U.S. STEM CELL, INC.
The following is management's discussion and analysis ("MD&A") of certain
significant factors that have affected our financial position and operating
results during the periods included in the accompanying financial statements, as
well as information relating to the plans of our current management. This report
includes forward-looking statements. Generally, the words "believes,"
"anticipates," "may," "will," "should," "expect," "intend," "estimate,"
"continue," and similar expressions or the negative thereof or comparable
terminology are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties, including the matters set forth
in this report or other reports or documents we file with the Securities and
Exchange Commission from time to time, which could cause actual results or
outcomes to differ materially from those projected. Undue reliance should not be
placed on these forward-looking statements which speak only as of the date
hereof. We undertake no obligation to update these forward-looking statements.
The following discussion and analysis should be read in conjunction with our financial statements and the related notes thereto and other financial information contained elsewhere in this Form 10-K
The Company's MD&A is comprised of significant accounting estimates made in the normal course of its operations, overview of the Company's business conditions, results of operations, liquidity and capital resources and contractual obligations. The Company did not have any off balance sheet arrangements as ofDecember 31, 2021 or 2020. The discussion and analysis of the Company's financial condition and results of operations is based upon its financial statements, which have been prepared in accordance with generally accepted accounting principles generally accepted inthe United States (or "GAAP"). The preparation of those financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities at the date of its financial statements. Actual results may differ from these estimates under different assumptions or conditions.
Our Ability To Continue as a Going Concern
Our management has evaluated whether there is substantial doubt about our ability to continue as a going concern and has determined that substantial doubt existed as of the date of the end of the period covered by this Annual Report on Form 10-K (the "Form 10-K"). This determination was based on the following factors, as ofDecember 31, 2021 , the Company had cash on hand of$39,393 and a working capital deficit (current liabilities in excess of current assets) of$11,987,776 . During the year endedDecember 31, 2021 , the net loss was$3,287,416 and net cash used in operating activities was$1,057,939 . The Company's existence is dependent upon management's ability to develop profitable operations and to obtain additional funding sources. There can be no assurance that ourfinancing efforts will result in profitable operations or the resolution of the Company's liquidity problems. The accompanying statements do not include any adjustments that might result should the Company be unable to continue as a going concern. Along with diversifying the portfolio of products distributed by the Company, including equipment and biologics, it is the intention of our management to both continue to adhere to the Court Order (see Note 12 of the Financial Statements) as well as re-establish its good standing with the Agency (FDA). These points are not mutually exclusive nor negotiable and management believes that there are still business and patient goodness opportunities while still abiding by all legal requirements As a result, management shall be continuing with the development ofUS Stem Cell Training, Inc. , an operating division of the Company, that is a content developer of regenerative medicine/cell therapy informational and training materials for physicians and patients and complies with both requirements--as well as Vetbiologics, an operating division of the Company, that is a veterinary regenerative medicine company committed to providing veterinarians with the ability to deliver the highest quality regenerative medicine therapies to dogs, cats and horses. Overview We are a biotechnology company focused on the discovery, development and, subject to regulatory approval, commercialization of autologous cell therapies for the treatment of chronic and acute heart damage. Our lead product candidates are MyoCell™ and Adipocell. MyoCell™ is an innovative clinical therapy designed to populate regions of scar tissue within a patient's heart with autologous muscle cells, or cells from a patient's body, for the purpose of improving cardiac function in chronic heart failure patients. Adipocell is an innovative cell therapy kit with multiple possible treatment applications using autologous adipose cells. We are presently investigating the use of adipose cells in a variety of clinical applications. 17
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Biotechnology Product Candidates
We are focused on the discovery, development and, subject to regulatory approval, commercialization of autologous cell therapies for the treatment of chronic and acute heart damage. In our pipeline, we have multiple product Candidates for the treatment of heart damage, including MyoCell, MyoCell™ SDF-1 and Adipocell. MyoCell™ and MyoCell™ SDF-1 are clinical muscle-derived cell therapies designed to populate regions of scar tissue within a patient's heart with new living cells for the purpose of improving cardiac function in chronic heart failure patients. MyoCell™ SDF-1 is intended to be an improvement to MyoCell™. MyoCell™ SDF-1 is similar to MyoCell™ except that the myoblast cells to be injected for use in MyoCell™ SDF-1 will be modified prior to injection by an adenovirus vector or non-viral vector so that they will release extra quantities of the SDF-1 protein, which expresses angiogenic factors. Adipocell is a kit to obtain patient-derived cells proposed for various in clinic procedures. We hope to demonstrate that these product candidates are safe and effective complements to existing therapies for various indications. MyoCath Product Candidate The MyoCath is a deflecting tip needle injection catheter that has a larger (25 gauge) needle to allow for better flow rates and less leakage than systems that are 27 gauge. This larger needle allows for thicker compositions to be injected, which helps with cell retention in the heart. Also, the MyoCath needle has more fluoroscopic brightness than the normally used nitinol needle, enabling superior visualization during the procedure. Seeing the needle well during injections enables the physician who is operating the catheter to pinpoint targeted areas more precisely. The MyoCath is used to inject cells into cardiac tissue in therapeutic procedures to treat chronic heart ischemia and congestive heart failure. Investigators in our MARVEL Trial may use either our MyoCath catheters orBiosense Webster's (a Johnson & Johnson company) NOGA® Cardiac Navigation System along with the MyoStar™ injection catheter for the delivery of MyoCell™ to patients enrolled in the trial. This trial has not been enrolling in 2021. We conduct operations in one business segment. We may organize our business into more discrete business units when and if we generate significant revenue from the sale of our product candidates. Our revenue since inception has been generated inside and outsidethe United States , and the majority of our long-lived assets are located inthe United States .
GENERAL
OnMarch 3, 2017 , we entered into an asset sale and lease agreement (sale/leaseback transaction; "Asset Sale and Lease Agreement"), with GACP (General American Capital Partners )Stem Cell Bank LLC , aFlorida limited liability company ("GACP) whereby we sold certain lab, medical and other equipment relating to the cell banking business for$400,000 and leased back the sold equipment over a three year term. The lease includes a base monthly rental payment of$20,000 , due the first day of each calendar month. In addition, we are required to pay 2.3%, 22.5% and 31.6% of revenues collected on deposits arising from cell banking business for years 1, 2 and 3, respectively. At the expiration of the lease, we returned all leased equipment and along with any maintenance records, logs, etc. in our possession to the lessor with no right of repurchase. Further, as a consequence of the Court Order , the Company resolved to divest itself of certain equipment and other assets (the "Equipment Assets") used in connection with the Company's human tissue banking business, but consistent however with the requirements of the Court Order, and to adjust the business plan and operations to accommodate this potential divesture. The divestiture became effectiveOctober 10th, 2019 .U.S. Stem Cell Clinic, LLC OnFebruary 10, 2021 , as part of a settlement agreement, the Company transferred its entire member interest inU.S. Stem Cell Clinic, LLC to Dr.Kristen Comella as settlement for$100,000 of accrued interest owed toDr. Comella . 18
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Results of Operations Overview
Comparison of Years Ended
Revenues Our primary source of revenue is from the sale of test kits and equipment, training services, patient treatments and laboratory services, and cell banking. Our revenue may vary substantially from quarter to quarter and from year to year. We believe that period-to-period comparisons of our results of operations are not meaningful and should not be relied upon as indicative of our future performance. We do not expect to generate substantial revenues until we obtain regulatory approval for and commercialize our product candidates. We recognized revenues of$200,749 in 2021 compared to revenues of$277,087 in 2020. Our revenue in 2021 was generated from the sale of test kits and equipment and training services. Our revenues for 2020 were generated from the sale, test kits and equipment, and training services. Decrease in revenue due to court case result. As a consequence of the Court Order (see Note 12) the Company divested itself of certain equipment and other assets (the "Equipment Assets") used in connection with the Company's human tissue banking business, but consistent however with the requirements of the Court Order, and adjusted the business plan and operations to accommodate this divesture. Cost of Sales
Cost of sales consists of the costs associated with the production of MyoCath and test kits, product costs, labor for production and training and lab and banking costs consistent with products and services provided.
Cost of sales was
Research and Development Our research and development expenses consist of costs incurred in identifying, developing and testing our product candidates. These expenses consist primarily of costs related to our clinical trials, the acquisition of intellectual property licenses and preclinical studies. We expense research and development costs as incurred.
Research and development expenses were
Selling, General and Administrative
Our selling, general and administrative expenses primarily consist of the costs associated with our general management and clinical marketing and trade programs, including, but not limited to, salaries and related expenses for executive, administrative and marketing personnel, rent, insurance, legal and accounting fees, consulting fees, travel and entertainment expenses, conference costs and other clinical marketing and trade program expenses. Selling, general and administrative expenses were$2,284,577 in 2021, a decrease of$328,634 in selling, general and administrative expenses of$2,613,211 in 2020. The decrease is due to reduced operations due to the Court order.
Gain (loss) on settlement of debt
During the year endedDecember 31, 2021 , we recognized a net loss of$151,410 primarily related to interest. In 2020, we recognized a gain of$182 primarily related to the settlement of accounts payable and accrued interest. Gain on sale of equipment InMarch 2017 , we entered a sale/leaseback transaction whereby we sold our lab and other medical equipment and re-leased the equipment back for 36 months. In connection with the sale/leaseback, we realized a gain on sale of equipment of$0 . During the year endedDecember 31, 2021 , we recognized$0 in current period operations as compared to$21,474 for the previous year. 19
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Index Income from equity investment Our investment of a 49.9% member interest ownership ofRegenerative Wellness Clinic as well as a 49% interest inU.S. Stem Cell Clinic of theVillages LLC are accounted for using the equity method of accounting. As such, we report our pro rata share of income (loss) from equity investments for the period. For the year endedDecember 31, 2021 and 2020 our pro rata share of income (loss) was$0 and$(23,539) , respectively. We divested ourselves of our member interests inRegenerative Wellness Clinic, LLC inMarch 2021 . Interest Expense Interest expense during the year endedDecember 31, 2021 was$1,000,148 compared to$488,369 for the year endedDecember 31, 2020 . Interest expense primarily consists of interest incurred on the principal amount of theNorthstar loan, theSeaside National Bank loan, the Capital Lease with GACP, accrued fees and interest payable to the Guarantors, imputed interest on non-interest bearing debt, the amortization of debt discounts and non-cash interest incurred relating to our issued convertible notes payable. There was nominal change in interest year over year. OnJanuary 3, 2018 , we renewed the loan withSeaside National Bank and Trust extend the maturity date toMay 18, 2020 all other terms and conditions remain unchanged. OnMay 18, 2020 , the Seaside loan was turned into a Demand Note with no fixed maturity date but with a re-documentation requirement every four years. The new re-documentation deadline isMay 2022 . Stock-Based Compensation Stock-based compensation which is included in the Selling, General and Administrative above, reflects our recognition as an expense of the value of stock options and other equity instruments issued to our employees and non-employees over the vesting period of the options and other equity instruments. We have granted to our employees options to purchase shares of common stock at exercise prices as determined by our Board of Directors, with input from management.
In valuing our common stock, our Board of Directors considered a number of factors, including, but not limited to:
? our financial position and historical financial performance; ? the illiquidity of our capital stock; ? arm's length sales of our common stock; ? the development status of our product candidates; ? the business risks we face; ? vesting restrictions imposed upon the equity awards; ? an evaluation and benchmark of our competitors; and ? the prospects of a liquidity event. OnApril 1, 2013 , our Board of Directors approved, subject to subsequently received shareholder approval, the establishment of the Bioheart 2013 Omnibus Equity Compensation Plan, or the "2013 Omnibus Plan" (replacing the 1999 Officers and Employees Stock Option Plan, or the Employee Plan, and the 1999 Directors and Consultants Stock Option Plan). The 2013 Omnibus Plan initially reserved up to fifty thousand (50,000) shares of common stock for issuance. OnAugust 4, 2014 , the Board of Directors approved to set the reserve to one hundred thousand (100,000) shares of common stock for issuance and to close the 1999 Officers and Employees Stock Option Plan. OnFebruary 2, 2015 , at the annual meeting of shareholders, the majority of shareholders approved the 2013 Omnibus Equity Compensation Plan. OnNovember 2, 2015 , the Board of Directors approved the increase of the reserve under the 2013 Omnibus Plan to five hundred million (500,000,000) shares of common stock for issuance, effectiveSeptember 16, 2016 , approved an addition of twenty five million (25,000,000) shares of common stock to the reserve, effectiveApril 21, 2017 , approved an addition of twenty five million (25,000,000) shares of common stock to the reserve, effectiveAugust 7, 2017 , approved an addition of thirty million (30,000,000) shares of common stock to the reserve and effectiveMay 7, 2018 , approved an addition of one hundred million (100,000,000) shares of common stock to reserve. 20
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A summary of options atDecember 31, 2021 and activity during the year then ended is presented below: Weighted- Average Weighted- Remaining Average Contractual Shares Exercise Price Term (in years) Options outstanding at December 31, 2020 111,119,914$ 0.0247 7.2 Granted - Exercised - Forfeited/Expired (476,030 )$ 0.0298
Options outstanding at
6.3
Options exercisable at
6.1
Available for grant at
The following information applies to stock options outstanding and exercisable atDecember 31, 2021 : Options Outstanding Options Exercisable Outstanding Weighted Average Exercisable Exercise Number Remaining Life Weighted
Average Number Weighted Average
Price of Options In Years Exercise price of Options Exercise price
$0.004 to $0.010 41,800,000 7.0 $ 0.0051 30,150,000 $ 0.0050
$0.011 to $0.020 16,250,000 4.7 0.0196 16,250,000 0.0196
$0.021 to $0.030 9,510,000 6.9 0.0252 9,007,500 0.0252
$0.0363 22,635,000 5.6 0.0363 22,635,000 0.0363
$0.0536 20,000,000 6.4 0.0536 15,000,000 0.0536
$0.1540 448,884 3.8 0.1540 448,884 0.1540
Total 110,643,884 6.3 $ 0.0247 93,491,384 $ 0.0256
The aggregate intrinsic value of outstanding stock options was $36,686 , based on
options with an exercise price less than the Company's stock price of $0.0060 as
of December 31, 2021 , which would have been received by the option holders had
those option holders exercised their options as of that date.
The fair value of all options that vested during the years ended December 31,
2021 and 2020 was $428,556 and $685,939 , respectively. As of December 31, 2021 ,
the Company had $157,289 of total unrecognized compensation cost related to
non-vested awards granted under the 2013 Omnibus Plan, which the Company expects
to recognize over a weighted average period of 0.55 years.
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Index Warrants A summary of warrant activity for the year endedDecember 31, 2021 is presented below: Weighted-Average Weighted-Average Number of Exercise Remaining Warrants Price Life in Years Outstanding at December 31, 2020 1,110,468 $ 12.84 7.1 Issued - Exercised - Expired (7,341 ) $ 77.88 Outstanding at December 31, 2021 1,103,127 $ 12.41 6.2 Exercisable at December 31, 2021 1,101,582 $ 1.64 6.2 The following information applies to warrants outstanding and exercisable atDecember 31, 2021 : Warrants Outstanding Warrants Exercisable Outstanding Weighted Average Weighted Average Weighted Average Exercise Number of Remaining Exercise Exercisable Number Exercise Price Warrants Life in Years Price of Warrants Price$0.03 -20.00 1,081,036 6.3 $ 1.17 1,081,036 $ 1.17$20.01 -30.00 19,543 2.2 $ 25.06 19,543 $ 25.06$49.86 1,003 2.2 $ 49.86 1,003 $ 49.86$7,690.00 $ 1,545 5.0 $ 7,690.00 - $ - 1,103,127 6.2 $ 12.41 $ 1,101,582 $ 1.64 Interest Expense Interest expense during the year endedDecember 31, 2021 was$1,000,148 compared to$488,369 for the year endedDecember 31, 2020 . Interest expense primarily consists of interest incurred on the principal amount of theNorthstar loan, theSeaside National Bank loan, the Capital Lease with GACP, accrued fees and interest payable to the Guarantors, imputed interest on non-interest bearing debt, the amortization of debt discounts and non-cash interest incurred relating to our issued convertible notes payable. There was nominal change in interest year over year. OnJanuary 3, 2018 , we renewed the loan withSeaside National Bank and Trust extend the maturity date toMay 18, 2020 all other terms and conditions remain unchanged. OnMay 18, 2020 , the Seaside loan was turned into a Demand Note with no fixed maturity date but with a re-documentation requirement every four years. The new re-documentation deadline isMay 2022 . Critical Accounting Policies Our discussion and analysis of our financial condition and results of operations is based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted inthe United States . The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. While our critical accounting policies are described in Note 1 to our financial statements appearing elsewhere in this report, we believe the following policies are important to understanding and evaluating our reported financial results: Revenue Recognition EffectiveJanuary 1, 2018 , we recognize revenue in accordance with Accounting Standards Codification 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific revenue recognition guidance throughout the Industry Topics of the Accounting Standards Codification. The updated guidance states that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also provides for additional disclosures with respect to revenues and cash flows arising from contracts with customers. 22
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At the time of each transaction, management assesses whether the fee associated with the transaction is fixed or determinable and whether or not collection is reasonably assured. The assessment of whether the fee is fixed or determinable is based upon the payment terms of the transaction. Collectability is assessed based on a number of factors, including past transaction history with the client and the creditworthiness of the client.
Our primary sources of revenue are from the sale of test kits and equipment, training services, patient treatments, laboratory services and cell banking.
Revenues for kits and equipment sold are not recorded until kits and equipment are received by the customer. Revenues from in-person trainings are recognized when the training occurs and revenues from on demand online trainings are recognized when the customer purchases the rights to the training course. Any cash received as a deposit for trainings are recorded by the Company as a liability.
Patient treatments and laboratory services revenue are recognized when those services have been completed or satisfied.
Revenues for cell banking sales are accounted for as multiple performance obligations as described in 606 and addresses accounting for arrangements that may involve the delivery or performance of multiple products, services and/or rights to use assets. Because the Company sells its services separately, on more than a limited basis and at a price within a narrow range, our company was able to allocate revenue based on stand-alone pricing. The multiple performance obligations include stem cell banking, dose retrieval and yearly storage fees. Revenues for stem cell banking and dose retrieval is recognized at the point of service and revenues for the yearly storage fees is recognized over the term of the banking contract, which is typically one year with annual renewals. Stock-based compensation We measure the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees and directors, the fair value of the award is measured on the grant date and for non-employees, the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Stock-based compensation expense is recorded by our company in the same expense classifications in the statements of operations, as if such amounts were paid in cash. Income taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss carry forwards that are available to be carried forward to future years for tax purposes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. When it is not considered to be more likely than not that a deferred tax asset will be realized, a valuation allowance is provided for the excess. Although we have significant loss carry forwards available to reduce future income for tax purposes, no amount has been reflected on the balance sheet for deferred income taxes as any deferred tax asset has been fully offset by a valuation allowance. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include stock-based compensation, debt discounts and the valuation allowance related to deferred tax assets. Actual results may differ from these estimates.
Research and Development Costs
We account for research and development costs in accordance with Accounting
Standards Codification subtopic 730-10, Research and Development ("ASC 730-10").
Under ASC 730-10, all research and development costs must be charged to expense
as incurred. Accordingly, internal research and development costs are expensed
as incurred. Third-party research and development costs are expensed when the
contracted work has been performed or as milestone results have been achieved as
defined under the applicable agreement. Company-sponsored research and
development costs related to both present and future products are expensed in
the period incurred.
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Index Depreciation
Depreciation is computed using the straight-line method over the assets' expected useful lives or the term of the lease, for assets under capital leases.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits in banks with maturities of three months or less, and all highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less.
Options and warrants issued
We allocate the proceeds received from equity financing and the attached options and warrants issued, based on their relative fair values, at the time of issuance. The amount allocated to the options and warrants is recorded as additional paid in capital.
Related Parties For the purposes of these financial statements, parties are considered to be related if one party has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where our company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Results of Operations We are a research and development stage company and our MyoCell™ product candidate has not received regulatory approval or generated any material revenues and is not expected to until late 2019, if ever. We have generated substantial net losses and negative cash flow from operations since inception and anticipate incurring significant net losses and negative cash flows from operations for the foreseeable future as we continue clinical trials, undertake new clinical trials, apply for regulatory approvals, make capital expenditures, add information systems and personnel, make payments pursuant to our license agreements upon our achievement of certain milestones, continue development of additional product candidates using our technology, establish sales and marketing capabilities and incur the additional cost of operating as a public company.
Selling, General and Administrative
Selling, general and administrative expenses were$2,284,577 in 2021, a decrease of$328,634 in selling, general and administrative expenses of$2,613,211 in 2020. The decrease is due to reduced operations due to the Court order. Inflation
Our opinion is that inflation has not had, and is not expected to have, a material effect on our operations.
Climate Change Our opinion is that neither climate change, nor governmental regulations related to climate change, have had, or are expected to have, any material effect on our operations.
Liquidity and Capital Resources
In 2021, we continued to finance our operational cash needs with cash generated from financing activities.
Economic Injury Disaster Loan (EIDL)
OnJune 20, 2020 , the Company executed the standard loan documents for an EIDL from theU.S. Small Business Administration in light of the impact of the COVID-19 pandemic on our business. Pursuant to that certain Loan Authorization and Agreement (the "SBA Loan Agreement"), the principal amount of the EIDL received was$150,000 , with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per annum. Installment payments, including principal and interest, are due monthly beginningJune 20, 2021 (twelve months from the date of the SBA Loan Agreement) in the amount of$731 . OnMarch 15, 2021 , the initial payment date was extended 12 months toJune 20, 2022 . The balance of principal and interest is payable thirty years from the date of the SBA Loan Agreement. As ofDecember 31, 2021 and 2020, the remaining carrying value of the note was$150,000 . AtDecember 31, 2021 and 2020, accrued interest on the note was$8,615 and$2,990 , respectively, and is included in accrued expenses on the accompanying balance sheet. 24
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Index Operating Activities Net cash used in operating activities was$1,057,939 in 2021 as compared to$478,886 of net cash used in operations in 2020. Our net cash used in operations in 2021 resulted primarily from a net loss of$3,287,416 , partially offset by non-cash items including interest and amortization of debt discount of$977,386 , stock-based compensation of$556,556 , related party notes payable issued for services rendered of$422,722 , loss on settlement of accounts payable and accrued interest of$151,410 and bad debts of$93,241 , as well as an increase in accounts payable of$73,195 . Investing Activities
Net cash provided by investing activities was
Financing Activities Net cash provided by financing activities was$1,078,762 in the year endedDecember 31, 2021 as compared to net cash provided of$497,456 in the year endedDecember 31, 2020 . Our net cash provided by financing activities in 2021 resulted from proceeds of received from the issuance of convertible notes payable of$766,000 , proceeds from the sale of common shares of$275,000 and proceeds received from related party advances of$90,000 , partially offset by repayments of notes payable of 52,238.
Existing Capital Resources and Future Capital Requirements
Our MyoCell™ product candidate has not received regulatory approval or generated any material revenues. We do not expect to generate any material revenues or cash from sales of our MyoCell™ product candidate until commercialization of MyoCell, if ever. We have generated substantial net losses and negative cash flow from operations since inception and anticipate incurring significant net losses and negative cash flows from operations for the foreseeable future. Historically, we have relied on proceeds from the sale of our common stock and our incurrence of debt to provide the funds necessary to conduct our research and development activities and to meet our other cash needs. AtDecember 31, 2021 , we had cash and cash equivalents totaling$39,393 ; our working capital deficit as of such date was$11,987,776 . Our independent registered public accounting firm has issued its report datedMarch 31, 2022 in connection with the audit of our financial statements as ofDecember 31, 2021 that included an explanatory paragraph describing the existence of conditions that raise substantial doubt about our ability to continue as a going concern.
As of
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Recent Accounting Pronouncements
Refer to Note 1. Organization and Summary of Significant Accounting Policies in the notes to our financial statements for a discussion of recent accounting pronouncements.
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