Bone Biologics (BBLG) - 2024 Q2 - Quarterly Report

PART I – FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis Financial Statements Bone Biologics, a development-stage medical device company, reported no revenue, a reduced net loss, and a going concern warning Unaudited Condensed Consolidated Balance Sheets The balance sheet highlights key financial positions including cash, total current assets, liabilities, and accumulated deficit Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Assets | | | | Cash | $2,332,068 | $3,026,569 | | Total current assets | $3,193,464 | $3,737,763 | | Liabilities & Equity | | | | Total current liabilities | $284,507 | $831,402 | | Total stockholders' equity | $2,908,957 | $2,906,361 | | Accumulated deficit | $(82,558,661) | $(80,908,958) | Unaudited Condensed Consolidated Statements of Operations The statement of operations details revenues, R&D, G&A expenses, leading to loss from operations and net loss Condensed Consolidated Statements of Operations (Unaudited) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $0 | $0 | $0 | $0 | | Research and development | $350,442 | $2,295,251 | $596,067 | $4,885,896 | | General and administrative | $459,223 | $744,617 | $1,117,135 | $1,301,509 | | Loss from operations | $(809,665) | $(3,039,868) | $(1,713,202) | $(6,187,405) | | Net Loss | $(783,733) | $(1,769,238) | $(1,649,703) | $(5,479,137) | | Loss per share | $(0.67) | $(5.21) | $(1.80) | $(18.57) | Unaudited Condensed Consolidated Statements of Stockholders' Equity This statement outlines changes in stockholders' equity, including impacts from net loss, public offerings, and warrant exercises - For the six months ended June 30, 2024, total stockholders' equity slightly increased from $2,906,361 to $2,908,957. This was driven by proceeds from a public offering and warrant exercises, which were largely offset by the net loss for the period[16] - In March 2024, the company raised approximately $1.5 million (net of offering costs) from the sale of common stock and pre-funded warrants[16][56] Unaudited Condensed Consolidated Statements of Cash Flows The cash flow statement summarizes cash used in operating activities, provided by financing, and net decrease in cash Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(2,199,276) | $(4,982,666) | | Net cash provided by financing activities | $1,504,775 | $4,452,163 | | Net decrease in cash | $(694,501) | $(530,503) | | Cash, end of period | $2,332,068 | $7,007,809 | Notes to Unaudited Condensed Consolidated Financial Statements Key notes include details on reverse stock splits, warrant liabilities, license obligations, and subsequent events - The company executed two reverse stock splits: a 1-for-30 split on June 5, 2023, and a 1-for-8 split on December 20, 2023. All share and per-share amounts have been retroactively restated[30] - The company has a warrant liability of $7,655 as of June 30, 2024, which is classified as a liability and re-measured at fair value each reporting period due to certain provisions in the warrants issued in October 2022[42][51] - Under the license agreement with UCLA TDG, the company is obligated to make milestone payments, including $100,000 upon enrollment of the first subject in a Feasibility Study, which was triggered during the six months ended June 30, 2024[75][77] - Subsequent to the quarter end, on August 2, 2024, the company completed a warrant inducement transaction, generating net proceeds of approximately $1.7 million[28][80] - The company is a medical device firm focused on bone regeneration using the NELL-1 protein, licensed exclusively from UCLA TDG. Its product is classified as a device/drug combination product requiring FDA pre-market approval[23] - The company has incurred an accumulated deficit of approximately $82.6 million since inception and has not generated any revenue. These factors, along with a net loss of $1.6 million and $2.2 million cash used in operations in the first six months of 2024, raise substantial doubt about its ability to continue as a going concern[26] Management's Discussion and Analysis of Financial Condition and Results of Operations Management attributes reduced net loss to lower R&D costs; cash expected to fund operations only into Q1 2025 - On June 20, 2024, the company announced the treatment of the first patient in its multicenter, prospective, randomized pilot clinical study of the NB1 bone graft device in Australia. The study will evaluate safety and effectiveness in 30 subjects undergoing transforaminal lumbar interbody fusion (TLIF)[88][89] Comparison of Operating Expenses (Three Months Ended June 30) | Expense Category | 2024 | 2023 | % Change | | :--- | :--- | :--- | :--- | | Research and development | $350,442 | $2,295,251 | (84.73)% | | General and administrative | $459,223 | $744,617 | (38.33)% | | Total operating expenses | $809,665 | $3,039,868 | (73.37)% | Comparison of Operating Expenses (Six Months Ended June 30) | Expense Category | 2024 | 2023 | % Change | | :--- | :--- | :--- | :--- | | Research and development | $596,067 | $4,885,896 | (87.80)% | | General and administrative | $1,117,135 | $1,301,509 | (14.17)% | | Total operating expenses | $1,713,202 | $6,187,405 | (72.31)% | - The significant decrease in R&D expenses in 2024 is attributed to the high costs incurred in 2023 for the production of the NELL-1 protein required for the initial clinical study[102][107] - The company's cash of $2.3 million at June 30, 2024, supplemented by the $1.7 million from the August 2024 warrant inducement, is anticipated to cover operational needs only into the first quarter of 2025[116] Quantitative and Qualitative Disclosures about Market Risk The company has indicated that this item is not applicable - Not applicable[119] Controls and Procedures Management concluded disclosure controls and procedures were effective with no material changes to internal control - Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2024[119] - No changes occurred in the internal control over financial reporting during the quarter ended June 30, 2024, that have materially affected, or are reasonably likely to materially affect, these controls[120] PART II – OTHER INFORMATION This section provides updates on legal proceedings, risk factors, equity sales, other information, and exhibits Legal Proceedings No material updates to legal proceedings previously disclosed in the company's Annual Report on Form 10-K or Q1 2024 Form 10-Q - There are no material updates to previously disclosed legal matters[121] Risk Factors No material changes from the risk factors previously disclosed in the company's Annual Report on Form 10-K - Investors are referred to the risk factors section of the company's Annual Report on Form 10-K for the year ended December 31, 2023, as there have been no material changes[122] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None[122] Other Information No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the second quarter of 2024 - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended June 30, 2024[123] Exhibits This section lists the exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer List of Exhibits | Exhibit Number | Description | | :--- | :--- | | 31.1 | CEO Certification (Section 302) | | 31.2 | CFO Certification (Section 302) | | 32.1 | CEO Certification (Section 906) | | 32.2 | CFO Certification (Section 906) | | 101.INS - 101.PRE | Inline XBRL Documents |