Final Results

Strong foundations laid ahead of planned regulatory submissions in 2023


Operational Highlights:

US Burn Indication supported by BARDA (Biomedical Advanced Research and Development Authority)

  • Awarded US$ 8.2 million contract expansion to accelerate the commercialization pathway for DeepView™
  • Burn Image Assessment Study (“BIAS”) findings reinforce DeepView™’s value proposition and clinical need:
    • In 31% of healing wounds Emergency Department (“ED”) physicians incorrectly selected immediate referral to a burn center or surgery
    • In 74% of non-healing wounds ED physicians failed to select immediate referral or surgery
  • Adult enrollment in Burn AI training study completed

Diabetic Foot Ulcer (“DFU”) Indication

  • Clinical Study is on track to complete enrollment by end of Q2 2023 to support DeepView™ AI-DFU FDA regulatory submission in 2023

Commercial readiness

  • Strengthened senior leadership team with four key appointments: Niko Pagoulatos, Chief Operating Officer; Christine Marks, VP Marketing & Commercialization; Vince Capone, General Counsel & Company Secretary; and Mary Regan, VP of Clinical Affairs
  • Won Best Technology Award at the European Mediscience Awards in June 2022

Financial Highlights:

  • R&D revenue up 67% to US$ 25.4 million (2021: US$ 15.2 million) funding Burn indication development as well as the development of handheld prototype DeepView SnapShot® M
  • Strong cash position with cash on hand of US$ 14.2 million (2021: US$ 16.1 million)

Post-Period Highlights:

US Burn Indication

  • Pediatric enrollment in Burn AI training study has been completed in February 2023.
  • Federal contract opportunity initiated for Health and Human Services Burn Wound Imaging technology. Company responded with proposal and will be evaluated for contract fulfillment.
  • DeepView™ AI-3D developed to capture millimetric level wound size measurement accuracy with single image acquisition without requiring external reference markers for seamless integration into the clinical workflow.

DFU Indication

  • Successful interim results reported showing AI diagnostic accuracy improvement from 81% to 86%.
  • US clinical study is on track with additional sites being incorporated in Q1 2023, providing data to support FDA and UKCA regulatory submissions.
  • Initiated EU clinical study with the Royal College of Surgeons in Ireland (“RCSI”) conducted at Connolly Hospital in Dublin, Ireland.

Wensheng Fan, Chief Executive Officer of Spectral MD, said: “We are pleased with the rate of progress and development made in 2022 and have delivered strong operational results for both our Burn and DFU indications. Spectral MD also exceeded financial expectations during the period through effective cost management. Importantly, this will allow the Company to increase investment in 2023 to drive forwards our commercialization strategy for DFU.

“Our immediate strategy remains focused on commercialization planning activities. We are in regular communication with BARDA to further develop our infrastructure readiness for a federal level commercial contract and look forward to building upon our strong momentum, whilst continuing to collaborate with BARDA and our clinical partners to scale and advance our transformative technology.

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.


Chief Executive’s Review

I am pleased to present the audited results for the twelve months ended 31 December 2022 for Spectral MD, Holdings, Ltd. 2022 was a year focused on sizable expansion, and development of our DeepView™ technology and operations. Spectral MD continues to make significant advances in the development of the DeepView™ Wound Imaging Technology for both Burn and DFU indications, as the Company continues to work towards commercialization.

The development of each AI application involves an initial study for training the AI algorithm followed by a separate clinical validation study, subsequently followed by regulatory submission. Below is an update and outlook on each application, and on other key strategic elements.

Burn Indication (BARDA)


Spectral MD has received substantial support from the US Government, with contracts from institutions such as the BARDA, National Science Foundation (“NSF”), National Institute of Health (“NIH”) and Defense Health Agency (“DHA”) in support of the Burn indication for its DeepView™ platform. Total grant funding awarded to date from these organizations is over US$ 125 million, including the recently awarded US$ 8.2 million BARDA contract expansion. The Company is in regular communication with BARDA to further develop its infrastructure readiness for a federal level commercial contract.

This US$ 8.2 million contract expansion from BARDA awarded in August 2022 helps the Company further accelerate the commercialization pathway for the Company’s DeepView™ Wound Imaging System. The award expanded the current clinical training study for burn wounds by adding clinical sites, further increases DeepView™’s interoperability with health systems’ electronic health records (“EHR”) and boosts the Company’s manufacturing capacity readiness.

In 2022, the Company made substantial progress in the Burn AI Training study, completing adult enrollment, and getting close to the enrollment goal for pediatrics. As of 31 December 2022, the Company’s proprietary, and clinically validated database for burns, is comprised of 6.7 terabytes and 263 billion pixels. This database presents both a significant barrier to entry to would-be competitors in wound care healing assessment, and a potential additional commercial opportunity for the Company to develop further in the future.

Emergency Department Update

The unpredictability of severe burn injuries is a complex critical care problem. As training in burn injuries is no longer required during medical training residency, the appropriate determination of burn depths is extremely low. In published literature, non-burn care providers are accurate 50% of the time in predicting early healing potential in burn injuries using visual clinical judgment. Due to the lack of lab tests and diagnostic tools, some Emergency Department (“ED”) physicians often adopt the “wait and see” approach for wound progression for 3-7 days, thereby occupying valuable bed space, additional costs, longer hospital stays and over-excision of viable skin. Some physicians prefer to directly transfer the patient to a specialty burn center. This practice is confirmed by the published Journal of Burn Care Research that found 41% of patients with Total Body Surface Area (“TBSA”) less than 10% were unnecessarily transferred to burn centers for specialized treatment and discharged within 24 hours. 

In alignment with BARDA’s emergency preparedness mission, the US$ 8.2 million contract expansion awarded in August 2022 provides funding to expand the current Burn AI dataset to include ED patient enrollment. The addition of EDs will facilitate establishing a clinical benchmark for DeepView®'s ED burn healing assessment, which the Company anticipates will have a major impact in the delivery of care for burns in that setting.

In February 2022, the Company and the FDA conducted a pre-submission meeting for alignment on the Company’s ED strategy. The FDA’s feedback confirmed the Company’s ED approach and stated that they see utility of DeepView™ in Emergency Rooms across the US.

Burn Image Assessment Study (BIAS) Update

The goal of the Institutional Review Board (“IRB”) approved Burn Image Assessment Study (“BIAS”) was to quantify the current US clinical visual judgment of burn wound healing assessment from ED and Burn healthcare professionals to determine clinicians’ accuracy of burn wound healing assessment from still images.

In 2022, the BIAS study was conducted at four national conferences, American Burn Association (“ABA”), Southern Region Burn Conference (“SRBC”), American Academy of Emergency Medicine (“AAEM”), and American College of Emergency Physicians (“ACEP”). The Company invited Emergency Medicine and Burn clinicians from across the country to participate in the BIAS study at its exhibit booth.

The BIAS study demonstrated that ED physicians incorrectly selected immediate referral to a burn center or surgery in 31% of healing wounds and failed to select immediate referral or surgery in 74% of non-healing wounds. This reinforces DeepView™’s value proposition that ED physicians need clinical decision support in assessing healing potential of burn wounds.


In February 2023, Spectral MD completed the enrollment for pediatrics in the Burn AI Training Study. Following completion of enrollment for pediatrics, the Company plans to complete its pre-submission to the FDA to achieve alignment on the Burn Validation Study protocol. The Company also plans to initiate its Burn AI Validation Study in 2023, with data collected supporting its FDA submission for DeepView™’s Burn indication.

The Company continues to be in regular communication with BARDA to further develop its infrastructure readiness for a potential federal level commercial contract award. A federal contract opportunity for Health and Human Services Burn Wound Imaging technology has been initiated and the Company responded with its proposal. Spectral MD will be evaluated for contract fulfillment. The Company is fully committed to upscaling its operations and infrastructure in the near term to ramp up commercial readiness by the end of 2024 and into 2025 for deployment of DeepView™ technology into health systems across the US.

While our commercial priority for the Burn indication continues to be BARDA, the Company is also optimistic about the opportunity to gain regulatory approval in the UK following amendments to the UK regulatory regime post Brexit. The Company is evaluating an accelerated UK regulatory submission pathway for 2023.

DFU Indication


The Company made substantial progress in its US DFU clinical validation study (the “US DFU Clinical Study”) in 2022 and is on track with additional sites being incorporated in Q1 2023. The endpoint of the clinical study is to predict on “Day One” if the DFU wound will reduce in size by 50% by week four. The Company performed an interim analysis showing improvement of the AI diagnostic accuracy by five percentage points to 86%.

The data collected from the clinical study will be used to augment the Company’s existing proprietary and clinically validated database of DFU data and healthcare matrix information; and to validate the DeepView™ DFU AI algorithm as the Company prepares for US regulatory submission in 2023.


In H1 2023, the Company will continue to enroll subjects in the US DFU Clinical Study to finalize its admission goal. Following effective cost management mainly related to the US DFU Clinical Study, the Company expects to increase investment in its DFU indication in 2023 to drive its commercialization strategy. Post period end, the Company continued to enroll subjects in the US DFU clinical study, and we look forward to the enrollment progress which is expected to conclude by mid-2023. In preparation of submitting for regulatory approval, Spectral MD plans to conduct a pre-submission meeting with the FDA to ensure alignment for its future final regulatory submission. In H2 2023, the Company will submit for FDA and UKCA regulatory evaluations. Regulatory approvals are expected to be granted by end of 2023 for UKCA and in H1 2024 for FDA.

In February 2023, the Company also initiated a clinical study in the EU with the Royal College of Surgeons in Ireland conducted at Connolly Hospital in Dublin, Ireland. The EU clinical study will collect data from DFU patients monitored up to 12 weeks. The intention of the clinical study is to further develop DeepView AI® -DFU algorithm and support the 2023 Company’s regulatory submissions for UKCA, US FDA, and EU CE Mark.

Technology Miniaturization (DeepView SnapShot® M)


The Company has previously been awarded STTR Phase I (US$ 150k), Phase II (US$ 624k), and Sequential Phase II (US$ 1.1 million) amounting to US$ 1.8 million. This funding enabled the Company to improve upon key optical and computing capabilities, which led to the DeepView SnapShot®M, a fully handheld prototype and wireless version of the cart-based Deep View™ solution with similar performance to the Company’s cart-based system.


The Company is committed to the development and clinical research of the DeepView SnapShot®M technology and is working towards advancing the current prototype.

People and Organization


With the Company accelerating towards commercialization, much focus has been given to the development, hiring, and retention of highly skilled individuals with proven commercial track records. In 2022, the Company saw a headcount growth of +29% with the addition of 16 full-time employees. The Company currently has 71 full-time employees in the US and UK. Spectral MD hired three additional personnel in the UK to accelerate regulatory and commercialization goals. The Company continues to prioritize recruitment in the areas of operations, production, regulatory, marketing, government contracts, and product development, which it believes will enable it to meet technology, IP, clinical, regulatory and commercialization readiness goals in 2023 and 2024.

In November 2022, the Company successfully strengthened the leadership team by appointing Dr. Niko Pagoulatos as Chief Operating Officer of Spectral MD. As Chief Operating Officer of Spectral MD, reporting to CEO Wensheng Fan, Dr. Pagoulatos will accelerate growth and operational performance of the Company with specific focus on scientific research, engineering, product development leading to global portfolio launch and clinical adoption. In addition to Dr. Pagoulatos’ appointment, in 2022 the Company also added Christine Marks, VP of Marketing and Commercialization, Vince Capone, General Counsel and Company Secretary, and promoted Mary Regan, VP of Clinical Affairs, to the leadership team.


The Company expects to strengthen its professional team to meet the demand for commercial sales contracts, including the potential federal level commercial contract. The Company will dedicate funding support toward human and infrastructure readiness to execute its go-to marketing strategy. Additional personnel to include sales, clinical research staff, clinical educators, field service technicians and product management as Spectral MD advances toward regulatory and commercial milestones.

Intellectual Property (IP) Development

Developing and protecting Spectral MD’s intellectual property is one of the Company’s key priorities. In 2022, the Company filed a total of nine new patent applications, including two US continuation/divisional applications, five foreign applications, one international Patent Cooperation Treaty application (high-precision, single-aperture, MSI snapshot imaging with multiplexed illumination), and one new provisional application (topological characterization and assessment of tissue). 

Five new patents were approved, including a Japanese patent in the Snapshot® family and US patents in the DFU family, the Snapshot family, the MSI amputation site analysis/tissue classification family, and the original MSI Photoplethysmography (PPG) tissue classification family.

Furthermore, during the period Spectral MD has completed validation of trademark registrations across all future major commercial markets.

R&D Pipeline Strategy

During 2022, the Company has begun to further assess other disease indications for DeepView™, leveraging its AI data pipeline infrastructure developed for the Burn and DFU clinical indications. Spectral MD’s AI data pipeline infrastructure is one of the key company assets developed and refined over 10+ years of AI development, and it enables the Company to develop AI for additional clinical indications faster and more cost-efficiently than the original two Burn and DFU clinical indications; it is designed for large scale, i.e., large data volumes from a plurality of clinical sites, and seamless integration of DeepView™ imaging data with corresponding patient clinical data to drive AI training.

Additional analysis will result in an expanded and prioritized roadmap of future commercial opportunities building on the universal imaging platform to include innovative technologies such as AI-3D Wound Measurement, AI-Venous Leg Ulcer (“VLU”) indication, AI-Critical Limb Ischemia (“CLI”) indication, AI-Digital Health, AI-Guided Therapy, and AI-Cosmetics. More specifically, DeepView™'s 3D Wound Measurement patent-pending technology will offer physicians millimetric level wound size measurement accuracy with single image acquisition and without requiring external reference markers for seamless integration into the clinical workflow. Plurality of indications is an important criterion in BARDA’s evaluation of potential commercial contracts. The Company will continue to evaluate and investigate its data commercialization strategy, further expand its database of proprietary and clinically validated wound data points and continue to work towards assessing additional monetary value of this dataset.

Financial Review

Revenue of US$ 25.4 million represents research and development revenue in 2022. This is the result of the realization of non-dilutive research and development contracts with BARDA and DHA (2021: US$ 15.2 million). This 67% increase versus 2021 arises from the increase in research and development activities for the DeepViewTM AI-Burn indication and the handheld prototype DeepView SnapShot®M.

The cost of sales in 2022 was US$ 14.5 million (2021: US$ 8.2 million) and gross profit was US$ 10.9 million (2021: US$ 7.0 million). This is entirely associated with BARDA research and development contract activities, invoiced to BARDA monthly.

During 2022, operating expenses increased US$ 2.2 million year over year to US$ 13.5 million (2021: US$ 11.3 million). This is predominantly driven by the DeepViewTM AI-DFU indication development, and by scaling up the organizational infrastructure to support near term commercialization.

During 2022, the operating loss was US$ (2.6) million (2021: loss of US$ (4.2) million). During 2022, adjusted EBITDA was a loss of US$ (1.5) million (2021: loss of US$ (2.8) million).

Cash and cash equivalents totaled US$ 14.2 million at the end of 2022 (2021: US$ 16.1 million). The 2022 cash figure represents a strong working capital performance, as management has made permanent improvements in the accounts receivable cycle.

Notes Payable totaled US$ 0.2 million at the end of 2022 (2021: US$ 0.6 million). During 2022, the Company repaid the remaining balance of a promissory note entered in 2020 with JPMorgan Chase Bank, N.A., as lender, pursuant to the Paycheck Protection Program (“PPP”) of the US government COVID-19 small business stimulus.

In conjunction with the closing of Company’s initial public offering on the AIM market in 2021, the Company issued 762,712 warrants, with a strike price of US$ 0.89 and a five-year life, to SP Angel, who acts as nominated advisor and joint broker to the Company. As of 31 December 2022, the strike price was US$ 0.71. The change in the strike price is due to the change in exchange rates as the warrants will settle in shares denominated in British Pounds. The fair value was calculated to be US$ 0.1 million at the end of 2022 (2021: US$ 0.2 million).

Effective 1 January 2022, the Company accounts for its leases under Accounting Standards Codification (“ASC”) 842, Leases. Under this guidance, arrangements meeting the definition of a lease are classified as operating or financing leases and are recorded in the condensed consolidated balance sheets as both a right of use asset and a lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company’s incremental borrowing rate. See additional discussion regarding lease accounting in the Consolidated Financial Statements and Footnotes.

Following the first anniversary of the Company’s admission to the AIM market, the ‘Regulation S’ market trading restrictions were removed from the shares of common stock, saved for those held by certain controlling shareholder thus enabling wider market access to acquire and sell stock via multiple trading platforms. Additionally, the removal of the charter restriction on the Spangenberg entities’ acquisition of certain further shares announced on 7 July 2022 provides further sources of potential market liquidity.

Closing Statements

We continue to demonstrate that Spectral MD’s technology has the potential to be of tremendous benefit to patients and a powerful new tool for clinicians in distinguishing between damaged and healthy human tissue invisible to the naked eye, providing ‘Day One’ healing assessments for burn wounds and DFU. We believe DeepView™ is a market leading technology, supported by the largest known burn wound database in the US, and has the potential to disrupt current treatment pathways, improving the standard of care for many patients across multiple geographical markets and applications. We remain confident in our strategic approach and that our transformative technology is well positioned ahead of regulatory submissions planned in 2023.



Wensheng Fan
Chief Executive Officer
27 February 2023



Risk Management

The Company continues to assess, monitor, and mitigate the risks in the business. The principal risks, and the current assessment of the risk status and mitigation effectiveness are listed in the table below.


RiskDescriptionRisk StatusMitigationMitigation Effectiveness
BARDA Burn development is heavily dependent on BARDA funding Unchanged Maintaining strong relationships and project focus Effective – BARDA awarded an expansion of Option 1B in August 2022. Federal contract opportunity initiated for Health and Human Services Burn Wound Imaging technology. Company responded with proposal and will be evaluated for contract fulfillment.
DHA Development of a handheld device is reliant on funding Unchanged Maintaining strong relationships and project focus Effective – entered Phase II contract in June 2021
Loss of a major customer No commercial sales have been made, almost all revenue from fixed fees
and costs payable by BARDA
Unchanged Maintaining a strong relationship with BARDA and expect diversification of customers in future years following commercialization Effective – BARDA awarded an expansion of Option 1B in August 2022. Federal contract opportunity initiated for Health and Human Services Burn Wound Imaging technology. Company responded with proposal and will be evaluated for contract fulfillment.
Commercial The DeepView® system has yet to be launched into the US., UK, EU and other markets and so adoption and market penetration can only be estimated Unchanged Maintaining strong relationships and project focus Effective – Increased marketing team by two product managers (US & UK). Outlined evidence needed in US & UK to support claims post regulatory approval and securing physicians to run case studies.
Research and development Complex scientific research is necessary in the life sciences and medical device development sector Unchanged Recruiting and retaining highly skilled employees Effective – hired 16 new employees with world leading capabilities in 2022
Product development timelines Unpredictability of the rate of patient recruitment into clinical trials Unchanged Maintaining strong relationships and project focus Effective – on schedule with trials
Regulatory approvals and compliance Obtain various regulatory approvals (including the FDA and EMA approvals) Unchanged Conducting thorough clinical and product market research and maintaining strong relationships with regulatory authorities Effective – engaged in regular discussion to update FDA and established partnerships with world leading expert teams of scientific and regulatory affairs staff.
Technological change Changing customer requirements and the introduction of products or services or enhancements embodying new technology Unchanged Continues to invest in technical developments and apply for patents Effective – issued additional patents in 2022



Non-GAAP measures as defined by the Company 

The Company uses adjusted EBITDA as a non-GAAP metric when measuring performance, including when measuring current period results against prior periods adjusted EBITDA.

Because of their non-standardized definitions, non-GAAP measures (unlike GAAP measures) may not be comparable to the calculation of similar measures of other companies. Supplemental non-GAAP measures are presented solely to permit investors to more fully understand how Spectral MD management assesses underlying performance. Supplemental non-GAAP measures are not, and should not be viewed as, a substitute for GAAP measures.

Adjusted EBITDA

The Company defines adjusted earnings before interest, tax, depreciation and amortization ("adjusted EBITDA") as net income/(loss) excluding income taxes, depreciation of property, plant and equipment (including any related impairment charges), amortization of intangible assets (including any related impairment charges), interest expense, stock compensation, any non-operating financial income and expense.

The following table presents the Company’s Adjusted EBITDA as of December 31, 2022 and December 31, 2021:


 2022 2021
 US$ US$
Net loss (2,912)(3,988)
   Depreciation Expense 111
   Provision for Income Taxes 106(98)
   Interest Expense 1217
EBITDA (2,783)(4,068)
Additional Adjustments:   
   Stock based Compensation 1,1551,365
   Change in fair value of warrant liability (57)(298)
   Foreign exchange transaction loss 253188
   Other income (49)-
Adjusted EBITDA (1,481)(2,813)



Independent Auditors Report

To the Stockholders and Board of Directors Spectral MD Holdings, Ltd:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Spectral MD Holdings, Ltd and its subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, changes in equity, and cash flows for each of the years in the two-year period ended December 31, 2022, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for leasing transactions as of January 1, 2022 due to the adoption of Accounting Standards Codification 842, Leases.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.




We have served as the Company’s auditor since 2021.

Dallas, Texas February 24, 2023



Consolidated Balance Sheets
For the year ended 31 December 2022, and 2021
(in thousands, except share and per share data)

Current assets:  
Cash and cash equivalents 14,17416,121
Accounts receivable, net 2,2941,435
Unbilled revenue 61871
Prepaid expenses and other current assets 601840
Total current assets17,68718,467
Non-current assets:
Property and equipment, net 21 32
Right-of-use assets 1,008 -
Other noncurrent assets 40
Total Assets18,71618,539
Liabilities and stockholders' equity
Current liabilities:  
Accounts payable 2,7591,414
Accrued expenses 2,6312,603
Lease liabilities, short-term 680
Notes payable 175583
Warrant liability 129186
Total current liabilities6,3744,786
Lease liabilities, long-term 346 
Total Liabilities 6,7204,786
Commitments and contingencies (Note 8)   
Stockholders' Equity  
Common stock (US$0.001 par value); 400,000,000 shares authorized;   
135,409,564 and 135,034,564 shares issued and outstanding as of   
December 31, 2022 and 2021, respectively 135135
Additional paid-in capital 23,79522,640
Accumulated deficit (11,934) (9,022)
Total Stockholders' equity11,99613,753
Total Liabilities and Stockholders' Equity18,71618,539


See accompanying notes to the consolidated financial statements



Consolidated Statement of Operations
For the year ended 31 December 2022, and 2021
(in thousands, except share and per share data)

Research and development revenue 25,36815,239
Cost of revenue (14,531)(8,187)
Gross profit10,8377,052
Operating costs and expenses:
General and administrative
Total operating costs and expenses13,48411,231
Operating income (loss)(2,647)(4,179)
Other income (expense):
Interest expense (12)  (17)
Change in fair value of warrant liability 57298
Foreign exchange transaction loss (253)(188)
Other income 49-
Total other income (expense)(159)93
(Loss) income before income taxes(2,806)(4,086)
Benefit (provision) for income taxes (106)98
Net (loss) income(2,912)(3,988)
Dividend on Series A preferred stock (1,259)
Net loss attributable to common stockholders (2,912)(5,247)
Net (loss) income per share of common stock Basic and Diluted  

Weighted average common shares outstanding Basic and Diluted  


See accompanying notes to the consolidated financial statements



Consolidated Statements of Changes in Equity
For the year ended 31 December 2022, and 2021
(In thousands, except share data)

 Preferred StockCommon StockAdditional
Paid-in Capital
Total Stockholders'



Balance at December 31, 20204,324,330 1,114 61,347,000 61 6,096 (5,034) 1,123
Issuance of common stock for cash  19,067,797 19 15,595 15,614
Issuance cost, net of $0.5 million warrant liability  –  (1,479) (1,479)
Cumulative dividend on Series A preferred stock 1,259(1,259) (1,259)
Conversion of preferred stock to common cash    (4,324,330) (2,373) 53,889,765 54 2,319 2,373
Stock options exercised for cash 42,500 4 4
Stock-based compensation   687,502 1 1,364 1,365
Net loss (3,988) (3,988)
Balance at December 31, 2021135,034,56413522,640(9,022)13,753
Stock-based compensation 375,000 1,1551,155
Net loss (2,912)     (2,912)
Balance at December 31, 2022 135,409,564 135 23,795 (11,934) 11,996


See accompanying notes to the consolidated financial statements



Consolidated Statements of Cash Flows
For the year ended 31 December 2022, and 2021
(in thousands)

Cash flows from operating activities:
Net (loss) income
Adjustments to reconcile net (loss) income to net cash (used in) provided by
operating activities:   
   Depreciation expense 111
   Stock based compensation 1,1551,365
   Amortization of right-of-use assets 557
   Change in fair value of warrant liability (57)(298)
Changes in operating assets and liabilities:   
   Accounts receivable (859)1,256
   Unbilled revenue (547)(71)
   Prepaid expenses and other current assets 615(257)
   Other assets 40(9)
   Accounts payable 1,345(2,398)
   Accrued expenses 511,481)
   Lease liabilities (561)
Net cash (used in) provided by operating activities (1,162)(2,918)
Cash flows from investing activity:
Purchases of property and equipment (7)
Net cash (used in) provided by investing activity (7)
Cash flows from financing activities:  
Proceeds from issuance of common stock and warrant, net of issuance costs 14,618
Proceeds from stock option exercise 4
Payments for notes payable (785)(701)
   Net cash (used in) provided by financing activities (785)13,921
Net increase (decrease) in cash and cash equivalents (1,947)10,996
Cash and cash equivalents, beginning of period 16,121 5,125
Cash and cash equivalents, end of period 14,17416,121
Supplemental cash flow information:  
Cash paid for interest 2312
Cash paid for income taxes 255
Noncash operating and financing activities disclosure:  
Cumulative dividend on Series A preferred stock 1,259
Conversion of preferred stock to common stock 2,373
Prepaid asset acquired for debt 376474
Software and prepaid software maintenance acquired for debt 41


See accompanying notes to the consolidated financial statements