UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 6, 2014
Tandem Diabetes Care, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-36189 | 20-4327508 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) | ||
| 11045 Roselle Street, San Diego, CA | 92121 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (858) 366-6900
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On May 6, 2014, we issued a press release announcing our financial results for the quarter ended March 31, 2014. This press release has been furnished as Exhibit 99.1 to this report and is incorporated herein by this reference.
The information under this Item 2.02 and Exhibit 99.1 hereto is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or the Exchange Act, or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Number |
Description | |
| 99.1 | Press release of Tandem Diabetes Care, Inc. dated May 6, 2014. | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Tandem Diabetes Care, Inc. | ||
| Date: May 6, 2014 | /s/ David B. Berger | |
| David B. Berger | ||
| General Counsel | ||
INDEX TO EXHIBITS
| Number |
Description | |
| 99.1 | Press release of Tandem Diabetes Care, Inc. dated May 6, 2014. | |
Exhibit 99.1
FOR IMMEDIATE RELEASE
Tandem Diabetes Care Reports First Quarter 2014 Financial Results
San Diego, May 6, 2014 – Tandem Diabetes Care®, Inc. (NASDAQ: TNDM), a medical device company and manufacturer of the t:slim® Insulin Pump, today reported its financial results for the quarter ended March 31, 2014.
For the quarter ended March 31, 2014, sales grew 48 percent to $8.1 million, compared to $5.5 million for the same period of 2013. For the quarter ended March 31, 2014, pump shipments grew 102 percent to 1,723 t:slim Pumps, compared to 852 pumps for the same period of 2013. The growth rate for pump shipments exceeded the growth rate for sales, primarily due to $1.9 million of t:slim Pump sales recognized in the first quarter 2013 that were shipped in the fourth quarter of 2012. The sales were recognized in the first quarter of 2013 as a result of the t:slim Pump’s 30-day return policy and a lack of product returns history at the time of shipment.
“We continue to see a growing portion of our business come from people who are new to pump therapy, and are encouraged by our customers’ response to its easy-to-use features and modern design,” said Kim Blickenstaff, President and Chief Executive Officer of Tandem Diabetes Care. “With our recently expanded commercial sales organization, we expect to be well-positioned to further drive adoption in the insulin-dependent diabetes market.”
For the quarter ended March 31, 2014, gross margin was 11 percent compared to 37 percent for the same period of 2013. The primary reason for the change in gross margin was an increase in the per unit manufacturing overhead costs. Since the first quarter of 2013 the Company significantly increased manufacturing operations and costs to address increasing production requirements. Overhead costs for the first quarter of 2014 increased more than 50 percent compared to the same period of 2013.
For the first quarter of 2014, operating expenses totaled $21.7 million compared to $9.2 million for the same period of 2013. The increases in operating expenses are primarily associated with the expansion of commercial operations and non-cash, stock-based compensation.
Operating loss for the first quarter of 2014 was $20.8 million, compared to $7.2 million for the same period of 2013. This included non-cash, stock-based compensation of $3.8 million for the quarter ended March 31, 2014 compared to $56,000 for the comparable period of 2013.
As of March 31, 2013, the Company had $110.8 million in cash, cash equivalents and short-term investments.
For the year ending December 31, 2014, the Company reaffirms its prior guidance as follows:
| • | sales are estimated to be in the range of $48.0 million to $54.0 million, and |
| • | operating margin is estimated to be in the range of negative 130 percent to 140 percent, which includes approximately $17 million to $18 million in non-cash, stock-based compensation expense. |
Conference Call
The Company will hold a conference call and simultaneous webcast today at 4:30pm Eastern Time (1:30pm Pacific Time). The link to the webcast will be available by accessing the Investor Center of the Tandem Diabetes Care website at http://investor.tandemdiabetes.com, and will be archived for 30 days. To listen to the conference call via phone, please dial 855-427-4396 (U.S./Canada) or 484-756-4261 (International) and use the participant code “30932410”.
About Tandem Diabetes Care, Inc.
Tandem Diabetes Care, Inc. (www.tandemdiabetes.com) is a medical device company with an innovative, user-centric and integrated approach to the design, development and commercialization of products for people with insulin-dependent diabetes. The Company manufactures and sells the t:slim Insulin Pump, the slimmest and smallest durable insulin pump currently on the market, and the first and only insulin pump with a high resolution, color touch screen. Tandem is based in San Diego, California.
t:slim, t:connect and Tandem Diabetes Care are registered trademarks of Tandem Diabetes Care, Inc.
Follow Tandem Diabetes Care on Twitter @tandemdiabetes, use #tslim, #tconnect and $TNDM.
Follow Tandem Diabetes Care on Facebook at www.facebook.com/TandemDiabetes.
Forward Looking Statement
This press release contains “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, that concern matters that involve risks and uncertainties that could cause actual results to differ materially from those anticipated or projected in the forward-looking statements. These forward-looking statements relate to the Company’s projected financial results and the Company’s ability to further drive adoption of the t:slim® Insulin Pump in the insulin dependent diabetes market . The Company’s actual results may differ materially from those indicated in these forward-looking statements due to numerous risks and uncertainties. For instance, successful commercialization of the Company’s products may be negatively impacted by lack of market acceptance by physicians and people with diabetes. Other risks and uncertainties include the Company’s inability to manufacture products in commercial quantities at an acceptable cost and in accordance with quality requirements; the Company’s inability to contract with additional third-party payors for reimbursement of the Company’s products; possible delays in the Company’s product development programs; possible future actions of the U.S. Food and Drug Administration or any other regulatory body or governmental authority; and other risks identified in the Company’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, as well as other documents that the Company files with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Tandem undertakes no obligation to update or review any forward-looking statement in this press release because of new information, future events or other factors.
# # #
TANDEM DIABETES CARE, INC.
CONDENSED BALANCE SHEETS
(in thousands)
| March 31, 2014 | December 31, 2013 | |||||||
| (unaudited) | ||||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash, cash equivalents and short-term investments |
$ | 110,774 | $ | 129,480 | ||||
| Restricted cash |
2,050 | 2,050 | ||||||
| Accounts receivable, net |
3,423 | 5,299 | ||||||
| Inventory, net |
10,165 | 10,330 | ||||||
| Other current assets |
1,947 | 1,830 | ||||||
|
|
|
|
|
|||||
| Total current assets |
128,359 | 148,989 | ||||||
| Property and equipment, net |
10,814 | 9,886 | ||||||
| Other long term assets |
3,216 | 3,340 | ||||||
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|
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| Total assets |
$ | 142,389 | $ | 162,215 | ||||
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| Liabilities and stockholders’ equity |
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| Current liabilities: |
||||||||
| Accounts payable, accrued expense and employee-related liabilities |
$ | 10,117 | $ | 10,102 | ||||
| Deferred revenue |
383 | 411 | ||||||
| Other current liabilities |
2,636 | 4,086 | ||||||
|
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|
|
|||||
| Total current liabilities |
13,136 | 14,599 | ||||||
| Notes payable—long-term |
29,445 | 29,397 | ||||||
| Other long-term liabilities |
2,547 | 2,682 | ||||||
| Total stockholders’ equity |
97,261 | 115,537 | ||||||
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| Total liabilities and stockholders’ equity |
$ | 142,389 | $ | 162,215 | ||||
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TANDEM DIABETES CARE, INC.
CONDENSED STATEMENTS OF OPERATIONS
(in thousands – except per share data)
| Three Months Ended March 31, | ||||||||
| 2014 | 2013 | |||||||
| (Unaudited) | ||||||||
| Sales |
$ | 8,065 | $ | 5,458 | ||||
| Cost of sales |
7,198 | 3,418 | ||||||
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| Gross profit |
867 | 2,040 | ||||||
| Operating expenses: |
||||||||
| Selling, general and administrative |
18,041 | 6,884 | ||||||
| Research and development |
3,663 | 2,322 | ||||||
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|
|
|
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| Total operating expenses |
21,704 | 9,206 | ||||||
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| Operating loss |
(20,837 | ) | (7,166 | ) | ||||
| Other expense, net |
||||||||
| Other expense, net |
(1,125 | ) | (1,167 | ) | ||||
| Change in fair value of stock warrants |
— | (2,830 | ) | |||||
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| Total other expense, net |
(1,125 | ) | (3,997 | ) | ||||
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| Net loss |
$ | (21,962 | ) | $ | (11,163 | ) | ||
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| Net loss per share, basic and diluted |
$ | (0.96 | ) | $ | (53.77 | ) | ||
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| Weighted average shares used to compute basic and diluted net loss per share |
22,936 | 208 | ||||||
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Media Contact:
Steve Sabicer
714-907-6264
ssabicer@thesabicergroup.com
Investor Contact:
Susan Morrison
858-366-6900 x7005
smorrison@tandemdiabetes.com