avgr20240930

avgr20240930_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒

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

For the quarterly period ended September 30, 2024

☐

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

Commission File Number: 001-36817

AVINGER, INC.

(Exact name of registrant as specified in its charter)

Delaware		20-8873453
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

400 Chesapeake Drive

Redwood City, California 94063

(Address of principal executive offices and zip code)

(650) 241-7900

(Telephone number, including area code)

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

Title of each class:		Trading Symbol(s):		Name of each exchange on which registered:
Common Stock, par value $0.001 per share		AVGR		The Nasdaq Capital Market

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 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 definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐		Accelerated filer ☐

Non-accelerated filer ☒		Smaller reporting company ☒

		Emerging growth company ☐

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 Act). Yes ☐ No ☒

As of November 4, 2024, the number of outstanding shares of the registrant’s common stock, par value $0.001 per share, was 3,196,791.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements concerning our business, operations and financial performance and condition, as well as our plans, objectives and expectations for our business, operations and financial performance and condition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “positioned,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:

●

our ability to continue as a going concern;

●

our ability to regain and remain in compliance with the listing requirements of the Nasdaq Capital Market;

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the outcome of and expectations regarding our current clinical studies and any additional clinical studies we initiate;

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our plans to modify our current products, or develop new products, to address additional indications;

●

our ability to obtain additional financing through future equity or debt financings;

●

the expected timing of 510(k) clearances by the U.S. Food and Drug Administration (“FDA”) which may include but are not limited to additional versions of Pantheris, Ocelot, Tigereye and Lightbox;

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the expected timing of 510(k) submission to the FDA, and associated marketing clearances by the FDA, which may include but are not limited to additional versions of Pantheris, Ocelot, Tigereye and Lightbox;

●

our ability to realize benefits from our license and collaboration agreements with Zylox-Tonbridge;

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the expected growth in our business and our organization;

●

our expectations regarding government and third-party payor coverage and reimbursement, including the ability of Pantheris to qualify for reimbursement codes used by other atherectomy products;

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our ability to retain and recruit key personnel, including the continued development of our sales and marketing infrastructure;

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our ability to obtain and maintain intellectual property protection for our products;

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our estimates of our expenses, ongoing losses, future revenue, capital requirements and our needs for, or ability to obtain, additional financing;

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our expectations regarding revenue, cost of revenue, gross margins, and expenses, including research and development and selling, general and administrative expenses;

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our ability to identify and develop new and planned products and acquire new products, including those for the coronary market;

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our financial performance;

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our ability to remain in compliance with laws and regulations that currently apply or become applicable to our business, both in the United States and internationally; and

●

developments and projections relating to our competitors or our industry.

We believe that it is important to communicate our future expectations to our investors. However, there may be events in the future that we are not able to accurately predict or control and that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. These forward-looking statements are based on management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management’s beliefs and assumptions and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this Quarterly Report on Form 10-Q may turn out to be inaccurate. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the “Risk Factors” section and elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 20, 2024. We urge you to consider these factors carefully in evaluating the forward-looking statements. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. We assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q to conform these statements to actual results or to changes in our expectations.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed with the United States Securities and Exchange Commission (“SEC”) as exhibits to the Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.

AVINGER, INC.

AS OF AND FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2024

TABLE OF CONTENTS

		Page
Part I	Financial Information
Item 1.	Unaudited Financial Statements	1
	Condensed Balance Sheets	1
	Condensed Statements of Operations and Comprehensive Loss	2
	Condensed Statements of Stockholders’ Equity	3
	Condensed Statements of Cash Flows	5
	Notes to Condensed Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38

Part II	Other Information
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43
Item 3.	Defaults Upon Senior Securities	43
Item 4.	Mine Safety Disclosures	43
Item 5.	Other Information	43
Item 6.	Exhibits	44

Signatures		45

“Avinger,” “Pantheris,” “Lumivascular,” and “Tigereye” are trademarks of our company. Our logo and our other trade names, trademarks and service marks appearing in this Quarterly Report on Form 10-Q are our property. Other trade names, trademarks and service marks appearing in this Quarterly Report on Form 10-Q are the property of their respective owners. Solely for convenience, our trademarks and trade names referred to in this Quarterly Report on Form 10-Q appear without the ™ symbol, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or the right of the applicable licensor to these trademarks and trade names.

PART I. FINANCIAL INFORMATION

ITEM 1. UNAUDITED FINANCIAL STATEMENTS

AVINGER, INC.

CONDENSED BALANCE SHEETS

(unaudited)

(In thousands, except share and per share data)

	September 30,			December 31,
	2024			2023
Assets
Current assets:
Cash and cash equivalents	$	5,901		$	5,275
Accounts receivable, net of allowance for doubtful accounts of $56 and $41 at September 30, 2024 and December 31, 2023, respectively		877			1,014
Inventories, net		3,759			5,298
Prepaid expenses and other current assets		947			575
Total current assets		11,484			12,162

Right of use asset		1,427			1,102
Property and equipment, net		466			487
Other assets		224			19
Total assets	$	13,601		$	13,770

Liabilities and stockholders’ equity (deficit)
Current liabilities:
Accounts payable	$	921		$	777
Accrued compensation		1,962			2,311
Preferred stock dividends payable		653			—
Accrued expenses and other current liabilities		589			817
Leasehold liability, current portion		1,210			1,102
Borrowings		4,168			14,293
Total current liabilities		9,503			19,300

Leasehold liability, long-term portion		217			—
Other long-term liabilities		6			672
Total liabilities		9,726			19,972

Commitments and contingencies (Note 6)

Stockholders’ equity (deficit):
Preferred stock issuable in series, par value of $0.001;
Shares authorized: 5,000,000 at September 30, 2024 and December 31, 2023;
Shares issued and outstanding: 30,229 and 62,881 at September 30, 2024 and December 31, 2023, respectively; aggregate liquidation preference of $18,338 and $62,796 at September 30, 2024 and December 31, 2023, respectively		—			—
Common stock, par value of $0.001;
Shares authorized: 100,000,000 at September 30, 2024 and December 31, 2023;
Shares issued and outstanding: 2,783,891 and 1,279,928 at September 30, 2024 and December 31, 2023, respectively		3			1
Additional paid-in capital		438,153			414,493
Accumulated deficit		(434,281	)		(420,696	)
Total stockholders’ equity (deficit)		3,875			(6,202	)
Total liabilities and stockholders’ equity (deficit)	$	13,601		$	13,770

AVINGER, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited)

(In thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Revenues	$	1,650		$	1,817		$	5,356		$	5,746
Cost of revenues		1,224			1,429			4,209			4,117
Gross profit		426			388			1,147			1,629

Operating expenses:
Research and development		1,086			1,044			3,052			3,388
Selling, general and administrative		3,009			3,377			10,980			10,261
Total operating expenses		4,095			4,421			14,032			13,649
Loss from operations		(3,669	)		(4,033	)		(12,885	)		(12,020	)

Interest expense, net		(48	)		(455	)		(698	)		(1,292	)
Other income (expense), net		11			12			(2	)		16
Net loss and comprehensive loss		(3,706	)		(4,476	)		(13,585	)		(13,296	)
Accretion of preferred stock dividends		(349	)		2,436			(652	)		—
Gain on exchange of Series A for Series A-1 convertible preferred stock		—			—			1,908			—
Net loss applicable to common stockholders	$	(4,055	)	$	(2,040	)	$	(12,329	)	$	(13,296	)

Net loss per share attributable to common stockholders, basic and diluted	$	(1.82	)	$	(2.92	)	$	(6.93	)	$	(21.48	)

SEC Form 10-Q filed by Avinger Inc.