Organization	9 Months Ended
Sep. 30, 2022
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Organization	Note 1. Organization The Company Ra Medical Systems, Inc. (the “Company”) is a medical device company that owns intellectual property related to an advanced excimer laser-based platform for use in the treatment of vascular immune-mediated inflammatory diseases. Its excimer laser and single-use catheter system, together referred to as the DABRA Excimer Laser System, (“DABRA”), is used as a tool in the treatment of peripheral artery disease. The Company was formed on September 4, 2002 in the state of California and reincorporated in Delaware on July 14, 2018. Pending Merger On September 12, 2022, the Company announced entering into an Agreement and Plan of Merger (the “Merger Agreement”) with a privately-held Delaware corporation, Catheter Precision, Inc. (“Catheter”), a medical device and technology company focused in the field of cardiac electrophysiology. Under the terms of the Merger Agreement, Catheter will become a wholly owned subsidiary of the Company in a stock-for-stock reverse merger transaction (the “Merger”). If completed, the Merger will result in a combined publicly traded company that will focus on the cardiac electrophysiology market. The Company’s board of directors and the board of directors of Catheter have approved the Merger, which is currently expected to close before the end of 2022 or early 2023, subject to satisfying certain closing conditions, including the receipt of shareholder approval by both companies. The Company expects that it will need to raise additional financing in an amount of between $2.0 million and $3.0 million in order to consummate the pending merger with Catheter, in order to meet the $8.0 million “Net Cash” closing requirement under the Merger Agreement and additional original listing requirements of the NYSE American. In addition, the Company needs to meet certain minimum pricing conditions under the Merger Agreement and the listing standards of the NYSE American stock exchange in order for the Merger to close and its shares to continue to be listed on the NYSE American. Reverse Stock Split On September 20, 2022, the Company’s board of directors approved a reverse stock split ratio of 1-for-50 (the “Reverse Stock Split”). On the effective date of October 3, 2022, the number of the Company’s issued and outstanding shares of common stock was decreased from 68.2 million shares to 1.4 million shares. The number of authorized shares and par value per common share remained unchanged. No fractional shares were issued as a result of the Reverse Stock Split. Stockholders who would otherwise have been entitled to receive a fractional share received a cash payment in lieu thereof. The financial statements have been retrospectively adjusted to reflect the Reverse Stock Split of the Company’s common stock for all periods presented. NYSE American On August 31, 2022, the Company received a deficiency letter (the “Letter”) from NYSE American indicating that it was not in compliance with NYSE American continued listing standards as set forth in Section 1003(f)(v) of the NYSE American Company Guide because its shares of common stock had been selling for a substantial period of time at a low price per share, which NYSE American determined to be a 30 trading day average price of less than $0.20 per share. The Letter had no immediate effect on the listing or trading of the Company’s common stock, and the common stock continues to trade on NYSE American under the symbol “RMED.” The Company believes that the aforementioned Reverse Stock Split and accompanying increase in the daily share price of its common stock cured the deficiency, however, the Company had not received confirmation from NYSE American as of the date of this Quarterly Report. Reduction in Force and Operations As previously reported, the Company’s board of directors approved a reduction in force (“RIF”) under which approximately 65% of its full-time employees were immediately terminated, effective June 6, 2022, and provided one-time severance payments totaling $0.6 million. In August and September 2022, an additional 20% of the Company’s employees were terminated and were provided one-time severance payments totaling $0.3 million. The purpose of the RIF was to preserve capital with the goal of maximizing the opportunities available to the Company while the board of directors’ reviewed strategic alternatives. See further discussion in Note 13. Restructuring and Impairment Charges. As a result of the RIF, the discontinuation of enrollment in the clinical study and the board of directors’ review of strategic alternatives, the Company has paused all engineering and manufacturing activities, including the development of a version of the DABRA catheter that is compatible with a standard interventional guidewire. The Company has also paused research to prove the feasibility of using a DABRA-derived catheter technology to fracture calcium in arteries in a procedure known as lithotripsy. On July 5, 2022, the Company announced the receipt of FDA 510(k) clearance for the DABRA 2.0 catheter as part of the DABRA Excimer Laser System. This catheter includes a braided over jacket to make the catheter more robust and more kink-resistant when navigating tortuous anatomy. This catheter also has a six-month shelf life as a result of multiple design and manufacturing remediations implemented to address prior limitations. The Company has suspended sales of DABRA and currently has no plans to commercialize the DABRA 2.0, pending the closing of the Merger. Going Concern The Company has incurred recurring net losses from operations and negative cash flows from operating activities since inception. As of September 30, 2022, the Company had an accumulated deficit of $197.0 million. For the nine months ended September 30, 2022, the Company used cash of $19.5 million in operating activities. As of September 30, 2022, the Company had cash and cash equivalents of $13.7 million. Management continues to monitor operating costs and seeks to reduce the Company’s current liabilities. Such actions may impair the Company’s ability to proceed with certain strategic activities, and the Company may be unsuccessful at negotiating existing liabilities to the Company’s benefit. If these efforts are unsuccessful, or the Merger is not completed, the Company’s cash position could be negatively impacted and the Company may, among other things, be required to seek other sources of financing, consummate another strategic transaction or be required to liquidate its assets and dissolve the Company. If the Merger is completed, the combined entity may not have sufficient cash to fund its operations for next year. Catheter has historically generated negative cash flows from operations. Catheter’s expected revenue growth may not be achieved, and expenditures to achieve growth may exceed expectations. Because of the significant uncertainty regarding the Company’s future plans, the Company is not able to accurately predict the impact of a potential change in its business strategy and future funding requirements. Management believes that, based on the Company’s liquidity resources and the significant uncertainty regarding its future plans, there is substantial doubt about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of the financial statements. The Company’s independent registered public accounting firm expressed substantial doubt regarding the Company’s ability to continue as a going concern in its report on the Company’s financial statements as of and for the year ended December 31, 2021. Although the Company improved its liquidity resources during the nine months ended September 30, 2022 through a private placement, proceeds from warrant exercises and sales of common stock under the At-The-Market Sales Agreement with Ladenburg Thalmann & Co., Inc. (the “ATM Agreement”) resulting in total net cash proceeds of $18.2 million, and may receive additional funds from the sale of common stock under the ATM Agreement and exercise of warrants depending on market conditions, management has concluded that the aforementioned conditions continue to raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of the financial statements. Management plans to address this uncertainty by raising additional funds, if necessary, through public or private equity or debt financings as well as by engaging in regular and ongoing reviews of its strategic options to help ensure that the Company is focusing its cash resources on advancing its key corporate initiatives. However, the Company may not be able to secure such financing in a timely manner or on favorable terms, if at all. Furthermore, if the Company issues equity securities to raise additional funds, its existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of the Company’s existing stockholders. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classification of liabilities that may result from the outcome of this uncertainty. COVID-19 The global effects of COVID-19 have created significant volatility, uncertainty and economic disruption. Although restrictions have been recently eased around the world, the COVID-19 pandemic is still ongoing, and the ultimate effects of COVID-19 on the Company’s business, operations and financial condition are unknown at this time. The Company expects that patient follow-up in its atherectomy clinical trial may continue to be affected by the uncertainty relating to COVID-19, as patients may continue to elect to postpone follow-up visits and physicians’ offices may intermittently close or operate at a reduced capacity in response to COVID-19. The extent to which COVID-19 impacts the Company’s business will depend on future developments which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain it or treat its impact, among others.

Organization

9 Months Ended

Sep. 30, 2022

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Note 1. Organization

The Company

Ra Medical Systems, Inc. (the “Company”) is a medical device company that owns intellectual property related to an advanced excimer laser-based platform for use in the treatment of vascular immune-mediated inflammatory diseases. Its excimer laser and single-use catheter system, together referred to as the DABRA Excimer Laser System, (“DABRA”), is used as a tool in the treatment of peripheral artery disease. The Company was formed on September 4, 2002 in the state of California and reincorporated in Delaware on July 14, 2018.

Pending Merger

On September 12, 2022, the Company announced entering into an Agreement and Plan of Merger (the “Merger Agreement”) with a privately-held Delaware corporation, Catheter Precision, Inc. (“Catheter”), a medical device and technology company focused in the field of cardiac electrophysiology. Under the terms of the Merger Agreement, Catheter will become a wholly owned subsidiary of the Company in a stock-for-stock reverse merger transaction (the “Merger”). If completed, the Merger will result in a combined publicly traded company that will focus on the cardiac electrophysiology market. The Company’s board of directors and the board of directors of Catheter have approved the Merger, which is currently expected to close before the end of 2022 or early 2023, subject to satisfying certain closing conditions, including the receipt of shareholder approval by both companies.

The Company expects that it will need to raise additional financing in an amount of between $2.0 million and $3.0 million in order to consummate the pending merger with Catheter, in order to meet the $8.0 million “Net Cash” closing requirement under the Merger Agreement and additional original listing requirements of the NYSE American. In addition, the Company needs to meet certain minimum pricing conditions under the Merger Agreement and the listing standards of the NYSE American stock exchange in order for the Merger to close and its shares to continue to be listed on the NYSE American.

Reverse Stock Split

On September 20, 2022, the Company’s board of directors approved a reverse stock split ratio of 1-for-50 (the “Reverse Stock Split”). On the effective date of October 3, 2022, the number of the Company’s issued and outstanding shares of common stock was decreased from 68.2 million shares to 1.4 million shares. The number of authorized shares and par value per common share remained unchanged. No fractional shares were issued as a result of the Reverse Stock Split. Stockholders who would otherwise have been entitled to receive a fractional share received a cash payment in lieu thereof. The financial statements have been retrospectively adjusted to reflect the Reverse Stock Split of the Company’s common stock for all periods presented.

NYSE American

On August 31, 2022, the Company received a deficiency letter (the “Letter”) from NYSE American indicating that it was not in compliance with NYSE American continued listing standards as set forth in Section 1003(f)(v) of the NYSE American Company Guide because its shares of common stock had been selling for a substantial period of time at a low price per share, which NYSE American determined to be a 30 trading day average price of less than $0.20 per share. The Letter had no immediate effect on the listing or trading of the Company’s common stock, and the common stock continues to trade on NYSE American under the symbol “RMED.” The Company believes that the aforementioned Reverse Stock Split and accompanying increase in the daily share price of its common stock cured the deficiency, however, the Company had not received confirmation from NYSE American as of the date of this Quarterly Report.

Reduction in Force and Operations

As previously reported, the Company’s board of directors approved a reduction in force (“RIF”) under which approximately 65% of its full-time employees were immediately terminated, effective June 6, 2022, and provided one-time severance payments totaling $0.6 million. In August and September 2022, an additional 20% of the Company’s employees were terminated and were provided one-time severance payments totaling $0.3 million. The purpose of the RIF was to preserve capital with the goal of maximizing the opportunities available to the Company while the board of directors’ reviewed strategic alternatives. See further discussion in Note 13. Restructuring and Impairment Charges.

As a result of the RIF, the discontinuation of enrollment in the clinical study and the board of directors’ review of strategic alternatives, the Company has paused all engineering and manufacturing activities, including the development of a

version of the DABRA catheter that is compatible with a standard interventional guidewire. The Company has also paused research to prove the feasibility of using a DABRA-derived catheter technology to fracture calcium in arteries in a procedure known as lithotripsy. On July 5, 2022, the Company announced the receipt of FDA 510(k) clearance for the DABRA 2.0 catheter as part of the DABRA Excimer Laser System. This catheter includes a braided over jacket to make the catheter more robust and more kink-resistant when navigating tortuous anatomy. This catheter also has a six-month shelf life as a result of multiple design and manufacturing remediations implemented to address prior limitations. The Company has suspended sales of DABRA and currently has no plans to commercialize the DABRA 2.0, pending the closing of the Merger.

Going Concern

The Company has incurred recurring net losses from operations and negative cash flows from operating activities since inception. As of September 30, 2022, the Company had an accumulated deficit of $197.0 million. For the nine months ended September 30, 2022, the Company used cash of $19.5 million in operating activities. As of September 30, 2022, the Company had cash and cash equivalents of $13.7 million.

Management continues to monitor operating costs and seeks to reduce the Company’s current liabilities. Such actions may impair the Company’s ability to proceed with certain strategic activities, and the Company may be unsuccessful at negotiating existing liabilities to the Company’s benefit. If these efforts are unsuccessful, or the Merger is not completed, the Company’s cash position could be negatively impacted and the Company may, among other things, be required to seek other sources of financing, consummate another strategic transaction or be required to liquidate its assets and dissolve the Company. If the Merger is completed, the combined entity may not have sufficient cash to fund its operations for next year. Catheter has historically generated negative cash flows from operations. Catheter’s expected revenue growth may not be achieved, and expenditures to achieve growth may exceed expectations. Because of the significant uncertainty regarding the Company’s future plans, the Company is not able to accurately predict the impact of a potential change in its business strategy and future funding requirements.

Management believes that, based on the Company’s liquidity resources and the significant uncertainty regarding its future plans, there is substantial doubt about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of the financial statements. The Company’s independent registered public accounting firm expressed substantial doubt regarding the Company’s ability to continue as a going concern in its report on the Company’s financial statements as of and for the year ended December 31, 2021.

Although the Company improved its liquidity resources during the nine months ended September 30, 2022 through a private placement, proceeds from warrant exercises and sales of common stock under the At-The-Market Sales Agreement with Ladenburg Thalmann & Co., Inc. (the “ATM Agreement”) resulting in total net cash proceeds of $18.2 million, and may receive additional funds from the sale of common stock under the ATM Agreement and exercise of warrants depending on market conditions, management has concluded that the aforementioned conditions continue to raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of the financial statements. Management plans to address this uncertainty by raising additional funds, if necessary, through public or private equity or debt financings as well as by engaging in regular and ongoing reviews of its strategic options to help ensure that the Company is focusing its cash resources on advancing its key corporate initiatives. However, the Company may not be able to secure such financing in a timely manner or on favorable terms, if at all. Furthermore, if the Company issues equity securities to raise additional funds, its existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of the Company’s existing stockholders.

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classification of liabilities that may result from the outcome of this uncertainty.

COVID-19

The global effects of COVID-19 have created significant volatility, uncertainty and economic disruption. Although restrictions have been recently eased around the world, the COVID-19 pandemic is still ongoing, and the ultimate effects of COVID-19 on the Company’s business, operations and financial condition are unknown at this time. The Company expects that patient follow-up in its atherectomy clinical trial may continue to be affected by the uncertainty relating to COVID-19, as patients may continue to elect to postpone follow-up visits and physicians’ offices may intermittently close or operate at a reduced capacity in response to COVID-19. The extent to which COVID-19 impacts the Company’s business will depend on future developments which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain it or treat its impact, among others.