Helius Medical Technologies reports Q4 and full-year 2023 results

Helius Medical Technologies, Inc. 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 $1.3 million raised under our ATM program since year end, we now have the cash runway to take us into the third quarter of 2024 as we continue progressing our stroke registrational program and pursuing widespread reimbursement,” concluded Andreeff.

Fourth quarter 2023 financial results
Total revenue for the fourth quarter of 2023 was $134 thousand, a decrease of $148 thousand compared to $282 thousand in the fourth quarter of 2022 primarily attributable to the June 30, 2023 expiration of PTAP in the United States and lower Canada product sales.

Cost of revenues was $90 thousand for the three months ended December 31, 2023, compared to $150 thousand for the comparable period in 2022, primarily due to decreased revenues.

Gross profit for the fourth quarter of 2023 was $44 thousand, compared to gross profit of $132 thousand in the fourth quarter of 2022.

Selling, general, and administrative expenses for the fourth quarter of 2023 decreased to $1.6 million, compared to $2.0 million in the fourth quarter of 2022 due primarily to a decrease in compensation related expenses.

Research and development expenses for the fourth quarter of 2023 decreased to $0.7 million compared to $0.8 million in the fourth quarter of 2022, resulting primarily from a decrease in clinical and product development expenses in the current year period.

Operating loss for the fourth quarter of 2023 decreased to a loss of $2.2 million, compared to an operating loss of $2.7 million in the fourth quarter of 2022.

Net loss was $1.0 million for the fourth quarter of 2023, compared to a net loss of $4.9 million in the fourth quarter of 2022. The basic and diluted net loss per share for the fourth quarter 2023 was $1.47, compared to net loss per share of $8.66 in the fourth quarter 2022.

Full year 2023 financial results
Total revenue for the full year 2023 was $644 thousand, compared to $787 thousand for the full year 2022, due to lower Canada product sales resulting from the prior year inclusion of approximately $120 thousand of revenue recognized in connection with the delivery PoNS devices related to noncash consideration paid in the Company’s acquisition of Heuro.

Cost of revenue for the full year 2023 increased $120 thousand to $583 thousand, compared to cost of revenue of $463 thousand for the full year 2022, primarily attributable to fixed overhead costs, including salaries and benefits of employees involved in management of the supply chain and certain production costs.

Gross profit for the full year 2023 was $61 thousand, compared to gross profit of $324 thousand for the full year 2022.

Selling, general, and administrative expenses for the full year 2023 decreased to $9.3 million, compared to $10.6 million for the full year 2022, due primarily to a $0.6 million decrease in stock-based compensation and a $0.6 million decrease in payroll taxes including the $0.5 million Employee Retention Credit claims we filed for the prior eligible periods.

Research and development expenses for the full year 2023 decreased to $2.9 million, compared to $4.3 million for the full year 2022, due primarily to decreases in product development expenses and clinical trial activities as we transitioned our focus from product development and clinical trials to U.S. commercialization activities beginning in 2022.

Operating loss for the full year 2023 decreased $3.1 million to a loss of $12.4 million, compared to a loss of $15.5 million for the full year 2022.

Net loss for the full year 2023 was $8.9 million, compared to $14.1 million for the full year 2022. The basic and diluted net loss per share for the full year 2023 was $14.56 per share, compared to $52.13 per share, for the full year 2022.

Cash and liquidity
Cash used in operating activities for the three months ended December 31, 2023, was $2.0 million, compared to $2.1 used in operating activities in the fourth quarter of 2022, reflecting the results of our continued focus on managing cash burn.

As of December 31, 2023, the Company had cash of $5.2 million, compared to $14.5 million at December 31, 2022. In Q1 2024, the Company generated $1.3 million of net proceeds from the sale of shares of its common stock under its ATM program at an average share price of $9.27 per share, extending the cash runway into Q3 2024.

The Company had no debt outstanding at December 31, 2023.
MB Bureau