MALVERN, PA — TELA Bio, Inc. (Nasdaq: TELA), a commercial-stage medical technology company focused on designing, developing and marketing a new category of tissue reinforcement materials to address unmet needs in soft tissue reconstruction, reported financial results for the third quarter ended September 30, 2020.
- Reported revenue of $5.3 million for the third quarter of 2020, increasing 34% over the third quarter of 2019
- Presented additional data from the BRAVO post-market study, further demonstrating a low incidence of surgical site infections and occurrences and an initial two-year hernia recurrence rate of zero
- Strategically added to commercial sales team and continued to educate surgeons through TELA LIVE virtual programs
“I am pleased with our strong third quarter results and proud of our team in continuing to execute and deliver to our customers and patients despite the ongoing challenges associated with the current pandemic,” said Antony Koblish, co-founder, President and Chief Executive Officer of TELA Bio.
“While we are encouraged by the healthy rebound we saw in hernia procedures in the third quarter, there continues to be uncertainty in light of the increased number of daily COVID-19 cases in certain regions of the country. However, we remain cautiously optimistic and prepared as a team to meet the challenges of these dynamic times and adapt our commercial plan to ensure that we can continue to support our customers and advance our mission of improving patient care and outcomes.”
Third Quarter 2020 Financial Results
Revenue was $5.3 million for the third quarter of 2020, an increase of 34% compared to the prior year period. Despite strong quarterly revenue, revenue growth in the third quarter was impacted by lower than expected procedural volumes as a result of hospitals and patients deferring elective procedures and other factors related to the COVID-19 pandemic.
Gross profit was $3.3 million for the third quarter of 2020, or 62% of revenue, compared to $2.6 million, or 66% of revenue, in the same period in 2019. The decrease in gross margin was due to the increase in the charge for excess and obsolete inventory adjustments as a percentage of revenue.
Operating expenses were $10.2 million in the third quarter of 2020, compared to $6.5 million in the same period in 2019. The increase was due to the expansion of the Company’s commercialization activities, increased outside development expenses and increased costs associated with operating as a public company, which were partially offset by lower travel and consulting expenses resulting from the cost containment actions taken in response to the COVID-19 pandemic.
Loss from operations was $6.9 million in the third quarter of 2020, compared to a loss from operations of $3.9 million in the same period in 2019.
Net loss was $7.7 million in the third quarter of 2020, compared to a net loss of $4.7 million in the same period in 2019.
Total cash and cash equivalents at September 30, 2020, were $81.5 million.
There is considerable uncertainty and lack of visibility regarding the Company’s near-term revenue growth prospects and product development plans due to the rapidly evolving environment resulting from the COVID-19 pandemic. The COVID-19 pandemic is a highly fluid situation, and it is not currently possible for the Company to reasonably estimate the impact that it may have on financial and operating results. Accordingly, TELA Bio will not be providing 2020 financial guidance.
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