What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-08-11 compared with 2022-05-12 · 228 added, 178 removed, 369 unchanged (52% of the section changed)

19 unchanged sentences

Forward-looking statements include statements about:

timing of and our ability to obtain and maintain regulatory clearance of our cortical strip, grid and depth electrode technology, including

our ability to obtain 510(k) clearance for use of its Evo sEEG electrode technology for less than 30 days;

ability to successfully commercialize our technology in the United States;

ability to achieve or sustain profitability;

ability to raise additional capital and to fund our operations;

results of our development and distribution relationship with Zimmer, Inc.

availability of additional capital on acceptable terms or at all as or when needed;

clinical utility of our cortical strip, grid and depth electrode including technology under development;

ability to develop additional applications of our cortical strip, grid and depth electrode technology with the benefits we hope to offer

as compared to existing technology, or at all;

performance, productivity, reliability and regulatory compliance of our third party manufacturers of our cortical strip, grid electrode

and depth electrode technology;

ability to develop future generations of our cortical strip, grid and depth electrode technology;

future development priorities;

impact of the COVID-19 pandemic and resulting macroeconomic conditions, including supply chain disruptions, labor shortages and inflationary

pressures, on our business;

ability to obtain reimbursement coverage for our cortical strip, grid and depth electrode technology;

expectations about the willingness of healthcare providers to recommend our cortical strip, grid and depth electrode technology to people

with epilepsy, Parkinson’s disease, dystonia, essential tremors, chronic pain due to failed back surgeries and other related neurological

future commercialization, marketing and manufacturing capabilities and strategy;

ability to comply with applicable regulatory requirements;

ability to maintain our intellectual property position;

outcome of legal proceedings with PMT Corporation (“PMT”);

expectations regarding international opportunities for commercializing our cortical strip, grid and depth electrode technology under

including technology under development;

estimates regarding the size of, and future growth in, the market for our technology, including technology under development;

estimates regarding our future expenses and needs for additional financing.

the timing of and our ability

to obtain and maintain regulatory clearance of our cortical strip, grid and depth electrode technology, including our ability to

obtain 510(k) clearance for use of its Evo sEEG electrode technology for less than 30 days;

our ability to successfully

commercialize our technology in the United States;

our ability to achieve

or sustain profitability;

our ability to raise additional

capital and to fund our operations;

the results of our development

and distribution relationship with Zimmer, Inc.

the availability of additional

capital on acceptable terms or at all as or when needed;

the clinical utility of

our cortical strip, grid and depth electrode including technology under development;

our ability to develop

additional applications of our cortical strip, grid and depth electrode technology with the benefits we hope to offer as compared

to existing technology, or at all;

the performance, productivity,

reliability and regulatory compliance of our third party manufacturers of our cortical strip, grid electrode and depth electrode

our ability to develop

future generations of our cortical strip, grid and depth electrode technology;

our future development

the impact of the COVID-19

pandemic and macroeconomic conditions, including supply chain disruptions, labor shortages and inflationary pressures, on our business;

our ability to obtain reimbursement

coverage for our cortical strip, grid and depth electrode technology;

our expectations about

the willingness of healthcare providers to recommend our cortical strip, grid and depth electrode technology to people with epilepsy,

Parkinson’s disease, dystonia, essential tremors, chronic pain due to failed back surgeries and other related neurological

NeuroOne Medical Technologies Corporation

our future commercialization,

marketing and manufacturing capabilities and strategy;

our ability to comply with

applicable regulatory requirements;

our ability to maintain

our intellectual property position;

the outcome of legal proceedings

with PMT Corporation (“PMT”);

our expectations regarding

international opportunities for commercializing our cortical strip, grid and depth electrode technology under including technology

under development;

our estimates regarding

the size of, and future growth in, the market for our technology, including technology under development;

our estimates regarding

our future expenses and needs for additional financing.

Forward-looking

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of DBS are reversible.

NeuroOne Medical Technologies Corporation

ablation is a procedure that uses radiofrequency under the electrode contacts which is directed to the site of the brain tissue that

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if it has biocompatibility data it believes can show its device to be substantially equivalent.

Company filed an appeal of this decision to a higher level within the FDA, which places the submission on hold until a decision is made.

This process may take up to 60 days from date of the appeal before an FDA decision is reached.

Company filed an appeal of this decision to a higher level within the FDA, which placed the submission on hold until a decision was made.

In a letter to the Company dated May 13, 2022, the FDA stated that they were upholding their decision that the device is not substantially

equivalent for extended use based on their analysis of the methodology used for exhaustive extraction testing.

FDA also stated that the Company may submit a new 510(k) with new evidence, specifically as it relates to the subacute toxicity endpoint,

to support a finding of substantial equivalence.

The Company is in the process of collecting such data and intends to submit a Special

510(k) which according to FDA guidance is processed within 30 days of receipt, rather than the 90 days for a traditional 510(k).

Company expects to resubmit the application to the FDA in August 2022.

Company has stated previously that it expected to be commercial ready with the Evo sEEG electrode in the first calendar quarter of 2022

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have incurred losses since inception.

As of March 31, 2022, we had an accumulated deficit of $46.7 million, primarily as a result of

expenses incurred in connection with our research and development, selling, general and administrative expenses associated with our operations

As of June 30, 2022, we had an accumulated deficit of $49.5 million, primarily as a result of expenses

incurred in connection with our research and development, selling, general and administrative expenses associated with our operations

and interest expense, fair value adjustments and loss on extinguishments related to our debt, offset in part by collaborations and product

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or partnerships with other companies or other sources.

NeuroOne Medical Technologies Corporation

may be unable to raise additional funds when needed on favorable terms or at all.

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Developments and Upcoming Milestones

November 2021, the Company submitted a request to the FDA seeking a 510(k) clearance for use of its Evo sEEG electrode technology for

less than 30 days.

On March 11, 2022, the Company received a letter via email from the FDA that the FDA had denied the Company’s

510(k) application based on a finding of non-substantial equivalence based on their analysis of the methodology used for exhaustive extraction

The FDA letter stated the Company has not demonstrated that the sEEG Electrode for less than 30-day use is substantially equivalent

to the predicate device (sEEG Electrode for less than 24 hours K211367).

The FDA also stated that the Company may re-submit a new 510(k)

if it has biocompatibility data it believes can show its device to be substantially equivalent.

Company filed an appeal of this decision to a higher level within the FDA, which places the submission on hold until a decision is made.

This process may take up to 60 days from date of the appeal before an FDA decision is reached.

Company has stated previously that it expected to be commercial ready with the Evo sEEG electrode in the first calendar quarter of 2022

pending FDA clearance.

The Company now expects that additional time will be required and will continue to work with the FDA in pursuit

of 510(k) clearance.

November 2021, we submitted a request to the FDA seeking a 510(k) clearance for use of our Evo sEEG electrode technology for less than

On March 11, 2022, the FDA denied the Company’s 510(k) application based on a finding of non-substantial equivalence based

on their analysis of the methodology used for exhaustive extraction testing.

filed an appeal of this decision to a higher level within the FDA, which placed the submission on hold until a decision was made.

May 13, 2022, the FDA stated that they were upholding their decision that the device is not substantially equivalent for extended use

based on their analysis of the methodology used for exhaustive extraction testing.

We intend to submit a Special 510(k) which according

to FDA guidance is processed within 30 days of receipt, rather than the 90 days for a traditional 510(k).

We expect to resubmit the application

to the FDA in August 2022.

had stated previously that we expected to be commercial ready with the Evo sEEG electrode in the first calendar quarter of 2022 pending

FDA clearance.

We now expect that additional time will be required and will continue to work with the FDA in pursuit of 510(k) clearance.

completed feasibility bench top testing with a new design of our diagnostic and ablation depth electrode in the first calendar quarter

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University in September 2021 and additional animal studies are planned.

Subsequent to the end of the fiscal quarter, we also announced

that we have surpassed five years of accelerated aging testing for our recording electrodes.

March 11, 2020, the World Health Organization declared the outbreak of COVID-19 as a global pandemic.

COVID-19 and its variants continue

to impact the United States and the world.

As a result of the COVID-19 pandemic, the Company has experienced delays and disruptions in

our pre-clinical and clinical trials, as well as interruptions in our manufacturing, supply chain, and research and development operations.

development of our technology

has been and may continue to be delayed further into fiscal 2022 due to interruptions in global manufacturing and shipping as a result

of the COVID-19 pandemic and macroeconomic conditions, including as one of our key manufacturing partners and one of the Company’s

suppliers had staffing issues leading to delays in the Company’s development builds and delays in shipping product;

the Company’s own

staff has been impacted by infections and mandatory quarantines;

the Company is currently

experiencing and may continue to experience product shortages of its primary component, polyimide film, due to supply chain shortages

attributed to COVID related issues;

the Company is experiencing

and may continue to experience delays in timelines for product availability and delivery from vendors, including related to staffing

shortages, both generally and due to employee illness, and due to increases in demand from other larger or more longstanding customers

of our suppliers placing large orders due to concerns with supply chain disruption and the impact of COVID-19.

Company’s plans for further testing or clinical trials and costs to obtain components may be further impacted by the continuing

effects of COVID-19, supply chain challenges and inflationary pressures.

global outbreak of COVID-19 continues to rapidly evolve as new variants emerge.

The extent to which the COVID-19 pandemic may impact

our business and pre-clinical and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted

with confidence, such as the effect of the pandemic on our suppliers and distributors and the global supply chain, the impact of inflation,

the ultimate geographic spread of the disease and its variants, the duration of the outbreak, travel restrictions and social distancing

and other countries, business closures or business disruptions and the effectiveness of actions taken in the U.S.

countries to contain and treat the disease.

COVID-19 pandemic may also impact our ability to secure additional financing.

Although the Company cannot estimate the length or gravity

of the impact of the COVID-19 outbreak at this time, if the pandemic continues, it may have a material adverse effect on the Company’s

results of future operations, financial position, and liquidity in the remainder of fiscal year 2022 and beyond.

During the fiscal quarter, we also announced that we have surpassed

five years of accelerated aging testing for our recording electrodes.

We continue to develop our Chronic Use electrodes and remain focused

on developing a system for the treatment of chronic back pain due to failed back surgeries that provides the capabilities of recording

and stimulation in a thin film electrode technology.

We recently established a physician advisory board comprised of leading anesthesiologists

and neurosurgeons that have extensive experience with implanting these systems.

In our fiscal fourth quarter, we will convene the group

to begin to develop the framework of a desired feature set customized to the advantages of our electrode technology.

Economic Conditions

COVID-19 pandemic that began around December 2019 introduced significant volatility to the global economy, disrupted supply chains and

had a widespread adverse effect on the financial markets.

The development of our technology was delayed in the first quarter due to interruptions

in global manufacturing and shipping as a result of the COVID-19 pandemic.

Additionally, our own staff has been impacted by infections

and mandatory quarantines.

Testing and clinical trials, manufacturing, component supply, shipping and research and development operations may

be further impacted by the continuing effects of COVID-19.

lingering impacts of COVID-19 throughout 2021 and into 2022 have impeded global supply chains and resulted in inflationary cost increases.

These broad-based inflationary impacts have increased the manufacturing costs of our products and product candidates.

We expect these

inflationary impacts to continue for the foreseeable future,

addition to the direct and indirect impacts of COVID-19, the United States and global markets are experiencing volatility and disruption

following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine.

In February 2022,

Russia launched a full-scale military invasion of Ukraine.

As a result of the conflict, the United States, United Kingdom, European Union

and other countries have levied economic sanctions and bans on Russia and Russia has responded with its own retaliatory measures.

These measures

have contributed to significant volatility and negative pressure in financial markets, and could have a lasting impact on regional and

global economies, and may have a material adverse effect on our results of future operations, financial position, and liquidity for the

duration of fiscal year 2022 and beyond.

NeuroOne Medical Technologies Corporation

product revenue was derived from the sale of strip/grid, depth electrode and electrode cable assembly products based on Evo cortical

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from the sale of prototype products and related materials are offset against research and development expenses.

NeuroOne Medical Technologies Corporation

expect our research and development expenses to significantly increase over the next several years as we develop our cortical strip,

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of Operations

of the Three Months Ended March 31, 2022 and 2021

following table sets forth the results of operations for the three-months ended March 31, 2022 and 2021, respectively.

three months ended

of product revenue

gross profit (loss)

Collaborations

general and administrative

and development

of the Three Months Ended June 30, 2022 and 2021

following table sets forth the results of operations for the three months ended June 30, 2022 and 2021, respectively.

For the Three Months Ended

June 30, (unaudited)

Product revenue

Cost of product revenue

Product gross profit (loss)

Collaborations revenue

Operating expenses:

from operations

before income taxes

for income taxes

Selling, general and administrative

Research and development

Total operating expenses

Loss from operations

Loss before income taxes

Provision for income taxes

$ (2,759,727 )

$ (2,951,609 )

NeuroOne Medical Technologies Corporation

Revenue and Product Gross Profit (Loss)

revenue and product gross profit (loss) was $37,000 and $(36,000), respectively, during the three months ended March 31, 2022.

revenue and product gross profit (loss) was $18,000 and $(21,000), respectively, during the three months ended March 31, 2021.

revenue during the second quarter of 2022 related to the sale of our Strip/Grid Products and Electrode Cable Assembly Products.

of product revenue consisted of the manufacturing and materials costs incurred by our third-party contract manufacturer in connection

with our Strip/Grid Products and outside supplier materials costs in connection with the Electrode Cable Assembly Products.

cost of product revenue included royalty fees incurred in connection with our license agreements.

Product revenue and product gross profit (loss)

was $32,000 and $(6,000), respectively, during the three months ended June 30, 2022.

Product revenue and product gross profit (loss) was

$40,000 and $(22,000), respectively, during the three months ended June 30, 2021.

The product revenue during the second quarter of 2022

related to the sale of our Strip/Grid Products and Electrode Cable Assembly Products.

Cost of product revenue consisted of the manufacturing

and materials costs incurred by our third-party contract manufacturer in connection with our Strip/Grid Products and outside supplier

materials costs in connection with the Electrode Cable Assembly Products.

In addition, cost of product revenue included royalty fees incurred

in connection with our license agreements.

Collaborations

revenue was $20,000 for the three months ended March 31, 2021.

revenue was $17,000 for the three months ended June 30, 2021.

Revenue during the prior year period was derived from the Zimmer Development

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There was no collaborations revenue recognized during the three

months ended March 31, 2022.

months ended June 30, 2022.

general and administrative expenses

general and administrative expenses were $1.8 million for the three months ended March 31, 2022, compared to $1.3 million for the three

months ended March 31, 2021.

The $0.5 million increase was primarily due to investor relations costs of $0.3 million, litigation support

and other legal costs of $0.2 million and sales and marketing expenses of $0.1 million, offset in part by a decrease in administrative

personnel expenses of $0.1 million.

general and administrative expenses were $1.5 million for the three months ended June 30, 2022, compared to $2.1 million for the three

months ended June 30, 2021.

The $0.6 million decrease was primarily due to a decrease in stock-based compensation expense of $0.6 million

and sales and marketing expenses of $0.1 million, offset in part by an increase in legal and public company costs of $0.1 million.

and development expenses

and development expenses were $1.2 million for the three months ended March 31, 2022, compared to $1.1 million during for the three months

ended March 31, 2021.

and development expenses were $1.2 million for the three months ended June 30, 2022, compared to $0.9 million during for the three months

ended June 30, 2021.

The $0.3 million increase period over period was attributed to supporting development activities, which primarily

included salary-related expenses and costs related to consulting services, materials and supplies associated with the development of

SEEG Products and to a lesser extent Strip/Grid Products.

income during the three months ended March 31, 2022 related to interest income on our cash deposits in the amount of $2,000.

during the three months ended March 31, 2021 consisted of proceeds from the sale of certain supplies in the amount of $2,000.

of the Six Months Ended March 31, 2022 and 2021

following table sets forth the results of operations for the six months ended March 31, 2022 and 2021, respectively.

six months ended

of product revenue

gross profit (loss)

Collaborations

general and administrative

and development

SEEG Products.

income during the three months ended June 30, 2022 related to interest income on our cash deposits in the amount of $2,000.

during the three months ended June 30, 2021 was attributed to the forgiveness of the U.S.

Small Business Administration Paycheck Protection

Program loan in the amount of $0.1 million.

NeuroOne Medical Technologies Corporation

of the Nine Months Ended June 30, 2022 and 2021

following table sets forth the results of operations for the nine months ended June 30, 2022 and 2021, respectively.

For the Nine Months Ended

June 30, (unaudited)

Product revenue

Cost of product revenue

Product gross profit (loss)

Collaborations revenue

Operating expenses:

from operations

valuation change of instruments measured at fair value

before income taxes

for income taxes

Selling, general and administrative

Research and development

Total operating expenses

Loss from operations

Interest expense

Net valuation change of instruments measured at fair value

Loss before income taxes

Provision for income taxes

$ (8,625,269 )

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Revenue and Product Gross Profit (Loss)

revenue and product gross profit (loss) was $70,000 and $(49,000) during the six months ended March 31, 2022, respectively.

Product revenue

and product gross profit (loss) was $90,000 and $(59,000) during the six months ended March 31, 2021, respectively.

The product revenue

consisted of Strip/Grid Products and Electrode Cable Assembly Products sales.

Cost of product revenue consisted of the manufacturing

and materials costs incurred by our third-party contract manufacturer in connection with our Strip/Grid Products and outside supplier

materials costs in connection with the Electrode Cable Assembly Products.

In addition, cost of product revenue included royalty fees

incurred in connection with our license agreements.

Product revenue and product gross profit (loss)

was $102,000 and $(56,000) during the nine months ended June 30, 2022, respectively.

Product revenue and product gross profit (loss) was

$130,000 and $(81,000) during the nine months ended June 30, 2021, respectively.

The product revenue consisted of Strip/Grid Products

and Electrode Cable Assembly Products sales.

Cost of product revenue consisted of the manufacturing and materials costs incurred by our

third-party contract manufacturer in connection with our Strip/Grid Products and outside supplier materials costs in connection with the

Electrode Cable Assembly Products.

In addition, cost of product revenue included royalty fees incurred in connection with our license

Collaborations

revenue was $6,000 and $42,000 for the six months ended March 31, 2022 and 2021, respectively.

revenue was $6,000 and $60,000 for the nine months ended June 30, 2022 and 2021, respectively.

Revenue during the period was derived

from the Zimmer Development Agreement and represented the portion of the upfront initial development fee payment eligible for revenue

recognition during these six month periods.

recognition during these nine month periods.

The amount of revenue recognized related to the upfront fee was based on development completed

in connection with SEEG Products, and to a lesser extent, the Strip/Grid Products.

NeuroOne Medical Technologies Corporation

general and administrative expenses

general and administrative expenses were $3.6 million for the six months ended March 31, 2022, compared to $2.5 million for the six months

ended March 31, 2021.

The $1.1 million increase was primarily due to higher investor relations costs of $0.3 million, litigation support

and other legal costs $0.5 million, sales and marketing expenses of $0.1 million and insurance and other operating expenses and fees

of $0.2 million.

general and administrative expenses were $5.1 million for the nine months ended June 30, 2022, compared to $4.6 million for the nine

months ended June 30, 2021.

The $0.5 million increase was primarily due to higher investor relations costs of $0.4 million, litigation

support and other legal costs $0.5 million, sales and marketing expenses of $0.1 million and insurance and other operating expenses and

fees of $0.2 million, offset in part by stock-based compensation of $0.7 million.

and development expenses

and development expenses were $2.3 million for the six months ended March 31, 2022, compared to $2.0 million for the six months ended

March 31, 2021.

and development expenses were $3.5 million for the nine months ended June 30, 2022, compared to $2.9 million for the nine months ended

June 30, 2021.

The $0.6 million increase period over period was attributed to supporting development activities, which primarily included

salary-related expenses and costs related to consulting services, materials and supplies associated with the development of SEEG Products.

and to a lesser extent Strip/Grid Products.

expense for the six months ended March 31, 2021 was $3,000 and consisted of issuance costs in connection the 2019 Paulson Notes.

not incur interest expense during the current six month period.

expense for the nine months ended June 30, 2021 was $3,000 and consisted of issuance costs in connection the 2019 Paulson Notes.

not incur interest expense during the current nine month period ended June 30, 2022.

valuation change of instruments measured at fair value:

net valuation change of instruments measured at fair value for the six months ended March 31, 2021 was a benefit of $2,000 related to

net valuation change of instruments measured at fair value for the nine months ended June 30, 2021 was a benefit of $2,000 related to

the 2019 Paulson Notes that were measured at fair value.

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while outstanding.

There was no net valuation change of instruments measured at fair value during the six month period ended March 31,

There was no net valuation change of instruments measured at fair value during the nine month period ended June 30,

2022 as there were no instruments measured at fair value during the current year period.

income during the six months ended March 31, 2022 consisted of $4,000 related primarily to interest income attributed to our cash deposits.

income during the six months ended March 31, 2021 consisted principally of proceeds received in connection with the PMT Corporation litigation

in the amount of $0.2 million and proceeds received from the sale of certain supplies in the amount of $2,000.

income during the nine months ended June 30, 2022 consisted of $5,000 related primarily to interest income attributed to our cash deposits.

income during the nine months ended June 30, 2021 consisted principally of proceeds received in connection with the PMT Corporation litigation

in the amount of $0.2 million and the forgiveness of the U.S.

Small Business Administration Paycheck Protection Program loan in the amount

of $0.1 million.

and Capital Resources

of March 31, 2022, our principal source of liquidity consisted of cash deposits of $12.9 million.

While we began to generate revenue

in fiscal year 2021 from commercial sales and through milestone payments under our collaboration with Zimmer, we expect to continue to

incur significant expenses and increasing operating and net losses for the foreseeable future until and unless we generate an adequate

level of revenue from commercial sales to cover expenses.

Our most significant cash requirements relate to the funding of our ongoing

product development and commercialization operations and our royalty obligations under our intellectual property licenses with the Wisconsin

of June 30, 2022, our principal source of liquidity consisted of cash deposits of $10.2 million.

While we began to generate revenue in

fiscal year 2021 from commercial sales and through milestone payments under our collaboration with Zimmer, we expect to continue to incur

significant expenses and increasing operating and net losses for the foreseeable future until and unless we generate an adequate level

of revenue from commercial sales to cover expenses.

Our most significant cash requirements relate to the funding of our ongoing product

development and commercialization operations and our royalty obligations under our intellectual property licenses with the Wisconsin

Alumni Research Foundation (“WARF”) and the Mayo Foundation for Medical Education and Research (“Mayo”).

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hire additional staff, add operational, financial and management systems and continue to operate as a public company.

NeuroOne Medical Technologies Corporation

sources of cash to date have been limited collaboration and product revenues and proceeds from the issuances of notes with warrants,

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for the WARF License, the royalty rate will be tripled for the remaining term of the WARF License.

NeuroOne Medical Technologies Corporation

the Amended and Restated License and Development Agreement with Mayo (the “Mayo Development Agreement”), we have agreed to

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and the timing of expected future payments.

Contracted services include agreements with third-party service providers for clinical research,

product development, manufacturing, supplies, payroll services, equipment maintenance services, and audits for periods up to fiscal 2023.

Contracted services include agreements with third-party service providers for clinica l

research, product development, manufacturing, supplies, payroll services, equipment maintenance services, and audits for periods up to

expect to satisfy our short-term and long-term obligations through cash on hand and, until we generate an adequate level of revenue from

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under the Zimmer Development Agreement could have a material adverse impact on our financial and operating results.

March 31, 2022, we had approximately $12.9 million in cash deposits.

June 30, 2022, we had approximately $10.2 million in cash deposits.

Management has noted the existence of substantial doubt about our

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We cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.

NeuroOne Medical Technologies Corporation

following is a summary of cash flows for each of the periods set forth below.

six Months Ended

cash used in operating activities

Nine Months Ended

Net cash used in operating activities

$ (8,537,351 )

$ (6,573,520 )

cash used by investing activities

cash provided by financing activities

increase in cash

Net cash used in investing activities

Net cash provided by financing activities

Net increase in cash

cash used in operating activities

cash used in operating activities was $5.9 million for the six months ended March 31, 2022, which consisted of a net loss of $5.9 million

cash used in operating activities was $8.5 million for the nine months ended June 30, 2022, which consisted of a net loss of $8.6 million

partially offset principally by non-cash stock-based compensation, depreciation, amortization related to intangible assets, operating

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The change in operating assets and

liabilities was primarily attributable to a net decrease in accrued expenses and to an increase in inventory and prepaid expenses attributed

to both the timing of payments and the timing of product sales.

cash used in operating activities was $4.3 million for the six months ended March 31, 2021, which consisted of a net loss of $4.4 million

liabilities was primarily attributable to a net decrease in accounts payable and accrued expenses and to an increase in inventory and

prepaid expenses attributed to both the timing of payments and the timing of product sales.

cash used in operating activities was $6.6 million for the nine months ended June 30, 2021, which consisted of a net loss of $7.3 million

partially offset principally by non-cash stock-based compensation, depreciation, amortization related to intangible assets, revaluation

of convertible notes and operating lease expense, totaling approximately $0.6 million in the aggregate.

The net change in our net operating

assets and liabilities associated with fluctuations in our operating activities resulted in a cash use of approximately $0.6 million.

The change in operating assets and liabilities was primarily attributable to a net decrease in accounts payable and accrued expenses

attributed to the timing of payments.

cash used by investing activities

cash used by investing activities was $0.2 million and $2,000 during the six months ended March 31, 2022 and 2021, respectively, and

consisted of outlays for purchases of equipment in the current period six month period vs.

the purchase of furniture during the prior

six month period.

of convertible notes, operating lease expense and the forgiveness of the U.S.

Small Business Administration Paycheck Protection Program

loan, totaling approximately $1.5 million in the aggregate.

The net change in our net operating assets and liabilities associated with

fluctuations in our operating activities resulted in a cash use of $0.7 million.

The change in operating assets and liabilities was primarily

attributable to a decrease in accounts payable and accrued expenses attributed to the timing of payments coupled to a lesser extent with

an increase in accounts receivable, inventory and prepaid and other assets.

Net cash used in investing activities

Net cash used in investing activities was $0.2

million and $32,000 during the nine months ended June 30, 2022 and 2021, respectively, and consisted of outlays for purchases of property

and equipment.

cash provided by financing activities

cash provided by financing activities was $12.0 million for the six months ended March 31, 2022, which consisted of net proceeds from

cash provided by financing activities was $12.0 million for the nine months ended June 30, 2022, which consisted of net proceeds from

the October 2021 Underwritten Public Offering.

cash provided by financing activities was $11.5 million for the six months ended March 31, 2021, which consisted primarily of net proceeds

cash provided by financing activities was $11.6 million for the nine months ended June 30, 2021, which consisted primarily of net proceeds

received from the 2021 Private Placement in the amount of $11.3 million.

There were also exercises of stock options and warrants during

the six months ended March 31, 2021 resulting in additional cash proceeds of $0.2 million.

the nine months ended June 30, 2021 resulting in additional cash proceeds of $0.3 million, offset in part by deferred offering costs

Accounting Estimates

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to our condensed financial statements included in “Part 1, Item 1 – Financial Statements” in this Report.

NeuroOne Medical Technologies Corporation

these policies, the following are considered critical to an understanding of our condensed financial statements included in “Part

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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