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INVO Bioscience Reports Record Fourth Quarter and Year End 2018 Financial Results
MEDFORD, Mass., April 16, 2019 /PRNewswire/ -- INVO Bioscience, Inc. (OTCQB: IVOB), a medical device company which was granted FDA clearance for the first Intravaginal Culture System, INVOcell™, today announced its fourth quarter and year end financial results for the periods ended December 31, 2018 as well as recent highlights.
Financial Results and Recent Highlights:
- Revenue for Q4 2018 increased 90.5% at $154,990, compared to $81,355 for the same period a year ago;
- Revenue for 2018 increased 75.2% at $494,375, compared to $282,145 for YE 2017;
- Closed exclusive U.S. licensing agreement with Ferring International Center S.A. the parent Company of Ferring Pharmaceuticals U.S. to commercialize the novel INVOcell™ system for use in the treatment of infertility. Agreement closed on January 14, 2019;
- Company received a $5 million one-time milestone payment subsequent to the end of the quarter and year end, with the ability to receive another $3 million upon obtaining label enhancement;
- In January 2019, the Company appointed Michael J. Campbell as COO & VP of Business Development, joining the Company from most recently as VP of IVF Americas for Cooper Surgical Inc. (CSI), a wholly owned subsidiary of The Cooper Companies (NYSE: COO) – Campbell will head up the INVO's planned commercialization efforts internationally, as well as oversee the launch of the INVO clinic strategy in the United States;
- In March 2019, INVO announced the launch its first Company-owned embryology center in the Bay Area of California.
Katie Karloff, Chair and Chief Executive Officer of INVO Bioscience, commented, "I am extremely pleased with the progress made over the last year to accelerate the adoption of the revolutionary INVOcell device and procedure. We started the year by rapidly increasing adoption rates of the device, which culminated in 91% sales growth in the fourth quarter, and concluded it by entering into an exclusive U.S. licensing agreement with one of the world's leading fertility companies, Ferring Pharmaceuticals, which we believe will only accelerate our revenue growth into the future. With the licensing agreement in place and U.S. commercialization well taken care of, it has allowed us to focus our efforts on other value-creating opportunities: expanding our commercialization efforts internationally and building out our clinic model in the United States."
Ms. Karloff continued, "To head up international efforts, in February 2019, we announced the appointment of Michael Campbell as our COO and Vice President of Business Development. Mike was most recently the Vice President of IVF Americas Business Unit for Cooper Surgical. Mike has a strong background in the fertility market and has significant knowledge of and relationships with companies and distributors that operate internationally. Over the last couple of months, we are actively speaking with potential commercialization partners in Europe, the Middle East and Africa, India, China, and the Latin American markets. I look forward to advancing these discussions as we look to develop a commercial model that will successfully drive adoption of INVOcell outside the U.S.
"Additionally, we are actively deploying our clinic model in the U.S. In March, we announced our first Company-owned embryology center to be opening in the Bay Area of California. This first center is one we will look to replicate in other parts of the country allowing us to capture a larger share of the overall procedure opportunity, which substantially increases our addressable market opportunity.
"Having received $5 million in up front milestone payments, we now have the balance sheet and resources to pursue two key opportunities that we believe will build substantial long-term value in INVO Bioscience. I believe 2019 will be an exciting year for our company and thank our shareholders for their commitment over the last number of years," Ms. Karloff concluded.
Terms of U.S. Distribution Agreement
Under the terms of the license and supply agreement, INVO Bioscience received an upfront cash payment, is eligible to receive a second additional milestone payment based upon the successful completion of the INVOcell product label enhancement and will receive payment for the supply of each INVOcell device. Additionally, Ferring is obligated, subject to certain conditions, to achieve defined minimum revenue targets over the next seven years. INVO Bioscience will be responsible for manufacturing and supplying INVOcell to Ferring for commercial sales and to obtain a five (5) day label enhancement from the FDA for the current incubation period for the product. INVO Bioscience also retains certain limited rights to establish INVO clinics that exclusively commercialize INVO cycles and will retain commercialization rights outside the U.S.
Further terms of the agreement can be found in an 8-K filed by INVO Bioscience on January 17, 2019 with the SEC and in our 10-K. Please click here to access the report.
2018 Financial Results
Net sales and revenues for year ended December 31, 2018 were $494,375 compared to $282,145 for the same year ended December 31, 2017; an increase of 75.2%.
Cost of goods sold for the year ended December 31, 2018 were $90,367 or approximately 18% of revenues compared to $51,954 or approximately 18% of revenues for the year ended December 31, 2017.
Selling, general and administrative (SG&A) expenses for the year ended December 31, 2018 were $3,038,068 as compared to $870,612 for the year ended December 31, 2017. Included in SG&A during 2018 was $1.5 million of non-cash common stock compensation in consideration for services performed both pre and post FDA clearance for clinical guidance and support by our Medical Director.
Adjusted EBITDA, which is a non-GAAP measure of operating performance, was $(424,723) during the year ended December 31, 2018, compared to $(408,382) for year ended December 31, 2017. Net loss for the year ended December 31, 2018 was $(3,062,195), or $(0.02) per share, compared with $(702,163), or $(0.00) per share for year ended December 31, 2017.
The Company ended the quarter with $212,243 in cash and equivalents. As disclosed, in connection with the signing of the U.S. distribution agreement in January 2019, the company received a $5 million one-time milestone payment to execute its business plan.
Additional details pertaining to the annual financials can be found in our 10-K filed today with the SEC.
Use of Non-GAAP Measure
Adjusted EBITDA is presented herein and is a non-GAAP measure. However, this measure is not intended to be a substitute for those financial measures reported in accordance with GAAP. Adjusted EBITDA has been included because management believes that, when considered together with the GAAP figures, it provides meaningful information related to our operating performance and liquidity and can enhance an overall understanding of financial results and trends. See our attached financials for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.
About INVO Bioscience
We are a medical device company focused on creating simplified, lower cost treatments for patients diagnosed with infertility. Our solution, the INVO Procedure, is a disruptive new technology. The INVO Procedure is a revolutionary in vivo method of vaginal incubation that offers patients a more natural and intimate experience. Our lead product, the INVOcell, is a patented medical device used in infertility treatment and is considered an Assisted Reproductive Technology (ART). The INVOcell is the first Intravaginal Culture (IVC) system in the world used for the natural in vivo incubation of eggs and sperm during fertilization and early embryo development, as an alternative to traditional In Vitro Fertilization (IVF) and Intrauterine Insemination (IUI). Our mission is to increase access to care and expand fertility treatment across the globe with a goal to lower the cost of care and increase availability of care. For more information, please visit http://invobioscience.com/
Safe Harbor Statement
This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company invokes the protections of the Private Securities Litigation Reform Act of 1995. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategies, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. Factors that may cause actual results to differ materially from those in the forward-looking statements include those set forth in our filings at www.sec.gov. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
For more information, please contact:
Kathleen Karloff, CEO
978-878-9505 ext. 504
Lytham Partners, LLC
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SOURCE INVO Bioscience, Inc.