BioSig Technologies, Inc. — Q1 2022 Form 10-Q
Entity note: The request identifies Streamex Corp., but the supplied filing is BioSig Technologies, Inc.’s Form 10-Q for the quarter ended March 31, 2022. The summary below reflects the filing provided.
Business context and reporting period
BioSig is commercializing its PURE EP system, a medical-technology platform for cardiac electrophysiology procedures. It reported minimal revenue to date and operates at an early commercialization stage. ViralClear, 68.44%-owned, is focused on applications of the company’s core technology beyond cardiac electrophysiology; BioSig says it does not currently intend to further develop ViralClear’s COVID-19 drug candidate merimepodib. Financial statements are unaudited and cover the three months ended March 31, 2022, compared with the same period in 2021.
Key financial results
| Metric | Q1 2022 | Q1 2021 |
|---|---|---|
| Revenue | $8,000 | $118,000 |
| Gross profit | $8,000; 100.0% margin | $19,000; 16.1% margin |
| Operating expenses | $8.073 million | $8.579 million |
| Operating loss | $8.065 million | $8.560 million |
| Net loss attributable to common shareholders | $7.965 million; $0.22 per share | $8.321 million; $0.26 per share |
| Cash used in operating activities | $5.941 million | $6.991 million |
| Cash provided by financing activities | $3.002 million | $1.328 million |
At March 31, 2022, cash was $8.665 million, working capital was $8.293 million, total assets were $12.542 million, and total liabilities were $3.027 million. Current liabilities were $2.709 million. Lease liabilities totaled $570,000 ($252,000 current); the company reported no convertible debentures outstanding. The balance sheet also included $105,000 of Series C convertible preferred stock.
Changes versus the prior comparable period
- Revenue fell 93% year over year: Q1 2022 revenue consisted of $8,000 in services, with no product sales, versus $115,000 in product sales and $3,000 in services in Q1 2021. One customer accounted for approximately 100% of revenue in both periods.
- R&D expense rose 27.7% to $1.617 million, primarily reflecting higher staffing costs. General and administrative expense fell 12.0% to $6.401 million, including lower stock-based compensation and consulting, marketing, and investor-relations costs, partly offset by higher payroll and travel.
- Operating cash use improved by $1.050 million. Cash declined by $2.994 million during Q1 2022, compared with a $5.793 million decline in Q1 2021.
- Common shares outstanding increased from 35.567 million at December 31, 2021 to 39.559 million at March 31, 2022. A March registered direct offering issued 2.613 million shares and warrants for up to 2.613 million additional shares, raising approximately $3.0 million gross.
Outlook, risks, contingencies, and unusual items
- Going concern: Management states that recurring losses and negative operating cash flows raise substantial doubt about the company’s ability to continue as a going concern. It expects further losses and says additional financing will be required. Potential funding sources include equity, debt, and strategic partnerships; no assurance is given that funding will be available on acceptable terms.
- Commercialization and regulation: Management described a commercial launch for the latter part of 2022. The filing says the COVID-19 pandemic had delayed commercialization objectives into mid-2022. The ISO 13485 audit was completed in Q1; certification was expected in the first half of 2022, with a European CE-mark application targeted for the first half of 2023, subject to notified-body guidance and availability.
- Costs and market risks: The company expects continuing marketing, commercialization, R&D, and clinical-trial costs. It cites pandemic-related uncertainty, supply-chain dependence on limited suppliers and manufacturers, and market volatility, including geopolitical disruption, as risks to operations and access to capital.
- Commitments and claims: Future purchase commitments were approximately $2.697 million, some modifiable or cancellable. A $1.0 million Aurigene settlement was payable in three installments; the final $300,000 remained accrued at March 31, 2022. The company also disclosed potential royalties and milestone payments under license agreements.
- Preferred-stock triggers: Series C preferred-stock provisions may require redemption after specified triggering events; the filing warns the company may not be able to meet a redemption demand.
- Other items: Equity-based compensation was $2.0 million in Q1 2022. Management reported effective disclosure controls and no material change in internal control over financial reporting during the quarter.
Most important facts for investors to verify
- Whether the supplied BioSig filing is the intended filing, given the Streamex Corp. request metadata.
- Cash runway, subsequent financing needs, and progress toward resolving the stated going-concern uncertainty.
- PURE EP system sales, customer concentration, and whether the anticipated commercialization and European regulatory milestones were achieved.
- The impact of the March offering and warrants, outstanding equity awards, and potential future dilution.
- Payment status of the Aurigene settlement and the amount, timing, and cancellability of purchase and licensing commitments.