Beyond Air, Inc. — Form 10-K Summary
Reporting period: Fiscal year ended March 31, 2024, compared with the year ended March 31, 2023. Although the request labels the period “2023 Q4,” this filing reports annual results; it does not provide a clear standalone fourth-quarter financial summary. Amounts below are in U.S. dollars.
Business context
Beyond Air is a commercial-stage medical device and biopharmaceutical company developing nitric oxide (NO) generators and delivery systems. Its FDA-approved LungFit PH system is marketed in the U.S. for persistent pulmonary hypertension of the newborn (PPHN). The company also has investigational programs for respiratory conditions, including viral pneumonia, bronchiolitis and nontuberculous mycobacteria (NTM), and separate oncology and neurological programs. Beyond Air owns 80% of Beyond Cancer, which is developing ultra-high-concentration NO for solid tumors.
Financial and operating results
| Metric | FY ended March 31, 2024 | FY ended March 31, 2023 |
|---|---|---|
| Revenue | $1.159 million | $0 |
| Cost of revenue | $2.466 million | $0.555 million |
| Gross loss | $1.307 million | $0.555 million |
| Research and development | $24.363 million | $16.810 million |
| General and administrative | $37.337 million | $34.694 million |
| Operating loss | $63.006 million | $52.059 million |
| Net loss | $64.295 million | $59.401 million |
| Net loss attributable to Beyond Air | $60.242 million | $55.816 million |
| Basic and diluted loss per share | $1.82 | $1.86 |
| Net cash used in operating activities | $56.014 million | $33.009 million |
FY2024 gross margin was approximately negative 113%, reflecting cost of revenue above revenue. Management attributed this primarily to supply-chain infrastructure investments to support future growth and depreciation of devices not yet deployed. Revenue arose from LungFit PH leases; the filing reports approximately $1.2 million of lease revenue and $1.0 million of related cash receipts in FY2024.
Cash and cash equivalents were $11.378 million and marketable securities were $23.090 million at March 31, 2024, for combined cash and securities of $34.468 million. Restricted cash was $0.230 million; total cash, cash equivalents and restricted cash were $11.608 million. The company also reported $5.0 million deposited with a contract manufacturer for future materials, recorded as a prepaid asset rather than cash.
Total liabilities were $29.775 million and total equity was $27.186 million. The Avenue loan had $17.5 million principal outstanding; its balance-sheet carrying value, net of debt discount and including the final-payment liability, was $14.721 million. The loan bears interest at the greater of prime plus 3.75% or 12%, is secured by substantially all company assets, and includes a $5.0 million minimum unrestricted-cash covenant. Monthly principal payments were scheduled to begin January 2025; a June 2024 amendment extended the interest-only period by six months.
Changes versus the prior year
- Revenue began following the commercial launch and increased from zero to $1.159 million, but remained below cost of revenue.
- Operating loss increased by approximately $10.9 million. R&D expense rose $7.6 million, mainly due to clinical-trial spending, salaries and professional fees; G&A expense rose $2.7 million.
- Operating cash use increased by $23.0 million, from $33.0 million to $56.0 million. The company reported a $239.7 million accumulated deficit at year-end.
- Financing cash inflows were $43.2 million, including $15.8 million net loan proceeds, $13.4 million from the ATM and $14.6 million net proceeds from a March 2024 registered offering. Common shares outstanding increased from 30.7 million to 45.9 million during the year.
- Other expense fell year over year, in part because FY2023 included substantial litigation-related charges. FY2024 included $2.9 million of interest and finance expense and a $3.1 million payment related to the Hudson settlement; the Empery judgment was paid in April 2023 for $7.6 million.
Outlook, risks and unusual items
- Liquidity and going concern: Management expects continuing losses and significant cash outflows and concluded that additional funding is needed within one year of the financial statements’ issuance. The auditor’s report includes a going-concern explanatory paragraph stating that substantial doubt exists about the company’s ability to continue as a going concern. Potential funding sources include the remaining $32.9 million under the ATM, a conditional $10.0 million loan tranche, a discretionary tranche of up to $12.5 million, further equity financing, and partnerships or licensing. Availability is not assured.
- Commercial and regulatory execution: LungFit PH commercialization is early, and adoption, reimbursement, pricing, market access and scaling the sales organization remain uncertain. The company expected EU MDR certification in the second half of calendar 2024 and anticipated a possible international launch in late 2024, subject to certification and partnerships. It had submitted an FDA supplement to expand the LungFit PH label to certain cardiac surgeries.
- Pipeline and funding: The U.S. VCAP clinical study was paused pending future funding. Management anticipated a pivotal NTM trial in calendar 2026, subject to FDA discussions, and a first-in-human nNOS inhibitor trial in 2025. These are forward-looking plans, not assured milestones.
- Beyond Cancer: The filing reports that the first six subjects in the Phase 1a study had no dose-limiting toxicities at the initial 25,000 ppm dose; the next dose cohort had begun. The company was discussing financing for Beyond Cancer. The program remains investigational.
- Debt and dilution: The Avenue facility’s remaining tranches are conditional, and its covenants, security interest, interest rate and default provisions could constrain operations. The March 2024 offering issued 9.64 million shares and warrants for a further 9.64 million shares at $2.25 per share, subject to terms and ownership limits. The filing also describes a warrant call provision tied to sales targets.
- Other exposures: Approximately 75% of FY2024 materials were purchased from one vendor. The company cites dependence on third-party manufacturers, competition, clinical and regulatory uncertainty, foreign exchange exposure, and potential disruption from conflict in Israel. It reported no material cybersecurity incidents to date.
- Subsequent events: In June 2024, the company amended the Avenue loan in exchange for additional warrants and fees. It also sued Airgas, alleging breach of contract and seeking $50 million in damages and equitable relief; Airgas had not appeared in the action as of the filing.
The financial statements received an unqualified audit opinion, with no critical audit matters reported. Management stated that disclosure controls and internal control over financial reporting were effective as of March 31, 2024; the auditor did not provide an internal-control attestation.
Important facts for investors to verify
- Current cash runway, cash restrictions and the timing and availability of additional financing, including whether the revenue conditions for the Avenue tranche were met.
- Recent LungFit PH placements, revenue, cash collections, gross costs per device and evidence of customer adoption and reimbursement.
- Progress and timing of EU certification, the cardiac-surgery label supplement and any international commercial partnerships.
- Status, funding and next clinical milestones for VCAP, NTM, bronchiolitis, Beyond Cancer and the nNOS program.
- Actual debt principal, interest and amortization terms after the June 2024 amendment; covenant compliance and any potential dilution from outstanding warrants, options and other securities.
- Developments in the Airgas litigation, the Circassia payment and royalty obligations, and dependence on the principal materials supplier.