Sedana Medical AB (publ), Interim Report, Q3, July-September 2017: Continued strong sales growth and registration study for Europe according to plan
Regulatory
Financial summary July-September · Net sales during the third quarter amounted to 10,191 (7,603) KSEK, corresponding to an increase of 34% compared with the same period in 2016. · Earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to -980 (-381) KSEK. This corresponds to an EBITDA margin of -9.6% (-5.0%). · Earnings before interest and taxes (EBIT) amounted to -2,254 (-511) KSEK, which corresponds to an EBIT margin of -22.1% (-6.7%). · Cash flow from operations before changes in working capital amounted to -1,862 (181) KSEK. · Liquid funds at the end of the period amounted to 90,156 (1,772) KSEK. Financial summary January-September · Net sales during the first nine months of the year amounted to 29,632 (23,283) KSEK, which corresponds to an increase of 27% compared with the same period in 2016. · Earnings before interest, taxes, depreciation and amortisation (EBITDA) amounted to 102 (57) KSEK. This corresponds to an EBITDA margin of 0.3% (0.2%). · Earnings before interest and taxes (EBIT) amounted to -1,575 (-215) KSEK, which corresponds to an EBIT margin of -5.3% (-0.9%). · Cash flow from operations before changes in working capital amounted to -3,045 (-138) KSEK.
Significant events during the period
- In South Korea, the first patients in Asia were treated using the AnaConDa device.
- The process of recruiting new clinics to the registration study for IsoConDa has continued in Germany, and we have now recruited around half of the planned number of clinics.
- The overallotment option in the IPO was exercised.
- Direct sales to hospitals in the Nordic region were initiated through recruitment of in-house sales personnel.
Significant events after the period
- Senior Consultant and Associate Professor Peter Sackey was recruited as Chief Medical Officer (CMO). Peter Sackey has over twenty years’ clinical experience as a physician within anaesthesiology and intensive care, and joins Sedana from a position within Perioperative Medicine and Intensive Care at Karolinska University Hospital in Solna, Sweden. Sackey is one of the world's leading researchers in the field of inhalation sedation and was the first to use AnaConDa within intensive care.
- All remaining outstanding warrants in the incentive programme 2017/2021, which was initiated in conjunction with the IPO, were acquired by incoming Chief Medical Officer Peter Sackey.
- The process of recruiting patients and new clinics to the registration study for IsoConDa has continued in Germany. Sixteen clinics have now been approved, and another two are close to approval. In addition, we have a further 10 or so clinics under evaluation or in the process of contract finalisation.
- On November 23, Sedana Medical’s distributor in Japan submitted the application for registration of the medical device AnaConDa in Japan.
CEO comments
It has been a very active summer and autumn for Sedana Medical. During this period, we have worked hard on enhancing our leading role within inhalation sedation and our ability to implement the plans we have for the coming years. We have moved one step closer to achieving our vision of developing inhalation sedation with IsoConDa and AnaConDa into a global standard method for sedation of mechanically ventilated patients within intensive care.
We are living up to our previously expressed financial ambition of achieving an annual increase in sales of more than 20%, and an EBITDA figure that is not significantly negative in the time prior to the registration of IsoConDa in Europe, while at the same time, we are building up 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.
The third quarter has shown an increase in sales of 34% compared with the same period last year. Operating costs have increased during the quarter, which is in line with our plans regarding organisational development and increased market activities. All this has resulted in EBITDA of -980 KSEK for the third quarter and +102 KSEK for the first nine months of the year, which is in line with our long-term ambition.
Sales developments
Demand for inhalation sedation and our product AnaConDa continues to grow, in particular in Germany, which is our main market. The number of intensive care clinics in Germany that actively use AnaConDa is increasing month-by-month, and there are currently more than 400 such clinics. During the period we have initiated direct sales operations in the Nordic region, starting in Sweden, where I am pleased to report that we have already received our first orders. In the near future we will also be commencing sales operations in Finland and Denmark as well as Norway from March 2018.
Our market activities during the period have made a significant contribution to increased global awareness of inhalation sedation and AnaConDa. We have taken part in the largest national and international congresses where we have held exhibitions, and above all else we have arranged scientific symposiums with some of the world’s leading researchers within the field. For example, we participated at SFAR in Paris and ESICM in Vienna, where our symposiums attracted hundreds of practising physicians. We intend to continue to invest resources in increased market presence and sales development.
Regulatory and Medical developments
One significant development during the period is the recruitment of our new Chief Medical Officer (CMO), Peter Sackey. Peter has over twenty years’ clinical experience as a senior consultant and associate professor within anaesthesiology and intensive care at Karolinska University Hospital in Solna, Sweden. Peter will be responsible for the ongoing clinical registration study regarding IsoConDa, and will play a leading role in the preparation of the registration dossier in the EU and the development of our regulatory strategy in the USA.
In conclusion, I am very pleased with our efforts during the third quarter and we are well on course to achieve our high ambitions regarding both registration and growth targets.
The first nine months of 2017 have demonstrated that Sedana Medical is well placed to pioneer the process of offering the first commercial solution for inhalation sedation within 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
Pareto Securities 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 November 30, 2017 at 07.00 AM (CET).
Sedana Medical AB (publ) has developed and sells the medical device AnaConDa, for the administration of volatile anaesthetics to mechanically ventilated patients. A major clinical registration study is currently ongoing to obtain market approval in Europe for inhalation sedation in intensive care units with the pharmaceutical IsoConDa® (isoflurane)
Sedana Medical has direct sales in the Nordic countries, Germany, France and Spain as well as external distributors in the rest of Europe, Middle East, Canada, Australia and South Korea. The company headquarters are based in Stockholm, Sweden with R&D operations in Ireland.