Axonics Modulation Technologies Inc. (NASDAQ: AXNX) reported Q3 EPS of ($0.89), $0.14 worse than the analyst estimate of ($0.75). Revenue for the quarter came in at $1.31 million versus the consensus estimate of $1.45 million.

Recent Business Highlights

• Net sales of the Axonics r-SNM® System from international markets totaled $1.3 million in the third quarter of 2019 as compared to $0.2 million in revenue in the same period last year.
• Sales in the third quarter were derived primarily from England and the Netherlands along with three hospitals in Germany and three hospitals in Switzerland ordering in the quarter. A total of 32 hospitals in these markets and one in Canada are now implanting the Axonics r-SNM System.
• The first commercial patient was implanted in the United States at the University of California, Irvine on October 29 followed by a few dozen implants primarily for patients with bowel or dual incontinence in the first weeks following the commencement of sales in the U.S.
• During October and November, physician seminars were completed in Orlando, Irvine, Dallas and Boston. These one-day Saturday seminars were attended by 273 U.S.-based SNM implanters. A fifth program has been added in early December to accommodate demand with 46 additional physicians currently registered.
• On November 13, the U.S. Food and Drug Administration (“FDA”) approved the Axonics r-SNM® System for the clinical indication of overactive bladder (“OAB”) which includes urinary urge incontinence and urinary urge frequency as well as urinary retention.

Raymond W. Cohen, CEO of Axonics, commented, “We are satisfied with the results of the third quarter considering the fact that a significant number of our small, but growing customer base in Europe did not perform implants in August during the summer holiday season. While we will continue to add new customer accounts in Germany and Switzerland and look to increase implants in England to close out 2019, the Company is now focused on the launch of our product in the U.S. market.”

Cohen continued, “Given the attendance at our physician seminar series and enthusiastic response by the SNM implanting community to our product, we have made excellent strides towards establishing Axonics as a serious contender in sacral neuromodulation by bringing innovation and awareness to a therapy that has been underutilized. With respect to FDA approval for urinary clinical indications, we can now begin to communicate the outstanding clinical results of the Axonics r-SNM System. Survey results from the seminar attendees clearly indicate that these physicians place a high value on clinical results and state that when considering what product to offer their patients, efficacy is the single most important factor, followed by a long-lived device. Our 146-person U.S. field team is now able to directly and effectively deliver this message while providing the level of support required to convert customers to Axonics and retain them.”

Third Quarter 2019 Financial Results

• Net revenue was $1.3 million in the third quarter ended September 30, 2019 as compared to net revenue of $0.2 million for the same period of last year.
• Gross margin was 51.7%.
• Operating expense was $25.7 million for the third quarter of 2019, as compared to $7.6 million in the prior-year quarter. This increase was primarily due to higher personnel costs for the U.S. commercial team and across the organization related to increased headcount to support the commercial launch of the Company’s r-SNM System in the U.S.
• Net loss for the third quarter of 2019 was $25.0 million, as compared to $7.6 million in the prior-year quarter. Net loss per share was $0.89 per share.
• As of September 30, 2019, cash, cash equivalents and short-term investments were $101.5 million.

For earnings history and earnings-related data on Axonics Modulation Technologies Inc. (AXNX) click here.