Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 06, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Transition Report | false | |
Entity File Number | 001-35312 | |
Entity Registrant Name | NUWELLIS, INC. | |
Entity Central Index Key | 0001506492 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 68-0533453 | |
Entity Address, Address Line One | 12988 Valley View Road | |
Entity Address, City or Town | Eden Prairie | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55344 | |
City Area Code | 952 | |
Local Phone Number | 345-4200 | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | NUWE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 10,537,606 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 19,300 | $ 24,205 |
Accounts receivable | 951 | 750 |
Inventories | 3,294 | 2,843 |
Other current assets | 350 | 328 |
Total current assets | 23,895 | 28,126 |
Property, plant and equipment, net | 1,153 | 1,188 |
Operating lease right-of-use asset | 1,038 | 1,082 |
Other assets | 21 | 21 |
TOTAL ASSETS | 26,107 | 30,417 |
Current liabilities | ||
Accounts payable | 1,797 | 1,414 |
Accrued compensation | 1,335 | 1,664 |
Current portion of operating lease liability | 181 | 167 |
Current portion of finance lease liability | 24 | 26 |
Other current liabilities | 55 | 36 |
Total current liabilities | 3,392 | 3,307 |
Operating lease liability | 909 | 956 |
Finance lease liability | 22 | 28 |
Other long-term liability | 71 | 179 |
Total liabilities | 4,394 | 4,470 |
Commitments and contingencies | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Common stock as of March 31, 2022 and December 31, 2021, par value $0.0001 per share; authorized 100,000,000 shares, issued and outstanding 10,537,606 shares | 1 | 1 |
Additional paid-in capital | 279,114 | 278,873 |
Accumulated other comprehensive income: | ||
Foreign currency translation adjustment | (13) | (11) |
Accumulated deficit | (257,389) | (252,916) |
Total stockholders' equity | 21,713 | 25,947 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 26,107 | 30,417 |
Series A Junior Participating Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Series F Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Stockholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 39,969,873 | 39,969,873 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 10,537,606 | 10,537,606 |
Common stock, shares outstanding (in shares) | 10,537,606 | 10,537,606 |
Series A Junior Participating Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 30,000 | 30,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Series F Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 127 | 127 |
Preferred stock, shares issued (in shares) | 127 | 127 |
Preferred stock, shares outstanding (in shares) | 127 | 127 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Condensed Consolidated Statements of Operations and Comprehensive Loss [Abstract] | ||
Net sales | $ 1,926 | $ 1,918 |
Cost of goods sold | 824 | 952 |
Gross profit | 1,102 | 966 |
Operating expenses: | ||
Selling, general and administrative | 4,412 | 5,237 |
Research and development | 1,106 | 947 |
Total operating expenses | 5,518 | 6,184 |
Loss from operations | (4,416) | (5,218) |
Other income (expense), net | (55) | (1) |
Loss before income taxes | (4,471) | (5,219) |
Income tax expense | (2) | (2) |
Net loss | $ (4,473) | $ (5,221) |
Basic loss per share (in dollars per share) | $ (0.42) | $ (1.62) |
Diluted loss per share (in dollars per share) | $ (0.42) | $ (1.62) |
Weighted average shares outstanding - basic (in shares) | 10,538 | 3,242 |
Weighted average shares outstanding - diluted (in shares) | 10,538 | 3,242 |
Other comprehensive loss: | ||
Unrealized foreign currency translation adjustments | $ (2) | $ (3) |
Total comprehensive loss | $ (4,475) | $ (5,224) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid in Capital [Member] | Accumulated Other Comprehensive Income [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2020 | $ 0 | $ 249,663 | $ (7) | $ (233,338) | $ 16,318 |
Balance (in shares) at Dec. 31, 2020 | 2,736,060 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | $ 0 | 0 | 0 | (5,221) | (5,221) |
Unrealized foreign currency translation adjustments | 0 | 0 | (3) | 0 | (3) |
Stock-based compensation, net | $ 0 | 355 | 0 | 0 | 355 |
Stock-based compensation, net (in shares) | 0 | ||||
Issuance of common, net | $ 0 | 18,902 | 0 | 0 | 18,902 |
Issuance of common, net (in shares) | 3,795,816 | ||||
Exercise of warrants | $ 0 | 1 | 0 | 0 | 1 |
Exercise of warrants (in shares) | 66 | ||||
Balance at Mar. 31, 2021 | $ 0 | 268,921 | (10) | (238,559) | 30,352 |
Balance (in shares) at Mar. 31, 2021 | 6,531,942 | ||||
Balance at Dec. 31, 2021 | $ 1 | 278,873 | (11) | (252,916) | 25,947 |
Balance (in shares) at Dec. 31, 2021 | 10,537,606 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | $ 0 | 0 | 0 | (4,473) | (4,473) |
Unrealized foreign currency translation adjustments | 0 | 0 | (2) | 0 | (2) |
Stock-based compensation, net | $ 0 | 241 | 0 | 0 | 241 |
Stock-based compensation, net (in shares) | 0 | ||||
Balance at Mar. 31, 2022 | $ 1 | $ 279,114 | $ (13) | $ (257,389) | $ 21,713 |
Balance (in shares) at Mar. 31, 2022 | 10,537,606 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating Activities: | ||
Net loss | $ (4,473,000) | $ (5,221,000) |
Adjustments to reconcile net loss to cash flows used in operating activities: | ||
Depreciation and amortization | 105,000 | 126,000 |
Stock-based compensation expense, net | 241,000 | 355,000 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (201,000) | (14,000) |
Inventory | (451,000) | (89,000) |
Other current assets | (22,000) | (132,000) |
Other assets and liabilities | (80,000) | 24,000 |
Accounts payable and accrued expenses | 54,000 | (431,000) |
Net cash used in operating activities | (4,827,000) | (5,382,000) |
Investing Activities: | ||
Purchases of property and equipment | (70,000) | (56,000) |
Net cash used in investing activities | (70,000) | (56,000) |
Financing Activities: | ||
Proceeds from public stock offerings, net | 0 | 18,902,000 |
Proceeds from warrant exercises | 0 | 1,300 |
Payments on finance lease liability | (6,000) | (6,000) |
Net cash provided (used in) by financing activities | (6,000) | 18,897,000 |
Effect of exchange rate changes on cash | (2,000) | (3,000) |
Net increase (decrease) in cash and cash equivalents | (4,905,000) | 13,456,000 |
Cash and cash equivalents - beginning of period | 24,205,000 | 14,437,000 |
Cash and cash equivalents - end of period | 19,300,000 | 27,893,000 |
Supplemental cash flow information | ||
Inventory transferred to property, plant and equipment | $ 0 | $ 89,000 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2022 | |
Nature of Business and Basis of Presentation [Abstract] | |
Nature of Business and Basis of Presentation | Note 1 – Nature of Business and Basis of Presentation Nature of Business: Nuwellis, Inc. (the “Company”) is a medical device company focused on developing, manufacturing and commercializing the Aquadex FlexFlow® and Aquadex SmartFlow® systems (collectively, the “Aquadex System”) for ultrafiltration therapy. The Aquadex System is indicated for temporary (up to eight hours) or extended (longer than 8 hours in patients who require hospitalization) use in adult and pediatric patients weighing 20kg or more whose fluid overload is unresponsive to medical management, including diuretics. Nuwellis, Inc. is a Delaware corporation headquartered in Minneapolis with a wholly owned subsidiary in Ireland. The Company’s common stock began trading on the Nasdaq Capital Market in February 2012. In August 2016, the Company acquired the business associated with the Aquadex System (the “Aquadex Business”) from a subsidiary of Baxter International, Inc. (“Baxter”), and refocused its strategy to fully devote its resources to the Aquadex Business. On April 27, 2021, the Company announced that it was changing its name from CHF Solutions, Inc. to Nuwellis, Inc. to reflect Principles of Consolidation condensed consolidated balance sheet as of December 31, 2021, which has been derived from the consolidated audited financial statements and the consolidated These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Liquidity The Company’s consolidated financial statements have been prepared and presented on a basis assuming it continues as a going concern. During the years ended December 31, 2021, and 2020 and through March 31, 2022, the Company incurred losses from operations and net cash outflows from operating activities as disclosed in the consolidated statements of operations and cash flows, respectively. As of March 31, 2022, the Company had an accumulated deficit of $257.4 million and it expects to incur losses for the immediate future. To date, the Company has been funded by equity financings, and although the Company believes that it will be able to successfully fund its operations, there can be no assurance that it will be able to do so or that it will ever operate profitably. The Company became a revenue generating company after acquiring the Aquadex Business in August 2016. The Company expects to incur additional losses in the near-term as it grows the Aquadex Business, including investments in expanding its sales and marketing capabilities, purchasing inventory, manufacturing components, and complying with the requirements related to being a U.S. public company. To become and remain profitable, the Company must succeed in expanding the adoption and market acceptance of the Aquadex System. This will require the Company to succeed in training personnel at hospitals and in outpatient care settings, and effectively and efficiently manufacturing, marketing and distributing the Aquadex System and related components. There can be no assurance that the Company will succeed in these activities, and it may never generate revenues sufficient to achieve profitability. During 2021 and through March 31, 2022, the Company closed on underwritten public equity offerings for aggregate net proceeds of approximately $27.9 million after deducting the underwriting discounts and commissions and other costs associated with the offerings. In addition, during 2021 we received approximately $1,300 in proceeds from the exercise of investor warrants. See Note 3 Stockholders’ Equity for additional related disclosure. The Company will require additional funding to grow its Aquadex Business, which may not be available on terms favorable to the Company, or at all. The Company may receive those funds from the proceeds from future warrant exercises, issuances of The Company believes that its existing capital resources will be sufficient to support its operating plan through June 30, 2023. However, the Company may seek to raise additional capital to support its growth or other strategic initiatives through debt, equity or a combination thereof. There can be no assurance we will be successful in raising additional capital. Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification, Topic 606, Revenue from Contracts with Customers, which the Company adopted effective January 1, 2018. Accordingly, the Company recognizes revenue when its customers obtain control of its products or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods and services. See Note 2 – Revenue Recognition below for additional disclosures. For the three months ended March 31, 2022, two customers represented 14% and 10% of net sales. For the three months ended March 31, 2021, three customers represented 16%, 13% and 12% of net sales. Accounts Receivable : Accounts receivable are unsecured, are recorded at net realizable value, and do not bear interest. The Company makes judgments as to its ability to collect outstanding receivables based upon significant patterns of collectability, historical experience, and managements ’ Inventories : Inventories represent finished goods purchased from the Company’s suppliers and are recorded as the lower of cost or net realizable value using the first-in-first out method. Overhead is allocated to manufactured finished goods inventory based on the normal capacity of the Company’s production facilities. Abnormal amounts of overhead, if any, are expensed as incurred. Inventories consisted of the following: (in thousands) March 31, 2022 December 31, 2021 Finished Goods $ 1,331 $ 1,409 Work in Process 313 276 Raw Materials 1,650 1,158 Total $ 3,294 $ 2,843 Loss per share common stockholders for the three months ended March 31, 2021 includes a deemed dividend of $33,000 that resulted from the change in the exercise price of warrants as a result of the March 2021 offering. See Note 3 – Stockholders’ Equity below for additional disclosures Diluted earnings per share is computed based on the net loss allocable to common stockholders for each period divided by the weighted average number of common shares outstanding, increased by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued, and reduced by the number of shares the Company could have repurchased from the proceeds from issuance of the potentially dilutive shares. Potentially dilutive shares of common stock include shares underlying outstanding convertible preferred stock, warrants, stock options and other stock-based awards granted under stock-based compensation plans. The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented: March 31 2022 2021 Stock options 1,174,748 140,471 Warrants to purchase common stock 1,631,698 1,631,882 Series F convertible preferred stock 50,800 23,114 Total 2,857,246 1,795,467 The following table reconciles reported net loss with reported net loss per share for each of the three months ended March 31: (in thousands, except per share amounts) 2022 2021 Net loss $ (4,473 ) $ (5,221 ) Deemed dividend to preferred shareholders (see Note 3) — (33 ) Net loss after deemed dividend (4,473 ) (5,254 ) Weighted average shares outstanding 10,538 3,242 Basic and diluted loss per share $ (0.42 ) $ (1.62 ) Subsequent events: |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2022 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Note 2 – Revenue Recognition Net Sales Czech Republic, Revenue from product sales is recognized when the customer or distributor obtains control of the product, which occurs at a point in time, most frequently upon shipment of the product or receipt of the product, depending on shipment terms. The Company’s standard shipping terms are FOB shipping point unless the customer requests that control and title to the inventory transfer upon delivery. Revenue is measured as the amount of consideration we expect to receive, adjusted for any applicable estimates of variable consideration and other factors affecting the transaction price, which is based on the invoiced price, in exchange for transferring products. All revenue is recognized when the Company satisfies its performance obligations under the contract. The majority of the Company’s contracts have a single performance obligation and are short term in nature. The Company has entered into extended service plans with customers whose related revenue is recognized over time. This revenue represents less than 1% of net sales for the three months ended March 31, 2022, and 2021. The unfulfilled performance obligations related to these extended service plans is included in deferred revenue, which is included in other current liabilities on the consolidated balance sheets. The majority of the deferred revenue is expected to be recognized within one year. Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Revenue includes shipment and handling fees charged to customers. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of goods sold. Product Returns : The Company offers customers a limited right of return for its product in case of non-conformity or performance issues. The Company estimates the amount of its product sales that may be returned by its customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product return liabilities using available industry data and its own historical sales and returns information. The Company has not received any returns to date and believes that future returns of its products will be minimal. Therefore, revenue recognized is not currently impacted by variable consideration related to product returns. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | Note 3 – Stockholders’ Equity Series F Convertible Preferred Stock : On November 27, 2017, the Company closed on an underwritten public offering Series F convertible preferred stock and warrants to purchase shares of common stock for gross proceeds of $18.0 million. Net proceeds totaled approximately $16.2 million after deducting the underwriting discounts and commissions and other costs associated with the offering. The offering was comprised of Series F convertible preferred stock, convertible into shares of the Company’s common stock at an initial conversion price of $1,890.00 per share. Each share of Series F convertible preferred stock was accompanied by a Series 1 warrant (which expired on the first anniversary of its issuance) to purchase 16 shares of the Company’s common stock at an exercise price of $1,890.00 per share, and a Series 2 warrant, which expires on the seventh anniversary of its issuance, to purchase 16 shares of the Company’s common stock at an exercise price of $1,890.00 per share. The Series F convertible preferred stock has full ratchet price based anti-dilution protection, subject to customary carve outs, in the event of a down-round financing at a price per share below the conversion price of the Series F convertible preferred stock (which protection will expire if, during any 20 of 30 consecutive trading days, the volume weighted average price of the Company’s common stock exceeds 300% of the then-effective conversion price of the Series F convertible preferred stock and the daily dollar trading volume for each trading day during such period exceeds $200,000). The exercise price of the warrants is fixed and does not contain any variable pricing features, nor any price-based anti-dilutive features, apart from customary adjustments for stock splits, combinations, reclassifications, stock dividends or fundamental transactions. A total of 18,000 shares of Series F convertible preferred stock initially convertible into 9,557 shares of common stock and warrants to purchase 19,122 shares of common stock were issued in the offering. Effective March 12, 2019, the conversion price of the Series F convertible preferred stock was reduced from $890.40 to $157.50, the per share price to the public of the Series G convertible preferred stock issued in the March 2019 Offering. Effective October 25, 2019, the conversion price of the Series F convertible preferred stock was reduced from $157.50 to $42.30, and further reduced on November 6, 2019, from $42.30 to $29.83, the per share price to the public in the October and November 2019 transactions, respectively. Effective January 28, 2020, the conversion price of the Series F convertible preferred stock was reduced from $29.83 to $16.50, the per share price to the public of the Series H convertible preferred stock which closed in an underwritten public offering on January 28, 2020, described below. Effective March 23, 2020, the conversion price of the Series F convertible preferred stock was reduced from $16.50 to $9.00, the per share price to the public in the March 2020 transaction, described below. In connection with the September 2021 offering, the conversion price of the Series F convertible preferred stock was reduced from $5.50 to $2.50, the per share price to the public in the September 2021 offering, described below. As of March 31, 2022, and December 31, 2021, 127 shares of the Series F convertible preferred stock remained outstanding. March 2021 Offering : On March 19, 2021, the Company closed on an underwritten public offering of 3,795,816 shares of common stock, for gross proceeds of approximately $20.9 million (the “March 2021 Offering”). Net proceeds totaled approximately $18.9 million after deducting the underwriting discounts and commissions and other costs associated with the offering and after giving effect to the underwriters’ full exercise of their overallotment option. In connection with the March 2021 Offering, the conversion price of the Series F convertible preferred stock was reduced from $9.00 to $5.50, the per share price to the public in the March 2021 Offering. In addition, the exercise price of the common stock warrants issued in connection with the January 2020 Offering was reduced from $9.00 to $5.50, the per share price to the public in the March 2021 Offering. September 2021 Offering : On September 17, 2021, the Company closed on an underwritten public offering of 4,005,588 shares of common stock, for gross proceeds of approximately $10.0 million (the “September 2021 Offering”). Net proceeds totaled approximately $9.0 million after deducting the underwriting discounts and commissions and other costs associated with the offering and after giving effect to the underwriters’ full exercise of their overallotment option. In connection with the September 2021 Offering, the conversion price of the Series F convertible preferred stock was reduced from $5.50 to $2.50, the per share price to the public in the September 2021 Offering. In addition, the exercise price of the common stock warrants issued in connection with the January 2020 Offering was reduced from $5.50 to $2.50, the per share price to the public in the September 2021 Offering. Placement Agent Fees : In connection with the offerings described above, the Company paid the placement agent an aggregate cash placement fee equal to 8% of the aggregate gross proceeds raised in each of the offerings. Market-Based Warrants : On May 30, 2019, the Company granted a market-based warrant to a consultant in exchange for investor relations services. The warrant represents the right to acquire up to 3,334 shares of the Company’s common stock at an exercise price of $95.40 per share, the closing stock price of the Company’s common shares on May 30, 2019. The warrant is subject to a vesting schedule based on the Company achieving certain market stock prices within a specified period of time. The warrant expires on May 30, 2024. The warrant was valued at $57.90 per share using the Monte Carlo valuation methodology and was expensed over the term of the consulting engagement which was twelve months. Significant inputs used for the Monte Carlo valuation were the expected stock price volatility of 136.21%, and management’s expectations regarding the timing of regulatory clearance for an expanded label in pediatrics. None of these warrants had vested as of March 31, 2022. Reverse Stock Split : On October 6, 2020, the Company’s stockholders approved a reverse split of its outstanding common stock at a ratio in the range of 1-for-5 1-for-30 1-for-30 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | Note 4 - Stock-Based Compensation Under the fair value recognition provisions of U.S. GAAP for accounting for stock-based compensation, the Company measures stock-based compensation expense at the grant date based on the fair value of the award and recognizes the compensation expense over the requisite service period, which is generally the vesting period. The following table presents the classification of stock-based compensation expense recognized for the periods below: Three-months ended March 31, (in thousands) 2022 2021 Selling, general and administrative expense $ 214 $ 327 Research and development expense 27 28 Total stock-based compensation expense $ 241 $ 355 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Taxes [Abstract] | |
Income Taxes | Note 5 – Income Taxes The Company provides for a valuation allowance when it is more likely than not that it will not realize a portion of the deferred tax assets. The Company has established a full valuation allowance for U.S. and foreign deferred tax assets due to the uncertainty that enough taxable income will be generated in those taxing jurisdictions to utilize the assets. Therefore, the Company has not reflected any benefit of such deferred tax assets in the accompanying condensed consolidated financial statements. As of March 31, 2022, there were no material changes to what the Company disclosed regarding tax uncertainties or penalties in its Annual Report on Form 10-K for the year ended December 31, 2021. |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 31, 2022 | |
Operating Leases [Abstract] | |
Operating Leases | Note 6—Operating Leases The Company leases a 23,000 square foot facility located in Eden Prairie, Minnesota for |
Finance Lease Liability
Finance Lease Liability | 3 Months Ended |
Mar. 31, 2022 | |
Finance Lease Liability [Abstract] | |
Finance Lease Liability | Note 7—Finance Lease Liability In 2020, the Company entered into lease agreements to finance equipment valued at $98,000. The equipment consisted of computer hardware and audio-visual equipment and is included in Property, Plant and Equipment |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 8—Commitments and Contingencies Employee Retirement Plan: The Company has a 401(k)-profit sharing plan that provides retirement benefits to substantially all full-time U.S. employees. Eligible employees may contribute a percentage of their annual compensation, subject to Internal Revenue Service (“IRS”) limitations, with the Company matching a portion of the employees’ contributions at the discretion of the Company Non-refundable Technology License Fee: On June 24, 2021, the Company entered into a research and development collaboration agreement with Koronis Biomedical Corporation (KBT) to design and develop an integrated continuous renal replacement therapy device. This agreement became effective on August 5, 2021, when KBT received approval of a $1.7 million grant from the National Institutes of Health (NIH) to support this project. As part of this agreement, the Company pays KBT a non-refundable technology license fee of $428,160, payable in twelve equal monthly installments commencing on June 1, 2022. The Company has recorded a liability for the non-refundable technology license fee with $356,800 included in Current Accounts Payable and $71,360 included in Other Long-term Liabilities. The full amount of $428,160 was expensed and included in the Research and Development Expense line for the year ended December 31, 2021. |
Nature of Business and Basis _2
Nature of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Nature of Business and Basis of Presentation [Abstract] | |
Principles of Consolidation | Principles of Consolidation condensed consolidated balance sheet as of December 31, 2021, which has been derived from the consolidated audited financial statements and the consolidated These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. |
Liquidity | Liquidity The Company’s consolidated financial statements have been prepared and presented on a basis assuming it continues as a going concern. During the years ended December 31, 2021, and 2020 and through March 31, 2022, the Company incurred losses from operations and net cash outflows from operating activities as disclosed in the consolidated statements of operations and cash flows, respectively. As of March 31, 2022, the Company had an accumulated deficit of $257.4 million and it expects to incur losses for the immediate future. To date, the Company has been funded by equity financings, and although the Company believes that it will be able to successfully fund its operations, there can be no assurance that it will be able to do so or that it will ever operate profitably. The Company became a revenue generating company after acquiring the Aquadex Business in August 2016. The Company expects to incur additional losses in the near-term as it grows the Aquadex Business, including investments in expanding its sales and marketing capabilities, purchasing inventory, manufacturing components, and complying with the requirements related to being a U.S. public company. To become and remain profitable, the Company must succeed in expanding the adoption and market acceptance of the Aquadex System. This will require the Company to succeed in training personnel at hospitals and in outpatient care settings, and effectively and efficiently manufacturing, marketing and distributing the Aquadex System and related components. There can be no assurance that the Company will succeed in these activities, and it may never generate revenues sufficient to achieve profitability. During 2021 and through March 31, 2022, the Company closed on underwritten public equity offerings for aggregate net proceeds of approximately $27.9 million after deducting the underwriting discounts and commissions and other costs associated with the offerings. In addition, during 2021 we received approximately $1,300 in proceeds from the exercise of investor warrants. See Note 3 Stockholders’ Equity for additional related disclosure. The Company will require additional funding to grow its Aquadex Business, which may not be available on terms favorable to the Company, or at all. The Company may receive those funds from the proceeds from future warrant exercises, issuances of The Company believes that its existing capital resources will be sufficient to support its operating plan through June 30, 2023. However, the Company may seek to raise additional capital to support its growth or other strategic initiatives through debt, equity or a combination thereof. There can be no assurance we will be successful in raising additional capital. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with Accounting Standards Codification, Topic 606, Revenue from Contracts with Customers, which the Company adopted effective January 1, 2018. Accordingly, the Company recognizes revenue when its customers obtain control of its products or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods and services. See Note 2 – Revenue Recognition below for additional disclosures. For the three months ended March 31, 2022, two customers represented 14% and 10% of net sales. For the three months ended March 31, 2021, three customers represented 16%, 13% and 12% of net sales. |
Accounts Receivable | Accounts Receivable : Accounts receivable are unsecured, are recorded at net realizable value, and do not bear interest. The Company makes judgments as to its ability to collect outstanding receivables based upon significant patterns of collectability, historical experience, and managements ’ |
Inventories | Inventories : Inventories represent finished goods purchased from the Company’s suppliers and are recorded as the lower of cost or net realizable value using the first-in-first out method. Overhead is allocated to manufactured finished goods inventory based on the normal capacity of the Company’s production facilities. Abnormal amounts of overhead, if any, are expensed as incurred. Inventories consisted of the following: (in thousands) March 31, 2022 December 31, 2021 Finished Goods $ 1,331 $ 1,409 Work in Process 313 276 Raw Materials 1,650 1,158 Total $ 3,294 $ 2,843 |
Loss per Share | Loss per share common stockholders for the three months ended March 31, 2021 includes a deemed dividend of $33,000 that resulted from the change in the exercise price of warrants as a result of the March 2021 offering. See Note 3 – Stockholders’ Equity below for additional disclosures Diluted earnings per share is computed based on the net loss allocable to common stockholders for each period divided by the weighted average number of common shares outstanding, increased by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued, and reduced by the number of shares the Company could have repurchased from the proceeds from issuance of the potentially dilutive shares. Potentially dilutive shares of common stock include shares underlying outstanding convertible preferred stock, warrants, stock options and other stock-based awards granted under stock-based compensation plans. The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented: March 31 2022 2021 Stock options 1,174,748 140,471 Warrants to purchase common stock 1,631,698 1,631,882 Series F convertible preferred stock 50,800 23,114 Total 2,857,246 1,795,467 The following table reconciles reported net loss with reported net loss per share for each of the three months ended March 31: (in thousands, except per share amounts) 2022 2021 Net loss $ (4,473 ) $ (5,221 ) Deemed dividend to preferred shareholders (see Note 3) — (33 ) Net loss after deemed dividend (4,473 ) (5,254 ) Weighted average shares outstanding 10,538 3,242 Basic and diluted loss per share $ (0.42 ) $ (1.62 ) |
Subsequent events | Subsequent events: |
Nature of Business and Basis _3
Nature of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Nature of Business and Basis of Presentation [Abstract] | |
Inventories | Inventories consisted of the following: (in thousands) March 31, 2022 December 31, 2021 Finished Goods $ 1,331 $ 1,409 Work in Process 313 276 Raw Materials 1,650 1,158 Total $ 3,294 $ 2,843 |
Potential Shares of Common Stock not Included in Diluted Net Loss Per Share | The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented: March 31 2022 2021 Stock options 1,174,748 140,471 Warrants to purchase common stock 1,631,698 1,631,882 Series F convertible preferred stock 50,800 23,114 Total 2,857,246 1,795,467 |
Reconciliation of Reported Net Loss with Reported Net Loss Per Share | The following table reconciles reported net loss with reported net loss per share for each of the three months ended March 31: (in thousands, except per share amounts) 2022 2021 Net loss $ (4,473 ) $ (5,221 ) Deemed dividend to preferred shareholders (see Note 3) — (33 ) Net loss after deemed dividend (4,473 ) (5,254 ) Weighted average shares outstanding 10,538 3,242 Basic and diluted loss per share $ (0.42 ) $ (1.62 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stock-Based Compensation [Abstract] | |
Classification of Stock-Based Compensation Expense | The following table presents the classification of stock-based compensation expense recognized for the periods below: Three-months ended March 31, (in thousands) 2022 2021 Selling, general and administrative expense $ 214 $ 327 Research and development expense 27 28 Total stock-based compensation expense $ 241 $ 355 |
Nature of Business and Basis _4
Nature of Business and Basis of Presentation, Nature of Business, Going Concern, Accounts Receivable and Inventories (Details) | Sep. 17, 2021USD ($) | Mar. 31, 2022USD ($)Customer | Mar. 31, 2021USD ($)Customer | Dec. 31, 2021USD ($)Customer | Sep. 30, 2021USD ($) |
Going Concern [Abstract] | |||||
Accumulated deficit | $ (257,389,000) | $ (252,916,000) | $ (257,400,000) | ||
Net proceeds from issuance of convertible preferred stock | $ 27,900,000 | ||||
Proceeds from exercise of investor warrants | $ 0 | $ 1,300 | |||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Accounts receivables maximum credit period from invoice date | 30 days | ||||
Allowance for doubtful accounts | $ 0 | 0 | |||
Inventories [Abstract] | |||||
Finished Goods | 1,331,000 | 1,409,000 | |||
Work in Process | 313,000 | 276,000 | |||
Raw Materials | 1,650,000 | 1,158,000 | |||
Total | $ 3,294,000 | $ 2,843,000 | |||
Accounts Receivable [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Number of major customers | Customer | 1 | 2 | |||
Customer One [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Concentration risk percentage | 13.00% | 12.00% | |||
Customer Two [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Concentration risk percentage | 11.00% | ||||
ASC 606 [Member] | Net Sales [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Number of major customers | Customer | 2 | 3 | |||
ASC 606 [Member] | Customer One [Member] | Net Sales [Member] | Customer Concentration Risk [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Concentration risk percentage | 14.00% | 16.00% | |||
ASC 606 [Member] | Customer Two [Member] | Net Sales [Member] | Customer Concentration Risk [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Concentration risk percentage | 10.00% | 13.00% | |||
ASC 606 [Member] | Customer Three [Member] | Net Sales [Member] | Customer Concentration Risk [Member] | |||||
Revenue Recognition and Accounts Receivable [Abstract] | |||||
Concentration risk percentage | 12.00% |
Nature of Business and Basis _5
Nature of Business and Basis of Presentation, Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Loss per share [Abstract] | ||
Net deemed dividends resulting from subsequent reduction in exercise price of warrants | $ 33 | |
Potential shares of common stock that are not included in the calculation of diluted net loss per share [Abstract] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share (in shares) | 2,857,246 | 1,795,467 |
Reported net loss with reported net loss per share [Abstract] | ||
Net loss | $ (4,473) | $ (5,221) |
Deemed dividend to preferred shareholders (see Note 3) | 0 | (33) |
Net loss after deemed dividend | $ (4,473) | $ (5,254) |
Weighted average shares outstanding - basic (in shares) | 10,538,000 | 3,242,000 |
Weighted average shares outstanding - diluted (in shares) | 10,538,000 | 3,242,000 |
Basic loss per share (in dollars per share) | $ (0.42) | $ (1.62) |
Diluted loss per share (in dollars per share) | $ (0.42) | $ (1.62) |
Stock Options [Member] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share [Abstract] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share (in shares) | 1,174,748 | 140,471 |
Warrants to Purchase Common Stock [Member] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share [Abstract] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share (in shares) | 1,631,698 | 1,631,882 |
Series F Convertible Preferred Stock [Member] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share [Abstract] | ||
Potential shares of common stock that are not included in the calculation of diluted net loss per share (in shares) | 50,800 | 23,114 |
Revenue Recognition (Details)
Revenue Recognition (Details) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-04-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Abstract] | ||
Expected timing of satisfaction, period | 1 year | |
Sales Revenue [Member] | Customer Concentration Risk [Member] | ASC 606 [Member] | Maximum [Member] | ||
Revenue, Performance Obligation [Abstract] | ||
Percentage of net sales | 1.00% | 1.00% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | Sep. 17, 2021USD ($)$ / sharesshares | Mar. 19, 2021USD ($)$ / sharesshares | Oct. 09, 2020 | Oct. 06, 2020 | Mar. 12, 2019$ / shares | Nov. 27, 2017USD ($)$ / sharesshares | Mar. 31, 2022$ / sharesshares | Dec. 31, 2021shares | Mar. 23, 2020$ / shares | Jan. 28, 2020$ / shares | Nov. 06, 2019$ / shares | Oct. 25, 2019$ / shares | May 30, 2019$ / sharesshares | Jul. 03, 2018$ / shares |
Class of Stock Disclosures [Abstract] | ||||||||||||||
Net proceeds from issuance of convertible preferred stock | $ | $ 27,900,000 | |||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 0 | 0 | ||||||||||||
Reverse stock split | 0.03 | |||||||||||||
Minimum [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Reverse stock split | 0.2 | |||||||||||||
Maximum [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Reverse stock split | 0.03 | |||||||||||||
Expected Stock Price Volatility [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Warrants measurement input | 1.3621 | |||||||||||||
March 2021 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Issuance of common stock, net (in shares) | shares | 3,795,816 | |||||||||||||
Gross proceeds from public stock offering | $ | $ 20,900,000 | |||||||||||||
Net proceeds from public stock offering | $ | $ 18,900,000 | |||||||||||||
September 2021 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Issuance of common stock, net (in shares) | shares | 4,005,588 | |||||||||||||
Gross proceeds from public stock offering | $ | $ 10,000,000 | |||||||||||||
Net proceeds from public stock offering | $ | $ 9,000,000 | |||||||||||||
Warrants to Purchase Common Stock [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Number of warrants vested (in shares) | shares | 0 | |||||||||||||
Warrants to Purchase Common Stock [Member] | Consultant [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Warrants to purchase shares of common stock (in shares) | shares | 3,334 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 57.90 | $ 95.40 | ||||||||||||
Series F Convertible Preferred Stock [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Gross proceeds from issuance of convertible preferred stock | $ | $ 18,000,000 | |||||||||||||
Net proceeds from issuance of convertible preferred stock | $ | $ 16,200,000 | |||||||||||||
Conversion price (in dollars per share) | $ 1,890 | $ 890.40 | ||||||||||||
Number of consecutive trading days considered for expiration | 20 days | |||||||||||||
Number of consecutive trading days | 30 days | |||||||||||||
Preferred stock issued (in shares) | shares | 18,000 | 127 | 127 | |||||||||||
Number of shares issuable on conversion of preferred stock (in shares) | shares | 9,557 | |||||||||||||
Preferred stock, shares outstanding (in shares) | shares | 127 | 127 | ||||||||||||
Aggregate cash placement fee | 8.00% | |||||||||||||
Series F Convertible Preferred Stock [Member] | Minimum [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Percentage of volume weighted average price of common stock | 300.00% | |||||||||||||
Trading volume for each trading day | $ | $ 200,000 | |||||||||||||
Series F Convertible Preferred Stock [Member] | March 2019 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 157.50 | |||||||||||||
Series F Convertible Preferred Stock [Member] | October 2019 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 42.30 | |||||||||||||
Series F Convertible Preferred Stock [Member] | November 2019 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 29.83 | |||||||||||||
Series F Convertible Preferred Stock [Member] | January 2020 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 16.50 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 9 | |||||||||||||
Series F Convertible Preferred Stock [Member] | March 2020 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 9 | |||||||||||||
Series F Convertible Preferred Stock [Member] | March 2021 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 5.50 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 5.50 | |||||||||||||
Series F Convertible Preferred Stock [Member] | September 2021 Offering [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Conversion price (in dollars per share) | $ 2.50 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 2.50 | |||||||||||||
Series F Convertible Preferred Stock [Member] | Warrants to Purchase Common Stock [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Warrants to purchase shares of common stock (in shares) | shares | 19,122 | |||||||||||||
Series F Convertible Preferred Stock [Member] | Warrant Series 1 [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Warrants to purchase shares of common stock (in shares) | shares | 16 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 1,890 | |||||||||||||
Series F Convertible Preferred Stock [Member] | Warrant Series 2 [Member] | ||||||||||||||
Class of Stock Disclosures [Abstract] | ||||||||||||||
Warrants to purchase shares of common stock (in shares) | shares | 16 | |||||||||||||
Exercise price of warrants (in dollars per share) | $ 1,890 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stock-Based Compensation Expense Items [Abstract] | ||
Stock-based compensation expense | $ 241 | $ 355 |
Selling, General and Administrative Expense [Member] | ||
Stock-Based Compensation Expense Items [Abstract] | ||
Stock-based compensation expense | 214 | 327 |
Research and Development Expense [Member] | ||
Stock-Based Compensation Expense Items [Abstract] | ||
Stock-based compensation expense | $ 27 | $ 28 |
Operating Leases (Details)
Operating Leases (Details) | 3 Months Ended |
Mar. 31, 2022USD ($)$ / ft²ft² | |
Operating Lease s [Abstract] | |
Area of property leased under operating lease | ft² | 23,000 |
Monthly rent and common area maintenance charges | $ | $ 29,000 |
Annual base rent (per square foot) | 10.50 |
Minimum [Member] | |
Operating Lease s [Abstract] | |
Annual increase per square foot (in dollars per square foot) | 0.32 |
Maximum [Member] | |
Operating Lease s [Abstract] | |
Annual increase per square foot (in dollars per square foot) | 0.34 |
Finance Lease Liability (Detail
Finance Lease Liability (Details) | Dec. 31, 2020USD ($) |
Finance Lease Liability [Abstract] | |
Value of finance lease equipment | $ 98,000 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, Plant and Equipment, Net |
Principal amount under lease agreement | $ 93,000 |
Implied interest rate | 7.50% |
Finance lease term | 39 months |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Koronis Biomedical Corporation [Member] | Aug. 05, 2021USD ($)Installment | Mar. 31, 2022USD ($) |
Commitments and Contingencies [Abstract] | ||
Amount of grant approval received | $ 1,700,000 | |
Non-refundable technology license fee | $ 428,160 | |
Number of equal monthly installments | Installment | 12 | |
Research and Development Expense [Member] | ||
Commitments and Contingencies [Abstract] | ||
Non-refundable technology license fee expenses | $ 428,160 | |
Current Accounts Payable [Member] | ||
Commitments and Contingencies [Abstract] | ||
Non-refundable technology license fee | 356,800 | |
Other Long-term Liabilities [Member] | ||
Commitments and Contingencies [Abstract] | ||
Non-refundable technology license fee | $ 71,360 |