Bioretec Ltd’s half-year report January–June 2024: RemeOs™ trauma screw controlled launch in the U.S. yielded expected positive clinical results

Bioretec Ltd  Company announcement 15 August 2024 at 8:00 a.m.

This announcement is a summary of Bioretec Ltd’s half-year report January–June 2024. The complete half-year report with tables is attached to this release as a pdf file and available at the company’s web pages at https://bioretec.com/investors/investors-in-english/releases.

 

April–June 2024 in brief

• Net sales increased by 68% and amounted to EUR 1,379 thousand (4–6/2023: EUR 820 thousand).
• Sales margin (excl. other income) was EUR 1,033 (609) thousand, or 74.9% (74.3%) of net sales.
• Profit (loss) for the reporting period was EUR -787 (-1,518) thousand. The comparison period included the cost of financing arrangement amounting to EUR 795 thousand.

 

January–June 2024 in brief

• Net sales amounted to EUR 2,061 thousand (1–6/2023: EUR 1,891 thousand).
• Sales margin (excl. other income) was EUR 1,451 (1,327) thousand or 70.4% (70.2%) of net sales. The sales margin in January–June 2024 includes other income of EUR 72 (0) thousand accrued relating to a Business Finland grant.
• Profit (loss) for the reporting period was EUR -1,884 (-2,075) thousand.
• Earnings per share (undiluted) were EUR -0.09 (-0.11).

 

Key figures

 

EUR 1,000	4–6/2024	4–6/2023	Change, %	1–6/2024	1–6/2023	Change, %	1–12/2023
Net sales	1,379	820	68.3%	2,061	1,891	9.0%	3,906
Sales margin	1,045	609	71.6%	1,523	1,327	14.8%	2,810
Sales margin (excl. other income)	1,033	609	69.8%	1,451	1,327	9.4%	2,728
Sales margin, % of net sales	75.7	74.3		73.9%	70.2%		71.9%
Sales margin% (excl. other income)	74.9	74.3		70.4%	70.2%		69.8%
EBITDA	-752	-639	17.8%	-1,864	-1,130	65.0%	-2,833
EBIT	-782	-690	13.4%	-1,921	-1,233	55.8%	-3,034
Profit/-loss for the period (+/-)	-787	-1,518	-48.2%	-1,884	-2,075	-9.2%	-3,789
R&D spend on total costs, %	23.9%	33.5%		24.8%	29.2%		25.6%
Equity ratio, %	77.9%	85.6%		77.9%	85.6%		77.3%
Cash and cash equivalents at the end of the period	3,947	9,196	-57.1%	3,947	9,196	-57.1%	6,910
Earnings per share (undiluted)	-0.04	-0.07		-0.09	-0.11		-0.19
Earnings per share (diluted)	-0.04	-0.06		-0.08	-0.09		-0.15
Shares at end of period (undiluted)	20,336, 858	19,136, 858		20,336, 858	19,136, 858		19,536, 858
Shares at end of period (diluted)	24,908, 133	23,908, 133		24,908, 133	23,908, 133		24,908, 133
Personnel at end of period	43	30	43.3%	43	30	43.3%	37

 

Key events in April–June 2024

 

• In May, Alan Donze was appointed Bioretec’s CEO.
• In June, Frank Sarcone was appointed as Vice President of Sales for the US and a member of the Management team.
• Also in June, Bioretec communicated positive clinical outcomes from the controlled launch of RemeOs™ trauma screw.
• European market authorization application for the RemeOsTM trauma screw returned from expert panel evaluation in June and the market authorization is expected later compared to earlier estimate (Q2/2024).

 

Alan Donze, CEO of Bioretec Ltd:

 

”Bioretec’s controlled launch plan was designed to systematically gather surgeon feedback and clinical evidence from selected hospitals. In the first half of the year, we received invaluable positive feedback from surgeons regarding the user experience. More importantly, all treated patients experienced the expected healing outcomes, which will facilitate expansion outside the controlled launch plan centers. Our research and development efforts have been focused on expanding the RemeOs™ product portfolio in the U.S. Notably, the FDA granted another Breakthrough Device designation to Bioretec for the RemeOs™ Spinal Cage, an osteopromotive and absorbable cervical spine interbody device made from patented hybrid composite. After my first weeks as the CEO of Bioretec, I am very excited about the opportunities presented by the RemeOs™ product line, which we are actively expanding.

 

The controlled launch of the RemeOs™ trauma screw has proceeded as expected. All surgical procedures using RemeOs™ technology in the U.S. have been successful, with all cases achieving fracture healing and no adverse events or complications during the follow-up period. With these expected positive outcomes and feedback from surgeons, we are preparing to enter the next phase of the launch in the U.S. This phase will involve expanding the distribution of the trauma screw from a selected group of hospitals to a broader network. With the recent appointment of a new VP of Sales in the U.S., we have bolstered our management team, positioning us to enhance our commercialization efforts in this market.

 

The strong global performance of the Activa product line marked Bioretec’s second quarter of 2024. Net sales grew by 68% from the first quarter due in part to a planned shutdown for new machinery investments resulting in an expected backlog. Sales in the United States saw significant growth, while in Europe, the increase was primarily driven by robust demand from new distributors. However, net sales in the rest of the world declined due to a slight decrease in demand in China, where governmental volume-based procurement initiatives and other changes affected orders. Our sales margin remained consistent with the previous year, ending at 70.4% (70.2%). As part of our strategic implementation and increased recruitment efforts, operating expenses rose. We hired a sales leader in Germany and Austria in the first half of the year and will initiate direct sales in these markets during the second half of the year.

 

European CE market authorization application for the RemeOs™ trauma screw is progressing, although the process has been extended beyond the prior estimate. The Expert panel review was completed during the second quarter and our application has now returned to the Notified Body for the final steps of the market approval process. The anticipated European market authorization will provide substantial ability to gather real-world evidence of a variety of indications, which will support indication expansions also in the U.S. In other respects, we saw good development with our R&D efforts. I am especially excited about the unprecedented RemeOs™ Spinal Interbody Cage implant, which recently received the FDA Breakthrough Device Designation in the U.S. market. We will be evaluating our resource needs required for bringing it to the market, together with the other RemeOs™ products in the pipeline.

 

As we focused on ramping up our production capacity in the first half of the year, we anticipate that our net sales will be more robust in the second half. Expanding production capacity and investing in U.S. market development are crucial components of building our growth platform. We continue with our efforts to introduce more RemeOs™ products to the market incrementally through the US FDA process.”

 

Financial reporting in 2024

 

In 2024, Bioretec will publish the following financial reports:

 

• business review for January–September 2024 on Thursday 14 November 2024

 

The releases will be available online at Bioretec Ltd’s website at

https://bioretec.com/investors/investors-in-english/reports-and-presentations.

 

 

Tampere, 15 August 2024

 

Board of Directors

Bioretec Ltd

 

Further inquiries:

 

Alan Donze    Johanna Salko

CEO     CFO

+358 40 663 5011   +358 40 754 8172

[email protected]  [email protected]

 

Certified advisor:

Nordic Certified Adviser AB, p. +46 70 551 6729

 

Information about Bioretec

 

Bioretec is a globally operating Finnish medical device company that continues to pioneer the application of biodegradable orthopedic implants. The company has built unique competencies in the biological interface of active implants to enhance bone growth and accelerate fracture healing after orthopedic surgery. The products developed and manufactured by Bioretec are used worldwide in approximately 40 countries. 

 

Bioretec is developing the new RemeOs™ product line based on a magnesium alloy and hybrid composite, introducing a new generation of strong biodegradable materials for enhanced surgical outcomes. The RemeOs™ implants are absorbed and replaced by bone, which eliminates the need for removal surgery while facilitating fracture healing. The combination has the potential to make titanium implants redundant and help clinics reach their Value-Based Healthcare targets while focusing on value for patients through efficient healthcare. The first RemeOs™ product market authorization has been received in the U.S. in March 2023, and in Europe, the CE mark approval process is currently on-going. Bioretec is positioning itself to enter the addressable over USD 7 billion global orthopedic trauma market and to become a game changer in surgical bone fracture treatment.

 

Better healing – Better life. www.bioretec.com

 

Appendix

Bioretec Ltd’s half year report January–June 2024 (pdf)