Form 1-SA Medical 21, Inc. For: Jun 30
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SEMIANUAL REPORT PURSUANT TO REGULATION A
For the fiscal semiannual period ended June 30, 2022
Medical 21, Inc.
A Minnesota Corporation
Medical 21, Inc.
15070 23rd Avenue North
Minneapolis, MN 55447
Phone: (952) 221-3104
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a statement by the management regarding the period of January 1, 2022 through June 30, 2022. The following balance sheets were prepared by the Company.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION OF THE COMPANY
Medical 21, Inc. is a privately-held entity organized February 12, 2016 in the State of Minnesota.
Components of Results of Operations
The following discussion of our financial conditions and results of operations should be read in conjunction with the financial statements and the related notes included elsewhere in this Form 1-SA. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. The Company’s actual results could differ significantly from those discussed in the forward-looking statements. Unless otherwise indicated, the latest results discussed below are as of June 30, 2022.
Revenue/Net Loss from Operating Activities
The Company is, and has been, solely focused on .(*same as previous filing*) . . As of the date of this Offering Circular, the Company has never been profitable. In the first half of 2022, the Company had a Net loss of $1,821,713.23. In the first half of 2021, the Company had a Net loss of $677,560.11. This represents an increase in Net loss of $1,144,153.12 or 169%. The reason for this increase is the Company is growing in staff and expenses yet is still not profitable.
The Company classifies its Operating Expenses as salaries & benefits, research and development, general and administrative expenses, and other operating expenses (professional fees, travel and entertainment and rent). In the first half of 2022, the Company had Operating Expenses totaling $1,821,817.17. In the first half of 2021, the Company had Operating Expenses totaling $677,689.02. This represents an increase in Operating Expenses of $1,144,128.15 or 169%. The reason for this increase is the Company is growing in staff and expenses as the Company grows.
Research and Development Expense
The Company’s research and development efforts are focused on . .(*same as previous filing*). . Research and development expenses consist primarily of . .(*same as previous filing*). .
In the first half of 2022, the Company spent $371,979.88 on research and development expenses. In the first half of 2021, the Company spent $129,043.28 on research and development expenses. This represents an increase of $242,936.60 or 188%. The reason for this increase is the research process has escalated, which means more implants and other research & development expenses.
Salaries and benefits
In the first half of 2022, the Company spent $747,107.89 on salary and benefit expenses. In the first half of 2021, the Company spent $395,750.34 on salary and benefit expenses. This represents an increase of $351,357.55 or 88%. The reason for this increase is the Company hired more employees and implemented a 401K matching plan.
Due to Shareholders
On June 30, 2021 17,555,828 Shares of Common Stock were outstanding, with a total balance Due to Shareholders of $XX. This represents an increase of $XX or XX%. The reason for this increase was more shares of the Company were sold to investors.
On June 30, 2022 20,021,430 Shares of Common Stock were outstanding, with a total balance Due to Shareholders of $XX. This represents an increase of $XX or XX%. The reason for this increase was more shares of the Company were sold to investors.
Liquidity and Capital Resources
As of June 30, 2022, the Company had cash of $1,312,022.77, total assets of $2,786,551.20. As of June 30, 2021, the Company had cash of $3,096,299.09, total assets of $4,190,963.66. This represents a decrease in $1,784,276.32 (or 58%) in cash and $1,404,412.46 (or 34%) in total assets.
The Company has financed its operations primarily through the sale of common stock.
Medical 21 Form 1-SA Section FS for January 1, 2022 to June 30, 2022 and 2021
|Total current assets||$||1,563,198.92||$||3,347,560.70|
|Intangible assets, net||$||250,000.00||$||250,000.00|
|Property and equipment, net||$||1,223,352.28||$||843,402.96|
Liabilities and Stockholder’s Equity
|Other Current Liabilities||$||0.00||$||0.00|
|Total Current Liabilities||$||0.00||$||0.00|
|Paid-In Capital or Surplus||$||13,420,315.99||$||10,198,045.00|
|Total Paid-In Capital or Surplus||$||13,649,547.62||(Not Present)|
|Total liabilities and equity||$||2,786,551.20||$||4,190,963.66|
Statements of Operations for January 1 to June 30, 2022 and 2021
|Salaries & benefits||$||747,107.89||$||395,750.34|
|Research & development expenses||$||371,979.88||$||129,043.28|
|Depreciation and amortization|
|Net Operating Income||$||(1,821,817.17||)||$||(677,689.02||)|
|Total other income||$||103.94||$||128.91|
Statements of Changes in Stockholders’ Equity for December 31, 2021 and 2020
|Common Shares||Stock Amount||Additional Paid-In capital||Accumulated deficit||Total|
|Balance at December 31, 2019||15,778,228||$||157,782||$||5,272,218||$||(3,577,891||)||$||1,852,109|
|Issuance of common stock||824,000||8,240||2,051,760||—||2,060,000|
|Stock-based compensation expense||—||—||361,823||—||361,823|
|Balance at December 31, 2020||16,602,228||166,022||7,685,801||(5,400,413||)||2,451,410|
|Issuance of common stock||1,463,602||14,636||4,331,864||—||4,346,500|
|Stock-based compensation expense||—||—||1,552,584||—||1,552,584|
|Balance at December 31, 2021||18,065,830||$||180,658||$||13,570,249||$||(9,260,659||)||$||4,490,248|
Statements of Cash Flows for January 1 to June 30, 2022 and 2021
|Cash flows from operating activities:||2022||2021|
|Adjustments to reconcile net loss to net cash used by operating activities:|
|Depreciation and amortization||N/A||N/A|
|Stock-based compensation expense||19,000.00||—|
|Changes in assets and liabilities:||—||—|
|Accounts payable and accrued liabilities||0||0|
|Net cash used by operating activities||$||-1,912,074.77||$||-480,794.12|
|Cash flows from investing activities:||-540,570.70||$||-157,351.00|
|Purchase of property and equipment||-536,987.20||-2,491.00|
|Net cash used by investing activities||-540,570.70||$||-157,351.00|
|Cash flows from financing activities:||$||250,547.10||$||2,395,395.00|
|Prepaid equity raise costs||56,500.00||—|
|Proceeds from common stock issued||250,547.10||$||2,395,395.00|
|Net cash provided by financing activities||250,547.10||$||2,395,395.00|
|Net change in cash||$||-2,202,098.37||$||1,757,249.88|
|Cash at beginning of period||3,514.121.14||1,339,049.21|
|Cash at end of period||$||1,312,022.77||$||3,096,299.09|
|Cash paid for income taxes||N/A||N/A|
|Cash paid for interest||0||0|
Exhibit 2A: Articles of Amendment to Articles of Incorporation of Medical 21, Inc.
Exhibit 2B: Bylaws
Exhibit 4: Subscription Agreement
Exhibit 6: Amendment to the License Agreement between University of Iowa Research Foundation and Medical 21, Inc.
Exhibit 8: Escrow Agreement
Exhibit 11: Written Expert Consent Letter of Assurance Dimensions
Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this Offering Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Minneapolis, MN on September 28, 2022.
ISSUER COMPANY LEGAL NAME AND ADDRESS:
Medical 21, Inc.
15070 23rd Avenue North
Minneapolis, MN 55447
This Offering Statement has been signed by the following persons in the capacities and on the dates indicated:
s/: Dr. Manny Villafana, Ph.D. Sc
Director, CEO of Medical 21, Inc.
Date: September 28, 2022
Location Signed: Minneapolis, MN
ATTACHMENTS / EXHIBITS
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