Modular Medical (MODD) is a development stage medical device company that designs and develops an insulin pump. The company is focused on addressing challenges related to the limited adoption of currently available pumps for people with Type 1 diabetes.
Modular Medical Risk Factors
According to the new Tipranks Risk Factors tool, MODD’s main risk category is Finance & Corporate, which accounts for 49% of the total 43 risks identified. The next two major risk factor contributors are Legal & Regulatory and Tech & Innovation at 19% and 14%, respectively. Since March, the company has added two new risk factors under Finance & Corporate category.
In the past, MODD has not held regular annual meetings of shareholders. Regulations in Nevada provide that if an annual meeting is not held for a duration of 18 months since the last election of directors, investors owning at least 15% of voting power can apply in the Nevada district court to order the election of directors. Such a situation can result in unanticipated expenditure of funds, time, and other resources.
The second key risk is that being in the development stage, the company does not generate any revenue and is under substantial debt. This may impact its financial position and the capacity to raise additional funds or meet its financial obligations.
Now let us dive into the company’s financial performance for Fiscal Year 2021. Owing to higher headcount and consulting costs, the R&D expenses of MODD increased 34.6% year-over-year to $4.1 million. It expects R&D expenses to increase further in fiscal 2022 as MODD advances product development and a low-volume manufacturing process.
General and administrative expenses of the company also increased 40.6% year-over-year to $3.2 million. Net loss per share widened to $0.40 from $0.30 a year ago. (See Modular Medical stock chart on TipRanks)
Compared to the sector average Finance & Corporate risk factor of 28%, MODD is at 48.8%. This indicates that owning the stock is riskier versus the broader sector. Shares are up 44.7% over the past year.