NeuroOne Medical Technologies Corporation

Ladies and gentlemen, thank you for standing by and welcome to the NeuroOne Medical Technologies Corporation first quarter of fiscal 2022 earnings conference call. Today's call will be conducted by the company's chief executive officer, Dave Rosa, and its chief financial officer, Ron McClurg. Before I turn the call over to Mr. Rosa, I'd like to remind you that this conference call will include forward-looking statements within the meaning of U.S. federal security laws with respect to future operations, financial results, events, trends, and performance. which are based on management's beliefs and assumptions as of today's call or other specified date. Forward-looking statements may involve known and unknown risks, uncertainties, and other factors, which may cause actual results to differ materially from those expressed or implied by such statements. See our earnings release and SEC filings for information regarding specific risks and uncertainties that could cause actual results to differ. Except as required by law, we undertake no obligation to update such forward-looking statements. With that said, I'll turn the call over to Dave Rosa, CEO of NeuroOne. Dave?

Thanks, Operator, and good afternoon to everyone. During and since the first quarter, we continue to make progress in advancing our thin-film electrode platform technology with respect to both the diagnostic and therapeutic applications. I'll start first with diagnostic applications. As you may recall, in September 2021, our EVO-SEG depth electrodes received FDA clearance for use up to 24 hours. In fiscal Q1, we submitted to the FDA a request for clearance of the device for temporary use, that is less than 30 days use, with recording, monitoring, and stimulation equipment for the recording, monitoring, and stimulation of electrical signals of the subsurface level of the brain. We submitted responses to questions from the FDA regarding our submission on February 9th, 2022, and the FDA acknowledged receipt of our response on February 10th, 2022. If and when FDA clearance for less than 30-day use is received, the company will begin to fulfill stocking orders that have already been placed by Zimmer Biomet, our distribution partner for the Evo family product line. As a reminder, the company may have the opportunity to receive additional milestone payments from Zimmer Biomet. In addition, we displayed our evocortical electrode product line in Zimmer Biomet's booth at the American Epilepsy Society meeting in December of 2021. We also presented a poster at the meeting titled First FDA Cleared Thin Film Electrode for Intracranial Recording and Monitoring of Brain Activity, Device Testing, and Initial Clinical Use. Shifting to our combined diagnostic and therapeutic ablation electrodes, We've continued to make progress on this program. And as a reminder, this system is expected to save time, money, and is intended to improve patient outcomes by combining both the diagnostic and therapeutic applications into one device. And ideally, one hospitalization, improving the way epilepsy and potentially other neurological conditions are treated today. In addition to providing resources to the program, we continue to work closely with our hardware development partner, RBC Medical Innovations, towards the completion of prototypes of the RF generator, which we expect in calendar three, Q3 of this year. Following the completion of the RF generator prototypes, we expect to submit a 510K application for FDA clearance in the first calendar quarter of 2023. Now moving to our chronic use electrode development, During and since fiscal Q1, we continued to make progress with development of this technology. Most recently, we announced the successful completion of accelerated five-year testing, which demonstrated reliable recording without any issues associated with fluid permeation. This could potentially expand utilization of these electrodes to long-term recording for patients suffering from Parkinson's disease, epilepsy, chronic back pain due to failed back surgeries, as well as the research markets. We expect to release the results of our accelerated five-year stimulation testing later this quarter. Our initial focus with our chronic stimulation program is to target the spinal cord stimulation market, which currently represents over $3 billion in the US market alone. We also bolstered our management team in January of 2022 with the appointment of Chad Wilhelmi as Vice President of Quality Control and Regulatory Affairs. Mr. Wilhelmi joins NeuroOne from HLT Medical, a subsidiary of the Bracco Group, where he was Vice President of Quality Assurance. Chad's appointment further strengthens our executive leadership team and deepens our capabilities as we build the platform for future growth and expansion. On the financial side, we also successfully completed an equity financing during fiscal Q1 with gross proceeds of $13.35 million, which Ron McClurg will touch on as well. In closing, the company made great progress in fiscal Q1 in a wide variety of areas, including commercialization, development, and raising capital, which will allow us to continue to execute our plan to introduce meaningful advances and thin-film electrode technology for a variety of neurological applications. Thank you for your time and attention. I would now like to turn the call over to Ron McClurg for a more in-depth review of our fiscal first quarter financial results. Ron?

Thank you, Dave. Product revenue for the first quarter of fiscal 2022 was $34,000. compared to product revenue of $71,000 in the first quarter of fiscal 2021. Collaboration revenue was 6,000 in the first quarter of fiscal 22 compared to collaboration revenue of 22,000 in the first quarter of fiscal 21. Collaboration revenue was derived from our Zimmer development agreement and represented the portion of the upfront initial development fee payment that was eligible for revenue recognition as of December 31st, 2021. Our total operating expenses in the first quarter of fiscal 2022 were $2.8 million compared to approximately $2.1 million in the same period of the prior year. R&D expense in the first quarter was $1.1 million compared with approximately $0.9 million in the same period of 2021. SG&A expense in the first quarter of fiscal 2022 was 1.7 million compared with 1.2 million in the prior year period. Our net loss for the first quarter of fiscal 22 was 2.8 million or 18 cents per share compared to a net loss of 2 million or 26 cents per share in the first quarter of fiscal 2021. As of December 31st of 2021, the company had cash of approximately 16.2 million compared to 6.9 million at September 30th, 2021. The cash balance at December 31st, 2021 includes proceeds from an underwritten registered public offering of 4,172,000 shares of common stock at a price of $3.20 a share resulting in gross proceeds of approximately $13.35 million. The company had no debt outstanding at December 31, 2021. That concludes my remarks, and I'll now pass it back to the operator to open up the call for Q&A.