What changed in this filing

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Item 1. Financial Statements

2023-04-28 compared with 2022-10-27 · 120 added, 170 removed, 94 unchanged (76% of the section changed)

2 unchanged sentences

BALANCE SHEETS

(In thousands except par values,

unless otherwise indicated)

(In thousands except par values, unless otherwise indicated)

Current Assets:

Cash and cash

Cash and cash equivalents

Short-term investments

expenses and other current assets

Prepaid expenses and other current assets

Total Current Assets

Property and equipment,

Operating lease right-of-use

Long-term investments

deposits and other assets

Liabilities and Stockholders’

Current Liabilities:

Accounts payable

Accrued expenses and other

Property and equipment, net

Operating lease right-of-use assets, net

Security deposits and other assets

Liabilities and Stockholders’ Equity

Current Liabilities:

portion of operating lease liabilities

Accounts payable, accrued expenses and other current liabilities

Current portion of operating lease liabilities

Total Current Liabilities

operating lease liabilities

Long-term operating lease liabilities

Total Liabilities

Commitments and Contingencies

Stockholders’ Equity:

Preferred stock, par value

$ 0.00001 , 10,000 shares authorized:

Preferred stock, par value $ 0.00001 , 10,000 shares authorized:

no shares issued or outstanding

Common stock, par value $ 0.00001 , 250,000

shares authorized, 9,472 and 9,470 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively

Common stock, par value $ 0.00001 , 250,000 shares authorized, 9,472 shares issued and outstanding as of March 31, 2023 and December 31, 2022

Additional paid-in capital

Stockholders’ Equity

Liabilities and Stockholders’ Equity

Accumulated deficit

Total Stockholders’ Equity

Total Liabilities and Stockholders’ Equity

Notes to these Unaudited Condensed Financial Statements

1 unchanged sentence

STATEMENTS OF OPERATIONS

For the Three

For the Three Months Ended

(In thousands, except per share data)

Operating Expenses:

Selling, general and administrative

Research and development

from Operations

Other (Income) Expense:

Gain on extinguishment

of note payable

Interest income,

Unrealized loss from investments

Other (Income) Expense

Loss Per Basic and Diluted Common Share:

Selling, general and administrative expenses

Research and development expenses

Loss from Operations

Other Income:

Realized gain from sales of trading securities

Unrealized gain from trading securities

Interest income, net

Total Other Income

Net Loss Per Basic and Diluted Common Share:

Weighted Average Number of Common Shares Outstanding:

Basic and Diluted

Notes to these Unaudited Condensed Financial Statements

MEDICAL CORPORATION

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIENCY)

thousands, unless otherwise indicated)

1 unchanged sentence

Balance at January 1, 2023

$ ( 106,520 )

Shared-Based Compensation

Balance at March 31, 2023

Shared-Based Compensation

Balance at June 30, 2022

Share-Based Compensation

Balance at September 30, 2022

Stockholders’

Balance at January 1, 2022

Common stock issued in

public offering

Common stock issued for

exercise of warrants

Shared-Based Compensation

Fair Value of Warrants Issued

Balance at March 31, 2022

Shared-Based Compensation

Shares issued in satisfaction

of trade payable

Balance at June 30, 2021

Common stock issued in

at the market transactions

Common stock issued in

registered direct offering

Shared-Based Compensation

Balance at September 30, 2021

Notes to these Unaudited Condensed Financial Statements

2 unchanged sentences

thousands, unless otherwise indicated)

Cash Flows from Operating

Adjustments to reconcile

net loss to net cash used in operating activities:

For the Three Months Ended

Cash Flows from Operating Activities

Adjustments to reconcile net loss to net cash used in operating activities:

Share-based compensation

Depreciation and amortization

Amortization of right-of-use

Gain on extinguishment

of note payable

Unrealized loss from investments,

Changes in operating assets

and liabilities:

Prepaid expenses and other

current assets

Security deposit and other

Amortization of right of use assets

Unrealized gain from Investments

Deposit applied to consulting services

Changes in operating assets and liabilities:

Prepaid expenses and other current assets

Accounts payable

Accrued expenses and other

current liabilities

lease liabilities

Cash Used in Operating Activities

Cash Flows from Investing

Purchase of property and

Purchases of investments

Accrued expenses and other current liabilities

Operating lease liabilities

Total adjustments

Net Cash Used in Operating Activities

Cash Flows from Investing Activities

Maturities of investments

Cash Used in Investing Activities

Cash Flows from Financing

Proceeds from shares issued

under ATM, net

Proceeds from registered

direct offering, net

Proceeds from public offering,

from Warrant Exercises

Cash Provided by Financing Activities

(Decrease) Increase in Cash, Cash Equivalents

Cash, cash equivalents

- Beginning of period

Cash, cash equivalents

- End of period

Notes to these Unaudited Condensed Financial Statements

MEDICAL CORPORATION

STATEMENTS OF CASH FLOWS (Continued)

thousands, unless otherwise indicated)

Purchase of property and equipment

Purchase of investments

Net Cash Provided by (Used in) Investing Activities

Net Decrease in Cash

Cash, cash equivalents - Beginning of period

Cash, cash equivalents - End of period

For the Three Months Ended

Supplemental Disclosures of Cash Flow Information:

Cash Received During the Period For:

Non-Cash Financing Activities:

value of common stock issued in satisfaction of trade payable

value of warrants issued in satisfaction of trade payables and accrued expenses

Interest, net

Notes to these Unaudited Condensed Financial Statements

4 unchanged sentences

solutions to improve the standard of care for the treatment of venous disease.

The Company’s lead product, the VenoValve®,

is a first-in-class surgical replacement venous valve being developed for the treatment of deep venous Chronic Venous Insufficiency

The Company is also developing a non-surgical, transcatheter based replacement venous valve for the treatment of deep venous

CVI called enVVe™.

CVI occurs when valves inside of the veins of the leg become damaged, resulting in the backwards flow of

blood (reflux), blood pooling in the lower leg, increased pressure in the veins of the leg (venous hypertension) and in severe

cases, venous ulcers that are difficult to heal and become chronic.

Both the VenoValve and enVVe are designed to act as one-way

valves, to help assist in propelling blood up the leg, and back to the heart and lungs.

The VenoValve is currently being evaluated

in the SAVVE U.S.

pivotal study and the company is currently waiting for regulatory approval to begin the TAVVE first-in-human

trial for enVVe.

Our team of officers and directors has been affiliated with numerous medical devices that have received FDA

approval or CE marking and that have been commercially successful.

We develop and manufacture our products in a 14,507 sq.

leased manufacturing facility in Irvine, California, which has been ISO 13485-2016 certified for the design, development and

manufacturing of tissue based implantable medical devices.

The Company is developing surgical and non-surgical replacement

venous valves for patients suffering from severe Chronic Venous Insufficiency (CVI) of the deep venous system of the leg.

CVI most often

occurs when valves inside the veins of the leg become damaged, resulting in the backwards flow of blood (reflux), blood pooling in the

lower leg, increased pressure in the veins of the leg (venous hypertension) and in severe cases, venous ulcers that are difficult to

The Company’s lead product is the VenoValve® which is currently being evaluated in a U.S.

pivotal study.

is also developing a second product called enVVe™, which is a transcatheter based replacement venous valve.

Both the VenoValve

and enVVe are designed to act as one-way valves, to help assist in propelling blood up the veins of the leg, and back to the heart and

Our team of officers and directors has been affiliated with numerous medical devices that have received FDA approval or CE marking

and that have been commercially successful.

We develop and manufacture our products in a 14,507

leased manufacturing facility in Irvine,

California, which has been ISO 13485-2020 certified for the design, development and manufacturing of tissue based implantable medical

2 – Management’s Liquidity Plan

of September 30, 2022, the Company had a cash balance of $ 2.9 million, investments of $ 39.8 million and working capital of $ 39.4 million.

Although the Company expects to continue incurring losses for the foreseeable future and may need to raise additional capital to sustain

its operations, pursue its product development initiatives and penetrate markets for the sale of its products, Management believes that

our capital resources at September 30, 2022 are sufficient to meet our obligations as they become due within one year after the date

of this Quarterly Report, and sustain operations.

MEDICAL CORPORATION

TO CONDENSED FINANCIAL STATEMENTS

of March 31, 2023, the Company had a cash and investment balance of $ 34.2 million and working capital of $ 33.4 million.

Company expects to continue incurring losses for the foreseeable future and may need to raise additional capital to sustain its operations,

pursue its product development initiatives and penetrate markets for the sale of its products, Management believes that our capital resources

at March 31, 2023 are sufficient to meet our obligations as they become due within one year after the date of this Quarterly Report,

and sustain operations.

3 – Significant Accounting Policies

6 unchanged sentences

of normal recurring items) which are considered necessary for a fair presentation of the unaudited condensed financial statements of

the Company as of September 30, 2022 and December 31, 2021, and for the three and nine months ended September 30, 2022 and 2021.

results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the operating results

for the full year.

These unaudited condensed financial statements should be read in conjunction with the financial statements and notes

thereto for the year ended December 31, 2021 included in the Company’s Form 10-K filed with the SEC on March 28, 2022.

The condensed

balance sheet as of December 31, 2021 has been derived from the Company’s audited financial statements.

consider all highly liquid interest-earning investments with a maturity of three months or less at the date of purchase to be cash equivalents.

The fair values of these investments approximate their carrying values.

Investments with original maturities of greater than three months

and remaining maturities of less than one year are classified as short-term investments.

Investments with maturities beyond one year

are classified as long-term investments.

investments are classified as trading securities and realized gains and losses are recorded using the specific identification method.

Changes in fair value, excluding credit losses and impairments, are recorded in unrealized gains (losses) from investments.

is calculated based on publicly available market information.

If the cost of an investment exceeds its fair value, we evaluate, among

other factors, general market conditions, credit quality of debt instrument issuers, and the extent to which the fair value is less than

We recognize interest income based on the stated coupon rate of the investments purchased.

4 – Investments

components of investments were as follows at September 30, 2022:

Schedule of Investments

Term Investment

Fair Value Level 1

Total debt investments

losses from fixed-income securities are primarily attributable to changes in interest rates.

Management does not believe any remaining

unrealized losses represent impairments based on our evaluation of available evidence.

There were no similar investments at December

the Company as of March 31, 2023 and December 31, 2022, and for the three months ended March 31, 2023 and 2022.

results of operations for the three months ended March 31, 2023 are not necessarily indicative of the operating results for the full

These unaudited condensed financial statements should be read in conjunction with the financial statements and notes thereto

for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 2, 2023.

The accompanying condensed balance sheet as of December 31, 2022 has been derived from the Company’s audited financial

MEDICAL CORPORATION

2 unchanged sentences

Company maintains cash with major financial institutions.

Cash held in United States bank institutions is currently insured by the Federal

Deposit Insurance Corporation (“FDIC”) up to $ 250 at each institution.

Cash held in United States bank institutions is currently insured by the

Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000

at each institution.

There were aggregate uninsured cash balances of $ 2.0

million and $ 54.5 million as of September 30, 2022 and December 31, 2021, respectively.

6 – Accrued Expenses and Other Current Liabilities

of September 30, 2022, and December 31, 2021, accrued expenses and other current liabilities consist of the following:

Schedule of Accrued

Expenses and Other Current Liabilities

million and $ 4.3

million as of March 31, 2023 and December 31, 2022, respectively.

5 – Property and Equipment

of March 31, 2023 and December 31, 2022, property and equipment consist of the following:

of Property and Equipment

(In thousands)

Laboratory equipment

Furniture and fixtures

Computer equipment

Leasehold improvements

Total property and equipment

accumulated depreciation

Property and equipment, net

expense amounted to $ 0.1 million for the three months ended March 31, 2023 and 2022.

Depreciation expense is reflected in general and

administrative expenses in the accompanying statements of operations.

MEDICAL CORPORATION

TO CONDENSED FINANCIAL STATEMENTS

6 – Accounts Payable Accrued Expenses and Other Current Liabilities

of March 31, 2023, and December 31, 2022, accounts payable, accrued expenses and other current liabilities consist of the

of Accrued Expenses and Other Current Liabilities

(In thousands)

Accounts payable

Accrued compensation costs

2 unchanged sentences

Other accrued expenses

Total accrued expenses and other current liabilities

7 – Commitments and Contingencies

21 unchanged sentences

punitive damages and attorney’s fees and costs.

The Company has denied all claims in both matters (which have now been consolidated)

and has filed a counterclaim asserting that Rankin has breached his employment agreement with the Company to the Company’s damage.

The Company continues to believe it has meritorious defenses to both matters which are currently set for trial on June 12, 2023.

the date of these financial statements, the amount of loss associated with these complaints, if any, cannot be reasonably estimated.

Company has denied all claims in both matters (which have now been consolidated) and has filed a counterclaim asserting that Rankin

has breached his employment agreement with the Company to the Company’s damage.

The Company continues to believe it has

meritorious defenses to both matters which are currently set for trial on October 30, 2023.

As of the date of these financial statements, the amount of loss associated with these

complaints, if any, cannot be reasonably estimated.

Accordingly, no amounts related to these complaints are accrued as of March 31,

MEDICAL CORPORATION

TO CONDENSED FINANCIAL STATEMENTS

NOTES TO CONDENSED FINANCIAL STATEMENTS

8 – Stockholders’ Equity

time to time, the Company issues options for the purchase of its common stock to employees and others.

During the nine-months ended September

30, 2022, the Company granted options to employees for the purchase off forty-three thousand shares with a weighted average exercise

price of $ 6.76 per share.

The Company recognized $ 6.6 million and $ 0.7 million of share-based compensation related to stock options during

the nine months ended September 30, 2022 and 2021, respectively.

As of September 30, 2022, there was $ 8.6 million of unrecognized stock-based

compensation expense related to outstanding stock options that will be recognized over the weighted average remaining vesting period

of 1.6 years.

The Company recognized $ 1.8

million and $ 2.2

million of share-based compensation related to stock options during the three months ended March 31, 2023 and 2022, respectively.

of March 31, 2023, there was $ 6.6

million of unrecognized share-based compensation expense related to outstanding stock options that will be recognized over the

weighted average remaining vesting period of 1.7 years.

Share-based compensation is reflected in selling, general and administrative expenses in the accompanying condensed statements of operations.

9 – Net Loss per Share

following table summarizes the number of potentially dilutive common stock equivalents excluded from the calculation of diluted net loss

per common share as of September 30, 2022 and 2021:

per common share as of March 31, 2023 and 2022:

of Dilutive Net Loss Per Common Share

(In thousands)

Shares of common stock issuable upon exercise of

Shares of common stock issuable upon exercise

Potentially dilutive

common stock equivalents excluded from diluted net loss per share

Shares of common stock issuable upon exercise of warrants

Shares of common stock issuable upon exercise of options

Potentially dilutive common stock equivalents excluded from diluted net loss per share

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 1. Financial Statements