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NEUPATH HEALTH REPORTS FOURTH QUARTER AND YEAR-END 2024 RESULTS

  • Fourth quarter total revenue of $18.9 million, up 12% year-over-year
  • Q4 adjusted EBITDA(1) of $0.9 million, up 18% year-over-year, and our 24th consecutive quarter of positive adjusted EBITDA. Full year adjusted EBITDA up 19% year-over-year
  • Positive cash flows, with significant investments in our facilities to support future growth
  • In Q1 2025 performed the first-ever injection in North America of Arthrosamid® (2.5% iPAAG) at its Mississauga, Ontario clinic
  • In Q1 2025 secured a new Credit Facility with National Bank to support growth initiatives

TORONTO, ONTARIO, March 27, 2025 – NeuPath Health Inc. (TSXV:NPTH), (“NeuPath” or the “Company”), owner and operator of a network of clinics delivering category-leading chronic pain treatment, today announced its financial and operating results for the three months and year ended December 31, 2024. All figures are in Canadian dollars, unless otherwise noted.

“We once again delivered strong organic growth while continuing to invest in our facilities,” said Joe Walewicz, NeuPath’s Chief Executive Officer. “These investments, new procedures such as the recently launched Arthrosamid, and our new Credit Facility will accelerate organic and inorganic growth to better serve patients, with more services, in more communities.”

Financial and Operational Highlights

  • Total revenue was $18.9 million and $72.8 million for the three months and year ended December 31, 2024, up 12% versus the fourth quarter of 2023 and 10% for the year, delivering another record year of revenues;
  • Adjusted EBITDA was $0.9 million and $3.8 million for the three months and year ended December 31, 2024, up 18% over the prior year fourth quarter and 19% year-over-year;
  • For the year ended December 31, 2024, capacity utilization improved to 75%, up from 68% in the prior year;
  • As at December 31, 2024, the Company had $2.9 million in cash and cash equivalents and long-term debt of $5.9 million, of which $2.2 million is interest-bearing;
  • In Q1 2025 performed the first-ever injection of Arthrosamid (2.5% iPAAG) in North America at its Mississauga, Ontario clinic. Arthrosamid is a unique non-biodegradable hydrogel injection developed by Contura International A/S, a biotechnology company based in Denmark. Unlike traditional osteoarthritis injections, Arthrosamid integrates into the synovial tissue of the knee, helping to cushion the joint and reduce pain with a single dose; and
  • In Q1 2025 announced a new $13.5 million Credit Facility with National Bank, including a Term Loan, a Revolving Facility and an Acquisition Line to support the continued growth of the business.

(1)      Non-International Financial Reporting Standard (“IFRS”) and Other Financial Measures defined by the Company below.

Total Revenue

Total revenue is comprised of clinic revenue and non-clinic revenue. Total revenue was $18.9 million for the three months ended December 31, 2024 compared to $16.8 million for the three months ended December 31, 2023. Total revenue was $72.8 million for the year ended December 31, 2024 compared to $66.1 million for the year ended December 31, 2023.

Clinic Revenue

Clinic revenue is generated through the provision of medical services to patients. Clinic revenue was $17.5 million for the three months ended December 31, 2024 compared to $15.3 million for the three months ended December

31, 2023. Clinic revenue was $67.3 million for the year ended December 31, 2024 compared to $61.0 million for the year ended December 31, 2023. The increase in clinic revenue for the year ended December 31, 2024 was primarily due to stronger revenues from fluoroscopy and increased patient volumes from existing medical clinics.

Non-clinic Revenue

Non-clinic revenue was $1.4 million for the three months ended December 31, 2024 compared to $1.5 million for the three months ended December 31, 2023. Non-clinic revenue was $5.5 million for the year ended December 31, 2024 compared to $5.1 million for the year ended December 31, 2023. Non-clinic revenue is earned from physician staffing allocation services where the Company provides physicians for provincial and federal correctional institutions across Canada, and from contract research services provided to pharmaceutical companies and clinical research organizations. This revenue fluctuates depending on the need for physicians in certain institutions and the timing and enrolment of clinical studies that the Company is working on.

Gross margin % was 19.2% for the three months ended December 31, 2024 and December 31, 2023. Gross margin

% was 19.0% for the year ended December 31, 2024 compared to 18.6% for the year ended December 31, 2023. The increase in gross margin was primarily driven by higher revenues from fluoroscopy and increased patient volumes at existing medical clinics compared to the year ended December 31, 2023. (see Non-IFRS Financial Measures – Gross Margin and Gross Margin %).

Adjusted EBITDA was $0.9 million and $3.8 million for the three months and year ended December 31, 2024 compared to $0.8 million and $3.2 million for the three months and year ended December 31, 2023.

Liquidity and Capital Resources

As at December 31, 2024, the Company’s net debt was $3.0 million, compared to $2.9 million as at December 31, 2023. The Company’s net debt as at December 31, 2024 consisted of $2.9 million of cash and cash equivalents and long-term debt of $5.9 million compared to $3.2 million of cash and cash equivalents and long-term debt of

$6.1 million as at December 31, 2023.

For more information see Note 12, Long-Term Debt in the Company’s Consolidated Financial Statements for the three months and year ended December 31, 2024 and 2023.

Non-IFRS Financial and Other Measures

The Company discloses non-IFRS measures (such as EBITDA, adjusted EBITDA, and gross margin) and non- IFRS ratios (such as gross margin %) that do not have standardized meanings prescribed by International Financial Reporting Standards (“IFRS”). The Company believes that shareholders, investment analysts and other readers find such measures helpful in understanding the Company’s financial performance. Non-IFRS financial measures and other measures do not have any standardized meaning prescribed by IFRS and may not have been calculated in the same way as similarly named financial measures presented by other reporting issuers and therefore unlikely to be comparable to similar measures presented by other companies. Furthermore, these non-IFRS measures and other measures should not be considered in isolation or as a substitute for measures of performance or cash flows as prepared in accordance with IFRS. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS.

EBITDA and Adjusted EBITDA

EBITDA refers to net income (loss) determined in accordance with IFRS, before depreciation and amortization, net interest expense (income) and income tax expense (recovery). The Company defines adjusted EBITDA, as EBITDA, excluding stock-based compensation expense, restructuring costs, gain on derecognition of other obligations, fair value adjustments, transaction costs, impairment charges, gain on sale of building, government loans forgiveness, finance income and loss or gain on sale of property, plant and equipment. Management believes EBITDA and adjusted EBITDA are useful supplemental non-GAAP measures to determine the Company’s ability to generate cash available for operations, working capital, capital expenditures, debt repayments, interest expense and income taxes.

The following table provides a reconciliation of net and comprehensive loss to EBITDA and adjusted EBITDA:

Gross Margin and Gross Margin %

Management believes gross margin and gross margin % are important supplemental non-GAAP measures for evaluating operating performance and to allow for operating performance comparability from period-to-period. Gross margin is calculated as total revenue minus cost of medical services (”COMS”). Gross margin % is calculated as gross margin divided by total revenue.

The following table provides a reconciliation of total revenue to gross margin:

For further details on the results, please refer to NeuPath’s Management, Discussion and Analysis and Consolidated Financial Statements for the three months and year ended December 31, 2024, which are available on the Company’s website (www.neupath.com) and under the Company’s profile on SEDAR+ (www.sedarplus.ca).

About NeuPath

NeuPath operates a network of healthcare clinics and related businesses focused on improved access to care and outcomes for patients by leveraging best-in-class treatments and delivering patient-centered multidisciplinary care. We operate a network of medical clinics in Ontario and Alberta that provide comprehensive assessments and rehabilitation services to patients with chronic pain, musculoskeletal/back injuries, sports related injuries and concussions. In addition, NeuPath provides workplace health services and independent medical assessments to employers and disability insurers through a national network of healthcare providers, as well as contract research

services to pharmaceutical and biotechnology companies. NeuPath is focused on enabling each individual to live their best life. For additional information, please visit www.neupath.com.

Forward-Looking Statements

This news release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future including, without limitation, the Company’s expectation of continued operational improvements in 2025 and the execution of the Company’s growth opportunities are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations included in this news release include, among other things, adverse market conditions, risks associated with obtaining and maintaining the necessary governmental permits and licenses related to the business of the Company, increasing competition in the market and other risks generally inherent in the chronic pain, sports medicine, concussion and workplace health services markets. A comprehensive discussion of these and other risks and uncertainties can be found in the Company’s annual information form dated March 26, 2025 filed on SEDAR+ under the Company’s profile at www.sedarplus.ca.

Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions underlying the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to their inherent uncertainty.

For more information, please contact:

Jeff Zygouras
Chief Financial Officer [email protected] (905) 858-1368

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS THE RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Chronic Pain

,

Dr. Kim, NeuPath Centre for Pain & Spine Medical Director, on Chronic Pain

Chronic pain is a complex condition driven by a number of biological, behavioural, psychological, and social factors. At NeuPath, we aim to acknowledge the multifaceted experience of living with Chronic pain by developing patient centered tailored treatment plans. A common first visit will include a thorough assessment which includes reviewing your pain history, previous treatments, and current medications. The initial appointment is extremely helpful in developing a customized treatment plan.

I’ve been treating Chronic Pain for many years and some of the most common interventions that I recommend are:

  • Address pain tolerance and coping mechanisms, explore maladaptive behavioural patterns
  • Discuss the difference between hurt vs harm
  • Focus treatment on anatomic areas of pain, using different modalities: medications and injections where appropriate
  • Work to ensure improvement and/or stability in symptom management and functional goals

We understand that chronic pain is a complex medical problem that can have a significant effect on your physical, emotional and spiritual well- being. The main goal of a successful pain management is reduced pain but, most importantly, a return to better function and quality of life.

Cervical Radiofrequency Ablation (RFA)

,

After your Cervical RFA procedure, you will be monitored for approximately 30 minutes. The clinic will give you appropriate directions to follow for care following the procedure.

We caution against driving after an RFA procedure.

Post-procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation and can last 2–4 weeks. The full benefits of pain relief take usually 6-12 weeks.

Nerves will regenerate after the RFA procedure. However the time it takes for them to regenerate varies from 8–24 months. Your typical pain may or may not return after this nerve regeneration.

If your pain does return another RFA can be done.

Do I have Cervical Facet Joint Pain?

If you have pain for greater than 2 months in the head, neck, shoulder, or upper back area you may have facet joint pain.

Tests such as X-rays or MRIs do not always show if the facet is the reason for your pain. The best way to test if you have this pain is to block the pain signal from the medial branch nerve.

A Cervical RFA disrupts the function of the cervical medial branch nerve temporarily. The medial branch nerve is then no longer able to transmit pain signals from the affected facet joint to the brain.

RFA Procedure

A thin needle is inserted near the facet joint under fluoroscopy (a type of X-ray). Fluoroscopy is used to position the needle accurately and safely. The nerve will be stimulated by the Physician to assess if the needle is in the proper position. This can cause some of your symptoms to be reproduced and/or your arm or hand to twitch.

The area will be numbed with an anesthetic medication with the correct needle position. The Physician will use radiofrequency energy to disrupt the medial branch nerve signal.

What is a Cervical RFA?

This outpatient procedure is used to help with treating headaches, neck, shoulder, and upper back pain.

What are Cervical Facet Joints?

Facet joints are found on either side of the spine. Each of these joints is about the size of a thumbnail. There are 7 vertebrae in the cervical spine that are connected by facet joints.

Facet joints connect vertebrae to one another along with guiding the spine when moving.

Medial branch nerves are located near facet joints. They communicate pain from facet joints to the brain. Therefore the nerves tell the brain when the facet joint has been irritated.

Injury to a facet joint typically involves damage to cartilage inside the joint and the connecting ligaments surrounding the joint.

Pain from an injured cervical joint may range from mild muscle tension to more severe pain. This pain can radiate into different areas, often the shoulder blade area, depending on which facet joint is irritated.

Sacroiliac Joint Lateral Nerve Block

,

After your SI Joint Intra-articular Injection, you will be monitored for approximately 15-30 minutes. The clinic will give you appropriate directions to follow for care following the procedure.

Post-procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation. You may also notice some numbness and tingling in the leg and foot for a maximum of 4-6 hours.

There should be pain relief immediately lasting 4-6 hours. The corticosteroid takes about 1-week post-injection for it to take optimal effects. Pain relief lasts anywhere from a few weeks to several months, depending on the ultimate cause of your SI joint pain.

Do I have SI Joint Pain?

If you have pain for greater than 2 months in the lower back to buttock and/or leg. Tests such as X-rays or MRIs do not always show if the SI joint is the reason for your pain. The best way to test if you have this pain is to block the pain signals from the lateral nerve.

A SI joint lateral Block disrupts the function of the SI joint lateral branch nerve temporarily. The lateral nerve is then no longer able to transmit pain signals from the affected facet joint to the brain.

SI Joint Lateral Block Procedure

A thin needle is inserted directly into the SI joint under fluoroscopy (a type of X-ray). Fluoroscopy is used to position the needle accurately and safely. A small amount of dye is used by the Physician to assess if the needle is in the proper position.

This injected dye can cause some discomfort. The area will be numbed with an anesthetic medication with the correct needle position.

What is a SI Joint Nerve Block?

This outpatient procedure is used to help with diagnosing pain from the low back to the buttock, and sometimes into the leg.

What are SI Joints?

The SI joint is what attaches the spine to the hip. It is made up of the Sacrum (part of the spine) and the Ilium (part of the hip).

There are many ligaments that help to strengthen the SI joint.

Lateral nerves extend from the Sacrum and communicate with the SI joint. Therefore the nerves tell the brain when the SI joint has been injured.

Sacroiliac Joint Radiofrequency Ablation (RFA)

,

After your SI Joint RFA procedure, you will be monitored for approximately 30 minutes. The clinic will give you appropriate instructions to follow for care after the procedure.

We caution against driving after an RFA procedure.

Post-procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation and can last 2–4 weeks. The full benefits of pain relief take usually 6–12 weeks.

Nerves will regenerate after the RFA procedure. However the time it takes for them to regenerate varies from 8–24 months. Your typical pain may or may not return after this nerve regeneration. If your pain does return another RFA can be done.

Do I have SI Joint Pain?

If you have pain for greater than 2 months in the lower back, buttock, and/or leg area you may have SI joint pain.

Tests such as X-rays or MRIs do not always show if the SI joint is the reason for your pain. The best way to test if you have this pain is to block the pain signal from the lateral nerve.

A SI joint RFA disrupts the function of the lateral nerve. The lateral nerve is then no longer able to transmit pain signals from the affected SI joint.

RFA Procedure

A thin needle is inserted near the SI joint under fluoroscopy (a type of X-ray). Fluoroscopy is used to position the needle.

The area will be numbed with an anesthetic medication with the correct needle position. The Physician will use radiofrequency energy to disrupt the lateral nerve signal.

What is a SI Joint RFA?

This outpatient procedure is used to help with diagnosing and/or treating pain from the low back to the buttock, and sometimes into the leg.

What are SI Joints?

The SI joint is what attaches the spine to the hip. It is made up of the Sacrum (part of the spine) and the Ilium (part of the hip).

There are many ligaments that help to strengthen the SI joint.

Lateral nerves extend from the Sacrum and communicate with the SI joint. Therefore the nerves tell the brain when the SI joint has been injured.

Sacroiliac Joint Intra-articular Injection

,

After your SI Joint Intra-articular Injection, you will be monitored for approximately 15-30 minutes. The clinic will give you appropriate directions to follow for care following the procedure.

Post-procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation. You may also notice some numbness and tingling in the leg and foot for a maximum of 4-6 hours.

There should be pain relief immediately lasting 4-6 hours. The corticosteroid takes about 1-week post-injection for it to take optimal effects. Pain relief lasts anywhere from a few weeks to several months, depending on the ultimate cause of your SI joint pain.

Do I have SI Joint Pain?

If you have pain for greater than 2 months in the lower back, buttock, and/or leg area you may have SI joint pain.

Tests such as X-rays or MRIs do not always show if the SI joint is the reason for your pain. The best way to test if you have this pain is to block the pain signal from the lateral nerve.

SI Joint Intra-articular Injection

A thin needle is inserted directly into the SI joint under fluoroscopy (a type of X-ray). Fluoroscopy is used to position the needle accurately and safely. A small amount of dye is used by the Physician to assess if the needle is in the proper position. This injected dye can cause some discomfort.

With the correct needle position, the joint is then injected with a combination of a corticosteroid (anti-inflammatory) and an anesthetic into the irritated SI joint.

What is a SI Joint Intra-articular Injection?

This outpatient procedure is used to help with diagnosing and/or treating pain from the low back to the buttock, and sometimes into the leg.

What are SI Joints?

The SI joint is what attaches the spine to the hip. It is made up of the Sacrum (part of the spine) and the Ilium (part of the hip).

There are many ligaments that help to strengthen the SI joint.

Lateral nerves extend from the Sacrum and communicate with the SI joint. Therefore the nerves tell the brain when the SI joint has been injured.

Cervical Medial Branch Block

,

After your Cervical Medial Branch Block procedure you will be monitored for approximately 15 – 30 minutes. The clinic will give you appropriate directions to follow as well as complete a pain diary. This pain diary is very important as it will guide the Physician treatment plan for you.

We caution against driving after any neck procedures.

Pain relief will last for approximately 4-6 hours, and then the anesthetic wears off.

Short term pain relief is considered a positive test. The Physician will then determine the next step in your treatment plan.Post procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation.

Do I have Cervical Facet Joint Pain?

If you have pain for greater than 2 months in the head, neck, shoulder or upper back area you may have facet joint pain.

Tests such as X-rays or MRIs do not always show if the facet is the reason for your pain. The best way to test if you have this pain is to block the pain signal from the medial branch nerve.

A Cervical Medial Branch Block disrupts the function of the cervical medial branch nerve temporarily. The medial branch nerve is then no longer able to transmit pain signals from the affected facet joint to the brain.

Medial Branch Block Procedure

A thin needle is inserted near the facet joint under fluoroscopy (a type of x-ray). Fluoroscopy is used to position the needle accurately and safely. A small amount of dye is used by the Physician to assess if the needle is in the proper position. This injected dye can cause some discomfort.

With the correct needle position the area will be numbed with anesthetic medications.

What is a Cervical Medial Branch Block(MBB)?

This outpatient procedure is used to help with diagnosing, neck, shoulder and upper back pain.

What are Cervical Facet Joints?

Facet joints are found on either side of the spine. Each of these joints is about the size of a thumbnail. There are 7 vertebrae in the cervical spine that are connected by facet joints. Facet joints connect vertebrae to one another along with guiding the spine when moving.

Medial branch nerves are located near facet joints. They communicate pain from facet joints to the brain. Therefore the nerves tell the brain when the facet joint has been irritated.

Injury to a facet joint typically involves damage to cartilage inside the joint and the connecting ligaments surrounding the joint.

Pain from an injured cervical joint may range from mild muscle tension to more severe pain. This pain can radiate into different areas, often shoulder blade area, depending on which facet joint is irritated.

Cervical Facet Joint Injection

,

How Long Should the Pain Relief Last?

After your Cervical Facet Joint Injection you will be monitored for approximately 15 – 30 minutes. The clinic will give you appropriate directions to follow for care following the procedure.

We caution against driving after any neck procedure.

Post procedure soreness may be experienced. Typically this soreness is caused by muscle and nerve irritation. You may also notice some numbness and tingling into the neck and arm for a maximum of 4-6 hours.

There should be pain relief immediately lasting 4-6 hours. The corticosteroid takes about 1 week post injection for it to take optimal effects. Pain relief lasts anywhere from a few weeks to several months, depending on the ultimate cause of your facet joint pain.

Do I have Cervical Facet Joint Pain?

If you have pain in the head, neck, shoulder or upper back area when turning your head for greater than 2 months you may have facet joint pain.

Tests such as X-rays or MRIs do not always show if the facet is the reason for your pain. The best way to test if you have this pain is to block the pain signal from the medial branch nerves which sends the nerve signals from the facet joints to the brain.

Injection Procedure

A thin needle is inserted into the cervical facet joint under fluoroscopy (a type of x-ray). Fluoroscopy is used to position the needle accurately and safely. A small amount of dye is injected by the Physician in order to assess if the needle is in the proper position. This can cause some of your symptoms to be reproduced.
With the correct needle position, the joint is then injected with a combination of a corticosteroid (anti-inflammatory) and a anesthetic into the irritated facet joint.

What is a Cervical Facet Joint Injection?

This outpatient procedure is used to help with diagnosing and/or treating head, neck, shoulder and upper back pain.

What are Cervical Facet Joints?

Facet joints are found on either side of the spine. Each of these joints is about the size of a thumbnail. There are 7 cervical vertebrae that are connected by facet joints. Facet joints connect vertebrae to one another along with guiding the spine when moving. Injury to a facet joint typically involves damage to cartilage inside the joint and connecting ligaments surrounding the joint.
Pain from an injured cervical facet joint may range from mild muscle tension to more severe pain. This pain can radiate into different areas, often shoulder blade area, depending on which facet joint is irritated.

Chronic Shoulder Pain

,

Dr. Kim, NeuPath Centre for Pain & Spine Medical Director, on Chronic Shoulder Pain

At NeuPath, our goal is to provide a comprehensive Chronic Pain assessment and a whole-patient focused treatment plan. I’ve treated Chronic Shoulder Pain for many years at NeuPath and many of my patients benefit from a treatment plan that includes the following interventions depending on the type of disorder:

  • General discussions on maintaining mobility and function
  • Medications focussed on reducing pain, inflammation and spasms
  • Injection-based treatments that utilize local anesthetics,, steroids and viscosupplementation by targeting the rotator cuff and the shoulder joint.

Progress amongst patients will greatly vary but after a few treatments, I hope to see a wider range of motion in the shoulder which can look very different from patient to patient. Again, patient outcomes will vary based on the individual but the best outcomes happen when the individual also addresses psychological factors, diet, and activity. At NeuPath, we work closely with our allied health partners to help our patients in their physical treatment plan.

Osteoarthritis

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Dr. Kim, NeuPath Centre for Pain & Spine Medical Director, on Osteoarthritis 

At NeuPath, our goal is to provide a comprehensive Chronic Pain assessment and a whole-patient focused treatment plan. I’ve treated Osteoarthritis for many years at NeuPath and most of my patients benefit from a treatment plan that includes the following interventions:

• Promotion of weight loss treatments to reduce the impact of gravity on weight-bearing function

• Medications, both systemic and topical

• Local injection-based treatment that targets both peri-articular structures, superficial nerves and the intra-articular joint space, using a variety of injectables including local anesthetic, steroids, and hyaluronic acid.

Patient outcomes will vary based on the individual but the best outcomes happen when the individual also addresses psychological factors, diet, and activity. At NeuPath, we work closely with our allied health partners to help our patients in their physical treatment plan.

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