Bluejay Diagnostics, Inc. — FY2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022, compared with FY2021. This is an annual filing; it does not provide standalone Q4 results. Bluejay is a clinical-stage diagnostics company developing its Symphony whole-blood testing platform, initially for IL-6 testing in critical-care settings. Its products had not received FDA authorization for diagnostic marketing.
Financial results and liquidity
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue | $249,040 | $0 |
| Cost of sales / gross profit | $200,129 / $48,911 | $0 / $0 |
| Gross margin | 19.6% | Not applicable |
| Research and development | $4.15 million | $1.15 million |
| General and administrative | $4.76 million | $1.79 million |
| Operating loss | $(9.32) million | $(3.23) million |
| Net loss | $(9.30) million | $(3.49) million |
| Net cash used in operating activities | $(7.74) million | $(4.37) million |
The 2022 revenue was from a one-time sale of five analyzers to Toray, a business partner; management said it did not represent a market launch or indicate expected margins. The company reported an accumulated deficit of $17.0 million.
- Cash and cash equivalents: $10.11 million at December 31, 2022, down from $19.05 million a year earlier; approximately $7.6 million at February 28, 2023.
- Assets and liabilities: Total assets were $13.52 million and total liabilities $1.98 million at year-end. Current liabilities were $1.64 million. Lease liabilities totaled approximately $513,000; the balance sheet showed no conventional notes or debentures outstanding.
- Investing and financing cash flows: Investing used $1.20 million, mainly for lab and manufacturing equipment; financing provided $8,000. FY2021 financing included $18.9 million of net IPO proceeds.
Material changes and management commentary
- Revenue began in 2022 but was limited to the non-recurring Toray analyzer sale. Operating expenses rose substantially: R&D increased about $3.0 million and G&A about $3.0 million versus 2021.
- Management attributed higher R&D spending chiefly to personnel, clinical studies supporting the planned FDA submission, and product testing and manufacturing scale-up. Higher G&A reflected public-company costs and staffing.
- The company expanded clinical studies and continued work with contract manufacturers. Management estimated available cash would fund operations through Q4 2023 under current plans, but said additional capital would be needed for planned operations over the next 12 months. The filing and auditor’s report state that recurring losses and cash outflows raise substantial doubt about the company’s ability to continue as a going concern.
- Management identified approximately $2 million of 2023 capital commitments, in addition to $1.6 million of current liabilities. Financing options discussed include equity, grants, convertible debt, collaborations and strategic arrangements; availability and terms are uncertain.
Outlook, risks and unusual items
- Regulatory and clinical risk: Symphony had no diagnostic marketing authorization. The filing describes a de novo FDA pathway and expanded clinical work; declining COVID-related cases could affect the IL-6 study endpoint, and the company was working with FDA on endpoint and study-size adjustments. Study delays or results that do not meet objectives could delay or prevent commercialization.
- Toray license and supply: The license covers core cartridge technology and provides for royalties of 15% of net sales after regulatory approval, with minimum annual royalties thereafter. The filing says US and EU market approval was required by October 2023 under the agreement or Toray could terminate it. Toray’s stated cartridge-supply commitment ran through October 2024; future supply and manufacturing scale-up remain important risks.
- Funding and listing: The company reported no committed additional financing. Nasdaq had notified Bluejay in October 2022 that its share price was below the $1.00 minimum bid-price requirement; the initial compliance period ran to April 24, 2023, with a possible extension subject to conditions.
- Other key risks: Limited operating history and no established product sales; competition, reimbursement, reliance on third-party manufacturers and suppliers, and dependence on Toray’s licensed intellectual property. The company also cited supply-chain and inflation pressures.
- Unusual items and related parties: The statements report a $237,309 property-and-equipment impairment; MD&A describes the charge as approximately $210,000. Other income included $163,256 earned under an agreement with NanoHybrids, which is wholly owned by the company’s CTO.
- The independent auditor issued an unmodified opinion on the financial statements with a going-concern emphasis. Management concluded disclosure controls and internal control over financial reporting were effective; the auditor was not engaged to attest to internal-control effectiveness.
Investor verification priorities
- Confirm cash use since year-end, committed financing, and whether the company can fund operations and its 2023 commitments without delaying development.
- Check FDA pathway, clinical-study progress and endpoint changes, and any regulatory authorization or updated timetable.
- Review the Toray agreement’s approval deadlines, termination provisions, cartridge supply arrangements and manufacturing readiness.
- Verify Nasdaq bid-price compliance and any extension, reverse split or other listing developments.
- Reconcile the impairment amount cited in the financial statements and MD&A, and assess the nature and ongoing terms of the CTO-related NanoHybrids arrangement.
- Assess potential dilution from outstanding warrants, options and any future equity financing.