Q3 2020 Neovasc Inc Earnings Call

Typically appropriate to facilitate expedited and efficient development and we view probably device.

B.

From August 2019.

Consideration of uncertainty and Bacon benefit risk determinations in medical device pre market approvals de Novo classification and humanitarian device exemption.

Example, one aide from this guidance discussed as a breakthrough device intended to treat a treatment resistant condition.

In that example, they discuss three scenarios of uncertainty.

The grade of the level of uncertainty for greater reliance on post market data collection.

As I stated earlier, we did not submit a robust post market study for consideration.

C.

From August 2019.

Factors to consider when making benefit risk determinations and medical devices pre market approval and the mobile classification.

Uncertainty.

Patient perspective as.

Availability of alternative.

Risk mitigation.

Novel Technology addressing unmet medical needs.

And finally D.

From April 2015.

Balancing pre market and post market data collection for devices subject to pre market approval.

I quote.

Getting the right balance between pre market and post market data collection, specifically, where appropriate a greater reliance on post market collection.

Including real World data collection.

Can reduce the extent of free market data collection and directly impact one patients will have access to this high quality safe and effective medical devices.

Taking into consideration all these guidance documents.

And the volume of data we had.

Especially given the focus of the program to provide more timely access of innovative medical devices for patients with unmet need.

We choose to selected DNA in December of 2019, with a request for an advisory panel meeting.

We believe that the clinical data presented would support our position that producer as a reasonable assurance of safety and effectiveness and the benefits clearly outweigh the risks.

And there's no option patient population.

Again, we are disappointed in the panels vote.

We must await Fps decision on the DNA.

And we are not hopeful about approval also reduce or at this point in time.

Given the panel's recommendation.

But I want to assure you.

We are working on all available options to the company to move forward from here.

We will update you on any further development as soon as possible.

Information and answer any questions for me if you have to notify body.

And while we are encouraged with the boat with the progress to date.

We are still not done with the <unk> expect many more questions from reviewers plus many more answers and results to be submitted.

The company is targeting a potential approval decision by the European notified body for a chair or a T. A and the first half of 2021.

We have already stated in the past that you took over 19 way to travel restrictions enrollment and a chair up to is temporarily on hold.

With a T F transdermal transaxle mitral valve replacement program is approaching important animal implants doing Q4.

If successful could lead to first and human implants, and the first half of 2021.

This finding is delayed from all original projections and primarily to resolve the COVID-19 challenges.

The company is encouraged by the positive feedback it has received on the device from our medical Executive Committee.

Most notably physician all supportive of the system's a little profile.

We capture ability and unique D shaped implant design.

It apart from competitive offering and development.

We continued to belief in your potential chair what T ask you expand the size of the market and be more broadly applicable than competitive systems under the Taliban N O Olsen April Coachella system.

Overall, we are pleased with the third quarter older disappointed in the outcome of the reasons F D. A panel meeting.

In the third quarter, we achieved from <unk> implant and revenue growth and reached the 300 patient milestone in Germany.

We continued to advance the chair up to a interior a T F devices.

Uh-huh targeting a decision by the European notified body, an hour mark application or chair or T. A and the first half of 2021.

We also make progress in solidifying you about capital structure and operations on all funded through the first quarter of 2021.

I will now turn the call over to Chris to discuss it with financial results.

Like you said.

Well. Thank you so much hotline recovery.

Third 2020.

COVID-19 in the second quarter.

However, we believe you're increasing restrictions and year and the salt.

That's cool too cause civilian fourthquarter Andover, new performance.

So I'm used to the third quarter of 2024.

$606000 compared to revenues of $500000 for the same period in 2019.

And English is 75%.

What other symptoms cream COVID-19 target levels for the period.

Because of the concerned in the third quarter of 2020.

Is $150000 compared to $138000 for the same period in 2019.

Gross margin to 76% compared to 72%.

Cause it brought up here.

Reducer continues to pose consistent margins and the move 70.

17th century.

Usually just to be substantially increased.

Sufficient resources to focus and flushed optimization within the supply chain.

Total expenses for the first time too.

$6 million compared to seven permanent damage to the same period in 2002.

I presume in a year.

And your security Clarkson frequent.

Yeah.

February administrative expenses for the quarter.

6 million.

Compared to $2.2 million a year ago.

An increase of $2.4 million, principally driven by 1.9 million dollar increase in medon expenses incurred Barnett.

Mm bye.

And then increase of non-cash impurity related expenses as we issue sure based incentives to install.

Seven development and clinical trial expenses, the $5.5 million.

The third.

For the same 422019.

Increase of $700000.

Recently, driven by an increase in development costs and head kind of makes sense.

Abuse of M C G.

Shoot three regular screen with the government coffers.

Thanks.

Neutral country and critical infection point in the coming quarters.

Yeah break in Ralston comprehensive loss for the third quarter of 2020.

10, $14 million and $10.4 million, respectively, or 51 sense basically couldn't diluted most krishna.

As compared with $7 million, I'm $6.6 million, respectively, or 83 cents.

Patterns loss for sure for the same period in 2019.

<unk> operations and capital expenditures with cash generated from upper entrance to equity in that time and things.

The company had approximately $14 million in taxes cash equivalents on September 30th 2020.

The company expects within you'll have sufficient cash on hand to sustain operations until March 2021.

Current burning.

Given the current nature of the market familiar vasquez due to the impact of the outcome of the <unk>.

Come to think of no assurance there'll be able to train.

The additional funds needed to integrate it to the company.

Ooh.

I think today's date to come into his 22 6 million common shares and should Max friendly.

That's really going to check out the $38 70 million chairs.

Yeah, Philly reviewing all operational and strategic options for the rest of this year and then to 2021 and we look forward to update from the market as we just put them in the best possible for the company.

<unk>.

Thank you and thank you all for listening to our opening remarks, we want to once again, thank you and thank all of our investors for their continued trust and support.

I would like to open it up for questions Anita.

Thank you Sir.

I'd like to ask a question. Please take care of I think five on on your telephone keypad if.

If you're using a speaker phone. Please make sure. He gives me assumptionist turned off to allow your sickness that he could appointment.

Five bucks to ask a question. The first for just a moment there are a lot I do want to know if authenticate this thing off a question.

Just take your first question from the back of Bank some SBB meeting.

Hi.

Hi.

<unk>.

Yes, Rebecca I can hear you yeah. Thank you.

Hi.

Can I get online topic.

The eight or not.

I can assure you that we are looking at all available clinical regulatory options as well as all options available to the company in its totality.

The other thing that I would like to point out is that.

As you know the company has two assets to reduce or any era.

And that in itself gives us always an advantage.

So that you know we have won and the other in the pipeline we are continuing to see a great progress with the reduced or indeed.

In Europe as we reported.

We saw a big growth in the third quarter.

Where there wasn't a little bit of a lift from the virus pandemics.

Usually Q4, we believe is going to be more impacted again, but we certainly see the underlying strength.

Well the demand for the reduce of product in Europe, which by now is really directed for the most part by physician own experience with the device with their own patient population.

So we have that on top of that we have the continued development activities on the chair side of.

Goals for the trends April as well as for the front some old program as I alluded to in my script. So we will continue to look at all options and how we move forward as a company. We certainly but also look at additional financing opportunities between now and March.

When we look confidently into the future. Although obviously this was and has been a setback for us.

And we will have to move forward from here and we believe there are still good opportunities for us.

To move forward and we will and we are working all available options for the company.

Well I think it interconnect.

Thank you we take our next question.

I will turn it from loop capital markets.

Please go ahead.

Thank you very much they take and make that landscape and freight cars.

So I.

I would like traffic crossing the dining at Santana what did he basically said take 20.

Changes certainty certainly DCIP post market clinical trials and welcome to streamline look like I know you mentioned, you've given detailed information later on but I was just curious any of the claims that actually follow the timeline, there and send us their clinical trial or any any other aspects of the credit.

Sorry.

Yes.

As I said before obviously, we are disappointed in the outcome of the panel meeting.

We believe that of the clinical data that we presented and I would say the totality of the clinical data we presented.

Okay. This indeed support the position that we have that's what we do so.

Has the reasonable assurance of safety in asset effectiveness that combined with the oil specific guidance documentation and guidelines that I went through in detail on my script.

That is why we believe.

We have an opportunity to present this data and for all these data to be carefully review.

Unfortunately that that did not turn out to be very positive as it relates to the efficacy side I do want to point out that the panel clearly folded for the safety of the reducer.

So I don't need to again the second closed on in major places do you have any friends.

<unk> 19, so mind, telling me a <unk> a second here to maybe speed up the process of a little bit till not.

To talk about your own house.

Correct Yeah.

Yeah. So I'm sure we are going to a very lengthy and very detailed process.

<unk>, a pickle cherwell device and threw them into the.

Hello, again, Uhm and noted is that all finance and one quarter of next year and he is Susan ultra looking at any potential option to extend the financing for at least another three months beyond that.

Okay. Thank you have a brand new.

You say or just the dining room.

Yeah. Thank you I appreciate it.

The options that we that we might have in that we're working on we'll certainly update the everyone.

Small business because the hospitals are again very busy with Covid station.

Uhm.

Also see that the underlying demand and growth of the therapy is there. So we already have a list of patients.

And the benefits cause I have to conclude that there was enough stand up that over and in terms of Stacey.

So first I'll have to be very clear panel.

I would say pretty clearly votes.

Much for ethanol.

Okay and Thats it.

Quite a bit to get through the garden obviously.

A lot there as far as their what their state presented and.

So it just looks to me, but would you agree that and Thats why you are definitely waiting for a decision.

Because there's still a chance.

That.