Nevro Corp. (NYSE: NVRO), a medical device company that has developed and commercialized an innovative, evidence-based neuromodulation platform for the treatment of chronic pain, today reported financial results for the three months ended March 31, 2015.
Recent Accomplishments & Highlights:
- Revenue of $9.7 million in the first quarter of 2015, an increase of 45% as reported and 70% on a constant currency basis over the same period of the prior year
- On May 8, 2015, received Premarket Approval (PMA) from the U.S. Food and Drug Administration (FDA) for the Senza Spinal Cord Stimulation (SCS) system
- HF10 therapy labeled as superior to traditional SCS therapy for chronic back and leg pain
- HF10 therapy is the only SCS therapy indicated by FDA to deliver pain relief without paresthesia (a constant tingling sensation that is the basis of traditional SCS therapy)
- Clinical trial investigators scheduled to present 18-month Senza RCT results at International Neuromodulation Society (INS) 12th World Congress in Montreal in June 2015
- Senza RCT 18-month results selected as 2015 "Best Clinical Abstract" at the International Spine Intervention Society in Las Vegas in July 2015
"I am pleased that adoption of HF10 therapy has continued at a strong pace in the first quarter in European Union and Australian markets," said Michael DeMane, Chairman and CEO of Nevro. "As a result, more patients in need are afforded the benefits of Nevro's best-in-class spinal cord stimulation technology. Now, with PMA approval and the first FDA SCS superiority label, these meaningful patient benefits will for the first time be made available to U.S. chronic pain patients."
First Quarter Financial Results
Revenue for the three months ended March 31, 2015 was $9.7 million versus $6.7 million during the same period of the prior year, representing 45% growth as reported, or 70% growth on a constant currency basis. The net revenue increase was primarily attributable to continued adoption of the Senza system.
Gross profit for the three months ended March 31, 2015 was $5.8 million, representing a 60% gross margin, up from $3.7 million, representing a 55% gross margin, in the same period of the prior year. Product costs as a percent of revenue decreased as average cost per unit benefited from economies of scale with higher unit volumes compared to the same period last year. While revenues were negatively impacted by the appreciation of the U.S. dollar, costs were primarily incurred in U.S. dollars, which negatively impacted the overall gross margin for the period.
Operating expenses for the three months ended March 31, 2015 were $18.1 million, an increase of 66% compared to $10.9 million in the same period of the prior year. The increase in operating expenses was driven primarily by increased headcount and related personnel costs for the sales and marketing organization in preparation for the U.S. commercial launch as well as an increase in general and administrative costs associated with being a public company.
Loss from operations for the first quarter of 2015 was $12.3 million, compared to $7.2 million for the same period of the prior year.
Guidance for Full Year 2015
The company is reiterating its previously issued guidance, estimating international revenue for the full year 2015 to be in the range of $36 to $38 million, which represents an increase from 2014 in the range of 10.5% to 16.7% on a reported basis, and the range of 25.8% to 32.8% using foreign exchange rates from the first quarter of 2015.