MAKO Surgical Corp. (MAKO Surgical), a US-based medical device company, has reported total revenue of $6.7 million for the third quarter of 2009, compared with the total revenue of $0.78 million in the year-ago quarter. It has also reported a net loss of $9.4 million, or $0.33 loss per share, for the third quarter of 2009, compared with the net loss of $10.2 million, or $0.56 loss per share, in the year-ago quarter.
2009 Third Quarter Financial Review
The revenue in the third quarter of 2009 primarily consisted of approximately $4.6 million in revenue from the sale of six RIO systems, and approximately $2.0 million in revenue from the sale of implants used in the 418 MAKOplasty procedures performed in the quarter.
Operating expenses were $12.3 million in the third quarter of 2009 compared to $9.9 million in the third quarter of 2008. The increase in operating expenses is primarily attributable to an increase in sales and marketing activities for the continued expansion of the direct sales force and commercialization of the RIO system and RESTORIS implant products, and an increase in general and administrative costs as MAKO continued to build infrastructure to support growth and incurred costs associated with operating as a public company.
Net loss attributable to common stockholders for the three months ended September 30, 2009 was $9.4 million, including non-cash stock-based compensation expense of $1.1 million, or $(0.33) per basic and diluted share, based on average basic and diluted shares outstanding of 28.6 million. This compares to a net loss attributable to common stockholders for the same period in 2008 of $10.2 million, including non-cash stock-based compensation expense of $0.6 million, or $(0.56) per basic and diluted share, based on average basic and diluted shares outstanding of 18.1 million.
Cash, cash equivalents and investments were $80.1 million as of September 30, 2009, which included the net proceeds of the equity financing, compared to $63.6 million as of December 31, 2008.
2009 Nine-Month Financial Review
For the nine months ended September 30, 2009, revenue was $25.4 million, primarily generated from the recognition of deferred revenue associated with the upgrade of seventeen TGS units to RIO systems, the sale of twelve RIO systems, and the sale of implants used in 1,041 MAKOplasty procedures performed during the period. The net loss attributable to common stockholders for the nine month period was $24.7 million, resulting in a net loss per common share of $(0.95) in the nine-month period ended September 30, 2009, compared to a net loss attributable to common stockholders of $26.8 million or $(1.76) per common share in the same period in 2008. Net loss attributable to common stockholders in 2008 included non-cash charges for accretion and dividends on preferred stock of $0.6 million which ceased upon the conversion of the preferred stock into common stock upon the closing of MAKO’s initial public offering during the first quarter of 2008.
Recent Business Developments
RIO Systems – Six RIO systems were installed and customer accepted at commercial sites during the third quarter. These new sites brought the total number of MAKO’s commercial MAKOplasty sites to 29 as of September 30, 2009.
MAKOplasty Procedure Volume – During the third quarter, 418 MAKOplasty procedures were performed, representing a 17% increase over the second quarter of 2009 and a 163% increase over the third quarter of 2008. As of September 30, 2009, a total of 1,041 MAKOplasty procedures have been performed in 2009 and 1,823 procedures have been performed since the first procedure in June 2006.
Clinical Education – In the third quarter, MAKO held three BioSkills courses, which are designed to bring together current and prospective MAKOplasty surgeons to share best practices. Additionally, an article was published in a peer-reviewed journal bringing the total number of peer reviewed articles on MAKOplasty to fourteen.
Commercialization Growth – MAKO recently doubled the size of its capital sales force to 16 sales people in the field selling RIO systems.
Equity Financing – In August 2009, MAKO closed a $58.4 million public offering of our common stock with net proceeds of $54.3 million after underwriting discounts and commissions and expenses of the offering. The net proceeds are anticipated to be used to support commercialization, sales, marketing and general administrative activities, for research and product development activities and to fund working capital and other general corporate purposes.
“We are pleased that our continued focus on execution produced strong operating results in the third quarter,” said Maurice R. Ferre, M.D., President and Chief Executive Officer of MAKO. “The 418 MAKOplasty procedures performed by our customers and the addition of six new commercial sites represent an increase in the adoption trends we experienced in the first half of 2009. In addition, we are gratified that we have received additional capital that we believe is adequate to allow for the continued execution of our business plan.”