Electromed announced the results of an independent, outcome-based clinical study presented during the third annual World Bronchiectasis Conference in Washington D.C. The study's findings reveal that early use of high frequency chest wall oscillation therapy with the SmartVest Airway Clearance System significantly reduced severe exacerbations and hospitalizations among non-cystic fibrosis bronchiectasis patients. The study is the first to report "stabilization of key lung function parameters" as a result of HFCWO use, suggesting early bronchiectasis treatment with HFCWO may significantly slow the otherwise normal progression of the disease. "We are thrilled not only by the results of this study, but the significant milestone it represents," commented Kathleen Skarvan, President and Chief Executive Officer of Electromed. "This is the first independent study to evaluate bronchiectasis-related exacerbations using HFCWO therapy. The results confirm what we've said all along: incorporating the SmartVest into bronchiectasis treatment significantly reduces exacerbations and improves patient outcomes."
Electromed announced that the Internal Revenue Services, or IRS, has agreed to refund the company approximately $406,000 related to federal medical device excise taxes paid on revenue associated with the sales of its SmartVest Airway Clearance System during the company's tax periods ended June 30, 2014 through December 31, 2015. This refund from the IRS will be recognized in the company's financial statements during the fiscal quarter ending June 30, and is the result of an examination the company concluded with the IRS on May 22 that determined the SmartVest was eligible for the retail exemption from the medical device excise tax. Furthermore, the company will be exempt from the medical device tax after the conclusion of the current two-year medical device tax moratorium, which is scheduled to end on December 31, 2019.
The company said, "This month we will commence shipping of SmartVest Connect to targeted, strategic adult pulmonology clinics throughout the United States based on positive feedback from patients and clinicians in the pediatric and cystic fibrosis markets. We expect the number of adult clinics involved to grow steadily as clinicians recognize the value of using wireless monitoring together with SmartVest to improve therapy adherence and quality of life for patients with compromised pulmonary function. All in all, our organic growth strategy is tracking on plan and we expect a higher level of investment in the business to deliver enhanced revenue growth beginning in the second half of fiscal 2018."
Reports Q1 revenue $6.4M vs. $5.5M last year. The company said, "We achieved strong top-line growth in the first quarter of fiscal 2018, driven by a 16.5% year-over-year increase in home care revenue, and remained profitable despite a higher level of investment in the business. This quarter we executed on our growth strategies and continued to increase investment in our sales and reimbursement teams with a focus on adult pulmonology, calling attention to evidence-based studies that differentiate SmartVest(R) and gaining traction in the deployment of SmartVest Connect(TM), our innovative wireless connectivity and patient monitoring solution. We also have strengthened our senior leadership team. Last month, we were excited to announce the appointment of Kathryn Thompson, an accomplished healthcare industry veteran, as Vice President of Reimbursement. Kathryn will lead Electromed's preeminent reimbursement and customer care team, supporting referring clinics and patients who use the SmartVest Airway Clearance System."