Executive Summary

Q1 2022 was dominated by litigation resolution and financing: net loss was $2.2M ($0.20 per share) as legal costs drove higher G&A; cash at quarter-end was $0.7M, with $5.1M raised post-quarter to fund clinical progress .
The company settled a long-running wrongful death lawsuit on April 27, 2022 (no admission of liability), structured indemnification via a preferred issuance agreement with Harvard Bioscience, and expects ~$1.5M remaining obligations after HBIO pays ~$4M by end-Q2 2022 .
Strategic progress: FDA-approved trial design (up to 10 patients, 5 hospitals), new U.S. patent expanding IP to bronchus applications (8th U.S. patent), and reiterated goals to relist on NASDAQ and begin the clinical trial .
Stock reaction catalysts: clearing litigation overhang; fresh capital to initiate the first patient in the FDA-approved trial; expanded IP; and reiterated NASDAQ relisting ambitions .

What Went Well and What Went Wrong

What Went Well

Resolved a multi-year wrongful death litigation without admission of liability, removing a material overhang and clarifying remaining obligations structure through HBIO indemnification and preferred equity issuance .
Closed a $5.1M private placement post-quarter to accelerate BEI clinical development (854,771 shares + 427,390 warrants at $5.92 per unit), extending cash runway to fund operations through Q1 2023 .
Strengthened IP: issued a new U.S. patent covering bronchus applications, bringing total to 8 U.S. patents (plus 2 in China), supporting potential expansion beyond esophageal indications; management emphasized first-in-human esophageal regeneration at Mayo Clinic and robust porcine data .

What Went Wrong

Net loss widened year over year due to elevated legal and related costs: Q1 2022 net loss $2.2M vs. $0.9M in Q1 2021; G&A increased by $1.4M, while grant income declined by $0.1M .
Ongoing cash burn and stockholder deficit: operating cash used in Q1 2022 was $0.5M; total liabilities rose to $9.1M with stockholders’ deficit of $(5.0)M at March 31, 2022, reflecting accruals and financing advances .
No revenue and continued pre-commercial status; near-term execution hinges on clinical initiation and further capital formation including relisting plans, which management framed as current goals rather than completed milestones .

Financial Results

Quarterly Trend (oldest → newest)

Metric	Q2 2021	Q3 2021	Q4 2021	Q1 2022
Net Loss ($USD Millions)	$0.38	$0.85	$5.87	$2.18
Basic & Diluted EPS ($)	$(0.04)	$(0.08)	$(0.55)	$(0.20)
R&D Expense ($USD Millions)	$0.30	$0.25	$0.57	$0.30
G&A Expense ($USD Millions)	$0.62	$0.57	$5.33	$1.90
Total Operating Expenses ($USD Millions)	$0.92	$0.82	$5.90	$2.21
Cash And Equivalents ($USD Millions)	$0.45	$2.00	$1.24	$0.72

Notes: Company did not report product revenue in these periods; press releases present operating expenses and other income only, indicating pre-revenue status .

Q1 Year-over-Year Comparison

Metric	Q1 2021	Q1 2022
Net Loss ($USD Millions)	$0.87	$2.18
Basic & Diluted EPS ($)	$(0.09)	$(0.20)
R&D Expense ($USD Millions)	$0.47	$0.30
G&A Expense ($USD Millions)	$0.52	$1.90
Total Operating Expenses ($USD Millions)	$1.00	$2.21
Cash And Equivalents ($USD Millions)	n/a	$0.72
Cash Used in Operations ($USD Millions)	n/a	$0.50
Weighted Avg. Shares (Millions)	9.39	10.76

Estimate comparisons: S&P Global consensus estimates were unavailable for HRGN for Q1 2022 (attempted retrieval; access limit exceeded). Values would be retrieved from S&P Global if accessible.

Balance Sheet Snapshot (Q1 2022)

Metric	Q1 2022
Other Liabilities ($USD Millions)	$2.83
Accrual for Contingency ($USD Millions)	$3.25
Advance from Private Placement ($USD Millions)	$3.06
Total Liabilities ($USD Millions)	$9.14
Stockholders’ Deficit ($USD Millions)	$(4.97)
Restricted Cash ($USD Millions)	$3.11

Cash Flow and Non-GAAP/Non-cash Notes

Cash used in operations: $0.5M in Q1 2022 .
Non-cash items: ~$0.3M related to share-based compensation and depreciation in Q1 2022 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Cash Runway	FY 2022–Q1 2023	“Operating cash on-hand will fund expenses into early Q3 2022” (as of Dec 31, 2021)	“Sufficient to fund operating expenses and capex through Q1 2023” (post $5.1M raise)	Raised/Extended
Litigation Resolution & Obligations	2022	Accrued ~$3.3M contingency; rising legal costs; ongoing litigation	Settled Apr 27, 2022; HBIO expected to pay ~$4.0M by end-Q2; preferred issuance agreement; remaining obligations estimated ~$1.5M	Clarified/Resolved
Financing	2022	$2.8M raised in 2021; plan to raise capital	Closed $5.1M private placement on May 12, 2022 to advance BEI clinical trial	Executed
NASDAQ Relisting	2022	Goal to uplist from OTC to NASDAQ	Near-term goal reiterated: raise additional capital and relist on NASDAQ	Maintained
Clinical Trial Initiation	2022	FDA approval to commence BEI trial; preparing	FDA-approved design (up to 10 patients in up to 5 U.S. hospitals); management focused on treating first patient post-financing	Timeline Clarified

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2: Q3 2021)	Previous Mentions (Q-1: Q4 2021)	Current Period (Q1 2022)	Trend
Regulatory/Legal	No settlement; routine disclosures	Accrued ~$3.3M contingency and higher legal costs	Settled wrongful death claim; structured indemnification; remaining ~$1.5M obligations	Improving (overhang removed)
Financing & Cash	Raised $2.6M YTD via private placements; cash $2.0M	Raised $2.8M in 2021; cash $1.2M	Raised $5.1M in May; cash $0.7M at Q1; runway through Q1 2023	Strengthening
Clinical Execution	Planning; no call	FDA approval to commence trial	Emphasis on initiating first patient; trial up to 10 patients/5 hospitals	Advancing toward initiation
Intellectual Property	Emphasis on Cellframe/Cellspan platform	7 issued U.S. patents	New U.S. patent adds bronchus; total 8 U.S. patents; 2 China	Strengthening
R&D Spend & Grants	R&D down; grant income up in Q3	R&D up; SBIR grant expired (lower grant income)	R&D down YoY; grant income lower	Mixed
Capital Markets/Uplisting	Not highlighted	Goal to uplist to NASDAQ	Active plan to relist post-capital raise	Maintained

Management Commentary

“We settled a lawsuit that had been outstanding against us for almost five years… settled without any admission of liability or wrongdoing.”
“We recently closed… a private placement… for approximately $5.1 million.”
“We performed the first ever regeneration of an esophagus in a human cancer patient… Mayo Clinic… paper concluded the Biostage esophageal implant ‘Would have considerable clinical use.’ Other surgeons have described our product as ‘Revolutionary’ or ‘A breakthrough.’”
“The FDA approved our clinical trial for a maximum 10 patients in up to 5 hospitals… measures both safety and efficacy… more similar to a miniature Phase 3 trial than a typical Phase 1.”
“Current and short-term goals are to raise additional capital to relist on NASDAQ, and to begin the clinical trial.”
“Our net loss was approximately $2.2 million or $0.20 per basic and diluted share… includes approximately $0.3 million of non-cash items…”

Q&A Highlights

The transcript provided prepared remarks only; a distinct analyst Q&A section was not included in the retrieved content .
Financial clarifications were given in prepared remarks (non-cash items; cash runway; litigation obligations) .

Estimates Context

S&P Global Wall Street consensus for Q1 2022 EPS and revenue was unavailable for HRGN at the time of retrieval due to access limits. Values would be retrieved from S&P Global; absent data precludes beat/miss determination.
Implications: With no reported revenue and a widened loss driven by litigation costs, future estimate revisions (if any coverage exists) may hinge on timing of trial initiation and incremental financing.

Key Takeaways for Investors

Litigation resolution and structured indemnification remove a major overhang and clarify remaining cash obligations (~$1.5M after HBIO pays ~$4M), reducing uncertainty ahead of trial initiation .
The $5.1M private placement extends runway through Q1 2023 and funds clinical execution, a key near-term catalyst as the company aims to treat the first patient in its FDA-approved trial .
Expanded IP (8th U.S. patent; bronchus application) strengthens defensibility and opens potential indications beyond BEI, supporting longer-term optionality .
Operating profile remains pre-revenue with quarterly loss driven by legal costs; monitoring G&A normalization post-settlement is critical for assessing cash burn trajectory .
Uplisting ambition to NASDAQ could broaden investor access and liquidity, contingent on capital formation and clinical progress .
Near-term trading setup: catalysts include first-patient treatment, site activations, and any regulatory or financing updates; absence of revenue means price action likely tied to clinical/regulatory headlines rather than fundamentals .
Medium-term thesis: If early clinical data corroborate first-in-human outcomes (Mayo Clinic) and porcine studies, BEI could address high-need esophageal indications; execution, capital discipline, and regulatory milestones are key to de-risking .

References:

Q1 2022 earnings press release and 8-K exhibits .
Q1 2022 earnings call transcript .
Prior quarters’ press releases and 8-K exhibits (Q4 2021, Q3 2021, Q2 2021) .

Harvard Apparatus Regenerative Technology, Inc. (HRGN)·Q1 2022 Earnings Summary