Annual Report for Fiscal Year Ending 12-31, 2024 (Form 10-K)

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains certain forward-looking statements that involve risk and uncertainties. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those set forth under the Section entitled "Risk Factors" in Item 1A, and other documents we file with the Securities and Exchange Commission. Historical results are not necessarily indicative of future results.

Special Note Regarding Smaller Reporting Company Status

As a result of being a "smaller reporting company" (as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended), we are allowed and have elected to omit certain information, including three years of year-to-year comparisons, from this Management's Discussion and Analysis of Financial Condition and Results of Operations; however, we have provided all information for the periods presented that we believe to be appropriate and necessary.

Overview

We are a clinical-stage company developing cellular and cell-derived therapeutics for the treatment of cardiovascular and pulmonary diseases with significant unmet medical needs. Our CardiAMP® autologous mononuclear cell therapy platform is being advanced clinically for two cardiac clinical indications based on the mechanism of action of treating microvascular dysfunction demonstrated by these cells in preclinical studies of enhanced microvascular density and reduced fibrosis: ischemic heart failure with reduced ejection fraction (HFrEF) and refractory angina resulting from chronic myocardial ischemia (CMI). Our allogeneic mesenchymal stem cell (MSC) therapy platform is being advanced clinically as an "off the shelf" cell therapy based on the immunomodulatory mechanism of action for the treatment of ischemic inflammatory HFrEF. Our program for these same cells in acute respiratory distress syndrome has had its investigational new drug (IND) approved by FDA, but we have not yet advanced this program in the clinic.

Our therapeutic candidates intended for cardiac indications are enabled by our Helix™ transendocardial biotherapeutic delivery system, which enables minimally invasive catheter-based intramyocardial therapeutic delivery. We partner this therapeutic delivery platform and provide development services selectively with others seeking to develop biotherapeutic interventions for local delivery to the heart.

To date, we have devoted substantially all of our resources to research and development efforts relating to our therapeutic candidates and biotherapeutic delivery systems, including conducting clinical trials, developing manufacturing and sales capabilities, in-licensing related intellectual property, providing general and administrative support for these operations and protecting our intellectual property. We have also generated modest revenues from sales of our approved products. We have funded our operations primarily through the sales of equity and convertible debt securities, and certain government and private grants.

CardiAMP Autologous Cell Therapy for Ischemic Heart Failure (BCDA-01)

The CardiAMP Cell Therapy Heart Failure Trial (CardiAMP HF)

The CardiAMP Heart Failure Trial is a randomized, double-blinded, placebo procedure controlled, multi-center pivotal clinical trial for the treatment of heart failure of reduced ejection fraction (HFrEF). The trial is assessing the safety and effectiveness of the CardiAMP Cell Therapy System for the treatment HFrEF, an investigational device system that has received Breakthrough Device Designation from the FDA. The CardiAMP autologous cell therapy is delivered during a standard minimally invasive catheter-based procedure. Patients are typically discharged after an overnight stay. The cell therapy is designed to promote microvascular repair through enhanced capillary density and reduced fibrosis, both of which have been demonstrated in small and large animal models of disease.

The study enrolled 115 advanced heart failure patients on guideline directed medical therapy, in addition to a 10-patient roll-in cohort. The last protocol specified follow-up visit was completed in October 2024. Close out visits, data monitoring with source data verification and data freeze of primary outcome measures have been completed and final data has been transferred to the independent Statistical Data Analysis Core at the University of Wisconsin. Principal results from the trial are scheduled to be presented at the Late-Breaking Clinical Trials symposium at the American College of Cardiology (ACC) Scientific Sessions on March 30, 2025.

We have submitted the Annual Report for the CardiAMP Heart Failure Trial to FDA, which details our plans for completing patient follow-up and we intend to request a meeting with FDA to discuss the results with respect to approvability of the CardiAMP Cell Therapy System. We also completed a supplementary submission to Japan Pharmaceutical and Medical Device Agency (PMDA) providing answers to PMDA's previous responses on the approvability of the CardiAMP Cell Therapy System based on U.S. data and had a consultation in November 2024, as preparation for a subsequent clinical consultation after results from the CardiAMP Heart Failure Trial are available. Should results meet expectations, there is potential for approval based on this and previous clinical data.

CardiAMP Phase III Trial in Ischemic HFrEF: The CardiAMP Cell Therapy Heart Failure II Trial (CardiAMP HF II)

The CardiAMP Cell Therapy Heart Failure II Trial is a Phase III, multi-center, randomized, double-blinded, sham-controlled study of up to 250 patients with NTproBNP levels >500 pg/ml at up to 40 centers in the United States. This confirmatory trial focuses on patients in active heart failure who demonstrated the greatest benefits in the interim results of the CardiAMP Heart Failure I Trial. In the interim results with 90% of the follow-up data available, this subgroup of patients showed strong signals of benefit, with 86% relative risk reduction in mortality and the primary outcome measure approaching statistical significance at two years.

The primary endpoint in the CardiAMP Heart Failure II Trial is an outcomes composite score based on a three-tiered Finkelstein-Schoenfeld hierarchical analysis. The tiers, starting with the most serious events, would be (1) all-cause death, including cardiac death equivalents such as heart transplant or left ventricular assist device placement, ordered by time to event; (2) non-fatal Major Adverse Coronary and Cerebrovascular Events (MACCE), excluding those deemed procedure-related occurring within the first seven days post-procedure (heart failure hospitalization, stroke or myocardial infarction), ordered by time to event, and (3) change from baseline in quality of life at a minimum of 12 months and a maximum of 24 months.

In August 2024, the FDA approved a protocol amendment for the this trial, which allows patients who would have previously been excluded from treatment to receive additional cell deliveries to achieve the same target minimum dosage utilizing a treatment plan informed by the preprocedural CardiAMP Cell Population Analysis (CPA). The CPA approach was developed to select patients most likely to respond to therapy based on their therapeutic cell composition at screening. Utilizing available clinical results allowed us to refine the algorithm in the CardiAMP Heart Failure II Trial and develop a personalized treatment plan for patients below the CPA acceptance criteria. Such treatment plans adjust the number of dosing aliquots for patients with lower concentrations of important specified cells. Combined, the algorithm modifications and development of the treatment plan approach are expected to increase the number of patients eligible for the trial.

This trial also includes a 30-day window after patient consent and before baseline measures. This is intended to address the Hawthorne effect, where patient behavior changes can occur after they are under closer observation of their care providers. We have multiple consented patients in the screening queue and many sites that are at various stages of the onboarding process.

CardiAMP Autologous Cell Therapy for Chronic Myocardial Ischemia (BCDA-02)

CardiAMP Cell Therapy system, under a second FDA approved investigational device exemption, is being studied in a second related clinical indication of chronic myocardial ischemia with refractory angina. This study is based on the strength of our Phase I and II ischemic heart failure trial data and previous clinical data on CD34+ mononuclear cells in this indication.

The CardiAMP Cell Therapy Chronic Myocardial Ischemia Trial is a Phase III, multi-center, randomized, double-blinded, placebo-controlled study of up to 343 patients at up to 40 clinical sites. The Phase III pivotal trial is designed to provide the primary support for the safety and efficacy of the CardiAMP Cell Therapy System for patients with no option chronic myocardial ischemia with refractory angina (BCDA-02). These patients experience frequent angina (i.e., chest pain) attacks that are uncontrolled by optimal drug therapy, and these patients are not suitable candidates for stent placement or bypass surgery, leaving them few therapeutic options. Our therapeutic approach uses many of the same novel aspects used in the CardiAMP Heart Failure Trial and is expected to leverage our experience and investment in the heart failure trial.

Results from the open-label roll-in cohort of patients having chronic myocardial ischemia with refractory angina showed an average 107 second increase in exercise tolerance and an 82% average reduction in angina episodes at the primary six-month follow-up endpoint compared to before receiving the study treatment. The last consented patient in the roll-in cohort was treated in August 2024, and we are gathering top line results of this cohort at the six-month primary endpoint for publication and presentation.

CardiALLO Allogeneic MSC for Ischemic Heart Failure with HFrEF (BCDA-03)

The FDA approved investigational new drug application (IND) for a Phase I/II trial to deliver our allogeneic MSC for the treatment of HFrEF includes a 3+3 roll-in dose escalation cohort followed by a 60-patient randomized double-blind controlled study and utilizes the Finkelstein Schoenfeld three tier primary composite endpoint of mortality, MACCE, and functional capacity as measured by six-minute walk distance. The low dose cohort of 20 million cells has been completed and there have been no treatment-emergent adverse events, arrhythmias, rejection, or allergic response, consistent with our presentation at the Technology and Heart Failure Therapeutics meeting in March 2024. Per protocol, formal Data Safety Monitoring Board review of these patients will take place in the second quarter of 2025.

We intend to fund later development through nondilutive grant applications and partnering. Phase II development is anticipated to be advanced in both the United States and Japan and would also enroll in approximately one year.

Helix™Biotherapeutic Delivery System

The Helix transendocardial biotherapeutic delivery system is a therapeutic-enabling platform for minimally invasive targeted delivery of biologic agents to the heart. Helix empowers a seamless transition from bench to commercialization for partners. Our biotherapeutic delivery partnerships are expected to enhance future treatment options for millions of people suffering from heart disease, offset the costs of biotherapeutic delivery for our own programs, and provide our investors with meaningful revenue sharing should our partnering efforts contribute to successful therapeutic development.

In March 2024, we announced a biotherapeutic delivery partnership with StemCardia through a Phase I/II Clinical Study. Under the partnership, BioCardia is the exclusive biotherapeutic delivery partner for StemCardia's cell therapy candidate through studies expected to result in FDA approval of an IND and the anticipated Phase I/II clinical development to follow. In July 2024, with our partner CellProthera, we jointly announced success from the collaborative Phase II trial of ProtheraCytes in the Excellent cell therapy study in post-myocardial infarction as well as plans to continue the relationship into a Phase III trial.

Morph®Access Innovations

All procedures using our Helix transendocardial delivery system include the use of a Morph steerable introducer. We are actively transitioning all procedures using our Helix transendocardial delivery system to our new FDA cleared Morph DNA platform. We received FDA market clearance of an 8 French equivalent for transseptal cardiac procedures, under the name AVANCE. One of the device's features is that its tendons are designed to enable deflection rotation around the catheter shaft, providing uniform bending in all directions and a substantial reduction of what is called catheter "whip." This is designed to enhance physician control for many procedures.

In July 2024, we completed our planned submission to the FDA for clearance of a Morph-DNA product family across a range of diameters and lengths. This product family was designed for the treatment of aorto-ostial disease, including renal procedures, superior femoral artery procedures, below the knee procedures and mesenteric artery procedures. The FDA approved this product family for market release in August 2024. The first commercial devices in 45 cm and 70 cm in 8 French configurations are now available, with additional models to be available in later in 2025.

Financial Overview

Revenue

Our primary revenues are derived from our biotherapeutic delivery partnering agreements. Under these partnering agreements, we provide extensive support and our Helix biotherapeutic delivery system from the research bench to commercialization for partners. We also have begun commercializing our FDA cleared AVANCE and Morph DNA steerable introducer products.

Research and Development Expenses

Our research and development expenses consist primarily of:

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salaries and related overhead expenses, which include share-based compensation and benefits for personnel in research and development functions;

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fees paid to consultants and contract research organizations, or CROs, including in connection with our preclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial management and statistical compilation and analysis;

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costs related to acquiring and manufacturing clinical trial materials;

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costs related to compliance with regulatory requirements; and

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payments related to licensed products and technologies.

We expense all research and development costs in the periods in which they are incurred. Costs for certain development activities are recognized based on an evaluation of the progress of completion of specific tasks using information and data provided to us by our vendors and clinical sites. Nonrefundable advance payments for goods or services to be received in future periods for use in research and development activities are deferred and capitalized. The capitalized amounts are then expensed as the related goods are delivered and the services are received.

We plan to increase our research and development expenses as we continue the pivotal CardiAMP autologous cell therapy trials in heart failure and chronic myocardial ischemia, and begin our allogeneic cell therapy trials in heart failure and acute respiratory distress syndrome. We typically use our employee and infrastructure resources across multiple research and development programs, and accordingly, we have not historically allocated resources specifically to our individual programs. There are also significant synergies between these programs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of salaries and related costs for employees in executive, finance and administration, sales, corporate development and administrative support functions, including share-based compensation expenses and benefits. Other selling, general and administrative expenses include sales commissions, rent, accounting and legal services, obtaining and maintaining patents, the cost of consultants, occupancy costs, insurance premiums and information systems costs.

Other Income (Expense)

Other income and expense consist primarily of interest income we earn on our cash and cash equivalents.

Critical Accounting Policies and Estimates

Our management's discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. GAAP. The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various judgements that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not clear from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We define our critical accounting policies as those that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles. Actual results may differ from these estimates under different assumptions or conditions. The following discussion addresses what we believe to be the critical accounting policies used in the preparation of our financial statements that require significant estimates and judgments.

Research and Development-Clinical Trial Accruals

As part of the process of preparing our financial statements, we are required to estimate our expenses resulting from our obligations under contracts with vendors and consultants and clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided to us under such contracts. Our clinical trial accrual is dependent upon the timely and accurate reporting of expenses of our CROs and other third-party vendors.

Our objective is to reflect the appropriate clinical trial expenses in our financial statements by matching those expenses with the period in which services are provided and efforts are expended. We account for these expenses according to the progress of the trial as measured by patient progression and the timing of various aspects of the trial. We determine accrual estimates through discussion with applicable personnel and outside service providers regarding the progress or state of completion of clinical trials, or the services completed. During a clinical trial, we adjust the rate of clinical trial expense recognition if actual results differ from the estimates. We make estimates of our accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known at that time. Although we do not expect that our estimates will be materially different from amounts actually incurred, our understanding of status and timing of services performed relative to the actual status and timing of services performed may vary and may result in our reporting amounts that are too high or too low for any particular period. Through December 31, 2024, there had been no material adjustments to our prior period estimates of accrued expenses for clinical trials. However, due to the nature of estimates, we cannot provide assurance that we will not make changes to our estimates in the future as we become aware of additional information about the status or conduct of our clinical trials.

Share-Based Compensation

We measure and recognize share-based compensation expense for equity awards to employees, directors and consultants based on fair value at the grant date. We use the Black-Scholes-Merton option-pricing model, or BSM, to calculate the fair value of stock options, which includes subjective assumptions such as the risk-free interest rate, the expected volatility in the value of the Company's common stock, and the expected term of the option. Restricted stock units (RSUs) are measured based on the fair market values of the underlying stock on the dates of grant. Share-based compensation expense recognized in the statements of operations is based on awards at the time of grant and is reduced for actual forfeitures at the time that the forfeitures occur. Compensation cost for employee share-based awards will be recognized over the vesting period of the applicable award on a straight-line basis.

Results of Operations

The following table summarizes our results of operations for the years ended December 31, 2024 and 2023 (in thousands).

		Years ended December 31,
		2024				2023
Revenue:
Collaboration agreement revenue		$	58			$	477
Costs and expenses:
Research and development			4,387				7,726
Selling, general and administrative			3,672				4,395
Total costs and expenses			8,059				12,121
Operating loss			(8,001	)			(11,644	)
Other income (expense):
Total other income, net			55				73
Net loss		$	(7,946	)		$	(11,571	)

Revenue. Revenue was $58,000 in the year ended December 31, 2024 as compared to $477,000 in the year ended December 31, 2023. The amount and timing of collaboration revenues is largely dependent on our partners' development activities and may be inconsistent and create significant variation in our revenues.

Research and Development Expenses. Research and development expenses decreased to approximately $4.4 million in the year ended December 31, 2024 as compared to approximately $7.7 million in the year ended December 31, 2023 primarily due to reduced personnel costs and clinical expenses following the completion of the CardiAMP Cell Therapy Heart Failure Trial.

Selling, General and Administrative Expenses. Selling, general and administrative expenses decreased to approximately $3.7 million in the year ended December 31, 2024 as compared to approximately $4.4 million in the year ended December 31, 2023, primarily due to realignment of personnel roles and cost reductions following completion of the CardiAMP Cell Therapy Heart Failure Trial.

Liquidity and Capital Resources

We have incurred net losses each year since our inception and as of December 31, 2024, we had an accumulated deficit of approximately $160.1 million. We anticipate that we will continue to incur net losses for at least the next several years.

We have funded our operations principally through the sales of equity and convertible debt securities. As of December 31, 2024, we had cash and cash equivalents of approximately $2.4 million.

The following table shows a summary of our cash flows for the periods indicated (in thousands):

		Years ended December 31,
		2024				2023
Net cash provided by (used in):
Operating activities		$	(8,026	)		$	(9,974	)
Investing activities			(6	)			(12	)
Financing activities			9,300				3,726
Net increase (decrease) in cash and cash equivalents		$	1,268			$	(6,260	)

Cash Flows from Operating Activities. Cash flow from operating activities for any period is subject to many variables including the timing of cash receipts, payments to suppliers, and vendor payment terms. Cash flow used in operating activities decreased from approximately $10.0 million during the year ended December 31, 2023 to approximately $8.0 million during the year ended December 31, 2024, due primarily to reductions in research and development expense following completion of the CardiAMP Cell Therapy Heart Failure Trial.

Cash Flows from Investing Activities. Net cash used in investing activities of $6,000 and $12,000 during the years ended December 31, 2024 and 2023, respectively, consisted of purchases of property and equipment, primarily lab and office equipment.

Cash Flows from Financing Activities. Net cash provided by financing activities of approximately $9.3 million and approximately $3.7 million during the years ended December 31, 2024 and 2023, respectively, related to net proceeds from the sale of common stock less issuance costs.

September 2024 Financing

On August 29, 2024, we entered into securities purchase agreements (the Purchase Agreements) with certain purchasers, pursuant to which we agreed to issue, and sell and the purchasers, in the aggregate, to buy, in a public offering (the Registered Offering) (i) 1,377,990 shares of our common stock, $0.001 par value per share (the Common Stock), and accompanying warrants to purchase up to 1,377,990 shares of Common Stock (the Common Warrants), at an offering price of $3.00 per share of Common Stock and accompanying Common Warrant, and (ii) pre-funded warrants (the "Pre-Funded Warrants" and, together with the Common Warrants, the "Warrants") to purchase up to 1,022,010 shares of Common Stock and accompanying Common Warrants to purchase up to 1,022,010 shares of Common Stock, at an offering price of $2.999 per Pre-Funded Warrant and accompanying Common Warrant. Certain of the Company's directors and executive officers purchased an aggregate of 211,000 shares of Common Stock and accompanying Common Warrants. The Registered Offering closed on September 3, 2024, with the Company issuing 2,400,000 shares of Common Stock, including the exercise of the Pre-Funded Warrants, and Common Warrants to purchase 2,400,000 shares of Common Stock. Each Common Warrant is exercisable at a price per share of $3.00 and expires on September 3, 2029. The gross proceeds of the Registered Offering were $7.2 million, with associated issuance costs of $926,000.

February 2024 Financing

On February 9, 2024, we entered into a Securities Purchase and Registration Rights Agreement relating to a private placement with certain qualified institutional buyers and institutional accredited investors, which closed on February 13, 2024. Pursuant to the agreement, we sold 134,199 shares of our common stock, and warrants to purchase 67,104 shares of our common stock at an exercise price equal to $6.60 per warrant share, subject to certain adjustments, as provided under the terms of the warrant, which are exercisable at any time before February 13, 2026. The gross proceeds of the Offering were $875,000, with associated issuance costs of $43,000.

November 2023 Financing

On November 16, 2023, we sold to a single healthcare-focused institutional investor 133,333 shares of our common stock in a registered direct offering (the November 2023 RDO Offering) at a price of $9.75 per share. The gross proceeds of the November 2023 RDO Offering were $1.3 million, with associated issuance costs of $312,000.

June 2023 Financing

On June 21, 2023, we sold to certain existing investors and other institutional investors, as well as certain of our directors and executive officers, 75,543 shares of our common stock in a registered direct offering (the June 2023 Offering) at an offering price of $35.04 per share. Certain of our directors and executive officers purchased an aggregate of 13,556 of such shares. The gross proceeds of the June 2023 Offering were approximately $2.6 million, with associated issuance costs of $194,000.

ATM Offerings

On April 12, 2022, we entered into a sales agreement (Cantor Sales Agreement) with Cantor Fitzgerald & Co. (Cantor) as the sales agent, pursuant to which we may offer and sell, from time to time, through Cantor, shares of common stock having an aggregate offering price of up to $10.5 million (ATM Offering). Under the terms of the Cantor Sales Agreement, Cantor was paid a commission of 3% of the aggregate proceeds from the sale of shares and reimbursed certain legal fees. The prospectus supplement expired in conjunction with the expiration of the corresponding registration statement on October 20, 2023. On June 20, 2023, we agreed with Cantor to indefinitely suspend sales under the ATM Offering, and on November 14, 2023, we agreed to terminate the Cantor Sales Agreement.

On December 6, 2023, we entered into an "At The Market" offering agreement (the Sales Agreement) with H.C. Wainwright & Co., LLC (HCW). Under the Sales Agreement, we may offer and sell our common stock, from time to time having an aggregate offering amount of up to $2.75 million during the term of the Sales Agreement through or to HCW as sales agent or principal, of which $264,000 was available as of September 30, 2024. We have filed a prospectus supplement (the ATM Prospectus Supplement) relating to the offer and sale of the shares pursuant to the Sales Agreement. The offering and sale of the shares will be made pursuant to the Company's previously filed and effective Registration Statement on Form S-3 (File No. 333-275099), which was initially filed with the Securities and Exchange Commission (the "SEC") on October 19, 2023 and declared effective on December 5, 2023. We have agreed to pay HCW a commission equal to 3% of the gross proceeds from the sales of shares and have agreed to provide HCW with customary indemnification and contribution rights.

On December 2, 2024, we filed a prospectus supplement to the ATM Prospectus Supplement that updated the maximum aggregate offering amount to approximately $1.3 million.

During the years ended December 31, 2024 and 2023, we sold an aggregate of 428,864 and 14,349 shares of common stock under the ATM Offerings at then-market prices for total gross proceeds of approximately $2.5 million and $441,000, with associated issuance costs of $94,000 and $179,000, respectively. As of December 31, 2024, approximately $1.3 million

of common stock may still be sold pursuant to the Sales Agreement.

Future Funding Requirements

To date, we have generated modest revenues. We do not know when, or if, we will generate any revenue from our development stage biotherapeutic programs. We do not expect to generate any revenue from sales of our autologous and allogeneic cell therapy candidates unless and until we obtain regulatory approval. At the same time, we expect our expenses to increase in connection with our ongoing development activities, particularly as we continue the research, development and clinical trials of, and seek regulatory approval for, our therapeutic candidates. In addition, subject to obtaining regulatory approval for any of our therapeutic candidates and companion diagnostic, we expect to incur significant commercialization expenses for product sales, marketing, manufacturing and distribution. We anticipate that we will need additional funding in connection with our continuing operations.

Based upon our current operating plan, we believe that the cash and cash equivalents of approximately $2.4 million as of December 31, 2024 are not sufficient to fund our planned expenditures and meet our obligations beyond May 2025. In order to continue development of our therapeutic candidates beyond such time, we plan to raise additional capital, potentially including non-dilutive collaboration and licensing arrangements, debt or equity financing, or a combination from these sources. We may be unsuccessful in raising funds from any or all such sources, and to the extent we raise any funds, they may be on highly dilutive terms. We have based our estimates on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of our therapeutic candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures necessary to complete the development of our therapeutic candidates.

Our future capital requirements will depend on many factors, including:

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the progress, costs, results and timing of our autologous CardiAMP Cell Therapy System and allogeneic Neurokinin-1 Receptor Positive clinical trials and related development programs;

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FDA acceptance of our autologous CardiAMP Cell Therapy System and allogeneic MSC therapies for heart failure and for other potential indications;

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the outcome, costs and timing of seeking and obtaining FDA and any other regulatory approvals;

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the costs associated with securing, establishing and maintaining commercialization and manufacturing capabilities;

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the number and characteristics of product candidates that we pursue, including our product candidates in preclinical development;

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the ability of our product candidates to progress through clinical development successfully;

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our need to expand our research and development activities;

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the costs of acquiring, licensing or investing in businesses, products, product candidates and technologies;

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our ability to maintain, expand and defend the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, defense and enforcement of any patents or other intellectual property rights;

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the general and administrative expenses related to being a public company;

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our need and ability to hire additional management and scientific, medical and sales personnel;

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the effect of competing technological and market developments; and

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our need to implement additional internal systems and infrastructure, including financial and reporting systems.

Until such time that we can generate meaningful revenue from our recurring revenue biotherapeutic delivering partnering business model and/or sales of approved therapies and products, if ever, we expect to finance our operating activities through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements, and other collaborations, strategic alliances and licensing arrangements or a combination of these approaches. To the extent that we are able to raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our existing common stockholders may be highly diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders. Debt financing, if available, may involve agreements that include conversion discounts or covenants limiting or restricting our ability to take specific actions, such as incurring debt, making capital expenditures or declaring dividends. If we raise additional funds through government or other third-party funding, marketing and distribution arrangements or other collaborations, or strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, products, or therapeutic candidates or to grant licenses on terms that may not be favorable to us.

We have prepared our consolidated financial statements as of December 31, 2024 on the basis that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. Due to the factors described above, there is substantial doubt about our ability to continue as a going concern within one year after the date these financial statements are issued. Our ability to continue as a going concern will depend, in a large part, on our ability to raise additional capital. If adequate funds are not available, we may be required to further reduce operating expenses, delay or reduce the scope of our product development programs, obtain funds through arrangements with others that may require us to relinquish rights to certain of our technologies or products that we would otherwise seek to develop or commercialize ourselves, or cease operations. While we believe in the viability of our strategy to raise additional funds, there can be no assurances that we will be able to obtain additional capital on acceptable terms and in the amounts necessary to fully fund our operating needs.

The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. If we are unable to continue as a going concern, we may be forced to liquidate assets. In such a scenario, the values received for assets in liquidation or dissolution could be significantly lower than the values reflected in our consolidated financial statements.

Off-Balance Sheet Arrangements

During the years presented, we did not have, nor do we currently have, any off-balance sheet arrangements as defined under the rules of the SEC.

Recent Accounting Pronouncements

See Note 2 of our notes to the consolidated financial statements for information regarding recent accounting pronouncements that are of significance or potential significance to us.