BioCardia, Inc. — Q1 2018 Form 10-Q
Reporting period: Three months ended March 31, 2018. Financial statements are unaudited. BioCardia is a clinical-stage regenerative medicine company developing cardiovascular cell therapies and enabling medical devices.
Financial performance and liquidity
Amounts are in thousands of dollars, except per-share data.
| Metric | Q1 2018 | Q1 2017 / comparison |
|---|---|---|
| Total revenue | $199 | $137 |
| Net product revenue | $82 | $109 |
| Collaboration agreement revenue | $117 | $28 |
| Cost of goods sold | $157 | $175 |
| Research and development | $1,955 | $1,033 |
| Selling, general and administrative | $1,707 | $1,804 |
| Operating loss | $(3,620) | $(2,875) |
| Net loss | $(3,584) | $(2,876) |
| Basic and diluted loss per share | $(0.09) | $(0.08) |
| Cash used in operating activities | $(3,036) | $(2,278) |
- Revenue increased $62, or approximately 45%, primarily from higher collaboration revenue; the company attributed the increase in part to adopting Topic 606. Product revenue declined $27.
- R&D expense rose $922, primarily reflecting the CardiAMP Heart Failure Trial and CardiALLO development. Management expects R&D spending to continue increasing.
- Cash and cash equivalents were $9,653 at March 31, down from $12,689 at December 31, 2017. Total assets were $10,411 and total liabilities were $2,204. The balance sheet lists no debt balance.
- Accumulated deficit was $75,988. No operating margin or cash-flow margin was stated in the filing; the company reported an operating loss and negative operating cash flow.
Programs, outlook, and risks
- The Phase III CardiAMP Heart Failure Trial was enrolling at 13 centers. Management anticipated efficacy results from the open-label roll-in cohort in the second half of 2018 and trial enrollment completion in the first half of 2019.
- In January 2018, the FDA approved a second IDE for a CardiAMP pivotal trial in chronic myocardial ischemia, planned for up to 343 patients at up to 40 U.S. sites. Management expected to submit a CardiALLO Phase II IND in 2018.
- CMS designated both CardiAMP trials for Medicare national coverage; the company anticipated coverage for specified trial-related costs. This does not constitute product approval or commercial revenue.
- Management estimated that March 31 cash would fund operations into Q4 2018, and said additional capital would be required to continue development beyond then. The filing states there is substantial doubt about the company’s ability to continue as a going concern beyond one year from issuance of the financial statements.
- The company plans to seek additional funding, potentially through debt or equity. Funding may not be available on acceptable terms; equity or convertible financing may dilute shareholders, and other arrangements could limit flexibility or require relinquishing rights. If funding is inadequate, the company may cut costs, delay development, or cease operations.
- Management expects modest product-sales growth in 2018 and moderately higher R&D and, later in the year, SG&A expenses. These are expectations, not guarantees. The company does not expect therapeutic-candidate revenue before regulatory approval.
- Other items: Topic 606 adoption had no material financial-statement impact; no material market-risk changes or off-balance-sheet arrangements were reported. Management said disclosure controls were effective and reported no material change in internal control over financial reporting.
Important facts for investors to verify
- Whether BioCardia raised sufficient capital after the filing to address the stated Q4 2018 funding horizon and going-concern uncertainty.
- Actual CardiAMP trial enrollment, timing of roll-in results, and progress of the chronic myocardial ischemia trial and CardiALLO IND.
- Whether collaboration revenue is recurring and how Topic 606 affected the timing or amount of reported revenue.
- Subsequent cash use, financing terms, potential dilution, and any changes in operating plans or trial costs.
- Any subsequent regulatory, clinical, reimbursement, or legal developments; the filing reported no currently pending legal proceeding believed material.