Volatile stock to watch: TransMedics Group Inc (NASDAQ: TMDX)

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TransMedics Group Inc (NASDAQ: TMDX) stock fell 0.26% on June 11th, 2019 (Source: Google finance) after the company in the first quarter of FY 19 has reported the net loss of $6.9 million compared to $4.9 million in the first quarter of 2018. TMDX has reported 86% rise in the Net revenue for the first quarter of 2019 to $4.7 million. The increase in net revenue was primarily driven by commercial sales of OCS Lung products in the U.S. as well as OCS Liver disposable sets for clinical trial use. Gross margin for the first quarter of 2019 was 55% as compared to 37% in the first quarter of 2018. This increase in gross margin was primarily due to the increase in net revenue from sales of OCS disposable sets, higher average selling prices, and improved efficiency in production. Operating expenses for the first quarter of 2019 were $8.5 million compared to $5.7 million in the first quarter of 2018. The increase in operating expenses was primarily due to the expenses associated with supporting commercial sales of the OCS Lung in the United States, the preparation to operate as a public company, and spending associated with clinical trial activity. Cash and cash equivalents were $12.2 million as of March 30, 2019. In May 2019, TransMedics completed an initial public offering, raising approximately $97.4 million of net proceeds, after deducting underwriting discounts and commissions.

Volatile stock to watch: TransMedics Group Inc (NASDAQ: TMDX)

For FY 19, TransMedics projects net revenue to be in the range of $23.5 million to $25.5 million, which represents 81% to 96% growth compared to the company’s prior year net revenue.

Meanwhile, the company has recently received an FDA PMA approval for expanded clinical indications of the Organ Care System (OCS) Lung.  This approval will enable the OCS Lung System to be used for the preservation and ex-vivo assessment of both standard criteria donor lungs as well as the larger pool of donor lungs initially deemed unacceptable for procurement and transplantation based on limitations of cold static preservation. This approval will also enable the OCS Lung System to be used with both donors after brain death (DBD) and donors after circulatory death (DCD).  Prior to this latest FDA approval, the OCS Lung System was approved for standard criteria lungs from DBD donors only.  Based on this FDA PMA approval, TransMedics will expand its post-market Thoracic Organ Perfusion (TOP) Registry to collect long-term post-market data from recipients of all OCS Lung preserved standard criteria and initially deemed unacceptable donor lungs.

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