BioVie Inc. — Form 10-K Summary
Reporting period: Fiscal year ended June 30, 2022, not calendar 2021 Q4. The audited financial statements compare fiscal 2022 with fiscal 2021. BioVie is a clinical-stage biopharmaceutical company with no approved products and no product revenue.
Business context and programs
- BIV201: Continuous-infusion terlipressin in development for refractory ascites associated with advanced liver cirrhosis. Its randomized, 30-patient Phase 2b trial was enrolling at 11 U.S. centers; top-line results were expected in mid-2023. The FDA has granted Fast Track and Orphan Drug designations for ascites, and Orphan Drug designation for hepatorenal syndrome.
- NE3107: Oral drug candidate acquired from related party NeurMedix in 2021. A potentially pivotal Phase 3 Alzheimer’s trial began in August 2021, with primary completion targeted for mid-2023. A Phase 2 Parkinson’s study began in January 2022; top-line results were expected by year-end 2022.
Financial results and liquidity
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue | None | None |
| Research and development expense | $17.3 million | $2.5 million |
| Selling, general and administrative expense | $9.8 million | $4.6 million |
| Total operating expenses | $27.3 million | $138.1 million |
| Net loss | $26.1 million | $130.2 million |
| Net cash used in operations | $19.0 million | $10.5 million |
- The lower reported net loss primarily reflects the prior-year $130.6 million in-process R&D charge for the NeurMedix asset acquisition. FY2022 R&D increased about $14.8 million, reflecting neuroscience trials, BIV201 development, and an expanded clinical team.
- Cash was $18.6 million at June 30, 2022, versus $4.5 million a year earlier. Working capital was approximately $14.6 million; stockholders’ equity was $3.7 million and accumulated deficit was $251.0 million.
- Cash from financing was $33.1 million, including $18.5 million net proceeds from stock issuance and $14.6 million net proceeds from the loan. Cash increased $14.1 million over the year.
- At June 30, 2022, the company had $15 million principal outstanding under its Avenue loan, carried at $12.1 million net of financing costs and discounts. Interest is the greater of prime plus 7% or 10.75%; the filing reports a 25% adjusted effective rate. Up to $5 million in a second tranche was conditional on clinical milestones.
- Margins are not meaningful because the company had no revenue. Management expected cash to be depleted within 12 months under its planned program, absent additional financing or changes in spending; it stated that slowing planned clinical expenditures could extend runway. The auditor identified substantial doubt about the company’s ability to continue as a going concern.
Changes, outlook, and risks
- Operating expenses fell substantially from FY2021 because that year included the related-party NeurMedix acquisition charge; excluding this unusual item, FY2022 reflected materially higher ongoing R&D and SG&A spending.
- Subsequent to year-end, the company closed a $6 million private placement with Acuitas on August 15, 2022, issuing 3.64 million shares and a five-year warrant for 7.27 million shares at $1.82, subject to a down-round feature. It also entered an at-the-market sales agreement; by September 12, 2022, it had received $5.9 million net from 1.54 million shares sold.
- Management’s plans depend on further equity or debt financing, partnerships, licensing, or other strategic transactions. It acknowledged that available funds may be insufficient to complete all planned studies and that programs could be delayed, reduced, or stopped if financing is unavailable.
- Key risks include clinical-trial failure or delay, regulatory uncertainty, competition, dependence on third-party manufacturing, COVID-related enrollment and supply disruptions, and the lack of revenue. Additional dilution is possible, including up to 18 million contingent shares under the NeurMedix asset purchase agreement. Acuitas is a related party and controlling shareholder; the filing describes related-party financing and asset transactions.
- The company reported effective management disclosure controls and internal control over financial reporting; the auditor did not audit or opine on internal control. No material legal proceedings were reported.
Important facts for investors to verify
- Current cash runway, financing needs, and the status and terms of any additional Avenue loan tranche.
- Enrollment, completion timing, safety data, and results for the BIV201 and NE3107 trials, including the Parkinson’s study whose results were expected by year-end 2022.
- How subsequent equity and warrant issuances affect the share count, ownership concentration, and potential dilution.
- The economic and governance implications of related-party transactions, the Acuitas financing, and the contingent NE3107 milestone shares.
- The company’s ability to maintain operations as a going concern, given recurring losses, negative operating cash flow, and no product revenue.