Axogen, Inc. Reports 2023 Third Quarter

 Axogen, Inc. (NASDAQ: AXGN), a global leader in developing and marketing innovative surgical solutions for peripheral nerve injuries, today reported financial results and business highlights for the third quarter ended September 30, 2023.

Third Quarter Financial Results

• Revenue was $41.3 million during the third quarter, an increase of approximately 12% over the third quarter of 2022.
• The Company estimates that revenues from emergent trauma procedures represented approximately half of total revenues during the third quarter and grew in the mid-single digit range versus the third quarter of 2022.
• The Company estimates that revenues from scheduled non-trauma procedures represented approximately half of total revenues during the third quarter and grew approximately 20% from the third quarter of 2022.
• Gross margin was 80.5% for the quarter, compared to 83.3% in the third quarter of 2022.
• Net loss of $4.1 million, or $0.10 per share, compared to net loss of $4.3 million, or $0.10 per share in the third quarter of 2022.
• Adjusted net income of $0.7 million or $0.01 per share, compared to adjusted net loss of $0.4 million, or $0.01 per share, in the third quarter of 2022.
• Adjusted EBITDA of $2.4 million, compared to adjusted EBITDA of $0.4 million in the third quarter of 2022.
• The balance of all cash and cash equivalents and investments on September 30, 2023, was $38.6 million, compared to $40.8 million on June 30, 2023. The net change of $2.2 million includes interest and other charges capitalized into the Company's new processing facility.

“We are pleased with our performance in the quarter, which includes improvement in our emergent trauma category as well as continued strength in scheduled procedures. This performance was driven by stabilization in the hospital operating environment, and improved commercial execution,” stated Karen Zaderej, Axogen's Chairman, CEO, and President. “We remain focused on executing our strategic initiatives anchored in the strength of our clinical data, innovation, market development, and commercial execution to continue to drive surgeon adoption and growth.”

Operational and Business Highlights

• In August, the Company began processing tissue in the new, state-of-the-art APC facility, which provides for up to 3 times current capacity and was designed for long-term growth and expansion.
• The Company is continuing to expand its offering in the nerve protection market with the national launch of Axoguard HA+ Nerve Protector™ in August, and expects to launch Avive+ Soft Tissue Matrix™ in Q1 2024.
• The Company continues to anticipate a Pre-BLA meeting with the FDA in early first quarter 2024 where it will request utilization of a rolling submission process for the Biologics License Application (BLA) for Avance^® nerve graft which would begin later in the first quarter. The Company anticipates completing the submission in the second quarter of 2024 and believes this process will support BLA approval in the first half of 2025.
• The Company has exceeded its initial goal of training 20 additional surgical teams on techniques in implant-based Resensation^® and now expects to have more than 30 teams trained by the end of this year.
• Core Accounts totaled 372, an increase of 12% over prior-year level of 331, and an increase of 7% sequentially. Revenue from Core Accounts now represent approximately 65% of revenue, up from approximately 60% in prior quarters.
• Active Accounts totaled 1016, an increase of 7% over prior-year level of 952, and an increase of 4% sequentially.
• Ended the quarter with over 200 peer-reviewed clinical publications featuring Axogen’s nerve repair product portfolio.
• Ended the quarter with 116 direct sales representatives compared to 115 on June 30, 2023, and 111 a year ago.

2023 Financial Guidance

Management is maintaining full-year 2023 revenue guidance in the range of $154 million to $159 million, which represents annual growth of 11% - 15%. The Company anticipates that gross margin will be reduced with the continued transition to the new processing facility in the fourth quarter and continues to expect that gross margin for the full year 2023 will be approximately 80%.

Axoguard HA+ Nerve Protector Launch

In August 2023, the Company completed the full market release of Axoguard HA+ Nerve Protector™, an extension of its nerve protection platform. Axoguard HA+ Nerve Protector is a proprietary nerve protection device designed to provide short- and long-term protection for peripheral nerve injuries. The device is comprised of a processed porcine submucosa extracellular matrix (ECM) base layer with a hyaluronate-alginate gel coating. The gel layer facilitates enhanced nerve gliding to aid in minimizing soft tissue attachments, while the base layer is remodeled into a long-term protective tissue layer. It is available in a variety of sizes to meet patients' and surgeons’ needs.

Conference Call

The Company will host a conference call and webcast for the investment community today at 8:00 a.m. ET. Investors interested in participating in the conference call by phone may do so by dialing toll free at (877) 407-0993 or using the direct dial-in number at (201) 689-8795. Those interested in listening to the conference call live via the Internet may do so by visiting the Investors page of the Company's website at www.axogeninc.com and clicking on the webcast link.

Following the conference call, a replay will be available in the Investors section of the Company's website at www.axogeninc.com under Investors.

https://www.biospace.com/article/releases/axogen-inc-reports-2023-third-quarter-financial-results/