Bluejay Diagnostics, Inc. — Q2 2022 Form 10-Q
Reporting period: Three and six months ended June 30, 2022. Unaudited consolidated results are compared with the corresponding 2021 periods. Bluejay develops near-patient diagnostic products, including the Symphony platform and IL-6 test.
Financial highlights
| Metric | Q2 2022 | Q2 2021 | Six months 2022 | Six months 2021 |
|---|---|---|---|---|
| Revenue | $249,040 | $0 | $249,040 | $0 |
| Gross profit (margin) | $48,911 (19.6%) | $0 | $48,911 (19.6%) | $0 |
| Operating expenses | $2.035 million | $666,072 | $4.103 million | $899,270 |
| Operating loss | $1.986 million | $666,072 | $4.054 million | $899,270 |
| Net loss | $1.937 million | $640,233 | $3.951 million | $834,421 |
| Basic and diluted loss per share | $0.10 | $0.15 | $0.20 | $0.20 |
- Revenue came from a one-time sale of five Symphony analyzers to business partner Toray for $249,040; the company said it did not anticipate future Toray sales. No Toray Cartridge sales were reported.
- Operating cash use was $3.536 million in the first half, versus $728,801 in 2021. Investing cash use was $169,599, mainly for laboratory equipment. There were no financing cash flows in the 2022 period.
- Cash and cash equivalents were $15.342 million at June 30, down from $19.048 million at December 31, 2021. Accumulated deficit was $11.651 million.
- Total assets were $18.067 million; total liabilities were $1.410 million, including $601,647 in operating lease liabilities. The balance sheet reports no debt. Current assets of $17.050 million substantially exceeded current liabilities of $979,590.
- Net loss per share comparisons reflect the company’s retroactive adjustment for its 2021 stock split. Shares outstanding were 20,152,344 at June 30, 2022; potentially dilutive securities were excluded from diluted loss per share as antidilutive.
Changes and management commentary
- First-half R&D expense rose to $1.451 million from $250,175, primarily reflecting advancement of clinical studies and support for scale-up manufacturing of the Symphony IL-6 test.
- First-half general and administrative expense increased to $2.517 million from $529,741, reflecting investment in infrastructure and public-company costs following the November 2021 IPO. Sales and marketing expense was $135,042, versus $119,354.
- Management expects near-term losses to continue. It stated that cash should fund operations for at least 12 months from the financial-statement date, including its plan for Symphony IL-6 regulatory approval and initial commercialization, while also saying it expects to seek additional capital and cannot assure it will obtain it.
- The company described Symphony as a near-patient system intended to deliver results in approximately 20 minutes; it noted that FDA clearance, authorization, or approval is required for the relevant intended use. ALLEREYE received FDA clearance in 2017.
Risks, contingencies, and other items
- Risks cited include regulatory and commercialization execution, competition, dependence on key personnel, inflation, and global supply-chain disruption. The filing reported no material changes to the risk factors in the 2021 Form 10-K.
- Non-cancelable purchase commitments, primarily for inventory and advisory/product-development services, totaled approximately $600,000 and were due within one year.
- ASC 842 adoption on January 1, 2022 resulted in initial right-of-use assets and lease liabilities of approximately $200,000; the company said adoption did not materially affect operations or cash flows.
- Related-party activity included $75,926 of first-half income from NanoHybrids, an entity wholly owned by the Chief Technology Officer; $35,040 remained receivable at June 30.
- The company reported no current legal proceedings. Management concluded disclosure controls were effective as of June 30, 2022, with no material change in internal control over financial reporting during the quarter.
Important facts for investors to verify
- Whether cash burn remains consistent with management’s stated 12-month runway, particularly as R&D, commercialization, and purchase commitments continue.
- Regulatory milestones and timing for the Symphony IL-6 test, and whether the company can establish recurring product and cartridge revenue after the one-time Toray analyzer sale.
- Future financing needs and potential dilution from outstanding options and warrants, including 2.484 million Class A warrants and 805,805 options reported at June 30.
- The status and economics of the Toray license and supply agreement, including its royalty and minimum-royalty terms when qualifying sales begin.