Filing summary
Entity discrepancy: The request identifies Streamex Corp., but the supplied Form 10-Q is for BioSig Technologies, Inc. This summary reflects the filing provided, not a Streamex filing.
Business context and reporting period
Quarterly period ended June 30, 2018. BioSig is a development-stage medical-device company developing the PURE EP System for cardiac electrophysiology procedures. It reported no revenue and had no commercial products or customers at the period end. The financial statements are unaudited.
Financial performance and position
| Metric | Three months ended June 30, 2018 | Six months ended June 30, 2018 |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $1.45 million | $2.31 million |
| General and administrative expense | $4.31 million | $6.09 million |
| Total operating expenses | $5.77 million | $8.40 million |
| Net loss | $5.77 million | $8.40 million |
| Net loss available to common stockholders | $6.05 million | $8.99 million |
| Basic and diluted loss per share | $0.18 | $0.28 |
For the six months, operating cash outflow was $4.80 million, investing cash outflow was $266,444, and financing cash inflow was $7.19 million. Cash increased to $3.67 million from $1.55 million at December 31, 2017. Working capital was $3.31 million. Current liabilities were $525,232; the company reported no convertible debentures outstanding. No income-tax expense or cash interest payments were reported. Profit margins are not applicable because the company had no revenue.
Changes versus the prior comparable period
- Second-quarter operating expenses rose 91% year over year, driven mainly by G&A, including substantially higher stock-based compensation and added commercialization and support staff. G&A increased 157%; R&D increased 8%.
- For the first six months, operating expenses increased 42%. G&A rose 88%, while R&D declined 14%, partly because the prior-year period included $543,927 of acquired R&D and more outside design work.
- Six-month net loss available to common stockholders increased to $8.99 million from $6.40 million. Preferred dividends rose to $585,913 from $46,608.
- Operating cash use increased to $4.80 million from $3.45 million. Financing provided $7.19 million, versus $3.28 million in the prior-year period.
- Common shares outstanding rose to 36.71 million from 29.32 million at year-end 2017. Equity financing and conversions of preferred stock and accrued dividends contributed to the increase.
Outlook, risks, and unusual items
- Going concern and funding: The filing states that substantial doubt exists about the company’s ability to continue as a going concern. Management believed available funds would cover at least six months of R&D and other requirements, but also said approximately $8 million in addition to cash on hand would be needed for the next 12 months. The company expects continued losses and requires additional financing; failure to obtain it could force delays or reductions in development and commercialization.
- Regulatory and product risk: BioSig filed a 510(k) application for PURE EP in March 2018 and said it believed it could obtain FDA marketing clearance by year-end 2018 and begin commercialization. This was management’s expectation, not an assurance. The company planned to submit for CE marking in 2019. Product approval, technical success, and commercial viability remained uncertain.
- Post-period financing: Subsequent to June 30, the company reported approximately $900,000 raised, including a July unit offering with net proceeds of $477,801 and warrant exercises. Other July share issuances and exercises also increased shares outstanding or generated proceeds.
- Accounting change: Adoption of ASU 2017-11 reclassified $3.04 million of warrant and derivative liabilities to equity on January 1, 2018. The company reported no such liabilities at June 30.
- Stock-based compensation and dilution: Six-month equity-based compensation was $3.95 million. At June 30, 23.68 million potentially dilutive securities were excluded from diluted loss per share as anti-dilutive.
- Controls: Management concluded disclosure controls and procedures were not effective as of June 30, 2018; it reported no material changes to internal control over financial reporting during the quarter.
- Commitments and related parties: Future minimum lease payments totaled $603,320 through 2021. A director’s business partner provided services under an agreement involving cash fees and stock options. No legal proceedings were reported.
Important facts for investors to verify
- Confirm the filing is for BioSig Technologies, Inc., not Streamex Corp., and verify the intended issuer and reporting period.
- Check subsequent filings for actual FDA review outcomes, commercialization timing, and any regulatory or clinical developments.
- Review cash burn, financing completed after quarter-end, and the company’s ability to meet the stated $8 million funding need.
- Assess potential dilution from outstanding options, warrants, preferred stock, and future financing.
- Review disclosures explaining the ineffective controls and whether remediation has been completed.