Full Press Release Details
Announces Fourth Quarter and Year-End 2020 Financial Results
to host investor conference call today, March 9, at 8:30am ET
Aviv, Israel- March 9, 2021 - InspireMD, Inc. (NYSE American: NSPR), developer of the CGuard Embolic Prevention
System (EPS) for the prevention of stroke caused by the treatment of Carotid Artery Disease (CAD), today announced financial and
operating results for the fourth quarter and year ended December 31, 2020.
Quarter 2020 and recent highlights:
| Announced the closing of an upsized underwritten public offering of $20.7 million. | ||
| Announced the addition of renowned interventional cardiologist Gary Roubin, M.D., Ph.D., to the Board of Directors. | ||
| Announced the appointment of leading interventional cardiologist Chris Metzger, M.D., system chair of clinical research at Ballad Health System in Eastern Tennessee as the principal investigator for its planned FDA registration trial for CGuard EPS. | ||
| Secured China-based investment partner for process of seeking regulatory approval and distribution of CGuard EPS in mainland China. | ||
| Announced the engagement of Hart Clinical Consultants (HCC), a leading Contract Research Organization (CRO) to conduct the clinical trial of CGuard Carotid Stent System in the United States. | ||
| Conducted multiple presentations regarding CGuard EPS, including a live demonstration, during the Leipzig Interventional Congress. | ||
| Shipments for the quarter were $738,000 |
was a very remarkable, albeit challenging year for us - and the global community - and we achieved many important
milestones toward our goal of changing the standard of care for the prevention of stroke
caused by carotid artery disease," said Marvin Slosman, CEO of InspireMD. "Our team's performance during the
COVID-19 pandemic has remained steadfast, focused on execution, financial stability and commercial growth. This included maintaining
our global presence with CGuard during this most challenging time when elective procedures were impacted. While the market curtailed
our ability to grow revenue, and we took an accounting adjustment to Q4 revenue for a one time historical event from 2014, we
remained focus on building our business by investing heavily in our strategic plans, human capital, infrastructure, new market
and product development opportunities, all to create more rapid growth potential as the impact from COVID normalizes. We view
2020 revenue as an unanticipated exception to what otherwise could have been a promising year of growth. As we enter 2021 with
more optimism, we reflect on the many foundational achievements 2020 brought to our business.
significantly, in 2020 we received approval of our Investigational Device Exemption (IDE) application to initiate a pivotal study
of CGuard EPS (C-Guardian) in the United States by the FDA. This triggered a number of critical additions to our team,
including renowned interventional cardiologist
Gary Roubin, M.D., Ph.D. to our Board of Directors, Dr. Chris Metzger to lead the investigators,
a world-class contract research organization (HCC), as well as Christina Brennan, M.D., to assist with trial execution. The culmination
of this good work resulted in an oversubscribed public offering which raised proceeds of $20.7M, providing the financial support
needed to complete the effort. We are diligently preparing for initiation of the trial.
terms of our global strategy, in 2020 we continued to expand our market presence, including by obtaining registration and distribution
for CGuard in Brazil, the largest market for medical devices in Latin America. The Brazilian clearance supports our goals to expand
in other Latin and South American markets. We also completed an investment and distribution agreement as part of our strategy
to enter mainland China, believed to be the second fastest growing market for peripheral stent procedures, as stroke is the leading
cause of death in China. We are currently applying for and planning regulatory and reimbursement approvals in important new markets
such as France, Taiwan and Korea and are working on distributor options for Japan to bolster our global footprint.
our cash position has improved significantly, after completing a $11.5 million public offering in mid-2020, and a $20.7 million
public offering last month as well as other successful equity offerings. We believe that we are now well-positioned financially
with the resources needed to execute our global expansion strategy. Our company focus is built on the foundational value of our
CGuard stent system, supportive of all delivery systems and available to all vascular specialists, resulting in the highest patient
care with unmatched clinical outcomes," concluded Mr. Slosman.
Results for the Fourth Quarter and Twelve Months ended December 31, 2020
the three months ended December 31, 2020, revenue decreased by $855,000, or 84.4%, to $158,000, from $1,013,000 during the three
months ended December 31, 2019. Revenues were negatively impacted by our settlement of litigation with a former distributor relating
to a 2014 transaction. Under the settlement, we agreed to pay them $580,000. Under US GAAP we were required to charge that amount
against sales. Excluding such impact, revenue decreased by $275,000, or 27.1%, to $738,000, from $1,013,000 during the three months
ended December 31, 2019. This decrease was driven mainly by a 25.2% decrease in sales volume of CGuard EPS from $921,000 during
the three months ended December 31, 2019, to $689,000 during the three months ended December 31, 2020, mainly due to the postponement
of procedures with CGuard EPS, which are generally scheduled or nonemergency procedures, as hospitals shifted resources to patients
affected by COVID-19. The 46.7% decrease in sales volume of MGuard Prime EPS from $92,000 during the three months ended December
31, 2019, to $49,000 during the three months ended December 31, 2020, was also mainly due to the impact of COVID-19, as mentioned
the three months ended December 31, 2020, gross profit decreased by 250.6%, or $649,000, to a negative $390,000, from $259,000
during the three months ended December 31, 2019. This decrease in gross profit resulted from the impact of the $580,000 settlement
with our former distributor in 2014 as well as $79,000 decrease in revenues less the related material and labor costs (as mentioned
above). This decrease was partially offset by a decrease of $10,000 in miscellaneous expenses during the three months ended December
31, 2020. Gross margin (gross profits as a percentage of revenue) decreased to a negative 246.8% during the three months ended
December 31, 2020 from 25.6% during the three months ended December 31, 2019, driven mainly by a negative effect on gross margin
of 272.5% due to the settlement with our former distributor.
operating expenses for the quarter ended December 31, 2020 were $3,328,000, an increase of 20.4% compared to $2,765,000 for the
same period in 2019. This increase was primarily due to increases of $363,000 in compensation expenses as we added resources to
our clinical, product development and sales infrastructure, $134,000 of Directors' and Officers' Liability Insurance
expense due to recent economic changes in the insurance industry, $96,000 in development expenses associated with CGuard EPS,
mainly related to the new advanced delivery system and accessories, and $75,000 of miscellaneous expense. These increases were
partially offset by a decrease in travel expenses of $105,000 in light of restrictions imposed by governments worldwide in order
to mitigate the spread of COVID-19.
the three months ended December 31, 2020, financial expenses increased by 385.2%, or $104,000, to $131,000, from $27,000 during
the three months ended December 31, 2019. The increase in financial expenses primarily resulted from changes in exchange rates.
loss for the fourth quarter of 2020 totaled $3,853,000, or $0.10 per basic and diluted share, compared to a net loss of $2,557,000,
or $0.57 per basic and diluted share, for the same period in 2019.
the twelve months ended December 31, 2020, revenue decreased by $1,236,000, or 33.2%, to $2,485,000, from $3,721,000 during the
twelve months ended December 31, 2019. Revenues were negatively impacted by 15.6% due to settlement of our litigation with a former
distributor relating to a 2014 transaction under which we agreed to pay them $580,000. Under US GAAP we were required to charge
that amount against sales. Excluding such impact, revenue decreased by $656,000, or 17.6%, to $3,065,000, from $3,721,000 during
the 12 months ended December 31, 2019.This decrease was driven mainly by a 15.3% decrease in sales volume of CGuard EPS from $3,265,000
during the twelve months ended December 31, 2019, to $2,764,000 during the twelve months ended December 31, 2020, mainly due to
the postponement of procedures with CGuard EPS, which are generally scheduled or nonemergency procedures, as hospitals shifted
resources to patients affected by COVID-19. There was also a 34.0% decrease in sales volume of MGuard Prime EPS from $456,000
during the twelve months ended December 31, 2019, to $301,000 during the twelve months ended December 31, 2020, mainly due to
the impact of COVID-19, as mentioned above.
the twelve months ended December 31, 2020, gross profit (revenue less cost of revenues) decreased by 89.0%, or $673,000, to $83,000,
compared to a $756,000 for the same period in 2019. This decrease in gross profit resulted from the impact of the $580,000 settlement
with our former distributor in 2014 as well as $198,000 decrease in revenues less the related material and labor costs (as mentioned
above). This decrease was partially offset by a decrease of $69,000 in expenses related to upgrades made to our production facilities
during the year ended December 31, 2019, which did not reoccur during the year ended December 31, 2020 and a decrease of $36,000
in miscellaneous expenses during the year ended December 31, 2020. Gross margin (gross profits as a percentage of revenue) decreased
to 3.3% during the year ended December 31, 2020 from 20.3% during the year ended December 31, 2019, driven mainly by a negative
effect on gross margin of 18.3% due to the settlement with our former distributor offset by a 1.3% gross margin increase due to
the upgrades made to our production facilities and miscellaneous expenses as mentioned above.
operating expenses for the twelve months ended December 31, 2020 were $10,463,000, a decrease of 1.0% compared to $10,572,000
for the same period in 2019. This decrease was primarily due to a decrease of $861,000 in clinical expenses associated with CGuard
EPS, mainly related to the IDE approval process, for which an approval from the FDA was received on September 8, 2020, $421,000
in travel expenses in light of restrictions imposed by governments worldwide in order to mitigate the spread of COVID-19, $354,000
due to settlement expenses that were paid to a former service provider pursuant to a settlement agreement during the twelve months
ended December 31, 2019, $136,000 in quality assurance and regulatory expenses related to the development of various projects
and $129,000 in promotional expenses, primarily related to having already built our social media infrastructure in 2019. These
decreases were partially offset by an increase in expenses of $531,000 in development expenses related to CGuard EPS new advanced
delivery system and accessories, $400,000 due to the settlement agreement with the underwriter of our prior offerings paid during
the twelve months ended December 31, 2020, $386,000 in compensation expenses as we added resources to our clinical, product development
and sales infrastructure, $249,000 in our Directors' and Officers' Liability Insurance expenses, partially due to
recent changes in the insurance industry, and $177,000 in regulatory expenses required for new regulatory standards set by the
European Union, and $49,000 of miscellaneous expenses.
expenses for the twelve months ended December 31, 2020 was $160,000 compared to $200,000 for the same period in 2019. The decrease
in financial expenses primarily resulted from changes in exchange rates.
loss for the twelve months ended December 31, 2020 totaled $10,544,000, or $0.46 per basic and diluted share, compared to a net
loss of $10,040,000, or $4.80 per basic and diluted share, for the same period in 2019.
of December 31, 2020, cash and cash equivalents were $12,645,000 compared to $5,514,000 as of December 31, 2019. During the first