Note
2 – Management’s Liquidity Plan
As
of March 31, 2023, the Company had a cash and investment balance of $34.2 million and working capital of $33.4 million. Although the
Company expects to continue incurring losses for the foreseeable future and may need to raise additional capital to sustain its operations,
pursue its product development initiatives and penetrate markets for the sale of its products, Management believes that our capital resources
at March 31, 2023 are sufficient to meet our obligations as they become due within one year after the date of this Quarterly Report,
and sustain operations.
Note
3 – Significant Accounting Policies
Basis
of Presentation
The
accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted
in the United States of America (“GAAP”) for interim financial information and Article 8 of Regulation S-X. Accordingly,
they do not include all of the information and disclosures required by accounting principles generally accepted in the United States
of America for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only
of normal recurring items) which are considered necessary for a fair presentation of the unaudited condensed financial statements of
the Company as of March 31, 2023 and December 31, 2022, and for the three months ended March 31, 2023 and 2022.
The
results of operations for the three months ended March 31, 2023 are not necessarily indicative of the operating results for the full
year. These unaudited condensed financial statements should be read in conjunction with the financial statements and notes thereto
for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 2, 2023.
The accompanying condensed balance sheet as of December 31, 2022 has been derived from the Company’s audited financial
statements.
ENVVENO
MEDICAL CORPORATION
NOTES
TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
Note
4 – Concentrations
The
Company maintains cash with major financial institutions. Cash held in United States bank institutions is currently insured by the
Federal Deposit Insurance Corporation (“FDIC”) up to $250,000
at each institution. There were aggregate uninsured cash balances of $2.0
million and $4.3
million as of March 31, 2023 and December 31, 2022, respectively.
Note
5 – Property and Equipment
As
of March 31, 2023 and December 31, 2022, property and equipment consist of the following:
Schedule
of Property and Equipment
| (In thousands) | |
March 31, | | |
December 31, | |
| | |
2023 | | |
2022 | |
| Laboratory equipment | |
$ | 524 | | |
$ | 524 | |
| Furniture and fixtures | |
| 160 | | |
| 160 | |
| Computer equipment | |
| 227 | | |
| 222 | |
| Leasehold improvements | |
| 213 | | |
| 213 | |
| Software | |
| 251 | | |
| 251 | |
| Total property and equipment | |
| 1,375 | | |
| 1,370 | |
| Less: accumulated depreciation | |
| (903 | ) | |
| (849 | ) |
| Property and equipment, net | |
$ | 472 | | |
$ | 521 | |
Depreciation
expense amounted to $0.1 million for the three months ended March 31, 2023 and 2022. Depreciation expense is reflected in general and
administrative expenses in the accompanying statements of operations.
ENVVENO
MEDICAL CORPORATION
NOTES
TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
Note
6 – Accounts Payable Accrued Expenses and Other Current Liabilities
As
of March 31, 2023, and December 31, 2022, accounts payable, accrued expenses and other current liabilities consist of the
following:
Schedule
of Accrued Expenses and Other Current Liabilities
| (In thousands) | |
March 31, | | |
December 31, | |
| | |
2023 | | |
2022 | |
| Accounts payable | |
$ | 380 | | |
$ | 648 | |
| Accrued compensation costs | |
| 362 | | |
| 391 | |
| Accrued professional fees | |
| 22 | | |
| 62 | |
| Accrued research and development | |
| - | | |
| 56 | |
| Other accrued expenses | |
| 83 | | |
| 59 | |
| Total accrued expenses and other current liabilities | |
$ | 847 | | |
$ | 1,216 | |
Note
7 – Commitments and Contingencies
Litigations
Claims and Assessments
In
the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course
of business. The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable
settlements.
Robert
Rankin Complaints
On
July 9, 2020, the Company was served with a civil complaint filed in the Superior Court for the State of California, County of Orange
by a former employee, Robert Rankin, who resigned his employment on or about March 30, 2020. The case is entitled Rankin v. Hancock Jaffe
Laboratories, Inc. et al., Case No. 30-2020-01146555-CU-WR-CJC and was filed on May 27, 2020. On September 3, 2020 the Company and its
Chief Executive Officer were served with a second complaint filed in the Superior Court for the State of California, County of Orange
by Mr. Rankin. The case is entitled Rankin v. Hancock Jaffe Laboratories, Inc. et al., Case No. 30-2020-01157857 and was filed on August
31, 2020.
The complaints assert several causes of action including a cause of action for failure to timely pay Mr. Rankin’s accrued
and unused vacation and three months’ severance under his July 16, 2018 employment agreement, defamation, unlawful labor code violations,
sex-based discrimination, and unfair competition, and seeks damages for lost wages, emotional and mental distress, consequential damages,
punitive damages and attorney’s fees and costs.
The
Company has denied all claims in both matters (which have now been consolidated) and has filed a counterclaim asserting that Rankin
has breached his employment agreement with the Company to the Company’s damage. The Company continues to believe it has
meritorious defenses to both matters which are currently set for trial on October 30, 2023.
As of the date of these financial statements, the amount of loss associated with these
complaints, if any, cannot be reasonably estimated. Accordingly, no amounts related to these complaints are accrued as of March 31,
2023.
ENVVENO
MEDICAL CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
Note
8 –Stockholders’ Equity
Stock
Options
From
time to time, the Company issues options for the purchase of its common stock to employees and others. The Company recognized $1.8
million and $2.2
million of share-based compensation related to stock options during the three months ended March 31, 2023 and 2022, respectively. As
of March 31, 2023, there was $6.6
million of unrecognized share-based compensation expense related to outstanding stock options that will be recognized over the
weighted average remaining vesting period of 1.7 years. Share-based compensation is reflected in selling, general and administrative expenses in the accompanying condensed statements of operations.
Note
9 – Net Loss per Share
The
following table summarizes the number of potentially dilutive common stock equivalents excluded from the calculation of diluted net loss
per common share as of March 31, 2023 and 2022:
Schedule
of Dilutive Net Loss Per Common Share
| | |
2023 | | |
2022 | |
| (In thousands) | |
March 31, | |
| | |
2023 | | |
2022 | |
| Shares of common stock issuable upon exercise of warrants | |
| 4,589 | | |
| 4,553 | |
| Shares of common stock issuable upon exercise of options | |
| 4,206 | | |
| 3,454 | |
Potentially dilutive common stock equivalents excluded from diluted net loss per share
| |
| 8,795 | | |
| 8,007 | |
Item
2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The
following discussion should be read in conjunction with our unaudited condensed financial statements and notes thereto included herein.
In connection with, and because we desire to take advantage of, the “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995, we caution readers regarding certain forward-looking statements in the following discussion and elsewhere in this
report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission.
Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial
results or other developments. Such forward-looking statements involve significant risks and uncertainties. Forward looking statements
are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties
and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to
change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those
expressed in any forward-looking statements made by, or on our behalf. Words such as “anticipate,” “estimate,”
“plan,” “continuing,” “ongoing,” “expect,” “believe,” “intend,”
“may,” “will,” “should,” “could,” and similar expressions are used to identify forward-looking
statements. Such forward-looking statements also involve other factors which may cause our actual results, performance or achievements
to materially differ from any future results, performance, or achievements expressed or implied by such forward-looking statements and
to vary significantly from reporting period to reporting period. Although management believes that the assumptions made and expectations
reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove
to be correct or that actual future results will not be different from the expectations expressed in this Quarterly Report. We undertake
no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise,
except as required by applicable law.
Unless
the context requires otherwise, references in this document to “NVNO”, “we”, “our”, “us”
or the “Company” are to enVVeno Medical Corporation
Overview
enVVeno
Medical Corporation is a late clinical-stage med-tech company focused on the advancement of innovative bioprosthetic (tissue-based)
solutions to improve the standard of care for the treatment of venous disease. Chronic Venous Disease (CVD) is the world’s
most prevalent chronic disease, impacting approximately 71% of the adult population of the U.S. Chronic Venous Insufficiency (CVI),
is a large subset of CVD, which most often occurs when valves inside of the veins of the leg become damaged, resulting in the
backwards flow of blood (reflux), blood pooling in the lower leg, increased pressure in the veins of the leg (venous hypertension)
and in severe cases, venous ulcers that are difficult to heal. The Company is developing surgical and non-surgical replacement
venous valves for patients suffering from severe CVI of the deep venous system of the leg.
The
Company’s lead product is the VenoValve®, which is a first-in-class surgical replacement venous valve that is currently being
evaluated in a U.S. pivotal study. The Company is also developing a second product called enVVe™, which is a first-in-class, non-surgical,
transcatheter based replacement venous valve. The Company is currently waiting for regulatory approval to begin a first-in-human study
for enVVe. Both the VenoValve and enVVe are designed to act as one-way valves, to help assist in propelling blood up the veins of the
leg, and back to the heart and lungs.
The
VenoValve and enVVe are being developed first for approval by the U.S. Food and Drug Administration (FDA). We expect the VenoValve to
be eligible for FDA approval first, followed two to three years later by enVVe. If approved, we expect the VenoValve and enVVe to co-exist,
with the VenoValve as a surgical replacement venous valve option and enVVe as a non-surgical replacement venous valve option, although we cannot provide any assurance that either the VenoValve or enVVe will receive approval from the FDA
(see the section entitled “Risk Factors” in our Annual Report on Form 10-K). There are
currently no devices approved as surgical or non-surgical replacement venous valves, and there are no effective treatments for deep venous
CVI caused by incompetent valves.
Our
team of officers and directors has been affiliated with numerous medical devices that have received FDA approval or CE marking and that
have been commercially successful. We develop and manufacture our products in a 14,507 sq. ft. leased manufacturing facility in Irvine,
California, which has been ISO 13485-2020 certified for the design, development and manufacturing of tissue based implantable medical
devices.
CVI
Background
Chronic
venous disease (“CVD”) is the world’s most prevalent chronic disease. CVD is generally classified using a standardized
system known as CEAP (clinical, etiological, anatomical, and pathophysiological). The CEAP system consists of seven clinical classifications
(C0 to C6) with C4, C5 and C6 being the most severe categories of CVD.
Chronic
Venous Insufficiency (“CVI”) is a large subset of CVD and is generally used to describe patients with C4 to C6 CVD. CVI is
a debilitating condition that affects the venous system of the leg causing pain, swelling, edema, skin changes, and ulcerations.
The
human leg contains three vein systems: the deep vein system, the superficial vein system, and the perforator vein system which connects
the deep system to the superficial system. The deep venous system is located below the muscle and facia in the center portion of the
leg and is responsible for approximately 90% of the blood flow. In order for blood to return to the heart from the foot, ankle, and lower
leg, the calf muscle serves as a pump and pushes the blood up the veins of the leg against gravity and through a series of one-way valves.
Each valve is supposed to open as blood passes through, and then close as blood progresses up the veins of the leg to the next valve.
CVI occurs when the one-way valves in the veins of the leg fail and become incompetent. When the valves fail, gravity causes the blood
to flow backwards and in the wrong direction (reflux). As blood pools in the lower leg, pressure inside the veins increases (venous hypertension).
Reflux, and the resulting venous hypertension, causes the leg to swell, resulting in debilitating pain, and in the most severe cases,
venous ulcers.
Severe
CVI sufferers experience a significantly reduced quality of life. Daily activities such as preparing meals, housework, and personal hygiene
(washing and bathing) become difficult due to reduced mobility. For many severe CVI sufferers, intense pain, which frequently occurs
at night, prevents patients from getting adequate sleep. Severe CVI sufferers are known to miss approximately 40% more workdays than
the average worker. A high percentage of venous ulcer patients also experience severe itching, leg swelling, and an odorous discharge.
Wound dressing changes, which occur several times a week, can be extremely painful. Venous ulcers from deep venous CVI are very difficult
to heal, and a significant percentage of venous ulcers remain unhealed for more than a year. Even if healed, recurrence rates for venous
ulcers are known to be high (20% to 40%) within the first year and as high as 60% after five years. Patients with severe CVI often become
housebound and experience social isolation due to difficulty with ambulation. As a result, studies have shown that patients with active
venous ulcers experience higher rates of anxiety and depression, with reported rates of anxiety of up to 30% and depression up to 40%.
Rates of depression caused by venous ulcers among the elderly are even higher, with 48% of elderly venous ulcer patients having severe
depressive symptoms.
Prevalence
is generally defined as the portion of the population that has a given condition. Estimates indicate that the prevalence of people in
the U.S. with severe, deep venous CVI (C4 to C6 disease) with reflux to be approximately 20 million. Incidence is generally defined as
the number of new cases of an ailment that develop in a given time period. We estimate that approximately 3.5 million new patients with
severe deep venous CVI are diagnosed each year in the U.S. including patients that develop venous leg ulcers (C6 patients). The average
patient seeking treatment of a venous ulcer spends as much as $30,000 a year on wound care, and the total direct medical costs from venous
ulcer sufferers in the U.S. has been estimated to exceed $3 billion a year.
VenoValve
The
VenoValve is a porcine based replacement venous valve developed at enVVeno Medical to be surgically implanted in the deep venous system
of the leg to treat severe CVI. By reducing reflux and lowering pressure (venous hypertension) within the deep venous system of the leg,
the VenoValve has the potential to reduce or eliminate the symptoms of severe deep venous CVI, including the potential to heal recurring
venous leg ulcers. The VenoValve is implanted into the femoral vein of the patient in an open surgical procedure via a 5-to-6-inch incision
in the upper thigh. As our planned initial entrant to the replacement venous valve market, we estimate that approximately 2.5 million
people with severe deep venous CVI in the U.S. would be candidates for the VenoValve.
VenoValve
Clinical Status
After
consultation with the FDA, and as a precursor to the U.S. pivotal trial, in 2020 we conducted a small first-in-human study for the VenoValve
in Colombia which included eleven (11) patients. In addition to providing safety and efficacy data, the purpose of the first-in-human
study was to provide proof of concept, and to provide feedback to make any necessary product modifications or adjustments to our surgical
implantation procedure for the VenoValve prior to conducting the SAVVE (Surgical Anti-reflux Venous Valve Endoprosthesis) U.S. pivotal
trial. Endpoints for the VenoValve first-in-human study included safety (device related adverse events), reflux, measured by Duplex Ultrasound,
a rVCSS score used by the clinician to measure disease severity and progress, a VAS score used by the patient to measure pain, and quality
of life measurements.
Results
from the one year first-in-human study were presented at the Charing Cross International Symposium in April of 2021. Among the eleven
(11) patients in the study, reflux improved an average of 54%, Venous Clinical Severity Scores (“VCSSs”) improved an average
of 56%, and visual analog scale (VAS) scores, which are used by patients to measure pain, improved an average of 76%, all at one (1)
year when compared to pre-surgery levels. VCSS scores are commonly used by clinicians in practice and in clinical trials to objectively
assess outcomes in the treatment of venous disease, and include ten characteristics including pain, inflammation, skin changes such as
pigmentation and induration, the number of active ulcers, and ulcer duration. The improvement in VCSS scores is significant and indicates
the VenoValve patients who had severe CVI pre-surgery, had mild CVI or the complete absence of disease at one-year post surgery.
Related
safety incidences during the one year first-in-human study for the VenoValve included one (1) fluid pocket (which was aspirated), intolerance
from Coumadin anticoagulation therapy, three (3) minor wound infections (treated with antibiotics), and one occlusion due to patient
non-compliance with anti-coagulation therapy.
On
August 3, 2020, we announced that the FDA granted Breakthrough Device Designation status to the VenoValve. The FDA’s Breakthrough
Devices Program was established to enable priority review for devices that provide more effective treatment or diagnosis of life threatening
or irreversibly debilitating diseases or conditions. The goal of the FDA’s Breakthrough Devices Program is to provide patients
and health care providers with timely access to medical devices by speeding up their development, assessment, and review, while preserving
the FDA’s mission to protect and promote public health.
In
March 2021, we submitted an IDE application with the FDA and in April 2021, we received notification from the FDA that our IDE application
was approved. An investigational device exemption or IDE from the FDA is required before a medical device company can proceed with a
pivotal trial for a class III medical device. This approval allowed us to proceed with our SAVVE study, a prospective, non-blinded, single
arm, multi-center study of seventy-five (75) CVI patients to be enrolled at up to 20 U.S. sites. We later received permission from the
FDA to increase the number of clinical sites to up to 30.
At
the end of the VenoValve first-in-human study, eight (8) study participants agreed to additional monitoring. In November of 2022, three-year
follow-up data was presented at the 49th Annual VEITH Symposium in New York city for this cohort of patients. That data indicated no
recurrences of the severe CVI that was present pre-VenoValve, including no ulcer recurrences for those patients who had venous ulcers
(C6 patients) prior to receiving the VenoValve. There were no reported safety issues from the end of one (1) year first-in-human study
to the end of the three (3) year reporting period. In addition, the patients continued to show improvements compared to pre-surgery levels,
reporting 62%, 64%, and 84%, average improvements in reflux, VCSS, and VAS scores, respectively, at an average of three (3) years post
VenoValve surgery. One deep vein thrombosis (DVT) occurred between year 2 and year 3 due to patient non-compliance with anti-coagulation medication. In addition
to presenting at leading academic and vascular conferences around the world, results from the VenoValve first-in-human study and following
observational period have been published in the Journal of Vascular Surgery Venous and Lymphatic Disorders, the Journal of
Vascular and Endovascular Surgery, and JAMA Surgery Journal.
In
November of 2022, we announced we had passed a preliminary safety review by the FDA for the first twenty (20) patients enrolled in the
SAVVE trial. The FDA had requested that we submit preliminary safety data at thirty (30) days post VenoValve implantation for the first
twenty (20) patients enrolled in the study. The preliminary safety data included one (1) device related (mild) and two (2) procedure
related (moderate) adverse events. After review by the FDA, the study was cleared to continue without modification or interruption.
As
widely reported in the media, the lasting impact from the COVID-19 pandemic has put an enormous strain on hospital resources including
their clinical staff. Hospitals continue to be severely understaffed, which impacts the rate at which clinical trials enroll and progress.
We have taken several steps to help address the hospital staffing shortages, including our hiring of 4 Clinical Technologists, with extensive
and specialized experience in duplex sonography of the deep venous system, to assist in training site personnel, proctoring Duplex Ultrasound
examinations, and providing assistance for the SAVVE study.
enVVe
On
September 21, 2022, we announced the development of a non-surgical transcatheter based replacement venous valve called enVVe™,
for the treatment of CVI of the deep veins of the leg. Preliminary bench testing and animal testing for enVVe were completed before our
announcement. We also filed an application seeking approval to begin a first-in-human (FIH) trial in Columbia. The trial will be known
as the Transcatheter Anti-reflux, Venous Valve Endoprosthesis first-in-human (TAVVE-FIH) study. The initial phase of the TAVVE-FIH study
will seek to enroll 3 to 5 patients across multiple sites.
Several
parameters will be evaluated over the course of the study including safety and technical success of the enVVe venous valve delivery system,
and the safety and clinical performance of the enVVe venous valve. enVVe is delivered into the femoral vein of the patient via a minimally
invasive procedure requiring no general anesthesia and no overnight hospital stay. Due to the minimally invasive nature of the procedure,
we expect to be able to reach patients with less severe CVI or who are otherwise not good candidates for a surgical device, and estimate
the U.S. market for enVVe to be approximately 3.5 million patients.
Capital
We
finished 2022 with approximately $39.1 million of cash and investments and had approximately $34.2 million of cash and investments
at March 31, 2023. At our existing cash burn rate of approximately $4 - 5 million per quarter, we should have sufficient cash to
fund operations through the end of 2024 and into 2025. With primary endpoints following full enrollment in the SAVVE pivotal trial
of thirty (30) days for safety, and six (6) months for effectiveness, we expect to have primary endpoint data well in advance of the
need to raise additional capital.
Intellectual
Property
We
possess an extensive proprietary processing and manufacturing methodology specifically applicable to the design, processing, manufacturing
and sterilization of biologic devices. This includes FDA compliant quality control and assurance programs, proprietary tissue processing
technologies demonstrated to eliminate recipient immune responses, trusted relationship with abattoir suppliers, and a combination of
tissue preservation and gamma irradiation that enhances device functions and guarantees sterility. We have filed numerous patent applications
for the VenoValve with the U.S. Patent and Trademark Office (USPTO) and throughout the world. We currently have nineteen (19) patents
granted from agencies around the world including five (5) from the USPTO.
Results
of Operations
Comparison
of the three months ended March 31, 2023 and 2022
Overview
We
reported net losses of $6.4 million and $5.3 million for the three months ended March 31, 2023 and 2022, respectively, representing an
increase in net loss of $1.1 million, or 21%, resulting from an increase in operating expenses.
Revenues
As
a developmental stage Company, our revenue, if any, is expected to be diminutive and dependent on our ability to commercialize our product
candidates. We are not currently generating revenue and do not expect significant revenue until we successfully commercialize our lead
product candidate.
Selling,
General and Administrative Expenses
For
the three months ended March 31, 2023, selling, general and administrative expenses decreased by $0.6 million or 16%, to $3.2 million
from $3.8 million for the three months ended March 31, 2022. Of this decrease, $0.4 million was due to share based compensation, which
decreased to $1.8 million in 2023 from $2.2 million in 2022, primarily because of the timing of vesting of grants made in 2021. The remaining
$0.2 million decrease reflects $0.1 million from lower Delaware franchise taxes in 2023, and $0.1 million from lower outside services
cost related to investor relations and our website update.
Research
and Development Expenses
For
the three months ended March 31, 2023, research and development expenses increased by $2.0 million or 125%, to $3.6 million from
$1.6 million for the three months ended March 31, 2022. This increase primarily resulted from $1.6 million in costs related the
SAVVE study, $0.3 million increase in lab and personnel costs to support the VenoValve pivotal trial and enVVe development, and $0.1
million in travel costs, also related to the SAVVE study.
Other Income
For
the three months ended March 31, 2023, other income was $0.4 million compared to nil in 2022. Other income in 2023 reflects interest,
realized gains and unrealized gains from our program to invest excess cash in US Treasury bills, which we had not yet commenced during
the three months ended March, 31, 2022.
Liquidity
and Capital Resources
For
the three-months ended March 31, 2023, the Company incurred losses from operations of $6.8 million and used $5.1 million cash in operating
activities. The net cash used in operating activities during the 2023 period increased by $1.8 million from $3.3 million for the quarter
ended March 31, 2022.
The
losses and the uses of cash are primarily due to the Company’s administrative and product research and development activities.
Administrative functions relate to costs to support the Company’s public reporting and investor relations activities as well
as internal administrative functions. Research and development activities are for continued product development and clinical trials
for our product candidates, currently the VenoValve and enVVe. The Company will continue to incur these costs to complete its
clinical trials, enhance products, develop new products, and operate as a public company. Although we have discretion in how we use
the Company’s cash resources, we expect to continue these activities for the foreseeable future as we seek to obtain
regulatory approval for our product candidates. We are not currently generating revenue and do not expect significant revenue until
we successfully commercialize one or more of our product candidates.
Our
cash flows from investing activity consist of maturities and purchases of US Treasury bills from our program to invest excess cash,
and purchases of property and equipment for our lab and offices. During the quarter ended March 31, 2023 we purchased $8.6 million of treasury bills and $11.5 million of them matured generating $0.1
million in realized gains and interest income. We expect to continue investing as the treasury bills mature and as allowed by the cash
requirements of our operations. In the quarter ended March 31, 2023,
our purchases of property and equipment consisting primarily of lab and test equipment, were less than $0.1 million.
We do not
currently have material commitments for capital expenditures or other expenditures except for our facility lease
commitment of $0.4 million per year. However, we expect a modest increase in purchases of property and equipment as we continue
SAVVE, plan for commercialization of the VenoValve and continue development of enVVe.
The
Company has historically funded its operations through financing activities such as the capital raises completed in 2021. Our cash and
investments balances as of March 31, 2023, were $2.3 million and $31.9 million, respectively. Our future capital requirements will remain
dependent upon a variety of factors, especially including the success of our clinical trials and related product development costs and
our ability to successfully bring products to market. At our existing cash burn rate of approximately $4 - 5 million per quarter, we
should have sufficient cash to fund operations through the end of 2024 and into 2025. With primary endpoints following full enrollment
in the SAVVE pivotal trial of thirty (30) days for safety, and six (6) months for effectiveness, we expect to have primary endpoint data
well in advance of the need to raise additional capital. Any inability to raise additional financing would have a material adverse effect
on us.
Based
upon our cash and working capital as of March 31, 2023, we have sufficient capital resources to meet our obligations as they become due
for at least one year after the date of this Report and sustain operations.
As
of April 26, 2023, we had a cash and investment balances of $2.8 million and $31.0 million, respectively.
The lasting impact from the COVID-19 pandemic has put an enormous strain on hospital resources including
their clinical staff. Hospitals continue to be severely understaffed, which impacts the rate at which clinical trials enroll and progress.
We have taken several steps to help address the hospital staffing shortages, including our hiring of 4 Clinical Technologists, with extensive
and specialized experience in duplex sonography of the deep venous system, to assist in training site personnel, proctoring Duplex Ultrasound
examinations, and providing assistance for the SAVVE study.
Off-Balance
Sheet Arrangements
None.
Contractual
Obligations
As
a smaller reporting company, we are not required to provide the information requested by paragraph (a)(5) of this Item.
Critical
Accounting Policies and Estimates
For
a description of our critical accounting policies, see Note 3 – Significant Accounting Policies in Part 1, Item 1 of this Quarterly
Report on Form 10-Q.
