☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Delaware		85-1388175
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

530 Old Whitfield Street
Guilford, Connecticut		06437
(Address of principal executive offices)		(Zip Code)

Title of each class		Trading Symbols(s)		Name of each exchange on which registered
Class A common stock, $0.0001 per share		QSI		The Nasdaq Stock Market LLC
Redeemable warrants, each whole warrant exercisable for one share of Class A common stock, each at an exercise price of $11.50 per share		QSIAW		The Nasdaq Stock Market LLC

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

			Page
		Cautionary Note Regarding Forward-Looking Statements	3
Part I			5
	Item 1.	Business	5
	Item 1A.	Risk Factors	29
	Item 1B.	Unresolved Staff Comments	60
	Item 2.	Properties	60
	Item 3.	Legal Proceedings	60
	Item 4.	Mine Safety Disclosures	60
Part II			61
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	61
	Item 6.	[Reserved]	61
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	62
	Item 7A.	Quantitative and Qualitative Disclosures About Mark Risk	74
	Item 8.	Financial Statements and Supplementary Data	74
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	74
	Item 9A.	Controls and Procedures	74
	Item 9B.	Other Information	75
	Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	75
Part III			76
	Item 10.	Directors, Executive Officers and Corporate Governance	76
	Item 11.	Executive Compensation	76
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	76
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	76
	Item 14.	Principal Accountant Fees and Services	76
Part IV			77
	Item 15.	Exhibits and Financial Statement Schedules	77
	Item 16.	Form 10-K Summary	80
		Signatures	81

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the ability to recognize the benefits of the Business Combination (as defined below), which may be affected by, among other things, competition and our ability to grow and manage growth profitably and retain our key employees;

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the ability to maintain the listing of our Class A common stock on The Nasdaq Stock Market LLC (“Nasdaq”);

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changes in applicable laws or regulations;

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our ability to raise financing in the future;

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the success, cost and timing of our product development activities;

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the commercialization and adoption of our existing products and the success of any product we may offer in the future;

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the potential attributes and benefits of our commercialized PlatinumTM protein sequencing instrument and our other products once commercialized;

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our ability to obtain and maintain regulatory approval for our products, and any related restrictions and limitations of any approved product;

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our ongoing leadership transition;

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our ability to identify, in-license or acquire additional technology;

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our ability to maintain our existing license agreements and manufacturing arrangements;

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our ability to compete with other companies currently marketing or engaged in the development of products and services that serve customers engaged in proteomic analysis, many of which have greater financial and marketing resources than us;

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the size and growth potential of the markets for our products, and the ability of each product to serve those markets once commercialized, either alone or in partnership with others;

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our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;

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our financial performance; and

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the impact of the COVID-19 pandemic on our business.

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We are an early-stage life sciences technology company with a history of net losses, which we expect to continue, and we may not be able to generate meaningful revenues or achieve and sustain profitability in the future.

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We have a limited operating history, which may make it difficult to evaluate the prospects for our future viability and predict our future performance.  As such, you cannot rely upon our historical operating performance to make an investment or voting decision regarding us.

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We may need to raise additional capital to fund commercialization plans for our products, including manufacturing, sales and marketing activities, expand our investments in research and development, and commercialize new products and applications.

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If we experience material weaknesses in our internal control over financial reporting in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to report our financial condition, results of operations or cash flows accurately or in a timely manner, which may adversely affect investor confidence in us and, as a result, materially and adversely affect our business and the value of our Class A common stock.

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We recently commercially launched our first product, but we may not be able to successfully commercially launch our products as planned.

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Because we are a “controlled company” within the meaning of the Nasdaq rules, our stockholders may not have certain corporate governance protections that are available to stockholders of companies that are not controlled companies.

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The dual class structure of our common stock has the effect of concentrating voting power with Jonathan M. Rothberg, Ph.D., our Chairman of the board of directors and Founder, which will limit an investor’s ability to influence the outcome of important transactions, including a change in control.

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Our success depends on broad scientific and market acceptance of our products, which we may fail to achieve.

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The size of the markets for our products may be smaller than estimated, and new market opportunities may not develop as quickly as we expect, or at all, limiting our ability to successfully sell our products.

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Unfavorable global economic conditions could adversely affect our business, financial condition or results of operations.

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The COVID-19 pandemic and efforts to reduce its spread have adversely impacted, and are expected to continue to materially and adversely impact, our business and operations.

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If we do not sustain or successfully manage our anticipated growth, our business and prospects will be harmed.

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We are undertaking internal restructuring activities that could result in disruptions to our business or otherwise materially harm our results of operations or financial condition.

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We are currently undergoing a leadership transition and internal restructuring, and we depend on our key personnel and other highly qualified personnel, and if we are unable to recruit, train and retain our personnel in the future, we may not achieve our goals.

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We expect to be dependent upon revenue generated from the sales of our initial products from the time they are commercialized through the foreseeable future.

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We rely on a small number of contract manufacturers to manufacture and supply our products. If these manufacturers should fail or not perform satisfactorily, our ability to commercialize and supply our products would be adversely affected.

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If we do not successfully develop and deploy our Quantum-Si Cloud™ software service, our commercialization efforts and therefore business and results of operations could suffer.

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We have limited experience producing and supplying our products, and we may be unable to consistently manufacture or source our instruments and consumables to the necessary specifications or in quantities necessary to meet demand on a timely basis and at acceptable performance and cost levels.

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The life sciences technology market is highly competitive. If we fail to compete effectively, our business and results of operations will suffer.

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If we elect to label and promote any of our products as clinical diagnostics or medical devices, we would be required to obtain prior marketing authorization from the U.S. Food and Drug Administration (“FDA”), which would take significant time and expense and could fail to result in FDA marketing authorization of the device for the intended use or uses we believe are commercially attractive.

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Our products, if used for the diagnosis of disease, could be subject to government regulation, and the regulatory approval and maintenance process for such products may be expensive, time-consuming, and uncertain both in timing and in outcome.

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Our research use only (“RUO”) products could become subject to government regulation as medical devices by the FDA and other regulatory agencies even if we do not elect to seek regulatory authorization to market our products for diagnostic purposes, which would adversely impact our ability to market and sell our products and harm our business.

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If we are unable to obtain and maintain and enforce sufficient intellectual property protection for our products and technology, or if the scope of the intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize products similar or identical to ours, and our ability to successfully commercialize our products may be impaired.

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We may not be able to protect our intellectual property rights throughout the world.

ITEM 1.

BUSINESS

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Personalized medicine:  tailoring of disease treatment based real-time proteomic data;

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Biomarker discovery:  identification of protein markers for disease identification;

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Drug discovery and development:  identification of potential drug candidates and aid in the development of the drug;

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Systems biology:  system-wide investigations of disease pathways to identify biomarkers, drug action, toxicity, efficacy and resistance;

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Industry / agriculture:  bioproduction and study of plant-pathogen interaction (e.g. crop engineering for drought resistance); and

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Food science:  identification of allergies, understanding an improvement of nutritional values and food quality and safety control.

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Lower-plex methods.  Lower-plex proteomic analysis methods include immunoassay, Gel, and chromatography-based methods.  Immunoassay based methods rely on the availability of antibodies targeting specific proteins or epitopes as a way to identify and quantify protein expression levels.  Changes or modifications to the protein may prevent the antibody from binding, resulting in missed identification.  Gel based methods like Western blots were the first proteomic technique developed.  They utilize an electric current to separate proteins in a gel based on their size and charge, prior to further analysis by a MS instrument.  Chromatography based methods use ion-exchange chromatography to separate and purify proteins from complex biological mixtures.  The purified proteins can then be analyzed using a MS.

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Higher-plex methods.  Higher-plex proteomic analysis methods include protein microarrays and MS instruments.  Existing high-plex proteomic technologies, however, often have tradeoffs between sensitivity and dynamic range — current technologies that are able to analyze the proteome at higher plex, often do so with lower sensitivity and resolution.  Specificity is also a key consideration when multiplexing (analyzing multiple proteins in the same sample). Protein microarrays apply small amounts of sample to a “glass chip” where specific antibodies are used to capture target proteins to measure the expression levels and binding affinities of proteins.  The most common way researchers currently analyze proteins is through the use of MS.  MS is a method for the mass determination and characterization of proteins, and its direct applications include protein identification and post-translational modifications, elucidation of protein complexes, their subunits and functional interactions, as well as global measurement of proteins in proteomics.  Some newer technologies have addressed certain limitations of these methods, yet still require separate peptide drying or are reliant on existing MS instruments.  With an estimated 16,000 MS instruments installed worldwide specifically for proteomics analysis, we believe the cost of $250,000 to $1,000,000 or more per new instrument, according to research by DeciBio, LLC, limits access to proteomics research and we believe currently limits the size and growth of the overall proteomics industry.

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Limitations of biased approaches.  Typical workflows rely on analyte-specific reagents (ASRs) for protein detection.  ASRs comprise a variety of molecules, such as antibodies or aptamers, which bind to specific regions, rather than individual amino acids, and therefore may not detect the presence of a known protein variants.  For instance, the average binding site of an ASR is an epitope with a length of five (5) to eight (8) amino acids, whereas the average length of a human protein is approximately 470 amino acids.  While ASRs are prevalent and readily available, inherent limitations in how these molecules interact with proteins for various detection platforms limit their use for resolving protein sequences at single amino acid resolution.

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Mass spectrometry tools have a high cost of purchase and ownership.  For more than a decade, MS has been the dominant tool for an unbiased approach to protein analysis.  Shotgun proteomics, or studying pieces of proteins that have been broken apart, typically utilizes MS and MS workflows, allowing for the interrogation of individual peptides and protein sequences.  However, these techniques are generally complex, lengthy, expensive, laborious and require extensive data analysis.  Taken together, these factors limit the scalability of this approach and broad adoption of the technology in the market.  Comparatively, targeted or biased methods like protein arrays are scalable but only enable interrogation of a fixed number of targeted proteins per sample.  Biased approaches lack the capabilities necessary to catalog new protein variants.  Users are therefore forced to choose between breadth with MS or scalability with other biased technologies, or limited alternatives that can address both needs.

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Low levels of resolution and sensitivity.  We believe successful technologies for use in broad proteomic and clinical testing generally require high levels of specificity and sensitivity as well as the ability to scale to reliably meet volume demand.  Current sensitivity and dynamic range restrictions make legacy technologies, such as MS, difficult to use with liquid samples and restrict the ability to analyze at single molecule resolution.

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There is no end-to-end platform to enable a true sample-to-answer assays.  While there have been some improvements to proteomic technologies, there remain numerous key limitations in typical proteomic analysis.  Experiments often require input and oversight from highly trained MS scientists, which often requires specialty training for both MS instrument operation and data analysis.  Further, these workflows can be tedious and require extensive hands-on-time to perform, inherently limiting sample throughput.

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Costly and complex data analysis.  We believe the critical unmet needs remaining in proteomic analysis relate to cost, accessibility and simplicity.  Given the complex and dynamic aspects of proteins, proteomic analysis can generate vast amounts of data that can be difficult to analyze to arrive at a biologically relevant answer.  Currently, the complexity of the analysis is also costly, due to the data processing and analysis infrastructure that is often required.

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Transport and meter out small volumes of reagents/samples between reservoirs;

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Perform chemical or enzymatic incubations with or without temperature control;

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Purify target analyte; and

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Automate sample prep through to library creation.

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What protein is present?  Amino acid resolution can provide insight into more than just whether a protein is present or absent.  The sequence information could also indicate what version of the protein is present and how it has been changed from the normal version.

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How much of the protein is present?  A digital quantification provides precise protein abundance, not an analog theoretical abundance based on a colorimetric or mass abundance readout.

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How has the protein been modified?  Single-molecule sensitivity could show how the protein has been post-translationally modified thus providing greater insights to its role in the context of biological processes within the cell.

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User management for secured data access;

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Light-weight library information management system for data management;

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Multi-tenancy to enable data sharing and collaborations; and

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Differentiated single molecule detection providing the ultimate level of protein sensitivity and specificity.  Our platform is based on our proprietary semiconductor chip designed to enable measurements at the ultimate level of sensitivity and specificity, single molecules.  By enabling single molecule detection, we are not reliant on ensemble measurements, which can often vary from sample to sample and even run to run.

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Amino acid resolution and Post-Translational Modification (PTM) detection.  Moving beyond simple confirmatory information provided by affinity-based platforms, our platform delivers amino acid resolution shifting the output from analog to digital. The ability to also identify PTMs could provide novel insights into how pathways are turned on/off to improve our understanding of the estimated 1 million + proteoforms.

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Real-time data processing and Cloud platform provides fast, simple data analysis.  During sequencing our Platinum instrument is designed to stream data to the cloud in real-time, which could allow for faster time to results.  In addition, we have developed our cloud-based platform to provide key tools needed to streamline use of the platform such as secure access, data management, and an open platform where developers can create new analytical workflows to run in our cloud and share them easily with other users.

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Innovative proprietary end-to-end proteomic platform offering differentiated full suite of protein sequencing solutions.  We believe that our platform will enable full end-to-end proteomics workflow solution spanning sample preparation through protein sequencing and analysis, allowing our customers a seamless opportunity to perform proteomic studies at scale.  We also believe that we are the first company to successfully enable NGPS.  We believe the digital nature of our readout provides an accurate and repeatable quantification of proteins in the sample and could scale to enable millions of data points working at the ultimate level of sensitivity — single molecule resolution.

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Platform to enable democratized access to proteomics tools.  Our platform is designed to provide an easy-to-use workflow with the potential to enable users the ability to better characterize and understand the full complexity of the proteome in an unbiased fashion.  Current workflows are typically disaggregated, expensive, require significant training to operate, and are often performed in a separate specialty laboratory.  We aim for our technology platform to be broadly available across pharmaceutical and academic research centers, basic research labs, and other healthcare centers and clinical laboratories (for RUO until appropriate regulatory authorization is secured to allow clinical or diagnostic uses) at a price point that is a significant discount to most legacy technologies.  The reduction in both cost and complexity could allow for rapid adoption, whether a user is replacing a legacy technology or buying a new instrument.  In addition to appealing to users of existing proteomics tools, we believe that our proteomics platform will appeal to users of DNA sequencing technologies who seek to augment their research and discovery of biomarkers and further deepen their understanding of biology.

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Robust patent protection.  We have a strong intellectual property strategy in which we have 214 issued patents and 797 pending applications as of December 31, 2022.  Many from our management team worked directly with our Founder, Dr. Jonathan Rothberg, as he revolutionized the creation of next generation DNA sequencing while founding Ion Torrent, which was acquired by Life Technologies in 2010.  Our team has similarly devoted its efforts to revolutionizing unbiased proteomic analysis using a similar scientific and technical validation approach since our founding in 2013.

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Experienced Life Science Management team combined with a visionary founder and experienced financial partners with deep experience in healthcare.  We have a world-class management team, including our executive officers and other senior management, with decades of cumulative experience in the healthcare and life sciences end-markets.  Many members of the team worked directly with our Founder and Chairman, Dr. Jonathan Rothberg to successfully commercialize previous DNA sequencing technologies. Dr. Rothberg has dedicated his career to developing breakthrough technologies to revolutionize healthcare.  He has founded more than 10 healthcare technology companies and has received numerous awards, including the Presidential Medal of Technology & Innovation in 2016.  Dr. Rothberg previously founded 454 Life Sciences, a high throughput DNA sequencing platform which was later sold to Roche, as well as founded Ion Torrent, a next generation sequencing platform which was later sold to Life Technologies.  We believe this leadership team positions us as a potentially disruptive force in creating a new market of next generation protein sequencing.

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Systematic and phased approach to broad commercialization and adoption.  In December 2022, we launched Platinum™ for RUO. Members of our team have previously utilized a systematic approach designed to drive early adoption to successfully launch other disruptive sequencing technologies, including the roll out of Ion Torrent’s next generation DNA sequencing technology.  We believe this approach will allow us to introduce our platform in a structured manner to demonstrate its use and practicality, while working directly with our key potential customers and industry thought leaders to help ensure a positive experience.  Our core leadership team has decades of cumulative experience working directly in the life sciences industry with many of the companies and research centers that have the potential to become key customers and that we will seek to build into our prospective customer pipeline.

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Build our commercial infrastructure to help ensure successful initial commercial launch in the U.S.  We expect to build out our commercial and operational infrastructure to sell and support our platform as we commercialize our technology and gain traction. Our investments will be aligned with our initial traction in the Market. We also have manufacturing partnerships that we believe will allow us to rapidly expand our capacity, with the ability to create new manufacturing lines to meet potential customer demand.  In November 2021, we acquired Majelac, a semiconductor packaging company based in Garnet Valley, Pennsylvania. The acquisition brings our semiconductor chip assembly and packaging capabilities in-house in order to secure our supply chain and support our commercialization efforts.

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Invest in market development activities to increase awareness of the importance of the proteome and the strengths of our platform.  We believe our platform has the capability to enable users to generate significant amounts of proteomic information at speed, scale, and simplicity through a solution that until our launch, was not available.  We believe the utility of our platform will span basic and discovery applications and translational research in which there is a strong market need for proteomic analysis for novel discoveries and better insights into the complexity of disease.  We plan to invest in market development activities and partnerships to increase awareness of the importance and utility of proteomics to expand and accelerate demand for our products.

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Continued technical innovation to drive product enhancements, new products, and additional applications.  Our leadership team has deep expertise in scientific and technological development and commercialization.  After we commercialize our initial products, we aim to continually innovate and develop new products, product enhancements, applications, workflows, and other tools to enable our customers to generate unbiased proteomic information at scale on a benchtop platform.

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Accessibility and Enablement:  Enable broad adoption of protein sequencing.  Our mission is to democratize single molecule proteomic analysis by providing a full workflow of solutions at an affordable cost.  We believe that our platform will directly address many of the key bottlenecks that exist within legacy proteomic technologies, namely low sensitivity, lack of dynamic range, complex workflow, complex analysis, and high cost.  We believe our platform offers the potential for a more practical, affordable, and intuitive end-to-end workflow solution relative to many legacy proteomic technologies.  We have specifically developed our platform to be adopted and integrated into any existing lab.  We believe that our platform will have wide utility across the study of proteins, including basic and discovery research and, subject to regulatory authorization, clinical diagnostics, and potentially industrial applications like bioproduction.  Our ability to develop our platform such that it will be offered at a significant discount to many legacy instruments and other proteomic technologies, may allow proteomic analysis to reach new markets and new users, potentially enabling and accelerating innovative discoveries.

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Continue to strengthen our intellectual property portfolio for existing and new technologies.  We have a broad and deep patent protection strategy, which includes 214 issued patents and over 797 pending applications as of December 31, 2022.  Protection of our intellectual property is a strategic priority for the business.  We have taken, and will continue to take, steps to protect our current and future intellectual property and proprietary technology.  We believe our broad patent portfolio and continued rigorous patent protection strategy will help to allow us to focus on our key priorities of commercializing our platform, continuing to innovate with new technologies, and preventing fast-followers.

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Foster extraordinary talent inspired and unified by our mission.  With decades of cumulative experience in the healthcare and life sciences markets among our executive officers and other senior management, our world-class management team is unified by our mission to democratize single molecule proteomic analysis by making protein sequencing accessible globally.  We seek to execute at scale the vision of our Founder and Chairman, Dr. Jonathan Rothberg.  He has dedicated his career to enabling breakthrough technologies to revolutionize healthcare by bringing together talented, innovative people. We plan to continue to add talented and experienced members to our team and maintain our commitment to our mission of democratizing proteomic analysis by making protein sequencing accessible globally.

1.

Metered Launch:  In December 2022, we launched Platinum™ for RUO.  In our initial launch, we are targeting established academic research centers and pharmaceutical companies in the United States and Europe.  During our initial launch phase, we are focusing on driving our technology into research centers.  Our platform is currently intended for RUO applications, and it will continue to be marketed as RUO until regulatory authorizations allowing for clinical or diagnostic uses are obtained.  We are targeting customers that will directly benefit from the value of our platform across a number of applications, including basic and discovery research and translational research.  We anticipate these customers may already have existing proteomic capabilities through legacy instruments such as a MS, and so will understand the importance of single molecule, unbiased proteomic analysis.  During this phase, we expect to continue to strengthen our commercial organization and broaden our commercial footprint to support an increasing number of customers.

2.

Product Updates:  As we continue commercialization in 2023 and beyond, we expect to focus on building our installed base and expanding global access to our platform.  We expect to make product enhancements to our initial platform and to make them available to our new and then existing customers.  Potential improvements could include an increase in the capacity of our semiconductor chips or chemistry enhancements to our instruments, which may improve accuracy, coverage, speed and data output.

3.

Portfolio Expansion:  Ultimately, we plan to advance and develop new products and key applications designed to “scale up” our Platinum instrument to provide higher throughput and enable greater levels of data output and broader coverage of the proteome.  We also plan to “scale down” by eventually launching our Atto instrument, which will be a low cost, low throughput instrument, potentially creating a pathway to point of care testing.  We may also seek regulatory authorization for clinical or diagnostic use of our products.

Name		Position
Executive Officers
Jeffrey Hawkins		Chief Executive Officer and Director
Claudia Drayton		Chief Financial Officer
Patrick Schneider, Ph.D.		President and Chief Operating Officer
Grace Johnston, Ph.D.		Chief Commercial Officer
Michael P. McKenna, Ph.D.		Executive Vice President, Product Development and Operations
Christian LaPointe, Ph.D.		General Counsel and Corporate Secretary
Directors
Jonathan M. Rothberg, Ph.D.		Chairman of the Board of Directors
Vikram Bajaj, Ph.D.		Managing Director, Foresite Capital Management, LLC
Marijn Dekkers, Ph.D.		Founder and Chairman, Novalis LifeSciences LLC
Ruth Fattori		Managing Partner, Pecksland Partners Senior Advisor, Boston Consulting Group
Brigid A. Makes		Independent Consultant
Michael Mina, M.D., Ph.D.		Chief Science Officer, eMed
Kevin Rakin		Co-Founder and Partner, HighCape Capital

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resolution and sensitivity;

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cost of instruments and consumables;

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efficiency and speed of workflows;

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the scale required to address the complexity and dynamic range of the proteome;

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throughput to meet lab testing volume;

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reputation among customers and key thought leaders;

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innovation in product offerings;

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accuracy and reproducibility of results;

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strength of intellectual property portfolio;

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operational and manufacturing footprint;

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customer support infrastructure; and

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a leadership and commercial team with extensive execution and scientific background.

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Development of comprehensive product description and indications for use.

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Completion of extensive nonclinical tests and/or animal studies, performed in accordance with the FDA’s Good Laboratory Practice (“GLP”) regulations, as well as any performance standards or other testing requirements established by the FDA through regulations or device-specific guidance.

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Comprehensive review of one or more predicate devices and development of data supporting the new product’s substantial equivalence to such predicate devices.

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the product may not be safe or effective for its intended use(s) to the FDA’s satisfaction;

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the data from the applicant’s nonclinical studies and clinical trials may be insufficient to support approval;

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the manufacturing process or facilities that the applicant uses may not meet applicable requirements; and

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changes in FDA approval policies or adoption of new regulations may require additional data to demonstrate the safety or effectiveness of the device.

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the FDA, the IRB(s), or other regulatory authorities do not approve a clinical trial protocol or a clinical trial, or place a clinical trial on hold;

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participants do not enroll in clinical trials at the expected rate;

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participants do not comply with trial protocols;

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participant follow-up is not at the expected rate;

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participants experience adverse side effects;

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participants die during a clinical trial, even though their death may not be related to the investigational products;

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third-party clinical investigators decline to participate in a trial or do not perform a trial on the sponsor’s anticipated schedule or consistent with the clinical trial protocol, GCPs or other FDA requirements;

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the sponsor or third-party organizations do not perform data collection, monitoring and analysis in a timely or accurate manner or consistent with the clinical trial protocol or investigational or statistical plans;

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third-party clinical investigators have significant financial interests related to the sponsor or the study that the FDA deems to make the study results unreliable, or the sponsor or investigators fail to disclose such interests;

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unfavorable regulatory inspections of the sponsor’s clinical trial sites or manufacturing facilities, which may, among other things, require the sponsor to undertake corrective action or suspend or terminate the sponsor’s clinical trials;

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changes in governmental regulations or administrative actions applicable to the sponsor’s trial protocols;

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the interim or final results of the clinical trial are inconclusive or unfavorable as to safety or effectiveness; and

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the FDA concludes that the results from the sponsor’s trial and/or trial design are inadequate to demonstrate safety and effectiveness of the product.

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establishment registration and device listing;

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the QSR, which requires manufacturers, including third-party manufacturers, to follow design, testing, control, storage, supplier/contractor selection, complaint handling, documentation and other quality assurance procedures;

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labeling regulations, which govern the mandatory elements of the device labels and packaging (including Unique Device Identifier markings for certain categories of products);

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FDA’s prohibitions against the promotion of products for uncleared, unapproved or “off-label” uses and other requirements related to promotional activities;

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the MDR regulations, which require that manufacturers report to the FDA if a device may have caused or contributed to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur;

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voluntary and mandatory device recalls addressing problems when a device is defective and/or could be a risk to health;

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correction and removal reporting regulations, which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; and

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post-market surveillance regulations, which apply to certain Class II or III devices when necessary to protect the public health or to provide additional safety and effectiveness data for the device.

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Warning Letters or Untitled Letters that require corrective action;

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fines and civil penalties;

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unanticipated expenditures;

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delays in approving/clearing or refusal to approve/clear any of our future products;

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FDA refusal to issue certificates to foreign governments needed to export our products for sale in other countries;

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suspension or withdrawal of FDA approval or clearance (as may be applicable);

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product recall or seizure;

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partial suspension or total shutdown of production;

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operating restrictions;

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injunctions or consent decrees; and

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civil or criminal prosecution.

ITEM 1A.

RISK FACTORS

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the timing and amount of expenditures that we may incur to develop, commercialize or acquire additional products and technologies or for other purposes, such as the expansion of our facilities;

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changes in governmental funding of life sciences research and development or changes that impact budgets or budget cycles

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seasonal spending patterns of our customers;

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the timing of when we recognize any revenues;

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future accounting pronouncements or changes in our accounting policies;

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the outcome of any future litigation or governmental investigations involving us, our industry or both

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higher than anticipated service, replacement and warranty costs;

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the impact of the COVID-19 pandemic on the economy, investment in life sciences and research industries, our business operations, and resources and operations of our suppliers, distributors and potential customers; an

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general industry, economic and market conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors.

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the inability to establish the capabilities and value proposition of our products with key opinion leaders in a timely fashion;

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the potential need or desire to modify aspects of our products prior to entering into the second or third phases of our commercial launch plan;

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changing industry or market conditions, customer requirements or competitor offerings over the span of our commercial launch plan;

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delays in building out our sales, customer support and marketing organization as needed for each of the phases of our commercial launch plan; and

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delays in ramping up manufacturing, either internally or through our suppliers to meet the expected demand in each of the phases of our commercial launch plan.

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our ability to market and increase awareness of the capabilities of our products;

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the ability of our products to demonstrate comparable performance in intended use applications broadly in the hands of customers consistent with the early access limited release phase of our commercialization plan;

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our potential customers’ willingness to adopt new products and workflows;

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our product’s ease of use and whether it reliably provides advantages over other alternative technologies;

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the rate of adoption of our products by academic institutions, laboratories, biopharmaceutical companies and others;

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the prices we charge for our products;

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our ability to develop new products and workflows and solutions for customers;

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if competitors develop and commercialize products that perform similar functions as our products; and

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the impact of our investments in product innovation and commercial growth.

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our ability to attract, retain and manage the sales, marketing and customer service and support force necessary to commercialize and gain market acceptance of our products;

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the time and cost of establishing a specialized sales, marketing and customer service and support force; and

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our sales, marketing and customer service and support force may be unable to initiate and execute successful commercialization activities.

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decreases in government funding of research and development;

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changes to programs that provide funding to research laboratories and institutions, including changes in the amount of funds allocated to different areas of research or changes that have the effect of increasing the length of the funding process;

●

macroeconomic conditions and the political climate;

●

potential changes in the regulatory environment;

●

differences in budgetary cycles, especially government- or grant-funded customers, whose cycles often coincide with government fiscal year ends;

●

competitor product offerings or pricing;

●

market-driven pressures to consolidate operations and reduce costs; and

●

market acceptance of relatively new technologies.

●

required compliance with existing and changing foreign regulatory requirements and laws that are or may be applicable to our business in the future, such as the European Union’s General Data Protection Regulation (“GDPR”) and other data privacy requirements, labor and employment regulations, anti-competition regulations, the U.K. Bribery Act of 2010 and other anti-corruption laws, regulations relating to the use of certain hazardous substances or chemicals in commercial products, and require the collection, reuse, and recycling of waste from products we manufacture;

●

required compliance with U.S. laws such as the Foreign Corrupt Practices Act, and other U.S. federal laws and regulations established by the Office of Foreign Assets Control of the U.S. Department of the Treasury;

●

export requirements and import or trade restrictions;

●

laws and business practices favoring local companies;

●

foreign currency exchange, longer payment cycles and difficulties in enforcing agreements and collecting receivables through certain foreign legal systems;

●

changes in social, economic, and political conditions or in laws, regulations and policies governing foreign trade, manufacturing, research and development, and investment both domestically as well as in the other countries and jurisdictions in which we operate and into which it may sell our products including as a result of the separation of the United Kingdom from the European Union (“Brexit”);

●

potentially adverse tax consequences, tariffs, customs charges, bureaucratic requirements, and other trade barriers;

●

difficulties and costs of staffing and managing foreign operations; and

●

difficulties protecting, maintaining, enforcing or procuring intellectual property rights.

●

a failure to achieve market acceptance for our products or expansion of our product sales;

●

loss of customer orders and delay in order fulfillment;

●

damage to our brand reputation;

●

loss of revenue;

●

increased warranty and customer service and support costs due to product repair or replacement;

●

product recalls or replacements;

●

inability to attract new customers;

●

diversion of resources from our manufacturing and research and development team into our service team; and

●

legal claims against us, including product liability claims, which could be costly and time consuming to defend and result in substantial damages.

●

greater name and brand recognition;

●

greater financial and human resources;

●

broader product lines;

●

larger sales forces and more established distributor networks;

●

substantial intellectual property portfolios;

●

larger and more established customer bases and relationships; and

●

better established, larger scale and lower cost manufacturing capabilities.

●

the federal Anti-Kickback Statute, which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce either the referral of an individual or furnishing or arranging for a good or service, for which payment may be made, in whole or in part, under federal healthcare programs, such as Medicare and Medicaid. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation;

●

the federal civil and criminal false claims laws, including the federal civil False Claims Act, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid or other federal healthcare programs that are false or fraudulent. Private individuals can bring False Claims Act “qui tam” actions, on behalf of the government and such individuals, commonly known as “whistleblowers,” may share in amounts paid by the entity to the government in fines or settlement.

●

the federal Civil Monetary Penalties Law, which prohibits, among other things, offering or transferring remuneration to a federal healthcare beneficiary that a person knows or should know is likely to influence the beneficiary’s decision to order or receive items or services reimbursable by the government from a particular provider or supplier;

●

HIPAA, which created additional federal criminal statutes that prohibit, among other things, executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters;

●

the federal Physician Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, to report annually to CMS, information related to payments and other transfers of value to physicians (defined broadly to include doctors, dentists, optometrists, podiatrists and chiropractors), teaching hospitals and certain advanced non-physician healthcare practitioners, as well as ownership interests held by physicians and their immediate family members; and

●

analogous state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws, which may apply to items or services reimbursed by any third-party payor, including commercial insurers or patients.

●

the scope of rights granted under the license agreement and other interpretation-related issues;

●

our financial or other obligations under the license agreement;

●

whether, and the extent to which, our products, technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;

●

our diligence obligations under the license agreement and what activities satisfy those diligence obligations;

●

the inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensor(s); and

●

the priority of invention of patented technology.

●

others may be able to make products that are similar to products and technologies we may develop or utilize similar technology that are not covered by the claims of the patents that we own or license now or in the future;

●

we, or our licensor(s), might not have been the first to make the inventions covered by the issued patent or pending patent application that we license or may own in the future;

●

we, or our licensor(s), might not have been the first to file patent applications covering certain of our or their inventions;

●

others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing, misappropriating or otherwise violating our owned or licensed intellectual property rights;

●

it is possible that our pending licensed patent applications or those that we may own in the future will not lead to issued patents;

●

issued patents that we hold rights to may be held invalid or unenforceable, including as a result of legal challenges by our competitors;

●

our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets;

●

we may not develop additional proprietary technologies that are patentable;

●

the patents of others may harm our business; and

●

we may choose not to file a patent for certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.

●

the ability of our board of directors to issue one or more series of preferred stock;

●

stockholder action by written consent only until the first time when Dr. Rothberg ceases to beneficially own a majority of the voting power of our capital stock;

●

certain limitations on convening special stockholder meetings;

●

advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;

●

amendment of certain provisions of the organizational documents only by the affirmative vote of (i) a majority of the voting power of our capital stock so long as Dr. Rothberg beneficially owns shares representing a majority of the voting power of our capital stock and (ii) at least two-thirds of the voting power of the capital stock from and after the time that Dr. Rothberg ceases to beneficially own shares representing a majority of our voting power; and

●

a dual-class common stock structure with 20 votes per share of our Class B common stock, the result of which is that Dr. Rothberg has the ability to control the outcome of matters requiring stockholder approval, even though Dr. Rothberg owns less than a majority of the outstanding shares of our capital stock.

ITEM 1B.

UNRESOLVED STAFF COMMENTS

ITEM 2.

PROPERTIES

ITEM 3.

LEGAL PROCEEDINGS

ITEM 4.

MINE SAFETY DISCLOSURES

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 6.

[RESERVED]

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

		Years Ended December 31,
(in thousands, except for % changes)		2022				2021				% Change
Operating expenses:
Research and development		$	72,062			$	46,575				54.7	%
Selling, general and administrative			42,296				50,333				(16.0	)%
Goodwill impairment			9,483				-			nm
Total operating expenses			123,841				96,908				27.8	%
Loss from operations			(123,841	)			(96,908	)			27.8	%
Interest expense			-				(5	)			(100.0	)%
Dividend income			5,301				2,549				108.0	%
Change in fair value of warrant liabilities			6,243				4,379				42.6	%
Other (expense), net			(20,145	)			(5,004	)			302.6	%
Loss before provision for income taxes			(132,442	)			(94,989	)			39.4	%
Provision for income taxes			-				-			nm
Net loss and comprehensive loss		$	(132,442	)		$	(94,989	)			39.4	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Research and development		$	72,062			$	46,575			$	25,487				54.7	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Selling, general and administrative		$	42,296			$	50,333			$	(8,037	)			(16.0	)%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount			%
Goodwill impairment		$	9,483			$	-			$	9,483		nm

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Interest expense		$	-			$	(5	)		$	5				(100.0	%)

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Dividend income		$	5,301			$	2,549			$	2,752				108.0	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Change in fair value of warrant liabilities		$	6,243			$	4,379			$	1,864				42.6	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2022				2021				Amount				%
Other (expense), net		$	(20,145	)		$	(5,004	)		$	(15,141	)			302.6	%

		Years Ended December 31,
(in thousands, except for % changes)		2021				2020				% Change
Operating expenses:
Research and development		$	46,575			$	27,555				69.0	%
Selling, general and administrative			50,333				9,136				450.9	%
Total operating expenses			96,908				36,691				164.1	%
Loss from operations			(96,908	)			(36,691	)			164.1	%
Interest expense			(5	)			(9	)			(44.4	)%
Dividend income			2,549				97			nm
Change in fair value of warrant liabilities			4,379				-			nm
Other (expense), net			(5,004	)			(10	)		nm
Loss before provision for income taxes			(94,989	)			(36,613	)			159.4	%
Provision for income taxes			-				-			nm
Net loss and comprehensive loss		$	(94,989	)		$	(36,613	)			159.4	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount				%
Research and development		$	46,575			$	27,555			$	19,020				69.0	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount				%
Selling, general and administrative		$	50,333			$	9,136			$	41,197				450.9	%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount				%
Interest expense		$	(5	)		$	(9	)		$	4				(44.4	)%

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount			%
Dividend income		$	2,549			$	97			$	2,452		nm

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount			%
Change in fair value of warrant liabilities		$	4,379			$	-			$	4,379		nm

		Years Ended December 31,								Change
(in thousands, except for % changes)		2021				2020				Amount			%
Other (expense), net		$	(5,004	)		$	(10	)		$	(4,994	)	nm

		Years Ended December 31,
(in thousands)		2022				2021				2020
Net loss		$	(132,442	)		$	(94,989	)		$	(36,613	)
Adjustments to reconcile to EBITDA:
Interest expense			-				5				9
Dividend income			(5,301	)			(2,549	)			(97	)
Depreciation and amortization			2,584				1,041				894
EBITDA			(135,159	)			(96,492	)			(35,807	)
Adjustments to reconcile to Adjusted EBITDA:
Goodwill impairment			9,483				-				-
Change in fair value of warrant liabilities			(6,243	)			(4,379	)			-
Other expense, net			20,145				5,004				10
Stock-based compensation			11,206				24,918				1,924
Transaction related costs - business combination			-				6,920				-
Adjusted EBITDA		$	(100,568	)		$	(64,029	)		$	(33,873	)

		Years Ended December 31,
(in thousands)		2022				2021				2020
Net cash (used in) provided by:
Net cash used in operating activities		$	(90,560	)		$	(66,813	)		$	(32,573	)
Net cash provided by (used in) investing activities			137,185				(450,937	)			(461	)
Net cash provided by financing activities			1,909				516,625				37,014
Net increase (decrease) in cash and cash equivalents		$	48,534			$	(1,125	)		$	3,980

●

Risk-free interest rate: The risk-free interest rate for periods within the expected term of the awards is based on the U.S. Treasury yield curve in effect at the time of the grant;

●

Expected dividend yield: We have never declared or paid any cash dividends and do not expect to pay any cash dividends in the foreseeable future;

●

Expected term: For awards, we calculate the expected term using the “simplified” method, which is the simple average of the vesting period and the contractual term; and

●

Expected volatility: We determined expected annual equity volatility to be 70% based on the historical volatility of guideline public companies for the year ended December 31, 2020 and from January to June 10, 2021.  After June 10, 2021, the volatility is calculated by a third-party professional services firm and reviewed by the Company.

Item 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

ITEM 9A.

CONTROLS AND PROCEDURES

ITEM 9B.

OTHER INFORMATION

ITEM 9C.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

ITEM 11.

EXECUTIVE COMPENSATION

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES