NeuroPace Inc SEC 10-Q Report

NeuroPace Inc, a medical technology company focused on developing and commercializing innovative solutions for the treatment of neurological disorders, has released its Form 10-Q report for the third quarter. The report highlights significant improvements in both financial and operational performance, driven by increased sales of its RNS System and strategic business initiatives.

Financial Highlights

• Revenue: $22.5 million, increased by 24% compared to the same period last year, primarily due to an increase in the number of RNS System units sold.
• Gross Profit: $17.3 million, representing a 30% increase from the previous year, with a gross margin improvement from 73.6% to 77.0% due to lower fixed costs per unit and increased production volume.
• Loss from Operations: $(5.1) million, improved by 32% from the previous year, reflecting better operational efficiency.
• Net Loss: $(6.6) million, a reduction of 26% compared to the previous year, indicating improved financial performance.
• Net Loss Per Share: $(0.21), compared to $(0.32) in the previous year, reflecting a decrease in net loss per share due to improved financial results.

Business Highlights

• Revenue Segments: The company derives most of its revenue from sales of the RNS System to hospital facilities for both initial and replacement procedures. Additionally, revenue is generated from sales of DIXI Medical products, primarily to the existing customer base.
• Geographical Performance: Nearly all revenue is generated from sales within the United States, with limited sales in Canada under a special program for adult patients with drug-resistant focal epilepsy.
• Sales Units: The increase in revenue was primarily due to an increase in the number of RNS System units sold during the reporting period.
• New Product Launches: The company is conducting studies to expand the indication for use of the RNS System to patients with drug-resistant generalized epilepsy and those under the age of 18.
• Future Outlook: The company plans to file expanded label submissions to the FDA for new indications in the second half of 2025. It also intends to continue investing in clinical studies and next-generation technologies to improve the RNS System and broaden the patient population.
• Operational Strategy: The company is focused on promoting awareness of the RNS System through investments in training and education of clinicians, epilepsy centers, hospitals, and patients. It also plans to expand its sales force incrementally to address new opportunities.
• Partnerships: The company has a collaboration agreement with Rapport Therapeutics to leverage its data and RNS System’s biomarker monitoring capabilities in Rapport’s clinical trials.
• Distribution Agreement: The company has decided not to renew its exclusive distribution agreement with DIXI Medical USA Corp. upon its expiration in September 2025, but will continue to sell existing inventory during a six-month wind-down period.

SEC Filing: NeuroPace Inc [ NPCE ] - 10-Q - May. 13, 2025