing approval for
DrugSorb-ATR in this application.
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. Its technologies have
received non-dilutive grant, contract, and other funding of
approximately $48 million from DARPA, the U.S. Department of
Health and Human Services (HHS), the National Institutes of Health
(NIH), National Heart, Lung, and Blood Institute (NHLBI), the U.S.
Army, the U.S. Air Force, U.S. Special Operations Command (SOCOM),
Air Force Material Command (USAF/AFMC), and others. The Company has
numerous marketed products and products under development based
upon this unique blood purification technology protected by many
issued U.S. and international patents and registered trademarks,
and multiple patent applications pending, including ECOS-300CY®,
CytoSorb-XL™, HemoDefend-RBC™, HemoDefend-BGA™, VetResQ®,
K+ontrol™, DrugSorb™, ContrastSorb, and others. For more
information, please visit the Company’s websites
at www.cytosorbents.com and www.cytosorb.com or
follow us on Facebook and Twitter.
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, future targets and
outlooks for our business, statements about potential exposures
resulting from our cash positions, 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, 2023, 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 CORPORATIONCONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(amounts in thousands, except per share
data)
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
CytoSorb sales |
|
$ |
8,066 |
|
|
$ |
7,038 |
|
|
$ |
15,972 |
|
|
|
$ |
14,905 |
|
Other sales |
|
|
6 |
|
|
|
293 |
|
|
|
10 |
|
|
|
|
350 |
|
Total product sales |
|
|
8,072 |
|
|
|
7,331 |
|
|
|
15,982 |
|
|
|
|
15,255 |
|
Grant income |
|
|
1,349 |
|
|
|
1,165 |
|
|
|
2,888 |
|
|
|
|
1,932 |
|
Total revenue |
|
|
9,421 |
|
|
|
8,496 |
|
|
|
18,870 |
|
|
|
|
17,187 |
|
Cost of revenue |
|
|
3,402 |
|
|
|
3,551 |
|
|
|
7,396 |
|
|
|
|
5,828 |
|
Gross profit |
|
|
6,019 |
|
|
|
4,945 |
|
|
|
11,474 |
|
|
|
|
11,359 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
3,669 |
|
|
|
4,184 |
|
|
|
7,883 |
|
|
|
|
8,427 |
|
Legal, financial and other consulting |
|
|
1,185 |
|
|
|
679 |
|
|
|
1,854 |
|
|
|
|
1,480 |
|
Selling, general and administrative |
|
|
7,724 |
|
|
|
8,439 |
|
|
|
16,188 |
|
|
|
|
17,600 |
|
Total expenses |
|
|
12,578 |
|
|
|
13,302 |
|
|
|
25,925 |
|
|
|
|
27,507 |
|
Loss from operations |
|
|
(6,559 |
) |
|
|
(8,357 |
) |
|
|
(14,451 |
|
) |
|
|
(16,148 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income/(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense),
net |
|
|
(9 |
) |
|
|
24 |
|
|
|
(72 |
|
) |
|
|
32 |
|
Gain (loss) on foreign
currency transactions |
|
|
415 |
|
|
|
(2,523 |
) |
|
|
1,076 |
|
|
|
|
(3,736 |
) |
Miscellaneous Income
(Expense) |
|
|
-- |
|
|
|
(23 |
) |
|
|
(32 |
|
) |
|
|
6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income (expense),
net |
|
|
406 |
|
|
|
(2,522 |
) |
|
|
972 |
|
|
|
|
(3,698 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before benefit
from income taxes |
|
|
(6,153 |
) |
|
|
(10,879 |
) |
|
|
(13,479 |
|
) |
|
|
(19,846 |
) |
Benefit from income taxes |
|
|
-- |
|
|
|
-- |
|
|
|
-- |
|
|
|
|
-- |
|
Net loss |
|
$ |
(6,153 |
) |
|
$ |
(10,879 |
) |
|
$ |
(13,479 |
|
) |
|
$ |
(19,846 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per
common share |
|
$ |
(0.14 |
) |
|
$ |
(0.25 |
) |
|
$ |
(0.31 |
|
) |
|
$ |
(0.46 |
) |
Weighted average number of
shares of common stock outstanding |
|
|
44,015,380 |
|
|
|
43,560,481 |
|
|
|
43,758,888 |
|
|
|
|
43,524,414 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(6,153 |
) |
|
$ |
(10,879 |
) |
|
$ |
(13,479 |
|
) |
|
$ |
(19,846 |
) |
Other comprehensive income
(loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency translation adjustment |
|
|
(393 |
) |
|
|
2,053 |
|
|
|
(1,001 |
) |
|
|
|
3,016 |
|
Comprehensive loss |
|
$ |
(6,546 |
) |
|
$ |
(8,826 |
) |
|
$ |
(14,480 |
|
) |
|
$ |
(16,830 |
) |
CYTOSORBENTS CORPORATIONCONDENSED CONSOLIDATED
BALANCE SHEETS(amounts in thousands)
|
|
June 30, 2023 |
|
|
December 31, 2022 |
|
ASSETS: |
|
|
|
|
|
|
Current
Assets: |
|
|
|
|
|
|
Cash and cash
equivalents |
$ |
13,151 |
|
$ |
22,145 |
|
Grants and
accounts receivable, net |
|
7,025 |
|
|
5,665 |
|
Inventories |
|
2,046 |
|
|
3,461 |
|
Prepaid expenses
and other current assets |
|
1,422 |
|
|
2,489 |
|
Total current assets |
|
23,644 |
|
|
33,760 |
|
|
|
|
|
|
|
|
Property and
equipment, net |
|
10,502 |
|
|
10,743 |
|
Restricted
Cash |
|
1,687 |
|
|
1,687 |
|
Right of use
asset |
|
12,334 |
|
|
12,604 |
|
Other assets |
|
4,278 |
|
|
4,438 |
|
TOTAL ASSETS |
$ |
52,445 |
|
$ |
63,232 |
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY: |
|
|
|
|
|
|
Current
Liabilities: |
|
|
|
|
|
|
Accounts
payable |
$ |
2,836 |
|
$ |
1,655 |
|
Lease liability -
current portion |
|
114 |
|
|
109 |
|
Accrued expenses
and other current liabilities |
|
7,401 |
|
|
7,951 |
|
Total current liabilities |
|
10,351 |
|
|
9,715 |
|
Lease liability,
net of current portion |
|
12,978 |
|
|
13,142 |
|
Long-term
debt |
|
5,021 |
|
|
5,000 |
|
TOTAL LIABILITIES |
|
28,350 |
|
|
27,857 |
|
|
|
|
|
|
|
|
Total
stockholders’ equity |
|
24,095 |
|
|
35,375 |
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND STOCKHOLDERS’ EQUITY |
$ |
52,445 |
|
$ |
63,232 |
|
|
|
|
|
|
|
Please Click to Follow Us on
Facebook and
Twitter
U.S. Company Contact:Kathleen Bloch, Interim
CFO305 College Road EastPrinceton, NJ 08540+1 (732)
398-5429kbloch@cytosorbents.com
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