tmdx-8k_20220223.htm
false 0001756262 0001756262 2022-02-23 2022-02-23

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): February 23, 2022

TransMedics Group, Inc.

(Exact Name of Registrant as Specified in Charter)

Massachusetts

 

001-38891

 

83-2181531

(State or Other Jurisdiction of Incorporation)

 

(Commission File Number)

 

(I.R.S. Employer Identification No.)

200 Minuteman Road

Andover, Massachusetts 01810

(Address of Principal Executive Offices, and Zip Code)

(978) 552-0900

Registrant’s Telephone Number, Including Area Code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which
registered

Common Stock, no par value per share

 

TMDX

 

The Nasdaq Stock Market LLC

(The Nasdaq Global Market)

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


 


 

Item 2.02. Results of Operations and Financial Condition.

On February 23, 2022, TransMedics Group, Inc. (the “Company”) issued a press release announcing the Company’s financial results for the quarter and year ended December 31, 2021. A copy of this press release is furnished as Exhibit 99.1 and is incorporated herein by reference.

The information in this Form 8-K (including Exhibit 99.1 attached hereto) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing by the Company, under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit
No.

 

Description

 

 

99.1

 

Press release issued by TransMedics Group, Inc. on February 23, 2022

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 


 


 

 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

TRANSMEDICS GROUP, INC.

 

 

 

Date: February 23, 2022

 

By:

 

/s/ Stephen Gordon

 

 

 

 

Name: Stephen Gordon

 

 

 

 

Title: Chief Financial Officer, Treasurer and Secretary

 

 

tmdx-ex991_6.htm

Exhibit 99.1

TransMedics Reports Fourth Quarter and Full Year 2021 Financial Results

 

Andover, Mass. – February 23, 2022 – TransMedics Group, Inc. (“TransMedics”) (Nasdaq: TMDX), a medical technology company that is transforming organ transplant therapy for patients with end-stage lung, heart, and liver failure, today reported financial results for the quarter and year ended December 31, 2021.

 

Recent Highlights

 

Net revenue of $9.7 million in the fourth quarter of 2021, a 27% increase compared to the fourth quarter of 2020

 

Net revenue of $30.3 million in the full year 2021, an 18% increase compared to the full year of 2020

 

Launched commercialization of OCS™ Heart and OCS™ Liver in the U.S

 

Results of OCS™ Liver PROTECT trial published in JAMA Surgery in January 2022

 

“2021 was a great year for TransMedics as we delivered on each key regulatory milestone we had hoped to achieve in 2021 and our goal of having the OCS platform commercially available in the U.S. across lung, heart and liver transplant markets by year end,” said Waleed Hassanein, MD, President and Chief Executive Officer. “We ended 2021 well positioned to execute and we are confident that 2022 will be a transformative year of growth for TransMedics as we expand our National OCS Program to drive clinical adoption across all three transplant markets and capitalize on our unparalleled technology.”

 

Fourth Quarter 2021 Financial Results

Net revenue for the fourth quarter of 2021 was $9.7 million, a 27% increase compared to $7.6 million in the fourth quarter of 2020. The increase was due primarily to the commercial launch of the OCS Heart and OCS Liver in the United States.

 

Gross margin for the fourth quarter of 2021 was 72% as compared to 63% in the fourth quarter of 2020.

 

Operating expenses for the fourth quarter of 2021 were $18.3 million compared to $10.7 million in the fourth quarter of 2020. The increase in operating expense was driven by our increased investment in the company’s National OCS Program, which is a comprehensive organ retrieval and management service, as well as commercialization and infrastructure throughout the company.  Fourth quarter operating expenses in 2021 included $2.0 million of stock compensation expense compared to $0.7 million of stock compensation in the fourth quarter of 2020.

 

Net loss for the fourth quarter of 2021 was $12.7 million compared to $6.3 million in the fourth quarter of 2020.

 


 

Full Year 2021 Financial Results

Net revenue for the full year of 2021 was $30.3 million, a 18% increase compared to $25.6 million in the full year of 2020. The increase was due primarily to commercial expansion across OCS products including initial commercialization of the OCS Heart and OCS Liver in the United States.

 

Gross margin for the full year of 2021 was 70% as compared to 65% in the full year of 2020.

 

Operating expenses for the full year of 2021 were $60.6 million compared to $43.0 million in the full year of 2020. The increase in operating expense was driven by increased investment in the company’s National OCS Program investment, spending related to the two FDA panels in the year, and commercialization and infrastructure throughout the company. Full year 2021 operating expenses included $6.8 million of stock compensation expense compared to $2.4 million in 2020.

 

Net loss for the full year of 2021 was $44.2 million compared to $28.7 million in the full year of 2020.

 

Cash, cash equivalents and marketable securities were $92.5 million as of December 31, 2021.

 

2022 Financial Outlook

TransMedics expects net revenue for the full-year 2022 to be in the range of $49 million to $55 million, which represents 62% to 82% growth compared to the company’s prior year net revenue.

 

Webcast and Conference Call Details

The TransMedics management team will host a conference call beginning at 4:30 p.m. ET / 1:30 p.m. PT on Wednesday, February 23, 2021. Investors interested in listening to the conference call may do so by dialing (833) 378-1026 for domestic callers or (236) 712-2500 for international callers, followed by Conference ID: 9789660. A live and archived webcast of the event will be available on the “Investors” section of the TransMedics website at www.transmedics.com.  

 

About TransMedics Group, Inc.

TransMedics is the world’s leader in portable extracorporeal warm perfusion and assessment of donor organs for transplantation. Headquartered in Andover, Massachusetts, the company was founded to address the unmet need for more and better organs for transplantation and has developed technologies to preserve organ quality, assess organ viability prior to transplant, and potentially increase the utilization of donor organs for the treatment of end-stage heart, lung, and liver failure.

 

Forward-Looking Statements

This press release contains forward-looking statements with respect to, among other things, our operations and financial. These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Moreover, we operate in a very competitive and rapidly changing environment and new risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in or implied by any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this


press release may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Some of the key factors that could cause actual results to differ include: that we continue to incur losses; our need to raise additional funding; our existing and any future indebtedness, including our ability to comply with affirmative and negative covenants under our credit agreement to which we will remain subject to until maturity, and our ability to obtain additional financing or refinance existing debt on favorable terms or at all; the fluctuation of our financial results from quarter to quarter; our ability to use net operating losses and research and development credit carryforwards; our dependence on the success of the OCS; our ability to expand access to OCS through the National OCS Program; the rate and degree of market acceptance of the OCS; our ability to educate patients, surgeons, transplant centers and private payors of benefits offered by the OCS; our ability to improve the OCS platform; our dependence on a limited number of customers for a significant portion of our net revenue; our ability to maintain regulatory approvals or clearances for our OCS products; our ability to adequately respond to FDA follow-up inquiries in a timely manner; the performance of our third-party suppliers and manufacturers; price increases of the components of our products; the timing or results of post-approval studies and any clinical trials for the OCS; our manufacturing, sales, marketing and clinical support capabilities and strategy; attacks against our information technology infrastructure; the economic, political and other risks associated with our foreign operations; our ability to attract and retain key personnel; the impact of the outbreak of COVID-19, including variants of the virus an associated containment, remediation and vaccination efforts; our ability to protect, defend, maintain and enforce our intellectual property rights relating to the OCS and avoid allegations that our products infringe, misappropriate or otherwise violate the intellectual property rights of third parties; the pricing of the OCS, as well as the reimbursement coverage for the OCS in the United States and internationally; regulatory developments in the United States, European Union and other jurisdictions; the extent and success of competing products that are or may become available; the impact of any product recalls or improper use of our products; our estimates regarding revenues, expenses and needs for additional financing; and other factors that may be described in our filings with the Securities and Exchange Commission (the “SEC”). Additional information will be made available by our annual and quarterly reports and other filings that we make from time to time with the SEC. These forward-looking statements speak only as of the date of this press release. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable law.

 

 

Investor Contact:

Brian Johnston

332-895-3222

Investors@transmedics.com



 

TransMedics Group, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(unaudited)

 

 

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net revenue

 

$

9,668

 

 

$

7,627

 

 

$

30,262

 

 

$

25,639

 

Cost of revenue

 

 

2,682

 

 

 

2,799

 

 

 

9,103

 

 

 

9,004

 

Gross profit

 

 

6,986

 

 

 

4,828

 

 

 

21,159

 

 

 

16,635

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin

 

 

72

%

 

 

63

%

 

 

70

%

 

 

65

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research, development and clinical trials

 

 

6,314

 

 

 

4,548

 

 

 

22,304

 

 

 

18,831

 

Selling, general and administrative

 

 

12,000

 

 

 

6,176

 

 

 

38,283

 

 

 

24,188

 

Total operating expenses

 

 

18,314

 

 

 

10,724

 

 

 

60,587

 

 

 

43,019

 

Loss from operations

 

 

(11,328

)

 

 

(5,896

)

 

 

(39,428

)

 

 

(26,384

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(978

)

 

 

(971

)

 

 

(3,874

)

 

 

(3,985

)

Other income

 

 

(345

)

 

 

566

 

 

 

(877

)

 

 

1,653

 

          Total other expense, net

 

 

(1,323

)

 

 

(405

)

 

 

(4,751

)

 

 

(2,332

)

Loss before income taxes

 

 

(12,651

)

 

 

(6,301

)

 

 

(44,179

)

 

 

(28,716

)

Provision for income taxes

 

 

(17

)

 

 

(10

)

 

 

(36

)

 

 

(32

)

Net loss

 

$

(12,668

)

 

$

(6,311

)

 

$

(44,215

)

 

$

(28,748

)

Net loss per share attributable to common

   stockholders, basic and diluted

 

$

(0.46

)

 

$

(0.23

)

 

$

(1.60

)

 

$

(1.16

)

Weighted average common shares outstanding,

   basic and diluted

 

 

27,771,885

 

 

 

27,163,390

 

 

 

27,616,839

 

 

 

24,702,764

 

 

* Reconciliation of Gross to Net revenue for certain payments made to customers (in thousands)

 

 

 

Three Months Ended December 31,

 

 

Year Ended December 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Gross revenue from sales to customers

 

$

9,668

 

 

$

8,217

 

 

$

31,385

 

 

$

28,356

 

Less: clinical trial payments reducing revenue

 

 

 

 

 

590

 

 

 

1,123

 

 

 

2,717

 

          Total net revenue

 

$

9,668

 

 

$

7,627

 

 

$

30,262

 

 

$

25,639

 

 



 

TransMedics Group, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

 

 

 

December 31,

 

 

 

2021

 

 

2020

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

25,580

 

 

$

24,581

 

Marketable securities

 

 

66,872

 

 

 

101,061

 

Accounts receivable

 

 

5,934

 

 

 

6,864

 

Inventory

 

 

14,859

 

 

 

11,934

 

Prepaid expenses and other current assets

 

 

5,460

 

 

 

2,326

 

         Total current assets

 

 

118,705

 

 

 

146,766

 

Property and equipment, net

 

 

9,841

 

 

 

4,754

 

Operating lease right-of-use assets

 

 

5,847

 

 

 

 

Restricted cash and other long-term assets

 

 

500

 

 

 

506

 

        Total assets

 

$

134,893

 

 

$

152,026

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

6,651

 

 

$

1,206

 

Accrued expenses and other current liabilities

 

 

16,337

 

 

 

10,410

 

Deferred revenue

 

 

250

 

 

 

263

 

               Total current liabilities

 

 

23,238

 

 

 

11,879

 

Long-term debt, net of discount

 

 

35,197

 

 

 

34,657

 

Operating lease liabilities, net of current portion

 

 

8,604

 

 

 

 

Other long-term liabilities

 

 

 

 

 

1,599

 

  Total liabilities

 

 

67,039

 

 

 

48,135

 

  Total stockholders' equity

 

 

67,854

 

 

 

103,891

 

      Total liabilities and equity

 

$

134,893

 

 

$

152,026