Nuwellis(US:NUWE)2022-05-10 20:51Financial Data and Key Metrics Changes - Revenue for Q1 2022 was $1.93 million, representing a 17% sequential growth from Q4 2021 and essentially even with the prior year period [8][24] - Gross margin improved to 57.2%, a 6.8 percentage point increase from the prior year, driven by a favorable product sales mix and lower inventory revaluation expense [25] - Net loss for the quarter was $4.5 million or $0.42 per share, compared to a net loss of $5.2 million or $1.62 per share in Q1 2021 [26] - Cash and cash equivalents at the end of Q1 2022 were $19.3 million, providing a runway to fund operations through Q2 2023 [27] Business Line Data and Key Metrics Changes - Sales of consumables showed strong growth, primarily due to increased utilization of Aquadex therapy at major accounts [9][10] - Critical care and pediatric segments posted strong growth compared to the prior quarter, although both had lower total revenue than the prior year due to fewer console placements [10][11] - Heart failure segment experienced growth driven by increased utilization and favorable order timing [10] Market Data and Key Metrics Changes - Early Q1 sales were negatively impacted by COVID-19, affecting elective procedure volumes and hospital access, but improved as the quarter progressed [9] - The new CPT code for therapeutic ultrafiltration procedures is expected to enhance reimbursement and utilization of Aquadex therapy [13][15] Company Strategy and Development Direction - The company is focused on four growth catalysts: improved reimbursement, compelling clinical evidence, a new sales management system, and product development [12] - The strategy aims to make Aquadex therapy the standard of care for fluid management in patients resistant to diuretics [20][21] - Continued investment in product development includes a new dual lumen catheter and a dedicated pediatric continuous renal replacement therapy device [20] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism while monitoring the COVID-19 situation and its impact on healthcare worker availability [28] - The company is focused on winning new business and increasing utilization among existing customers, with expectations for a good Q2 [37] Other Important Information - The company has established a third-party patient access program to assist with questions related to the new CPT code and reimbursement [15] - Management highlighted the importance of clinical evidence in driving utilization and recognition in medical society guidelines [16] Q&A Session Summary Question: Interest from segments regarding the new CPT code - Management noted that interest is primarily coming from the heart failure segment, which has been significantly impacted by reimbursement issues in the past [35] Question: Trends in Q2 following disruptions in Q1 - Management indicated that trends in Q2 are similar to those seen in the latter part of Q1, expecting a good quarter [37] Question: Updates on international markets - Management recently visited Europe and reported excitement from distributors regarding new product development and clinical evidence as COVID-19 subsides [39] Question: Impact of IRB approval on trial timing - Management confirmed that they expect to enroll the first patient in the reverse HF trial soon and will continue patient enrollment throughout Q2 [41] Question: Capital sales performance - Management acknowledged that capital sales were weaker than expected due to pandemic-related access issues and funding priorities in hospitals [43] Question: Pediatric segment expectations - Management emphasized the strategic importance of the pediatric segment and noted strong results in Q1 due to increased utilization and recent presentations at academic symposiums [47]