Full Press Release Details
Reports Second Quarter 2024 Financial Results
call will be held today, Friday, August 9 at 9:00 am ET
Ind., August 9, 2024 (GLOBE NEWSWIRE)-NeurAxis, Inc. ("NeurAxis," or the "Company")
(NYSE American: NRXS), a medical technology company commercializing neuromodulation therapies for chronic and debilitating conditions
in children and adults, today announced results for the second quarter period ended June 30, 2024.
Operational Highlights
| BCBS licensee in Florida covering over 6 million lives. | ||
| BCBS licensee in North Dakota covering over 310,000 people. | ||
| BCBS plan in the mid-Atlantic region, providing coverage for approximately 7 million covered lives. | ||
| Medical Policy with a BCBS licensee covering approximately 1 million covered lives | ||
| BCBS plan in the mid-Atlantic with approximately 3.5 million covered lives. |
| One of the nation's largest not for profit health plans, serving over 12 million members, has committed to provide formal coverage beginning October 1 st , 2024. Once this policy is in the public domain, the covered lives will be over 35 million. | |
| Submitted to the FDA its innovative rectal expulsion device (RED) product, which was licensed from the University of Michigan. RED's innovative design simplifies anorectal function testing and can be used without interrupting clinical workflow. FDA clearance is expected in the fourth quarter of 2024. | |
| Announced a submission to the FDA for the expansion of IB-Stim label to allow for a larger patient population beyond the current 11-18 years of age to 8-21 years. | |
| The Company remains committed to clinical research in the pediatric space, with 16 peer-reviewed publications. All studies were carried out in US children's hospitals using NeurAxis' PENFS technology. This level of evidence puts NeurAxis in a great position to continue expanding payor coverage and increasing adoption of the technology. |
| Announced the results of the largest multicenter, prospective registry in pediatric DGBIs. It evaluated outcomes of pediatric patients (8-18 years) following a 4-week course of IB-Stim in a real-world clinical setting. Seven large tertiary care centers enrolled patients with pain-associated DGBIs. Patients were asked to fill out validated pediatric questionnaires, including the abdominal pain index (API). Data was collected weekly during therapy and then every 3 months up to 1 year. Compared to baseline scores, there were significant improvements in abdominal pain (API) after 4 weeks of IB-Stim treatment at every time point, including 6 months (p<0.001) and 12 months (p<0.001). | |
| Announced the results of a retrospective study led by the Cincinnati Children's Hospital Medical Center comparing and reviewing the records of 101 adolescent patients with DGBIs treated with IB-Stim therapy or standard-of-care medications, amitriptyline (tricyclic antidepressant) or cyproheptadine (antihistamine). The comparative analysis noted: |
| At follow-up, IB-Stim therapy showed improvements in abdominal pain (p=0.001) and functional disability (p=0.048) compared to baseline, while amitriptyline showed improvements in abdominal pain (p=0.034). | ||
| In a comparison of outcomes between groups, IB-Stim was more effective than cyproheptadine in improving abdominal pain (p=0.04) and did not differ from amitriptyline (p=0.64). Nausea scores did not differ between groups (p>0.05); and | ||
| Disability scores between groups were only more effective for amitriptyline vs. cyproheptadine (p=0.03). Disability scores did not differ from amitriptyline compared with IB-Stim (p=0.21). |
Carrico, Chief Executive Officer of NeurAxis, commented, "We are excited about another strong quarter of continued execution, bringing
us much closer to having the complete foundation in place to scale revenues. Our commercialization strategy for IB-Stim ,
based on strong data publication leading to insurance coverage, is beginning to bear fruit. We now have 22.5 million lives under insurance
coverage with many pending decisions, a significant increase from 4.5 million a year ago. While revenues in 2Q24 declined 5.3% on a year-over-year
basis, this is a significant improvement compared to year-over-year declines of 19.7% and 13.3% in 1Q24 and 4Q23, respectively. Most
importantly, the revenue we lost in the previous quarters is not due to lost accounts but rather accounts receiving "no-authorization
required" responses from payers, which means the claim will likely not be paid. These accounts are set up and ready to begin treating
again once the larger payers have a policy in place. The fact that we are alleviating the losses without these accounts shows we are
adding accounts, and current accounts are treating more and more children as their insurance coverage increases. The demand for our product
is at record levels and continues to increase. In the second half of 2024, we expect to roughly double our lives under insurance coverage
to 50 million, setting the stage for growth acceleration in late 2024 and into 2025. In recent weeks, we
received a commitment from our largest payer to date with over 12 million covered lives, with launch expected on October 1st."
contributing to our growth acceleration in 2H24 will be the commercialization of RED, our licensed innovative rectal expulsion device,
a self-inflating balloon expulsion test that allows for point-of-care testing to effectively identify patients with an evacuation disorder,
such as pelvic floor dysfunction. We have made the submission to the FDA and expect the device to receive FDA clearance late in the fourth
quarter of 2024" Mr. Carrico continued.
Carrico concluded, "We remain committed to further commercializing our lead pediatric indication for functional abdominal pain
associated with IBS in children. We have recently made an FDA submission to expand our label beyond the current 11-18 year old patient
population to the 8-21 year old patient population and four devices. In addition, we are advancing our development pipeline for a number
of new indications leveraging our unique neuromodulation
therapy, including Functional Dyspepsia, Cyclic Vomiting Syndrome, and more. As a result of recent financings with long-term investors
in the healthcare space, our balance sheet is well positioned to execute our
business plans for the foreseeable future."
Quarter 2024 Financial Results
in the second quarter of 2024 were $611.5 thousand, down 5.3% compared to $646.0 thousand in the second quarter of 2023. The decrease
was primarily due to fewer shipments to certain customers as they manage through the insurance reimbursement process, partially offset
by an increase in volume to our patient assistance customers that receive devices at a discount. While we have made great strides in
recent months in gaining coverage, a lag exists between insurance coverage and order placement due to billing and coding implementation
processes unique to each of our customers. Given our recent success with new payor coverage, we expect our revenue to increase in late
profit in the second quarter of 2024 was $538.0 thousand, a 6.9% decrease compared to $578.2 thousand in the second quarter of 2023 due
to the lower sales volume. The decline in gross margin to 88.0% in the second quarter of 2024 from 89.5% in the second quarter of 2023
was due to growth in deliveries from our financial assistance programs that are discounted to patients without insurance coverage.
loss in the second quarter of 2024 was $2.2 million, an increase of 97.5% compared to $1.1 million in the second quarter of 2023. The
increase was primarily due to (i) lower sales volume, (ii) the build out of the market access and sales teams, (iii) recurring costs
of becoming a publicly-held company including legal, insurance, investors relations, exchange listing and board fees, (iv) advertising
costs in order to expand market access, (v) expenses related to the introduction of an annual short-term incentive bonus program (vi)
$435 thousand of non-recurring severance and consulting costs, partly offset by lower selling and research and development expenses.
net loss in the second quarter of 2024 was $2.9 million, an increase of 30.5% compared to $2.2 million in the second quarter of 2023.
The increase was primarily due to (i) higher general and administrative costs and (ii) the non-cash settlement of certain pre-IPO Series
A Preferred Stock shareholder claims, partly offset by the elimination of debt discount, issuance costs, debt extinguishment and derivative
fair valuation charges.
on hand as of June 30, 2024 was $1.8 million as compared to $51.4 thousand as of June 30, 2023. Although the Company had no long-term
debt as of June 30, 2024, short-term debt, net of deferred financing fees, totaled $4.8 million due to proceeds received from the issuance
of notes payable during the six months ended June 30, 2024.
and Time: Friday, August 9, 2024, at 9:00am ET
Webcast Information: Interested parties can access the conference call via a live webcast, which is available in the Investor Relations
section of the Company's website at https://ir.neuraxis.com/ or https://edge.media-server.com/mmc/p/bettcvsw. For
participants listening through the webcast, questions can be sent in through the portal using the "Ask a Question" link or
by emailing questions to NRXS@lythampartners.com.
Information: Interested parties can also access the live conference call by initially registering at the following link. Upon completion
of the registration link, call-in participants will receive the dial-in info and a unique PIN to join the call as well as an email
confirmation with the details.
A webcast replay will be available in the Investor Relations section of the Company's website at https://edge.media-server.com/mmc/p/bettcvsw
Inc., is a medical technology company focused on neuromodulation therapies to address chronic and debilitating conditions in children
and adults. NeurAxis is dedicated to advancing science and leveraging evidence-based medicine to drive adoption of its IB-Stim
therapy, which is its proprietary Percutaneous Electrical Nerve Field Stimulation (PENFS) technology, by the medical, scientific, and
patient communities. IB-Stim is FDA cleared for functional abdominal pain associated with irritable bowel syndrome (IBS) in adolescents
11-18 years old. Additional clinical trials of PENFS in multiple pediatric and adult conditions with large unmet healthcare needs are
underway. For more information, please visit http://neuraxis.com.
statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking
statements. Forward-looking statements which include, but are not limited to, statements regarding FDA clearance in the fourth quarter
of 2024, the timing of the receipt of financing proceeds, revenue growth, and wider insurance acceptance of our products are based on
management's current assumptions and expectations of future events and trends, which affect or may affect the Company's business,
strategy, operations or financial performance, and actual results and other events may differ materially from those expressed or implied
in such statements due to numerous risks and uncertainties. Forward-looking statements are inherently subject to risks and uncertainties,
some of which cannot be predicted or quantified. There are a number of important factors that could cause actual results, developments,
business decisions or other events to differ materially from those contemplated by the forward-looking statements in this press release.
These factors include, but are not limited to,, the conditions in the U.S. and global economy, the trading price and volatility of the
Company's stock, public health issues or other events, the Company's compliance with applicable laws, the results of the
Company's clinical trials and perceptions thereof, the results of submissions to the FDA, the timing of decisions by insurance
companies to provide coverage of our products, the results of the shareholder vote to enable the issuance of the Preferred Stock, and
factors described in the Risk Factors section of NeurAxis's public filings with the Securities and Exchange Commission (SEC). Because
forward-looking statements are inherently subject to risks and uncertainties, you should not rely on these forward-looking statements
as predictions of future events. These forward-looking statements speak only as of the date of this press release and, except to the
extent required by applicable law, the Company undertakes no obligation to update or revise these statements, whether as a result of
any new information, future events and developments or otherwise.
page discusses research activities with percutaneous electrical nerve field stimulator (PENFS) technology. Please note, the research
being described includes information about technology and intended uses of that technology which have not been reviewed or approved/cleared
by the U.S. FDA, and is being provided for informational purposes only. NeurAxis does not recommend or suggest the use of its PENFS
IB-Stim device for uses beyond those that are cleared by the U.S. FDA. See https://ibstim.com/important-information/.
Statements of Operations (Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net sales | $ | 611,500 | $ | 646,021 | $ | 1,258,135 | $ | 1,451,131 | ||||||||
| Cost of goods sold | 73,458 | 67,813 | 148,539 | 163,713 | ||||||||||||
| Gross profit | 538,042 | 578,208 | 1,109,596 | 1,287,418 | ||||||||||||
| Selling expenses | 62,274 | 78,791 | 142,304 | 186,723 | ||||||||||||
| Research and development | 54,312 | 109,789 | 59,882 | 126,586 | ||||||||||||
| General and administrative | 2,628,288 | 1,507,169 | 4,946,362 | 2,987,923 | ||||||||||||
| Operating loss | (2,206,832 | ) | (1,117,541 | ) | (4,038,952 | ) | (2,013,814 | ) | ||||||||
| Other (expense) income: | ||||||||||||||||
| Financing charges | - | - | (230,824 | ) | (2,772 | ) | ||||||||||
| Interest expense | (80,697 | ) | (194,690 | ) | (107,257 | ) | (356,378 | ) | ||||||||
| Change in fair value of warrant liability | 7,576 | (36,050 | ) | (1,708 | ) | 198,757 | ||||||||||
| Change in fair value of derivative financial instruments | - | 860 | - | 192,157 | ||||||||||||
| Amortization of debt discount and issuance costs | (63,817 | ) | (887,937 | ) | (85,500 | ) | (3,550,592 | ) | ||||||||
| Extinguishment of debt liabilities | - | - | - | 1,129,498 | ||||||||||||
| Other income | 2,961 | 2 | 2,961 | 1,552 | ||||||||||||
| Other expense | (576,901 | ) | (258 | ) | (577,081 | ) | (7,430 | ) | ||||||||
| Total other (expense) income, net | (710,878 | ) | (1,118,073 | ) | (999,409 | ) | (2,395,208 | ) | ||||||||
| Net loss | $ | (2,917,710 | ) | $ | (2,235,614 | ) | $ | (5,038,361 | ) | $ | (4,409,022 | ) |