The Company has experienced net losses and negative cash flows from operations each period since its inception. Through March 31, 2022, the Company had an accumulated deficit of approximately $137.6 million. The Company's net loss was approximately $6.0 million and $5.0million for the three-month periods ended March 31, 2022 and 2021, respectively.

The Company has been engaged in developing LYPDISO (formerly MAT9001) as well as its lipid nanocrystal ("LNC") platform delivery technology and a pipeline of associated product candidates, including MAT2203 and MAT2501, since 2011. To date, the Company has not obtained regulatory approval for any of its product candidates nor generated any revenue from product sales, and the Company expects to incur significant expenses to complete development of its product candidates. The Company may never be able to obtain regulatory approval for the marketing of any of its product candidates in any indication in the United States or internationally and there can be no assurance that the Company will generate revenues or ever achieve profitability.

If the Company obtains Food and Drug Administration ("FDA") approval for one or more of its product candidates, the Company expects that its expenses will continue to increase once the Company reaches commercial launch. The Company also expects that its research and development expenses will continue to increase as it moves forward with additional clinical studies for its current product candidates and development of additional product candidates. As a result, the Company expects to continue to incur substantial losses for the foreseeable future, and that these losses will be increasing.

As of March 31, 2022, the Company had cash and cash equivalents of approximately $19.3 million, marketable securities of approximately $24.5million and restricted cash of approximately $0.3 million. The Company believes the cash and cash equivalents and marketable securities on hand are sufficient to fund planned operations through 2023.

Note 3 - Summary of Significant Accounting Policies

Basis of presentation and principles of consolidation

The accompanying unaudited condensed consolidated financial statements include the consolidated accounts of Holdings and its wholly owned subsidiaries, BioPharma, and Nanotechnologies. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and reflect the operations of the Company and its wholly owned subsidiaries. All intercompany transactions have been eliminated in consolidation.

The Company's significant accounting policies are described in Note 3 within the Company's Notes to Consolidated Financial Statements included in the Company's 2021 Form 10-K.

The Company's management has considered all recent accounting pronouncements issued and believes that these recent pronouncements will not have a material effect on the Company's financial statements.

COVID-19

Since its emergence in 2019, COVID-19 has continued to spread and has adversely affected workforces, economies, and financial markets globally, and has and may continue to cause economic downturns.



5

The financial results for the three months ended March 31, 2022 were not significantly impacted by COVID-19. However, the Company cannot predict the impact of the progression of COVID-19 on future results or the Company's ability to raise capital due to a variety of factors, including but not limited to the continued good health of Company employees, the ability of suppliers to continue to operate and deliver, the ability of the Company to maintain operations, and any further government and/or public actions taken in response to COVID-19.

Note 4 - Cash, Cash Equivalents, Restricted Cash and Marketable Securities

The Company considers all highly liquid financial instruments with original maturities of three months or less when purchased to be cash and cash equivalents and all investments with maturities of greater than three months from date of purchase are classified as marketable securities. Cash and cash equivalents consisted of cash in bank checking and savings accounts, money market funds and short-term U.S. treasury bonds that mature within three months of settlement date.

Cash, Cash Equivalents and Restricted Cash

The Company presents restricted cash with cash and cash equivalents in the Condensed Consolidated Statements of Cash Flows. Restricted cash at both March 31, 2022 and December 31, 2021 of approximately $250 thousand represents funds the Company is required to set aside as collateral primarily for the Company's lab operating lease and other purposes.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Condensed Consolidated Balance Sheets to the total of the amounts in the Condensed Consolidated Statements of Cash Flows as of March 31, 2022, December 31, 2021, March 31, 2021 and December 31, 2020:

Schedule of Cash, Cash Equivalents and Restricted Cash

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