MEDFORD, Mass., Nov. 14, 2018 /PRNewswire/ -- INVO Bioscience, Inc. (IVOB), a medical device company who was granted FDA clearance for the first Intravaginal Culture System, INVOcell™, today announced its Q3 2018 financial results or the quarter ended September 30, 2018 and recent highlights.
Financial Results and Recent Highlights:
- Entered exclusive U.S. licensing agreement with Ferring International Center S.A. the parent Company of Ferring Pharmaceuticals U.S. to commercialize the novel INVOcell™ system for use in the treatment of infertility on November 13, 2018. Agreement expected to close in January 2019;
- Revenue for Q3 2018 increased 83% at $125,035, compared to $68,220 for the same period a year ago;
- Gross margins improved during Q3 2018 to 88% compared to 81% in Q3 2017;
- Net loss was $(294,860) during Q3 2018 compared to $(148,848) in Q3 2017;
- The company continues to garner significant media attention, including mentions in:
Katie Karloff, Chair and Chief Executive Officer of INVO Bioscience, commented, "Our hard work in elevating the visibility of the INVOcell within the reproductive services community nationwide is beginning to pay meaningful dividends as more clinics are adding INVOcell to their menu of services. We believe this will only accelerate due to our new exclusive distribution agreement with Ferring Pharmaceuticals to commercialize INVOcell in the U.S. market. Ferring has considerable commercial strength and market presence within the fertility market and understands the unique opportunity that INVOcell provides to revolutionize fertility treatment. Ferring is a natural partner to help INVO Bioscience accomplish its mission to increase access to care and expand fertility treatment in the U.S."
Ms. Karloff continued, "With the U.S. product distribution business in the capable hands of Ferring, INVO Bioscience will now focus its efforts on developing and opening INVO-branded fertility centers throughout the U.S. and broadly introducing the INVOcell product internationally. Given the INVOcell record of achieving safe and more cost-effective pregnancies than traditional in-vitro fertilization treatments, we believe there is significant potential in U.S. branded clinics and that markets in Europe and Asia, that face similar fertility issues as the U.S., have the potential to become important markets for INVOcell. We are excited with the opportunities ahead."
Robert Bowdring, Treasurer & Director, added, "With the Ferring agreement set to be finalized in January 2019, and with it an upfront cash payment, we have accomplished an important milestone. We will now turn our sites to future opportunities, including meeting the necessary requirements to up list our stock onto one of the national stock exchanges. We believe that our shareholders are entitled to the enhanced visibility and liquidity that Nasdaq or the New York Stock Exchange American can offer. This is a very exciting time in the history of INVO Bioscience and is reflective of the hard work and dedication of the entire team, and the support of our loyal shareholders, to get us to this point. We look forward with great enthusiasm."
Terms of U.S. Distribution Agreement
Under the terms of the license and supply agreement, INVO Bioscience will receive an upfront cash payment, is eligible to receive a second additional milestone payment based upon the successful completion of the INVOcell product label enhancement and will receive payment for the supply of each INVOcell device. Additionally, Ferring is obligated, subject to certain conditions, to achieve defined minimum revenue targets over the next seven years. INVO Bioscience will be responsible for manufacturing and supplying INVOcell to Ferring for commercial sales and to obtain a five (5) day label enhancement from the FDA for the current incubation period for the product. INVO Bioscience also retains certain limited rights to establish INVO clinics that exclusively commercialize INVO cycles and will retain commercialization rights outside the U.S. The agreement is expected to close in January 2019, subject to customary closing conditions.
Further terms of the agreement can be found in an 8-K filed by INVO Bioscience on November 14, 2018 with the SEC. Please click here to access the report.
Q3 2018 Financial Results
Net sales and revenues for quarter ended September 30, 2018 were $125,035 compared to $68,220 for the same three-month period ended September 30, 2017; an increase of 83%.
Cost of goods sold for the three months ended September 30, 2018 were $15,369 or approximately 12% of revenues compared to $12,827 or approximately 19% of revenues for the quarter ended September 30, 2017. The improvement in gross margin was related primarily to the 83% increase in product revenue, and 2018 price increase on reorders compared to 2017 introductory sales promotions.
Selling, general and administrative (SG&A) expenses for the three months ended September 30, 2018 were $299,548 million as compared to $199,691 for the three months ended September 30, 2017.
Adjusted EBITDA, which is a non-GAAP measure of operating performance, was $(189,882) during Q3 2018, compared to $(144,298) during Q3 2017. The company continues to keep expenses at a minimum.
Net loss for the quarter was $(294,860), or $(0.00) per share, compared with $(148,848), or $(0.00) per share a year ago.
The Company ended the quarter with $547,966 in cash and equivalents. As disclosed, upon completion of the U.S. distribution agreement anticipated to be completed in January 2019, the company will received a significant infusion of cash to begin to execute its business plan.
Additional details pertaining to the quarterly financials can be found in our 10-Q filed today with the SEC.
Use of Non-GAAP Measure
Adjusted EBITDA is presented herein and is a non-GAAP measure. However, this measure is not intended to be a substitute for those financial measures reported in accordance with GAAP. Adjusted EBITDA has been included because management believes that, when considered together with the GAAP figures, it provides meaningful information related to our operating performance and liquidity and can enhance an overall understanding of financial results and trends. See our attached financials for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.
About INVO Bioscience
We are a medical device company focused on creating simplified, lower cost treatments for patients diagnosed with infertility. Our solution, the INVO Procedure, is a disruptive new technology. The INVO Procedure is a revolutionary in vivo method of vaginal incubation that offers patients a more natural and intimate experience. Our lead product, the INVOcell, is a patented medical device used in infertility treatment and is considered an Assisted Reproductive Technology (ART). The INVOcell is the first Intravaginal Culture (IVC) system in the world used for the natural in vivo incubation of eggs and sperm during fertilization and early embryo development, as an alternative to traditional In Vitro Fertilization (IVF) and Intrauterine Insemination (IUI). Our mission is to increase access to care and expand fertility treatment across the globe with a goal to lower the cost of care and increase availability of care. For more information, please visit http://invobioscience.com/
Safe Harbor Statement
This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company invokes the protections of the Private Securities Litigation Reform Act of 1995. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategies, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. Factors that may cause actual results to differ materially from those in the forward-looking statements include those set forth in our filings at www.sec.gov. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
Kathleen Karloff, CEO INVO Bioscience, Inc. 978-878-9505 ext. 504
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