BioCardia, Inc. — 2021 Form 10-K Summary
Reporting period: Fiscal year ended December 31, 2021. This is an annual filing; it does not provide standalone fourth-quarter financial results. Unless otherwise noted, financial amounts below are in U.S. dollars.
Business context
BioCardia is a clinical-stage company developing cell therapies for cardiovascular and pulmonary diseases. Its lead program, autologous CardiAMP, is in Phase III trials for heart failure following a heart attack and chronic myocardial ischemia. The company is also developing donor-derived NK1R+ mesenchymal stem cell therapies and sells or partners around enabling devices, including Morph catheters and the Helix delivery system.
Financial results and liquidity
| Metric | 2021 | 2020 |
|---|---|---|
| Revenue | $1.015 million | $145,000 |
| Research and development | $8.558 million | $9.809 million |
| Selling, general and administrative | $5.087 million | $5.861 million |
| Operating loss | $12.630 million | $15.529 million |
| Net loss | $12.623 million | $15.004 million |
| Net loss per share, basic and diluted | $0.75 | $1.48 |
| Cash used in operating activities | $10.366 million | $12.357 million |
| Cash and cash equivalents at year-end | $12.872 million | $21.407 million |
Revenue growth was driven primarily by increased collaboration activity and completion of a contract; product revenue was only $1,000, compared with $13,000 in 2020. Collaboration revenue was $1.014 million, up from $132,000. Reported gross margin is not a meaningful indicator given the very small product revenue and no cost of goods sold recorded in 2021. Lower R&D and SG&A reflected, among other factors, reduced share-based compensation and professional or clinical service costs.
At year-end, current assets were $13.481 million and current liabilities were $3.712 million. Total liabilities were $5.343 million, including operating lease liabilities; the filing reports no conventional borrowing outstanding at December 31, 2021. The $506,000 Paycheck Protection Program loan was forgiven in 2020. The company reported an accumulated deficit of $128.7 million and stated that its year-end cash was insufficient to fund planned expenditures and obligations beyond Q4 2022 without additional capital. Management and the auditor identified substantial doubt about the company’s ability to continue as a going concern.
Material changes and developments
- Net loss narrowed by about $2.4 million year over year, while operating cash use fell by about $2.0 million. Revenue increased by $870,000, largely from collaborations.
- Cash declined by $8.535 million during 2021. Financing activities provided $1.947 million, primarily from the March 2021 Lincoln Park stock purchase; only the initial $2 million purchase had been completed by year-end.
- The CardiAMP heart failure Phase III trial was active at 26 sites, with 110 patients enrolled and seven additional control patients having crossed over to treatment. The chronic ischemia Phase III trial had been activated and one patient treated.
- Both CardiAMP pivotal trials qualified for Medicare national coverage, reducing trial costs. A CMS procedure code was issued in March 2022, after the reporting year.
- In March 2022, the company submitted an IND for a Phase I/II study of its allogeneic cell therapy for COVID-19-related ARDS. Its heart failure allogeneic program was still completing preclinical work and preparing an IND submission.
- A litigation-funding settlement completed in March 2022 provided legal-fee credits and refunds totaling $688,000 and up to $300,000 in future legal-service discounts. The 2021 results included $195,000 of related legal expense. The underlying confidential litigation settlement was reported as producing no material benefit or liability.
Outlook, risks, and unusual items
Management expects operating losses and negative cash flows to continue for at least several years and anticipates needing additional financing to continue development beyond Q4 2022. Potential funding sources include equity, debt, collaborations, or licensing; none is assured. The existing Lincoln Park facility is subject to share, price, ownership, and other limitations and may not meet funding needs. Additional equity could dilute shareholders, while partnerships could require relinquishing valuable rights.
Key execution risks include pivotal-trial enrollment and outcomes, regulatory uncertainty for a novel cardiac cell therapy and its companion potency assay, manufacturing scale-up, dependence on third parties and suppliers, reimbursement and market acceptance, and competition. COVID-19 disrupted clinical-site activity and could continue to delay enrollment, studies, supply, and access to capital. The company also highlighted potential intellectual-property, product-liability, regulatory-compliance, cybersecurity, and natural-disaster risks. No current pending legal proceeding was identified as likely to have an adverse effect. A prior material weakness in financial reporting controls was reported as remediated by December 31, 2020; management assessed controls as effective at December 31, 2021, while the auditor did not provide an internal-control attestation.
For the heart failure program, the FDA granted Breakthrough Device Designation in January 2022, and the DSMB recommended continuation after its February 2022 review with no significant safety concerns. These developments occurred after fiscal year-end and do not establish efficacy or guarantee approval. The filing provides no firm revenue, profitability, or regulatory-approval guidance.
Important facts for investors to verify
- Current cash, burn rate, financing runway, and the availability and dilution implications of additional funding.
- Updated enrollment, site activity, protocol status, and eventual primary-endpoint results for both CardiAMP Phase III trials.
- Regulatory status of the CardiAMP system and companion potency assay, including whether additional pivotal evidence will be required.
- FDA response to the ARDS IND and progress toward an IND for the allogeneic heart failure program.
- Whether Medicare coverage and the CMS procedure code translate into reliable trial reimbursement and, if approved, commercial coverage.
- Terms and accounting effects of the litigation-funding settlement, and progress on the promised credits, refunds, and future legal discounts.
- Potential future share issuance under the Lincoln Park agreement and other equity plans, as well as cash concentration at one financial institution above FDIC-insured limits.