Femasys Inc. Announces Financial Results for the First Quarter Ended March 31, 2022

Rhea-AI Summary

Femasys Inc. (NASDAQ: FEMY) announced Q1 2022 financial results, reporting a net loss of $2.88 million or $0.24 per share. General and administrative expenses rose by 62.3% to $1.45 million, and R&D expenses increased by 42.8% to $1.42 million. Sales of FemVue® decreased by 2.5% to $321,405. Despite these challenges, Femasys is set to commercialize FemCerv® and FemCath™ by year-end and is making progress in clinical trials for FemBloc and FemaSeed. The company aims to enhance women's health solutions with its expanding product portfolio.

Positive

• Pending commercialization of FemCerv® and FemCath™ by year-end.
• Progress in clinical trials for FemBloc and FemaSeed expected to enhance future revenue.
• Appointment of experienced CFO and new board member strengthens leadership.

Negative

• Net loss increased to $2.88 million, compared to $1.83 million last year.
• General and administrative expenses rose significantly, impacting financial performance.
• Decreased sales in FemVue® product line by 2.5%.

- Furthers advancement of much-needed minimally invasive technologies for underserved areas of women’s health with pending commercialization of products, FemCerv^® and FemCath^™ expected by year-end

- Continued progress with FemaSeed and FemBloc biomedical product candidates in development

ATLANTA, May 11, 2022 (GLOBE NEWSWIRE) -- Femasys Inc. (NASDAQ: FEMY), a biomedical company aiming to meet women's needs worldwide by developing a suite of product candidates that include minimally invasive, in-office technologies for reproductive health, today announced financial results for the first quarter ended March 31, 2022.

“We are adding two approved products to our commercial portfolio as we broaden solutions to improve the continuum of healthcare options for women,” said Kathy Lee-Sepsick, founder, president and chief executive officer of Femasys. “FemCath, our selective delivery catheter, and FemCerv, our endocervical tissue sampler, are pending commercialization later this year, while supporting commercial efforts for our complementary FemVue^® diagnostic product, the first device enabling an in-office ultrasound diagnosis, an alternative approach to assess the fallopian tubes for infertility. Our goal is to further grow this synergistic product portfolio by exploring partnering opportunities and with our product candidates, FemBloc for permanent birth control and FemaSeed for infertility treatment once approved, designed to address substantial, multi-billion-dollar global market segments.”  

Ms. Lee-Sepsick added, “Women deserve safe options and the right to control their reproductive health and journey. In terms of the recent discussions regarding Roe v Wade, a ruling which occurred over 48 years ago, safety for women should be upheld as paramount. Safety and choice are core drivers in our mission to develop non-surgical reproductive health solutions for women around the world.”

First Quarter 2022 Highlights: Augmented Leadership

• In February, Dov Elefant was appointed to chief financial officer (CFO). Mr. Elefant has 25 years of financial management experience at both public and private biopharmaceutical companies. He brings a proven record as a senior level global financial expert with financial reporting, fundraising, and mergers and acquisitions expertise.
  
  
• In January, Wendy Perrow joined as a new board member. Ms. Perrow brings decades of experience in the life sciences industry related to fundraising, global product launches and corporate strategy.
  

First Quarter 2022 and Recent Developments Related to Clinical Programs

• Femasys expects to complete enrollment for its Stage 2 study of FemBloc in the third quarter of this year and file an IDE for a pivotal trial to support a PMA in the first quarter of next year.
  
  
• An interim analysis for the FemaSeed LOCAL de novo pivotal trial is planned for the fourth quarter of this year. The trial is being conducted across centers in the United States and is expected to enroll up to 792 patients who are diagnosed as infertile. The primary endpoints of the study are to determine effectiveness (clinical pregnancy rate) and safety over a period of up to seven weeks. The Company expects to complete enrollment in the second quarter of next year.
  

Ms. Lee-Sepsick continued, “We are on target to meet our milestones later this year in terms of obtaining an interim read-out from our up to 792-patient LOCAL de novo trial for FemaSeed. Recently, we added a number of new sites to our LOCAL trial, and we are encouraged that the impact of the pandemic may be waning, which has broadly affected enrollment for many clinical trials in the industry. In addition, we are approaching enrollment completion for our FemBloc study, and are on track for submitting our Investigational Device Exemption (IDE) filing early next year for a pivotal trial, which will be used in support of a Pre-Market Authorization (PMA) application for this product candidate.”

First Quarter 2022 Financial Results

• General and administrative expenses increased by $555,368, or 62.3%, to $1,447,355 for the three months ended March 31, 2022 from $891,987 for the three months ended March 31, 2021. The increase was largely due to various additional costs associated with being a public company, including salaries and related personnel costs due to an increase in headcount, facility, and other allocated overhead costs mainly for additional directors and officers (D&O) insurance, and increased professional costs for legal and accounting.
  
• Research and development expenses increased by $426,041 or 42.8%, to $1,421,063 for the three months ended March 31, 2022 from $995,022 for the three months ended March 31, 2021. The net increase of $426,041 largely consists of the $88,245 increase in compensation and related personnel costs primarily due to an increase in headcount, an increase of $270,497 in clinical-related costs associated with our clinical trials, and an increase of $50,707 in professional and outside consultant costs which are largely attributable to additional consulting costs to support the Company’s clinical trials.
  
• Sales of the Company’s FemVue^® product decreased by $8,370, or 2.5%, to $321,405 for the three months ended March 31, 2022 from $329,775 for the same period last year. The $8,370 decrease was largely attributable to the 4.1% decrease in U.S. units sold for the three months ended March 31, 2022 as compared to the same period last year. International sales were $58,045 for both the three months ended March 31, 2022 and 2021.
  
  
• Sales and marketing expenses increased by $46,044 or 201.8%, to $68,863 for the three months ended March 31, 2022 from $22,819 for the three months ended March 31, 2021 largely due to an increase in compensation and related personnel costs due to an increase in headcount and additional marketing costs associated with our FemVue social media campaign to increase our commercial presence.
  

      Cost of sales and gross margin percentage

• Cost of sales increased by $29,633, or 31.8%, to $122,675 for the three months ended March 31, 2022 from $93,042 for the three months ended March 31, 2021. The increase in cost of sales was largely due to increased labor and overhead costs applied to our cost of sales for the three months ended March 31, 2022 as compared to the same period last year mostly due to production personnel turnover as compared to the same period last year. As a result, gross margin percentage was 61.8% for the three months ended March 31, 2022 as compared to 71.8% for the three months ended March 31, 2021. The Company stated that it expects to see improvement in its gross margin in the future after investing in equipment and tooling that will replace and reduce labor in certain manufacturing processes as well as the costs of materials.
  
• Net loss was $2,883,030, or $0.24 per basic and diluted share attributable to common stockholders, primarily reflecting the factors noted above, for the period ended March 31, 2022, compared to $1,830,232, or $1.84 per basic and diluted share attributable to common stockholders, for the same period ended March 31, 2021.
  
  
• Cash and cash equivalents as of March 31, 2022 and December 31, 2021, were $21,767,634 and $24,783,029, respectively.
  

FEMASYS INC.
Balance Sheets
(unaudited)
Assets								March 31, 2022			December 31, 2021
Current assets:
	Cash and cash equivalents						$	21,767,634			24,783,029
	Accounts receivable, net							170,302			84,258
	Inventory, net							223,008			208,270
	Other current assets							567,300			555,853
					Total current assets			22,728,244			25,631,410
Property and equipment, at cost:
	Leasehold improvements							1,195,637			1,155,332
	Office equipment							99,344			99,344
	Furniture and fixtures							424,947			424,947
	Machinery and equipment							2,287,126			2,261,793
	Construction in progress							434,443			379,713
								4,441,497			4,321,129
Less accumulated depreciation								(2,854,315	)		(2,722,117	)
					Net property and equipment			1,587,182			1,599,012
Long-term assets:
	Lease right-of-use assets, net							574,943			665,747
	Intangible assets, net of accumulated amortization							17,663			25,093
	Other long-term assets							625,418			655,418
					Total long-term assets			1,218,024			1,346,258
					Total assets		$	25,533,450			28,576,680

FEMASYS INC.
Balance Sheets
(unaudited)
Liabilities and Stockholders’ Equity								March 31, 2022			December 31, 2021
Current liabilities:
	Accounts payable						$	548,377			445,522
	Accrued expenses							565,228			603,787
	Clinical holdback - current portion							36,238			18,947
	Note payable – current portion							45,666			181,123
	Lease liabilities – current portion							400,620			406,674
	Other – current							36,037			36,037
					Total current liabilities			1,632,166			1,692,090
Long-term liabilities:
	Clinical holdback - long-term portion							102,502			149,791
	Lease liabilities – long-term portion							305,071			402,417
					Total long-term liabilities			407,573			552,208
					Total liabilities			2,039,739			2,244,298
Commitments and contingencies
Stockholders’ equity:
	Common stock, $.001 par, 200,000,000 authorized,
		11,921,388 shares issued and 11,804,165 outstanding as of
		March 31, 2022 and December 31, 2021						11,921			11,921
	Treasury stock, 117,223 shares							(60,000	)		(60,000	)
	Warrants							702,492			702,492
	Additional paid-in-capital							108,462,663			108,418,304
	Accumulated deficit							(85,623,365	)		(82,740,335	)
					Total stockholders’ equity			23,493,711			26,332,382
					Total liabilities and stockholders' equity		$	25,533,450			28,576,680

FEMASYS INC.
Statements of Comprehensive Loss
(unaudited)
								Three Months Ended March 31,
								2022			2021
Sales							$	321,405			329,775
Cost of sales								122,675			93,042
					Gross margin			198,730			236,733
Operating expenses:
	Research and development							1,421,063			995,022
	Sales and marketing							68,863			22,819
	General and administrative							1,447,355			891,987
	Depreciation and amortization							144,199			153,453
					Total operating expenses			3,081,480			2,063,281
					Loss from operations			(2,882,750	)		(1,826,548	)
Other income (expense):
	Interest income, net							2,454			164
	Interest expense							(2,734	)		(3,848	)
					Other expense, net			(280	)		(3,684	)
					Net loss		$	(2,883,030	)		(1,830,232	)
Net loss attributable to common stockholders, basic and diluted							$	(2,883,030	)		(1,830,232	)
Net loss per share attributable to common stockholders, basic and diluted							$	(0.24	)		(1.84	)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted								11,804,165			995,208

About Femasys

Femasys Inc. is a biomedical company aiming to meet women's needs worldwide by developing a suite of product candidates that include minimally invasive, in-office technologies for reproductive health. Its two lead product candidates are FemBloc^® permanent birth control and FemaSeed^® localized directional insemination for infertility. The Company’s product for fallopian tube assessment by ultrasound, FemVue^®, is currently marketed in the United States. Femasys is also advancing FemCath^™, an intrauterine catheter for selective evaluation of the fallopian tubes and FemCerv^®, an endocervical tissue sampler that is the first product of the technology platform for tissue sampling intended to be marketed alongside its other women-specific medical products in the physician’s office setting.

Forward-Looking Statements

This press release contains forward-looking statements that are subject to substantial risks and uncertainties. Forward-looking statements can be identified by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “pending,” “intend,” “believe,” “potential” or “continue” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on our current expectations and are subject to inherent uncertainties, risks and assumptions, many of which are beyond our control, difficult to predict and could cause actual results to differ materially from what we expect. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ include, among others: our ability to develop and advance our current product candidates and programs into, and successfully initiate, enroll and complete, clinical trials; the ability of our clinical trials to demonstrate safety and effectiveness of our product candidates and other positive results; estimates regarding the total addressable market for our product candidates; our business model and strategic plans for our products, technologies and business, including our implementation thereof; and those other risks and uncertainties described in the section titled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2021 and our Form 10-Q for the quarter ended March 31, 2022, when filed with the Securities and Exchange Commission (the “SEC”), and other reports as filed with the SEC. Forward-looking statements contained in this press release are made as of this date, and Femasys undertakes no duty to update such information except as required under applicable law.

Contacts:

Investors
Chuck Padala
LifeSci Advisors, LLC
+1-917-741-7792
chuck@lifesciadvisors.com

Media
Zuri McClelland
LifeSci Communications
zmcclelland@lifescicomms.com

Femasys Inc.
Investor Contact:
IR@femasys.com

Media Contact:
Media@femasys.com

FAQ

What were Femasys' Q1 2022 financial results?

Femasys reported a net loss of $2.88 million or $0.24 per share for Q1 2022.

What is the status of FemCerv® and FemCath™ commercialization?

FemCerv® and FemCath™ are expected to be commercialized by the end of 2022.

How did FemVue® sales perform in Q1 2022?

Sales of FemVue® decreased by 2.5% to $321,405 in Q1 2022.

What clinical trials are currently underway for Femasys?

Femasys is progressing on clinical trials for FemBloc and FemaSeed, with enrollment expected to complete in 2023.

What is the company's outlook following the recent press release?

The company aims to enhance its product portfolio and commercial presence while addressing women's health needs.