Insulet Corp. rode strong sales of its insulin pumps last quarter to an 87 percent increase in first-quarter revenues.
But the company also took on a substantial debt increase after agreeing to a $60 million loan in March.
Insulet took its first portion of the loan, about $28 million, on the last day of the quarter and has the right to draw increments of $6.5 million anytime until November 2010. The loan, which carries a 9.75 percent annual interest rate, helped the company beef up its cash reserves. Insulet had $68 million in cash and cash equivalents closing out the quarter, approximately $12 million more than at the end of the same period last year.
It’s cash the company needs to fund operations. Despite the huge jump in sales, Insulet still faced heavy losses in the quarter, posting $19.6 million in red ink on $12.4 million in sales for the three-months ended March 31, compared with $19.8 million in losses on $6.6 million in sales for the 2008 first quarter.
But European approval of the OmniPod by European Union regulators could help boost future sales.