UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

OR

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to ___________________

Commission file number: 001-38325

enVVeno Medical Corporation

(Exact name of registrant as specified in its charter)

70 Doppler

Irvine, California 92618

(Address of principal executive offices)

(949) 261-2900

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of October 28, 2024, there were 17,536,000 shares of common stock outstanding.

ENVVENO MEDICAL CORPORATION

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

ITEM 1 – Financial Statements

ENVVENO MEDICAL CORPORATION

CONDENSED BALANCE SHEETS

(Unaudited)

See Notes to these Unaudited Condensed Financial Statements

ENVVENO MEDICAL CORPORATION

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

See Notes to these Unaudited Condensed Financial Statements

ENVVENO MEDICAL CORPORATION

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands, unless otherwise indicated)

(Unaudited)

See Notes to these Unaudited Condensed Financial Statements

ENVVENO MEDICAL CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS

(In thousands, unless otherwise indicated)

(Unaudited)

See Notes to these Unaudited Condensed Financial Statements

ENVVENO MEDICAL CORPORATION

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Item 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our unaudited condensed financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward-looking statements in the following discussion and elsewhere in this Quarterly Report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Such forward-looking statements involve significant risks and uncertainties. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on our behalf. Words such as “anticipate,” “estimate,” “plan,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions are used to identify forward-looking statements. Such forward-looking statements also involve other factors which may cause our actual results, performance or achievements to materially differ from any future results, performance, or achievements expressed or implied by such forward-looking statements and to vary significantly from reporting period to reporting period. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual future results will not be different from the expectations expressed in this Quarterly Report. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Unless the context requires otherwise, references in this document to “NVNO”, “we”, “our”, “us” or the “Company” are to enVVeno Medical Corporation.

Overview

enVVeno Medical Corporation is a late clinical-stage medical device company focused on the advancement of innovative bioprosthetic (tissue-based) solutions to improve the standard of care for the treatment of venous disease. Chronic Venous Disease (“CVD”) is the world’s most prevalent chronic disease, impacting approximately 70% of the adult population of the U.S. Chronic Venous Insufficiency (“CVI”), is a large subset of CVD, which most often occurs when valves inside of the veins of the leg become damaged, resulting in the backwards flow of blood (reflux), blood pooling in the lower leg, increased pressure in the veins of the leg (venous hypertension) and in severe cases, venous ulcers that are difficult to heal. The Company is developing surgical and non-surgical replacement venous valves for patients suffering from severe CVI of the deep venous system of the leg.

The Company’s lead product is the VenoValve®, which is a potential first-in-class surgical replacement venous valve that is currently being evaluated in a U.S. pivotal study called the SAVVE trial (Surgical Anti-reflux Venous Valve Endoprosthesis). Definitive one year data from SAVVE is expected to be released in the fourth quarter of 2024.

The Company is also developing the next generation replacement venous valve called enVVe®, which will be delivered via transcatheter as opposed to an open surgery. The Company is conducting pre-clinical testing on enVVe and currently expects to be ready to file for IDE approval for the enVVe pivotal trial in mid 2025.

Both the VenoValve and enVVe are designed to act as one-way valves, to help assist in propelling blood up the veins of the leg, and back to the heart and lungs.

The VenoValve and enVVe are being developed first for approval by the U.S. Food and Drug Administration (“FDA”). We expect to be eligible to file for FDA approval of the VenoValve in the fourth quarter of 2024 followed approximately three years later by enVVe. If approved, we expect the VenoValve and enVVe to co-exist, with the VenoValve as a surgical replacement venous valve option and enVVe as a non-surgical replacement venous valve option, although we cannot provide any assurance that either the VenoValve or enVVe will receive approval from the FDA. There are currently no devices approved as surgical or non-surgical replacement venous valves, and there are currently no effective treatments for deep venous CVI caused by incompetent valves.

Our team of officers and directors has been affiliated with numerous medical devices that have received FDA approval or CE marking and that have been commercially successful. We develop and manufacture both the VenoValve and EnVVe in a 14,000 sq. ft. leased manufacturing facility in Irvine, California, which has been ISO 13485-2016 certified for the design, development and manufacturing of tissue based implantable medical devices.

CVI Background

Chronic venous disease (CVD) is the world’s most prevalent chronic disease. CVD is clinically classified using a standardized system known as CEAP (clinical, etiological, anatomical, and pathophysiological). The CEAP system consists of seven clinical classifications (C0 to C6) with C4, C5 and C6 being the most severe categories of CVD.

Chronic Venous Insufficiency (CVI) is a large subset of CVD and is generally used to describe patients with C4 to C6 CVD. CVI is a debilitating condition that affects the venous system of the leg causing pain, swelling, edema, skin changes, and ulcerations.

The human leg contains three vein systems: the deep vein system, the superficial vein system, and the perforator vein system which connects the deep system to the superficial system. The deep venous system is located below the muscle and facia in the center portion of the leg and is responsible for approximately 90% of the blood flow. In order for blood to return to the heart from the foot, ankle, and lower leg, the calf muscle serves as a pump and pushes the blood up the veins of the leg against gravity and through a series of one-way valves. Each valve is supposed to open as blood passes through, and then close as blood progresses up the veins of the leg to the next valve. CVI occurs when the one-way valves in the veins of the leg fail and become incompetent. When the valves fail, gravity causes the blood to flow backwards and in the wrong direction (reflux). As blood pools in the lower leg, pressure inside the veins increases (venous hypertension). Reflux, and the resulting venous hypertension, causes the leg to swell, resulting in debilitating pain, and in the most severe cases, venous ulcers.

Severe CVI sufferers experience a significantly reduced quality of life. Daily activities such as preparing meals, housework, dressing, and personal hygiene (washing and bathing) become difficult due to reduced mobility. For many severe CVI sufferers, intense pain, which frequently occurs at night, prevents them from getting adequate sleep. Severe CVI sufferers are known to miss approximately 40% more workdays than the average worker. A high percentage of venous ulcer patients also experience severe itching, leg swelling, and an odorous discharge. Wound dressing changes, which occur several times a week, can be extremely painful. Venous ulcers from deep venous CVI are very difficult to heal, and a significant percentage of venous ulcers remain unhealed for more than a year. Even if healed, recurrence rates for venous ulcers are known to be high (20% to 40%) within the first year and as high as 60% after five years. Patients with severe CVI often become housebound and experience social isolation due to difficulty with ambulation. As a result, studies have shown that patients with active venous ulcers experience higher rates of anxiety and depression, with reported rates of anxiety of up to 30% and depression up to 40%. Rates of depression caused by venous ulcers among the elderly are even higher, with 48% of elderly venous ulcer patients having severe depressive symptoms.

Prevalence is generally defined as the portion of the population that has a given condition. Estimates indicate that the prevalence of people in the U.S. with severe, deep venous CVI (C4 to C6 disease) with reflux to be approximately 20 million. Incidence is generally defined as the number of new cases of an ailment that develop in a given time period. We estimate that approximately 3.5 million new patients with severe deep venous CVI are diagnosed each year in the U.S. including patients that develop venous leg ulcers (C6 patients). The average patient seeking treatment of a venous ulcer spends as much as $30,000 a year on wound care, and the total direct medical costs from venous ulcer sufferers in the U.S. has been estimated to exceed $3 billion a year.

VenoValve

The VenoValve is a replacement venous valve developed at enVVeno Medical to be surgically implanted in the deep venous system of the leg to treat severe CVI caused by valvular incompetence. By lowering pressure (venous hypertension) within the deep venous system of the leg, the VenoValve has the potential to reduce or eliminate the symptoms of severe deep venous CVI, including the potential to heal recurring venous leg ulcers. The VenoValve is implanted into the femoral vein of the patient in an open surgical procedure via a 5-to-6-inch incision in the upper thigh. As our planned initial entrant to the replacement venous valve market, we estimate that approximately 2.5 million people each year with severe deep venous CVI in the U.S. would be candidates for the VenoValve. The VenoValve has been granted Breakthrough Device designation by the FDA.

VenoValve Clinical Status

In March of 2021 we received IDE approval from the FDA to begin the VenoValve pivotal study. An investigational device exemption or IDE from the FDA is required before a medical device company can proceed with a pivotal trial for a Class III medical device. This approval allowed us to proceed with our U.S. pivotal study for the VenoValve which is called the SAVVE (Surgical Anti-reflux Venous Valve Endoprosthesis) clinical study. The SAVVE study is a prospective, non-blinded, single arm, multi-center study of seventy-five (75) CVI patients enrolled at 21 U.S. sites.

Efficacy endpoints for the SAVVE pivotal study include rVCSS scores, which are used to provide evidence of clinically meaningful benefit, as well as reflux time measurements, VAS pain scores, quality of life measurements, ulcer healing (for CEAP class C6 patients), and intra-operative and one-year vein patency and valve functionality. Safety endpoints include device related events and procedure related events including mortality, pulmonary embolism, ipsilateral deep vein thrombosis, infection and bleeding.

We achieved full enrollment of 75 subjects in the SAVVE trial on September 1, 2023, having enrolled eighteen (18) patients over the final two (2) months of the study.

On November 16, 2023, we presented preliminary device related thirty-day Device Related Material Adverse Event (“MAE”) data at the 50th Annual VEITH Symposium. The preliminary device related MAE rate for the fully enrolled 75 subject study was eight percent (8%). MAEs for the SAVVE study are defined as all-cause mortality, pulmonary embolisms (“PEs”), ipsilateral deep vein thromboses (“DVTs”), bleeding, and deep wound infections, occurring within thirty (30) days of enrollment in the study, being either device or procedure related. The device related MAEs presented at the conference indicated no deaths, no pulmonary embolisms, and six (6) DVTs, from the fully enrolled cohort of 75 patients. Subsequent to the VEITH presentation, two (2) of the DVTs were adjudicated by the SAVVE Clinical Events Committee (“CEC”) as being moderate and four (4) of the DVTs were adjudicated as being mild. In addition to the DVTs, the safety report also noted a higher-than-expected rate of pocket wound hematomas (anti-coagulation related bleeding outside of the target vein within the surgical cavity) within the first two (2) weeks after surgery, which were deemed to be moderate in severity by the CEC, as well as an expected rate of procedure related wound infections at the site of the skin incisions. The bleeds and wound infections were acute in nature and had no lasting negative impact on patient health or clinical outcomes.

On March 6, 2024, we released initial, six-month topline preliminary revised Venous Clinical Severity Score (rVCSS) efficacy data from the SAVVE study at the VENOUS2024 American Venous Forum Annual Meeting, in Tampa Florida. The data released at VENOUS 2024 indicated that, overall, 97% of the study patients receiving the VenoValve showed clinical improvement as measured by rVCSS at six months, compared to baseline, with 74% of the study patients improving the three (3) or more rVCSS points needed to demonstrate VenoValve’s clinical meaningful benefit (the “Clinical Meaningful Benefit”). The average improvement among the Clinical Meaningful Benefit cohort was 8 points, more than two and a half times the amount of rVCSS improvement required to demonstrate that the VenoValve provides Clinical Meaningful Benefit.

On April 24, 2024, follow-on preliminary rVCSS data was presented at the 46th Annual Charing Cross Symposium in London, England. At a weighted average subject follow-up of 11.64 months, the average improvement among the Clinical Meaningful Benefit (≥ 3 point rVCSS improvement) patient cohort was 8.46 points, including 9.29 points for patients at the two-year milestone, 8.08 points for patients at the one-year milestone, and 8.71 points for patients at the six-month milestone. All rVCSS evaluations were based on the patient’s most recent clinical visit, compared to baseline. Overall, 94% of the study patients receiving the VenoValve showed clinical improvement as measured by rVCSS, at a weighted-average patient follow-up of 11.04 months for the clinical improvement cohort, and 72% of the study patients improved the three or more rVCSS points needed to demonstrate the VenoValve’s Clinical Meaningful Benefit, at a weighted-average patient follow-up of 11.64 months for the Clinical Meaningful Benefit cohort. Total patient follow-up was 762 months for the clinical improvement cohort and 582 months for the Clinical Meaningful Benefit cohort.

On June 21, 2024, the Company presented data showing significant improvement for patients with venous ulcers enrolled in the SAVVE study at the Society for Vascular Surgery 2024 Vascular Annual Meeting in Chicago. The data presented included twenty-one venous ulcer patients who had reached their one-year milestone, representing thirty venous ulcers. Overall, 91% of venous ulcer patients evaluated at one year either had fully healed ulcers or ulcers that had improved. Of that group, 100% of venous ulcers with a duration of one year or less prior to VenoValve surgery were fully healed, with the majority (67%) fully healed 90 days after VenoValve surgery. For those with venous ulcers with a duration of more than one year prior to VenoValve surgery, 89% were either fully healed or improved at one year, representing a decrease in average of total ulcers of 85%. In addition, none of the patients with a fully healed venous ulcer had experienced an ulcer recurrence.

The FDA has indicated that one-year data on all patients will be necessary prior to completing the application seeking pre-market approval (“PMA”) for the VenoValve. On August 14, 2024, the Company announced it had filed and the FDA had approved four of the required five modules of its PMA application. The Company expects to file the fifth and final module of its PMA application in Q4 of 2024.

enVVe

On September 21, 2022, we announced the development of a non-surgical transcatheter based replacement venous valve called enVVe®, for the treatment of CVI of the deep veins of the leg. enVVe is designed to be delivered into the femoral vein of the patient via a minimally invasive procedure requiring no general anesthesia and no overnight hospital stay. Due to the minimally invasive nature of the procedure, we expect to be able to reach patients with less severe CVI or who may otherwise be poor candidates for a surgical device, and estimate the U.S. market for enVVe to be approximately 3.5 million patients.

On October 28, 2024, we announced the successful start to a six-month pre-clinical GLP study for enVVe. The first wave of implants, for the long-term subjects, was successfully completed, with the final wave for the shorter-term subjects scheduled for December. The GLP study is a prerequisite to seeking IDE approval from the FDA to begin the enVVe U.S. pivotal study. The Company expects to file for IDE approval for the enVVe pivotal study in mid 2025.

Capital

We finished 2023 with approximately $46.4 million of cash and investments and had approximately $48.4 million of cash and investments at September 30, 2024. Our future capital requirements will remain dependent upon a variety of factors, especially including the success of our clinical trials, related product development costs, and our ability to successfully bring products to market. We anticipate that our cash burn rate will increase from current levels of approximately $4 million to $5 million per quarter as we conduct our clinical trials and work toward bringing our product candidates to market.

On September 30, 2024, we closed a public offering raising approximately $13.6 million net cash proceeds. Based on management’s current expectations, this capital has the potential to fund the Company through several significant milestones, including the anticipated FDA pre-market approval of the VenoValve, the beginning of preparations for VenoValve commercialization, and the initial stages of the pivotal trial for enVVe. Although we expect our quarterly cash burn rate will increase over time to support these milestones, after the additional proceeds from our offering, we believe we have sufficient cash to fund operations past what we expect will be regulatory approval of the VenoValve and the start of the enVVe pivotal trial.

Comparison of the three months ended September 30, 2024 and 2023

Overview

We reported net losses of $5.6 million and $5.0 million for the three months ended September 30, 2024 and 2023, respectively, representing an increase in net loss of $0.6 million or 12%, due to an increase in operating expenses of $0.8 million, and an increase in other income of $0.2 million.

Revenues

As a developmental stage Company, we are not currently generating revenue and our future revenue, if any, is expected to be diminutive in the near future and dependent on our ability to commercialize our product candidates.

Research and Development Expenses

For the three months ended September 30, 2024, research and development expenses increased by $0.1 million or 2%, to $2.9 million from $2.8 million for the three months ended September 30, 2023. This increase primarily resulted from $0.2 million in increased personnel costs to support the SAVVE study and enVVe development, partially offset by a $0.1 million decrease in lab costs.

Selling, General and Administrative Expenses

For the three months ended September 30, 2024, selling, general and administrative expenses increased by $0.7 million or 27%, to $3.3 million from $2.6 million for the three months ended September 30, 2023. This increase was due to a $0.2 million increase in consulting expense related to market research for the Company’s products, and a $0.7 million increase in legal costs, partially offset by a $0.1 million decrease in share-based compensation, and a $0.1 million decrease in travel expenses due to full enrollment of the SAVVE study during 2023 resulting in less travel to study sites in 2024.

Other Income

For the three months ended September 30, 2024, other income increased $0.2 million or 52.0% to $0.5 million from $0.3 million for the three months ended September 30, 2023. Other income in both periods reflects realized gains, interest, and unrealized gains from our program to invest excess cash in US Treasury bills.

Comparison of the nine months ended September 30, 2024 and 2023

Overview

We reported net losses of $15.6 million and $17.9 million for the nine months ended September 30, 2024 and 2023, respectively, representing a decrease in net loss of $2.3 million, or 13%, due to a decrease in operating expenses of $1.8 million, and an increase in other income of $0.4 million.

Revenues

As a developmental stage Company, we are not currently generating revenue and our future revenue, if any, is expected to be diminutive in the near future and dependent on our ability to commercialize our product candidates.

Research and Development Expenses

For the nine months ended September 30, 2024, research and development expenses decreased by $1.9 million or 18%, to $8.7 million from $10.6 million for the nine months ended September 30, 2023.

This decrease resulted from a $2.7 million reduction in costs related the SAVVE study as it reached full enrollment during the 2023 period requiring less study related enrollment activity during the 2024 period, partially offset by $0.8 million higher compensation cost due to increases in staffing.

Selling, General and Administrative Expenses

For the nine months ended September 30, 2024, selling, general and administrative expenses of $8.4 million were flat when compared to the nine months ended September 30, 2023. This is due to $1.0 million in lower share-based compensation from the reduction in expense from grants made during 2021, the cost for portions of which have been fully recognized, a $0.1 million decrease in travel expenses due to full enrollment of the SAVVE study during 2023 resulting in less travel to study sites in 2024, partially offset by $0.8 million in higher legal cost and a $0.3 million increase in consulting expense related to market research for the Company’s products.

Other Income

For the nine months ended September 30, 2024, other income increased $0.4 million to $1.5 million from $1.1 million for the nine months ended September 30, 2023. Other income in both periods reflects realized gains, interest, and unrealized gains from our program to invest excess cash in U.S. bills.

Liquidity and Capital Resources

For the nine-months ended September 30, 2024, the Company incurred a net loss of $15.6 million and used $11.7 million cash in operating activities. Net cash used in operating activities for the period ended September 30, 2024 decreased by $2.2 million from $13.9 million for the period ended September 30, 2023.

The losses and the uses of cash are primarily due to the Company’s administrative and product research and development activities. Administrative functions relate to costs to support the Company’s public reporting and investor relations activities, readying for commercial development of its lead product candidate in the event of receiving PMA approval from the FDA, and internal administrative functions. Research and development activities are for continued product development and clinical trials for our product candidates, currently the VenoValve® and enVVe®. The Company will continue to incur these costs to complete its clinical trials, enhance products, develop new products, and operate as a public company. Although we have discretion in how we use the Company’s cash resources, we expect to continue these activities for the foreseeable future as we seek to develop and obtain regulatory approval for our product candidates. We are not currently generating revenue and do not expect significant revenue until we successfully commercialize one or more of our product candidates.

Our cash flows from investing activity consist of maturities and purchases of US Treasury bills from our program to invest excess cash, and purchases of property and equipment for our lab and offices. During the nine months ended September 30, 2024 we purchased $33.4 million of treasury bills and $45.8 million of them matured generating $1.4 million in realized gains and interest income. We expect to continue investing as the treasury bills mature and as allowed by the cash requirements of our operations. In the nine months ended September 30, 2024, our purchases of property and equipment consisting primarily of lab and test equipment, were less than $0.1 million.

We do not currently have material commitments for capital expenditures or other expenditures except for our facility lease commitment of $0.4 million per year. However, we expect a modest increase in purchases of property and equipment as we continue SAVVE, plan for commercialization of the VenoValve and continue development of enVVe. Our future capital requirements will remain dependent upon a variety of factors, especially including the success of our clinical trials and related product development costs and our ability to successfully bring products to market.

We have historically funded our operations through financing activities. On September 30, 2024, we closed an offering issuing stock and warrants and raising approximately $13.6 million net cash proceeds. Based upon our cash and working capital as of September 30, 2024 we have sufficient capital resources to meet our obligations as they become due for at least one year after the date of this Report and sustain operations, although we expect to continue incurring losses for the foreseeable future and may need to raise additional capital to sustain our operations, pursue our product development initiatives and penetrate markets for the sale of our products. Any inability to raise additional financing in the foreseeable future would have a material adverse effect on us.

As of October 28, 2024, we had cash and investments of $47.1 million.

Off-Balance Sheet Arrangements

None.

Contractual Obligations

As a smaller reporting company, we are not required to provide the information requested by paragraph (a)(5) of this Item.

Critical Accounting Policies and Estimates

For a description of our critical accounting policies, see Note 3 – Significant Accounting Policies in Part 1, Item 1 of this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

Item 4: Controls and Procedures

Disclosure Controls and Procedures

Our management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer (who is our Principal Executive Officer) and our Chief Financial Officer (who is our Principal Financial Officer and Principal Accounting Officer), of the effectiveness of the design of our disclosure controls and procedures (as defined by Exchange Act Rules 13a-15(e) or 15d-15(e)) as of September 30, 2024, pursuant to Exchange Act Rule 13a-15(b). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2024.

Changes in Internal Control over Financial Reporting

During the nine months ended September 30, 2024, there were no changes in our internal controls over financial reporting, or in other factors that could significantly affect these controls, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations of Controls

Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and all fraud. Controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or deterioration in the degree of compliance with the policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

From time to time we may be subject to litigation and arbitration claims incidental to its business. Such claims may not be covered by our insurance coverage, and even if they are, if claims against us are successful, they may exceed the limits of applicable insurance coverage.

The Company was party to litigation with former employee, Robert Rankin, who resigned on March 30, 2020. The matter was resolved on October 21, 2024 and all complaints and cross complaints were dismissed with prejudice.

Item 1A. Risk Factors

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item. Our current risk factors are set forth in our Form 10-K, filed with the SEC on February 29, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine and Safety Disclosure

Not applicable.

Item 5. Other Information

Trading Arrangements

On September 19, 2024, Marc Glickman, our Chief Medical Officer, entered into a pre-arranged trading plan (the “10b5-1 plan”) that is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act. Under the 10b5-1 plan, Mr. Glickman can sell up to 653,526 shares of our common stock between December 19, 2024 and December 31, 2025, subject to price and trading limitations under the plan.

Item 6. Exhibits

The following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.