Neuraxis, INC
For the period ended Mar 31, 2025. Filed May 12, 2025.
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.
Mar 31, 2025 · Filed May 12, 2025
NRXS$6.24+2.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-12.
0001493152-24-044538
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-12.
0001641172-25-009571
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 46 previous paragraphs and 44 current paragraphs.
22 unchanged; 17 reworded; 5 added; 7 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 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 (5)
Current report
Selling expenses increased $53,924, or 67.4%, from $80,030 for the three months ended March 31, 2024, to $133,954 for the three months ended March 31, 2025, due to higher sales volume and a temporary commission structure to facilitate growth and adoption in new states.
Current report
Research and development expenses increased $54,986, or 987.2%, from $5,570 for the three months ended March 31, 2024, to $60,556 for the three months ended March 31, 2025, due to higher quarter-to-date spending on a medical research project and costs to develop the RED device.
Current report
Our operating loss increased $462,978, or 25.3%, from $1,832,120 for the three months ended March 31, 2024, to $2,295,098 for the three months ended March 31, 2025, primarily due to higher general and administrative expenses as a result of the settlement of a lawsuit partially offset by higher sales volume.
Current report
Other expense, net improved $304,945, or 105.7%, from $288,531 of expense for the three months ended March 31, 2024, to $16,414 of income for the three months ended March 31, 2025, primarily due to the absence of finance charges incurred in 2024 to settle a 2023 convertible note dispute and the full conversation of convertible notes to Series B Preferred Stock that eliminated any further interest expense and amortization of issuance costs.
Current report
Our net loss increased $158,033, or 7.5%, from $2,120,651 for the three months ended March 31, 2024, to $2,278,684 for the three months ended March 31, 2025, due to higher general and administrative expenses as a result of the settlement of a lawsuit partially offset by higher sales volume and the absence of financing charges, interest expense and issuance costs incurred on convertible notes.
Removed paragraphs (7)
Previous report
Selling expenses increased $31,220, or 48.6%, from $64,210 for the three months ended September 30, 2023, to $95,430 for the three months ended September 30, 2024 due to higher sales volume. Selling expenses decreased $24,559, or 9.8%, from $250,933 for the nine months ended September 30, 2023, to $226,374 for the nine months ended September 30, 2024 due to lower sales volume.
Previous report
Research and development expenses increased $27,472, or 61.1%, from $44,950 for the three months ended September 30, 2023, to $72,422 for the three months ended September 30, 2024 due to higher quarter-to-date spending in 2024 on a medical research project. Research and development expenses decreased $39,232, or 22.9%, from $171,536 for the nine months ended September 30, 2023 to $132,304 for the nine months ended September 30, 2024 due to higher year-to-date spending in 2023 on a medical research project.
Previous report
General and administrative expenses increased $682,947, or 10.8%, from $6,316,411 for the nine months ended September 30, 2023, to $6,999,358 for the nine months ended September 30, 2024 primarily due to (i) higher legal, insurance, investor relation, board of director and exchange listing costs as a publicly held entity that the Company did not incur prior to its IPO, (ii) incremental headcount to build out the market access, sales and finance teams, (iii) severance charges related to the Company’s prior Chief Operating Officer, (iv) one-time non-cash advisory costs, (v) a one-time non-cash stock compensation charge of $227,000 as a hiring grant, (vi) expenses related to the introduction of an annual short-term incentive bonus program, and (vii) higher advertising costs in order to expand market awareness, partially offset by non-recurrence of 2023 post-IPO consulting and recruiting services and the payment of incentive bonuses relating to the 2023 IPO.
Previous report
Our operating loss decreased $1,371,066, or 45.4%, from $3,022,339 for the three months ended September 30, 2023, to $1,651,273 for the three months ended September 30, 2024 primarily due to the absence of 2023 post-IPO consulting and recruiting services, 2023 incentive bonuses relating to the IPO and higher sales and gross profit in 2024, partially offset by incremental headcount, advisory costs, a new annual short-term incentive bonus plan and higher advertising costs in 2024. Our operating loss increased $648,935, or 12.9%, from $5,041,290 for the nine months ended September 30, 2023, to $5,690,225 for the nine months ended September 30, 2024 primarily due to new costs as a publicly held company that were not incurred prior to the 2023 IPO.
Previous report
Other expense decreased $5,499,063, or 98.1%, from $5,603,024 for the three months ended September 30, 2023, to $103,961 for the three months ended September 30, 2024 primarily due to the full conversion of the convertible notes upon the IPO on August 9, 2023, that eliminated any further debt discount, issuance cost and fair value derivative valuation net charges and lower interest expense and issuance cost amortization from a lower debt burden in 2024.
Previous report
Other expense decreased $6,889,724, or 86.2%, from $7,993,095 for the nine months ended September 30, 2023, to $1,103,371 for the nine months ended September 30, 2024 primarily due to the full conversion of the convertible notes upon the IPO on August 9, 2023, that eliminated any further debt discount, issuance cost, debt extinguishment and fair value derivative valuation net charges and lower interest expense and issuance cost amortization from a lower debt burden in 2024, partially offset by financing charges incurred to settle a 2023 convertible note dispute and other expense to settle certain claims of pre-IPO Series A Preferred Stock shareholders.
Previous report
Our net loss decreased $6,870,129, or 79.7%, from $8,625,363 for the three months ended September 30, 2023, to $1,755,234 for the three months ended September 30, 2024. Our net loss decreased $6,240,789, or 47.9%, from $13,034,385 for the nine months ended September 30, 2023, to $6,793,596 for the nine months ended September 30, 2024. The decreases were primarily due to (i) higher sales for the three months ended September 30, 2024 compared to the three months ended September 30, 2023, (ii) lower general and administrative expenses due to the absence of 2023 post-IPO consulting and recruiting services and the payment of incentive bonuses relating to the 2023 IPO, (iii) the elimination of debt discount, issuance cost and fair value derivative valuation net charges as a result of the conversion of notes upon the 2023 IPO and (iv) lower interest expense and issuance cost amortization from a lower debt burden in 2024, partially offset by financing charges incurred to settle a 2023 convertible note dispute and other expense to settle certain claims of pre-IPO Series A Preferred Stock shareholders.
Reworded paragraphs (17)
Previous wording
We are a growth stage company focused on developing neuromodulation therapies to address chronic and debilitating conditions in children. Our mission is to provide solutions that create value and provide better and safer patient outcomes. Our IB-Stim device is a PENFS system intended to be used in patients 11-18 years of age with functional abdominal pain associated with IBS. Our device already has market clearance from FDA for functional abdominal pain associated with IBS in children. Other indications in our pipeline are comprised of functional nausea in children, post-concussion syndrome in children, and cyclic vomiting syndrome in children. For more information, see “Business—Our Pipeline” and*“—Products*.”
Current wording
We are a growth stage company focused on developing neuromodulation therapies to address chronic and debilitating conditions in children. Our mission is to provide solutions that create value and provide better and safer patient outcomes. Our IB-Stim device is a PENFS system intended to be used in patients 8-21 years of age with functional abdominal pain associated with IBS and has market clearance from FDA for functional abdominal pain associated with IBS in children. Our RED device is an easy-to-use, office-based, point-of-care test that identifies patients with chronic constipation due to pelvic floor dyssynergia and has FDA market clearance for adults. Other indications in our pipeline are comprised of functional nausea in children, post-concussion syndrome in children, cyclic vomiting syndrome in children and functional abdominal pain associated with IBS in adults.
Previous wording
Since our inception, we have incurred significant operating losses. Our net loss was $1,755,234 and $8,625,363 for the three months ended September 30, 2024 and 2023, respectively, and $6,793,596 and $13,034,385 for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, we had an accumulated deficit of $1,793,932. Our auditors have expressed substantial doubt about our ability to continue as a going concern in their audit opinion. We expect to incur significant expenses and operating losses for the foreseeable future as we continue to pursue widespread insurance coverage of our IB-Stim device and seek FDA clearance of our device for other indications. There are a number of milestones and conditions that we must satisfy before we will be able to generate sufficient revenue to fund our operations, including FDA clearance of our IB-Stim device to treat future indications.
Current wording
Since our inception, we have incurred significant operating losses. Our net loss was $2,278,684 and $2,120,651 for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, we had stockholders’ equity of $258,479. Our auditors have expressed substantial doubt about our ability to continue as a going concern in their audit opinion. We expect to incur significant expenses and operating losses for the foreseeable future as we continue to pursue widespread insurance coverage of our IB-Stim device and seek FDA clearance of our device for other indications as we also fund sales and marketing efforts to expand the adoption of RED. There are a number of milestones and conditions that we must satisfy before we will be able to generate sufficient revenue to fund our operations, including FDA clearance of our IB-Stim device to treat future indications.
Previous wording
Our revenue is derived from the sale of our IB-Stim device to healthcare companies, primarily hospitals and clinics. Sales generally are not seasonal and only mildly correlated with economic cycles. Our IB-Stim device sells for $1,195 per device, and each child being treated for functional abdominal pain associated with IBS will use three to four devices. Potential patients with future indications are expected to use six or more devices per patient.
Current wording
Our revenue is derived from the sale of our IB-Stim device to healthcare companies, primarily hospitals and clinics. Sales generally are not seasonal and only mildly correlated with economic cycles. Our IB-Stim device sells for $1,195 per device, and each child being treated for functional abdominal pain associated with IBS will use three to four devices. Potential patients with future indications are expected to use four to six or more devices per patient.
Previous wording
Inflation did not have a material impact on our operations for any applicable period, and we do not expect inflation to have a material impact on our operations for the foreseeable future.
Current wording
Given the current economic environment, we cannot predict whether inflation will have a material impact on our operations for the foreseeable future.
Previous wording
Costs of goods sold consist of costs paid for the IB-Stim device to our contract manufacturer along with shipping and handling costs and expired inventory charges. Expired inventory expense is related to our FDA clearance for our device in the treatment of functional abdominal pain associated with IBS in children. Specifically, a certain component of our IB-Stim device is cleared for a two-year period after the date the device is manufactured, and if the device is not sold in such period, we must take the device out of inventory and write it off. We had no expired inventory for the three and nine months ended September 30, 2024 and 2023. Expired inventory has not been material to our results. We have a fixed-price contract with the manufacturer of our IB-Stim device to produce the device. We expect production costs to remain relatively constant and only nominal inventory expirations in the foreseeable future.
Current wording
Costs of goods sold consist of costs paid for the IB-Stim device to our contract manufacturer along with shipping and handling costs and expired inventory charges. Expired inventory expense is related to our FDA clearance for our device in the treatment of functional abdominal pain associated with IBS in children. Specifically, a certain component of our IB-Stim device is cleared for a two-year period after the date the device is manufactured, and if the device is not sold in such period, we must take the device out of inventory and write it off. We had no expired inventory for the three months ended March 31, 2025 and 2024. Expired inventory has not been material to our results. We have a fixed-price contract with the manufacturer of our IB-Stim device to produce the device. We expect production costs to remain relatively constant and only nominal inventory expirations in the foreseeable future.
Previous wording
Research and development expense is attributable to our clinical trials and related efforts to have our IB-Stim device cleared by the FDA for other indications. We expect to incur future R&D expenses for other indications, such as functional nausea, post-concussion syndrome and cyclic vomiting syndrome in children.
Current wording
Research and development expense is attributable to our clinical trials and related efforts to have our IB-Stim and RED devices cleared by the FDA for other indications. We expect to incur future R&D expenses for other indications, such as functional nausea, post-concussion syndrome and cyclic vomiting syndrome in children.
Previous wording
General and administrative expense primarily consists of wages and benefits, professional fees including legal and audit, insurance, investor relations, advertising, facility costs, utilities and travel.
Current wording
General and administrative expense primarily consists of wages and benefits, professional fees, including legal, and audit, insurance, investor relations, advertising, facility costs, utilities and travel costs.
Previous wording
The following table presents our statements of operations for the three and nine months ended September 30, 2024 and 2023, respectively:
Current wording
The following table presents our statements of operations for the three months ended March 31, 2025 and 2024, respectively:
Previous wording
Net sales increased $189,165, or 39.6%, from $477,460 for the three months ended September 30, 2023, to $666,625 for the three months ended September 30, 2024. Net sales decreased $3,830, or 0.2%, from $1,928,590 for the nine months ended September 30, 2023, to $1,924,760 for the nine months ended September 30, 2024. The increase for the three months ended September 30, 2024 was primarily due to volume growth from new and existing full insurance reimbursement customers as well as growth in our financial assistance programs that provide discounts to patients without insurance coverage.
Current wording
Net sales increased $249,020, or 38.5%, from $646,635 for the three months ended March 31, 2024, to $895,655 for the three months ended March 31, 2025, due to volume growth from customers that provide full insurance reimbursement coverage and those participating in our financial assistance programs that provide discounts to patients without insurance coverage.
Previous wording
Gross profit increased $159,402, or 38.9%, from $410,173 for the three months ended September 30, 2023, to $569,575 for the three months ended September 30, 2024 due to higher sales volume. Despite the increase in sales volume, the decrease in gross margin from 85.9% for the three months ended September 30, 2023 to 85.4% for the three months ended September 30, 2024 was due to higher growth in the Company’s financial assistance programs that are discounted to patients without insurance coverage compared to the Company’s undiscounted full reimbursement customers. Gross profit decreased $29,779, or 1.8%, from $1,697,590 for the nine months ended September 30, 2023, to $1,667,811 for the nine months ended September 30, 2024 due to gross margin. The decrease in gross margin from 88.0% for the nine months ended September 30, 2023 to 86.7% for the nine months ended September, 2024 was due to growth in our financial assistance programs that are discounted to patients without insurance coverage despite higher sales volume.
Current wording
Gross profit increased $184,626, or 32.3%, from $571,554 for the three months ended March 31, 2024, to $756,180 for the three months ended March 31, 2025, due to higher sales volume. Despite the increase in sales volume, the decrease in gross margin from 88.4% for the three months ended March 31, 2024, to 84.4% for the three months ended March 31, 2025, was due to higher growth in the Company’s financial assistance programs that are discounted to patients without insurance coverage compared to the Company’s undiscounted full reimbursement customers and higher device manufacturing and shipping costs.
Previous wording
General and administrative expenses decreased $1,270,356, or 38.2%, from $3,323,352 for the three months ended September 30, 2023, to $2,052,996 for the three months ended September 30, 2024 primarily due to 2023 post-IPO consulting and recruiting services and the payment of incentive bonuses relating to the 2023 IPO that did not recur in 2024, partially offset by (i) incremental headcount to build out the market access, sales and finance teams including, (ii) 2024 one-time non-cash advisory costs, (iii) expenses related to the introduction of an annual short-term incentive bonus plan in 2024 and (iv) higher advertising costs in order to expand market awareness.
Current wording
General and administrative expenses increased $538,694, or 23.2%, from $2,318,074 for the three months ended March 31, 2024, to $2,856,768 for the three months ended March 31, 2025, primarily due to (i) expenses related to the introduction of annual short-term and long-term incentive plans that did not exist in 2024, (ii) higher advertising costs in order to expand market awareness, (iii) third party costs incurred to enhance the Company’s internal control environment and (iv) the settlement of a lawsuit, partially offset by a one-time hiring grant in 2024 to the Company’s Chief Financial Officer that did not recur in 2025 and lower legal, accounting, consulting, investor relations and insurance costs as new hires in 2024 have internally absorbed certain services.
Previous wording
We had cash on hand of $260,885 and $761,249 as of September 30, 2024 and 2023, respectively. We maintained a working capital deficit of $2,032,284 and $1,643,058 as of September 30, 2024 and December 31, 2023, respectively. The decrease in working capital was primarily due to the unpaid severance, annual bonus and consulting fees that were not incurred in 2023.
Current wording
We had cash on hand of $2,005,370 and $3,696,870 as of March 31, 2025, and December 31, 2024, respectively. We maintained a working capital surplus of $439,823 and $1,832,858 as of March 31, 2025, and December 31, 2024, respectively. The decrease in working capital was primarily due to the utilization of cash to fund the Company’s net loss during the three months ended March 31, 2025.
Previous wording
We have incurred losses since inception and have funded our operations primarily with a combination of sales, debt, and the sale of capital stock. As of September 30, 2024, we had an accumulated deficit of $1,793,932 and short-term borrowings of $147,688.
Current wording
We have incurred losses since inception and have funded our operations primarily with a combination of sales, debt, and the sale of capital stock. As of March 31, 2025, we had stockholders’ equity of $258,479 and short-term borrowings of $84,307.
Previous wording
The following table summarizes our cash flow from operating, investing and financing activities for the nine months ended September 30, 2024 and 2023:
Current wording
The following table summarizes our cash flow from operating, investing and financing activities for the three months ended March 31, 2025 and 2024:
Previous wording
Operating Activities– Net cash used in operating activities increased $275,678, or 6.8% for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 primarily due to a higher operating loss.
Current wording
Operating Activities– Net cash used in operating activities increased 271,495, or 20.4%, for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily due to delayed vendor payments during the three months ended March 31, 2024 as a result of the Company’s liquidity position at that time.
Previous wording
Investing Activities– Net cash used in investing activities decreased $27,965, or 50.2%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 due to lower capital expenditures.
Current wording
Investing Activities– Net cash used in investing activities increased $3,278, or 22.3%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, due to capital expenditures to manufacture the RED device.
Previous wording
Financing Activities– Net cash provided by financing activities decreased $77,512, or 1.7%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 primarily due to lower proceeds from the issuance of convertible notes in 2024 compared to the net IPO and notes payable proceeds in 2023.
Current wording
Financing Activities– Net cash (used in) provided by financing activities decreased $1,419,919, or 105.2%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to the issuance of convertible notes in 2024 that did not recur in 2025.