Financial Performance - The company reported a net loss of $47.6 million for the year ended December 31, 2022, compared to a net loss of $43.8 million in 2021, resulting in an accumulated deficit of $239.7 million as of December 31, 2022 [226]. - Total revenue for the year ended December 31, 2022, was $43.1 million, representing a 95% increase from $22.1 million in 2021, driven by a $21.5 million increase in retail pharmacy revenue [235]. - The net loss for 2022 was $47.6 million, compared to a net loss of $43.8 million in 2021, indicating a decline of 8.5% in performance [316]. - Operating loss for the year was $46.4 million, which is a 6.7% increase from the operating loss of $43.5 million in the previous year [316]. - The company reported a net cash decrease of $7.97 million for the year ended December 31, 2022, compared to a decrease of $37.9 million in 2021 [322]. Revenue and Growth - Pharmacy and hardware revenue increased by 101% to $42.5 million in 2022, with a significant contribution from volume growth of approximately $13.5 million in Arizona, California, and Michigan [235]. - The pharmacy services business accounted for approximately 97% of the company's total revenues for the year ended December 31, 2022 [331]. - The company expects strong growth in its pharmacy technology segment in 2023 compared to 2022, with historically higher margins than the pharmacy services segment [219]. Expenses and Cost Management - The cost of products sold increased by 86% to $40.5 million in 2022, primarily due to volume growth and increased shipping costs associated with home delivery services [239]. - Pharmacy operations expenses increased by $2.4 million to $15.9 million in 2022, an 18% increase compared to 2021, primarily due to a $1.9 million rise in amortization of intangible assets [244]. - General and administrative expenses rose by approximately $1.2 million to $23.5 million in 2022, a 5% increase from 2021, driven by additional administrative staff and stock-based compensation [247]. - Selling and marketing expenses increased by approximately $1.3 million to $8.5 million in 2022, an 18% increase compared to 2021, mainly due to personnel costs for hiring additional Clinic Account Managers [250]. - Research and development expenses grew by approximately $0.3 million to $1.1 million in 2022, a 31% increase from 2021, reflecting ongoing investment in the MedCenter platform technology [252]. Cash Flow and Financing - Cash used in operating activities increased by $5.1 million to $47.7 million in 2022, a 12% increase compared to 2021 [267]. - Cash provided by financing activities increased by $34.0 million to $42.0 million in 2022, a 430% increase compared to 2021 [269]. - The company completed a private placement in March 2023, raising approximately $16 million to fund restructuring and growth initiatives related to its MedCenter technology business [335]. - The company continues to explore additional financing sources, including stock splits and warrant exercises, to address economic uncertainties and maintain liquidity [264]. Asset and Liability Management - Total current assets decreased to $23.9 million in 2022 from $27.4 million in 2021, a decline of 12.8% [314]. - Cash and cash equivalents dropped to $11.4 million in 2022, down from $19.7 million in 2021, a decrease of 41.5% [314]. - The company's total debt decreased from $9.5 million in 2021 to $4.8 million in 2022, a reduction of approximately 50% [402]. - Total liabilities decreased to $12.3 million in 2022 from $19.1 million in 2021, a reduction of 35.4% [314]. Strategic Initiatives - The company completed the sale of certain pharmacy assets to CVS for an aggregate purchase price of $2.6 million on February 9, 2023, as part of its exit strategy [222]. - The company initiated a reduction in force of approximately 75% of its full-time employees effective January 18, 2023, to preserve capital for its Pharmacy Technology Segment [220]. - The company exited the pharmacy services business in January 2023, resulting in a reduction of approximately 75% of its full-time employees [329]. Tax and Regulatory Considerations - The company has not recognized any income tax expense for the years ended December 31, 2022, and 2021, due to ongoing net income losses [256]. - The company obtained a waiver of any covenant non-compliance or defaults from its lenders for the year ended December 31, 2022 [273]. Market and Economic Factors - The company continuously monitors inflationary pressures that may affect costs, including wages and the price of prescription drugs [277]. - The Company assessed the impact of COVID-19 on its business and financial results, considering various evolving factors as of December 31, 2022 [343].
MedAvail (MDVL) - 2022 Q4 - Annual Report