enVVeno Medical Corporation — Q1 2023 Form 10-Q
Reporting period: Three months ended March 31, 2023. Financial statements are unaudited. enVVeno is a late clinical-stage medical-device company developing replacement venous valves for severe chronic venous insufficiency (CVI). Its lead product, surgical VenoValve, is in a U.S. pivotal study; the company is awaiting regulatory approval to begin a first-in-human study of its transcatheter enVVe device.
Key financial results
Amounts below are in millions, except per-share data.
| Metric | Q1 2023 | Q1 2022 / comparison |
|---|---|---|
| Revenue | None | None; no commercial revenue |
| Operating expenses | $6.797 | $5.335; up $1.462 (27%) |
| Research and development | $3.595 | $1.552; up $2.043 (132%) |
| Selling, general and administrative | $3.202 | $3.783; down $0.581 (15%) |
| Loss from operations | $6.797 | $5.335 |
| Other income | $0.405 | $0.005 |
| Net loss | $6.392 | $5.330; loss increased $1.062 (20%) |
| Basic and diluted loss per share | $0.57 | $0.47 |
| Net cash used in operating activities | $5.109 | $3.321 |
Gross profit and margins are not applicable because the company reported no revenue. Other income in 2023 included realized and unrealized gains on Treasury investments and interest income. R&D expense growth primarily reflected $1.6 million of SAVVE study costs, plus lab, personnel, and travel costs. Lower SG&A mainly reflected reduced share-based compensation and lower franchise taxes and outside services.
Liquidity, cash flow, and obligations
- At March 31, 2023, cash and cash equivalents were $2.273 million and short-term investments were $31.934 million, totaling about $34.2 million. Working capital was $33.4 million.
- Cash and investments declined from approximately $39.1 million at year-end 2022. Operating activities used $5.109 million; investing activities provided $2.827 million, principally from Treasury bill maturities, partly offset by purchases.
- Total liabilities were $2.484 million, largely operating lease liabilities; the filing reports no borrowings or other financial debt. The company cited facility lease costs of about $0.4 million per year.
- Management estimated a cash burn rate of $4–5 million per quarter and said available resources should fund operations through the end of 2024 and into 2025. It also stated resources were sufficient to meet obligations for at least one year after the report date. Additional capital may ultimately be needed.
- As of April 26, 2023, cash was $2.8 million and investments were $31.0 million. The filing reports $2.0 million of uninsured bank cash at quarter-end.
Business developments, outlook, and risks
- The 75-patient SAVVE U.S. pivotal trial evaluates VenoValve. After FDA review of preliminary safety data for the first 20 patients, the study was cleared to continue without modification or interruption. Management said hospital staffing shortages have affected trial enrollment and progress; it hired four clinical technologists to support study sites.
- Management expected SAVVE primary endpoint data—30-day safety and six-month effectiveness after full enrollment—before the company would need to raise additional capital. Trial timing and enrollment remain important uncertainties.
- The enVVe program was awaiting regulatory approval to start its planned initial 3–5-patient first-in-human study in Colombia. Neither product has FDA approval; commercial success and revenue depend on clinical and regulatory outcomes.
- The company expects continued losses and does not expect significant revenue until successful commercialization. Management cautioned that inability to obtain additional financing, if needed, would materially harm the company.
- A former employee’s consolidated lawsuits allege employment, defamation, labor-law, discrimination, and related claims. The company denies the claims and has filed a counterclaim. Trial was scheduled for October 30, 2023; any loss could not be reasonably estimated, and no amount was accrued.
- Share-based compensation was $1.792 million in Q1 2023; $6.6 million of unrecognized option compensation remained, expected to be recognized over a weighted-average 1.7 years. The company disclosed 8.795 million potentially dilutive warrant and option shares excluded from diluted loss per share.
Most important facts for investors to verify
- Current cash and investment balances, quarterly cash burn, and whether the stated runway remains achievable.
- SAVVE enrollment pace, trial endpoint timing, and any subsequent safety findings or FDA communications.
- Regulatory progress and timing for the enVVe first-in-human study.
- Potential financing needs and dilution, including the substantial excluded warrant and option equivalents.
- Developments and potential exposure in the Rankin litigation.