Vivani Medical, Inc.

Previous wording

The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors. See “Cautionary Note Regarding Forward-Looking Statements.” The consolidated results of operations for the three months ended March 31, 2026 and 2025 are not necessarily indicative of the results that may be expected for any future period. The following discussion should be read in conjunction with the interim unaudited condensed consolidated financial statements and the notes thereto included in Item 1 of this Form 10-Q and the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”) and in conjunction with the “Risk Factors” included in Part II, Item 1A of this Form 10-Q.

Current wording

The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors. See “Cautionary Note Regarding Forward-Looking Statements.” The consolidated results of operations for the three andsix months ended June 30, 2026 and 2025 are not necessarily indicative of the results that may be expected for any future period. The following discussion should be read in conjunction with the interim unaudited condensed consolidated financial statements and the notes thereto included in Item 1 of this Form 10-Q and the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”) and in conjunction with the “Risk Factors” included in Part II, Item 1A of this Form 10-Q.

Previous wording

At Vivani, we are developing a portfolio of miniature, ultra long-acting subdermal drug implant candidates based on our NanoPortal technology that, unlike most oral and injectable medicines, are designed with the goal of guaranteeing medication adherence by delivering therapeutic drug levels for up to six months or longer. Our NanoPortal implant technology has the potential to enable patients to maintain continuous and therapeutic drug exposure levels with convenient once or twice-yearly administration and the ability to stop receiving therapy at any time, if necessary, by removing the implant. In addition, we aim to minimize fluctuations in patients’ drug levels which may improve the tolerability of medicines, including GLP-1 receptor agonists that produce side effects that are associated with fluctuating drug levels in the blood.

Current wording

At Vivani, we are developing a portfolio of miniature, ultra long-acting subdermal drug implant candidates based on our NanoPortal technology that, unlike most oral and injectable medicines, are designed with the goal of guaranteeing medication adherence by delivering therapeutic drug levels for up to six months or longer. Our NanoPortal implant technology has the potential to enable patients to maintain continuous and therapeutic drug exposure levels with convenient once or twice-yearly administration while still offering patients the ability to rapidly reverse GLP-1 drug exposure in patients when cessation of therapy is needed or desired. Reversibility can be an important clinical consideration in certain situations including when a woman becomes pregnant or when patients undergoing surgery have an increased aspiration risk. In addition, NanoPortal aims to minimize fluctuations in patients’ drug levels which may improve the tolerability of medicines, including GLP-1 receptor agonists that produce side effects that are associated with fluctuating drug levels in the blood.

Previous wording

Our emerging portfolio of miniature, ultra long-acting drug implant candidates have the potential to revolutionize the treatment of chronic diseases by directly addressing poor medication adherence and improving drug tolerability in patients, both of which may translate into better health outcomes for patients in the real-world setting. Our lead program, NPM-139, is a miniature, six-month, GLP-1 (semaglutide) implant currently in development for chronic weight management in obese and overweight patients. NPM-139 achieved encouraging preclinical data in rats showing approximately 20% weight loss, as compared to a control group receiving sham implants, which was maintained for a full year after a single administration. We are also developing NPM-133, a miniature, six-month, GLP-1 (semaglutide) implant for the treatment of type-2 diabetes. Preliminary feasibility data support the additional potential benefit of once yearly dosing for both semaglutide implant programs, NPM-139 and NPM-133. In addition, we are also developing NPM-115 (exenatide implant) for the treatment of chronic weight management, and OKV-119, a GLP-1-based implant in development for chronic weight management and related conditions in companion cats and dogs. OKV-119 is being developed in collaboration with animal health partner Okava Pharmaceuticals, Inc. (“Okava”).

Current wording

Our emerging portfolio of miniature, ultra long-acting drug implant candidates have the potential to revolutionize the treatment of chronic diseases by directly addressing poor medication adherence and improving drug tolerability in patients, both of which may translate into better health outcomes for patients in the real-world setting. Our lead program, NPM-139, is a miniature GLP-1 (semaglutide) implant designed for once- or twice-yearly administration, currently in development for chronic weight management in obese and overweight patients. NPM-139 achieved encouraging preclinical data in rats showing approximately 20% weight loss, as compared to a control group receiving sham implants, which was maintained for a full year after a single administration. We are also developing NPM-133, a miniature, six-month, GLP-1 (semaglutide) implant for the treatment of type-2 diabetes. Preliminary feasibility data support the additional potential benefit of once-yearly dosing for both semaglutide implant programs, NPM-139 and NPM-133. In addition, we are developing NPM-115 (exenatide implant) for the treatment of chronic weight management, and OKV-119, a GLP-1-based implant in development for chronic weight management and related conditions in companion cats and dogs. OKV-119 is being developed in collaboration with animal health partner Okava Pharmaceuticals, Inc. (“Okava”).

Previous wording

Vivani resulted from the business combination of Second Sight Medical Products, Inc. (“Second Sight”) and Nano Precision Medical, Inc. (“NPM”). On August 30, 2022, Second Sight and NPM completed their merger pursuant to which NPM became a wholly owned subsidiary of Second Sight and the combined company of NPM and Second Sight was renamed Vivani Medical, Inc. Our main priority is the further development of our miniature, ultra long-acting drug implant candidate programs. In parallel, our management team remains committed to identifying and exploring strategic options that will enable further development of its pioneering neurostimulation systems from legacy company Second Sight which are aimed at helping patients recover critical body functions. As noted below, we subsequently contributed our Second Sight assets and certain liabilities to Cortigent, Inc. (“Cortigent”), our wholly owned subsidiary, to advance our pioneering neurostimulation technology.

Current wording

Vivani resulted from the business combination of Second Sight Medical Products, Inc. (“Second Sight”) and Nano Precision Medical, Inc. (“NPM”). On August 30, 2022, Second Sight and NPM completed their merger pursuant to which NPM became a wholly owned subsidiary of Second Sight and the combined company of NPM and Second Sight was renamed Vivani Medical, Inc. We subsequently contributed our Second Sight assets and certain liabilities to Cortigent, Inc. (“Cortigent”), our wholly owned subsidiary, to advance our pioneering neurostimulation technology.

Previous wording

During thethree months ended March 31, 2026, we issued 5,179,488 shares of our common stock pursuant to the 2025 Private Sales Transactions, generating net proceeds of $5.7 million. The remaining shares issuable under these agreements are expected to be issued in 2026 upon completion of the applicable tranche closings, with expected gross proceeds of approximately $7.0 million.

Current wording

During thesix months ended June 30, 2026, we issued 9,941,391 shares of our common stock pursuant to the 2025 Private Sales Transactions, generating net proceeds of $11.6 million. The remaining shares issuable after June 30, 2026 under these agreements were issued upon completion of the final remaining tranche closing, which brought gross proceeds of approximately $1.0 million into the Company on July 15, 2026.

Previous wording

From time to time, we receive grants that help fund specific development programs. Any amounts received pursuant to grants are offset against the related operating expenses as the costs are incurred. Commencing in January 2018, we were awarded a grant from the National Institutes of Health (the “NIH”) to fund the “Early Feasibility Clinical Trial of a Visual Cortical Prosthesis”. The final year of the grant ended in March 2024, however, the NIH issued us a no-cost extension allowing us to utilize the unfunded amount through March 2025. During thethree months ended March 31, 2026 and 2025 total grants offsetting against operating expenses were $0 and $35,000, respectively.

Current wording

From time to time, we receive grants that help fund specific development programs. Any amounts received pursuant to grants are offset against the related operating expenses as the costs are incurred. Commencing in January 2018, we were awarded a grant from the National Institutes of Health (the “NIH”) to fund the “Early Feasibility Clinical Trial of a Visual Cortical Prosthesis”. The final year of the grant ended in March 2024, however, the NIH issued us a no-cost extension allowing us to utilize the unfunded amount through March 2025. During thesix months ended June 30, 2026 and 2025 total grants offsetting against operating expenses were $0 and $35,000, respectively.

Previous wording

We have experienced recurring operating losses and negative operating cash flows since inception and we expect to continue to incur operating losses and negative operating cash flows for the foreseeable future. To date, we have financed our working capital requirements through the recurring sale of our equity securities. Our condensed consolidated financial statements have been presented on the basis that our business is a going concern and contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Current wording

We have experienced recurring operating losses and negative operating cash flows since inception and we expect to continue to incur operating losses and negative operating cash flows for the foreseeable future. To date, we have financed our working capital requirements through the recurring sale of our equity securities. We estimate that currently available cash will provide sufficient funds to enable us to meet our planned obligations through the second quarter of 2027. Our ability to operate as planned beyond such date is dependent on our ability to raise additional capital, however, there can be no assurances that we will be able to do so. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued.

Previous wording

We are subject to the risks and uncertainties associated with a business with no revenue that is developing a novel pharmaceutical product candidates and medical device candidates, including limitations on our operating capital resources and uncertain demand for our products. We expect our operating expenses to increase significantly as we continue our business operations, particularly as we prepare to initiate additional clinical trials and conduct our other research and development activities. Conducting clinical trials is a time-consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval. We do not expect revenues until we are successful in completing the development and obtaining marketing approval for our products. We expect expenses to increase in connection with our ongoing activities, particularly as we initiate clinical trials, initiate new research and development projects and seek marketing approval for any product candidates that we successfully develop. If we are required to conduct additional nonclinical or clinical activities, or IND-enabling activities, our overall expenditures would increase. In addition, if we obtain marketing approval, we expect to incur significant additional expenses related to sales, marketing, distribution and other commercial infrastructure to commercialize such product. In addition, our product candidates, if approved, may not achieve commercial success. We incur significant costs associated with operating as a public company in a regulated industry.

Current wording

We are subject to the risks and uncertainties associated with a business with no revenue that is developing novel pharmaceutical product candidates, including limitations on our operating capital resources and uncertain demand for our products. We expect our operating expenses to increase significantly as we continue our business operations, particularly as we prepare to initiate additional clinical trials and conduct our other research and development activities. Conducting clinical trials is a time-consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval. We do not expect revenues until we are successful in completing development and obtaining marketing approval for our products. We expect expenses to increase in connection with our ongoing activities, particularly as we initiate clinical trials, initiate new research and development projects and seek marketing approval for any product candidates that we successfully develop. If we are required to conduct additional nonclinical or clinical activities, or IND-enabling activities, our overall expenditures would increase. In addition, if we obtain marketing approval, we expect to incur significant additional expenses related to sales, marketing, distribution and other commercial infrastructure to commercialize such product. In addition, our product candidates, if approved, may not achieve commercial success. We incur significant costs associated with operating as a public company in a regulated industry.

Previous wording

Until such time, if ever, we can generate product revenues, we anticipate that we will seek to fund our operations through public or private equity or debt financings, grants, collaborations, strategic partnerships or other sources. However, we may be unable to raise additional capital or enter into such other arrangements when needed on favorable terms or at all. To the extent that we raise additional capital through the sale of equity, convertible debt or other equity-linked securities, the ownership interests of some or all of our common stockholders will be diluted, the holders of new equity securities may have priority rights over our existing stockholders and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If adequate funds are not available, we may be required to curtail operations significantly or to obtain funds by entering into agreements on unattractive terms. If, for example, we raise funds through additional collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates, or to grant licenses on terms that may not be favorable to us. Our inability to raise capital could have a material adverse effect on our business, financial condition and results of operations.

Current wording

Until such time that we can generate product revenues, if ever, we anticipate that we will fund our operations through public or private equity or debt financings, grants, collaborations, strategic partnerships or other sources. However, we may be unable to raise additional capital or enter into such other arrangements when needed, on favorable terms or at all. To the extent that we raise additional capital through the sale of equity, convertible debt or other equity-linked securities, the ownership interests of some or all of our common stockholders will be diluted, the holders of new equity securities may have priority rights over our existing stockholders and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If adequate funds are not available, we may be required to curtail operations significantly or to obtain funds by entering into agreements on unattractive terms. If, for example, we raise funds through additional collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates, or to grant licenses on terms that may not be favorable to us. Our inability to raise capital could have a material adverse effect on our business, financial condition and results of operations.

Previous wording

The following discussion and analysis of financial condition and results of operations is based upon our interim unaudited condensed consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the United States of America. Certain accounting policies and estimates are particularly important to the understanding of our financial position and results of operations and require the application of significant judgment by our management or can be materially affected by changes from period to period in economic factors or conditions that are outside of our control. As a result, they are subject to an inherent degree of uncertainty. In applying these policies, our management uses their judgment to determine the appropriate assumptions to be used in the determination of certain estimates. Those estimates are based on our historical operations, our future business plans and projected financial results, the terms of existing contracts, our observance of trends in the industry, information provided by our customers and information available from other outside sources, as appropriate. See note 2 to our interim unaudited condensed consolidated financial statements included in Item 1 of this Form 10-Q for a more complete description of our significant accounting policies. During the three months ended March 31, 2026, there were no material changes to our critical accounting policies from those described in the 2025 Form 10-K.

Current wording

The following discussion and analysis of financial condition and results of operations is based upon our interim unaudited condensed consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the United States of America. Certain accounting policies and estimates are particularly important to the understanding of our financial position and results of operations and require the application of significant judgment by our management or can be materially affected by changes from period to period in economic factors or conditions that are outside of our control. As a result, they are subject to an inherent degree of uncertainty. In applying these policies, our management uses their judgment to determine the appropriate assumptions to be used in the determination of certain estimates. Those estimates are based on our historical operations, our future business plans and projected financial results, the terms of existing contracts, our observance of trends in the industry, information provided by our customers and information available from other outside sources, as appropriate. See note 2 to our interim unaudited condensed consolidated financial statements included in Item 1 of this Form 10-Q for a more complete description of our significant accounting policies. During thesix months ended June 30, 2026, there were no material changes to our critical accounting policies from those described in the 2025 Form 10-K.

Previous wording

Operating Expenses. We recognize our operating expenses as incurred in two general operational categories: research and development and general and administrative. Our operating expenses also include a non-cash component related to the amortization of stock-based compensation for research and development and general and administrative personnel. From time-to-time we have received grants from institutions or agencies, such as the NIH, to help fund some of the cost of our development efforts. We have recorded these grants as reductions to operating expenses.

Current wording

Operating Expenses. We recognize our operating expenses as incurred in two general operational categories: research and development and general and administrative. Our operating expenses also include a non-cash component related to the recognition of stock-based compensation for research and development and general and administrative personnel. From time-to-time we have received grants from institutions or agencies, such as the NIH, to help fund some of the cost of our development efforts. We have recorded these grants as reductions to operating expenses.

Previous wording

Research and development expense, net of grants. Research and development expense, net of grants, during thethree months ended March 31, 2026 was $4.4 million, compared to $4.2 million during thethree months ended March 31, 2025. Theincrease of $0.2 million, or 4%, was primarily attributable to the increase in both the clinical trial related expense and development expense from our Biopharm Division.

Current wording

Research and development expense, net of grants. Research and development expense, net of grants, during thethree months ended June 30, 2026 was $4.5 million, compared to $4.8 million during thethree months ended June 30, 2025. Thedecrease of $0.3 million, or 6%, was primarily attributable to a decrease in both the clinical trial related expense and development expense from our Biopharm Division.

Previous wording

General and administrative expense, net of grants. General and administrative expense, net of grants, during thethree months ended March 31, 2026 was $2.4 million, compared to $2.3 million during thethree months ended March 31, 2025. Theincrease of $0.1 million, or 4%, was primarily attributable to the increase in the professional services from our Neurostimulation Division and our Biopharm Division.

Current wording

General and administrative expense, net of grants. General and administrative expense, net of grants, during thethree months ended June 30, 2026 was $2.4 million, compared to $2.7 million during thethree months ended June 30, 2025. Thedecrease of $0.3 million, or 11%, was primarily attributable to a decrease in professional services from our Neurostimulation Division and our Biopharm Division.

Previous wording

Net loss. For the foregoing reasons, we had a net loss of $6.8 million during thethree months ended March 31, 2026 compared to $6.3 million during thethree months ended March 31, 2025.

Current wording

Net loss. For the foregoing reasons, we had a net loss of $6.4 million during thethree months ended June 30, 2026 compared to $7.1 million during thethree months ended June 30, 2025.

Previous wording

During the three months ended March 31, 2025, we used $5.2 million of cash in operating activities, consisting primarily of a net loss of $6.3 million, partially offset by $0.6 million a net change in operating assets and liabilities, and non-cash items totaling $0.5 million for depreciation and amortization of property and equipment, stock-based compensation and lease expense.

Current wording

During the six months ended June 30, 2026, we used $12.2 million of cash in operating activities, consisting primarily of a net loss of $13.2 million, partially offset by a $0.3 million net change in operating assets and liabilities, and non-cash items totaling $0.6 million.

Previous wording

During the three months ended March 31, 2026, we used $6.2 million of cash in operating activities, consisting primarily of a net loss of $6.8 million, partially offset by $0.1 million from a net change in operating assets and liabilities, and non-cash items totaling $0.5 million for stock-based compensation, lease expense, and depreciation of property and equipment.

Current wording

During the six months ended June 30, 2025, we used $11.3 million of cash in operating activities, consisting primarily of a net loss of $13.4 million, partially offset by a $1.1 million net change in operating assets and liabilities, and non-cash items totaling $1.1 million for stock-based compensation, lease expense, and depreciation of property and equipment.

Previous wording

Cash used for investing activities during the three months ended March 31, 2026 and 2025 was $3,000 and 5,000, respectively, for the purchase of property and equipment.

Current wording

Cash used for investing activities during the six months ended June 30, 2026 and 2025 was $0.1 million and $0.1 million, respectively, for the purchase of property and equipment.

Previous wording

Cash provided by financing activities was $9.7 million during thethree months ended March 31, 2026, primarily attributable to $2.2 million from a registered direct offering with a placement agent and $7.6 million from other securities purchase agreements with an affiliate of one of our independent directors and another investor.

Current wording

Cash provided by financing activities was $15.5 million during thesix months ended June 30, 2026, primarily attributable to net proceeds of $2.2 million from a registered direct offering with a placement agent and $13.6 million from other securities purchase agreements with an affiliate of one of our independent directors and another investor, offset by $0.2 million of principal payments for the insurance premium loan.

Previous wording

Cash used in financing activities was $0.2 million during the three months ended March 31, 2025, primarily attributable to $0.1 million of principal payments for the insurance premium loan, and $28,000 net financing costs associated with the common stock sales in connection the Sales Agreement.

Current wording

Cash used in financing activities was $0.3 million during the six months ended June 30, 2025, primarily attributable to $0.2 million of principal payments for the insurance premium loan, and $28,000 net financing costs associated with the common stock sales in connection with the Sales Agreement.