Full Press Release Details
ClearPoint Neuro Reports Record Revenue in First Quarter 2021 Results,
FDA Clearance of the SmartFrame Array'
SOLANA BEACH, CA, May 11, 2021 - ClearPoint Neuro, Inc.
(Nasdaq: CLPT) (the "Company"), a global therapy-enabling platform company providing navigation and delivery to the brain,
today announced financial results for its first quarter ended March 31, 2021.
First Quarter Highlights
"Our goal for the past year has been to exit the pandemic
stronger than when we entered it," commented Joe Burnett, President and CEO of ClearPoint Neuro. "I am so proud of this team
for recognizing the importance of what our company is doing for patients, leading by example, and getting stronger each day. We had an
excellent quarter across our entire business, including functional neurosurgery cases and disposables, biologics and drug delivery products
and services, as well as capital sales, despite significant hospital budget constraints and access. Most importantly, we continue
to add amazing members to this team, enabled by a successful public equity offering in February, resulting in a cash balance of nearly
$65.0 million at the end of the first quarter. For the first time in our history, we have the team and resources to execute against our
strategic plan and become a premier platform neurosurgery company across multiple indications, especially gene and stem cell therapy
Financial Results - Quarter Ended March 31, 2021
Total revenue was $4.0 million for the three months ended
March 31, 2021, and $3.1 million for the three months ended March 31, 2020, which represents an increase of $0.9 million, or 29%.
Functional neurosurgery navigation revenue, which consists of disposable product
commercial sales related to cases utilizing the ClearPoint system, increased 10% to $1.9 million for the three months ended March 31,
2021, from $1.7 million for the same period in 2020. This increase reflects the resumption in the three months ended March 31, 2021, of
elective surgical procedures, which were postponed or cancelled during the three months ended March 31, 2020, due to the effects of the
COVID-19 pandemic. Case volume increased each month in the quarter.
Biologics and drug delivery revenue, which include sales
of disposable products and services related to customer-sponsored clinical trials utilizing our products, increased 61% to $1.7 million
for the three months ended March 31, 2021, from $1.0 million for the same period in 2020, due primarily to the resumption of clinical
trial activities that led to increased sales of biologics and drug delivery products.
Capital equipment and software revenue, consisting of sales
of ClearPoint reusable hardware and software, and of related services, increased 31% to $0.5 million for the three months ended March
31, 2021, from $0.3 million for the same period in 2020. While revenue from this product line historically has varied from quarter to
quarter, the Company believes that the increase represents the partial resumption of hospitals' capital equipment acquisition activities
following the onset of the COVID-19 pandemic. While hospital budget constraints caused by the pandemic continue to be a real headwind,
the current funnel of potential installs is larger than it has ever been in the Company's history.
Gross margin for the three months ended March 31, 2021 was
65%, compared to 70% for the same period in 2020. This decrease was due primarily to: (a) a greater contribution in the first quarter
of 2020 to total sales of service revenue, which provide higher gross margins in comparison to other product lines, due to the
adverse effects during the 2020 period of the COVID-19 pandemic on hospitals' purchases of products, as discussed above; and (b)
a greater portion of overhead allocated to cost of revenue resulting from larger production output volume during the three months ended
March 31, 2021, relative to the same period in 2020.
Research and development costs were $1.6 million for the
three months ended March 31, 2021, compared to $0.8 million for the same period in 2020, an increase of $0.8 million, or 91%. Sales and
marketing expenses were $1.6 million for the three months ended March 31, 2021, compared to $1.3 million for the same period in 2019,
an increase of $0.3 million, or 21%. Both of these increases reflect additions in key areas to the Company's team, as it
builds the infrastructure necessary to expand product lines, launch new indications, and comply with global standards as installations
take place around the world. General and administrative expenses were $1.7 million for the three months ended March 31, 2021, compared
to $1.3 million for the same period in 2020, an increase of $0.4 million, or 30%. This increase was due primarily to increases in insurance,
occupancy costs, and incentive-based and share-based compensation.
At March 31, 2021, the Company had cash and cash equivalents
totaling $64.9 million as compared to $20.1 million at December 31, 2020, with the increase resulting primarily from the completion of
a public offering of its common stock in February 2021.
Teleconference Information
Investors and analysts are invited to listen to a live broadcast
review of the Company's 2021 first quarter financial results today at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) that may be accessed
online here or by visiting the Company's website at www.clearpointneuro.com
and selecting "Investors" / "News" / "IR Calendar." Investors and analysts who would like
to participate in the conference call may do so via telephone at (877) 407-9034 or at (201) 493-6737 if calling from outside the U.S.
For those who cannot access
the live broadcast, a replay will be available shortly after the completion of the call until June 11,
2021 by calling (877) 660-6853 or (201) 612-7415 if calling from outside the U.S. or Canada, and then entering conference I.D. number
413671. An online archive of the broadcast will be available on the Company's website at www.clearpointneuro.com
on the "Investor Relations" page.
About ClearPoint Neuro
ClearPoint Neuro's mission is to improve and restore
quality of life to patients and their families by enabling therapies for the most complex neurological disorders with pinpoint accuracy.
Applications of the Company's current product portfolio include deep-brain stimulation, laser ablation, biopsy, neuro-aspiration,
and delivery of drugs, biologics, and gene therapy to the brain. The ClearPoint Neuro Navigation System has FDA clearance, is CE-marked,
and is installed in over 60 active clinical sites in the United States, Canada and Europe. The Company's SmartFlow
cannula is being used in partnership or evaluation with approximately 30 individual biologics and drug delivery companies in various
stages - from preclinical research to late-stage regulatory trials. To date, more than 4,500 cases have been performed and supported
by the Company's field-based clinical specialist team, which offers support and services for the Company's partners. For
more information, please visit www.clearpointneuro.com.
Forward-Looking Statements
Statements herein concerning the Company's plans, growth
and strategies may include forward-looking statements within the context of the federal securities laws. Statements regarding the Company's
future events, developments and future performance, as well as management's expectations, beliefs, plans, estimates or projections relating
to the future, are forward-looking statements within the meaning of these laws. Uncertainties and risks may cause the Company's actual
results to differ materially from those expressed in or implied by forward-looking statements. Particular uncertainties and risks include
those relating to: the impact of the COVID-19 pandemic and the measures adopted to contain its spread; future revenue from sales of the
Company's ClearPoint Neuro Navigation System products; and the Company's ability to market, commercialize and achieve broader
market acceptance for the Company's ClearPoint Neuro Navigation System products. More detailed information on these and additional
factors that could affect the Company's actual results are described in the "Risk Factors" section of the Company's
Annual Report on Form 10-K for the year ended December 31, 2020, which has been filed with the Securities and Exchange Commission, and
the Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2021, which the Company intends to file with the
Securities and Exchange Commission on or before May 17, 2021.
Danilo D'Alessandro, Chief Financial Officer
Caroline Corner, Investor Relations
CLEARPOINT NEURO, INC.
Consolidated Statements of Operations
(Dollars in thousands, except for per share data)
| For The Three Months Ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Revenue: | ||||||||
| Product revenue | $ | 3,162 | $ | 2,179 | ||||
| Service and other revenue | 868 | 937 | ||||||
| Total revenue | 4,030 | 3,116 | ||||||
| Cost of revenue | 1,416 | 932 | ||||||
| Research and development costs | 1,563 | 818 | ||||||
| Sales and marketing expenses | 1,575 | 1,299 | ||||||
| General and administrative expenses | 1,657 | 1,276 | ||||||
| Operating loss | (2,181 | ) | (1,209 | ) | ||||
| Other expense: | ||||||||
| Other expense, net | (25 | ) | (4 | ) | ||||
| Interest expense, net | (332 | ) | (842 | ) | ||||
| Net loss | $ | (2,538 | ) | $ | (2,055 | ) | ||
| Net loss per share attributable to common stockholders: | ||||||||
| Basic and diluted | $ | (0.13 | ) | $ | (0.13 | ) | ||
| Weighted average shares outstanding: | ||||||||
| Basic and diluted | 18,852,828 | 15,438,276 |
CLEARPOINT NEURO, INC.
Consolidated Balance Sheets
(Dollars in thousands, except for per share data)
| March 31, 2021 (Unaudited) | December 31, 2020 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 64,858 | $ | 20,099 | ||||
| Accounts receivable, net | 2,004 | 1,881 | ||||||
| Inventory, net | 3,266 | 3,238 | ||||||
| Prepaid expenses and other current assets | 254 | 244 | ||||||
| Total current assets | 70,382 | 25,462 | ||||||
| Property and equipment, net | 292 | 319 | ||||||
| Operating lease rights of use | 2,613 | 2,736 | ||||||
| Software license inventory | 589 | 589 | ||||||
| Licensing rights | 331 | 353 | ||||||
| Other assets | 56 | 59 | ||||||
| Total assets | $ | 74,263 | $ | 29,518 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 727 | $ | 300 | ||||
| Accrued compensation | 990 | 1,595 | ||||||
| Other accrued liabilities | 473 | 349 | ||||||
| Operating lease liabilities, current portion | 430 | 394 | ||||||
| Deferred product and service revenue | 501 | 562 | ||||||
| Total current liabilities | 3,121 | 3,200 | ||||||
| Operating lease liabilities, net of current portion | 2,327 | 2,446 | ||||||
| Deferred product and service revenue, net of current portion | 318 | 215 | ||||||
| 2020 senior secured convertible notes payable, net | 24,515 | 21,280 | ||||||
| Total liabilities | 30,281 | 27,141 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, $0.01 par value; 25,000,000 shares authorized; none issued and outstanding at March 31, 2021 and December 31, 2020 | - | - | ||||||
| Common stock, $0.01 par value; 200,000,000 shares authorized; 20,678,280 shares issued and outstanding at March 31, 2021; and 17,047,584 issued and outstanding at December 31, 2020 | 207 | 170 | ||||||
| Additional paid-in capital | 165,835 | 121,729 | ||||||
| Accumulated deficit | (122,060 | ) | (119,522 | ) | ||||
| Total stockholders' equity | 43,982 | 2,377 | ||||||
| Total liabilities and stockholders' equity | $ | 74,263 | $ | 29,518 |
CLEARPOINT NEURO, INC.
Consolidated Statements of Cash Flows
(Dollars in thousands)
| For The Three Months Ended March 31, | ||||||||
| 2021 | 2020 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (2,538 | ) | $ | (2,055 | ) | ||
| Adjustments to reconcile net loss to net cash flows from operating activities: | ||||||||
| Depreciation and amortization | 15 | 58 | ||||||
| Share-based compensation | 320 | 228 | ||||||
| Payment-in-kind interest | 94 | - | ||||||
| Amortization of debt issuance costs and original issue discounts | 35 | 787 | ||||||
| Amortization of lease rights of use, net of accretion in lease liabilities | 133 | 25 | ||||||
| Increase (decrease) in cash resulting from changes in: | ||||||||
| Accounts receivable | (123 | ) | 105 | |||||
| Inventory, net | 47 | (365 | ) | |||||
| Prepaid expenses and other current assets | (10 | ) | 169 | |||||
| Other assets | 3 | 70 | ||||||
| Accounts payable and accrued expenses | (54 | ) | (161 | ) | ||||
| Accrued interest | - | (960 | ) | |||||
| Lease liabilities | (94 | ) | (23 | ) | ||||
| Deferred revenue | 41 | (209 | ) | |||||
| Net cash flows from operating activities | (2,131 | ) | (2,331 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (40 | ) | - | |||||
| Acquisition of licensing rights | - | (441 | ) | |||||
| Net cash flows from investing activities | (40 | ) | (441 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of 2020 senior secured convertible notes, net of financing costs and discount | - | 16,890 | ||||||
| Proceeds from public offering of common stock, net of offering costs | 46,785 | - | ||||||
| Proceeds from stock option and warrant exercises | 145 | - | ||||||
| Repayment of notes payable | - | (2,838 | ) | |||||
| Net cash flows from financing activities | 46,930 | 14,052 | ||||||
| Net change in cash and cash equivalents | 44,759 | 11,280 | ||||||
| Cash and cash equivalents, beginning of period | 20,099 | 5,696 | ||||||
| Cash and cash equivalents, end of period | $ | 64,858 | $ | 16,976 | ||||
| SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||
| Cash paid for: | ||||||||
| Income taxes | $ | - | $ | - | ||||
| Interest | $ | 214 | $ | 1,043 |