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Item 2. Management’s Discussion and Analysis

2025-10-30 compared with 2025-07-31 · 145 added, 74 removed, 219 unchanged (50% of the section changed)

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of elderly venous ulcer patients having severe depressive symptoms.

is generally defined as the portion of the population that has a given condition.

Estimates indicate that the prevalence of people in

with severe, deep venous CVI (C4 to C6 disease) with reflux to be approximately 20 million.

Incidence is generally defined as

the number of new cases of an ailment that develop in a given time period.

We estimate that approximately 3.5 million new patients with

severe deep venous CVI are diagnosed each year in the U.S.

including approximately 1.5 million patients that develop venous leg ulcers

(C6 patients).

The average patient seeking treatment of a venous ulcer spends as much as $30,000 a year on wound care, and the total

direct medical costs from venous ulcer sufferers in the U.S.

has been estimated to exceed $3 billion a year.

estimate that there are approximately 2.5 million to 3.5 million patients with severe deep venous CVI in the U.S.

including approximately

1.5 million patients that develop venous leg ulcers (C6 patients).

The average patient seeking treatment of a venous ulcer spends as

much as $30,000 a year on wound care, and the total direct medical costs from venous ulcer sufferers in the U.S.

has been estimated to

exceed $20 billion a year.

VenoValve is a surgically implanted replacement venous valve developed by enVVeno Medical, designed for use in the deep veins of the

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As our planned initial entrant

to the replacement venous valve market, we estimate that approximately 2.5 million people each year with severe deep venous CVI in the

would be candidates for the VenoValve, including approximately 1.5 million people with active venous ulcers.

The VenoValve has been

granted Breakthrough Device designation by the FDA.

to the replacement venous valve market, we estimate that approximately 2.5 million people with severe deep venous CVI in the U.S.

be candidates for the VenoValve, including approximately 1.5 million people with active venous ulcers.

The VenoValve has been granted

Breakthrough Device designation by the FDA.

Clinical Status

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November 2024, one year efficacy and safety data from the U.S.

pivotal study was presented at the 51th Annual VEITH Symposium.

pivotal study was presented at the 51st Annual VEITH Symposium.

indicated that eighty-five percent (85%) of the patients enrolled in the trial experienced a clinical meaningful benefit from the VenoValve,

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at thirty (30) days and one (1) year were ninety one percent (91%) and ninety seven percent (97%), respectively.

November 19, 2024, the Company submitted the final module of its PMA application for review by the FDA.

June 2025, the Company announced that interim two-year follow-up data on forty-two (42) subjects from the seventy-five (75) patient VenoValve

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clinically validated scoring system used to track the progression or regression of venous diseases.

November 19, 2024, the Company submitted the final module of its PMA application for review by the FDA.

The VenoValve is designated as

a breakthrough product and, as a result, its PMA application is subject to priority review.

This may serve to shorten the PMA review

Regardless, it is difficult to predict precisely how long the PMA process will take, and the Company’s best estimate is

to expect an FDA decision during the second half of 2025.

August 19, 2025, the Company announced that it received a not-approvable letter from the FDA in response to its PMA application for the

The letter indicated that the FDA completed its review of the VenoValve PMA application and determined that it is unable to

approve the PMA for the VenoValve in its current form.

In particular, the FDA indicated that the favorable rVCSS data generated by the

study to show clinical improvement, together with the improvements in pain scores and venous specific quality of life indicators was

not sufficient on its own to determine favorability of the benefit risk profile for the VenoValve.

Without a specific hemodynamic measurement

that correlates with patient improvement, the FDA raised concerns about bias and the possibility that clinical improvement occurred as

a result of the patients being enrolled in a study.

The FDA also focused on safety concerns which were attributed to the VenoValve open

surgical procedure, and that required re-hospitalizations.

The Company would not expect to see similar safety events with a non-surgical

replacement valve.

September 18, 2025, the Company filed a request for supervisory appeal of the not-approvable letter from the Center for Devices and Radiological

Health (CDRH) of the FDA received on August 19, 2025, in response to its PMA application for the VenoValve.

The FDA provides several

internal informal and formal mechanisms to challenge staff decisions, including scientific controversies.

One mechanism is a request

for supervisory review in which an appeal is made to the next line of supervision.

Supervisory appeals are required to be filed within

30 days of the decision being appealed, which was on or before September 18, 2025.

These appeals involve a formal substantive request,

an in-person meeting, and a decision.

It also often includes multiple interactions even after an initial appeal decision is made.

Agency reviews are based on information already in the administrative file.

Due to the variety of both physician reported and patient

reported data generated by the VenoValve pivotal study and which is already a part of the file, the Company is confident that explaining

this data to supervisory management in a focused appeal setting may lead to a positive outcome, with a decision expected by the end of

October 2025, the Company completed an in-person meeting with the FDA.

In addition to representatives from an outside firm specializing

in FDA matters and appeals and representatives from the Company, the meeting also included a patient advocate from VenoValve U.S.

study as well as one of the Company’s primary investigators from the trial.

Several employees from the FDA attended the meeting

including the Director of the Center for Devices and Radiological Health, who elected to hear the appeal and who will be issuing the

appeal decision.

The FDA meeting provided the Company with the opportunity to put the major adverse events—those tied to the SAVVE

study’s safety endpoints—into the proper context.

It also allowed the Company to re-emphasize the multiple physician-and

patient-reported clinical benefits that comprise the totality of the evidence from the study, supported by firsthand perspectives shared

by both the SAVVE study patient and investigator in attendance.

Because there are no established industry or regulatory standards to

determine the effectiveness for a replacement venous valve, it is necessary for the Company and the Agency to establish a new regulatory

pathway for VenoValve effectiveness.

Company worked collaboratively with the FDA over the past several years to help ensure that the Company was collecting the necessary

data to support effectiveness of the VenoValve and that dialogue with respect to effectiveness is continuing as part of this appeal.

There are often multiple ways to satisfactorily address a given regulatory issue, and at the meeting, the Company proposed an alternative

effectiveness pathway for the VenoValve, supported by data already collected in SAVVE.

The Company expects to hear from the FDA about

this stage of the appeal process by the end of 2025.

the subject of the FDA appeal and the FDA meeting is specific to the VenoValve, the appeal does also have implications for enVVe, our

next generation transcatheter replacement venous valve, and as a result, the Company is waiting for clarity from the FDA prior to filing

the enVVe IDE application.

September 21, 2022, we announced the development of a non-surgical transcatheter based replacement venous valve called enVVe ® ,

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pivotal study.

The Company expects to file for IDE approval for the enVVe pivotal study in the third quarter of 2025.

The Company is waiting until certain regulatory issues with respect to the VenoValve are resolved with the

FDA before filing the IDE for enVVe, which the Company expects to file in the first quarter of 2026.

finished 2024 with approximately $43.2 million of cash and investments and had approximately $31.0 million of cash and investments as

of June 30, 2025.

Our future capital requirements will remain dependent upon a variety of factors, especially including the success of

our clinical trials, related product development costs, and our ability to successfully bring products to market.

of September 30, 2025.

Our future capital requirements will remain dependent upon a variety of factors, especially including the success

of our clinical trials, related product development costs, and our ability to successfully bring products to market.

We anticipate that

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quarter as we conduct our clinical trials and work toward bringing our product candidates to market.

Deficiency Letter

October 7, 2025, the Company received notification from Nasdaq notifying the Company that, because the closing bid price for the Company’s

common stock has fallen below $1.00 per share for 30 consecutive business days, the Company no longer complies with the minimum bid price

requirement for continued listing on the Nasdaq Capital Market under Rule 5550(a)(2) of Nasdaq Listing Rules.

notice has no immediate effect on the listing of the Company’s common stock on the Nasdaq Capital Market.

accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has a period of 180 calendar days from the date of notification, or until

April 6, 2026, to regain compliance with the minimum bid price requirement.

To regain compliance, the closing bid price of the Company’s

common stock must close at or above $1.00 per share for a minimum of 10 consecutive trading days (which period may be extended to greater

than 10 consecutive trading days at the sole discretion of Nasdaq) prior to April 6, 2026.

the event the Company does not regain compliance by April 6, 2026, the Company may be eligible for an additional 180 calendar day compliance

period to demonstrate compliance with the bid price requirement.

To qualify for the additional 180-day period, the Company will be required

to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq

Capital Market, with the exception of the bid price requirement, and will need to provide written notice to Nasdaq of its intention to

cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

If the Nasdaq staff determines

that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible for such additional compliance

period, Nasdaq will provide notice that the Company’s common stock will be subject to delisting.

The Company would have the right

to appeal a determination to delist its common stock, and the common stock would remain listed on the Nasdaq Capital Market until the

completion of the appeal process.

of Operations

of the three months ended June 30, 2025 and 2024

reported net losses of $6.7 million and $5.0 million for the three months ended June 30, 2025 and 2024, respectively, representing an

increase in net loss of $1.7 million, or 35%, due to an increase in operating expenses of $1.6 million and a decrease in other income

of $0.1 million, as described in further detail below.

of the three months ended September 30, 2025 and 2024

reported net losses of $4.5 million and $5.6 million for the three months ended September 30, 2025 and 2024, respectively, representing

a decrease in net loss of $1.1 million, or 20%, due to a decrease in operating expenses of $1.3 million, partially offset by a decrease

in other income of $0.2 million, as described in further detail below.

a developmental stage Company, our revenue, if any, is expected to be diminutive and dependent on our ability to commercialize our product

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and Development Expenses

the three months ended June 30, 2025, research and development expenses increased by $0.1 million or 2%, to $2.9 million from $2.8 million

for the three months ended June 30, 2024.

This increase primarily resulted from $0.2 million in higher compensation costs from additional

personnel, as well as higher professional fees, partially offset by $0.1 million in lower costs related the VenoValve pivotal study as

the amount of follow-up for each participant decreases over time.

the three months ended September 30, 2025, research and development expenses decreased by $0.3 million or 10%, to $2.6 million from $2.9

million for the three months ended September 30, 2024.

This decrease primarily resulted from $0.4 million in lower costs related the

VenoValve pivotal study as the amount of follow-up for each participant decreases over time, partially offset by $0.1 million in higher

compensation costs from additional personnel.

General and Administrative Expenses

the three months ended June 30, 2025, selling, general and administrative

expenses increased by $1.6 million or 58%, to $4.2 million from $2.6 million for the three months ended June 30, 2024.

Of this increase,

$0.4 million was due to compensation costs from the net effect of higher stock-based compensation from the issuance of additional option

grants, a non-recurring severance expense of $0.3 million recorded in 2025, and $0.2 million related to higher compensation costs from

additional personnel.

This increase was also due to a non-recurring $0.6 million reserve for potentially uncollectible prepaid clinical

costs resulting from payments made to a vendor that were not passed through from the vendor to clinical sites, as contractually required,

and a net $0.1 million increase related to various other expenses.

the three months ended June 30, 2025, other income decreased $0.1 million or 29% to $0.4 million from $0.5 million for the three months

ended June 30, 2024.

Other income in both periods reflects realized gains, interest, and unrealized gains from our program to invest

excess cash in US Treasury bills.

of the six months ended June 30, 2025 and 2024

reported net losses of $11.2 million and $10.0 million for the six months ended June 30, 2025 and 2024, respectively, representing an

increase in net loss of $1.2 million or 13%, due to an increase in operating expenses of $1.0 million and a decrease in other income

of $0.2 million, as described in further detail below.

the three months ended September 30, 2025, selling, general and administrative expenses decreased by $1.0 million or 31%, to $2.3 million

from $3.3 million for the three months ended September 30, 2024.

Of this decrease, $0.7 million was due to non-recurring legal costs

incurred during the three months ended September 30, 2024 and $0.3 million was due to the net effect of lower stock-based compensation

cost incurred as option grants are issued and vest.

This decrease was also due to a $0.3 million partial recovery of a non-recurring

$0.6 million reserve recorded during the six months ended June 30, 2025 for potentially uncollectible prepaid clinical costs resulting

from payments made to a vendor that were not passed through from the vendor to clinical sites, as contractually required.

These decreases

were partially offset by a net $0.3 million increase related to various other expenses.

the three months ended September 30, 2025, other income decreased $0.2 million or 35% to $0.3 million from $0.5 million for the three

months ended September 30, 2024.

Other income in both periods reflects realized gains, interest, and unrealized gains or losses from

our program to invest excess cash in US Treasury securities.

of the nine months ended September 30, 2025 and 2024

reported net losses of $15.7 million and $15.6 million for the nine months ended September 30, 2025 and 2024, respectively, representing

an increase in net loss of $0.1 million or 1%, due to a decrease in other income of $0.3 million, partially offset by a decrease in operating

expenses of $0.2 million, as described in further detail below.

a developmental stage Company, our revenue, if any, is expected to be diminutive and dependent on our ability to commercialize our product

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and Development Expenses

the six months ended June 30, 2025, research and development expenses decreased by $0.5 million or 7%, to $5.4 million from $5.9 million

for the six months ended June 30, 2024.

This decrease primarily resulted from $0.9 million in lower costs related to the VenoValve study

as the amount of follow-up for each participant decreases over time, partially offset by $0.4 million in higher compensation costs from

additional personnel, as well as higher professional fees.

the nine months ended September 30, 2025, research and development expenses decreased by $0.7 million or 8%, to $8.0 million from $8.7

million for the nine months ended September 30, 2024.

This decrease primarily resulted from $1.3 million in lower costs related to the

VenoValve study as the amount of follow-up for each participant decreases over time, partially offset by $0.6 million in higher compensation

costs from additional personnel, as well as higher professional fees.

General and Administrative Expenses

the six months ended June 30, 2025, selling, general and administrative

expenses increased $1.5 million or 29%, to $6.6 million from $5.1 million for the six months ended June 30, 2024.

Of this increase, $0.3

million was due to a non-recurring severance expense recorded in 2025 and $0.4 million related to higher compensation costs from additional

This increase was also due to a non-recurring $0.6 million reserve for potentially uncollectible prepaid clinical costs resulting

from payments made to a vendor that were not passed through from the vendor to clinical sites, as contractually required, and a net $0.2

million increase related to various other expenses.

the nine months ended September 30, 2025, selling, general and administrative expenses increased $0.5 million or 6%, to $8.9 million

from $8.4 million for the nine months ended September 30, 2024.

Of this increase, $0.3 million was due to a non-recurring severance expense

recorded in 2025 and $0.6 million related to higher compensation costs from additional personnel.

This increase was also due to a non-recurring

$0.3 million reserve for potentially uncollectible prepaid clinical costs resulting from payments made to a vendor that were not passed

through from the vendor to clinical sites, as contractually required, and a net $0.5 million increase related to various other expenses.

These increases were partially offset by $0.9 million in non-recurring legal costs incurred during the nine months ended September 30,

2024 and $0.3 million from the net effect of lower stock-based compensation cost incurred as option grants are issued and vest.

(Income) Expense

the six months ended June 30, 2025, other income decreased $0.2 million to $0.8 million from $1.0 million for the six months ended June

Other income in both periods reflects realized gains, interest, and unrealized gains from our program to invest excess cash

the nine months ended September 30, 2025, other income decreased $0.3 million to $1.2 million from $1.5 million for the nine months ended

September 30, 2024.

Other income in both periods reflects realized gains, interest, and unrealized gains or losses from our program to

invest excess cash in US Treasury securities.

and Capital Resources

the six months ended June 30, 2025, the Company incurred losses from operations of $12.0 million and used $7.7 million cash in operating

The net cash used in operating activities during the 2025 period increased by $0.2 million from $7.5 million for the period

ended June 30, 2024.

the nine months ended September 30, 2025, the Company incurred losses from operations of $15.7 million and used $12.1 million cash in

operating activities.

The net cash used in operating activities during the 2025 period increased by $0.4 million from $11.7 million for

the period ended September 30, 2024.

losses and the uses of cash are primarily due to our product research and development activities, including clinical studies, and administrative

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We anticipate that our cash burn rate

will increase from current levels of approximately $4 million to between $5 million and $7 million per quarter as we conduct our clinical

studies and work toward bringing our product candidates to market.

will increase from current levels of approximately $4 million per quarter to between $5 million and $7 million per quarter as we conduct

our clinical studies and work toward bringing our product candidates to market.

have historically funded our operations through financing activities, such as the capital raise completed in 2024, and will need to raise

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Any inability to raise additional financing would have a material adverse effect on us.

on our cash and working capital as of June 30, 2025, we have sufficient capital resources to meet our obligations as they become due

for at least one year after the date of this Quarterly Report and sustain operations.

on our cash and working capital as of September 30, 2025, we have sufficient capital resources to meet our obligations as they become

due for at least one year after the date of this Quarterly Report and sustain operations.

Accounting Estimates

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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