Attached files
Exhibit 99.1
ENDRA Life Sciences Reports Second Quarter 2018 Financial
Results
Management to Host Conference Call Today at 4:30 p.m.
EDT
ANN ARBOR, Michigan – August 13, 2018 - ENDRA Life Sciences
Inc. (“ENDRA”) (NASDAQ: NDRA), a developer of
enhanced ultrasound technologies, reported its financial and
operational results for the three and six months ended June 30,
2018.
Key Second Quarter 2018 and Subsequent Highlights:
●
Completed TAEUS
liver system and safety testing and now awaiting Health
Canada’s investigational testing authorization (ITA) required
to commence recruitment for the clinical study.
o
The TAEUS
application is under review as a Class-II device for the
investigational testing pathway. Through ENDRA’s
collaboration partners, Health Canada requested clarity on matters
related to product labeling and ENDRA’s study duration. These
comments are consistent with the normal application approval
process.
●
Granted four U.S.
patents supporting the TAEUS™ clinical product, bringing
ENDRA’s total current intellectual property portfolio to 39
patents and patent applications that are in preparation, filed,
issued or licensed, encompassing a range of device and
method-focused IP in targeted global markets:
o
Two U.S. patents
for correcting fat-induced aberrations & imaging biological
tissue structures;
o
One U.S. patent for
magnetic resonance imaging (MRI) safety based on TAEUS technology;
and
o
One U.S. patent for
non-Invasive fat assessment to support TAEUS™ clinical
product targeting Non-Alcoholic Fatty Liver Disease.
●
Commenced
pre-commercialization activities to raise industry awareness in
anticipation of the commercial launch in Europe, including securing
exhibit space at notable liver disease and ultrasound industry
events in Basel, Geneva, San Francisco and Chicago in the second
half of 2018.
●
Strengthened
balance sheet with a June 2018 private placement of $1.1 million of
convertible secured notes and warrants with management
participation, extending the company’s operational
runway.
●
Showcased
photoacoustic imaging technology at American Association for Cancer
Research (AACR) annual meeting in Chicago.
Management Commentary
“We
made continued progress towards the commercialization of our next
generation Thermo-Acoustic Enhanced Ultrasound system in the second
quarter,” said Francois Michelon, CEO of ENDRA Life Sciences.
“We believe our unique technology, which will enable
clinicians to visualize human tissue composition, function and
temperature in ways previously possible only with CT & MRI - at
a small fraction of the cost, and at the point-of-care, will see
widespread adoption in the medical community.
1
“While
ENDRA's first TAEUS application will focus on the quantification of
fat in the liver for early detection and monitoring of
Non-Alcoholic Fatty Liver Disease, which affects over 1 billion
people globally, TAEUS is a highly scalable platform with multiple
potential clinical applications and revenue streams. ENDRA’s
goal is to bring new capabilities to ultrasound – a $13B
market opportunity – and thereby broaden access to better
healthcare,” continued Michelon.
“We
remain eager and confident that ENDRA will receive Health Canada
approval despite increased processing time, beyond our original
expectations. In the meantime, we have advanced product development
and have continued to build our intellectual property portfolio,
anchored by the granting of four new U.S. patents, bringing our
total intellectual property portfolio to 39 patents and patent
applications that are in preparation, filed, issued or
licensed.
“Despite
the length of Health Canada’s processing of our application
and its effect on our commercialization timeline, we are ramping up
our go-to-market activities and attending key global industry
events in the second half of 2018, in anticipation of our full
commercial launch in the 2019.
On the
financial front during the second quarter, ENDRA completed a
private placement of convertible secured notes and warrants,
strengthening our balance sheet and extending our operational
runway. The ENDRA management team personally participated in this
financing and we remain confident about the clinical value and
future market adoption of our TAEUS clinical product,”
concluded Michelon.
Second Quarter 2018 Financial Results
The
company did not generate revenue in Q2 2018, compared to $57,772 in
Q2 2017. The decrease is due to a decrease in service revenue from
the company’s installed base of Nexus-128
systems.
Operating
expenses increased to $1.8 million in Q2 2018 as compared to $1.1
million in Q2 2017. The increase in operating expenses was
primarily due to increased research & development costs
associated with the development of the TAEUS product.
Net
loss in Q2 2018 totaled $1.8 million, or ($0.47) per basic and
diluted share, as compared to a net loss of $1.4 million in Q2
2017.
Cash at
June 30, 2018 totaled $2.2 million, as compared to $3.2 million at
March 31, 2018.
Conference Call
ENDRA
CEO Francois Michelon, CFO David Wells and CTO Michael Thornton
will host a conference call, followed by a question and answer
period.
To
access the call, please use the following information:
Date:
Monday, August 13, 2018
Time:
4:30 p.m. ET, 1:30 p.m. PT
Toll-free
dial-in number: 1-877-407-8035
International
dial-in number: 1-201-689-8035
2
Please
call the conference telephone number 5-10 minutes prior to the
start time. An operator will register your name and organization.
If you have any difficulty connecting with the conference call,
please contact MZ Group at 1-949-491-8235.
The
conference call will be broadcast live and available for replay
at http://www.investorcalendar.com/event/35753
and via the investor relations section of the Company’s
website at www.endrainc.com.
A
replay of the conference call will be available after 7:30 p.m.
Eastern time through August 27, 2018.
Toll-free replay
number: 1-877-481-4010
International
replay number: 1-919-882-2331
Replay
ID: 35753
About ENDRA Life Sciences Inc.
ENDRA
Life Sciences Inc. ("ENDRA") (NASDAQ: NDRA) is a developer of
enhanced ultrasound technologies. ENDRA is developing a next
generation Thermo-Acoustic Enhanced UltraSound (TAEUS™)
platform to enable clinicians to visualize human tissue
composition, function and temperature in ways previously possible
only with CT & MRI - at a fraction of the cost, and at the
point-of-care. ENDRA's first TAEUS application will focus on the
quantification of fat in the liver, for early detection and
monitoring of Non-Alcoholic Fatty Liver Disease (NAFLD). ENDRA's
goal is to bring new capabilities to ultrasound - thereby
broadening access to better healthcare. For more information,
please visit www.endrainc.com.
About Non-Alcoholic Fatty Liver Disease (NAFLD)
NAFLD
is a condition closely associated with obesity, diabetes,
hepatitis-C and certain genetic predispositions in which fat
accumulates in the liver. NAFLD affects over 1 billion people
globally and is estimated to cost the U.S healthcare system over
$100B annually. NAFLD is often asymptomatic and, If left untreated,
NAFLD can progress to inflammation (NASH), tissue scarring
(fibrosis), cell death (cirrhosis) and liver cancer. By 2025, NAFLD
is forecast to be the greatest root cause of liver transplants. The
only tools currently available for diagnosing and monitoring NAFLD
are impractical: expensive Magnetic Resonance Imaging (MRI) or an
invasive surgical biopsy.
Forward-Looking Statements
All
statements in this release that are not based on historical fact
are “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements, which
are based on certain assumptions and describe our future plans,
strategies and expectations, can generally be identified by the use
of forward-looking terms such as "believe," "expect," "may,"
"will," "should," "could," "seek," "intend," "plan," "goal,"
"estimate," "anticipate" or other comparable terms. Examples of
forward-looking statements include, among others, statements we
make regarding expectations concerning ENDRA’s ability to
secure regulatory approvals; anticipated product pricing;
expectations with respect to current and future partnerships,
including those with CIMTEC and StarFish; estimates of the timing
of future events and achievements; and expectations concerning
ENDRA’s business strategy. Forward-looking statements involve
inherent risks and uncertainties which could cause actual results
to differ materially from those in the forward-looking statements,
as a result of various factors including, among others, the
following: our ability to develop a commercially feasible
technology; receipt of necessary regulatory approvals; our ability
to find and maintain development partners, market acceptance of our
technology, the amount and nature of competition in our industry;
our ability to protect our intellectual property; and the other
risks and uncertainties described in ENDRA’s filings with the
Securities and Exchange Commission. The forward-looking statements
made in this release speak only as of the date of this release, and
ENDRA assumes no obligation to update any such forward-looking
statements to reflect actual results or changes in expectations,
except as otherwise required by law.
Company Contact:
David
Wells
Chief
Financial Officer
(734)
997-0464
investors@endrainc.com
www.endrainc.com
Media & Investor Relations Contact:
MZ North America
Chris Tyson
Managing Director
(949) 491-8235
NDRA@mzgroup.us
www.mzgroup.us
3
ENDRA Life Sciences Inc.
Condensed Consolidated Balance Sheets
|
June
30
|
December
31,
|
Assets
|
2018
|
2017
|
Assets
|
(Unaudited)
|
|
Cash
|
$2,205,858
|
$5,601,878
|
Accounts
receivable
|
11,770
|
6,850
|
Prepaid
expenses
|
318,924
|
67,497
|
Inventory
|
279,210
|
191,680
|
Other current
assets
|
18,553
|
14,249
|
Total Current
Assets
|
2,834,315
|
5,882,154
|
Other
Assets
|
|
|
Fixed assets,
net
|
211,345
|
241,549
|
Total
Assets
|
$3,045,660
|
$6,123,702
|
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
Current
Liabilities:
|
|
|
Accounts payable
and accrued liabilities
|
$751,376
|
$848,214
|
Senior secured
convertible promissory notes payable, net of discount
|
353,581
|
-
|
Total
Liabilities
|
1,104,957
|
848,214
|
|
|
|
Stockholders’
Equity
|
|
|
Preferred stock,
$0.0001 par value; 10,000,000 shares authorized; no shares issued
or outstanding
|
-
|
-
|
Common stock,
$0.0001 par value; 50,000,000 shares authorized; 3,923,027 and
3,923,027 shares issued and outstanding
|
392
|
392
|
Additional paid in
capital
|
24,507,821
|
23,170,531
|
Accumulated
deficit
|
(22,567,510)
|
(17,895,435)
|
Total
Stockholders’ Equity
|
1,940,703
|
5,275,488
|
Total
Liabilities and Stockholders’ Equity
|
$3,045,660
|
$6,123,702
|
4
ENDRA Life Sciences Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
|
Three Months Ended
|
Three Months Ended
|
Six Months Ended
|
Six Months Ended
|
|
June 30
|
June 30
|
June 30
|
June 30
|
|
2018
|
2017
|
2018
|
2017
|
Revenue
|
$-
|
$57,772
|
$6,174
|
$57,772
|
|
|
|
|
|
Cost
of Goods Sold
|
-
|
51,427
|
-
|
51,427
|
|
|
|
|
|
Gross Profit
|
$-
|
$6,345
|
$6,174
|
$6,345
|
|
|
|
|
|
Operating Expenses
|
|
|
|
|
Research
and development
|
839,756
|
174,725
|
2,508,579
|
270,539
|
Sales
and marketing
|
41,357
|
6,904
|
148,534
|
8,028
|
General
and administrative
|
941,956
|
881,570
|
2,009,747
|
1,145,329
|
Total
operating expenses
|
1,823,068
|
1,063,199
|
4,666,860
|
1,423,897
|
|
|
|
|
|
Operating
loss
|
(1,823,068)
|
(1,056,855)
|
(4,660,686)
|
(1,417,552)
|
|
|
|
|
|
Other Expenses
|
|
|
|
|
Other
income (expense)
|
(23,704)
|
(374,937)
|
(11,389)
|
(755,862)
|
Total
other expenses
|
(23,704)
|
(374,937)
|
(11,389)
|
(755,862)
|
|
|
|
|
|
Loss
from operations before income taxes
|
(1,846,772)
|
(1,431,791)
|
(4,672,075)
|
(2,173,414)
|
|
|
|
|
|
Provision
for income taxes
|
-
|
-
|
-
|
-
|
|
|
|
|
|
Net Loss
|
$(1,846,772)
|
$(1,431,791)
|
$(4,672,075)
|
$(2,173,414)
|
|
|
|
|
|
Net
loss per share – basic and diluted
|
$(0.47)
|
$(0.59)
|
$(1.19)
|
$(1.37)
|
|
|
|
|
|
Weighted average common shares – basic and
diluted
|
3,923,027
|
2,437,010
|
3,923,027
|
1,584,906
|
5
ENDRA Life Sciences Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
|
Six Months Ended
|
Six Months Ended
|
|
June 30
|
June 30
|
|
2018
|
2017
|
Cash
Flows from Operating Activities
|
|
|
Net
loss
|
$(4,672,075)
|
$(2,173,414)
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
Depreciation and
amortization
|
30,204
|
30,964
|
Common stock,
options and warrants issued for services
|
749,749
|
306,184
|
Interest on
discount of convertible debt
|
-
|
711,472
|
Imputed interest on
promissory notes
|
-
|
1,480
|
Amortization of
debt discount
|
5,822
|
-
|
Changes in
operating assets and liabilities:
|
|
|
Increase in
accounts receivable
|
(4,920)
|
-
|
Increase in prepaid
expenses
|
(251,428)
|
(4,200)
|
Increase in
inventory
|
(87,530)
|
(93,316)
|
Increase in other
asset
|
(4,304)
|
(272)
|
Decrease in
accounts payable and accrued liabilities
|
(96,838)
|
(157,618)
|
Net cash used in
operating activities
|
(4,331,320)
|
(1,378,720)
|
|
|
|
Cash
Flows from Investing Activities:
|
|
|
Purchases of fixed
assets
|
-
|
(7,862)
|
Net cash used in
investing activities
|
-
|
(7,862)
|
|
|
|
Cash
Flows from Financing Activities
|
|
|
Proceeds from
issuance of common stock, net of fees
|
-
|
8,590,700
|
Repayment of notes
payable
|
-
|
(50,000)
|
Proceeds from
senior secured convertible promissory notes, net of
fees
|
935,300
|
225,000
|
Net cash provided
by financing activities
|
935,300
|
8,765,700
|
|
|
|
Net
Increase/(Decrease) in cash
|
(3,396,020)
|
7,379,118
|
|
|
|
Cash, beginning of
period
|
5,601,878
|
144,953
|
|
|
|
Cash,
end of period
|
$2,205,858
|
$7,524,071
|
|
|
|
Supplemental
disclosures:
|
|
|
Interest
paid
|
$-
|
$-
|
Income
tax paid
|
$-
|
$-
|
|
|
|
Supplemental
disclosures of non-cash Items:
|
|
|
Discount on
convertible notes
|
$587,541
|
$225,000
|
6