Voluntis – Annual results 2018

Paris, France, 21 March 2019
  • Diabetes digital therapeutics, focused on insulin-treated patients, deployed with positive momentum 
  • Product line of digital therapeutics extended beyond diabetes and oncology to include immunology through a collaboration with AbbVie
  • Proprietary digital therapeutics portfolio consolidated
  • Organization and deployment structure expanded
  • Positive market momentum driven by growing interest in digital therapeutics
  • Update to medium-term objectives

Voluntis (Euronext Paris, Ticker: VTX - ISIN: FR0004183960), a company specializing in digital therapeutics, announces its revenues and annual results for the year ended December 31, 2018.

Pierre Leurent, Chief Executive Officer of Voluntis, said:“As announced, in 2018 we worked to strengthen our organization and portfolio of solutions. We thus significantly consolidated our fundamentals, resulting in the continued deployment of our diabetes solutions, the advancement of our multi-cancer platform and the remarkable extension of our solution portfolio to a new therapeutic area, namely immunology with AbbVie. This solid foundation, combined with the growing interest in digital therapeutics, particularly in the United States, increases Voluntis' strategic value and positions us for revenue growth in 2019.”

Highlights of the year

Voluntis continued its focused investment strategy to strengthen its organization, consolidate its assets and succeed in its key markets, diabetes and oncology. 

Strengthening the organization

At the organizational level, Voluntis increased its investments in the United States to support deployment and marketing activities: operating expenses incurred in the United States increased by 42% and represented 20% of Voluntis' total expenses in 2018 (vs. 16% in the previous year). The appointments of Jan Berger and Roberta Herman to its Board of Directors have also helped strengthen Voluntis' expertise in the American market. Voluntis further refined its commercial targeting in the United States and developed a new range of multi-channel services to facilitate the prescription and continued use of its products by healthcare professionals.

Consolidation of strategic assets

The Group consolidated its portfolio of proprietary solution assets: 

  • In diabetes, Voluntis continued to upgrade Insulia to focus on user experience. It added a Spanish-language version for the US market. It also expanded the insulins covered to include NPH, which continues to be a cost-effective form of utilized insulin, particularly in the United States, United Kingdom and Germany. At the regulatory level, this version was recently approved in Europe and is currently under review by the FDA in the United States. 
  • In oncology, Voluntis finalized the development of its multicancer symptom management solution. 

Success in key markets

The Group recorded positive commercial traction:

  • In diabetes, Insulia’s deployment has gained momentum: 

In the United States:

  • Insulia has now been deployed in healthcare centers in 13 states. 
  • Though many digital tools are challenged by ongoing consumer engagement, initial results from real-life Insulia patients confirm positive use and adherence rates. In addition, qualitative insights from patients have shown a high level of satisfaction. 

Outside the United States: 

  • In Canada and Germany, Insulia is currently being evaluated in pilot programs.
  • In France, Insulia is being deployed in conjunction with Diabeo, providing healthcare professionals with digital therapeutics across the entire insulin treatment pathway.  
  • In oncology, Voluntis extended its collaboration with AstraZeneca to a new clinical evaluation phase of the eCO (eCediranib-Olaparib) digital therapeutic, which also received the prestigious Prix Galien MedStartUp for the best patient support technology. The results of the eCO feasibility study were published in the Journal of Clinical Oncology (JCO®) Clinical Cancer Informatics. 
  • Leveraging its Theraxium platform, Voluntis has extended its activity toimmunology, as part of a collaboration with AbbVie to develop companion digital therapeutics for the United States.  

2018 annual results: 2018 operating results of -€15.5M, reflecting the consolidation of strategic assets and the increase in personnel costs

For all of 2018, Voluntis generated revenue of €4.5 million compared to €7.3 million in 2017. As a reminder, 2017 included milestone payments of €3.7 million compared to €0.5 million in 2018.

As explained in the half-year results, the reduction in total revenue is in line with the Group's strategy. It is explained by the transition to a greater share of recurring revenue from product sales and a lesser share from pre-launch revenue linked to product development and approval. Although payer and provider sales did not contribute to revenues in 2018, the Group is actively pursuing payer and provider contracts.

Following up on actions taken at the beginning of the year, the Group continued to strengthen its teams, particularly in the United States, to support the marketing and deployment of Insulia. Operating expenses thus increased to €19.1 million and are linked to the increase in the number of employees, particularly field staff in the United States. 

The Group has applied the new IFRS 15 revenue recognition standard since 1 January 2018, without restatement of prior periods. The transition to this new standard had a minimal impact on total revenue in 2018, yet significant negative impacts on the various revenue categories, which offset each other overall. The implementation of IFRS 15 had an impact of €1.1 million on personnel costs. As a reminder, the new standard deals with accounting of revenues and costs related to contracts with customers. Costs capitalized in previous years are subsequently recognized when control on the solution is transferred to the client.

EBITDA was €13.7 million and operating income was €15.5 million.

At the end of December 2018, Voluntis' available cash position amounted to €19.8 million compared to €1.8 million at 31 December 2017. This is the result of the capital increase carried out at the time of the company's initial public offering and the implementation of a €4 million venture loan. 

Prospects for 2019 are promising despite delays observed in 2018 with medium-term repercussions

The Group is pushing its commercial momentum, particularly in diabetes in the United States, where referrals to payer groups are increasing. After signing an agreement with WellDyneRx, active conversations with leading payers should come to fruition. The Group also expects the first health centers in collaboration with Livongo and Monarch to be launched in 2019. In addition, Medicare has introduced new reimbursement codes to promote the development of remote monitoring and support for the chronically ill. 

Overall, digital therapeutics have received increasing media and economic interest. Media coverage of digital therapeutics has increased significantly, and investments in the digital health sector are strong with a total of $8.1 billion invested in the United States over 2018[1]. Analysts expect digital therapies to become a leading health technology category in 2019, helping to reshape the life sciences industry[2]

In this context, Voluntis will continue to strengthen its strategic proprietary assets for all players in the health ecosystem and further cover the digital therapeutics value chain at the heart of healthcare systems’ concerns around the world, especially payers in the United States. 

However, the moderate pace of incorporation of digital therapeutics into provider workflows observed in 2018 and the discontinued collaboration with Roche Pharma France are leading Voluntis to update its medium-term objectives. Voluntis now expects to achieve a turnover of € 40 million and to reach breakeven in 2021. 

About Voluntis

Voluntis creates digital therapeutics that empower people suffering from chronic conditions to self- manage their treatment every day, thus improving real-world outcomes. Combining mobile and web apps, Voluntis’ solutions deliver personalized recommendations to the patient and the care team so that they can, for example, adjust treatment dosage, manage side effects or monitor symptoms. These real- time recommendations are based on digitized clinical algorithms. Leveraging its Theraxium technology platform, Voluntis has designed and operates multiple digital therapeutics, especially in diabetes and oncology. Voluntis has long-standing partnerships with leading life science companies such as AbbVie, AstraZeneca, Roche, Sanofi and Onduo. Based out of Boston and Paris, France, Voluntis is a founding member of the Digital Therapeutics Alliance. For further information: http://www.voluntis.com

Voluntis is traded on the Euronext Paris – Compartment C market

Appendix

Key financials

  • Income statement 

€m

 

2018

2017

Revenue 

 

4.5

7.3

Other Operating Income

 

0.6

1.1

Total Income

 

5.2

8.4

Labor Costs

 

-12.2

-10.4

Other Expenses & Income 

 

-6.6

-6.0

Operational Depreciations

 

-1.8

-1.5

Operating profit

 

-15.5

-9.6

Financial income 

 

-0.4

-0.4

Taxes

 

0.0

0.0

Net income 

 

-15.9

-10.0

 

 

 

 

EBITDA

 

-13.7

-8.1

  

  • Statement of financial position 

Assets (€m)

2018

2017

   Intangible assets

1.9 

2.5 

   Tangible assets

0.6 

0.8 

   Other fixed assets

0.3 

0.2 

   Other non-current assets

1.0 

Non current assets

3.7 

3.5 

   Receivables

1.5 

0.3 

   Other current assets

5.5 

2.3 

   Cash on hand

19.8 

1.8 

Current assets

26.8 

4.5 

Total assets

30.6 

8.0 

 

 

Liabilities & Equity (€m)

2018

2017

 

 

Shareholder equity

17.3 

(1.1)

Financial debt (non current)

2.2 

0.3 

LT provisions and other non current liabilities

3.4 

0.5 

Non  current liabilities

5.6 

0.7 

Financial debt (current)

1.4 

4.0 

Payables and other current liabilities

6.2 

4.4 

Current liabilities

7.6 

8.4 

Total liabilities and equity

30.6 

8.0 

Ticker: VTX – ISIN: FR0004183960


[1]Source: Rock Health Digital Health Funding Report 2018

[2]Source: https://www.pwc.com/us/en/industries/health-industries/top-health-industry-issues/digital-therapeutics-and-connected-care.html