What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-11-15 compared with 2021-08-16 · 205 added, 197 removed, 110 unchanged (79% of the section changed)

28 unchanged sentences

1 of this Quarterly Report on Form 10-Q.

Incorporated in Delaware in

May 2010, we are a medical device company focused on the design, development and commercialization of non-invasive glucose monitoring

devices for use by people with diabetes and pre-diabetics.

On July 15, 2010, we completed a reverse triangular merger with Integrity

Israel and Integrity Acquisition Corp.

Ltd., an Israeli corporation and a wholly owned subsidiary of ours, pursuant to which Integrity

Acquisition Corp.

merged with and into Integrity Israel and all of the stockholders and option holders of Integrity Israel became

entitled to receive shares and options in us in exchange for their shares and options in Integrity Israel (the “Reorganization”).

in Delaware in May 2010, we are a medical device company focused on the design, development and commercialization of non-invasive glucose

monitoring devices for use by people with diabetes and pre-diabetics.

On July 15, 2010, we completed a reverse triangular merger with

Integrity Israel and Integrity Acquisition Corp.

Ltd., an Israeli corporation and a wholly owned subsidiary of ours, pursuant to which

Integrity Acquisition Corp.

merged with and into Integrity Israel and all of the stockholders and option holders of Integrity Israel

became entitled to receive shares and options in us in exchange for their shares and options in Integrity Israel (the “Reorganization”).

Following the Reorganization, the former equity holders of Integrity Israel were entitled to the same proportional ownership in us as

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We operate primarily through Integrity Israel.

Integrity Israel was founded

in 2001 with a mission to develop, produce and market non-invasive glucose monitors for home use by diabetics.

We have developed

a non-invasive glucose monitor, the GlucoTrack® glucose monitoring device, which is designed to help people with diabetes and

pre-diabetics obtain glucose level readings without the pain, inconvenience, cost and difficulty of conventional (invasive) spot

Israel was founded in 2001 with a mission to develop, produce and market non-invasive glucose monitors for home use by diabetics.

have developed a non-invasive glucose monitor, the GlucoTrack® glucose monitoring device, which is designed to help people with diabetes

and pre-diabetics obtain glucose level readings without the pain, inconvenience, cost and difficulty of conventional (invasive) spot

finger stick devices.

The first generation GlucoTrack® (“GlucoTrack 1.0”) utilizes a patented combination

of ultrasound, electromagnetic and thermal technologies to obtain glucose measurements in less than one minute via a small sensor that

is clipped onto one’s earlobe and connected to a small, handheld control and display unit, all without drawing blood or interstitial

The first generation GlucoTrack (“GlucoTrack 1.0”) utilizes a patented combination of ultrasound,

electromagnetic and thermal technologies to obtain glucose measurements in less than one minute via a small sensor that is clipped onto

one’s earlobe and connected to a small, handheld control and display unit, all without drawing blood or interstitial fluid.

are currently developing our own companion applications and a cloud-based solution, as well as conducting ongoing discussions with potential

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and that this is an opportunity for us to develop an additional revenue source.

After a short calibration

process of approximately thirty minutes and consisting of three invasive reference measurements, GlucoTrack 1.0 can be used to non-invasively

measure glucose levels for six months before a user is required to repeat the calibration process.

The entire calibration process can

be performed by the user themselves without the need for a trained calibrator.

We believe the simple-to-perform calibration, as well

as the infrequency of the required re-calibration are significant advantages over our competition.

GlucoTrack 1.0 has received

the initial Conformité Européene (CE) Mark (indicating the conformity of the Company’s product with health, safety,

and environmental protection standards for products sold within the European Economic Area) approval for the GlucoTrack® 1.0

from DEKRA Certification B.V., our European notified body (the “Notified Body”), which is an entity that has been accredited

by a member state of the European Union (“EU”) to assess whether a product to be placed on the market meets certain preordained

The intended use for GlucoTrack 1.0 received by the Notified Body is for both those with Type 2 diabetes as well as those

suffering from pre-diabetes.

Receipt of the CE Mark allows

us to market and sell GlucoTrack® 1.0 glucose monitoring device in EU member countries that have adopted the European Medical Device

Directive (the “MDD”) without being subject to additional national regulations with regard to demonstration of performance

However, although the MDD is applicable throughout the EU, in practice it does not ensure uniform regulation throughout the

Accordingly, member countries may apply and enforce the MDD’s terms differently, and certain EU member countries may request

or require performance and/or safety data in addition to the MDD’s requirements from time to time, on a case-by-case basis.

CE Mark also permits the sale in countries that have an MDD Mutual Recognition Agreement with the EU.

This would include some countries

in South East Asia as well as in Latin America, opening new potential markets for Integrity on a global basis.

a home-based short calibration process of approximately thirty minutes consisting of three typical blood glucose reference

measurements, GlucoTrack 1.0 can be used to non-invasively measure glucose levels for six months before a user is required to repeat

the calibration process.

The entire calibration process can be performed by the user themselves without the need for a trained calibrator.

We believe the simple-to-perform calibration, as well as the infrequency of the required re-calibration are significant advantages over

our competition.

1.0 has received the initial Conformité Européene (CE) Mark (indicating the conformity of the Company’s product

with health, safety, and environmental protection standards for products sold within the European Economic Area) approval for the

GlucoTrack 1.0 from DEKRA Certification B.V., our European notified body (the “Notified Body”), which is an entity that

has been accredited by a member state of the European Union (“EU”) to assess whether a product to be placed on the

market meets certain preordained standards.

The intended use for GlucoTrack 1.0 received by the Notified Body is for both those subjects

with Type 2 diabetes as well as those suffering from pre-diabetes.

of the CE Mark allows us to market and sell GlucoTrack 1.0 glucose monitoring device in EU member countries that have adopted the

European Medical Device Directive (the “MDD”) without being subject to additional national regulations with regard to demonstration

of performance and safety.

However, although the MDD is applicable throughout the EU, in practice it does not ensure uniform regulation

throughout the EU.

Accordingly, member countries may apply and enforce the MDD’s terms differently, and certain EU member countries

may request or require performance and/or safety data in addition to the MDD’s requirements from time to time, on a case-by-case

The CE Mark also permits the sale in countries that have an MDD Mutual Recognition Agreement with the EU.

This would include some

countries in South East Asia as well as in Latin America, opening new potential markets for Integrity on a global basis.

and quality are non-negotiables in the medical devices industry.

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sets out the requirements for a quality management system specific to the medical devices industry.

On February 19, 2016, we received

On March 1, 2019 we received

an extension of our ISO 13485:2016 certificate and Annex II certification from the EU.

The ISO 13485:2003 certification signifies that

we have met the standards required for company-wide implementation of device quality management system(s).

The scope of the certification

is design, development, manufacture and service of non-invasive glucose monitoring systems for home use.

Annex II also addresses quality

control systems.

The certification allows us to self-certify certain modifications and changes and simplifies some of the reporting to

and review by the relevant Notified Body.

The ISO 13485:2016 certification

signifies that we have met the standards required for company-wide implementation of device quality management system(s).

the certification is design, development, manufacture and service of non-invasive glucose monitoring systems for home use.

Annex II also

addresses quality control systems.

The certification allows us to self-certify certain modifications and changes and simplifies some

of the reporting to and review by the relevant Notified Body.

This can shorten the CE-mark review process of future GlucoTrack enhancements

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or modified GlucoTrack devices.

Clinical trials conducted

in Germany by Pfutzner Science & Health Institute, GmbH, headed by Prof.

Andreas Pfutzner, on subjects with Type 2 diabetes and

pre-diabetes, as well as at Soroka University Medical Center, Beer-Sheva, Israel, demonstrated favorable results.

Results from the trials

show 99.7% of the study data points within the clinically accepted A and B zones of the Consensus Error Grid (which is a new tool for

evaluating the accuracy of a blood glucose meter) (Type 2), 99.3% of the study data points were within the clinically accepted A and

B zones of the Clarke Error Grid (which is a tool used to quantify the clinical accuracy of blood glucose estimates generated by meters

as compared to a reference value), 17.0% Mean Absolute Relative Difference, and 12.9% Median Absolute Relative Difference.

the German trial concluded that the data confirms the performance of the GlucoTrack® among its intended users, including pre-diabetic

trials conducted in Germany by Pfutzner Science & Health Institute, GmbH, headed by Prof.

Andreas Pfutzner, on subjects with

Type 2 diabetes and pre-diabetes, as well as at Soroka University Medical Center, Beer-Sheva, Israel, demonstrated favorable results.

Results from the trials show 99.3% of the study data points were within the clinically accepted A and B zones of the Clarke Error Grid

(which is a tool used to quantify the clinical accuracy of blood glucose estimates generated by meters as compared to a reference value),

and 17.0% Mean Absolute Relative Difference.

In addition, the German trial concluded

that the data confirms the performance of the GlucoTrack among its intended users, including pre-diabetic patients.

In addition, the Company has

demonstrated (1) the GlucoTrack® algorithm, which compensates for the tissue-lagging effect relative to blood glucose changes post-meal

intake, significantly improves GlucoTrack® accuracy at different post-prandial (post- meal) states, and equalizes accuracy for pre-

and post-meal glucose readings;

(2) GlucoTrack® clinical accuracy as measured by Consensus Error Grid (CEG) showed 100% of the pre-prandial

readings in the A+B zones, and 98.2% of the post-prandial readings in the A+B zones;

(3) GlucoTrack® 1.0 demonstrates consistent

glucose measurement repeatability between different GlucoTrack® devices and on each earlobe of the same subject;

(4) the repeatability

of different GlucoTrack® devices is similar at all tested glucose ranges and post-prandial time periods;

and (5) the GlucoTrack®

mean precision absolute relative difference (PARD) of 8.2% is equivalent or better than the independently reported PARD values of commercially

available continuous glucose monitoring systems.

The Company conducted a study

that evaluated GlucoTracker accuracy in 172 adults with type 2 diabetes who were prescribed one or more medications for major medical

conditions associated with diabetes and presented key findings of this study at the European Association for the Study of Diabetes Congress

(EASD) in Lisbon, Portugal.

The experiment stratified participants into five medication groups, focusing on anti-cholesterolemia, anti-hypertension,

anti-thrombotic, and anti-diabetic (prolonged duration and short and mixed duration) medications.

The study demonstrated that the use

of these common concomitant medications in diabetes had no effect on the performance of GlucoTrack®.

In 2018, the Company presented

at the 11th International Conference on Advanced Technologies & Treatments for Diabetes (ATTD 2018) in Vienna, Austria.

presented data on the performance of a non-invasive glucose monitoring device (GlucoTrack®) with regard to accuracy and precision.

Device accuracy data was presented for 37 people with type 2 diabetes using the consensus error grid analysis for type 2 diabetes and

measuring the median absolute relative difference (ARD).

The results showed that 99.6% of 257 measurements were in zones A and B of the

Consensus error grid, with 90.3% of the measurements in zone A, the mean and median ARD were 17.2% and 12.9%, respectively, and at various

glucose levels, mean PARD ranged from 7.7%-8.7%.

Data was also presented on sensor to sensor precision in 20 people with type 2 diabetes

where ~19 simultaneous measurements using two GlucoTrack® devices, one on each earlobe.

The results show that GlucoTrack® is highly

accurate with sensor-to-sensor precision is comparable to that of CGMs (GlucoTrack:

8.1%, Dexcom G6:

9.0%, Freestyle Navigator:

The Company had begun the

implementation of a proof of concept pilot program for GlucoTrack 1.0 in the Netherlands, a country chosen based on the relatively

smaller size of the marketplace to allow us to be able to rapidly assess our performance and make adjustments as necessary.

have been working closely with our exclusive distributor in the Netherlands, Medireva B.V., and have accomplished product

and disease area training across the organization and segmentation of the local target audiences including key opinion leaders,

treating physicians, and diabetes nurses.

The most important aspect of our pilot program in the Netherlands are the discussions

held with many health insurance companies.

Approval of full or partial reimbursement by the health insurance companies will be a key

factor in enabling us to achieve significant sales volume.

The Company has made progress with several of these companies on initial

programs with GlucoTrack 1.0 as an important step towards reimbursement approval.

development, recruiting and organizational health have been a critical focus of the Company over the last 12 months.

A number of high-quality

individuals have joined the Company, each of whom bring extensive experience in their respective fields.

We have bolstered our Senior

Management with the recruitment of Erez Ben-Zvi, a highly experienced MedTech development professional who joined us last year as Vice

President of Product, and recently took on the additional role of General Manager, and Shalom Shushan, a seasoned executive who joined

us as Chief Technology Officer.

We added two new independent directors;

Goode PhD, who has a decorated career developing innovative

medical technologies, including at DexCom and MiniMed, and Luis J.

Malavé, formerly of Insulet Corp, Medtronic and MiniMed.

highly talented and accomplished executives joined the Company as senior advisors to the Board.

These include Yair Briman, the former

CEO of Philips Healthcare Informatics, Daniel McCaffrey MBA MA, a world-renowned behavioral scientist and digital health expert currently

at Samsung Health and formerly of Dexcom, Dr.

Alexander Raykhman PhD, a measurement and artificial intelligence expert and Dr.

Klonoff, world renowned endocrinologist and diabetes technology thought leader.

We intend to continue to invest in our talent and

to expand and strengthen all areas within the company.

Recently, the Company performed

a top-down analysis of the GlucoTrack 1.0 model to identify areas of potential enhancement, as it relates to the platform, integrations,

sensor technologies, accuracy as well as costs to manufacture.

The result of this comprehensive review is an accelerated development

plan for GlucoTrack 2.0.

GlucoTrack 2.0 will be a completely wireless and rechargeable earclip to be paired with a smartphone, with more

capabilities and features, increased accuracy, significantly greater margins for the Company and lower cost to the end-user as compared

to GlucoTrack 1.0.

As previously reported,

the Company has made significant progress towards receiving insurance reimbursement in the Netherlands.

With the new accelerated development

plan for GlucoTrack 2.0, with all of the expected advantages over GlucoTrack 1.0, it made clear to the Company that introducing GlucoTrack

2.0 rather than the GlucoTrack 1.0 would serve the diabetes market and the Company more effectively.

We are currently working with our

European partners on the roadmap for distribution of GlucoTrack 2.0 when completed and ready to market.

In addition to the European

markets, the Company is now focused on the U.S.

demonstrated (1) GlucoTrack 1.0 demonstrates consistent glucose measurement repeatability between different GlucoTrack devices

and on each earlobe of the same subject;

(2) the repeatability of different GlucoTrack 1.0 devices is similar at all tested

glucose ranges and post-prandial time periods;

and (3) the GlucoTrack 1.0 mean precision absolute relative difference (PARD)

of 8.2% is equivalent or better than the independently reported PARD values of commercially available continuous glucose monitoring systems.

Company conducted an additional study that evaluated GlucoTrack accuracy in 172 adults with type 2 diabetes who were prescribed

one or more medications for major medical conditions associated with diabetes and presented key findings of this study at the European

Association for the Study of Diabetes Congress (EASD) in Lisbon, Portugal.

The experiment stratified participants into five medication

groups, focusing on anti-cholesterolemia, anti-hypertension, anti-thrombotic, and anti-diabetic (prolonged duration and short and mixed

duration) medications.

The study demonstrated that the use of these common concomitant medications in diabetes had no effect on the performance

of GlucoTrack 1.0.

Company had begun the implementation of a proof-of-concept pilot program for GlucoTrack 1.0 in the Netherlands, a country chosen

based on the relatively smaller size of the marketplace to allow us to rapidly assess our performance and make adjustments as necessary.

We have been working closely with our exclusive distributor in the Netherlands, Medireva B.V., and have accomplished product and disease

area training across the organization and segmentation of the local target audiences including key opinion leaders, treating physicians,

and diabetes nurses.

The most important aspect of our pilot program in the Netherlands are the discussions held with many health insurance

Approval of full or partial reimbursement by the health insurance companies will be a key factor in enabling us to achieve

significant sales volume.

The Company has made progress with several of these companies on initial programs with GlucoTrack 1.0 as an

important step towards reimbursement approval.

Talent development, recruiting

and organizational health have been a critical focus of the Company.

A number of high-quality individuals have joined the Company, each

of whom bring extensive experience in their respective fields.

We have bolstered our Senior Management with the recruitment of Erez Ben-Zvi,

a highly experienced MedTech development professional who joined us last year as Vice President of Product, and recently took on the

additional role of General Manager, and Shalom Shushan, a seasoned executive who joined us as Chief Technology Officer.

PhD, who has a decorated career developing innovative medical technologies, including at DexCom and MiniMed and was a member of the Board

of Directors of the Company, was appointed as President and Chief Operating Officer.

Malavé, formerly of Insulet Corp,

Medtronic and MiniMed has joined as an independent board member.

Several highly talented and accomplished executives joined the Company

as senior advisors to the Board.

These include Yair Briman, the former CEO of Philips Healthcare Informatics, Daniel McCaffrey MBA MA,

a world-renowned behavioral scientist and digital health expert currently at Samsung Health and formerly of Dexcom, Dr.

Alexander Raykhman

PhD, a measurement and artificial intelligence expert and Dr.

Klonoff, world renowned endocrinologist and diabetes technology

thought leader.

We intend to continue to invest in our talent and to expand and strengthen all areas within the company.

the Company performed a top-down analysis of the GlucoTrack 1.0 model to identify areas of potential enhancement, as it relates to the

platform, integrations, sensor technologies, accuracy as well as manufacturing costs.

The result of this

comprehensive review is an accelerated development plan for GlucoTrack 2.0.

GlucoTrack 2.0 will be a completely wireless and rechargeable

earclip to be paired with a smartphone, with more capabilities and features, increased accuracy, significantly greater margins for the

Company and lower cost to the end-user as compared to GlucoTrack 1.0.

previously reported, the Company has made significant progress towards receiving insurance reimbursement in the Netherlands.

new accelerated development plan for GlucoTrack 2.0, and all of the expected advantages over GlucoTrack 1.0, it became

clear to the Company that introducing GlucoTrack 2.0 rather than the GlucoTrack 1.0 would serve the diabetes market and the Company more

We are currently working with our European partners on the roadmap for distribution of GlucoTrack 2.0 when completed and

ready to market.

addition to the European markets, the Company is now focused on the U.S.

market as well, including building out its U.S.

go-to-market strategy and planning the

required FDA clinical trials and field testing to support its entrance into the market.

The Company is currently in the process of identifying

clinical sites in the U.S., interviewing Contract Research Organizations (CRO’s), and forming its Scientific and Medical Advisory

strategy and planning the required FDA clinical trials and field testing to support its entrance into the market.

The Company is currently

in the process of identifying clinical sites in the U.S., interviewing Contract Research Organizations (CRO’s), and forming its

Scientific and Medical Advisory Boards.

We intend to build out a team to support the U.S.

activities, while continuing our technology development in our R&D facility

located in Israel.

activities while continuing our technology

development in our R&D facility located in Israel.

October 19, 2021, Paul V.

Goode was appointed as President and Chief Operating Officer of Integrity Applications, Inc.

(the “Company”),

effective November 1, 2021 (“Effective Date”).

He has served as a member of Integrity’s Board of Directors since December

Concurrent with his new appointment, Mr.

Goode will be stepping down from the Board.

In this role, Goode will lead the company’s

operations, overseeing strategy, design, manufacturing, business and product development and begin to build the U.S.

infrastructure in

preparation for the U.S.

clinical trials of GlucoTrack.

He will devote such time as necessary to perform his duties but shall be able

to pursue other professional opportunities at the same time.

His base salary shall be $175,000 per year, and he shall be entitled to

a cash bonus of up to 20% of his annual base salary as determined by the Company’s Compensation Committee and shall be granted

options to purchase up to One and half Percent (1.5%) of the fully diluted common stock, par value $0.001 per share, of the Company (“Common

Stock”) as of the Effective Date, with a per share exercise price equal to the greater of (A) $5.20 per share or (B) the closing

price of a share of Common Stock on the Effective Date, as reported by Bloomberg L.P., which shall vest in equal monthly installments

over a three year period following the Effective Date.

The bonus and equity incentives shall be subject to clawback rights if there is

a misstatement of financials which changes any metrics upon which a bonus or incentives are based and the clawback will be pro rata based

upon the changes in the financials with respect to the effect on any underlying metrics.

may be at risk as a result of the current COVID-19 pandemic.

4 unchanged sentences

the length of time of the COVID-19 pandemic and the possibility of its reoccurrence;

the timing required to develop effective

treatments and a vaccine in the event of future outbreaks;

the eventual impact of the pandemic and actions taken in response to the pandemic

on global and regional economies;

the timing required to develop

effective treatments and a vaccine in the event of future outbreaks;

the eventual impact of the pandemic and actions taken in response

to the pandemic on global and regional economies;

and the pace of recovery when the COVID-19 pandemic subsides.

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of Operations

following discussion of our operating results explains material changes in our results of operations for the three and six months period

ended June 30, 2021 compared with the same period ended June 30, 2020.

The discussion should be read in conjunction with the financial

statements and related notes included elsewhere in this report.

Months ended June 30, 2021 compared to Three Months ended June 30, 2020

the three-month period ended June 30, 2021, we had no revenues.

following discussion of our operating results explains material changes in our results of operations for the three and nine months period

ended September 30, 2021 compared with the same period ended September 30, 2020.

The discussion should be read in conjunction with the

financial statements and related notes included elsewhere in this report.

Months ended September 30, 2021 compared to Three Months ended September 30, 2020

the three-month period ended September 30, 2021, we had no revenues.

and development expenses

and development expenses were $321 thousand for the three-month period ended June 30, 2021, as compared to $379 thousand for the prior-year

and development expenses were $447 thousand for the three-month period ended September 30, 2021, as compared to $476 thousand

for the prior-year period.

The decrease is immaterial.

5 unchanged sentences

and marketing expenses

and marketing expenses were $0 thousand for the three-month period ended June 30, 2021, as compared to $90 thousand for the prior-year

The decrease is attributable to the occurrence of no sales and marketing activities

in the second quarter of 2021 .

and marketing expenses were $113 thousand for the three-month period ended September 30, 2021, as compared to $93 thousand for

the prior-year period.

The decrease is immaterial.

and marketing expenses consist primarily of professional services, salaries, travel expenses and other related expenses.

and administrative expenses

and administrative expenses were $552 thousand for the three-month period ended June 30, 2021, as compared to $142 thousand for the prior-year

The increase is primarily attributable to hiring of new and augmented personnel to move forward our business agenda.

and administrative expenses were $207 thousand for the three-month period ended September 30, 2021, as compared to $318 thousand

for the prior-year period.

The increase is primarily attributable to hiring of new and augmented personnel to move forward our business

and administrative expenses consist primarily of professional services, salaries, travel expenses and other related expenses for executive,

3 unchanged sentences

and accounting services.

income, net was approximately $20 thousand for the three-month period ended June 30, 2021, as compared to financing income of $37 thousand

for the prior-year period.

income, net was approximately $9 thousand for the three-month period ended September 30, 2021, as compared to financing income of $40

thousand for the prior-year period.

The decrease is immaterial.

loss was $853 thousand for the three-month period ended June 30, 2021, as compared to $574 thousand for the prior-year period.

in net loss is attributable primarily to the decrease in our operating expenses, as described above.

Months ended June 30, 2021 compared to Six Months ended June 30, 2020

the six-month period ended June 30, 2021, we had no revenues.

loss was $804 thousand for the three-month period ended September 30, 2021, as compared to $509 thousand for the prior-year period.

increase in net loss is attributable primarily to one-time income in the amount of $ 338 recorded in the three-month period

ended September 30, 2020 resulting from an agreement signed with one of our suppliers.

Months ended September 30, 2021 compared to Nine Months ended September 30, 2020

the nine-month period ended September 30, 2021, we had no revenues.

and development expenses

and development expenses were $630 thousand for the six-month period ended June 30, 2021, as compared to $792 thousand for the prior-year

The decrease is immaterial.

and development expenses were $1,077 thousand for the nine-month period ended September 30, 2021, as compared to $1,268 thousand

for the prior-year period.

The decrease is attributable to a decrease in research and development as the change in management evaluates

the Company’s direction and potential move to clinical trials in the U.S.

and development expenses consist primarily of salaries and other personnel-related expenses, materials, clinical trials and other expenses.

We expect research and development expenses to increase in 2021 and beyond, primarily due to hiring additional personnel and developing

our next generation product line, however, we may adjust or allocate the level of our research and development expenses based on available

our next generation product line;

however, we may adjust or allocate the level of our research and development expenses based on available

financial resources and based on our commercial needs, including the FDA registration process, specific requirements from customers,

1 unchanged sentence

and marketing expenses

and marketing expenses were $23 thousand for the six-month period ended June 30, 2021, as compared to $181 thousand for the prior-year

The decrease is attributable to the occurrence of minimal sales and marketing activities

and marketing expenses were $136 thousand for the nine-month period ended September 30, 2021, as compared to $274 thousand for

the prior-year period.

The decrease is attributable to the occurrence of minimal sales and

marketing activities in 2021 .

and marketing expenses consist primarily of professional services, salaries, travel expenses and other related expenses.

and administrative expenses

and administrative expenses were $1,116 thousand for the six-month period ended June 30, 2021, as compared to $394 thousand for the prior-year

The increase is primarily attributable to hiring of new and augmented personnel to move forward our business agenda.

and administrative expenses were $1,323 thousand for the nine-month period ended September 30, 2021, as compared to $712 thousand

for the prior-year period.

The increase is primarily attributable to hiring of new and augmented personnel to move forward our business

and administrative expenses consist primarily of professional services, salaries, travel expenses and other related expenses for executive,

3 unchanged sentences

and accounting services.

expenses, net was approximately $12 thousand for the six-month period ended June 30, 2021, as compared to financing income of $59 thousand

for the prior-year period.

The decrease is immaterial.

loss was $1,757 thousand for the six-month period ended June 30, 2021, as compared to $1,308 thousand for the prior-year period.

increase in net loss is attributable primarily to the decrease in our operating expenses, as described above.

income, net was approximately $21 thousand for the nine-month period ended September 30, 2021, as compared to financing income of $99

thousand for the prior-year period.

The decrease is due to lower interest rates on savings accounts.

loss was $2,561 thousand for the nine-month period ended September 30, 2021, as compared to $1,817 thousand for the prior-year period.

The increase in net loss is attributable primarily to one-time income in the amount of $ 338 recorded in the nine-month period

ended September 30, 2020 resulting from an agreement signed with one of our suppliers.

and Capital Resources

of June 30, 2021, cash on hand was approximately $8 million as a result of our $15 million private placement which closed during February

2020, for which we received net cash of approximately $13 million.

Based on our current cash burn rate, strategy and operating plan,

we believe that our cash and cash equivalents will enable us to operate for a period in excess of one year from the date of this report.

In order to fund our anticipated liquidity needs beyond such period (or possibly earlier if our current cash burn rate, strategy or operating

plan change in a way that accelerates or increases our liquidity needs), we will need to raise additional capital.

Cash Used in Operating Activities for the Six-Month Periods Ended June 30, 2021 and June 30, 2020

cash used in operating activities was $1,902 thousand and $1,892 thousand for the six-month periods ended June 30, 2021 and 2020, respectively.

Net cash used in operating activities primarily reflects the net loss for those periods of $1,757 thousand and $1,308 thousand, respectively.

Cash Used in Investing Activities for the Six-Month Periods Ended June 30, 2021 and June 30, 2020

cash used (provided) in investing activities was $(3) and $15 thousand for the six-month periods ended June 30, 2021 and 2020, respectively,

and was used mostly to purchase equipment (such as computers, research and development, and office equipment).

Cash Provided by Financing Activities for the Six-Month Periods Ended June 30, 2021 and June 30, 2020

cash provided by financing activities was $0 and $13,009 thousand for the six-month periods ended June 30, 2021 and 2020, respectively.

Cash provided by financing activities for the three-month period ended June 30, 2020 reflected net capital raised from the February 2020

of September 30, 2021, cash on hand was approximately $7 million as a result of our $15 million private placement which closed during

February 2020, for which we received net cash of approximately $13 million.

Based on our current cash burn rate, strategy and operating

plan, we believe that our cash and cash equivalents will enable us to operate for a period in excess of one year from the date of this

In order to fund our anticipated liquidity needs beyond such period (or possibly earlier if our current cash burn rate, strategy

or operating plan change in a way that accelerates or increases our liquidity needs), we will need to raise additional capital.

September 27, 2021, the Company’s shelf registration statement on Form S-3 (file no.

333-259664) was declared effective by the

The shelf registration statement permits the Company to register up to $100,000,000 of certain equity and debt securities

of the Company via prospectus supplement.

Cash Used in Operating Activities for the Nine-Month Periods Ended September 30, 2021 and September 30, 2020

cash used in operating activities was $2,796 thousand and $2,657 thousand for the nine-month periods ended September 30, 2021 and 2020,

respectively.

Net cash used in operating activities primarily reflects the net loss for those periods of $2,561 thousand and $1,817 thousand,

respectively.

Cash Used in Investing Activities for the Nine-Month Periods Ended September 30, 2021 and September 30, 2020

cash used (provided) in investing activities was $(3) and $46 thousand for the nine-month periods ended September 30, 2021 and 2020,

respectively, and was used mostly to purchase equipment (such as computers, research and development, and office equipment).

Cash Provided by Financing Activities for the Nine-Month Periods Ended September 30, 2021 and September 30, 2020

cash provided by financing activities was $0 and $13,009 thousand for the nine-month periods ended September 30, 2021 and 2020, respectively.

Cash provided by financing activities for the nine-month period ended September 30, 2020 reflected net capital raised from the February

2020 private placement and issuance of our common stock.

Sheet Arrangements

of June 30, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

of September 30, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Quantitative and Qualitative Disclosures About Market Risk.

1 unchanged sentence

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