UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2024
Or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 001-41031
Bluejay Diagnostics, Inc.
(Exact Name of Registrant as Specified in Its
Charter)
(Address of Principal Executive Offices) (Zip Code)
(844)327-7078
(Registrant’s Telephone Number, Including Area
Code)
Securities registered pursuant to Section 12(b) of
the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $0.0001 per share BJDX The Nasdaq Stock Market LLC
Securities registered pursuant to section 12(g)
of the Act: None
Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐No☒
Indicate by check mark if the registrant is not required
to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐No☒
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 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
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. ☐
If securities are registered pursuant to Section 12(b)
of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of
an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error
corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s
executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant has
filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its
audit report. Yes ☐ No ☒
Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Act). Yes ☐
No ☒
The aggregate market value of the registrant’s
voting stock held by non-affiliates as of June 30, 2024, was approximately $1,700,000 based on the closing price of the common stock of
the registrant as reported on the Nasdaq Capital Market on such date. Shares of common stock held by each executive officer and director
and by each other person who may be deemed to be an affiliate of the registrant have been excluded from this computation. The determination
of affiliate status for this purpose is not necessarily a conclusive determination for other purposes. As of March 21, 2025, there were
554,012 shares of the registrant’s common stock, par value $0.0001 per share, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
The registrant intends to file a definitive proxy
statement relating to its Annual Meeting of Stockholders within 120 days of the fiscal year ended December 31, 2024. Portions of such
definitive proxy statement are incorporated by reference in Part III of the Form 10-K to the extent described therein.
TABLE OF CONTENTS
Page
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS ii
SUMMARY OF RISK FACTORS iii
PART I 1
ITEM 1. BUSINESS 1
ITEM 1A. RISK FACTORS 8
ITEM 1B. UNRESOLVED STAFF COMMENTS 28
ITEM 1C. CYBERSECURITY 28
ITEM 2. PROPERTIES 28
ITEM 3. LEGAL PROCEEDINGS 28
ITEM 4. MINE SAFETY DISCLOSURES 28
ITEM 6. RESERVED 29
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 34
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 34
ITEM 9A. CONTROLS AND PROCEDURES 35
ITEM 9B. OTHER INFORMATION 36
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 36
PART III 37
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 37
ITEM 11. EXECUTIVE COMPENSATION 37
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES 37
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 38
i
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
We
make forward-looking statements in the “Business”, “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and other sections of this Annual Report on Form 10-K (the “Form 10-K”). In some cases,
you can identify these statements by forward-looking words such as “may,” “might,” “should,” “would,”
“could,” “expect,” “plan,” “anticipate,” “intend,” “believe,”
“estimate,” “predict,” “potential” or “continue,” and the negative of these terms and
other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions
about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business.
These statements are only predictions based on our current expectations and projections about future events. There are important factors
that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity,
performance or achievements expressed or implied by the forward-looking statements.
While
we believe we have identified material risks, these risks and uncertainties are not exhaustive. Other sections of this Form 10-K may
describe additional factors that could adversely impact our business and financial performance. Moreover, we operate in a very competitive
and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and
uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors,
may cause actual results to differ materially from those contained in any forward-looking statements.
Although
we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of
activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness
of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are
under no duty to update any of these forward-looking statements after the date of this Form 10-K to conform our prior statements to actual
results or revised expectations, and we do not intend to do so.
We
caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this Form 10-K in the case
of forward-looking statements contained in this Form 10-K.
You
should not rely upon forward-looking statements as predictions of future events. Our actual results and financial condition may differ
materially from those indicated in the forward-looking statements. We qualify all of our forward-looking statements by these cautionary
statements. Although we believe that the expectations reflected in the forward looking-statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements. Therefore, you should not rely on any of the forward-looking statements.
In addition, with respect to all of our forward-looking statements, we claim the protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995.
SPECIAL
NOTE REGARDING COMPANY REFERENCES
In
this Form 10-K, and unless the context otherwise requires, the “Company,” “we,” “us” and “our”
refer to Bluejay Diagnostics, Inc. and its wholly-owned subsidiary Bluejay Spinco, LLC, taken as a whole.
ii
SUMMARY
OF RISK FACTORS
Our
business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely
affect our business, financial condition, liquidity, results of operations and prospects. These risks are discussed more fully in Item
1A. Risk Factors. These risks include, but are not limited to, the following:
iii
iv
PART
I
ITEM
1. BUSINESS
Overview
Bluejay
Diagnostics, Inc. (“Bluejay”) is a medical diagnostics company focused on improving patient outcomes in critical care
settings. We are working on developing rapid tests using whole blood on our Symphony technology platform (“Symphony”),
which consists of an analyzer and single-use cartridges. We do not yet have regulatory clearance for Symphony, and we will need to
receive regulatory authorization from the U.S. Food and Drug Administration (the “FDA”) to be marketed as a diagnostic
product in the United States. We have completed the development of the Symphony analyzer. We are currently preparing to transfer
the intellectual property underlying the production of the Symphony cartridges from the original developer and outside supplier,
Toray Industries, to an in-house facility. We are also beginning the process of redeveloping aspects of the Symphony cartridges to
address several technical challenges to bring Symphony to a level consistent with necessary performance and quality requirements.
After redevelopment, we plan to transfer manufacturing of the Symphony cartridges to a Contract Manufacturing Organization
(“CMO”) to manufacture the Symphony cartridges. To achieve our plan, we expect to need to raise at least $30
million of capital between the second quarter of 2025 and the end of the 2027 fiscal year, which we hope to do in various tranches
during this time period. Our current plan, subject to achieving necessary financing, is to begin testing of samples we are
collecting as part of our ongoing SYMON-II clinical trial in mid-2027, with a goal of being in position to submit a 510(k)
regulatory application to the FDA in the fourth quarter of 2027, with an objective of achieving FDA approval as early as the third
quarter of 2028.
Our
Symphony platform is a combination of Bluejay’s intellectual property (“IP”) and exclusively licensed and patented
IP on the Symphony technology that we believe, if cleared, authorized, or approved by the FDA, can provide a solution to a significant
market need in the United States. The Symphony device is designed to produce laboratory-quality results in 20 minutes in critical care
settings, including Intensive Care Units (“ICUs”) and Emergency Rooms (“ERs”), where rapid and reliable results
are required.
Our
first product candidate, the Symphony IL-6 test, is an immunoassay for the measurement of interleukin-6 (IL-6) to be used for the monitoring
of disease progression in critical care settings. We are currently focused on pursuing the Symphony IL-6 test in the context of sepsis.
IL-6 is a clinically established inflammatory biomarker, and is considered a ‘first-responder,’ for assessment of severity
of infection and inflammation across many disease indications, including sepsis. A current challenge of healthcare professionals is the
excessive time and cost associated determining a patient’s level of severity at triage and we believe that our Symphony IL-6 test,
if ultimately successful and approved, could have the ability to consistently monitor this critical care biomarker with rapid results.
If
we succeed with the foregoing plan, in the future we hope to develop additional tests for Symphony, including tests for myocardial infraction
and congestive heart failure (cardiac biomarkers hsTNT and NT pro-BNP) as well as other tests using the Symphony platform.
In
the future, we also hope to explore new products to support our biomarker detection program. Furthermore, we intend to explore strategic
opportunities around our pending IP on clinical utilities of IL-6 and the specimen biobanks generated from our SYMON I and SYMON II clinical
studies.
Our
operations to date have been funded primarily through the proceeds of (i) our initial public offering (the “IPO”) on November
2021 (the “IPO Date”), (ii) the registered direct offering of common stock and concurrent private placement of warrants that
we completed on August 28, 2023, (iii) the public offering of common stock and warrants that we completed on January 2, 2024, and (iv)
the public offering of common stock and warrants that we completed on June 20, 2024. Since inception, our operations have resulted in
accumulated deficit of approximately $34.7 million, and for the fiscal year ended December 31, 2024, we incurred operating losses of
approximately $7.2 million. As described above and elsewhere herein, we expect to need a material amount of additional funding to finance
our operations during the next several years and ultimately commercialize our products, and we do not currently expect to have any sources
of revenue during this period.
We
were incorporated under the laws of Delaware on March 20, 2015. Our headquarters is located in Acton, Massachusetts.
On
June 4, 2021, Bluejay formed Bluejay Spinco, LLC, a wholly owned subsidiary, for purposes of further development of our ALLEREYE diagnostic
test. ALLEREYE is a point-of-care device offering healthcare providers a solution for diagnosing Allergic Conjunctivitis.
Our
Market
The
Symphony platform is designed to address a subset of the global in vitro diagnostics devices (“IVDs”) market, with
a focus on targeting critical care markets where physicians must quickly determine patient acuity to identify optimal treatment regimens.
We are currently focused on our initial biomarker test, Symphony IL-6 test, in the context of the evaluation of the risk of mortality
due to sepsis. We hope in the future to also explore the potential for adding new biomarker tests to the Symphony platform to also be
used in the context of cardio-metabolic diseases, cancer and other diseases that require rapid tests.
1
Our
Business Model
We
do not currently have any revenue-generating operations. Our goal is to become the first provider of rapid tests for critical care settings,
including infectious, inflammatory and metabolic diseases, by leveraging the strengths of our Symphony platform. We intend to target
our sales and marketing of Symphony to the largest critical care facilities in the United States. Our planned business model, which is
contingent on us ultimately obtaining market approval and commercializing our Symphony platform, includes the following:
The
Symphony Platform
The
Symphony platform is a proprietary technology platform that is designed to provide rapid and accurate measurements of key diagnostic
biomarkers found in blood in a manner that we believe is innovative in the market. Symphony is compact and is designed for the potential
of it to be deployed in a manner that is more mobile than current laboratory diagnostic platforms on the market. Symphony incorporates
a user-friendly interface where all sample preparation and reagents are integrated into the disposable Symphony cartridges. Symphony
only requires a few drops of blood to provide a measurement in approximately 20 minutes.
The
Symphony analyzer is developed and is designed to orchestrate sample processing (e.g. whole blood, plasma, serum, etc.), biomarker isolation,
and immunoassay preparation using non-contact centrifugal force. All necessary reagents and components are integrated into the Symphony
cartridges. Utilizing precision microchannel technology and high specificity antibodies, liquid samples are processed, and the biomarker
is isolated within the Symphony cartridge. Intermitted centrifugation cycles enable complex fluid movements, allowing sequential reagent
additions and independent reaction steps inside the Symphony cartridge. At the conclusion of the test, the Symphony analyzer measures
the fluorescence signature correlating to a highly sensitive quantitation of the biomarker.
To
perform a Symphony test, the test operator adds the sample (e.g. whole blood, plasma, serum, etc.) to the Symphony cartridge. After scanning
the patient ID, the Symphony cartridge is inserted into the Symphony analyzer and the operator initiates the fully automated test. Each
analyzer can run up to six cartridges simultaneously, either with six different patient samples or six different tests, providing quantitative
measurements used for improved patient management and clinical decision-making.
Bluejay’s
current supply agreement of Symphony cartridges from Toray Industries is valid through October 2025, at which point we expect the
agreement to expire. To date, Bluejay has relied on Toray’s development and manufacturing of the Symphony cartridges. We have
encountered several technical challenges in the performance and quality of the Symphony cartridges. We are currently preparing to
transfer the intellectual property underlying production of the cartridges from Toray to an in-house facility for redevelopment.
We are also beginning the process of redeveloping aspects of the cartridges to address several technical challenges to bring our
product to a level consistent with the necessary performance and quality requirements. To address the technical challenges related
to the Symphony cartridges, we expect the redevelopment work will occur over at least the next year. In particular, several
individual components in the cartridges need to be replaced and/or validated due to limited supply or discontinuation (including the
antibody used in the cartridge). In addition, we are working to correct several reliability and stability issues with the cartridge
product.
After
the cartridge redevelopment is completed, we plan to transfer the manufacturing process to an FDA-registered CMO. We expect that production
lots for validation testing to support the FDA submission will be available once the transfer to an FDA registered CMO is completed.
At this time, we do not anticipate being able to perform analytical performance validation testing until mid-2027.
Manufacturing
We
plan to manufacture our analyzers through Sanyoseiko Co. Ltd. (“Sanyoseiko”), as a contract manufacturing organizations (“CMO”),
and we have a contract with Sanyoseiko for this purpose.
Once
redeveloped, we plan to transfer manufacturing of our cartridges to Sanyoseiko, or other suitable CMO. We currently do not have a contract
for the manufacture of the redeveloped cartridges.
2
Sanyoseiko
had been selected as our CMO due to their core competencies in manufacturing and quality system recognized by the FDA. Sanyoseiko’s
facilities are located in Japan. We currently license the technology for the Symphony cartridges from Toray. Our license grants us exclusive
global marketing rights, with the exception of Japan. Bluejay holds the rights to manufacture the analyzers.
FDA
Regulatory Strategy
Our
current regulatory strategy is designed to support commercialization of Symphony in the United States once we receive marketing authorization
from the FDA. In May 2023, we submitted a pre-submission application to the FDA presenting study designs to validate Symphony IL-6 for
use with hospitalized sepsis patients. We participated in a pre-submission meeting with the FDA on August 11, 2023, and at the meeting
the FDA provided feedback on the study design, determined that the submission of a 510(k) is the appropriate premarket submission pathway,
and requested that certain data be provided in the 510(k). Based on this feedback, we determined to proceed on this basis, which considers
the FDA’s feedback.
In
the second quarter of 2024, we completed a multicenter SYmphony IL-6 MONitoring Sepsis (“SYMON”) clinical study investigating
the role of interleukin-6 (IL-6) in patients diagnosed with sepsis and septic shock. This prospective study assessed the performance
of IL-6 upon initial presentation to the intensive care unit (ICU). A primary analysis of the SYMON-I pilot clinical study (registered
clinical trial number NCT06181604) highlighted that IL-6 levels within 24 hours of sepsis or septic shock diagnosis and admission to
the ICU may predict patient mortality out to 28 days. Furthermore, a secondary outcome of the SYMON-I study showed that IL-6 levels within
24 hours of sepsis or septic shock diagnosis and admission to the ICU is a predictor of patient mortality during their hospitalization.
Other secondary outcomes showed that lactate and Sequential Organ Failure Assessment (SOFA), standard clinical tests used for sepsis
and septic shock patients, were not predictors of patient mortality out to 28 days. We believe that the findings underscore the potential
importance of IL-6 as a predictor and provide new insights into the potential pathways for improving sepsis outcomes.
Using
the data analysis from the SYMON-I pilot clinical study, we initiated the SYMON-II pivotal clinical study in the third quarter of 2024.
The SYMON II clinical study has three components: (1) collection, freezing, and biobanking of patient samples, (2) measuring IL-6 concentrations
in the biobanked samples near the end of patient enrollment or after the patient enrollment has completed, and (3) analysis of the IL-6
data with the patient outcomes to see if the established IL-6 cutoff value has been validated for 28-day all-cause mortality. Patient
enrollment started during the fourth quarter of 2024. Our goal is to use the Symphony IL-6 test to complete the testing in the SYMON-II
clinical trial.
If
we are able to complete the SYMON-II clinical study and the results are positive, we intend to use the data generated from SYMON-II to
support a 510(k) application to the FDA. This application is currently expected to be based on the following intended use: “Symphony
IL-6 is intended for use to determine the IL-6 concentration as an aid in assessing the cumulative 28-day risk of all-cause mortality
in conjunction with other laboratory findings and clinical assessments for patients diagnosed with sepsis or septic shock in the ICU.”
We also plan to present the SYMON-I and SYMON-II results at future national scientific meetings and publish them in peer-reviewed journals.
Subject to achieving needed funding and successfully addressing the technical challenges that our described above, our goal is to be
in position to submit a 510(k) regulatory application to the FDA in the fourth quarter of 2027, with an objective of achieving FDA approval
as early as the third quarter of 2028.
Our
ability to engage in and complete the activities needed for an FDA submission will be contingent upon us addressing these and other challenges,
including possessing and/or raising sufficient capital, remaining a going concern, and producing product capable of supporting our product
requirements and meeting analytical validation and clinical validation.
Sales
and Marketing
Until
such time as Symphony products may be authorized by the FDA, our sales and marketing efforts are intended to focus on brand awareness
and market education to potential customers, emphasizing the value of monitoring a critical care patient’s IL-6 levels to improve
decision making and patient outcomes. If the device is cleared by the FDA, we intend to target sales to ERs and ICUs at United States
hospitals, as well as to long-term acute care facilities. We hope to establish a market presence by selling Symphony devices and tests
both directly and through various distribution channels to maximize sales volume and market penetration. In addition to our hope to sell
Symphony for eventual use in the patient care market, we are also evaluating sales of Symphony devices for “research use only”
purposes.
3
License
Agreement
We
depend on Toray’s intellectual property to develop the Symphony cartridges upon which the Symphony platform relies. On October
6, 2020, we entered into a License and Supply Agreement, as amended (the “License Agreement”), with Toray, providing us with
an exclusive global license with Toray, excluding Japan, to use their patents and know-how related to the Symphony detection cartridges
for the manufacturing, marketing and sale of the products (as defined in the License Agreement).
On
October 23, 2023, we entered into an Amended and Restated License Agreement (the “New Toray License Agreement”) and a Master
Supply Agreement (the “New Toray Supply Agreement” and, together, the “Toray Agreements”) with Toray. Under the
New Toray License Agreement, we continue to license from Toray intellectual property rights needed to manufacture single-use test cartridges,
and we have received the right to sublicense certain Toray intellectual property to Sanyoseiko in connection with our ongoing agreement
with Sanyoseiko to manufacture our Symphony analyzers and cartridges. In addition, the New Toray License Agreement provides for the transfer
of certain technology related to the cartridges to Sanyoseiko. The royalty payments we are required to pay Toray have been reduced under
the New Toray License Agreement from 15% to 7.5% (or less in certain circumstances) of net sales of certain cartridges for a term of
10 years. A 50% reduction in the royalty rate applies upon expiry of applicable Toray patents on a product-by-product and country-by-country
basis. The New Toray License Agreement contemplates that applicable royalty payment obligations from us to Toray for other products will
be determined separately in the future.
We
are currently preparing to transfer the intellectual property and know-how related to the cartridges to an in-house facility for
redevelopment. After the cartridge redevelopment is completed, we plan to transfer the manufacturing process to an FDA-registered
CMO for validation testing and commercial manufacturing. We do not currently expect to be able to complete this transfer prior to
the end of 2026, at the earliest. If Toray were to assert that we have not established a facility to manufacture our cartridges
prior to the expiration of the supply agreement (which is currently expected to occur in October 2025), Toray could assert that we
are in material breach of the license agreement and seek to terminate it as early as November 2025. If Toray sought to terminate the
license, and was successful in doing so, we would lose access to certain technology required to produce the cartridges that our
Symphony system relies on to function, which would likely result in a material adverse effect on our commercialization
efforts. We are in the process of negotiating an agreement with Toray to, among other things, clarify that Toray will not seek to terminate the
license agreement in connection with the expiration of the supply agreement.
Intellectual
Property, Proprietary Technology
In
the fourth quarter of 2024, we submitted a provisional patent to the U.S. Patent Office. The provisional patent is to establish a priority
date to protect certain utilizations of IL-6 with sepsis patients. We plan to file a Patent Cooperation Treaty (PCT) application in the
fourth quarter of 2025 for the inventions.
We
do not currently directly hold any granted patents. We rely on a combination either directly or through the License Agreement with Toray
of patent, copyright, trade secret, trademark, confidentiality agreements, and contractual protection to establish and protect our proprietary
rights. Of these patents we rely on, the protections expire internationally in 2027 and 2028, while Toray patents in the U.S. expire
on March 18, 2029 and February 22, 2030. As described above, we are currently working toward a goal of achieving FDA approval of the
Symphony product as early as the third quarter of 2028, which means that even if meet our timeline, the period of time we will have to
commercialize our product under the protection of these patents is expected to be very narrow. See Part I, Item 1A. Risk Factors –
“We and Toray may be unable to protect or enforce the intellectual property rights licensed to us, which could impair our competitive
position.”
In
connection with prior development work performed by Bluejay, we plan to apply for patent protections related to certain design improvements
made to the Symphony technology platform.
Competition
There
are currently no FDA cleared or approved IL-6 tests on the market. There are IL-6 tests granted FDA Emergency Use Authorization (EUA)
for use with only COVID-19 patients, including the Roche Cobas®, Siemens ADVIA Centaur® and Beckman Coulter
Access 2®, which are laboratory size equipment and require pre-processing of whole blood prior to performing their test.
We believe that Symphony, which is designed for many liquid sample types including whole blood, provides us with a substantial competitive
advantage over our existing competition that will sustain through commercialization, despite the major life science companies and consistent
entry of innovative start-ups that define our competitive landscape.
Government
Regulation
The
design, development, manufacture, testing and sale of our products in the U.S. are subject to regulation by numerous governmental authorities,
principally the FDA, and corresponding state and local regulatory agencies.
4
FDA
Regulation
Medical
Devices
Generally,
the products we develop must be cleared by the FDA before they are marketed in the United States. Before and after approval, authorization,
or clearance in the United States, our products are subject to extensive regulation by the FDA, as well as by other regulatory bodies.
FDA regulations govern, among other things, the development, testing, manufacturing, labeling, safety, storage, recordkeeping, market
clearance, authorization or approval, advertising and promotion, import and export, marketing and sales, and distribution of medical
devices, including IVDs. IVDs are a type of medical device and include reagents and instruments used in the diagnosis or detection of
diseases, conditions or infections, including, without limitation, the presence of certain chemicals or other biomarkers. Predictive,
prognostic and screening tests can also be IVDs.
In
the United States, medical devices are subject to varying degrees of regulatory control and are classified in one of three classes depending
on the extent of controls the FDA determines are necessary to reasonably ensure their safety and effectiveness:
● Class III: special controls and requires a premarket approval (“PMA”).
FDA
Premarket Clearance and Approval Requirements
Unless
an exemption applies, each medical device commercially distributed in the United States requires either FDA clearance of a 510(k) premarket
notification, approval of a de novo application, or approval of a premarket approval (PMA).
While
most Class I devices are exempt from the 510(k) premarket notification requirement, manufacturers of most Class II devices
are required to submit to the FDA a premarket notification under Section 510(k) of the FDCA requesting permission to commercially
distribute the device. The FDA’s permission to commercially distribute a device subject to a 510(k) premarket notification is generally
known as 510(k) clearance. Devices deemed by the FDA to pose the greatest risks, such as life sustaining, life supporting or some implantable
devices, or devices that have a new intended use, or use advanced technology that is not substantially equivalent to that of a legally
marketed device, are placed in Class III, requiring approval of a PMA. Some pre-amendment devices are unclassified, but are subject
to FDA’s premarket notification and clearance process in order to be commercially distributed. Our initial product is a Class II
device subject to 510(k) clearance.
510(k)
Clearance Marketing Pathway
To
obtain 510(k) clearance, a company must submit to the FDA a premarket notification submission demonstrating that the proposed device
is “substantially equivalent” to a predicate device already on the market. A predicate device is a legally marketed device
that is not subject to PMA, i.e., a device that was legally marketed prior to May 28, 1976 (pre-amendments device) and for which
a PMA is not required, a device that has been reclassified from Class III to Class II or I, or a device that was found substantially
equivalent through the 510(k) process. The FDA’s 510(k) clearance process usually takes from three to twelve months, but often
takes longer. The FDA may require additional information, including clinical data, to make a determination regarding substantial equivalence.
In addition, the FDA collects user fees for certain medical device submissions and annual fees for medical device establishments.
After
a device receives 510(k) marketing clearance, any modification that could significantly affect its safety or effectiveness, or that would
constitute a major change or modification in its intended use, will require a new 510(k) clearance or, depending on the modification,
PMA approval. The FDA requires each manufacturer to determine whether the proposed change requires submission of a 510(k) or a PMA in
the first instance, but the FDA can review any such decision and disagree with a manufacturer’s determination. If the FDA disagrees
with a manufacturer’s determination, the FDA can require the manufacturer to cease marketing and/or request the recall of the modified
device until 510(k) marketing clearance or PMA approval is obtained. Also, in these circumstances, the manufacturer may be subject to
significant regulatory fines or penalties.
De
Novo Classification
Devices
of a new type that FDA has not previously classified based on risk are automatically classified into Class III by operation of section
513(f)(1) of the FDCA, regardless of the level of risk they pose. To avoid requiring PMA review of low- to moderate-risk devices classified
in Class III by operation of law, Congress enacted section 513(f)(2) of the FDCA. This provision allows FDA to classify a low- to moderate-risk
device not previously classified into Class I or II. After de novo authorization, an authorized device may be used as a predicate for
future devices going through the 510(k) process.
The
FDA has classified Symphony as de novo, a device of a new type that the FDA has not previously classified. Once obtained, a de novo authorization
may lead to Symphony’s use as a predicate for future devices going through the 510(k) process.
5
Clinical
Trials
Clinical
trials are often required for a de novo authorization. All clinical investigations of devices to determine safety and effectiveness must
be conducted in accordance with the FDA’s IDE regulations which govern investigational device labeling, prohibit promotion of the
investigational device, and specify an array of recordkeeping, reporting and monitoring responsibilities of study sponsors and study
investigators. If the device presents a “significant risk,” to human health, as defined by the FDA, the FDA requires the
device sponsor to submit an IDE application to the FDA, which must become effective prior to commencing human clinical trials. A significant
risk device is one that presents a potential for serious risk to the health, safety or welfare of a patient and either is implanted,
used in supporting or sustaining human life, substantially important in diagnosing, curing, mitigating or treating disease or otherwise
preventing impairment of human health, or otherwise presents a potential for serious risk to a subject. An IDE application must be supported
by appropriate data, such as animal and laboratory test results, showing that it is safe to test the device in humans and that the testing
protocol is scientifically sound. The IDE will automatically become effective 30 days after receipt by the FDA unless the FDA notifies
the company that the investigation may not begin. If the FDA determines that there are deficiencies or other concerns with an IDE for
which it requires modification, the FDA may permit a clinical trial to proceed under a conditional approval.
In
addition, the study must be approved by, and conducted under the oversight of, an Institutional Review Board (IRB) for each clinical
site. The IRB is responsible for the initial and continuing review of the IDE study and may pose additional requirements for the conduct
of the study. If an IDE application is approved by the FDA and one or more IRBs, human clinical trials may begin at a specific number
of investigational sites with a specific number of patients, as approved by the FDA. If the device presents a non-significant risk to
the patient, a sponsor may begin the clinical trial after obtaining approval for the trial by one or more IRBs without separate approval
from the FDA, but must still follow abbreviated IDE requirements, such as monitoring the investigation, ensuring that the investigators
obtain informed consent, and labeling and record-keeping requirements. Acceptance of an IDE application for review does not guarantee
that the FDA will allow the IDE to become effective and, if it does become effective, the FDA may or may not determine that the data
derived from the trials support the safety and effectiveness of the device or warrant the continuation of clinical trials. An IDE supplement
must be submitted to, and approved by, the FDA before a sponsor or investigator may make a change to the investigational plan that may
affect its scientific soundness, study plan or the rights, safety or welfare of human subjects.
During
a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, trial monitoring, selecting
clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping
and prohibitions on the promotion of investigational devices or on making safety or effectiveness claims for them. The clinical investigators
in the clinical study are also subject to FDA regulations and must obtain patient informed consent, rigorously follow the investigational
plan and study protocol, control the disposition of the investigational device, and comply with all reporting and recordkeeping requirements.
Additionally, after a trial begins, we, the FDA or the IRB could suspend or terminate a clinical trial at any time for various reasons,
including a belief that the risks to study subjects outweigh the anticipated benefits.
Sponsors
of applicable clinical trials of devices also are required to register with www.clinicaltrials.gov, a public database of clinical
trial information. Information related to the device, patient population, phase of investigation, study sites and investigators and other
aspects of the clinical trial is made public as part of the registration. Although the FDA’s Quality System Regulation (QSR) does
not fully apply to investigational devices, the requirement for controls on design and development does apply.
Post-market
Regulation
After
a device is cleared or approved for marketing, numerous and pervasive regulatory requirements continue to apply. These include:
● establishment registration and device listing with the FDA;
● requirements related to promotional activities;
6
Once
we have a commercialized product, our manufacturing processes will be required to comply with the applicable portions of the QSR, which
cover the methods and the facilities and controls for the design, manufacture, testing, production, processes, controls, quality assurance,
labeling, packaging, distribution, installation and servicing of finished devices intended for human use. The QSR also requires, among
other things, maintenance of a device master file, device history file, and complaint files. As a manufacturer, we are subject to periodic
scheduled or unscheduled inspections by the FDA. Our failure to maintain compliance with the QSR requirements could result in the shut-down
of, or restrictions on, our manufacturing operations and the recall or seizure of our products, which would have a material adverse effect
on our business. The discovery of previously unknown problems with any of our products, including unanticipated adverse events or adverse
events of increasing severity or frequency, whether resulting from the use of the device within the scope of its clearance or off-label
by a physician in the practice of medicine, could result in restrictions on the device, including the removal of the product from the
market or voluntary or mandatory device recalls.
The
FDA has broad regulatory compliance and enforcement powers. If the FDA determines that we failed to comply with applicable regulatory
requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions:
● unanticipated expenditures to address or defend such actions;
● operating restrictions, partial suspension or total shutdown of production;
● refusal to grant export approval for our products; or
● criminal prosecution.
Employees
As
of March 21, 2025, we have 7 full-time employees, which includes two executive officers. We also contract with several consultants
and contractors performing finance, accounting, regulatory advisory, investor relations and manufacturing scale-up support. To conserve
costs, our President and Chief Executive Officer serves as our principal financial and accounting officer, in addition to being our principal
executive officer. In addition, we do not employ any internal legal personnel. None of our employees are represented by labor unions
or covered by collective bargaining agreements.
Reverse
Stock Splits and Increase to Authorized Capital
On
July 24, 2023, we effected the first reverse stock split of our shares of common stock at a ratio of 1-for-20 (the “July 2023 Reverse
Stock Split”). On June 20, 2024, we effected a second reverse stock split of our shares of common stock at a ratio of 1-for-8 (the
“June 2024 Reverse Stock Split”). On November 18, 2024, we effected a third reverse stock split of our shares of common stock
at a ratio of 1-for-50 (the “November 2024 Reverse Stock Split” and together with the July 2023 Reverse Stock Split and the
June 2024 Reverse Stock Split, the “Reverse Stock Splits”). As such, collectively, the Company’s common stock has undergone
reverse stock splits that have combined the shares on a 1-for-8,000 aggregate basis since July 2023. The Reverse Stock Splits became
effective on the dates noted above, when the Company’s common stock opened for trading on Nasdaq on a post-split basis under the
Company’s existing trading symbol, “BJDX.” All historical share and per share amounts reflected throughout this Form
10-K have been adjusted to reflect the Reverse Stock Splits. However, our periodic and current reports, and all other documents incorporated
by reference into this Form 10-K that were filed prior to the dates noted above, do not give effect to the applicable Reverse Stock Splits.
On
October 23, 2024, the stockholders of the Company approved and adopted an amendment to the Company’s amended and restated certificate
of incorporation, to increase the number of authorized shares of the Company’s Common Stock to 250,000,000.
Available
Information
Our
principal executive offices are located at 360 Massachusetts Avenue, Suite 203, Acton, MA 01720 and our telephone number is (844) 327-7078.
Our website address is www.bluejaydx.com. Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K
and all amendments to those reports, proxy statements and other information about us are made available, free of charge, through the
Securities and Exchange Commission (“SEC”) Filings section of our website at www.ir.bluejaydx.com/financial-information/sec-filings
and at the SEC’s website at www.sec.gov as soon as reasonably practicable after such material is electronically filed with or furnished
to the SEC. We include our website address in this report only as an inactive textual reference and do not intend it to be an active
link to our website. The contents of our website are not incorporated into this report.
In
addition, our Board of Directors has adopted a written Code of Business Conduct and Ethics applicable to all officers, directors and
employees, which is available through the “Governance Overview” section of our website at www.ir.bluejaydx.com/corporate-governance/governance-overview.
We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding amendment to, or waiver from, a provision of the
Code of Business Conduct and Ethics and by posting such information on the website address and location specified above.
7
ITEM
1A. RISK FACTORS
Investing
in our securities carries a significant degree of risk. You should carefully consider the risks described below, together with all of
the other information in this Form 10-K, including our consolidated financial statements and related notes included elsewhere in this
Form 10-K, before deciding whether to invest in our securities. If any or a combination of the following risks were to materialize, our
results of operations, financial condition and prospects could be materially adversely affected. If that were to be the case, the market
price of our securities could decline, and investors could lose all or part of their investment. The risks and uncertainties described
below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently believe to be
immaterial may also adversely affect our business.
Risks
Related to Our Financial Condition and Capital Requirements
We
have incurred significant losses since our inception, do not currently generate any operating income, and expect to continue incurring
losses as we work to obtain product approval, and thus we may never achieve or maintain profitability.
Since
our inception, we have engaged primarily in development activities, including planning and implementing clinical trials to support commercialization
and FDA approval of our Symphony platform. We have funded our operations primarily through debt and equity financings, and have incurred
losses since inception, including a net loss of approximately $7.7 million and approximately $10.0 million for the years ended December
31, 2024 and 2023, respectively, and from our inception through December 31, 2024, we had an accumulated deficit of approximately $34.7
million.
We
currently have no product revenue and we may not be able to commercialize our Symphony technology platform or achieve significant revenues
or profitability. Our ability to generate revenue and achieve profitability depends upon our ability, alone or with others, to complete
the development process of our product candidates, including regulatory approvals, and thereafter achieve substantial acceptance in the
marketplace for our products. We may be unable to achieve any or all of these goals.
We
will require additional funding to finance our operations to continue as a going concern, which may not be available to us on acceptable
terms, or at all, and our lack of cash resources has slowed the timeline of our clinical trial work and could cause us to run out of
cash resources in the near-term.
To
date, we have relied primarily on private debt and equity financing to carry on our business. We have limited financial resources, negative
cash flow from operations and no assurance that sufficient funding will be available to us to fund our operating expenses and to further
our product development efforts and pursue clinical trials for FDA approval. Based on these and other factors, in our audited consolidated
financial statements for the years ended December 31, 2024 and 2023, we concluded that this circumstance raised substantial doubt about
our ability to continue as a going concern within one year from the original issuance date of such financial statements. Similarly, in
its report on the consolidated financial statements for the years ended December 31, 2024 and 2023, our independent registered public
accounting firm included an emphasis of matter paragraph stating that our recurring losses from operations and continued cash outflows
from operating activities raised substantial doubt about our ability to continue as a going concern. Our consolidated financial statements
for the years ended December 31, 2024 and 2023 do not include any adjustments that may result from the outcome of this uncertainty.
Absent
further funding, we currently expect to run out of available cash resources during the third quarter of 2025. To achieve our current
strategic plan, which strives to be in position to submit a 510(k) regulatory application to the FDA in the fourth quarter of 2027 and
achieve FDA approval as early as the third quarter of 2028, we expect to need to raise at least $30 million of capital between the
second quarter of 2025 and the end of the 2027 fiscal year, which we hope to do in various tranches during this time period. There can
be no assurance that such additional capital will be available on a timely basis or on terms that will be acceptable to us. We currently
do not have any contracts or commitments for additional financing. In addition, any additional equity financing may involve substantial
dilution to our existing stockholders, or provide that an equity or debt financing source obtains rights to control the membership of
our board of directors.
As
a result of our lack of cash resources, we have slowed the timeline of our clinical trial work to preserve cash resources in the near-term.
If we fail to obtain additional financing, we likely will be forced to abandon such activities entirely and file for bankruptcy protection,
with the possible loss of such properties or assets (including the license to our core technology). Based on our explorations to date,
we do not expect that any other strategic alternatives, such as a potential sale of the Company or its assets or other restructuring
efforts, will be available to us in the near-term. As a result, any inability to obtain additional financing in the near-term, including
a material amount of financing over the next 2-3 years, would likely result in a material adverse effect on our business, results of
operations, cash flow, financial condition and prospects and cause our stockholders to receive little or no return on their shares of
common stock.
8
Since
the initial public offering of our common stock in November 2021, the market price of our common stock has fallen by more than 99.9%,
and we expect to need additional funding amounts substantially greater than the current market capitalization of our common stock, which
may result in future dilution that coincides with further material declines in the trading price of our common stock beyond the substantial
declines that have occurred in recent years.
Since
the initial public offering of our common stock in November 2021, the market price of our common stock has fallen by more than 99.9%,
including declines of greater than 80% per year in each of 2022, 2023 and 2024. During such period of time, we have conducted several
public offerings of securities to raise additional capital, and in each case, the market price of our common stock has fallen substantially
after the consummation of such offerings. As described above, we expect to need to raise at least $30 million of funding over the next 2-3