SOLANA BEACH, Calif., Nov. 09, 2023 (GLOBE NEWSWIRE) -- ClearPoint Neuro, Inc. (Nasdaq: CLPT) (the “Company”), a global therapy-enabling platform company providing navigation and delivery to the brain, today announced financial results for its third quarter ended September 30, 2023.

Third Quarter Highlights

• Reported quarterly revenue of $5.8 million, a 12% year-over-year increase;
• Increased biologics and drug delivery revenue to $3.5 million, a 55% year-over-year increase;
• Operational cash burn of $1.8 million, the lowest quarterly burn since 2020;
• Entered into new strategic biologics and drug delivery agreements, including additional milestone-based agreement;
• Submitted three new stereotactic products to the FDA for 510(k) clearance;
• Submitted one 510(k) clearance to the FDA for updated software that allows the ClearPoint Navigation Software to incorporate the Maestro Brain Model;
• Completed the transition to the new manufacturing facility in Carlsbad, California, which is now producing and shipping sellable product to customers;
• Cash and cash equivalents totaled $24.3 million as of September 30, 2023.

Business Outlook

• With additional focus on near-term investments that drive profitable growth, the company now forecasts 2023 total revenue between $23.0 and $25.0 million representing growth between 11% and 18% for the year.

“The third quarter was productive for the team as we continued to grow double digits while meaningfully reducing our operational cash burn,” commented Joe Burnett, President and CEO at ClearPoint Neuro. “We believe that our long-term vision and strategy remain unchanged, however we are committed to focusing our near-term activities on profitable growth as our third quarter demonstrated. Despite reducing our quarterly operational cash burn to the lowest level since 2020, we were still able to execute multiple new strategic biologics and drug delivery agreements, expand our PRISM laser therapy system to new centers, execute multiple new product FDA submissions, and complete the transition of manufacturing to our new facility in Carlsbad, California ahead of schedule, improving gross margin and eliminating redundant costs heading into 2024.”

Financial Results – Quarter Ended September 30, 2023

Total revenue was $5.8 million for the three months ended September 30, 2023, and $5.1 million for the three months ended September 30, 2022, which represents an increase of $0.6 million, or 12%.

Biologics and drug delivery revenue, which includes sales of disposable products and services related to customer-sponsored pre-clinical and clinical trials utilizing our products, increased 55% to $3.5 million for the three months ended September 30, 2023, from $2.2 million for the same period in 2022.

Functional neurosurgery navigation and therapy revenue, decreased 21% to $1.9 million for the three months ended September 30, 2023, from $2.4 million for the same period in 2022. The decrease is driven primarily by lower service revenue of $0.3 million as a result of pausing a co-development program with one of our Brain Computer Interface partners.

Capital equipment and software revenue, consisting of sales of ClearPoint reusable hardware and software, and of related services, decreased 26% to $0.4 million for the three months ended September 30, 2023, from $0.5 million for the same period in 2022.

Gross margin for the three months ended September 30, 2023, was 57%, as compared to a gross margin of 71% for the three months ended September 30, 2022. The decrease in gross margin was primarily due to an increase in biologics and drug delivery preclinical services, which, to date, have had a lower margin than prior year as we launch new services and increase our presence in this space. Increased costs related to the transition to the new manufacturing facility have also contributed to the decrease in gross margin compared to prior year.

Operating expenses for the third quarter of 2023 were $8.2 million, compared to $7.5 million for the third quarter of 2022. The increase was mainly driven by the increase in headcount across the organization and share-based compensation as well as an increase in the allowance for credit losses, offset slightly by lower research and development costs.

At September 30, 2023, the Company had cash and cash equivalents and short-term investments totaling $24.3 million as compared to $37.5 million at December 31, 2022, with the decrease resulting primarily from the use of cash in operating activities of $12.6 million.

Teleconference Information

Investors and analysts are invited to listen to a live broadcast review of the Company’s 2023 third quarter on Thursday, November 9, 2023 at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) which may be accessed online here: https://event.choruscall.com/mediaframe/webcast.html?webcastid=dhaAzhXA. Investors and analysts who would like to participate in the conference call via telephone may do so at (800) 715-9871, or at (646) 307-1963 if calling from outside the U.S. or Canada.

For those who cannot access the live broadcast, a replay will be available shortly after the completion of the call until December 9, 2023, by calling (877) 660-6853, or (201) 612-7415 if calling from outside the U.S. or Canada, and then entering conference I.D. number 413671. An online archive of the broadcast will be available on the Company’s Investor website at https://ir.clearpointneuro.com/.

About ClearPoint Neuro

ClearPoint Neuro’s mission is to improve and restore quality of life to patients and their families by enabling therapies for the most complex neurological disorders with pinpoint accuracy. Applications of the Company’s current product portfolio include deep brain stimulation, laser ablation, biopsy, and delivery of drugs, biologics, and gene therapy to the brain. The ClearPoint Neuro Navigation System has FDA clearance, is CE-marked, and is installed in over 65 sites in North America, Europe, and South America. ClearPoint Neuro is partnered with more than 50 pharmaceutical/biotech companies, academic centers, and contract research organizations providing solutions for direct CNS delivery of therapeutics in pre-clinical studies and clinical trials worldwide. To date, more than 6,000 procedures have been performed and supported by the Company’s field-based clinical specialist team, which offers support and services to our customers and partners worldwide. For more information, please visit www.clearpointneuro.com.

Forward-Looking Statements

Statements in this press release and in the teleconference referenced above concerning the Company’s plans, growth and strategies may include forward-looking statements within the context of the federal securities laws. Statements regarding the Company’s future events, developments and future performance, the size of total addressable markets or the market opportunity for the Company’s products and services, as well as management’s expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. Uncertainties and risks may cause the Company’s actual results to differ materially from those expressed in or implied by forward-looking statements. Particular uncertainties and risks include those relating to: the impact of macroeconomic and inflationary conditions, global instability, supply chain disruptions, and labor shortages; future revenue from sales of the Company’s hardware and software products and biologics and drug delivery consulting services; the Company’s ability to market, commercialize and achieve broader market acceptance for the Company’s hardware and software products and service offerings, including our biologics and drug delivery partners’ use of our products and services in their delivery of therapies; our biologics and drug delivery partners’ ability to fund their business activities, conduct further research and development, and achieve success in their studies and clinical trials; and risks inherent in the research and development and regulatory approval of new products. More detailed information on these and additional factors that could affect the Company’s actual results are described in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, and the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2023, both of which have been filed with the Securities and Exchange Commission, and the Company’s Quarterly Report on Form 10-Q for the three months ended September 30, 2023, which the Company intends to file with the Securities and Exchange Commission on or before November 14, 2023.