What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-08-08 compared with 2024-05-09 · 102 added, 65 removed, 140 unchanged (54% of the section changed)

47 unchanged sentences

of primer and probe structure (“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.

Using our proprietary test design system and proprietary reagents, we have designed and obtained regulatory approval to sell PCR diagnostic

tests for the detection of COVID-19, influenza, tuberculosis, hepatitis B and C, human papillomavirus, malaria, chikungunya, dengue,

and the Zika virus.

These initial diagnostic tests are cleared for use in clinical labs only and not for point-of-care or at-home use.

exponential growth of primer-dimer pairs (false positives and false negatives) which adversely interferes with identification of the

target DNA/RNA.

Using our proprietary test design system and proprietary reagents, we have designed and obtained regulatory approval

to sell PCR diagnostic tests for the detection of COVID-19, influenza, tuberculosis, hepatitis B and C, human papillomavirus, malaria,

chikungunya, dengue, and the Zika virus.

These initial diagnostic tests are cleared for use in clinical labs only and not for point-of-care

or at-home use.

are currently developing a unique, groundbreaking portable diagnostic device and test system designed for point-of-care and at-home use.

7 unchanged sentences

and is not available for sale at the time of this filing.

In June 2024, we completed our first U.S.

Food and Drug Administration (FDA)

application for 510(k) clearance for the Co-Dx™ PCR Pro™ instrument, and the Co-Dx PCR COVID-19 Test for over-the-counter

We have received acknowledgement from the FDA that the 510(k) application was received and is under review.

Additionally,

in December 2023, we submitted the Co-Dx PCR platform for review by the U.S.

Food and Drug Administration (FDA) for Emergency Use Authorization (EUA).

The submission included the PCR Pro instrument, Co-Dx PCR COVID-19

detection test cups, and mobile app, all designed for use in point-of-care and at-home settings.

There is no guarantee that our Co-Dx

PCR platform will receive the necessary regulatory approvals for commercialization, or that, if regulatory approval is received, we will

be able to successfully commercialize this platform.

Food and Drug Administration (FDA) for Emergency Use Authorization

There is no guarantee that our Co-Dx PCR platform will receive the necessary regulatory approvals for commercialization, or that,

if regulatory approval is received, we will be able to successfully commercialize this platform.

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

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OF OPERATIONS

Three Months Ended March 31, 2024 Compared to the Three Months ended March 31, 2023

the three months ended March 31, 2024, we generated revenues of $467,854, compared to revenues of $601,957 for the three months ended

March 31, 2023.

Grant revenue accounted for $215,109 of revenue for the three months ended March 31, 2024, compared to $0 for the three

months ended March 31, 2023.

The decrease in total revenue of $134,103 was primarily due to lower sales of our Logix Smart COVID-19 throughout

recorded cost of revenues of $234,505 for the three months ended March 31, 2024, compared to $502,241 for the three months ended March

After adjusting for the effect of the grant revenue in the current period, cost of revenues and gross margins are comparable

for the three months ended March 31, 2024 and 2023, respectively.

incurred total operating expenses of $10,492,736 for the three months ended March 31, 2024, compared to total operating expenses of $10,050,366

for the three months ended March 31, 2023.

The increase in operating expenses was primarily due to increased personnel expenses and additional

investment in research and development.

These increases were partially offset by decreased stock compensation expense.

sales and marketing expenses for the three months ended March 31, 2024 were $1,563,682, compared to $1,706,331 for the three months ended

March 31, 2023.

The decrease was primarily a result of decreased stock-based compensation expense, partially offset by increased tradeshow

and travel expenses.

and administrative expenses remained materially consistent at $2,918,803 for the three months ended March 31, 2024, compared to $3,013,965

for the three months ended March 31, 2023.

The decrease in general and administrative expenses was primarily due to decreases in stock

compensation, insurance expense, and professional services expenses, partially offset by increased legal expenses.

research and development expenses increased to $5,679,678 for the three months ended March 31, 2024, compared to $5,014,060 for the three

months ended March 31, 2023.

The primary increase in expenses was a result of increases in personnel related expenses and expenses related

to development of the Co-Dx PCR platform.

the three months ended March 31, 2024 we had total other income of $970,108, compared to total other income of $1,935,448 for the three

months ended March 31, 2023.

The primary components of other income include a change in the fair value of contingent consideration liabilities

and interest income and realized gains from investments in marketable securities.

realized a net loss for the three months ended March 31, 2024 of $9,312,043, compared to a net loss for the three months ended March

Three Months Ended June 30, 2024 Compared to the Three Months ended June 30, 2023

the three months ended June 30, 2024, we generated revenues of $2,656,840, compared to revenues of $197,806 for the three months ended

June 30, 2023.

Grant revenue accounted for $2,495,738 of revenue for the three months ended June 30, 2024, compared to $0 for the three

months ended June 30, 2023.

The increase in grant revenue was primarily due to the achievement of certain milestones under various grants

the Company was awarded.

recorded cost of revenues of $212,148 for the three months ended June 30, 2024, compared to $459,095 for the three months ended June

The decrease in cost of revenues of $246,947 is primarily due to lower inventory obsolescence reserves recorded in the current

incurred total operating expenses of $10,124,654 for the three months ended June 30, 2024, compared to total operating expenses of $11,733,150

for the three months ended June 30, 2023.

The decrease in operating expenses was primarily due to decreased stock-based compensation

expense, bad debt expense, and expense related to clinical trials for the Co-Dx PCR platform.

These decreases were partially offset by

increased legal expenses.

sales and marketing expenses for the three months ended June 30, 2024 were $1,041,243, compared to $1,732,966 for the three months ended

June 30, 2023.

The decrease was primarily a result of decreased stock-based compensation expense, tradeshow and travel expenses, and

website development expenses.

and administrative expenses were $3,132,385 for the three months ended June 30, 2024, compared to $3,713,895 for the three months ended

June 30, 2023.

The decrease in general and administrative expenses was primarily due to decreases in stock-based compensation expense,

bad debt expense, and insurance expense, partially offset by increased legal and professional services expenses.

research and development expenses were $5,612,691 for the three months ended June 30, 2024, compared to $5,981,043 for the three months

ended June 30, 2023.

The decrease was primarily a result of decreased expenses related to clinical trials for the Co-Dx PCR platform

and stock-based compensation expense, partially offset by increases in personnel related expenses.

the three months ended June 30, 2024 we had total other income of $101,234, compared to total other income of $837,294 for the three

months ended June 30, 2023.

The decrease in other income is primarily due to a change in the fair value of contingent consideration liabilities

and decreased realized gains from investments in marketable securities, partially offset by increased interest income.

realized a net loss for the three months ended June 30, 2024 of $7,599,318, compared to a net loss for the three months ended June 30,

2023 of $8,918,825.

The larger net loss was primarily the result of an increase in operating expenses, as well as changes in the

fair value of acquisition contingencies and income related to investments in marketable securities.

Additionally, we recorded income

tax expense of $22,764 for the three months ended March 31, 2024, compared to an income tax benefit of $2,259,811 for the three months

ended March 31, 2023.

The primary reason for the change in the provision for income taxes is a result of the Company now being in a full

valuation allowance.

The smaller net loss was primarily the result of an increase in grant revenue, combined with a decrease in operating

expenses, as well as changes in the fair value of acquisition contingencies and income related to investments in marketable securities.

Additionally, we recorded income tax expense of $20,590 for the three months ended June 30, 2024, compared to an income tax benefit of

$2,238,320 for the three months ended June 30, 2023.

The primary reason for the change in the provision for income taxes is a result

of the Company now being in a full valuation allowance.

Six Months Ended June 30, 2024 Compared to the Six Months ended June 30, 2023

the six months ended June 30, 2024, we generated revenues of $3,124,694, compared to revenues of $799,763 for the six months ended June

Grant revenue accounted for $2,710,847 of revenue for the six months ended June 30, 2024, compared to $0 for the six months

ended June 30, 2023.

The decrease in product revenue of $385,916 was primarily due to lower sales of our Logix Smart COVID-19 throughout

The increase in grant revenue was primarily due to the achievement of certain milestones under various grants the Company

recorded cost of revenues of $446,653 for the six months ended June 30, 2024, compared to $961,336 for the six months ended June 30,

The decrease in cost of revenues of $514,683 is primarily due to lower inventory obsolescence reserves being recorded in the current

incurred total operating expenses of $20,617,390 for the six months ended June 30, 2024, compared to total operating expenses of $21,783,516

for the six months ended June 30, 2023.

The decrease in operating expenses was primarily due to decreased stock-based compensation expense,

bad debt expense and expense related to clinical trials for the Co-Dx PCR platform.

These decreases were partially offset by increased

personnel related expenses and legal expenses.

sales and marketing expenses for the six months ended June 30, 2024 were $2,604,925, compared to $3,439,297 for the six months ended

June 30, 2023.

The decrease was primarily a result of decreased stock-based compensation expense, tradeshow and travel expenses, and

website development expenses.

and administrative expenses were $6,051,188 for the six months ended June 30, 2024, compared to $6,727,860 for the six months ended June

The decrease in general and administrative expenses was primarily due to decreases in stock-based compensation expense, bad

debt expense, and insurance expense, partially offset by increased legal and professional services expenses.

research and development expenses were $11,292,369 for the six months ended June 30, 2024, compared to $10,995,103 for the six months

ended June 30, 2023.

The primary increase in expenses was a result of increased personnel related expenses, partially offset by decreased

expenses related to clinical trials for the Co-Dx PCR platform and stock-based compensation expense.

the six months ended June 30, 2024 we had total other income of $1,071,342, compared to total other income of $2,772,742 for the six

months ended June 30, 2023.

The decrease in other income is primarily due to a change in the fair value of contingent consideration liabilities,

an increased loss related to the Company’s joint venture investment, and decreased realized gains from investments in marketable

securities, partially offset by increased interest income.

realized a net loss for the six months ended June 30, 2024 of $16,911,361, compared to a net loss for the six months ended June 30, 2023

of $14,674,216.

The larger net loss was primarily the result of changes in the fair value of acquisition contingencies and income taxes,

partially offset by an increase in grant revenue combined with a decrease in operating expenses.

We recorded income tax expense of $43,354

for the six months ended June 30, 2024, compared to an income tax benefit of $4,498,131 for the six months ended June 30, 2023.

reason for the change in the provision for income taxes is a result of the Company now recording a full valuation allowance.

and Capital Resources

March 31, 2024, we had cash and cash equivalents of $23,099,251.

June 30, 2024, we had cash and cash equivalents of $13,858,866.

Additionally, we had $31,020,811 of marketable investment securities

that could readily be converted into cash if needed.

Additionally, our total current assets of March 31, 2024, were $53,698,833 compared

Additionally, our total current assets of June 30, 2024, were $48,219,239 compared

to total current liabilities of $5,305,385.

cash used in operating activities during the three months ended March 31, 2024 was $8,490,334, compared to $5,917,517 for the three months

ended March 31, 2023.

The decrease in cash from operating activities was primarily due to decreased revenues and increased operating

expenses, and the impact of non-cash items.

cash provided by investing activities during the three months ended March 31, 2024 was $16,672,707, primarily from maturities of marketable

investment securities, compared to cash used in investing activities of $10,214,710 during the three months ended March 31, 2023.

cash used in financing activities was $0 for the three months ended March 31, 2024, compared to net cash used in financing activities

of $482,196 for the same period in the prior year.

This is due to the repurchase of outstanding common shares during the prior period,

compared to no such repurchases in the current period.

cash used in operating activities during the six months ended June 30, 2024 was $13,694,532, compared to $11,538,068 for the six months

ended June 30, 2023.

The increase in cash used in operating activities was primarily due to increased operating expenses and the impact

of non-cash items.

cash provided by investing activities during the six months ended June 30, 2024 was $12,636,520, primarily from maturities of marketable

investment securities, compared to $3,433,041 during the six months ended June 30, 2023.

cash used in financing activities was $0 for the six months ended June 30, 2024, compared to $1,037,930 for the same period in the prior

This is due to the repurchase of outstanding common shares during the prior period, compared to no such repurchases in the current

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

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No shares have been sold

under the distribution agreement as of March 31, 2024.

We may not be able to secure such financing in a timely manner or on favorable

terms, if at all.

under the distribution agreement as of June 30, 2024.

We may not be able to secure financing in a timely manner or on favorable terms,

Sheet Arrangements

3 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-Q

Item 2. Management’s Discussion and Analysis