Vivani Medical, Inc. (NASDAQ:VANI) is a preclinical stage biopharmaceutical company that is pioneering the development of innovative, miniaturized, subdermal implants utilizing its proprietary NanoPortal™ technology. This groundbreaking platform enables the long-term, near constant-rate delivery of a broad range of medicines to treat chronic diseases, addressing a critical issue of medication non-adherence.

Business Overview

Vivani's core focus is on developing a portfolio of miniature, sub-dermal drug implant candidates that are designed to guarantee medication adherence by delivering therapeutic drug levels for up to 6 months or longer. Unlike most oral and injectable medicines, these implants aim to minimize fluctuations in patients' drug levels, which can improve the tolerability profiles for medications that produce side effects associated with fluctuating drug concentrations in the blood.

The company's lead program, NPM-115, is a miniature, 6-month GLP-1 (exenatide) implant candidate for chronic weight management in obese or overweight patients with one or more risk factors. In February 2024, Vivani announced positive preclinical weight loss data from its exenatide implant, which was comparable to semaglutide injections (the active pharmaceutical ingredient in Ozempic®/Wegovy®). This data supported the company's strategic shift to prioritize its obesity portfolio.

In parallel, Vivani is also advancing the development of its pioneering neurostimulation systems from its legacy company, Second Sight. In December 2022, the company contributed these assets and certain liabilities to its wholly-owned subsidiary, Cortigent, Inc., which is now pursuing the further development of this technology.

Financials

Vivani's financial performance has been characterized by recurring operating losses and negative operating cash flows since inception. For the fiscal year ended December 31, 2023, the company reported an annual net loss of $25,652,000, with no revenue generated. Its annual operating cash flow was -$23,699,000, and annual free cash flow was -$24,586,000.

In the first quarter of 2024, Vivani continued to report significant losses, with a net loss of $6,039,000. The company's quarterly operating cash flow was -$4,512,000, and quarterly free cash flow was -$4,694,000. These financial results reflect the company's ongoing investment in research and development activities to advance its pipeline of innovative drug implant candidates.

Vivani has financed its operations primarily through the recurring sale of its equity securities. On March 1, 2024, the company entered into a securities purchase agreement with an institutional investor, raising $15.0 million in gross proceeds through the issuance of common stock and warrants. After deducting issuance costs, the company received net proceeds of $13.7 million from this transaction.

The company estimates that its currently available cash will provide sufficient funds to enable it to meet its planned obligations into the second half of 2025. However, Vivani's ability to continue as a going concern is dependent on its ability to raise additional capital and/or develop profitable operations through the implementation of its business initiatives. There can be no assurances that the company will be able to do so.

Operational Highlights and Outlook

In July 2023, Vivani filed an Investigational New Drug (IND) application with the U.S. Food and Drug Administration (FDA) for its NPM-119 GLP-1 implant for the treatment of type 2 diabetes, named LIBERATE-1. However, in August 2023, the FDA placed the LIBERATE-1 study on full clinical hold, primarily due to insufficient Chemistry, Manufacturing, and Controls (CMC) information to assess the risk to human subjects. Vivani remains on track to provide the FDA with the requested CMC information associated with the current clinical hold on NPM-119 during the first half of 2024.

As a result of reprioritizing the focus of its GLP-1 implants on the treatment of obesity and chronic weight management, Vivani has shifted its near-term development efforts to the NPM-115 program. The company expects to initiate the first clinical study for the NPM-115 program in Australia in the fourth quarter of 2024, pending regulatory clearance in that country.

The NPM-115 clinical program will evaluate the investigational 6-month GLP-1 implant for chronic weight management in patients who are either obese or overweight with a related comorbidity. The first study, named LIBERATE-1, will be a randomized investigation of the safety, tolerability, and pharmacokinetic profile of the exenatide NanoPortal implant in this patient population.

LIBERATE-1 will enroll patients who will be titrated on weekly semaglutide injections (Wegovy®) for 8 weeks before being randomized to receive a single administration of Vivani's exenatide implant, weekly exenatide injections Bydureon BCise®, or weekly 1 mg semaglutide injections for a 9-week treatment duration. Changes in weight will be the primary outcome measure, and the trial is expected to initiate later this year, with data projected to be available in 2025.

Vivani's strategic shift to prioritize its obesity portfolio is in response to the significant medical need and unprecedented market demand for effective chronic weight management solutions. The company believes the results of the LIBERATE-1 study may provide clinical validation of its NanoPortal drug delivery technology and support a broader application of the technology in the treatment of other chronic diseases.

Risks and Challenges

Vivani faces several risks and challenges as a preclinical stage biopharmaceutical company. The company's ability to successfully develop and commercialize its product candidates is subject to various regulatory, clinical, manufacturing, and commercialization risks. Delays or setbacks in the development of its product candidates, such as the clinical hold on the NPM-119 program, could have a material adverse impact on the company's financial condition and prospects.

Additionally, Vivani's limited operating history, recurring operating losses, and negative operating cash flows raise substantial doubt about its ability to continue as a going concern. The company's future capital funding requirements and its ability to obtain additional financing on favorable terms, or at all, are critical to its continued operations and the successful execution of its business strategy.

Conclusion

Vivani Medical, Inc. is an innovative biopharmaceutical company that is pioneering the development of miniaturized, subdermal implants designed to transform the management of chronic diseases. With its strategic focus on obesity and its promising pipeline of long-term drug delivery solutions, the company is well-positioned to address significant unmet medical needs and capitalize on the growing demand for effective chronic disease treatments.

Despite the challenges and risks inherent in its preclinical stage, Vivani's unique NanoPortal technology and its commitment to advancing its obesity portfolio make it a compelling investment opportunity for investors seeking exposure to the rapidly evolving chronic disease management landscape.