Full Press Release Details
Reports Third Quarter 2023 Financial and Operational Results
Q3 2023 Product sales grew 20% to $7.8M versus
$6.5M in Q3 2022. Q3 2023 Total revenue was approximately $8.8M. The pivotal STAR-T trial remains blinded with database lock nearing and
initial data analysis completion expected before year-end.
PRINCETON, N.J., November
9, 2023 - 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 September 30, 2023.
Third Quarter 2023 Financial Results
Recent Operating Highlights:
Dr. Phillip Chan, Chief Executive Officer of CytoSorbents
stated, "Our core business is built upon our E.U. approved flagship CytoSorb blood purification therapy, used in more than
221,000 human treatments with more than $205 million in sales to date, including $31.4 million in the last 12 months alone. CytoSorb addresses
multi-billion dollar markets in critical care and cardiac surgery in 75 countries worldwide by treating deadly inflammation and other
life-threatening conditions. These are common everyday ICU conditions like sepsis, trauma, burn injury, respiratory failure, liver failure,
and complications of surgery where mortality is high despite standard therapies. With the world struggling in the aftermath of the pandemic
with war, natural disasters, and illness, we believe our life-saving therapy has never been more relevant.
The DrugSorb -ATR anti-thrombotic removal
system is our other focus, having completed the U.S. and Canadian pivotal STAR-T (Safe and Timely Antithrombotic
Removal of Ticagrelor) randomized controlled trial that was designed to demonstrate a reduction in perioperative bleeding
in patients undergoing cardiothoracic surgery on Brilinta (ticagrelor, AstraZeneca). Brilinta is increasingly the "super-aspirin"
blood thinner of choice for patients suffering from a heart attack, or receiving a cardiac stent. Should the data, which currently remain
blinded, support U.S. FDA and Health Canada regulatory approval, it would open up an estimated $650 million dollar total addressable market
in these two countries alone, where we expect rapid adoption and strong user demand, reflecting our FDA Breakthrough Device designation.
We believe we have made excellent progress on
both of these programs so far this year and are specifically pleased to report 20% product sales growth in Q3 2023 versus a year ago,
and nearing database lock of the STAR-T trial and final data analysis before year-end.
Coronary artery bypass graft (CABG) surgery to
bypass blocked heart arteries is the most common type of open heart surgery performed in the United States and worldwide.
Approximately 300,000 CABG surgeries are performed each year in the U.S., often triggered by a heart attack, with the vast majority
operated on an urgent basis during the index hospitalization. An estimated 100,000 of these patients are at risk of excessive bleeding
due to blood thinners with approximately half of them on Brilinta . CytoSorb, which uses an equivalent polymer technology to DrugSorb -ATR,
is already approved and is increasingly used in the E.U. to remove Brilinta /Brilique and reduce bleeding risk in this indication.
The initial results from the International STAR Registry reporting on this real-world experience have shown favorably low rates
of serious perioperative bleeding.
As we noted in August, we completed the STAR-T
trial ahead of our own internal expectations with follow-up on 100% of the subjects, highlighting the excellent execution of the trial
by our 30 U.S. and Canadian trial centers, contract research organization (CRO), and our clinical team.
We reported earlier this year in June, that following
the second scheduled Data and Safety Monitoring Board (DSMB) data review of the first 80 patients enrolled in the pivotal STAR-T study,
no device-related safety issues were raised and that the DSMB recommended to complete the study without modification. The final DSMB review
on the full STAR-T trial will occur after database lock in the near future.
It is important to note the STAR-T study data
remains blinded to all parties and will not be unblinded until after database lock, when the final statistical analysis will occur. Because
of this, the results of the study are currently unknown.
We are working diligently to complete our initial
STAR-T data analysis before year-end. We intend to announce whether we believe the results from STAR-T can support an FDA marketing approval
application thereafter. With supportive results, our goal is to submit for U.S. FDA and Health Canada marketing approval in early-2024.
This process is currently being led in parallel to our clinical activities by our SVP of Global Regulatory, Dr. Irina Kulinets, who has
an extensive track record of U.S. and international regulatory success with the approval/clearance of medical products in numerous therapeutic
areas, including many Class II 510(k) and Class III Premarket Approval (PMA) medical devices. We believe our FDA Breakthrough Device Designation
for DrugSorb-ATR in this indication, which highlights the major unmet clinical need for which no approved or cleared alternatives exist
in the U.S., will help to expedite the regulatory review of our application. Although there can be no certainty, based on published FDA
review timelines, and dependent on the timing of regulatory filing and a favorable review of our data by FDA, we would anticipate potential
U.S. marketing approval of DrugSorb-ATR by late-2024 or early-2025.
Through many discussions with cardiothoracic surgeons
in the U.S., Canada, and abroad, we continue to confirm the vexing and serious clinical and economic problem that blood thinners cause
patients, surgeons, and hospitals.
Intraoperatively, the inability to
stop bleeding delays completion of the case and is very expensive. Shorter overall operative times have been cited in a previous
study when CytoSorb was used intraoperatively in patients undergoing cardiac surgery on Brilinta. Based on average published operating
room charges from the Cleveland Clinic hospital system, each additional 30 minute increment adds
more than $4,000 in cost to the operation.
Perioperatively, bleeding complications
are very expensive as well, due to the need for blood transfusions, reoperations, and longer ICU and hospitals stays. Recently, in
a study published in the American Journal of Cardiovascular Drugs, Cohen et al. modeled the projected cost savings of less perioperative
bleeding that DrugSorb-ATR could provide in the U.S. in patients undergoing surgery before completing washout of Brilinta -
a similar cohort being evaluated in the STAR-T trial. Using assumptions based on published studies, they found the use of DrugSorb-ATR
in these cases had a cost-dominant value proposition based on delivering improved clinical outcomes for patients and substantial cost
savings (inclusive of the cost of the device) to the hospital. Finally, outcomes in CABG surgery, the most common cardiothoracic surgical
procedure in the United States, such as death rates, readmissions, and postoperative hemorrhage (classified as a Serious Complication)
reflect heavily in the Hospital's Quality Star Rating patient safety rating, as defined by the U.S. Centers of Medicare
& Medicaid Services (CMS). The hospital's overall Star rating is critical as it helps to differentiate the hospital on objective
quality measures from others in the area, important in driving patient traffic and procedure revenue to the hospital, and with direct
implications on overall profitability.
Because of this, we believe DrugSorb-ATR could
represent a "win-win-win" for patients, surgeons and hospital administrators by potentially allowing safe and timely surgery
by actively removing the drug from the bloodstream, while reducing the serious bleeding risk and unnecessary costs in such patients. With
the appropriate approvals, we intend to commercialize CytoSorb in the U.S. and Canada primarily with a direct sales force focused regionally
at high volume cardiac surgery centers, including our clinical trial centers, and supplemented with cardiac surgery-focused distributors
or strategic partners.
We have extensive experience in manufacturing
and commercialization of our products abroad. Under the leadership of our President and Chief Operating Officer, Vincent Capponi, our
Chief Medical Officer, Dr. Efthymios Deliargyris, and Vice President of U.S. Sales and Marketing, James Komsa, who led the Northeast Cardiac
and Vascular Group (CVG) at Medtronic that generated $310 million in annual sales at Medtronic, our goal is to drive rapid awareness,
adoption, reimbursement, and sales of DrugSorb-ATR in the U.S. and Canada. We believe product gross margins of DrugSorb-ATR will exceed
90% and based on revenue and operating expense projections, we expect the U.S. operations to achieve breakeven in the first year of commercialization.
Based on the above, we eagerly await the results
of the STAR-T trial, and the potential future initiation of the STAR-D trial for the removal of the leading blood thinners, Xarelto
(Bayer, Janssen) and Eliquis (Pfizer, BMS), with the ultimate goal of establishing DrugSorb -ATR as the one-stop shop for blood
thinner removal, not just in cardiac surgery, but hospital-wide.
In the third quarter of 2023, we achieved 20%
growth in product sales year-over-year in what is typically a highly seasonal quarter where most European businesses slow due to the summer
holidays. Quarterly core (non-COVID-19 related) sales grew for the third straight period year-over-year, with trailing 12-month product
sales of approximately $31.4 million. Trailing 12-month total revenue was $37.1 million, which includes product sales and grant income.
Product gross margins were 72%, a significant improvement from the 55% reported a year ago, despite some continued manufacturing inefficiencies
including overtime shifts to increase CytoSorb inventory levels. In the near term, we expect product gross margins to be more consistently
in the range of 75-80%.
From 2017-2021, our compounded annual growth rate
(CAGR) for core (non-COVID-19) sales was 26%. Following the post-COVID-19 hangover in 2022 and a year of recovery in 2023, we believe