EnteroMedics sees first product revenues

Last week, we profiled EnteroMedics' ($ETRM) seeming rise from the ashes. Today, the company, which makes neuroblocking devices to treat obesity and other metabolic diseases, released its Q1 2012 results, during which it posted a net loss of $5.6 million, or $0.15 per share, with roughly $123,000 in revenues. In a major win for the company, it was the first time it had recorded product revenues, which were a result of shipments to Australia of its Maestro rechargeable system.

The company has been making strides in several markets around the world, and sees great opportunity in the Middle East, where it has already lined up a distributor for its Maestro system. Potential markets of opportunity are Saudi Arabia, Kuwait, the United Arab Emirates, Qatar and Bahrain.

CEO Mark Knudson said during a call about the earnings that the company is excited to be on a "new trajectory." It's looking to get its Australian Maestro marketing program up and running and is close to finalizing website content in conjunction with its distributor. It is eyeing both broadcast and print media.

The big market the company is still eyeing is the U.S., and it hopes to submit a Maestro app to the FDA next year. In terms of Europe, the company is in discussions with key opinion leaders, but the costs of getting market penetration in each country are prohibitive at this point. While it remains an important area, the company will look at other geographies first. However, it does have CE Mark approval for Maestro.

That the company has finally turned a profit might have seemed almost impossible a couple of years ago. That's when a trial showed its technology didn't meet a key goal of a trial. It will be interesting to see if the company picks up even more steam with the results of the ReCharge study.

- see the EnteroMedics release