PAXMAN publishes its interim report for Q3 2023

The Group’s total sales amounted to 61.2 (41.3) MSEK for the third quarter of the year, with EBITDA reaching 13.0 (5.6) MSEK. The net result totalled 7.4 (4.7) MSEK in Q3, and earnings per share were
0.39 (0.24) SEK.

Cash flow from operating activities amounted 133 TSEK (-3.1 MSEK) in the third quarter of the year.

A total number of 444 (372) scalp cooling systems were installed around the world January-September 2023, with the orderbook containing an additional 149 (220) number of systems.

Average daily treatment (ADTR) amounted to 43.2 TUSD for Q3 2023, corresponding to an increase of 57.4% compared to 27.4 TUSD for Q3 2022. Recurring income increased from 22.4 MSEK in Q3 2022 to 32.2 MSEK for the same period in 2023.

Significant events during the reporting period

• In August Paxman signed a further agreement with Concord Medical, China. Both parties have decided to cooperate in introducing the scalp cooling system before it officially obtains the medical device registration license issued by NMPA, in order to facilitate market research, customer interest data collection, and product promotion in the early stages - a further step in developing the company’s profile in Asia.
• Also in August Paxman signed an agreement with TACRO in China. TACRO provides medical device manufacturing companies with NMPA registration services and is headquartered in Wuhan, with branches in Beijing, Suzhou, Shenzhen, and Shanghai. Now, the total employee number is 170+. They have more than 30 regulatory consultants assisting companies to access China’s fast growing market.
• Later in August Paxman signed its first Buy & Bill agreement in the state of New York, which adds a further 12 locations to its newest business model. A large initial order for cooling caps was received equating to over 2.5 MSEK.
• Following the incorporation of Paxman Canada Inc. earlier in the year, the company has now officially onboarded its first Canadian employees based in Ontario. The company welcomes its new employees to the global team.

Significant events after the reporting period

• In early October Paxman passed its Medical Device Single Audit Program (MDSAP) surveillance audit with BSI, The British Standards Institution. The Medical Device Single Audit Program allows an MDSAP recognized Auditing Organization to conduct a single regulatory audit of a medical device manufacturer that satisfies the relevant requirements of the regulatory authorities participating in the program.
• At the beginning of October Paxman announced that the Palmetto GBA Medicare Administrative Contractor (MAC) has issued a Local Coverage Determination (LCD) to provide coverage guidance for Scalp Cooling for the Prevention of Chemotherapy-Induced Alopecia. According to the final LCD guidance from Palmetto GBA, “the use of a scalp hypothermia device that has been approved by the United States (U.S.) Food and Drug Administration (FDA) for the prevention of chemotherapy-induced alopecia (CIA) shall be considered reasonable and necessary for patients with solid tumors.” In addition, there were no changes between the Proposed LCD and the Final LCD. This is the first LCD that has been approved for scalp cooling and is a result of a request made to Palmetto GBA in February 2023 by PAXMAN. This important Palmetto LCD provides a pathway for reimbursement of Medicare scalp cooling claims for patients in the seven-state service area, effective November 12, 2023. PAXMAN currently serves 55 locations within the Palmetto GBA jurisdiction.
• On the 10th October our CEO, Richard Paxman, attended his OBE Investiture ceremony. Richard was presented with his OBE insignia award (medal) for services to international trade by Her Royal Highness The Princess Royal in the Grand Reception Room at Windsor Castle
• In early November Paxman announced that the US Centers for Medicare & Medicaid Services (CMS) had published the OPPS Final Rule, which continues to support scalp cooling but decreases the average rate from $1850.50 to $1250.50 under the Hospital Outpatient Prospective Payment System (OPPS) and the Ambulatory Surgery Center (ASC) payment system for Calendar Year (CY) 2024.