HeartBeam Inc
For the period ended Jun 30, 2024. Filed Aug 14, 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 14, 2024
BEAT$0.40+1.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-09.
0001779372-24-000006
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-14.
0001628280-24-037202
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 61 previous paragraphs and 64 current paragraphs.
31 unchanged; 22 reworded; 10 added; 6 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 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 (10)
Current report
We are currently analyzing the data and working on the other components of the second 510(k) application. We anticipate submitting this 510(k) application in the second half of 2024. The result of these two 510(k) submissions, when cleared by the FDA as anticipated, will be an ambulatory device, carried by patients, which can synthesize a 12L ECG for physician review.
Current report
We continue to anticipate that our limited launch of AIMIGo will occur by the end of 2024. This limited launch, focused on the AIMIGo 3L system, will provide the company with valuable feedback on the user experience and functionality of the system in a real world setting. We do not anticipate that the AIMIGo 3L system clearance will generate significant revenue before the 12L clearance.
Current report
Interactions with Industrial Players
Current report
MedTech Breakthrough Award
Current report
On May 13, 2024, we were selected as the winner of the “Best New ECG Technology Solution” award in the 8th annual MedTech Breakthrough Awards program. This awards program is conducted by MedTech Breakthrough, an independent market intelligence organization that recognizes the top companies, technologies and products in the global digital health and medical technology market.
Current report
General and administrative (“G&A”) expenses increased by approximately $0.3 million or 7% during the six months ended June 30, 2024. The increase in G&A expense is primarily related to non-cash stock-based compensation expense amounting to $0.7 million associated with additional awards granted since June 30, 2023, higher consulting costs of $0.3 million related to finance consultants, primarily offset by decrease in payroll cost of $0.5 million related to lower costs associated with transitioning our commercial team, decrease in lower investor relation costs, and legal costs incurred in this period compared to the prior period.
Current report
Research and development expenses (“R&D”) expenses increased by approximately $1.4 million or 92% during the three months ended June 30, 2024 as compared to the three months ended June 30, 2023. The increase in R&D expense is primarily related to increase in headcount of $0.4 million, increase of clinical and AI related costs of $0.7 million, increase in consulting spend of $0.3 million offset by decrease in product development consulting cost of $0.4 million primarily driven by completion of milestone projects in prior period.
Current report
Net cash provided by financing activities during the six months ended June 30, 2023, of $24.9 million, is primarily from net proceeds of $23.2 million from the issuance of common stock under the Placement Agency Agreement, $1.1 million net proceeds from the issuance of common stock under a registered direct offering and $0.5 million from the issuance of common stock under the SPA.
Current report
Stock-based Compensation
Current report
The compensation cost for all stock-based awards is measured at the grant date, based on the fair value of the award, determined using a Black-Scholes option pricing model for stock options and fair value on the date of grant for non-vested restricted stock, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity award). Determining the fair value of stock-based awards at the grant date requires significant estimates and judgments. Management has determined the fair value and vesting period of stock-based compensation to be a critical accounting estimate due to certain options containing performance-based vesting condition.
Removed paragraphs (6)
Previous report
Currently we have enrolled more than 50% of the patients. We expect to complete enrollment in the VALID-ECG study in Q2 2024 and submit the second 510(k) application by Q3 2024. We continue to anticipate that our limited launch of AIMIGo will occur by the end of 2024.
Previous report
Interactions with Industrial Player
Previous report
Other Transactions and Events:
Previous report
In April 2024, we announced new data demonstrating that applying our AI algorithms to VCG showed considerably improved performance in the detection of atrial flutter over single-lead ECGs and similar performance to 12L ECGs, the standard for diagnosing atrial flutter. This marks the first scientific presentation on the company’s deep learning algorithm, HeartBeam AI. The data was presented at the European Heart Rhythm Association conference in Berlin, Germany. In the study, HeartBeam AI with VCG demonstrated a 28% improvement over single-lead ECG in the detection of atrial flutter cases without sacrificing the ability to identify those individuals without atrial flutter.
Previous report
We had no investing activity during the three months ended March 31, 2023.
Previous report
We had no financing activity during the three months ended March 31, 2024.
Reworded paragraphs (22)
Previous wording
We are a medical technology company focused on transforming cardiac care through the power of personalized insights. Our aim is to deliver innovative, higher resolution ambulatory cardiac monitoring solutions that can be used by patients anywhere to enable the detection and monitoring of cardiac disease outside of a healthcare facility. Our ability to develop higher resolution Electrocardiogram (“ECG”) solutions is achieved through the development of our proprietary and patented Vector Electrocardiography (“VECG”) technology platform. Our VECG technology is capable of capturing 3D vector images of the heart’s electrical activity and synthesizing a 12-Lead (“12L”) ECG from these signals. In early studies, our approach demonstrated equal or superior diagnostic capability than traditional hospital-based 12L ECG systems.
Current wording
We are a medical technology company focused on transforming cardiac care through the power of personalized insights. Our aim is to deliver innovative, higher resolution ambulatory cardiac monitoring solutions that can be used by patients anywhere to enable the detection and monitoring of cardiac disease outside of a healthcare facility. Our ability to develop higher resolution Electrocardiogram (“ECG”) solutions is achieved through the development of our proprietary and patented Vector Electrocardiography (“VECG”) technology platform. Our VECG technology is capable of capturing 3D vector signals of the heart’s electrical activity and synthesizing a 12-Lead (“12L”) ECG from these signals. In early studies, our approach demonstrated equal or superior diagnostic capability than traditional hospital-based 12L ECG systems.
Previous wording
Our Products require FDA clearance and have not been cleared for marketing.
Current wording
Our Products (“Product” or “Products”) require FDA clearance and have not been cleared for marketing.
Previous wording
We believe our Products and services will benefit many stakeholders, including patients, healthcare providers, and healthcare payors. We are developing our telehealth Product, (“HeartBeam AIMIGo TM” or “AIMIGo™”), to address the rapidly growing field of ambulatory cardiac health monitoring. HeartBeam AIMIGo is comprised of a credit card sized electrocardiogram device, a patient application, a physician portal, and powerful cloud-based algorithms. We believe that we are uniquely positioned to play a central role in ambulatory cardiac monitoring including high-risk Coronary Artery Disease (“CAD”) patients, because the initial studies have shown that our ischemia detection system may be more accurate than existing ambulatory monitoring solutions. CAD patients are at increased risk for a heart attack or Myocardial Infarction (“MI”).
Current wording
We believe our Products and services will benefit many stakeholders, including patients, healthcare providers, and healthcare payors. We are developing our telehealth Product, (“HeartBeam AIMIGo™” or “AIMIGo™”), to address the rapidly growing field of ambulatory cardiac health monitoring. HeartBeam AIMIGo is comprised of a credit card sized electrocardiogram device, a patient application, a physician portal, and powerful cloud-based algorithms. We believe that we are uniquely positioned to play a central role in ambulatory cardiac monitoring including high-risk Coronary Artery Disease (“CAD”) patients, because the initial studies have shown that our ischemia detection system may be more accurate than existing ambulatory monitoring solutions. CAD patients are at increased risk for a heart attack or Myocardial Infarction (“MI”).
Previous wording
To date, we have developed a working prototype for HeartBeam AIMIGo and have filed a 510(k) submission with the FDA. This submission is for the initial Product, a device which is a 3 lead X, Y, Z vector VECG. If cleared, we expect this to be the first patient-held VECG device to be cleared by the FDA and this will be a major milestone for the company. Following the FDA clearance of the AIMIGo device, we plan to file a submission for the software algorithms that synthesize a 12L ECG from the HeartBeam AIMIGo device. The result of these two 510(k) submissions, if cleared by the FDA, will be an ambulatory device, carried by patients, which can synthesize a 12L ECG for physician review.
Current wording
To date, we have developed a working prototype for HeartBeam AIMIGo and have filed a 510(k) submission with the FDA. This submission is for the initial Product, a device which is a 3 lead (3L) X, Y, Z vector VECG. We are in the substantive review phase of answering questions posed by the FDA on this submission. We have clarified the information requested in meetings with FDA representatives and are finalizing our official responses. During the second quarter of 2024 we received additional questions from FDA, have provided answers and additional data, and are engaged in productive discussions to finalize the clearance. If cleared as anticipated, we believe this will be the first patient-held VECG device to be cleared by the FDA and this will be a major milestone for the company.
Previous wording
In addition, we have held two Pre-submission meetings with FDA on the 12L synthesis submission. These meetings have been focused primarily on the performance goals of our clinical study that is designed to demonstrate the similarity between our synthesized 12L signal and the output of a standard 12L ECG. Based on feedback from FDA and our clinical experts, we have designed our clinical study, “Clinical Validation of AIMIGo 12 Lead ECG Synthesis Software for Arrhythmia Detection: A Prospective Multicenter Pivotal Study,” (the “VALID-ECG Study”).
Current wording
Following the FDA clearance of the AIMIGo 3L device, we plan to file a submission for the software algorithms that synthesize a 12L ECG from the HeartBeam AIMIGo device. We have held two Pre-submission meetings with FDA on this 12L synthesis submission. These meetings have been focused primarily on the performance goals of our clinical study that is designed to demonstrate the similarity between our synthesized 12L signal and the output of a standard 12L ECG. Based on feedback from FDA and our clinical experts, we have designed our clinical study, “Clinical Validation of AIMIGo 12 Lead ECG Synthesis Software for Arrhythmia Detection: A Prospective Multicenter Pivotal Study,” (the “VALID-ECG Study”).
Previous wording
On March 14, 2024, we enrolled the first patient in the VALID-ECG study. The VALID-ECG study is a prospective single-arm multicenter trial designed with the goal to validate the AIMIGo 12L ECG Synthesis Software by comparing its results with those of a standard FDA-cleared 12L ECG using both quantitative and qualitative assessment methodologies. We plan to enroll a total of approximately 198 patients presenting to an outpatient cardiology clinic or arrhythmia center for symptoms suggestive of cardiac arrhythmia or for routine checkup of previously diagnosed arrhythmia. The study includes 5 sites. The primary objective is to demonstrate the equivalence of ECG waveforms between AIMIGo
Current wording
On June 20, 2024, we completed patient enrollment in the VALID-ECG study. The VALID-ECG study is a prospective single-arm multicenter trial designed with the goal to validate the AIMIGo 12L ECG Synthesis Software by comparing its results with those of a standard FDA-cleared 12L ECG using both quantitative and qualitative assessment methodologies. We enrolled a total of 198 patients presenting to an outpatient cardiology clinic or arrhythmia center for symptoms suggestive of cardiac arrhythmia or for routine checkup of previously diagnosed arrhythmia. The study included five sites. The primary objective is to demonstrate the equivalence of ECG waveforms between AIMIGo Synthesized 12L ECG and Standard 12L ECG, recorded simultaneously in each subject, by assessing intervals and amplitudes.
Previous wording
We have developed initial deep learning algorithms, focused on the ability to detect various cardiac arrhythmias. HeartBeam has had data on its deep learning algorithm accepted for presentation at two prestigious Electrophysiology conferences. Data were presented at the European Heart Rhythm Association in Berlin, Germany in April 2024 and additional data will be presented at the Heart Rhythm Society, to be held in Boston MA in May 2024. We believe that, when combined with our Products, HeartBeam’s AI will provide additional value to patients and physicians in a number of ways, including:
Current wording
We have developed initial deep learning algorithms, focused on the ability to detect various cardiac arrhythmias. HeartBeam has had data on its deep learning algorithm accepted and presented at two prestigious Electrophysiology conferences. Data were presented at the European Heart Rhythm Association in Berlin, Germany in April 2024 and at the Heart Rhythm Society, in Boston MA in May 2024. We believe that, when combined with our Products, HeartBeam’s AI will provide additional value to patients and physicians in several ways, including:
Previous wording
As of March 31, 2024 we had 13 employees. We intend to hire or engage additional full-time professionals, employees, and / or consultants in alignment with our growth strategy. Although the market is highly competitive for attracting and retaining highly qualified professionals in our industry, we continue our endeavor to find such candidates for our Company. Our management team and additional personnel that we may hire in the future will be primarily responsible for executing and implementing growth opportunities, making tactical decisions related to our strategy and pursuing opportunities to invest in new technologies through strategic partnerships and acquisitions.
Current wording
As of June 30, 2024, we had 15 employees. We intend to hire or engage additional full-time professionals, employees, and / or consultants in alignment with our growth strategy. Although the market is highly competitive for attracting and retaining highly qualified professionals in our industry, we continue our endeavor to find such candidates for our Company. Our management team and additional personnel that we may hire in the future will be primarily responsible for executing and implementing growth opportunities, making tactical decisions related to our strategy and pursuing opportunities to invest in new technologies through strategic partnerships and acquisitions.
Previous wording
•We now have 13 issued U.S. patents and eleven pending U.S applications. Outside of the U.S., we have four issued patents in Germany, France, Netherlands and United Kingdom and twenty four pending applications in Canada, China, the European Union, Japan, South Korea and Australia. We also have one pending Patent Cooperation Treaty application. The issued patents are predicted to expire between April 11, 2036 and October 5, 2042.
Current wording
•We now have 13 issued U.S. patents and ten pending U.S applications. Outside of the U.S., we have four issued patents in Germany, France, Netherlands and United Kingdom and nineteen pending applications in Canada, China, the European Union, Japan, South Korea and Australia. We also have one pending Patent Cooperation Treaty application. The issued patents are predicted to expire between April 11, 2036 and March 4, 2044.
Previous wording
On May 2, 2024, we entered into the PV Sales Agreement with Public Ventures, pursuant to which we may offer and sell from time to time, at our option, through or to Public Ventures, up to an aggregate of approximately $17 million of shares of the Company’s common stock, $0.0001 par value per share (the “Shares”). We will pay Public Ventures a commission at a fixed rate of 3.0% of the aggregate gross proceeds from each sale of the Shares under the PV Sales Agreement. Currently, no shares have been issued under the PV Sales Agreement.
Current wording
On May 2, 2024, we entered into the PV Sales Agreement with Public Ventures, pursuant to which we may offer and sell from time to time, at our option, through or to Public Ventures, up to an aggregate of approximately $17 million of shares of the Company’s common stock, $0.0001 par value per share (the “Shares”). We will pay Public Ventures a commission at a fixed rate of 3.0% of the aggregate gross proceeds from each sale of the Shares under the PV Sales Agreement. There were 50,000 shares issued under the ATM during the three months ended June 30, 2024. As of June 30, 2024, there was approximately $16.9 million available for issuance under the ATM following the use of the shelf registration on Form S-3 for the Agreements and the ATM during the quarter.
Previous wording
In order to proceed with the PV Sales Agreement, we terminated the prior Sales Agreement with A.G.P.
Current wording
In order to proceed with the PV Sales Agreement, we terminated the prior Sales Agreement with A.G.P/Alliance Global Partners.
Previous wording
Summary of Statements of Operations for the three months ended March 31, 2024 compared with the three months ended March 31, 2023:
Current wording
Summary of Statements of Operations for the three and six months ended June 30, 2024 compared with the three and six months ended June 30, 2023:
Previous wording
General and administrative (“G&A”) expenses decreased by approximately $0.1 million or (5%) during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023. The decrease in G&A expense is primarily related to lower costs associated with our commercial team during the quarter ended March 31, 2023, lower investor relation costs, and marketing costs incurred in this quarter compared to the prior period primarily offset by non-cash stock-based compensation expense amounting to $0.6 million associated with additional awards granted since March 31, 2023.
Current wording
General and administrative (“G&A”) expenses increased by approximately $0.4 million or 23% during the three months ended June 30, 2024 as compared to the three months ended June 30, 2023. The increase in G&A expense is primarily related to non-cash stock-based compensation expense amounting to $0.1 million associated with additional awards granted since June 30, 2023, higher consultants costs of $0.3 million primarily offset by lower legal costs in this quarter compared to the prior period.
Previous wording
Research and development expenses (“R&D”) expenses increased by approximately $0.8 million or (44%) during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023. The increase in R&D expense is primarily related to non-cash stock-based compensation expense amounting to $0.2 million associated with additional awards granted since March 31, 2023 as well as the increase in headcount $0.6 million and clinical trial costs amounting to $0.3 million, primarily offset by completion of the initial development costs of the AIMIGo platform when compared to March 31, 2023.
Current wording
Research and development expenses (“R&D”) expenses increased by approximately $2.1 million or 67% during the six months ended June 30, 2024 as compared to the six months ended June 30, 2023. The increase in R&D expense is primarily related to increase in headcount of $0.9 million and non-cash stock-based compensation expense amounting to $0.4 million associated with additional awards granted since June 30, 2023, increase of clinical and AI related costs of $1.2 million, increase in consulting spend of $0.2 million offset by decrease in product development consulting cost of $0.9 million primarily driven by completion of milestone projects in prior period.
Previous wording
Other income during the three months ended March 31, 2024 and 2023 is related to interest earned on our cash balances.
Current wording
Other income during the three and six months ended June 30, 2024 and 2023 is related to interest earned on our cash balances.
Previous wording
We have incurred losses each year since inception and has experienced negative cash flows from operations in each year since inception. As of March 31, 2024, we have cash and cash equivalents balance of approximately $12.6 million. Based on our current business plan assumptions and expected cash burn rate, we believe that the existing cash is insufficient to fund operations for the next twelve months following the issuance of these financial statements. These factors raise substantial doubt regarding our ability to continue as a going concern.
Current wording
We have incurred losses each year since inception and has experienced negative cash flows from operations in each year since inception. As of June 30, 2024, we have cash and cash equivalents balance of approximately $9.2 million. Based on our current business plan assumptions and expected cash burn rate, we believe that the existing cash is insufficient to fund operations for the next twelve months following the issuance of these financial statements. These factors raise substantial doubt regarding our ability to continue as a going concern.
Previous wording
As of March 31, 2024, we had approximately $12.6 million in cash, a decrease of $3.6 million from $16.2 million as of December 31, 2023.
Current wording
As of June 30, 2024, we had approximately $9.2 million in cash, a decrease of $7.0 million from $16.2 million as of December 31, 2023.
Previous wording
Cash flows for the three months ended March 31, 2023 and 2022 (in thousands):
Current wording
Cash flows for the six months ended June 30, 2024 and 2023 (in thousands):
Previous wording
Net cash used in our operating activities of $3.5 million during the three months ended March 31, 2024, is primarily due to our net loss of $4.6 million less $1.2 million in non-cash expenses and $0.1 million of net changes in operating assets and liabilities.
Current wording
Net cash used in our operating activities of $7.0 million during the six months ended June 30, 2024, is primarily due to our net loss of $9.5 million less $2.2 million in non-cash expenses and $0.3 million of net changes in operating assets and liabilities.
Previous wording
Net cash used in our operating activities of $3.1 million during the three months ended March 31, 2023, is primarily due to our net loss of $4.1 million less $0.4 million in non-cash expenses and $0.6 million of net changes in operating assets and liabilities.
Current wording
Net cash used by our operating activities of $7.1 million during the six months ended June 30, 2023, is primarily due to our net loss of $7.3 million less $1.1 million in non-cash expenses, offset by $0.9 million of net changes in operating assets and liabilities.
Previous wording
Net cash used in investing activities during the three months ended March 31, 2024 of $0.1 million, is from the purchase of equipment.
Current wording
Net cash used in investing activities during the six months ended June 30, 2024 of $0.1 million, is from the purchase of property and equipment.
Previous wording
Net cash provided by financing activities during the three months ended March 31, 2023 of $0.5 million, is from the issuance of common stock.
Current wording
During the six months ended June 30, 2024, net cash provided by financing activities during the six months ended June 30, 2024, of $0.1 million is primarily from net proceeds from sale of equity, net of issuance costs.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash used in investing activities during the six months ended June 30, 2023, of $3.9 million, is from the purchase of short-term investments.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
We have had productive discussions with the FDA on both products. On the first submission, we are in the substantive review phase of answering questions posed by the FDA. We have clarified the information requested in meetings with FDA representatives and are finalizing our official responses. We currently anticipate clearance by the end of Q2 2024.
Previous report — wording carried elsewhere
Synthesized 12L ECG and Standard 12L ECG, recorded simultaneously in each subject, by assessing intervals and amplitudes.