PULSE BIOSCIENCES INC
For the period ended Jun 30, 2024. Filed Aug 19, 2024.
View on SEC.govAbout this filing
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.
Jun 30, 2024 · Filed Aug 19, 2024
PLSE$53.29+0.4%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-07.
0001437749-24-015092
Item 1A. Risk FactorsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-19.
0001437749-24-027213
Item 1A. Risk FactorsThe 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 194 previous paragraphs and 189 current paragraphs.
180 unchanged; 7 reworded; 2 added; 7 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 137 previous and 136 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 (2)
Current report
If the interpretations, estimates or judgments we use to prepare our financial statements prove to be incorrect, investors and others may lose confidence in our financial data, which could cause our stock price to decline.
Current report
We, like all publicly traded companies, are subject to complex securities laws and regulations and accounting principles and interpretations. The preparation of our financial statements requires us to interpret accounting principles and guidance and to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting periods. We base our interpretations, estimates and judgments on our historical experience, appropriate accounting guidance and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for the preparation of our financial statements. However, accounting guidance can sometimes be conflicting, especially with respect to accounting for complex corporate transactions, such as accounting for the issuance of warrants as equity. Warrants classified as liabilities result in non-cash fair value measurement adjustments that are recorded in other income (expense). Moreover, generally accepted accounting principles presentation is subject to interpretation by the SEC, the Financial Accounting Standards Board (“FASB”) and various other bodies formed to interpret and create appropriate accounting principles and guidance. If one of these bodies disagrees with our accounting recognition, measurement or disclosure or any of our accounting interpretations, estimates or assumptions, we may have to retroactively revise our previously reported results and our investors could lose confidence in the accuracy and completeness of our financial reports, which could cause our stock price to decline.
Removed paragraphs (7)
Previous report
There is substantial doubt about our ability to continue as a going concern.
Previous report
To date, we have generated limited revenue from product sales and have incurred significant operating losses in each year since our inception and we anticipate that losses may continue for the next several years or until such time as we can generate substantial product revenue and achieve profitability. In connection with the preparation of this Quarterly Report for the three months ended March 31, 2024, our management has concluded that there is substantial doubt as to whether we can continue as a going concern for the twelve months following the issuance of this Quarterly Report. Our ability to continue as a going concern is dependent upon raising capital to maintain current operations and continue research and development efforts. We plan to raise additional capital to fund our operations. There is no assurance that additional financing will be available when needed or that our management will be able to obtain financing on terms acceptable to us. Accordingly, our management cannot conclude that such plans will be effectively implemented within the twelve months from the date that our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report were issued. These factors, combined with our forecast of cash required to fund operations for a period of at least twelve months from the date that our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report were issued, raise substantial doubt about our ability to continue as a going concern.
Previous report
There will be many risks associated with our announced rights offering.
Previous report
There will be many risks associated with the Company’s recently announced rights offering (the "Proposed Rights Offering"). For example, the subscription rights and Units to be issued in the Proposed Rights Offering will be non-transferable, so there will be no market for them. There will be no public market for the warrants included in the Units either, and we do not expect a market to develop. We do not intend to list the respective warrants included in the Units on any securities exchange or other trading market. Without an active market, we cannot assure investors in the Proposed Rights Offering that they will be able to sell or otherwise transfer the warrants, as the liquidity of the warrants will be limited, and the market price of our common stock may never exceed the exercise price of the warrants, and in certain circumstances, the Company may call the warrants for redemption at a price of $0.01 per underlying share. Investors in the Proposed Rights Offering may never benefit from owning the warrants expected to be issued.
Previous report
Also, once set, the subscription price for Units in the Proposed Rights Offering will not necessarily relate to our book value, net worth or any other established criteria of value and may or may not be considered the fair value of the Units to be offered in the Proposed Rights Offering. The market price of our common stock may decline during or after the Proposed Rights Offering, including below the subscription price for the Units. There is no guarantee that by the time the shares and warrants are delivered to investors, the market price of our common stock will be above the subscription price for the Units or exercise price for the warrants. Further, because the exercise of rights by any investor is not revocable and because the rights are not transferrable, investors will not be able to revoke their subscriptions if the market price decreases prior to the delivery of the shares and warrants or transfer of the shares and warrants until after they are delivered. Likewise, we cannot assure investors that they will ever be able to sell shares of common stock received in the Proposed Rights Offering or that result from the exercise of warrants received in the Proposed Rights Offering at a price equal to or greater than the subscription price or exercise price.
Previous report
If a stockholder decides not to exercise its subscription rights in full, its percentage ownership and voting rights in Pulse Biosciences will experience dilution. Also, the tax treatment of the Proposed Rights Offering may be treated as a taxable event to stockholders on the record date. Also, because no minimum subscription is required and because we do not have formal commitments from our stockholders for the entire amount we seek to raise pursuant to the Proposed Rights Offering, we cannot assure stockholders of the amount of proceeds that we will receive from the Proposed Rights Offering. Although Robert W. Duggan, chairman of our board of directors and the beneficial owner of approximately 69% of our outstanding common stock, has indicated that he intends to participate in the Proposed Rights Offering, he has not indicated at what level nor has he made any formal binding commitment to do so. Additionally, we do not have formal commitments from our other stockholders for the amount we seek to raise pursuant to the Proposed Rights Offering.
Previous report
The Company filed a registration statement (including a prospectus) on Form S-3 with the SEC on April 3, 2024, as amended on each of April 15, 2024, April 23, 2024, April 25, 2024, and April 30, 2024. The registration statement covers, among other things, the Proposed Rights Offering. Before making any investment decision, stockholders should read the final prospectus in the registration statement (including the prospectus forming a part thereof), together with any prospectus supplement, that the Company will file prior to commencing the Proposed Rights Offering, and the documents incorporated by reference in the registration statement (including the prospectus forming a part thereof and any prospectus supplement), as well as the other documents the Company has filed with the SEC for more complete information about the Company and the Proposed Rights Offering. Stockholders may get these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov.
Reworded paragraphs (7)
Previous wording
Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information in this Annual Report, including our financial statements and related notes, which could have a material adverse effect on our business, financial condition, results of operations, and prospects. The risks described below are not the only risks facing us. Risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition, results of operations, and prospects. In addition, any worsening of the economic environment may exacerbate the risks described below, any of which could have a material impact on us.
Current wording
Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information in this Quarterly Report, including our financial statements and related notes, which could have a material adverse effect on our business, financial condition, results of operations, and prospects. The risks described below are not the only risks facing us. Risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition, results of operations, and prospects. In addition, any worsening of the economic environment may exacerbate the risks described below, any of which could have a material impact on us.
Previous wording
We may also face increased competition in the future as new companies enter our markets and as scientific developments surrounding electro-signaling therapeutics continue to accelerate. For example, the current standard of care in cardiac tissue ablation for the treatment of AF is the use of thermal ablation modalities, primarily the use of radiofrequency ablation. While we will seek to expand our technological capabilities to remain competitive, research and development by others may render our technology or product candidates obsolete or noncompetitive or result in treatments or cures superior to any therapy developed by us.
Current wording
We may also face increased competition in the future as new companies enter our markets and as scientific developments surrounding electro-signaling therapeutics continue to accelerate. For example, the current standard of care in cardiac tissue ablation for the treatment of AF is the use of thermal ablation modalities, primarily the use of radiofrequency ablation but has recently seen increased use of a different type of PFA called micro-PFA. While we will seek to expand our technological capabilities to remain competitive, research and development by others may render our technology or product candidates obsolete or noncompetitive or result in treatments or cures superior to any therapy developed by us.
Previous wording
We are highly dependent upon the principal members of our management team, including our Chief Executive Officer, Kevin Danahy, and our Chief Technology Officer, Darrin Uecker, and members of our scientific and engineering teams. These persons have significant experience and knowledge with sub-microsecond pulsed electric fields and more broadly in life sciences and medical technologies. The loss of any team member could impair our ability to design, identify, and develop new intellectual property and new scientific or product ideas. The loss of a key employee, the failure of a key employee to perform in his or her current position, or our inability to attract and retain skilled employees could result in our inability to continue to grow our business or to implement our business strategy. We compete for qualified management and scientific personnel with other life science companies, academic institutions, and research institutions. Our employees could leave our Company with little or no prior notice. They are free to work for a competitor. If one or more of our senior executives or other key personnel were unable or unwilling to continue in their present positions, we may not be able to replace them easily or at all, and other senior management may be required to divert attention from other aspects of the business. In addition, we do not have “key person” life insurance policies covering any member of our management team or other key personnel. The loss of any of these individuals or any inability to attract or retain qualified personnel, including scientists, engineers, and others, could prevent us from pursuing collaborations and materially and adversely affect our product development and introductions, business growth prospects, results of operations, and financial condition.
Current wording
We are highly dependent upon the principal members of our management team, including our Chief Executive Officer, Burke Barrett, our Chief Commercial Officer, Kevin Danahy, and our Chief Technology Officer, Darrin Uecker, and members of our scientific and engineering teams. These persons have significant experience and knowledge with sub-microsecond pulsed electric fields and more broadly in life sciences and medical technologies. The loss of any team member could impair our ability to design, identify, and develop new intellectual property and new scientific or product ideas. The loss of a key employee, the failure of a key employee to perform in his or her current position, or our inability to attract and retain skilled employees could result in our inability to continue to grow our business or to implement our business strategy. We compete for qualified management and scientific personnel with other life science companies, academic institutions, and research institutions. Our employees could leave our Company with little or no prior notice. They are free to work for a competitor. If one or more of our senior executives or other key personnel were unable or unwilling to continue in their present positions, we may not be able to replace them easily or at all, and other senior management may be required to divert attention from other aspects of the business. In addition, we do not have “key person” life insurance policies covering any member of our management team or other key personnel. The loss of any of these individuals or any inability to attract or retain qualified personnel, including scientists, engineers, and others, could prevent us from pursuing collaborations and materially and adversely affect our product development and introductions, business growth prospects, results of operations, and financial condition.
Previous wording
Successfully commercializing medical devices such as ours is a complex and uncertain process. We began marketing and selling the CellFX System in the United States, Canada, and certain limited European markets in late 2021 to dermatologists through a limited direct sales force. In January 2022, we established an operating company in the Netherlands to further enhance our operations in Europe. However, in 2022 and 2023 we eliminated all of our full-time sales and marketing positions and, as of December 31, 2023, we had no U.S. or international sales force. We have only just recently begun to hire employees to help market and sell our CellFX nsPFA Percutaneous Electrode System. As of March 2024, our U.S. sales and marketing team consisted of just two employees, a Vice President focusing on the surgical ablation market and a Global Senior Director focusing on the minimally invasive surgery market. We therefore have limited experience marketing and selling the CellFX System and our revenues and cash flows have been volatile and difficult to predict.
Current wording
Successfully commercializing medical devices such as ours is a complex and uncertain process. We began marketing and selling the CellFX System in the United States, Canada, and certain limited European markets in late 2021 to dermatologists through a limited direct sales force. In January 2022, we established an operating company in the Netherlands to further enhance our operations in Europe. However, in 2022 and 2023 we eliminated all of our full-time sales and marketing positions and, as of December 31, 2023, we had no U.S. or international sales force. We have only just recently begun to hire employees to help market and sell our CellFX nsPFA Percutaneous Electrode System. We therefore have limited experience marketing and selling the CellFX System and our revenues and cash flows have been volatile and difficult to predict.
Previous wording
The risk of failure of clinical development is high. For example, the vast majority of our in vivo data has been a result of animal testing outside of cardiac animal models, and we have only completed a limited number of feasibility studies in humans, most of which have examined the use of our CellFX System in dermatologic conditions, even though we have been conducting a clinical study of our percutaneous electrode in Italy and a clinical study of our cardiac catheter in the Czech Republic. Undesirable side effects caused by the CellFX System, NPS pulses, or any of our planned future products could cause us, any partners of ours, or regulatory authorities to interrupt, delay or halt clinical trials or to revoke previously granted regulatory approvals. Undesirable side effects could also result in more restrictive labeling requirements or the delay or denial of regulatory approval of planned future products by the FDA or other comparable foreign regulatory authority.
Current wording
The risk of failure of clinical development is high. For example, the vast majority of ourin vivo data has been a result of animal testing outside of cardiac animal models, and we have only completed a limited number of feasibility studies in humans, most of which have examined the use of our CellFX System in dermatologic conditions, even though we have been conducting a clinical study of our percutaneous electrode in Italy, a clinical study for our cardiac clamp in the Netherlands and a clinical study of our cardiac catheter in the Czech Republic. Undesirable side effects caused by the CellFX System, NPS pulses, or any of our planned future products could cause us, any partners of ours, or regulatory authorities to interrupt, delay or halt clinical trials or to revoke previously granted regulatory approvals. Undesirable side effects could also result in more restrictive labeling requirements or the delay or denial of regulatory approval of planned future products by the FDA or other comparable foreign regulatory authority.
Previous wording
A majority percentage of our outstanding stock is held by Robert W. Duggan, Executive Chairman of our Board, who beneficially owns approximately 69% of our common stock outstanding as of the date of this Annual Report. As a result, Mr. Duggan has control over corporate actions requiring stockholder approval, including the following actions:
Current wording
A majority percentage of our outstanding stock is held by Robert W. Duggan, Executive Chairman of our Board, who beneficially owns approximately 69% of our common stock outstanding as of the date of this Quarterly Report. As a result, Mr. Duggan has control over corporate actions requiring stockholder approval, including the following actions:
Previous wording
Robert W. Duggan is our Executive Chairman, and he beneficially owns approximately 69% of our common stock outstanding as of the date of this Annual Report. In addition, Mr. Duggan is not subject to any contractual restrictions on his ability to acquire additional shares of common stock, and any such purchases, including purchases of equity securities in connection with any rights offerings or any alternative equity or equity-linked offering that we may conduct, could result in his acquisition of a majority of our common stock. As a result of Mr. Duggan’s controlling ownership and position as Executive Chairman, others may be less inclined to pursue an acquisition of us and therefore we may not have the opportunity to be acquired in a transaction that stockholders might otherwise deem favorable, including transactions in which our stockholders might realize a substantial premium for their shares. In addition, public speculation regarding Mr. Duggan, as well as our relationship with Mr. Duggan, could cause our stock price to fluctuate.
Current wording
Robert W. Duggan is our Executive Chairman, and he beneficially owns approximately 69% of our common stock outstanding as of the date of this Quarterly Report. In addition, Mr. Duggan is not subject to any contractual restrictions on his ability to acquire additional shares of common stock, and any such purchases, including purchases of equity securities in connection with any rights offerings or any alternative equity or equity-linked offering that we may conduct, could result in his acquisition of a majority of our common stock. As a result of Mr. Duggan’s controlling ownership and position as Executive Chairman, others may be less inclined to pursue an acquisition of us and therefore we may not have the opportunity to be acquired in a transaction that stockholders might otherwise deem favorable, including transactions in which our stockholders might realize a substantial premium for their shares. In addition, public speculation regarding Mr. Duggan, as well as our relationship with Mr. Duggan, could cause our stock price to fluctuate.