Endologix releases Q2, updates on Nellix discussions with FDA

Endologix (NSDQ:ELGX) on Wednesday released 2nd quarter earnings and updated on its discussions with the FDA over its Nellix system for treating abdominal aortic aneurysms, saying the agency is requesting additional information and may need an Advisory Committee Panel before it can obtain approval.

The company said that without a required panel, it is hopeful it will receive premarket approval from the FDA for the device in the 1st quarter of 2017. With a required panel, the company expects approval some time in the 3rd quarter of 2017.

“In July, we completed our 100-day PMA meeting with the FDA and remain confident in the approvability of Nellix. The FDA has requested additional information related to our PMA submission and also indicated that we might need to go to an Advisory Committee Panel given the novelty of EVAS compared to traditional EVAR. If we do not have to go to panel, we still believe it’s possible to receive PMA approval in the first quarter of 2017. If we do have to go to panel, we believe that it pushes out the potential PMA approval into the third quarter of 2017. We are working very collaboratively with the FDA to provide the required information and remain confident in the PMA approval of Nellix based upon the IDE clinical results, data from other international studies and our worldwide experience which now includes over 6,000 patients,” CEO John McDermott said in prepared remarks.

The Irvine, Calif.-based company reported losses of $66.8 million, or 81¢ per share on sales of $51 million for the 3 months ended June 30. That amounts to a 414% gain in losses as sales grew 29.1% compared to the same period in 2015.

Adjusted to exclude 1-time items, losses per share were 20¢, right in line with what analysts on Wall Street were looking for from the company.

Shares dropped over 12% in post-market trading after the company released the earnings report, closing at $13.75 on August 2 and opening at $12.00 on August 3.

“We continue to deliver solid revenue growth above expectations and are very pleased with the TriVascular merger integration. Our revenue performance in the second quarter was driven by strong growth with Nellix in international markets, including the launch of our next generation system in Europe, and the full market release of AFX2 in the U.S. For Nellix, we reported several positive clinical data updates during the quarter, highlighted by the results from the EVAS FORWARD-IDE study. These data featured significantly lower rates of endoleaks and secondary interventions with Nellix, which further increases our confidence in its long-term potential to be a market leading device in the treatment of AAA,” McDermott said in a press release.

The company lifted its full year 2016 guidance, expecting to see revenue between $197 million and $203 million, up from the $192 million to $202 million the company previously released.

Endologic said it expects GAAP losses per share between $1.80 and $1.85, up significantly from the $1.20 to $1.30 it previously forecast. Adjusted losses per share are expected to be between 70¢ and 75¢.

In February, Endologix and TriVascular Technologies (NSDQ:TRIV) said they closed their $221 million merger, uniting 2 of the stent graft market’s smaller players.

Both companies makes devices for treating abdominal aortic aneurysms; Irvine, Calif.-based Endologix makes 2 lines of stent grants, the Nellix and AFX devices, while Santa Rosa, Calif.-based TriVascular makes the Ovation stent graft.

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