Ra Medical Systems reports 2Q 2021 results

Ra Medical Systems, Inc, a medical device company focusing on commercializing its excimer laser system to treat vascular disease, reports financial results for the three and six months ended June 30, 2021 and provides a business update.

Recent Operational Highlights
Announced the sale of the Pharos dermatology business as part of the continued focus by the company of its resources on the large peripheral artery disease (PAD) market
Enrolled 20 additional subjects in the company’s atherectomy pivotal clinical study since early May, for a total of 70 subjects enrolled to date in the 100-subject study
Continued progress on catheter engineering projects including a hands-on workshop with interventional physicians to test guidewire compatible prototype devices
Conducted early, promising research demonstrating the ability to use the DABRA system to fracture calcium in arteries
“Earlier today we announced the sale of our Pharos dermatology business following an extensive review and evaluation of strategic options. We believe this decision provides the best pathway to building shareholder value by allowing Ra Medical to continue to focus our resources on the large and growing market for medical devices to treat PAD. An estimated 19 million to 21 million people in the U.S. have PAD and the market segments we are targeting are projected to exceed $900 million in revenue this year,” said Will McGuire, Ra Medical CEO.

“We have reduced our expense structure going forward while improving our financial position as a result of the net proceeds received from the transaction and our At-the-Market offerings,” he added. “We are also exploring the potential for our DABRA technology to create shock waves that can fracture arterial calcium, sometimes referred to as intravascular lithotripsy. This application of our technology represents an exciting potential growth opportunity to treat calcified vessels in the PAD and coronary artery disease markets.”

Second Quarter Financial Highlights
Net revenue for the second quarter of 2021 was $1.0 million, which consisted of product sales of $0.3 million and service and other revenue of $0.7 million. This compares with net revenue of $0.9 million for the second quarter of 2020, which consisted of product sales of $0.2 million and service and other revenue of $0.7 million.

Net revenue from the vascular segment was de minimis for the second quarter of 2021 and was $0.1 million for the second quarter of 2020. Net revenue from the dermatology segment was $1.0 million for the second quarter of 2021 and $0.8 million for the second quarter of 2020.

Total cost of revenue for the second quarter of 2021 was $1.5 million, compared with $1.2 million for the second quarter of 2020.

Selling, general and administrative expenses for the second quarter of 2021 were $3.7 million, which included $0.5 million in stock-based compensation, compared with $7.9 million for the second quarter of 2020, which included $0.8 million in stock-based compensation. Research and development expenses for the second quarter of 2021 were $3.0 million, which included $0.1 million in stock-based compensation, compared with $2.0 million for the second quarter of 2020, which included $0.1 million in stock-based compensation.

The net loss for the second quarter of 2021 was $5.2 million, or $1.28 per share on 4.1 million weighted-average shares outstanding, compared with a loss for the second quarter of 2020 of $10.1 million, or $10.71 per share on 0.9 million weighted-average shares outstanding.

Adjusted EBITDA for the second quarter of 2021 was negative $6.1 million, compared with negative $8.4 million for the second quarter of 2020. Adjusted EBITDA is a non-GAAP measure presented as net loss before depreciation and amortization expense, interest income, interest expense, income taxes, stock-based compensation, gain from sale of property and equipment and gain on extinguishment of debt. For additional information regarding the non-GAAP financial measures discussed in this news release, please see “Non-GAAP Reconciliations” below.

Six Month Financial Highlights

Net revenue for the first six months of 2021 was $2.1 million, which consisted of product sales of $0.7 million and service and other revenue of $1.4 million. This compares with net revenue for the first six months of 2020 of $2.3 million, which consisted of product sales of $0.7 million and service and other revenue of $1.5 million.

Net revenue from the vascular segment was de minimis for the first six months of 2021, compared with $0.2 million for the first six months of 2020. Net revenue from the dermatology segment of $2.1 million was unchanged for the first six months of 2021 and 2020.

Total cost of revenue for the first six months of 2021 was $2.9 million, compared with $2.8 million for the first six months of 2020.

Selling, general and administrative expenses for the first six months of 2021 were $7.9 million, which included $1.5 million in stock-based compensation, compared with $14.2 million for the first six months of 2020, which included $1.7 million in stock-based compensation. Research and development expenses for the first six months of 2021 were $5.8 million, which included $0.2 million in stock-based compensation, compared with $3.2 million for the first six months of 2020, which included $0.2 million in stock-based compensation.

The net loss for the first six months of 2021 was $12.5 million, or $3.56 per share on 3.5 million weighted-average shares outstanding, compared with a net loss for the first six months of 2020 of $17.8 million, or $23.83 per share on 0.7 million weighted-average shares outstanding.

Adjusted EBITDA for the first six months of 2021 was negative $12.2 million, compared with negative $14.6 million for the first six months of 2020. Adjusted EBITDA is a non-GAAP measure presented as net loss before depreciation and amortization expense, interest income, interest expense, income taxes, stock-based compensation, gain on sale of property and equipment and gain on extinguishment of debt. For additional information regarding the non-GAAP financial measures discussed in this news release, please see “Non-GAAP Reconciliations” below.

Ra Medical reported cash and cash equivalents of $20.2 million as of June 30, 2021. Between July 1, 2021 and August 2, 2021, Ra Medical received approximately $4.4 million in net proceeds, after deducting placement agent fees, from At-the-Market offerings. Ra Medical expects to receive $3.6 million in net proceeds from the sale of the Pharos business after deducting financial advisor fees. ACROFAN