Filing summary
Entity warning: The supplied filing is BioSig Technologies, Inc. (Nasdaq: BSGM), not Streamex Corp. It is a Form 10-Q for the quarter ended June 30, 2021, filed August 11, 2021. Amounts below are in thousands of dollars unless stated otherwise.
Business context and reporting period
BioSig is commercializing the PURE EP cardiac signal acquisition and processing system. It reported its first commercial sales in 2021; the company also has majority-owned subsidiaries ViralClear and NeuroClear. ViralClear had been redirected to antiviral drug development in 2020 and was subsequently returned to pursuing applications of PURE EP technology. The financial statements are unaudited and cover the three and six months ended June 30, 2021, compared with the same 2020 periods.
Financial performance and position
| Metric | Q2 2021 | Q2 2020 | Six months 2021 | Six months 2020 |
|---|---|---|---|---|
| Revenue | $207 | $0 | $325 | $0 |
| Gross profit (margin) | $145 (70.1%) | $0 | $164 (50.5%) | $0 |
| Operating expenses | $8,196 | $22,348 | $16,775 | $35,152 |
| Net loss attributable to BioSig common shareholders | $(7,704) | $(19,193) | $(16,025) | $(30,533) |
| Basic and diluted loss per share | $(0.24) | $(0.72) | $(0.50) | $(1.20) |
Revenue comprised PURE EP product sales of $199 in Q2 and $314 for the six months, plus service revenue of $8 and $11, respectively. The six-month operating loss was $16,611. No income tax expense or benefit was reported.
For the six months, operating cash use was $13,910 versus $14,223 in 2020; investing cash use was $182 versus $28; and financing provided $1,328 versus $39,070. Cash fell from $28,268 at December 31, 2020 to $15,504 at June 30, 2021. Working capital was approximately $13,566. Total liabilities were $3,405, including $248 of lease liabilities; there was no convertible debenture debt outstanding. Series C preferred stock had a $105 stated value and cumulative 9% dividends.
Material changes versus the prior period
- Commercial revenue began in 2021, while the comparable 2020 periods had no revenue. Six-month gross margin was 50.5%, though revenue remained small relative to operating costs.
- Six-month R&D expense fell 72.4% to $2,933, and G&A fell 43.8% to $13,751. Management attributed much of the reductions to curtailed ViralClear pharmaceutical activity and lower acquired R&D and stock-based compensation costs.
- Six-month common-shareholder loss improved to $16,025 from $30,533. Weighted-average common shares increased to 31.9 million from 25.5 million, reflecting share issuance and compensation awards.
- Cash at June 30 was $15,504, compared with $36,927 at June 30, 2020; financing inflows were substantially lower than in the prior-year period.
Outlook, commentary, risks, and unusual items
- Management expected continued operating losses and negative operating cash flow while PURE EP commercialization and product development proceed. It stated that cash at quarter-end, together with approximately $9.1 million raised after quarter-end and expected commercial growth, should fund requirements for at least 12 months from issuance of the financial statements.
- COVID-19 disruptions had delayed commercialization objectives into 2022. Management cited uncertainty around the pandemic, market demand, competition, pricing, regulatory timing, and access to capital. It warned that unavailable or unacceptable financing could require reduced or delayed development and commercialization.
- On July 2, 2021, BioSig agreed to sell 2.5 million common shares at $4.00 per share; the offering closed July 7 and generated approximately $9.1 million net. The underwriter also received warrants for 125,000 shares at $4.80; its option for additional shares was not exercised. This post-quarter financing increased the share count.
- The PURE EP 2.0 study completed enrollment with 51 procedures across three centers. The company reported 93.6% of signals rated superior or equivalent to conventional sources; the manuscript was under review for publication. Management anticipated ISO 13485 audit activity in the second half of 2021 and CE marking in the first half of 2022, subject to notified-body guidance.
- Aurigene sued BioSig and ViralClear, alleging $1.53 million in unpaid milestone and service payments. BioSig disputed liability and the claims, and said it intended to defend the case. The filing does not state a quantified loss accrual for this matter.
- Other notable items include $2.36 million of future purchase commitments, some modifiable or cancellable; Series C preferred-stock redemption triggers that could create a payment obligation the company says it might be unable to meet; and director option/RSU modifications that generated compensation charges.
Investor verification priorities
- Confirm the issuer identity: this document is BioSig Technologies, Inc., not Streamex Corp.
- Verify customer concentration and repeatability of sales: one customer represented about 96% of Q2 revenue, and two customers represented all six-month revenue; one customer held all period-end receivables.
- Track cash burn, the post-quarter financing proceeds and dilution, and whether management’s stated liquidity runway assumptions remain achievable.
- Assess whether PURE EP sales scale beyond initial customers and whether reported clinical findings are published and validated.
- Follow the $1.53 million Aurigene litigation, purchase commitments, Series C redemption terms, and regulatory milestones.