TO FINANCIAL STATEMENTS
to Financial Statements
this report, “Stereotaxis”, the “Company”, “Registrant”, “we”, “us”,
and “our” refer to Stereotaxis, Inc. and its wholly owned subsidiaries. Epoch®, Niobe®,
Odyssey®, Odyssey Cinema™, Vdrive®, Vdrive Duo™, V-CAS™,
V-Loop™, V-Sono™, V-CAS Deflect™, QuikCAS™, and Cardiodrive®
are trademarks of Stereotaxis, Inc. All other trademarks that appear in this report are the property of their respective
Description of Business
designs, manufactures and markets the Epoch Solution, which is an advanced remote robotic navigation system for use in
a hospital’s interventional surgical suite, or “interventional lab”, that we believe revolutionizes the treatment
of arrhythmias and coronary artery disease by enabling enhanced safety, efficiency, and efficacy for catheter-based, or interventional,
procedures. The Epoch Solution is comprised of the Niobe ES Remote Magnetic Navigation System (“Niobe
ES system”), Odyssey Information Management Solution (“Odyssey Solution”), and the Vdrive
Robotic Navigation System (“Vdrive system”), and related devices.
Niobe system is designed to enable physicians to complete more complex interventional procedures by providing image-guided
delivery of catheters and guidewires through the blood vessels and chambers of the heart to treatment sites. This is achieved
using externally applied magnetic fields that govern the motion of the working tip of the catheter or guidewire, resulting in
improved navigation, efficient procedures, and reduced x-ray exposure. As of June 30, 2018, the Company had an installed base
of 127 Niobe ES systems.
addition to the Niobe system and its components, Stereotaxis also has developed the Odyssey Solution, which consolidates
all lab information enabling doctors to focus on the patient for optimal procedure efficiency. The system also features a remote
viewing and recording capability called Odyssey Cinema, which is an innovative solution delivering synchronized content
for optimized workflow, advanced care, and improved productivity. This tool includes an archiving capability that allows clinicians
to store and replay entire procedures or segments of procedures. This information can be accessed from locations throughout the
hospital local area network and over the global Odyssey Network providing physicians with a tool for clinical collaboration,
remote consultation, and training.
Vdrive system provides navigation and stability for diagnostic and therapeutic devices designed to improve interventional
procedures. The Vdrive system complements the Niobe ES system control of therapeutic catheters for fully remote
procedures and enables single-operator workflow and is sold as two options, the Vdrive system and the Vdrive Duo
system. In addition to the Vdrive system and the Vdrive Duo system, we also manufacture and market various disposable
components which can be manipulated by these systems.
promote the full Epoch Solution in a typical hospital implementation, subject to regulatory approvals or clearances. The
full Epoch Solution implementation requires a hospital to agree to an upfront capital payment and recurring payments. The
upfront capital payment typically includes equipment and installation charges. The recurring payments typically include disposable
costs for each procedure, equipment service costs beyond warranty period, and software licenses. In hospitals where the full Epoch
Solution has not been implemented, equipment upgrade or expansion can be implemented upon purchasing of the necessary upgrade
core components of Stereotaxis systems, such as the Niobe system, Odyssey Solution, Cardiodrive, and various
disposable interventional devices have received regulatory clearance in the U.S., Europe, Canada, China, Japan and various other
countries. We have received the regulatory clearance, licensing and/or CE Mark approvals that allow us to market the Vdrive
and Vdrive Duo systems with the V-CAS, V-Loop and V-Sono devices in the U.S., Canada and European
Union. The V-CAS Deflect catheter advancement system has been CE Marked for sale in the European Union.
have successfully integrated our Niobe system with digital fluoroscopy systems to provide advanced interventional lab visualization
and instrument control through user-friendly computerized interfaces. The maintenance of these arrangements, or the establishment
of equivalent alternatives, is critical to our commercialization efforts. The commercial availability of both currently compatible
digital imaging fluoroscopy systems is unlikely to continue for multiple years and efforts are being made to ensure the availability
of integrated next generation systems and/or equivalent alternatives; however, we cannot provide assurance as to the timeline
of the ongoing availability of such compatible systems or our ability to obtain equivalent alternatives on competitive terms or
Summary of Significant Accounting Policies
accompanying unaudited financial statements of Stereotaxis, Inc. have been prepared in accordance with generally accepted accounting
principles for interim financial information and the instructions to Form 10-Q. Accordingly, they do not include all the disclosures
required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, they
include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for
the interim periods presented. Operating results for the six month period ended June 30, 2018 are not necessarily indicative of
the results that may be expected for the year ended December 31, 2018 or for future operating periods.
interim financial statements and the related notes should be read in conjunction with the annual financial statements and notes
included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 as filed with the Securities and
Exchange Commission (SEC) on March 20, 2018.