Symphonix wird über die Marktzulassung entschieden!!! - 500 Beiträge pro Seite

[steperjo]

Heute ist der Tag der Wahrheit !!!!!!
Heute wird entschieden ob das Hörgerat zugelassen wird!!
www.symphonix.com

[A.TH.]

Bei den Ami`s tut sich was.
Kurs ging mit insgesamt 325.200 Stück hoch auf 5 1/2$. Anscheinend wissen die schon etwas.
Meldungen habe ich allerdings noch keine gefunden.
Gruß A.TH.

[Viva-los-Tioz]

Bin sehr gespannt!!

[MacMax]

Hi !

Also es gab eine Einstimmige Empfehlung der FDA das Gerät zuzulassen
Jetzt gehts aber noch so 4 - 6 Wochen bis die Bürokratie abgeschlossen ist !!

Alles in bester Ordnung

Gruss
MM

PS: inden USA gibt es 28 mio. schwerhörige !!!!!

[steperjo]

@MacMax
Supe Iinfo ist genau die Auskunft ,die man auch von der Firma erhält!!!!
Vielen dank für den super Beitrag.
Symphonix ist also ein strong buy!!!!

[rolla]

Strong by ?
warum fällt der Kurs ? Mittlerweile auf 5,95E
a.r.

[IWEG]

Der Kurs fällt, weil in Deutschland offensichtlich alle bekloppt sind!!!
Schaut euch mal das letzte ASK vom Freitag in Amiland an:
über 10 $ !!!! (nachzulesen bei Comdirect, consors etc.). Es kam zwar kein Handel mehr zu dem Preis zustande, aber die Amis wissen zumindest, was sie da für Schätze haben, und wie hoch der realistische Preis dafür ist.
Wer unter 10 € verkauft, wird sich um 15.30 Uhr mächtig ärgern.

IWEG

[steperjo]

@rolla
wie MacMax schon geschrieben hat dauert es noch eine weile.
In den USA steigen die Umsätze (smpx).

[backgroundinformer]

Hallo IWEG!
Man lernt doch nie aus!
Was bedeutet ASK ausgeschrieben, wo und wie genau können alle SMPX-Fans diesen Kurs bei comdirect nachschauen?
Bedanke mich schon jetzt im Namen aller!
mfg
backgroundinformer

[sacrow]

Adhoc Meldung über Zulassung
Island Book buy 6.50 sell 10.50 $


Symphonix Devices, Inc. Receives FDA Panel`s Approval Recommendation for the Vibrant(R) Soundbridge(TM)
PRNewswire via Comtex

July 24, 2000

SAN JOSE, Calif., Jul 24, 2000 /PRNewswire via COMTEX/ -- The Ear, Nose, and Throat Medical Devices Advisory Panel of the Food and Drug Administration (FDA) unanimously recommended that the Vibrant(R) Soundbridge(TM) be approved for use in the United States, announced Kirk Davis, president and chief executive officer (CEO) of Symphonix Devices, Inc. (Nasdaq:SMPX), the developer of the device. The Vibrant Soundbridge is a semi-implantable hearing device designed to treat moderate to severe sensorineural hearing loss, the most common form of hearing impairment.

`The panel`s recommendation brings us one step closer to making the Vibrant Soundbridge available to millions of hearing-impaired people across the United States,` Mr. Davis stated. `We are pleased that the panel reviewed our extensive clinical data and reached the same conclusion we did -- that the Vibrant Soundbridge is a safe and effective treatment for people who desire an alternative to acoustic hearing aids.`

The U.S. clinical trial of the Vibrant Soundbridge, which was conducted at 10 clinics and universities across the nation, demonstrated that the device performs better than hearing aids in many environments. For example, the investigation documented that patients implanted with the Vibrant Soundbridge perceived a benefit from improved sound clarity, quality and increased functional gain as compared to their hearing aids. The patients reported significant benefit from and preference for the Vibrant Soundbridge in a variety of listening situations such as outdoors, in restaurants, and when listening to television and radio -- significant concerns for people affected by hearing loss. In addition, participants in the clinical trial noted that the Vibrant Soundbridge was more comfortable to wear. Importantly, the vast majority of Vibrant Soundbridge patients experienced no change in their pre-surgery hearing ability.

`As one of the investigational sites in the clinical trial, we had a very positive experience with the Vibrant Soundbridge,` said Thomas Balkany, M.D., professor and chairman of the department of otolaryngology at the University of Miami School of Medicine. `The procedure to implant the device is straightforward and well understood by practicing otologists. The response from our patients has been very encouraging and we look forward to be able to offer the treatment to a greater number of people.`

David Fabry, Ph.D., director of audiology at the Mayo Clinic, participated in the FDA panel review. `The compiled data from all of the clinical trial sites is quite compelling,` Dr. Fabry said. `The national trial results demonstrate that the vast majority of patients are more satisfied with the Vibrant Soundbridge, as compared to their hearing aids, in the key areas where hearing aids traditionally have limitations. Namely, effectiveness in background noise, overall fit and comfort, and the sound of their own voice. The Vibrant Soundbridge is a welcome addition to the options available for the hearing impaired.`

Symphonix is now awaiting final authorization from the FDA to begin commercial operations in the United States. `We are confident that we can meet the conditions as outlined by the panel for approval,` Mr. Davis said. `The company is committed to working with the agency to bring this breakthrough technology to the public as soon as possible.`

About Symphonix

Founded in 1994, Symphonix Devices, Inc. is a hearing management company dedicated to developing a family of products to improve communication ability and quality of life for the millions of hearing-impaired individuals who cannot benefit from current hearing technology. Symphonix` Vibrant Soundbridge is a surgical implant designed to work with the natural structures of the middle ear to enhance hearing and communication ability for people with hearing impairment. The device can be implanted during a short, outpatient surgical procedure. Worldwide, more than 350 patients have been implanted with Vibrant Soundbridges. More information about Symphonix can be found at Website://www.symphonix.com.

Except for historical information, statements made in this press release are `forward looking statements` and are subject to a number of uncertainties that could cause actual results to differ materially from the statements made. Such risks and uncertainties include, but are not limited to, the risks that regulatory approvals will not be obtained in a timely manner, or at all, and that the Company`s products will not achieve widespread market acceptance. For further information, refer to the risk factors described in the Company`s Form 10Q for the quarter ended March 31, 2000.

Vibrant is a registered trademark of Symphonix Devices, Inc. Soundbridge is a trademark of Symphonix Devices, Inc.

The Vibrant Soundbridge is an investigational device and is limited by Federal law to investigational use.

For more information contact: Roslyn Golden, [e-mail], ext. 133, or Jeanne McAdara, [e-mail], ext. 164, both of Fischer & Partners, Inc., 310-577-7870, for Symphonix Devices, Inc.; or Investors: 877/FOR-SMPX.

SOURCE Symphonix Devices, Inc.



CONTACT: Media: Roslyn Golden, [e-mail], ext. 133, or Jeanne McAdara, [e-mail], ext. 164, both of Fischer &; Partners, Inc., 310-577-7870, for Symphonix Devices, Inc.; or Investors: 877/FOR-SMPX (SMPX) Website://www.prnewswire.com

(C) 2000 PR Newswire. All rights reserved.




----- Original Message -----
From: [e-mail]
To: [e-mail]
Sent: Monday, July 24, 2000 1:51 PM
Subject: Your News Summary For 07/24/00

[A.TH.]

Hi sacrow,
warst wieder mal schneller als ich.
Habe die Mail auch erhalten. Sieht doch verdammt gut aus. Kann nur hoffen, daß es heute an der Nasdaq zu richtigem Volumen und steigenden Kursen kommt. Nach der Meldung sollten wir heute zumindest die 8€ bzw. 8$ sehen.
Gruß an alle
A.TH.

[A.TH.]

@backgroundinformer
ask heißt ausgeschrieben asked und kommt aus dem Englischen. Bedeutet Angebot ( Brief )
Das Gegenteil ist bid und bedeutet Nachfrage ( Geld )

Wo man den Kurs bei Comdirect nachschaut weiß ich allerdings auch nicht.

Gruß A.TH.

[A.TH.]

Eröffnung an der Nasdaq mit 6 7/32 $. Entspricht 6,53 $ So kann`s weitergehen.

[IWEG]

Das um 15 min zeitverzögerte bid/ask gibt es z.B. unter www.comdirect.de. Einfach in die Kursabfrage das US-Kürzel SMPX eintragen.

[ajb2000]

Der wahrscheinliche Hintergrund...

das der Kurs der Aktie gestern nicht in die Höhe schnellte, ist der verunsicherte Markt. SMPX hatte seine Höchststände bei $ 17. Anfang diesen Jahres hat sich ein Boden gebildet der jetzt vorbei scheint. Charttechnisch ist die Aktie trotz der großen Schwankungen in einem Aufwärtstrend.
SMPX muss nun beweisen, dass sie ein einzigartiges Produkt auch vermarkten können. Da sie als Kooperationspartner die Siemens AG haben, sehe ich kein Problem, da alleine dieses Unternhemen schon einen großen Vertrauensbeweis geniesst. Siemens würde sich wohl kaum an irgend einem Unternehmen beteiligen, was keinen Erfolg versprechen würde.
Aufgrund der derzeitigen Einzigartigkeit des Produkts, der vorangegangenen erfolgreichen Testreihen und der Kursregion, in der sich SMPX einst bewegte, sehe ich auf Sicht von 6 Monaten ein Kursziel von $ 20 für sehr gut möglich.
P.S.: Wartet die Herbstralley ab!!

[Viva-los-Tioz]

@steperjo+A.TH.

Hi! habt ihr schon News über Symphonix? beim Kurs tut sich ja zur Zeit nicht viel.
Gruss,
viva

[rolla]

es tut sich doch was derzeit runter auf 5,70 E
a.r.

[j-l-picard]

Tach auch,
kann mir mal jemand sagen warum die Umsätze heute so in den Keller gegangen sind? Was ist aus der Fantasie der Zulassung geworden?

[andyht]

Gestern Abend bei Quotentacker,letztes ASK 10 1/2-entweder ein Fehler
oder es Tut sich was. Ein Umsatz von nur 90000 (bei den Amis)war ja auch nich gerade berauschend.

Andyht

[andyht]

Das mit den 10 1/2 hat sich wohl erledigt,hat Quotentacker soeben wieder umgestellt auf 5 1/4.Naja wäre auch zu schön gewesen.
Habt Ihr die Umsätze Heute geshen? WANSIN ,ganze 1180 Stück bis jetzt.
Wird Zeit das sich bald mal was tut.

andyht

[Küchenfee]

Wird heute in den USA nicht gehandelt oder was ? Ich meine bin sehr froh drüber.

[zockermartin]

Hallo Leute,

gibts denn nirgendwo mehr News.....

Wannstartet Symphonix endlich durch....

Wer weiß neues zu berichten!????

Gruß
Zockermartin

[A.TH.]

Hi Zockermann,

hier hilft nur aussitzen. Es gibt keine Neuigkeiten seit der FDA Sitzing am 20.07.00. Die Umsätze sind auch alles andere als berauschend.
Immerhin kann ich hier keine 8€ je Aktie verlieren.
Gruß A.TH.

[j-l-picard]

Was neues von der Symphonix Homepage:

David Fabry, Ph.D., director of audiology at the Mayo Clinic, participated in the FDA panel review. “The compiled data from all of the clinical trial sites is quite compelling,” Dr. Fabry said. “The national trial results demonstrate that the vast majority of patients are more satisfied with the Vibrant Soundbridge, as compared to their hearing aids, in the key areas where hearing aids traditionally have limitations. Namely, effectiveness in background noise, overall fit and comfort, and the sound of their own voice. The Vibrant Soundbridge is a welcome addition to the options available for the hearing impaired.”

Symphonix is now awaiting final authorization from the FDA to begin commercial operations in the United States. “We are confident that we can meet the conditions as outlined by the panel for approval,” Mr. Davis said. “The company is committed to working with the agency to bring this breakthrough technology to the public as soon as possible.”


Ich denke sobald die Bürokratie überwunden ist und Symphonix in die Vermarktung einsteigen kann werden wir wieder bessere Kurse sehen. Die FDA ist halt auch nur eine Behörde und wie es da läuft brauche ich ja keinem zu erzählen.
Ganzer Artikel unter: http://www.shareholder.com/symphonix/news/20000724-18152.cfm

Gruß Captain Picard

[rolla]

was ist mit symphonix los ?
aktueller Kurs 2,85E
a.r.

[j-l-picard]

Hallo rolla
Ist sehr merkwürdig!!!! Der Kurs war für sehr kurze Zeit auf diesem Niveau. Hab ich bis jetzt noch nicht erlebt und ich kann es leider auch nicht erklären!
Hat jemand anderes eine Ahnung????

Gruß Captain Picard

[A.TH.]

Kann mir das ganze nur als Systemfehler erklären. Der Makler kann und darf nicht einen Kurs machen, der ca. 41 % unter dem normalen Kurs liegt. Bei Xetra ist so etwas möglich ( glaube ich zumindest ).
Gruß A.TH.

[andyht]

Hallo,Ob jetzt 2,85 oder 4,7€ ist beides nicht so Toll.Jetzt lohnt es sich sowiso nicht mehr zu verkaufen,währen bei mir 50%verlust.Ich habe versucht letzten Freitag und am Montag zu verkaufen ,keiner wollte welche haben.Umsätze waren einfach zu gering.
Jetzt behalte ich die Dinger ,und wenn ich darüber Alt werde.
Wenigsten gab es heute bei den Amis mal ein kleines Plus von 6%,aber auch nur bei sehr geringen Umsätzen.
Wie heißt es so schön :ABWARTEN UND TEE TRINKEN
Gruß Andyht

[andyht]

Hallo ,gibt es etwa keine SMPX Fans mehr ,hier ist ja nichts mehr los,wo sind denn all die möchtegern Gurus die sonst von Traumkursen sprachen,waren doch sonst täglich hier im Board vertreten?

Anscheinend trauen sie sich nicht mehr.

andyht

[Küchenfee]

Hi,
bei einer Mk von nur 60 mio US Dollar werden wir noch einiges an positiven erleben können. Es dauert alles seine Zeit. Laß ersteinmal die Umsätze kommen, dann explodiert das Ding . Also ruhig Blut und ein halbes Jahr warten und sehr freuen.
Wenn man kann sollte man nachkaufen.

KF

[MacMax]

Hi !

Am 20.7 war die Zulassung also danach noch 4 - 6 Wochen dann steigen die Kurse schon wieder.
Ich bin aktuell nicht in SMPX investiert werde aber (hoffentlich) rechzeitig wieder aufspringen.

@andyht
Ich weiss zwar nicht was ein möchtegern Guru ist aber warum soll ich mich mit SMPX beschäftigen wenn im Momnet eh nichts passiert ????
Und bei - 50 % bist Du leider selber Schuld schon mal was von Verlustbegrenzung gehört ?

SMPX kommt schon noch etwas Geduld !!

Gruss
MM

[andyht]

SYMPHONIX DEVICES INC (SMPX)
Quarterly Report (SEC form 10-Q)
Management`s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the attached condensed consolidated financial statements and footnotes thereto, and with the Company`s audited financial statements for the year ended December 31, 1999 and the footnotes thereto. The information set forth below contains forward-looking statements regarding research and development and publishing quarterly results and the Company`s actual results could differ materially from those anticipated in these forward looking statements as a result of certain factors, including those set forth below under "Factors That May Affect Future Results".

Overview


Symphonix Devices, Inc. ("Symphonix" or the "Company") develops, manufactures and markets a proprietary line of semi-implantable Soundbridge hearing devices for the management of hearing impairment, a medical disorder that affects approximately 28 million people in the United States alone. The Company is also developing a fully implantable Soundbridge. The Soundbridge is a middle ear implant technology designed to vibrate the small bones in the middle ear, enhancing the natural hearing process. The Vibrant Soundbridge, the family of semi-implantable devices, is currently being marketed in Europe in conjunction with the Company`s European distribution partner, Siemens Audiologische Technik GmbH ("Siemens"), and has received unanimous recommendation from the Ear, Nose, and Throat Medical Devices Advisory Panel of the Food and Drug Administration ("FDA") to approve, with conditions, the device for use in the United States. The fully implantable Soundbridge family is currently in development. The Company believes that the Soundbridge technology overcomes the inherent limitations of traditional hearing devices, and represents a novel approach in the management of hearing loss.

In September 1996, the Company initiated clinical trials of the first- generation Vibrant Soundbridge in both the United States and Europe. The Company received permission in the European Union ("EU") to affix the CE mark to the Vibrant Soundbridge in March 1998. Through a technology alliance with Siemens, the Company has developed its fourth generation Vibrant Soundbridge, based on 8- channel, digital signal processing. As of June, 2000, approximately 370 patients have been implanted with the Vibrant Soundbridge in over 70 centers in both the United States and Europe.

Results of Operations

Revenue. Revenue was $195,000 in the three months ended June 30, 2000 compared to $35,000 in the three months ended June 30, 1999. Revenue was $413,000 in the six months ended June 30, 2000 compared to $150,000 in the six months ended June 30, 1999. Revenue in these periods was the result of selling activities to distributors and direct sales in Europe and Latin America.

Cost of goods sold. Cost of goods sold decreased to $735,000 for the three months ended June 30, 2000 from $927,000 for the three months ended June 30, 1999 and decreased to $1,758,000 for the six months ended June 30, 2000 from $1,878,000 for the six months ended June 30, 1999. Cost of goods sold represents the direct cost of the products sold as well as manufacturing variances and provisions for warranty.


Research and Development Expenses. Research and development expenses were $1.8 million in the three months ended June 30, 2000 and June 30, 1999. Research and development expenses were $3.8 million in the six months ended June 30, 2000 compared to $3.5 million in the six months ended June 30, 1999. The Company has incurred substantial costs in 2000 and 1999 on clinical trials for its Vibrant Soundbridge. Research and development expenses consist primarily of personnel costs, professional services, materials, supplies and equipment in support of product development, clinical trials, regulatory submissions, and the preparation and filing of patent applications. The Company expects to continue to invest in research and development in the remainder of 2000 and 2001 primarily in the development of the totally implantable version of the Soundbridge.

Selling, General and Administrative Expenses. Selling, general and administrative expenses were $1.8 million in the three months ended June 30, 2000 compared to $1.6 million in the three months ended June 30, 1999 and were $3.5 million in the six months ended June 30, 2000 compared to $3.2 million in the six months ended June 30, 1999. Selling, general and administrative expenses consist primarily of personnel costs, promotional costs, legal and consulting costs. The Company expects to incur substantial increases in expenses in developing a U.S. sales and marketing organization in the remainder of 2000 and 2001.

Deferred compensation of $2.3 million was recorded in 1997, representing the difference between the exercise prices of certain options granted and the deemed fair value of the Company`s common stock on the options grant dates. Deferred compensation expense, net of terminated employees, attributed to such options, was $155,000 during the six months ended June 30, 2000 and $278,000 during the six months ended June 30, 1999. The remaining deferred compensation will be amortized over the vesting period of the options (generally four years).

Interest Income (Expense). Interest income, net of expense, decreased to $75,000 in the three months ended June 30, 2000 from $189,000 in the three months ended June 30, 1999 and decreased to $155,000 for the six months ended June 30, 2000 from $439,000 for the six months ended June 30, 1999. The reduction in net interest income was due to the reduction in the Company`s cash and short-term investment balances. Interest earned in the future will depend on the Company`s funding cycles and prevailing interest rates.

Income Taxes. To date, the Company has not incurred any U.S. income tax obligations. At December 31, 1999, the Company had net operating loss carryforwards of approximately $32.5 million for federal and $21.3 million for state income tax purposes, which will expire at various dates through 2014 and 2004, respectively, if not utilized. The principal differences between losses for financial and tax reporting purposes are the result of the capitalization of research and development and start-up expenses for tax purposes. Federal and state tax laws contain provisions that may limit the net operating loss carryforwards that can be used in any given year, should certain changes in the beneficial ownership of the Company`s outstanding common stock occur. Such events could limit the future of the Company`s net operating loss carryforwards.


Liquidity and Capital Resources

Since inception, the Company has funded its operations and its capital investments from proceeds from its initial public offering completed in February 1998 totaling $28.4 million, from the private sale of equity securities, totaling $26.5 million, from equipment lease financing totaling $1.3 million, from a private placement with Siemens Audiologische Technik GmbH totaling $5.0 million and from bank borrowings totaling, net, $2.0 million. At June 30, 2000, the Company had $3.7 million in working capital, and its primary source of liquidity was $6.8 million in cash, cash equivalents and short-term investments.

Symphonix used $7.7 million in cash for operations in the six months ended June 30, 2000, compared to $7.3 million in the six months ended June 30, 1999 primarily in funding its operating losses.

Capital expenditures, primarily related to the Company`s research and development and manufacturing activities, were $234,000 and $133,000 in the six months ended June 30, 2000 and 1999. At June 30, 2000, the Company did not have any material commitments for capital expenditures.

The Company has a loan agreement with a bank that provides for borrowings of up to $2.0 million and for the issuance of letters of credit up to $250,000. At June 30, 2000, the Company had borrowings of $1.8 million and an outstanding letter of credit in the amount of $195,000 under the loan agreement. Borrowings under the loan agreement are repayable over four years commencing in January 2000.

The Company will expend substantial funds in the future for research and development, preclinical and clinical testing, capital expenditures and the manufacturing, marketing and sale of its products. The timing and amount of spending of such capital resources cannot be accurately predicted and will depend on several factors, including the progress of its research and development efforts and preclinical and clinical activities, competing technological and market developments, the time and costs of obtaining regulatory approvals, the time and costs involved in filing, prosecuting and enforcing patent claims, the progress and cost of commercialization of products currently under development, market acceptance and demand for the Company`s products if approved for marketing and other factors not within the Company`s control. The Company believes that its existing capital will be sufficient to fund its operations and its capital investments through the second half of 2000. Additionally, Siemens is committed to a purchase of $5.0 million of the Company`s common stock to be payable at the time of the premarket approval ("PMA") of the Company`s Vibrant Soundbridge product. Commencing in June 2000, the Company expects to incur substantial expenses in developing a U.S. sales and marketing organization. To fully develop such a capability and to effectively launch its products commercially in the United States, if approved by the U.S. Food and Drug Administration ("FDA"), the Company expects that it will have to raise additional financing. There can be no assurance that such additional financing will be available on a timely basis on terms acceptable to the Company, or at all, or that such financing will not be dilutive to stockholders. If adequate funds are not available, the Company could be required to delay development or commercialization of certain of its products, license to third parties the rights to commercialize


certain products or technologies that the Company would otherwise seek to commercialize for itself, or reduce the marketing, customer support or other resources devoted to certain of its products, any of which could have a material adverse effect on the Company`s business, financial condition and results of operations.

Recent Accounting Pronouncements

In December 1999, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 101 ("SAB 101"), Revenue Recognition, which outlines the basic criteria that must be met to recognize revenue and provides guidance for presentation of revenue and for disclosure related to revenue recognition policies in financial statements filed with the SEC. In June 2000, the SEC issued SAB 101B which delays the implementation of SAB 101 until no later than the fourth fiscal quarter of fiscal years beginning after December 15, 1999. The Company is currently evaluating the effect, if any, that the adoption of SAB 101 will have on the current revenue recognition policy.


In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 133, ("SFAS 133"), Accounting for Derivative Instruments and Hedging Activities. SFAS 133 establishes methods of accounting and reporting for derivative instruments and hedging activities related to those instruments as well as other hedging activities, and is effective for all fiscal quarters for all fiscal years beginning after June 15, 2000, as amended by SFAS 137. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. To date, the Company has not engaged in derivative or hedging activities.

In March 2000, the FASB issued Interpretation No.44, Accounting for Certain Transactions Involving Stock Compensation - an interpretation of APB Opinion No. 25 ("FIN 44"). This Interpretation clarifies the definition of an employee for the purposes of applying Accounting Practice Board Opinion No. 25, Accounting for Stock Issued to Employees, the criteria for determining whether a plan qualifies as a noncompensatory plan, the accounting consequences of various modifications to the terms of a previously fixed stock option or award, and the accounting for an exchange of stock compensation awards in a business combination. This Interpretation is effective July 1, 2000, but certain conclusions in this Interpretation cover specific events that occur after either December 15, 1998, or January 12, 2000. The Company believes that FIN 44 will not have a material effect on the financial position or results of operation of the Company.

Factors That May Affect Future Results

History of Losses and Expectation of Future Losses. At June 30, 2000, the Company had an accumulated deficit of $57.2 million. Since the Company`s inception in 1994, substantially all of the Company`s resources have been dedicated to research and development, clinical trials, establishment of a European sales and marketing organization and the initiation of sales and marketing activities in Europe. In March 1998, the Company received the authorization to affix the CE Mark to the Vibrant and Vibrant P Soundbridges, permitting the initiation of commercial sales in the European Union ("EU"). In May 1999, the Company received authorization to affix the CE Mark to the Vibrant D Soundbridge. Although the Company has commenced selling the Vibrant P and Vibrant D Soundbridges in Europe, through June 30, 2000 the Company has not generated significant revenues from these sales. The Company received CE Mark approval for the Vibrant HF Soundbridge in July 1998. In the United States, a regulatory application for commercial use of the Company`s Vibrant P and Vibrant D Soundbridges was submitted in September 1999. The Vibrant HF Soundbridge will require additional clinical testing prior to the submission of a regulatory application for commercial use. All of the Company`s other products will require additional development, and preclinical and clinical testing prior to the submission of a regulatory application for commercial use internationally and domestically. Since the Vibrant P and Vibrant D Soundbridges only recently became available for sale in the EU and are not currently available for sale in the United States, significant product revenues will not be realized for at least several years, if ever. The Company expects its operating losses to continue at least through the year 2001 as it continues to expend substantial funds for clinical trials in support of regulatory approvals, expansion of research and development activities and establishment of commercial-scale manufacturing and sales and marketing capabilities. There can be no assurance that any of the Company`s Soundbridges will be successfully commercialized internationally or in the United States or that the Company will achieve significant revenues from


product sales. In addition, there can be no assurance that the Company will achieve or sustain profitability in the future. The Company`s results of operations may fluctuate from quarter to quarter or year to year and will depend upon numerous factors, the timing and scope of research and development efforts, the extent to which the Company`s products gain market acceptance or achieve reasonable reimbursement levels, the timing of scale-up of manufacturing capabilities, the timing of expansion of sales and marketing activities and competition.

Limited Clinical Testing Experience. In the United States, the Company has received unanimous recommendation from the Ear, Nose, and Throat Medical Devices Advisory Panel for the FDA to approve, with conditions, the device for use in the U.S. of the Vibrant P and Vibrant D Soundbridges. The Company has also received approval of an Investigational Device Exemption ("IDE") to conduct a clinical trial of the Vibrant HF Soundbridge. The Company`s totally- implantable Soundbridge, currently under development, will require additional development, clinical trials and regulatory approval prior to commercialization. The results from preclinical studies and early clinical trials may not be indicative of results obtained in later clinical trials, and there can be no assurance that clinical trials conducted by the Company will demonstrate sufficient safety and efficacy to obtain requisite approvals.

The rate of completion of the Company`s clinical trials may be delayed by many factors, including slower than anticipated patient enrollment or adverse events occurring during clinical trials. Completion of preclinical and clinical activities may take several years, and the length of time for completion of the required studies is unpredictable. In addition, data obtained from preclinical and clinical activities are susceptible to varying interpretations, which could delay, limit or prevent regulatory approval. No assurance can be given that any of the Company`s clinical trials will be successfully completed on a timely basis, or at all, that additional clinical trials will be allowed by the FDA or other regulatory authorities or that such clinical trials will commence as planned. Any delays in the Company`s clinical trials would have a material adverse effect on the Company`s business, financial condition and results of operations. Success in preclinical studies or early stage clinical trials does not assure success in later stage clinical trials.

Reliance on FMT Technology. The Company has concentrated its efforts primarily on the development, implementation and acceptance of the Floating Mass Transducer ("FMT"), the patented core direct drive technology upon which all of the Company`s Soundbridges are based. The Company`s Soundbridges employ a direct drive approach to the management of hearing impairment, which is a novel development. There can be no assurance that the Company`s Soundbridges, based on the Company`s FMT technology, will prove to be safe and effective, or that if proven safe and effective, can be manufactured at a reasonable cost or successfully commercialized.

Government Regulation. The Company`s medical products, such as the Vibrant Soundbridge, are regulated as medical devices. Accordingly, clinical trials, product development, labeling, manufacturing processes and promotional activities are subject to extensive review and rigorous regulation by government agencies in most countries in which the Company will seek to commercialize its products.




United States

In the United States, the Company`s products are subject to applicable provisions of the United States Federal Food, Drug, and Cosmetic Act ("FDC Act"), and other federal statutes and regulations governing, among other things, the design, manufacture, testing, safety, labeling, storage, record keeping, reporting, approval, advertising and promotion of medical devices. Noncompliance with applicable requirements can result in warning letters, fines, recalls or seizure of products, civil penalties, injunctions, total or partial suspension of production, withdrawal of approval or refusal to approve new marketing applications and criminal prosecution. Changes in existing requirements or adoption of new requirements could have a material adverse effect on the Company`s business, financial condition and results of operations.

Pursuant to the FDC Act, the FDA regulates the design, manufacture, distribution, preclinical and clinical study and approval of medical devices in the United States. Medical devices are classified in one of three classes (Class I, Class II or Class III) on the basis of the controls necessary to reasonably assure their safety and effectiveness. Safety and effectiveness is considered to be reasonably assured for Class I devices through general controls (e.g., labeling, premarket notification and adherence to current Quality Systems ("QS") regulations) and for Class II devices through the use of additional special controls (e.g., performance standards, post-market surveillance, patient registries and FDA guidelines).

Generally, Class III devices are those which must receive premarket approval by the FDA to reasonably assure their safety and effectiveness (e.g., life-sustaining, life-supporting and implantable devices, or new devices which have been found not to be substantially equivalent to legally marketed devices, or devices whose safety and effectiveness cannot be reasonably assured through general controls, even if supplemented by additional special controls). Active implantable devices, such as the Company`s implantable middle ear hearing devices, are considered Class III devices.

Before a new device can be introduced to the market, the manufacturer generally must obtain FDA clearance through a 510(k) Premarket Notification or FDA approval through a PMA application. While the Company has no products for which it expects to seek 510(k) clearance, it may file 510(k) submissions with respect to future products. A 510(k) clearance will generally only be granted if the information submitted to the FDA establishes that the device is "substantially equivalent" to a legally marketed predicate medical device. Frequently, the FDA will require clinical data in support of a 510(k) submission, and the 510(k) process can become time-consuming and expensive. Significant modifications of the labeling, manufacturing and design of any product that has been cleared through the 510(k) process will require a new 510(k) Premarket Notification, if those modifications could significantly affect the safety, effectiveness or intended use of the device.

A PMA application must be submitted if the device cannot be cleared through the 510(k) process. A PMA must be supported by extensive data, including, but not limited to, technical, preclinical, clinical trials, manufacturing, and labeling to demonstrate the safety and effectiveness of the device. The Company believes that all versions of the Vibrant Soundbridge currently under development are Class III devices and will require a PMA, as will future configurations of implantable middle ear hearing devices. The FDA has implemented a new streamlined PMA process called the modular PMA. Under the modular PMA process, modules reflecting the content


requirements of a traditional PMA can be submitted as they are completed, allowing them to be reviewed and approved in a sequential manner.

Before the Company`s products can be commercialized in the United States, the Company must submit, in a PMA application, extensive data on preclinical studies and clinical trials, device design, manufacturing, labeling, promotion and advertising, as well as other aspects of the product. In addition, the Company must submit clinical data gathered in trials conducted under an IDE demonstrating to the satisfaction of the FDA that the product is safe and effective for its labeling claims, and obtain marketing approval from the FDA. Phase I of the IDE study has been completed. Phase I was limited to two sites and five subjects and was intended to test the safety and provide preliminary evidence of the effectiveness of the device and the surgical procedure used to implant the device. In November 1997, the Company filed an IDE supplement summarizing the Phase I results, finalizing the study protocol and proposed labeling claims, providing technical information regarding the Vibrant P Soundbridge, and requested permission to proceed to the pivotal study. In December 1997, the FDA approved the multi-center pivotal study in 55 subjects at up to 12 sites with the second generation Vibrant P Soundbridge. In November 1998 the Company received FDA approval of an IDE supplement to include the Vibrant HF Soundbridge in this study. To facilitate enrollment of a greater number of subjects who receive the Vibrant HF Soundbridge, on December 22, 1998, the Company requested FDA approval of an IDE supplement to allow an additional 15 subjects. This IDE supplement was approved by the FDA on January 19, 1999 and the Company has enrolled 8 subjects in this part of the clinical study. In March 1999 the FDA approved an IDE supplement permitting the evaluation of the Vibrant D Soundbridge. Subjects who had completed the clinical trial protocol for the Vibrant P Soundbridge were eligible for enrollment in the evaluation of the Vibrant D Soundbridge. In February 2000 the Company amended its PMA application and the FDA deemed it fileable. Data from the PMA were reviewed by the Ear, Nose, and Throat Medical Devices Advisory Panel of the FDA in July 2000, and the panel voted unanimously to recommend approval, with conditions, of the Vibrant P and Vibrant D Soundbridges for use in the U.S. There can be no assurance that the Company`s clinical trial effort will progress as expected, will not be delayed or that such effort will lead to the successful development of any product. No assurance can be given that any of the Company`s clinical trials will continue to be allowed by the FDA or other regulatory agencies or that clinical trials will commence as planned.

Any delays in the Company`s clinical trials would have a material adverse effect on the Company`s business, financial condition and results of operations. Success in preclinical studies or early stage clinical trials does not assure success in later stage clinical trials. Data obtained from preclinical and clinical activities are susceptible to varying interpretations which could delay, limit or prevent regulatory approval. Further, there can be no assurance that if such testing of products under development is completed, any such devices will be accepted for formal review by the FDA, or approved by the FDA for marketing in the United States.

New PMAs or PMA supplements are required for significant modifications to the manufacture, labeling and design of a device that is approved through the PMA process. Supplements to a PMA often require submission of the same type of information as a PMA, except that the supplement is limited to information needed to support any changes from the device covered by the original PMA and may not require as extensive clinical data or the convening of an advisory panel.



The PMA process can be expensive, uncertain and can frequently require several years. Even when a PMA is approved, the FDA may impose restrictions on the indications for which the device can be marketed. There can be no assurance that the Company will be able to obtain necessary approvals on a timely basis, or at all, and delays in obtaining or failure to obtain such approvals, the loss of previously obtained approvals, or failure to comply with existing or future regulatory requirements could have an adverse effect on the Company`s business, financial condition and results of operations.

Subsequent to the receipt of a FDA approval, the Company will continue to be regulated by the FDA with regard to the reporting of adverse events related to its products, and ongoing compliance with QS regulation. The Company`s manufacturing facility must be registered with the FDA and the California Department of Health Services ("CDHS") and will be subject to periodic inspections by the FDA and by the CDHS. A Device Manufacturing License has been issued by the State of California and this license must be renewed annually for the Company to continue manufacture of medical devices in California.

Europe

The primary regulatory environment in Europe is that of the EU which consists of 15 countries encompassing most of the major countries in Europe. The EU has adopted numerous directives and standards regulating the design, manufacture, clinical trial, labeling, and adverse event reporting for medical devices. The principal directives prescribing the laws and regulations pertaining to medical devices in the EU are the Medical Devices Directive 93/42/EEC ("MDD") and the Active Implantable Medical Devices Directive 90/385/EEC ("AIMDD"). In the EU, the Company`s soundbridges will be regulated as active implantables and therefore be governed by the AIMDD. For products, such as those of the Company, that have not previously been commercialized in the EU, CE marking is required prior to initiation of sales in the EU. Certain other countries, such as Switzerland, have voluntarily adopted laws and regulations that mirror those of the EU with respect to medical devices.

Devices that comply with the requirements of a relevant directive will be entitled to bear CE conformity marking, indicating that the device conforms with the essential requirements of the applicable directive, and accordingly, can be commercially distributed throughout the EU. The method of assessing conformity varies depending on the class of the product, but normally involves a combination of self-assessment by the manufacturer and a third-party assessment by a Notified Body. This third party assessment may consist of an audit of the manufacturer`s quality system and specific testing of the manufacturer`s product. An assessment by a Notified Body in one country within the EU is required in order for a manufacturer to commercially distribute the product throughout the EU.

For purposes of determining the necessary steps for assessing conformity, devices are classified under the Directives as Class I, Class IIa, Class IIb, Class III, or Active Implantable Medical Devices. Devices having a higher classification are considered to have a higher risk and, accordingly, are subject to more controls in order to bear CE marking. The Vibrant Soundbridge is designated as an Active Implantable Medical Device. Essential requirements under the AIMDD include substantiating that the device meets the manufacturer`s performance claims and that safety


issues, if any, constitute an acceptable risk when weighed against the intended benefits of the device. The two principal aspects of assessing conformity for Active Implantable Medical Devices are determinations from the Notified Body that the processes employed in the design and manufacture of a device qualify as a full quality system in compliance with applicable standards (e.g., EN ISO 9001, EN 46001 and 90/385/EEC), and that the technical, preclinical, and clinical data gathered on the device are adequate to support CE marking.

The Company has undergone an inspection by its Notified Body and its quality system has been certified by the Notified Body as being in compliance with the required standards. The Company has received approval to affix the CE mark to the Vibrant P, the Vibrant HF, and the Vibrant D Soundbridges. To satisfy these requirements, the Company generally must complete a clinical trial conducted under European clinical trial standards (EN 540) to determine the safety and performance of the products. The Vibrant HF and Vibrant D Soundbridges utilize the same implanted component as the Vibrant P Soundbridge. Accordingly, the Notified Body did not require additional clinical data for the Vibrant HF and Vibrant D Soundbridges. The Company must continue to pass annual EN ISO 9001, EN 46001 and AIMDD 2.3 quality system audits in order to retain the authorization to affix the CE mark to its products.

Once a manufacturer has satisfactorily completed the regulatory compliance tasks required by the directives and received favorable determinations by the Notified Body, it is eligible to place the CE mark on its products. Manufacturers are subject to ongoing regulation under the AIMDD. The quality system will be subject to periodic audit and recertification, and serious adverse events must be reported to the authorities in the country where the incident takes place. If such incidents occur, the manufacturer may have to take remedial action, including withdrawal of the product from the EU market.

While no additional premarket approvals in individual EU countries are required, prior to the marketing of a device bearing the CE mark, practical complications with respect to market introduction may occur. For example, differences among countries have arisen with regard to labeling requirements. Also, as the directives do not cover reimbursement and distribution practices, differences may occur in these and other areas.

No Assurance of Market Acceptance. The market acceptance of the Company`s Soundbridges will depend upon their acceptance by the medical community and patients as clinically useful, reliable and cost-effective compared to other devices. Clinical acceptance will depend on numerous factors, including the establishment of the safety and the effectiveness of the Soundbridge`s ability to drive the ossicles directly and improve hearing over currently available hearing aids. Clinical acceptance will also depend on the receipt of regulatory approvals in the United States and the Company`s ability to adequately train ear surgeons on the techniques for implanting the Company`s Soundbridges. There can be no assurance that the Company`s Soundbridges will be preferable alternatives to existing devices, some of which, such as the acoustic hearing aid, do not require surgery, or that the Company`s Soundbridges will not be rendered obsolete or noncompetitive by products under development by other companies. Patient acceptance of the Company`s Soundbridges will depend in part upon physician, audiologist and surgeon recommendations as well as other factors, including the effectiveness, safety, reliability and invasiveness of the procedure as


compared to established approaches. Prior to undergoing surgery for the implantation of the Company`s Soundbridge, a patient may speak with a number of medical professionals, including the patient`s primary care physician, an audiologist, an ENT specialist, as well as surgeons who specialize in ear surgery. The failure by any of these medical professionals to favorably recommend the Company`s products and the surgery required to implant the Soundbridge could limit the number of potential patients who are introduced to an ear surgeon as candidates for the Company`s Soundbridges. Even if the Company`s Soundbridges are adopted by the medical community, a significant market may not develop for the Company`s products unless acceptable reimbursement from health care payors is available. There can be no assurance that the Company`s Soundbridges will be accepted by the medical community or consumers, that acceptable reimbursement from third-party payors will be available or that market demand for such products will be sufficient to allow the Company to achieve profitable operations. Failure of the Company`s Soundbridges, for whatever reason, to achieve significant adoption by the medical community or consumers or failure of the Company`s products to achieve any significant market acceptance would have a material adverse effect on the Company`s business, financial condition and results of operations.

Highly Competitive Market; Risk of Competing Hearing Devices. The medical device industry is subject to intense competition in the United States and abroad. The Company believes its products will compete primarily with the traditional approaches to managing hearing impairment, principally hearing aids. Principal manufacturers of acoustic hearing aids include Siemens Hearing Instruments, Inc., Starkey Laboratories Inc., Dahlberg Inc., GN ReSound Inc., Oticon, Inc., Widex Hearing Aid Co., Inc. and Phonak Inc. There can be no assurance that the Company`s Soundbridges will be able to successfully compete with established hearing aid products. Although, to the Company`s knowledge, none of these acoustic hearing aid manufacturers are currently developing direct drive devices, there can be no assurance that these potential competitors will not succeed in developing technologies and products in the future that are more effective, less expensive than those being developed by the Company or that do not require surgery. The Company is aware of several university research groups and development-stage companies that have active research or development programs related to direct drive devices for sensorineural hearing loss. One such company, IMPLEX AG Hearing Technology, was authorized by their European Notified Body on November 15, 1999 to affix the CE mark on their totally integrated cochlear amplifier (TICA). This company has reported its intent to pursue a clinical investigation in the U.S. to support FDA regulatory requirements, but to the Company`s knowledge, has not been given IDE approval to initiate those trials. A US based company, Otologics, LLC is developing a semi- implantable direct drive device for sensorineural hearing loss called the MET (middle ear transducer). This device has begun the FDA regulatory process, completing the Phase I (feasibility) study and recently initiating limited multicenter clinical trials. In addition, some large medical device companies, some of which are currently marketing implantable medical devices, may develop programs in hearing management. Certain of these companies have substantially greater financial, technical, manufacturing, marketing and other resources than the Company. In addition, there can be no assurance that certain of the Company`s competitors will not develop technologies and products that may be more effective in managing hearing impairment than the Company`s products or that render the Company`s products obsolete.


The Company believes that the primary competitive factors in the hearing management market will be the quality of the hearing enhancement, safety, whether surgery is required, reliability, endorsement by the surgeon and believes that it will be competitive with respect to these factors. Nonetheless, because the Company`s products are either under development or in the very early stages of commercialization, the relative competitive position of the Company in the future is difficult to predict.

Limited Manufacturing Experience; Scale-Up Risk; Dependence on Key Suppliers. The Company currently manufactures its products in limited quantities for laboratory testing, for its clinical trials and for initial commercial sales. The manufacture of the Company`s Soundbridges is a complex operation involving a number of separate processes, components and assemblies. Each device is assembled and individually tested by the Company. The manufacturing process consists primarily of assembly of internally manufactured and purchased components and subassemblies, and certain processes are performed in an environmentally controlled area. After completion of the manufacturing and testing processes, implantable devices are sterilized by a sub-contracted supplier. The Company has no experience manufacturing its products in the volumes or with the yields that will be necessary for the Company to achieve significant commercial sales, and there can be no assurance that the Company can establish high volume manufacturing capacity or, if established, that the Company will be able to manufacture its products in high volumes with commercially acceptable yields. The Company will need to expend significant capital resources and develop manufacturing expertise to establish commercial- scale manufacturing capabilities. Furthermore, prior to approval of a PMA, the Company`s facilities, procedures and practices will be subject to a pre-approval inspection by the FDA. The Company`s inability to successfully manufacture or commercialize its soundbridges in a timely matter could have a material adverse effect on the Company`s business, financial condition and results of operations.

Raw materials, components and subassemblies for the Company`s Soundbridges are purchased from various qualified suppliers and are subject to stringent quality specifications and inspections. The Company conducts quality audits of its key suppliers, several of whom are experienced in the supply of components to manufacturers of implantable medical devices, such as pacemakers, defibrillators and drug delivery pumps. A number of components and subassemblies, such as silicone, signal processing electronics and implant packaging are provided by single source suppliers. Certain components of the Vibrant P, Vibrant D and Vibrant HF soundbridges, the analog and digital signal processing microcircuits, are provided by sole source suppliers. None of the Company`s suppliers is contractually obligated to continue to supply the Company nor is the Company contractually obligated to buy from a particular supplier. For certain of these components and subassemblies, there are relatively few alternative sources of supply, and establishing additional or replacement suppliers for such components and subassemblies could not be accomplished quickly. In addition, if the Company wishes to significantly modify its manufacturing processes or change the supplier of a critical component, additional approvals will be required from the FDA before the change can be implemented. Because of the long lead time for some components and subassemblies that are currently available from a single source, a supplier`s inability or failure to supply such components or subassemblies in a timely manner or the Company`s decision to change suppliers could have a material adverse effect on the Company`s business, financial condition and results of operations.


The Company`s manufacturing facilities are subject to periodic inspection by regulatory authorities, and its operations must undergo QS regulation compliance inspections conducted by the FDA and corresponding state agencies. Additionally, prior to approval of a PMA, the Company`s and its third-party manufacturers` facilities, procedures and practices will be subject to pre- approval QS regulation inspections. The Company has been inspected by the Food and Drug Branch of the CDHS and a Device Manufacturing License has been issued to the Company. The Company will be required to comply with the QS regulation requirements in order to produce products for sale in the United States and with applicable quality system standards and directives in order to produce products for sale in the EU. Any failure of the Company to comply with the QS regulation or applicable standards and directives may result in the Company being required to take corrective actions, such as modification of its policies and procedures. Pending such corrective actions, the Company could be unable to manufacture or ship any products, which could have a material adverse effect on the Company`s business, financial condition and results of operations.

Dependence upon Patents and Proprietary Technology. In the United States, the Company holds 13 issued patents and 10 pending patent applications. Additionally, the Company has 1 issued and 24 pending foreign patent applications. These patents and patent applications generally cover the invention and application of the FMT as well as the specific application of the FMT and other concepts in the field of hearing impairment. In addition, the Company has licensed, on a royalty-free basis, a United States patent covering the magnetic attachment of an external audio processor to an implanted receiver. The Company`s success will depend in part on its ability to obtain patent protection for its products and processes, to preserve its trade secrets, and to operate without infringing or violating the proprietary rights of others.

The patent positions and trade secret provisions of medical device companies, including those of the Company, are uncertain and involve complex and evolving legal and factual questions. The coverage sought in a patent application either can be denied or significantly reduced before or after the patent is issued. Consequently, there can be no assurance that any patents from pending applications or from any future patent application will be issued, that the scope of the patent protection will exclude competitors or provide competitive advantages to the Company, that any of the Company`s patents will be held valid if subsequently challenged or that others will not claim rights in or ownership of the patents and other proprietary rights held by the Company. Since patent applications are secret until patents are issued in the United States or corresponding applications are published in other countries, and since publication of discoveries in the scientific or patent literature often lags behind actual discoveries, the Company cannot be certain that it was the first to file patent applications for such inventions.

In addition, there can be no assurance that competitors, many of which have substantial resources, will not seek to apply for and obtain patents that will prevent, limit or interfere with the Company`s ability to make, use or sell its products either in the United States or in international markets. Although the Company has conducted searches of patents issued to other companies, research or academic institutions or others, there can be no assurance that such patents do not exist, have not been filed or could not be filed or issued, which contain claims relating to the Company`s technology, products or processes. Patents issued and patent applications filed in the United States or internationally relating to medical devices are numerous and there can be no assurance that current


and potential competitors and other third parties have not filed, or in the future, will not file, applications for, or have not received or in the future will not receive, patents or obtain additional proprietary rights relating to products or processes used or proposed to be used by the Company. In addition, patent applications in foreign countries are maintained in secrecy for a period after filing. Publication of discoveries in the scientific or patent literature tends to lag behind actual discoveries and the filing of related patent applications. There may be pending applications, which if issued with claims in their present form, might provide proprietary rights to third parties relating to products or processes used or proposed to be used by the Company. The Company may be required to obtain licenses to patents or proprietary rights of others. Further, the laws of certain foreign countries do not protect the Company`s intellectual property rights to the same extent as do the laws of the United States. Litigation or regulatory proceedings, which could result in substantial cost and uncertainty to the Company, may also be necessary to enforce patent or other intellectual property rights of the Company or to determine the scope and validity of other parties` proprietary rights. There can be no assurance that the Company will have the financial resources to defend its patents from infringement or claims of invalidity.

The Company also relies upon trade secrets and other unpatented proprietary technology, and no assurance can be given that others will not independently develop substantially equivalent proprietary information and techniques or otherwise gain access to or disclose the Company`s proprietary technology or that the Company can meaningfully protect its rights in such unpatented proprietary technology. The Company`s policy is to require each of its employees, consultants, investigators and advisors to execute a confidentiality agreement upon the commencement of an employment or consulting relationship with the Company. These agreements generally provide that all inventions conceived by the individual during the term of the relationship shall be the exclusive property of the Company and shall be kept confidential and not be disclosed to third parties except in specified circumstances. There can be no assurance, however, that these agreements will provide meaningful protection for the Company`s proprietary information in the event of unauthorized use or disclosure of such information.

Recently Public Law 104-208 was signed into law in the United States and limits the enforcement of patents relating to the performance of surgical or medical procedures on a body. This law precludes medical practitioners and health care entities, which practice these procedures, from being sued for patent infringement. Therefore, depending upon how these limitations are interpreted by the courts, they could have a material adverse effect on the Company`s ability to enforce any of its proprietary methods or procedures deemed to be surgical or medical procedures on a body. In certain other countries outside the United States, patent coverage relating to the performance of surgical or medical procedures is not available. Therefore, patent coverage in such countries will be limited to the FMT or to narrower aspects of the FMT.

The medical device industry in general has been characterized by substantial litigation. Litigation regarding patent and other intellectual property rights, whether with or without merit, could be time-consuming and expensive to respond to and could distract the Company`s technical and management personnel. The Company may become involved in litigation to defend against claims of infringement by the Company, to enforce patents issued to the Company or to protect trade secrets of the Company. If any relevant claims of third-party patents are held as infringed and not


invalid in any litigation or administrative proceeding, the Company could be prevented from practicing the subject matter claimed in such patents, or would be required to obtain licenses from the patent owners of each such patent, or to redesign its products or processes to avoid infringement. In addition, in the event of any possible infringement, there can be no assurance that the Company would be successful in any attempt to redesign its products or processes to avoid such infringement or in obtaining licenses on terms acceptable to the Company, if at all. Accordingly, an adverse determination in a judicial or administrative proceeding or failure by the Company to redesign its products or processes or to obtain necessary licenses could prevent the Company from manufacturing and selling its products, which would have a material adverse effect on the Company`s business, financial condition and results of operations. Although the Company has not been involved in any litigation to date, in the future, costly and time-consuming litigation brought by the Company may be necessary to enforce patents issued to the Company, to protect trade secrets or know-how owned by the Company, or to determine the enforceability, scope and validity of the proprietary rights of others.


Future Capital Requirements; Uncertainty of Additional Funding. The Company will expend substantial funds in the future for research and development, preclinical and clinical testing, capital expenditures and the manufacturing, marketing and sale of its products. The timing and amount of spending of such capital resources cannot be accurately predicted and will depend upon several factors, including the progress of its research and development efforts and preclinical and clinical activities, competing technological and market developments, the time and costs of obtaining regulatory approvals, the time and costs involved in filing, prosecuting and enforcing patent claims, the progress and cost of commercialization of products currently under development, market acceptance and demand for the Company`s products in the United States, if approved for marketing, and internationally and other factors not within the Company`s control. On February 17, 1998, the Company completed an initial public offering of 2,300,000 shares of common stock. On February 27, 1998, the Company completed the sale of an additional 345,000 shares of common stock pursuant to the exercise by the underwriters of an over allotment option. On December 1, 1999 the Company completed a private placement of 1,000,000 common shares with Siemens Audiologische Technik GmbH. Net proceeds to the Company totaled approximately $33.4 million. Additionally, Siemens will purchase an additional $5.0 million common shares in a private placement in the event the FDA accepts the PMA of the Company`s Vibrant Soundbridge product. While the Company believes that the net proceeds of the offering, together with its previously existing capital resources and projected interest income, will be sufficient to fund its operations and its capital investments through the second half of 2000, there can be no assurance that the Company will not require additional financing prior to that time. In addition, there can be no assurance that such additional financing will be available on a timely basis on terms acceptable to the Company, or at all, or that such financing will not be dilutive to stockholders. If adequate funds are not available, the Company could be required to delay development or commercialization of certain of its products, to license to third parties the rights to commercialize certain products or technologies that the Company would otherwise seek to commercialize for itself, or to reduce the marketing, customer support or other resources devoted to certain of its products, any of which could have a material adverse effect on the Company`s business, financial condition and results of operations.


Lack of Sales, Marketing and Distribution Experience. The primary market for the Company`s products in the United States is well defined and highly concentrated. Of the approximately 10,000 ENT surgeons in the United States, approximately 400 are specialists in otology. The Company believes that it can address this market with a direct sales force. The Company`s strategy is to market its products initially to those 400 specialists in otology. Because the surgical procedure for implanting the Soundbridge utilizes many of the same techniques currently used by otologists, the Company believes that surgeon training will not be a significant impediment to market acceptance.

The Company intends to focus on the elements of the patient flow process and to create educational and other programs to stimulate patient flow at all levels, including going directly to the hearing-impaired patient. The Company will also seek to develop a high degree of awareness of the Soundbridge therapy by audiologists.

The Company has established a European sales and marketing organization which, as of June 30, 2000, is comprised of ten (10) sales, marketing and clinical support personnel with headquarters located in Basel, Switzerland. In December 1999, the Company established a distribution partnership with Siemens covering most of the markets in Europe. The Company believes this partnership will significantly enhance its presence, especially within the audiology community. In the United States, the Company intends to establish a direct sales force focused on both surgeons and audiologists. In other international markets, including Japan, the Company will seek to establish either a network of distributors or a strategic partner.

There can be no assurance that the Company will be able to build an adequate direct sales force or marketing organization in any country, that establishing a direct sales force or marketing organization will be cost- effective or that the Company`s sales and marketing efforts will be successful. In addition, the Company has entered into distribution agreements with only a limited number of international distributors. There can be no assurance that the Company will be able to enter into similar agreements with other qualified distributors on a timely basis on terms acceptable to the Company, or at all, or that such distributors will devote adequate resources to selling the Company`s products. Failure to establish an adequate direct sales force domestically and in select international markets, and to enter into successful distribution relationships, could have a material adverse effect on the Company`s business, financial condition and results of operations.

Uncertain Availability of Third-Party Reimbursement. The Company believes that its products will generally be purchased by hospitals and otology practices upon the recommendation of an otologic surgeon. In the United States, hospitals, physicians and other health care providers that purchase medical devices generally rely on third-party payors, principally Medicare, Medicaid, private health insurance plans, health maintenance organizations and other sources of reimbursement for health care costs, to reimburse all or part of the cost of the procedure in which the medical device is being used. Such third-party payors have become increasingly sensitive to cost containment in recent years and place a high degree of scrutiny on coverage and payment decisions for new technologies and procedures.


Hearing aids, which do not involve surgery and, in certain cases, are exempt from the requirement for 510(k) approval, are generally not reimbursed, although a modest reimbursement is provided under certain insurance plans. Traditionally, hearing aid users have paid for these devices directly. For cochlear implants, however, which are technologically advanced and FDA-approved through the PMA process for the treatment of profound hearing impairment, a reimbursement is available for the device, the audiological testing, and the surgery. Similarly, reimbursement is available for ossicular replacement prostheses that are FDA-approved for the treatment of conductive hearing loss.

The Company`s strategy is to pursue reimbursement for the Soundbridge, once a PMA is approved by the FDA, based on surgeon endorsement and demonstrated performance and quality of life improvement. Quality of life issues are included in the Company`s clinical trial to provide data in support of this reimbursement strategy. There can be no assurance that the Company will be able to demonstrate improvement in quality of life or that reimbursement will ever be available for the Company`s products.

Certain third-party payors are moving toward a managed care system in which they contract to provide comprehensive health care for a fixed cost per person. The fixed cost per person established by these third-party payors may be independent of the hospital`s cost incurred for the specific case and the specific devices used. Medicare and other third-party payors are increasingly scrutinizing whether to cover new products and the level of reimbursement for covered products. Because the Company`s hearing prostheses are currently under development and have not received FDA clearance or approval, uncertainty exists regarding the availability of third-party reimbursement for procedures that would use the Company`s products. Failure by physicians, hospitals and other potential users of the Company`s products to obtain sufficient reimbursement from third-party payors for the procedures in which the Company`s products are intended to be used, could have a material adverse effect on the Company`s business, financial condition and results of operations.

Third-party payors that do not use prospectively fixed payments increasingly use other cost-containment processes or require various outcomes data that may pose administrative hurdles to the use of the Company`s products. In addition, third-party payors may deny reimbursement if they determine that the device used in a procedure is unnecessary, inappropriate, experimental, used for a non-approved indication or is not cost-effective. Potential purchasers must determine that the clinical benefits of the Company`s products justify the additional cost or the additional effort required to obtain prior authorization or coverage and the uncertainty of actually obtaining such authorization or coverage.

Even after obtaining the necessary foreign regulatory approvals, market acceptance of the Company`s products and products currently under development in international markets will be dependent, in part, upon the availability of reimbursement within prevailing health care payment systems. Reimbursement and health care payment systems in international markets vary significantly by country, and include both government sponsored health care and private insurance. The Company believes that in Europe, the primary source of funding for products such as the Company`s products is the various government sponsored healthcare programs. Requirements for the granting of


reimbursement in many countries are not clearly specified and may involve the collection of additional clinical data in support of submissions to the appropriate health care administrations. There can be no assurance that any required data would be available on a timely basis or that any international reimbursement approvals will be obtained in a timely manner, if at all. Failure to receive international reimbursement approvals could have a material adverse effect on market acceptance of the Company`s products in the EU as well as in international markets in which such approvals are sought.

The Company believes that in the future reimbursement will be subject to increased restrictions both in the United States and in international markets. The Company believes that the overall escalating cost of medical products and services will continue to lead to increased pressures on the health care industry, both foreign and domestic, to reduce the cost of products and services, including the Company`s products and products currently under development. There can be no assurance in either the United States or international markets that third-party reimbursement and coverage will be available or adequate, that future legislation, regulation or reimbursement policies of third-party payors will not otherwise adversely affect the demand for the Company`s products or products currently under development or its ability to sell its products on a profitable basis. The unavailability of third- party payor coverage or the inadequacy of reimbursement could have a material adverse effect on the Company`s business, financial condition and results of operations.


Dependence upon Key Personnel. The Company`s future success depends in significant part upon the continued service of certain key scientific, technical and management personnel. Competition for such personnel is intense and there can be no assurance that the Company can retain its key scientific, technical and managerial personnel or that it can attract, assimilate or retain other highly qualified scientific, technical and managerial personnel in the future. The loss of key personnel, especially if without advance notice, or the inability to hire or retain qualified personnel could have a material adverse effect upon the Company`s business, financial condition and results of operations. The Company has not entered into employment agreements with any of its key personnel.

Product Liability Risk; Possible Insufficiency of Insurance. The Company`s business involves the inherent risk of product liability claims. The Company maintains limited product liability insurance at coverage levels which the Company believes to be commercially reasonable and adequate given the Company`s current operations. However, there can be no assurance that such insurance will continue to be available on commercially reasonable terms, or at all, or that such insurance will be adequate to cover liabilities that may arise. Any claims that are brought against the Company could, if successful, have an adverse effect on the Company`s business, financial condition and results of operations.


Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company considered the provision of Financial Reporting Release No. 48 "Disclosure of Accounting Policies for Derivative Financial Instruments and Derivative Commodity Instruments, and Disclosure of Quantitative and Qualitative Information about Market Risk Inherent in Derivative


Financial Instruments, Other Financial Instruments and Derivative Commodity Instruments". The Company had no holdings of derivative financial or commodity instruments at June 30, 2000. The Company is exposed to financial market risks, including changes in interest rates and foreign currency exchange rates. The fair value of the Company`s investment portfolio or related income would not be significantly impacted by either a 100 basis point increase or decrease in interest rates due mainly to the short-term nature of the Company`s investment portfolio. The Company`s fixed rate debt obligations are subject to interest rate risk with minimal impact. An increase in interest rates would not significantly affect the Company`s net loss. Much of the Company`s revenue and all of its capital spending is transacted in U.S. dollars. However, the Company does enter into these transactions in other currencies, primarily certain European currencies. At June 30, 2000, the Company performed sensitivity analyses to assess the potential effect of this risk and concluded that near- term changes in interest rates and

[Kleinstadtaktionär]

Hey,

wie siehts eigentlich im Moment aus, weiß keine was echt aktuelles?
Bisher hat sich ja alles ganz gut angehört, gibt es keine Chanze, daß
dieses Höhrgerät baldmöglichst in den Einsatz kommt.
Mein Depot warte auf Gewinne?

[j-l-picard]

Hallo Klienstadtaktionär,

ich denke im Moment sind die Anleger etwas verunsichert, da mit der Marktzulassung zu schnell zu viel Erwartungen geweckt wurden. Ich denke es muss abgewartet werden, bis die Vermarkutng richtig anläuft. Auch wenn dies noch etwas dauert, sollte man nicht ungeduldig werden. Wenn SMPX erstmal Eínnahmen mit dem Produkt erzielt, werden wir wieder bessere Kurse sehen.

Gruß Picard

[Schwammerl]

Wo bekonmmt man eigentlich regelmäßig neue News zu Symphonic? Waren die letzten Höchstkurse nur auf die Empfehlung von Euro am Sonntag zurückzuführen? Seit ich eingestiegen bin, geht es jedenfalls nur bergab. Ist die Zulassung jetzt perfekt oder bleibt es nur bei einer Empfehlung? Vielleicht kann mir ja jemand aktuele Informationen geben, die mich und mein Depot etwas aufmuntern.
Gruß Schwammerl

[Deerhunter]

@Schwammerl:
Die bislang einzige mir bekannte Quelle für Informationen über Symphonix ist www.hoovers.com
Bedauerlicherweise betreibt Symphonix selbst quasi gar keine PR. Zwar ist dieses "old-economy"-Unternehmen
auch weniger an kursfördernden ad-hoc-news interessiert, als es so manches Internet-Unternehmen vielleicht
ist, aber eine etwas detaillierte Informationspolitik wäre schon wünschenswert.
Zu der Frage, ob der letzte Ausbruch ausschließlich auf die Empfehlung in der Eurams zurückzuführen sei:
Ja. SMPX ist allerdings kaum jemandem bekannt. Daran hat auch die Leserempfehlung nichts geändert.
Allerdings sind dadurch viele Anleger erst auf den Wert aufmerksam geworden. (Deinen Zeilen entnehme
ich, daß es Dir da wohl nicht anders geht oder?) Schön wäre es, wenn die Finanzinformationsdienstleister
auch Informationen wie die Zulassung des neuen Hörgerätes publik machten.
Mit einem Marketingfeldzug für das neue Produkt ist natürlich nicht zu rechnen, aber vielleicht findet es ja
hohe Akzeptanz bei denjenigen, die auf Hörhilfen angewiesen sind (trotz hoher Kosten für den s.g. End-
verbraucher).

Gruß,
Deerhunter

[Küchenfee]

was mich irritiert ist, daß bis jetzt gerade mal 200 stk an der Nsdq über den tresen gegangen sind. Vorallem der Kurs bei 4,34 und ASK 4,31 und trotzdem will keiner ran.

KF

[MacMax]

Hi !

Ich bin mir nicht sicher ob es noch so lange geht (klar bis Kurse von 20 zu sehen sind schon noch etwas) denkt aber daran das ab nächster Woche erst die offizielle Zulassung kommt !
Ich denke das wird SMPX dann schon in Schwung bringen !!!

Jetzt ist auf jedenfall Zeit sich einzudecken wenn es gerade etwas still geworden ist kaufen und wenn alle Jubeln verkaufen ganz einfach

Gruss
MM

[Viva-los-Tioz]

@MacMax
Glaubst Du wirklich noch an 20 €?

[Küchenfee]

gestern über 120 000 Stücke gehandelt.Obwohl zum Schluß noch mal zurückgekommen, bin ich mir sicher, nächste Woche geht es langsam Step by Step gen Norden.
Wenn nicht, dann übernächste Woche ;wir haben doch Zeit oder ????

KF