EBR Systems, Inc.
For the period ended Mar 31, 2025. Filed May 13, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 13, 2025
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-12.
0001214659-24-018763
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-13.
0001214659-25-007491
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 97 previous paragraphs and 89 current paragraphs.
47 unchanged; 18 reworded; 24 added; 29 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 39 previous and 45 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (24)
Current report
On April 11, 2025, we received notification that the Center for Devices and Radiological Health (“CDRH”) of the Food and Drug Administration (“FDA”) had completed its review of our premarket approval application (“PMA”) for the WiSE CRT System and approved the WiSE CRT System for commercial distribution in the U.S. for adult patients who are at least 22 years of age, are indicated for CRT, have an existing or are eligible for an implanted right ventricular pacing system, and are in one of the following two categories: patients in whom previous coronary sinus (“CS”) lead implantation was unsuccessful, or where an implanted lead has been turned off, referred to as "previously untreatable"; or patients with previously implanted pacemakers or Implantable Cardioverter-Defibrillators (“ICDs”) in whom standard CRT upgrade is not advisable due to known relative contraindications for CS lead or CRT device implantation, referred to as "high risk upgrades".
Current report
We intend to commercially launch WiSE with the focus on driving adoption of WiSE at key, high-volume, luminary sites within the U.S. to be followed by select, high-volume sites in markets outside the U.S. (“OUS”) that we would target after evaluating regulatory and reimbursement considerations.
Current report
We plan to implement a phased Limited Market Release (“LMR”), with the following phases:
Current report
LMR Phase 1: Initial Target Accounts
Current report
LMR Phase 2: Expansion and Optimization
Current report
LMR Phase 3: Increase Implants Per Site
Current report
Full Market Release
Current report
Our OUS commercial activities will not commence until we obtain regulatory approvals and certification in select, target markets. These initial target markets include Australia, the United Kingdom, and the European Union. The timing of launch in each of these OUS markets thus depends on meeting additional regulatory requirements, as well as on securing the appropriate payment coverage for WiSE in each market.
Current report
As a result of its breakthrough device designation (“BDD”), our WiSE CRT technology is expected to be eligible for incremental payment coverage in the U.S. for up to three years following FDA approval. The Centers for Medicare & Medicaid Services (“CMS”) has proposed approval of the New Technology Add-On Payment (“NTAP”) for our WiSE CRT System for fiscal year 2026, subject to final approval before October 1, 2025. CMS has recommended WiSE receive the maximum add on payment of 65% of the device cost, which is in additional to the normal Medicare Severity Diagnosis Related Group (“MS-DRG”) payment. In combination, if approved, these reimbursements are intended to fully cover the cost of the WiSE CRT System.
Current report
Our WiSE CRT System has been approved by the FDA for commercial distribution in April 2025, and we will begin commercializing WiSE during the second quarter of 2025. The commercial potential of and our ability to successfully commercialize WiSE is unproven and will require, among other things, effective sales, marketing, manufacturing, distribution, information systems and pricing strategies, as well as compliance with applicable laws and regulations. Based on our current operating plans and assumptions we believe that our existing cash, cash equivalents, and current and noncurrent marketable securities, together with projected revenue from U.S. sales of WiSE will be sufficient to fund our projected operating requirements into the first quarter of 2026.
Current report
Our critical accounting estimates are more fully described in our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no significant changes to our critical accounting estimates since December 31, 2024.
Current report
Non- GAAP Financial Measures
Current report
Adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”), a non-GAAP measure used by management to assess operating performance, is defined as net loss, excluding interest expense, net, depreciation and amortization, and stock-based compensation. Adjusted EBITDA is intended as a supplemental measure of our performance and provides useful information to management and investors regarding our operating results.
Current report
We present Adjusted EBITDA in this filing because we believe it assists investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our ongoing operating performance. Period-to-period comparison of Adjusted EBITDA helps our management identify additional trends in our company’s financial results that may not be shown solely by period-to-period comparison of net loss. In addition, we believe that providing Adjusted EBITDA, together with a reconciliation of Adjusted EBITDA to net loss, helps investors make comparisons between our company and other companies that may have different capital structures, different capitalized asset values, different forms of employee compensation and different strategic nonrecurring projects. Adjusted EBITDA has its limitations as an analytical tool because of the excluded items, and you should not consider it in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. Some of these limitations include:
Current report
A reconciliation between net loss and adjusted EBITDA is presented below:
Current report
Going concern consideration
Current report
The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. For the three months ended March 31, 2025 and 2024, we incurred a net loss of $10,554,271 and $9,150,003, respectively. During the three months ended March 31, 2025 and 2024, we had negative cash flows from operations of $13,563,695 and $10,059,772, respectively. As of March 31, 2025, we had working capital of $46,751,043 and accumulated deficit of $364,011,951. These factors raise substantial doubt about our ability to continue as a going concern. Until we are able to generate consistent and sufficient revenue from sales of our WiSE CRT System, our ability to continue as a going concern is dependent on our ability to raise additional capital through the issuance of additional common stock or borrowings from financial institutions. Our ability to obtain additional capital in the equity capital markets is subject to several factors, including market and economic conditions, our performance, and investor sentiment with respect to our company and our industry.
Current report
Future Funding Requirements
Current report
Despite recent FDA approval of WiSE CRT System, the outcome of any clinical activities and/or regulatory approval process is highly uncertain, we cannot reasonably estimate whether our future development activities may succeed; or whether we will be able to effectively commercialize WiSE CRT System in the U.S., if at all. We may never recoup our investment in any WiSE CRT System development which would adversely affect our financial condition and our business and business prospects. In addition, our plans and timing expectations could be further delayed or interrupted by the effects of macroeconomic or other global conditions, including those resulting from inflation, rising interest rates, prospects of a recession, bank failures and other disruptions to financial systems, civil or political unrest, military conflicts, pandemics or other health crises and supply chain and resource issues.
Current report
To date, we have not generated any commercial product revenue. We will continue to require additional capital to successfully commercialize WiSE CRT System and fund operations for the foreseeable future. Our primary uses of cash are to fund our operations, which consist primarily of research and development expenses, manufacturing automation and scaleup, and general and administrative expenses. We expect our expenses to continue to increase in connection with our ongoing activities as we continue to commercialize WiSE CRT System.
Current report
We may seek to raise capital through equity offerings or debt financings, collaboration agreements, or other arrangements with other companies, or through other sources of financing. Adequate additional funding may not be available to us on acceptable terms or at all. Our failure to raise capital as and when needed could have a negative impact on our consolidated financial condition and our ability to pursue our business strategies. We anticipate that we will need to raise substantial additional capital, the requirements of which will depend on many factors, including:
Current report
If we raise additional capital through debt financing, we may be subject to covenants that restrict our operations including limitations on our ability to incur liens or additional debt, pay dividends, make certain investments, and engage in certain merger, consolidation, or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us. If we raise funds through collaborations, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds when needed, we may be required to delay, reduce, or terminate some or all of our development programs and clinical trials or delay investments in our manufacturing scale-up and automation. In addition, our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to and volatility in the credit and financial markets. Furthermore, this Quarterly Report on Form 10-Q contains statements expressing substantial doubt about our ability to continue as a going concern. If we seek additional financing to fund our business activities in the future and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be unwilling to provide funding to us on commercially reasonable terms, if at all.
Current report
As of March 31, 2025, we had $1.0 million in operating lease obligations for our corporate headquarters and laboratory space located in Sunnyvale, California. Additionally, in January 2025, we entered into a new lease agreement for our new corporate headquarters, laboratory and manufacturing facility in Santa Clara, California, for which we had recorded $13.3 million in operating lease obligations as of March 31, 2025.
Current report
Net cash provided by financing activities during both three months ended March 31, 2025 and 2024, was $0.2 million. The cash provided by financing activities during the three months ended March 31, 2025, was primarily attributable to the proceeds from exercise of stock options. Cash provided by financing activities during the three months ended March 31, 2024, was comprised from $0.1 million in proceeds from exercise of stock options and $0.1 million in proceeds from note payable related to the software purchase agreement.
Removed paragraphs (29)
Previous report
We completed interim enrollment in the pivotal SOLVE-CRT (Stimulation of the Left Ventricular Endocardium for Cardiac Resynchronization Therapy) study in July 2022, and subsequently stopped enrollment as a result of early trial success. The results, presented during a Late Breaking Clinical Trial session at the 2023 Heart Rhythm Society Conference, showed the study met both its primary efficacy and safety end points. We have submitted all required modules of our modular pre-market approval (“PMA”) to the Food and Drug Administration (“FDA”) and will plan to begin commercialization upon final FDA approval. We plan to commercialize the device in Australia and certain European countries following our U.S. launch and upon obtaining local regulatory approvals and securing reimbursement coverage.
Previous report
On September 25, 2024, we issued 55,856,325 CDIs in connection with an institutional placement and the institutional component of a 1-for-20 pro-rata accelerated non-renounceable entitlement offer on the ASX. We raised approximately $29.5 million, net of issuance costs of approximately $1.8 million. On October 16, 2024, we issued 5,075,733 CDIs in connection with the retail component of a fully underwritten 1-for-20 pro-rata non-renounceable entitlement offer. We raised approximately $2.6 million, net of issuance costs of approximately $0.1 million.
Previous report
Our management’s discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States. The preparation of unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience, known trends and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities and recorded amounts of expenses that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
Previous report
While our significant accounting policies are described in more detail in Note 2 to our unaudited condensed consolidated financial statements appearing elsewhere in this Form 10-Q, we believe the following accounting policies used in the preparation of our unaudited condensed consolidated financial statements require the most significant judgments and estimates. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our audited consolidated financial condition and results of operations.
Previous report
Clinical trial accrual
Previous report
The clinical trial accrual involves identifying services that third parties, contracted by us, have performed and estimating the associated cost incurred for these services which remain uninvoiced as of the balance sheet date. In addition, the clinical trial accrual involves the measurement of milestone achievements achieved by the patients participating in the clinical trial and the associated costs which have not been invoiced as of the balance sheet date. Our objective is to reflect the appropriate clinical trial expenses in our unaudited condensed consolidated financial statements by matching the appropriate expenses with the period in which services are provided. We account for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. Our clinical trial accrual is dependent, in part, upon the receipt of timely and accurate reporting from the third parties. We estimate our liability using our judgment based upon the facts and circumstances known at the time. During the course of a clinical trial, we adjust our clinical expense recognition if actual results differ from our estimates.
Previous report
Stock-Based compensation
Previous report
We measure all stock options and other stock-based awards based on their fair value on the date of the grant. Those awards typically have a graded vesting schedule and compensation expense for awards with only service conditions are recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the respective award. Forfeitures are accounted for as they occur.
Previous report
We use the Black-Scholes option pricing model, which incorporates assumptions and estimates, to measure the fair value of its option awards on the date of grant of each stock option award.
Previous report
We determined the assumptions for the Black-Scholes option-pricing model as discussed below. Each of these inputs is subjective and generally requires significant judgment to determine.
Previous report
If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation for future awards may differ materially compared with the awards granted previously.
Previous report
Income Taxes
Previous report
We are subject to income taxes in the United States and multiple foreign jurisdictions. Our effective tax rates differ from the United States federal statutory rate, primarily due to changes in our valuation allowance, stock-based compensation expense, state and foreign tax benefit, federal research and development tax credits and other adjustments. Our effective tax rate was 0.00% and 0.00% for both the three-month and nine-month periods ended September 30, 2024 and 2023. The calculation of our provision for income taxes involves the use of estimates, assumptions and judgments while taking into account current tax laws, our interpretation of current tax laws and possible outcomes of future tax audits. We review our tax positions quarterly and adjust the balances as new information becomes available.
Previous report
Significant management judgement is required in assessing our ability to realize any future benefit from our net deferred tax assets. Due to our history of net losses, the difficulty in predicting future results, the length of statutory carryforward periods, and tax planning alternatives, we believe that we cannot rely on projections of future taxable income to realize most of our deferred tax assets. Accordingly, we have established a full valuation allowance against our United States federal and states net deferred tax assets. We intend to maintain this valuation allowance until sufficient positive evidence exists to support its reversal. Our income tax expense recorded in the future will be reduced to the extent that sufficient positive evidence materializes to support a reversal, or decrease in, our valuation allowance.
Previous report
We recognize tax benefits from uncertain tax positions only if it is more likely than not (more than 50%) that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. We file annual income tax returns in multiple taxing jurisdictions around the world and a number of years may elapse before an uncertain tax position is audited by the relevant tax authorities and finally resolved. We have established reserves to address potential exposures related to tax positions that could be challenged by tax authorities. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position and we can provide no assurance that the final tax outcome of these matters will not be materially different, we believe that we have adequately reserved for our uncertain tax positions.
Previous report
Our future effective tax rates could be adversely affected if actual earnings are different than our estimates, by changes in the valuation of our deferred tax assets or liabilities, outcomes resulting from income tax examinations, or by changes or interpretations in tax laws, regulations or accounting principles.
Previous report
Comparison of the Nine Months Ended September 30, 2024, to the Nine Months Ended September 30, 2023
Previous report
We recorded a net loss of $30.7 million in the nine-month period ended September 30, 2024, an increase of $6.0 million, or 24.2%, from the nine-month period ended September 30, 2023. The increased loss in 2024 was due to an increase in research and development and general and administrative expenses in 2024, as discussed below. Other (expense) income, net also increased in 2024 due to an increase in interest expense and decrease in other income, which were offset partially by an increase in interest income, as discussed below.
Previous report
Operating Expenses
Previous report
Research and Development
Previous report
Research and development expenses increased by $0.9 million, or 4.9%, during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023. The increase was primarily due to a $2.1 million increase in personnel-related expenses, including salaries, bonuses, and certain fringe benefits resulting from an expansion in our workforce to support research, design, testing and development of our WiSE CRT System. This increase was offset by a $1.1 million decrease in clinical trial expenses, primarily due to a decrease in clinical trial activities related to SOLVE-CRT Study.
Previous report
General and Administrative Expenses
Previous report
Other (expense) income, net
Previous report
Other (expense) income, net increased by $1.9 million during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023. Interest expense increased by $1.6 million, which resulted from borrowing tranche 2 in June 2023, under a loan and security agreement, as discussed below. Additionally, other income has decreased by $0.4 million, primarily resulting from a decrease in refundable tax incentives. These changes were offset by a $0.1 million increase in interest income, including the accretion of discounts on marketable securities.
Previous report
To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and cash and other requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our stockholders. The incurrence of additional debt financing would result in debt service obligations and the instruments governing such debt could provide for operating and financing covenants that would restrict our operations. In the event that additional financing is required from outside sources, there is a possibility we may not be able to raise it on terms acceptable to us or at all. Further, the current macroeconomic environment may make it difficult for us to raise capital on terms favorable to us or at all. If we are unable to raise additional capital when desired, our business, operating results, and financial condition could be adversely affected.
Previous report
Recent Financings
Previous report
On September 25, 2024, we issued 55,856,325 CDIs in connection with an institutional placement and the institutional component of a 1-for-20 pro-rata accelerated non-renounceable entitlement offer on the ASX. We raised approximately $29.5 million, net of issuance costs of approximately $1.8 million. On October 16, 2024, we issued 5,075,733 CDIs in connection with the retail component of a fully underwritten 1-for-20 pro-rata non-renounceable entitlement offer. We raised approximately $2.6 million, net of issuance costs of approximately $0.1 million.
Previous report
Other than as described above, there have been no material changes to our contractual obligations and other commitments compared to those disclosed in our Form 10.
Previous report
Net cash provided by financing activities during the nine months ended September 30, 2024, was $29.8 million, compared to $40.5 million during the nine months ended September 30, 2023, representing a decrease of $10.7 million. This decrease is primarily attributed to the $19.7 million borrowing, net of issuance cost, under tranche 2 of the loan and security during the nine months ended September 30, 2023. This decrease was partially offset by $8.9 million increase in proceeds from a capital raise, net of issuance cost, during the nine months ended September 30, 2024, as well as by a $0.1 million increase in proceeds from exercise of stock options.
Reworded paragraphs (18)
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and other information included elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2023 included in our registration statement on Form 10-12G, as amended, filed with the Securities and Exchange Commission July 30, 2024, as amended by Amendment No. 1 filed on September 18, 2024 and Amendment No. 2 filed on October 23, 2024, and effective as of September 30, 2024 (“Form 10”). In addition to historical data, this discussion contains forward-looking statements about our business, results of operations, cash flows, financial condition and prospects based on current expectations that involve risks, uncertainties, assumptions, and other important factors. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in Part II, Item 1A. Risk Factors of the Form 10 and the section titled "Forward-Looking Statements" included therein. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future. We use words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "predict," "project," "potential," "seek," "should," "will," "would," and similar expressions to identify forward-looking statements.”
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and other information included elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2024. In addition to historical data, this discussion contains forward-looking statements about our business, ability to continue as a going concern, ability to successfully commercialize our WiSE CRT System, results of operations, cash flows, financial condition and prospects based on current expectations that involve risks, uncertainties, assumptions, and other important factors. Our actual results could differ materially from such forward-looking statements. Factors that could cause or contribute to those differences include, but are not limited to, those identified below and those discussed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K. Additionally, our historical results are not necessarily indicative of the results that may be expected for any period in the future. We use words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "predict," "project," "potential," "seek," "should," "will," "would," and similar expressions to identify forward-looking statements.
Previous wording
EBR is a U.S. based medical device company that is developing the WiSE CRT System, an implantable cardiac pacing system able to provide stimulation to endocardial heart tissue for the correction of heart rhythm conditions without requiring the use of leads. That implantable investigational device is part of a cardiac resynchronization therapy (“CRT”), potentially offering endocardial heart tissue stimulation without the complications associated with traditional lead-based systems. Cardiac rhythm management (“CRM”) systems use leads to conduct electricity from an implantable pulse generator (“IPG”) to electrodes that deliver therapeutic electric pulses to heart tissue. While leads are a critical part of most CRM systems, they have long been recognized as a primary shortcoming of these systems and are a leading cause of device failure.
Current wording
EBR is a U.S. based medical device company that developed the WiSE CRT System (“WiSE’), an implantable cardiac pacing system able to provide stimulation to endocardial heart tissue for the correction of heart rhythm conditions without requiring the use of leads. That implantable device is part of a cardiac resynchronization therapy (“CRT”), offering endocardial heart tissue stimulation without the complications associated with traditional lead-based systems. Cardiac rhythm management (“CRM”) systems use leads to conduct electricity from an implantable pulse generator (“IPG”) to electrodes that deliver therapeutic electric pulses to heart tissue. While leads are a critical part of most CRM systems, they have long been recognized as a primary shortcoming of these systems and are a leading cause of device failure.
Previous wording
Since inception, we have incurred significant net losses and expect to continue to incur net losses for the foreseeable future. Since our inception, our operations have been financed primarily by net proceeds from the sale of our CDIs, common stock, convertible preferred stock, and indebtedness. As of December 31, 2023, we had $73.4 million in cash, cash equivalents, and marketable securities and an accumulated deficit of $312.7 million. As of September 30, 2024, we had $74.2 million in cash, cash equivalents, and marketable securities and an accumulated deficit of $343.4 million.
Current wording
Since inception, we have incurred significant net losses and expect to continue to incur net losses for the foreseeable future. Since our inception, our operations have been financed primarily by net proceeds from the sale of our CDIs, common stock, convertible preferred stock, and indebtedness. As of March 31, 2025, we had $50.2 million in cash, cash equivalents, and marketable securities and an accumulated deficit of $364.0 million.
Previous wording
Research and development expenses primarily consist of personnel-related expenses, including salaries, bonuses, fringe benefits and other compensation-related costs, including stock-based compensation expense, for employees engaged in research and development functions. Research and development expenses also include costs of conducting our ongoing clinical studies, such as expenses associated with our clinical research organization, or CRO, who provides project management and other services related to our SOLVE-CRT study, outside service fees paid to third party consultants and contractors related to our product candidate engineering, quality assurance and regulatory approval, as well as contract manufacturing of our product candidate and allocated facility costs.
Current wording
Research and development expenses primarily consist of personnel-related expenses, including salaries, bonuses, fringe benefits and other compensation-related costs, including stock-based compensation expense, for employees engaged in research and development functions. Research and development expenses also include costs of conducting our ongoing clinical studies, such as expenses associated with our clinical research organization, or CRO, who provided project management and other services related to our SOLVE-CRT study, outside service fees paid to third party consultants and contractors related to our product candidate engineering, quality assurance and regulatory approval, as well as contract manufacturing of our product candidate and allocated facility costs.
Previous wording
The successful development of product candidates is subject to numerous risks and uncertainties. For a discussion of certain risks related to the development of product candidates and costs of clinical trials, see “Item 1A. Risk Factors” in the Form 10.
Current wording
The successful development of product candidates is subject to numerous risks and uncertainties. For a discussion of certain risks related to the development of product candidates and costs of clinical trials, see “Item 1A. Risk Factors” in our Form 10-K.
Previous wording
We anticipate that our research and development expenses will increase significantly in the future as we:
Current wording
We anticipate that our research and development expenses will increase in the future as we:
Previous wording
See the sections titled “Summary of Significant Accounting Policies—Recently issued accounting pronouncements” in Note 2 to our audited consolidated financial statements and our unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q.
Current wording
See the sections titled “Summary of Significant Accounting Policies—Recently issued accounting pronouncements” in Note 3 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Previous wording
We recorded a net loss of $10.1 million in the three-month period ended September 30, 2024, an increase of $0.9 million, or 10.1%, from the three-month period ended September 30, 2023. The increased loss in 2024 was due to an increase in general and administrative expenses in 2024, which was offset partially by a decrease in research and development, as discussed below. Other (expense) income, net also increased in 2024 due to a decrease in interest income and increase in loss on foreign currency transactions, as discussed below.
Current wording
We recorded a net loss of $10.6 million in the three-month period ended March 31, 2025, an increase of $1.4 million, or 15.4%, from the three-month period ended March 31, 2024. The increased loss in 2025 was due to an increase in general and administrative expenses, which was partially offset by a decrease in research and development expenses, as discussed below. Other (expense), net also increased in 2025, primarily due to a decrease in interest income, as discussed below.
Previous wording
Research and development expenses decreased by $0.7 million, or 9.5%, during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023. The decrease was primarily due to a $1.0 million decrease in contract manufacturing, materials and components, resulting from a decrease in professional services related to the development testing of WiSE CRT System, as well as capitalization of certain inventory purchases. Clinical trial expenses decreased by $0.4 million due to a decrease in clinical trial activities related to SOLVE-CRT Study. These decreases were offset by $0.8 million increase in personnel-related expenses, including salaries, bonuses, and certain fringe benefits, resulting from an expansion in our workforce to support the final development testing of the last module of our PMA submission for the WiSE CRT System.
Current wording
Research and development expenses decreased by $1.0 million, or 15.3% during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. The decrease was primarily due to a $1.0 million decrease in contract manufacturing, materials and components, resulting from a decrease in professional services related to the development testing of WiSE CRT System, as well as capitalization of pre-launch inventory. Facility-related expenses decreased by $0.4 million, as we began to capitalize certain overhead costs during the three months ended March 31, 2025. These decreases were partially offset by a $0.3 million increase in personnel-related expenses, including salaries, bonuses, and certain fringe benefits, resulting from an expansion in our workforce to support the ongoing development efforts of the WiSE CRT System; and a $0.1 million increase in clinical expenses, primarily resulting from higher travel expenses, including lodging, air travel and ground transportation due to patient follow-up visits for the SOLVE-CRT Study.
Previous wording
General and administrative expenses increased by $1.0 million, or 56.6%, during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023. Professional fees increased by $0.7 million, primarily resulting from higher accounting and legal related services in connection with preparation for the Form 10 filing. Personnel-related expenses including salaries, bonuses, stock-based compensation and certain fringe benefits increased by $0.2 million as a result of the expansion of our workforce to support our growth. Corporate expenses increased by $0.1 million, primarily resulting from the higher expenses related to investor relations.
Current wording
General and administrative expenses increased by $2.2 million, or 100.8%, during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. Personnel-related expenses including salaries, bonuses, stock-based compensation and certain fringe benefits increased by $1.2 million as a result of the expansion of our workforce to support our commercialization effort in anticipation of FDA approval of the WiSE CRT System. Professional fees increased by $0.6 million, primarily resulting from higher accounting and legal related services associated with being a public filer in the US. Travel expenses increased by $0.3 million, which included higher lodging, air travel and ground transportation expenses resulting from travel required for training of the commercial team. Corporate expenses increased by $0.1 million, primarily resulting from the higher expenses related to insurance premiums.
Previous wording
Other (expense) income, net increased by $0.5 million during the three months ended September 30, 2024, as compared to the three months ended September 30, 2023. This increase primarily resulted from $0.4 million decrease in interest income that the company earned on its investments in marketable securities, including the accretion of discounts on marketable securities, as well as $0.1 million increase in loss on foreign currency transactions driven by the foreign currency exchange rates fluctuations for the period.
Current wording
Other (expense) income, net increased by $0.2 million during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. This increase primarily resulted from a $0.3 million decrease in interest income earned on investments in marketable securities, including the accretion of discounts on marketable securities, which was partially offset by a $0.1 million decrease in interest expense.
Previous wording
We believe that we maintain a level of liquidity sufficient to allow us to meet our financial obligations as they become due for the next twelve months. We manage our cash and capital structure to maximize shareholder return, maintain its financial condition and maintain flexibility for future strategic initiatives. We continuously assess our working capital needs, debt and leverage levels, debt maturity schedule, capital expenditure requirements and future investments. As of September 30, 2024, and December 31, 2023, we had approximately $74.2 million and $73.4 million, respectively, in cash, cash equivalents, and marketable securities. Subsequently, on October 16, 2024, we raised approximately $2.6 million, net of issuance costs of approximately $0.2 million, from the retail component of a fully underwritten 1-for-20 pro-rata non-renounceable entitlement offer. In the long-term, our ability to support our working capital and capital expenditure requirements will depend on many factors, including:
Current wording
We manage our cash and capital structure to maximize shareholder return, maintain its financial condition and maintain flexibility for future strategic initiatives. We continuously assess our working capital needs, debt and leverage levels, debt maturity schedule, capital expenditure requirements and future investments. As of March 31, 2025 and December 31, 2024, we had approximately $50.2 million and $66.0 million, respectively, in cash, cash equivalents, and marketable securities. Based on our cash, cash equivalents, and marketable securities as of March 31, 2025, and our expectation to generate operating losses and negative operating cash flows in the foreseeable future, there exists substantial doubt regarding our ability to continue as a going concern for a period of at least twelve months from the date of this Form 10-Q.
Previous wording
As of September 30, 2024, and December 31, 2023, we had $1.2 million and $1.9 million in operating lease obligations, respectively, for our corporate headquarters and laboratory space, located in Sunnyvale, California. As of September 30, 2024, and December 31, 2023, the outstanding principal balance under our loan and security agreement described above was $41,800,000, which included the principal borrowings under tranche one and tranche two, as well as the final payment of 4.5% of the principal borrowings to date.
Current wording
As of March 31, 2025, the outstanding principal balance under our loan and security agreement described above was $41,800,000, which included the principal borrowings under tranche one and tranche two, as well as the final payment of 4.5% of the principal borrowings to date.
Previous wording
In addition, we have entered into an equipment purchase agreement for the purchase of certain software. As of September 30, 2024, and December 31, 2023, the outstanding principal balance was $59,657 and $21,496, respectively. Additionally, we enter into contracts in the normal course of business with third-party contract organizations for clinical trials, manufacturing and other services and products for operating purposes. In certain instances, our purchase agreements allow us to cancel, reschedule, or adjust our purchase requirements based on our business needs prior to firm orders being placed. Consequently, only a portion of our purchase commitments are firm and noncancelable. As of September 30, 2024, and December 31, 2023, our obligations under such arrangements were approximately $12.5 million and $3.5 million, respectively.
Current wording
In addition, we have entered into an equipment purchase agreement for the purchase of certain software. As of March 31, 2025, the outstanding principal balance was$14,914. Additionally, we enter into contracts in the normal course of business with third-party contract organizations for clinical trials, manufacturing and other services and products for operating purposes. In certain instances, our purchase agreements allow us to cancel, reschedule, or adjust our purchase requirements based on our business needs prior to firm orders being placed. Consequently, only a portion of our purchase commitments are firm and noncancelable. As of March 31, 2025, our obligations under such arrangements were approximately $16.2 million.
Previous wording
As of September 30, 2024, we had working capital of $67.9 million, comprised of current assets of $74.6 million and current liabilities of $6.7 million. Current assets, consisting of cash and cash equivalents, marketable securities, prepaid expenses, non-trade receivables and other current assets, increased by $0.2 million as of September 30, 2024, compared to December 31, 2023. Current liabilities, consisting primarily of accounts payable, accrued liabilities, lease obligations, the current portion of notes payable and interest payable, increased by approximately $0.3 million as of September 30, 2024, compared to December 31, 2023. The sale of common stock discussed above contributed to the overall increase in cash and cash equivalents, resulting in an increase in working capital as of September 30, 2024.
Current wording
As of March 31, 2025, we had working capital of $46.8 million, comprised of current assets of $53.5 million and current liabilities of $6.7 million. Current assets, consisting of cash and cash equivalents, marketable securities, pre-launch inventory, prepaid expenses, non-trade receivables and other current assets, decreased by $11.2 million as of March 31, 2025, compared to December 31, 2024. The decrease was primarily caused by a decrease in cash, cash equivalents and marketable securities as a result of cash used in operating activities for the three months ended March 31, 2025. Refer to the cash flows discussion below for further details. Current liabilities, consisting primarily of accounts payable, accrued liabilities, lease obligations, the current portion of notes payable and interest payable, decreased by approximately $1.8 million as of March 31, 2025, compared to December 31, 2024. The decrease primarily resulted from the payout of annual bonuses in January 2025, and a reduction in accounts payable from December 31, 2024 to March 31, 2025.
Previous wording
The following table summarizes our cash flows for the nine months ended September 30, 2024, and 2023:
Current wording
The following table summarizes our cash flows for the three months ended March 31, 2025 and 2024:
Previous wording
Net cash used in operating activities during the nine months ended September 30, 2024, was $30.2 million, compared to $23.2 million during the nine months ended September 30, 2023, representing an increase in use of $7.0 million. This increase is primarily attributed to an increase in net loss of $6.0 million, a decrease in non-cash adjustments of $0.1 million, and a use of cash from changes in working capital of $0.9 million.
Current wording
Net cash used in operating activities during the three months ended March 31, 2025, was $13.6 million, compared to $10.1 million during the three months ended March 31, 2024, representing an increase in use of $3.5 million. This increase is primarily attributed to an increase in net loss of $1.4 million, a decrease in cash from changes in working capital of $2.8 million, which were partially offset by an increase in non-cash adjustments of $0.7 million.
Previous wording
Net cash provided by investing activities during the nine months ended September 30, 2024, was $22.3 million, compared to $11.4 million the nine months ended September 30, 2023, representing an increase in cash provided of $10.9 million. The increase was attributable to a $10.1 million decrease in the purchase of marketable securities, as well as a $0.8 million increase in cash from the maturities and sales of marketable securities during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023.
Current wording
Net cash provided by investing activities during the three months ended March 31, 2025, was $17.9 million, compared to $3.0 million during the three months ended March 31, 2024, representing an increase in cash provided of $14.9 million. The increase was attributable to a $8.9 million decrease in the purchase of marketable securities, as well as a $6.0 million increase in cash from the maturities and sales of marketable securities during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
The following table summarizes our operating results for the nine months ended September 30, 2024, and 2023:
Previous report — wording carried elsewhere
The following table presents our total research and development expenses by category:
Previous report — wording carried elsewhere
General and administrative expenses increased by $3.2 million, or 61.9%, during the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023. Professional fees increased by $1.8 million, primarily resulting from higher accounting and legal related services in connection with preparation for the Form 10 filing. Personnel-related expenses including salaries, bonuses, stock-based compensation and certain fringe benefits increased by $1.1 million as a result of the expansion of our workforce to support our growth. Corporate expenses increased by $0.3 million, primarily resulting from the higher expenses related to investor relations.