Conceptus Reports Third Quarter Financial Results; FDA Approves Essure, Company Prepares for U.S. Market Launch.Business Editors & Health/Medical Writers SAN CARLOS San Carlos (săn kär`lōs), residential city (1990 pop. 26,167), San Mateo co., W Calif.; inc. 1925. The chief manufactures are plastic products, hardware, and machine parts. , Calif.--(BUSINESS WIRE)--Nov. 4, 2002 Conceptus conceptus /con·cep·tus/ (-tus) the product of the union of oocyte and spermatozoon at any stage of development from fertilization until birth, including extraembryonic membranes as well as the embryo or fetus. , Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CPTS CPTS Certified Penetration Testing Specialist (network security) CPTS Comptroller Squadron CPTS Computer Program Test Specifications CPTS Catastrophe Personnel Tracking System CPTS Claims Procedure Training Specialist ), developer of the non-incisional permanent birth control procedure Essure(TM), today announced financial results for the three and nine months ended September 30, 2002. Highlights of the 2002 third quarter and subsequent weeks include: -- U.S. Food and Drug Administration (FDA) approves the Company's Pre-market Approval (PMA) application for Essure -- Expansion of the Company's U.S. salesforce and sales-support functions -- Completion of U.S. salesforce training -- Preparations for the physician market introduction of Essure at the American Association of Gynecologic Laparoscopists annual meeting later this month For the third quarter of 2002, Conceptus reported a net loss of $8.1 million, or $0.38 per share, compared with a net loss of $4.5 million, or $0.33 per share, in the comparable period last year. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the third quarter of 2002 were $481,000, up from $123,000 for the third quarter of last year, and up 18% from $406,000 in the second quarter of 2002. For the nine months ended September 30, 2002, the Company reported a net loss of $20.7 million, or $1.14 per share, compared with a net loss of $12.8 million, or $0.99 per share, in the comparable prior-year period. Net sales for the first nine months of 2002 were $1.2 million, compared with $286,000 for the first nine months of 2001. Cost of sales and start-up manufacturing costs, representing the cost of early stage product manufacturing and growing, but limited, production volumes, were $845,000 in the 2002 third quarter, compared with $537,000 in the 2001 third quarter. This declined 5% from $893,000 in the 2002 second quarter. Research and development expenses were $2.2 million for the 2002 third quarter, compared with $2.0 million in the prior-year third quarter. The slight increase reflects continued clinical and regulatory affairs Regulatory Affairs (RA), also called Government Affairs, is a profession within regulated industries, such as pharmaceuticals, medical devices, energy, and banking. Regulatory Affairs professionals usually have responsibility for the following general areas: n a system of epidemiologic scoring of periodontal disease devised by Schour and Massler in which the symbols denote the areas involved in gingival inflammation. PMA Progressive muscular atrophy with the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. . Selling, general and administrative expenses were approximately $6.0 million for the three months ended September 30, 2002, compared with $2.2 million last year. The increase was primarily related to the Company's hiring and training of sales, professional education and strategic reimbursement personnel in preparation for marketing Essure in the U.S. Cash, cash equivalents, short-term investments and restricted cash were $80.6 million as of September 30, 2002, compared with $33.8 million as of December 31, 2001, reflecting the successful completion in June 2002 of a follow-on public equity offering. "The strong focus for Conceptus during the third quarter was preparing for FDA approval of Essure and the subsequent market introduction of our product into the world's most important market," commented Steve Bacich, president and chief executive officer. "In our critical U.S. sales function, we have hired and trained 20 direct salespeople, each with an average of more than 12 years of medical device sales experience. These professionals will be managed by two experienced area sales directors. Our professional education department, for which we have hired nine field trainers to date, will support this high-caliber sales group, with additional support from contract field trainers. Over the past two months, our sales representatives and field trainers have been gaining Essure procedural experience in Canada and Australia. In addition, in preparation for U.S. market launch, we are redeploying our sales and training resources from Australia to the U.S." Noting that reimbursement is a vital component of the Company's sales strategy, Mr. Bacich commented that Conceptus has also hired three reimbursement professionals, experienced in managing both strategic and operational reimbursement issues for new medical products. "We are looking forward to our formal introduction of Essure at the annual meeting of the American Association American Association refers to one of the following professional baseball leagues:
Conceptus has scheduled an investor conference call to discuss this announcement beginning at 4:30 p.m. Eastern Time today. Individuals interested in listening to the live conference call via the Internet may do so by logging on to the Company's Website, www.conceptus.com. A replay will be available on the Website for 30 days. About Essure Essure deploys a soft micro-insert into the fallopian tube fallopian tube (fəlō`pēən), either of a pair of tubes extending from the uterus to the paired ovaries in the human female, also called oviducts, technically known as the uterine tube. through the cervix cervix /cer·vix/ (ser´viks) pl. cer´vices [L.] 1. neck. 2. the front portion of the neck. 3. cervix uteri. using a minimally invasive transcervical tubal Tubal (t  `bəl), in the Bible, son of Japheth. access
catheter. Once in place, the device is designed to elicit tissue growth
in and around the micro-insert to form an occlusion occlusion /oc·clu·sion/ (o-kloo´zhun)1. obstruction. 2. the trapping of a liquid or gas within cavities in a solid or on its surface. 3. or blockage in the fallopian tube. An Essure procedure does not require cutting or penetrating the abdomen and can be performed in a less costly procedure setting without general anesthesia Anesthesia, General Definition General anesthesia is the induction of a state of unconsciousness with the absence of pain sensation over the entire body, through the administration of anesthetic drugs. . A woman is expected to return home about 45 minutes after the procedure is completed. About Conceptus Conceptus, Inc. is developing Essure, which is designed to provide a non-incisional alternative to tubal ligation ligation /li·ga·tion/ (li-ga´shun) the application of a ligature. tubal ligation sterilization of the female by constricting, severing, or crushing the uterine tubes. , the leading form of birth control worldwide. The availability of Essure in the U.S. is expected to open up a market currently occupied by surgical tubal ligation and vasectomy vasectomy, male sterilization by surgical excision of the vas deferens, the thin duct that carries sperm cells from the testicles to the prostate and the penis. , which combined account for over 1 million procedures annually in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Additional information about Conceptus and the Essure procedure is available at www.conceptus.com. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements, the accuracy of which is necessarily subject to risks and uncertainties. The receipt and timing of, and conditions placed upon, regulatory approvals for Essure, and clinical efficacy of and market demand for our product, among other matters discussed in this release, may differ significantly from the discussion of such matters in the forward-looking statements. Such differences may be based upon factors within the Company's control, such as strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. decisions by management and re-allocation of internal resources, or on factors outside of the Company's control, such as delays by regulatory authorities, scientific advances by third parties and introduction of competitive products, as well as those factors set forth in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2001 and other filings with the Securities and Exchange Commission.
Conceptus, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
Three Months Nine Months
Ended Ended
September 30, September 30,
2002 2001 2002 2001
Net sales $481 $123 $1,185 $286
Operating costs and expenses:
Cost of sales and start-up
manufacturing costs 845 537 2,484 1,183
Research and development 2,170 1,953 6,500 5,818
Selling, general and
administrative 5,972 2,234 13,207 6,631
Total operating costs and
expenses 8,987 4,724 22,191 13,632
Operating loss (8,506) (4,601) (21,006) (13,346)
Interest and other income, net 359 143 347 545
Net loss $(8,147) $(4,458) $(20,659) $(12,801)
Basic and diluted net loss per
share $(0.38) $(0.33) $(1.14) $(0.99)
Shares used in computing basic
and diluted net loss per share 21,220 13,712 18,183 12,920
Conceptus, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
September 30, December 31,
2002 2001
Cash, cash equivalents, short-term
investments and restricted cash $80,556 $33,803
Accounts receivable, net 509 247
Inventories, net 1,820 1,134
Other current assets 778 556
Total current assets 83,663 35,740
Property and equipment, net 2,380 1,658
Other assets 415 380
Total assets $86,458 $37,778
Total liabilities $4,240 $4,603
Common stock and additional paid-in
capital 188,101 118,397
Accumulated other comprehensive loss (2) --
Accumulated deficit (105,881) (85,222)
Total stockholders' equity 82,218 33,175
Total liabilities and stockholders'
equity $86,458 $37,778
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