BioVie Inc. — Form 10-Q Summary
Reporting period: The filing covers the quarter and nine months ended March 31, 2022, BioVie’s fiscal third quarter of 2022—not 2021 Q3 as stated in the request metadata. Filed May 11, 2022. BioVie is a clinical-stage drug developer and reported no revenue.
Financial performance and liquidity
| Metric | Three months ended March 31, 2022 | Nine months ended March 31, 2022 |
|---|---|---|
| Revenue | None | None |
| Operating expenses | $5.75 million | $17.96 million |
| Net loss | $7.04 million | $18.00 million |
| Net loss per share, basic and diluted | $0.28 | $0.73 |
| Net cash used in operating activities | $13.13 million for the nine months |
At March 31, 2022, cash was $24.51 million, working capital approximately $20.5 million, total assets $26.19 million, total liabilities $16.23 million, and stockholders’ equity $9.95 million. Accumulated deficit was $242.88 million. The filing does not provide a meaningful revenue or operating margin because the company has no revenue.
Financing provided $33.12 million of net cash during the nine months, including $18.51 million net proceeds from common-stock issuance and $14.61 million net proceeds from a loan. Cash increased from $4.51 million at June 30, 2021 to $24.51 million at March 31, 2022.
The company borrowed $15 million from Avenue in November 2021; the balance-sheet carrying value was $11.62 million after discounts, financing costs, and premium accounting. The loan bears interest at the greater of prime plus 7% or 10.75%, has a December 2024 maturity, and is secured by company assets, including intellectual property. Its effective interest rate is reported as 25%. Up to a further $5 million is contingent on clinical milestones. Lenders may convert up to $5 million of principal into shares at $6.98 per share.
Changes versus prior comparable periods
- Quarterly net loss rose from $2.99 million to $7.04 million. Operating expenses increased by about $2.75 million, chiefly from research and development; interest expense and derivative-liability fair-value changes also contributed.
- Nine-month results shifted from $1.28 million net income to an $18.00 million net loss. Operating expenses rose from $6.45 million to $17.96 million, led by expanded clinical programs and operations following the June 2021 NeurMedix asset acquisition.
- Nine-month operating cash use increased from $3.44 million to $13.13 million. Prior-year reported income included an $8.28 million gain from changes in derivative fair values and a $53.60 million deemed dividend that affected loss attributable to common stockholders.
- Common shares outstanding increased from 22.33 million at June 30, 2021 to 24.98 million at March 31, 2022. The company also has outstanding options, warrants, a lender conversion feature, and potential milestone shares.
Outlook, risks, and unusual items
- Clinical programs: BIV201’s Phase 2b trial for refractory ascites was active at 10 of 13 planned U.S. centers; top-line results were expected in early 2023. NE3107’s Alzheimer’s Phase 3 trial was underway, with results targeted for the first half of 2023. Its Parkinson’s Phase 2 study began in January 2022, with results expected in mid-2022.
- Funding and going concern: Management said cash might support operations for 12 months only if planned research spending and clinical progress were curtailed; under current plans, projected cash was expected to be depleted within that period. The filing states that substantial doubt exists about the company’s ability to continue as a going concern. Additional financing is not assured.
- Development and execution risks: Clinical outcomes, regulatory approvals, trial enrollment and timing, competition, and access to capital could materially affect the business. The company cited COVID-19-related labor shortages and potential effects on trial participation and financing access.
- Dilution and related-party transaction: The NeurMedix asset agreement may require up to 18 million additional shares upon specified milestones. NeurMedix and Acuitas were related-party affiliates. The Avenue loan also includes warrants and a conversion option accounted for as derivative liabilities.
- Other items: The filing reports a 2019 USPTO decision revoking all claims of the company’s ’945 patent; BioVie says this does not change its orphan-drug designations or rights in a separate pending patent application. No material legal proceedings were reported. Management stated disclosure controls were effective and reported no material changes in internal control over financial reporting.
Key facts investors should verify
- Whether cash burn and available financing support planned operations, and the assumptions behind the stated 12-month funding outlook.
- Progress, enrollment, timing, and results for the BIV201, Alzheimer’s, and Parkinson’s trials.
- The Avenue loan’s interest, collateral, milestone conditions for additional borrowing, conversion terms, and potential dilution.
- The potential share issuance under the NeurMedix agreement, outstanding equity awards, and related-party disclosures.
- The status and scope of intellectual-property protection, including the revoked ’945 patent and pending terlipressin patent application.