Good day, welcome to the ENDRA Life Sciences Inc.'s first quarter 2023 financial results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Yvonne Briggs. Please go ahead.
Thank you, operator. This is Yvonne Briggs with LHA. Good afternoon, and welcome to ENDRA's first quarter 2023 business update and financial results conference call. Earlier today, ENDRA issued a press release on this topic, which is available in the investors section of ENDRA's website. Before we begin, please note that today's discussion will include forward-looking statements. All statements by management, other than statements of historical facts, including statements regarding the company's strategies, financial condition, operations, costs, plans and objectives, as well as anticipated results of development and commercialization efforts, the timing of clinical studies, potential partnership opportunities, and expectations regarding regulatory processes, receipt of required regulatory clearances and product launches are forward-looking statements. Except as required by federal securities laws, the company disclaims any obligation to update or revise any forward-looking statements.
Please refer to the company's Form 10-K for the 2022 fiscal year and subsequent SEC filings for more information about risks and uncertainties related to forward-looking statements. In terms of the structure of today's call, Francois Michelon, Chairman and Chief Executive Officer, will begin the prepared remarks, followed by Michael Thornton, ENDRA's Chief Technology Officer. Mr. Thornton will be followed by Irina Pestrikova, Senior Director of Finance, to review the first quarter financial results. With that said, I will now turn the call over to Francois Michelon. Francois.
Thank you, Yvonne. Good afternoon, everyone. Thanks for joining us today to discuss ENDRA's first quarter 2023 financial results and business highlights. I'm extremely pleased to report that we've completed the clinical data collection to support our De Novo request to the U.S. FDA. Collectively, more than 100 subject scans have been performed with our interactive guidance tool. We believe these scans will demonstrate the ability of TAEUS to measure liver fat in the earlier stages of non-alcoholic fatty liver disease, known as NAFLD, at the point of patient care. We're analyzing the collected data and expect to make our De Novo submission to the FDA mid-year. We believe this regulatory pathway will assist ENDRA in achieving the strongest market potential with TAEUS optimized claims, as the De Novo process is reserved for novel technologies without equivalents in the market.
Mike Thornton will provide more detail on our clinical progress shortly. Thermo-Acoustic Enhanced Ultrasound, known as TAEUS, is an integral part of ENDRA's vision to provide better health care to more people by introducing point-of-care technology that addresses areas of high unmet clinical need. Non-alcoholic fatty liver disease affects over 2 billion people globally, and there are currently no diagnostic tools that combine accuracy, safety, cost- effectiveness, and ease of use. MRI is accurate, but it's also expensive and slow. Liver biopsy is painful and can only be performed by someone with surgical training. Traditional Ultrasound derivatives can measure liver stiffness, but haven't yet demonstrated the necessary sensitivity to stage NAFLD patients in the early phases of the disease when it's most reversible. The annual liver disease diagnostic market opportunity is estimated to $12.5 billion in size.
The advent of the first targeted NAFLD drug therapies intensifies the need for clinicians to identify appropriate patients with practical diagnostic tools, and then to monitor the response of those patients on the drugs. TAEUS aims to fill that gap and help clinicians accurately characterize the liver non-invasively at the point of patient care and at 150th the cost of an MRI. Given these unmet clinical needs and TAEUS' potential to assess liver fat at the point of care, we're very excited to have collected the data necessary for our De Novo request as it represents a significant milestone for the company. Turning to intellectual property, we've made some great progress here too, increasing our patent portfolio with seven newly issued patents so far this year, bringing the total portfolio to 63 issued patents and 31 filed assets.
This significant growth in patents not only protects our technology, but also creates opportunities for out licensing. Finally, subsequent to the close of the quarter, we were able to strengthen the company's balance sheet with an upsized capital raise of $4.5 million in net proceeds despite the challenging capital market conditions. We'd like to thank the participation of long-term investors and company insiders for this capital, which positions ENDRA to achieve key milestones such as FDA submission and commercial deployment. Okay, over to Mike Thornton for detail on our clinical progress. Mike?
Thank you, Francois. In our most recent Q4 update, we reported that over 100 study participant exams had been obtained at our clinical study sites in 2022, and observed that while some users were able to obtain TAEUS measurements with high reproducibility that is commensurate with our TAEUS system's capabilities to produce highly repeatable measurements, other users had significantly higher variability. With the aim of normalizing user performance across our clinical collaborator study sites, we deployed additional user training and graphical user guidance tools that provide feedback to the operator regarding the efficacy of probe positioning, with the aim of producing valid measurements with our fatty liver assessment system. Since February of this year, our clinical collaborators have obtained more than 100 study participant exams with the user guidance tool.
The feedback from users at our three clinical sites has been overwhelmingly positive, with users highlighting the reduction in procedure time and improvement in overall usability. These TAEUS exams were typically completed in 10 minutes, including the Ultrasound localization procedure that is required for our fatty liver assessment measurement. As for our upcoming FDA submission, we've now completed the necessary exams and are in the process of reviewing the data package prior to submission. We believe that we have a sufficient number of TAEUS exams with sufficient quality and the associated MRI-derived gold standard NAFLD markers necessary to support our De Novo submission. In addition to the data collection for the De Novo submission, we'll continue to work with our current and future clinical study partners to add to the clinical evidence for our TAEUS system.
We're very fortunate to have existing clinical partners in key global markets that will serve as reference sites to support commercialization. I'm also pleased to announce that a clinical abstract featuring ENDRA's thermoacoustic assessment of fatty liver disease has been accepted by the European Association for the Study of the Liver for presentation at the International Liver Congress in June in Vienna. ENDRA's abstract, which will be published in early June, is derived from a cohort of study participant exams obtained at a single U.S. clinical site in early 2022 before the software guidance tool was deployed. All the sample size was small and the scans were performed before we introduced the current guidance tool. The abstract highlights the correlation of TAEUS measurements to MRI-PDFF, as well as TAEUS' potential to differentiate mild from moderate severe fatty liver disease.
Scientific and medical association journals and conference presentations are the primary forums for introducing new procedures and approaches to the management of diseases, and in turn, drive the adoption of new technologies. This peer-reviewed abstract is only the first of what we expect to be several conference presentations in 2023 that will publicize ENDRA's technologically innovative work and the initial clinical performance. In addition to the accepted abstract for the European ILC meeting in June, we plan to submit multiple abstracts to the American Association for the Study of Liver Diseases meeting and the European NAFLD Summit. I'd like to turn the call over to Irina to review the financial results for the first quarter of 2023. Irina.
Thank you, Mike. For the quarter ended March 31, 2023, our operating expenses were $2.9 million, unchanged from 2022. Increases in research and development and general and administrative expenses were offset by decreases in sales and marketing expenses. Our research and development expense increased year-over-year by approximately $180,000 due to ongoing product development work. Our sales and marketing expenses decreased by approximately $160,000 for the quarter, mainly due to the departure of our Chief Commercial Officer. General administrative expenses increased by approximately $60,000 due to increased spending on legal fees. Net loss per share in the first quarter of 2023 was $0.93, compared with a net loss of $1.33 per share in the first quarter of 2022.
Cash and cash equivalents were $2.4 million as of March 31, 2023. As Francois just mentioned, subsequent to the close of the quarter, the company raised approximately $4.5 million in net proceeds through a registered offering. We believe our current capital position provides runway into the fourth quarter of 2023. We maintain our asset light operating model with prudent hires in our operations and commercial team in anticipation of future growth. As we execute our regulatory and commercial strategy for TAEUS, we plan to adjust our expense structure accordingly in support of these activities. I'll turn the call back to Francois.
Thanks very much, Irina, and thank you, Mike. In closing, here are the three key messages I'd like listeners to take away from this call. First, we've completed the collection of our clinical data necessary to support TAEUS De Novo request to the FDA, which we expect to submit mid-year. In addition, we'll leverage this clinical data to arm our sales team with strong clinical value propositions to further our commercial efforts in Europe.
Second, we're maintaining a steady cadence of marketing activities to expand awareness of our TAEUS technology with a range of clinical specialties, particularly in Europe, where we have CE regulatory approval. These activities center on participating in key radiology, hepatology, and endocrinology conferences where clinicians go to learn about the latest research and new technologies. We're entering a new level of market awareness with the first TAEUS clinical abstract accepted for presentation at a major European clinical society in June. We'll continue to publicize the clinical performance of our TAEUS system through additional peer-reviewed papers and abstracts. Third, and finally, with the recent capital raise, we're in a solid position to fund our achievement of key milestones, including FDA submission and commercial deployment in Europe. With that overview, I'd love to turn the call over to questions. Operator?
We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from Edward Woo with Ascendiant Capital. Please go ahead.
Yeah.
Hi, Ed.
Congratulations on the progress on the FDA's De Novo submission. My question is on the, you know, the marketing in Europe in terms of, you know, it's been CE approved for a couple of years. Have you learned anything that you may find useful as, you know, when you do get approval in the U.S.?
Yeah. I think, first of all, great question. I think we've learned so much. I think first and foremost, we initially believed that radiology would be our primary, if not sole target, because radiologists are the ones today performing a lot of the Ultrasound liver scans for other reasons, gallbladder defects, et cetera. We thought we would simply add a nice new capability to measure liver fat to their arsenal. What we've realized is there's considerable interest outside of radiology, going to these conferences and being approached by those clinicians, specifically the gastro hepatologists. Hepatology, the study of the liver, is a subspecialty of gastroenterology.
As we mentioned, with the advent of targeted drugs to treat NAFLD and the inflammatory form NASH, these specialties, gastro hepatology and endocrinology, really see an opportunity to get more deeply involved with patient care upstream from the more acute stages that they typically see of advanced liver disease, and also to treat obesity in diabetic patients who are very prone to liver disease. I'd say that the first and primary lesson learned from the commercial activities is really that the market is bigger than we thought and certainly broader than the radiology segment in particular. That we have, you know, opportunities with proper positioning and value propositions for each sector. Radiology, adding new imaging capabilities to their arsenal. Hepatology, providing them with new tools to take care of the liver.
Endocrinology, which is focused on obesity, diabetes, to enable them to have an important biomarker, liver fat, to help manage patients in that domain. I would say that's the most important and very encouraging takeaway as we've been in the field. I'd ask Mike Thornton, actually, if you have any thoughts from your interactions in the field, what you might have learned that we could inform our listeners with?
Thanks, Francois. I think I'll just add on the drug development side. We've all been waiting for a NASH drug to be approved, but we've seen that semaglutide and other GLP-1 agonist drugs have come on the market, and they've become very prominent in the fatty liver health space. I think we're pretty excited about the impact that these diabetes weight reduction drugs are having on fatty liver and the interest to monitor fatty liver disease and associated metabolic disorders.
Thanks, Mike. I hope that helped answer the question, Ed.
Thank you. That's for sure. Yeah, you guys are very thorough, so thank you very much. I wish you guys good luck with your submission. Thank you.
Thank you so much.
There are no more questions at this time. This concludes the question and answer session. I would like to turn the conference back over to Francois Michelon for closing remarks.
Jordan and our listeners, thank you so much for joining us today. Very excited about the progress we've made and shared with you today, and we look forward to keeping you updated in the coming months, speaking with you on the next quarterly conference call, and we wish you all a good evening. Thank you.