What changed in this filing

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Item 1. Business

2021-09-21 compared with 2020-09-08 · 92 added, 92 removed, 342 unchanged (35% of the section changed)

Astrotech Corporation (Nasdaq:

ASTC) (“Astrotech,” the “Company,” “we,” “us,” or “our”), a Delaware corporation organized in 1984, is a science and technology development and commercialization company that launches, manages, and builds scalable companies based on innovative technology in order to maximize shareholder value.

The Company’s efforts are focused on commercializing its platform mass spectrometry technology through its wholly-owned subsidiaries:

Astrotech Technology, Inc.

ASTC) (“Astrotech,” the “Company,” “we,” “us,” or “our”), a Delaware corporation organized in 1984, is a mass spectrometry company that launches, manages, and commercializes scalable companies based on its innovative core technology through its wholly-owned subsidiaries:

Astrotech Technologies, Inc.

(“ATI”) owns and licenses the intellectual property related to the Astrotech Mass Spectrometer Technology™ (the “AMS Technology”) .

1 st Detect Corporation (“1 st Detect”) is a manufacturer of explosives and narcotics trace detectors developed for use at airports, secured facilities, and borders worldwide.

1 st Detect holds an exclusive AMS Technology license from ATI for airport security applications.

(“AgLAB”) is developing a series of mass spectrometers for use in the agriculture market for process control and the detection of trace amounts of solvents and pesticides.

1 st Detect Corporation (“1 st Detect”) is a manufacturer of explosives and narcotics trace detectors developed for use at airports, cargo and other secured facilities, and borders worldwide.

1 st Detect holds an exclusive AMS Technology license from ATI for air passenger and cargo security applications.

(“AgLAB”) is developing a series of mass spectrometers for use in the hemp and cannabis market with initial focus on optimizing yields in the extraction and distillation process.

AgLAB holds an exclusive AMS Technology license from ATI for agriculture applications.

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Business Developments

On September 20, 2019, the Company announced a new subsidiary, AgLAB Inc., which is developing the AgLAB-1000™ series of mass spectrometers to be used in process control and in the detection of trace amounts of solvents and pesticides during the extraction and distillation of agricultural products.

The mass spectrometry technology that is currently owned by ATI is ideally suited for these applications and the “Agriculture” field of use has now been licensed to AgLAB.

With the passing of the U.S.

Farm Bill, (H.R.

2, 115th) and the increasing number of U.S.

states and countries that are legalizing hemp and cannabis, AgLAB has been working with industry farmers, equipment manufacturers, and laboratories in the development of its AgLAB-1000 series of products to detect trace levels (ppb/ppt) of cannabinoids, terpenes, solvents, and pesticides in the manufacturing of hemp and cannabis products.

On November 14, 2019, the Company announced that 1 st Detect was selected by the U.S.

Department of Homeland Security (“DHS”) Transportation Security Administration (“TSA”) to conduct live screening with the TRACER 1000™ at Miami International Airport.

The invitation was in response to the TSA Innovation Task Force (“ITF”) Innovative Demonstrations for Enterprise Advancement Broad Agency Announcement.

The ITF works in partnership with airports, airlines, and industry partners to foster innovation in aviation security.

It was created to help find and deploy the very best technology for increasing security and improving the passenger experience.

The ITF enables accelerated productization of innovative new technologies by deploying products in real-world environments and allowing for the collection of valuable operational field data and feedback.

On November 22, 2019, the Company announced that 1 st Detect had signed a contract with a global shipping and logistics company and is already fulfilling purchase orders.

Under the terms of the contract, the TRACER 1000™ has been added to the shipping and logistics company’s approved vendor list and is now available for corporate-wide purchases on pre-negotiated terms.

On February 13, 2020, the Company entered into a private placement transaction with Mr.

Pickens III, the Company’s Chairman of the Board and Chief Executive Officer, for the issuance and sale of a secured promissory note to Mr.

Pickens with a principal amount of $1.0 million.

On March 25, 2020, the Company launched its new subsidiary, BreathTech.

BreathTech is developing the BreathTest-1000, a breath analysis tool to screen for VOC metabolites found in a person’s breath that could indicate they may have an infection, including COVID-19 or pneumonia.

On March 25, 2020, the Company entered into a securities purchase agreement with certain purchasers named therein, pursuant to which the Company agreed to issue and sell, in a registered direct offering, 354,000 shares of the Company’s common stock, par value $0.001 per share, at an offering price of $ 5.00 per share, resulting in net proceeds of approximately $1.6 million.

On March 27, 2020, the Company entered into a second securities purchase agreement with certain purchasers named therein, pursuant to which the Company agreed to issue and sell, in a registered direct offering, 873,335 shares of the Company’s common stock, par value $0.001 per share, at an offering price of $ 3.75 per share, resulting in net proceeds of approximately $2.9 million.

On April 14, 2020, the Company entered into a $542 thousand Paycheck Protection Program Promissory Note and Agreement (the “PPP Promissory Note”) from a commercial bank under the Coronavirus Aid, Relief, and Economic Security Act administered by the U.S.

Small Business Administration.

On August 24, 2020, the Company and Mr.

Pickens agreed to extend the maturity date of both secured promissory notes held by Mr.

Pickens to September 5, 2021.

As of the date of this filing, we have delivered TRACER 1000 units to eight countries across Europe and Asia.

During fiscal year 2021, we raised net proceeds of approximately $67.6 million in a series of equity offerings.

These offerings included a public offering and a registered direct offering for aggregate net proceeds of $21.8 million in October 2020, sales of shares of our common stock through an at-the-market agreement and a second registered direct offering for aggregate net proceeds of $11.7 million in February 2021, and an underwritten, firm-commitment public offering for net proceeds of $34.0 million in April 2021.

On September 9, 2020, we announced that 1 st Detect’s TRACER 1000™ passed the U.S.

Transportation Security Administration’s (“TSA”) Air Cargo Screening Technology Qualification Test’s (“ACSQT”) non-detection testing.

On October 20, 2020, we announced that BreathTech had signed a joint development agreement (the “JDA”) with the Cleveland Clinic Foundation (“Cleveland Clinic”) to explore leveraging BreathTech’s BreathTest-1000™ mass spectrometer to rapidly screen for COVID-19 or related indicators.

The goal of the JDA is to develop a non-invasive device that will use breath samples to identify COVID-19 strains, with the potential to provide a low-cost, self-service screening option that could be deployed on a large-scale.

On March 30, 2021, we announced that ATI entered into an agreement with Sanmina Corporation (“Sanmina”) to manufacture its mass spectrometry products.

Sanmina is a leading integrated manufacturing solutions provider for the Electronics Manufacturing Services market.

As part of the relationship, Sanmina will procure and inspect components, parts, and raw materials and manufacture, assemble, test, inspect, configure, store, and ship the products for any of the licensees of ATI.

On March 31, 2021, BreathTech signed an Investigator-Initiated Study Agreement (the “ILSA”) with Cleveland Clinic.

Pursuant to the ILSA, Cleveland Clinic will use BreathTech’s BreathTest-1000 to compare exhaled breath from individuals who have tested positive on a COVID-19 polymerase chain reaction (“PCR”) test with that from subjects who have had a negative COVID-19 PCR test.

The goal of the pilot study will be to analyze different volatile organic compounds from the breath to evaluate the correlation with different disease states.

On April 19, 2021, we received full forgiveness of our Paycheck Protection Program Promissory Note in the amount of $542 thousand (the “PPP Promissory Note”) from the U.S.

Small Business Administration (the “SBA”).

On August 3, 2021, AgLAB announced that it has hired Joe Levinthal, a hemp and cannabis industry veteran and an expert in mass spectrometry, as its Chief Science Officer, to help lead AgLAB’s product development team.

Levinthal brings an extensive background in applying highly complex scientific instrumentation to develop products derived from hemp and cannabis, and he has worked with some of the leading companies in the industry.

On August 25, 2021, 1 st Detect announced that it has secured an important landmark purchase order for the TRACER 1000, representing the first units to be deployed at an airport security checkpoint.

As of the date of this filing, the TRACER 1000 is deployed in 14 locations across nine countries throughout Europe and Asia.

Our Business Units

Astrotech Technology, Inc.

Astrotech Technologies, Inc.

ATI owns and licenses the AMS Technology, the platform mass spectrometry technology originally developed by 1st Detect.

The intellectual property includes 37 granted patents and five additional patents in process along with extensive trade secrets.

Long recognized as the gold standard in chemical detection, mass spectrometry has historically been too costly, bulky, and cumbersome.

In contrast, the AMS Technology has been designed to be inexpensive, small, and easy to use.

Unlike other technologies, the AMS Technology works under ultra-high vacuum, which eliminates competing molecules, yielding higher resolution and fewer false alarms.

The intellectual property includes 28 granted patents and two additional patents in process along with extensive trade secrets.

With a number of diverse market opportunities for the core technology, ATI is structured to license the intellectual property for different fields of use.

ATI currently licenses the AMS Technology to three wholly-owned subsidiaries of Astrotech, including to 1 st Detect for use in the security and detection market, to AgLAB for use in the agriculture market, and to BreathTech for use in breath analysis.

ATI currently licenses the AMS Technology to three wholly-owned subsidiaries of Astrotech on an exclusive basis, including to 1st Detect for use in the security and detection market, to AgLAB for use in the agriculture market, and to BreathTech for use in breath analysis.

1 st Detect Corporation

1 st Detect, a licensee of ATI for the security and detection market, has developed the TRACER 1000™, the world’s first mass spectrometer (“MS”) based explosives trace detector (“ETD”) certified by the European Civil Aviation Conference (“ECAC”), designed to replace the ETDs used at airports, cargo facilities, secured facilities, and borders worldwide.

We believe that ETD customers are unsatisfied with the currently deployed ETD technology, which is driven by ion mobility spectrometry (“IMS”).

We believe that IMS-based ETDs are fraught with false positives, as they often misidentify personal care products and other common household chemicals as explosives, causing unnecessary delays, frustration, and significant wasted security resources.

1 st Detect, a licensee of ATI for the security and detection market, has developed the TRACER 1000, the world’s first mass spectrometer (“MS”) based explosives trace detector (“ETD”) certified by the European Civil Aviation Conference (“ECAC”), designed to replace the ETDs used at airports, cargo and other secured facilities, and borders worldwide.

The Company believes that ETD customers are unsatisfied with the currently deployed ETD technology, which is driven by ion mobility spectrometry (“IMS”).

The Company believes that IMS-based ETDs are fraught with false positives, as they often misidentify personal care products and other common household chemicals as explosives, causing facility shutdowns, unnecessary delays, frustration, and significant wasted security resources.

In addition, there are hundreds of different types of explosives, but IMS-based ETDs have a very limited threat detection library reserved only for those several explosives of largest concern.

Adding additional compounds to the detection library of an IMS-based ETD fundamentally reduces the instrument’s performance, further increasing the likelihood of false alarms.

In contrast, adding additional compounds does not degrade the TRACER 1000’s detection capabilities, as it has a virtually unlimited and easily expandable threat library.

With terrorist threats becoming more numerous, sophisticated, and lethal, security professionals have been looking for better instrumentation, and specifically for mass spectrometry, to address the evolving threats, but mass spectrometry has long been too expensive, too cumbersome, and not practical for security applications until the launch of the TRACER 1000.

In contrast, adding additional compounds does not degrade the TRACER 1000’s detection capabilities, as it has a virtually unlimited and expandable threat library.

In order to sell the TRACER 1000 to airport and cargo security customers in the European Union, ECAC certification is required.

Certain other countries also accept ECAC certification.

After receiving ECAC certification for the TRACER 1000 on February 21, 2019, we are now marketing to and taking orders from airports and cargo facilities outside of the U.S.

We received ECAC certification for the TRACER 1000 on February 21, 2019.

We are now taking orders from airports and cargo facilities outside of the U.S.

that accept ECAC certification.

On June 26, 2019, the Company announced the official launch of the TRACER 1000, and on November 22, 2019, we announced our first commercial sale of TRACER 1000 uni ts to a global shipping and logistics company.

In the United States, we are working with both TSA and TSA Air Cargo towards certification.

On March 27, 2018, we announced that the TRACER 1000 was accepted into TSA’s Air Cargo Screening Technology Qualification Test (“ACSQT”) and, on April 4, 2018, we announced that the TRACER 1000 was beginning testing with TSA for passenger screening at airports.

On November 14, 2019, we announced that the TRACER 1000 had been selected by the TSA’s ITF to conduct live screening at Miami International Airport.

With similar protocols as ECAC testing, we have received valuable feedback from all programs.

Following ECAC certification and the Company's early traction within the cargo market, testing for both passenger checkpoint and cargo security continued with the TSA, but emphasis was placed on obtaining cargo security approval.

In the United States, the Company is working with the TSA towards air cargo certification.

On March 27, 2018, the Company announced that the TRACER 1000 was accepted into TSA’s ACSQT and, on April 4, 2018, the Company announced that the TRACER 1000 was beginning testing with TSA for passenger screening at airports.

On November 14, 2019, the Company announced that the TRACER 1000 had been selected by the TSA’s Innovation Task Force to conduct live checkpoint screening at Miami International Airport.

With similar protocols as ECAC testing, the Company has received valuable feedback from all programs.

Following ECAC certification and the Company's early traction within the cargo market, testing for cargo security continued with the TSA.

With the COVID-19 pandemic, all testing within the TSA was put on hold;

However, cargo non-detection testing resumed this summer and cargo detection testing is expected to resume this fall.

Given the deterioration in air traffic caused by the pandemic, TSA certification testing for passenger checkpoint security has been put on indefinite hold.

AgLAB is a licensee of ATI and has developed the AgLAB-1000™ series of mass spectrometers for use in the agriculture industry for process control and in the detection of trace levels of solvents and pesticides.

The AgLAB product line is a derivative of the Company’s core AMS Technology.

however, cargo testing resumed during the summer of 2020, and the Company subsequently announced on September 9, 2020 that the TRACER 1000 passed the non-detection testing portion of the TSA’s ACSQT.

TSA cargo detection testing is ongoing and is the next and final

step to be listed on the Air Cargo Screening Technology List (“ACSTL”) as an “approved” device.

If approved, the TRACER 1000 will be approved for cargo sales in the United States .

Finally, on October 28, 2020, the Company announced that it had surpassed $1.0 million in purchase orders for the TRACER 1000 and an additional $1.0 million in future service and support commitments, also announcing DHL (Deutsche Post AG) as its largest flagship customer.

AgLAB, an exclusive licensee of ATI for the agriculture market, has developed the AgLAB-1000™ series of mass spectrometers for use in the hemp and cannabis market with initial focus on optimizing yields in the extraction and distillation process.

The AgLAB product line is a derivative of our core AMS Technology.

The AMS Technology provides a significant competitive advantage due to its small size, rugged design, quick analysis, ease of use, and affordability.

These attributes are valuable for agriculture applications in both processing facilities and in the field.

BreathTech Corporation

Development of the BreathTest-1000 follows the Company’s positive results in pre-clinical trials for the BreathDetect-1000™, a rapid self-serve breathalyzer that detects bacterial infections in the respiratory tract, including pneumonia.

While vaccines have been deployed to prevent the transmission of COVID-19, only a small fraction of the world has been vaccinated and new variants continue to pose a significant and evolving threat.

New tools to aid in the battle against COVID-19 remain of the utmost importance to help defeat the disease, and BreathTech, in conjunction with the Cleveland Clinic, are at the forefront of developing a quick and easy device to help prevent the further spread of the disease.

Development of the BreathTest-1000 follows our results in pre-clinical trials for the BreathDetect-1000™, a rapid self-serve breathalyzer that was designed to detect bacterial infections in the respiratory tract, including pneumonia.

The pre-clinical trials were conducted in collaboration with UT Health San Antonio in 2017.

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We are subject to risks and uncertainties as a result of the COVID-19 pandemic.

The extent of the impact of the COVID-19 pandemic on our business is highly uncertain and difficult to predict, as the responses that we, other businesses, and governments are taking continue to evolve.

Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that it could cause a prolonged global economic recession.

The extent of the impact of the COVID-19 pandemic on our business is uncertain and difficult to predict, as the disease and the responses that we, other businesses, and governments are taking continue to evolve.

Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it remains possible that it could cause a prolonged global economic recession.

Policymakers around the globe have responded with fiscal policy actions to support the economy as a whole.

The magnitude and overall effectiveness of these actions remain uncertain.

The magnitude and overall effectiveness of these actions have been somewhat positive, but continuing actions remain uncertain and pose some degree of risk.

To date, we have seen delays with respect to the TSA certification process and parts of our supply chain as a result of COVID-19.

In addition, operational fees throughout Europe largely come from airline ticket fees, and with a reduction in air travel caused by the pandemic, we are seeing a reduction in near-term demand for ETDs at checkpoints.

In addition, although passenger demand for air travel has recently rebounded to a certain extent, the overall recovery of the airline industry and ancillary services remains highly uncertain and is dependent upon, among other things, the number of cases declining around the globe, public health impacts of new COVID-19 variants, the continued administration of the vaccine to unvaccinated populations, and the duration of immunity granted by the current vaccines.

It is possible that the continued spread of COVID-19 could cause further disruption in our supply chain;

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Business Strategy

1 st Detect Corporation

There are more than 30,000 IMS instruments deployed in the field today, with many nearing their end of life.

As the current generation of IMS technology is replaced, we are working to position the Company as the next-generation solution for the ETD market with the introduction of the world’s first ETD driven by a mass spectrometer.

With mass spectrometry being the gold standard of chemical detection, an MS-ETD significantly improves detection capabilities, dramatically reduces the number of false positives and the associated costs, and allows for a much more expansive library of compounds of interest, yielding an instrument that we believe is far superior to the currently deployed IMS instruments, at a similar price point and a lower operating cost.

With mass spectrometry being the gold standard of chemical detection, an MS-ETD significantly improves detection capabilities, dramatically reduces the number of false positives, decreases delays and the associated costs, and allows for a much more expansive library of compounds of interest, yielding an instrument that we believe is far superior to the currently deployed IMS instruments, at a similar price point and a lower operating cost.

Initial interest for the AgLAB-1000 series has come from the hemp and cannabis industry.

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The BreathTest-1000 product that is currently under development is being designed to provide an inexpensive, non-invasive, and self-serve screening device for COVID-19 and associated lung diseases that can offer results on-site in a very short period of time, which we believe could be as little as approximately 60 seconds.

We believe there is a strong market need for a quick, frequent or daily, lung disease test for use in high density and critical locations.

We believe there remains a strong market need for a quick, frequent or daily, lung disease test for use in high density and critical locations, especially with additional variants of COVID-19 continuing to pose new threats.

Currently available tests either take too long or are invasive and painful.

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Products and Services

1 st Detect Corporation

We believe 1 st Detect’s TRACER 1000 significantly outperforms currently deployed competitive trace detection solutions.

The TRACER 1000 was launched in the summer of 2019 and it has consistently outperformed IMS-ETDs in a number of side-by-side comparisons during field trials, specifically related to false alarm rate, probability of detection, and unit up-time.

Initial interest has come from the cargo security industry, as we announced our first commercial sales to a global shipping and logistics company in November 2019.

The TRACER 1000 has consistently outperformed IMS-ETDs in a number of side-by-side comparisons during field trials, specifically related to false alarm rate, probability of detection, and unit up-time.

Our initial sales have come from the cargo security industry where false alarms can cause expensive delays and facility shut downs as the false alarms are cleared, preventing the mission critical continuous flow of time sensitive packages.

Leveraging the platform AMS Technology, AgLAB is currently designing its product line to serve applications in the hemp and cannabis markets.

AgLAB has launched the AgLAB-1000-D2 that is designed to increase consistency, potency, and productivity during the extraction and distillation processes.

AgLAB has launched the AgLAB-1000-D2 that is designed to optimize yield during the extraction and distillation processes.

BreathTech Corporation

The BreathTest-1000 is being developed to provide an inexpensive, non-invasive, and self-serve screening device for COVID-19 and associated lung diseases.

Leveraging work that was previously completed using breath samples to analyze lung diseases, we have determined that the AMS Technology platform can be used to detect VOC metabolites found in a person’s breath that could indicate they may have an infection, including COVID-19 or pneumonia, using a disposable collection tube and reporting results in what we believe could be as little as approximately 60 seconds.

The BreathTest-1000 is being developed, in conjunction with the Cleveland Clinic, to provide an inexpensive, non-invasive, and self-serve screening device for COVID-19 and associated lung diseases.

The BreathTest-1000 is being designed to detect VOC metabolites in a person’s breath that could indicate they may have an infection, including COVID-19 or pneumonia, using a disposable collection tube.

Results of the test will be reported in what we believe could be as little as approximately 60 seconds.

Customers, Sales, and Marketing

1 st Detect Corporation

Marketing efforts at 1 st Detect are currently focused on foreign airports and commercial companies in aviation and cargo security.

The Company is uses both direct sales and channel sales through distributors.

During fiscal year 2020, we conducted business in seven countries.

While we have had some degree of success with direct sales, much of the pipeline has seen delays due to reduced near-term demand from airports caused by the COVID-19 pandemic.

The Company has launched the AgLAB-1000-D2 for the hemp oil processing market and plans to develop other future products for the hemp and cannabis market.

The Company uses only direct sales at this time.

We are in discussions with various channel partners, largely companies with existing distribution channels in the hemp and cannabis market, that will help sell our products to target customers.

We employ both direct sales and channel sales through distributors.

We now have units deployed in 14 locations in nine countries.

While we have had some degree of success with direct sales, much of the pipeline has seen delays caused by the COVID-19 pandemic.

Further, the worldwide microchip shortage has caused delays in sales and manufacturing, as certain components remain limited or on backorder.

Currently, AgLAB uses only direct sales.

We do plan to engage with various channel partners, largely companies with existing distribution channels in the hemp and cannabis market, to help sell our products to target customers.

BreathTech Corporation

Marketing efforts are currently focused on organizations that are significantly impacted by COVID-19.

The goal is to have a qualified list of prospective customers in greatest need of the Company’s solution as we get closer to completing the development of and application for regulatory approval for the BreathTest-1000.

The goal is to have a qualified list of prospective customers in greatest need of our solution as we get closer to completing the development of and application for regulatory approval for the BreathTest-1000.

1 st Detect Corporation

Competition for the TRACER 1000 comes primarily from IMS-based ETDs.

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• Addition of new compounds may require hardware changes

Causes delays at security/inspection checkpoints

• Causes delays or shutdowns at security facilities/inspection checkpoints

• Low price chemical detector

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• Instantaneous library updates

Improves throughput at checkpoints

• Improves throughput at security facilities and checkpoints

• Competitive price to IMS

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We believe the AgLAB-1000-D2 is the only solution on the market that can provide crucially needed data collected during the extraction and distillation process to optimize the equipment settings to maximize potency and weight yields.

To the best of our knowledge, all other competition is too slow and requires a full laboratory analysis, which takes several days.

believe that any customer s using the A g LAB-1000 -D2 will be able to generate higher quality products with an increased yield, improving their revenue and thus justifying their investment in the instrument.

We believe that

any customer s using the A g LAB-1000 -D2 will be able to generate higher quality products with an increased yield, improving their revenue and thus justifying their investment in the instrument.

BreathTech Corporation

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This product is not expected to compete with the currently available molecular tests like RT-PCR but is intended to only be a screening device that, upon a positive test, will suggest a visit to a doctor for a more thorough evaluation.

While we know that other researchers are working on a breath screening solution for COVID-19, to the best of our knowledge, they are not commercially available.

Other researchers are working on a breath screening solution for COVID-19, and to the best of our knowledge, they are still in the testing stages of their products.

Research and Development

1 st Detect Corporation

We invest considerable resources into our internal research and development functions.

Much of our research and development (“R&D”) investment is devoted to the cross-platform AMS Technology as the R&D team continually works to develop new derivative products, improve system functionality, optimize design, reduce cost, and streamline and simplify the software and user experience.

Much of our research and development (“R&D”) investment is devoted to the cross-platform AMS Technology as the R&D team continually works to develop new derivative products, improve system functionality and reliability, optimize design, reduce cost, and streamline and simplify the software and user experience.

Each market, however, typically requires unique sample introduction technology, library development, and customized adjustments to the user interface.

While 1 st Detect’s TRACER 1000 is fully commercialized, we do continue to invest in cross-platform improvements.

The AgLAB-1000 series uses the core AMS Technology and is continuing its development of its cannabinoid, terpene, solvent, and pesticide libraries.

The AgLAB-1000 series uses the core AMS Technology and is continuing its development of its cannabinoid library.

In addition, AgLAB plans to expand its product line to include other valuable products specific to the hemp and cannabis industry.

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If premarket notification (510(k) submission) is required, we intend to submit a pre-submission request to the FDA.

The pre-submission is a formal mechanism for requesting feedback from FDA prior to submitting a medical device application.

The pre-submission is a formal mechanism for requesting feedback from the FDA prior to submitting a medical device application.

The timeframe for receiving feedback from a pre-submission request is approximately 70 calendar days but may be shorter or longer.

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While most Class I devices are exempt from the 510(k) premarket notification requirement, manufacturers of most Class II devices are required to submit to the FDA a premarket notification under Section 510(k) of the FDCA requesting permission to commercially distribute the device.

The FDA’s permission to commercially distribute a device subject to a 510(k) premarket notification is generally known as 510(k) clearance.

Under the 510(k) proce ss, the manufacturer must submit to the FDA a premarket notification demonstrating that the device is “substantially equivalent” to either a device that was legally marketed prior to May 28, 1976, the date upon which the Medical Device Amendments of 1976 w ere enacted, or another commercially available device that was cleared to through the 510(k) or de novo process.

The FDA’s permission to commercially distribute a device subject to a 510(k) premarket notification is generally known as 510(k)

Under the 510(k) process, the manufacturer must submit to the FDA a premarket notification demonstrating that the device is “substantially equivalent” to either a device that was legally marketed prior to May 28, 1976, the date upon which the Medical Device Amendments of 1976 were enacted, or another commercially available device that was cleared to through the 510(k) or de novo process.

Devices deemed by the FDA to pose the greatest risks, such as life-sustaining, life-supporting or some implantable devices, or devices that have a new intended use, or use advanced technology that is not substantially equivalent to that of a legally marketed device, are placed in Class III, requiring approval of a PMA.

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In December 2018 FDA issued proposed regulations to govern the de novo classification process, which if finalized would further impact this path to market.

As an alternative to the de novo process, a company could also file a reclassification petition, or FDA could initiate such a process, seeking to change the automatic Cla ss III designation of a novel postamendment device under Section 513(f)(3) of the FDCA.

As an alternative to the de novo process, a company could also file a reclassification petition, or the FDA could initiate such a process, seeking to change the automatic Class III designation of a novel post amendment device under Section 513(f)(3) of the FDCA.

Premarket Approval Process.

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Emergency Use Authorization .

The Commissioner of the FDA, under delegated authority from the Secretary of DHHS may, under certain circumstances, issue an Emergency Use Authorization (“EUA”), that would permit the use of an unapproved medical device or unapproved use of an approved medical device.

The Commissioner of the FDA, under delegated authority from the Secretary of DHHS may, under certain circumstances, issue an EUA, that would permit the use of an unapproved medical device or unapproved use of an approved medical device.

Before an EUA may be issued, the Secretary must declare an emergency based on one of the following grounds:

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a determination by the Secretary of DHHS of a public health emergency that effects or has the significant potential to affect, national security, and that involves a specified biological, chemical, radiological, or nuclear agent or agents, or a specified disease or condition that may be attributable to such agent or agents.

In order to be the subject of an EUA, the FDA Commissioner must conclude that, based on the totality of scientific evidence available, it is reasonable to believe that the product may be effective in diagnosing, treating, or preventing a disease attributable to the agents described above, that the pr oduct’s potential benefits outweigh its potential risks and that there is no adequate, approved alternative to the product.

In order to be the subject of an EUA, the FDA Commissioner must conclude that, based on the totality of scientific evidence available, it is reasonable to believe that the product may be effective in diagnosing, treating, or preventing a disease attributable to the agents described above, that the product’s potential benefits outweigh its potential risks and that there is no adequate, approved alternative to the product.

Clinical Trials.

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QSR requirements, which require manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation, and other quality assurance procedures during all aspects of the design and manufacturing process;

labeling and marketing regulations, which require that promotion is truthful, not misleading, fairly balanced, provide adequate directions for use, and that all claims are substantiated, and also prohibit the promotion of products for

unapproved or “off-label” uses and impose other restrictions on labeling;

FDA guidance on off-label dissemination of information and responding to unsolici ted requests for information;

FDA guidance on off-label dissemination of information and responding to unsolicited requests for information;

clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices, or approval of a supplement for certain modifications to PMA devices;

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HIPAA established uniform standards governing the conduct of certain electronic healthcare transactions and requires certain entities, called covered entities, to comply with standards that include the privacy and security of Protected Health Information (“PHI”).

HIPAA also requires business associates, such as independent contractors or agents of covered entities

that have access to PHI in connection with providing a service to or on behalf of a covered entity, of covered entities to enter into business associat e agreements with the covered entity and to safeguard the covered entity’s PHI against improper use and disclosure.

HIPAA also requires business associates, such as independent contractors or agents of covered entities that have

access to PHI in connection with providing a service to or on behalf of a covered entity, of covered entities to enter into business associate agreements with the covered entity and to safeguard the covered entity’s PHI against improper use and disclosure.

The HIPAA privacy regulations cover the use and disclosure of PHI by covered entities as well as business associates, which are defined to include subcontractors that create, receive, maintain, or transmit PHI on behalf of a business associate.

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Although the law includes limited exceptions, including for “protected health information” maintained by a covered entity or business associate, it may regulate or impact our processing of personal information depending on the context.

In the EEA, we may become subject to laws which restrict our collection, control, processing, and other use of personal data (i.e.

data relating to an identifiable living individual) including the GDPR (and any national laws implementing the GDPR).

In the EEA, we may become subject to laws which restrict our collection, control, processing, and other use of personal data (i.e., data relating to an identifiable living individual) including the GDPR (and any national laws implementing the GDPR).

As part of our operations, we process personal data belonging to data subjects in the EEA, including employees, contractors, suppliers, distributors, service providers, customers, patients, or clinical trial participants.

13 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business