What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-03-24 compared with 2021-03-25 · 20 added, 237 removed, 16 unchanged (94% of the section changed)

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER EQUITY SECURITIES

common stock has been quoted on the NASDAQ market under the symbol “CODX”

since July 12, 2017.

The following table

sets forth the high and low prices for our common stock for the periods indicated, as reported by NASDAQ.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER EQUITY SECURITIES

common stock has been quoted on the NASDAQ market under the symbol “CODX” since July 12, 2017.

The following table sets forth

the high and low prices for our common stock for the periods indicated, as reported by NASDAQ.

Calendar Quarter Ended:

8 unchanged sentences

December 31, 2020

of March 18, 2021, the last reported sales price reported on NASDAQ for our common stock was $13.69 per share.

As of March 22, 2022,

2021, we had approximately 150 record holders of our common stock.

The number of record holders was determined from the records

of our transfer agent and does not include beneficial owners of common stock whose shares are held in the names of various security

brokers, dealers, and registered clearing agencies.

The transfer agent for our common stock is VStock Transfer LLC located at

18 Lafayette Pl, Woodmere, New York 11598.

the last reported sales price reported on NASDAQ for our common stock was $6.47 per share.

As of March 22, 2022, we had

approximately 154 record holders of our common stock.

The number of record holders was determined from the records of our transfer

agent and does not include beneficial owners of common stock whose shares are held in the names of various security brokers, dealers,

and registered clearing agencies.

The transfer agent for our common stock is VStock Transfer LLC located at 18 Lafayette Pl, Woodmere,

New York 11598.

have never declared or paid any cash dividends on our capital stock.

The payment of dividends on our common stock in the future

will depend on our earnings, capital requirements, operating and financial condition and such other factors as our Board of Directors

may consider appropriate.

We currently expect to use all available funds to finance the future development and expansion of our

business and do not anticipate paying dividends on our common stock in the foreseeable future.

The payment of dividends on our common stock in the future will

depend on our earnings, capital requirements, operating and financial condition and such other factors as our Board of Directors may

consider appropriate.

We do not anticipate paying dividends on our common stock in the foreseeable future.

Sales of Unregistered Securities

1 unchanged sentence

For the issuances of unregistered securities, we relied on the exemption from registration

requirements of the Securities Act of 1933, as amended, available under Section 4(a)(2) promulgated thereunder due to the fact

that such issuances did not involve a public offering of securities.

January 20, 2021, we issued an aggregate of 4,290 shares of our common stock for services rendered pursuant to consulting

requirements of the Securities Act of 1933, as amended, available under Section 4(a)(2) promulgated thereunder due to the fact that such

issuances did not involve a public offering of securities.

During the year ended December

31, 2021, we issued an aggregate of 5,548 shares of our common stock for services rendered pursuant to consulting agreements.

of Equity Securities by the Issuer and Affiliated Purchasers

SELECTED FINANCIAL DATA

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS

following management’s discussion and analysis of financial condition and results of operations describes the principal

factors affecting the results of our operations, financial condition, and changes in financial condition.

This discussion should

be read in conjunction with the accompanying audited financial statements, and notes thereto, included elsewhere in this report.

The information contained in this discussion is subject to a number of risks and uncertainties.

We urge you to review carefully

the sections of this report entitled “

Risk Factors ”

in other filings with the SEC and “

Forward-Looking

Statements ”

in this Annual Report for a more complete discussion of the risks and uncertainties associated with an investment

in our securities.

Co-Diagnostics,

Inc., a Utah corporation (“Company,”

or “CDI,”) is developing robust and innovative molecular tools for

detection of infectious diseases, liquid biopsy for cancer screening, and agricultural applications.

We have developed and we

manufacture and sell reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules

(DNA or RNA).

In connection with the sale of our tests we may sell diagnostic equipment from other manufacturers as self-contained

lab systems (which we refer to as the “MDx device”).

diagnostics systems enable very rapid, low-cost, molecular testing for organisms and genetic diseases by automating historically

complex procedures in both the development and administration of tests.

CDI’s newest technical advance involves a novel

approach to Polymerase Chain Reaction (“PCR”) test design (“Co-Primers”) that eliminates one of the key

vexing issues of PCR amplification, the exponential growth of primer-dimer pairs (false positives and false negatives) which adversely

interferes with identification of the target DNA/RNA.

proprietary molecular diagnostics technology is paving the way for innovation in disease detection and life sciences research

through our enhanced detection of genetic material.

Because we own our platform, we are able to accomplish this faster and more

economically, allowing for wider margins while still positioning Co-Diagnostics to be a low-cost provider of molecular diagnostics

and screening services.

addition, continued development has demonstrated the unique properties of our Co-Primer technology that make them ideally suited

to a variety of applications where specificity is key to optimal results, including multiplexing several targets, enhanced Single

Nucleotide Polymorphism (“SNP”) detection and enrichment for next gen sequencing.

scientists use the complex mathematics of DNA test design, to “engineer”

a DNA test and to automate algorithms that

rapidly screen millions of possible options to pinpoint the optimum design.

Satterfield, our Chief Technology Officer, developed

the Company’s intellectual property consisting of the predictive mathematical algorithms and proprietary reagents used in

the testing process, which together represent a major advance in PCR testing systems.

CDI technologies are now protected by seven

granted or pending US and foreign patents, as well as certain trade secrets and copyrights.

Ownership of our proprietary platform

permits us the advantage of avoiding payment of patent royalties required by other PCR test systems, which enables the sale of

diagnostic tests at a lower price than competitors, while generating a profit margin.

may either sell or lease the MDX Device to labs and diagnostic centers, through sale or lease agreements, and sell the reagents

that comprise our proprietary tests to those laboratories and testing facilities.

designed our tests by identifying the optimal locations on the target gene for amplification and paired the location with the

optimized primer and probe structure to achieve outputs that meet the design input requirements identified from market research.

This is done by following planned and documented processes, procedures and testing.

In other words, the data resulting from our

tests verify that we succeeded in designing what we intended at the outset.

Verification is a series of testing that concludes

that the product is ready to proceed to validation in a clinical evaluation setting using initial production tests to confirm

that the product as designed meets the user needs.

its proprietary test design system and proprietary reagents, CDI has designed and obtained regulatory approval to sell PCR diagnostic

tests for COVID-19, a multiplex test for Flu A, Flu B and COVID-19, tuberculosis, hepatitis B and C, human papilloma virus, Malaria,

chikungunya, dengue, and the Zika virus.

addition to testing for infectious disease, the technology lends itself to identifying any section of a DNA strand that describe

any type of genetic trait, which creates a number of significant applications.

We are active in designing and licensing tests

that identify genetic traits in plant and animal genomes.

We also have a number of tests developed to test mosquitos for the identification

of diseases carried by the mosquitos to enable municipalities to concentrate their efforts in spraying mosquito populations on

the specific areas known to be breeding the mosquitos that carry deadly viruses.

OF OPERATIONS

of Operations for the Years Ended December 31, 2020 and 2019

table below provides a comparison of our operating results for the year ended December 31, 2020 as compared to the year ended

December 31, 2019.

Years Ended December 31,

Cost of revenue

Operating expenses

Sales and marketing

General and administrative

Research and development

Depreciation and amortization

Total operating expenses

Income (loss) from operations

Other income (expense)

Interest income

Interest expense

Gain (loss) on disposition of assets

Gain (loss) on equity method investment in joint venture

Total other income (expense)

Income (loss) before income taxes

Income tax provision

Net income (loss)

$ (6,195,557 )

the year ended December 31, 2020, we generated $74.5 million of revenue compared to revenue of $0.2 million in the year ended

December 31, 2019.

The increase in revenue of $74.3 million was primarily due to sales of our LogixSmart COVID-19 test throughout

the world, which was developed in response to the current COVID-19 pandemic.

Of the total revenue in 2020, $3.7 million was from

the sale of third party manufactured equipment and supplies that we sourced and sold to customers to facilitate usage of our test.

The majority of our revenue in 2019 was from sales of equipment and tests to mosquito abatement districts and the remainder was

sales of our test reagents and licensing revenue.

of Revenues and Gross Profit

of revenues increased by $16.5 million from $0.1 million for the year ended December 31, 2019 to $16.6 million for the year ended

December 31, 2020.

The increase in cost of revenues was due to the significant increase in revenue discussed above.

margin was 77.7% for the year ended December 31, 2020 compared to 47.7% for the year ended December 31, 2019.

in gross margin was due to the mix of products we sold, as the majority of our 2020 revenue came from sales of our test reagents,

which has a higher profit margin than sales of equipment.

In 2019, the majority of the revenue was generated from equipment sales.

incurred total operating expenses of $16.3 million for the year ended December 31, 2020 compared to total operating expenses of

$6.0 million for the year ended December 31, 2019.

The increase in operating expenses was primarily due to the increase in business

activities experienced as a result of our increase in revenue.

and administrative expenses increased $4.8 million from $3.5 million for the year ended December 31, 2019 to $8.3 million for

the year ended December 31, 2020.

The increase in general and administrative expenses was primarily due to increased activity

to support the growth of our business.

The primary drivers of the increased expenses related to increases in stock-based compensation,

employee related expenses and increased expenses for professional services.

sales and marketing expenses for the year ended December 31, 2020 were $4.7 million compared to $1.1 million for the year ended

December 31, 2019.

The increase of $3.6 million was primarily a result of increased personnel related expenses, including commissions

paid to our sales team and distributors, due to the growth in revenue noted above.

research and development expenses increased by $1.8 million from $1.4 million for the year ended December 31, 2019, to $3.2 million

for the year ended December 31, 2020.

The increase was primarily due to an increase in salaries and related benefits, including

stock-based compensation, as we have added additional employees to our research and development team to increase our product development

Additionally, there has been an increase in professional and lab services utilized to further help us in our research

and product development activities.

Income (Expense)

income was $875,000 for the year ended December 31, 2020 compared to other expense of $302,000 for the year ended December 31,

The increase in other income of $1.2 million was primarily related to recording a gain of $778,000 from our India joint

venture and incurring no interest expense during 2020.

For the year ended December 31, 2019 we had recorded a loss $233,000 from

our India joint venture and incurred interest expense of $106,000.

Income (Loss)

realized net income for the year ended December 31, 2020 of $42.5 million compared with a net loss of $6.2 million for the year

ended December 31, 2019.

The increase in net income of $48.7 million was primarily the result of sales of our LogixSmart COVID-19

test and resulting margins from those sales offset by increased operating expenses as discussed above.

Additionally, we recorded

an income tax expense of $0.1 million during the year ended December 31, 2020 as a result of our net income for 2020.

we released our deferred tax asset valuation allowance and recorded a deferred tax asset since we utilized our net operating losses

from prior years during the year ended December 31, 2020.

AND CAPITAL RESOURCES

prior years, we financed our operations through the issuance of equity and debt.

In 2020, we financed our operations primarily

through profitable operations and secondarily through the issuance of common stock.

December 31, 2020, we had cash and cash equivalents of $43.0 million and marketable investment securities of $4.3 million that

could readily be converted into cash if needed.

Additionally, our total current assets at December 31, 2020, were $68.4 million

compared to total current liabilities of $4.5 million.

cash provided by operating activities during the year ended December 31, 2020 was $28.2 million, compared to cash used in operating

activities of $5.5 million for the year ended December 31, 2019.

The increase in cash from operating activities was primarily

due to our increased revenue offset by increases in accounts receivable and inventory.

used $5.8 million of our cash for investing activities during the year ended December 31, 2020 as compared to $0.4 million during

the year ended December 31, 2019.

The increase in cash used for investing activities is primarily due to purchasing marketable

investment securities, increased purchases of property and equipment needed to support our increased revenue and additional investment

in our India joint venture offset by proceeds received from maturities of marketable investment securities.

cash provided by financing activities was $19.7 million for the year ended December 31, 2020, compared to $5.9 million for the

year ended December 31, 2019.

The increase is primarily due to net proceeds of $18.0 million received from a series of three registered

direct offerings in January and February 2020 pursuant to our shelf registration in addition to receiving $1.7 million from the

exercise of warrants and options for the year ended December 31, 2020.

Net proceeds of $5.9 million was received during the year

ended December 31, 2019 from the sale of common and preferred stock.

commencing sales of our Logix Smart COVID-19 test in March 2020, we have used our cash generated from those sales to fund the

increase in our inventories and receivables and pay our operating expenses.

We have increased our work force primarily in the

area of research and development to complete development of additional tests to enable us to use our distributor network to sell

other products throughout the world and remain profitable in the future.

believe that our existing capital resources and the cash generated from future sales will be sufficient to meet our projected

operating requirements for the next 12 months.

However, our available capital resources

may be consumed more rapidly than currently expected and we may need or want to raise additional financing for strategic opportunities.

If needed, we expect additional investment capital to come from (i) additional issuances of our common stock with existing and

new investors or (ii) the private placement of other securities with investors similar to those that have provided funding in

We may not be able to secure such financing in a timely manner or on favorable terms, if at all.

October 30, 2020, we filed a Registration Statement on Form S-3 (File No:

333-249651) with the Securities and Exchange Commission

(the “SEC”).

The SEC declared the Form S-3 effective on November 5, 2020.

Pursuant to a prospectus supplement to the

Form S-3, we may offer and sell up to $100 million of the following securities separately or together, in one or more series or

classes and in amounts, at prices and on terms described in one or more offerings:

common stock;

preferred stock;

purchase our securities, each of which may be convertible into equity securities;

or units comprised of, or other combinations

of, the foregoing securities through underwriting syndicates managed or co-managed by one or more underwriters or dealers, through

agents or directly to purchasers.

Each time our securities are offered, we will provide a prospectus supplement to the Form S-3

containing more specific information about the particular offering.

To date, we have not filed a prospectus supplement to, or

sold any securities under, this Form S-3.

is a summary of the direct offerings done in 2020:

January 2020, we sold an aggregate of 3,448,278 shares of common stock to institutional investors for $1.45 per share for

gross proceeds of approximately $5.0 million pursuant to a shelf-registration statement on Form S-3 (File No:

declared effective by the SEC on September 7, 2018 (the “Shelf Registration Statement”).

February 10, 2020, the Company entered into securities purchase agreements with certain institutional investors pursuant to

which such investors purchased an aggregate of 3,324,676 shares of common stock at a purchase price of $ 3.08 per share in

a registered direct offering pursuant to the Shelf Registration Statement.

The aggregate gross proceeds for the sale of the

shares were approximately $10.2 million.

The closing of the offering occurred on or about February 13, 2020.

February 28, 2020, the Company entered into securities purchase agreements with certain institutional investors pursuant to

which such investors purchased an aggregate of 470,000 shares of common stock at a purchase price of $9.00 per share in a

registered direct offering pursuant to the Shelf Registration Statement.

The aggregate gross proceeds for the sale of the

shares were approximately $4.0 million.

The closing of the offering occurred on or about February 28, 2020.

foregoing estimates, expectations and forward-looking statements are subject to change as we make strategic operating decisions

from time to time and as our revenue and expenses fluctuate from period to period.

Sheet Arrangements

of December 31, 2020, we had no off-balance sheet arrangements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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 5. Market for Registrant’s Common Equity