NeuroOne Medical Technologies Stock

NeuroOne Medical Technologies Corporation operates as a medical technology company.

The company focuses on the development and commercialization of thin film electrode technology for continuous electroencephalogram (cEEG) and stereoelectrocencephalography (sEEG) recording, monitoring, ablation, drug delivery, and brain stimulation solutions to diagnose and treat patients with epilepsy, Parkinson's disease, dystonia, essential tremors, chronic pain due to failed back surgeries and other related neurological disorders. Additionally, the company is investigating the potential applications of its technology associated with artificial intelligence.

The company is developing its cortical sheet depth electrode technology to provide solutions for diagnosis through cEEG recording and sEEG recording and treatment through spinal cord stimulation, brain stimulation and ablation, all in one product. A cEEG is a continuous recording of the electrical activity of the brain that identifies the location of irregular brain activity, which information is required for proper treatment. cEEG recording involves an invasive surgical procedure, referred to as a craniotomy. sEEG involves a less invasive procedure whereby doctors place electrodes in targeted brain areas by drilling small holes through the skull. Both methods of seizure diagnosis are used to identify areas of the brain where epileptic seizures originate in order to precisely locate the seizure source for therapeutic treatment if possible.

The company's cortical sheet electrode and depth electrode technology has been tested over the years by both WARF, the owners of its licensed patents, and Mayo Clinic located in Rochester, Minnesota, in both pre-clinical models, as well as through an institutional review board ('IRB') approval at Mayo Clinic for clinical research. In 2020, the company announced the first human commercial use of its Evo cortical electrode in a procedure performed at the Mayo Clinic. Regarding its ablation electrode, the Cleveland Clinic and representatives from Emory University have performed testing in bench top models and pre-clinical (or animal testing) models. These pre-clinical tests have demonstrated that the technology is capable of recording, ablation and acute stimulation.

The company received 510(k) FDA clearance for its Evo cortical technology in November 2019. In September 2021, the company received FDA clearance to market its Evo sEEG electrode technology for temporary (less than 24 hours) use with recording, monitoring, and stimulation equipment for the recording, monitoring, and stimulation of electrical signals at the subsurface level of the brain. In October 2022, the company received FDA clearance to market its Evo sEEG electrode technology for temporary (less than 30 days) use with recording, monitoring, and stimulation equipment for the recording, monitoring, and stimulation of electrical signals at the subsurface level of the brain.

The company submitted a 510(k) application to the FDA for the OneRF ablation system in June 2023 and responded to FDA comments on November 6, 2023. On December 6, 2023, the company received 510(k) FDA clearance to market the OneRF ablation system for creation of radiofrequency lesion in nervous tissue for functional neurosurgical procedures.

Strategy

The key elements of the company's strategy are to introduce cortical strip and grid electrodes for the diagnosis of epilepsy in United States; launch depth electrodes for sEEG recording; utilize the core technologies to develop all-in-one diagnostic and therapeutic solutions with the initial focus on a combination diagnostic and ablation electrode; develop percutaneous placed electrodes for spinal cord stimulation with scalable contact configurations; gain clearance for other brain or motor related disorders, such as Parkinson's with the therapeutic technologies developed for epilepsy; explore partnerships with other companies that leverage its core technology; partner with biotech, pharmaceutical or biopharma companies to provide a drug delivery sEEG electrode capable of delivering the therapy and recording before, during and after the therapy is delivered for up to 30 days; and investigate the potential applications associated with artificial intelligence.

Technology

Epilepsy Mapping and Monitoring

The company seeks to leverage scale-able technology and produce ultra-thin, or paper-thin electrodes that allow for high-resolution and high-definition recordings, which would improve mapping resolution and signal acquisition. If the company is able to leverage scale-able technology, it would mean that its technology would be able to incorporate smaller electrodes and thereby increase the number of electrodes on a given surface area. The company expects that this would increase the imaging resolution so that brain activity is displayed in greater definition.

The company's technology consists of three primary types of cortical electrodes: grid electrodes, strip electrodes, and dual-sided electrodes. These electrodes have a patented design that utilizes proprietary processing and materials technology, which it allows the electrodes to have improved features over the industry standard recording electrodes.

The company seeks to develop superior 'scale-able' technology for future product system iterations in higher density contact placement. This opens the doors to other brain related disease recording procedures by providing high fidelity, more accurate diagnostic capabilities and also the ability to provide an all-in-one therapy capable of diagnosis, ablation and/or stimulation. Beyond the brain, the company's technology under development has applications in other neurological signal recording disease states related to voluntary or involuntary motor neuron abnormalities, understanding sensory neuro behavior (pain), limb prosthetics and degenerative muscle disease.

Clinical Development and Regulatory Pathway

Clinical Experience, Future Development and Clinical Trial Plans

The company's Evo cortical electrode technology has received 510(k) clearance from the FDA for recording, monitoring, and stimulating brain tissue for less than 30 days on the surface of the brain. The company's Evo sEEG electrode technology has received FDA 510(k) clearance from the FDA for use (less than 30 days) with recording, monitoring, and stimulation equipment for the recording, monitoring, and stimulation of electrical signals at the subsurface level of the brain. The company's other products have not received any clearance for commercialization by any U.S. or foreign regulatory body. As of September 30, 2023, the company performed a number of bench top (which includes feasibility testing) and pre-clinical tests (which include animal testing of device placement, ergonomics, performance, ease of use, and other tests required by FDA regulations).

The company intends to expand its product offerings to include less invasive means and all-in-one solutions, thus providing both patients and physicians better options to treat epilepsy, Parkinson's disease, dystonia, essential tremors, chronic pain due to failed back surgeries and other related neurological disorders. While the company expects to make modifications to its initial system, most of its future product development initiatives involves unique and transformational next generation technology that should drive further appeal of its products with both physicians and patients.

The company is utilizing a number of resources to develop these technologies. The company licenses three critical patents from the Wisconsin Alumni Research Foundation (WARF) that are the foundation of the technology, and the company develops and intends to commercialize and benefit from the thin film technology know-how of Mayo Clinic doctors through the company's license and development agreement. WARF, Mayo Clinic (cortical electrodes) and Cleveland Clinic (sEEG electrodes) have been responsible for all pre-clinical studies of its technology under development. The company announced in 2020 that Mayo Clinic doctors used its technology in the first human commercial application of its Evo cortical electrode technology to perform recording, functional mapping and stimulation of the brain on a human patient. And more recently, in July 2022, the company announced the first clinical case using the Evo sEEG electrode was selected the Evo sEEG electrode for intraoperative brain mapping at the subsurface level of the brain.

Cortical Strip and Grid Electrodes for the Diagnosis of Epilepsy: The company has finalized the design for the product and there are no further expected changes to the device (design freeze). Pre-clinical testing and clinical testing on the final design has been conducted by Mayo Clinic and WARF. The product is in commercial production. The company received FDA 510(k) clearance in the fourth calendar quarter of 2019. Commercial launch commenced utilizing Zimmer, the company's distribution partner.

Depth Electrodes for Recording (Diagnostic) Purposes: The company has frozen this design and the product is in commercial production. No clinical testing was required in order to obtain FDA clearance. The company filed for FDA 510(k) marketing clearance for sEEG electrodes in May 2021 and received a 510(k) clearance from FDA for recording, monitoring and stimulation of brain tissue for less than 24 hours in September 2021. The company filed for 510(k) clearance to expand the duration of use up to less than 30 days in November 2021. On October 20, 2022, the company received an FDA clearance to market its Evo sEEG Electrode technology for temporary (less than 30 days) use with recording, monitoring, and stimulation equipment for the recording, monitoring, and stimulation of electrical signals at the subsurface level of the brain. Zimmer has indicated its desire to distribute this product in May 2023.

Depth Electrode Diagnostic and Ablation Devices: The design phase was completed at the end of 2022, the verification phase was completed in June 2023, and the transfer to manufacturing phase began in July 2023. Pre-clinical testing, including benchtop and animal testing, has been conducted on final designs. Very early testing at the Cleveland Clinic was completed in the second calendar quarter of 2020. Pre-clinical (animal) feasibility testing was conducted in September 2021 with representatives from Emory University in Atlanta, Georgia. Additional pre-clinical animal testing of the company's final design was conducted at Emory University in April 2023 and invivo testing of its final design was conducted in May 2023. The company announced a partnership with RBC Medical Systems in August 2021 to develop an RF generator that will be used with its diagnostic and ablation electrode. No animal or human clinical testing is anticipated for FDA submission since 510K predicate devices did not perform such clinical testing. The company submitted a 510(k) application to the FDA for the OneRF ablation system in June 2023 and responded to FDA comments on November 6, 2023. The company received 510(k) clearance from the FDA for creation of radiofrequency lesions in nervous tissue for functional neurosurgical procedures on December 6, 2023.

Spinal Cord Stim Electrodes: No design freeze. The company performed pre-clinical in-house bench top testing in August 2020. In 2021/early 2022, the company performed bench top testing of prototypes to demonstrate chronic performance and longevity. In 2023, the company continues to refine its chronic spinal cord electrode design based on SCS customer feedback and do additional pre-clinical bench and/or animal tests to further validate the company's value proposition. This device is in early stages of development. Additionally, the FDA requires that the company conducts human clinical studies. No FDA feedback has been sought or received by the company as of September 30, 20223 on the regulatory/clinical process that may be required for spinal cord stimulation indication, but the company expects regulatory PMA approval requires a more robust clinical process, human clinical data for a PMA (implanted system), depending on proposed indications for use. Future pre-clinical and clinical testing requirements for regulatory submission continues to be evaluated as the company develops the design of this product.

Depth Electrode Chronic Stimulation Devices: No design freeze. Bench top testing were successfully performed in 2021 and early 2022. The company announced the results of these studies in the first quarter of 2022. While this device remains in early development, the company expects to work with clinicians to further refine its designs and continue testing in 2023. No FDA feedback has been sought or received by the company as of September 30, 2023 on the clinical process that will be required for chronic stimulation, but the company expects regulatory approval for chronic stimulation may require a more robust clinical process, which could include a PMA with human clinical data.

Research and Development

The company's research and development expenses were $6.9 million for the year ended September 30, 2023.

Intellectual Property

Patents

As of September 30, 2023, the company's patent estate consisted of three issued United States patents licensed from WARF covering a neural probe array and thin-film micro electrode array and method, a U.S. patent issued in October 2022 and a pending European patent application filed by it and published in 2020 relating to improved neural depth electrodes, a pending U.S. patent application filed by the company and published in 2020 relating to agent-delivering neural electrodes in which a Notice of Allowance was issued in August 2023 (along with a second pending U.S. patent application filed in 2023 relating to the same technology), pending U.S. and European patent applications published in 2020 relating to minimally invasive electrodes (with a Notice of Allowance issued in September 2023 in the U.S. application), pending U.S. and European patent applications published in 2021 relating to spinal cord stimulation systems and devices (with a Notice of Allowance issued in October 2023 in the U.S. application), pending U.S. and European patent applications published in 2022 relating to methods of making electrode probes, a pending U.S. patent application (and corresponding PCT application) published in 2023 relating to devices having temperature sensors, a pending U.S. patent application (and corresponding PCT application) filed in 2023 relating to deformable spinal cord stimulation devices, a pending U.S. patent application (and corresponding PCT application) filed in 2023 relating to spinal cord stimulation device implantation methods, and a pending U.S. patent application (and corresponding PCT application) filed in 2023 relating to ablation probe and temperature sensing device systems. The licensed issued patents expire between 2025 and 2030, subject to any patent extensions that may be available for such patents. The issued patent owned by NeuroOne expires in 2041. If a patent or patents are issued on the company's additional pending patent applications, the resulting patents are projected to expire between 2038 and 2043.

Trademarks

The company has registered U.S. trademarks for the trademarks 'NEUROONE' and 'EVO.' The company has a pending U.S. trademark application for the trademark OneRF. The company also has pending trademark applications in the United Kingdom and the European Union for the trademark OneRF.

Government Regulation

The company's cortical strip, grid and depth electrodes are medical devices subject to extensive and ongoing regulation by the United States (U.S.) Food and Drug Administration (FDA) and the U.S. Centers for Medicare and Medicaid Services (CMS).

The company's business is subject to federal, state, local and harmonized standards, such as ISO 13485, ISO 14971, and FDA's Quality System Regulation (QSR) contained in 21 CFR Part 820.

In addition to FDA restrictions, there are numerous U.S. federal and state laws pertaining to healthcare fraud and abuse, including anti-kickback laws and physician self-referral laws. The company's relationships with healthcare providers and other third parties are subject to scrutiny under these laws.

The company has structured its provider arrangements to comply with Stark Law (the federal Physician Self-Referral Prohibition) requirements.

History

NeuroOne Medical Technologies Corporation was incorporated under the laws of the state of Nevada in 2009.