SEC Filing | Acutus Medical, Inc.

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afib-10q_20210331.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 March 31, 2021

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

For the transition period from to

Commission File Number 001-39430

ACUTUS MEDICAL, INC.

(Exact name of registrant as specified in its charter)


Delaware	45-1306615
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2210 Faraday Ave., Suite 100, Carlsbad, CA	92008
(Address of principal executive offices)	(Zip Code)

(Registrant’s telephone number, including area code) (442) 232-6080

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

Title of each class

Trading

Symbol

Name of each exchange on which registered

Common Stock, par value $0.001 per share

AFIB

The Nasdaq Stock Market LLC

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, if any, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) 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 definition 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 registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.

Class of Common Stock		Outstanding Shares as of May 10, 2021
Common Stock, $0.001 par value		28,124,057

Acutus Medical, Inc.

Form 10-Q

For the Quarter Ended March 31, 2021

Table of Contents


		Page
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	1

	Condensed Consolidated Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020	1

	Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2021 and 2020 (unaudited)	2

	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the three months ended March 31, 2021 and 2020 (unaudited)	3

	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020 (unaudited)	4

	Notes to Condensed Consolidated Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of the Results of Operations	26

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	36

Item 4.	Controls and Procedures	37

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	38

Item 1A.	Risk Factors	38

Item 2.	Recent Sales of Unregistered Securities	38

Item 6.	Exhibits	39

Signatures		40

Item 1. Financial Statements.

Acutus Medical, Inc.

Condensed Consolidated Balance Sheets

	March 31,			December 31,
	2021			2020
(in thousands, except share and per share amounts)	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	8,631		$	25,234
Marketable securities, short-term		86,888			105,839
Restricted cash		150			150
Accounts receivable		2,477			2,160
Inventory		13,837			12,958
Prepaid expenses and other current assets		4,124			5,047
Total current assets		116,107			151,388

Marketable securities, long-term		11,225			8,726
Property and equipment, net		14,648			12,356
Right-of-use assets, net		1,480			1,669
Intangible assets, net		5,493			5,653
Goodwill		12,026			12,026
Other assets		967			717
Total assets	$	161,946		$	192,535

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	6,108		$	8,266
Accrued liabilities		8,808			7,308
Contingent consideration, short-term		2,600			5,400
Operating lease liabilities, short-term		955			933
Total current liabilities		18,471			21,907

Operating lease liabilities, long-term		875			1,134
Long-term debt		39,339			39,011
Contingent consideration, long-term		3,000			3,900
Total liabilities		61,685			65,952
Commitments and contingencies (Note 12)


Stockholders' equity
Preferred stock, $0.001 par value; 5,000,000 shares authorized as of March 31, 2021 and December 31, 2020; no shares issued and outstanding as of March 31, 2021 and December 31, 2020		—			—
Common stock, $0.001 par value; 260,000,000 shares authorized as of March 31, 2021 and December 31, 2020; 28,113,165 and 27,991,425 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively		28			28
Additional paid-in capital		490,369			487,290
Accumulated deficit		(390,196	)		(361,015	)
Accumulated other comprehensive income		60			280
Total stockholders' equity		100,261			126,583
Total liabilities and stockholders' equity	$	161,946		$	192,535

The accompanying notes are an integral part of these condensed consolidated financial statements.

Acutus Medical, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

	Three Months Ended March 31,
	2021			2020
(in thousands, except share and per share amounts)	(unaudited)
Revenue	$	3,591		$	1,583

Costs and operating expenses:
Cost of products sold		6,955			3,194
Research and development		9,370			7,973
Selling, general and administrative		16,252			10,235
Change in fair value of contingent consideration		(1,153	)		(2,219	)
Total costs and operating expenses		31,424			19,183
Loss from operations		(27,833	)		(17,600	)

Other income (expense):
Change in fair value of warrant liability		—			581
Interest income		40			275
Interest expense		(1,388	)		(1,354	)
Total other expense, net		(1,348	)		(498	)
Loss before income taxes		(29,181	)		(18,098	)
Income tax benefit		—			—
Net loss	$	(29,181	)	$	(18,098	)

Other comprehensive income (loss)
Unrealized gain (loss) on marketable securities		6			(27	)
Foreign currency translation adjustment		(226	)		(27	)
Comprehensive loss	$	(29,401	)	$	(18,152	)

Net loss per common share, basic and diluted	$	(1.04	)	$	(25.84	)
Weighted average shares outstanding, basic and diluted		28,031,686			700,505

The accompanying notes are an integral part of these condensed consolidated financial statements.

Acutus Medical, Inc.

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)

For the Three Months Ended March 31, 2021

										Accumulated
(in thousands, except share amounts)	Common Stock				Additional Paid-in		Accumulated			Other Comprehensive			Total Stockholders'
	Shares		Amount		Capital		Deficit			Income (Loss)			Equity
Balance as of December 31, 2020		27,991,425	$	28	$	487,290	$	(361,015	)	$	280		$	126,583
Unrealized gain on marketable securities		—		—		—		—			6			6
Foreign currency translation adjustment		—		—		—		—			(226	)		(226	)
Stock option exercises		27,509		—		169		—			—			169
Stock-based compensation		94,231		—		2,910		—			—			2,910
Net loss		—		—		—		(29,181	)		—			(29,181	)
Balance as of March 31, 2021 (unaudited)		28,113,165	$	28	$	490,369	$	(390,196	)	$	60		$	100,261

For the Three Months Ended March 31, 2020

	Series A				Series B				Series C				Series D													Accumulated
(in thousands, except share amounts)	Convertible Preferred Stock				Convertible Preferred Stock				Convertible Preferred Stock				Convertible Preferred Stock				Common Stock				Additional Paid-in		Accumulated			Other Comprehensive			Total Stockholders'
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Income (Loss)			(Deficit)
Balance as of December 31, 2019		391,210	$	3,059		3,088,444	$	40,685		4,499,921	$	74,575		8,200,297	$	135,039		695,902	$	1	$	33,252	$	(259,034	)	$	(30	)	$	(225,811	)
Unrealized loss on marketable securities		—		—		—		—		—		—		—		—		—		—		—		—			(27	)		(27	)
Foreign currency translation adjustment		—		—		—		—		—		—		—		—		—		—		—		—			(27	)		(27	)
Issuance of Series D convertible preferred stock for the Biotronik Asset Purchase		—		—		—		—		—		—		273,070		5,000		—		—		—		—			—			—
Issuance of Series D convertible preferred stock for the contingent consideration related to the Rhythm Xience Acquisition		—		—		—		—		—		—		119,993		2,197		—		—		—		—			—			—
Stock-based compensation		—		—		—		—		—		—		—		—		14,962		—		1,741		—			—			1,741
Net loss		—		—		—		—		—		—		—		—		—		—		—		(18,098	)		—			(18,098	)
Balance as of March 31, 2020 (unaudited)		391,210	$	3,059		3,088,444	$	40,685		4,499,921	$	74,575		8,593,360	$	142,236		710,864	$	1	$	34,993	$	(277,132	)	$	(84	)	$	(242,222	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

Acutus Medical, Inc.

Condensed Consolidated Statements of Cash Flows

	Three Months Ended March 31,
	2021			2020
(in thousands)	(unaudited)
Cash flows from operating activities
Net loss	$	(29,181	)	$	(18,098	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		1,241			429
Amortization of intangible assets		160			110
Stock-based compensation expense		2,910			1,741
Amortization of premiums/(accretion of discounts) on marketable securities, net		412			(5	)
Amortization of debt issuance costs		328			154
Amortization of right-of-use assets		180			169
Change in fair value of warrant liability		—			(581	)
Change in fair value of contingent consideration		(1,153	)		(2,219	)
Changes in operating assets and liabilities:
Accounts receivable		(317	)		(708	)
Inventory		(879	)		(1,809	)
Prepaid expenses and other current assets		1,104			214
Other assets		(250	)		(267	)
Accounts payable		(2,091	)		3,602
Accrued liabilities		1,500			(83	)
Operating lease liabilities		(237	)		(207	)
Net cash used in operating activities		(26,273	)		(17,558	)

Cash flows from investing activities
Purchases of available-for-sale marketable securities		(9,135	)		—
Sales of available-for-sale marketable securities		—			8,100
Maturities of available-for-sale marketable securities		25,000			25,300
Purchases of property and equipment		(3,693	)		(1,683	)
Net cash provided by investing activities		12,172			31,717

Cash flows from financing activities
Payment of contingent consideration		(2,547	)		(2,584	)
Proceeds from stock options exercises		169			—
Net cash used in financing activities		(2,378	)		(2,584	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(124	)		(27	)
Net change in cash, cash equivalents and restricted cash		(16,603	)