10-K: Lifeward Ltd. Reports Full Year 2024 Results, Navigates Financial Challenges
Annual Results
Lifeward Ltd. releases its 10-K filing, highlighting revenue growth driven by the AlterG acquisition and Medicare coverage, while also acknowledging substantial doubt about its ability to continue as a going concern.
Summary
- Lifeward Ltd. reported its 10-K filing for the year ended December 31, 2024.
- The company acknowledges substantial doubt about its ability to continue as a going concern due to recurring losses and negative cash flows.
- Revenue increased by 85% to $25.7 million, driven by the AlterG acquisition and increased ReWalk Personal Exoskeleton sales in the U.S. due to Medicare coverage.
- Gross profit remained consistent at 32% of revenue, totaling $8.2 million.
- The company streamlined U.S. operations, closing two facilities and reducing headcount by 35%, expecting $3 million in operating expense savings.
- An impairment charge of $9.8 million was recorded, primarily related to certain acquired intangible assets.
- The company completed a registered direct offering in January 2025, raising $5.0 million.
- The company is focusing on expanding commercial and reimbursement coverage and penetrating facilities with AlterG systems.
- The company is working on product design improvements and expanded labeling for the ReWalk Personal Exoskeleton product.
- The company is conducting research for its next generation exoskeleton with design improvements and advanced robotic technologies.
- The company is evaluating other applications for DAP technology to create entirely new rehabilitation systems for facility-based customers.
Sentiment
Score: 4
Explanation: While revenue increased, the going concern warning and impairment charges weigh heavily on the sentiment. The capital raise provides some relief, but the overall financial stability remains a concern.
Positives
- Revenue increased by 85% to $25.7 million in 2024.
- The AlterG acquisition contributed $7.9 million to the revenue increase.
- ReWalk Personal Exoskeleton sales in the U.S. increased due to Medicare coverage.
- The company expects $3 million in operating expense savings from streamlining efforts.
- The company completed a registered direct offering in January 2025, raising $5.0 million.
- The company finalized an agreement with BARMER to formalize the reimbursement process for ReWalk exoskeletons to medically eligible beneficiaries.
- The company submitted a 510(k) premarket notification for the ReWalk 7 Personal Exoskeleton.
Negatives
- The company acknowledges substantial doubt about its ability to continue as a going concern.
- The company has an accumulated deficit of $264.8 million as of December 31, 2024.
- The company recorded an impairment charge of $9.8 million, primarily related to certain acquired intangible assets.
Risks
- The company may not have sufficient funds to meet future operating needs or capital requirements.
- The company may not fully realize the anticipated positive impacts to future financial results from streamlining efforts.
- The company faces economic and political risks associated with doing business in Taiwan and Russia.
- The company may fail to meet the requirements for continued listing on the Nasdaq Capital Market.
- The company may fail to secure or maintain adequate insurance coverage or reimbursement for its products by third-party payors.
- Defects in the company's products or the software that drives them could adversely affect the results of operations.
- The potential health benefits of the company's ReWalk products have not been substantiated by long-term clinical data.
- The company depends on third-party suppliers to manufacture its ReWalk and AlterG products.
- The company may receive a significant number of warranty claims or its ReWalk, AlterG, or ReStore systems may require significant amounts of service after sale.
- The company may not be able to enhance its exoskeleton product offerings through its research and development efforts.
- The company may enter into collaborations, in-licensing arrangements, joint ventures, strategic alliances, business acquisitions or partnerships with third parties that may not result in the development of commercially viable products or the generation of significant future revenue.
- The company is not able to protect its intellectual property rights in all countries.
- Conditions in Israel may materially and adversely affect the company's business and results of operations.
- The company's business could be negatively affected as a result of actions of activist shareholders.
Future Outlook
The company expects future growth to be driven by sales of ReWalk Personal devices through expanded reimbursement, increased AlterG system placements, and more MyoCycle placements.
Industry Context
The medical exoskeleton market is competitive and subject to rapid technological change. The company competes with other exoskeleton manufacturers, as well as alternative mobility systems and therapies.
Comparison to Industry Standards
- The report mentions competitors like Ekso Bionics, Rex Bionics, Cyberdyne, FREE Bionics, DIH (Hocoma), Wandercraft, and Bioness (Bioventus).
- The report highlights ReWalk's competitive advantages, such as tilt-sensor technology, six degrees of freedom, faster functional walking speed, and FDA/CE clearance for stairs and curbs.
- The report also mentions the AlterG Anti-Gravity system's versatility and potential for rehabilitation of lower extremity injuries and conditions.
- The report notes that the ReStore Exo-Suit has a design that facilitates a natural, functional walking pattern through flexible materials, sensors, and powered plantarflexion as well as dorsiflexion.
Next Steps
- Continue working with the VHA to accelerate the pace of implementation of the current VHA policy nationally.
- Continue working with both national and regional commercial insurance companies, health care practitioners, physicians, researchers, and the SCI community to support efforts to demonstrate the benefits of our SCI Products.
- Continue ongoing communication to seek greater clarity regarding Medicare coverage and reimbursement standards applicable to the ReWalk Personal Exoskeleton.
- Continue to support clinical research and academic publications, which we believe will further support the case for coverage.
- Continue to focus on expanding commercial and other reimbursement coverage.
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Key Dates
| Date | Description |
|---|---|
| 2001 | Lifeward Ltd. (formerly Argo Medical Technologies Ltd.) was incorporated in Israel. |
| 2012-02 | Larry Jasinski appointed as CEO. |
| 2014-09 | Ordinary shares listed on The Nasdaq Global Market. |
| 2015-12-31 | Kreos Capital V (Expert) Fund Limited (Kreos) loan agreement signed. |
| 2016-05-16 | Research Collaboration Agreement and the Exclusive License Agreement with Harvard University entered. |
| 2017-05 | Listing transferred to The Nasdaq Capital Market. |
| 2017-09 | German insurer BARMER confirmed it will provide ReWalk systems to all qualifying beneficiaries. |
| 2019-06 | FDA issued a 510(k) clearance for ReStore. |
| 2020-07 | A unique code was issued for ReWalk Personal Exoskeleton. |
| 2023-08-11 | Acquisition of AlterG, Inc. completed. |
| 2024-01-01 | Medicare personal exoskeleton claims with dates of service on or after January 1, 2024 that are billed using HCPCS code K1007 are assigned to the brace benefit category. |
| 2024-03-15 | One-for-seven reverse share split of the ordinary shares effected. |
| 2024-04-11 | CMS revised its April 2024 DMEPOS Fee Schedule to include a final lump-sum Medicare purchase fee schedule amount for personal exoskeletons (HCPCS code K1007) with an established rate of $91,032. |
| 2024-09-10 | ReWalk Robotics Ltd. officially changed its name to Lifeward Ltd. |
| 2025-01-07 | Registered direct offering priced $2.75 per share for gross proceeds of $5.0 million. |
| 2025-02 | Agreement with BARMER to formalize the reimbursement process for the provision of ReWalk exoskeletons to medically eligible beneficiaries finalized. |
| 2025-03 | Agreement for CorLife to become the exclusive distributor for the ReWalk Personal Exoskeleton for individuals with workers' compensation claims announced. |
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