Helius Medical Technologies, Inc. Reports Fourth Quarter and Full Year 2023 Financial Results
- Securing HCPCS codes for PoNS Therapy by Helius is a significant step towards reimbursement.
- Expansion of the stroke program and collaboration with MSSS show promising developments.
- Revenue decline in Q4 2023 compared to the previous year was primarily due to the expiration of PTAP.
- Operating expenses decreased in Q4 2023, contributing to improved financial management.
- The company raised $1.3 million in Q1 2024 through the ATM program, extending cash runway.
- Progress towards Medicare reimbursement, stroke patient treatment, and financial stability are highlighted in the PR.
- Revenue decline in Q4 2023 compared to the previous year.
- Net loss of $1.0 million in Q4 2023, compared to a net loss of $4.9 million in Q4 2022.
- Operating loss for the full year 2023 was $12.4 million, compared to a loss of $15.5 million for the full year 2022.
- Cash decreased from $14.5 million at December 31, 2022, to $5.2 million at December 31, 2023.
Insights
The recent financial results from Helius Medical Technologies reveal both positive developments and areas of concern for investors. The assignment of HCPCS codes by CMS for the PoNS device is a pivotal step towards reimbursement, which could significantly enhance the product's market penetration and revenue potential. The progress in the stroke registrational program and the LOI with Québec's MSSS indicate potential growth avenues. However, the sharp decline in Q4 revenue year-over-year, primarily due to the expiration of PTAP and lower sales in Canada, raises questions about current market demand and the company's ability to execute its commercial strategy effectively.
Furthermore, the company's decreased operating expenses and reduced net loss indicate a focus on cost containment, which is essential given the reduced revenue. The cash raised through the ATM program appears to provide a temporary cushion, but the sustainability of the company's financial position hinges on successful commercialization and reimbursement outcomes. The significant decrease in net loss per share year-over-year suggests an improvement in financial health, but the company's long-term viability is yet to be determined.
The neuromodulation market is witnessing growth, driven by technological advancements and an increasing prevalence of neurological disorders. Helius's PoNS device is situated in a niche segment focusing on balance and gait deficits, which could represent a unique value proposition if clinical outcomes are favorable and reimbursement is secured. The partnership with Québec's MSSS for the government-funded initiative could not only bolster the evidence base for PoNS Therapy’s effectiveness but also serve as a model for adoption in other regions or countries.
However, the reduced revenue in the latest quarter, despite these strategic developments, indicates that market adoption may be slower than anticipated. The decrease in product sales in Canada, a key market for Helius, could be indicative of saturation or competitive pressures. Investors should monitor the company's ability to convert regulatory and clinical milestones into tangible sales growth, as this will be critical for Helius's success in the competitive medical device landscape.
The securing of HCPCS codes from CMS is a strategic milestone for Helius, as it facilitates the path towards Medicare reimbursement. Reimbursement is often a critical factor in the adoption of new medical technologies, as it influences both provider prescribing behaviors and patient access. The company's engagement with CMS to secure Medicare reimbursement by October 2024 is a key area to watch, as it could dramatically influence the product's commercial success.
Additionally, the collaborative study with PBC and HTC showing improved RTW outcomes for TBI patients could serve as compelling evidence to support reimbursement cases. The financial impact of such studies cannot be overstated, as they provide the cost-benefit analyses that payers require to justify coverage of new therapies. The alignment with FDA on optimizing the stroke development plan and the initiation of new studies are also positive steps, yet the actual impact on business will depend on the outcomes of these studies and subsequent regulatory decisions.
-- Company to host call at 4:30pm today --
NEWTOWN, Pa., March 28, 2024 (GLOBE NEWSWIRE) -- Helius Medical Technologies, Inc. (Nasdaq:HSDT) (“Helius” or the “Company”), a neurotech company focused on delivering a novel therapeutic neuromodulation approach for balance and gait deficits, today announced results for the quarter and full year ended December 31, 2023.
Fourth Quarter and Recent Business Updates
- Secured Healthcare Common Procedure Coding System (“HCPCS”) Level II codes for the Portable Neuromodulation Stimulator (“PoNS®”) mouthpiece and controller from the Centers for Medicare & Medicaid Services (“CMS”), representing a significant step toward reimbursement.
- Further expanded the registrational program in stroke by adding a second site and initiating an open-label study; reached alignment with the U.S. Food and Drug Administration (“FDA”) on optimizing the stroke development plan.
- Signed a letter of intent (“LOI”) with the Québec Ministry of Health and Social Services (“MSSS”) to purchase up to 30 PoNS systems that will be distributed in five separate administrative regions within Québec as part of a government-funded initiative designed to evaluate the effectiveness of PoNS Therapy™ when used by patients suffering the effects of stroke.
- Released study results from collaborative project between Pacific Blue Cross (“PBC”) and HealthTech Connex (“HTC”), demonstrating that PoNS Therapy can drastically improve return-to-work (“RTW”) outcomes for patients suffering from traumatic brain injury (“TBI”).
- Q4 2023 revenue of
$134 thousand , compared to$282 thousand in Q4 2022, primarily attributable to the June 30, 2023 expiration of PTAP in the United States and lower Canada product sales. - Total operating expenses of
$2.3 million in Q4 2023, a decrease of$0.5 million compared to Q4 2022. - Generated
$1.3 million of net proceeds from the sale of shares of Company common stock under its At-The-Market (“ATM”) in Q1 2024, extending cash runway into Q3 2024.
“We are pleased to have reached a key milestone toward Medicare and broad third-party reimbursement last month when CMS assigned HCPCS codes for the PoNS mouthpiece and controller, effective April 1, 2024. We plan to engage with CMS in the coming months with the objective of securing Medicare reimbursement for the PoNS controller and mouthpiece to be effective as soon as October 1, 2024. In addition, these codes will facilitate our ability to concurrently pursue third-party payer coverage,” said Dane Andreeff, President and Chief Executive Officer of Helius.
“Delivering PoNS Therapy to stroke patients suffering from gait and balance deficit is one of our chief goals and I'm proud to report that we’ve made several meaningful strides toward potential U.S. authorization. In recent weeks, we’ve added a second site to our ongoing investigator-initiated, placebo-controlled study, begun enrollment of an open-label study at this same site, and met with the FDA to optimize our overall stroke development plan. We are now targeting an early 2025 regulatory submission with possible commercialization by the end of next year.”
“With
Fourth Quarter 2023 Financial Results
Total revenue for the fourth quarter of 2023 was
Cost of revenues was
Gross profit for the fourth quarter of 2023 was
Selling, general, and administrative expenses for the fourth quarter of 2023 decreased to
Research and development expenses for the fourth quarter of 2023 decreased to
Operating loss for the fourth quarter of 2023 decreased to a loss of
Net loss was
Full Year 2023 Financial Results
Total revenue for the full year 2023 was
Cost of revenue for the full year 2023 increased
Gross profit for the full year 2023 was
Selling, general, and administrative expenses for the full year 2023 decreased to
Research and development expenses for the full year 2023 decreased to
Operating loss for the full year 2023 decreased
Net loss for the full year 2023 was
Cash and Liquidity
Cash used in operating activities for the three months ended December 31, 2023, was
As of December 31, 2023, the Company had cash of
The Company had no debt outstanding at December 31, 2023.
| Conference Call | |
| Date: | Thursday, March 28, 2024 |
| Time: | 4:30 p.m. Eastern Time |
| Register (Audio only): | Click here |
| Webcast: | Click here |
The webcast will be archived under the Newsroom section of the Company’s investor relations website.
About Helius Medical Technologies, Inc.
Helius Medical Technologies is a leading neurotech company in the medical device field focused on neurologic deficits using orally applied technology platform that amplifies the brain’s ability to engage physiologic compensatory mechanisms and promote neuroplasticity, improving the lives of people dealing with neurologic diseases. The Company’s first commercial product is the Portable Neuromodulation Stimulator. For more information about the PoNS® or Helius Medical Technologies, visit www.heliusmedical.com.
About the PoNS Device and PoNS Therapy
The Portable Neuromodulation Stimulator (PoNS) is an innovative, non-implantable, orally applied therapy that delivers neurostimulation through a mouthpiece connected to a controller and it’s used, primarily at home, with physical rehabilitation exercise, to improve balance and gait. The PoNS device, which delivers mild electrical impulses to the tongue, is indicated for use in the United States as a short-term treatment of gait deficit due to mild-to-moderate symptoms from multiple sclerosis (“MS”) and is to be used as an adjunct to a supervised therapeutic exercise program in patients 22 years of age and over by prescription only.
PoNS has shown effectiveness in treating gait or balance and a significant reduction in the risk of falling in stroke patients in Canada, where it received authorization for sale in three indications: (i) for use as a short-term treatment (14 weeks) of gait deficit due to mild and moderate symptoms from stroke and is to be used in conjunction with physical therapy; (ii) for use as a short-term treatment (14 weeks) of chronic balance deficit due to mild-to-moderate traumatic brain injury (“mmTBI”) and is to be used in conjunction with physical therapy; and (iii) for use as a short-term treatment (14 weeks) of gait deficit due to mild and moderate symptoms from MS and is to be used in conjunction with physical therapy. PoNS is also authorized for sale in Australia for short term use by healthcare professionals as an adjunct to a therapeutic exercise program to improve balance and gait. For more information visit www.ponstherapy.com.
Cautionary Disclaimer Statement
Certain statements in this news release are not based on historical facts and constitute forward-looking statements or forward-looking information within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities laws. All statements other than statements of historical fact included in this news release are forward-looking statements that involve risks and uncertainties. Forward-looking statements are often identified by terms such as “believe,” “expect,” “continue,” “will,” “goal,” “aim” and similar expressions. Such forward-looking statements include, among others, statements regarding the Company’s expected results for its business and financial performance in 2024, the sufficiency of the Company’s future cash position, the development, commercialization and success of the Company’s PoNS and PoNS Treatment, future decisions and approvals from applicable regulatory entities in the U.S. and Canada, the Company’s strategic operating plans, and the uses and effectiveness of PoNS and PoNS Therapy.
There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those expressed or implied by such statements. Important factors that could cause actual results to differ materially from the Company’s expectations include uncertainties associated with the Company’s capital requirements to achieve its business objectives, availability of funds, the Company’s ability to find additional sources of funding, manufacturing, labor shortage and supply chain risks, including risks related to manufacturing delays, the Company’s ability to obtain national Medicare insurance coverage and to obtain a reimbursement code, the Company’s ability to continue to build internal commercial infrastructure, secure state distribution licenses, market awareness of the PoNS device, future clinical trials and the clinical development process, the product development process and the FDA regulatory submission review and approval process, other development activities, ongoing government regulation, and other risks detailed from time to time in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, and its other filings with the United States Securities and Exchange Commission and the Canadian securities regulators, which can be obtained from either at www.sec.gov or www.sedar.com.
The reader is cautioned not to place undue reliance on any forward-looking statement. The forward-looking statements contained in this news release are made as of the date of this news release and the Company assumes no obligation to update any forward-looking statement or to update the reasons why actual results could differ from such statements except to the extent required by law.
Investor Relations Contact
Lisa M. Wilson, In-Site Communications, Inc.
T: 212-452-2793
E: lwilson@insitecony.com
| Helius Medical Technologies, Inc. | ||||||||||||||||
| Unaudited Condensed Consolidated Statements of Operations | ||||||||||||||||
| (in thousands, except share and per share data) | ||||||||||||||||
| Three Months Ended | Years Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Revenue | ||||||||||||||||
| Product sales, net | $ | 123 | $ | 281 | $ | 605 | $ | 778 | ||||||||
| Other revenue | 11 | 1 | 39 | 9 | ||||||||||||
| Total revenue | 134 | 282 | 644 | 787 | ||||||||||||
| Cost of revenue | 90 | 150 | 583 | 463 | ||||||||||||
| Gross profit | 44 | 132 | 61 | 324 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Selling, general and administrative expenses | 1,632 | 1,967 | 9,271 | 10,640 | ||||||||||||
| Research and development expenses | 650 | 794 | 2,942 | 4,262 | ||||||||||||
| Amortization expense | 8 | 40 | 117 | 181 | ||||||||||||
| Goodwill and fixed asset impairment | — | — | 159 | 757 | ||||||||||||
| Total operating expenses | 2,290 | 2,801 | 12,489 | 15,840 | ||||||||||||
| Loss from operations | (2,246 | ) | (2,669 | ) | (12,428 | ) | (15,516 | ) | ||||||||
| Nonoperating income (expense) | ||||||||||||||||
| Interest income (expense), net | — | 85 | 257 | (834 | ) | |||||||||||
| Change in fair value of derivative liability | 915 | (2,462 | ) | 2,966 | 3,027 | |||||||||||
| Foreign exchange (loss) gain | 213 | 154 | 275 | (756 | ) | |||||||||||
| Other income (expense), net | 73 | 6 | 80 | 7 | ||||||||||||
| Nonoperating income (expense), net | 1,201 | (2,217 | ) | 3,578 | 1,444 | |||||||||||
| Loss before provision for income taxes | (1,045 | ) | (4,886 | ) | (8,850 | ) | (14,072 | ) | ||||||||
| Provision for income taxes | — | — | — | — | ||||||||||||
| Net loss | $ | (1,045 | ) | $ | (4,886 | ) | $ | (8,850 | ) | $ | (14,072 | ) | ||||
| Loss per share | ||||||||||||||||
| Basic | $ | (1.47 | ) | $ | (8.66 | ) | $ | (14.56 | ) | $ | (52.13 | ) | ||||
| Diluted | $ | (1.47 | ) | $ | (8.66 | ) | $ | (14.56 | ) | $ | (52.13 | ) | ||||
| Weighted average number of common shares outstanding | ||||||||||||||||
| Basic | 708,603 | 564,014 | 607,890 | 269,929 | ||||||||||||
| Diluted | 708,603 | 564,014 | 607,890 | 269,929 | ||||||||||||
| Helius Medical Technologies, Inc. | ||||||||
| Unaudited Condensed Consolidated Balance Sheets | ||||||||
| (in thousands, except share and per share data) | ||||||||
| December 31, 2023 | December 31, 2022 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 5,182 | $ | 14,549 | ||||
| Accounts receivable, net | 117 | 71 | ||||||
| Other receivables | 520 | 272 | ||||||
| Inventory, net | 457 | 589 | ||||||
| Prepaid expenses and other current assets | 1,162 | 1,216 | ||||||
| Total current assets | 7,438 | 16,697 | ||||||
| Property and equipment, net | 178 | 347 | ||||||
| Intangible assets, net | 24 | 140 | ||||||
| Operating lease right-of-use asset, net | 52 | 103 | ||||||
| Total assets | $ | 7,692 | $ | 17,287 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 531 | $ | 627 | ||||
| Accrued and other current liabilities | 1,260 | 1,280 | ||||||
| Current portion of operating lease liabilities | 45 | 54 | ||||||
| Current portion of deferred revenue | 43 | 27 | ||||||
| Total current liabilities | 1,879 | 1,988 | ||||||
| Operating lease liabilities, net of current portion | 12 | 56 | ||||||
| Deferred revenue, net of current portion | 128 | 175 | ||||||
| Derivative liability | 3,323 | 6,917 | ||||||
| Total liabilities | 5,342 | 9,136 | ||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Class A common stock, | 1 | 1 | ||||||
| Additional paid-in capital | 162,979 | 159,645 | ||||||
| Accumulated deficit | (159,957 | ) | (151,107 | ) | ||||
| Accumulated other comprehensive loss | (673 | ) | (388 | ) | ||||
| Total stockholders' equity | 2,350 | 8,151 | ||||||
| Total liabilities and stockholders' equity | $ | 7,692 | $ | 17,287 | ||||
FAQ
What are the key highlights of Helius Medical Technologies, Inc.'s (HSDT) recent PR?
Why did Helius Medical Technologies, Inc. (HSDT) experience a revenue decline in Q4 2023?
How much did Helius Medical Technologies, Inc. (HSDT) raise in Q1 2024, and through which program?
What progress has Helius Medical Technologies, Inc. (HSDT) made towards Medicare reimbursement?
What financial updates were provided in Helius Medical Technologies, Inc.'s (HSDT) PR?
