Full Press Release Details
Medical Reports Fourth Quarter and Full Year 2024 Financial Results
Company Provides Corporate Update that Includes Information on its
Progress Enrolling Subjects in its Pivotal Clinical Study for Breakthrough Device, the Fully Implanted Acclaim Cochlear Implant
WHITE BEAR LAKE, Minn., March 31, 2025 (Newsfile Corp.) -- Envoy
Medical , Inc. ("Envoy Medical") (Nasdaq: COCH), a revolutionary hearing health company focused on fully implanted
hearing devices, today announced its corporate and financial results for the fourth quarter and full year ended December 31, 2024,
as well as other subsequent events.
Brent Lucas, CEO of Envoy Medical commented: "Envoy Medical had
a successful 2024 and we are off to a wonderful start in 2025. Obtaining FDA's approval to begin our pivotal clinical trial for
the fully implanted Acclaim cochlear implant was a milestone many years in the making, and we are very excited to report that enrollment
is going extremely well. The investigational sites are reporting a tremendous amount of patient interest in our fully implanted cochlear
implant. We believe we have a special product and a great opportunity to change the hearing implant industry. We are also pleased with
the progress surrounding the Hearing Device Coverage Clarification Act, which, if passed, could provide our Esteem implant
with a pathway to Medicare coverage. In addition, the establishment of new CPT codes for fully implanted active middle ear implants, which
become effective in July of this year, furthered our efforts in the quest for the Esteem implant to become a reimbursed product."
Financial and Corporate Highlights for 2024 and to date:
Financial Results from YE 2024
Net revenues decreased $91 thousand for the year ended December 31,
2024, compared to the year ended December 31, 2023, primarily due to the decrease in the number of battery replacement sales due
to supply chain limitations. Cost of goods sold decreased $47 thousand for the same period and is aligned with the decrease in revenue
resulting from the reduced number of Battery replacement sales.
R&D expenses increased $1.2 million for the year ended December 31,
2024 compared to the year ended December 31, 2023. The increase is primarily due to an increase in headcount and contractors in our
engineering and clinical departments for December 31, 2024, as we increased headcount in preparation for our pivotal clinical study for
the Acclaim CI. These increases in headcount included the addition of five new engineers, a clinical research associate, and a clinical
Sales and marketing expenses increased $68 thousand for the year ended
December 31, 2024 compared to the year ended December 31, 2023. The increase is primarily due to increased legal and professional
fees to secure insurance reimbursement for the Esteem FI-AMEI product, partially offset by a reduction in headcount.
General and administrative expenses decreased $438 thousand for the
year ended December 31, 2024 compared to the year ended December 31, 2023. The decrease is primarily due to reduced professional
service costs in 2024 compared to 2023 related to the Business Combination transaction occurring in September 2023.
As of December 31, 2024 cash and cash equivalents were approximately
About the Fully Implanted Acclaim
We believe the fully implanted Acclaim Cochlear
Implant ("Acclaim CI") is a first-of-its-kind hearing device. Envoy Medical's fully implanted technology includes a
sensor designed to leverage the natural anatomy of the ear instead of a microphone to capture sound.
The Acclaim CI is designed to address severe
to profound sensorineural hearing loss that is not adequately addressed by hearing aids. The Acclaim CI is expected to be indicated for
adults who have been deemed adequate candidates by a qualified physician.
The Acclaim Cochlear Implant received the
Breakthrough Device Designation from the U.S. Food and Drug Administration (FDA) in 2019.
CAUTION The fully implanted Acclaim Cochlear Implant is an investigational
device. Limited by Federal (or United States) law to investigational use.
About the Esteem Fully Implanted Active
Middle Ear Implant (FI-AMEI)
The Esteem fully implanted active middle ear
implant (FI-AMEI) is the only FDA-approved, fully implanted* hearing device for adults diagnosed with moderate to severe sensorineural
hearing loss allowing for 24/7 hearing capability using the ear's natural anatomy. The Esteem FI-AMEI hearing implant is invisible
and requires no externally worn components and nothing is placed in the ear canal for it to function. Unlike hearing aids, you never put
it on or take it off. You can't lose it. You don't clean it. The Esteem FI-AMEI hearing implant offers true 24/7 hearing.
Important safety information for the Esteem
FI-AMEI can be found at: https://www.envoymedical.com/safety-information.
Additional Information and Where to Find
Copies of the documents filed by Envoy Medical
with the SEC may be obtained free of charge at the SEC's website at www.sec.gov.
Forward-Looking Statements
This press release includes "forward-looking
statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform
Act of 1995. Forward-Looking statements may be identified by the use of words such as "estimate," "plan," "project,"
"forecast," "intend," "will," "expect," "anticipate," "believe,"
"seek," "target" or other similar expressions that predict or indicate future events or trends or that are not
statements of historical matters, but the absence of these words does not mean that a statement is not forward-looking. Such statements
may include, but are not limited to, statements regarding the expectations of Envoy Medical concerning the outlook for its business, productivity,
plans and goals for future operational improvements and capital investments; the timing and results of IRB approvals, site documents,
logistics or activations, enrollments, and clinical trials of the Acclaim CI, and the participation or any changes in participation of
any institution or healthcare professionals in such trials; the Acclaim CI being the first to market fully implanted cochlear implant;
the safety, performance, and market acceptance of the Acclaim CI; and any information concerning possible or assumed future operations
of Envoy Medical. The forward-looking statements contained in this press release reflect Envoy Medical's current views about future
events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause its
actual results to differ significantly from those expressed in any forward-looking statement. Envoy Medical does not guarantee that the
events described will happen as described (or that they will happen at all). These forward-looking statements are subject to a number
of risks and uncertainties, including, but not limited to changes in the market price of shares of Envoy Medical's Class A Common
Stock; changes in or removal of Envoy Medical's shares inclusion in any index; Envoy
Medical's success in retaining or recruiting, or changes required in, its officers, key employees or directors; unpredictability
in the medical device industry, the regulatory process to approve medical devices, and the clinical development process of Envoy Medical
products; competition in the medical device industry, and the failure to introduce new products and services in a timely manner or at
competitive prices to compete successfully against competitors; disruptions in relationships with Envoy Medical's suppliers, or
disruptions in Envoy Medical's own production capabilities for some of the key components and materials of its products; changes
in the need for capital and the availability of financing and capital to fund these needs; changes in interest rates or rates of inflation;
legal, regulatory and other proceedings could be costly and time-consuming to defend; changes in applicable laws or regulations, or the
application thereof on Envoy Medical; a loss of any of Envoy Medical's key intellectual property rights or failure to adequately
protect intellectual property rights; the effects of catastrophic events, including war, terrorism and other international conflicts;
and other risks and uncertainties set forth in the section entitled "Risk Factors" and "Cautionary Note Regarding Forward
Looking Statements" in the Annual Report on Form 10-K filed by Envoy Medical on March 28, 2025, and in other reports Envoy
Medical files, with the SEC. If any of these risks materialize or Envoy Medical's assumptions prove incorrect, actual results could
differ materially from the results implied by these forward-looking statements. While forward-looking statements reflect Envoy Medical's
good faith beliefs, they are not guarantees of future performance. Envoy Medical disclaims any obligation to publicly update or revise
any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events
or other changes after the date of this press release, except as required by applicable law. You should not place undue reliance on any
forward-looking statements, which are based only on information currently available to Envoy Medical.
Envoy Medical Investor
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
| December 31, 2024 | December 31, 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | 5,483 | $ | 4,218 | ||||
| Accounts receivable, net | 38 | 70 | ||||||
| Other receivable | 780 | 176 | ||||||
| Inventories | 1,708 | 1,404 | ||||||
| Prepaid expenses and other current assets | 1,375 | 1,588 | ||||||
| Total current assets | 9,384 | 7,456 | ||||||
| Property and equipment, net | 1,275 | 351 | ||||||
| Operating lease right-of-use asset (related party) | 879 | 464 | ||||||
| Total assets | $ | 11,538 | $ | 8,271 | ||||
| Liabilities and stockholders' deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,652 | $ | 1,554 | ||||
| Accrued expenses | 4,416 | 4,613 | ||||||
| Other current liabilities | 573 | 645 | ||||||
| Forward purchase agreement warrant liability | 472 | 4 | ||||||
| Product warranty liability, current portion | 282 | 311 | ||||||
| Operating lease liability, current portion (related party) | 143 | 158 | ||||||
| Total current liabilities | 7,538 | 7,285 | ||||||
| Term loans payable (related party) | 18,716 | - | ||||||
| Product warranty liability, net of current portion | 1,771 | 1,923 | ||||||
| Operating lease liability, net of current portion (related party) | 802 | 404 | ||||||
| Publicly traded warrant liability | 662 | 332 | ||||||
| Forward purchase agreement put option liability | - | 103 | ||||||
| Other liability | 891 | - | ||||||
| Total liabilities | 30,380 | 10,047 | ||||||
| Commitments and contingencies (see Note 16) | ||||||||
| Stockholders' deficit: | ||||||||
| Series A Preferred Stock, $0.0001 par value; 100,000,000 shares authorized and 10,000,000 shares designated as of December 31, 2024 and 2023; 4,126,667 and 4,500,000 shares issued and outstanding as of December 31, 2024 and 2023, respectively | - | - | ||||||
| Class A Common Stock, $0.0001 par value; 400,000,000 shares authorized as of December 31, 2024 and 2023; 21,326,609 and 18,599,982 shares issued and outstanding as of December 31, 2024 and 2023, respectively | 2 | 2 | ||||||
| Additional paid-in capital | 266,013 | 255,596 | ||||||
| Accumulated deficit | (284,734 | ) | (257,256 | ) | ||||
| Accumulated other comprehensive loss | (123 | ) | (118 | ) | ||||
| Total stockholders' deficit | (18,842 | ) | (1,776 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 11,538 | $ | 8,271 |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
(In thousands, except share and per share amounts)
| Year Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Net revenues | $ | 225 | $ | 316 | ||||
| Costs and operating expenses: | ||||||||
| Cost of goods sold | 742 | 789 | ||||||
| Research and development | 10,179 | 8,956 | ||||||
| Sales and marketing | 1,734 | 1,666 | ||||||
| General and administrative | 6,826 | 7,264 | ||||||
| Total costs and operating expenses | 19,481 | 18,675 | ||||||
| Operating loss | (19,256 | ) | (18,359 | ) | ||||
| Other income (expense): | ||||||||
| Change in fair value of convertible notes payable (related party) | - | (13,332 | ) | |||||
| Change in fair value of forward purchase agreement put option liability | 103 | (69 | ) | |||||
| Change in fair value of forward purchase agreement warrant liability | 411 | 842 | ||||||
| Change in fair value of forward purchase agreement warrant liability due to modification | (881 | ) | - | |||||
| Change in fair value of publicly traded warrant liability | (330 | ) | 942 | |||||
| Interest expense, related party | (816 | ) | - | |||||
| Other (expense) income | (26 | ) | 54 | |||||
| Total other expense, net | (1,539 | ) | (11,563 | ) | ||||
| Net loss | (20,795 | ) | (29,922 | ) | ||||
| Induced conversion of Series A Preferred Stock into Class A Common Stock | (1,162 | ) | - | |||||
| Deemed dividend on waiver of restriction on Class A Common Stock | (495 | ) | - | |||||
| Cumulative preferred dividends | (5,521 | ) | (1,349 | ) | ||||
| Net loss attributable to common stockholders, basic and diluted | $ | (27,973 | ) | $ | (31,271 | ) | ||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (1.49 | ) | $ | (2.54 | ) | ||
| Weighted-average Class A Common Stock outstanding, basic and diluted | 18,790,448 | 12,295,391 | ||||||
| Other comprehensive loss: | ||||||||
| Foreign currency translation adjustment | (5 | ) | (3 | ) | ||||
| Other comprehensive loss | (5 | ) | (3 | ) | ||||
| Comprehensive loss | $ | (20,800 | ) | $ | (29,925 | ) |
CONSOLIDATED STATEMENTS OF CASH FLOWS