NeuroOne Medical Technologies (US:NMTC)2023-02-13 21:15Financial Performance - As of December 31, 2022, the company had an accumulated deficit of $52.6 million, primarily due to research and development expenses and interest expenses [122]. - The company recognized revenue of $1,455,188 during the three months ended December 31, 2022, related to the completion of the sEEG exclusivity maintenance milestone [139]. - Product revenue for the three months ended December 31, 2022, was approximately $114,579, compared to $33,748 for the same period in 2021, representing an increase of 80,831 [148]. - Collaborations revenue increased significantly to $1,455,188 for the three months ended December 31, 2022, from $6,374 in the prior year, marking an increase of 1,448,814 [148]. - The net loss for the three months ended December 31, 2022, was $1,732,769, a decrease of $1,074,706 compared to a net loss of $2,807,475 for the same period in 2021 [148]. - The net loss for the three months ended December 31, 2022, was $1.7 million, partially offset by approximately $0.3 million in non-cash expenses [173]. - The net decrease in cash for the three months ended December 31, 2022, was $3.5 million, contrasting with an increase of $9.3 million in the same period of 2021 [172]. Expenses and Cash Flow - The company expects to continue incurring significant expenses and increasing operating losses until a higher level of revenue from commercial sales is achieved [123]. - Research and development expenses rose to $1,563,496 for the three months ended December 31, 2022, up from $1,060,462 in the same period of 2021, reflecting an increase of $503,034 [153]. - Selling, general and administrative expenses remained stable at $1,663,737 for the three months ended December 31, 2022, compared to $1,742,141 in the prior year, showing a decrease of $78,404 [148]. - Net cash used in operating activities was $3.5 million for the three months ended December 31, 2022, compared to $2.7 million for the same period in 2021, indicating an increase in cash outflow [173][174]. - Net cash used in financing activities was $16,000 for the three months ended December 31, 2022, compared to net cash provided of $12.0 million in the same period of 2021 [178]. - The cash use from changes in operating assets and liabilities for Q4 2022 was primarily due to a decrease in deferred revenue and an increase in inventory purchases [173]. Development and Agreements - The company commenced commercial sales of cEEG strip/grid and electrode cable assembly products in the first quarter of fiscal year 2021, with sEEG depth electrode products launched in late calendar 2022 [120]. - The company entered into a development and distribution agreement with Zimmer, which included an upfront payment of $2.0 million and a subsequent payment of $3.5 million in August 2022 [134]. - The company is responsible for all development activities under the Zimmer Development Agreement, while Zimmer handles commercialization costs [132]. - The company is targeting the first quarter of 2023 for design verification of new hardware for its diagnostic and ablation depth electrode [119]. - The company anticipates generating additional revenue from the sale of products based on Evo cortical technology [127]. - The company has received FDA 510(k) clearance for its Evo cortical technology and Evo sEEG electrode technology, enhancing its product offerings [118][139]. Future Outlook and Concerns - The company anticipates significant increases in research and development expenses in the coming years to support the development of its cortical strip, grid electrode, and depth electrode technologies [144]. - The company has substantial doubt about its ability to continue as a going concern, necessitating additional funding through equity or debt financings [169]. - The company has been affected by global economic conditions, including the COVID-19 pandemic and increased inflation, which may impact future capital raising efforts [125][126]. - The company has entered into a Capital on Demand Sales Agreement allowing for an aggregate offering price of up to $14.5 million, with no issuances of securities having occurred to date [157]. Accounting and Financial Reporting - The financial statements are prepared in accordance with U.S. generally accepted accounting principles, requiring estimates and judgments that may affect reported amounts [179]. - The company continues to evaluate its accounting policies and practices in light of recent accounting pronouncements [185]. - The company incurred deferred issuance costs related to the ATM in Q4 2022 [178]. - The company has not experienced significant variable consideration adjustments related to product revenue to date [180].