Exhibit 99.1
Contact:
EnteroMedics Inc.
Greg S. Lea
(651) 789-2860
ir@enteromedics.com
EnteroMedics Reports Third
Quarter 2010 Financial Results
Signs Cooperation Agreement with
Australian Institute of Weight Control (AIWC)
ST. PAUL, Minnesota,
October 21, 2010 – EnteroMedics Inc., (NASDAQ: ETRM), the
developer of medical devices using neuroblocking technology to
treat obesity and other gastrointestinal disorders, today announced
financial results for the three and nine months ended
September 30, 2010.
For the three months ended
September 30, 2010, the Company reported a net loss of $4.4
million, or $0.59 per share, including research and development
expenses of $2.3 million and general and administrative expenses of
$1.8 million. For the nine months ended September 30, 2010,
the Company reported a net loss of $13.4 million, or $1.81 per
share. Operating expenses were primarily associated with the cost
of supporting the Company’s multiple, ongoing clinical trials
and the continued development of VBLOC® vagal blocking therapy
delivered through the Company’s Maestro® System. On
September 30, 2010, the Company’s cash, cash equivalents
and short-term investments together with the remaining proceeds
from the Series A Non-Voting Convertible Preferred Stock offering
received shortly after September 30, 2010 totaled $13.3
million.
The Company also announced today
that it has entered into a cooperation agreement with the
Australian Institute of Weight Control (AIWC), a network of
bariatric clinics specializing in laparoscopic weight loss surgery
and clinical research for the morbidly obese. AIWC will be the
first clinics in Australia to implant the Maestro System when it
has received approval by the Australian Therapeutic Goods
Administration (TGA). In addition to clinical use of the Maestro
System, the agreement includes objectives related to support of the
commercialization of VBLOC Therapy and the Maestro Rechargeable
(RC) System in Australia and worldwide through cooperation in
training, accreditation and research.
“The third quarter was an
important period for EnteroMedics, as we achieved key financial,
regulatory and commercialization objectives in our effort to
deliver a safe and effective surgical treatment option for
obesity,” said President and Chief Executive Officer Mark B.
Knudson, Ph.D. “Clinical data continues to validate our
approach, demonstrating VBLOC Therapy’s ability to achieve
clinically meaningful weight loss and significant improvements in
hypertension and diabetes with no therapy
related serious adverse events. Our agreement
with the AIWC, Australia’s largest network of bariatric
surgical clinics, marks an important step toward the successful
commercialization of the Maestro System in a major international
market. We remain focused on our commercialization strategy within
this market while developing a clinical pathway toward regulatory
approval in the U.S.”
Greg S. Lea, Senior Vice President
and Chief Financial Officer, added “EnteroMedics recently
completed a $6.3 million Series A Non-Voting Convertible Preferred
Stock offering, bringing our available cash to $13.3 million. This
capital provides us with the continued ability to support multiple
ongoing clinical studies and explore commercialization of the
Maestro System in key international markets.”
AIWC Cooperation
Agreement
Under the cooperation agreement,
EnteroMedics has designated AIWC and AIWC Member Clinics as
authorized training and implantation centers for EnteroMedics
products. The AIWC will work with EnteroMedics to provide research,
communications, training and accreditation support related to the
Maestro RC System in Australia and other international territories.
Further, the two organizations will work toward Australian
Therapeutic Goods Administration (TGA) approval of the Maestro RC
System and collaborate on subsequent marketing and distribution
efforts within this territory. The AIWC will also support
EnteroMedics’ efforts in gaining reimbursement for the
private sector through the Medical Services Advisory Committee
(MSAC) in Australia.
On August 2, 2010, EnteroMedics
announced its plans to commercialize the Maestro RC System in
Australia and its plans to file an application for approval and
listing with the Australian Therapeutic Goods Administration upon
receipt of CE Mark certification for the Maestro RC System.
EnteroMedics hopes to receive TGA approval during the second half
of 2011. The Company continues to explore commercialization
opportunities in other markets outside of the United
States.
About the AIWC
The AIWC is a network of multi
disciplinary weight loss surgical clinics specializing in
laparoscopic weight loss surgery for the morbidly obese. It
consists of three partner clinics in Adelaide, Perth and Sydney,
with expansion plans for other centers in Australia. The AIWC works
with public and private organizations to develop treatment
platforms for the morbidly obese, striving for continual clinical
improvement through leadership research and training programs. The
AIWC performed more than 1,250 bariatric procedures in 2009 and has
a base of over 7,000 patients. The bariatric surgeons of the AIWC
were among the first in the world to implant the Maestro System and
have participated in all of EnteroMedics’ clinical studies to
date.
About Obesity in
Australia
According to the Australian Bureau
of Statistics, in 2008 sixty-two percent of all adults in Australia
were either overweight (BMI > 25) or obese (BMI > 30). It is
estimated that by 2025, 7.2 million Australians could be
obese. The Australian Federal Minister has declared obesity a
national priority, with obesity related costs exceeding $21 billion
annually. Approximately 13,900 bariatric surgeries were performed
in Australia in 2008.
About EnteroMedics Inc.
EnteroMedics is a development stage
medical device company focused on the design and development of
devices that use neuroblocking technology to treat obesity and
other gastrointestinal disorders. EnteroMedics’ proprietary
neuroblocking te
