Bluejay Diagnostics, Inc. — Q2 2023 Form 10-Q
Reporting period: Three and six months ended June 30, 2023; filed August 14, 2023. Bluejay is a clinical-stage medical diagnostics company developing its Symphony platform and IL-6 test. The products do not yet have FDA marketing authorization, and the company reported no revenue in the period.
Financial performance and liquidity
| Metric | Q2 2023 | Q2 2022 | Six months 2023 | Six months 2022 |
|---|---|---|---|---|
| Revenue | $0 | $249,040 | $0 | $249,040 |
| Operating expenses | $2.90 million | $2.03 million | $5.58 million | $4.10 million |
| Operating loss | $2.90 million | $1.99 million | $5.58 million | $4.05 million |
| Net loss | $2.81 million | $1.94 million | $5.35 million | $3.95 million |
| Net loss per share | $2.75 | $2.00 | $5.24 | $2.00 |
- Prior-year revenue and gross profit of $249,040 and $48,911, respectively, came from a one-time sale of five Symphony analyzers to Toray. No further sales to Toray were anticipated. No gross margin was reported for 2023 because revenue was zero.
- At June 30, cash and cash equivalents were $5.10 million, down from $10.11 million at December 31, 2022. Current assets were $6.58 million and current liabilities $1.83 million. Total liabilities were $2.10 million; the filing reports lease liabilities, but no conventional borrowing balance is presented.
- For the first half, operating cash use was $4.41 million, investing cash use $542,000, and financing cash use $61,000. Capital spending was primarily for manufacturing equipment. Accumulated deficit was $22.35 million.
- Management estimated cash would fund operations into Q4 2023 and said additional capital was needed for planned operations over the next 12 months. The filing identifies substantial doubt about the company’s ability to continue as a going concern.
Changes, outlook, and risks
- First-half R&D expense rose to $3.03 million from $1.45 million, primarily due to personnel and product-development costs. G&A declined to $2.25 million from $2.52 million; sales and marketing increased to $302,000 from $135,000.
- Management shifted the initial Symphony IL-6 clinical focus away from COVID-19 and toward risk stratification of hospitalized sepsis patients. Following an August 11, 2023 FDA pre-submission meeting, FDA identified 510(k) as the appropriate pathway and requested specified data. The company expected to maintain its first-half 2024 submission timeline; timing and clearance are not assured.
- Management expects R&D spending to focus on clinical trials and manufacturing improvements, while continuing to monitor and pare G&A spending. It may seek equity, grants, convertible debt, collaborations, or other financing. Funding may be unavailable or may require giving up rights; insufficient funding could delay development, trials, manufacturing, or commercialization.
- Key risks include FDA review and clinical results, availability and quality of cartridges from contract manufacturers Toray and Sanyoseiko, and the need for additional financing. Disclosed non-cancelable purchase commitments totaled $1.379 million. Management separately cited approximately $1.9 million of commitments in its liquidity discussion.
- Lab-equipment useful-life estimates were revised, resulting in approximately $247,000 of additional depreciation in the first half. Other income included related-party income from NanoHybrids, owned by the company’s Chief Technology Officer; first-half income from NanoHybrids was $136,773.
- After quarter-end, the company implemented a 1-for-20 reverse stock split on July 24, 2023. Nasdaq notified it on August 8 that it had regained compliance with the minimum bid-price requirement.
Investor verification points
- Confirm cash runway, financing plans, and whether new capital was secured; the filing says cash was expected to last only into Q4 2023.
- Track clinical-trial execution, FDA-requested data, and whether the targeted first-half 2024 510(k) submission timeline remains achievable.
- Reconcile the six-month net loss: the financial statements report $5,353,148, while one MD&A table shows $5,252,148; the statements also report $5,353,148 elsewhere in the filing.
- Assess manufacturing commitments, supplier readiness, and the potential for trial delays or additional costs.
- Review related-party arrangements and the effect of the July reverse split on share counts and per-share comparisons.