Daré Bioscience(DARE) - 2023 Q3 - Quarterly Report

FORM 10-Q Filing Information DARÉ BIOSCIENCE, INC. filed this Form 10-Q as a non-accelerated, smaller reporting company for the period ended September 30, 2023 - Quarterly Report on Form 10-Q for the period ended September 30, 2023[2] | Detail | Value | | :----- | :---- | | Registrant Name | DARÉ BIOSCIENCE, INC. | | State of Incorporation | Delaware | | Commission File Number | 001-36395 | | Trading Symbol | DARE | | Exchange | Nasdaq Capital Market | | Filer Status | Non-accelerated filer, Smaller reporting company | | Common Stock Outstanding (Nov 8, 2023) | 98,562,344 shares | CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Forward-looking statements in this report, especially in Item 2, are subject to substantial risks and uncertainties that could cause actual results to differ materially - The report contains forward-looking statements, especially in "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations," which are subject to substantial risks and uncertainties[6][7] - Key risk factors include inability to raise additional capital, failure to complete product development or obtain FDA approval, inability to demonstrate sufficient safety and efficacy, timely supply of products, performance of third-party collaborators, market acceptance, and macroeconomic factors[7][8][11] PART I. FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, equity, and cash flows, with detailed notes on organization, policies, agreements, and events Condensed Consolidated Balance Sheets Total assets and stockholders' equity (deficit) significantly decreased from December 31, 2022, to September 30, 2023, primarily due to reduced cash and increased accumulated deficit | Metric | September 30, 2023 (Unaudited) | December 31, 2022 | Change (Absolute) | Change (%) | | :-------------------------------- | :----------------------------- | :---------------- | :---------------- | :--------- | | Cash and cash equivalents | $13,894,424 | $34,669,605 | $(20,775,181) | -59.9% | | Total current assets | $22,435,495 | $43,038,753 | $(20,603,258) | -47.9% | | Total assets | $25,054,030 | $43,826,383 | $(18,772,353) | -42.8% | | Total current liabilities | $26,342,770 | $31,623,927 | $(5,281,157) | -16.7% | | Total liabilities | $27,342,770 | $32,714,273 | $(5,371,503) | -16.4% | | Total stockholders' equity (deficit) | $(2,288,740) | $11,112,110 | $(13,400,850) | -120.6% | Condensed Consolidated Statements of Operations and Comprehensive Loss The company reported a net loss of $8.3 million for Q3 2023 and $25.1 million for the nine months ended September 30, 2023, significantly higher than prior periods due to decreased license fee revenue and increased operating expenses | Metric | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | Change (Absolute) | Change (%) | | :-------------------------------- | :-------------------------- | :-------------------------- | :---------------- | :--------- | | License fee revenue | $1,000,000 | $0 | $1,000,000 | N/A | | Total operating expenses | $9,396,415 | $7,138,793 | $2,257,622 | 31.6% | | Net loss | $(8,299,096) | $(7,019,843) | $(1,279,253) | 18.2% | | Loss per common share - basic and diluted | $(0.09) | $(0.08) | $(0.01) | 12.5% | | Metric | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | Change (Absolute) | Change (%) | | :-------------------------------- | :-------------------------- | :-------------------------- | :---------------- | :--------- | | License fee revenue | $1,000,000 | $10,000,000 | $(9,000,000) | -90.0% | | Total operating expenses | $26,768,420 | $25,154,921 | $1,613,499 | 6.4% | | Net loss | $(25,103,829) | $(15,004,515) | $(10,099,314) | 67.3% | | Loss per common share - basic and diluted | $(0.29) | $(0.18) | $(0.11) | 61.1% | Condensed Consolidated Statements of Stockholders' Equity (Deficit) Stockholders' equity shifted from a $11.1 million positive balance to a $2.3 million deficit by September 30, 2023, primarily due to a $25.1 million net loss, partially offset by common stock issuance proceeds | Metric | December 31, 2022 | September 30, 2023 | Change (Absolute) | | :-------------------------------- | :---------------- | :---------------- | :---------------- | | Total stockholders' equity (deficit) | $11,112,110 | $(2,288,740) | $(13,400,850) | | Common stock shares outstanding | 84,825,481 | 98,292,344 | 13,466,863 | | Accumulated deficit | $(141,074,640) | $(166,178,469) | $(25,103,829) | - Issuance of common stock and warrants, net of issuance costs, contributed $8.1 million to additional paid-in capital during the nine months ended September 30, 2023[18] Condensed Consolidated Statements of Cash Flows For the nine months ended September 30, 2023, the company experienced a $30.7 million net cash outflow from operating activities, partially offset by $10.3 million from financing activities, resulting in a $20.4 million net decrease in cash | Cash Flow Activity | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | Change (Absolute) | Change (%) | | :-------------------------------- | :-------------------------- | :-------------------------- | :---------------- | :--------- | | Net cash used in operating activities | $(30,677,749) | $(12,191,757) | $(18,485,992) | 151.6% | | Net cash used in investing activities | $(22,099) | $(60,372) | $38,273 | -63.4% | | Net cash provided by financing activities | $10,327,852 | $1,343,355 | $8,984,497 | 668.8% | | Net change in cash, cash equivalents and restricted cash | $(20,440,181) | $(11,284,541) | $(9,155,640) | 81.1% | - Financing activities in 2023 were significantly boosted by $8.6 million from the issuance of common stock and warrants and $1.3 million from warrant exercises[23] Notes to Condensed Consolidated Financial Statements (Unaudited) The notes provide critical context to the financial statements, detailing the company's business, significant accounting policies (including the going concern warning), revenue recognition practices, and specifics of strategic agreements, equity transactions, stock-based compensation, lease obligations, commitments, grant awards, net loss per share, and subsequent events Note 1. Organization and Description of Business Daré Bioscience, Inc. is a biopharmaceutical company focused on women's health, developing innovative products across contraception, vaginal health, reproductive health, menopause, sexual health, and fertility, with its first FDA-approved product, XACIATO, beginning commercial sale in October 2023 through a licensing agreement with Organon - Daré Bios