Helius Medical (HSDT) 10-Q 11 May 23 2023 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2023	May 03, 2023
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Amendment Flag	false
Document Period End Date	Mar. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Trading Symbol	HSDT
Entity Registrant Name	HELIUS MEDICAL TECHNOLOGIES, INC.
Entity Central Index Key	0001610853
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		28,215,394
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-38445
Entity Tax Identification Number	36-4787690
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	642 Newtown Yardley Road, Suite 100
Entity Address, City or Town	Newtown
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	18940
City Area Code	(215)
Local Phone Number	944-6100
Title of 12(b) Security	Class A Common Stock, $0.001 par value per share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 11,340	$ 14,549
Accounts receivable, net	11	71
Other receivables	156	272
Inventory, net	617	589
Prepaid expenses and other current assets	1,085	1,216
Total current assets	13,209	16,697
Property and equipment, net	354	347
Intangible assets, net	101	140
Operating lease right-of-use asset, net	91	103
Total assets	13,755	17,287
Current liabilities
Accounts payable	840	627
Accrued and other current liabilities	856	1,280
Operating lease liabilities	51	54
Deferred revenue	42	27
Total current liabilities	1,789	1,988
Operating lease liabilities	46	56
Deferred revenue	157	175
Derivative liability	5,696	6,917
Total liabilities	7,688	9,136
Commitments and contingencies (Note 9)
Stockholders' equity
Class A common stock, $0.001 par value; 150,000,000 shares authorized; 28,213,378 and 28,207,330 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively	28	28
Additional paid-in capital	160,023	159,618
Accumulated deficit	(153,601)	(151,107)
Accumulated other comprehensive loss	(383)	(388)
Total stockholders' equity	6,067	8,151
Total liabilities and stockholders' equity	$ 13,755	$ 17,287

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares, issued	28,213,378	28,207,330
Common stock, shares, outstanding	28,213,378	28,207,330

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Revenue
Product sales, net	$ 106	$ 183
Revenue from Contract with Customer, Product and Service [Extensible Enumeration]	us-gaap:ProductMember	us-gaap:ProductMember
Other revenue	$ 5	$ 7
Total revenue	111	190
Cost of revenue
Cost of revenue	$ 122	$ 124
Cost, Product and Service [Extensible Enumeration]	us-gaap:ProductMember	us-gaap:ProductMember
Gross profit (loss)	$ (11)	$ 66
Operating expenses
Selling, general and administrative expenses	2,874	2,819
Research and development expenses	886	1,764
Amortization expense	39	47
Total operating expenses	3,799	4,630
Loss from operations	(3,810)	(4,564)
Nonoperating income (expense)
Interest expense, net	100
Change in fair value of derivative liability	1,221
Foreign exchange (loss) gain	(5)	217
Other income (expense), net		1
Nonoperating income (expense), net	1,316	218
Loss before provision for income taxes	(2,494)	(4,346)
Provision for income taxes
Net loss	(2,494)	(4,346)
Other comprehensive income (loss)
Foreign currency translation adjustments	5	(202)
Comprehensive loss	$ (2,489)	$ (4,548)
Loss per share
Basic	$ (0.09)	$ (1.15)
Diluted	$ (0.09)	$ (1.15)
Weighted average number of common shares outstanding
Basic	28,209,346	3,787,871
Diluted	28,209,346	3,787,871

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock.	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss	Total
Beginning Balance at Dec. 31, 2021	$ 4	$ 149,412	$ (137,035)	$ (1,125)	$ 11,256
Beginning Balance, Shares at Dec. 31, 2021	3,780,674
Settlement of restricted stock units, Shares	1,584
Common stock issued for services		20			20
Common stock issued for services, Shares	4,528
Stock-based compensation		402			402
Stock-based compensation, Shares	8,011
Other comprehensive income (loss)				(202)	(202)
Net loss			(4,346)		(4,346)
Ending Balance at Mar. 31, 2022	$ 4	149,834	(141,381)	(1,327)	7,130
Ending Balance, Shares at Mar. 31, 2022	3,794,797
Beginning Balance at Dec. 31, 2022	$ 28	159,618	(151,107)	(388)	8,151
Beginning Balance, Shares at Dec. 31, 2022	28,207,330
Settlement of restricted stock units, Shares	6,048
Stock-based compensation		405			405
Other comprehensive income (loss)				5	5
Net loss			(2,494)		(2,494)
Ending Balance at Mar. 31, 2023	$ 28	$ 160,023	$ (153,601)	$ (383)	$ 6,067
Ending Balance, Shares at Mar. 31, 2023	28,213,378

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net loss	$ (2,494)	$ (4,346)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of derivative liability	(1,221)
Stock-based compensation expense	405	402
Common stock issued for services		20
Foreign exchange loss (gain)	5	(217)
Depreciation expense	12	25
Amortization expense	39	47
Non-cash operating lease expense	12	13
Changes in operating assets and liabilities:
Accounts receivable	60	7
Other receivables	116	4
Inventory, net	(28)	(45)
Prepaid expense and other current assets	131	(88)
Operating lease liability	(13)	(6)
Accounts payable	213	54
Accrued and other current liabilities	(424)	(425)
Deferred revenue	(3)	(127)
Net cash used in operating activities	(3,190)	(4,682)
Cash flows from investing activities:
Purchase of property and equipment	(19)	(2)
Proceeds from sale of property and equipment		6
Net cash (used in) provided by investing activities	(19)	4
Cash flows from financing activities:
Share issuance costs		(17)
Net cash used in financing activities		(17)
Net increase in cash and cash equivalents	(3,209)	(4,695)
Cash and cash equivalents at beginning of period	14,549	11,005
Cash and cash equivalents at end of period	$ 11,340	6,310
Non-cash investing and financing transactions:
Right-of-use assets obtained in exchange for new lease liabilities		$ 151

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2023
BASIS OF PRESENTATION
BASIS OF PRESENTATION	1. BASIS OF PRESENTATION The accompanying interim Unaudited Condensed Consolidated Financial Statements of Helius Medical Technologies, Inc. (together with its wholly owned subsidiaries the “Company”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 that was filed with the Securities and Exchange Commission on March 9, 2023 (“2022 10-K”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") have been condensed or omitted. There have been no material changes to the Company's significant accounting policies from those described in the 2022 10-K. Certain prior period amounts have been reclassified to conform to the current period presentation. On April 21, 2023, the Company filed a definitive proxy statement seeking stockholder approval for a reverse stock split of our outstanding Class A common stock at a ratio in the range of 1-for- 10 80 The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Going Concern Uncertainty As of March 31, 2023, the Company had cash and cash equivalents of $11.3 million. For the three months ended March 31, 2023, the Company had an operating loss of $3.8 million, and as of March 31, 2023, its accumulated deficit was $153.6 million. For the three months ended March 31, 2023, the Company had $0.1 million of net revenue from the commercial sale of products. The Company expects to continue to incur operating losses and net cash outflows until such time as it generates a level of revenue to support its cost structure. There is no assurance that the Company will achieve profitable operations, and, if achieved, whether it will be sustained on a continued basis. These factors indicate substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are filed. The Company’s Unaudited Condensed Consolidated Financial Statements have been prepared on the basis of continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business; no adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern. The Company intends to fund ongoing activities by utilizing its current cash and cash equivalents on hand, cash received from the sale of its PoNS device in the U.S. and Canada and by raising additional capital through equity or debt financings. There can be no assurance that the Company will be successful in raising additional capital or that such capital, if available, will be on terms that are acceptable to the Company. If the Company is unable to raise sufficient additional capital, the Company may be compelled to reduce the scope of its operations. Global Economic Conditions Generally, worldwide economic conditions remain uncertain, particularly due to the conflict between Russia and Ukraine, disruptions in the banking system and financial markets, lingering effects of the COVID-19 pandemic and increased inflation. The general economic and capital market conditions both in the United States and worldwide, have been volatile in the past and at times have adversely affected the Company’s access to capital and increased the cost of capital. The capital and credit markets may not be available to support future capital raising activity on favorable terms. If economic conditions decline, the Company’s future cost of equity or debt capital and access to the capital markets could be adversely affected. The COVID-19 pandemic that began in late 2019 introduced significant volatility to the global economy, disrupted supply chains and had a widespread adverse effect on the financial markets. Additionally, the Company’s operating results could be materially impacted by changes in the overall macroeconomic environment and other economic factors. Changes in economic conditions, supply chain constraints, logistics challenges, labor shortages, the conflict in Ukraine, disruptions in the banking system and financial markets, and steps taken by governments and central banks, particularly in response to the COVID-19 pandemic as well as other stimulus and spending programs, have led to high inflation, which has increased costs and has caused changes in fiscal and monetary policy, including an increase in interest rates. Although the Company may take measures to mitigate these impacts, if these measures are not effective, the Company’s business, financial condition, results of operations, and liquidity could be materially adversely affected. In the opinion of management, the interim unaudited condensed consolidated financial statements reflect all adjustments necessary for a fair statement of the results for the interim periods presented. All such adjustments, unless otherwise noted herein, are of a normal, recurring nature. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	3 Months Ended
	Mar. 31, 2023
Recent Accounting Pronouncements
Recent Accounting Pronouncements	2. RECENT ACCOUNTING PRONOUNCEMENTS In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update 2016 - Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , .

SUPPLEMENTAL BALANCE SHEET DISC

SUPPLEMENTAL BALANCE SHEET DISCLOSURES	3 Months Ended
	Mar. 31, 2023
Supplemental Balance Sheet Disclosures
SUPPLEMENTAL BALANCE SHEET DISCLOSURES	3. SUPPLEMENTAL BALANCE SHEET DISCLOSURES Components of selected captions in the unaudited condensed consolidated balance sheets consisted of the following: ​ Accounts receivable, net ​ Accounts receivable from product sales are net of allowance for credit losses of less than $1 thousand as of both March 31, 2023 and December 31, 2022. ​ Inventory, net (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 ​ 2022 Raw materials ​ $ 334 ​ $ 344 Work-in-process ​ 272 ​ 284 Finished goods ​ 75 ​ 39 Inventory, gross ​ ​ 681 ​ ​ 667 Inventory reserve ​ (64) ​ (78) Inventory, net ​ $ 617 ​ $ 589 ​ During the three months ended March 31, 2023, $14 thousand of inventory was written off to the inventory reserve. Prepaid expenses and other current assets (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 ​ 2022 Prepaid expenses ​ $ 687 ​ $ 817 Inventory related ​ 398 ​ 399 Total prepaid expenses and other current assets ​ $ 1,085 ​ $ 1,216 ​ Accrued and other current liabilities (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 2022 Insurance payable ​ $ 373 ​ $ 592 Employees benefits ​ ​ 331 ​ ​ 509 Professional services ​ 106 ​ 119 Other ​ 46 ​ 60 Total accrued and other current liabilities ​ $ 856 ​ $ 1,280 ​ Deferred revenue Exclusive Distribution Agreement Pursuant to an Exclusive Distribution Agreement with Health Tech Connex Inc. (“HTC”) (“Exclusivity Agreement”) entered into on March 3, 2023, subject to certain terms and conditions, the Company granted to HTC the exclusive right to provide PoNS Therapy in the Fraser Valley and Vancouver metro regions of British Columbia. HTC will purchase the PoNS devices for use in these regions exclusively from the Company and on terms no less favorable than the then-current standard terms and conditions. This Exclusivity Agreement replaced the previous Clinical Research and Co-Promotion Agreement (“Co-Promotion Agreement”) between the parties entered into in October 2019 that included a similar exclusive right provision. The exclusive right under the Exclusivity Agreement was granted for a value of CAD$273 thousand, which is represented by the unamortized up-front payment under the former Co-Promotion Agreement. The initial term of the Exclusivity Agreement expires on December 31, 2027, and is renewable by HTC for one additional five-year term upon sixty days’ written notice to the Company. Deferred revenue as of both March 31, 2023 and December 31, 2022 is comprised of the remaining unamortized amount under these agreements. Revenue recognized is included in other revenue in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

LEASES

LEASES	3 Months Ended
	Mar. 31, 2023
LEASES
LEASES	4. LEASES The Company has two operating leases for office space with lease terms expiring in January 2024 and March 2025. The leases do not contain any options to extend Maturities of operating lease liabilities as of March 31, 2023 were as follows (in thousands): ​ ​ ​ ​ 2023 (remaining) ​ $ 43 2024 ​ ​ 46 2025 ​ ​ 12 Total lease payments ​ 101 Less: imputed interest ​ (4) Total lease liabilities ​ $ 97 ​ ​

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	3 Months Ended
	Mar. 31, 2023
Fair Value Measurements
Fair Value Measurements	5. FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Fair value of an asset or liability considers assumptions that market participants would use in pricing the asset or liability, including consideration of non-performance risk. The inputs used to determine fair values are categorized in one of the following three levels of the fair value hierarchy: Level 1 – Quoted market prices in active markets for identical assets or liabilities. Level 2 – Inputs, other than quoted prices in active markets, that are observable, either directly or indirectly. Level 3 – Unobservable inputs that are not corroborated by market data. The Unaudited Condensed Consolidated Financial Statements include financial instruments for which the fair market value of such instruments may differ from amounts reflected on a historical cost basis. Financial instruments of the Company consist of cash equivalents, which were comprised of deposits of excess cash in an unrestricted money market savings account and a certificate of deposit as of both March 31, 2023 and December 31, 2022. The carrying value of cash equivalents generally approximates fair value due to their short-term nature. The Company’s derivative liability as of March 31, 2023 and December 31, 2022 is comprised of warrants issued in connection with the registered public offering completed in August 2022 (“August 2022 Public Offering”) discussed in Note 6. The derivative liability is classified as Level 3 within the fair value hierarchy and is required to be recorded at fair value on a recurring basis. See Note 6 for further information on the fair value of the derivative liability. ​

COMMON STOCK, PREFERRED STOCK A

COMMON STOCK, PREFERRED STOCK AND WARRANTS	3 Months Ended
	Mar. 31, 2023
COMMON STOCK, PREFERRED STOCK AND WARRANTS
COMMON STOCK, PREFERRED STOCK AND WARRANTS	6. COMMON STOCK, PREFERRED STOCK AND WARRANTS Series B Preferred Stock On March 23, 2023, the Board of Directors declared a dividend of one one The outstanding shares of Series B Preferred Stock will vote together with the outstanding shares of the Company’s Class A common stock, as a single class, exclusively with respect to a proposal giving the Board of Directors the authority, as it determines appropriate, to implement a reverse stock split within twelve months following the approval of such proposal by the Company’s stockholders (the “Reverse Stock Split Proposal”), as well as any proposal to adjourn any meeting of stockholders called for the purpose of voting on the foregoing matters (the “Adjournment Proposal”). No shares of Series B Preferred Stock may be transferred by the holder except in connection with a transfer by such holder of any shares of Class A common stock held by such holder. Each share of Series B Preferred Stock will entitle the holder to 1,000,000 votes per share and each fraction of a share of Series B Preferred Stock will have a ratable number of votes. The holder of Series B Preferred Stock, as such, will not be entitled to receive dividends. All shares of Series B Preferred Stock that are not present in person or by proxy at any meeting of stockholders held to vote on the Reverse Stock Split Proposal and the Adjournment Proposal as of immediately prior to the opening of the polls at such meeting (the “Initial Redemption Time”) will automatically be redeemed in whole, but not in part, by the Company at the Initial Redemption Time without further action on the part of the Company or the holder of shares of Series B Preferred Stock (the “Initial Redemption”). The Series B Preferred Stock is not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company. The Series B Preferred Stock has no stated maturity and is not subject to any sinking fund. The Series B Preferred Stock is not subject to any restriction on the redemption or repurchase of shares by the Company while there is any arrearage in the payment of dividends or sinking fund installments. The Certificate of Designation was filed with the Delaware Secretary of State and became effective on March 24, 2023. Warrants The Company issued warrants to purchase an aggregate of 36,000,000 shares of Class A common stock (“Public Warrants”) in connection with the August 2022 Public Offering, as more fully described in the 2022 10-K. The Public Warrants did not meet the guidance for being classified as an equity instrument due to a potential price reset prompted by a change in an unrelated instrument’s conversion rate or, in the event of a fundamental transaction, settlement rights that differ from those of the underlying common stockholders. Accordingly, the Public Warrants are being accounted for as a derivative liability instrument. The fair value of the derivative liability as of March 31, 2023 and December 31, 2022 was $5.7 million and $6.9 million, respectively. The change in the fair value of the derivative liability was recognized as a component of nonoperating income (expense) in the Company’s Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The fair value of the Public Warrants as of March 31, 2023 and December 31, 2022 was determined using both a Monte Carlo simulation model, which uses multiple input variables to determine the probability of the occurrence of a price reset or a fundamental transaction and the Black-Scholes option pricing model. The following table includes the share price and the inputs used to estimate the fair value of the warrants: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2023 ​ 2022 Stock price ​ $ 0.25 ​ $ 0.31 ​ Warrant term (in years) ​ 4.36 ​ 4.61 ​ Expected volatility ​ 83.70 % 80.90 % Risk-free interest rate ​ 3.67 % 4.04 % Dividend rate ​ 0.00 % 0.00 % ​ The 36,000,000 of outstanding liability classified Public Warrants have an exercise price of $0.75 per share, are exercisable upon issuance and will expire five years following the date of issuance. No Public Warrants were exercised or cancelled The Company has outstanding equity-classified warrants to purchase 593,924 shares of Class A common stock at a weighted average exercise price of $16.32, with expiration dates ranging from October 2023 to February 2026. During the three months ended March 31, 2023, no warrants were exercised

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	3 Months Ended
	Mar. 31, 2023
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION	7. STOCK-BASED COMPENSATION The Company may issue stock-based compensation awards under The Helius Medical Technologies, Inc. 2022 Equity Incentive Plan (“2022 Plan”) or the Helius Medical Technologies, Inc. 2021 Inducement Plan (as amended, the “Inducement Plan”), as described more fully in the 2022 10-K. On January 1, 2023, pursuant to the automatic increase provision of the 2022 Plan, the number of shares authorized for issuance increased from the initial 1,121,272 to 13,215,973 . As of March 31, 2023, the remaining shares available for grant were 2,195,103 under the 2022 Plan and 474,375 under the Inducement Plan. During the three months ended March 31, 2023, the Company granted 9,949,000 stock options out of the 2022 Plan at a weighted average exercise price of $0.31 per share. The options vest over three years and expire ten years after the grant date. As of March 31, 2023, there were an aggregate of 11,122,299 stock options outstanding with a weighted average exercise price of $1.70 per share and 2,016 unvested restricted stock units outstanding with a weighted average grant date fair value of $1.40 per share. ​ ​ The following table includes the weighted-average assumptions used in the Black-Scholes option pricing model and the related weighted-average grant-date fair values of stock options granted during the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, ​ 2023 2022 ​ Risk-free interest rate ​ 3.95 % ​ 1.95 % Expected volatility ​ 79.47 % 73.53 % Expected term (years) ​ 5.75 ​ 5.75 ​ Expected dividend yield ​ ​ 0.00 % 0.00 % Fair value, per share ​ $ 0.22 ​ $ 3.01 ​ ​ ​ Total stock-based compensation expense was as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 ​ 2022 Cost of sales ​ $ 4 ​ $ 3 Selling, general and administrative ​ 320 ​ 246 Research and development ​ ​ 81 ​ ​ 153 Total stock-based compensation expense ​ $ 405 ​ $ 402 ​ As of March 31, 2023, the total remaining unrecognized compensation expense related to nonvested stock options and restricted stock units was $3.6 million which will be amortized over the weighted-average remaining requisite service period of 2.7 years.

BASIC AND DILUTED LOSS PER SHAR

BASIC AND DILUTED LOSS PER SHARE	3 Months Ended
	Mar. 31, 2023
BASIC AND DILUTED LOSS PER SHARE
BASIC AND DILUTED LOSS PER SHARE	8. BASIC AND DILUTED LOSS PER SHARE The table below presents the computation of basic and diluted loss per share (in thousands, except share and per share information): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 2022 Basic: ​ ​ ​ Net loss available to common stockholders - basic ​ $ (2,494) ​ $ (4,346) Weighted average common shares outstanding - basic ​ 28,209,346 ​ 3,787,871 Loss per share - basic ​ $ (0.09) ​ $ (1.15) ​ ​ ​ ​ Diluted: ​ ​ ​ Net loss available to common stockholders - diluted (1) ​ $ (2,494) ​ $ (4,346) Weighted average common shares outstanding - diluted (1) ​ 28,209,346 ​ 3,787,871 Loss per share - diluted ​ $ (0.09) ​ $ (1.15) ​ (1) For the three months ended March 31, 2023, no adjustment was made to the numerator and no incremental shares were added to the denominator for the Public Warrants being accounted for as a derivative liability, as the Public Warrants were out-of-the-money during the period. Refer to Note 6 for additional information about the Public Warrants. The following outstanding securities, presented based on amounts outstanding as of the end of each period, were not included in the computation of diluted net loss per share for the periods indicated, as they would have been anti-dilutive due to the net loss in each period. ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 2022 Stock options ​ 11,122,299 ​ 785,228 Restricted stock units ​ 2,016 ​ 775 Warrants ​ 36,593,924 ​ 593,924 ​

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2023
COMMITMENTS AND CONTINGENCIES.
Commitments and Contingencies	9. COMMITMENTS AND CONTINGENCIES The Company is obligated under a license agreement with Advanced NeuroRehabilitation, LLC (“ANR”) to pay a 4% royalty on net revenue collected from the sale of devices covered by the patent-pending technology. During the three months ended March 31, 2023 and 2022, the Company recorded royalty expense from the sale of devices of approximately $4 thousand and $7 thousand, respectively, in its Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

ENTERPRISE-WIDE DISCLOSURES

ENTERPRISE-WIDE DISCLOSURES	3 Months Ended
	Mar. 31, 2023
ENTERPRISE-WIDE DISCLOSURES
ENTERPRISE-WIDE DISCLOSURES	10. ENTERPRISE-WIDE DISCLOSURES Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. Our CODM is the Chief Executive Officer. The Company operates and manages its business within one operating and reportable The following table presents the Company’s revenue disaggregated by geographic area (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ 2023 ​ 2022 Product sales, net: ​ ​ ​ ​ ​ ​ United States ​ $ 75 ​ $ — Canada ​ ​ 31 ​ ​ 183 Total product sales, net ​ ​ 106 ​ ​ 183 Other revenue ​ 5 ​ 7 Total revenue ​ $ 111 ​ $ 190 ​ A single customer accounted for 14% of net product sales for the three months ended March 31, 2023 and 67% of accounts receivable, net as of March 31, 2023. A single customer accounted for 68% of net product sales for the three months ended March 31, 2022 and 89% of accounts receivable, net as of December 31, 2022.

SUPPLEMENTAL BALANCE SHEET DI_2

SUPPLEMENTAL BALANCE SHEET DISCLOSURES (Tables)	3 Months Ended
	Mar. 31, 2023
Supplemental Balance Sheet Disclosures
Schedule of Inventory, net	​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 ​ 2022 Raw materials ​ $ 334 ​ $ 344 Work-in-process ​ 272 ​ 284 Finished goods ​ 75 ​ 39 Inventory, gross ​ ​ 681 ​ ​ 667 Inventory reserve ​ (64) ​ (78) Inventory, net ​ $ 617 ​ $ 589 ​
Schedule of prepaid expenses and other current assets	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 ​ 2022 Prepaid expenses ​ $ 687 ​ $ 817 Inventory related ​ 398 ​ 399 Total prepaid expenses and other current assets ​ $ 1,085 ​ $ 1,216
Schedule of accrued and other current liabilities	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, December 31, ​ 2023 2022 Insurance payable ​ $ 373 ​ $ 592 Employees benefits ​ ​ 331 ​ ​ 509 Professional services ​ 106 ​ 119 Other ​ 46 ​ 60 Total accrued and other current liabilities ​ $ 856 ​ $ 1,280 ​

LEASES (Tables)

LEASES (Tables)	3 Months Ended
	Mar. 31, 2023
LEASES
Schedule of maturities of operating lease liabilities and related weighted average lease term and discount rate	Maturities of operating lease liabilities as of March 31, 2023 were as follows (in thousands): ​ ​ ​ ​ 2023 (remaining) ​ $ 43 2024 ​ ​ 46 2025 ​ ​ 12 Total lease payments ​ 101 Less: imputed interest ​ (4) Total lease liabilities ​ $ 97 ​

COMMON STOCK, PREFERRED STOCK_2

COMMON STOCK, PREFERRED STOCK AND WARRANTS (Tables)	3 Months Ended
	Mar. 31, 2023
COMMON STOCK, PREFERRED STOCK AND WARRANTS
Schedule of assumptions used in estimating fair value	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, ​ 2023 ​ 2022 Stock price ​ $ 0.25 ​ $ 0.31 ​ Warrant term (in years) ​ 4.36 ​ 4.61 ​ Expected volatility ​ 83.70 % 80.90 % Risk-free interest rate ​ 3.67 % 4.04 % Dividend rate ​ 0.00 % 0.00 %

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	3 Months Ended
	Mar. 31, 2023
STOCK-BASED COMPENSATION
Schedule of weighted-average assumptions used in Black-Scholes option pricing model	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, ​ 2023 2022 ​ Risk-free interest rate ​ 3.95 % ​ 1.95 % Expected volatility ​ 79.47 % 73.53 % Expected term (years) ​ 5.75 ​ 5.75 ​ Expected dividend yield ​ ​ 0.00 % 0.00 % Fair value, per share ​ $ 0.22 ​ $ 3.01 ​ ​
Schedule of stock-based compensation expense	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 ​ 2022 Cost of sales ​ $ 4 ​ $ 3 Selling, general and administrative ​ 320 ​ 246 Research and development ​ ​ 81 ​ ​ 153 Total stock-based compensation expense ​ $ 405 ​ $ 402

BASIC AND DILUTED LOSS PER SH_2

BASIC AND DILUTED LOSS PER SHARE (Tables)	3 Months Ended
	Mar. 31, 2023
BASIC AND DILUTED LOSS PER SHARE
Schedule of computation of basic and diluted loss per share	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 2022 Basic: ​ ​ ​ Net loss available to common stockholders - basic ​ $ (2,494) ​ $ (4,346) Weighted average common shares outstanding - basic ​ 28,209,346 ​ 3,787,871 Loss per share - basic ​ $ (0.09) ​ $ (1.15) ​ ​ ​ ​ Diluted: ​ ​ ​ Net loss available to common stockholders - diluted (1) ​ $ (2,494) ​ $ (4,346) Weighted average common shares outstanding - diluted (1) ​ 28,209,346 ​ 3,787,871 Loss per share - diluted ​ $ (0.09) ​ $ (1.15) ​ (1) For the three months ended March 31, 2023, no adjustment was made to the numerator and no incremental shares were added to the denominator for the Public Warrants being accounted for as a derivative liability, as the Public Warrants were out-of-the-money during the period. Refer to Note 6 for additional information about the Public Warrants.
Schedule of anti-dilutive securities	​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, ​ ​ 2023 2022 Stock options ​ 11,122,299 ​ 785,228 Restricted stock units ​ 2,016 ​ 775 Warrants ​ 36,593,924 ​ 593,924

ENTERPRISE-WIDE DISCLOSURES (Ta

ENTERPRISE-WIDE DISCLOSURES (Tables)	3 Months Ended
	Mar. 31, 2023
ENTERPRISE-WIDE DISCLOSURES
Schedule of revenue disaggregated by geographic area	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ ​ 2023 ​ 2022 Product sales, net: ​ ​ ​ ​ ​ ​ United States ​ $ 75 ​ $ — Canada ​ ​ 31 ​ ​ 183 Total product sales, net ​ ​ 106 ​ ​ 183 Other revenue ​ 5 ​ 7 Total revenue ​ $ 111 ​ $ 190

BASIS OF PRESENTATION (Details)

BASIS OF PRESENTATION (Details) $ in Thousands		3 Months Ended
	Apr. 21, 2023	Mar. 31, 2023 USD ($)	Mar. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)
Cash and cash equivalents		$ 11,340		$ 14,549
Operating loss		3,810	$ 4,564
Accumulated deficit		153,601		$ 151,107
Product sales, net		$ 106	$ 183
Class A Common Stock | Minimum
Reverse stock split	0.10
Class A Common Stock | Maximum
Reverse stock split	0.0125

SUPPLEMENTAL BALANCE SHEET DI_3

SUPPLEMENTAL BALANCE SHEET DISCLOSURES - Accounts receivable, net (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Maximum
Accounts receivable, net
Allowance for credit losses	$ 1	$ 1

SUPPLEMENTAL BALANCE SHEET DI_4

SUPPLEMENTAL BALANCE SHEET DISCLOSURES - Inventory (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Inventory
Raw materials	$ 334	$ 344
Work-in-process	272	284
Finished goods	75	39
Inventory	681	667
Inventory reserve	(64)	(78)
Total inventory, net of reserve	617	$ 589
Work-in-process inventory written off to inventory reserve	$ 14

SUPPLEMENTAL BALANCE SHEET DI_5

SUPPLEMENTAL BALANCE SHEET DISCLOSURES - Prepaid expenses and other current assets (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Supplemental Balance Sheet Disclosures
Prepaid expenses	$ 687	$ 817
Inventory related	398	399
Total prepaid expenses and other current assets	$ 1,085	$ 1,216

SUPPLEMENTAL BALANCE SHEET DI_6

SUPPLEMENTAL BALANCE SHEET DISCLOSURES - Accrued and other current liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accrued and other current liabilities
Insurance payable	$ 373	$ 592
Employees benefits	331	509
Professional services	106	119
Other	46	60
Total accrued and other current liabilities	$ 856	$ 1,280

SUPPLEMENTAL BALANCE SHEET DI_7

SUPPLEMENTAL BALANCE SHEET DISCLOSURES - Deferred Revenue (Details) - HTC - Exclusivity Agreement $ in Thousands	Mar. 03, 2023 CAD ($) item
Deferred Revenue
Value of exclusivity right granted | $	$ 273
Number of additional terms | item	1
Additional term	5 years
Period for written notice for renewal	60 days

LEASES (Details)

LEASES (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($) lease	Mar. 31, 2022 USD ($)
LEASES
Number of operating leases | lease	2
Lessee options to extend lease	false
Operating lease costs	$ 14	$ 15
Maturities of operating lease liabilities
2023 (remaining)	43
2024	46
2025	12
Total lease payments	101
Less: imputed interest	(4)
Total lease liabilities	$ 97

COMMON STOCK, PREFERRED STOCK_3

COMMON STOCK, PREFERRED STOCK AND WARRANTS - Series B Preferred Stock and Public Warrants (Details)	Mar. 23, 2023 USD ($) Vote	Mar. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Aug. 09, 2022 shares
Common stock, preferred stock and warrants
Dividend declared in shares of Series B Preferred Stock for each outstanding share of Class A common stock	0.001
Fair value of derivative liability		$ 5,696,000	$ 6,917,000
Public Warrants
Common stock, preferred stock and warrants
Shares of common stock purchasable with warrants | shares				36,000,000
Series B Preferred Stock
Common stock, preferred stock and warrants
Number of voting rights per share of preferred stock each holder is entitled to | Vote	1,000,000

COMMON STOCK, PREFERRED STOCK_4

COMMON STOCK, PREFERRED STOCK AND WARRANTS - Warrant Fair Value Inputs (Details)	Mar. 31, 2023	Dec. 31, 2022
Stock price
Fari value inputs
Derivative Liability, Measurement Input	0.25	0.31
Warrant Term
Fari value inputs
Derivative Liability, Measurement Input	0	4.61
Expected Volatility
Fari value inputs
Derivative Liability, Measurement Input	0.8370	0.8090
Risk-Free Interest Rate
Fari value inputs
Derivative Liability, Measurement Input	0.0367	0.0404
Dividend Rate
Fari value inputs
Derivative Liability, Measurement Input	0	0

COMMON STOCK, PREFERRED STOCK_5

COMMON STOCK, PREFERRED STOCK AND WARRANTS - Warrant Activity (Details)	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Public Warrants
Warrant activity
Number of warrants outstanding	36,000,000
Exercise price | $ / shares	$ 0.75
Warrant expiration period	5 years
Number of warrants exercised	0
Number of warrants cancelled	0
Equity-classified Warrants
Warrant activity
Number of warrants outstanding	593,924
Number of warrants exercised	0
Number of warrants cancelled	0
Equity-classified Warrants | Weighted Average
Warrant activity
Exercise price | $ / shares	$ 16.32

STOCK-BASED COMPENSATION - Plan

STOCK-BASED COMPENSATION - Plan Information- (Details) - shares	3 Months Ended
	Mar. 31, 2023	Jan. 01, 2023	Dec. 31, 2022
2022 Plan
Stock-Based Compensation
Shares authorized for issuance	13,215,973	13,215,973	1,121,272
Shares of common stock available for issuance	2,195,103
2022 Plan | Stock options
Stock-Based Compensation
Vesting period	3 years
Expiration period	10 years
Inducement Plan
Stock-Based Compensation
Shares of common stock available for issuance	474,375

STOCK-BASED COMPENSATION - Awar

STOCK-BASED COMPENSATION - Awards Granted and Outstanding (Details)	3 Months Ended
	Mar. 31, 2023 $ / shares shares
Stock options
Stock-Based Compensation
Outstanding stock options (in shares) | shares	11,122,299
Outstanding (in dollars per share) | $ / shares	$ 1.70
Restricted Stock Units
Stock-Based Compensation
Outstanding unvested RSU (in shares) | shares	2,016
Weighted average grant date fair value (in dollars per share) | $ / shares	$ 1.40
2022 Plan | Stock options
Stock-Based Compensation
Granted (in shares) | shares	9,949,000
Granted (in dollars per share) | $ / shares	$ 0.31
Vesting period	3 years
Expiration period	10 years

STOCK-BASED COMPENSATION - Fair

STOCK-BASED COMPENSATION - Fair Value Assumptions (Details) - Stock options - $ / shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stock-Based Compensation
Risk-free interest rate	3.95%	1.95%
Expected volatility	79.47%	73.53%
Expected term	5 years 9 months	5 years 9 months
Expected dividend yield	0%	0%
Fair value, per share	$ 0.22	$ 3.01

STOCK-BASED COMPENSATION - Stoc

STOCK-BASED COMPENSATION - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Stock-Based Compensation
Stock based compensation expense	$ 405	$ 402
Remaining unrecognized compensation expense related to nonvested awards	$ 3,600
Weighted-average remaining requisite service period	2 years 8 months 12 days
Cost of sales
Stock-Based Compensation
Stock based compensation expense	$ 4	3
Selling, general and administrative
Stock-Based Compensation
Stock based compensation expense	320	246
Research and development
Stock-Based Compensation
Stock based compensation expense	$ 81	$ 153

BASIC AND DILUTED LOSS PER SH_3

BASIC AND DILUTED LOSS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Basic:
Net loss available to common stockholders - basic	$ (2,494)	$ (4,346)
Weighted average basic shares outstanding - basic	28,209,346	3,787,871
Loss per share - basic	$ (0.09)	$ (1.15)
Diluted:
Net loss available to common stockholders - diluted	$ (2,494)	$ (4,346)
Weighted average common shares outstanding - diluted	28,209,346	3,787,871
Loss per share - diluted	$ (0.09)	$ (1.15)

BASIC AND DILUTED LOSS PER SH_4

BASIC AND DILUTED LOSS PER SHARE - Antidilutive Securities (Details) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Share-Based Payment Arrangement, Option [Member]
Anti-dilutive securities
Anti-dilutive outstanding securities not included in computation of diluted loss per share	11,122,299	785,228
Restricted Stock Units
Anti-dilutive securities
Anti-dilutive outstanding securities not included in computation of diluted loss per share	2,016	775
Warrant [Member]
Anti-dilutive securities
Anti-dilutive outstanding securities not included in computation of diluted loss per share	36,593,924	593,924

COMMITMENTS AND CONTINGENCIES -

COMMITMENTS AND CONTINGENCIES - License Agreement (Details) - Advanced NeuroRehabilitation, LLC - License Agreement for Exclusive Right on Patent Pending Technology - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Commitments and Contingencies
Percentage of royalty on net revenue	4%
Royalty expense	$ 4	$ 7

ENTERPRISE-WIDE DISCLOSURES (De

ENTERPRISE-WIDE DISCLOSURES (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2023 USD ($) segment	Mar. 31, 2022 USD ($)	Dec. 31, 2022
Revenue disaggregated by geographic area
Number of operating segments | segment	1
Number of reportable segments | segment	1
Product sales, net	$ 106	$ 183
Other revenue	5	7
Total revenue	$ 111	$ 190
Net product sales | Customer | Single customer
Revenue disaggregated by geographic area
Concentration of risk (percent)	14%	68%
Accounts receivable, net | Credit | Single customer
Revenue disaggregated by geographic area
Concentration of risk (percent)	67%		89%
U.S.
Revenue disaggregated by geographic area
Product sales, net	$ 75
Canada
Revenue disaggregated by geographic area
Product sales, net	$ 31	$ 183