What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-08-07 compared with 2023-05-15 · 222 added, 150 removed, 150 unchanged (71% of the section changed)

16 unchanged sentences

Important factors that could cause such differences include, but are not limited to:

history of recurring losses and negative cash flows from operating activities, significant future commitments and the uncertainty

regarding the adequacy of our liquidity to pursue our complete business objectives, and substantial doubt regarding our ability to

continue as a going concern;

need to raise additional capital to meet our business requirements in the future and such capital raising may be costly or difficult

to obtain and could dilute out stockholders’ ownership interests;

inability to secure and maintain regulatory approvals for the sale of our products;

clinical trial results or lengthy product delays in key markets;

ability to maintain compliance with the Nasdaq Capital Market listing standards;

ability to generate revenues from our products and obtain and maintain regulatory approvals for our products;

ability to adequately protect our intellectual property rights;

dependence on a single manufacturing facility and our ability to comply with stringent manufacturing quality standards;

risk that the data collected from our current and planned clinical trials may not be sufficient to demonstrate that our technology

is an attractive alternative to other procedures and products;

competition in our industry, with competitors having greater financial, technological, research and development, regulatory and clinical,

manufacturing, marketing and sales, distribution and personnel resources than we do;

of new competitors and products and potential technological obsolescence of our products;

to carry out research, development and commercialization plans;

of a key customer or supplier;

problems with our research and products and potential product liability claims;

malfunctions;

increases for supplies and components;

economic conditions;

or inadequate reimbursement by governmental and other third-party payers for our products;

federal, state and local government regulation in the United States, Europe, Israel and other foreign jurisdictions;

fact that we conduct business in multiple foreign jurisdictions, exposing us to foreign currency exchange rate fluctuations, logistical

and communications challenges, burdens and costs of compliance with foreign laws and political and economic volatility in certain

jurisdictions;

escalation of hostilities in Israel, which could impair our ability to manufacture our products;

or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated

liquidity risk.

our history of recurring

losses and negative cash flows from operating activities, significant future commitments and the uncertainty regarding the adequacy

of our liquidity to pursue our complete business objectives;

our need to raise additional

capital to meet our business requirements in the future and such capital raising may be costly or difficult to obtain and could dilute

out stockholders’ ownership interests;

an inability to secure

and maintain regulatory approvals for the sale of our products;

negative clinical trial

results or lengthy product delays in key markets;

our ability to maintain

compliance with the Nasdaq Capital Market listing standards;

our ability to generate

revenues from our products and obtain and maintain regulatory approvals for our products;

our ability to adequately

protect our intellectual property rights;

our dependence on a single

manufacturing facility and our ability to comply with stringent manufacturing quality standards;

the risk that the data

collected from our current and planned clinical trials may not be sufficient to demonstrate that our technology is an attractive

alternative to other procedures and products;

intense competition in

our industry, with competitors having greater financial, technological, research and development, regulatory and clinical, manufacturing,

marketing and sales, distribution and personnel resources than we do;

entry of new competitors

and products and potential technological obsolescence of our products;

inability to carry out

research, development and commercialization plans;

loss of a key customer

technical problems with

our research and products and potential product liability claims;

product malfunctions;

price increases for supplies

and components;

adverse economic conditions;

insufficient or inadequate

reimbursement by governmental and other third-party payers for our products;

adverse federal, state

and local government regulation in the United States, Europe, Israel and other foreign jurisdictions;

the fact that we conduct

business in multiple foreign jurisdictions, exposing us to foreign currency exchange rate fluctuations, logistical and communications

challenges, burdens and costs of compliance with foreign laws and political and economic volatility in certain jurisdictions;

the escalation of hostilities

in Israel, which could impair our ability to manufacture our products;

current or future unfavorable economic and market conditions

and adverse developments with respect to financial institutions and associated liquidity risk.

foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or

37 unchanged sentences

C-Guardians is a prospective, multicenter, single-arm, pivotal study to evaluate

the safety and efficacy of the CGuard™ Carotid Sten System when used to treat symptomatic and asymptomatic carotid artery stenosis

the safety and efficacy of the CGuard™ Carotid Stent System when used to treat symptomatic and asymptomatic carotid artery stenosis

in patients undergoing carotid artery stenting.

9 unchanged sentences

primary endpoint rate is < 11.6% and the p-value is less than 0.025.

July 23, 2021, we announced the initiation of enrollment and successful completion of the first cases of our C-Guardian trial of CGuard

There are 315 patients who are expected to be enrolled in the trial and receive CGuard EPS in the treatment of carotid artery stenosis

in symptomatic and asymptomatic patients undergoing carotid artery stenting.

We are currently continuing with the enrolment phase at

approximately 20 trial sites and expect it to be completed approximately at the end of the second quarter of 2023.

In June 2023, we completed enrollment of 315 patients across

25 trial sites in the U.S.

and Europe in our IDE clinical trial,

Additionally,

21 unchanged sentences

were organized in the State of Delaware on February 29, 2008.

Recent Developments

Private Placement

May 12, 2023, we entered into a securities purchase agreement (the “Purchase Agreement”) pursuant to which we agreed to sell

2 unchanged sentences

common stock and warrants to purchase up to an aggregate of 51,656,328 shares of common stock, consisting of Series H warrants to purchase

up to 12,914,086 shares of common stock (the “Series H Warrants”), Series I warrants to purchase up to 12,914,078 shares of

common stock (the “Series I Warrants”), Series J warrants to purchase up to 12,914,086 shares of Common Stock (the “Series

up to 12,914,086 shares of common stock (the “Series H Warrants”), Series I warrants to purchase up to 12,914,078 shares

of common stock (the “Series I Warrants”), Series J warrants to purchase up to 12,914,086 shares of Common Stock (the “Series

J Warrants”) and Series K warrants to purchase up to 12,914,086 shares of common stock (the “Series K Warrants” and

1 unchanged sentence

per Private Placement Share and associated Warrants and an offering price of $1.6326 per Pre-Funded Warrant and associated Warrants.

Pre-Funded Warrants will be immediately exercisable at an exercise price of $0.0001 per share and will not expire until exercised in full.

The Warrants will be immediately exercisable upon issuance at an exercise price of $1.3827 per share, subject to adjustment as set forth

The Warrants have a term of the earlier of (i) five years from the date of issuance and (ii) (A) in the case of the Series H

Warrants, 20 trading days following the Company’s public release of primary and secondary end points related to one year follow

up study results from the Company’s C-Guardians pivotal trial, (B) in the case of the Series I Warrants, 20 trading days following

the Company’s announcement of receipt of Premarket Approval from the Food and Drug Administration (“FDA”) for the CGuard

Prime Carotid Stent System (135 cm), (C) in the case of the Series J Warrants, 20 trading days following the Company’s announcement

of receipt of FDA approval for the SwitchGuard and CGuard Prime 80 and (D) in the case on the Series K Warrants, 20 trading days following

the end of the fourth fiscal quarter after the fiscal quarter in which the first commercial sales of the CGuard Carotid Stent System in

the United States begins.

The Warrants may be exercised on a cashless basis if there is no effective registration statement registering

the shares underlying the warrants.

Pre-Funded Warrants will be immediately exercisable at an exercise price of $0.0001 per share and will not expire until exercised in

The Warrants will be immediately exercisable upon issuance at an exercise price of $1.3827 per share, subject to adjustment as

set forth therein.

The Warrants have a term of the earlier of (i) five years from the date of issuance and (ii) (A) in the case of the

Series H Warrants, 20 trading days following the Company’s public release of primary and secondary end points related to one year

follow up study results from the Company’s C-Guardians pivotal trial, (B) in the case of the Series I Warrants, 20 trading days

following the Company’s announcement of receipt of Premarket Approval from the Food and Drug Administration (“FDA”)

for the CGuard Prime Carotid Stent System (135 cm), (C) in the case of the Series J Warrants, 20 trading days following the Company’s

announcement of receipt of FDA approval for the SwitchGuard and CGuard Prime 80 and (D) in the case on the Series K Warrants, 20 trading

days following the end of the fourth fiscal quarter after the fiscal quarter in which the first commercial sales of the CGuard Carotid

Stent System in the United States begins.

Warrants may be exercised on a cashless basis if there is no effective registration statement registering the shares underlying the Warrants.

Under the terms of the Pre-Funded Warrants and Warrants, certain of the selling stockholders may not exercise the Pre-Funded Warrants

or Warrants to the extent such exercise would cause such selling stockholder, together with its affiliates and attribution parties, to

beneficially own a number of shares of common stock which would exceed 4.99% or 9.99% of our then outstanding common stock following

such exercise, excluding for purposes of such determination common stock issuable upon exercise of the Pre-Funded Warrants or Warrants

which have not been exercised.

The Warrants may be exercised into pre-funded warrants if the selling stockholder is unable to exercise

the Warrant due to the foregoing beneficial ownership limitation or at the selling shareholder’s election.

connection with the Purchase Agreement, we entered into a registration rights agreement (the “Registration Rights Agreement”).

5 unchanged sentences

We will be obligated to pay

certain liquidated damages if we fail to file the Registration Statement when required, fails to cause the Registration Statement to be

declared effective by the SEC when required, of if we fail to maintain the effectiveness of the Registration Statement.

gross proceeds to us in respect of the Private Placement Offering are expected to be approximately $42.2 million, before deducting fees

payable to the placement agent and other offering expenses.

If the Warrants are exercised in cash in full this would result in an additional

$71.4 million of proceeds.

agreed to pay LifeSci Capital LLC, a placement fee equal to 5.6% of the aggregate gross proceeds from the closing of the Private Placement

Offering and a non-accountable expense allowance of $25,000.

In addition, we have agreed to pay Piper Sandler & Co.

a financial advisory

fee of $1.5 million and AGP/Alliance Global Partners a financial advisory fee of $250,000.

Private Placement Offering is expected to close on or about May 15, 2023, subject to satisfaction of customary closing conditions.

certain liquidated damages if we fail to file the Registration Statement when required, fails to cause the Registration Statement to

be declared effective by the SEC when required, of if we fail to maintain the effectiveness of the Registration Statement.

The Registration

Statement was subsequently filed on May 23, 2023 and declared effective on June 1, 2023.

We paid LifeSci Capital LLC, a placement fee

equal to 5.6% of the aggregate gross proceeds from the closing of the Private Placement Offering, or approximately $2.4 million, and

legal expenses of $41,600.

In addition, we paid Piper Sandler & Co.

a financial advisory fee of $1.5 million, AGP/Alliance Global

Partners a financial advisory fee of $250,000 and lead investor counsel expenses of $125,000.

Accounting Policies

5 unchanged sentences

Statements included in the Annual Report on Form 10-K for the year ended December 31, 2022.

There have not been any material changes

to such critical accounting policies since December 31, 2022.

Other than the following new accounting policies,

there have not been any material changes to such critical accounting policies since December 31, 2022.

and Cash Equivalents

consider all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents.

As of June 30, 2023, cash and cash equivalents consisted of cash, short-term deposits (up to three months from the date of deposit) and

money market funds.

As of December 31, 2022, this balance consisted solely of cash.

securities consist of debt securities.

we elected the fair value option to measure and recognize its investments in debt securities in

accordance with ASC 825, Financial Instruments as we manage our portfolio and evaluates the performance on a fair value basis.

in fair value, realized gains and losses on sales of marketable securities, are reflected in the statements of operation as finance expense

(income), net.

currency of the primary economic environment in which our operations are conducted is the U.S.

10 unchanged sentences

of Operations

months ended March 31, 2023, compared to the three months ended March 31, 2022

For the three months ended March 31, 2023, revenue increased by $56,000, or 4.7%, to $1,239,000, from $1,183,000 during the three months

ended March 31, 2022.

months ended June 30, 2023, compared to the three months ended June 30, 2022

For the three months ended June 30, 2023, revenue increased by $118,000, or 7.7%, to $1,649,000, from $1,531,000 during the three months

ended June 30, 2022.

This increase was predominantly driven by a 9.6% increase in sales of CGuard EPS from $1,505,000 during the three

months ended March 31, 2022, to $1,239,000 during the three months ended March 31, 2023.

During the second half of the quarter, our CE

mark was reinstated under the MDD directive allowing us to resume sales and shipments to the EU countries and we spent the remainder

of the quarter shipping product in order to reduce the backlog of orders that accumulated over the past few months.

We believe the quarter

over quarter increase in revenue is not representative of the real market demand for CGuard EPS, due to our inability to ship product

for the first half of the quarter.

We continue to expedite the review process for recertification under the MDR.

respect to geographical regions, the increase in revenue was primarily attributable to a $177,000 increase in Europe, for reasons mentioned

in the paragraph above, and a $13,000 increase from the Middle East.

This increase was offset by a $87,000 decrease in Latin America

and $52,000 decrease in revenue from other regions such as Australia and Asia due to the timing of shipments to our distributers.

For the three months ended March 31, 2023, gross profit (revenue less cost of revenues) increased by $251,000, or 205.6%,

to $373,000, from $122,000 during the three months ended March 31, 2022.

This increase in gross profit resulted from a decrease in write-offs

of $184,000 and a $71,000 increase in revenues (as mentioned above), less the associated related material and labor.

Gross margin (gross

profits as a percentage of revenue) increased to 30.1% during the three months ended March 31, 2023 from 10.3% during the three months

ended March 31, 2022, driven by the factors mentioned above.

months ended June 30, 2022, to $1,649,000 during the three months ended June 30, 2023.

This sales increase was mainly due to growth in

existing markets.

respect to geographical regions, the increase in revenue was primarily attributable to a $63,000 increase in Asia, a $53,000 increase

in Latin America and a $13,000 increase in other geographies, for reasons mentioned in the paragraph above.

increase was offset by a $11,000 decrease in Europe.

For the three months ended June 30, 2023, gross profit (revenue less cost of revenues) increased by $60,000, or 14.0%, to

$491,000, from $431,000 during the three months ended June 30, 2022.

This increase in gross profit resulted from a $90,000 increase in

revenues (as mentioned above), less the associated related material and labor offset by $30,000 in miscellaneous expenses.

Gross margin (gross profits as a percentage of revenue) increased to 29.8% during the three months ended June 30, 2023, from 28.1% during

the three months ended June 30, 2022, driven by the factors mentioned above.

and Development Expenses .

For the three months ended March 31, 2023, research and development expenses increased by $163,000, or

9.7%, to $1,843,000, from $1,680,000 during the three months ended March 31, 2022.

This increase resulted primarily from an increase

of $170,000 in expenses related to the CGuard Prime regulatory and approval process and an increase of $88,000 in miscellaneous expenses

offset, in part, by a decrease of $95,000 in expenses related to the C-Guardians FDA study.

For the three months ended June 30, 2023, research and development expenses decreased by $63,000, or 3.1%,

to $1,993,000, from $2,056,000 during the three months ended June 30, 2022.

This decrease resulted primarily from a decrease of $261,000

in expenses related to the C-Guardians FDA study, offset, in part, by an increase of $132,000 in compensation expenses, and an increase

of $66,000 in miscellaneous expenses.

and Marketing Expenses .

For the three months ended March 31, 2023, selling and marketing expenses increased by $42,000, or 5.6%,

to $788,000, from $746,000 during the three months ended March 31, 2022.

This increase resulted primarily from an increase in compensation

expenses of $49,000 offset, in part, by a decrease of $7,000 in miscellaneous expenses.

For the three months ended June 30, 2023, selling and marketing expenses decreased by $94,000, or 9.5%, to

$892,000, from $986,000 during the three months ended June 30, 2022.

This decrease resulted primarily from a decrease in compensation

expenses of $104,000 offset, in part, by an increase of $10,000 in miscellaneous expenses.

and Administrative Expenses .

For the three months ended March 31, 2023, general and administrative expenses decreased by $59,000,

or 2.7%, to $2,123,000, from $2,182,000 during the three months ended March 31, 2022.

This decrease resulted primarily from a decrease

in share-based compensation-related expenses of $310,000 as no new grants were made from the fourth quarter of 2021 through March 31,

2023 offset, in part, by an increase in regulatory expenses of $171,000 related to MDR registration process and an increase of $80,000

in miscellaneous expenses.

For the three months ended March 31, 2023, financial income increased by $120,000, to $125,000, from $5,000 during the three

months ended March 31, 2022.

For the three months ended June 30, 2023, general and administrative expenses increased by $851,000,

or 41.1%, to $2,921,000, from $2,070,000 during the three months ended June 30, 2022.

This increase resulted primarily from an increase

in compensation expenses of $457,000, mainly due to an increase of approximately $257,000 of share-based compensation-related expenses

due to the expense recognition of grants made during the second quarter of 2023 and an increase in salary expenses and related accruals

of $208,000 mainly due to hiring of a General Manager of North America and VP of Global Marketing, an increase of legal expenses

of $219,000 and an increase of $175,000 in miscellaneous expenses.

For the three months ended June 30, 2023, financial income increased by $193,000, to $238,000, from $45,000 during the three

months ended June 30, 2022.

The increase in financial income primarily resulted from a $211,000

increase in interest income from short-term bank deposits .

For the three months ended March 31, 2023, there was no change in our tax expenses as compared to the three months ended

March 31, 2022.

Our net loss decreased by $225,000, or 5.0%, to $4,256,000, for the three months ended March 31, 2023, from $4,481,000 during

the three months ended March 31, 2022.

The decrease in net loss resulted primarily from an increase of $251,000 in gross profit and an

increase of $120,000 in financial income partially offset by an increase of $146,000 in operating expenses.

increase in interest income from investment in marketable securities, money market funds and short-term bank deposits .

For the three months ended June 30, 2023, there was no change in our tax expenses as compared to the three months ended

June 30, 2022.

Our net loss increased by $441,000, or 9.5%, to $5,077,000, for the three months ended June 30, 2023, from $4,636,000 during

the three months ended June 30, 2022.

The increase in net loss resulted primarily from an increase of $694,000 in operating expenses

partially offset by an increase of $193,000 in financial income and an increase of $60,000 in gross profit.

months ended June 30, 2023, compared to the six months ended June 30, 2022

For the six months ended June 30, 2023, revenue increased by $174,000, or 6.4%, to $2,888,000, from $2,714,000 during the six months

ended June 30, 2022.

This increase was predominantly driven by a 8.3% increase in sales volume of CGuard EPS from $2,666,000 during the

six months ended June 30, 2022, to $2,888,000 during the six months ended June 30, 2023.

This sales increase was mainly due to growth

in existing markets.

respect to geographical regions, the increase in revenue was primarily attributable to a $167,000 increase in Europe, a $38,000 increase

in Asia and a $3,000 increase in other geographies.

This increase in sales of was partially offset by a $34,000 decrease in Latin

This growth was mainly due to reason mentioned in the paragraph above.

For the six months ended June 30, 2023, gross profit (revenue less cost of revenues) increased by 56.2%, or $311,000, to

$864,000, compared to a $553,000 for the same period in 2022.

This increase in gross profit resulted from a decrease in write-offs of

$181,000 and a $161,000 increase in revenues (as mentioned above) less the associated related material and labor costs.

This increase

was partially offset by an increase of $31,000 in miscellaneous expenses.

Gross margin (gross profits as a percentage of revenue) increased

to 29.9% during the six months ended June 30, 2023, from 20.4% during the six months ended June 30, 2022, driven by the reasons mentioned

and Development Expenses .

Research and Development Expenses .

For the six months ended June 30, 2023, research and

development expenses increased by 2.7%, or $100,000, to $3,836,000, from $3,736,000 during the six months ended June 30, 2022.

increase resulted primarily from an increase of $158,000 in expenses related to the CGuard Prime regulatory and approval process,

increase in compensation expenses of $169,000 and an increase of $129,000 in miscellaneous expenses offset, in part, by a decrease

of $356,000 in expenses related to the C-Guardians FDA study.

and Marketing Expenses .

For the six months ended June 30, 2023, selling and marketing expenses decreased by 3.0%, or $52,000, to

$1,680,000, from $1,732,000 during the six months ended June 30, 2022.

This decrease resulted primarily from a decrease of approximately

$64,000 of share-based compensation-related expenses, offset, in part, by an increase of $12,000 in miscellaneous expenses.

and Administrative Expenses .

For the six months ended June 30, 2023, general and administrative expenses increased by 18.6%, or $792,000,

to $5,044,000, from $4,252,000 during the six months ended June 30, 2022.

This increase resulted primarily from an increase in salary

expenses of $276,000, an increase in legal expenses of $261,000, an increase in regulatory expenses of $193,000 related to MDR registration

process and an increase of $62,000 in miscellaneous expenses.

For the six months ended June 30, 2023, financial income increased by $313,000, to $363,000 of financial income, from $50,000

of financial income during the six months ended June 30, 2022.

The increase in financial income primarily resulted from a $299,000 increase

in interest income from investment in marketable securities, money market funds and short-term

bank deposits .

For the six months ended June 30, 2023, there was no change in our tax expenses as compared to the six months ended June

Our net loss increased by $216,000, or 2.4%, to $9,333,000, for the six months ended June 30, 2023, from $9,117,000 during

the six months ended June 30, 2022.

The increase in net loss resulted primarily from an increase of $840,000 in operating expenses, offset

by an increase of $313,000 in financial income and increase of $311,000 in gross profit.

and Capital Resources

had an accumulated deficit as of March 31, 2023 of $206 million, as well as a net loss of $4,256,000 and negative operating cash flows.

We expect to continue incurring losses and negative cash flows from operations until our product, CGuard EPS, reaches commercial profitability.

As a result of these expected losses and negative cash flows from operations, along with our current cash position, we believe we have

sufficient resources to fund operations until the end of September 2023.

Therefore, there is substantial doubt about our ability to continue

as a going concern.

of June 30, 2023, we have the ability to fund our planned operations for at least the next 12 months from issuance date of the financial

However, we expect to continue incurring losses and negative cash flows from operations until our products (primarily CGuard™

EPS) reach commercial profitability.

Therefore, in order to fund our operations until such time that we can generate substantial revenues,

we may need to raise additional funds.

plans include continued commercialization of our products and raising capital through sale of additional equity securities, debt or capital

4 unchanged sentences

curtail or cease operations.

On May 12, 2023, we entered into

a securities purchase agreement for the issuance and sale of our securities in a private placement.

Aggregate gross proceeds to us in

respect of the private placement is expected to be approximately $42.2 million, before deducting fees payable to the placement agent and

other offering expenses payable us and before exercising any warrants.

The offering is expected to close on or about May 15, 2023, subject

to the satisfaction of customary closing conditions.

months ended March 31, 2023 compared to the three months ended March 31, 2022

At March 31, 2023, we had cash and cash equivalents of $4,228,000 and short-term bank deposits of $8,657,000 as compared to $4,632,000

and short-term bank deposits of $13,171,000 as of December 31, 2022.

We have historically met our cash needs through a combination of

issuing new shares, borrowing activities and product sales.

Our cash requirements are generally for research and development, marketing

and sales activities, finance and administrative costs, capital expenditures and general working capital.

the three months ended March 31, 2023, net cash used in our operating activities increased by $697,000, or 16.9%, to $4,831,000, from

May 2023, we closed a Private Placement Offering that resulted in aggregate gross proceeds of approximately $42.2 million, before deducting

fees payable to the placement agent and other offering expenses payable by the Company.

If the Warrants from the Private Placement Offering

are exercised in cash in full this would result in an additional $71.4 million of gross proceeds.

months ended June 30, 2023 compared to the six months ended June 30, 2022

At June 30, 2023, we had cash and cash equivalents of $11,545,000 short-term bank deposits of $6,631,000 and marketable securities of

$28,817,000 as compared to cash and cash equivalents of $4,632,000 and short-term bank deposits of $13,171,000 as of December 31, 2022.

We have historically met our cash needs through a combination of issuing new shares, borrowing activities and product sales.

requirements are generally for research and development, marketing and sales activities, finance and administrative costs, capital expenditures

and general working capital.

the six months ended June 30, 2023, net cash used in our operating activities increased by $913,000, or 12.6%, to $8,156,000, from $7,243,000

during the same period in 2022.

The primary reason for the increase in cash used in our operating activities was an increase

of $449,000 in compensation costs paid during the three months ended March 31, 2023 from $2,679,000 in the three months ended March 31,

2022 to $3,128,000 during the same period in 2023 and a decrease of $366,000 in payments received from customers, to $925,000 during

the three months ended March 31, 2023 from $1,291,000 during the same period in 2022 ,offset in part by a decrease of $118,000 in payments

for third party related expenses and for professional services

provided in our investing activities was $4,449,000 during the three months ended March 31, 2023, compared to cash used of $65,000 during

the three months ended March 31, 2022.

The primary reasons for the increase in cash provided by our investing activities is a withdrawal

of short-term deposits, net of investments of $4,500,000 of short-term deposits, offset by a decrease of $12,000 in payments made for

purchase of property, plant and equipment to $25,000 during the three months ended March 31, 2023.

was no cash provided by financing activities for the three months ended March 31, 2023 and for the three months ended March 31, 2022.

of March 31, 2023, our current assets exceeded our current liabilities by a multiple of 3.8.

Current assets decreased by $4,623,000 during

the period and current liabilities decreased by $687,000 during the period.

As a result, our working capital decreased by $3,936,000

to $12,320,000 as of March 31, 2023.

The primary reason for the increase in cash used in our operating activities was an increase of $687,000

in compensation costs paid during the six months ended June 30, 2023 from $4,625,000 in the six months ended June 30, 2022 to $5,312,000

during the same period in 2023 and a decrease of $235,000 in payments received from customers, to $2,472,000 during the six months ended

June 30, 2023 from $2,707,000 during the same period in 2022, offset in part by a decrease of $9,000 in payments for third party related

expenses and for professional services.

used in our investing activities was $22,442,000 during the six months ended June 30, 2023, compared to cash provided of $1,801,000 during

the six months ended June 30, 2022.

The primary reasons for the increase in cash used by our investing activities is an investment in

marketable securities of $28,838,000, offset by an increase in withdrawal from short-term bank deposits, net of investment in short-term

deposits, of $4,500,00, and a decrease of $82,000 in payments made for purchase of property, plant and equipment to $70,000 during the

three months ended June 30, 2023.

provided by financing activities for the six months June 30, 2023, was $37,534,000.

The principal source of the cash provided by financing

activities during the six months ended June 30, 2023 were the proceeds from the Private Placement Offering in May 2023 that resulted

in approximately $37,534,000 of aggregate net proceeds.

Cash used by financing activities for the six months ended June 30, 2022 was

$37,000 and the cash used by financing activities during the six months ended June 30, 2022 were due to issuance cost associated with

a shelf registration statement on Form S-3 filed with the SEC on June 3, 2022.

of June 30, 2023, our current assets exceeded our current liabilities by a multiple of 10.5.

Current assets increased by $29,194,000

during the period and current liabilities decreased by $241,000 during the period.

As a result, our working capital increased by $29,435,000

to $45,691,000 as of June 30, 2023.

Balance Sheet Arrangements

11 unchanged sentences

Obligations and Commitments

the three months ended March 31, 2023, there were no material changes to our contractual obligations and commitments.

the three months ended June 30, 2023, there were no material changes to our contractual obligations and commitments.

Adopted and Issued Accounting Pronouncements

Note 3 to our condensed financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for new accounting pronouncements

Quantitative and Qualitative Disclosures About Market Risk.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis