BioVie(BIVI) - 2021 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements The company's financial position significantly improved in Q3 2020 due to a public offering, leading to increased cash, positive equity, and net income from derivative liability extinguishment Condensed Balance Sheets The balance sheet significantly strengthened by September 30, 2020, with cash increasing to over $13.1 million and stockholders' equity turning positive due to liability reduction Condensed Balance Sheet Highlights (Unaudited) | Metric | Sep 30, 2020 | Jun 30, 2020 | Change | | :--- | :--- | :--- | :--- | | Assets | | | | | Cash | $13,195,562 | $37,195 | +$13,158,367 | | Total Current Assets | $13,247,756 | $412,980 | +$12,834,776 | | Total Assets | $14,861,349 | $2,083,917 | +$12,777,432 | | Liabilities & Equity | | | | | Total Current Liabilities | $203,174 | $23,520,053 | -$23,316,879 | | Total Liabilities | $265,674 | $23,582,553 | -$23,316,879 | | Total Stockholders' Equity (Deficit) | $14,595,675 | ($21,498,636) | +$36,094,311 | Condensed Statements of Operations The company reported a net income of $7.3 million for Q3 2020, driven by a non-cash gain on derivative liabilities, despite a large deemed dividend impacting common stockholders Condensed Statement of Operations (Unaudited, Three Months Ended Sep 30) | Metric | 2020 | 2019 | Change | | :--- | :--- | :--- | :--- | | Total Operating Expenses | $386,755 | $706,218 | -$319,463 | | Loss from Operations | ($386,755) | ($706,218) | +$319,463 | | Change in fair value of derivative liabilities | ($8,279,919) | ($362,586) | -$7,917,333 (Income) | | Net Income (Loss) | $7,333,916 | ($3,821,227) | +$11,155,143 | | Deemed dividends – Related party | $53,598,320 | $17,099,058 | +$36,499,262 | | Net Loss Attributable to Common Stockholders | ($46,264,404) | ($20,920,285) | -$25,344,119 | | Net Loss Per Common Share - Basic & Diluted | ($7.75) | ($5.06) | -$2.69 | Condensed Statements of Cash Flows Net cash used in operations increased to $1.1 million, but financing activities, primarily a $15.6 million stock issuance, boosted cash by $13.2 million Condensed Statement of Cash Flows (Unaudited, Three Months Ended Sep 30) | Metric | 2020 | 2019 | | :--- | :--- | :--- | | Net cash used in operating activities | ($1,083,825) | ($590,914) | | Net cash provided by financing activities | $14,242,192 | $500,000 | | Net increase (decrease) in cash | $13,158,367 | ($90,914) | | Cash, end of period | $13,195,562 | $249,009 | Condensed Statements of Changes in Stockholders' Equity/(Deficit) Stockholders' equity shifted from a $21.5 million deficit to a $14.6 million positive balance, driven by stock issuance and warrant redemption, offset by a large deemed dividend - The company's equity position shifted from a deficit of ($21,498,636) at the beginning of the quarter to a positive balance of $14,595,675 at the end[18] - Key financing activities included raising $15.6 million from a common stock issuance and a $13.1 million related-party warrant redemption[18] - A significant non-cash deemed dividend of $53,598,320 was recorded, which increased additional paid-in capital but also increased the accumulated deficit[18] Notes to Unaudited Condensed Financial Statements Notes detail the company's BIV201 focus, improved liquidity from a $15.6 million public offering, key accounting policies, related-party transactions, and commitments Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses BIV201 development, Q3 2020 net income driven by derivative gains, reduced operating expenses, and enhanced liquidity from a $15.6 million public offering - The company's net income of $7.3 million for the quarter was primarily due to a $7.9 million positive change in the fair value of derivative liabilities and a $2.9 million decrease in interest expense[83] - Research and development expenses decreased by approximately $241,000 year-over-year as activities were minimized while the company focused on its public offering[85] - Following a public offering that raised approximately $15.6 million in net proceeds, management believes it has sufficient funds for operations through at least November 2021[88][91] - The public offering enabled the company to reduce total liabilities by $23.3 million, from $23.6 million on June 30, 2020, to approximately $256,000 on September 30, 2020[90] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section is not applicable to the company - The company states that this item is not applicable[97] Item 4. Controls and Procedures Management concluded disclosure controls were effective as of September 30, 2020, with no material changes to internal controls during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2020[98] - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[99] PART II – OTHER INFORMATION Item 1. Legal Proceedings The company is not a party to any material legal proceedings, nor are any officers or directors - The company is not a party to any material legal proceedings[99] Item 1A. Risk Factors This item is not applicable as the company is a smaller reporting company - This item is not applicable to smaller reporting companies[100] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds All sales of unregistered securities during the quarter were previously disclosed on a Form 8-K - Any sales of unregistered securities during the quarter were previously disclosed on a Form 8-K[100] Item 3. Defaults Upon Senior Securities None - None[100] Item 4. Mine Safety Disclosures None - None[100] Item 5. Other Information None - None[100] Item 6. Exhibits This section provides an index of exhibits, including certifications from the Chief Executive Officer and Chief Financial Officer and Interactive Data Files (XBRL documents) - The report includes certifications from the Chief Executive Officer and Chief Financial Officer as required by the Sarbanes-Oxley Act[101] - Interactive Data Files (XBRL documents) are also included as exhibits[101]