UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): August 10, 2022
 
Femasys Inc.
(Exact name of registrant as specified in its charter)

Delaware
001-40492
11-3713499
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

3950 Johns Creek Court, Suite 100
Suwanee, Georgia
30024
(Address of principal executive offices)
(Zip Code)
 
(770) 500-3910
(Registrant’s telephone number, including area code)
 
n/a
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Exchange Act:

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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
 
Emerging growth company ☒
 
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. ☒

Item 2.02
Results of Operations and Financial Condition.
 
On August 10, 2022, Femasys Inc. (the “Company”) announced its financial results for the second quarter ended June 30, 2022 and provided a corporate update. A copy of the press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
 
The information in this Current Report on Form 8-K and Exhibit 99.1 attached hereto is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
 
Item 9.01
Financial Statements and Exhibits.
 
(d)
Exhibits.

Exhibit
No.
Description
 


Press Release of Femasys Inc. dated August 10, 2022
104
Cover Page Interactive Data File (embedded within the Inline XBRL Document)

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

 
Femasys Inc.
 
 
By:
/s/ Kathy Lee-Sepsick
 
Names: Kathy Lee-Sepsick

Title: Chief Executive Officer


Date: August 10, 2022


Exhibit 99.1

Femasys Inc. Announces Financial Results for the Second Quarter Ended
June 30, 2022 and Provides Corporate Update

-    Continued focus and progress with FemaSeed® and FemBloc® biomedical product candidates in development

-    FemCerv® and FemCath™ commercial availability expected by year-end
 
ATLANTA, August 10, 2022 -- Femasys Inc. (NASDAQ: FEMY), a biomedical company aiming to meet women's needs worldwide by developing a suite of product candidates that include minimally invasive, in-office technologies for reproductive health, today announced financial results for the second quarter and six months ended June 30, 2022 and provided a corporate update.
 
“The decision this past quarter announcing the overturn of the landmark Roe v. Wade case underscores the importance for women to have access to reproductive health options that are safe and reliable, which strongly coincides with Femasys’ mission," said Kathy Lee-Sepsick, founder, president and chief executive officer of Femasys. “Now, more than ever, advanced and modernized reproductive health solutions, like those we are developing for women, are of paramount importance as options for family planning. Safety and choice have always been core drivers in our mission to develop non-surgical solutions for women around the world. FemBloc® is the only permanent birth control alternative in development designed with accessibility and affordability in mind to provide a non-surgical tubal occlusion option to women.”
 
Second Quarter and Recent Developments Related to Clinical Programs

FemBloc
•
On July 28, 2022, Femasys hosted a Key Opinion Leader (KOL) event in the wake of the overturn of Roe v. Wade, to discuss FemBloc. The webinar featured a presentation from KOL, Paul D. Blumenthal, MD, MPH, Professor of Obstetrics and Gynecology of The Stanford University Medical Center and discussion of the unmet need for women seeking permanent birth control options.

•
Femasys remains on track to complete enrollment for its Stage 2 study of FemBloc in the third quarter and file an Investigational Device Exemption (IDE) for a pivotal trial to support a Pre-Market Authorization (PMA) in the first quarter of next year.

FemaSeed
•
An interim analysis for the FemaSeed LOCAL de novo pivotal trial is planned for the fourth quarter of this year. The trial is being conducted across centers in the United States and is expected to enroll up to 792 patients who are diagnosed as infertile. The primary endpoints of the study are to determine effectiveness (clinical pregnancy rate) and safety over a period of up to seven weeks. The Company expects to complete enrollment in the second quarter of next year.

Corporate Highlights

•
In July, Charles Larsen, a current member of Femasys’ Board of Directors, was appointed to the role of non-executive Chair, replacing founder, president and chief executive officer, Kathy Lee-Sepsick. Mr. Larsen has served as a member of Femasys’ board of directors since October 2015 and brings over 40 years of medical device industry experience and skills strongly aligned with the Company’s strategy to strengthen its corporate governance.
 
Ms. Lee-Sepsick added, “After extensive preparations last quarter, we are now readying to make two products available to the market in the fourth quarter, in line with broadening solutions to improve the continuum of healthcare options for women: FemCerv®, our endocervical tissue sampler, and FemCath™, our selective delivery catheter for fallopian tube evaluation. These two products will be added to our commercial portfolio along with our FemVue® diagnostic product, the first device enabling an in-office ultrasound diagnosis as an alternative to seeing a radiologist, to assess fallopian tubes for infertility. In parallel, we are on track to complete enrollment in the third quarter for FemBloc® our non-surgical permanent birth control solution and in the fourth quarter, conduct an interim analysis for FemaSeed®, our novel treatment for infertility.”
 
Second Quarter 2022 Financial Results

•
General and administrative expenses increased by $130,539, or 12.4%, to $1,181,938 for the three months ended June 30, 2022 from $1,051,399 for the three months ended June 30, 2021. The net increase was largely due to an increase in salaries and related personnel costs due to an increase in headcount, an increase in facility and other allocated overhead costs mainly for additional directors & officers insurance and offset by a decrease in professional costs for legal and accounting.
 
•
Research and development expenses increased by $578,056, or 64.6%, to $1,472,924 for the three months ended June 30, 2022 from $894,868 for the three months ended June 30, 2021. The net increase of $578,056 largely consists of an increase of $142,144 in compensation and related personnel costs primarily due to an increase in headcount, an increase of $233,673 in clinical-related costs, an increase of $88,255 in material and development costs, and an increase of $116,692 in professional and outside consultant costs, all to mainly support the Company’s clinical trials.
 
•
Sales of the Company’s FemVue® product decreased by $22,893, or 7.0%, to $303,113 for the three months ended June 30, 2022 from $326,006 for the three months ended June 30, 2021. U.S. sales increased by $35,094, or 13.1%, for the three months ended June 30, 2022 as compared to the same period last year; however, there were no international sales for the three months ended June 30, 2022 as compared to $57,987 reported for the same period last year resulting in a net decrease of $22,893 in sales. U.S. units sold increased by 12.6% for the three months ended June 30, 2022 as compared to the same period last year.

•
Sales and marketing expenses increased by $41,349, or 189.4%, to $63,177 for the three months ended June 30, 2022 from $21,828 for the three months ended June 30, 2021 largely due to an increase in compensation and related personnel costs due to an increase in headcount and additional marketing costs.
 
•
Cost of sales decreased by $5,274, or 4.9%, to $102,353 for the three months ended June 30, 2022 from $107,627 for the three months ended June 30, 2021. The decrease in cost of sales was largely due to the Company’s sales mix as its U.S. sales have a higher gross margin as compared to its international sales. Gross margin percentage was 66.2% for the three months ended June 30, 2022 as compared to 67.0% for the three months ended June 30, 2021. The Company expects to see improvement in its gross margin in the future as we are investing in equipment and tooling which will enable us to reduce labor in certain manufacturing processes and reduce material costs as well.
 
•
Net loss was $2,634,101, or $0.22 per basic and diluted share attributable to common stockholders, primarily reflecting the factors noted above, for the three months ended June 30, 2022, compared to $1,083,059, or $0.52 per basic and diluted share attributable to common stockholders, for the three months ended June 30, 2021.

•
Cash and cash equivalents as of June 30, 2022 and December 31, 2021, were $19,116,419 and $24,783,029, respectively.

Year to Date 2022 (Six-Months) Financial Results

•
General and administrative expenses increased by $685,907, or 35.3%, to $2,629,293 for the six months ended June 30, 2022 from $1,943,386 for the six months ended June 30, 2021. The increase was largely due to various additional costs associated with being a public company including an increase in salaries and related personnel costs due to an increase in headcount and an increase in facility and other allocated overhead costs mainly for additional Directors & Officers (D&O) insurance.

•
Research and Development expenses increased by $1,004,097, or 53.1%, to $2,893,987 for the six months ended June 30, 2022 from $1,889,890 for the six months ended June 30, 2021. The net increase of $1,004,097 largely consists of an increase of $230,390 in compensation and related personnel costs primarily due to an increase in headcount, an increase of $504,169 in clinical-related costs, an increase of $105,587 in material and development costs and an increase of $178,530 in professional and outside consultant costs, all to mainly support the Company’s clinical trials.

•
Sales decreased by $31,263, or 4.8%, to $624,518 for the six months ended June 30, 2022 from $655,781 for the six months ended June 30, 2021. The $31,263 net decrease was largely attributable to the increase in U.S. sales of $26,724 for the six months ended June 30, 2022 as compared to the same period last year, which were offset by the decrease of $57,987 in international sales for the six months ended June 30, 2022 as compared to the same period last year. U.S. units sold increased by 4.1% for the six months ended June 30, 2022 as compared to the same period last year. International sales were $58,045 and $116,032 for both the six months ended June 30, 2022 and 2021, respectively.

•
Sales and marketing expenses increased by $87,393, or 195.7%, to $132,040 for the six months ended June 30, 2022 from $44,647 for the six months ended June 30, 2021 largely due to an increase in compensation and related personnel costs due to an increase in headcount and additional marketing costs mainly associated with the Company’s FemVue social media campaign earlier this year.

•
Cost of sales increased by $24,359, or 12.1%, to $225,028 for the six months ended June 30, 2022 from $200,669 for the six months ended June 30, 2021. The increase in cost of sales was mainly due to increased production personnel labor and overhead costs applied to the Company’s cost of sales for the six months ended June 30, 2022 as compared to the same period last year. Gross margin percentage was 64.0% for the six months ended June 30, 2022 as compared to 69.4% for the six months ended June 30, 2021. The Company expects to see an improvement in its gross margin in the future as it is investing in equipment and tooling which will enable it to reduce labor in certain manufacturing processes and reduce material costs as well.

Net loss was $5,517,131, or $0.47 per basic and diluted share attributable to common stockholders, primarily reflecting the factors noted above, for the six months ended June 30, 2022, compared to $2,913,291, or $1.89 per basic and diluted share attributable to common stockholders, for the six months ended June 30, 2021.

FEMASYS INC.
Balance Sheets
(unaudited)

Assets
  
June 30,
2022
    
December 31,
2021
  
Current assets:
            
Cash and cash equivalents
  
$
19,116,419
      
24,783,029
  
Accounts receivable, net
    
113,960
      
84,258
  
Inventory, net
    
244,181
      
208,270
  
Other current assets
    
854,962
      
555,853
  
Total current assets
    
20,329,522
      
25,631,410
  
Property and equipment, at cost:
                
Leasehold improvements
    
1,195,637
      
1,155,332
  
Office equipment
    
99,344
      
99,344
  
Furniture and fixtures
    
424,947
      
424,947
  
Machinery and equipment
    
2,434,524
      
2,261,793
  
Construction in progress
    
461,735
      
379,713
  
     
4,616,187
      
4,321,129
  
Less accumulated depreciation
    
(2,985,367
)
    
(2,722,117
)
Net property and equipment
    
1,630,820
      
1,599,012
  
Long-term assets:
                
Lease right-of-use assets, net
    
486,926
      
665,747
  
Intangible assets, net of accumulated amortization
    
10,601
      
25,093
  
Other long-term assets
    
663,083
      
655,418
  
Total long-term assets
    
1,160,610
      
1,346,258
  
Total assets
  
$
23,120,952
      
28,576,680
  

(continued)
FEMASYS INC.
Balance Sheets
(unaudited)

Liabilities and Stockholders’ Equity
  
June 30,
2022
    
December 31,
2021
  
Current liabilities:
            
Accounts payable
  
$
428,325
      
445,522
  
Accrued expenses
    
551,828
      
603,787
  
Clinical holdback - current portion
    
36,238
      
18,947
  
Note payable – current portion
    
417,841
      
181,123
  
Lease liabilities – current portion
    
394,518
      
406,674
  
Other – current
    
36,037
      
36,037
  
Total current liabilities
    
1,864,787
      
1,692,090
  
Long-term liabilities:
                
Clinical holdback - long-term portion
    
109,139
      
149,791
  
Lease liabilities – long-term portion
    
209,098
      
402,417
  
Total long-term liabilities
    
318,237
      
552,208
  
Total liabilities
    
2,183,024
      
2,244,298
  
Commitments and contingencies
                
Stockholders’ equity:
                
Common stock, $.001 par, 200,000,000 authorized, 11,930,833 shares issued and
11,813,610 outstanding as of June 30, 2022; and 11,921,388 shares issued
11,804,165 outstanding as of December 31, 2021
    
11,931
      
11,921
  
Treasury stock, 117,223 shares
    
(60,000
)
    
(60,000
)
Warrants
    
567,972
      
702,492
  
Additional paid-in-capital
    
108,675,491
      
108,418,304
  
Accumulated deficit
    
(88,257,466
)
    
(82,740,335
)
Total stockholders’ equity
    
20,937,928
      
26,332,382
  
Total liabilities and stockholders' equity
  
$
23,120,952
      
28,576,680
  

FEMASYS INC.
Statements of Comprehensive Loss
(unaudited)

   
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2022
    
2021
    
2022
    
2021
  
Sales
  
$
303,113
      
326,006
      
624,518
      
655,781
  
Cost of sales
    
102,353
      
107,627
      
225,028
      
200,669
  
Gross margin
    
200,760
      
218,379
      
399,490
      
455,112
  
Operating expenses:
                                
Research and development
    
1,472,924
      
894,868
      
2,893,987
      
1,889,890
  
Sales and marketing
    
63,177
      
21,828
      
132,040
      
44,647
  
General and administrative
    
1,181,938
      
1,051,399
      
2,629,293
      
1,943,386
  
Depreciation and amortization
    
142,684
      
151,359
      
286,883
      
304,812
  
Total operating expenses
    
2,860,723
      
2,119,454
      
5,942,203
      
4,182,735
  
Loss from operations
    
(2,659,963
)
    
(1,901,075
)
    
(5,542,713
)
    
(3,727,623
)
Other income (expense):
                                
Interest income, net
    
26,745
      
144
      
29,199
      
308
  
Other income
    
—
      
821,515
      
—
      
821,515
  
Interest expense
    
(883
)
    
(3,643
)
    
(3,617
)
    
(7,491
)
Other income, net
    
25,862
      
818,016
      
25,582
      
814,332
  
Net loss
  
$
(2,634,101
)
    
(1,083,059
)
    
(5,517,131
)
    
(2,913,291
)
                                 
Net loss attributable to common stockholders, basic and diluted
  
$
(2,634,101
)
    
(1,083,059
)
    
(5,517,131
)
    
(2,913,291
)
Net loss per share attributable to common stockholders, basic and diluted
  
$
(0.22
)
    
(0.52
)
    
(0.47
)
    
(1.89
)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted
    
11,812,988
      
2,076,516
      
11,808,601
      
1,538,780
  

About Femasys

Femasys Inc. is a biomedical company aiming to meet women's needs worldwide by developing a suite of product candidates that include minimally invasive, in-office technologies for reproductive health. Its two lead product candidates are FemBloc® permanent birth control and FemaSeed® localized directional insemination for infertility. The Company’s product for fallopian tube assessment by ultrasound, FemVue®, is currently marketed in the United States. Femasys is also advancing FemCath™, an intrauterine catheter for selective evaluation of the fallopian tubes and FemCerv®, an endocervical tissue sampler that is the first product of the technology platform for tissue sampling intended to be marketed alongside its other women-specific medical products in the physician’s office setting. To learn more, visit www.femasys.com or follow us on Twitter and LinkedIn.
 
Forward-Looking Statements
 
This press release contains forward-looking statements that are subject to substantial risks and uncertainties. Forward-looking statements can be identified by terms such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “pending,” “intend,” “believe,” “potential” or “continue” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on our current expectations and are subject to inherent uncertainties, risks and assumptions, many of which are beyond our control, difficult to predict and could cause actual results to differ materially from what we expect. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Factors that could cause actual results to differ include, among others: our ability to develop and advance our current product candidates and programs into, and successfully initiate, enroll and complete, clinical trials; the ability of our clinical trials to demonstrate safety and effectiveness of our product candidates and other positive results; estimates regarding the total addressable market for our product candidates; our business model and strategic plans for our products, technologies and business, including our implementation thereof; and those other risks and uncertainties described in the section titled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2021 and other reports as filed with the SEC. Forward-looking statements contained in this press release are made as of this date, and Femasys undertakes no duty to update such information except as required under applicable law.
 
Contacts:
 
Investors
Chuck Padala
LifeSci Advisors, LLC
+1-917-741-7792
[email protected]

Media
Karissa Cross, Ph.D.
LifeSci Communications
[email protected]

Femasys Inc.
Investor Contact:
[email protected]

Media Contact:
[email protected]