SEC Info - Modular Medical, Inc. - ‘10-Q’ for 12/31/22

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		Alternative Formats (Word, et al.) Condensed Consolidated Balance Sheets as of December 31, 2022 and March 31, 2022 Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2022 and 2021 Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2022 and 2021 Condensed Consolidated Statements of Stockholders' Equity (Deficit) for the three and nine months ended December 31, 2022 and 2021 Controls and Procedures Defaults Upon Senior Securities Exhibits Financial Information Financial Statements (Unaudited) Item 1 Item 1A Item 2 Item 3 Item 4 Item 5 Item 6 Legal Proceedings Management's Discussion and Analysis of Financial Condition and Results of Operations Mine Safety Disclosures Notes to Condensed Consolidated Financial Statements Other Information Part I Part Ii Risk Factors Signatures Unregistered Sales of Equity Securities and Use of Proceeds
1	1st Page – Filing Submission
"	Part I
"	Financial Information
"	Item 1
"	Financial Statements (Unaudited)
"	Condensed Consolidated Balance Sheets as of December 31, 2022 and March 31, 2022
"	Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2022 and 2021
"	Condensed Consolidated Statements of Stockholders' Equity (Deficit) for the three and nine months ended December 31, 2022 and 2021
"	Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2022 and 2021
"	Notes to Condensed Consolidated Financial Statements
"	Item 2
"	Management's Discussion and Analysis of Financial Condition and Results of Operations
"	Item 4
"	Controls and Procedures
"	Part Ii
"	Other Information
"	Legal Proceedings
"	Item 1A
"	Risk Factors
"	Unregistered Sales of Equity Securities and Use of Proceeds
"	Item 3
"	Defaults Upon Senior Securities
"	Mine Safety Disclosures
"	Item 5
"	Item 6
"	Exhibits
"	Signatures

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

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

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.

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

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

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. i o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

The number of outstanding shares of the registrant’s common stock, par value $0.001 per share, was i 10,932,098 as of February 8, 2023.

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

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(Unaudited)

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

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

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the accompanying condensed consolidated financial statements and notes included in this Quarterly Report on Form 10-Q (this Report). This Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which include, without limitation, statements about the market for our technology, our strategy, competition, expected financial performance and capital raising efforts, and other aspects of our business identified in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission on June 28, 2022 and in other reports that we file from time to time with the Securities and Exchange Commission. Any statements about our business, financial results, financial condition and operations contained in this Report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words “believes,” “anticipates,” “expects,” “intends,” “plans,” “projects,” or similar expressions are intended to identify forward-looking statements. Our actual results could differ materially from those expressed or implied by these forward-looking statements as a result of various factors, including the risk factors described under Item 1A of our Annual Report on Form 10-K for the year ended March 31, 2022. These forward- looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors including, without limitation, the direct and indirect effects of coronavirus disease 2019, or COVID-19 as well as the Russian/Ukraine conflict and inflationary risks, including the risk that the cost of certain of the Company’s materials and product components is increasing, and related issues that may arise therefrom. Many of those factors are outside of our control and could cause actual results to differ materially from those expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Report. All subsequent written and oral forward-looking statements concerning other matters addressed in this Report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Report. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

Our fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in this Report, refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal 2023 refers to the fiscal year ending March 31, 2023). Unless the context requires otherwise, references to “we,” “us,” “our,” and the “Company” refer to Modular Medical, Inc. and its consolidated subsidiary.

We are a development-stage medical device company focused on the design, development and commercialization of an innovative insulin pump using modernized technology to increase pump adoption in the diabetes marketplace. Through the creation of a novel two-part patch pump, our MODD1 product, we seek to fundamentally alter the trade-offs between cost and complexity and access to the higher standards of care that presently-available insulin pumps provide. By simplifying and streamlining the user experience from introduction, prescription, reimbursement, training and day-to-day use, we seek to expand the wearable insulin delivery device market beyond the highly motivated “super users” and expand the category into the mass market. The product seeks to serve both the type 1 and the rapidly growing, especially in terms of device adoption, type 2 diabetes markets.

Historically, we have financed our operations principally through private placements and public offerings of our common stock and sales of convertible promissory notes. Based on our current operating plan, substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that the financial statements included in Item 1 of this Report are issued exists. Our ability to continue as a going concern depends on our ability to raise additional capital, through the sale of equity or debt securities, to support our future operations. If we are unable to secure additional capital, we will be required to curtail our research and development initiatives and take additional measures to reduce costs. We have provided additional disclosure in Note 1 to the condensed consolidated financial statements in Item 1 of this Report and under Liquidity below.

The global outbreak of the coronavirus disease 2019 (COVID-19) was declared a pandemic by the World Health Organization and a national emergency by the U.S. government in March 2020. This has negatively affected the U.S. and global economy, disrupted global supply chains, significantly restricted travel and transportation, resulted in mandated closures and orders to “shelter-in- place” and created significant disruption of the financial markets. The full extent of the COVID-19 impact on our operational and financial performance will depend on future developments, including, without limitation, the duration and spread of the pandemic and related actions taken by U.S. and foreign government agencies to prevent disease spread, all of which are uncertain, out of our control, and cannot be predicted.

Since March 2020, the jurisdiction in which we operate has issued “shelter-in-place” orders from time to time. We have complied with these orders, and, when such orders were in place, minimized business activities at our facility. We have implemented a teleworking policy for our employees and contractors to reduce on-site activity, as necessary. We have and continue to experience longer lead times for certain components used to manufacture initial quantities of our products for our submission to the U.S. Food and Drug Administration (FDA) for approval to commercialize our pump product. We remain diligent in continuing to identify and manage risks to our business given the changing uncertainties related to COVID-19. While we believe that our operations personnel are currently in a position to build an adequate supply of products for our FDA submission, we recognize that unpredictable events could create difficulties in the months ahead. We may not be able to address these difficulties in a timely manner, which could delay our submission to the FDA and negatively impact our business, results of operations, financial condition and cash flows.

We believe that as the COVID-19 pandemic evolves, the direct and indirect impacts of the pandemic on global macroeconomic conditions, as well as conditions specific to us, are becoming more difficult to isolate or quantify. In addition, these direct and indirect factors can make it difficult to isolate and quantify the portion of our costs that are a direct result of the pandemic and costs arising from factors that may have been influenced by the pandemic, such as supply chain constraints, rising inflation, and recessionary fears. We expect these factors and their effects on our operations may persist for a longer period, even after the COVID-19 pandemic has subsided. The continued spread of COVID-19 has also led to disruption and volatility in the global capital markets.

The Russian invasion of Ukraine in February 2022 has led to further economic disruptions. Mounting inflationary costs pressures and recessionary fears have negatively impacted the global economy. During the third quarter of 2022, the U.S. Federal Reserve continued to aggressively address elevated inflation by increasing interest rates. The U.S. Federal reserve increased interest rates by 75 basis points in each of its meetings held in July, September and November 2022, 50 basis points in its meeting held in December 2022, and 25 basis points in its meeting held in February 2023, as inflation remains elevated. We were able to raise additional capital through equity offerings in February 2022 and May 2022, however, we will need to raise additional capital to commercialize our pump product candidate and support our operations in the future. We may be unable to access the capital markets, and additional capital may only be available to us on terms that could be significantly detrimental to our existing stockholders and to our business.

For additional information on risks that could impact our future results, please refer to “Risk Factors” in Part II, Item 1A of this Report.

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make certain estimates and judgments that affect the reported amounts of assets, liabilities, and expenses. On an ongoing basis, we make these estimates based on our historical experience and on assumptions that we consider reasonable under the circumstances. Actual results may differ from these estimates and reported results could differ under different assumptions or conditions. Our significant accounting policies and estimates are disclosed in Note 1 of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended March 31, 2022. As of December 31, 2022, there have been no material changes to our significant accounting policies and estimates.

Our research and development expenses include personnel, consulting, product prototyping and other costs associated with the development and initial production of our insulin pump product. We expense research and development costs as they are incurred.

Research and development, or R&D, expenses increased for the three and nine months ended December 31, 2022 compared with the same period of fiscal 2021, primarily due to increased engineering and operations personnel costs, prototype and production component and material costs and higher stock-based compensation expenses. The increases in R&D expenses were partially offset by a decrease in consulting costs, as we reduced our utilization of consultants, as we increased our employee headcount and the consultants completed development of aspects of our pump design and features. Our full-time R&D employee headcount increased to 32 at December 31, 2022 from 18 at December 31, 2021. R&D expenses included stock-based compensation expenses of $356,752 and $204,962 for the three months ended December 31, 2022 and 2021, respectively, and $1,034,674 and $459,989 for the nine months ended December 31, 2022 and 2021, respectively. We expect research and development expenses to remain comparable for the remainder of fiscal 2023, as we continue to advance the development of our pump product and develop our manufacturing process.

General and administrative expenses consist primarily of personnel and related overhead costs for finance, human resources, legal, marketing and general management.

General and administrative, or G&A, expenses decreased for the three months ended December 31, 2022 compared with the same period of 2021, primarily as a result of decreased stock-based compensation, personnel and benefit costs and legal fees, which in fiscal 2022 related to our public offering and listing on the Nasdaq that was completed in February 2022. These decreases were partially offset by increased consulting and professional services fees.

G&A expenses decreased for the nine months ended December 31, 2022 compared with the same period of 2021, primarily as a result of decreased stock-based compensation, personnel and benefit costs, consulting and legal fees and marketing costs. These decreases were partially offset by increased accounting fees, travel costs and office-related expenses. Our full-time G&A employee headcount increased to 3 at December 31, 2022 from 2 at December 31, 2021. G&A expenses included stock-based compensation expenses of $282,753 and $1,016,774 for the three months ended December 31, 2022 and 2021, respectively and $1,085,839 and $2,280,098 for the nine months ended December 31, 2022 and 2021, respectively. We expect G&A expenses to remain flat for the remainder of fiscal 2023.

As a development-stage enterprise, we do not currently have revenues to generate cash flows to cover operating expenses. Since our inception, we have incurred operating losses and negative cash flows in each year due to costs incurred in connection with R&D activities and G&A expenses associated with our operations. For the nine months ended December 31, 2022, we incurred a net loss of approximately $10.3 million. For the years ended March 31, 2022 and 2021, we incurred net losses of approximately $18.6 million and $7.4 million, respectively. At December 31, 2022, we had a cash balance of approximately $7.7 million and an accumulated deficit of approximately $44.9 million. When considered with our current operating plan, these conditions raise substantial doubt about our ability to continue as a going concern for a period of at least one year from the date that of issuance of the consolidated financial statements included in Item 1 of this Report. Our consolidated financial statements do not include adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Our ability to continue as a going concern depends on our ability to raise additional capital through the sale of equity or debt securities to support our future operations, and we are currently seeking such additional financing. In May 2022, we completed a registered direct offering of securities for net proceeds of approximately $7.4 million.

Our operating needs include the planned costs to operate our business, including amounts required to fund research and development activities, including clinical studies, working capital and capital expenditures. During the nine months ended December 31, we made capital expenditures of approximately $574,000, as we have begun procuring equipment to develop a low-volume manufacturing production line to build our pump product to demonstrate and develop our manufacturing process. We expect to incur increased capital expenditures for the remainder of fiscal 2023. At December 31, 2022, we had outstanding, non-cancelable purchase orders for production equipment totaling $735,000, and we expect to receive and pay for this equipment over the following six months. Our future capital requirements and the adequacy of our available funds will depend on many factors, including, without limitation, our ability to successfully commercialize our product, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product offerings. If we are unable to secure additional capital timely, we will be required to curtail our research and development initiatives and take additional measures to reduce costs in order to conserve our cash.

For the nine months ended December 31, 2022, we used $8,184,696 in operating activities, which primarily resulted from our net loss of $10,307,682, as adjusted for stock-based compensation expenses of $2,120,513, $150,412 for issuances of shares of common stock in exchange for services and depreciation and amortization expenses of $92,616, and increased by net changes in operating lease assets and liabilities of $37,761 and operating assets and liabilities $202,794 and other immaterial adjustments. For the nine months ended December 31, 2021, we used $7,128,787 in operating activities, which primarily resulted from our net loss of $14,058,154, increased for a non-cash gain on the PPP Note extinguishment of $368,780 and net changes in operating lease assets and liabilities of $34,422, as adjusted for changes to operating assets and liabilities of $1,197,988, a loss on debt extinguishment of $1,321,450 stock-based compensation expenses of $2,740,086, $388,021 for issuances of shares of common stock in exchange for services, $149,994 for issuable shares of common stock in exchange for services, depreciation and amortization expenses of $80,268 and interest expense of $1,454,762 for amortization of debt discount.

For the nine months ended December 31, 2022 and 2021, cash used in investing activities of $573,066 and $22,779, respectively, was for the purchase of property and equipment.

Cash provided by financing activities of $7,372,347 for the nine months ended December 31, 2022 was attributable to net proceeds from the issuance of common stock upon completion of an equity offering, net of underwriting fees and issuance costs. Cash provided by financing activities of $5,887,199 for the nine months ended December 31, 2021 was primarily attributable to $4,137,199 of net proceeds from the issuance of our convertible promissory notes, $250,000 from the sale of shares of common stock to officers of the Company and $1,500,000 from the issuance of a promissory bride note.

Recently Issued Accounting Pronouncements are detailed in Note 1 in the Notes to the Condensed Consolidated Financial Statements included in Item 1 of this Report.

Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of our management, including our Chief Executive Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based on this evaluation, our management concluded that, as of December 31, 2022, our disclosure controls and procedures were effective.

During the three months ended December 31, 2022, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We are not currently involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. To our knowledge, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of us or our subsidiary, threatened against or affecting us, our common stock, our subsidiary or our subsidiary’s officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

We face many significant risks in our business, some of which are unknown to us and not presently foreseen. These risks could have a material adverse impact on our business, financial condition and results of operations in the future. There are no material changes to the risk factors set forth under Item 1A of our Annual Report on Form 10-K for the year ended March 31, 2022, which we filed with the SEC on June 28, 2022, and of our Quarterly Report on Form 10Q for the three months ended September 30, 2022, which we filed with the SEC on November 14, 2022, as amended on November 17, 2022.

On December 30, 2022, we issued 6,375 shares of our common stock to four of our non-employee directors in accordance with our Outside Director Compensation Plan.

The aforementioned issuances were made pursuant to exemptions from registration pursuant to Section 4(2) and/or Rule 506 of Regulation D of the Securities Act. We made such determinations based upon representations by the purchasers of such securities including, without limitation, that such purchasers were “accredited investors” as defined in the Securities Act.

There has been no default in the payment of principal, interest, or a sinking or purchase fund installment, or any other material default, with respect to any indebtedness of ours.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Title of each class	Trading symbol(s)	Name of each exchange on which registered
i Common Stock, par value $0.001 per share	i MODD	The i Nasdaq Stock Market, LLC

Large accelerated filer o	Accelerated filer o
i Non-accelerated Filer x	Smaller reporting company i x
	Emerging growth company i x

	December 31, 2022 (Unaudited)			March 31, 2022
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	i 7,690,957		$	i 9,076,372
Prepaid expenses and other		i 180,164			i 313,422
Security deposit		i 100,000			—
TOTAL CURRENT ASSETS		i 7,971,121			i 9,389,794

Property and equipment, net		i 716,409			i 235,959
Right of use asset, net		i 51,312			i 120,693
Security deposit		—			i 100,000
TOTAL NON-CURRENT ASSETS		i 767,721			i 456,652

TOTAL ASSETS	$	i 8,738,842		$	i 9,846,446

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable	$	i 382,080		$	i 299,951
Accrued expenses		i 255,545			i 524,891
Short-term lease liability		i 77,672			i 144,857
TOTAL CURRENT LIABILITIES		i 715,297			i 969,699

Long-term lease liability		—			i 39,957
TOTAL LIABILITIES		i 715,297			i 1,009,656

Commitments and Contingencies (Note 8)

STOCKHOLDERS’ EQUITY
Preferred Stock, $ i i 0.001 / par value, i i 5,000,000 / shares authorized, i i i i none / / / issued and outstanding		—			—
Common Stock, $ i i 0.001 / par value, i i 50,000,000 / shares authorized; i i 10,932,098 / and i i 10,461,898 / shares issued and outstanding as of December 31, 2022 and March 31, 2022, respectively		i 10,932			i 10,462
Additional paid-in capital		i 52,900,066			i 43,406,099
Accumulated deficit		( i 44,887,453	)		( i 34,579,771	)
TOTAL STOCKHOLDERS’ EQUITY		i 8,023,545			i 8,836,790
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	i 8,738,842		$	i 9,846,446


	Three Months Ended December 31,						Nine Months Ended December 31,
	2022			2021			2022			2021
Operating expenses
Research and development	$	i 2,196,546		$	i 1,849,399		$	i 6,804,069		$	i 5,742,911
General and administrative		i 1,161,351			i 1,981,665			i 3,502,029			i 5,156,152
Total operating expenses		i 3,357,897			i 3,831,064			i 10,306,098			i 10,899,063
Loss from operations		( i 3,357,897	)		( i 3,831,064	)		( i 10,306,098	)		( i 10,899,063	)

Other income (expense)		( i 587	)		i 4			i 16			i 368,876
Interest expense		—			( i 1,010,247	)		—			( i 2,204,917	)
Loss on debt extinguishment		—			—			—			( i 1,321,450	)
Loss before income taxes		( i 3,358,484	)		( i 4,841,307	)		( i 10,306,082	)		( i 14,056,554	)

Provision for income taxes		—			—			i 1,600			i 1,600

Net loss	$	( i 3,358,484	)	$	( i 4,841,307	)	$	( i 10,307,682	)	$	( i 14,058,154	)

Net loss per share
Basic and diluted	$	( i 0.31	)	$	( i 0.76	)	$	( i 0.95	)	$	( i 2.22	)

Shares used in computing net loss per share
Basic and diluted		i 10,925,862			i 6,354,145			i 10,863,082			i 6,331,982


	Nine Months Ended December 31,
	2022			2021
Cash Flows from operating activities
Net loss	$	( i 10,307,682	)	$	( i 14,058,154	)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain on PPP note forgiveness		—			( i 368,780	)
Loss on debt extinguishment		—			i 1,321,450
Stock-based compensation expense		i 2,120,513			i 2,740,086
Depreciation and amortization		i 92,616			i 80,268
Shares issued for services		i 150,412			i 388,021
Shares issuable for services		—			i 149,994
Amortization of lease right-of-use asset		i 69,381			i 58,404
Change in lease liability		( i 107,142	)		( i 92,826	)
Amortization of debt discount		—			i 1,454,762
Changes in assets and liabilities:
Other assets and prepaid expenses		( i 15,577	)		( i 25,995	)
Accounts payable and accrued expenses		( i 187,217	)		i 1,223,983
Net cash used in operating activities		( i 8,184,696	)		( i 7,128,787	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		( i 573,066	)		( i 22,779	)
Net cash used in investing activities		( i 573,066	)		( i 22,779	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock and warrants, net		i 7,372,347			—
Proceed from private placement, net of issuance costs		—			i 250,000
Proceeds from issuance of convertible notes, net		—			i 4,137,199
Proceeds from issuance of promissory note		—			i 1,500,000
Net cash provided by financing activities		i 7,372,347			i 5,887,199

Net decrease in cash and cash equivalents		( i 1,385,415	)		( i 1,264,367	)

Cash and cash equivalents at beginning of period		i 9,076,372			i 1,468,465

Cash and cash equivalents at end of period	$	i 7,690,957		$	i 204,098

Supplemental disclosure:
Noncash investing and financing activities:
Fair value of detachable warrants issued with convertible notes	$	—		$	i 3,700,632

Modular Medical, Inc. – ‘10-Q’ for 12/31/22

On: Monday, 2/13/23, at 5:05pm ET · For: 12/31/22 · Accession #: 1019056-23-132 · File #: 1-41277

Previous ‘10-Q’: ‘10-Q/A’ on 11/17/22 for 9/30/22 · Next: ‘10-Q’ on 8/14/23 for 6/30/23 · Latest: ‘10-Q’ on 2/13/24 for 12/31/23

Quarterly Report — Form 10-Q

Filing Table of Contents

‘10-Q’ — Quarterly Report

Document Table of Contents

This is an HTML Document rendered as filed. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference

PART I —	FINANCIAL INFORMATION	3

Item 1.	Financial Statements (Unaudited):	3

	Condensed Consolidated Balance Sheets as of December 31, 2022 and March 31, 2022	3

	Condensed Consolidated Statements of Operations for the three and nine months ended December 31, 2022 and 2021	4

	Condensed Consolidated Statements of Stockholders’ Equity (Deficit) for the three and nine months ended December 31, 2022 and 2021	5

	Condensed Consolidated Statements of Cash Flows for the nine months ended December 31, 2022 and 2021	6

	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

Item 4.	Controls and Procedures	19

PART II —	OTHER INFORMATION	20

Item 1.	Legal Proceedings	20

Item 1A.	Risk Factors	20

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 3.	Defaults Upon Senior Securities	20

Item 4.	Mine Safety Disclosures	20

Item 5.	Other Information	20

Item 6.	Exhibits	21

	Signatures	22

	December 31,			March 31,
	2022			2022
Machinery and equipment	$	i 487,855		$	i 346,358
Construction-in-process		i 427,670			—
Leasehold improvements		i 139,197			i 139,197
Total property and equipment		i 1,054,722			i 485,555
Less: accumulated depreciation and amortization		( i 338,313	)		( i 249,596	)
Total property and equipment, net	$	i 716,409		$	i 235,959

Annual Fiscal Years	Operating Lease
2023		i 39,507
2024		i 40,692
Less:
Imputed interest		( i 2,527	)
Present value of lease liabilities	$	i 77,672

	December 31,				Change
	2022		2021		Fiscal 2022 to Fiscal 2023
Research and development – Three months ended	$	2,196,546	$	1,849,399	$	347,147	18.8	%
Research and development – Nine months ended	$	6,804,069	$	5,742,911	$	1,061,158	18.5	%

Exhibit No.		Description of Document
31.1*		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema
101.CAL		XBRL Taxonomy Extension Calculation Linkbase
101.DEF		XBRL Taxonomy Extension Definition Linkbase
101.LAB		XBRL Taxonomy Extension Label Linkbase
101.PRE		XBRL Taxonomy Extension Presentation Linkbase
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

	MODULAR MEDICAL, INC.

Date: February 13, 2023	By:	/s/ *James E. Besser*
		James E. Besser
		Chief Executive Officer
		(Principal Executive Officer)

Date: February 13, 2023	By:	/s/ *Paul M. DiPerna*
		Paul M. DiPerna
		Chairman, President, Chief Financial Officer and Treasurer
		(Principal Financial Officer)

This ‘10-Q’ Filing	Date	Other Filings

	3/31/23
Filed on:	2/13/23	SC 13G
	2/8/23
	2/1/23
	1/5/23	4, 8-K
For Period end:	12/31/22	4
	12/30/22	4
	12/15/22
	11/17/22	10-Q/A
	11/14/22	10-Q
	9/30/22	10-Q, 10-Q/A, 4
	6/30/22	10-Q, 4
	6/28/22	10-K
	5/5/22	8-K
	5/2/22	8-K
	3/31/22	10-K, 4, 4/A
	2/10/22	4, EFFECT
	12/31/21	10-Q, 4, 8-K
	11/29/21	3, 4, 8-K
	11/24/21	8-K
	9/30/21	10-Q, 4, 8-K
	6/30/21	10-Q, 4
	4/30/21
	3/31/21	10-K
	4/24/20	8-K, UPLOAD
	4/1/20	4
		List all Filings