Business Overview and History
Pulse Biosciences is a pioneering medical technology company that has developed a novel and proprietary energy modality known as Nanosecond Pulsed Field Ablation (nano-PFA or nsPFA). This revolutionary technology delivers ultra-short electrical pulses, each lasting less than a millionth of a second, to non-thermally clear or destroy targeted cells while sparing surrounding healthy tissue. Pulse Biosciences is leveraging this unique capability to develop medical devices and procedures that have the potential to significantly improve outcomes for patients across a variety of clinical applications.
Pulse Biosciences was incorporated in Nevada on May 19, 2014, and later reincorporated in Delaware in June 2018, maintaining its offices in Hayward, California. The company went public in 2016, listing its common stock on the Nasdaq Capital Market. Initially, Pulse Biosciences focused on developing the CellFX System for treating benign skin lesions, which received FDA 510(k) clearance and CE marking approval in the EU in 2021. The company began commercializing the CellFX System for dermatology procedures in the United States and select international markets shortly after these regulatory clearances.
In September 2022, Pulse Biosciences made a strategic shift in focus from dermatology to cardiology and the treatment of atrial fibrillation (AF). As a result, the company ceased all commercial sales and marketing operations in dermatology and redirected its efforts towards developing novel nano-PFA-based products for cardiac applications, including a surgical ablation clamp and an endocardial catheter ablation device.
To fund its research and development programs, Pulse Biosciences has engaged in various financing activities. In 2022, the company entered into a $65 million loan agreement with its majority shareholder and co-chairman, Robert Duggan. In 2023, Pulse Biosciences received FDA Breakthrough Device Designation for its nano-PFA Cardiac Surgical System for the treatment of AF, as well as enrollment in the FDA's Total Product Life Cycle (TPLC) Advisory Program. This designation and program are designed to provide the company with increased engagement and prioritized review from the FDA as it works to develop and bring this innovative technology to market.
The company has also made significant progress in developing its nano-PFA Percutaneous Electrode System for soft tissue ablation, which received 510(k) clearance from the FDA in 2024 for use in the ablation of soft tissue in percutaneous and intraoperative surgical procedures. Pulse Biosciences has placed this system with seven sites in the U.S. as part of a pilot program, and expects to commence a pivotal clinical trial in mid-2025 to support a specific labeling indication for the treatment of benign thyroid nodules.
In addition to these two key product initiatives, Pulse Biosciences is also developing a nano-PFA 360 Cardiac Catheter for the endocardial treatment of atrial fibrillation. This device has shown promising results in early feasibility studies, and the company plans to initiate a U.S. IDE pivotal clinical study in the middle of 2025.
Financial Overview
Pulse Biosciences is currently in the development and clinical trial stages of its product pipeline, and as a result, has not yet generated significant revenue from product sales. For the year ended December 31, 2023, the company reported total revenue of $0.00 and a net loss of $42.21 million. The company's cash and cash equivalents stood at $44.37 million as of December 31, 2023.
In the third quarter of 2024, Pulse Biosciences reported total GAAP costs and expenses of $13.7 million, up from $11.3 million in the prior year period. Non-GAAP costs and expenses were $10.4 million, compared to $9.2 million in the third quarter of 2023. The company's GAAP net loss for the quarter was $12.7 million, compared to $10.6 million in the same period last year. As of September 30, 2024, the company had $79 million in cash and cash equivalents, having raised $60 million in gross proceeds from a rights offering completed in July 2024, with the potential to raise an additional $66 million through the exercise of associated warrants.
For the most recent fiscal year (2023), Pulse Biosciences reported: - Revenue: Not applicable - Net Income: -$42,210,000 - Operating Cash Flow: -$33,041,000 - Free Cash Flow: -$33,162,000
For the most recent quarter (Q3 2024), the company reported: - Revenue: $0 - Net Income: -$12,680,000 - Operating Cash Flow: -$9,024,000 - Free Cash Flow: -$9,062,000
The company's performance metrics show no year-over-year growth due to its strategic shift from dermatology to cardiology and atrial fibrillation treatment. This change in focus has resulted in decreased revenue and increased costs associated with the advancement of the company's new product pipeline.
Pulse Biosciences currently only sells its products in the United States. The medical device industry, particularly in the areas of cardiology and soft tissue ablation, has seen a compound annual growth rate (CAGR) of approximately 5-7% over the past 5 years as new technologies and treatments continue to emerge.
Liquidity
The company's liquidity position has been bolstered by recent financing activities. As mentioned, Pulse Biosciences raised $60 million in gross proceeds from a rights offering in July 2024, significantly improving its cash position. The potential for an additional $66 million through the exercise of associated warrants provides further financial flexibility. This improved liquidity allows the company to continue funding its research and development efforts, clinical trials, and regulatory processes for its innovative nano-PFA technology.
As of the most recent reporting period, Pulse Biosciences had the following liquidity metrics: - Debt/Equity ratio: 0.015 - Cash: $79,030,000 - Available credit line: The company does not currently have any available credit lines - Current ratio: 11.93 - Quick ratio: 11.93
These figures indicate a strong liquidity position, with a low debt-to-equity ratio and substantial cash on hand to fund ongoing operations and development activities.
Regulatory Milestones and Product Pipeline
The company's nano-PFA Cardiac Surgical System for the treatment of atrial fibrillation received FDA Breakthrough Device Designation in 2023, as well as enrollment in the FDA's TPLC Advisory Program. This designation and program are expected to provide Pulse Biosciences with increased engagement and prioritized review from the FDA as it works to develop and bring this innovative technology to market.
The nano-PFA Percutaneous Electrode System for soft tissue ablation received 510(k) clearance from the FDA in 2024 for use in the ablation of soft tissue in percutaneous and intraoperative surgical procedures. Pulse Biosciences has placed this system with seven sites in the U.S. as part of a pilot program, and expects to commence a pivotal clinical trial in mid-2025 to support a specific labeling indication for the treatment of benign thyroid nodules.
The company's nano-PFA 360 Cardiac Catheter for the endocardial treatment of atrial fibrillation is currently in a first-in-human feasibility study in Europe, with promising early results. Pulse Biosciences plans to initiate a U.S. IDE pivotal clinical study for this device in the middle of 2025.
Product Segments and Development
Pulse Biosciences has two main product segments: the CellFX System and products under development for the treatment of atrial fibrillation (AF).
The CellFX System is the company's first product for soft tissue ablation in a surgical setting. It consists of a console, connectors, and end-effectors, utilizing the proprietary Nano-Pulse Stimulation (NPS) technology. While initially commercialized for dermatology applications, the company has shifted its focus to cardiology and AF treatment.
In the cardiac products segment, Pulse Biosciences is developing two key products:
1. CellFX nsPFA Cardiac Clamp: A surgical ablation clamp designed for use by cardiac surgeons during the surgical treatment of AF.
2. CellFX nsPFA 360° Cardiac Catheter: A catheter-based device designed to provide a circumferential ablation in a single treatment cycle for the minimally invasive treatment of AF.
The company has conducted preclinical studies and initiated early clinical studies for both cardiac products and plans to pursue the premarket approval (PMA) process with the FDA for both devices.
Clinical Development and Future Plans
Pulse Biosciences is currently focused on developing the path to commercialization for three main applications of their Nano-PFA technology:
1. Soft Tissue Ablation: - The CellFX Percutaneous Electrode System has been placed with 7 sites in the U.S. as part of a pilot program. - The company plans to expand this pilot program into 2025 and support select sites to conduct their own clinical research protocols. - A pivotal clinical study for FDA and other regulatory submissions for the treatment of benign thyroid nodules is planned to commence in mid-2025.
2. Cardiac Surgical Ablation for AF: - A first-in-human feasibility study is underway in the Netherlands, with 9 patients treated across 2 sites. - Preliminary results are expected to be shared at a medical congress late in 2025. - The company plans to submit a formal IDE to the FDA to commence a pivotal clinical trial in mid-2025.
3. Endocardial Catheter Ablation for AF: - A first-in-human feasibility study for the 360 cardiac catheter is ongoing in Prague, with over 50 patients treated. - A U.S. IDE pivotal clinical study is expected to begin in the middle of 2025. - Successful pivotal clinical study results will support an FDA PMA submission for the 360 catheter.
Competitive Landscape and Risks
Pulse Biosciences operates in highly competitive markets, facing competition from large, well-established medical device companies with significant resources. The company's success will depend on its ability to demonstrate the safety and efficacy of its nano-PFA technology, as well as its ability to navigate the complex regulatory environment and secure reimbursement for its products.
Other key risks include the company's limited operating history, the significant investments required to complete clinical trials and obtain regulatory approvals, the potential for unexpected delays or setbacks in product development, and the company's reliance on third-party manufacturers and suppliers.
Management and Legal Proceedings
In November 2022, the employment of the company's former Chief Financial Officer, Sandra Gardiner, terminated. Ms. Gardiner filed an arbitration demand in March 2023 seeking severance benefits, which the company believes are without merit and is vigorously defending against. Apart from this ongoing arbitration proceeding, there are no other known scandals, short seller reports, or CEO departures affecting the company.
Conclusion
Pulse Biosciences is a pioneering medical technology company that has developed a novel and proprietary energy modality known as Nanosecond Pulsed Field Ablation (nano-PFA or nsPFA). This revolutionary technology has the potential to significantly improve outcomes for patients across a variety of clinical applications, particularly in the treatment of atrial fibrillation and soft tissue ablation.
The company has made significant progress in advancing its nano-PFA product pipeline, including receiving FDA Breakthrough Device Designation and TPLC Advisory Program enrollment for its cardiac surgical system, as well as 510(k) clearance for its percutaneous electrode system for soft tissue ablation. With a strong cash position and a focus on executing its clinical development and regulatory strategies, Pulse Biosciences is well-positioned to continue its transformation into a leading innovator in the medical device industry.