Sanara MedTech Inc. Announces Second Quarter 2023 Results


FORT WORTH, TX, Aug. 14, 2023 (GLOBE NEWSWIRE) — Sanara MedTech Inc. Based in Fort Worth, Texas, Sanara MedTech Inc. (“Sanara,” the “Company,” “we,” “our” or “us”) (NASDAQ: SMTI), a medical technology company focused on developing and commercializing transformative technologies to improve clinical outcomes and reduce healthcare expenditures in the surgical, chronic wound and skincare markets, announced today its strategic, operational and financial results for the quarter ended June 30, 2023.

Zack Fleming, Sanara’s CEO stated, “The second quarter of 2023 was another record revenue quarter for the Company. Subsequent to the end of the quarter, we completed the acquisition of certain assets related to our collagen products business that we believe will significantly add to our businesses’ performance by decreasing costs and eliminating the royalties we paid on CellerateRX Surgical and HYCOL to the sellers. Additionally, we believe the acquisition will allow us to further develop and commercialize new efficacious products.”

Second Quarter 2023 Strategic and Operational Highlights (Unaudited)


  • During the trailing twelve-month period, the Company’s products were sold in over 950 facilities across 33 states.
  • The Company’s products were contracted or approved to be sold in more than 3,000 hospitals/ASCs as of June 30, 2023. The large increase quarter over quarter was attributable to the Company signing an agreement with a major group purchasing organization.
  • Subsequent to the end of the quarter, the Company completed the acquisition of certain assets related to its collagen products business. The assets acquired included, among others:

– All rights and ownership (for human wound care uses) for four 510(k) cleared collagen-based wound care products, including CellerateRX® Surgical Powder and Gel (“CellerateRX Surgical”) and HYCOL® Hydrolyzed Collagen (“HYCOL”).

– All rights and ownership (for human wound care uses) for three new collagen-based products currently under development.

– All patents, patents pending, trademarks and regulatory approvals related to collagen human wound care products owned by the sellers. This includes nine patents and all of the sellers’ patents pending for collagen products for human wound care uses and five trademarks.

Sales Analysis

The Company generated net revenues of $15.8 million for the three months ended June 30, 2023, compared to net revenues of $9.7 million for the three months ended June 30, 2022, a 63% increase from the prior year period. The higher net revenues for the three months ended June 30, 2023 were primarily due to increased sales of soft tissue repair products (CellerateRX Surgical, FORTIFY TRG® Tissue Repair Graft, FORTIFY FLOWABLE® ECM, and TEXAGEN® Amniotic Membrane Allograft) and, to a lesser extent, bone fusion products (BiFORM® Bioactive Moldable Matrix, AMPLIFYVerified Inductive Bone Matrix, and ALLOCYTE® Advanced Cellular Bone Matrix), as a result of the Company’s increased market penetration and geographic expansion, additional revenues as a result of the Company’s acquisition of Scendia Biologics, LLC in 2022 and the Company’s continuing strategy to expand its independent distribution network in both new and existing U.S. markets. The Company’s sales continue to be negatively impacted by supply issues related to its ALLOCYTE® Advanced Cellular Bone Matrix product. The Company is starting to see improvement and expects an alternative source to come online in the near future.

Earnings Analysis

The Company had a loss before income taxes of $1.9 million for the three months ended June 30, 2023, compared to a loss before income taxes of $3.4 million for the three months ended June 30, 2022. The lower loss before income taxes for the three months ended June 30, 2023 was due to operating expenses increasing at a slower rate than net sales in addition to the benefit recorded as a result of the change in fair value of earnout liabilities. For the three months ended June 30, 2023, the Company had a net loss of $1.9 million, compared to net income of $0.8 million for the three months ended June 30, 2022. The higher net income in 2022 was primarily due to a one-time noncash income tax benefit realized in Q2 of 2022. Subsequent to the end of the quarter, the Company completed the acquisition of certain assets related to its collagen products business. The Company believes that cost savings and the elimination of royalties paid to the sellers will meaningfully contribute to the Company’s earnings going forward. In 2022, the Company paid $1.8 million in royalties on its collagen products.

Conference Call

Sanara will host a conference call on Tuesday, August 15, 2023, at 9:00 a.m. Eastern Time. The toll-free number to call for this teleconference is 888-506-0062 (international callers: 973-528-0011) and the access code is 233776. A telephonic replay of the conference call will be available through Tuesday, August 29, 2023, by dialing 877-481-4010 (international callers: 919-882-2331) and entering the replay passcode: 48852.

A live webcast of Sanara’s conference call will be available under the Investor Relations section of the Company’s website, A one-year online replay will be available after the conclusion of the live broadcast.

About Sanara MedTech Inc.

With a focus on improving patient outcomes through evidence-based healing solutions, Sanara MedTech Inc. markets, distributes and develops surgical, wound and skincare products for use by physicians and clinicians in hospitals, clinics and all post-acute care settings and offers wound care and dermatology virtual consultation services via telemedicine. Sanara’s products are primarily sold in the North American advanced wound care and surgical tissue repair markets. Sanara markets and distributes CellerateRX® Surgical Activated Collagen®, FORTIFY TRG® Tissue Repair Graft and FORTIFY FLOWABLE® Extracellular Matrix as well as a portfolio of advanced biologic products focusing on AMPLIFY Verified Inductive Bone Matrix, ALLOCYTE® Advanced Cellular Bone Matrix, BiFORM® Bioactive Moldable Matrix and TEXAGEN® Amniotic Membrane Allograft to the surgical market. In addition, the following products are sold in the wound care market: BIAKŌS® Antimicrobial Skin and Wound Cleanser, BIAKŌS Antimicrobial Wound Gel, BIAKŌS® Antimicrobial Skin and Wound Irrigation Solution and HYCOL® Hydrolyzed Collagen. Sanara’s pipeline also contains potentially transformative product candidates for mitigation of opportunistic pathogens and biofilm, wound re-epithelialization and closure, necrotic tissue debridement and cell compatible substrates. The Company believes it has the ability to drive its pipeline from concept to preclinical and clinical development while meeting quality and regulatory requirements. Sanara is constantly seeking long-term strategic partnerships with a focus on products that improve outcomes at a lower overall cost. In addition, Sanara is actively seeking to expand within its six focus areas of wound and skin care for the acute, post-acute, and surgical markets. The focus areas are debridement, biofilm removal, hydrolyzed collagen, advanced biologics, negative pressure wound therapy products and the oxygen delivery system segment of the wound and skincare markets.

Information about Forward-Looking Statements

The statements in this press release that do not constitute historical facts are “forward-looking statements,” within the meaning of and subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. These statements may be identified by terms such as “aims,” “anticipates,” “believes,” “contemplates,” “continue,” “could,” “estimates,” “expect,” “forecast,” “guidance,” “intend,” “may,” “plan,” “possible,” “potential,” “predicts,” “preliminary,” “projects,” “seeks,” “should,” “targets,” “will” or “would,” or the negatives of these terms, variations of these terms or other similar expressions. These forward-looking statements include, among others, statements regarding the potential benefits created by the acquisition of certain assets related to the Company’s collagen products business, the anticipated impact of such acquisition on the Company’s business and future financial and operating results, the Company’s ability to develop and commercialize the new collagen-based products currently under development, including the manufacturing, distribution, marketing and sale of such products, the Company’s ability to maintain or replace the manufacturing and distribution process of the sellers in the acquisition, including relationships with vendors, the development of new products, the timing of commercialization of our products, the regulatory approval process and expansion of the Company’s business in telehealth and wound care. These items involve risks, contingencies and uncertainties such as the extent of product demand, market and customer acceptance, the effect of economic conditions, competition, pricing, uncertainties associated with the development and process for obtaining regulatory approval for new products, the ability to consummate and integrate acquisitions, and other risks, contingencies and uncertainties detailed in the Company’s SEC filings, which could cause the Company’s actual operating results, performance or business plans or prospects to differ materially from those expressed in, or implied by these statements.

All forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to revise any of these statements to reflect the future circumstances or the occurrence of unanticipated events, except as required by applicable securities laws.

Investor Contact:

Callon Nichols, Director of Investor Relations
[email protected]

SOURCE: Sanara MedTech Inc.


    June 30,   December 31,
Assets   2023     2022  
Current assets            
Cash   $ 6,060,228     $ 8,958,995  
Accounts receivable, net     7,141,105       6,805,761  
Accounts receivable – related party     20,662       98,548  
Royalty receivable     49,344       99,594  
Inventory, net     4,420,864       3,549,000  
Prepaid and other assets     485,734       1,104,611  
Total current assets     18,177,937       20,616,509  
Long-term assets            
Property and equipment, net     1,240,269       1,416,436  
Right of use assets – operating leases     2,030,938       806,402  
Goodwill     3,601,781       3,601,781  
Intangible assets, net     30,143,578       31,509,980  
Investment in equity securities     3,084,278       3,084,278  
Total long-term assets     40,100,844       40,418,877  
Total assets   $ 58,278,781     $ 61,035,386  
Liabilities and shareholders’ equity            
Current liabilities            
Accounts payable   $ 1,016,180     $ 1,392,701  
Accounts payable – related parties     96,656       34,036  
Accrued royalties and expenses     1,895,706       2,144,475  
Accrued bonuses and commissions     5,899,255       7,758,284  
Earnout liabilities – current     700,000       1,162,880  
Operating lease liabilities – current     273,539       313,933  
Total current liabilities     9,881,336       12,806,309  
Long-term liabilities            
Earnout liabilities – long-term     5,653,534       6,003,811  
Operating lease liabilities – long-term     1,779,413       505,291  
Total long-term liabilities     7,432,947       6,509,102  
Total liabilities     17,314,283       19,315,411  
Commitments and contingencies            
Shareholders’ equity            
Common Stock: $0.001 par value, 20,000,000 shares authorized;
8,439,745 issued and outstanding as of June 30, 2023 and
8,299,957 issued and outstanding as of December 31, 2022
    8,440       8,300  
Additional paid-in capital     67,881,419       65,213,987  
Accumulated deficit     (26,740,930 )     (23,394,757 )
Total Sanara MedTech shareholders’ equity     41,148,929       41,827,530  
Equity attributable to noncontrolling interest     (184,431 )     (107,555 )
Total shareholders’ equity     40,964,498       41,719,975  
Total liabilities and shareholders’ equity   $ 58,278,781     $ 61,035,386  


    Three Months Ended   Six Months Ended
    June 30,   June 30,
    2023     2022     2023     2022  
Net Revenue   $ 15,753,164     $ 9,670,778     $ 31,275,081     $ 17,482,001  
Cost of goods sold     2,187,516       958,086       4,313,175       1,763,167  
Gross profit     13,565,648       8,712,692       26,961,906       15,718,834  
Operating expenses                        
Selling, general and
administrative expenses
    13,811,476       10,428,133       26,780,545       19,803,763  
Research and development     1,177,128       1,067,000       2,494,452       1,271,637  
Depreciation and
    803,694       539,124       1,582,569       741,871  
Change in fair value of
earnout liabilities
    (360,470 )     63,427       (813,157 )     63,427  
Total operating expenses     15,431,828       12,097,684       30,044,409       21,880,698  
Operating loss     (1,866,180 )     (3,384,992 )     (3,082,503 )     (6,161,864 )
Other expense                        
Interest expense and other                 (6 )      
Share of losses from equity
method investment
                      (379,633 )
Total other expense                 (6 )     (379,633 )
Loss before income taxes     (1,866,180 )     (3,384,992 )     (3,082,509 )     (6,541,497 )
Income tax benefit           4,141,906             4,141,906  
Net income (loss)     (1,866,180 )     756,914       (3,082,509 )     (2,399,591 )
Less: Net loss attributable
to noncontrolling interest
    (38,447 )     (12,512 )     (76,876 )     (39,693 )
Net income (loss) attributable to Sanara MedTech shareholders   $ (1,827,733 )   $ 769,426     $ (3,005,633 )   $ (2,359,898 )
Net income (loss) per share:                        
Basic   $ (0.22 )   $ 0.10     $ (0.37 )   $ (0.31 )
Diluted   $ (0.22 )   $ 0.09     $ (0.37 )   $ (0.31 )
Weighted average common shares outstanding:                        
Basic     8,226,271       7,791,431       8,200,173       7,699,422  
Diluted     8,226,271       8,162,983       8,200,173       7,699,422  


  Six Months Ended
  June 30,
  2023     2022  
Cash flows from operating activities:      
Net loss $ (3,082,509 )   $ (2,399,591 )
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation and amortization   1,582,569       741,871  
Loss on disposal of property and equipment         2,500  
Bad debt expense   86,000       195,000  
Inventory obsolescence   69,990       159,717  
Share-based compensation   1,724,637       1,288,335  
Noncash lease expense   144,628       116,143  
Loss on equity method investment         379,633  
Benefit from deferred income taxes         (4,141,906 )
Change in fair value of earnout liabilities   (813,157 )     63,427  
Changes in operating assets and liabilities:          
Accounts receivable, net   (371,094 )     (1,170,829 )
Accounts receivable – related party   77,886       (130,797 )
Inventory, net   (941,854 )     (423,764 )
Prepaid and other assets   618,877       177,861  
Accounts payable   (376,521 )     294,772  
Accounts payable – related parties   62,620       589,675  
Accrued royalties and expenses   (248,769 )     761,377  
Accrued bonuses and commissions   (1,859,029 )     346,887  
Operating lease liabilities   (135,436 )     (117,106 )
Net cash used in operating activities   (3,461,162 )     (3,266,795 )
Cash flows from investing activities:          
Purchases of property and equipment   (40,650 )     (80,892 )
Proceeds from disposal of assets   650       345  
Purchases of intangible assets         (2,053,722 )
Investment in equity securities         (250,000 )
Net cash used in investing activities   (40,000 )     (2,384,269 )
Cash flows from financing activities:          
Equity offering net proceeds   1,033,761        
Net settlement of equity-based awards   (431,366 )     (102,931 )
Distribution to noncontrolling interest member         (220,000 )
Net cash provided by (used in) financing activities   602,395       (322,931 )
Net decrease in cash   (2,898,767 )     (5,973,995 )
Cash, beginning of period   8,958,995       18,652,841  
Cash, end of period $ 6,060,228     $ 12,678,846  
Cash paid during the period for:          
Interest $ 6     $  
Supplemental noncash investing and financing activities:          
Right of use assets obtained in exchange for lease obligations   1,369,164        
Equity issued for acquisitions         9,709,089  
Earnout liabilities generated by acquisitions         3,882,151  
Investment in equity securities converted in asset acquisition         1,803,440  

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