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Titan Medical Inc (2)
Symbol TMD
Shares Issued 111,408,322
Close 2022-08-11 C$ 0.67
Market Cap C$ 74,643,576
Recent Sedar Documents

Titan Medical spends $9.5M (U.S.) on R&D in Q2 2022

2022-08-11 14:31 ET - News Release

Mr. Cary Vance reports

TITAN MEDICAL REPORTS FINANCIAL RESULTS FOR THE SECOND QUARTER 2022

Titan Medical Inc. has released its financial results for the three and six months ended June 30, 2022.

"I am thrilled to lead Titan Medical as president and CEO and have been committed to the company's mission to improve surgical outcomes as a director of the company since September, 2020. We continue to make progress on impacting the future of minimally invasive robotic surgery and the operating room ecosystem. Our technical partnerships, our relationships with surgeons and the dedication of our employees support our efforts in submitting an IDE [investigational device exemption] application, designing forthcoming clinical trials and planning our commercialization strategy for the U.S. market," stated Cary G. Vance, Titan's president and chief executive officer. "Setting Titan apart is our innovative ergonomic platform design derived from extensive surgeon input. We believe this will set the stage for the next generation of single-access RAS to advance patient care. The capability of the Enos system to operate robust, small-scale and dexterous instruments through a minimal incision should improve patient outcomes and change the paradigm for surgeons and patients," concluded Mr. Vance.

The company plans to pursue a De Novo regulatory process for marketing authorization with the United States Food and Drug Administration (FDA). Utilizing the Q-submission program, the company has engaged in continuing dialogue with the FDA to clarify requirements in an effort to mitigate against timeline risks. The company plans to file the IDE application with the FDA mid-year 2023 for its initial target indication for benign gynecologic surgical procedures. Titan anticipates receiving a response on the IDE application from the FDA in the second half of 2023. Following IDE approval, Titan expects to proceed with and complete a clinical study in time for submission of a de novo classification request with the FDA in 2024. Commercial launch of the Enos single-access RAS system is scheduled to begin upon receipt of marketing authorization from the FDA, anticipated in early 2025.

Recent company activities and progress:

  • Announced appointment of Mr. Vance as president and chief executive officer:
    • Previously served as CEO at Xcath Inc., a privately held neurovascular robotics company, and held similar positions at Optiscan Biomedical and Myoscience. Served as president and CEO at Hansen Medical, a publicly held intravascular robotics company acquired by Auris Health in 2016, which was subsequently acquired by Johnson & Johnson in 2019. Prior to Hansen, served in various global executive leadership roles at Teleflex, Covidien (now part of Medtronic) and GE Healthcare;
  • Granted 180-day extension by Nasdaq to regain compliance with minimum bid price rule:
    • In addition to reviewing its options, the company continues to try to regain compliance with Nasdaq Rule 5550(a)(2) prior to the Dec. 26, 2022, deadline;
  • Continued communications with the FDA through Q-submission process:
    • The company submitted an additional Q-submission with the FDA, as part of its continuing communications plan to obtain additional guidance from the FDA;
  • Participated at the Society of Robotic Surgery annual meeting held June 30 to July 3, 2022:
    • Chris Seibert, Titan's vice-president of upstream marketing, participated in a panel discussion featuring executives from companies recognized for promising technology platforms in robotic surgery and delivered a presentation on Titan during the plenary session;
  • Announced agreement with Nissha Medical Technologies for the manufacture of surgical consumables:
    • Manufactured single-use surgical components will be used for verification and validation testing and in preclinical and clinical studies of Titan's Enos system;
  • Held an annual and special meeting of shareholders:
    • All nominees for election were elected as directors of the company by shareholders. The shareholders approved the renewal and amendment of the company's share unit plan and deferred share unit plan and adoption of an employee share purchase plan;
  • Bill Fahey appointed vice-president of manufacturing and operations:
    • Previously senior vice-president of engineering at Precision Spine/Spinal USA and was with Orthofix/Blackstone Medical Inc. as senior director of engineering. Bringing development, manufacturing and commercialization experience to Titan, is responsible for both in-house and contract manufacturing relationships, working closely with product development and the quality and regulatory affairs teams;
  • Finalizing product design transfer to manufacturing:
    • Manufactured units of the Enos system expected later this year;
  • Presented at the H.C. Wainwright Global Investment Conference in Miami on May 25, 2022, and participated in investor meetings.

Financial highlights summary

As of June 30, 2022, Titan had cash and cash equivalents of $20.2-million, compared with $32.3-million at Dec. 31, 2021.

For the three months ended June 30, 2022, R&D (research and development) expenses increased to $9.5-million compared with $8.4-million for the for the three months ended June 30, 2021. R&D expenses were $19.1-million for the six months ended June 30, 2022, compared with $17.6-million for the six months ended June 30, 2021. R&D expenses for the three-month and six-month periods ending June 30, 2022, were related to the development of the Enos system and an increase in labour costs as the company continues to add the required resources to its engineering, regulatory and quality teams to advance the Enos system. During this period, the company's focus was on completing product development and transferring key components on the Enos system to its external manufacturing partner. During the quarter, the company transferred substantially all of the components to its manufacturing partner.

G&A (general and administrative) expenses decreased to $3.1-million for the three months ended June 30, 2022, compared with $3.6-million for the three months ended June 30, 2021. The decrease in G&A expenses in the three-month period is related to a decrease in stock-based compensation of $1.1 million, partially offset by an increase in severance costs and public company costs.

For the six-month period ended June 30, 2022, G&A expenses were $5.7-million, compared with $6.2-million in the comparative period. The decrease in G&A expenses in the six-month period is primarily related to a decrease in stock-based compensation of $1.4-million and a decrease in professional and consulting fees partially offset by an increase in severance costs, public company costs and recruitment fees related to filling open roles on the senior leadership team.

The company's interim financial statements and MD&A (management's discussion and analysis) are available at SEDAR and on the SEC website.

Investor audio webcast information

Titan Medical will host an investor audio webcast at 8:30 a.m. ET today (Aug. 11, 2022) to discuss the company's financial results for the three months ended June 30, 2022, and recent business highlights. The webcast can be accessed through the investor relations section of the company's website.

About Titan Medical Inc.

Titan Medical, a medical device company headquartered in Toronto, Ont., and with operations in Chapel Hill, N.C., is focused on enhancing robotic-assisted surgery using innovative technology through a single access point. The Enos robotic single-access surgical system is being developed with an ergonomic focus to provide a surgical experience that imitates real-life movements that surgeons demand and includes multiarticulating instruments designed to allow surgeons an increased range of motion in a confined space, with dexterity and the ability to exert the forces necessary to complete common surgical tasks. With the Enos system, Titan intends to initially pursue gynecologic surgical indications.

We seek Safe Harbor.

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