Bluejay Diagnostics(BJDX) - 2025 Q1 - Quarterly Report

PART I FINANCIAL INFORMATION Condensed Consolidated Financial Statements (Unaudited) The unaudited condensed consolidated financial statements for the quarter ended March 31, 2025, show a net loss of $1.9 million, a decrease from the $2.3 million loss in the same period of 2024. Total assets decreased to $5.3 million from $6.7 million at year-end 2024, primarily due to a reduction in cash. The company's financial position raises substantial doubt about its ability to continue as a going concern, with cash resources expected to fund operations only up to the third quarter of 2025. A key subsequent event was an April 2025 private placement that raised approximately $3.8 million in gross proceeds Condensed Consolidated Balance Sheets As of March 31, 2025, the company's total assets were $5.28 million, a decrease from $6.66 million at December 31, 2024. This was primarily driven by a decrease in cash and cash equivalents from $4.30 million to $3.12 million. Total liabilities increased from $0.93 million to $1.41 million, while total stockholders' equity decreased from $5.73 million to $3.87 million over the same period Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $3,116 | $4,302 | | Total current assets | $3,572 | $4,899 | | Total assets | $5,278 | $6,657 | | Liabilities & Equity | | | | Total current liabilities | $1,317 | $810 | | Total liabilities | $1,412 | $928 | | Total stockholders' equity | $3,866 | $5,729 | | Total liabilities and stockholders' equity | $5,278 | $6,657 | Condensed Consolidated Statements of Operations For the three months ended March 31, 2025, the company reported a net loss of $1.86 million, or ($3.37) per share. This is an improvement from the net loss of $2.33 million, or ($394.76) per share, for the same period in 2024. The reduced loss was primarily due to a decrease in research and development expenses Statement of Operations Summary (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Research and development | $785 | $1,335 | | General and administrative | $1,104 | $1,087 | | Total operating expenses | $1,889 | $2,428 | | Operating loss | ($1,889) | ($2,428) | | Net loss | ($1,864) | ($2,328) | | Net loss per share | ($3.37) | ($394.76) | Condensed Consolidated Statements of Cash Flows For the three months ended March 31, 2025, net cash used in operating activities was $1.18 million, a significant reduction from $2.30 million in the prior year period. There were no investing activities in Q1 2025. Unlike Q1 2024, which saw $2.79 million in net cash from financing activities, Q1 2025 had negligible financing cash flow. This resulted in a net decrease in cash of $1.19 million for the quarter Cash Flow Summary (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($1,185) | ($2,300) | | Net cash used in investing activities | $0 | ($35) | | Net cash (used in) provided by financing activities | ($1) | $2,788 | | Net increase (decrease) in cash | ($1,186) | $453 | Notes to Condensed Consolidated Financial Statements The notes detail the company's focus on developing the Symphony IL-6 test for sepsis, with a goal for a 510(k) FDA submission in Q4 2027, contingent on raising at least $30 million. A significant 'Going Concern' uncertainty is disclosed, stating current cash will only fund operations into Q3 2025. The notes also cover the license agreement with Toray, various financing activities in 2024, outstanding warrants, and a subsequent event in April 2025 where a warrant inducement raised approximately $3.8 million in gross proceeds - The company is developing the Symphony IL-6 test for sepsis and plans to submit a 510(k) application to the FDA in Q4 2027, with potential approval in Q3 2028. This plan is contingent on raising at least $30 million in capital between Q2 2025 and the end of 2027[31] - There is substantial doubt about the Company's ability to continue as a going concern. As of March 31, 2025, the company had an accumulated deficit of $36.5 million and estimates its current cash will only be sufficient to fund operations up to the third quarter of 2025[50] - The company has an exclusive global license (excluding Japan) from Toray Industries for its Symphony detection cartridges. The royalty rate was reduced to 7.5% of net sales. There is a risk Toray could terminate the license as early as November 2025 if the company does not establish a manufacturing facility[59][60][61] - In April 2025, the company entered into inducement agreements with holders of Class C warrants, resulting in the exercise of warrants for gross proceeds of approximately $3.8 million. The company issued new Class E warrants as part of the transaction[94][97] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's focus on the Symphony IL-6 test and the significant financial challenges it faces. The net loss for Q1 2025 was $1.9 million, an improvement from $2.3 million in Q1 2024, due to lower R&D spending. A critical liquidity issue is highlighted, with a going concern uncertainty and an estimated cash runway only until Q3 2025. The company needs to raise at least $30 million by the end of 2027 to execute its strategic plan. Recent financing activities, including a $3.8 million private placement in April 2025, are noted as efforts to address the liquidity shortfall Operating Results Comparison (in millions) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Research and Development | $0.8 | $1.3 | | General and Administrative | $1.1 | $1.1 | | Net Loss | ($1.9) | ($2.3) | - The decrease in R&D expenses was primarily due to a reduction in technology transfer efforts, which offset increased clinical trial expenses[107] - The company has substantial doubt about its ability to continue as a going concern. It estimates current cash resources will only fund operations up to Q3 2025 and failure to obtain additional financing could lead to liquidation[116] - To execute its plan of achieving FDA approval by Q3 2028, the company estimates it needs to raise at least $30 million between Q2 2025 and the end of 2027[100] - In April 2025, the company raised approximately $3.8 million in gross proceeds through a private placement involving the exercise of existing Class C warrants and the issuance of new Class E warrants[127][130] Quantitative and Qualitative Disclosures About Market Risk The company is a smaller reporting company and is not required to provide the information for this item - As a smaller reporting company, Bluejay Diagnostics, Inc. is not required to provide quantitative and qualitative disclosures about market risk[137] Controls and Procedures Management concluded that the company's disclosure controls and procedures were not effective as of March 31, 2025. This was due to a material weakness in internal control over financial reporting identified during the 2024 fiscal year-end audit. The weakness relates to the incorrect accounting and valuation of certain warrants with 'reset' features issued in June 2024. The company plans to remediate this by engaging outside accounting experts for complex financial instruments - The company's disclosure controls and procedures were determined to be not effective as of March 31, 2025[141] - A material weakness was identified related to the accounting and valuation of Class C and Class D warrants issued in June 2024, which had 'reset' features that were not properly accounted for as a 'deemed dividend on warrant modification'[139] - The remediation plan involves engaging outside accounting experts to review and document the appropriate accounting for complex financial instruments like warrants[140] PART II OTHER INFORMATION Legal Proceedings The company reports that it is not currently involved in any legal proceedings - As of the filing date, the company is not involved in any legal proceedings[145] Risk Factors This section supplements existing risk factors, emphasizing the imminent need for additional capital to remain a going concern and the significant risk of liquidation, which would likely result in a total loss for common stockholders. It also highlights risks from recent downsizing to preserve cash, including the loss of key personnel (VP of Operations and CTO), which could negatively impact product redevelopment and timelines - The company is in need of imminent material capital to remain a going concern. Failure to raise funds may lead to liquidation under U.S. bankruptcy laws, where common stockholders are not expected to recoup any material value[146] - To preserve cash, the company has downsized its full-time employee headcount to 6 persons, including separating with its VP of Operations and negotiating a separation with its Chief Technology Officer. This may reduce business continuity and negatively affect product development[147] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None[148] Other Information On May 8, 2025, the company entered into a settlement and release agreement with Nanohybrids, terminating a services agreement and discussions of a potential acquisition. The company agreed to pay Nanohybrids $50,000 plus up to $30,000 in legal fees. Additionally, on May 10, 2025, the company informed its Chief Technology Officer, Jason Cook, of its intent to separate from employment and is currently discussing the terms - On May 8, 2025, the company entered into a settlement agreement with Nanohybrids, terminating a Sharing and Services Agreement and paying $50,000 plus up to $30,000 in legal fees[150] - On May 10, 2025, the company informed its Chief Technology Officer, Jason Cook, of an upcoming separation from employment and is currently discussing the terms[151] Exhibits This section lists the exhibits filed with the Form 10-Q, including the settlement agreement with Nanohybrids, officer certifications (Rule 13a-14(a) and Section 906 of Sarbanes-Oxley), and Inline XBRL data files - Filed exhibits include the Settlement Agreement with Nanohybrids, Inc., CEO/CFO certifications, and XBRL data files[154]