Full Press Release Details
Reports Second Quarter 2020 Results
Reaches $2.5 million Amid COVID-19 Pandemic
IRVINE, CA, August 12,
2020 - ClearPoint Neuro, Inc. (Nasdaq: CLPT) today announced financial results for its second fiscal quarter and six months
ended June 30, 2020.
- Three Months Ended June 30, 2020
Total revenues for the
quarter were approximately $2.5 million and $2.6 million for the three months ended June 30, 2020 and 2019, respectively, a decrease
Functional neurosurgery
revenue, which consists of disposable product commercial sales related to cases utilizing the ClearPoint system, decreased 38%
to $1.0 million for the three months ended June 30, 2020, from $1.7 million for the same period in 2019. This decrease was due
to the effects of the COVID-19 pandemic, in which elective surgical procedures, historically representing more than 80% of the
Company's ClearPoint system case volume, were temporarily suspended commencing in the second half of March 2020 and which
have not yet returned to pre-pandemic levels.
Biologics and drug delivery
revenues, which include sales of disposable products and services related to customer-sponsored clinical trials utilizing the
ClearPoint system, increased 183% to $1.2 million for the three months ended June 30, 2020, from $413,000 for the same period
in 2019. This increase in biologics and drug delivery service revenues is attributable to the establishment of additional relationships
with biologic and drug delivery companies that included period-based retainers for clinical services in support of such companies'
respective clinical trials.
Capital equipment revenue, consisting of sales of ClearPoint reusable hardware
and software, as well as service contracts related to capital equipment, decreased 51% to $240,000 for the three months ended June
30, 2020, from $485,000 for the same period in 2019. While revenues from this product line historically have varied from quarter
to quarter, the Company believes that many hospitals have postponed capital equipment acquisition activities, which continued postponement
the Company believes will be contingent upon the prevalence and duration of the COVID-19 pandemic.
margin for the three months ended June 30, 2020 was 74%, as compared to 60% for the same period in 2019. This increase was driven
primarily by the greater contribution of services to total revenue during the three months ended June 30, 2020, as compared to
the same period in 2019.
Operating expenses for
the three months ended June 30, 2020 were $3.3 million, a 15% increase from operating expenses of $2.9 million for the same period
in 2019. This increase was comprised of: (a) research and development costs, which increased 18% resulting primarily from increases
in personnel costs; and (b) general and administrative expenses, which increased 33% resulting primarily from an increase in professional
fees and a decrease in the allocation of shared departmental resources to production due to reduced manufacturing activity during
the 2020 second quarter. These increases were partially offset by a decrease of 2% in sales and marketing expenses, resulting
primarily from a decrease in items attributable to the effects of the COVID-19 pandemic, such as incentive-based compensation
and travel, which was partially offset by headcount increases in the Company's clinical and marketing teams.
Operating loss for the
three months ended June 30, 2020 was $1.5 million, as compared with $1.3 million for the same period in 2019.
Cash and cash equivalent
balances at June 30, 2020 were $16.0 million.
"The second quarter of 2020 was significantly affected by the COVID-19
pandemic, which adversely impacted sales across all of our business lines," commented Joe Burnett, President and Chief Executive
Officer of ClearPoint Neuro. "More than 80% of our procedures are deemed elective,' which generally resulted
in the postponement or cancellation of such procedures to give our hospital customers the capacity for treating critical COVID-19
patients, which resulted in the completion of only 11 ClearPoint cases in April. As elective procedures resumed in certain cities,
May case volume increased to 44 cases and June volume followed at 71 cases, representing approximately 90% of our pre-pandemic
volume. Similarly, new capital placements and evaluations were effectively put on hold in the 2020 second quarter as hospitals
dealt with the influx of COVID-19 patients. This said, I am immeasurably proud of our clinical support team who stood shoulder-to-shoulder
with our hospital customers and ensured that cases in which the use of our ClearPoint System was integral in patient treatment
were supported during the pandemic.
note, our biologics and drug delivery business increased 183% to $1.2 million, which we believe demonstrates that our strategy
in this space continues to drive new business and to provide diversification in our revenue stream. While our customer-sponsored
clinical trials cases were postponed as a result of the pandemic, our pre-clinical planning and clinical services continued to
progress where possible."
of the pandemic continues to result in uncertainty as to the timing of the resumption to pre-pandemic levels of elective procedures,
capital placements and customer-sponsored clinical trials. Accordingly, we are not yet providing a forecast for the balance of
2020. While we do not expect elective procedures to decline to the level seen in April, we anticipate, and have observed, that
hospitals in cities struggling with COVID-19 cases will suspend elective procedures to ensure ventilator access and bed capacity.
Furthermore, it should be noted that patients flow through a diagnostic and treatment process before they are referred to surgery.
Accordingly, it follows that diagnostic work-ups delayed in March and April will cause the resulting surgeries to be similarly
the current situation as a temporary setback, our team continues to work tirelessly to execute on our four-pillar growth strategy,
staying true to our course."
Investors and analysts
are invited to listen to a live broadcast review of the Company's 2020 second quarter and six months financial results today at
4:30 p.m. Eastern time (1:30 p.m. Pacific time) that may be accessed 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. or Canada.
For those who cannot
access the live broadcast, a replay will be available shortly after the completion of the call until August 26, 2020 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.
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 60 active clinical sites in the United States.
The Company's SmartFlow cannula is being used in partnership or evaluation with more than 20 individual
biologics and drug delivery companies in various stages from preclinical research to late stage regulatory trials. To date, more
than 3,500 cases have been performed and supported by the Company's field-based clinical specialist team which offers support
and services for our 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 COVID-19 and the measures adopted to contain
its spread; future revenues from sales of the Company's ClearPoint Neuro Navigation System products; the Company's
ability to market, commercialize and achieve broader market acceptance for the Company's ClearPoint Neuro Navigation System
products; and estimates regarding the sufficiency of the Company's cash resources. 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, 2019, and the Company's Quarterly Report
on Form 10-Q for the three months ended March 31, 2020, both of which have been filed with the Securities and Exchange Commission,
and the Company's Quarterly Report on Form 10-Q for the three months ended June 30, 2020, which the Company intends to file
with the Securities and Exchange Commission on or before August 14, 2020.
Harold A. Hurwitz, Chief Financial Officer
Jacqueline Keller, Vice President, Marketing