Workflow
RA MEDICAL SYSTE(RMED) - 2025 Q1 - Quarterly Report
RMEDRA MEDICAL SYSTE(RMED)2025-05-14 20:16

Product Development and Sales - The VIVO System has been utilized in over 1,000 procedures in the U.S. and EU by more than 30 physicians, with no reported device-related complications[200]. - The company received FDA clearance for the VIVO System as a pre-procedure planning tool for patients with structurally normal hearts undergoing ablation treatment[200]. - LockeT, a new suture retention device, was registered with the FDA in February 2023, with initial shipments to distributors beginning thereafter[202]. - The company recognized its first sale of LockeT in May 2024, following CE Mark approval received in April 2025[202]. - The company aims to establish VIVO as an integral tool for cardiac electrophysiologists, improving procedural success and reducing complications[204]. - LockeT sales increased by 128,000from128,000 from 0 in Q1 2024 to 128,000inQ12025,whileVIVOSystemproductsalesdecreasedby128,000 in Q1 2025, while VIVO System product sales decreased by 67,000 from 82,000to82,000 to 15,000[223]. Financial Performance - For the three months ended March 31, 2025, the company reported revenues of 143,000,anincreaseofapproximately77.4143,000, an increase of approximately 77.4% compared to 82,000 for the same period in 2024[222]. - The cost of revenues for Q1 2025 was 11,000,upfrom11,000, up from 5,000 in Q1 2024, reflecting a 6,000increaseduetohigherproductsalesvolume[224].−Selling,generalandadministrativeexpensesroseto6,000 increase due to higher product sales volume[224]. - Selling, general and administrative expenses rose to 3.485 million in Q1 2025 from 2.656millioninQ12024,anincreaseofapproximately2.656 million in Q1 2024, an increase of approximately 829,000[225]. - Research and development expenses increased to 103,000inQ12025from103,000 in Q1 2025 from 37,000 in Q1 2024, primarily due to hiring a full-time employee[226]. - The company reported a net cash used in operating activities of 2.338millionforQ12025,comparedto2.338 million for Q1 2025, compared to 1.942 million for Q1 2024[235]. - As of March 31, 2025, the company had cash and cash equivalents of 0.5millionandanaccumulateddeficitof0.5 million and an accumulated deficit of 296.4 million[231]. - The company anticipates the need for additional financing in the near future to cover operating costs and repay outstanding short-term notes due January 31, 2026[233]. Acquisitions and Investments - On January 14, 2025, the company acquired PeriKard, LLC, issuing 275,000 shares valued at 113,000inexchangefor100113,000 in exchange for 100% membership interests[205]. - Cardionomix, a new subsidiary, was formed to pursue the acquisition of assets from Cardionomic, with 82% of its common stock owned by the company[207]. - The company issued a promissory note of 1.5 million to Cardionomic as part of the asset purchase agreement, with a maturity date three years from issuance[208]. - The company recognized 119,000inacquiredin−processresearchanddevelopmentexpensesrelatedtotheacquisitionofPerikard,LLConJanuary24,2025[227].RoyaltiesandFinancialObligations−Thecompanywillpayatotalroyaltyofapproximately12119,000 in acquired in-process research and development expenses related to the acquisition of Perikard, LLC on January 24, 2025[227]. Royalties and Financial Obligations - The company will pay a total royalty of approximately 12% of net sales of LockeT, starting from the first commercial sale in 2024 until December 31, 2035[248]. - A 5% royalty on net sales of LockeT will be paid up to 1 million, after which a 2% royalty will apply until cumulative royalties reach 10million,contingentonaU.S.patentbeinggranted[249].−ThecompanyisobligatedtopayroyaltiesundervariousagreementsexecutedbyOldCatheter[248].−Thecompanyhasenteredintoagreementstoforgiveaccruedinterestinexchangeforfutureroyaltyrights[248].AccountingandFinancialReporting−Stock−basedcompensationawardsarecalculatedusingtheBlack−Scholesmodel,withtheestimatedfairvalueamortizedoverthevestingperiod[247].−Thecompanyperiodicallyreviewslong−livedassetsforimpairment,recognizinglossesifexpectedfuturecashflowsarelessthancarryingamounts[245].−Intangibleassetsareamortizedonastraight−linebasisovertheirestimatedusefullives,withmanagementevaluatingtheneedforadjustments[244].−Newaccountingpronouncementsaredescribedintheconsolidatedfinancialstatements,detailingexpectedadoptiondatesandeffectsonoperations[251].−TheexpectedtermofstockoptionsisdeterminedusingSEC′ssafeharborrules,basedonvestingandcontractualterms[247].ChangesinFinancialPosition−Thechangeinfairvalueofroyaltiespayableduetorelatedpartiesdecreasedby10 million, contingent on a U.S. patent being granted[249]. - The company is obligated to pay royalties under various agreements executed by Old Catheter[248]. - The company has entered into agreements to forgive accrued interest in exchange for future royalty rights[248]. Accounting and Financial Reporting - Stock-based compensation awards are calculated using the Black-Scholes model, with the estimated fair value amortized over the vesting period[247]. - The company periodically reviews long-lived assets for impairment, recognizing losses if expected future cash flows are less than carrying amounts[245]. - Intangible assets are amortized on a straight-line basis over their estimated useful lives, with management evaluating the need for adjustments[244]. - New accounting pronouncements are described in the consolidated financial statements, detailing expected adoption dates and effects on operations[251]. - The expected term of stock options is determined using SEC's safe harbor rules, based on vesting and contractual terms[247]. Changes in Financial Position - The change in fair value of royalties payable due to related parties decreased by 1.077 million, from (86,000)inQ12024to(86,000) in Q1 2024 to (1.163 million) in Q1 2025[228].