AVHHL AVITA Medical Inc (PK)

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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): November 07, 2024

 

 

AVITA Medical, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-39059	85-1021707
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
28159 Avenue Stanford Suite 220
Valencia, California				91355
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 661 367-9170

 

(Former Name or Former Address, if Changed Since Last Report)

 

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:

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, par value $0.0001 per share		RCEL		The Nasdaq Stock Market LLC

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. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On November 7, 2024, AVITA Medical, Inc. (the "Company") issued a press release announcing its financial results for the second quarter ended September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information furnished in this report, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 8.01 Other Events.

On November 7, 2024, the Company and an affiliate of OrbiMed Advisors, LLC (the "Lender") mutually agreed to amend the credit agreement between the Lender and the Company executed on October 18, 2023, as amended on November 30, 2023 and May 28, 2024. Under the terms of this amendment and subject to the payment by the Company of a consent fee to the Lender, the Company and the Lender mutually agreed to (1) terminate two additional tranches of available debt in the aggregate amount of $50.0 million and (2) remove the trailing 12-month revenue covenant for the fourth quarter of 2024, which was set at $67.5 million. All revenue covenants for subsequent quarters remain in effect.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit No.		Description of Exhibit
99.1		Press release titled “AVITA Medical Reports Third Quarter Financial Results”
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

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SIGNATURES

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.

			AVITA Medical, Inc.
Date:	November 7, 2024	By:	/s/ David O'Toole
			David O'Toole Chief Financial Officer

 

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AVITA Medical Reports Third Quarter Financial Results

 

VALENCIA, Calif., November 7, 2024 — AVITA Medical, Inc. (NASDAQ: RCEL, ASX: AVH), a commercial-stage regenerative medicine company focused on first-in-class devices for wound care management and skin restoration, today reported financial results for the third quarter ended September 30, 2024.

 

Financial Results and Recent Business Updates

 

 

“Third-quarter commercial revenue surpassed our second-quarter record by 29%, underscoring the strength of RECELL GO as a transformative product and the success of adoption," said Jim Corbett, Chief Executive Officer of AVITA Medical. "With over 75% of our revenue base now transitioned to RECELL GO and the anticipated launch of Cohealyx in 2025, we are positioned to address a broad continuum of wound care needs. We remain committed to establishing RECELL as the standard of care and transforming wound care, all while advancing our mission to improve patient outcomes and expand access."

 

Future Milestones

 

 

Financial Guidance

 

 

Third Quarter 2024 Financial Results

 

Commercial revenue was $19.5 million in the three-months ended September 30, 2024, an increase of $5.9 million, or 43.8%, compared to $13.6 million in the corresponding period in the prior year. The growth in commercial revenue was largely driven by accelerating the transition to RECELL GO, as well as deeper penetration within existing customer accounts and new accounts for full-thickness skin defects.

Gross profit margin was 83.7% compared to 84.5% in the corresponding period in the prior year. The decrease was due to ongoing engineering and validation of the RECELL GO durable and disposable cartridge.

BARDA income decreased to zero, compared to $0.2 million in the corresponding period in the prior year, due to the ending of reimbursable clinical trials. BARDA income in the prior year consisted of funding from the Biomedical Advanced Research and Development Authority, under the Assistant Secretary for Preparedness and Response, within the U.S. Department of Health and Human Services, under ongoing USG Contract No. HHSO100201500028C.

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Total operating expenses for the quarter were $30.2 million, compared to $21.1 million in the same period in 2023. The increase in operating expenses is primarily attributable to an increase of $4.6 million in sales and marketing expenses due to employee-related costs, including salaries and benefits, commissions, professional fees, and travel expenses, collectively, as a result of the expansion of the Company's commercial organization to support its growing commercial operations. G&A expenses increased by $3.5 million as a result of higher salaries and benefits, severance benefits, deferred compensation expenses, and professional fees, partially offset by lower other corporate expenses. In addition, the increase in operating expenses included an increase of $1.0 million in R&D costs, which was primarily due to employee compensation costs related to the Company's expanded team of medical science liaisons.

Interest expense increased approximately $1.3 million in comparison to the same period in the prior year due to the interest expense related to the long-term debt incurred as part of the OrbiMed Credit Agreement, for a principal amount owed of $40.0 million.

Other (expense) income, net decreased by $1.7 million to an expense of $1.1 million from income of $0.6 million in the prior period. In the current period, other (expense) income consists of non-cash charges of $1.0 million and $0.8 million related to the changes in fair value of the debt and warrant liability, respectively, offset by $0.6 million in income related to the Company's investments. The prior period income consisted of $0.7 million related to our investments offset by $0.1 million in other losses, net.

 

Net loss was $16.2 million, or a loss of $0.62 per basic and diluted share, compared to a net loss of $8.7 million, or a loss of $0.34 per basic and diluted share, in the same period in 2023.

 

As of September 30, 2024, the Company had approximately $44.4 million in cash, cash equivalents, and marketable securities.

 

Webcast and Conference Call Information

 

AVITA Medical will host a conference call on Thursday, November 7, 2024, at 1:30 p.m. Pacific Time (Friday, November 8, 2024, at 8:30 a.m. Australian Eastern Daylight Time) to discuss its third quarter 2024 financial results and recent business highlights. The live webcast will be accessible under the Events & Presentations section of the AVITA Medical website at ir.avitamedical.com. To participate by telephone, please register in advance to receive dial-in details and a personal PIN at https://register.vevent.com/register/BI5bf899d9f4574896abaf08308299cbdf. A replay of the webcast will be available shortly after the live event.

 

About AVITA Medical, Inc.

AVITA Medical® is a commercial-stage regenerative medicine company transforming the standard of care in wound care management and skin restoration with innovative devices. At the forefront of our platform is the RECELL® System, approved by the U.S. Food and Drug Administration for the treatment of thermal burn wounds and full-thickness skin defects, and for repigmentation of stable depigmented vitiligo lesions. RECELL harnesses the regenerative properties of a patient’s own skin to create Spray-On Skin™ Cells, delivering a transformative solution at the point-of-care. This breakthrough technology serves as the catalyst for a new treatment paradigm enabling improved clinical outcomes. In the United States, AVITA Medical also holds the exclusive rights to market, sell, and distribute PermeaDerm®, a biosynthetic wound matrix, and Cohealyx™, an AVITA Medical-branded collagen-based dermal matrix.

 

In international markets, the RECELL System is approved to promote skin healing in a wide range of applications including burns, full-thickness skin defects, and vitiligo. The RECELL System is TGA-registered in Australia, has received CE mark approval in Europe, and has PMDA approval in Japan.

 

To learn more, visit www.avitamedical.com.

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Forward-looking statements generally may be identified by the use of words such as “anticipate,” “expect,” “intend,” “could,” “would,” “may,” “will,” “believe,” “continue,” “estimate,” “look forward,” “forecast,” “goal,” “target,” “project,” “outlook,”

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“guidance,” “future,” and similar words or expressions, and the use of future dates. Forward-looking statements include, but are not limited to, statements relating to the timing and realization of regulatory approvals of our products; physician acceptance, endorsement, and use of our products; failure to achieve the anticipated benefits from approval of our products; the effect of regulatory actions; product liability claims; risks associated with international operations and expansion; and other business effects, including the effects of industry, as well as other economic or political conditions outside of the Company’s control. These statements are made as of the date of this release, and the Company undertakes no obligation to publicly update or revise any of these statements, except as required by law. For additional information and other important factors that may cause actual results to differ materially from forward-looking statements, please see the “Risk Factors” section of the Company’s latest Annual Report on Form 10-K and other publicly available filings for a discussion of these and other risks and uncertainties.

 

Investor & Media Contact:

Jessica Ekeberg

Phone +1-661-904-9269

investor@avitamedical.com

media@avitamedical.com

 

Authorized for release by the Chief Financial Officer of AVITA Medical, Inc.

 

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AVITA MEDICAL, INC.

Consolidated Balance Sheets

(In thousands, except share and per share data)

 

		As of
		September 30, 2024				December 31, 2023
ASSETS
Cash and cash equivalents		$	18,639			$	22,118
Marketable securities			25,766				66,939
Accounts receivable, net			10,288				7,664
BARDA receivables			111				30
Prepaids and other current assets			2,892				1,659
Inventory			6,229				5,596
Total current assets			63,925				104,006
Plant and equipment, net			9,151				1,877
Operating lease right-of-use assets			3,780				2,440
Corporate-owned life insurance ("COLI") asset			3,059				2,475
Intangible assets, net			590				487
Other long-term assets			546				355
Total assets		$	81,051			$	111,640
LIABILITIES, NON-QUALIFIED DEFERRED COMPENSATION PLAN SHARE AWARDS AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities		$	4,187			$	3,793
Accrued wages and fringe benefits			9,776				7,972
Current non-qualified deferred compensation ("NQDC") liability			1,870				168
Other current liabilities			1,308				1,266
Total current liabilities			17,141				13,199
Long-term debt			42,547				39,812
Non-qualified deferred compensation liability			2,742				3,663
Contract liabilities			332				357
Operating lease liabilities, long term			3,079				1,702
Warrant liability			2,759				3,158
Total liabilities			68,600				61,891
Non-qualified deferred compensation plan share awards			224				693
Commitments and contingencies (Note 11)
Stockholders' equity:
Common stock, $0.0001 par value per share, 200,000,000 shares authorized, 26,217,629 and 25,682,078, shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively			3				3
Preferred stock, $0.0001 par value per share, 10,000,000 shares authorized, no shares issued or outstanding at September 30, 2024 and December 31, 2023			-				-
Company common stock held by the non-qualified deferred compensation plan			(1,255	)			(1,130	)
Additional paid-in capital			363,769				350,039
Accumulated other comprehensive loss			(2,065	)			(1,887	)
Accumulated deficit			(348,225	)			(297,969	)
Total stockholders' equity			12,227				49,056
Total liabilities, non-qualified deferred compensation plan share awards and stockholders' equity		$	81,051			$	111,640

 

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AVITA MEDICAL, INC.

Consolidated Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

 

		Three-Months Ended						Nine-Months Ended
		September 30, 2024			September 30, 2023			September 30, 2024			September 30, 2023
Sales revenue		$	19,394		$	13,645		$	45,681		$	35,948
Lease revenue			152			-			164			-
Total revenues			19,546			13,645			45,845			35,948
Cost of sales			(3,190	)		(2,113	)		(6,814	)		(5,984	)
Gross profit			16,356			11,532			39,031			29,964
BARDA income			-			212			-			1,369
Operating expenses:
Sales and marketing			(15,144	)		(10,532	)		(44,086	)		(27,075	)
General and administrative			(9,590	)		(6,124	)		(26,071	)		(20,584	)
Research and development			(5,428	)		(4,394	)		(15,510	)		(14,056	)
Total operating expenses			(30,162	)		(21,050	)		(85,667	)		(61,715	)
Operating loss			(13,806	)		(9,306	)		(46,636	)		(30,382	)
Interest expense			(1,359	)		(10	)		(4,063	)		(21	)
Other (expense) income, net			(1,068	)		615			478			2,141
Loss before income taxes			(16,233	)		(8,701	)		(50,221	)		(28,262	)
Income tax benefit (expense)			28			(11	)		(35	)		(54	)
Net loss		$	(16,205	)	$	(8,712	)	$	(50,256	)	$	(28,316	)
Net loss per common share:
Basic and diluted		$	(0.62	)	$	(0.34	)	$	(1.95	)	$	(1.12	)
Weighted-average common shares:
Basic and diluted			25,983,929			25,401,754			25,794,690			25,281,920

 

 

 

 

 

 

 

 

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v3.24.3

Document And Entity Information	Nov. 07, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 07, 2024
Entity Registrant Name	AVITA Medical, Inc.
Entity Central Index Key	0001762303
Entity Emerging Growth Company	true
Entity File Number	001-39059
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	85-1021707
Entity Address, Address Line One	28159 Avenue Stanford
Entity Address, Address Line Two	Suite 220
Entity Address, City or Town	Valencia
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91355
City Area Code	661
Local Phone Number	367-9170
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Ex Transition Period	false
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	RCEL
Security Exchange Name	NASDAQ

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