(

)

Significant Accounting Policies

	(a)	Basis of Preparation

		The accompanying condensed consolidated balance sheets, statements of operations, shareholders' equity, and cash flows as of September 30, 2020 and for the three and nine months ended September 30, 2020 and 2019 are unaudited. The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information and on a basis consistent with the annual financial statements and, in the opinion of management, reflect all adjustments which include only normal recurring adjustments, necessary to present fairly its financial position as of September 30, 2020, results of operations for the three and nine months ended September 30, 2020 and 2019, and cash flows for the nine months ended September 30, 2020 and 2019. The results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results to be expected for the year ended December 31, 2020 or for any other interim period or for any other future year.

		These condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes included in the Company's Annual Report on Form 10 -K for the year ended December 31, 2019, filed with the SEC on April 9, 2020. The results for the three months ended September 30, 2020 are not necessarily indicative of the results to be expected for the year ending December 31, 2020 or for any other interim period or for any other future year, particularly in light of the novel coronavirus pandemic, or COVID- 19, and its impact on domestic and global economies. To limit the spread of COVID- 19, governments have taken various actions including the issuance of stay-at-home orders and social distancing guidelines, causing some businesses to suspend operations and/or experience a reduction in demand for many products from direct or ultimate customers. Accordingly, businesses have adjusted, reduced or suspended operating activities and are continuing to adapt to these changing actions and guidelines. Beginning March 17, 2020, substantially all of the Company's workforce began working from home. On April 6, manufacturing operations resumed at the Company's facilities, with substantially all other staff continuing to work from home. While the direct effects of the stay-at-home orders and BioCardia's work-from-home policies have been largely mitigated during the three months ended September 30, 2020, the overall impact of the pandemic has resulted in disruption to the Company's business and resulted in delays in the Company's development programs and regulatory and commercialization timelines. The overall magnitude of the continuing impact will depend, in part, on the length and severity of changing restrictions and other limitations on BioCardia's ability to conduct the Company's business. BioCardia's future research and development expenses and general and administrative expenses may vary significantly if the Company experiences an increased impact from COVID- 19 on the costs and timing associated with the conduct of BioCardia's clinical trials and other related business activities.

BioCardia's ability to raise additional funds

may

be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the ongoing COVID-

pandemic.

	(b)	Liquidity and Other Risks and Uncertainties

		Going Concern and Liquidity - The Company has incurred net losses and negative cash flows from operations since its inception and had an accumulated deficit of $113.1 million as of September 30, 2020. Management expects operating losses and negative cash flows to continue through at least the next several years. The Company expects to incur increasing costs as it advances its trials and development activities. Therefore, absent additional funding, management believes cash and cash equivalents of $7.4 million as of September 30, 2020 are not sufficient to fund the Company beyond the second quarter of 2021. These factors raise substantial doubt about the Company's ability to continue as a going concern beyond one year from the date these financial statements are issued. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

		The Company's ability to continue as a going concern and to continue further development of its therapeutic candidates beyond the second quarter of 2021, will require the Company to raise additional capital. The Company plans to raise additional capital, potentially including debt and equity arrangements, to finance its future operations. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. If adequate funds are not available, the Company may be required to reduce operating expenses, delay or reduce the scope of its product development programs, obtain funds through arrangements with others that may require the Company to relinquish rights to certain of its technologies or products that the Company would otherwise seek to develop or commercialize itself, or cease operations.

	(c)	Use of Estimates

		The preparation of the financial statements in accordance with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. Significant items subject to such estimates and assumptions include share-based compensation, the useful lives of property and equipment, right-of-use assets and related liabilities, incremental borrowing rate, allowances for doubtful accounts and sales returns, derivative instruments, clinical accruals, and inventory valuation.

	(d)	Principles of Consolidation

		The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated during the consolidation process.

	(e)	Changes to Significant Accounting Policies

		The Company's significant accounting policies are described in Note 2 of the notes to the consolidated financial statements included in its Annual Report on Form 10 -K filed April 9, 2020 for the year ended December 31, 2019. There have been no changes to those policies.

	(f)	Recently Issued Accounting Pronouncements

		Recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force did not or are not believed by management to have a material impact on the Company's financial statement presentation or disclosures.