OptiNose(OPTN) - 2024 Q3 - Quarterly Report

Financial Performance - Net product revenues for the three months ended September 30, 2024, were $20,437,000, up from$ 19,823,000 for the same period in 2023, reflecting a 3% growth[18]. - Total revenues for the nine months ended September 30, 2024, reached $55,807,000, compared to$ 51,122,000 for the same period in 2023, indicating a 9% increase[18]. - The company reported a net income of $467,000 for the three months ended September 30, 2024, a significant improvement from a net loss of$ (9,294,000) in the same period in 2023[20]. - As of September 30, 2024, the company reported a net loss of $21,181,000, an improvement from a net loss of$ 25,516,000 for the same period in 2023[26]. - For the three months ended September 30, 2024, the net income was $467,000 compared to a net loss of$ 9,294,000 for the same period in 2023[62]. - The basic net income per share for the three months ended September 30, 2024, was $0.00, while the basic net loss per share for the same period in 2023 was$ (0.08)[62]. Cash and Cash Equivalents - Cash and cash equivalents increased to $82,497,000 as of September 30, 2024, from$ 73,684,000 at December 31, 2023, representing a 11% increase[15]. - The company reported a net increase in cash and cash equivalents of $8,812,000 for the nine months ended September 30, 2024[26]. - The company had cash and cash equivalents of$ 82,497,000 and a working capital deficit of $34,215,000 as of September 30, 2024[30]. Expenses - Research and development expenses for the three months ended September 30, 2024, were$ 949,000, down from $1,281,000 in the same period of 2023, a decrease of 26%[18]. - Selling, general and administrative expenses increased to$ 19,475,000 for the three months ended September 30, 2024, compared to $18,011,000 for the same period in 2023, a rise of 8%[18]. - Stock-based compensation for the nine months ended September 30, 2024, was$ 5,481,000, compared to $4,219,000 for the same period in 2023[26]. - Interest expense for the three months ended September 30, 2024, was$ 5,294, an increase of 7.2% from $4,940 in the same period of 2023[97]. - The Company recorded depreciation expense of$ 65 for the three months ended September 30, 2024, compared to $102 for the same period in 2023, reflecting a decrease of 36.3%[82]. Liabilities and Deficits - The accumulated deficit increased to$ (741,557,000) as of September 30, 2024, from $(720,376,000) at December 31, 2023[15]. - Total liabilities decreased to$ 172,117,000 as of September 30, 2024, from $194,335,000 at December 31, 2023, a reduction of approximately 11%[16]. - The principal balance outstanding under the amended Note Purchase Agreement was$ 130,000,000 as of September 30, 2024[34]. - The company has substantial doubt about its ability to continue as a going concern within one year after the issuance of the consolidated financial statements[38]. - The Company has classified all outstanding principal and additional fees as current liabilities due to the likelihood of not maintaining compliance with required sales thresholds[95]. Inventory and Accounts Receivable - The total inventory as of September 30, 2024, was $11,301,000, an increase from$ 8,052,000 as of December 31, 2023[80]. - Five customers accounted for approximately 78% of the company's accounts receivable as of September 30, 2024, and represented about 74% of net product sales for the three months ended September 30, 2024[44]. Capital Raising and Offerings - The company completed a registered direct offering on May 10, 2024, raising net proceeds of $55.3 million by issuing 31,800,000 shares of common stock at$ 1.00 per share[32]. - The Company issued 4,680,000 shares of common stock to satisfy $4,680 of outstanding amendment and waiver fees under the A&R Note Purchase Agreement[93]. - The company completed a registered direct offering on May 10, 2024, issuing 31,800,000 shares of common stock at$ 1.00 per share, along with pre-funded warrants for 23,700,000 shares at $0.999 each[102]. Stock Options and Compensation - The company granted 1,703,101 service-based stock options during the nine months ended September 30, 2024, with a weighted average grant date fair value of$ 1.56[108]. - The unrecognized compensation cost related to unvested stock options expected to vest as of September 30, 2024, was $3,513,000, to be recognized over an estimated weighted-average amortization period of 2.4 years[109]. - The expected volatility for stock options granted was 75.03% for the nine months ended September 30, 2024[112]. - The company had 9,108,884 stock options outstanding as of September 30, 2024, with a weighted average exercise price of$ 4.04[108]. Future Outlook and Concerns - The company anticipates it will not meet the minimum trailing twelve-month consolidated XHANCE net sales and royalties thresholds under the A&R Note Purchase Agreement, which could lead to a default[37]. - Starting September 30, 2025, the company will need to make principal repayments of $16.3 million in eight quarterly installments until June 2027[36]. - The company may need to delay or curtail operations if it cannot accelerate growth in net revenues or obtain necessary modifications to its debt covenants[38]. - The company has incurred recurring net losses since inception, highlighting the need for continued capital raising and product development efforts[31]. Product Information - The company’s first commercial product, XHANCE, is focused on treating chronic rhinosinusitis, utilizing a proprietary delivery system[29]. - The company recognizes revenue from XHANCE sales upon delivery, including estimates of variable consideration such as chargebacks and discounts[51]. - The company is subject to discount obligations under state Medicaid programs and Medicare, which are recorded as liabilities in the same period the related revenue is recognized[54].