CVRx, Inc.
PART I
Item 1. Business
Overview
CVRx is a commercial-stage medical device company focused on developing, manufacturing, and commercializing innovative and minimally invasive neuromodulation solutions for patients with cardiovascular disease. Barostim is the first medical technology approved by the U.S. Food and Drug Administration (the “FDA”) that uses neuromodulation to improve the symptoms of patients with heart failure (“HF”). Barostim is an implantable device that delivers electrical pulses to baroreceptors located in the wall of the carotid artery to counteract decreased baroreceptor signaling, which creates an imbalance in the brain’s Autonomic Nervous System (“ANS”) resulting in excess neurohormones that drive HF progression. Barostim provides Baroreflex Activation Therapy (“BAT,” or “Barostim Therapy”), which links the cardiovascular system to the ANS. This therapy complements the pharmaceutical neurohormonal blockade, or Guideline Directed Medical Therapy (“GDMT”), by increasing the signaling of the baroreceptors, thereby, reducing symptoms of HF. Barostim received the FDA Breakthrough Device designation and is FDA-approved for use in HF patients in the U.S. We estimate our total market opportunity using both prevalence and incidence epidemiologic models in which prevalence reflects the total number of individuals indicated for therapy at a given time, while incidence captures the annual occurrence of new cases meeting the indication. Based on these distinct models, we estimate that our prevalence-based market opportunity for HFrEF is $10.5 billion in the U.S. Using an incidence-based model, we estimate an annual market opportunity of $2.4 billion in the U.S.
HF is one of the most prevalent and devastating cardiovascular diseases. We estimate that there are approximately 64 million people worldwide suffering from HF, including approximately 6.7 million people in the U.S. HF is characterized by the heart’s inability to effectively circulate blood throughout the body resulting in insufficient levels of oxygen and nourishment to various body parts. This impacts a patient’s ability to function and leads to a variety of symptoms such as shortness of breath, extreme fatigue, exercise intolerance, swelling, and fluid retention that affects the patient’s quality of life, both physically and emotionally. HF worsens over time due to maladaptive responses from the body’s control systems, mediated by the ANS, that lead to excessive neural and hormonal activation. Autonomic activation is also a significant mechanism involved with multiple other cardiovascular diseases, such as hypertension, angina pectoris, and cardiac arrhythmia, as well as other diseases, such as chronic kidney disease.
We are currently focused on the treatment of patients with HF with reduced Ejection Fraction (“HFrEF”), which represent approximately 31% of the patients with HF. In HFrEF, the left ventricle loses its ability to contract properly, resulting in insufficient power to pump and push the necessary quantities of blood into circulation. Approximately 75% of HFrEF patients die within five years of being admitted to the hospital for HFrEF. Patients with HFrEF are typically placed on a treatment progression plan during which they are initially given GDMT to help manage symptoms, and then progress to more invasive and costly treatment options involving other implantable devices with the most severe patients often requiring Left Ventricular Assist Devices (“LVADs”) or heart transplants. These other implantable devices mostly target different HFrEF patient populations, may require an invasive procedure that places hardware directly inside the heart, and are not designed to address the imbalance of the ANS that causes the disease. We believe there is a significant need and market opportunity for a safe, effective, and minimally invasive device-based treatment option for HFrEF.
We believe Barostim offers meaningful benefits for patients, physicians and payers that will continue to drive adoption of our therapy. The primary benefits include:
| • | Addresses significant unmet medical need. Barostim addresses a life-threatening disease for patients who failed to receive adequate benefits from existing treatments and who have no alternative treatment options. Based on this, the FDA granted Barostim a Breakthrough Device designation for HFrEF in June 2015. |
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| • | Safe and effective treatment. Our BeAT-HF pivotal trial demonstrated compelling safety and effectiveness data regarding the clinical benefits of Barostim for HFrEF. The pre-market data demonstrated safety and effectiveness leading to FDA approval, and safety and effectiveness were confirmed by the post-market data. These results showed significant improvement in the following patient-centered outcomes: |
| • | Exercise capacity (measured by the standardized 6 Minute Hall Walk (“6MHW”) distance test): Our therapy demonstrated that patients in the Barostim group were able to improve the distance they walked in a six-minute period by 56 meters and 44 meters more than patients in the control group at six months and at one year, respectively, following implant, meaning the improvement was sustained. A 25-meter improvement in walking distance is considered clinically meaningful. |
| • | Quality of life (measured by Minnesota Living with Heart Failure (“MLWHF”) questionnaire): Our therapy improved quality of life by 14-points at six months, 8-points at one year and 10-points after two years of therapy compared to patients receiving GDMT alone. Patients receiving Barostim Therapy for two years reported persistent improvement in their ability to work around the house, sleep, their sense of control, and their mobility, while feeling like less of a burden to their family or friends. A 5-point improvement in the MLWHF questionnaire is considered clinically meaningful. |
| • | Functional status (determined by New York Heart Association (“NYHA”) classification): Our therapy demonstrated the following improvements in NYHA functional status versus the control group at the specific points in time, meaning Barostim demonstrated greater and sustained improvement: at six months, 67% in the Barostim group and 37% in the control group, favoring the Barostim group by 30 percentage points; at one year, 73% in the Barostim group and 41% in the control group, favoring the Barostim group by 32 percentage points; and, at two years, 68% in the Barostim group and 41% in the control group, favoring the Barostim group by 27 percentage points. |
| • | Freedom from All-Cause Death, LVAD, or Transplant. Patients in the Barostim group had a directionally favorable 34% reduction in all-cause death or the use of LVAD or heart transplant versus the control group. |
| • | Improvement in Hierarchical Composite Outcomes. Based on a hierarchical composite outcomes analysis (including cardiovascular (“CV”) mortality, LVAD/transplant, HF hospitalization and quality of life), the Win Ratio (defined below) was 1.26 in favor of the Barostim group. |
| • | Implant safety. The major adverse neurological or cardiovascular system or procedure-related event (“MANCE”) free rate exceeded the performance criteria of 85%, with 121 out of 125 implanted patients being event free, resulting in an event-free rate of 97% (p < 0.001; 95% 1-sided CI: 93% to 100%). |
In summary, the primary safety endpoint in the pre-market phase was previously met and subsequently confirmed in the post-market phase. In the pre-market phase, all effectiveness endpoints were previously met, demonstrating 6-month improvements in 6MHW, quality of life, NYHA Class and NT-proBNP (defined below). The post-market phase effectiveness primary endpoint of CV mortality and HF hospitalization was not met. Additional post-market phase effectiveness analyses (Win Ratio, freedom from all-cause mortality) suggested a favorable effect of Barostim Therapy. The totality of the 6, 12 and 24-month data demonstrated symptomatic improvements for HF patients who are NYHA Class III or Class II (who had a recent history of Class III) despite treatment with guideline-directed therapies and who have a LVEF ≤ 35% and a NT-proBNP<1,600 pg/mL.
| • | Widely accepted mechanism of action. Our platform technology is based on a widely accepted mechanism of action and is designed to complement GDMT to further address the imbalance of the ANS and the consequent excess of neurohormones that cause HFrEF and other cardiovascular diseases to worsen over time. |
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| • | Strong global clinical evidence. The benefits of treatment with Barostim were shown to be similarly robust and reproducible across all three of our HF clinical studies, including BAT-in-HF (Phase I), HOPE4HF (Phase II) and BeAT-HF (Phase III pivotal trial), evaluating 624 patients in aggregate across the U.S., Germany, Italy, France, Canada and the United Kingdom. Barostim Therapy’s trial results have been published in more than 65 peer-reviewed publications, approximately 25 of which relate to the treatment of HF, including, among others, the Journal of the American College of Cardiology and the European Journal of Heart Failure. |
| • | Minimally invasive implant procedure. Barostim’s implantable pulse generator (“IPG”) and stimulation lead are implanted during a minimally invasive implant procedure typically performed in an outpatient setting that lasts approximately one hour and involves two small skin incisions. Our device does not require hardware to be implanted in the heart or vasculature, which is the case with most other device-based treatments indicated for different HFrEF patient populations. Patients typically recover quickly and are discharged from the hospital within 24 hours of the procedure. |
| • | Potential reduction in total healthcare costs for HFrEF patients. A Company-sponsored and co-authored cost-impact analysis, which was published in BMC Cardiovascular Disorders, a peer-reviewed manuscript, predicted BAT plus GDMT would become the lower-cost alternative treatment within three years from implantation, as compared to GDMT alone, resulting in significant cost savings to healthcare systems. |
| • | Inherent patient compliance and durability. Barostim ensures patient compliance, unlike most commercially available drug treatments, as it requires no device interaction by the patient. Our device has a battery that does not require recharging, has an average service life of five to six years and is replaced through a short outpatient procedure. |
Barostim is a minimally invasive neuromodulation device that consists of two implantable components, an IPG and a stimulation lead and is programmed by a wireless clinician-controlled programmer that communicates with the IPG. The IPG contains the electronics and battery in a hermetic enclosure and controls and delivers the imperceptible and persistent electrical pulses to the carotid baroreceptors through the stimulation lead attached to the exterior wall of the carotid artery. Barostim has no intravascular components. These electrical pulses delivered to the baroreceptors increase signals to the brain to modulate the cardiovascular function, thereby improving symptoms of HFrEF. Our wireless programmer allows physicians to verify and customize the therapy to the patient’s needs by adjusting the intensity and frequency of the electrical pulses.
We have developed a significant clinical data set that demonstrates the safety, effectiveness, patient adherence, and durable benefits of Barostim Therapy. Our BeAT-HF pivotal trial, which was a multi-center, prospective, randomized, controlled trial, met the primary safety and effectiveness endpoints and demonstrated meaningful improvement in the quality of life, both physically and emotionally, for patients suffering from HFrEF. These results led to FDA Premarket Approval (“PMA”) of Barostim in August 2019 on an accelerated basis of only four months from the submission of the clinical trial report.
The BeAT-HF pivotal trial continued enrolling patients in the post-market stage of the trial in order to gather and evaluate additional, long-term data. In December 2023, the FDA approved expanded labeling for Barostim based on the BeAT-HF trial data, resulting in simplification and clarification of the indications for use, as well as inclusion of the primary endpoint results, the 6, 12 and 24 month symptomatic data, the Win Ratio and the all-cause mortality data in the “Clinical Summary” discussion included in Barostim’s indications for use. We currently believe, using a prevalence-based epidemiologic model, our market opportunity in the U.S. is an estimated $10.5 billion, or 339,000 patients.
We continue to develop and expand upon our significant body of published clinical evidence that supports the meaningful benefits of Barostim Therapy. We are investigating the benefits of Barostim in an expanded population of patients with HF with mildly Reduced Ejection Fraction (“HFmrEF”) and HFrEF with NT-proBNP < 5,000 pg/mL in a large, multi-center, randomized controlled trial. If successful, we believe that our market
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opportunity in the U.S. could increase to an estimated $30.5 billion or 983,000 patients using a prevalence-based epidemiologic model. We are also analyzing data from U.S. and European Union (“EU”) patient registries and other real world evidence (“RWE”) datasets, in order to evaluate and assess a comprehensive view of outcomes from HFrEF patients who have been implanted with Barostim. We are continuing to invest in investigator-sponsored studies, driven by the strong interest of independent clinicians seeking to further validate the mechanisms underlying the device’s benefits.
We primarily sell Barostim to hospitals through a direct sales organization in the U.S. and Germany and through distributors in Austria, Spain, and other European countries. Our global sales and marketing team engages in sales efforts and promotional activities focused on HF specialists, interventional cardiologists, general cardiologists, advanced practice providers (“APPs”), electrophysiologists (“EPs”), vascular surgeons, and cardiothoracic surgeons. We are prioritizing our sales and marketing efforts on high volume cardiology centers that are strategically located and on educating and training physicians. We support all aspects of the patient journey, which includes initial diagnosis, surgical support, and patient follow-up. We also highlight our compelling clinical benefits and value proposition to build awareness and adoption among physicians through targeted key opinion leader (“KOL”) development, referral network education and direct-to-consumer marketing. We utilize direct communication channels to inform and educate patients about Barostim Therapy and utilize a qualification process to aid in the identification of the appropriate patients for our therapy. In the U.S., Barostim is reimbursed by the Centers for Medicare and Medicaid Services (“CMS”) across all regions. We assist with reimbursement approvals, if required. We plan to continue actively expanding our direct sales force and commercial organization in the U.S., which is where we expect to focus most of our sales and marketing efforts in the near-term.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
We are a commercial-stage medical device company focused on developing, manufacturing, and commercializing innovative and minimally invasive neuromodulation solutions for patients with cardiovascular disease. Our proprietary platform technology, Barostim, is designed to leverage the power of the brain and nervous system to address the imbalance of the Autonomic Nervous System, which causes HF with reduced Ejection Fraction (“HFrEF”) and other cardiovascular diseases. Our second-generation product, Barostim, is the first and only commercially available neuromodulation device indicated to improve symptoms for patients with HFrEF. Barostim provides Baroreflex Activation Therapy by sending imperceptible and persistent electrical pulses to baroreceptors located in the wall of the carotid artery to signal the brain to modulate cardiovascular function. Barostim is currently indicated by the U.S. Food and Drug Administration (“FDA”) for patients who are NYHA Class III or II (who had a recent history of Class III) despite treatment with guideline-directed medical therapies (medications and devices), have a LVEF ≤ 35% and a NT-proBNP < 1,600 pg/ml and is CE Marked for HFrEF and resistant hypertension.
Since our inception, our activities have consisted primarily of developing Barostim Therapy, conducting our BeAT-HF pre-market and post-market pivotal studies in the U.S., and filing for regulatory approvals. Our ability to generate significant revenue from product sales and become profitable will depend on our ability to continue to successfully commercialize Barostim and any product enhancements we may advance in the future. We expect to derive future revenue by continuing to both expand our own dedicated salesforce and increase awareness of Barostim among payers, physicians, and patients.
Our sales and marketing efforts are directed at electrophysiologists, HF specialists, interventional and general cardiologists, and vascular surgeons because they are the primary users of our technology. However, we consider hospitals, where the procedures are performed primarily in an outpatient setting, to be our customers, as they are the purchasing entities of Barostim in the U.S. We intend to continue making significant investments building our U.S. commercial infrastructure by expanding and training our U.S. sales force. We have dedicated significant resources to educate physicians and advanced practice providers who treat HFrEF about the advantages of Barostim and train them on the implant procedure.
The costs for the device and implantation procedure are reimbursed through various third-party payers, such as government agencies and commercial payers. In the U.S., we estimate that 67% of our target patient population is Medicare-eligible based on the age demographic of the HFrEF patient population indicated for Barostim. As a result, we have prioritized coverage by the Centers for Medicare and Medicaid Services while simultaneously developing processes to engage commercial payers. All Medicare Administrative Contractors have retired their official automatic coverage denial policies for our Current Procedural Terminology (“CPT”) codes, thereby allowing hospitals to submit payment requests for the Barostim procedure to be adjudicated on a claim-by-claim basis. Our reimbursement strategy involves continuing to broaden our current coverage and build our in-house market access team to obtain appropriate prior authorization approvals in advance of
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treatment on a case-by-case basis where positive coverage policies currently do not exist. Outside the U.S., reimbursement levels vary by country and within some countries by region. Barostim is eligible for reimbursement in certain countries in the European Economic Area, such as Germany, where annual healthcare budgets for the hospital generally determine the number of patients to be treated and the prices to be paid for the related devices that may be purchased.
We manage all aspects of manufacturing operations and product supply of Barostim, which include final assembly, testing and packaging of our implantable pulse generator (“IPG”) and stimulation lead, at our headquarters in Minneapolis, Minnesota. We utilize components or various subassemblies manufactured by third-party suppliers, some of which have significant lead times. Many of these components are from a limited number of suppliers. We believe that our component manufacturers are recognized in their field for their competency to manufacture the respective portions of Barostim and have quality systems established that meet FDA requirements. We seek to maintain higher levels of inventory to protect ourselves from supply interruptions and continue to seek to broaden and strengthen our supply chain through additional sourcing channels.
On October 31, 2022, we entered into the Loan Agreement allowing borrowing, subject to our achievement of certain milestones, up to a total of $50.0 million in a series of Term Loans described in Note 4 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. On January 9, 2026, we entered into an Amendment to our existing Loan Agreement. Pursuant to the Amendment, the terms loans available were increased by $50.0 million, to an aggregate principal amount of up to $100.0 million, subject to our achievement of certain milestones, and the maturity date was extended to 2031. We had $60.0 million in outstanding Term Loans under the Loan Agreement as of March 31, 2026.
As a result of the planned investments to fund our commercialization efforts, we expect to continue to incur net losses for the next several years, which may require additional funding and could include future equity and debt financing.
Recent developments
As previously disclosed, the Category I CPT codes for Baroreflex Activation Therapy using our Barostim device replaced Category III codes as of January 1, 2026, which eliminates the automatic denials regularly seen with Category III codes and improves prior authorization predictability to fairly pay physicians for the procedure. Early data in 2026 showed an increase in the 30-day approval rate for Medicare Advantage prior authorizations managed by our in-house market access team. At the same time that payers were incorporating this coding change, other regulatory changes took effect January 1, 2026 that accelerated the deadline for Medicare Advantage payers to respond to prior authorization requests. We believe this caused Medicare Advantage payers to respond with a higher rate of initial denials as the quarter progressed, which slowed the 30-day approval rate for March 2026. As a result, the 30-day approval rate for Medicare Advantage prior authorizations managed by our in-house market access team increased from 31% in 2024 to 44% in 2025 and to 46% for the first quarter of 2026. We expect the overall approval rate to continue to increase, although the speed of approval may be temporarily delayed.
In November 2025, the FDA granted an investigational device exemption (“IDE”) study designed as a prospective, multi-center, randomized controlled trial to evaluate the Barostim device’s impact on all-cause mortality and HF decompensation events in an expanded population of HF patients. In January 2026, we initiated the trial, supported by CMS Category B IDE coverage. We expect to begin enrolling the trial across approximately 150 centers in the first half of 2026 and complete enrollment within five years. The trial provides for a two-year follow-up period, resulting in the expected conclusion of the trial in five to seven years. On March 31, 2026, the first site was activated in the BENEFIT-HF trial and the first patient was enrolled in the second quarter of 2026.
On January 9, 2026, we entered into an Amendment to our existing Loan Agreement. Pursuant to the Amendment, the terms loans available were increased by $50.0 million, to an aggregate principal amount of
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up to $100.0 million, subject to our achievement of certain milestones, and the maturity date was extended to 2031. On the closing date, we borrowed an additional $10.0 million under the Loan Agreement.
On January 12, 2026, we entered into the Sale Agreement with Jefferies LLC, as agent. Pursuant to the terms of the Sale Agreement, we may offer and sell, from time to time at our sole discretion, shares of common stock having an aggregate offering price up to $50.0 million in an ATM offering, to or through the agent.
Factors affecting our performance
We believe there are several important factors that have impacted and that we expect will continue to impact our business and results of operations. These factors include:
| ● | Growing and supporting our U.S. commercial organization; |
| ● | Promoting awareness among physicians, hospitals, and patients to accelerate adoption of Barostim; |
| ● | Continuing to develop and disseminate clinical evidence supporting the benefits of Barostim; |
| ● | Raising awareness among payers to build upon reimbursement for Barostim; |
| ● | Investing in research and development to foster innovation; and |
| ● | Leveraging our manufacturing capacity to further improve our gross margins. |
Components of results of operations
Revenue
Our U.S. sales have steadily increased since the pre-market approval of Barostim by the FDA in August 2019, and the subsequent reimbursement changes. We expect to continue to drive increases in revenue through our efforts to increase awareness of Barostim among physicians, patients and payers, and by the expansion of our U.S. sales force, as well as by seeking expanded labeling for Barostim. As a result, we expect that U.S. sales will continue to account for the majority of our revenue going forward.
We derive a portion of our revenue from the sale of Barostim to hospitals in Germany and other select countries in Europe. Revenue from sales of Barostim in Europe fluctuates based on the average selling price of Barostim as determined by location of sale and channel mix, each of which may vary significantly from country to country. Our revenue from international sales can also be significantly impacted by fluctuations in foreign currency exchange rates.
Cost of goods sold and gross margin
Cost of goods sold consists primarily of acquisition costs of the components and subassemblies of Barostim, allocated manufacturing overhead and scrap and inventory obsolescence, as well as distribution-related expenses such as logistics and shipping costs. We expect cost of goods sold to increase in absolute dollars primarily as, and to the extent, our revenue grows. Gross margin may also vary based on regional differences in rebates and incentives negotiated with certain customers.
We calculate gross margin as revenue less cost of goods sold divided by revenue. Our gross margin has been and will continue to be affected by a variety of factors, but is primarily driven by the average sale price of our product, the percentage of products sold that include a full system (i.e., an IPG and a stimulation lead), as compared to individual IPG sales, and the allocated manufacturing overhead. Although we sell the majority of our devices directly to hospitals, the impact of the average selling price on gross margin is driven by
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the percentage of products we sold to distributors as compared to those sold directly to hospitals, as our average selling price is typically higher on products we sell directly. The full system sales typically have a lower gross margin as they include the cost of an IPG and a stimulation lead whereas individual IPG sales only include the cost of an IPG. The manufacturing overhead costs of Barostim are directly aligned to our production volume and therefore the cost per product is reduced if production levels increase. While we expect our gross margin to be positively affected over time to the extent we are successful in selling more product through our direct sales force and by increasing our production volumes, it will likely fluctuate from period to period as we continue to introduce new or modified products and adopt new manufacturing processes and technologies.
Research and development expenses
Research and development (“R&D”) expenses consist primarily of personnel costs, including salaries, bonuses, employee benefits and stock-based compensation expenses for our R&D employees. R&D expenses also include costs associated with product design efforts, development prototypes, testing, clinical trial programs and regulatory activities, contractors, consultants, equipment and software to support our development, facilities, and information technology. We expense R&D costs as they are incurred. We expect R&D expenses to increase in absolute dollars as we continue to develop enhancements to Barostim. Our R&D expenses may fluctuate from period to period due to the timing and extent of our product development and clinical trial expenses.
Selling, general and administrative expenses
Selling, general and administrative (“SG&A”) expenses consist primarily of personnel costs, including base salaries, bonuses, employee benefits and stock-based compensation expense for our sales and marketing personnel, including sales commissions, and for administrative personnel that support our general operations such as executive management, financial accounting, information technology and human resources personnel. SG&A expenses also include costs attributable to marketing, as well as travel, legal fees, financial audit fees, insurance, fees for other consulting services, depreciation, and facilities. We expense commissions at the time of the sale.
We expect SG&A expenses to increase in absolute dollars as we continue to expand our direct sales force and commercial organization in the U.S. In addition, we will continue to increase our international presence and to develop and assist our channel partners. However, we expect our SG&A expenses to decrease as a percentage of revenue as our revenue grows.
Interest expense
Interest expense consists of interest on our debt and amortization of associated financing costs.
Other income, net
Other income, net consists primarily of interest income on our interest-bearing accounts, partially offset by the effect of exchange rates on our foreign currency-denominated asset and liability balances.
Benefit (provision) for income taxes
Benefit (provision) for income taxes consists primarily of income taxes in foreign jurisdictions in which we conduct business. We maintain a full valuation allowance for deferred tax assets including NOL carryforwards, R&D credits, and other tax credits.
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Results of operations
Consolidated results of operations for the three months ended March 31, 2026, compared to the three months ended March 31, 2025
| | | | | | | | | | | | |
| | Three months ended | | | | | |
| ||||
| | March 31, | | Change | | |||||||
(unaudited and in thousands) | | 2026 | | 2025 | | $ | | % |
| |||
Revenue | | $ | 14,769 | | $ | 12,348 | | $ | 2,421 |
| 20 | % |
Cost of goods sold | |
| 1,888 | |
| 2,036 | |
| (148) |
| (7) | % |
Gross profit | |
| 12,881 | |
| 10,312 | |
| 2,569 |
| 25 | % |
Gross margin | |
| 87 | % |
| 84 | % |
| |
| | |
Operating expenses: | |
| | |
| | |
| |
| | |
Research and development | |
| 3,084 | |
| 2,517 | |
| 567 |
| 23 | % |
Selling, general and administrative | |
| 21,958 | |
| 21,232 | |
| 726 |
| 3 | % |
Total operating expenses | |
| 25,042 | |
| 23,749 | |
| 1,293 |
| 5 | % |
Loss from operations | |
| (12,161) | |
| (13,437) | |
| 1,276 |
| (9) | % |
Interest expense | |
| (1,551) | |
| (1,457) | |
| (94) |
| 6 | % |
Other income, net | |
| 593 | |
| 1,123 | |
| (530) |
| (47) | % |
Loss before income taxes | |
| (13,119) | |
| (13,771) | |
| 652 |
| (5) | % |
Benefit (provision) for income taxes | |
| (1) | |
| 5 | |
| (6) |
| (120) | % |
Net loss | | $ | (13,120) | | $ | (13,766) | | $ | 646 |
| (5) | % |
The following table provides revenue by geography:
| | | | | | | | | | | | |
| | Three months ended | | | | | | | ||||
| | March 31, | | Change | | |||||||
(unaudited and in thousands) | | 2026 | | 2025 | | $ | | % |
| |||
United States | | $ | 13,650 | | $ | 11,202 | | $ | 2,448 |
| 22 | % |
Europe | |
| 1,119 | |
| 1,146 | |
| (27) |
| (2) | % |
Total Revenue | | $ | 14,769 | | $ | 12,348 | | $ | 2,421 |
| 20 | % |
Revenue was $14.8 million for the three months ended March 31, 2026, an increase of $2.4 million, or 20%, over the three months ended March 31, 2025.
Revenue generated in the U.S. was $13.7 million for the three months ended March 31, 2026, an increase of $2.4 million, or 22%, over the three months ended March 31, 2025. Revenue units in the U.S. totaled 429 and 359 for the three months ended March 31, 2026 and 2025, respectively. The increases were primarily driven by continued growth in the U.S. HF business as a result of the expansion into new sales territories, new accounts, and increased physician and patient awareness of Barostim.
As of March 31, 2026, we had a total of 257 active implanting centers in the U.S., as compared to 227 as of March 31, 2025. Active implanting centers are customers that have completed at least one commercial HF implant in the last 12 months. As of March 31, 2026, we had a total of 56 sales territories in the U.S. as compared to 45 sales territories as of March 31, 2025.
Revenue generated in Europe was $1.1 million for the three months ended March 31, 2026, a $27,000 decrease, or 2%, compared to the three months ended March 31, 2025. Total revenue units in Europe decreased to 56 for the three months ended March 31, 2026, as compared to 59 in the prior year period. We had five sales territories in Europe as of March 31, 2026 and March 31, 2025.
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Cost of goods sold and gross margin
Cost of goods sold decreased $0.1 million, or 7%, to $1.9 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This decrease was driven by a lower cost per unit, primarily due to an increase in manufacturing efficiencies.
Gross profit was $12.9 million for the three months ended March 31, 2026, an increase of $2.6 million, or 25%, over the three months ended March 31, 2025. Gross margin increased to 87% for the three months ended March 31, 2026, compared to 84% for the three months ended March 31, 2025. Gross margin for the three months ended March 31, 2026 was higher due to an increase in the average selling price and a decrease in the cost per unit, primarily due to an increase in manufacturing efficiencies.
Research and development expenses
R&D expenses increased $0.6 million, or 23%, to $3.1 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This change was driven by a $0.4 million increase in consulting expenses, a $0.3 million increase in compensation expenses, and a $0.1 million increase in non-cash stock-based compensation expenses, partially offset by a $0.2 million decrease in clinical trial expenses.
Selling, general and administrative expenses
SG&A expenses increased $0.7 million, or 3%, to $22.0 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This change was primarily driven by a $1.0 million increase in compensation expenses and a $0.3 million increase in non-cash stock-based compensation expenses, partially offset by a $0.3 million decrease in consulting expenses and a $0.3 million decrease in advertising expenses.
Interest expense
Interest expense increased $0.1 million for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This increase was driven by the interest expense on higher levels of borrowings under the Loan Agreement.
Other income, net
Other income, net was $0.6 and $1.1 million for the three months ended March 31, 2026 and 2025, respectively. These balances consisted of interest income on our interest-bearing accounts. The decrease was primarily driven by the lower cash balance.
Benefit (provision) for income taxes
Benefit (provision) for income taxes was nominal for each of the three months ended March 31, 2026 and 2025.
Liquidity, capital resources and plan of operations
We have incurred significant operating losses and negative cash flows from operations since our inception, and we anticipate that we will incur significant losses for at least the next several years. As of March 31, 2026 and December 31, 2025, we had cash and cash equivalents of $72.3 million and $75.7 million, respectively. For the three months ended March 31, 2026 and 2025, our net losses were $13.1 million and $13.8 million, respectively. Our net cash used in operating activities for the three months ended March 31, 2026 and 2025 was $12.2 million and $12.8 million, respectively.
On October 31, 2022, we entered into the Loan Agreement under which we were allowed to borrow, subject to our achievement of certain milestones, up to a total of $50.0 million in a series of Term Loans described in
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Note 4 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. On January 9, 2026, we entered into an Amendment to our existing Loan Agreement. Pursuant to the Amendment, the terms loans available were increased by $50.0 million, to an aggregate principal amount of up to $100.0 million, subject to our achievement of certain milestones. On the closing date, we borrowed an additional $10.0 million under the Loan Agreement. We had $60.0 million in outstanding Term Loans under the Loan Agreement as of March 31, 2026.
On November 4, 2022, we entered into an Equity Distribution Agreement with Piper Sandler & Co., as agent, under which we may offer and sell, from time to time at our sole discretion, shares of our common stock having an aggregate offering price of up to $50.0 million in an ATM offering, to or through the agent. We issued 543,462 shares of common stock for gross proceeds of $9.5 million during the year ended December 31, 2025. On November 4, 2025, we and the agent mutually agreed to terminate the Equity Distribution Agreement for the ATM, effective on November 6, 2025. On January 12, 2026, we entered into a Sale Agreement with Jefferies LLC, as agent. Pursuant to the terms of the Sale Agreement, we may offer and sell, from time to time at our sole discretion, shares of common stock having an aggregate offering price up to $50.0 million in an ATM offering, to or through the agent.
Our future liquidity and capital funding requirements will depend on numerous factors, including:
| ● | our investment in our U.S. commercial infrastructure and sales forces; |
| ● | the degree and rate of market acceptance of Barostim and the ability for our customers to obtain appropriate levels of reimbursement; |
| ● | the costs of commercialization activities, including product sales, marketing, manufacturing, and distribution; |
| ● | our R&D activities for product enhancements and to expand our indications; |
| ● | the costs of filing, prosecuting, defending, and enforcing any patent claims and other intellectual property rights; |
| ● | our need to implement additional infrastructure and internal systems; |
| ● | our ability to hire additional personnel to support our operations as a public company; and |
| ● | the emergence of competing technologies or other adverse market developments. |
We believe that our existing cash resources together with cash from operations will be sufficient to meet our forecasted requirements for operating liquidity, capital expenditures and debt services for at least the next two years. If these sources are insufficient to satisfy our liquidity requirements, or provide funding to execute or accelerate our growth strategies, however, we may seek to sell additional equity or enter into an additional loan agreement. If we raise additional funds by issuing equity securities, our stockholders would experience dilution. Additional debt financing, if available, may involve covenants further restricting our operations or our ability to incur additional debt. Any such debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders.
Additional financing may not be available at all or may only be available in amounts or on terms that we do not deem to be favorable. If we are unable to obtain additional financing when needed to satisfy our liquidity requirements, we may be required to delay the commercialization and marketing of Barostim.
27
Cash flows
The following table sets forth the primary sources and uses of cash for each of the periods presented below:
| | | | | | |
| | Three months ended | ||||
| | March 31, | ||||
| | (unaudited) | ||||
(in thousands) | | 2026 | | 2025 | ||
Net cash (used in) provided by: |
| | |
| | |
Operating activities | | $ | (12,164) |
| $ | (12,767) |
Investing activities | |
| (122) |
|
| (114) |
Financing activities | |
| 8,882 |
|
| 9,615 |
Effect of currency exchange on cash and cash equivalents | |
| (1) |
|
| 1 |
Net change in cash and cash equivalents | | $ | (3,405) |
| $ | (3,265) |
Cash used in operating activities
Net cash used in operating activities for the three months ended March 31, 2026 was $12.2 million and consisted primarily of a net loss of $13.1 million, partially offset by a non-cash charge of $2.9 million related to stock-based compensation expense, and a change in net operating assets of $2.2 million. Net operating assets consisted primarily of accrued expenses, accounts receivable, accounts payable, inventory, and prepaid expenses and other current assets to support the growth of our operations.
Net cash used in operating activities for the three months ended March 31, 2025 was $12.8 million and consisted primarily of a net loss of $13.8 million and a change in net operating assets of $1.7 million, partially offset by a non-cash charge of $2.5 million related to stock-based compensation expense.
Cash used in investing activities:
Cash used in investing activities was $0.1 million for each of the three months ended March 31, 2026 and 2025, respectively, and consisted of purchases of property and equipment.
Cash provided by financing activities:
Net cash provided by financing activities for the three months ended March 31, 2026 was $8.9 million and consisted primarily of $10.0 million related to net proceeds from debt financing partially offset by $1.1 million related to the debt financing costs.
Net cash provided by financing activities for the three months ended March 31, 2025 was $9.6 million and consisted of $9.2 million related to net proceeds from the issuance of common stock through the ATM offering and $0.4 million related to proceeds from the exercise of common stock options.
Contractual obligations and commitments
There have been no material changes to our contractual obligations as of March 31, 2026, as compared to those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.
Critical accounting policies and estimates
For a discussion of our potential risks and uncertainties, see the information in Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations—Critical accounting policies and estimates" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. We have reviewed and determined that those critical accounting policies and estimates remain our critical accounting policies and estimates as of and for the three months ended March 31, 2026.
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Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-08-13 | Binkowski Brent | CHIEF OPERATING OFFICER | Buy | +26,223 | $2.91 | $76,432 |
| 2026-08-12 | Binkowski Brent | CHIEF OPERATING OFFICER | Sell | -1,309 | $2.55 | -$3,338 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-11-07 10-Q expected by 2026-11-11 (in 74 days)
- ~2027-02-10 10-K expected by 2027-02-26 (in 169 days)
- ~2027-05-13 10-Q expected by 2027-05-17 (in 261 days)
- ~2027-08-07 10-Q expected by 2027-08-11 (in 347 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-11 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-08-06 8-K Earnings Release; Financial Statements and Exhibits
- 2026-08-06 10-Q Quarterly Report
- 2026-06-09 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-05-12 10-Q Quarterly Report
- 2026-05-11 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-13 8-K Earnings Release; Other Events; Financial Statements and Exhibits
- 2026-03-03 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-02-13 10-K Annual Report
- 2026-02-12 8-K Earnings Release; Financial Statements and Exhibits
- 2026-01-12 8-K Material Agreement Entered; Financial Statements and Exhibits
- 2026-01-12 8-K Material Agreement Entered; Earnings Release; Material Financial Obligation; Other Events; Financial Statements and Exhibits
- 2025-11-06 10-Q Quarterly Report
- 2025-11-06 S-3 Registration Statement
- 2025-11-05 8-K Earnings Release; Financial Statements and Exhibits