conference date: November 7, 2012 @ 2:00 PM Pacific Time
for quarter ending: September 30, 2012 (Q3, third quarter 2012)
(at the time this is being written)
Overview: Starting to sell some of the Magellan Robotic Systems, so better than Q2.
Basic data (GAAP) :
Revenue was $5.1 million, up 46% sequentially from $3.5 million, but down 6% from $5.4 million year-earlier.
Net income was negative $8.4 million, improved sequentially from negative $11.5 million and improved from negative $10.1 million year-earlier.
EPS (earnings per share) were negative $0.14, improved sequentially from negative $0.19 and improved from negative $0.18 year-earlier.
Magellan Robotic Vascular System launch continued, with four systems shipping in the quarter. Three of them were part of a commercial evaluation program, where they have been used to perform procedures. Hansen Medical continues to exhibit the systems at conferences. Hansen leaders are pleased with the interest in the Magellan system, and believe medical leaders will encourage further sales.
Five Hansen Robotic Catheter Systems shipped in the quarter, four Magellan and one Sensei. Five systems had recognized revenue in the quarter, one Magellan shipped in the quarter, one Sensei shipped in the quarter, and three Sensei systems from deferred revenue. One Magellan shipped to Europe, the other systems shipped to U.S. customers.
Artisan, Lynx or NorthStar Catheters sold was 689, down 2% sequentially from 704, also down 1% from year-earlier. Magellan catheter sales were not significant as the systems shipped late in the quarter.
Number of EP (electrophysiology) procedures performed was 659, up 3% sequentially from 637 and up almost 10% from year-earlier.
An Agreement was signed with Intuitive Surgical for $20 million for an expanded license and $10 million for 5.3 million shares of HNSN, making Intuitive the third-largest shareholder of Hansen Medical.
Artisan Extended Control Catheter for Sensei used in first U.S. clinical cases.
Cash and equivalents ended at $21.6 million, down sequentially $29.4 million. After the quarter ended received $30 million from an expanded agreement with Intuitive Surgical (ISRG). Debt ended at $29.3 million. Deferred revenue dropped to $3.9 million.
Cost of goods sold was $3.8 million, leaving gross profit of $1.3 million. Operating expense of $8.8 million included $3.8 million for research and development and $5.1 million for selling, general and administrative. Other expense was $0.9 million.
Cases recently performed in U.S. show the versatility of the systems. Vascular surgery, interventional cardiology, and radiation therapy procedures have been demonstrated.
Intuitive Surgical deal? Gives them access to the current IP portfolio plus anything developed over the next three years, but limited by product type. We retain the right to use the IP for all clinical applications, particularly vascular.
Criteria for placing Magellan robots for evaluation? The program is limited in number of systems and in time. They are not obligated to buy, but they are using the robots and we believe they will want to close on the purchases. The trial time varies by account. These also help us generate data.
Any shipments in Q4 under the evaluation program? We are confident about the quarter but will not release results until the conference following the quarter.
$1.5 million insurance reimbursement shows up in reduction of operating expenses.
Accounting for earlier vascular system sales? All of the first three had been previously recognized as revenue. This quarter we recognized one Magellan system.
Pricing of Magellan systems? We feel good about the sales price of the Magellans. Individual deals can be higher or lower depending on the specific deals. We believe the Magellans will command a higher price than Senseis in the future.
Clinical interest has been stronger in the U.S. than in Europe. Partly this is because the U.S. market is larger.
We believe we can reduce costs further in the coming quarters. Yet we can invest more on the commercial side or R&D if we need it.
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