10-Q: Vivos Inc. Q2 Loss Widens Amid R&D Boost

Vivos Inc. reported a wider net loss in Q2 2025 due to increased operating expenses and R&D, despite a rise in revenue, as it continues to fund its Y-90 therapy development and global expansion.

Summary

• Net loss for the six months ended June 30, 2025, was $(1,480,209), compared to $(1,061,997) for the same period in 2024.
• Revenue increased to $41,748 for the six months ended June 30, 2025, from $18,000 in 2024.
• Gross profit shifted to a loss of $(43,835) in H1 2025 from a profit of $1,220 in H1 2024, primarily due to a significant increase in Cost of Goods Sold to $85,583 from $16,780.
• Operating expenses rose to $1,494,470 in H1 2025 from $1,100,659 in H1 2024, driven by higher professional fees, R&D, and general & administrative costs.
• Cash on hand as of June 30, 2025, was $2,660,590.
• The company raised $1,500,000 through common stock issuance and $6,250 through warrant private placement in H1 2025.

Sentiment

Score: 3

Explanation: The company shows some progress in revenue growth and strategic initiatives like FDA Breakthrough Device designation and international expansion. However, the significant widening of net losses, shift to gross loss, increased operating expenses, and explicit 'going concern' doubt from auditors indicate severe financial challenges and high operational risk. While capital has been raised, the burn rate is increasing, necessitating substantial future funding with no guarantee of success.

Positives

• Revenue increased by 131.9% to $41,748 for the six months ended June 30, 2025, compared to $18,000 in the prior year period.
• The company received FDA Breakthrough Device designation for RadioGel in December 2023, potentially accelerating regulatory review.
• Expansion of intellectual property with a new provisional patent filed in January 2025 for PrecisionGel, covering retention, transport, and release of various agents.
• Secured a distribution contract with Akina, Inc. for PrecisionGel, which is now in their catalog.
• Increased cash balance to $2,660,590 as of June 30, 2025, from $2,212,548 at December 31, 2024.
• Successful capital raise of $1,506,250 in H1 2025 through Regulation A+ Offerings and warrants.

Negatives

• Net loss widened significantly to $(1,480,209) for the six months ended June 30, 2025, from $(1,061,997) in the prior year period.
• Gross profit turned into a loss of $(43,835) in H1 2025, compared to a profit of $1,220 in H1 2024, primarily due to a substantial increase in Cost of Goods Sold.
• Operating expenses increased by 35.8% to $1,494,470 in H1 2025, reflecting higher professional fees, R&D, and general & administrative costs.
• The company's independent registered public accounting firm expressed substantial doubt about its ability to continue as a going concern due to recurring losses, significant cash usage, limited revenue, and accumulated deficits.
• Requires approximately $3.0 million annually to maintain current operating activities and an additional $9.0 million over the next 36 months for strategic initiatives.
• Disclosure controls and procedures were deemed ineffective due to a material weakness related to proper segregation of duties.

Risks

• Substantial doubt about the company's ability to continue as a going concern due to recurring losses, significant cash usage, limited revenue, and accumulated deficits.
• Inability to obtain sufficient additional capital will require delaying business strategy implementation and may lead to cessation of operations.
• Dependence on future regulatory approvals (FDA classification as Class II or Class III devices) and potential requirements for additional studies, including clinical studies, which will impact timing and spending.
• Uncertainty regarding the timing of approvals and the nature of third-party arrangements for manufacturing, sales, distribution, and licensing.
• Reliance on strategic transactions (licensing, partnerships) or additional capital raises for funding, with no assurance of availability on acceptable terms.
• Potential impact of geopolitical events, instability, and volatility in global capital markets on financing and business plan execution.
• Material weakness in disclosure controls and procedures related to proper segregation of duties, which could affect the reliability of financial reporting.
• Customer concentration risk, with three customers accounting for all revenues and two customers representing 100% of accounts receivable.

Future Outlook

The company intends to expand its indications for use for RadioGel/IsoPet in phases, targeting lymph nodes associated with thyroid cancer, cancerous lung nodules, and eventually all non-resectable solid tumors. It plans to fund activities through strategic transactions like licensing and partnerships or additional capital raises. Long-term goals include resuming research on other products like Gamma Gel and Alpha Gel, contingent on adequate funding, regulatory approvals, and successful commercialization.

Management Comments

• We intend to leverage both animal and human therapy, safety, and efficacy data for our FDA IDE application in the third quarter of 2025.
• We are targeting to increase sales in 2025 to achieve a Breakeven status for the Animal Therapy Division in 2026.
• We have decided to expand our presence in India and then to expand internationally. We are applying to become a Limited Liability Company in India in order to establish a business entity in India.
• We confirmed that our current isotope, Y-90 was effective for all the targeted indications for use. However, we also decided to explore P-32, Lu-177, and Ac-225.
• The Company anticipates that any near-term profits, if any, will be derived from direct sales of RadioGel (under the name IsoPet) and related services, and from certifying veterinary clinics to administer IsoPet Therapy.

Industry Context

Vivos Inc. operates in the niche but growing field of radiation oncology medical devices, specifically focusing on precision radionuclide therapy for non-resectable tumors. Its dual focus on both human and veterinary oncology, particularly with its Y-90 based RadioGel/IsoPet, positions it uniquely. The company's pursuit of FDA Breakthrough Device designation and expansion into international markets like India aligns with broader trends in medical device innovation and global market penetration for advanced cancer treatments. The exploration of alternative isotopes (P-32, Lu-177, Ac-225) indicates a strategic effort to broaden its product portfolio and address a wider range of cancer types and treatment scenarios, reflecting a common strategy in the highly competitive oncology space.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results for direct benchmarking.
• As a development-stage medical device company, Vivos Inc.'s recurring losses and significant cash burn are typical for companies in the R&D and regulatory approval phases, where substantial investment is required before commercialization.
• The company's strategy of seeking FDA Breakthrough Device designation is a recognized pathway for innovative medical devices to potentially accelerate regulatory review, similar to strategies employed by other biotech and med-tech firms aiming for faster market access.
• The expansion into veterinary oncology (IsoPet) and international markets (India) represents a diversification strategy, which can be a strength compared to companies solely focused on a single human indication or geographic market, though it also adds complexity and cost.
• The stated need for $3 million annually for operations and $9 million over 36 months for strategic initiatives is a substantial capital requirement, common for companies advancing through clinical trials and manufacturing scale-up in the medical device sector.

Corporate Governance

Related Party Transactions

• In December 2024, the Chief Executive Officer advanced $40,949 to the company, which was repaid within ten days.
• Cadwell Laboratories, controlled by a company director, provides office space to management on an as-needed basis.

Stakeholder Impact

• Shareholders: Significant dilution risk from ongoing and future capital raises (Regulation A+ Offerings). Continued net losses and going concern doubt pose substantial investment risk. Potential upside if regulatory approvals are achieved and products commercialized successfully.
• Employees: Continued employment is dependent on the company's ability to secure additional funding and achieve profitability. CEO's employment contract renewed, indicating stability at the top.
• Customers (Veterinarians/Clinics): Expansion of IsoPet certification program and potential for increased treatments. New production facility could improve supply reliability.
• Suppliers/Creditors: Risk of delayed payments or non-payment due to the company's going concern issues and reliance on future financing.
• Patients (Animals/Humans): Potential for new treatment options for non-resectable tumors if RadioGel/IsoPet achieves regulatory approvals and commercialization.

Next Steps

• Leverage animal and human therapy data for FDA Investigational Device Exemption (IDE) application in Q3 2025.
• Pursue an expanded permit from the DCGI to conduct human clinical trials for commercial applications in India at a second hospital with a new investigator.
• Apply to become a Limited Liability Company in India to establish a business entity.
• Initiate animal therapy in India with interested veterinary clinics.
• Negotiate a contract for space at Applied Process Engineering Laboratory (APEL) for a second domestic production facility and automated production development.
• Conduct laboratory testing, then animal and human studies in India for alternative isotopes (P-32, Lu-177, Ac-225) over the next two years.
• Expand indications for use in phases: first, for lymph nodes associated with thyroid cancer; secondly, cancerous lung nodules; and finally, all non-resectable solid tumors.
• Outsource material aspects of manufacturing, distribution, sales, and marketing within the U.S. following regulatory approvals and financing.
• Pursue licensing arrangements and/or partnerships outside the U.S. for global commercialization.
• Consider resuming research efforts for other products and technologies like Gamma Gel and Alpha Gel long-term, subject to funding and regulatory approvals.

Key Dates

Recommendation

Despite some revenue growth and strategic initiatives, the company's financial health is deteriorating rapidly, evidenced by a widening net loss, a shift to gross loss, and an increasing cash burn from operations. The explicit 'going concern' warning from auditors, coupled with substantial future capital requirements ($9 million over 36 months) and no guarantee of securing it, indicates an extremely high risk of financial distress or failure. The material weakness in internal controls further exacerbates concerns about financial reporting reliability. While the technology has potential, the current financial trajectory and operational risks make this a highly speculative investment with significant downside.

Keywords

Vivos Inc, RadioGel, IsoPet, Precision Radionuclide Therapy, Yttrium-90, Radiation Oncology, Medical Device, Cancer Treatment, Veterinary Oncology, Human Clinical Trials, FDA Approval, Biotechnology, Healthcare, Oncology, Brachytherapy, Hydrogel, Regulation A+ Offering