CytoSorbents(CTSO) - 2024 Q1 - Quarterly Report

Product Usage and Development - CytoSorb has been used in over 237,000 human treatments globally for critical illnesses and cardiac surgery [274]. - The company has received FDA Emergency Use Authorization for CytoSorb in critically-ill COVID-19 patients, with over 7,650 treatments conducted to date [274]. - The company is developing multiple product candidates based on its blood purification technology, including DrugSorb-ATR and ContrastSorb [276]. - The company has completed its pivotal STAR-T trial evaluating the DrugSorb-ATR system, which aims to support FDA and Health Canada marketing approval [310]. - The company is now the preferred supplier of hemoadsorption technology to the three largest private hospital chains in Germany, facilitating access to CytoSorb [313]. - CytoSorb has been granted Emergency Use Authorization by the FDA for use in critically ill COVID-19 patients, allowing commercial sales in the U.S. [316]. Financial Performance - Revenue from product sales was approximately $8,990,000 for the three months ended March 31, 2024, an increase of approximately $1,080,000, or 14%, compared to $7,910,000 for the same period in 2023 [319]. - Distributor sales increased approximately $614,000, or 20%, while direct sales increased approximately $466,000, or 10% [319]. - Product gross margins improved to approximately 76% for the three months ended March 31, 2024, compared to 68% for the same period in 2023 [320]. - The company received approximately $880,000 in cash from the approved sale of net operating losses and research and development credits from the State of New Jersey in March 2024 [324]. - As of March 31, 2024, the company's total cash position was approximately $10.1 million, raising substantial doubt about its ability to continue as a going concern [328]. Sales and Marketing - The company entered a global marketing agreement with Fresenius Medical Care, positioning CytoSorb as the featured solution for cytokine, bilirubin, and myoglobin removal [282]. - Expansion of direct sales territories includes the U.K., Ireland, and France, bringing the total to 15 countries direct overall [285]. - The average exchange rate of the Euro to the U.S. dollar was $1.09 for the three months ended March 31, 2024, compared to $1.07 for the same period in 2023, positively impacting product sales by approximately $98,000 [319]. Operational Expenses and Agreements - The company recorded interest expense of approximately $10,700 related to a final fee for Term Loans for the three-month periods ended March 31, 2024, and 2023 [287]. - The company has a lease agreement for a new operating facility with monthly rental payments starting at approximately $111,171 [294]. - The weighted average remaining lease term as of March 31, 2024, was 12.4 years [297]. - The company granted options to purchase 110,000 shares of common stock to Board members, with a fair value of approximately $70,000 [300]. - The company granted 69,750 restricted stock units to employees, with a fair value of approximately $67,000, vesting upon a Change in Control [301]. Clinical Trials and Patient Enrollment - The company anticipates improved conditions for patient enrollment in clinical trials due to the easing of COVID-19 impacts [326].