Business Context and Reporting Period
This Form 8-K was filed by Second Sight Medical Products, Inc. on January 7, 2019, reporting a business update for the fourth quarter and full year 2018. The company develops and markets the Argus II Retinal Prosthesis System and is conducting feasibility studies for the Orion system.
Key Financial Metrics
- Revenue: Estimated net sales for the full year 2018 are in the range of $6.5 million to $6.9 million.
- Cash and Liquidity: As of December 31, 2018, the company held $4.5 million in cash and cash equivalents.
- Implant Volume: 16 Argus II systems were implanted in Q4 2018, bringing the 2018 total to 69 implants.
- Cost Savings: A restructuring of operations outside North America is expected to yield approximately $3 million in annual operating expense savings.
- Capital Raise: The company announced a rights offering to raise approximately $40 million.
Material Changes and Operational Updates
The filing highlights the completion of a restructuring plan for non-North American operations to align with corporate strategy. Additionally, the Orion feasibility study has progressed with five subjects implanted and a sixth scheduled for January 2019. Performance of Orion subjects appears comparable to Argus II users, with a strong safety profile noting only one Serious Adverse Event (SAE).
Guidance, Outlook, and Risks
Management indicated that the $40 million rights offering is intended to support ongoing corporate initiatives. The filing does not provide specific forward-looking revenue guidance beyond the 2018 estimates or detailed risk factors beyond the standard operational context of a medical device company in development phases.
Investor Verification Checklist
- Verify the final audited net sales figure for 2018 against the estimated $6.5 - $6.9 million range.
- Confirm the status and terms of the announced $40 million rights offering.
- Monitor the safety and performance data of the Orion feasibility study as additional subjects are implanted.
- Assess the impact of the $3 million annual cost savings on future operating margins.