Modular Medical, Inc.

Previous wording

We are a pre-revenue medical device company focused on the design, development and commercialization of innovative insulin pumps using modernized technology to increase pump adoption in the diabetes marketplace. Through the creation of a novel two-part patch pump, our initial product, the MODD1, we seek to fundamentally alter the trade-offs between cost and complexity and access to the higher standards of care that presently-available insulin pumps provide. By simplifying and streamlining the user experience from introduction, prescription, reimbursement, training and day-to-day use, we seek to expand the wearable insulin delivery device market beyond the highly motivated “super users” and expand the category into the mass market. The product seeks to serve both the type 1 and the rapidly growing, especially in terms of device adoption, type 2 diabetes markets. In January 2024, we submitted a 510(k) premarket notification to the United States Food and Drug Administration (the “FDA”) for our MODD1 insulin pump, and, in September 2024, we received FDA clearance to market and sell our MODD1 pump in the United States. We are actively working to commercialize our MODD1 product and commence initial shipments in the first half of fiscal 2026, obtain regulatory clearance to market and sell our MODD1 product in foreign jurisdictions, improve the manufacturability and usability of our MODD1 product and develop new pump products.

Current wording

We are a pre-revenue medical device company focused on the design, development and commercialization of innovative insulin pumps using modernized technology to increase pump adoption in the diabetes marketplace. Through the creation of a novel two-part patch pump, our initial product, the MODD1, we seek to fundamentally alter the trade-offs between cost and complexity and access to the higher standards of care that presently-available insulin pumps provide. By simplifying and streamlining the user experience from introduction, prescription, reimbursement, training and day-to-day use, we seek to expand the wearable insulin delivery device market beyond the highly motivated “super users” and expand the category into the mass market. The product seeks to serve both the type 1 and the rapidly growing, especially in terms of device adoption, type 2 diabetes markets. In January 2024, we submitted a 510(k) premarket notification to the United States Food and Drug Administration (the “FDA”) for our MODD1 insulin pump, and, in September 2024, we received FDA clearance to market and sell our MODD1 pump in the United States. We are actively working to i) commercialize our MODD1 product and commence initial shipments by October 2025, ii) obtain regulatory clearance to market and sell our Pivot product during the first half of 2026, iii) obtain regulatory clearance to market and sell our pump products in foreign jurisdictions, iv) improve the manufacturability and usability of our pump products and v) develop new pump products. We believe the Pivot product will provide us with cost and usability improvements and improved manufacturability, allowing our marketing to be focused on low cost and ease of use and learnability. We intend to replace the MODD1 product with the Pivot product, as soon as the required regulatory approval from the FDA is received.

Previous wording

Historically, we have financed our operations principally through private placements and public offerings of our common stock and sales of convertible promissory notes. Based on our current operating plan, substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued exists. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities, to support our future operations. If we are unable to secure additional capital, we will be required to curtail our research and development initiatives and take additional measures to reduce costs. We have provided additional disclosure in Note 1 to the consolidated financial statements in Item 1 of this Report and under Liquidity below.

Current wording

Historically, we have financed our operations principally through private placements and public offerings of our common stock and warrants and sales of convertible promissory notes. Based on our current operating plan, substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued exists. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities, to support our future operations. If we are unable to secure additional capital, we will be required to curtail our research and development initiatives and take additional measures to reduce costs. We have provided additional disclosure in Note 1 to the consolidated financial statements in Item 1 of this Report and underLiquiditybelow.

Previous wording

Our research and development, or R&D, expenses include personnel, consulting, testing, materials and supplies, depreciation and amortization and other operational costs associated with the pre-commercialization development and production of our insulin pump products. We expense R&D costs as they are incurred.

Current wording

Our research and development, or R&D, expenses include personnel, consulting, testing, materials and supplies, depreciation and amortization and other non-capitalizable operational costs associated with the production of our insulin pump product. We expense R&D costs as they are incurred.

Previous wording

R&D expenses increased for the nine months ended December 31, 2024 compared with the same period of 2023, primarily due to increased employee-related costs of approximately $0.9 million, an increase in depreciation expense of approximately $0.5 million, an increase in travel-related and other costs of approximately $0.2 million and an increase in stock-based compensation costs of approximately $0.1 million. These increases were partially offset by decreases of approximately $0.6 million in consulting expenses and $0.1 million in material and supplies costs.

Current wording

R&D expenses increased for fiscal 2026 compared with the same period of fiscal 2025, primarily due to increased personnel costs of approximately $0.9 million, an increase in material costs of approximately $0.3 million, an increase in stock-based compensation expense of approximately $0.2 million, an increase of approximately $0.2 million in consulting costs, an increase in depreciation expense of approximately $0.2 million and an increase in shipping and related expenses of approximately $0.1 million.

Previous wording

Our full-time R&D employee headcount increased to 44 at December 31, 2024 from 36 at December 31, 2023. R&D expenses included stock-based compensation expenses of approximately $0.3 million and $0.7 million for the three-months ended December 31, 2024 and 2023, respectively, and $1.5 million and $1.4 million for the nine-month periods ended December 31, 2024 and 2023, respectively. We expect research and development expenses to increase for the remainder of fiscal 2025 due to testing activities in support of commercialization of our MODD1 product and to advance development of new pump products.

Current wording

Our full-time R&D employee headcount increased to 55 at June 30, 2025 from 36 at June 30, 2024. R&D expenses included stock-based compensation expenses of approximately $0.6 million and $0.4 million for the three-month periods ended June 30, 2025 and June 30, 2024, respectively. We expect research and development expenses to remain consistent in fiscal 2026.

Previous wording

General and administrative, or G&A, expenses consist primarily of personnel and related overhead costs for facilities, finance, human resources, legal, investor relations, marketing and general management.

Current wording

Selling, general and administrative, or SG&A, expenses consist primarily of personnel and related overhead costs for facilities, finance, human resources, legal, sales, marketing and general management.

Previous wording

We do not currently have revenues to generate cash flows to cover operating expenses. Since our inception, we have incurred operating losses and negative cash flows in each year due to costs incurred in connection with our operations. For the nine months ended December 31, 2024 and year ended March 31, 2024, we incurred net losses of approximately $13.9 million and $17.5 million, respectively. At December 31, 2024, we had a cash balance of $7.0 million and an accumulated deficit of approximately $80 million. We expect to continue to incur operating losses for the foreseeable future and incur cash outflows from operations, as we continue to invest in the development and commercialization of our pump products. We expect that our expenses will continue to increase, and, as a result, we will eventually need to generate significant revenue to achieve profitability. When considered with our current operating plan, these conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued. Our financial statements do not include adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our operating needs include the planned costs to operate our business, including amounts required to fund continued research and development activities, working capital and capital expenditures. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities to support our future operations.

Current wording

We do not currently have revenues to generate cash flows to cover operating expenses. Since our inception, we have incurred operating losses and negative cash flows in each year due to costs incurred in connection with R&D activities and SG&A expenses associated with our operations. For the three months ended June 30, 2025 and year ended March 31, 2025, we incurred net losses of approximately $6.7 million and $18.8 million, respectively. At June 30, 2025, we had a cash balance of $7.5 million and an accumulated deficit of approximately $91 million. When considered with our current operating plan, these conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued. Our financial statements do not include adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our operating needs include the planned costs to operate our business, including amounts required to fund continued research and development activities, working capital and capital expenditures. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities to support our future operations. In November 2023, we entered into a Sales Agreement (the “ATM Agreement”) with Leerink Partners LLC (“Leerink”) under which we may offer and sell, from time to time at our sole discretion, shares of our common stock, for aggregate gross proceeds of up to $6.5 million (subject to availability on our shelf registration statement) through an “at the market offering” program under which Leerink will act as sales agent or principal. During the three months ended June 30, 2025, we sold 1,000,000 shares of common stock under the at-the-market agreement for proceeds of approximately $0.7 million. In addition, in March 2025, the Company completed private placements of its common stock and warrants for net proceeds of approximately $11.4 million. Our future capital requirements and the adequacy of our available funds will depend on many factors, including, without limitation, our ability to successfully commercialize our product, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product offerings. If we are unable to secure additional capital timely, we may be required to curtail R&D initiatives, reduce headcount and take additional measures to reduce costs in order to conserve our cash.

Previous wording

For the nine months ended December 31, 2024, we used approximately $11.4 million of cash in operating activities, which primarily resulted from our net loss of approximately $13.9 million and net changes in operating assets and liabilities of approximately $0.3 million, as adjusted forstock-based compensation expenses of approximately $2.0 million, depreciation and amortization expenses of approximately $0.7 million and other immaterial adjustments. For the nine months ended December 31, 2023, we used approximately $10.5 million in operating activities, which primarily resulted from our net loss of approximately $13.2 million and net changes in operating assets and liabilities of approximately $0.4 million, as adjusted forstock-based compensation expenses of approximately $2.0 million anddepreciation and amortization expenses of approximately $0.3 million and other immaterial adjustments.

Current wording

For the three months ended June 30, 2025, we used approximately $5.4 million of cash in operating activities, which primarily resulted from our net loss of approximately $6.7 million, as adjusted for net changes in operating assets and liabilities of approximately $0.2 million, stock-based compensation expenses of approximately $0.7 million, depreciation and amortization expenses of approximately $0.4 million and other immaterial adjustments. For the three months ended June 30, 2024, we used approximately $3.5 million of cash in operating activities, which primarily resulted from our net loss of approximately $4.1 million and net changes in operating assets and liabilities of approximately $0.1 million, as adjusted forstock-based compensation expenses of approximately $0.5 million anddepreciation and amortization expenses of approximately $0.2 million and other immaterial adjustments.

Previous wording

For the nine months ended December 31, 2024 and 2023, cash used in investing activities of approximately $1.5 million and$1.2 million, respectively, was for the purchase of property and equipment.

Current wording

For the three months ended June 30, 2025 and 2024, cash used in investing activities of approximately $0.9 million and$0.8 million, respectively, was for the purchase of property and equipment.

Previous wording

Cash provided by financing activities of approximately $10.7 million for the nine months ended December 31, 2024 was attributable to $7.3 million of proceeds from the issuance of common stock in a public offering, net of underwriting fees and issuance costs, which closed in November 2024, $2.1 million of proceeds from sales of our common stock under an at-the-market offering and $1.3 million of proceeds from exercises of common stock purchase warrants. Cash provided by financing activities for the nine months ended December 31, 2023 was attributable to $9.7 million of net proceeds from the issuance of common stock and warrants in a public offering, which closed in May 2023, and approximately $0.2 million of proceeds from the exercise of common stock purchase warrants.

Current wording

Cash provided by financing activities of approximately $0.7 million for the three months ended June 30, 2025 was attributable to proceeds from sales of common stock under the ATM agreement. Cash provided by financing activities of $0.2 million for the three months ended June 30, 2024 was attributable to proceeds from the exercise of common stock purchase warrants.

Previous wording

Our primary purchase obligations include purchase orders for machinery and equipment. At December 31, 2024, we had outstanding purchase orders for machinery and equipment and related expenditures of approximately $1.1 million.

Current wording

Our primary purchase obligations include purchase orders for machinery and equipment. At June 30, 2025, we had outstanding purchase orders for machinery and equipment and related expenditures of approximately $2.4 million.