PRINCETON, N.J. - CytoSorbents Corporation (NASDAQ: CTSO), known for its blood purification technology used in critical care and cardiac surgery, has entered into a $20 million credit facility with Avenue Capital Group. The agreement, finalized on June 28, 2024, aims to bolster the company's financial position and support its global commercialization efforts for its CytoSorb® product line and upcoming regulatory submissions for DrugSorb™-ATR in the U.S. and Canada.
The new credit facility is structured to provide CytoSorbents with non-dilutive working capital, facilitating the company's ongoing operations and expansion. CytoSorb® has generated $32.2 million in sales over the past 12 months as of March 31, 2024, and the company anticipates that the additional capital will aid in the launch and commercialization of DrugSorb™-ATR, pending regulatory approval.
Kathleen Bloch, CFO of CytoSorbents, expressed confidence that the partnership with Avenue Capital Group would enable the company to confidently pursue its regulatory and commercialization objectives. She highlighted the potential market opportunity for DrugSorb™-ATR, which has been designated as an FDA Breakthrough Device, in addressing the significant medical need of reducing bleeding complications in patients on blood thinners undergoing surgery.
The credit facility will provide an initial tranche of $15 million, with immediate availability of $10 million. An additional $5 million is contingent upon the U.S. FDA's acceptance of the company's De Novo application for DrugSorb™-ATR and certain liquidity requirements. A second tranche of $5 million is expected to be available in the second half of 2025, subject to FDA marketing clearance, to support the anticipated launch of DrugSorb™-ATR in the United States.
Avenue Capital Group's Senior Portfolio Manager, Chad Norman, commented on the partnership, stating their long-term interest in CytoSorbents and its contributions to life-saving medical treatments. Avenue Capital Group is a global investment firm with approximately $12.5 billion in assets under management, and its involvement with CytoSorbents is seen as a strategic move to support the company's growth and product initiatives.
This financial move is based on the performance of CytoSorbents' leading product, CytoSorb®, which has been used in over 237,000 instances worldwide and has received approval in the European Union and distribution in 75 countries. The company continues to develop its portfolio of blood purification technologies, with multiple products in the pipeline.
The information in this article is based on a press release statement from CytoSorbents Corporation.
In other recent news, CytoSorbents Corporation has reported a 14% increase in product sales, totaling $9 million for the first quarter of 2024, along with an improved product gross margin of 76%. With a cash balance of $10.1 million, the company believes it has sufficient funding until the fourth quarter of 2024.
The company has also announced that its CytoSorb device has received regulatory approval from the Taiwan Food and Drug Administration. This device, designed to remove various harmful substances from the blood, will now be distributed in Taiwan by Hemoscien Corporation.
In addition, CytoSorbents is preparing to submit marketing applications for its DrugSorb-ATR system in the U.S. and Canada and anticipates the launch of its PuriFi hemoperfusion pump in select international markets.
InvestingPro Insights
As CytoSorbents Corporation (NASDAQ: CTSO) secures a $20 million credit facility to enhance its financial stability and further its commercialization efforts, it's worth noting the company's current financial health through real-time data from InvestingPro. With a market capitalization of $38.01 million, CytoSorbents shows a Price/Book ratio of 2.01 as of the last twelve months ending Q1 2024, indicating the market's valuation of the company relative to its book value.
Despite the company's proactive measures to expand its product line, InvestingPro Tips suggest that CytoSorbents is quickly burning through cash and that the stock has taken a significant hit over the last week, with a one-week price total return of -8.77%. Additionally, analysts are not optimistic about the company's profitability in the near term, which aligns with a reported operating income margin of -74.43% for the same period.
Investors interested in a deeper dive into CytoSorbents' financial outlook can find additional insights with InvestingPro. There are currently 6 more InvestingPro Tips available, which may provide further context on the company's performance metrics and stock movement. For those considering an InvestingPro subscription, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. This could be a valuable resource for stakeholders looking to make informed decisions based on comprehensive analysis.
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