Dyadic International, Inc. — FY2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022; comparisons are with FY2021. This is an annual filing, not a standalone fourth-quarter report.
Business context
Dyadic is a biotechnology platform company developing its C1 fungal protein-production platform for human and animal health applications and its Dapibus platform for food, nutrition, and wellness. It has no pharmaceutical products approved for sale and relies on collaborations, grants, licensing, and investment income.
Financial performance and liquidity
| Metric | FY2022 | FY2021 |
|---|---|---|
| Total revenue | $2.93 million | $2.40 million |
| Research and development revenue | $2.68 million | $2.40 million |
| License revenue | $247,000 | None reported |
| Research revenue costs | $2.12 million | $1.94 million |
| Research and development expense | $4.50 million | $8.39 million |
| General and administrative expense | $6.42 million | $6.70 million |
| Operating loss | $10.17 million | $14.73 million |
| Net loss | $9.74 million | $13.07 million |
| Basic and diluted loss per share | $0.34 | $0.47 |
| Net cash used in operating activities | $8.08 million | $11.28 million |
Revenue increased approximately 22%; the contribution from research and development revenue after its reported costs was $560,000. The filing does not provide a single overall gross-margin figure. Interest income was $180,000, and other income was $250,000, including a settlement payment. FY2021 other income included a $1.61 million gain on the sale of BDI investments.
At year-end, cash and cash equivalents were $5.79 million, short-term investment securities were $6.85 million, and current assets totaled $13.42 million against current liabilities of $2.45 million. Total liabilities were $2.63 million; the filing reports no debt balance. Stockholders’ equity was $11.09 million. Cash and cash equivalents declined from $15.75 million at FY2021 year-end. The company reported that available cash and investment-grade securities were expected to meet liquidity needs for at least 12 months.
Changes, outlook, and material items
- Net loss narrowed by about $3.34 million, primarily as R&D expense fell by $3.89 million; revenue growth and lower G&A also helped, partly offset by lower other income.
- R&D expense fell largely because clinical-development consulting and cGMP manufacturing activity decreased as the DYAI-100 Phase 1 trial moved toward dosing.
- DYAI-100 Phase 1 dosing was completed in February 2023, after year-end. No serious adverse events had been reported as of the filing, and a full study report was expected in the second half of 2023. The vaccine remains investigational.
- The Janssen collaboration includes up to €1.6 million in R&D funding and potential option, development, regulatory, and commercial milestones; these potential payments are contingent and are not assured.
- A food-ingredient joint development agreement provides for approximately $4.1 million of funded research over two years, plus potential success fees, a commercialization fee, and royalties. The agreement is terminable on notice.
- In January 2023, Dyadic sold its Alphazyme equity interest for approximately $1.27 million net of adjustments and legal expenses; possible future payments tied to product sales remain. This is a subsequent event, not FY2022 cash flow.
- Management did not provide quantified financial guidance. It did not expect significant additional capital to support DYAI-100 development, manufacturing, and testing in 2023 and beyond, while continuing to identify collaboration and financing needs.
- Commitments for purchased services totaled approximately $3.12 million at year-end, primarily CRO research services; the VTT research contract runs through December 2023. Cash burn, continued losses, reliance on a small number of collaborations, CRO dependence, regulatory and clinical uncertainty, and potential future equity financing are key risks.
Important facts for investors to verify
- Whether DYAI-100 Phase 1 results, including safety and antibody-response data, were reported as expected and support further development.
- Whether collaboration research funding converts into milestones, licenses, royalties, or commercial revenue; the company had not recognized sublicense milestone or royalty revenue to date.
- Current cash, securities, operating cash burn, and financing runway, including the effect of the post-year-end Alphazyme proceeds.
- The timing, funding, and termination terms of CRO, Janssen, Phibro/Abic, and food-ingredient programs, as well as the concentration of research spending among CROs.
- Potential dilution: Dyadic had an at-the-market facility of up to $50 million, although no shares had been sold under it as of the filing. The filing also reports 5.03 million options outstanding at December 31, 2022.
- The auditor issued an unqualified opinion on the financial statements and reported no critical audit matters. Management judged disclosure controls and internal control over financial reporting effective; the auditor did not provide an internal-control attestation because Dyadic is a smaller reporting company.