Neurometrix revenue drops

NeuroMetrix, Inc., (Nasdaq: NURO) today reported financial and business highlights for the quarter and year ended December 31, 2019.

The Company develops and commercializes diagnostic and therapeutic neurostimulation-based medical devices. The Company has three commercial products.  DPNCheck^® is a point-of-care diagnostic test for peripheral neuropathies including diabetic peripheral neuropathy (DPN).  ADVANCE™ is a point-of-care diagnostic test primarily used for carpal tunnel syndrome.  Quell^® is a wearable neurostimulation device that is available over-the-counter for symptomatic relief of chronic pain.
Q4 2019 Highlights:

• DPNCheck posted Q4 2019 revenue of $0.9 million, an increase of 51% over the prior year quarter.  The improvement came in the US Medicare Advantage market, which was consistent with strong performance of this segment throughout 2019. In the full year 2019, Medicare Advantage revenue growth was 25% over the prior year.
• The Company made important progress on its second generation DPNCheck system which is planned for commercial launch in Q4 2020.  This product should position the DPNCheck business for long-term revenue growth.
• ADVANCE revenue was $280 thousand in Q4 2019, essentially flat with $300 thousand in the prior year quarter.  The Company has not been actively marketing ADVANCE for the past five years but plans to evaluate renewed R&D and marketing investment given the ongoing market demand.
• Reflecting substantial reductions in 2019 advertising spending, Quell revenue decreased to $0.5 million in Q4 2019 from $2.8 million in the prior year quarter. The Company emphasized sales profitability over volume while further refining the commercial strategy.
• The Company continued to provide engineering support for Quell technology as part of its collaboration with GlaxoSmithKline.
• The Company maintained its investment in the Quell clinical development program which is intended to support ongoing Quell promotion, expand the Quell chronic pain market and identify new clinical applications for Quell technology.  Several clinical program announcements are expected during 2020.
• The Q4 2019 gross margin on product sales was $1.1 million, a 62.2% margin rate which was up 15 percentage points over the prior year quarter. The Q4 2019 net loss of $1.1 million was a 60% improvement over Q4 2018.

“Although we were disappointed by the overall drop in revenue from the year-ago period, we expected this outcome given our large reduction in operating expenses, attention to improved gross margins and overall focus on long term growth and profitability.  We believe we made important progress against these objectives. We experienced strong demand for DPNCheck during the fourth quarter which is typically our slowest period. This momentum should carry into 2020 as new Medicare Advantage accounts come on board and we expect a rebound in international sales.  Our enthusiasm for the DPNCheck business is reflected in our investment in the next generation device to be launched in late 2020,” said Shai N. Gozani, M.D., Ph.D., President and Chief Executive Officer of NeuroMetrix. “Our Quell business is focused on cost-efficient advertising combined with an exclusively direct-to-consumer model via our QuellRelief.com website and exploration of new markets. We believe this technology is unique and represents an attractive long term opportunity for the Company.   Finally, we are actively engaged with the Federal Trade Commission (FTC) to resolve the previously disclosed matter which is centered on earlier Quell advertising.”
https://www.biospace.com/article/releases/neurometrix-reports-q4-and-full-year-2019-financial-results/