BioCardia, Inc. — FY2018 Form 10-K
Reporting period: Fiscal year ended December 31, 2018. The filing is an annual report, not a standalone fourth-quarter report; it does not provide clear Q4-only financial results.
Business context
BioCardia is a clinical-stage regenerative medicine company developing cardiovascular cell therapies. Its lead candidate, investigational CardiAMP, is being studied for heart failure following a heart attack and chronic myocardial ischemia. CardiALLO, an investigational donor-derived “off-the-shelf” therapy, is in development. The company also sells Morph vascular-access products and provides delivery systems and support to research and clinical partners.
Financial performance and liquidity
| Metric | 2018 | 2017 |
|---|---|---|
| Total revenue | $625,000 | $479,000 |
| Net product revenue | $282,000 | $389,000 |
| Collaboration revenue | $343,000 | $90,000 |
| Cost of goods sold | $517,000 | $690,000 |
| Research and development | $8.453 million | $5.799 million |
| Selling, general and administrative | $5.757 million | $6.395 million |
| Operating loss | $14.102 million | $12.405 million |
| Net loss | $13.987 million | $12.308 million |
| Net loss per share | $0.36 | $0.32 |
| Operating cash used | $11.069 million | $8.671 million |
| Cash and cash equivalents at year-end | $5.358 million | $12.689 million |
Gross profit was approximately $108,000 in 2018, or a 17% gross margin, compared with a $211,000 gross loss in 2017. Revenue rose about 30%, driven by collaboration revenue, while product revenue declined about 27%. Net loss widened approximately 14%, largely as R&D spending increased about 46% with execution of the CardiAMP heart-failure trial and development of CardiALLO. The filing reports no interest-bearing debt on the balance sheet; total liabilities were $2.625 million, predominantly current operating liabilities. Year-end current assets were $6.218 million and current liabilities $2.548 million.
Financing activities provided $3.804 million in 2018, principally from a December offering of 5.33 million shares and warrants for up to 2.67 million additional shares at $0.75 per share; net proceeds were $3.8 million after expenses. Common shares outstanding increased to 43.61 million at year-end. The company reported an accumulated deficit of $86.4 million and expects continuing losses and negative operating cash flow.
Material developments and outlook
- The CardiAMP heart-failure Phase III trial was enrolling at 21 sites; 32 patients had been enrolled by the filing’s discussion. Management anticipated enrollment completion in Q3 2020 and top-line results in Q3 2021, with interim readouts anticipated in Q3 2019 and Q3 2020.
- In the 10-patient open-label roll-in cohort, 12-month six-minute walk distance improved by an average of 46.4 meters (p=0.06); quality-of-life score improved 9.8 points (p=0.33). These small-cohort findings were not statistically significant. The company reported no treatment-emergent major adverse cardiac events at 30 days, one MACE-related hospitalization at nine months, and all patients alive and out of hospital at 12 months. The company cautioned that the therapy remains investigational and these results do not establish safety or efficacy.
- The FDA approved the IDE for a separate CardiAMP chronic-myocardial-ischemia pivotal trial of up to 343 patients in January 2018. CMS designated both CardiAMP pivotal trials as qualifying trials for Medicare coverage of routine trial costs. Activation of the ischemia trial was described as possible in 2019 subject to additional funding.
- Management aimed to obtain FDA acceptance of the CardiALLO Phase I/II trial IND in Q2 2019. The filing also reported a Q4 2018 CellProThera collaboration for a Singapore trial; CellProThera is to fund the clinical and regulatory work, with BioCardia eligible for double-digit royalties on future Singapore sales if approved.
- Management said existing cash was insufficient to fund planned operations beyond Q2 2019 and that substantial doubt existed about the company’s ability to continue as a going concern within one year after issuance of the financial statements. Additional financing was required; no assurance was given it would be available on acceptable terms. Without funding, the company may cut or delay programs, relinquish rights, or cease operations.
- BioCardia reported that CE Mark certification for its catheter products expired April 1, 2019 because of delay in meeting the updated ISO quality standard. It expected compliance during 2019 and said European sales would be suspended until certification renewal; management did not expect a material impact, citing modest European Morph sales and partner planning.
Key risks, contingencies, and other items
- Clinical and regulatory outcomes remain uncertain: no cell-based therapy for a cardiac indication had been FDA-approved in the United States, and FDA acceptance of trial designs does not guarantee approval or success based on a single pivotal study.
- Funding needs, trial enrollment and execution, manufacturing scale-up, third-party supplier and collaborator performance, reimbursement, market adoption, competition, and intellectual-property protection are significant risks.
- The December financing was dilutive and included warrants exercisable through 2023; additional equity or debt financing could further dilute shareholders or impose restrictive terms.
- The company disclosed no material pending legal proceedings. The independent auditor gave an unqualified opinion on the financial statements while emphasizing the going-concern uncertainty.
- No formal financial guidance was provided. Management’s clinical timelines and operating expectations are forward-looking estimates, not guarantees.
Most important facts for investors to verify
- Current cash, subsequent financing, cash burn, and whether funding covers trial commitments and operations.
- Enrollment progress, interim analyses, endpoint definitions, statistical results, and safety adjudication for both CardiAMP pivotal trials.
- Whether and when the chronic-ischemia trial is activated and the CardiALLO IND is accepted.
- CE Mark renewal status and the effect of the European catheter-sales interruption.
- Fully diluted share count, including outstanding options and the 2.67 million offering warrants, and any further financing terms.