Q1 2024 Tivic Health Systems Inc Earnings Call

Operator: Welcome to the Tivic Health Systems first quarter 2024 financial results and shareholder update conference call. All participants will be in listen-only mode.

Welcome to the Civic Health systems first quarter 2024 financial results and shareholder update conference call.

Speaker Change: All participants will be in listen only mode.

Operator: Please note that the conference is being recorded. Statements made during this call contain forward-looking statements about Tivic's business. You should not place undue reliance on forward-looking statements, as these statements are based upon management's current expectations, forecasts, and assumptions and are subject to significant risks and uncertainty. These statements may be identified by words such as may, will, should, could, expect, intend, plan, anticipate, believe, estimate, predict, potential, forecast, or the negative of these terms or other words or terms of similar meaning.

Speaker Change: Please note that the conference is being recorded.

Speaker Change: Statements made during this call contain forward looking statements about <unk> business.

Speaker Change: You should not place undue reliance on forward looking statements. As these statements are based upon management's current expectations forecasts and assumptions and are subject to significant risks and uncertainties.

Speaker Change: These statements maybe identified by words, such as May will should could expect intend plan anticipate believe estimate predict potential forecast continue or the negative of these terms or other work.

Speaker Change: Or terms of similar meaning.

Speaker Change: Risks and uncertainties that could cause <unk> actual results to differ materially from those set forth in any forward. Looking statements include but are not limited to the matters listed under risk factors in the company's annual report on Form 10-K for the year ended December 31 two.

Twenty-three filed with the Securities and Exchange Commission on March 25th 2024, as well as the company's subsequent filings with the SEC.

Speaker Change: Statements and information, including forward looking statements speak only to the date that they are provided unless an earlier date is indicated and typically does not undertake any obligation to publicly update any statements or information, including forward looking statements, whether as a result of new information.

Future events or otherwise, except as required by law.

Operator: Risks and uncertainties that could cause Tivic's actual results to differ materially from those set forth in any forward-looking statements include, but are not limited to, the matters listed under risk factors in the company's annual report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on March 25, 2024, as well as the company's subsequent filings with the SEC. Statements and information, including forward-looking statements, speak only to the date that they are provided unless an earlier date is indicated, and Tivic does not undertake any obligation to publicly update any statements or information, including forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. Now, I will hand over the call to Jennifer Ernst. Tivic Health's Chief Executive Officer.

Speaker Change: Now, let me handover the call to Jennifer Ernst pivot helps Chief Executive Officer.

Jennifer Ernst: Hello everyone, and thank you for joining us today. I'm Jennifer Ernst, CEO of Tivic Health, and I'm joined today by our interim CFO, Kimberly Bambach. So today, we will be taking a little bit different approach as we go through our discussion. Of course, we'll be touching on our Q1 results, and Kim will go into those in much more detail. However, we've had some pretty important events in the past few weeks, and that's what I want to spend more time discussing with you today, specifically.

Speaker Change: Hello, everyone and thank you for joining us today, I'm, Jennifer Ernst <unk> young to Vic health.

Speaker Change: And I'm joined today by our interim CFO Kimberley bomb back.

Speaker Change: So today, we will be taking a little bit different tactic as we go through our discussion of.

Speaker Change: Of course, I'll be touching on our Q1 results and Kim will go into those in much more detail.

Speaker Change: However, we've had some pretty important events of the past few weeks and that's what I want to spend more time discussing with you today Spitz.

Speaker Change: Specifically.

Jennifer Ernst: I am focusing on the importance of the results we announced from our Vegas Nerve Stimulation Program, results we announced last week coming out of the clinical study we conducted with the Feinstein Institute for Bio-Electronic Medicine at Northwell Health. So those of you that have been following Tivic for a while know that we have one FDA-approved product in the market, sold under the brand name Clear Up and used for the treatment of sinus pain and congestion. That product is based on a patented, handheld bioelectronic design that targets the activity of the trigeminal and sympathetic nerves. On that basis, we generated just over $1 million in revenue last year and $334,000 in Q1.

Kim: I am focusing on the importance of the results, we announced from our vagus nerve stimulation program results, we announced last week coming out of the clinical study we conducted with the Feinstein Institute for bio electronic medicine at North Baja.

unknown: So those of you that have been following to Vic for Awhile know that we have one FDA approved product in market.

unknown: Sold under the brand name clear up and used for the treatment of sinus pain and congestion.

Speaker Change: That product is based on our patented handheld bio electronic design.

Speaker Change: The targets the activity of the trigeminal and sympathetic nerves.

Speaker Change: Now on that we generated just over a million in revenue last year and 334000 in Q1 direct sales of course are representing our largest share.

Jennifer Ernst: Direct sales, of course, are representing our largest share. In Q1, we executed a limited exclusive distribution agreement with McKesson, one of the top 10 medical product distributors in the U.S., through their affiliate Simply Medical. McKesson will be serving as the exclusive distributor of Clarab to major retail outlets, such as CVS, Walmart, Target, eBay, and other online brick and mortar retailers. They have already begun ordering, and I'm excited about the opportunity for this particular relationship as it begins to simplify our channel strategy.

Speaker Change: In Q1, we executed a limited exclusive distribution agreement with Mckesson, one of the top 10 medical product distributors in the U S.

Through their affiliates simply medical Mckesson will be serving as the exclusive distributor clear up some major retail outlets, such as Cvs, Walmart target ebay and other online brick and mortar retailers.

Speaker Change: And they have already begun ordering and I'm excited about the opportunity for this particular relationship as it begins to simplify our channel strategies.

Jennifer Ernst: If you've been tracking us, you also know that we are continuing to improve the unit economics of that particular business line that began last year by reducing the cost of goods and restructuring our internal team. In Q1, we launched a new version of ClearUp.

Speaker Change: If you've been tracking US you also know that we are continuing to improve the unit economics of that particular business line that.

Speaker Change: That began last year was reducing cost of goods and restructuring our internal team.

In Q1, we launched a new version of clear up we were dressed a technical issue in a chip that is part of our products charging circuit and as we rollout. This new version, we are continuing to get our customer acquisition costs in line and at this moment working on restructuring our supply chain to better align to our short term business requirements.

Jennifer Ernst: We addressed a technical issue in a chip that is part of our product's charging circuit. And as we roll out this new version, we are continuing to get our customer acquisition costs in line, and, at this moment, working on restructuring our supply chain to better align to our short-term business requirements. We have also acknowledged for some time that this one product was unlikely to be sufficient to support the expenses of a public company.

Speaker Change: We have also acknowledged for some time, though was that this one product was unlikely to be sufficient to support the expenses of a public company.

Jennifer Ernst: And with that in mind, about two years ago, we began an investigation to leverage what we know about noninvasive bioelectronics into much higher valued diseases, areas where we felt it could be a particularly strong return on investment from that seed two years ago. I am thrilled with the results we were able to announce last week. We announced the successful completion of a pilot clinical study on a novel form of non-invasive vagus nerve stimulation.

And with that in mind about two years ago, We began an investigation to leverage what we know about noninvasive bioelectronics into.

Speaker Change: Into much higher valued diseases.

Areas, where we felt there could be a particularly strong return on investment.

Speaker Change: And that seed two years ago.

Speaker Change: I am thrilled.

Speaker Change: With the results we were able to announce last week, we announced the successful completion of a pilot clinical study on a novel form of non invasive vagus nerve stimulation.

Jennifer Ernst: The clinical trial was conducted with the Feinstein Institutes for Medical Research and represents a significant growth opportunity for the company. Not only did we announce the fact that it was successful, but the magnitude of the results we saw. We showed large, meaningful changes in cardiac, neurologic, and autonomic function via a non-invasive stimulation of the vagus nerve, changes in these functions that are equivalent to the state-of-the-art in implanted devices. That's a big deal.

Speaker Change: Clinical trial was conducted with the Feinstein Institute for medical research and represents a significant growth opportunity for the company.

Speaker Change: Not only did we announced the fact that it was successful.

Speaker Change: But the magnitude of the results. We saw we showed large meaningful changes in the cardiac neurologic and autonomic functions D.

Speaker Change: Via a noninvasive stimulation of the vagus nerve.

Speaker Change: Changes in these functions that are equivalent to the state of the art in implanted devices.

Speaker Change: That's a big deal.

Jennifer Ernst: Now at this point, we don't believe the market has fully absorbed the import of what we announced and its potential for investors, which is why I'm going to spend a fair amount of time on it. To provide some background, let me start first with why we chose to focus on the vagus nerve as the next candidate for product. The vagus nerve is a high, high-value target in medicine. It's the longest autonomic nerve in the body.

Speaker Change: Now at this point, we don't believe the market is fully absorbed the import of what we announced and its potential for investors, which is why I'm going to spend a fair amount of time on it.

Speaker Change: To provide some background, let me start first with why we chose to focus on vagus nerve as the next candidate for products.

Speaker Change: The Vegas nerve is high high value targeted medicine.

Speaker Change: It's the longest autonomic nerve in the body. It runs from the brain some sort of got and it touches every major Oregon in between the.

Jennifer Ernst: It runs from the brainstem to the gut, and it touches every major organ in between. The vagus nerve is responsible for regulating functions from digestion and heart rate to breathing to inflammation and neurologic. And since the vagus nerve regulates so many organs and neurologic systems that are associated with chronic disease, modulating and changing the activity in this nerve pathway is of significant interest in medicine. Now, currently overarching, the vagus nerve stimulation market breaks into three major areas. First.

Jennifer Ernst: Most medically approved devices for vagus nerve stimulation, or VNS, as it's called, are implanted. They are rigorously tested, they require FDA approval, and they command high premiums, both in pricing and in market cap. Such implanted devices are already an established treatment method for epilepsy, for treatment-resistant depression, and more recently have been approved for stroke rehabilitation. BNS is also currently being investigated to treat inflammatory diseases such as rheumatoid arthritis and multiple sclerosis.

Speaker Change: The vagus nerve is responsible for regulating functions from digestion is heart rate to breathing to inflammation and neurologic activity.

Jennifer Ernst: Keep in mind, when I say implanted, think of an electrical device that looks like a pacemaker, surgically implanted in the upper chest, and then wires are run up to and attached directly to a nerve in and around the neck area. And despite the fact it's a surgical implant, it's common to see response rates that run only around 50% for a surgically implanted device. That's why there is a significant opportunity and an overwhelming need to develop safe and effective vagus nerve devices that can be applied noninvasively. Noninvasiveness is our key watchword.

Speaker Change: And sensitive vagus nerve regulate so many oregon's and neurologic system that are associated with chronic disease.

Speaker Change: Modulating in changing the activity in this nerve pathway is of significant interest in medicine.

Jennifer Ernst: There's a second sector of VNS that has recently proliferated. These are the vagus nerve stimulators marketed as wellness quote-unquote wellness devices. These are not regulated.

Now currently overarching the vagus nerve stimulation market.

Jennifer Ernst: They do not require clinical data, and they're sold almost exclusively for stress. Now, recently, device manufacturers have petitioned the FDA to provide stronger oversight of these devices, given that there are actually potential risks associated with unregulated, untested VNS. Finally, there are a couple notable companies in a third emerging category.

Speaker Change: Breaks into three major areas.

Jennifer Ernst: This is the space we fit into, the place where medical grade non-invasive, I guess, nerve stimulation devices are coming to the forefront. Think of these as the evidence-based part of non-invasive VMS. ElectraCore, which many of you that are listening will know, sells the GammaCore device for migraines and cluster headaches with FDA approval, and the TrueVaga version as a wellness product for stress.

Speaker Change: First <unk>.

Jennifer Ernst: Spark Medical is a company that uses auricular vagus nerve stimulation; that means they administer it via the ear to support patients through opioid withdrawal. OK, with those two, that leaves open a great deal of territory for effective non-invasive vagus nerve stimulation, particularly where we can generate targeted biological changes similar to the implanted devices and do so in areas where VNS has already been established as a treatment option. So with that as a backdrop, starting in 2022, we conducted a full survey of the intellectual property landscape in this space. We identified gaps, and we began low-level experimentation on a novel method of noninvasive vagus nerve stimulation. This work is informed in part by some unpublished work by a key collaborator.

Speaker Change: Most medically approved devices for vagus nerve stimulation or B N S as it's called or implanted.

Speaker Change: They are rigorously test or they require FDA approval and they command higher premiums both in pricing and in market cap.

Speaker Change: Such implanted devices are already an established treatment method for epilepsy for treatment resistant depression and more recently have been approved for stroke rehabilitation.

Speaker Change: BNS is also currently being investigated to treat inflammatory diseases, such as rheumatoid arthritis and multiple sclerosis.

Speaker Change: Keep in mind, when I say implanted.

Speaker Change: And electrical device it looks like a pacemaker surgically implanted in the upper chest and then wires are run up to an attached directly to a nerve in around in that area.

Speaker Change: And despite of the fact that the surgical implant, it's common to see response rates that run only around 50% for surgically implanted device.

Speaker Change: That's why there is a significant opportunity.

Speaker Change: Overwhelming need to develop safe and effective vagus nerve devices that can be applied noninvasively.

Speaker Change: Noninvasively as Archie watchword.

There's a second sector of VNS, such as recently proliferate it.

Speaker Change: These are the vagus nerve stimulators marketed as wellness quote unquote wellness devices. These are not regulated they do not require clinical data and they're sold almost exclusively for stress.

Speaker Change: Now recently device manufacturers a petition to the FDA to provide stronger oversight of these devices given that there are actually potential risks associated with unregulated untested DNS.

Speaker Change: Finally, there are a couple of notable companies in a third emerging category. This is a space we fit into the place where medical grade non invasive vagus nerve stimulation devices are coming to the forefront.

Speaker Change: Think of these as the evidenced based part of non invasive VNS.

Speaker Change: Electric or who many of you that are listening will know sounds the gamba core device for migraine and cluster headache with F D a approval.

Speaker Change: And the true vulgar version as a wellness product for stress.

Speaker Change: <unk> medical is a company that uses a regular vagus nerve stimulation that means they administered via the ear.

Speaker Change: Support patients through opioid withdrawal.

Speaker Change: Okay with those two that leaves open a great deal of territory for effective noninvasive vagus nerve stimulation.

Speaker Change: Particularly where we can generate targeted biological changes similar to the implanted devices.

Speaker Change: And do so in areas, where VNS has already been established as a treatment option.

Speaker Change: So with that as backdrop, starting in 2022 we conducted a full survey of the intellectual property landscape in this space.

Speaker Change: Yeah.

Speaker Change: We identified holes and we began low level of experimentation on a novel method of noninvasive vagus nerve stimulation.

Speaker Change: This work is informed in part by some unpublished work is a key collaborator.

Jennifer Ernst: Our results indicated we could potentially target and influence the activity of the vagus nerve with more precision than what has thus far been demonstrated in the field. That data became the foundation of our current collaboration with the Feinstein Institutes for Medical Research at Northwell Health. In 2023, we began a 20-person clinical trial in collaboration with the Zanos Lab at the Institute of Bioelectronic Medicine, part of the Feinstein Institute. This team is arguably one of the world leaders in bioelectronic medicine, if not the world leader, and we are absolutely thrilled with the data that came out of this study. So a bit more about the study itself. Physiological measurements were taken before, during, and after NCVNS treatment to assess the impact of our treatment on the autonomic nervous system, on cardiac function, and on brain activity and compare it to baseline.

Speaker Change: Our results indicated we could potentially target and influence the activity of the vagus nerve with more precision than what has been thus far have demonstrated in the field.

Speaker Change: That day and it became the foundation of our current collaboration with the Feinstein Institute for Medical research at North will help.

Zahnow slab: In 'twenty two 'twenty three we began a 20 person clinical trial in collaboration with the Zahnow slab at the Institute of Bio electronic medicine part of the Feinstein institutes.

Zahnow slab: This team.

Zahnow slab: Is arguably one of the world leaders in bio electronic medicine, if not be world leader.

Zahnow slab: And we are absolutely thrilled with the data that came out of this study.

Zahnow slab: So a bit more about the study itself.

Physiological measurements were taken before during and after and C V N S treatment.

Zahnow slab: Assess the impact of our treatment on the autonomic nervous system on the cardiac function and on brain activity.

Compared to baseline.

Jennifer Ernst: RVNS intervention resulted in a 97% increase in a measurement known as RMSSD. This is a measurement of heart rate variability, and this was in one 20-minute treatment. Clinically, higher RMSSD is associated with lower morbidity and lower mortality in cardiovascular disease. RMSSD is also widely accepted as a proxy for vagus nerve activity. Increasing parasympathetic activity has been shown to have potential in the treatment and prevention of cardiac arrhythmia, an area of very high, very high value in cardiac disease.

Zahnow slab: Our VNS intervention resulted in a 97% increase in our measurement known as R. M. S. S D.

Amount of heart rate variability.

Zahnow slab: And this was in 120 minute treatment.

Zahnow slab: Clinically.

Zahnow slab: Our M. S. S D is associated with lower morbidity.

Zahnow slab: And lower mortality and cardiovascular disease.

Zahnow slab: RMS is D is also widely accepted as a proxy for vagus nerve activity.

Zahnow slab: Increasing parasympathetic activity, that's been showing to have potential in the treatment and prevention of cardiac arrhythmia.

Zahnow slab: Two areas of very high very high value in cardiac disease.

Jennifer Ernst: We also took measurements of brain activity using EEG, and the outcomes demonstrated that the Tivic VNS intervention increased frontal theta power by 24%. Frontal theta activity is associated with that calm, awake state, learning, and memory. Increasing parental theta power is expected to offer effective treatments for anxiety, treatment-resistant depression, and post-traumatic stress disorder, and some of the areas where we have already seen adoption of the implanted device. Now, here's the big one.

We also took measurements of brain activity using E G.

Zahnow slab: And the outcomes demonstrated that the topics E&S intervention.

Zahnow slab: Increased frontal say the power by 24%.

Zahnow slab: A frontal theater activity is associated with that calm awake states learning and memory.

Zahnow slab: Increasing frontal data power is expected to offer effective treatments for anxiety for treatment resistant depression for post traumatic stress disorder.

Zahnow slab: Yeah, and some of the areas, where we have already seen adoption of the implanted devices.

Zahnow slab: Now here's the big one we saw reduced gamma power in multiple brain region, a 66% reduction in frontal gamma power.

Jennifer Ernst: We saw a reduced gamma power in multiple brain regions, a 66% reduction in frontal gamma power. That's the activity associated with reducing arousal anxiety. And we saw a 62% reduction in the temporal regions, which may have implications for reduction in epileptic seizures. And finally, we measured autonomic nervous system activity. During NCVNS stimulation, subjects had a sustained pupil constriction of nine and a half percent in pupil diameter. This is an outcome that's associated closely with the activation of the parasympathetic nervous system.

Speaker Change: That's the activity associated with reducing arousal anxiety, and we saw a 62% reduction in the temporal regions, which may have implications for reduction in epileptic activity.

Speaker Change: And finally, we measured autonomic nervous system activity during the N C. D. N S stimulation subjects had a sustained pupil constriction of nine 5% in pupil diameter.

This is an outcome that's associated closely with the activation of the parasympathetic nervous system.

Jennifer Ernst: The evidence strongly supports that the changes in cardiac and neurologic data that we've seen are a direct result of engagement of the vagus nerve, in this case achieved in this study with a non-invasive device. However, previous studies of non-invasive VNS have reported very mixed results regarding autonomic nervous system change. In fact, we have found no prior studies that have shown the magnitude of these changes with a non-invasive device. Nevertheless, we were able to show results non-invasively that parallel those that are reported for implanted BNS.

Speaker Change: The evidence strongly supports that the changes in cardiac and neurologic data that we've seen are a direct result of engagement of the vagus nerve.

Speaker Change: In this case accomplished in that study with a non invasive device.

Speaker Change: The previous studies of non invasive VNS have reported very mixed results regarding auto gnomic nervous system changes.

Speaker Change: In fact, we have found no. Prior studies that have shown the magnitude of these changes with a noninvasive device.

Speaker Change: We were able to show results Noninvasively. The parallel those are reported for implanted VNS.

Jennifer Ernst: I can't emphasize strongly enough that these results are highly differentiated from other approaches for non-invasive VNS that we are aware of. Achieving these numbers in a healthy population is a very notable achievement. And we believe that this clinical program represents a significant new opportunity for creating shareholder value. Earlier this week, we also closed financing on a four million round shortly after the announcement of the VNS program, which we intend to utilize as working capital, including moving forward on the next phase of the clinical work on the VNS program.

Speaker Change: I can't underscore strongly enough that these results are highly differentiated from other approaches for non invasive VNS that we are aware of.

Achieving these numbers in a healthy population is a very notable achievement.

Speaker Change: And we believe that this clinical program represents a significant new opportunity for creating shareholder value.

Speaker Change: Earlier. This week, we also closed financing on a 4 million round. Shortly after the announcement of the VNS program, which we intend to utilize those working capital, including moving forward on the next phase of the clinical work on the VNS program.

Jennifer Ernst: So with this as a backdrop, I hope that I've been able to underscore how important this program and VNS is for the company in terms of creating new growth paths and new growth opportunities above and beyond the current product line. Now, I'd like to hand it over to Kim to go over this quarter's financial results and the details associated with the financing.

Speaker Change: So with this as backdrop I hope that I've been able to underscore how important this program in VNS is for the company in terms of creating new growth paths on new growth opportunities above and beyond the current product line.

Kim: And now let me hand, it over to Kim to go over this quarter's financial results and the details associated with the financing.

Kimberly Ann Bambach: Thanks, Jennifer. And good afternoon, everyone.

Kim: Thanks, Jennifer and good afternoon, everyone I'm pleased to report the first quarter of 'twenty 'twenty four financial results.

Kimberly Ann Bambach: I am pleased to report the first quarter 2024 financial results. We posted first quarter revenue of $334,000, a decrease of $42,000 or 11.2% compared to the same quarter last year, primarily due to a price point increase on our single commercial product, Clear Up. This resulted in a 35% decrease in unit sales, offset by a corresponding increase in the per unit average sale price. We expect some continued variability in clear-up sales due to the reduction in marketing spend and price point positioning for target markets with a net impact resulting in a higher gross profit and lower loss from operations.

Kim: We posted first quarter revenue of 334000, a decrease of 42000 or 11, 2% compared to the same quarter last year, primarily due to a price point increase of our single commercial product clear up.

Kim: This resulted in a 35% decrease in unit sales offset by a corresponding increase in the per unit average sale price.

Kim: We expect some continued variability and clear up sales due to the reduction in marketing spend and price point positioning for target markets with the net impact, resulting in a higher gross profit and lower loss from operation.

Kimberly Ann Bambach: For the three months ended March 31st, cost of sales decreased by 96,000 or 37% compared to the same quarter last year, primarily driven by a decrease in sales volume. Gross profit for the first quarter was $167,000, an increase of $54,000 or 48% compared to $113,000 in the same quarter last year. The improvement, again, primarily due to the clear-up price increase and the lower cost per unit. Total operating expenses were $1.6 million for the first quarter of 2024, compared to $2.2 million in the same quarter last year.

Kim: For the three months ended March 31st cost of sales decreased by 96000 or 37% compared to the same quarter last year, primarily driven by the decrease in sales volume.

Kim: Gross profit for the first quarter was 167000, an increase of 54000 or 48% compared to 113000 in the same quarter last year.

Kim: The improvement again, primarily due to the clear up price increase and the lower cost per unit.

Kim: Total operating expenses were $1 6 million for the first quarter 2024, compared to $2 2 million in the same quarter last year. The decrease of 581000 or 26% is attributed to our first quarter 2023, one times segmentation studies are clear up.

Kimberly Ann Bambach: The decrease of 581,000, or 26%, is attributed to a first quarter 2023 one-time segmentation study for clear-up, as well as lower staff consulting professional fees and other reduced general administrative expenses. As a result, our first quarter net loss was $1.5 million compared to $2.1 million in the same quarter last year.

Kim: As well as lower staff consulting professional fees and other reduced general and administrative expenses.

Kim: As a result, our first quarter net loss was $1 5 million compared to $2 1 million in the same quarter last year.

Kimberly Ann Bambach: On May 13, 2024, we sold an aggregate of 4,710,000 shares of our common stock, together with Series A warrants of $4,710,000 and Series B warrants of $7,065,000 to certain investors at a public offering price of $0.85 per share. This offering resulted in aggregate gross proceeds to the company of $4 million; aggregate net proceeds to the company after deducting placement agent fees and offering expenses were approximately $3.5 million. Maxim Group served as the placement agent for the offering.

Kim: On May 13th 2024, we sold an aggregate of 4.710 million shares of our common stock together with the series a warrant a $4 million 710000 in series B warrants of 7 million to 65000 to certain investors at a public offering price of 85 cents per share.

Kim: This offering resulted in aggregate gross proceeds to the company of $4 million.

Kim: Aggregate net proceeds to the company after deducting placement agent fees and offering expenses was approximately $3 5 million.

Kimberly Ann Bambach: The securities issued in connection with the offering were registered pursuant to the registration statement, which was initially filed with the commission on March 29th, 2024, and which the commission declared effective as amended on May 9th, 2024. As of May 14, 2024, including proceeds from the offering, the company had approximately $4.7 million of cash and cash equivalents, and we continue to maintain a no-debt balance sheet. I will now hand the call back to Jennifer for her closing remarks.

Kim: Maxim Group served as the placement agent for the offering the securities issued in connection with the offering were registered pursuant to the registration statement, which was initially filed with the commission on March 29, 2024, and which the commission declared affected as amended on May 19 2024.

Kim: As of May 14th 2024, including proceeds from the offering the company had approximately $4 7 million of cash and cash equivalents and we continue to maintain no debt balance sheet.

Jennifer Ernst: I will now hand, the call back to Jennifer for ending remarks.

Jennifer Ernst: Thanks, Kim, for taking us through all of the details, particularly the financing section. Now, 2023, as I look back, this has been a time of resetting, rebuilding, and recovery. 2024, now that we can finally begin talking with you about the exciting work that we are doing and the new possibilities for bioelectronic medicine based on our VNS work. This is an exciting year.

Jennifer Ernst: Thanks, Kevin for taking us through all of the details, particularly of the financing section.

Jennifer Ernst: Now 2023 as I look back this has been a time of resetting the rebuilding and recovery.

Speaker Change: 'twenty 'twenty four now that we can finally began talking with you about the exciting work that we're doing in the new possibilities for bio electronic medicine based on our BNS work.

Speaker Change: This is an exciting year.

Jennifer Ernst: So, yes, we've got a commitment to fiscal response. We remain focused on decreasing our expenses and optimizing our operations for efficiency. We've revamped the administrative cost structure of the business.

Speaker Change: So yes, we've got a commitment to fiscal responsibility, we remain focused on decreasing our expenses optimizing our operations for efficiency.

Speaker Change: We've revamped the administrative cost structure of the business, we continue to reduce the overhead expenses.

Jennifer Ernst: We continue to reduce overhead expenses and continue to hone and focus the marketing strategy. Our most important investments, though, at this time, are likely to be the investments we make in furthering the VNS program to continue to deliver on a new set, a new initiative, of milestones and potential value inflection points. As we have done in the past, we continue to evaluate business combinations, licensing opportunities, and other types of strategic transactions that may help enrich our product portfolio with complementary offerings. We also recognize, though, that they must be the right opportunities at the right time. Market conditions have to be conducive to being able to close and manage those opportunities.

Speaker Change: And continue to hone in and focus the marketing strategy.

Speaker Change: Our most important investments, though at this time are likely to be the investments we make in furthering the VNS program to continue to deliver on our news that new initiative.

Speaker Change: Milestones and potential value inflection points.

Speaker Change: As we have done in the past, we continue to evaluate business combinations licensing opportunities other types of strategic transactions that may help enrich our product portfolio with complementary offerings.

Speaker Change: We also recognize though that they must be the right opportunities at the right time.

Speaker Change: Market conditions have to be conducive to being able to close and manage those opportunities. So we remain vigilant in assessing the opportunities that may disproportionately benefit our shareholders.

Jennifer Ernst: So we remain vigilant in assessing opportunities that may disproportionately benefit our shareholders, while we continue to make a concurrent investment in the internal and organic development of our own technology. Our research pipeline is beginning to become an even more important part of our strategy to build shareholder value. We believe, I believe, that the VNS opportunity, as well as the medical extensions of our trigeminal nerve stimulation platform, which are currently in trial, have the potential to be of great significance to the company and to our shareholders.

Speaker Change: Well, we continue to make a concurrent investment in the internal and organic development of our own technology.

Our research pipeline is beginning to become an even more important part of our strategy to build shareholder value.

Speaker Change: We believe I believe that the VNS opportunity. So all of the medical extensions of our trigeminal nerve stimulation platform that are currently in trial.

Speaker Change: Has the potential to be a great significance to the company and to our shareholders.

Speaker Change: Yeah.

Jennifer Ernst: VNS is a growing market segment, part of an 8.3 billion neurostimulation market, and we at Tivic, along with collaborators such as the Feinstein Institute for Bioelectronic Medicine, hope to lead the way to meaningful improvements in how VNS devices can precisely target and modulate the vagus nerve activity. We're seeking to achieve these intended biological and clinical outcomes with non-invasive or perhaps maybe minimally invasive, but non-invasive devices

Speaker Change: Vienna is a growing market segment, it's part of an $8 3 billion neuro stimulation market.

Speaker Change: And we at civic along with collaborators such as the Feinstein Institute for bio electronic medicine.

Speaker Change: Hope to lead the way to meaningful improvements in how VNS devices can precisely target and modulate the vagus nerve activity.

We're seeking to achieve these intended biological and clinical outcomes with noninvasive or perhaps maybe minimally invasive but with non invasive devices.

Jennifer Ernst: And with that, I want to thank you for taking the time with us today. I hope you have heard a vision that unlocks new potential for the company, and I look forward to speaking with you as we make progress through the year and continue to report on both our financial and research progress.

Speaker Change: And with that I want to thank you for taking the time with US today I Hope you have heard now a vision that unlocks new potential for the company and I look forward to speaking with you as we make progress through the year and continue to report out on both our financial and research progress.

Operator: Thank you, everyone. This concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.

Thank you everyone. This concludes today's event.

Speaker Change: You may disconnect at this time and have a wonderful day. Thank you for your participation.

Speaker Change: Yeah.