You should read the following discussion and analysis together with our Consolidated Financial Statements and the notes thereto included elsewhere in this Form 10-K. This discussion contains forward-looking statements that involve risks and uncertainties. For additional discussion, see "CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS" above.
Overview
We are a clinical-stage medical diagnostics company developing rapid, tests
using whole blood on our Symphony platform ("Symphony") to improve patient
outcomes in critical care settings. Our Symphony technology platform is an
exclusively licensed, patented system that consists of a mobile device and
single-use test cartridges that if cleared, authorized, or approved by the
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Since inception, we have incurred net losses from operations each year and we
expect to continue to incur losses for the foreseeable future. We incurred net
losses of approximately
Results of Operations
Comparison of Years Ended
The following table sets forth our results of operations for the years endedDecember 31, 2022 and 2021: Year Ended December 31, 2022 2021 Revenue$ 249,040 $ - Cost of sales 200,129 - Gross profit 48,911 - Operating expenses: Research and development 4,152,152 1,147,955 General and administrative 4,763,114 1,792,482 Marketing and business development 451,421 289,726 Total operating expenses 9,366,687 3,230,163 Operating loss (9,317,776 ) (3,230,163 ) Other income (expense): Interest expense, net of amortization of premium - (367,459 ) Impairment of property and equipment (237,309 ) - State grant revenue - 75,000 Other income, net 258,137 34,324 Total other income (expense), net 20,828 (258,135 ) Net loss$ (9,296,948 ) $ (3,488,298 ) Revenue and Gross Profit
Revenue and gross profit increased approximately
Research and Development
Research and development expenses increased approximately
General and Administrative
General and administrative expenses increased approximately
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Marketing and Business Development
Marketing and business development expenses increased approximately
Total Other Income (Expense), net
Total other income (expense) increased approximately
Liquidity and Capital Resources
Since our inception, we have financed our operations primarily through proceeds
from our IPO, debt financings, private placements, interest income earned on
cash and cash equivalents, and grants. At
Primary Sources of and Uses of Cash
The following table sets forth the primary sources and uses of cash and cash equivalents for each of the periods presented.
Years Ended December 31, 2022 2021 Cash proceeds provided by (used in): Operating activities$ (7,741,593 ) $ (4,366,758 ) Investing activities (1,199,270 ) (23,947 ) Financing activities 8,075 22,526,122
Net (decrease) increase in cash and cash equivalents
Net cash used in operating activities
During 2022, we used
Net cash used in investing activities
During 2022, we used
Net cash provided by financing activities
During 2022, we generated
29 Contractual Obligations
See Note 12 to consolidated financial statements for our lease obligations and Note 13 to the consolidated financial statements for our other non-cancellable contractual obligations.
Liquidity and Going Concern
We had cash and cash equivalents of
We may seek to raise such additional capital through public or private equity offerings, grant financing and support from governmental agencies, convertible debt, collaborations, strategic alliances and distribution arrangements. Additional funds may not be available when we need them on terms that are acceptable to us, or at all. If adequate funds are not available, we may be required to delay or reduce the scope of our research or development programs, our commercialization efforts or our manufacturing commitments and capacity. In addition, if we raise additional funds through collaborations, strategic alliances or distribution arrangements with third parties, we may have to relinquish valuable rights to its technologies or future revenue streams.
If we are unsuccessful in our efforts to raise additional capital, based on our current and expected levels of operating expenses, our current capital will not be sufficient to fund our operations for the next twelve months. These conditions raise substantial doubt about our ability to continue as a going concern.
Recent Financings Convertible Debentures
On
Initial Public Offering
We completed our IPO on
30 Indemnification
We have certain agreements with service providers with which we do business that contain indemnification provisions pursuant to which we typically agree to indemnify the party against certain types of third-party claims. We accrue for known indemnification issues when a loss is probable and can be reasonably estimated. We would also accrue for estimated incurred but unidentified indemnification issues based on historical activity. As we have not incurred any indemnification losses to date, there were no accruals for or expenses related to indemnification issues for any period presented.
Critical Accounting Policies and Estimates
Some of our critical accounting policies require us to make difficult, subjective or complex judgments or estimates. An accounting estimate is considered to be critical if it meets both of the following criteria: (i) the estimate requires assumptions about matters that are highly uncertain at the time the accounting estimate is made, and (ii) different estimates reasonably could have been used, or changes in the estimate that are reasonably likely to occur from period to period may have a material impact on the presentation of our financial condition, changes in financial condition or results of operations.
As an emerging growth company, we have elected to opt-in to the extended transition period for new or revised accounting standards. As a result, our consolidated financial statements may not be comparable to those of companies that comply with public company effective dates.
Stock-Based Compensation
Our stock-based compensation expense for stock awards is estimated at the grant date based on the award's fair value as determined by the consideration received or as calculated by the Black-Scholes option pricing model, whichever is more readily measurable. The Black-Scholes pricing model requires various highly judgmental assumptions including expected volatility and expected term. The expected volatility is based on the historical stock volatilities of several similar public companies over a period equal to the expected terms of the awards as we do not have a sufficient trading history to use the volatility of our own common stock. To estimate the expected term, we have opted to use the simplified method, which uses of the midpoint of the vesting term and the contractual term. We recognize the compensation cost of share-based awards on a straight-line basis over the requisite service period, however, for stock awards for which vesting is subject to performance - based milestones, the expense is recorded over the implied service period after the point when the achievement of the milestone is probable, or the performance condition has been achieved. If any of the assumptions used in the Black-Scholes pricing model changes significantly, stock-based compensation expense may differ materially in the future from that recorded in the current period
Recently Adopted Accounting Standards
See Note 2 to consolidated financial statements (under the caption "Recently Issued Accounting Standards").
Recently Issued Accounting Standards
See Note 2 to consolidated financial statements (under the caption "Recently Issued Accounting Standards").
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