InspireMD Reports 2012 Fiscal Year Results

Sep 12, 2012, 08:00 ET from InspireMD, Inc

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TEL AVIV, Israel, September 12, 2012 /PRNewswire/ --

InspireMD, Inc. (OTC BB NSPR) (the "Company" or "InspireMD"), a medical device company focusing on the development and commercialization of its proprietary embolic protection stent platform technology for use in patients with Acute Myocardial Infarctions, today announced financial results for the six months ended June 30, 2012.

As previously announced, the Company changed its fiscal year end to June 30. As a result, the six months ended June 30, 2012 represent a transition period, with the next fiscal year covering the period from July 1, 2012 through June 30, 2013

"Several key milestones were achieved during the six months ended June 30, 2012," said Ofir Paz, Co-founder and CEO of InspireMD.  We completed enrollment in the nine-country, 433-patient MASTER trial ahead of schedule, raised $11 million with a convertible debt offering and strengthened senior management.

"Subsequently, on August 20, we received notice that the MASTER trial comparing the MGuard™ embolic prevention stent to commercially-approved bare metal or drug-eluting stents in heart attack patients undergoing primary percutaneous coronary intervention (PCI) demonstrated a positive outcome," he added. "This is a significant milestone for InspireMD.  We are eagerly awaiting presentation of the study's findings at the Transcatheter Cardiovascular Therapeutics (TCT) meeting next month in Miami."

The MASTER (MGuard for Acute ST Elevation Reperfusion) trial is the first company-sponsored randomized clinical study of the MGuard™ embolic protection stent.

In eleven prior single arm studies and a 40-patient physician-sponsored randomized trial, the MGuard™ embolic protection stent showed effectiveness in restoring blood flow and reducing major adverse events following heart attack stenting.

About 3.2 million stenting procedures are expected to be performed worldwide this year, of which 850,000, or about 26 percent, will be for patients having heart attacks.  Of the $5.9 billion global stent market, stents for heart attacks account for $1.7 billion, or nearly 30 percent, of the total.

Transition Period Financial Highlights

For the six-month transition period ended June 30, 2012, compared to the corresponding six month time period of 2011:

  • Total revenues were $2.1 million, compared with approximately $2.7 million during the same period in 2011.
  • The decrease in revenue year over year was mainly attributable to a first time shipment of approximately $1.2 million to the Company's distributor in India during the first three months of 2011. This was a large shipment used to launch MGuard[TM] in India -- no such single large sale occurred during the transition period in 2012.
  • Shipments to other countries (excluding India) increased by approximately $0.7 million, or 56.5%, compared to the same period in 2011.  
  • Gross profit was $0.7 million, a decrease of 41.5% or approximately $0.5 million, from the same period in 2011. 
  • The gross margin decrease was driven by a reserve set forth for slow moving inventory in the amount of approximately $0.4 million. Approximately 89.7% of the decreased in gross margin is attributable to this reserve.
  • Total operating expenses were $7.9 million compared to $4.5 million in the same period of 2011. This increase was mainly driven by increased share-based compensation of $1.3 million, additional R&D expenditures relating to the MASTER trial, the planned FDA trial and the carotid stent development expenses of $1.2 million, increased salary and related expenses of approximately $0.4 million due to operational expansion and other expenses of $0.5 million.  
  • Loss from operations was $7.2 million, compared to a loss from operations of $3.3 million in the same period in 2011.
  • The net loss was $7.1 million, or $0.10 per weighted average share, compared to a net loss of $4.1 million in the same period of 2011.
  • The Company ended the transition period with cash and cash equivalents of approximately $10.3 million, compared to $8.1 million in the same period in 2011.

June 30, 2012 Transition Period and Subsequent Achievements

--Enrollment in the 433-patient randomized MASTER trial, which is comparing the MGuard™ embolic prevention stent to conventional stents in heart attack patients in nine countries, was completed in May, one month ahead of schedule.

--On August 20, 2012, the Company announced that the MASTER trial demonstrated a positive outcome.  Detailed results will be presented at the upcoming Transcatheter Cardiovascular Therapeutics (TCT) meeting in Miami, FL (October 22-26, 2012).

--Positive results were reported from the first randomized trial of the MGuard™ embolic protection stent, a 40-patient physician-sponsored study in Chile.  The MICAMI trial showed a significant improvement in microvascular reperfusion for MGuard™ vs. bare metal stents.

--Dr. James Barry, a former senior executive at Boston Scientific, joined the Company's Board of Directors, and Robert Ratini was appointed Vice President of Sales and Marketing, with responsibilities for global marketing strategies for the MGuard stent technology.

--The Company closed a private placement of senior secured convertible debentures that resulted in $11 million of net proceeds. The debentures were issued with a 6% original issuance discount, bear interest of 8 percent per annum (up to a maximum aggregate of 12% for the term of the debentures) and are convertible at any time into common stock at $1.75 per share.

--Three-year data from the extended follow-up of the 60-patient prospective MAGICAL trial was presented, showing statistically significant improvement in acute outcomes in heart attack patients when compared with traditional bare metal stents.  Ninety percent of the patients achieved TIMI grade 3 flow, 73.3 percent achieved myocardial blush grade 3, and 61.4 percent achieved complete ST segment resolution.

                (U.S. dollars in thousands, except per share data)
                                                          Six months ended
                                                              June 30,
                                                        2012              2011
    Revenues                                          $2,071            $2,726
    Cost of Revenues                                   1,377             1,539
    Gross Profit                                         694             1,187
    Operating Expenses:
    Research and development                           2,607             1,093
    Selling and marketing                              1,246             1,045
    General and administrative                         3,999             2,391
    Total operating expenses                           7,852             4,529
    Loss from Operations                              -7,158            -3,342
    Financial (income),expenses net                     -109               787
    Loss before tax expenses                          -7,049            -4,129
    Tax Expenses                                          32                20
    Net Loss                                         ($7,081)          ($4,149)
    Net loss per share - basic and diluted            ($0.10)           ($0.07)
    Weighted average number of shares of
    common stock used in computing net
    loss per share - basic and diluted            68,176,882        57,312,945

                       CONSOLIDATED BALANCE SHEETS (2)
                          (U.S. dollars in thousands)
                                                       June 30,   December 31,
    ASSETS                                               2012         2011
    Current Assets:
    Cash and cash equivalents                          $10,284       $5,094
    Restricted cash                                         37           91
    Accounts receivable:
    Trade                                                1,824        2,284
    Other                                                  264          118
    Prepaid expenses                                        93           72
    On hand                                              1,744        2,061
    On consignment                                          63          110
    Total current assets                                14,309        9,830
    Property, plant and equipment, net of
    accumulated depreciation and amortization              462          420
    Other non-current assets:
    Funds in respect of employees rights upon
    retirement                                             282          215
    Deferred debt issuance costs                           961
    Total other non-current assets                       1,243          215
    Total assets                                       $16,014      $10,465

                                                  June 30,                 December 31,
    LIABILITIES AND EQUITY                            2012                       2011
    Current liabilities:
    Current maturities of
    long-term loans                                    $-                        $94
    Accounts payable and
    Trade                                             441                        814
    Other                                           2,925                      2,217
    Advanced payment from
    customers                                         174                        316
    Deferred revenues                                  10
    Total current liabilities                       3,550                      3,441
    Long-term liabilities:
    Liability for employees
    rights upon retirement                            354                        270
    Convertible loans                               5,018
    Contingently redeemable
    warrants                                        1,706
    Total long-term
    liabilities                                     7,078                        270
    Commitments and contingent
    liabilities -
    Total liabilities                              10,628                      3,711
    Common stock, par value
    $0.0001 per share;
    authorized; 68,178,946
    shares issued and
    outstanding at March 31,
    2012 and December 31,
    2011.                                               7                          7
    Additional paid-in capital                     49,101                     43,388
    Accumulated deficit                           -43,722                    -36,641
    Total equity                                    5,386                      6,754
    Total liabilities and
    equity                                        $16,014                    $10,465

    (1) All 2012 financial information is derived from the Company's 2012
    unaudited financial statements and all 2011 financial information is derived
    from the Company's 2011 unaudited financial statements, as disclosed in the
    Company's Quarterly Report on Form 10-Q, filed with the Securities and
    Exchange Commission.
    (2) All 2012 financial information is derived from the Company's 2012
    unaudited financial statements and all 2011 financial information is derived
    from the Company's 2011 audited financial statements, as disclosed in the
    Company's Annual Report on Form 10-K, filed with the Securities and Exchange

About InspireMD, Inc.

InspireMD is a medical device company focusing on the development and commercialization of its proprietary stent system technology, MGuard. InspireMD intends to pursue applications of this technology in coronary, carotid and peripheral artery procedures. InspireMD's common stock is listed on the OTC BB under the ticker symbol "NSPR".

About MGuard™ Coronary Stent

MGuard™ combines a coronary stent merged with an embolic protection specifically designed for acute MI patients. The embolic protection is comprised of an ultra-thin polymer micron net that is integrated with the stent. The MGuard™ is designed to provide outstanding and lifelong embolic protection, without affecting deliverability. MGuard™ is CE Mark approved.

Forward-looking Statements:

This press release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) market acceptance of our existing and new products, (ii) negative clinical trial results or lengthy product delays in key markets, (iii) an inability to secure regulatory approvals for the sale of our products, (iv) intense competition in the medical device industry from much larger, multi-national companies, (v) product liability claims, (vi) our limited manufacturing capabilities and reliance on subcontractors for assistance, (vii) insufficient or inadequate reimbursement by governmental and other third party payers for our products, (viii) our efforts to successfully obtain and maintain intellectual property protection covering our products, which may not be successful, (ix) legislative or regulatory reform of the healthcare system in both the U.S. and foreign jurisdictions, (x) our reliance on single suppliers for certain product components, (xi) the fact that we will need to raise additional capital to meet our business requirements in the future and that such capital raising may be costly, dilutive or difficult to obtain and (xii) the fact that we conduct business in multiple foreign jurisdictions, exposing us to foreign currency exchange rate fluctuations, logistical and communications challenges, burdens and costs of compliance with foreign laws and political and economic instability in each jurisdiction. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K, Transition Report on From 10-K/T and its Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC's web site at The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.


For additional information:
InspireMD Desk at:
Redington, Inc.

SOURCE InspireMD, Inc