Sedana Medical AB (publ), Interim report Q1, 2018. Record-breaking sales and increased market presence
Regulatory
Financial Summary January-March
- Net sales during the third quarter amounted to 15 487 (9 892) KSEK corresponding to an increase of 57% compared with the same period in 2017.
- Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to -788 (408) KSEK. This corresponds to an EBITDA margin of -5,1% (4,1%).
- Earnings before interest and taxes (EBIT) amounted to -1 730 (270) KSEK, which corresponds to an EBIT margin of -11,2% (2,7%).
- Cash flow from operations before changes in working capital amounted to -821 (279) KSEK.
- Liquid funds at the end of the period amounted to 79 213 (12 624) KSEK.
Significant events during the period
- The number of shares increased by 208,000 due to conversion of options, program 2014/2019.
- Peter Sackey took office as Medical Director on January 8, 2018.
- Sedana Medical AB (publ) started its own sales operations in Norway and Denmark.
Significant events after the Significant events after the period
- Sedana Medical AB (publ) announced that the schedule for patient recruitment for the ongoing phase 3 study IsoConDa is likely to be prolonged.
- Sedana Medical AB (publ) announced record increase in sales in the first quarter of 2018.
CEO comments
The first quarter of the year is now complete. We have reported a record sales increase of almost 60% in the first quarter of 2018 compared with the corresponding period in 2017, which is more than anticipated. The use of inhalation sedation with AnaConDa technology is spreading throughout Europe, which is in line with our strategy. However, our registration study IsoConDa has encountered certain challenges during the period, which we are confident we will be able to solve.
Our vision of developing inhalation sedation with IsoConDa and AnaConDa into a global standard method for sedation of mechanically ventilated patients in intensive care remains firm. In the first quarter of 2018, we delivered significantly better sales increases compared with our previously stated ambition of delivering an annual average sales growth of more than 20% until the registration of IsoConDa in Europe. We will also deliver an EBITDA result that will not be significantly negative, in parallel with building a larger sales and marketing organisation. It is our ambition to reach annual sales in excess of 500 MSEK and have an EBITDA margin of around 40% three years after the registration of IsoConDa in Europe.
SALES DEVELOPMENT
Germany is still the engine of our sales development. We are glad to see that there are not only new clinics taking up the therapy, but also that existing clinics, already using AnaConDa, extend the number of ICU beds where our therapy is used. In France, we have increased our sales resources which has shown results, as nearly 50 clinics use our product there now. Even in Spain, usage has increased during the first quarter of the year, albeit from low levels. The Nordic region, which recently was appointed a direct sales market, has also generated new clinics. In Norway, where we recently hired a Key Account Manager, we now have 6 clinics using AnaConDa regularly. In line with our plans, the operational costs increase as we develop the organization and increase our market presence. This generated an EBITDA for the first quarter of -788 KSEK.
During the quarter, we conducted our first global Advisory Board during an international congress in Brussels. The interest was great among international medical specialists in the field, and we had participants from the US, Canada, Belgium, France and Germany. During the same congress, we made our largest marketing effort ever, with exhibitions and several symposia, attracting great interest from existing and future customers.
REGULATORY AND MEDICAL DEVELOPMENTS
The most important task we have for the next few years is to register inhalation sedation with our drug candidate IsoConDa (isoflurane) in Europe and then the US. To succeed, we need to complete our clinical registration study which is currently in progress in Germany. Performing clinical studies in intensive care is challenging and complex and requires much effort from both sponsors and testers. Unfortunately, the inclusion rate of new patients has been temporarily slowed down following an on-site inspection that raised questions about the inclusion procedure for some unconscious patients. We now have an ongoing dialogue with inspectors and authorities to solve the problem so that the study can return to normal as soon as possible, something that all parties are interested in. The impact of the situation is premature to estimate, but it is likely that the study schedule will be extended slightly. In the study an interim analysis will be made which ultimately determines how many patients need to participate in the study and thus when the study can be completed. Because of the situation we cannot yet communicate when the interim analysis is to be completed. We will communicate around this as soon as a new time schedule is established. Work on preparing for a US registration of both pharmaceuticals and medical devices is ongoing, and we are confident that we will have a plan completed in 2018 how to register the therapy in the US.
In summary, I am very pleased with the sales development of our products and the fact that more clinics are starting to use the therapy more frequently as well as new ones are being added in several European countries. It shows that Sedana Medical is well placed to pioneer the process of offering the first commercial solution for inhalation sedation in intensive care, a market with a sales potential of SEK 10-20 billion annually.
Christer Ahlberg, President and CEO
For additional information, please contact:
Christer Ahlberg, CEO, Sedana Medical AB
+46 70 675 33 30
Christer.ahlberg@sedanamedical.com
Maria Engström, CFO, Sedana Medical AB
+46 70 674 33 30
Maria.engstrom@sedanamedical.com
Thomas Eklund, Chairman of the board, Sedana Medical AB
+46 70 824 20 25
Sedana Medical is listed on Nasdaq First North in Stockholm
and Erik Penser Bank (+46 8 463 83 00) is certified adviser to Sedana Medical.
This information is such that Sedana Medical AB (publ) is obliged to disclose pursuant to the EU Market Abuse Regulation. The information was released for public disclosure, through the agency of the contact persons above, on 22 May 2018 at 12.30 PM (CET).