10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2022.

OR

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

For the transition period from __________ to __________.

Commission File Number: 001-38298

Zomedica Corp.

(Exact name of registrant as specified in its charter)

Alberta, Canada	N/A
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

100 Phoenix Drive, Suite 125 Ann Arbor, Michigan	48108
(Address of principal executive offices)	(Zip code)

(734) 369-2555

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares, without par value	ZOM	NYSE American

As of August 15, 2022, 979,949,668 shares of the registrant’s common shares, without par value, were issued and outstanding.

ZOMEDICA CORP.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED

JUNE 30, 2022

TABLE OF CONTENTS

		Page
PART I
FINANCIAL INFORMATION
Item 1.	Condensed Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 4.	Controls and Procedures	31
PART II
OTHER INFORMATION
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 6.	Exhibits	33

2

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

Zomedica Corp.

Consolidated balance sheets

(Unaudited) (United States dollars in thousands)

	As of
	June 30,		December 31,
	2022		2021
Assets
Current assets
Cash and cash equivalents	$	186,763	$	194,952
Inventory, net		4,819		2,848
Prepaid expenses and deposits		2,315		1,842
Trade receivables, net		414		315
Other receivables		315		450
Total current assets		194,626		200,407
Prepaid expenses and deposits		331		394
Property and equipment, net		1,710		1,130
Assets in process		523		420
Right-of-use asset		1,638		1,320
Goodwill		43,288		43,288
Intangible assets, net		32,097		33,176
Debt security (at fair value)		1,000		—
Other assets		265		265
Total assets	$	275,478	$	280,400
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities	$	3,491	$	3,225
Accrued income taxes		41		240
Current portion of lease obligations		523		415
Customer contract liabilities		153		198
Other current liabilities		266		262
Total current liabilities		4,474		4,340
Lease obligations		1,184		964
Deferred tax liabilities		3,048		3,709
Customer contract liabilities		161		140
Other liabilities		391		361
Total liabilities	$	9,258	$	9,514
Commitments and contingencies (Note 14)
Shareholders’ equity
Unlimited common shares, no par value; 979,899,668 issued and outstanding at June 30, 2022 and December 31, 2021	$	380,962	$	380,962
Additional paid-in capital		13,846		9,313
Accumulated deficit		(128,601)		(119,391)
Accumulated comprehensive income		13		2
Total shareholders' equity		266,220		270,886
Total liabilities and shareholders’ equity	$	275,478	$	280,400

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

Zomedica Corp.

Consolidated statements of loss and comprehensive loss

(Unaudited) (United States dollars in thousands, except per share data)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Net revenue	$	4,246	$	16	$	7,997	$	30
Cost of revenue		1,210		36		2,199		42
Gross profit (loss)		3,036		(20)		5,798		(12)
Expenses
Research and development		319		271		670		684
Selling, general and administrative		8,597		5,038		15,321		8,505
Loss from operations		(5,880)		(5,329)		(10,193)		(9,201)
Interest income		(277)		(112)		(384)		(167)
Loss on disposal of assets		1		—		1		243
Other (income) loss		(1)		(505)		4		(529)
Foreign exchange loss (gain)		52		(1)		56		—
Loss before income taxes		(5,655)		(4,711)		(9,870)		(8,748)
Income tax benefit		(382)		—		(660)		—
Net loss		(5,273)		(4,711)		(9,210)		(8,748)
Change in foreign currency translation		(40)		—		11		—
Net loss and comprehensive loss	$	(5,313)	$	(4,711)	$	(9,199)	$	(8,748)
Weighted average number of common shares - basic and diluted		979,899,668		973,656,518		979,899,668		932,959,287
Loss per share - basic and diluted (Note 16)	$	(0.005)	$	(0.005)	$	(0.009)	$	(0.044)

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

Zomedica Corp.

Consolidated statements of shareholders’ equity

(Unaudited) (United States dollars in thousands)

	For the six months ended June 30, 2022
				Common		Additional				Accumulated
	Common stock			stock		paid-in		Accumulated		comprehensive
	Shares	Amount		subscribed		capital		deficit		income		Total
Balance at December 31, 2021	979,899,668	$	380,962	$	-	$	9,313	$	(119,391)	$	2	$	270,886
Stock-based compensation	-		-		-		4,533		-		-		4,533
Net loss	-		-		-		-		(9,210)		-		(9,210)
Other comprehensive income	-		-		-		-		-		11		11
Balance at June 30, 2022	979,899,668	$	380,962	$	-	$	13,846	$	(128,601)	$	13	$	266,220

	For the three months ended June 30, 2022
				Common		Additional				Accumulated
	Common stock			stock		paid-in		Accumulated		comprehensive
	Shares	Amount		subscribed		capital		deficit		income		Total
Balance at March 31, 2022	979,899,668	$	380,962	$	—	$	11,354	$	(123,328)	$	53	$	269,041
Stock-based compensation	—		—		—		2,492		—		—		2,492
Net loss	—		—		—		—		(5,273)		—		(5,273)
Other comprehensive income	—		—		—		—		—		(40)		(40)
Balance at June 30, 2022	979,899,668	$	380,962	$	—	$	13,846	$	(128,601)	$	13	$	266,220

	For the six months ended June 30, 2021
				Common		Additional				Accumulated
	Common stock			stock		paid-in		Accumulated		comprehensive
	Shares	Amount		subscribed		capital		deficit		income		Total
Balance at December 31, 2020	642,036,228	$	104,784	$	460	$	14,792	$	(68,969)	$	-	$	51,067
Stock issuance for financing	105,013,158		199,525		-		-		-		-		199,525
Stock issuance costs	—		(14,281)		-		-		-		-		(14,281)
Stock-based compensation	—		-		-		3,065		-		-		3,065
Stock issuance from warrant exercises	200,951,905		44,082		(460)		(11,511)		-		-		32,111
Stock issuance from exercise of stock options	5,230,601		2,112		-		(744)		-		-		1,368
Stock redemption	24,719,101		44,000		-		-		(32,039)		-		11,961
Net loss	—		-		-		-		(8,748)		-		(8,748)
Balance at June 30, 2021	977,950,993	$	380,222	$	-	$	5,602	$	(109,756)	$	-	$	276,068

	For the three months ended June 30, 2021
				Common		Additional				Accumulated
	Common stock			stock		paid-in		Accumulated		comprehensive
	Shares	Amount		subscribed		capital		deficit		income		Total
Balance at March 31, 2021	972,092,308	$	377,971	$	—	$	4,602	$	(105,045)	$	—	$	277,528
Stock issuance costs	—		0		—		—		—		—		0
Stock-based compensation	—		—		—		1,782		—		—		1,782
Stock issuance from warrant exercises	628,084		139		—		(38)		—		—		101
Stock issuance from exercise of stock options	5,230,601		2,112		—		(744)		—		—		1,368
Net loss	—		—		—		—		(4,711)		—		(4,711)
Balance at June 30, 2021	977,950,993	$	380,222	$	-	$	5,602	$	(109,756)	$	-	$	276,068

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

Zomedica Corp.

Condensed consolidated statements of cash flows

(Unaudited) (United States dollars in thousands)

	For the Six Months Ended June 30,
	2022		2021
Cash flows from operating activities:
Net loss	$	(9,210)	$	(8,748)
Adjustments for
Depreciation		161		115
Amortization - intangible assets		1,495		89
Loss on disposal of property and equipment		1		243
Loss on other assets		—		5
(Gain) loss on right-of-use assets		—		(533)
Stock-based compensation		4,533		3,065
Non cash portion of rent expense		9		35
Change in non-cash operating working capital
Purchased inventory		(2,572)		(794)
Prepaid expenses and deposits		(410)		437
Trade receivables		(96)		(4)
Other receivables		131		(133)
Accounts payable and accrued liabilities		292		1,847
Accrued income tax		(199)		—
Deferred tax liabilities		(661)		—
Other current liabilities		4		—
Customer contract liabilities		(25)		—
Other liabilities		30		—
Net cash used in operating activities		(6,517)		(4,376)
Cash flows from investing activities:
Investment in debt security (at fair value)		(1,000)		—
Investment in property and equipment		(151)		(43)
Investment in intangibles		—		(99)
Investment in assets in process		(492)		—
Net cash used in investing activities		(1,643)		(142)
Cash flows from financing activities:
Cash proceeds from issuance of common shares and warrants		—		199,525
Cash received from warrant exercises		—		32,112
Cash paid for shares and warrant issuance costs		—		(14,269)
Cash received from stock option exercises		—		1,368
Net cash provided by financing activities		—		218,736
(Decrease) increase in cash and cash equivalents		(8,160)		214,218
Effect of exchange rate changes on cash		(29)		—
Cash and cash equivalents, beginning of year		194,952		61,992
Cash and cash equivalents, end of year	$	186,763	$	276,210
Noncash investing and financing activities
Transfer of inventory into property and equipment	$	557	$	—
Supplemental cash flow information:
Interest received	$	(384)	$	(112)

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

1. Nature of operations

The Company is a veterinary health company creating point-of-care diagnostics and therapeutics products for dogs and cats, that focuses on the needs of the veterinarians themselves. The Company consists of the parent company, Zomedica Corp, its wholly-owned U.S subsidiary, Zomedica Inc., and Pulse Veterinary Technologies LLC, along with its international subsidiaries.

The impact of the novel strain of coronavirus (“COVID-19”)

There remains a significant amount of stress and uncertainty across national and global economies due to the pandemic of coronavirus disease 2019 (“COVID-19”) caused by severe acute respiratory syndrome coronavirus 2 (the “COVID-19 pandemic”). The continued presence of COVID-19 has resulted in changes in the macro-economic environment including disruptions in supply chain, labor disruptions, an inability to manufacture, an inability to sell to customers, declines in customer demand, and an impaired ability to access credit and capital markets, among other things.

The COVID-19 pandemic materially and adversely affected the development and commercialization of our TRUFORMA® platform and the initial five assays. In response to the pandemic, our development partner had reduced the number of employees working in its facilities for a period of time which has delayed the completion of the verification of the five initial TRUFORMA® assays and the manufacturing of commercial quantities of the TRUFORMA® platform and the related assays. Veterinary hospitals and clinics that had agreed to participate in the validation of our initial TRUFORMA® assays either shut down for a period of time or limited their operations to those involving only life-threatening conditions, which we have mitigated to a certain extent with our recent ability to successfully complete remote installations. Potential customers have at times restricted access to their facilities which has affected and may continue to affect our ability to perform on-site demonstrations and other marketing activities. The extent to which the COVID-19 pandemic may impact our business will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the duration of the outbreak, the spread and severity of COVID-19, and the effectiveness of governmental actions in response to the pandemic.

The emergence of new variants has not caused significant modification to business operations.  We continue to install remotely, if potential customers restrict access to their facilities.  We intend to continue development of new assays, both for equine indications of our current and planned assays, and for various additional disease states affecting canine, feline, and equine patients in the future.  

2. Basis of preparation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for the presentation of interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited financial statements do not include all the information and footnotes necessary for a comprehensive presentation of the financial position, results of operations and cash flows for the periods presented. In the opinion of management, the unaudited financial statements include all the normal recurring adjustments that are necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2022. These unaudited financial statements should be read in combination with the other Notes in this section; “Management’s Discussion and Analysis of Financial Condition and Results of Operations” appearing in Item 2; and the Consolidated Financial Statements, including the Notes to the Consolidated Financial Statements, included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. The Consolidated Balance Sheet as of December 31, 2021 was derived from audited financial statements.

3. Significant accounting policies

Estimates and assumptions

In preparing these financial statements, management was required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates and assumptions are based on our historical experience, the terms of existing contracts, our evaluation of trends in the industry, information provided by our customers and suppliers and information available from other outside sources, as appropriate. These estimates and assumptions are subject to an inherent degree of uncertainty. We are not presently aware of any events or circumstances that would require us to update such estimates and assumptions or revise the carrying value of our assets or liabilities. Our estimates may change, however, as new events occur, and additional information is

7

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

obtained. As a result, actual results may differ significantly from our estimates, and any such differences may be material to our financial statements.

Inventories

Inventories are stated at the lower of cost or net realizable value. The Company utilizes the specific identification and First in, First out (“FIFO”) methods to track inventory costs. The Company records reserves, when necessary, to reduce the carrying value of inventory to its net realizable value. Management considers forecast demand in relation to the inventory on hand, competitiveness of product offerings, market conditions and product life cycles when determining excess and obsolescence and net realizable value adjustments. At the point of loss recognition, a new, lower-cost basis for that inventory is established, and any subsequent improvements in facts and circumstances do not result in the restoration or increase in that newly established cost basis.

Intangible assets

Expenditures related to the planning and operation of the Company’s website are expensed as incurred. Expenditures related to the website application and infrastructure development are capitalized and amortized over the website’s estimated useful life.

Costs related to acquired trademarks, tradename, customer relationships and developed technology have been capitalized and amortized over the estimated useful life.

Revenue recognition and liabilities due to customers

The Company enters into agreements which may contain multiple promises where customers purchase products, services or a combination thereof. Determining whether products and services are considered distinct performance obligations that should be accounted for separately requires judgment. We determine the transaction price for a contract based on the total consideration we expect to receive in exchange for the transferred goods or services.

The Company allocates revenue to each performance obligation in proportion to the relative standalone selling prices and recognizes revenue when control of the related goods or services is transferred for each obligation. We utilize the observable standalone selling price when available, which represents the price charged for the performance obligation when sold separately.

The Company's contracts with customers are generally comprised of purchase orders for the sale of the point of care instrument, consumable products, and extended warranties, or some variation thereof. The instrument and consumables each represent a single performance obligation when sold separately, that is satisfied at a point in time upon transfer of control of the product to the customer which is typically upon receipt of the goods by the customer. The extended warranties are also a separate performance obligation, whereby revenue is recognized over time.

The nature of the Company’s business gives rise to variable consideration, including discounts and applicator (“trode”) returns. Credits are issued for unused shocks on returned trodes, which can be used toward the purchase of replacement trodes. Discounts and the estimated unused shock credits decrease the transaction price, which reduces revenue. Variable consideration related to unused shock credits is estimated using the expected value method, which estimates the amount that is expected to be earned. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Estimates of variable consideration are estimated based upon historical experience and known trends. These estimated credits are nonrefundable and may only be used towards the purchase of future trode refurbishments. This practice encourages refurbishment purchase prior to complete utilization of the previous trode, so the customer will always have a trode at hand with ample capacity to perform treatments.

At times the Company receives consideration prior to when the performance obligation is completed, giving rise to a contract liability.  

Sales are recorded net of sales tax. Sales tax is charged on sales to end users and remitted to the appropriate state authority.

Accounts receivable are recorded at net realizable value and have payment terms of 30 days.  The Company recorded an allowance for doubtful accounts of $36 and $34, as of June 30, 2022 and December 31, 2021, respectively, which is recorded net in trade receivables.

8

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

The diagnostic segment reported $92 in revenue from consumables for the three months ended June 30, 2022, compared to $16 for the three months ended June 30, 2021, an increase of $76 or 475%. The therapeutics segment reported $4,154 in total revenue for the three months ended June 30, 2022, compared to $0 for the three months ended June 30, 2021. Therapeutics revenue for the three months ended June 30, 2002 was comprised of $2,308 in revenue from trodes, $1,543 in revenue from instruments, and $303 in other revenues which includes warranty and repair work.

The diagnostic segment reported $148 in revenue from consumables for the six months ended June 30, 2022, compared to $30 for the six months ended June 30, 2021, an increase of $118 or 393%. The therapeutics segment reported $7,849 in total revenue for the six months ended June 30, 2022, compared to $0 for the six months ended June 30, 2021. Therapeutics revenue for the six months ended June 30, 2002 was comprised of $4,226 in revenue from trodes, $3,102 in revenue from instruments, and $520 in other revenues which includes warranty and repair work.

Cost of revenue

Cost of revenue consists of materials, and shipping costs incurred internally to produce and receive the products. Shipping and handling costs incurred by the Company are included in cost of revenue.

Comparative figures  

Assets in process are separately stated in the current period balance sheet for $523.  The consolidated balance sheets for the year ended December 31, 2021 have been adjusted for $420 of assets in process that were included in intangible assets and property and equipment.  This amount has been reclassified to a separate line in the balance sheet to conform to the current year presentation. The change in presentation had no effect on the reported results of operations. These changes in classification do not affect previously reported cash flows from operating activities in the consolidated statements of cash flows.

4. Business Combinations

Acquisition of PulseVet

On October 1, 2021, Zomedica Inc., a wholly-owned subsidiary of Zomedica Corp. (the “Company”), entered into a Stock Purchase Agreement with Branford PVT Mid-Hold, LLC pursuant to which Zomedica Inc. acquired 100% of the capital stock of Branford PVT Acquiror, Inc., a Delaware corporation (“BPA”). BPA is a holding company whose direct and indirect wholly-owned subsidiaries include Pulse Veterinary Technologies, LLC (“PulseVet”), which, together with its consolidated subsidiaries, is a leading provider of non-invasive shock wave therapy treatment devices to the veterinary industry (the “Acquisition”). The purchase price for the Acquisition was $71,929 in cash.

As a result of total consideration exceeding the preliminary fair value of the net assets acquired, goodwill in the amount of $43,288 was recorded in connection with this acquisition, none of which will be deductible for U.S tax purposes. The goodwill largely results from our ability to market and sell the PulseVet Technology through our established customer base.

9

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

The following table summarizes the preliminary acquisition date fair values of the assets acquired and liabilities assumed and subsequent initial period adjustments:

	Initial		Measurement
	allocation of		period		Updated
	consideration		adjustments		allocation
Cash and cash equivalents	$	526	$	3	$	529
Inventory		840		31		871
Prepaid expenses and deposits		365		—		365
Trade receivables		269		—		269
Other receivables		—		150		150
Property and equipment		125		—		125
Intangible Assets (estimated useful life)		—		—		—
Developed technology (15 years)		8,650		—		8,650
Trade name (19 years)		2,350		—		2,350
Customer relationships (11 years)		22,650		—		22,650
Other Assets		69		265		334
Total assets acquired		35,844		449		36,293
Accounts payable and accrued liabilities		1,112		(543)		569
Income tax payable		44		—		44
Deferred revenue		61		—		61
Liability for contracts with customers		332		—		332
Deferred tax liabilities		7,138		(900)		6,238
Other non current liabilities		143		265		408
Total liabilities assumed		8,830		(1,178)		7,652
Net assets acquired, excluding goodwill		27,014		1,627		28,641
Goodwill		44,915		(1,627)		43,288
Net assets acquired	$	71,929	$	—	$	71,929

During the period subsequent to the acquisition of PulseVet, we made certain preliminary measurement period adjustments to the acquired assets and liabilities assumed. The determination of the final purchase price allocation to specific assets and liabilities assumed is incomplete. The purchase price allocation may change in future periods as the fair value estimates of the deferred tax assets and liabilities are adjusted.  

5. Inventory

Inventory details are as follows:

	June 30, 2022						December 31, 2021
	Diagnostics		Therapeutics		Consolidated		Diagnostics		Therapeutics		Consolidated
Raw Materials	$	—	$	1,300	$	1,300	$	—	$	890	$	890
Finished Goods		—		323		323		—		140		140
Purchased Inventory		3,234		—		3,234		1,848		—		1,848
Total		3,234		1,623		4,857		1,848		1,030		2,878
Reserves		(16)		(22)		(38)		(9)		(21)		(30)
Inventory, Net	$	3,218	$	1,601	$	4,819	$	1,839	$	1,009	$	2,848

6. Prepaid expenses, deposits and deferred financing costs

10

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

	June 30,		December 31,
	2022		2021
Deposits	$	1,966	$	1,340
Prepaid marketing		144		83
Prepaid insurance		272		599
Other		264		214
Total	$	2,646	$	2,236

7. Property and equipment

	June 30,		December 31,
	2022		2021
Machinery and office equipment	$	2,098	$	1,392
Furniture and equipment		106		110
Laboratory equipment		230		225
Leasehold improvements		287		287
		2,721		2,014
Accumulated depreciation and amortization		1,011		884
Net property and equipment	$	1,710	$	1,130

Depreciation expense for the three months ended June 30, 2022 and June 30, 2021 was $71 and $55, respectively and for the six months ended June 30, 2022 and June 30, 2021 was $161 and $115, respectively.

11

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

8. Intangible assets

	June 30,		December 31,
	2022		2021
Computer software	$	28	$	28
Trademarks		16		16
Website		962		546
Tradename		2,350		2,350
Customer relationships		22,650		22,650
Technology		8,650		8,650
		34,656		34,240
Accumulated amortization		2,559		1,064
Net intangibles	$	32,097	$	33,176

The estimated future amortization of intangible assets is as follows:

2022 Remainder	$	1,542
2023		2,912
2024		2,906
2025		2,809
2026 and beyond		21,928
Total	$	32,097

Amortization expense for the three months ended June 30, 2022 and June 30, 2021 was $759 and $45, respectively and for the six months ended June 30, 2022 and 2021 was $1,495 and $89, respectively.

9. Debt security (at fair value)

On May 16, 2022, Zomedica Inc. purchased a $1.0 million convertible note from Structured Monitoring Products, Inc. (“SMP”), and in connection with the note has acquired the option to act as a sales agent for SMP's platform. The note, which provides for 8% interest and is due to be repaid in May of 2024, is convertible into equity securities of the Company upon the occurrence of certain events. Under the terms of the agreement, Zomedica Inc. will also have the option to acquire SMP’s VetGuardian product line for use in animal health. Exercise of both options is subject to certain conditions, including negotiation and execution of mutually acceptable agreements.

As of June 30, 2022, the fair value of our debt security investment was as follows:

	June 30, 2022
Debt security (at fair value)	$	1,000,000
Interest receivable		9,863
		1,009,863
Allowance for doubtful accounts		-
Debt security (at fair value), net	$	1,009,863

The investment in the convertible note was recorded at its fair value of $1,000,000 as of June 30, 2022 (with an amortized cost basis of $1,000,000). There were no unrealized gains or losses recorded and no other than temporary impairments recognized as of June 30, 2022.

12

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

10. Leases

On February 1, 2021 the Company downsized its office space and modified its existing lease with Wickfield Phoenix LLC. The new lease period was for 48 months, commencing on February 1, 2021 and ending on January 31, 2025 with a monthly rent payment of $12 for the first two months and escalating to $31 over the lease period. The carrying value of the right of use asset was $1,258 upon modification using the Company's incremental borrowing rate of 3.95%. During the period ending March 31, 2021 the Company recorded a gain on right-of-use asset of $24 in the consolidated statements of comprehensive loss.

On September 15, 2021, the Company entered into an additional lease with Wickfield Phoenix LLC for warehousing space. The new lease period is for 41 months, commencing on September 15, 2021, and ending on January 31, 2025, with a monthly rent payment of $5 for the first month and escalating to $10 over the lease period. The Company recorded a right-of-use asset and corresponding lease liability for $366 using the Company's incremental borrowing rate of 3.95%.

On April 1, 2022, the Company entered into an agreement with ULF Northfield Business Center LLC to lease 12,400 square feet of office and warehouse space.  The lease period is for 61 months beginning on April 1, 2022, with a monthly rent payment of $9 for the first twelve months and escalating to $11 per month over the lease period. The Company recorded a right-of-use asset and corresponding lease liability for $546 using the Company's incremental borrowing rate of 3.95%.

During the three and six months ended June 30, 2022, the Company recognized $179 and $331 in rent expense inclusive of common area maintenance (CAM) charges, insurance, and tax with $18 and $34 recorded in research and development expenses and $161 and $297 recorded in general and administrative expense in the consolidated statements of comprehensive loss.

During the three and six months ended June 30, 2021, the Company recognized $85 and $176 in rent expense inclusive of common area maintenance (CAM) charges, insurance, and tax with $17 and $38 recorded in research and development expenses and $68 and $138 recorded in general and administrative expense in the consolidated statements of comprehensive loss.

	June 30,		December 31,
	2022		2021
Right-of-use asset
Cost
Aggregate lease commitments	$	2,385	$	1,779
Less: impact of present value		(215)		(155)
Balance	$	2,170	$	1,624
Reduction in right-of-use asset
Straight line amortization		605		346
Interest		(73)		(42)
Balance	$	532	$	304
Net book value as at:
Balance	$	1,638	$	1,320
Lease liabilities
Additions	$	2,193	$	1,647
Payments		(559)		(310)
Interest		73		42
Total lease liabilities	$	1,707	$	1,379
Current portion of lease liabilities		523		415
Long term portion of lease liabilities		1,184		964
Total lease liabilities	$	1,707	$	1,379

13

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

Total remaining undiscounted lease liabilities related to the above lease are as follows:

2022 Remainder	$	287
2023		590
2024		609
2025		165
2026		129
2027		44
Total	$	1,824

11. Stock-based compensation

During the three and six months ended June 30, 2022, the Company issued 6,575,000 and 21,000,000 stock options to purchase an aggregate of 6,575,000 and 21,000,000 common shares. The options vest over a period of four years and have an expiration period of ten years.  During the three and six months ended June 30, 2021, the Company issued 7,800,000 and 9,200,000 stock options to purchase an aggregate of 7,800,000 and 9,200,000 common shares, respectively. The options vest over a period of four years and have an expiration period of 10 years.

The continuity of stock options are as follows:

	Number of	Weighted Avg
	Options	Exercise Price
Balance at December 31, 2021	50,717,724	$	0.45
Stock options granted	21,000,000		0.32
Stock options exercised	—		—
Stock options forfeited	1,250,000		0.67
Vested stock options expired	8,960,000		0.22
Balance at June 30, 2022	61,507,724	$	0.43
Vested at June 30, 2022	15,596,349	$	0.36

14

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

As of June 30, 2022, details of the issued and outstanding stock options were as follows:

				Number of	Weighted avg
		Number of options	Number of	unvested	remaining life
		issued	vested options	options	outstanding
Grant date	Exercise price	and outstanding	outstanding	outstanding	(years)
March 14, 2020	0.19	1,283,557	949,682	333,875	2.71
July 9, 2020	0.18	175,000	87,500	87,500	3.03
August 25, 2020	0.13	20,000	—	20,000	3.16
October 1, 2020	0.11	266,667	116,667	150,000	3.26
October 20, 2020	0.09	20,000	10,000	10,000	3.31
December 31, 2020	0.23	16,442,500	8,807,500	7,635,000	3.51
February 26, 2021	1.87	500,000	300,000	200,000	3.66
March 1, 2021	2.06	200,000	100,000	100,000	3.67
March 8, 2021	1.88	200,000	100,000	100,000	3.69
March 15, 2021	2.49	200,000	100,000	100,000	3.71
May 12, 2021	0.78	3,450,000	900,000	2,550,000	3.87
May 14, 2021	0.75	3,200,000	850,000	2,350,000	3.87
August 11, 2021	0.57	1,100,000	175,000	925,000	4.12
August 18, 2021	0.50	200,000	—	200,000	4.14
August 23, 2021	0.50	100,000	—	100,000	4.15
September 13, 2021	0.57	800,000	—	800,000	4.21
October 1, 2021	0.58	12,650,000	—	12,650,000	4.26
January 3, 2022	0.36	100,000	—	100,000	4.52
January 4, 2022	0.35	200,000	—	200,000	4.52
January 14, 2022	0.35	200,000	—	200,000	4.55
January 16, 2022	0.35	325,000	—	325,000	4.55
January 18, 2022	0.35	100,000	—	100,000	4.56
February 14, 2022	0.30	400,000	—	400,000	4.63
February 21, 2022	0.37	200,000	—	200,000	4.65
February 25, 2022	0.35	12,400,000	—	12,400,000	4.66
March 30, 2022	0.35	200,000	—	200,000	4.75
April 1, 2022	0.34	200,000	—	200,000	4.76
April 6, 2022	0.32	100,000	—	100,000	4.77
April 7, 2022	0.31	200,000	—	200,000	4.77
April 11, 2022	0.31	75,000	—	75,000	4.78
May 2, 2022	0.25	300,000	—	300,000	4.84
May 9, 2022	0.21	700,000	—	700,000	4.86
May 11, 2022	0.20	400,000	—	400,000	4.87
May 16, 2022	0.23	100,000	—	100,000	4.88
May 31, 2022	0.24	500,000	—	500,000	4.92
June 1, 2022	0.25	500,000	—	500,000	4.92
June 6, 2022	0.26	200,000	—	200,000	4.94
June 13, 2022	0.24	200,000	—	200,000	4.96
June 17, 2022	0.24	3,100,000	3,100,000	—	4.97
Balance at June 30, 2022		61,507,724	15,596,349	45,911,375

The Company calculates volatility of stock-based compensation using the historical price of the Company’s stock. An increase/decrease in the volatility would have resulted in an increase/decrease in the fair value of the options.

15

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

The fair value of options granted during the six months ended June 30, 2022 and the twelve months ended December 31, 2021 was estimated using the Black-Scholes option pricing model to determine the fair value of options granted using the following assumptions:

	February 26,			March 1,			March 8,
	2021			2021			2021
Volatility		117	%		117	%		117	%
Risk-free interest rate		0.95	%		0.92	%		1.07	%
Expected life (in years)		10			10			10
Dividend yield		0	%		0	%		0	%
Common share price	$	1.87		$	2.06		$	1.88
Strike price	$	1.87		$	2.06		$	1.88
Forfeiture rate		0	%		0	%		0	%

	May 12,			August 11,			August 23,
	2021			2021			2021
Volatility		118	%		116	%		116	%
Risk-free interest rate		1.11	%		0.96	%		0.92	%
Expected life (in years)		6.21-6.22			6.18-6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.78		$	0.56		$	0.50
Strike price	$	0.78		$	0.57		$	0.50
Forfeiture rate		0	%		0	%		0	%

	September 27,			October 1,
	2021			2021
Volatility		116	%		116	%
Risk-free interest rate		1.14	%		1.10	%
Expected life (in years)		6.25			6.25
Dividend yield		0	%		0	%
Common share price	$	0.54		$	0.57
Strike price	$	0.54		$	0.58
Forfeiture rate		0	%		0	%

16

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

	January 3,			January 4,			January 14,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		1.50	%		1.47	%		1.64	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.36		$	0.35		$	0.35
Strike price	$	0.36		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%
	January 16,			January 18,			February 14,
	2022			2022			2022
Volatility		114	%		114	%		113	%
Risk-free interest rate		1.73	%		1.74	%		1.94	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.35		$	0.35		$	0.29
Strike price	$	0.35		$	0.35		$	0.30
Forfeiture rate		0	%		0	%		0	%
	February 21,			February 25,			March 30,
	2022			2022			2022
Volatility		113	%		113	%		114	%
Risk-free interest rate		1.89	%		1.91	%		2.43	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.37		$	0.35		$	0.35
Strike price	$	0.37		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%

	April 1,			April 6,			April 7,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		2.53	%		2.70	%		2.72	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.33		$	0.32		$	0.31
Strike price	$	0.34		$	0.32		$	0.31
Forfeiture rate		0	%		0	%		0	%
	April 11,			May 2,			May 9,
	2022			2022			2022
Volatility		114	%		113	%		113	%
Risk-free interest rate		2.82	%		3.03	%		3.00	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.30		$	0.25		$	0.21
Strike price	$	0.31		$	0.25		$	0.21
Forfeiture rate		0	%		0	%		0	%
	May 11,			May 16,			May 31,
	2022			2022			2022
Volatility		113	%		113	%		113	%
Risk-free interest rate		2.92	%		2.86	%		2.84	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.20		$	0.22		$	0.23
Strike price	$	0.20		$	0.23		$	0.24
Forfeiture rate		0	%		0	%		0	%

17

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

	June 1,			June 6,			June 13,
	2022			2022			2022
Volatility		113	%		113	%		112	%
Risk-free interest rate		2.96	%		3.05	%		3.55	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.25		$	0.26		$	0.24
Strike price	$	0.25		$	0.26		$	0.24
Forfeiture rate		0	%		0	%		0	%
	June 17,			June 17,			June 17,
	2022			2022			2022
Volatility		112	%		112	%		112	%
Risk-free interest rate		3.02	%		3.02	%		3.35	%
Expected life (in years)		1.37			1.64			4.27
Dividend yield		0	%		0	%		0	%
Common share price	$	0.24		$	0.24		$	0.24
Strike price	$	0.24		$	0.24		$	0.24
Forfeiture rate		0	%		0	%		0	%

The Company recorded $2,492 and $4,533 of stock-based compensation for the three and six months ended June 30, 2022, respectively. For the three and six months ended June 30, 2021, the Company recorded $1,782 and $3,065, respectively.

12. Warrants

The Company values warrants issued in equity placements using the Black Scholes model to allocate the fair value of the proceeds from equity financings using a relative fair value approach. Like other stock-based compensation, management uses judgment to determine the inputs to the Black-Scholes option pricing model including the expected life, and underlying share price volatility. Changes in these assumptions will impact the calculation of fair value and the value attributed to the warrants.  The Company calculates volatility of warrants based on the historical price of the Company’s stock. An increase/decrease in the volatility would have resulted in an increase/decrease in the fair value of the options.

In connection with the February 14, 2020 registered direct offering, the Company issued 20,833,334 five and one half-year Series A warrants to purchase 20,833,334 shares of common stock at an exercise price of $0.20. The Company also issued 1,041,667 warrants to purchase 1,041,667 shares of common stock at an exercise price of $0.15 per share to the placement agents.

In connection with the April 9, 2020 CMPO, the Company issued 16,666,667 five-year Series B Warrants to purchase 16,666,667 common shares at an exercise price of $0.15. The Company also issued 1,666,667 Placement Agent Warrants to purchase 1,666,667 common shares at an exercise price of $0.15 per share.

In connection with the May 29, 2020 public offering, the Company issued 133,333,333 two-year Series C Warrants to purchase 133,333,333 common shares at an exercise price of $0.15. The Company also issued 12,170,000 Series C Pre-Funded Warrants to purchase common shares at an exercise price of $0.0001 on a cashless exercise basis. As of December 31, 2020, all of the Series C Pre-Funded warrants had been exercised.

In connection with the July 7, 2020 public offering, the Company issued 187,500,000 two-year Series D Warrants to purchase 187,500,000 common shares at an exercise price of $0.16. The Company also issued 25,000,000 Series D Pre-Funded Warrants to purchase common shares at an exercise price of $0.0001 on a cashless exercise basis. As of December 31, 2020, all of the Series D Pre-Funded Warrants had been exercised.

18

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

As at June 30, 2022, details of the outstanding warrants were as follows:

			Weighted
			Average
	Exercise	Warrants	Remaining
Original Issue date	Price	Outstanding	Life
February 14, 2020	0.15	197,917	2.62
April 9, 2020	0.15	363,501	2.78
May 29, 2020	0.15	-	-
July 7, 2020	0.16	231,000	0.02
Balance at June 30, 2022		792,418

13. Income taxes

The Company is in an overall net deferred tax liability position as of June 30, 2022.  Management has assessed that the future taxable income resulting from the deferred tax liability position will result in utilization of the Company’s US federal and state net operating loss carryforwards in future tax periods.  The Company is in a net deferred tax asset position in Canada and a full valuation allowance against the Canada deferred tax assets remains necessary as a result of the historical losses and the uncertainty of realizing any future tax benefits related to the Canadian deferred tax assets.

14. Commitments and contingencies

On May 10, 2018, the Company entered into a Development, Commercialization and Exclusive Distribution Agreement. As part of the agreement, the Company is required to make the following future milestone payments:

● 1st payment: $3,500 in cash payment upon the achievement of future development milestones

● 2nd payment: $3,500 in equity, determined by dividing the amount due by the volume-weighted average price of the Company’s common stock on the NYSE American exchange over the 10 trading days prior to the achievement of the milestone event.

As of June 30, 2022, none of the future development milestones related to the above agreement have been met. The Company has assessed the probability of meeting the above milestones and has determined that an accrual is not necessary as of June 30, 2022 and December 31, 2021.

From time to time, the Company may be exposed to claims and legal actions in the normal course of business. The Company is not aware of any pending or threatened material litigation claims against the Company.

19

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

15. Segment information

The Company’s operations are comprised of two reportable segments. Although the reportable segments provide similar products, each one is managed separately to better align with the Company’s customers and distribution or development partners.

In addition, all of the Company’s long-lived assets are in the United States of America (“US”).

	Diagnostics		Therapeutics		Consolidated
Net Revenue	$	148	$	7,849	$	7,997
Operating (loss) income		(12,481)		2,288		(10,193)
Interest income		384		-		384
(Loss) income before income taxes	$	(12,108)	$	2,238	$	(9,870)
Total assets	$	195,130	$	80,348	$	275,478
Depreciation and amortization		241		1,415		1,656
Capital expenditures	$	643	$	-	$	643

		June 30,		December 31,
		2022		2021
Non-US	$	5,891	$	171,641
US		269,587		108,759
Total assets	$	275,478	$	280,400
Total US property and equipment	$	2,233	$	1,550
Total US right-of-use asset	$	1,638	$	1,320

16. Loss per share

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Numerator
Net loss for the period	$	(5,273)	$	(4,711)	$	(9,210)	$	(8,748)
Charge to retained earnings for preferred share exchange		-		-		-		(32,039)
Loss attributable to common shareholders		(5,273)		(4,711)		(9,210)		(40,787)
Denominator
Weighted average shares - basic		979,899,668		973,656,518		979,899,668		932,959,287
Stock options		—		—		—		—
Warrants		—		—		—		—
Denominator for diluted loss per share		979,899,668		973,656,518		979,899,668		932,959,287
Loss per share - basic and diluted	$	(0.005)	$	(0.005)	$	(0.009)	$	(0.044)

For the above-mentioned periods, the Company had 61,507,724 stock options and 792,418 warrants outstanding which could potentially dilute basic earnings per share in the future but were excluded from the computation of diluted loss per share in the periods presented, as their effect would have been anti-dilutive.

20

Zomedica Corp.

Notes to the condensed consolidated financial statements

(Unaudited) (United Stated dollars in thousands, except for per share data)

17. Related party transaction

On March 1, 2022 we entered into a Consulting Agreement with Johnny Powers, a member of our Board. Pursuant to the Powers Agreement, Dr. Powers provides strategic consulting services to the Company. Dr. Powers is entitled to $10 per month as compensation and reimbursement for authorized expenses.  The Powers Agreement expires November 30, 2022.

18. Subsequent events

On July 1, 2022, Zomedica Inc., the wholly-owned subsidiary of Zomedica Corp., purchased the assets of Revo Squared for a base purchase price of $6,000 in cash, which was subject to adjustments based on the amount of Revo Squared’s working capital at closing. $500 of the purchase price was deposited into a third-party escrow account for a period of 15 months to support Revo Squared’s indemnification obligation under the Asset Purchase Agreement and an additional $5 of the purchase price was deposited into the escrow account for a period of approximately 90 days to support payment of post-closing adjustments to the purchase price, if any. The Company also issued to Revo Squared a ten-year warrant to purchase an aggregate of 10,000,000 of the Company’s common shares at a per share exercise price equal to $0.2201. Zomedica Inc. has agreed to pay Revo Squared aggregate earn-out payments of up to $4,000 based on the achievement of milestones related to future net sales from Revo Squared Products. One-time earn-out payments of $2,000 each will be payable upon net sales from Revo Squared Products exceeding $5,000 and $10,000 during any calendar year ending on or prior to December 31, 2027.

On July 15, 2022, Zomedica Corp. and its wholly-owned subsidiary Zomedica Inc. entered into an Asset Purchase Agreement with Assisi Animal Health LLC, its wholly-owned subsidiary, AAH Holdings LLC, and certain of Assisi’s members pursuant to which Zomedica Inc. agreed to acquire substantially all of the assets of the Sellers. The Sellers are in the business of developing, manufacturing, marketing, distributing and selling animal health products which use targeted Pulsed Electromagnetic Field (PEMF) therapy to decrease pain and inflammation, accelerate healing, and reduce anxiety that include the Assisi Loop®, Assisi Loop Lounge®, Assisi DentaLoop® and Calmer Canine® product lines. The Acquisition was consummated on the Effective Date. At the closing, Zomedica Inc. paid Assisi a purchase price of $18,000 in cash, which was subject to adjustments based on, among other things, the value of Assisi’s inventory and prepaid expenses at the closing of the Acquisition. $1,400 of the purchase price was deposited into a third-party escrow account to support the Selling Parties’ indemnification obligation under the Purchase Agreement, of which $500 and $900 will be distributed to Assisi on the one-year and 18-month anniversary of the Closing Date, respectively, less the amount of prior or pending indemnification claims. An additional $200 of the purchase price was deposited into the escrow account for a period of approximately 90 days to support payment of post-closing adjustments to the purchase price, if any. The Company also issued to Assisi a ten-year warrant to purchase an aggregate of 22,000,000 of the Company’s common shares at a per share exercise price equal to $0.252. The warrants may be exercised on a cash or cashless basis, at the election of the warrant holder.

21

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATION

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and the related notes and the other financial information included elsewhere in this Report. This discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and forward-looking information under applicable Canadian securities legislation (collectively, “forward-looking statements”) that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this Report, and those set forth in our most recent Annual Report on Form 10-K particularly those under “Risk Factors” discussed below and in our most recent Annual Report on Form 10-K.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and pursuant to applicable Canadian securities legislation that are based on management’s beliefs and assumptions and on information currently available to management. Some of the statements under “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Report contain forward-looking statements. In some cases, you can identify forward-looking statements through our use of words such as “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words.

There are a number of important factors that could cause the actual results to differ materially from those expressed in any forward-looking statement made by us. These factors include, but are not limited to:

● our ability to successfully maintain and grow our TRUFORMA® and PulseVet products;

● our ability to maintain our sales team to market and sell TRUFORMA® and PulseVet, any other products we develop or acquire and the related cost and timing thereof;

● our ability to successfully integrate our recent acquisition of PulseVet (as defined below) and the timing and costs to achieve that integration;

● the ability of our contract partners and contractors to appropriately conduct our product development, validation studies, verification studies, and beta testing, and certain other development activities;

● the ability of our contract manufacturing organizations to manufacture and supply our products;

● our ability to develop and commercialize our future products;

● the expected impact of the novel coronavirus pandemic on our operations;

● our ability to develop and commercialize products that can compete effectively;

● the size and growth of the veterinary diagnostics and medical device markets;

● our ability to obtain and maintain intellectual property protection for our planned and future products candidates;

● regulatory developments in the United States;

● the loss of key personnel;

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● the accuracy of our estimates regarding expenses, future revenues, capital requirements and needs for additional financing;

● the impact of the novel coronavirus pandemic on our operations, including the development, manufacturing and selling of our TRUFORMA® platform and related assays and our PulseVet platform;

● our ability to maintain the listing of our common shares on the NYSE American exchange

● our status as a “passive foreign investment company” for U.S. federal income tax purposes

● Adverse macroeconomic conditions, including inflation, slower growth or recession, new or increased tariffs and other barriers to trade, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment and currency fluctuations; and

● Changes in consumer confidence and spending in response to financial market volatility, negative financial news, conditions in the real estate and mortgage markets, declines in income or asset values, changes to fuel and other energy costs, labor and healthcare costs, and other economic factors.

The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with that may cause our actual results to differ from those anticipated in our forward-looking statements. Please see “Risk Factors” in our most recent Annual Report on Form 10-K for additional risks which could adversely impact our business and financial performance.

All forward-looking statements are expressly qualified in their entirety by this cautionary notice. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this Report or the date of the document incorporated by reference into this Report. We have no obligation, and expressly disclaim any obligation, to update, revise or correct any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. We have expressed our expectations, beliefs and projections in good faith, and we believe they have a reasonable basis. However, we cannot assure you that our expectations, beliefs or projections will result or be achieved or accomplished.

All amounts are in thousands of dollars, except earnings per share, unless otherwise stated.

Overview

We are a veterinary health company creating products for companion animals by focusing on the unmet needs of clinical veterinarians. Our mission is to enrich the lives of the animals we love and the people that care for them by providing products and technologies that improve patient care and enhance practice health. Our product portfolio includes innovative diagnostics and therapeutic medical devices that emphasize patient health and enhancing practice economics.

We currently have two discrete platforms - our TRUFORMA® platform, comprising point-of-care diagnostic products for disease states in dogs and cats, and our PulseVet® platform, which provides for treatment of musculoskeletal issues in horses and small animals.

Dogs and cats commonly suffer from adrenal disorders and thyroid disease, including hypothyroidism and hyperthyroidism. We believe that diagnostic tests are vital for identifying these disorders in sick patients as well as for screening apparently healthy patients. In certain cases, multiple assays must be performed to reach a definitive diagnosis of a specific disease or condition. Clinical veterinarians often do not have access to the equipment and assays to perform this testing at the point-of- care. As a result, certain tests must be sent to a reference lab, resulting in delay in diagnosis and treatment, and depriving clinical veterinarians of potential testing revenue.

Through our TRUFORMA® platform, we are focused on the development and commercialization of diagnostic instruments and related assays for use at the point-of-care that provide reference lab accuracy, thereby enabling practitioners to diagnose and treat diseases sooner.

Through our PulseVet platform, we are the world leader in electro-hydraulic shockwave technology for the treatment of a wide variety of conditions in horses and small animals. Our technology is indicated for conditions including osteoarthritis, tendon and ligament healing, bone healing, chronic pain relief and wound healing.

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As a result of an internal strategic view, we have focused our development and commercialization efforts on our TRUFORMA® platform and our PulseVet technology. We believe this narrowed focus will enable us to capitalize on our core strengths and to accelerate the commercialization of these existing platforms.

Reportable Segments

Our reportable segments are:

● Diagnostics, which consists of our parent company and its U.S subsidiary and includes the TRUFORMA® products, and

● Therapeutics, which consists of PulseVet operations and its two international subsidiaries, HMT High Medical Technologies (Japan) Co. Ltd. ("HMT") and NeoPulse, GmbH ("NeoPulse"), and includes the ProPulse products and services.

Revenue

Our revenue consisted of instruments, cartridges, extended warranty services and miscellaneous activities sold in the U.S associated with our TRUFORMA® platform, as well as instruments, trodes and warranty services sold in the U.S and internationally associated with our PulseVet products.

Cost of Revenue

Cost of revenue consisted primarily of the cost of raw materials used in the assembly of PulseVet instruments and trodes, the cost of TRUFORMA® instruments purchased, and consumables and the related warranties purchased. We expense all inventory obsolescence provisions related to normal manufacturing changes as cost of revenue.

Operating Expenses

The majority of our operating expenses have been for the selling, general and administrative activities related to general business activities, capital market activities, stock-based compensation, developing a commercial team and research and development activities related to our product development.

Research and Development Expense

All costs of research and development are expensed in the period in which they are incurred. Research and development costs primarily consist of salaries and related expenses for personnel, fees paid to consultants, outside service providers, professional services, travel costs and materials used in clinical trials and research and development.

Selling, General and Administrative Expense

Selling, general and administrative expense consists primarily of personnel costs, including salaries, related benefits and stock-based compensation for employees, consultants and directors. These expenses also include costs associated with sales and marketing activity, professional fees, and corporate administrative and overhead costs, including rent and other facilities costs, amortization, and depreciation.

Income Taxes

As of December 31, 2021, we had net operating loss carryforwards for U.S. federal and state income tax purposes of $28,178 and non-capital loss carryforwards for Canada of approximately $37,280, which will begin to expire in fiscal year 2035.  We have evaluated the factors bearing upon the realizability of our deferred tax assets, which are comprised principally of net operating loss carryforwards and non-capital loss carryforwards. We concluded that, due to the limitations under Section 382, our U.S. federal and state net operating loss carryfowards for the periods prior to February 11, 2021 have been limited to zero. We therefore have derecognized $20,976 of our U.S deferred tax assets, resulting in a remaining carryforward balance of $7,202.

In Canada, due to the uncertainty of realizing any tax benefits as of December 31, 2021, and June 30, 2022 we continue to fully value our Canadian deferred tax assets.

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Translation of Foreign Currencies

The functional currency, as determined by management, for our subsidiaries in the United States, Switzerland, and Canada is the U.S. dollar, which is also our reporting currency

The functional currency, as determined by management, for our Japanese subsidiary is the Japanese Yen. Japanese Yen are translated for financial reporting purposes with translation gains and losses recorded as a component of other comprehensive income or loss.

Stock-Based Compensation

We measure the cost of equity-settled transactions by reference to the fair value of the equity instruments at the date at which they are granted.

We calculate stock-based compensation using the fair value method, under which the fair value of the options at the grant date is calculated using the Black-Scholes Option Pricing Model, and subsequently expensed over the vesting period of the option using the graded vesting method. The provisions of our stock-based compensation plans do not require us to settle any options by transferring cash or other assets, and therefore we classify the awards as equity. Stock-based compensation expense recognized during the period is based on the value of stock-based payment awards that are ultimately expected to vest. We estimate forfeitures at the time of grant and revise these estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The expected term, which represents the period of time that options granted are expected to be outstanding, is estimated based on an average of the term of the options. The risk-free rate assumed in valuing the options is based on the Canadian treasury yield curve in effect at the time of grant for the expected term of the option. The expected dividend yield percentage at the date of grant is zero as we are not expected to pay dividends in the foreseeable future.

Loss Per Share

Basic loss per share, or EPS, is computed by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.

Comprehensive Loss

We follow ASC topic 220. This statement establishes standards for reporting and display of comprehensive (loss) income and its components. Comprehensive loss is net loss plus certain items that are recorded directly to shareholders’ equity.

Critical Accounting Policies and Significant Judgments and Estimates

Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, and revenue, costs and expenses and related disclosures during the reporting periods. On an ongoing basis, we evaluate our estimates and judgments, including those described below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are more fully described in Note 3 of the notes to our consolidated financial statements appearing elsewhere in this document, management has identified the following as “Critical Accounting Policies and Estimates”: Intangible Assets and Business Combinations, Inventory Reserves, and Revenue Recognition and Liabilities due to Customers. We believe that the estimates and assumptions involved in these accounting policies may have the greatest potential impact on our financial statements.

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Intangible Assets and Business Combinations

Assets acquired and liabilities assumed as part of a business combination are recognized at their acquisition date fair values. In determining these fair values, we utilized various forms of the income, cost and market approaches depending on the asset or liability being valued.

We used a discounted cash flow model to measure the trade names, customer relationship, and technology assets. The estimation of fair value required significant judgment related to future net cash flows based on assumptions related to revenue and EBITDA growth rates, discount rates, and attrition factors. Inputs were generally determined by taking into account competitive trends, market comparisons, independent appraisals, and historical data, among other factors, and were supplemented by current and anticipated market conditions.

Variances in future cash flows, anticipated growth rates and revenue could significantly impact the value assigned to intangible assets. Any variance could cause impairment charges upon testing.

We will evaluate goodwill for impairment annually or more frequently when an event occurs or circumstances change indicating the carrying value may not be recoverable. When testing goodwill for impairment, we may first assess qualitative factors to determine if it is more likely than not the carrying value of a reporting unit exceeds its estimated fair value. During a qualitative analysis, we consider the impact of changes, if any, to the following factors: macroeconomic, industry and market factors; cost factors; changes in overall financial performance; and any other relevant events and uncertainties impacting a reporting unit. If our qualitative assessment indicates a goodwill impairment is more likely than not, we perform additional quantitative analyses. We may also elect to skip the qualitative testing and proceed directly to the quantitative testing. For reporting units where a quantitative analysis is performed, we will perform a test measuring the fair values of the reporting units and comparing them to their aggregate carrying values, including goodwill. If the fair value is less than the carrying value of the reporting unit, an impairment is recognized for the difference, up to the carrying amount of goodwill.

We will estimate the fair values of our reporting units using a discounted cash flow method or a weighted combination of discounted cash flows and a market-based method. The discounted cash flow method includes assumptions about a wide variety of internal and external factors. Significant assumptions used in the discounted cash flow method include financial projections of free cash flow, including revenue trends, medical costs trends, operating productivity, income taxes and capital levels; long-term growth rates for determining terminal value beyond the discretely forecasted periods; and discount rates. Financial projections and long-term growth rates used for our reporting units will be consistent with, and use inputs from, our internal long-term business plan and strategies. Discount rates will be determined for each reporting unit and include consideration of the implied risk inherent in their forecasts. Our most significant estimate in the discount rate determinations involves our adjustments to the peer company weighted average costs of capital reflecting reporting unit-specific factors. We will not make any adjustments to decrease a discount rate below the calculated peer company weighted average cost of capital for any reporting unit. Company-specific adjustments to discount rates are subjective and thus are difficult to measure with certainty. The passage of time and the availability of additional information regarding areas of uncertainty with respect to the reporting units’ operations could cause these assumptions to change in the future. Additionally, as part of our quantitative impairment testing, we will perform various sensitivity analyses on certain key assumptions, such as discount rates, cash flow projections and peer company multiples to analyze the potential for a material impact. The market-based method requires determination of an appropriate peer group whose securities are traded on an active market. The peer group is used to derive market multiples to estimate fair value.

Inventory Reserves

Our Diagnostics segment purchases instruments and places them in inventory. Instruments are removed from inventory and recorded as fixed assets when they are placed with our customers under the agreement that they will repeatedly purchase assays (tests) which are utilized in the instrument. Each instrument placed in the portfolio represents an asset that we own. An estimate is made of the anticipated future revenue over the life of the instrument, based on the sale of assays, which is typically ten years. If the payback period of the initial investment in the asset is less than the ten-year life of the asset, we conclude that the inventory has been properly recorded, and no write-down is necessary. We rely on third-party data that considers various data points and assumptions, including, but not limited to, the expected volume of assays which will be sold, anticipated growth rates and placements of instruments. Realization of the anticipated revenue is dependent on the current assumptions and forecasted models.

The customer is obligated to purchase assays during the placement period. However, since the customer is not obligated to purchase the instrument, and can return it at any time, we are exposed to a risk of loss to the extent the customer returns the instrument and discontinues assay purchases.

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On June 30, 2022, the carrying value of our Diagnostic inventory was $3,218. A significant assumption included in the realization model is a placement rate of two instruments per month, per account manager.

The effect of a 50% reduction in the estimated annual placements of instruments would increase the payback period on June 30, 2022, by 0.43 years.

Changes to placement rates are not expected to decrease, nor do we expect that any decrease would be permanent.

Revenue Recognition and Liabilities Due to Customers

The nature of our Therapeutics business segment gives rise to variable consideration, including discounts and applicator (“trode”) returns. Credits are issued for unused shocks on returned trodes, which can be used toward the purchase of replacement trodes. When revenue is recognized, a simultaneous adjustment for returns is estimated, reducing revenue. Estimated return credits are presented as a reduction to gross sales with the corresponding reserve presented as customer contract liabilities.

Variable consideration related to unused shock credits is calculated using the expected value method, which estimates the amount that is expected to be earned. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur. Estimates of variable consideration are based upon historical experience and known trends. These estimated credits are non-refundable and may only be used towards the purchase of future trode refurbishments. This practice encourages refurbishment purchase prior to complete utilization of the previous trode, so the customer will always have a trode at hand with ample capacity to perform treatments.

The number of trodes returned by year is tracked against the number of trodes sold in that same year, creating a current experience rate. It is assumed that the ultimate return rate for the trodes is 98%. For annual calculations, it is assumed that the expected returns in the current year for each layer increase to the experience rate of the year immediately preceding it. Once the 98% is reached the layer is removed from the calculation. The annual incremental change in expected returns is multiplied by an average return credit amount, generating the current liability due to customers.

The average return credit is calculated by dividing the actual shock credits issued by the actual number of trodes returned. A variance in the assumed return rate compared to the actual rate would impact the estimate and potentially understate net sales (overestimated rate) or overstate net sales (underestimated rate) in any given year and create a corresponding misstatement of the liability due to customers.

On June 30, 2022, the estimated value of our Therapeutics customer contract liability was $313. If the expected return rate was increased by 2%, the effect on current year reduction in sales and increase in customer liability would have been approximately $20.

Results of Consolidated Operations

Revenue

Revenue for the three months ended June 30, 2022 was $4,246, compared to $16 for the three months ended June 30, 2021, an increase of $4,230 or 26,438%. The increase was primarily due to the inclusion of our PulseVet platform which had revenues of $4,154 consisting of instruments, trodes, and warranty services sold worldwide. Revenues from sales of cartridges from our TRUFORMA® platform were $92 compared to $16, an increase of $76 or 475%.

Revenue for the six months ended June 30, 2022 was $7,997, compared to $30 for the six months ended June 30, 2021, an increase of $7,967 or 26,557%. The increase was primarily due to the inclusion of our PulseVet platform which had revenues of $7,849 consisting of instruments, trodes, and warranty services sold worldwide. Revenues from sales of cartridges from our TRUFORMA® platform were $148 compared to $30, an increase of $118 or 393%.

We launched our TRUFORMA® platform in March 2021 and acquired PulseVet in October 2021.  In general, we expect revenue to increase in subsequent periods as we increase our sales and marketing of the PulseVet platform and as additional assays are added to our TRUFORMA® platform.

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Cost of Revenue

Cost of revenue for the three months ended June 30, 2022 was $1,210, compared to $36 for the three months ended June 30, 2021, an increase of $1,174 or 3,261%. Cost of revenue primarily resulted from costs associated with sales of our PulseVet platform which totaled $1,135, as well as $75 from costs associated with sales of our TRUFORMA® platform.

Cost of revenue for the six months ended June 30, 2022 was $2,199, compared to $42 for the six months ended June 30, 2021, an increase of $2,157 or 5,136%. Cost of revenue primarily resulted from costs associated with sales of our PulseVet platform which totaled $2,079, as well as $120 from costs associated with sales of our TRUFORMA® platform.

We anticipate that costs of revenue will increase in 2022 in accordance with the increased revenue as described above.

Gross Profit Margin

Gross profit margin for the three months ended June 30, 2022 was $3,036 or 72%, compared to a loss of $20 for the three months ended June 30, 2021, an increase of $3,056.

Gross profit margin for the six months ended June 30, 2022 was $5,798 or 73%, compared to a loss of $12 for the six months ended June 30, 2021, an increase of $5,810.

The increase in gross profit for both the three and six months ended June 30, 2022 resulted primarily from the inclusion of our PulseVet platform in the first quarter of 2022.  In general, we believe gross margins will remain relatively unchanged due to a variety of factors, including the ability to effectively stimulate demand for certain of our products; management of the cost of components and outside manufacturing services; our ability to manage warranty costs effectively; shifts in the mix of products and services, or in the geographic, currency or channel mix; and fluctuations in exchange rates.

Research and Development

Research and development expense for the three months ended June 30, 2022 was $319, compared to $271 for the three months ended June 30, 2021, an increase of $48 or 18%. The increase was primarily driven by an increase in contracted expenses for research fees and trials as we continue to develop and test our next generation of TRUFORMA® assays.

Research and development expense for the six months ended June 30, 2022 was $670, compared to $684 for the six months ended June 30, 2021, a decrease of $14 or 2%. The decrease was the result of a reduction in research and development activity associated with TRUFORMA® as we completed development of the instrument and three of the first five assays and began commercialization in March of 2021.

We anticipate that R&D costs will increase as we continue development of our additional assays.

Selling, General and Administrative

Selling, general, and administrative expense for the three months ended June 30, 2022 was $8,597, compared to $5,038 for the three months ended June 30, 2021, an increase of $3,559 or 71%. The increase was primarily driven by salaries and stock option expense associated with increased hiring campaigns and the inclusion of PulseVet headcount, PulseVet acquisition related intangible amortization, and an increase in consultant fees for market development, research, specific accounting, and internal control work.

Selling, general, and administrative expense for the six months ended June 30, 2022 was $15,321, compared to $8,505 for the six months ended June 30, 2021, an increase of $6,816 or 80%. The increase was primarily driven by salaries and stock option expense associated with increased hiring campaigns and the inclusion of PulseVet headcount, PulseVet acquisition related intangible amortization, increases in office expense, travel and tradeshow attendance/sponsorships associated with a lifting of COVID restrictions, our TRUFORMA® launch, and marketing of our new line of PulseVet products.

Net Loss

Our net loss for the three months ended June 30, 2022 was $5,273 compared to a loss of $4,711 for the three months ended June 30, 2021, an increase of $562 or 12%.

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Our net loss for the six months ended June 30, 2022 was $9,210 compared to a loss of $8,748 for the six months ended June 30, 2021, an increase of $462 or 5%.

The net loss in each period was attributed to the matters described above. We expect to continue to record net losses in future periods until such time as we have sufficient revenue from product sales to offset our operating expenses.

Cash Flows

Six months ended June 30, 2022 compared to six months ended June 30, 2021

The following table shows a summary of our cash flows for the periods set forth below:

	Six months ended		Six months ended
	June 30, 2022		June 30, 2021		Change
Cash used in operating activities	$	(6,517)	$	(4,376)	$	(2,141)	49%
Cash used in investing activities		(1,643)		(142)	$	(1,501)	1057%
Cash provided by financing activities		—		218,736	$	(218,736)	(100)%
Increase in cash and cash equivalents		(8,160)		214,218	$	(222,378)	(104)%
Effect of exchange rate changes on cash		(29)		—	$	(29)	NA
Cash and cash equivalents, beginning of period		194,952		61,992	$	132,960	214%
Cash and cash equivalents, end of period	$	186,763	$	276,210	$	(89,447)	(32)%

Operating Activities

Net cash used in operating activities for the six months ended June 30, 2022, was $6,517, compared to $4,376 for the six months ended June 30, 2021, an increase in cash used of $2,141, or 49%. The increase in cash used in operations primarily resulted from the increase in our operating loss. In addition, cash used in operations during the six months ended June 30, 2022 included increased salary expenses and inventory purchases, offset in part by an increase in non-cash expenses including stock-based compensation expense and depreciation and amortization.

Investing Activities

Net cash used in investing activities for the six months ended June 30, 2022, was $1,643, compared to $142 for the six months ended June 30, 2021, an increase of $1,501, or 1,057%. Cash used in investing activities during the six months ended June 30, 2022 included an investment in a debt security (at fair value) of $1,000 and expenditures to improve our ecommerce, internal sales, and accounting programs as well as for leasehold improvements.

Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2022, was $0, compared to $218,736 for the six months ended June 30, 2021, a 100% decrease. Cash provided by financing activities in 2021 primarily resulted from proceeds from the February 2021 public offering of our common shares, partially offset by stock issuance costs.

Liquidity and Capital Resources

We have incurred losses and negative cash flows from operations since our inception in May 2015. As of June 30, 2022, we had an accumulated deficit of $128,601.  We have funded our working capital requirements primarily through the sale of our equity and equity-related securities and the exercise of stock options and warrants.

As of June 30, 2022, the Company had cash and cash equivalents of $186,763 and working capital (defined as current assets minus current liabilities) of $190,152.

Short Term Cash Requirements

We believe that our existing cash is sufficient to fund our expected short-term needs. We currently have fixed cash obligations in association with our building leases and quarterly inventory orders. We also have payment obligations associated with our on-going clinical studies and expect that we have sufficient cash to cover these requirements. We do not expect that PulseVet’s operations will require significant increases in our short-term cash needs.

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Long Term Cash Requirements

We believe that our existing cash resources will be sufficient to fund our expected operational requirements through at least December 2024. We regularly evaluate our business plans and strategy. These evaluations often result in changes to our business plans and strategy, some of which may be material and significantly change our cash requirements. Ongoing business development activity may also require us to use some of our liquidity for an acquisition, and use of additional capital to fund newly acquired operations. If we raise additional funds by issuing equity securities, our existing security holders will likely experience dilution; and the incurring of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that could restrict operations.

Our future capital requirements depend on many factors, including, but not limited to:

● the costs and timing of our development and commercialization activities;

● the cost of manufacturing our existing and future products;

● the cost of marketing and selling our existing and future products including marketing, sales, service, customer support and distribution costs;

● the expenses needed to attract and retain skilled personnel;

● the costs associated with being a public company;

● the costs associated with additional business development or mergers and acquisitions activity, including acquisition-related costs, earn-outs or other contingent payments and costs of developing and commercializing any technologies to which we obtain rights;

● third-party costs associated with the development and commercialization of our existing and future products and the ability of our development partners to satisfy our requirements on a timely basis;

● the scope and terms of our business plans from time to time, and our ability to realize upon our business plans; and

● the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing possible patent claims, including litigation costs and the outcome of any such litigation.

Outstanding Share Data

The only class of outstanding voting equity securities of the Company are the common shares. As of August 15, 2022:

● there are 979,949,668 common shares issued and outstanding;

● there are stock options outstanding under our Stock Option Plan to acquire an aggregate of 61,507,724 common shares

● there are common share purchase warrants outstanding to acquire an aggregate of 197,917 common shares at an exercise price of $0.15 per share issued in February 2020.

● there are common share purchase warrants outstanding to acquire an aggregate of 363,501 common shares at an exercise price of $0.15 per share issued in April 2020.

● All of the currently outstanding warrants also have a “cashless exercise” feature which is applicable in certain circumstances. The cashless exercise feature could result in the potential issuance of common shares based upon the “in-the-money” value of the applicable warrants at the time of exercise of the applicable warrants. The number of the common shares that may be issued is not determinable. However, the number of common shares that are issuable is based upon a formula contained in the applicable warrants, which determines the number of common shares issuable by dividing the “in-the-money” value (based upon the then current market price, as provided in the applicable warrants) by the then current market price and multiplying this result by the number of common shares that are issuable under the applicable

● warrants pursuant to cash exercise.

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Recently Adopted Accounting Pronouncements

From time to time, the Financial Accounting Standards Board ("FASB") or other standard setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification ("ASC") are communicated through issuance of an Accounting Standards Update ("ASU"). Unless otherwise discussed, we believe that recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on our Consolidated Financial Statements upon adoption.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Evaluation of Our Disclosure Controls

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that material information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and to provide reasonable assurance that such information is accumulated and communicated to our management, our chief executive officer and our chief financial officer, to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13(a)-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and our principal financial officer concluded that, as of June 30, 2022, our disclosure controls and procedures were effective.

Changes in Internal Controls

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Exchange Act) during the period covered by this Quarterly Report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

Item 1A. Risk Factors.

Risks Related to Our Recently Completed Acquisition of Revo Squared LLC

We have incurred and will continue to incur transaction and integration costs in connection with the acquisition of Revo Squared. These expenses could materially and adversely affect our results of operations.

We have incurred significant costs associated with the negotiation and consummation of the Revo Squared acquisition and expect to incur additional costs in connection with the integration of its operations. The substantial majority of these costs will be non-recurring expenses and will consist of transaction costs (e.g., legal, accounting), facilities and systems consolidation costs and employment-related costs. Additional unanticipated costs may be incurred in the integration of our businesses. These expenses could materially and adversely affect our results of operations.

The failure to integrate Revo Squared successfully into our business could have a material adverse effect on our results of operations and financial condition.

In order to realize the expected benefits of the Revo Squared acquisition, we must successfully integrate the operations or Revo Squared with our existing operations. The integration of Revo Squared will be a time-consuming and expensive process and could significantly disrupt our business. The anticipated benefits of the transaction, including the realization of revenue, tax benefits, financial benefits or returns and expense and other synergies, may not be fully realized, or may take longer to realize than expected, and the integration may be more expensive or require more senior management involvement than expected or be more disruptive to our existing operations than anticipated. In addition, the COVID-19 pandemic-related risks may result in unanticipated regulatory, planning and/or operational delays that may adversely impact the anticipated timeline and achievement of our ongoing integration goals. The integration process may result in the loss of key employees, the disruption of ongoing business or inconsistencies in standards, controls, procedures and policies. Our failure to successfully integrate the operations of Revo Squared or to otherwise realize any of the anticipated benefits of the acquisition could have a material adverse effect on our results or operations.

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The failure to realize the anticipated growth opportunities from our acquisition of Revo Squared could have a material adverse effect on our results of operations and financial condition.

We may not realize the expected growth opportunities from our acquisition of Revo Squared even if we are able to integrate Revo Squared’s business successfully. We may incur unanticipated costs related to the operation of Revo Squared and we may not achieve the growth potential for the Revo Squared business that we expected at the time of acquisition or on our expected time schedule as a result of a number of factors, including our inability to successfully cross-market our or Revo Squared’s products. Accordingly, the benefits from the proposed acquisition may be offset by costs incurred or delays in integrating the companies, which could cause our operational and growth assumptions to be inaccurate. Our failure to realize the anticipated growth opportunities from our acquisition of Revo Squared could have a material adverse effect on our results of operations and financial condition.

Risks Related to Our Recently Completed Acquisition of Assisi Animal Health LLC

We have incurred and will continue to incur transaction and integration costs in connection with the acquisition of Assisi. These expenses could materially and adversely affect our results of operations.

We have incurred significant costs associated with the negotiation and consummation of the Assisi acquisition and expect to incur additional costs in connection with the integration of its operations. The substantial majority of these costs will be non-recurring expenses and will consist of transaction costs (e.g., legal, accounting), facilities and systems consolidation costs and employment-related costs. Additional unanticipated costs may be incurred in the integration of our businesses. These expenses could materially and adversely affect our results of operations.

The failure to integrate Assisi successfully into our business could have a material adverse effect on our results of operations and financial condition.

In order to realize the expected benefits of the Assisi acquisition, we must successfully integrate the operations or Assisi with our existing operations. The integration of Assisi will be a time-consuming and expensive process and could significantly disrupt our business. The anticipated benefits of the transaction, including the realization of revenue, tax benefits, financial benefits or returns and expense and other synergies, may not be fully realized, or may take longer to realize than expected, and the integration may be more expensive or require more senior management involvement than expected or be more disruptive to our existing operations than anticipated. In addition, the COVID-19 pandemic-related risks may result in unanticipated regulatory, planning and/or operational delays that may adversely impact the anticipated timeline and achievement of our ongoing integration goals. The integration process may result in the loss of key employees, the disruption of ongoing business or inconsistencies in standards, controls, procedures and policies. Our failure to successfully integrate the operations of Assisi or to otherwise realize any of the anticipated benefits of the acquisition could have a material adverse effect on our results or operations.

The failure to realize the anticipated growth opportunities from our acquisition of Assisi could have a material adverse effect on our results of operations and financial condition.

We may not realize the expected growth opportunities from our acquisition of Assisi even if we are able to integrate Assisi’s business successfully. We may incur unanticipated costs related to the operation of Assisi and we may not achieve the growth potential for the Assisi business that we expected at the time of acquisition or on our expected time schedule as a result of a number of factors, including our inability to successfully cross-market our or Assisi’s products. Accordingly, the benefits from the proposed acquisition may be offset by costs incurred or delays in integrating the companies, which could cause our operational and growth assumptions to be inaccurate. Our failure to realize the anticipated growth opportunities from our acquisition of Assisi could have a material adverse effect on our results of operations and financial condition.

The Company’s operations and performance depend on global and regional economic conditions and adverse economic conditions can adversely affect the Company’s business, results of operations and financial condition.

Adverse macroeconomic conditions, including inflation, slower growth or recession, new or increased tariffs and other barriers to trade, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment and currency fluctuations can materially adversely affect demand for the Company’s products and services. In addition, consumer confidence and spending can be adversely affected in response to financial market volatility, negative financial news, conditions in the real estate and mortgage markets, declines in income or asset values, changes to fuel and other energy costs, labor and healthcare costs and other economic factors.

In addition to an adverse impact on demand for the Company’s products, uncertainty about, or a decline in, global or regional economic conditions can have a significant impact on the Company’s suppliers, logistics providers, distributors, and other channel partners. Potential effects include financial instability; inability to obtain credit to finance operations and purchases of the Company’s products; and insolvency.

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Item 6. Exhibits.

The exhibits listed on the accompanying index to exhibits immediately preceding the exhibits are filed as part of, or hereby incorporated by reference into, this Quarterly Report.

EXHIBIT INDEX

Exhibit  No.	Description
2.1	Stock Purchase Agreement, dated October 1, 2021, by and between Zomedica Inc. and Branford PVT Mid-Hold, LLC (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on October 1, 2021 (File No. 001-38298))
2.2	Asset Purchase Agreement, dated June 14, 2022, by and between Zomedica Inc. Revo Squared LLC, the Principal Member (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 21, 2022 (File No. 001-38298))
3.1	Articles of Amalgamation of Zomedica Corp. and all amendments thereto, as well as all Certificates issued in respect thereto as well as all Certificates issued in respect thereto (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed with the Commission on May 12, 2021 (File No. 001-38298))
3.2	Amended and Restated By-Law No. 1 (2nd Version) of Zomedica Pharmaceuticals Corp. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Commission on August 7, 2020 (File No. 001-38298))
10.1+	Consulting Agreement, effective March 1, 2022, by and between Zomedica Inc. and Johnny D. Powers (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed with the commission on May 10, 2022 (File No. 001-38298))
10.2	Consulting Agreement, effective June 17, 2022, by and between Zomedica Corp. and Dr. Stephanie Morley
10.3	Lease Agreement, effective April 1, 2022, by and between Zomedica Inc. and ULF Northfield Business Center
10.4	Note receivable agreement, effective May 16, 2022, by and between Zomedica, Inc. and Structured Monitoring Products, Inc.
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
101.INS	Inline XBRL Instance Document (the Instance Document does not appear in the Interactive Data File because its XBRL (1).
101.SCH	Inline XBRL Taxonomy Extension Schema Document (1).
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document (1).
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document (1).
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document (1).
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document (1).
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101.1)

(1) These interactive date files shall not be deemed filed for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability under those sections.

* This certification is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the registrant specifically incorporates it by reference.

+ Indicates management contract or compensatory plan.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Zomedica Corp.
August 15, 2022	By:	/s/ Larry Heaton
	Name:	Larry Heaton
	Title:	Chief Executive Officer
August 15, 2022	By:	/s/ Ann Marie Cotter
	Name:	Ann Marie Cotter
	Title:	Chief Financial Officer

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EX-10.2

CONSULTING AGREEMENT

This Consulting Agreement (this “Agreement”) is made effective as of June 17, 2022, between ZOMEDICA INC. (the “Company”) and DR. STEPHANIE MORLEY (Dr. Morley).

1.Services. Dr. Morley is engaged to perform periodic consulting services related to business strategy, veterinary practice, the value of certain products and technology, trends in veterinary medicine, and similar topics at the Company’s request on an as needed basis (the “Services”). Services shall be provided at the Company's discretion, as it may so direct and as agreeable to Dr. Morley and workable with her schedule.

2.Contractor Status. Dr. Morley shall be an independent contractor and as such shall not be eligible to participate in employee benefit programs. Dr. Morley shall be responsible to withhold and pay any taxes related to any services provided to the Company.

3.Fees. The Company shall pay Dr. Morley a flat fee of $120,165. The fee shall be paid within 15 days of the execution of this Agreement.

4.Options. The Company shall issue Dr. Morley 3,100,000 options in accordance with the Option Agreements attached hereto as Exhibits A.

5.Term. The term of this Agreement shall commence on the effective date of this Agreement and shall continue for twenty-four (24) months, upon which date it will terminate unless extended or renewed by mutual written agreement of the parties (“Term”). Prior to the expiration of the Term, the Company may terminate this Consulting Agreement in the event of a breach of the Agreement.

6.Compliance. Dr. Morley will at all times act in compliance with all applicable laws and regulations, as well as Company rules of conduct, whether now existing or hereinafter enacted, whenever on Company premises or otherwise in connection with providing Services.

7. Confidential Information. This Agreement is subject to the terms of the Confidentiality Agreement entered into between the parties as of May 14, 2021 (the “Confidentiality Agreement”).

8. Assignment of Invention. In the event that, as a function of the relationship described in this Agreement or the receipt of any Company Confidential Information (as that term is defined in the Confidentiality Agreement), any intellectual property is developed or created by Dr. Morley, Dr. Morley shall so notify the Company and such intellectual property promptly shall be assigned to the Company without any cost to the Company other than the administrative cost of such assignment. All documents, materials and property developed by Dr. Morley pursuant to this Agreement are the sole property of the Company.

9.Duty Upon Termination or Request for Return of Property. In the course of performance of any duties assigned to Dr. Morley by the Company under this Agreement, Dr. Morley may be provided access to confidential information about the Company (“Confidential Information”),

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including but not limited to information concerning its plans, finances, properties, current and future projects and the like. Dr. Morley shall, upon termination of this Agreement or request by the Company, return or destroy all Confidential Information and/or Company documents that may be in Dr. Morley’s possession.

10.Severability. In the event any provisions of this Agreement shall be held to be invalid or unenforceable, the same shall be enforced to the maximum extent permitted by law, and further shall not affect the validity or enforceability of any other provisions of this Agreement.

11.Amendment. This Agreement may not be modified except by a written agreement signed by all parties that expressly references and purports to modify this Agreement.

12.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state of Michigan, without regard to conflict of law principles.

13.Survivability. Section 2 (with respect to taxes), 7, 8, 9, 10, 11 and 12 hereinabove shall survive the termination or expiration of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

ZOMEDICA INC.

By: ______________________

Its: ______________________

Dr. Stephanie Morley

__________________________

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EXHIBIT A

OPTION AGREEMENTS

[Attach Option Agreements]

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EX-10.3

Exhibit 10.3

DocuSign Envelope ID: F1C39DC7-6C8A-43AC-A65B-96212EC7F087 March 18,

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EX-10.4

Exhibit 10.4

THIS NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATES IN THE UNITED STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

CONVERTIBLE PROMISSORY NOTE

$1,000,000.00‌May 16, 2022

Subject to the terms and conditions of this Convertible Promissory Note (the “Note”), for value received, Structured Monitoring Products, Inc., a Florida corporation (the “Company”), promises to pay to Zomedica Inc., a Delaware corporation, or such party’s assigns (the “Holder”), having an address at 100 Phoenix Drive, Suite 190, Ann Arbor, Michigan 48108, or such other place as the Holder may designate in writing from time to time, the principal amount of One Million and no/100 dollars ($1,000,000.00), together with simple interest on the principal amount outstanding from time to time at the rate of eight percent (8.0%) per annum. Interest shall commence to accrue on the date of this Note and shall continue on the outstanding principal amount until paid in full or converted. Interest shall be computed on the basis of a year of 365 days for the actual number of days elapsed. The outstanding principal amount, the accrued interest thereon and all other amounts due hereunder are referred to herein as the “Debt Amount.” Unless earlier converted, the entire Debt Amount shall become due and payable on the two year anniversary of the date of this Note (May 16, 2024) (the “Maturity Date”).

1.Basic Terms.

(a)Purchase Agreement. This Note is issued by the Company pursuant to that certain Convertible Note Purchase Agreement dated as of the date hereof (the “Purchase Agreement”), entered into between the Company and the Lender, and is subject to, and the Company and the Holder shall be bound by, all the terms, conditions and provisions of the Purchase Agreement. Capitalized terms used herein but not defined herein shall have the meanings ascribed to them in the Purchase Agreement.

(b)Payments. All payments of interest and principal shall be in lawful money of the United States of America. All payments shall be applied first to the payment of accrued fees and expenses under this Note (including, without limitation, costs of collection), then to the payment of accrued interest, and thereafter to the repayment of principal.

(c)Extension of the Maturity Date. If the Holder exercises the Commercial Option (as defined in the Purchase Agreement), the Company may elect to extend the Maturity Date until the expiration of the Commercial Period by delivering written notice of such election to the Holder at the time of the Holder’s exercise of the Commercial Option.

(d)Prepayment. The Company may not prepay this Note prior to the Maturity Date without the consent of the Holder.

(e)Most Favored Nations. If, while this Note is outstanding, the Company issues other indebtedness of the Company convertible into equity securities of the Company, or amends any existing indebtedness convertible into equity securities of the Company, and such newly issued or amended indebtedness would have material terms that are more favorable, from the perspective of the Holder (the “Other Debt”), than the terms of this Note, then the Company will provide the Holder with written notice thereof, together with a copy of all documentation relating to the Other Debt and, upon request of the Holder, any additional information related to the Other Debt as may be reasonably requested by the Holder. The Company will provide such notice to the Holder promptly (and in any event within 30 days) following the issuance of the Other Debt. In the event the Holder determines that the terms of the Other Debt are preferable to the terms of this Note, the Holder will notify the Company in writing within five days following the Holder’s receipt of such notice from the Company. Promptly after receipt of such written notice from the Holder, but in any event within 30 days, the Company will amend and restate this Note and the Purchase Agreement to be substantially identical to the promissory note evidencing the Other Debt, excluding the principal and unpaid accrued interest.

2.Conversion and Repayment.

(a)Optional Conversion at the Election of the Holder. Subject to and upon compliance with the provisions of this Section 2, the Holder shall have the right, at its option, at any time and from time to time, so long as any amount remains payable under this Note, to convert all or any part of the outstanding Debt Amount into shares of the Company’s preferred stock (the “Holder Preferred Stock”) at a conversion price per share equal to the quotient resulting from dividing $7,000,000 by the number of outstanding shares of Common Stock of the Company immediately prior to the Qualified Financing (assuming conversion of all securities convertible into Common Stock and exercise of all outstanding options and warrants, but excluding the shares of equity securities of the Company issuable upon the conversion of the Note) (the “Conversion Price”). The Holder Preferred Stock be, or shall be pari passu with, the most senior class of the Company’s capital stock outstanding at the time of such conversion, and shall contain broad-based anti-dilution protection against “Additional Issuances of Common Stock” in substantially the form set forth in the form of Certificate of Incorporation included in the model documents prepared and publicized by the National Venture Capital Association; provided, however, that if the most senior class of the Company’s capital stock outstanding at the time of such conversion has anti-dilution protection against “Additional Issuances of Common Stock” that is more advantageous to the holders thereof than the provisions set forth on Exhibit A, the Holder Preferred Stock shall contain the more advantageous protection. For purposes of this subsection, “Additional Shares of Common Stock” means all shares of Common Stock of the Company issued by the Company after the conversion date of this Note, other than (i) shares of Common Stock, Options or Convertible Securities issued by reason of a dividend, stock split, split-up or other distribution on shares of Common Stock for which anti-dilution protection separately applies, (ii) shares of Common Stock actually issued upon the exercise of Options or shares of Common Stock actually issued upon the conversion or exchange of Convertible Securities, in each case provided such issuance is pursuant to the terms of such Option or Convertible Security; and (iii) shares of Common Stock (or options or warrants to purchase such shares of Common Stock) issued or issuable to employees or directors of, or consultants to, the Company pursuant to any incentive plan approved by the Company’s Board of Directors.

(b)Conversion upon a Qualified Financing. In the event that the Company issues and sells shares of its equity securities ( “Equity Securities”) to investors (the “Investors”) while this Note remains outstanding in an equity financing with total proceeds to the Company of not less than $1,000,000 (excluding the conversion of the Notes or other convertible securities issued for capital raising purposes (e.g., Simple Agreements for Future Equity)) (a “Qualified Financing”), then the Holder shall have the right, at its option, to convert the outstanding Debt Amount in whole or in part into Equity Securities sold in the Qualified Financing at a conversion price equal to the lesser of (i) the cash price

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paid per share for Equity Securities by the Investors in the Qualified Financing multiplied by 0.85, and (ii) the quotient resulting from dividing $7,000,000 by the number of outstanding shares of Common Stock of the Company immediately prior to the Qualified Financing (assuming conversion of all securities convertible into Common Stock and exercise of all outstanding options and warrants, but excluding the shares of equity securities of the Company issuable upon the conversion of the Note). The issuance of Equity Securities pursuant to the conversion of this Note shall be upon and subject to the same terms and conditions applicable to Equity Securities sold in the Qualified Financing.

(c)Optional Conversion at non-Qualified Financing. In the event the Company consummates, while this Note remains outstanding, an equity financing pursuant to which it sells shares of Equity Securities in a transaction that does not constitute a Qualified Financing, then the Holder shall have the option to treat such equity financing as a Qualified Financing on the same terms set forth herein.

(d)Change of Control. If the Company consummates a Change of Control (as defined below) while this Note remains outstanding, the Company shall repay the Holder in cash in an amount equal to the entire outstanding Debt Amount; provided, however, that upon the written election of the Holder made not less than five days prior to the Change of Control, the Company shall convert the outstanding Debt Amount into shares of the Company’s Common Stock at a conversion price equal to the quotient resulting from dividing $7,000,000 by the number of outstanding shares of Common Stock of the Company immediately prior to the Change of Control (assuming conversion of all securities convertible into Common Stock and exercise of all outstanding options and warrants, but excluding the shares of equity securities of the Company issuable upon the conversion of Note. For purposes of this Note, a “Change of Control” means (i) a consolidation or merger of the Company with or into any other corporation or other entity or person, or any other corporate reorganization, other than any such consolidation, merger or reorganization in which the shares of capital stock of the Company immediately prior to such consolidation, merger or reorganization continue to represent a majority of the voting power of the surviving entity immediately after such consolidation, merger or reorganization; (ii) any transaction or series of related transactions to which the Company is a party in which in excess of 50% of the Company’s voting power is transferred; or (iii) the sale or transfer of all or substantially all of the Company’s assets, or the exclusive license of all or substantially all of the Company’s material intellectual property; provided that a Change of Control shall not include any transaction or series of transactions principally for bona fide equity financing purposes in which cash is received by the Company or any successor, indebtedness of the Company is cancelled or converted or a combination thereof. The Company shall give the Holder notice of a Change of Control not less than 10 days prior to the anticipated date of consummation of the Change of Control. Any repayment pursuant to this paragraph in connection with a Change of Control shall be subject to any required tax withholdings, and may be made by the Company (or any party to such Change of Control or its agent) following the Change of Control in connection with payment procedures established in connection with such Change of Control.

(e)Procedure for Conversion. In connection with any conversion of this Note into capital stock, the Holder shall surrender this Note to the Company accompanied by a written notice (the “Conversion Notice”) stating that the Holder elects to convert all or part of the outstanding Debt Amount, specifying the portion of the Debt Amount which the Holder desires to convert, and setting forth the name or names in which the certificate or certificates for shares of capital stock to be issued upon such conversion shall be issued, together with any documentation reasonably required by the Company (including, in the caseof a Qualified Financing, all financing documents executed by the Investors in connection with such Qualified Financing). As promptly as practicable but in no event later than five (5) business days after the receipt of the Conversion Notice and the surrender to the Company of the Note, the Company shall issue and deliver to the Company a certificate or certificates for the number of shares of capital stock issuable upon such conversion, together with, if less than the total Debt Amount is then being converted, a new promissory note, dated the original issue date hereof, in the form hereof but

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reflecting a principal amount equal to the principal amount of the Debt Amount that has not been so converted. Such conversion shall be deemed to have been effected at the close of business on the date on which the Company receives the Conversion Notice unless the Conversion Notice provides for a different (and the person or persons in whose name or names any certificate or certificates for shares of capital stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of such shares represented thereby on such date); except that in the case of a conversion in connection with a Qualified Financing or a Change of Control, the conversion shall be deemed to have been effected at the closing of the Qualified Financing or Change of Control, as applicable. Upon the conversion of this Note into capital stock pursuant to the terms hereof, in lieu of any fractional shares to which the Holder would otherwise be entitled, the Company shall pay the Holder cash equal to such fraction multiplied by the price at which this Note converts.

(f)Interest Accrual. Solely for purposes of calculating the number of shares of capital stock of the Company issuable upon a conversion in connection with a Change of Control or Qualified Financing, all interest on this Note shall be deemed to have stopped accruing as of a date selected by the Company that is no earlier than 10 days prior to the closing date of the Change of Control or Qualified Financing, as applicable.

(g)Reservation of Shares. So long as this Note remains outstanding, the Company shall at all times reserve and keep available out of its authorized but unissued shares of capital stock the full number of shares of capital stock of the class or series which shall be issuable at any time and from time to time upon the exercise of the conversion rights pursuant to this Section 2.

(h)No Impairment. The Company will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action avoid the observance or performance or any of the terms to be observed or performed hereunder by the Company, but at all times and in good faith will assist in the carrying out of all of the provisions of this Note and in the taking of all such actions as may be necessary or appropriate in order to protect the conversion rights of the Holder against impairment.

3.Events of Default.

(a)Any of the following events shall constitute an “Event of Default” hereunder:

(i)If the Company shall fail to pay, when due, any amounts required to be paid by the Company under this Note or the Purchase Agreement;

(ii)If any of the Company’s representations and warranties contained in the Purchase Agreement shall prove to have not been true in any material respect when made;

(iii)If the Company defaults in the performance of or compliance with any covenant or agreement contained in this Note (other than the Event of Default set forth in Section 3(a) hereof) or the Purchase Agreement (other than Section 7.4 thereof) and such default shall not have been remedied within ten (10) business days after written notice thereof shall have been given to the Company by the Holder;

(iv)If the Company defaults in the performance of or compliance with Section 7.4 of the Purchase Agreement; or

(v)If the Company makes an assignment for the benefit of creditors, or admits in writing the Company’s inability to pay its debts as they become due, or files a voluntary petition

4

in bankruptcy, or is adjudicated a bankruptcy or insolvent, or files any petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any present or future statute, law or regulation, or files any answer admitting or fails to deny the material allegations of a petition filed against the Company for any such relief, or seeks or consents to or acquiesces in the appointment of any trustee, receiver or liquidator of the Company or of all or any substantial part of the properties of the Company; or takes any corporate action in furtherance of any of the foregoing.

(b)If an Event of Default hereunder shall have occurred and shall be continuing, the Holder may declare the entire outstanding Debt Amount to be due and payable immediately and may demand immediate payment thereof, and may further proceed to protect and enforce the rights of such proceeding, whether for the specific performance of any agreement contained herein or for an injunction against a violation of any of the terms hereof or in aid of the exercise of any right, power or remedy granted thereby or by law, equity, statute or otherwise; provided, however, that the entire Debt Amount shall automatically accelerate and become immediately due and payable upon an Event of Default pursuant to Section 3(a)(v) without presentment, demand, notice, protest, declaration, or any other requirement of any kind, all of which the Company hereby expressly waives. No course of dealing and no delay on the part of the Company in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice the Holder’s rights, power or remedies. No right, power or remedy conferred hereby shall be exclusive of any right, power or remedy referred to herein or now or hereafter available at law, in equity, by statute or otherwise. In the event of any Event of Default hereunder, the Company shall pay all reasonable attorneys’ fees and court costs incurred by the Holder in enforcing and collecting this Note.

4.Miscellaneous Provisions.

(a)Waivers. The Company hereby waives demand, notice, presentment, protest and notice of dishonor.

(b)Transfers of Note. This Note may be transferred only upon its surrender to the Company for registration of transfer, duly endorsed, or accompanied by a duly executed written instrument of transfer in form satisfactory to the Company. Thereupon, this Note shall be reissued to, and registered in the name of, the transferee, or a new Note for like principal amount and interest shall be issued to, and registered in the name of, the transferee. Interest and principal shall be paid solely to the registered holder of this Note. Such payment shall constitute full discharge of the Company’s obligation to pay such interest and principal.

(c)New Note. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of the Note, the Company will issue a new Note, of like tenor and amount, in lieu of such lost, stolen, destroyed or mutilated Note, and in such event the Holder agrees to indemnify and hold harmless the Company in respect of any such lost, stolen, destroyed or mutilated Note.

(d)Market Standoff. To the extent requested by the Company or an underwriter of securities of the Company, the Holder and any permitted transferee thereof shall not, without the prior written consent of the managing underwriters in the IPO (as hereafter defined), offer, sell, make any short sale of, grant or sell any option for the purchase of, lend, pledge, otherwise transfer or dispose of (directly or indirectly), enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership (whether any such transaction is described above or is to be settled by delivery of Securities or other securities, in cash, or otherwise), any securities issued upon conversion of this Note, or other shares of stock of the Company then owned by the Holder or any

5

transferee thereof, or enter into an agreement to do any of the foregoing, for up to 180 days following the effective date of the registration statement of the initial public offering of the Company (the “IPO”) filed under the Securities Act. For purposes of this paragraph, “Company” includes any wholly owned subsidiary of the Company into which the Company merges or consolidates. The Company may place restrictive legends on the certificates representing the shares subject to this paragraph and may impose stop transfer instructions with respect to the Securities and such other shares of stock of the Holder and any transferee thereof (and the shares or securities of every other person subject to the foregoing restriction) until the end of such period. The Holder and any transferee thereof shall enter into any agreement reasonably required by the underwriters to the IPO to implement the foregoing within any reasonable timeframe so requested. The underwriters for any IPO are intended third party beneficiaries of this paragraph and shall have the right, power and authority to enforce the provisions of this paragraph as though they were parties hereto.

(e)Amendment and Waiver. Any term of this Note may be amended or waived with the written consent of the Company and the Holder.

(f)Governing Law. This Note shall be governed by and construed under the laws of the State of Delaware, as applied to agreements among Delaware residents, made and to be performed entirely within the State of Delaware, without giving effect to conflicts of laws principles.

(g)Binding Agreement. The terms and conditions of this Note shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Note, expressed or implied, is intended to confer upon any third party any rights, remedies, obligations or liabilities under or by reason of this Note, except as expressly provided in this Note.

(h)Severability. If any provision or part of any provision of this Note shall for any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Note and this Note shall be construed as if such invalid, illegal or unenforceable provision or part thereof had never been contained herein, but only to the extent of its invalidity, illegality or unenforceability.

(i)Counterparts; Manner of Delivery. This Note may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act or other applicable law) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

(j)Titles and Subtitles. The titles and subtitles used in this Note are used for convenience only and are not to be considered in construing or interpreting this Note.

(k)Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (i) when delivered, if personally delivered; (ii) on the next business day after dispatch, if sent postage pre-paid by nationally recognized, overnight courier guaranteeing next business day delivery; (iii) if sent by e-mail of a PDF document, the date when sent by email sent to the email address for the sender stated in this Section 4(k) (provided that, unless receipt of such email is acknowledged, such email is followed up within one business day by dispatch pursuant to one of the other methods described herein), or (iv) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications to a party must be sent to the party’s address set forth on the signature page hereto (or at such other address for a party as shall be specified in a notice given in accordance with this Section 4(k).

6

(l)Expenses. The Company and the Holder shall each bear its respective expenses and legal fees incurred with respect to the negotiation, execution and delivery of this Note and the transactions contemplated herein.

(m)Delays or Omissions. It is agreed that no delay or omission to exercise any right, power or remedy accruing to the Holder, upon any breach or default of the Company under this Note shall impair any such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character by the Holder of any breach or default under this Note, or any waiver by the Holder of any provisions or conditions of this Note, must be in writing and shall be effective only to the extent specifically set forth in writing and that all remedies, either under this Note, or by law or otherwise afforded to the Holder, shall be cumulative and not alternative. This Note shall be void and of no force or effect in the event that the Holder fails to remit the full principal amount to the Company within five calendar days of the date of this Note.

(n)Entire Agreement. This Note, together with the Purchase Agreement, constitutes the full and entire understanding and agreement between the parties with regard to the subjects hereof, and no party shall be liable or bound to any other party in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein.

(o)Broker’s Fees. Each party hereto represents and warrants that no agent, broker, investment banker, person or firm acting on behalf of or under the authority of such party hereto is or will be entitled to any broker’s or finder’s fee or any other commission directly or indirectly in connection with the transactions contemplated herein. Each party hereto further agrees to indemnify each other party for any claims, losses or expenses incurred by such other party as a result of the representation in this subsection being untrue.

[Signature pages follow]

7

Exhibit 10.4

The parties have executed this Convertible Promissory Note as of the date first noted above.

COMPANY:
Structured Monitoring Products, Inc.
By:	/s/ Vik Ramprakash
	Name:	Vikram Ramprakash
	Title:	Chief Executive Officer
E-mail:		vik.ramprakash@structuredmp.com
Address:		151 Innovation Drive, Suite 320 Elyria, OH 44035 Attention: Chief Executive Officer

Acknowledged and agreed by the Holder:
Zomedica Inc.
By:	/s/ Larry Heaton
	Name:	Larry Heaton
	Title:	Chief Executive Officer
E-mail:		lheaton@zomedica.com
Address:		100 Phoenix Drive, Suite 190 Ann Arbor, MI 48108 Attention: Chief Financial Officer

SIGNATURE PAGE TO

CONVERTIBLE PROMISSORY NOTE

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Larry Heaton, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the three months ended June 30, 2022 of Zomedica Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 15, 2022

/s/ Larry Heaton

Larry Heaton

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ann Marie Cotter, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the three months ended June 30, 2022 of Zomedica Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 15, 2022

/s/ Ann Marie Cotter

Ann Marie Cotter

Chief Financial Officer

(Principal Financial and Accounting Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF

THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002, 18 U.S.C. SECTION 1350

In connection with the Quarterly Report on Form 10-Q of Zomedica Corp. (the “Company”) for the three months ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned Larry Heaton, Chief Executive Officer of the Company, and Ann Marie Cotter, Chief Financial Officer of the Company, hereby certify, to the knowledge of the undersigned, pursuant to 18 U.S.C. Section 1350, that:

(1) The Report fully complies with the requirements of Section13(a)or 15(d)of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 15, 2022

/s/ Larry Heaton

Larry Heaton

Chief Executive Officer

(Principal Executive Officer)

Date: August 15, 2022

/s/ Ann Marie Cotter

Ann Marie Cotter

Chief Financial Officer

(Principal Financial and Accounting Officer)

This Certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Report, irrespective of any general incorporation language contained in such filing.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover - shares	6 Months Ended
	Jun. 30, 2022	Aug. 15, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2022
Document Transition Report	false
Entity File Number	001-38298
Entity Registrant Name	Zomedica Corp.
Entity Incorporation State Country Code	Z4
Entity Tax Identification Number	00-0000000
Entity Address Address Line 1	100 Phoenix Drive
Entity Address Address Line 2	Suite 125
Entity Address City Or Town	Ann Arbor
Entity Address State Or Province	MI
Entity Address Postal Zip Code	48108
City Area Code	734
Local Phone Number	369-2555
Security 12b Title	Common Shares
Trading Symbol	ZOM
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock Shares Outstanding		979,949,668
Entity Central Index Key	0001684144
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Amendment Flag	false

XML

Consolidated balance sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 186,763	$ 194,952
Inventory, net	4,819	2,848
Prepaid expenses and deposits	2,315	1,842
Trade receivables, net	414	315
Other receivables	315	450
Total current assets	194,626	200,407
Prepaid expenses and deposits	331	394
Property and equipment, net	1,710	1,130
Assets in process	523	420
Right-of-use asset	1,638	1,320
Goodwill	43,288	43,288
Intangible assets, net	32,097	33,176
Debt security (at fair value)	1,000	0
Other assets	265	265
Total assets	275,478	280,400
Current liabilities
Accounts payable and accrued liabilities	3,491	3,225
Accrued income taxes	41	240
Current portion of lease obligations	523	415
Customer contract liabilities	153	198
Other current liabilities	266	262
Total current liabilities	4,474	4,340
Lease obligations	1,184	964
Deferred tax liabilities	3,048	3,709
Customer contract liabilities	161	140
Other liabilities	391	361
Total liabilities	9,258	9,514
Commitments and contingencies (Note 14)
Shareholders' equity
Unlimited common shares, no par value; 979,899,668 issued and outstanding at June 30, 2022 and December 31, 2021	380,962	380,962
Additional paid-in capital	13,846	9,313
Accumulated deficit	(128,601)	(119,391)
Accumulated comprehensive income	13	2
Total shareholders' equity	266,220	270,886
Total liabilities and shareholders' equity	$ 275,478	$ 280,400

XML

Consolidated balance sheets (Parenthetical) - $ / shares	Jun. 30, 2022	Dec. 31, 2021
Consolidated balance sheets
Capital stock, no par value (in dollars per share)	$ 0	$ 0
Capital stock, issued (in shares)	979,899,668	979,899,668
Capital stock, outstanding (in shares)	979,899,668	979,899,668

XML

Consolidated statements of loss and comprehensive loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Consolidated statements of loss and comprehensive loss
Net revenue	$ 4,246	$ 16	$ 7,997	$ 30
Cost of revenue	1,210	36	2,199	42
Gross profit (loss)	3,036	(20)	5,798	(12)
Expenses
Research and development	319	271	670	684
Selling, general and administrative	8,597	5,038	15,321	8,505
Loss from operations	(5,880)	(5,329)	(10,193)	(9,201)
Interest income	(277)	(112)	(384)	(167)
Loss on disposal of assets	1		1	243
Other (income) loss	(1)	(505)	4	(529)
Foreign exchange loss (gain)	52	(1)	56
Loss before income taxes	(5,655)	(4,711)	(9,870)	(8,748)
Income tax benefit	(382)		(660)
Net loss	(5,273)	(4,711)	(9,210)	(8,748)
Change in foreign currency translation	40		(11)
Net loss and comprehensive loss	$ (5,313)	$ (4,711)	$ (9,199)	$ (8,748)
Weighted average number of common shares - basic (in shares)	979,899,668	973,656,518	979,899,668	932,959,287
Weighted average number of common shares - diluted (in shares)	979,899,668	973,656,518	979,899,668	932,959,287
Loss per share - basic (in dollars per share)	$ (0.005)	$ (0.005)	$ (0.009)	$ (0.044)
Loss per share - diluted (in dollars per share)	$ (0.005)	$ (0.005)	$ (0.009)	$ (0.044)

XML

Consolidated statements of shareholders' equity - USD ($) $ in Thousands	Common Stock	Common Stock Subscribed	Additional Paid-In Capital	Retained Earnings (Accumulated Deficit)	Accumulated other comprehensive loss	Total
Balance ( in shares) at Dec. 31, 2020	642,036,228
Balance, amount at Dec. 31, 2020	$ 104,784	$ 460	$ 14,792	$ (68,969)		$ 51,067
Stock issuance for financing	$ 199,525					199,525
Stock issuance for financing (in shares)	105,013,158
Stock issuance costs	$ (14,281)					(14,281)
Stock-based compensation			3,065			3,065
Net loss				(8,748)		(8,748)
Stock issuance from warrant exercises	$ 44,082	$ (460)	(11,511)			32,111
Stock issuance from warrant exercises (in shares)	200,951,905
Stock issued due to exercise of stock options	$ 2,112		(744)			1,368
Stock issued due to exercise of stock options (in shares)	5,230,601
Stock redemption	$ 44,000			(32,039)		11,961
Stock redemption (in shares)	24,719,101
Balance, (in shares) at Jun. 30, 2021	977,950,993
Balance, amount at Jun. 30, 2021	$ 380,222		5,602	(109,756)		276,068
Balance ( in shares) at Mar. 31, 2021	972,092,308
Balance, amount at Mar. 31, 2021	$ 377,971		4,602	(105,045)		277,528
Stock issuance costs	0					0
Stock-based compensation			1,782			1,782
Net loss				(4,711)		(4,711)
Stock issuance from warrant exercises	$ 139		(38)			101
Stock issuance from warrant exercises (in shares)	628,084
Stock issued due to exercise of stock options	$ 2,112		(744)			1,368
Stock issued due to exercise of stock options (in shares)	5,230,601
Balance, (in shares) at Jun. 30, 2021	977,950,993
Balance, amount at Jun. 30, 2021	$ 380,222		5,602	(109,756)		276,068
Balance ( in shares) at Dec. 31, 2021	979,899,668
Balance, amount at Dec. 31, 2021	$ 380,962		9,313	(119,391)	$ 2	270,886
Stock-based compensation			4,533			4,533
Net loss				(9,210)		(9,210)
Other comprehensive income					11	11
Balance, (in shares) at Jun. 30, 2022	979,899,668
Balance, amount at Jun. 30, 2022	$ 380,962		13,846	(128,601)	13	266,220
Balance ( in shares) at Mar. 31, 2022	979,899,668
Balance, amount at Mar. 31, 2022	$ 380,962		11,354	(123,328)	53	269,041
Stock-based compensation			2,492			2,492
Net loss				(5,273)		(5,273)
Other comprehensive income					(40)	(40)
Balance, (in shares) at Jun. 30, 2022	979,899,668
Balance, amount at Jun. 30, 2022	$ 380,962		$ 13,846	$ (128,601)	$ 13	$ 266,220

XML

Condensed consolidated statements of cash flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Cash flows from operating activities:
Net loss	$ (9,210)	$ (8,748)
Adjustments for
Depreciation	161	115
Amortization - intangible assets	1,495	89
Loss on sale of property and equipment	1	243
Loss on other assets	0	5
(Gain) loss on right-of-use assets	0	(533)
Stock-based compensation	4,533	3,065
Non cash portion of rent expense	9	35
Change in non-cash operating working capital
Purchased inventory	(2,572)	(794)
Prepaid expenses and deposits	(410)	437
Trade receivables	(96)	(4)
Other receivables	131	(133)
Accounts payable and accrued liabilities	292	1,847
Accrued income tax	(199)	0
Deferred tax liabilities	(661)	0
Other current liabilities	4	0
Customer contract liabilities	(25)	0
Other liabilities	30	0
Net cash used in operating activities	(6,517)	(4,376)
Cash flows from investing activities:
Investment in debt security (at fair value)	(1,000)	0
Investment in property and equipment	(151)	(43)
Investment in intangibles	0	(99)
Investment in assets in process	(492)	0
Net cash used in investing activities	(1,643)	(142)
Cash flows from financing activities:
Cash proceeds from issuance of common shares and warrants	0	199,525
Cash received from warrant exercises	0	32,112
Cash paid for shares and warrant issuance costs	0	(14,269)
Cash received from stock option exercises	0	1,368
Net cash provided by financing activities	0	218,736
(Decrease) increase in cash and cash equivalents	(8,160)	214,218
Effect of exchange rate changes on cash	(29)	0
Cash and cash equivalents, beginning of year	194,952	61,992
Cash and cash equivalents, end of year	186,763	276,210
Noncash investing and financing activities
Transfer of inventory into property and equipment	557	0
Supplemental cash flow information:
Interest received	$ (384)	$ (112)

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Nature of Operations

6 Months Ended

Jun. 30, 2022

Nature of Operations

Nature of operation

1. Nature of operations

The Company is a veterinary health company creating point-of-care diagnostics and therapeutics products for dogs and cats, that focuses on the needs of the veterinarians themselves. The Company consists of the parent company, Zomedica Corp, its wholly-owned U.S subsidiary, Zomedica Inc., and Pulse Veterinary Technologies LLC, along with its international subsidiaries.

The impact of the novel strain of coronavirus (“COVID-19”)

There remains a significant amount of stress and uncertainty across national and global economies due to the pandemic of coronavirus disease 2019 (“COVID-19”) caused by severe acute respiratory syndrome coronavirus 2 (the “COVID-19 pandemic”). The continued presence of COVID-19 has resulted in changes in the macro-economic environment including disruptions in supply chain, labor disruptions, an inability to manufacture, an inability to sell to customers, declines in customer demand, and an impaired ability to access credit and capital markets, among other things.

The COVID-19 pandemic materially and adversely affected the development and commercialization of our TRUFORMA® platform and the initial five assays. In response to the pandemic, our development partner had reduced the number of employees working in its facilities for a period of time which has delayed the completion of the verification of the five initial TRUFORMA® assays and the manufacturing of commercial quantities of the TRUFORMA® platform and the related assays. Veterinary hospitals and clinics that had agreed to participate in the validation of our initial TRUFORMA® assays either shut down for a period of time or limited their operations to those involving only life-threatening conditions, which we have mitigated to a certain extent with our recent ability to successfully complete remote installations. Potential customers have at times restricted access to their facilities which has affected and may continue to affect our ability to perform on-site demonstrations and other marketing activities. The extent to which the COVID-19 pandemic may impact our business will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the duration of the outbreak, the spread and severity of COVID-19, and the effectiveness of governmental actions in response to the pandemic.

The emergence of new variants has not caused significant modification to business operations.  We continue to install remotely, if potential customers restrict access to their facilities.  We intend to continue development of new assays, both for equine indications of our current and planned assays, and for various additional disease states affecting canine, feline, and equine patients in the future.  

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Basis of Preparation

6 Months Ended

Jun. 30, 2022

Basis of preparation

Basis of preparation

2. Basis of preparation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for the presentation of interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited financial statements do not include all the information and footnotes necessary for a comprehensive presentation of the financial position, results of operations and cash flows for the periods presented. In the opinion of management, the unaudited financial statements include all the normal recurring adjustments that are necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2022. These unaudited financial statements should be read in combination with the other Notes in this section; “Management’s Discussion and Analysis of Financial Condition and Results of Operations” appearing in Item 2; and the Consolidated Financial Statements, including the Notes to the Consolidated Financial Statements, included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. The Consolidated Balance Sheet as of December 31, 2021 was derived from audited financial statements.

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2022

Significant Accounting Policies

Significant Accounting Policies

3. Significant accounting policies

Estimates and assumptions

In preparing these financial statements, management was required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates and assumptions are based on our historical experience, the terms of existing contracts, our evaluation of trends in the industry, information provided by our customers and suppliers and information available from other outside sources, as appropriate. These estimates and assumptions are subject to an inherent degree of uncertainty. We are not presently aware of any events or circumstances that would require us to update such estimates and assumptions or revise the carrying value of our assets or liabilities. Our estimates may change, however, as new events occur, and additional information is

obtained. As a result, actual results may differ significantly from our estimates, and any such differences may be material to our financial statements.

Inventories

Inventories are stated at the lower of cost or net realizable value. The Company utilizes the specific identification and First in, First out (“FIFO”) methods to track inventory costs. The Company records reserves, when necessary, to reduce the carrying value of inventory to its net realizable value. Management considers forecast demand in relation to the inventory on hand, competitiveness of product offerings, market conditions and product life cycles when determining excess and obsolescence and net realizable value adjustments. At the point of loss recognition, a new, lower-cost basis for that inventory is established, and any subsequent improvements in facts and circumstances do not result in the restoration or increase in that newly established cost basis.

Intangible assets

Expenditures related to the planning and operation of the Company’s website are expensed as incurred. Expenditures related to the website application and infrastructure development are capitalized and amortized over the website’s estimated useful life.

Costs related to acquired trademarks, tradename, customer relationships and developed technology have been capitalized and amortized over the estimated useful life.

Revenue recognition and liabilities due to customers

The Company enters into agreements which may contain multiple promises where customers purchase products, services or a combination thereof. Determining whether products and services are considered distinct performance obligations that should be accounted for separately requires judgment. We determine the transaction price for a contract based on the total consideration we expect to receive in exchange for the transferred goods or services.

The Company allocates revenue to each performance obligation in proportion to the relative standalone selling prices and recognizes revenue when control of the related goods or services is transferred for each obligation. We utilize the observable standalone selling price when available, which represents the price charged for the performance obligation when sold separately.

The Company's contracts with customers are generally comprised of purchase orders for the sale of the point of care instrument, consumable products, and extended warranties, or some variation thereof. The instrument and consumables each represent a single performance obligation when sold separately, that is satisfied at a point in time upon transfer of control of the product to the customer which is typically upon receipt of the goods by the customer. The extended warranties are also a separate performance obligation, whereby revenue is recognized over time.

The nature of the Company’s business gives rise to variable consideration, including discounts and applicator (“trode”) returns. Credits are issued for unused shocks on returned trodes, which can be used toward the purchase of replacement trodes. Discounts and the estimated unused shock credits decrease the transaction price, which reduces revenue. Variable consideration related to unused shock credits is estimated using the expected value method, which estimates the amount that is expected to be earned. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Estimates of variable consideration are estimated based upon historical experience and known trends. These estimated credits are nonrefundable and may only be used towards the purchase of future trode refurbishments. This practice encourages refurbishment purchase prior to complete utilization of the previous trode, so the customer will always have a trode at hand with ample capacity to perform treatments.

At times the Company receives consideration prior to when the performance obligation is completed, giving rise to a contract liability.  

Sales are recorded net of sales tax. Sales tax is charged on sales to end users and remitted to the appropriate state authority.

Accounts receivable are recorded at net realizable value and have payment terms of 30 days.  The Company recorded an allowance for doubtful accounts of $36 and $34, as of June 30, 2022 and December 31, 2021, respectively, which is recorded net in trade receivables.

The diagnostic segment reported $92 in revenue from consumables for the three months ended June 30, 2022, compared to $16 for the three months ended June 30, 2021, an increase of $76 or 475%. The therapeutics segment reported $4,154 in total revenue for the three months ended June 30, 2022, compared to $0 for the three months ended June 30, 2021. Therapeutics revenue for the three months ended June 30, 2002 was comprised of $2,308 in revenue from trodes, $1,543 in revenue from instruments, and $303 in other revenues which includes warranty and repair work.

The diagnostic segment reported $148 in revenue from consumables for the six months ended June 30, 2022, compared to $30 for the six months ended June 30, 2021, an increase of $118 or 393%. The therapeutics segment reported $7,849 in total revenue for the six months ended June 30, 2022, compared to $0 for the six months ended June 30, 2021. Therapeutics revenue for the six months ended June 30, 2002 was comprised of $4,226 in revenue from trodes, $3,102 in revenue from instruments, and $520 in other revenues which includes warranty and repair work.

Cost of revenue

Cost of revenue consists of materials, and shipping costs incurred internally to produce and receive the products. Shipping and handling costs incurred by the Company are included in cost of revenue.

Comparative figures  

Assets in process are separately stated in the current period balance sheet for $523.  The consolidated balance sheets for the year ended December 31, 2021 have been adjusted for $420 of assets in process that were included in intangible assets and property and equipment.  This amount has been reclassified to a separate line in the balance sheet to conform to the current year presentation. The change in presentation had no effect on the reported results of operations. These changes in classification do not affect previously reported cash flows from operating activities in the consolidated statements of cash flows.

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Business Combination

6 Months Ended

Jun. 30, 2022

Business Combination

Business Combination

4. Business Combinations

Acquisition of PulseVet

On October 1, 2021, Zomedica Inc., a wholly-owned subsidiary of Zomedica Corp. (the “Company”), entered into a Stock Purchase Agreement with Branford PVT Mid-Hold, LLC pursuant to which Zomedica Inc. acquired 100% of the capital stock of Branford PVT Acquiror, Inc., a Delaware corporation (“BPA”). BPA is a holding company whose direct and indirect wholly-owned subsidiaries include Pulse Veterinary Technologies, LLC (“PulseVet”), which, together with its consolidated subsidiaries, is a leading provider of non-invasive shock wave therapy treatment devices to the veterinary industry (the “Acquisition”). The purchase price for the Acquisition was $71,929 in cash.

As a result of total consideration exceeding the preliminary fair value of the net assets acquired, goodwill in the amount of $43,288 was recorded in connection with this acquisition, none of which will be deductible for U.S tax purposes. The goodwill largely results from our ability to market and sell the PulseVet Technology through our established customer base.

The following table summarizes the preliminary acquisition date fair values of the assets acquired and liabilities assumed and subsequent initial period adjustments:

	Initial		Measurement
	allocation of		period		Updated
	consideration		adjustments		allocation
Cash and cash equivalents	$	526	$	3	$	529
Inventory		840		31		871
Prepaid expenses and deposits		365		—		365
Trade receivables		269		—		269
Other receivables		—		150		150
Property and equipment		125		—		125
Intangible Assets (estimated useful life)		—		—		—
Developed technology (15 years)		8,650		—		8,650
Trade name (19 years)		2,350		—		2,350
Customer relationships (11 years)		22,650		—		22,650
Other Assets		69		265		334
Total assets acquired		35,844		449		36,293
Accounts payable and accrued liabilities		1,112		(543)		569
Income tax payable		44		—		44
Deferred revenue		61		—		61
Liability for contracts with customers		332		—		332
Deferred tax liabilities		7,138		(900)		6,238
Other non current liabilities		143		265		408
Total liabilities assumed		8,830		(1,178)		7,652
Net assets acquired, excluding goodwill		27,014		1,627		28,641
Goodwill		44,915		(1,627)		43,288
Net assets acquired	$	71,929	$	—	$	71,929

During the period subsequent to the acquisition of PulseVet, we made certain preliminary measurement period adjustments to the acquired assets and liabilities assumed. The determination of the final purchase price allocation to specific assets and liabilities assumed is incomplete. The purchase price allocation may change in future periods as the fair value estimates of the deferred tax assets and liabilities are adjusted.  

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Inventory

6 Months Ended

Jun. 30, 2022

Inventory

Inventory

5. Inventory

Inventory details are as follows:

	June 30, 2022						December 31, 2021
	Diagnostics		Therapeutics		Consolidated		Diagnostics		Therapeutics		Consolidated
Raw Materials	$	—	$	1,300	$	1,300	$	—	$	890	$	890
Finished Goods		—		323		323		—		140		140
Purchased Inventory		3,234		—		3,234		1,848		—		1,848
Total		3,234		1,623		4,857		1,848		1,030		2,878
Reserves		(16)		(22)		(38)		(9)		(21)		(30)
Inventory, Net	$	3,218	$	1,601	$	4,819	$	1,839	$	1,009	$	2,848

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Prepaid expenses, deposits and deferred financing costs

6 Months Ended

Jun. 30, 2022

Prepaid expenses, deposits and deferred financing costs

Prepaid expenses, deposits and deferred financing costs

6. Prepaid expenses, deposits and deferred financing costs

	June 30,		December 31,
	2022		2021
Deposits	$	1,966	$	1,340
Prepaid marketing		144		83
Prepaid insurance		272		599
Other		264		214
Total	$	2,646	$	2,236

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Property and Equipment

6 Months Ended

Jun. 30, 2022

Property and Equipment

Property and equipment

7. Property and equipment

	June 30,		December 31,
	2022		2021
Machinery and office equipment	$	2,098	$	1,392
Furniture and equipment		106		110
Laboratory equipment		230		225
Leasehold improvements		287		287
		2,721		2,014
Accumulated depreciation and amortization		1,011		884
Net property and equipment	$	1,710	$	1,130

Depreciation expense for the three months ended June 30, 2022 and June 30, 2021 was $71 and $55, respectively and for the six months ended June 30, 2022 and June 30, 2021 was $161 and $115, respectively.

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Intangible Assets

6 Months Ended

Jun. 30, 2022

Intangible Assets

Intangible Assets

8. Intangible assets

	June 30,		December 31,
	2022		2021
Computer software	$	28	$	28
Trademarks		16		16
Website		962		546
Tradename		2,350		2,350
Customer relationships		22,650		22,650
Technology		8,650		8,650
		34,656		34,240
Accumulated amortization		2,559		1,064
Net intangibles	$	32,097	$	33,176

The estimated future amortization of intangible assets is as follows:

2022 Remainder	$	1,542
2023		2,912
2024		2,906
2025		2,809
2026 and beyond		21,928
Total	$	32,097

Amortization expense for the three months ended June 30, 2022 and June 30, 2021 was $759 and $45, respectively and for the six months ended June 30, 2022 and 2021 was $1,495 and $89, respectively.

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Debt security (at fair value)

6 Months Ended

Jun. 30, 2022

Debt security (at fair value)

Debt security (at fair value)

9. Debt security (at fair value)

On May 16, 2022, Zomedica Inc. purchased a $1.0 million convertible note from Structured Monitoring Products, Inc. (“SMP”), and in connection with the note has acquired the option to act as a sales agent for SMP's platform. The note, which provides for 8% interest and is due to be repaid in May of 2024, is convertible into equity securities of the Company upon the occurrence of certain events. Under the terms of the agreement, Zomedica Inc. will also have the option to acquire SMP’s VetGuardian product line for use in animal health. Exercise of both options is subject to certain conditions, including negotiation and execution of mutually acceptable agreements.

As of June 30, 2022, the fair value of our debt security investment was as follows:

	June 30, 2022
Debt security (at fair value)	$	1,000,000
Interest receivable		9,863
		1,009,863
Allowance for doubtful accounts		-
Debt security (at fair value), net	$	1,009,863

The investment in the convertible note was recorded at its fair value of $1,000,000 as of June 30, 2022 (with an amortized cost basis of $1,000,000). There were no unrealized gains or losses recorded and no other than temporary impairments recognized as of June 30, 2022.

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Leases

6 Months Ended

Jun. 30, 2021

Leases

Leases

10. Leases

On February 1, 2021 the Company downsized its office space and modified its existing lease with Wickfield Phoenix LLC. The new lease period was for 48 months, commencing on February 1, 2021 and ending on January 31, 2025 with a monthly rent payment of $12 for the first two months and escalating to $31 over the lease period. The carrying value of the right of use asset was $1,258 upon modification using the Company's incremental borrowing rate of 3.95%. During the period ending March 31, 2021 the Company recorded a gain on right-of-use asset of $24 in the consolidated statements of comprehensive loss.

On September 15, 2021, the Company entered into an additional lease with Wickfield Phoenix LLC for warehousing space. The new lease period is for 41 months, commencing on September 15, 2021, and ending on January 31, 2025, with a monthly rent payment of $5 for the first month and escalating to $10 over the lease period. The Company recorded a right-of-use asset and corresponding lease liability for $366 using the Company's incremental borrowing rate of 3.95%.

On April 1, 2022, the Company entered into an agreement with ULF Northfield Business Center LLC to lease 12,400 square feet of office and warehouse space.  The lease period is for 61 months beginning on April 1, 2022, with a monthly rent payment of $9 for the first twelve months and escalating to $11 per month over the lease period. The Company recorded a right-of-use asset and corresponding lease liability for $546 using the Company's incremental borrowing rate of 3.95%.

During the three and six months ended June 30, 2022, the Company recognized $179 and $331 in rent expense inclusive of common area maintenance (CAM) charges, insurance, and tax with $18 and $34 recorded in research and development expenses and $161 and $297 recorded in general and administrative expense in the consolidated statements of comprehensive loss.

During the three and six months ended June 30, 2021, the Company recognized $85 and $176 in rent expense inclusive of common area maintenance (CAM) charges, insurance, and tax with $17 and $38 recorded in research and development expenses and $68 and $138 recorded in general and administrative expense in the consolidated statements of comprehensive loss.

	June 30,		December 31,
	2022		2021
Right-of-use asset
Cost
Aggregate lease commitments	$	2,385	$	1,779
Less: impact of present value		(215)		(155)
Balance	$	2,170	$	1,624
Reduction in right-of-use asset
Straight line amortization		605		346
Interest		(73)		(42)
Balance	$	532	$	304
Net book value as at:
Balance	$	1,638	$	1,320
Lease liabilities
Additions	$	2,193	$	1,647
Payments		(559)		(310)
Interest		73		42
Total lease liabilities	$	1,707	$	1,379
Current portion of lease liabilities		523		415
Long term portion of lease liabilities		1,184		964
Total lease liabilities	$	1,707	$	1,379

Total remaining undiscounted lease liabilities related to the above lease are as follows:

2022 Remainder	$	287
2023		590
2024		609
2025		165
2026		129
2027		44
Total	$	1,824

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Stock-based compensation

6 Months Ended

Jun. 30, 2022

Stock-based compensation

Stock-based compensation

11. Stock-based compensation

During the three and six months ended June 30, 2022, the Company issued 6,575,000 and 21,000,000 stock options to purchase an aggregate of 6,575,000 and 21,000,000 common shares. The options vest over a period of four years and have an expiration period of ten years.  During the three and six months ended June 30, 2021, the Company issued 7,800,000 and 9,200,000 stock options to purchase an aggregate of 7,800,000 and 9,200,000 common shares, respectively. The options vest over a period of four years and have an expiration period of 10 years.

The continuity of stock options are as follows:

	Number of	Weighted Avg
	Options	Exercise Price
Balance at December 31, 2021	50,717,724	$	0.45
Stock options granted	21,000,000		0.32
Stock options exercised	—		—
Stock options forfeited	1,250,000		0.67
Vested stock options expired	8,960,000		0.22
Balance at June 30, 2022	61,507,724	$	0.43
Vested at June 30, 2022	15,596,349	$	0.36

As of June 30, 2022, details of the issued and outstanding stock options were as follows:

				Number of	Weighted avg
		Number of options	Number of	unvested	remaining life
		issued	vested options	options	outstanding
Grant date	Exercise price	and outstanding	outstanding	outstanding	(years)
March 14, 2020	0.19	1,283,557	949,682	333,875	2.71
July 9, 2020	0.18	175,000	87,500	87,500	3.03
August 25, 2020	0.13	20,000	—	20,000	3.16
October 1, 2020	0.11	266,667	116,667	150,000	3.26
October 20, 2020	0.09	20,000	10,000	10,000	3.31
December 31, 2020	0.23	16,442,500	8,807,500	7,635,000	3.51
February 26, 2021	1.87	500,000	300,000	200,000	3.66
March 1, 2021	2.06	200,000	100,000	100,000	3.67
March 8, 2021	1.88	200,000	100,000	100,000	3.69
March 15, 2021	2.49	200,000	100,000	100,000	3.71
May 12, 2021	0.78	3,450,000	900,000	2,550,000	3.87
May 14, 2021	0.75	3,200,000	850,000	2,350,000	3.87
August 11, 2021	0.57	1,100,000	175,000	925,000	4.12
August 18, 2021	0.50	200,000	—	200,000	4.14
August 23, 2021	0.50	100,000	—	100,000	4.15
September 13, 2021	0.57	800,000	—	800,000	4.21
October 1, 2021	0.58	12,650,000	—	12,650,000	4.26
January 3, 2022	0.36	100,000	—	100,000	4.52
January 4, 2022	0.35	200,000	—	200,000	4.52
January 14, 2022	0.35	200,000	—	200,000	4.55
January 16, 2022	0.35	325,000	—	325,000	4.55
January 18, 2022	0.35	100,000	—	100,000	4.56
February 14, 2022	0.30	400,000	—	400,000	4.63
February 21, 2022	0.37	200,000	—	200,000	4.65
February 25, 2022	0.35	12,400,000	—	12,400,000	4.66
March 30, 2022	0.35	200,000	—	200,000	4.75
April 1, 2022	0.34	200,000	—	200,000	4.76
April 6, 2022	0.32	100,000	—	100,000	4.77
April 7, 2022	0.31	200,000	—	200,000	4.77
April 11, 2022	0.31	75,000	—	75,000	4.78
May 2, 2022	0.25	300,000	—	300,000	4.84
May 9, 2022	0.21	700,000	—	700,000	4.86
May 11, 2022	0.20	400,000	—	400,000	4.87
May 16, 2022	0.23	100,000	—	100,000	4.88
May 31, 2022	0.24	500,000	—	500,000	4.92
June 1, 2022	0.25	500,000	—	500,000	4.92
June 6, 2022	0.26	200,000	—	200,000	4.94
June 13, 2022	0.24	200,000	—	200,000	4.96
June 17, 2022	0.24	3,100,000	3,100,000	—	4.97
Balance at June 30, 2022		61,507,724	15,596,349	45,911,375

The Company calculates volatility of stock-based compensation using the historical price of the Company’s stock. An increase/decrease in the volatility would have resulted in an increase/decrease in the fair value of the options.

The fair value of options granted during the six months ended June 30, 2022 and the twelve months ended December 31, 2021 was estimated using the Black-Scholes option pricing model to determine the fair value of options granted using the following assumptions:

	February 26,			March 1,			March 8,
	2021			2021			2021
Volatility		117	%		117	%		117	%
Risk-free interest rate		0.95	%		0.92	%		1.07	%
Expected life (in years)		10			10			10
Dividend yield		0	%		0	%		0	%
Common share price	$	1.87		$	2.06		$	1.88
Strike price	$	1.87		$	2.06		$	1.88
Forfeiture rate		0	%		0	%		0	%

	May 12,			August 11,			August 23,
	2021			2021			2021
Volatility		118	%		116	%		116	%
Risk-free interest rate		1.11	%		0.96	%		0.92	%
Expected life (in years)		6.21-6.22			6.18-6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.78		$	0.56		$	0.50
Strike price	$	0.78		$	0.57		$	0.50
Forfeiture rate		0	%		0	%		0	%

	September 27,			October 1,
	2021			2021
Volatility		116	%		116	%
Risk-free interest rate		1.14	%		1.10	%
Expected life (in years)		6.25			6.25
Dividend yield		0	%		0	%
Common share price	$	0.54		$	0.57
Strike price	$	0.54		$	0.58
Forfeiture rate		0	%		0	%

	January 3,			January 4,			January 14,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		1.50	%		1.47	%		1.64	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.36		$	0.35		$	0.35
Strike price	$	0.36		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%
	January 16,			January 18,			February 14,
	2022			2022			2022
Volatility		114	%		114	%		113	%
Risk-free interest rate		1.73	%		1.74	%		1.94	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.35		$	0.35		$	0.29
Strike price	$	0.35		$	0.35		$	0.30
Forfeiture rate		0	%		0	%		0	%
	February 21,			February 25,			March 30,
	2022			2022			2022
Volatility		113	%		113	%		114	%
Risk-free interest rate		1.89	%		1.91	%		2.43	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.37		$	0.35		$	0.35
Strike price	$	0.37		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%

	April 1,			April 6,			April 7,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		2.53	%		2.70	%		2.72	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.33		$	0.32		$	0.31
Strike price	$	0.34		$	0.32		$	0.31
Forfeiture rate		0	%		0	%		0	%
	April 11,			May 2,			May 9,
	2022			2022			2022
Volatility		114	%		113	%		113	%
Risk-free interest rate		2.82	%		3.03	%		3.00	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.30		$	0.25		$	0.21
Strike price	$	0.31		$	0.25		$	0.21
Forfeiture rate		0	%		0	%		0	%
	May 11,			May 16,			May 31,
	2022			2022			2022
Volatility		113	%		113	%		113	%
Risk-free interest rate		2.92	%		2.86	%		2.84	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.20		$	0.22		$	0.23
Strike price	$	0.20		$	0.23		$	0.24
Forfeiture rate		0	%		0	%		0	%

	June 1,			June 6,			June 13,
	2022			2022			2022
Volatility		113	%		113	%		112	%
Risk-free interest rate		2.96	%		3.05	%		3.55	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.25		$	0.26		$	0.24
Strike price	$	0.25		$	0.26		$	0.24
Forfeiture rate		0	%		0	%		0	%
	June 17,			June 17,			June 17,
	2022			2022			2022
Volatility		112	%		112	%		112	%
Risk-free interest rate		3.02	%		3.02	%		3.35	%
Expected life (in years)		1.37			1.64			4.27
Dividend yield		0	%		0	%		0	%
Common share price	$	0.24		$	0.24		$	0.24
Strike price	$	0.24		$	0.24		$	0.24
Forfeiture rate		0	%		0	%		0	%

The Company recorded $2,492 and $4,533 of stock-based compensation for the three and six months ended June 30, 2022, respectively. For the three and six months ended June 30, 2021, the Company recorded $1,782 and $3,065, respectively.

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Warrants

6 Months Ended

Jun. 30, 2022

Warrants

Warrants

12. Warrants

The Company values warrants issued in equity placements using the Black Scholes model to allocate the fair value of the proceeds from equity financings using a relative fair value approach. Like other stock-based compensation, management uses judgment to determine the inputs to the Black-Scholes option pricing model including the expected life, and underlying share price volatility. Changes in these assumptions will impact the calculation of fair value and the value attributed to the warrants.  The Company calculates volatility of warrants based on the historical price of the Company’s stock. An increase/decrease in the volatility would have resulted in an increase/decrease in the fair value of the options.

In connection with the February 14, 2020 registered direct offering, the Company issued 20,833,334 five and one half-year Series A warrants to purchase 20,833,334 shares of common stock at an exercise price of $0.20. The Company also issued 1,041,667 warrants to purchase 1,041,667 shares of common stock at an exercise price of $0.15 per share to the placement agents.

In connection with the April 9, 2020 CMPO, the Company issued 16,666,667 five-year Series B Warrants to purchase 16,666,667 common shares at an exercise price of $0.15. The Company also issued 1,666,667 Placement Agent Warrants to purchase 1,666,667 common shares at an exercise price of $0.15 per share.

In connection with the May 29, 2020 public offering, the Company issued 133,333,333 two-year Series C Warrants to purchase 133,333,333 common shares at an exercise price of $0.15. The Company also issued 12,170,000 Series C Pre-Funded Warrants to purchase common shares at an exercise price of $0.0001 on a cashless exercise basis. As of December 31, 2020, all of the Series C Pre-Funded warrants had been exercised.

In connection with the July 7, 2020 public offering, the Company issued 187,500,000 two-year Series D Warrants to purchase 187,500,000 common shares at an exercise price of $0.16. The Company also issued 25,000,000 Series D Pre-Funded Warrants to purchase common shares at an exercise price of $0.0001 on a cashless exercise basis. As of December 31, 2020, all of the Series D Pre-Funded Warrants had been exercised.

As at June 30, 2022, details of the outstanding warrants were as follows:

			Weighted
			Average
	Exercise	Warrants	Remaining
Original Issue date	Price	Outstanding	Life
February 14, 2020	0.15	197,917	2.62
April 9, 2020	0.15	363,501	2.78
May 29, 2020	0.15	-	-
July 7, 2020	0.16	231,000	0.02
Balance at June 30, 2022		792,418

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Income taxes

6 Months Ended

Jun. 30, 2022

Income taxes

Income taxes

13. Income taxes

The Company is in an overall net deferred tax liability position as of June 30, 2022.  Management has assessed that the future taxable income resulting from the deferred tax liability position will result in utilization of the Company’s US federal and state net operating loss carryforwards in future tax periods.  The Company is in a net deferred tax asset position in Canada and a full valuation allowance against the Canada deferred tax assets remains necessary as a result of the historical losses and the uncertainty of realizing any future tax benefits related to the Canadian deferred tax assets.

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Commitments and contingencies

6 Months Ended

Jun. 30, 2022

Commitments and contingencies

Commitments and contingencies

14. Commitments and contingencies

On May 10, 2018, the Company entered into a Development, Commercialization and Exclusive Distribution Agreement. As part of the agreement, the Company is required to make the following future milestone payments:

● 1st payment: $3,500 in cash payment upon the achievement of future development milestones

● 2nd payment: $3,500 in equity, determined by dividing the amount due by the volume-weighted average price of the Company’s common stock on the NYSE American exchange over the 10 trading days prior to the achievement of the milestone event.

As of June 30, 2022, none of the future development milestones related to the above agreement have been met. The Company has assessed the probability of meeting the above milestones and has determined that an accrual is not necessary as of June 30, 2022 and December 31, 2021.

From time to time, the Company may be exposed to claims and legal actions in the normal course of business. The Company is not aware of any pending or threatened material litigation claims against the Company.

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Segment information

6 Months Ended

Jun. 30, 2022

Segment information

Segment Information

15. Segment information

The Company’s operations are comprised of two reportable segments. Although the reportable segments provide similar products, each one is managed separately to better align with the Company’s customers and distribution or development partners.

In addition, all of the Company’s long-lived assets are in the United States of America (“US”).

	Diagnostics		Therapeutics		Consolidated
Net Revenue	$	148	$	7,849	$	7,997
Operating (loss) income		(12,481)		2,288		(10,193)
Interest income		384		-		384
(Loss) income before income taxes	$	(12,108)	$	2,238	$	(9,870)
Total assets	$	195,130	$	80,348	$	275,478
Depreciation and amortization		241		1,415		1,656
Capital expenditures	$	643	$	-	$	643

		June 30,		December 31,
		2022		2021
Non-US	$	5,891	$	171,641
US		269,587		108,759
Total assets	$	275,478	$	280,400
Total US property and equipment	$	2,233	$	1,550
Total US right-of-use asset	$	1,638	$	1,320

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Loss per share

6 Months Ended

Jun. 30, 2022

Loss per share

Loss per share

16. Loss per share

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Numerator
Net loss for the period	$	(5,273)	$	(4,711)	$	(9,210)	$	(8,748)
Charge to retained earnings for preferred share exchange		-		-		-		(32,039)
Loss attributable to common shareholders		(5,273)		(4,711)		(9,210)		(40,787)
Denominator
Weighted average shares - basic		979,899,668		973,656,518		979,899,668		932,959,287
Stock options		—		—		—		—
Warrants		—		—		—		—
Denominator for diluted loss per share		979,899,668		973,656,518		979,899,668		932,959,287
Loss per share - basic and diluted	$	(0.005)	$	(0.005)	$	(0.009)	$	(0.044)

For the above-mentioned periods, the Company had 61,507,724 stock options and 792,418 warrants outstanding which could potentially dilute basic earnings per share in the future but were excluded from the computation of diluted loss per share in the periods presented, as their effect would have been anti-dilutive.

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Related party transaction

6 Months Ended

Jun. 30, 2022

Related party transaction

Related party transaction

17. Related party transaction

On March 1, 2022 we entered into a Consulting Agreement with Johnny Powers, a member of our Board. Pursuant to the Powers Agreement, Dr. Powers provides strategic consulting services to the Company. Dr. Powers is entitled to $10 per month as compensation and reimbursement for authorized expenses.  The Powers Agreement expires November 30, 2022.

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Subsequent events

6 Months Ended

Jun. 30, 2022

Subsequent events

Subsequent events

18. Subsequent events

On July 1, 2022, Zomedica Inc., the wholly-owned subsidiary of Zomedica Corp., purchased the assets of Revo Squared for a base purchase price of $6,000 in cash, which was subject to adjustments based on the amount of Revo Squared’s working capital at closing. $500 of the purchase price was deposited into a third-party escrow account for a period of 15 months to support Revo Squared’s indemnification obligation under the Asset Purchase Agreement and an additional $5 of the purchase price was deposited into the escrow account for a period of approximately 90 days to support payment of post-closing adjustments to the purchase price, if any. The Company also issued to Revo Squared a ten-year warrant to purchase an aggregate of 10,000,000 of the Company’s common shares at a per share exercise price equal to $0.2201. Zomedica Inc. has agreed to pay Revo Squared aggregate earn-out payments of up to $4,000 based on the achievement of milestones related to future net sales from Revo Squared Products. One-time earn-out payments of $2,000 each will be payable upon net sales from Revo Squared Products exceeding $5,000 and $10,000 during any calendar year ending on or prior to December 31, 2027.

On July 15, 2022, Zomedica Corp. and its wholly-owned subsidiary Zomedica Inc. entered into an Asset Purchase Agreement with Assisi Animal Health LLC, its wholly-owned subsidiary, AAH Holdings LLC, and certain of Assisi’s members pursuant to which Zomedica Inc. agreed to acquire substantially all of the assets of the Sellers. The Sellers are in the business of developing, manufacturing, marketing, distributing and selling animal health products which use targeted Pulsed Electromagnetic Field (PEMF) therapy to decrease pain and inflammation, accelerate healing, and reduce anxiety that include the Assisi Loop®, Assisi Loop Lounge®, Assisi DentaLoop® and Calmer Canine® product lines. The Acquisition was consummated on the Effective Date. At the closing, Zomedica Inc. paid Assisi a purchase price of $18,000 in cash, which was subject to adjustments based on, among other things, the value of Assisi’s inventory and prepaid expenses at the closing of the Acquisition. $1,400 of the purchase price was deposited into a third-party escrow account to support the Selling Parties’ indemnification obligation under the Purchase Agreement, of which $500 and $900 will be distributed to Assisi on the one-year and 18-month anniversary of the Closing Date, respectively, less the amount of prior or pending indemnification claims. An additional $200 of the purchase price was deposited into the escrow account for a period of approximately 90 days to support payment of post-closing adjustments to the purchase price, if any. The Company also issued to Assisi a ten-year warrant to purchase an aggregate of 22,000,000 of the Company’s common shares at a per share exercise price equal to $0.252. The warrants may be exercised on a cash or cashless basis, at the election of the warrant holder.

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2022

Significant Accounting Policies

Estimates and assumptions

Estimates and assumptions

In preparing these financial statements, management was required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates and assumptions are based on our historical experience, the terms of existing contracts, our evaluation of trends in the industry, information provided by our customers and suppliers and information available from other outside sources, as appropriate. These estimates and assumptions are subject to an inherent degree of uncertainty. We are not presently aware of any events or circumstances that would require us to update such estimates and assumptions or revise the carrying value of our assets or liabilities. Our estimates may change, however, as new events occur, and additional information is

obtained. As a result, actual results may differ significantly from our estimates, and any such differences may be material to our financial statements.

Inventories

Inventories

Inventories are stated at the lower of cost or net realizable value. The Company utilizes the specific identification and First in, First out (“FIFO”) methods to track inventory costs. The Company records reserves, when necessary, to reduce the carrying value of inventory to its net realizable value. Management considers forecast demand in relation to the inventory on hand, competitiveness of product offerings, market conditions and product life cycles when determining excess and obsolescence and net realizable value adjustments. At the point of loss recognition, a new, lower-cost basis for that inventory is established, and any subsequent improvements in facts and circumstances do not result in the restoration or increase in that newly established cost basis.

Intangible assets

Intangible assets

Expenditures related to the planning and operation of the Company’s website are expensed as incurred. Expenditures related to the website application and infrastructure development are capitalized and amortized over the website’s estimated useful life.

Costs related to acquired trademarks, tradename, customer relationships and developed technology have been capitalized and amortized over the estimated useful life.

Cost of revenue

Cost of revenue

Cost of revenue consists of materials, and shipping costs incurred internally to produce and receive the products. Shipping and handling costs incurred by the Company are included in cost of revenue.

Comparative figures

Comparative figures  

Assets in process are separately stated in the current period balance sheet for $523.  The consolidated balance sheets for the year ended December 31, 2021 have been adjusted for $420 of assets in process that were included in intangible assets and property and equipment.  This amount has been reclassified to a separate line in the balance sheet to conform to the current year presentation. The change in presentation had no effect on the reported results of operations. These changes in classification do not affect previously reported cash flows from operating activities in the consolidated statements of cash flows.

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Business Combination (Tables)

6 Months Ended

Jun. 30, 2022

Business Combination

Summary of acquisition date fair values

	Initial		Measurement
	allocation of		period		Updated
	consideration		adjustments		allocation
Cash and cash equivalents	$	526	$	3	$	529
Inventory		840		31		871
Prepaid expenses and deposits		365		—		365
Trade receivables		269		—		269
Other receivables		—		150		150
Property and equipment		125		—		125
Intangible Assets (estimated useful life)		—		—		—
Developed technology (15 years)		8,650		—		8,650
Trade name (19 years)		2,350		—		2,350
Customer relationships (11 years)		22,650		—		22,650
Other Assets		69		265		334
Total assets acquired		35,844		449		36,293
Accounts payable and accrued liabilities		1,112		(543)		569
Income tax payable		44		—		44
Deferred revenue		61		—		61
Liability for contracts with customers		332		—		332
Deferred tax liabilities		7,138		(900)		6,238
Other non current liabilities		143		265		408
Total liabilities assumed		8,830		(1,178)		7,652
Net assets acquired, excluding goodwill		27,014		1,627		28,641
Goodwill		44,915		(1,627)		43,288
Net assets acquired	$	71,929	$	—	$	71,929

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Inventory (Tables)

6 Months Ended

Jun. 30, 2022

Inventory

Summary of inventory

	June 30, 2022						December 31, 2021
	Diagnostics		Therapeutics		Consolidated		Diagnostics		Therapeutics		Consolidated
Raw Materials	$	—	$	1,300	$	1,300	$	—	$	890	$	890
Finished Goods		—		323		323		—		140		140
Purchased Inventory		3,234		—		3,234		1,848		—		1,848
Total		3,234		1,623		4,857		1,848		1,030		2,878
Reserves		(16)		(22)		(38)		(9)		(21)		(30)
Inventory, Net	$	3,218	$	1,601	$	4,819	$	1,839	$	1,009	$	2,848

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Prepaid expenses, deposits and deferred financing costs (Tables)

6 Months Ended

Jun. 30, 2022

Prepaid expenses, deposits and deferred financing costs

Schedule of Prepaid Expenses and Deposits

	June 30,		December 31,
	2022		2021
Deposits	$	1,966	$	1,340
Prepaid marketing		144		83
Prepaid insurance		272		599
Other		264		214
Total	$	2,646	$	2,236

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2022

Property and Equipment

Schedule of Property and equipment

	June 30,		December 31,
	2022		2021
Machinery and office equipment	$	2,098	$	1,392
Furniture and equipment		106		110
Laboratory equipment		230		225
Leasehold improvements		287		287
		2,721		2,014
Accumulated depreciation and amortization		1,011		884
Net property and equipment	$	1,710	$	1,130

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Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2022

Intangible Assets

Schedule of Finite-Lived Intangible Assets

	June 30,		December 31,
	2022		2021
Computer software	$	28	$	28
Trademarks		16		16
Website		962		546
Tradename		2,350		2,350
Customer relationships		22,650		22,650
Technology		8,650		8,650
		34,656		34,240
Accumulated amortization		2,559		1,064
Net intangibles	$	32,097	$	33,176

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

2022 Remainder	$	1,542
2023		2,912
2024		2,906
2025		2,809
2026 and beyond		21,928
Total	$	32,097

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Debt security (at fair value) (Tables)

6 Months Ended

Jun. 30, 2022

Debt security (at fair value)

Schedule of debt security at fair value

	June 30, 2022
Debt security (at fair value)	$	1,000,000
Interest receivable		9,863
		1,009,863
Allowance for doubtful accounts		-
Debt security (at fair value), net	$	1,009,863

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Leases (Tables)

6 Months Ended

Jun. 30, 2022

Leases

Lessee, Operating Lease, Right of Use Asset and Lease Liabilities

	June 30,		December 31,
	2022		2021
Right-of-use asset
Cost
Aggregate lease commitments	$	2,385	$	1,779
Less: impact of present value		(215)		(155)
Balance	$	2,170	$	1,624
Reduction in right-of-use asset
Straight line amortization		605		346
Interest		(73)		(42)
Balance	$	532	$	304
Net book value as at:
Balance	$	1,638	$	1,320
Lease liabilities
Additions	$	2,193	$	1,647
Payments		(559)		(310)
Interest		73		42
Total lease liabilities	$	1,707	$	1,379
Current portion of lease liabilities		523		415
Long term portion of lease liabilities		1,184		964
Total lease liabilities	$	1,707	$	1,379

Lessee, Operating Lease, Liability, Maturity

2022 Remainder	$	287
2023		590
2024		609
2025		165
2026		129
2027		44
Total	$	1,824

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Stock-based compensation (Tables)

6 Months Ended

Jun. 30, 2022

Stock-based compensation

Share-based Payment Arrangement, Option, Activity

	Number of	Weighted Avg
	Options	Exercise Price
Balance at December 31, 2021	50,717,724	$	0.45
Stock options granted	21,000,000		0.32
Stock options exercised	—		—
Stock options forfeited	1,250,000		0.67
Vested stock options expired	8,960,000		0.22
Balance at June 30, 2022	61,507,724	$	0.43
Vested at June 30, 2022	15,596,349	$	0.36

Summary of issued and outstanding stock options

				Number of	Weighted avg
		Number of options	Number of	unvested	remaining life
		issued	vested options	options	outstanding
Grant date	Exercise price	and outstanding	outstanding	outstanding	(years)
March 14, 2020	0.19	1,283,557	949,682	333,875	2.71
July 9, 2020	0.18	175,000	87,500	87,500	3.03
August 25, 2020	0.13	20,000	—	20,000	3.16
October 1, 2020	0.11	266,667	116,667	150,000	3.26
October 20, 2020	0.09	20,000	10,000	10,000	3.31
December 31, 2020	0.23	16,442,500	8,807,500	7,635,000	3.51
February 26, 2021	1.87	500,000	300,000	200,000	3.66
March 1, 2021	2.06	200,000	100,000	100,000	3.67
March 8, 2021	1.88	200,000	100,000	100,000	3.69
March 15, 2021	2.49	200,000	100,000	100,000	3.71
May 12, 2021	0.78	3,450,000	900,000	2,550,000	3.87
May 14, 2021	0.75	3,200,000	850,000	2,350,000	3.87
August 11, 2021	0.57	1,100,000	175,000	925,000	4.12
August 18, 2021	0.50	200,000	—	200,000	4.14
August 23, 2021	0.50	100,000	—	100,000	4.15
September 13, 2021	0.57	800,000	—	800,000	4.21
October 1, 2021	0.58	12,650,000	—	12,650,000	4.26
January 3, 2022	0.36	100,000	—	100,000	4.52
January 4, 2022	0.35	200,000	—	200,000	4.52
January 14, 2022	0.35	200,000	—	200,000	4.55
January 16, 2022	0.35	325,000	—	325,000	4.55
January 18, 2022	0.35	100,000	—	100,000	4.56
February 14, 2022	0.30	400,000	—	400,000	4.63
February 21, 2022	0.37	200,000	—	200,000	4.65
February 25, 2022	0.35	12,400,000	—	12,400,000	4.66
March 30, 2022	0.35	200,000	—	200,000	4.75
April 1, 2022	0.34	200,000	—	200,000	4.76
April 6, 2022	0.32	100,000	—	100,000	4.77
April 7, 2022	0.31	200,000	—	200,000	4.77
April 11, 2022	0.31	75,000	—	75,000	4.78
May 2, 2022	0.25	300,000	—	300,000	4.84
May 9, 2022	0.21	700,000	—	700,000	4.86
May 11, 2022	0.20	400,000	—	400,000	4.87
May 16, 2022	0.23	100,000	—	100,000	4.88
May 31, 2022	0.24	500,000	—	500,000	4.92
June 1, 2022	0.25	500,000	—	500,000	4.92
June 6, 2022	0.26	200,000	—	200,000	4.94
June 13, 2022	0.24	200,000	—	200,000	4.96
June 17, 2022	0.24	3,100,000	3,100,000	—	4.97
Balance at June 30, 2022		61,507,724	15,596,349	45,911,375

Summary of option fair value assumptions

	February 26,			March 1,			March 8,
	2021			2021			2021
Volatility		117	%		117	%		117	%
Risk-free interest rate		0.95	%		0.92	%		1.07	%
Expected life (in years)		10			10			10
Dividend yield		0	%		0	%		0	%
Common share price	$	1.87		$	2.06		$	1.88
Strike price	$	1.87		$	2.06		$	1.88
Forfeiture rate		0	%		0	%		0	%

	May 12,			August 11,			August 23,
	2021			2021			2021
Volatility		118	%		116	%		116	%
Risk-free interest rate		1.11	%		0.96	%		0.92	%
Expected life (in years)		6.21-6.22			6.18-6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.78		$	0.56		$	0.50
Strike price	$	0.78		$	0.57		$	0.50
Forfeiture rate		0	%		0	%		0	%

	September 27,			October 1,
	2021			2021
Volatility		116	%		116	%
Risk-free interest rate		1.14	%		1.10	%
Expected life (in years)		6.25			6.25
Dividend yield		0	%		0	%
Common share price	$	0.54		$	0.57
Strike price	$	0.54		$	0.58
Forfeiture rate		0	%		0	%

	January 3,			January 4,			January 14,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		1.50	%		1.47	%		1.64	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.36		$	0.35		$	0.35
Strike price	$	0.36		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%
	January 16,			January 18,			February 14,
	2022			2022			2022
Volatility		114	%		114	%		113	%
Risk-free interest rate		1.73	%		1.74	%		1.94	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.35		$	0.35		$	0.29
Strike price	$	0.35		$	0.35		$	0.30
Forfeiture rate		0	%		0	%		0	%
	February 21,			February 25,			March 30,
	2022			2022			2022
Volatility		113	%		113	%		114	%
Risk-free interest rate		1.89	%		1.91	%		2.43	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.37		$	0.35		$	0.35
Strike price	$	0.37		$	0.35		$	0.35
Forfeiture rate		0	%		0	%		0	%

	April 1,			April 6,			April 7,
	2022			2022			2022
Volatility		114	%		114	%		114	%
Risk-free interest rate		2.53	%		2.70	%		2.72	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.33		$	0.32		$	0.31
Strike price	$	0.34		$	0.32		$	0.31
Forfeiture rate		0	%		0	%		0	%
	April 11,			May 2,			May 9,
	2022			2022			2022
Volatility		114	%		113	%		113	%
Risk-free interest rate		2.82	%		3.03	%		3.00	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.30		$	0.25		$	0.21
Strike price	$	0.31		$	0.25		$	0.21
Forfeiture rate		0	%		0	%		0	%
	May 11,			May 16,			May 31,
	2022			2022			2022
Volatility		113	%		113	%		113	%
Risk-free interest rate		2.92	%		2.86	%		2.84	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.20		$	0.22		$	0.23
Strike price	$	0.20		$	0.23		$	0.24
Forfeiture rate		0	%		0	%		0	%

	June 1,			June 6,			June 13,
	2022			2022			2022
Volatility		113	%		113	%		112	%
Risk-free interest rate		2.96	%		3.05	%		3.55	%
Expected life (in years)		6.25			6.25			6.25
Dividend yield		0	%		0	%		0	%
Common share price	$	0.25		$	0.26		$	0.24
Strike price	$	0.25		$	0.26		$	0.24
Forfeiture rate		0	%		0	%		0	%
	June 17,			June 17,			June 17,
	2022			2022			2022
Volatility		112	%		112	%		112	%
Risk-free interest rate		3.02	%		3.02	%		3.35	%
Expected life (in years)		1.37			1.64			4.27
Dividend yield		0	%		0	%		0	%
Common share price	$	0.24		$	0.24		$	0.24
Strike price	$	0.24		$	0.24		$	0.24
Forfeiture rate		0	%		0	%		0	%

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Warrants (Tables)

6 Months Ended

Jun. 30, 2022

Warrants

Schedule of Warrants Outstanding

			Weighted
			Average
	Exercise	Warrants	Remaining
Original Issue date	Price	Outstanding	Life
February 14, 2020	0.15	197,917	2.62
April 9, 2020	0.15	363,501	2.78
May 29, 2020	0.15	-	-
July 7, 2020	0.16	231,000	0.02
Balance at June 30, 2022		792,418

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Segment information (Tables)

6 Months Ended

Jun. 30, 2022

Segment information

Schedule of segments

	Diagnostics		Therapeutics		Consolidated
Net Revenue	$	148	$	7,849	$	7,997
Operating (loss) income		(12,481)		2,288		(10,193)
Interest income		384		-		384
(Loss) income before income taxes	$	(12,108)	$	2,238	$	(9,870)
Total assets	$	195,130	$	80,348	$	275,478
Depreciation and amortization		241		1,415		1,656
Capital expenditures	$	643	$	-	$	643

Schedule of long-lived assets by geographic area

		June 30,		December 31,
		2022		2021
Non-US	$	5,891	$	171,641
US		269,587		108,759
Total assets	$	275,478	$	280,400
Total US property and equipment	$	2,233	$	1,550
Total US right-of-use asset	$	1,638	$	1,320

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Loss per share (Tables)

6 Months Ended

Jun. 30, 2022

Loss per share

Schedule of Earnings Per Share, Basic and Diluted

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Numerator
Net loss for the period	$	(5,273)	$	(4,711)	$	(9,210)	$	(8,748)
Charge to retained earnings for preferred share exchange		-		-		-		(32,039)
Loss attributable to common shareholders		(5,273)		(4,711)		(9,210)		(40,787)
Denominator
Weighted average shares - basic		979,899,668		973,656,518		979,899,668		932,959,287
Stock options		—		—		—		—
Warrants		—		—		—		—
Denominator for diluted loss per share		979,899,668		973,656,518		979,899,668		932,959,287
Loss per share - basic and diluted	$	(0.005)	$	(0.005)	$	(0.009)	$	(0.044)

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Significant Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Allowance for doubtful accounts			$ 36		$ 34
Net revenue	$ 4,246	$ 16	7,997	$ 30
Assets in process	523		523		$ 420
Diagnostics [Member]
Net revenue	92	16	148	30
Revenue increase (decrease)	$ 76		$ 118
Revenue increase (decrease) (as a percent)	475.00%		393.00%
Therapeutics [Member]
Net revenue	$ 4,154	$ 0	$ 7,849	$ 0
Therapeutics [Member] | Trodes [Member]
Net revenue	2,308		4,226
Therapeutics [Member] | Instruments [Member]
Net revenue	1,543		3,102
Therapeutics [Member] | Other revenue [Member]
Net revenue	$ 303		$ 520

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Business Combination - Narrative (Details) - USD ($) $ in Thousands	Oct. 01, 2021	Jun. 30, 2022	Dec. 31, 2021
Goodwill		$ 43,288	$ 43,288
PulseVet [Member]
Ownership interest (as a percent)	100.00%
Cash payment for acquisition	$ 71,929
Goodwill	$ 43,288

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Business Combination - Allocation (Details) - USD ($) $ in Thousands	Oct. 01, 2021	Jun. 30, 2022	Dec. 31, 2021
Other receivables		$ 315	$ 450
Goodwill		$ 43,288	$ 43,288
PulseVet [Member]
Cash and cash equivalents	$ 529
Inventory	871
Prepaid expenses and deposits	365
Trade receivables	269
Other receivables	150
Property and equipment	125
Other Assets	334
Total assets acquired	36,293
Accounts payable and accrued liabilities	569
Income tax payable	44
Deferred revenue	61
Liability for contracts with customers	332
Deferred tax liabilities	6,238
Other non current liabilities	408
Total liabilities assumed	7,652
Net assets acquired, excluding goodwill	28,641
Goodwill	43,288
Net assets acquired	71,929
PulseVet [Member] | Technology [Member]
Intangible assets	$ 8,650
Intangible assets indefinite useful lives	15 years
PulseVet [Member] | Trade names [Member]
Intangible assets	$ 2,350
Intangible assets indefinite useful lives	19 years
PulseVet [Member] | Customer relationships [Member]
Intangible assets	$ 22,650
Intangible assets indefinite useful lives	11 years
PulseVet [Member] | Previously Reported [Member]
Cash and cash equivalents	$ 526
Inventory	840
Prepaid expenses and deposits	365
Trade receivables	269
Other receivables	0
Property and equipment	125
Other Assets	69
Total assets acquired	35,844
Accounts payable and accrued liabilities	1,112
Income tax payable	44
Deferred revenue	61
Liability for contracts with customers	332
Deferred tax liabilities	7,138
Other non current liabilities	143
Total liabilities assumed	8,830
Net assets acquired, excluding goodwill	27,014
Goodwill	44,915
Net assets acquired	71,929
PulseVet [Member] | Previously Reported [Member] | Technology [Member]
Intangible assets	8,650
PulseVet [Member] | Previously Reported [Member] | Trade names [Member]
Intangible assets	2,350
PulseVet [Member] | Previously Reported [Member] | Customer relationships [Member]
Intangible assets	22,650
PulseVet [Member] | Revision of Prior Period, Adjustment [Member]
Cash and cash equivalents	3
Inventory	31
Prepaid expenses and deposits	0
Trade receivables	0
Other receivables	150
Property and equipment	0
Other Assets	265
Total assets acquired	449
Accounts payable and accrued liabilities	(543)
Income tax payable	0
Deferred revenue	0
Liability for contracts with customers	0
Deferred tax liabilities	(900)
Other non current liabilities	265
Total liabilities assumed	(1,178)
Net assets acquired, excluding goodwill	1,627
Goodwill	(1,627)
Net assets acquired	0
PulseVet [Member] | Revision of Prior Period, Adjustment [Member] | Technology [Member]
Intangible assets	0
PulseVet [Member] | Revision of Prior Period, Adjustment [Member] | Trade names [Member]
Intangible assets	0
PulseVet [Member] | Revision of Prior Period, Adjustment [Member] | Customer relationships [Member]
Intangible assets	$ 0

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Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Raw Materials	$ 1,300	$ 890
Finished Goods	323	140
Purchased Inventory	3,234	1,848
Total	4,857	2,878
Reserves	(38)	(30)
Inventory, Net	4,819	2,848
Diagnostics [Member]
Raw Materials		0
Finished Goods		0
Purchased Inventory	3,234	1,848
Total	3,234	1,848
Reserves	(16)	(9)
Inventory, Net	3,218	1,839
Therapeutics [Member]
Raw Materials	1,300	890
Finished Goods	323	140
Purchased Inventory		0
Total	1,623	1,030
Reserves	(22)	(21)
Inventory, Net	$ 1,601	$ 1,009

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Prepaid Expenses Deposits and Deferred Financing Costs (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Prepaid expenses, deposits and deferred financing costs
Deposits	$ 1,966	$ 1,340
Prepaid marketing	144	83
Prepaid insurance	272	599
Other	264	214
Total	$ 2,646	$ 2,236

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Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Property, plant and equipment, gross	$ 2,721		$ 2,721		$ 2,014
Accumulated depreciation and amortization	1,011		1,011		884
Net property and equipment	1,710		1,710		1,130
Depreciation expense	71	$ 55	161	$ 115
Leasehold Improvements [Member]
Property, plant and equipment, gross	287		287		287
Machinery And Office Equipment [Member]
Property, plant and equipment, gross	2,098		2,098		1,392
Furniture And Equipment [Member]
Property, plant and equipment, gross	106		106		110
Laboratory Equipment [Member]
Property, plant and equipment, gross	$ 230		$ 230		$ 225

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Intangible Assets - Summary (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Intangible assets	$ 34,656	$ 34,240
Accumulated amortization	2,559	1,064
Total	32,097	33,176
Computer software [Member]
Intangible assets	28	28
Trademarks [Member]
Intangible assets	16	16
Website [Member]
Intangible assets	962	546
Trade names [Member]
Intangible assets	2,350	2,350
Customer relationships [Member]
Intangible assets	22,650	22,650
Technology [Member]
Intangible assets	$ 8,650	$ 8,650

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Intangible Assets - Amortization (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Intangible Assets
2022 Remainder	$ 1,542		$ 1,542
2023	2,912		2,912
2024	2,906		2,906
2025	2,809		2,809
2026 and beyond	21,928		21,928
Total	32,097		32,097		$ 33,176
Amortization - intangible assets	$ 759	$ 45	$ 1,495	$ 89

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Debt security (at fair value) (Details) - USD ($)		6 Months Ended
	May 16, 2022	Jun. 30, 2022	Jun. 30, 2021
Debt security (at fair value)
Purchase note receivable	$ 1,000,000.0	$ 1,000,000	$ 0
Fixed interest rate (as a percent)	8.00%
Debt security (at fair value)		1,000,000
Interest receivable		9,863
Total notes and interest receivable		1,009,863
Debt security (at fair value), net		1,009,863
Notes receivable fair value		1,000,000
Unrealized gain (loss)		$ 0

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Leases - Narrative (Details) $ in Thousands				3 Months Ended			6 Months Ended
	Apr. 01, 2022 USD ($) ft²	Sep. 15, 2021 USD ($)	Feb. 01, 2021 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Right-of-use asset				$ 1,638			$ 1,638		$ 1,320
Operating lease expense				179	$ 85		331	$ 176
Research and Development Expense [Member]
Operating lease expense				18	17		34	38
General and Administrative Expense [Member]
Operating lease expense				$ 161	$ 68		$ 297	$ 138
Wickfield Phoenix office lease [Member]
Operating lease term			48 months
Right-of-use asset			$ 1,258
Discount rate (as a percent)			3.95%
(Gain) loss on right-of-use assets						$ 24
Wickfield Phoenix office lease [Member] | Minimum [Member]
Monthly rent payment			$ 12
Wickfield Phoenix office lease [Member] | Maximum [Member]
Monthly rent payment			$ 31
Wickfield Phoenix warehouse lease [Member]
Operating lease term		41 months
Right-of-use asset		$ 366
Discount rate (as a percent)		3.95%
Wickfield Phoenix warehouse lease [Member] | Minimum [Member]
Monthly rent payment		$ 5
Wickfield Phoenix warehouse lease [Member] | Maximum [Member]
Monthly rent payment		$ 10
ULF Northfield Business Center [Member]
Operating lease term	61 months
Right-of-use asset	$ 546
Discount rate (as a percent)	3.95%
Lease area | ft²	12,400
ULF Northfield Business Center [Member] | Minimum [Member]
Monthly rent payment	$ 9
ULF Northfield Business Center [Member] | Maximum [Member]
Monthly rent payment	$ 11

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Leases - Balance sheet (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Leases
Aggregate lease commitments	$ 2,385	$ 1,779
Less: impact of present value and lease modification	(215)	(155)
Balance, cost	2,170	1,624
Straight line amortization	605	346
Interest	(73)	(42)
Balance, reduction in right-of-use asset	532	304
Net book value	1,638	1,320
Additions	2,193	1,647
Payments	(559)	(310)
Interest	73	42
Current portion of lease liabilities	523	415
Long term portion of lease liabilities	1,184	964
Total lease liabilities	$ 1,707	$ 1,379

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Leases - Undiscounted liability (Details) $ in Thousands	Jun. 30, 2022 USD ($)
Leases
2022 Remainder	$ 287
2023	590
2024	609
2025	165
2026	129
2027	44
Total	$ 1,824

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Stock-based Compensation - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stock-based compensation
Stock options granted (in shares)	6,575,000	7,800,000	21,000,000	9,200,000
Vesting period	4 years	4 years	4 years	4 years
Expiration period	10 years	10 years	10 years	10 years
Sharebased Payment Arrangement Expense	$ 2,492	$ 1,782	$ 4,533	$ 3,065

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Stock-based compensation - Option activity (Details) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stock-based compensation
Number of Options Options Outstanding (in shares)			50,717,724
Weighted Avg Exercise Price Options Outstanding (in dollars per share)			$ 0.45
Stock options granted (in shares)	6,575,000	7,800,000	21,000,000	9,200,000
Weighted Avg Exercise Price Stock options granted (in dollars per share)			$ 0.32
Number of Options Stock options forfeited (in shares)			1,250,000
Weighted Avg Exercise Price Stock options forfeited (in dollars per share)			$ 0.67
Number of Options Stock options cancelled (in shares)			8,960,000
Number of Options Options Outstanding (in shares)	61,507,724		61,507,724
Weighted Avg Exercise Price Options Outstanding (in dollars per share)	$ 0.43		$ 0.43
Weighted Avg Exercise Price Stock options cancelled (in dollars per share)			$ 0.22
Number of Options Options Vested (in shares)	15,596,349		15,596,349
Weighted Avg Exercise Price Vested (in dollars per share)	$ 0.36		$ 0.36

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Stock-based compensation - Option details (Details) - $ / shares	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Share-based compensation
Number of Options (in shares)	61,507,724	50,717,724
Number of vested options outstanding (in shares)	15,596,349
Number of unvested options outstanding (in shares)	45,911,375
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.32
March 14, 2020 [Member]
Share-based compensation
Number of Options (in shares)	1,283,557
Number of vested options outstanding (in shares)	949,682
Number of unvested options outstanding (in shares)	333,875
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.19
Weighted Avg Remaining Life (Year)	2 years 8 months 15 days
July 9, 2020 [Member]
Share-based compensation
Number of Options (in shares)	175,000
Number of vested options outstanding (in shares)	87,500
Number of unvested options outstanding (in shares)	87,500
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.18
Weighted Avg Remaining Life (Year)	3 years 10 days
August 25, 2020 [Member]
Share-based compensation
Number of Options (in shares)	20,000
Number of unvested options outstanding (in shares)	20,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.13
Weighted Avg Remaining Life (Year)	3 years 1 month 28 days
October 1, 2020 [Member]
Share-based compensation
Number of Options (in shares)	266,667
Number of vested options outstanding (in shares)	116,667
Number of unvested options outstanding (in shares)	150,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.11
Weighted Avg Remaining Life (Year)	3 years 3 months 3 days
October 20, 2020 [Member]
Share-based compensation
Number of Options (in shares)	20,000
Number of vested options outstanding (in shares)	10,000
Number of unvested options outstanding (in shares)	10,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.09
Weighted Avg Remaining Life (Year)	3 years 3 months 21 days
December 31, 2020 [Member]
Share-based compensation
Number of Options (in shares)	16,442,500
Number of vested options outstanding (in shares)	8,807,500
Number of unvested options outstanding (in shares)	7,635,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.23
Weighted Avg Remaining Life (Year)	3 years 6 months 3 days
February 26, 2021 [Member]
Share-based compensation
Number of Options (in shares)	500,000
Number of vested options outstanding (in shares)	300,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 1.87
Weighted Avg Remaining Life (Year)	3 years 7 months 28 days
March 1, 2021 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of vested options outstanding (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 2.06
Weighted Avg Remaining Life (Year)	3 years 8 months 1 day
March 8, 2021 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of vested options outstanding (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 1.88
Weighted Avg Remaining Life (Year)	3 years 8 months 8 days
March 15, 2021 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of vested options outstanding (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 2.49
Weighted Avg Remaining Life (Year)	3 years 8 months 15 days
May 12, 2021 [Member]
Share-based compensation
Number of Options (in shares)	3,450,000
Number of vested options outstanding (in shares)	900,000
Number of unvested options outstanding (in shares)	2,550,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.78
Weighted Avg Remaining Life (Year)	3 years 10 months 13 days
May 14, 2021 [Member]
Share-based compensation
Number of Options (in shares)	3,200,000
Number of vested options outstanding (in shares)	850,000
Number of unvested options outstanding (in shares)	2,350,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.75
Weighted Avg Remaining Life (Year)	3 years 10 months 13 days
August 11, 2021 [Member]
Share-based compensation
Number of Options (in shares)	1,100,000
Number of vested options outstanding (in shares)	175,000
Number of unvested options outstanding (in shares)	925,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.57
Weighted Avg Remaining Life (Year)	4 years 1 month 13 days
August 18, 2021 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.50
Weighted Avg Remaining Life (Year)	4 years 1 month 20 days
August 23, 2021 [Member]
Share-based compensation
Number of Options (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.50
Weighted Avg Remaining Life (Year)	4 years 1 month 24 days
September 13, 2021 [Member]
Share-based compensation
Number of Options (in shares)	800,000
Number of unvested options outstanding (in shares)	800,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.57
Weighted Avg Remaining Life (Year)	4 years 2 months 15 days
October 01, 2021 [Member]
Share-based compensation
Number of Options (in shares)	12,650,000
Number of unvested options outstanding (in shares)	12,650,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.58
Weighted Avg Remaining Life (Year)	4 years 3 months 3 days
January 3, 2022 [Member]
Share-based compensation
Number of Options (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.36
Weighted Avg Remaining Life (Year)	4 years 6 months 7 days
January 4, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 6 months 7 days
January 14, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 6 months 18 days
January 16, 2022 [Member]
Share-based compensation
Number of Options (in shares)	325,000
Number of unvested options outstanding (in shares)	325,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 6 months 18 days
January 18, 2022 [Member]
Share-based compensation
Number of Options (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 6 months 21 days
February 14, 2022 [Member]
Share-based compensation
Number of Options (in shares)	400,000
Number of unvested options outstanding (in shares)	400,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.30
Weighted Avg Remaining Life (Year)	4 years 7 months 17 days
February 21, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.37
Weighted Avg Remaining Life (Year)	4 years 7 months 24 days
February 25, 2022 [Member]
Share-based compensation
Number of Options (in shares)	12,400,000
Number of unvested options outstanding (in shares)	12,400,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 7 months 28 days
March 30, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.35
Weighted Avg Remaining Life (Year)	4 years 9 months
April 1, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.34
Weighted Avg Remaining Life (Year)	4 years 9 months 3 days
April 6, 2022 [Member]
Share-based compensation
Number of Options (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.32
Weighted Avg Remaining Life (Year)	4 years 9 months 7 days
April 7, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.31
Weighted Avg Remaining Life (Year)	4 years 9 months 7 days
April 11, 2022 [Member]
Share-based compensation
Number of Options (in shares)	75,000
Number of unvested options outstanding (in shares)	75,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.31
Weighted Avg Remaining Life (Year)	4 years 9 months 10 days
May 2, 2022 [Member]
Share-based compensation
Number of Options (in shares)	300,000
Number of unvested options outstanding (in shares)	300,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.25
Weighted Avg Remaining Life (Year)	4 years 10 months 2 days
May 9, 2022 [Member]
Share-based compensation
Number of Options (in shares)	700,000
Number of unvested options outstanding (in shares)	700,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.21
Weighted Avg Remaining Life (Year)	4 years 10 months 9 days
May 11, 2022 [Member]
Share-based compensation
Number of Options (in shares)	400,000
Number of unvested options outstanding (in shares)	400,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.20
Weighted Avg Remaining Life (Year)	4 years 10 months 13 days
May 16, 2022 [Member]
Share-based compensation
Number of Options (in shares)	100,000
Number of unvested options outstanding (in shares)	100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.23
Weighted Avg Remaining Life (Year)	4 years 10 months 17 days
May 31, 2022 [Member]
Share-based compensation
Number of Options (in shares)	500,000
Number of unvested options outstanding (in shares)	500,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.24
Weighted Avg Remaining Life (Year)	4 years 11 months 1 day
June 1, 2022 [Member]
Share-based compensation
Number of Options (in shares)	500,000
Number of unvested options outstanding (in shares)	500,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.25
Weighted Avg Remaining Life (Year)	4 years 11 months 1 day
June 6, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.26
Weighted Avg Remaining Life (Year)	4 years 11 months 8 days
June 13, 2022 [Member]
Share-based compensation
Number of Options (in shares)	200,000
Number of unvested options outstanding (in shares)	200,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.24
Weighted Avg Remaining Life (Year)	4 years 11 months 15 days
June 17, 2022 [Member]
Share-based compensation
Number of Options (in shares)	3,100,000
Number of vested options outstanding (in shares)	3,100,000
Weighted Avg Exercise Price, Stock options granted (in dollars per share)	$ 0.24
Weighted Avg Remaining Life (Year)	4 years 11 months 19 days

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Stock-based compensation - Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands																															3 Months Ended		6 Months Ended
	Jun. 17, 2022	Jun. 13, 2022	Jun. 06, 2022	Jun. 01, 2022	May 31, 2022	May 16, 2022	May 11, 2022	May 09, 2022	May 02, 2022	Apr. 11, 2022	Apr. 07, 2022	Apr. 06, 2022	Apr. 01, 2022	Mar. 30, 2022	Feb. 25, 2022	Feb. 21, 2022	Feb. 14, 2022	Jan. 18, 2022	Jan. 16, 2022	Jan. 14, 2022	Jan. 04, 2022	Jan. 03, 2022	Oct. 01, 2021	Sep. 27, 2021	Aug. 23, 2021	Aug. 11, 2021	May 12, 2021	Mar. 08, 2021	Mar. 01, 2021	Feb. 26, 2021	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Share-based compensation
Volatility	112.00%	112.00%	113.00%	113.00%	113.00%	113.00%	113.00%	113.00%	113.00%	114.00%	114.00%	114.00%	114.00%	114.00%	113.00%	113.00%	113.00%	114.00%	114.00%	114.00%	114.00%	114.00%	116.00%	116.00%	116.00%	116.00%	118.00%	117.00%	117.00%	117.00%
Risk-free interest rate		3.55%	3.05%	2.96%	2.84%	2.86%	2.92%	3.00%	3.03%	2.82%	2.72%	2.70%	2.53%	2.43%	1.91%	1.89%	1.94%	1.74%	1.73%	1.64%	1.47%	1.50%	1.10%	1.14%	0.92%	0.96%	1.11%	1.07%	0.92%	0.95%
Expected life		6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months	6 years 3 months			10 years	10 years	10 years
Dividend yield	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
Common share price (in dollars per share)	$ 0.24	$ 0.24	$ 0.26	$ 0.25	$ 0.23	$ 0.22	$ 0.20	$ 0.21	$ 0.25	$ 0.30	$ 0.31	$ 0.32	$ 0.33	$ 0.35	$ 0.35	$ 0.37	$ 0.29	$ 0.35	$ 0.35	$ 0.35	$ 0.35	$ 0.36	$ 0.57	$ 0.54	$ 0.50	$ 0.56	$ 0.78	$ 1.88	$ 2.06	$ 1.87
Strike price (in dollars per share)	$ 0.24	$ 0.24	$ 0.26	$ 0.25	$ 0.24	$ 0.23	$ 0.20	$ 0.21	$ 0.25	$ 0.31	$ 0.31	$ 0.32	$ 0.34	$ 0.35	$ 0.35	$ 0.37	$ 0.30	$ 0.35	$ 0.35	$ 0.35	$ 0.35	$ 0.36	$ 0.58	$ 0.54	$ 0.50	$ 0.57	$ 0.78	$ 1.88	$ 2.06	$ 1.87
Forfeiture rate	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
Stock-based compensation																															$ 2,492	$ 1,782	$ 4,533	$ 3,065
Minimum [Member]
Share-based compensation
Expected life																										6 years 2 months 4 days	6 years 2 months 15 days
Maximum [Member]
Share-based compensation
Expected life																										6 years 3 months	6 years 2 months 19 days
Grantee One
Share-based compensation
Risk-free interest rate	3.02%
Expected life	1 year 4 months 13 days
Grantee Two
Share-based compensation
Risk-free interest rate	3.02%
Expected life	1 year 7 months 20 days
Grantee Three
Share-based compensation
Risk-free interest rate	3.35%
Expected life	4 years 3 months 7 days

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Warrants - Narrative (Details) - $ / shares	Jul. 07, 2020	May 29, 2020	Apr. 09, 2020	Feb. 14, 2020	Jun. 30, 2022
Warrants outstanding (in shares)					792,418
Series A Warrants [Member]
Warrants outstanding (in shares)				20,833,334
Warrants outstanding term				5 years 6 months
Securities called by warrants (in shares)				20,833,334
Warrant, exercise price (in dollars per share)				$ 0.20
Placement Agent Warrants [Member]
Warrants outstanding (in shares)			1,666,667	1,041,667
Securities called by warrants (in shares)			1,666,667	1,041,667
Warrant, exercise price (in dollars per share)			$ 0.15	$ 0.15
Series B Warrants [Member]
Warrants outstanding (in shares)			16,666,667
Warrants outstanding term			5 years
Securities called by warrants (in shares)			16,666,667
Warrant, exercise price (in dollars per share)			$ 0.15
Series C Warrants [Member]
Warrants outstanding (in shares)		133,333,333
Warrants outstanding term		2 years
Securities called by warrants (in shares)		133,333,333
Warrant, exercise price (in dollars per share)		$ 0.15
Series C Pre-funded Warrants [Member]
Warrants outstanding (in shares)		12,170,000
Warrant, exercise price (in dollars per share)		$ 0.0001
Series D Warrants [Member]
Warrants outstanding (in shares)	187,500,000
Warrants outstanding term	2 years
Securities called by warrants (in shares)	187,500,000
Warrant, exercise price (in dollars per share)	$ 0.16
Series D Pre-funded Warrants [Member]
Warrants outstanding (in shares)	25,000,000
Warrant, exercise price (in dollars per share)	$ 0.0001

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Warrants - Outstanding (Details)	6 Months Ended
	Jun. 30, 2022 $ / shares shares
Warrants and Rights, Outstanding (in shares) | shares	792,418
Feb 14 2020 warrant [Member]
Warrants and Rights, Outstanding (in shares) | shares	197,917
Warrant, exercise price (in dollars per share) | $ / shares	$ 0.15
Warrants, weighted average remaining life (Year)	2 years 7 months 13 days
Apr 9 2020 warrant [Member]
Warrants and Rights, Outstanding (in shares) | shares	363,501
Warrant, exercise price (in dollars per share) | $ / shares	$ 0.15
Warrants, weighted average remaining life (Year)	2 years 9 months 10 days
May 29 2020 warrant [Member]
Warrant, exercise price (in dollars per share) | $ / shares	$ 0.15
Jul 7 2020 warrant [Member]
Warrants and Rights, Outstanding (in shares) | shares	231,000
Warrant, exercise price (in dollars per share) | $ / shares	$ 0.16
Warrants, weighted average remaining life (Year)	7 days

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Commitments and Contingencies (Details) - Seraph Biosciences, Inc. [Member] $ in Thousands	May 10, 2018 USD ($)
Future milestone payable in cash	$ 3,500
Future milestone payable in equity	$ 3,500

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Segment Information - Segment (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) segment	Jun. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Number of reportable segments | segment			2
Net revenue	$ 4,246	$ 16	$ 7,997	$ 30
Operating (loss) income	(5,880)	(5,329)	(10,193)	(9,201)
Interest income	277	112	384	167
(Loss) income before income taxes	(5,655)	(4,711)	(9,870)	(8,748)
Total assets	275,478		275,478		$ 280,400
Depreciation and amortization			1,656
Capital expenditures			643
Diagnostics [Member]
Net revenue	92	16	148	30
Operating (loss) income			(12,481)
Interest income			384
(Loss) income before income taxes			(12,108)
Total assets	195,130		195,130
Depreciation and amortization			241
Capital expenditures			643
Therapeutics [Member]
Net revenue	4,154	$ 0	7,849	$ 0
Operating (loss) income			2,288
(Loss) income before income taxes			2,238
Total assets	$ 80,348		80,348
Depreciation and amortization			$ 1,415

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Segment Information - Geographic (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Total assets	$ 275,478	$ 280,400
Property and equipment	1,710	1,130
Right-of-use asset	1,638	1,320
Non-US
Total assets	5,891	171,641
United States
Total assets	269,587	108,759
Property and equipment	2,233	1,550
Right-of-use asset	$ 1,638	$ 1,320

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Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Loss per share
Net loss	$ (5,273)	$ (4,711)	$ (9,210)	$ (8,748)
Charge to retained earnings for preferred share exchange				(32,039)
Loss attributable to common shareholders	$ (5,273)	$ (4,711)	$ (9,210)	$ (40,787)
Weighted average shares - basic (in shares)	979,899,668	973,656,518	979,899,668	932,959,287
Denominator for diluted loss per share (in shares)	979,899,668	973,656,518	979,899,668	932,959,287
Loss per share - basic (in dollars per share)	$ (0.005)	$ (0.005)	$ (0.009)	$ (0.044)
Loss per share - diluted (in dollars per share)	$ (0.005)	$ (0.005)	$ (0.009)	$ (0.044)

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Loss Per Share - Anti-dilutive (Details)	6 Months Ended
	Jun. 30, 2022 shares
Option [Member]
Antidilutive securities
Antidilutive securities (in shares)	61,507,724
Warrant [Member]
Antidilutive securities
Antidilutive securities (in shares)	792,418

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Related party transaction (Details) $ in Thousands	Mar. 01, 2022 USD ($)
Related party transaction
Related party transaction	$ 10

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Subsequent events (Details) - Subsequent events - USD ($) $ / shares in Units, $ in Thousands	Jul. 15, 2022	Jul. 01, 2022
Revo Squared
Subsequent events
Purchase price		$ 6,000
Warrant term		10 years
Warrant to purchase common stock		10,000,000
Warrant, exercise price (in dollars per share)		$ 0.2201
Contingent consideration milestones		$ 4,000
Revo Squared | Earn-out payments, net sales exceeds $5 million
Subsequent events
Contingent consideration milestones		2,000
Earnout milestone basis		5,000
Revo Squared | Earn-out payments, net sales exceeds $10 million
Subsequent events
Contingent consideration milestones		2,000
Earnout milestone basis		10,000
Revo Squared | Indemnification obligation
Subsequent events
Escrow deposit		$ 500
Escrow deposit term		15 months
Revo Squared | Post-closing adjustments
Subsequent events
Escrow deposit		$ 5
Escrow deposit term		90 days
Assisi Animal Health
Subsequent events
Purchase price	$ 18,000
Warrant term	10 years
Warrant to purchase common stock	22,000,000
Warrant, exercise price (in dollars per share)	$ 0.252
Assisi Animal Health | Indemnification obligation
Subsequent events
Escrow deposit	$ 1,400
Assisi Animal Health | Indemnification obligation | One year anniversary
Subsequent events
Escrow deposit	$ 500
Escrow deposit term	1 year
Assisi Animal Health | Indemnification obligation | 18-month anniversary
Subsequent events
Escrow deposit	$ 900
Escrow deposit term	18 months
Assisi Animal Health | Post-closing adjustments
Subsequent events
Escrow deposit	$ 200
Escrow deposit term	90 days