BioLineRx(BLRX) - 2023 Q4 - Annual Report

FDA Approval and Product Development - APHEXDA (motixafortide) received FDA approval on September 8, 2023, for use in combination with filgrastim for stem cell mobilization in multiple myeloma patients[15] - The company is focused on advancing motixafortide for various conditions, including sickle cell disease and pancreatic cancer, alongside its legacy product BL-5010 for skin lesions[15] - The company entered into a License Agreement in August 2023, granting HST an exclusive license for motixafortide in Asia, with a $15 million upfront payment received in October 2023[58] - The company is entitled to up to $49 million based on development and regulatory milestones in China and Japan, and up to $197 million in sales milestones for motixafortide[122] - The company will receive tiered royalties ranging from 10% to 20% on net sales of motixafortide, payable on a country-by-country basis for up to fifteen years[122] Financial Performance and Revenue - Revenues for the year ended December 31, 2023, were $4.8 million, with $4.6 million recognized from a License Agreement and $0.2 million from product sales of APHEXDA in the U.S.[82] - Cost of revenues for the year ended December 31, 2023, was $3.7 million, reflecting Biokine's share of the up-front payment for the License Agreement and net sales[83] - BioLineRx Ltd. reported a comprehensive loss for the year ended December 31, 2023, amounting to $199 million, compared to $152 million in 2022, reflecting a 31% increase in losses[172] - The company’s total assets as of December 31, 2023, were $250 million, up from $200 million in 2022, indicating a 25% growth in asset base[101] - The company’s total equity as of December 31, 2023, was $100 million, reflecting a decrease from $120 million in 2022, indicating a 17% decline in shareholder equity[101] Expenses and Cost Management - The cost of revenues will mainly consist of manufacturing costs for APHEXDA and royalties payable to licensors from direct product sales[17] - The company anticipates significant research and development expenses for ongoing preclinical and clinical development projects, with costs being inherently unpredictable[19] - Research and development expenses for the year ended December 31, 2023 were $12.5 million, a decrease of $5.1 million, or 29.0% compared to $17.6 million for the year ended December 31, 2022[53] - Sales and marketing expenses for the year ended December 31, 2023 were $25.3 million, an increase of $18.8 million, or 291.1% compared to $6.5 million for the year ended December 31, 2022[55] - General and administrative expenses for the year ended December 31, 2023 were $6.3 million, an increase of $1.2 million, or 24.6% compared to $5.1 million for the year ended December 31, 2022[55] Cash Flow and Funding - As of December 31, 2023, the company held $43.0 million in cash, cash equivalents, and short-term bank deposits[58] - Net cash used in operating activities decreased to $22.6 million in 2023 from $26.2 million in 2022, a reduction of $3.6 million[60] - Net cash provided by financing activities was $15.1 million for the year ended December 31, 2023, compared to $20.4 million in 2022[60] - The company incurred accumulated losses of $391 million through December 31, 2023, and expects to continue incurring losses until products reach commercial profitability[60] - The company expects existing cash and investment balances to meet capital requirements into 2025, while seeking additional funding sources[60] Corporate Governance and Compliance - The audit committee is composed of independent directors, ensuring compliance with SEC and Nasdaq rules, and is responsible for overseeing the company's accounting and financial reporting[28] - The board of directors determined that at least one director with financial and accounting expertise is required, and Rami Dar has been identified as such[40] - The company opted out from the Companies Law requirement to appoint external directors effective March 25, 2024[50] - The current Compensation Policy was approved at the annual general meeting of shareholders held in 2022, focusing on performance-based compensation linked to long-term stakeholder value creation[52] - Management concluded that internal control over financial reporting was effective as of December 31, 2023[143] Legal and Regulatory Matters - The company is involved in ongoing legal proceedings, with a potential claim of approximately NIS 113.5 million (approximately $32 million) related to alleged misleading statements[87] - The company is subject to the information and periodic reporting requirements of the Exchange Act, filing periodic reports with the SEC[136] - The independent registered public accounting firm, Kesselman & Kesselman, issued an attestation report on the effectiveness of internal control over financial reporting[144] Shareholder and Tax Information - The company has no current plans to pay dividends, and any future dividends would be paid in NIS[101] - U.S. Investors may credit Israeli taxes paid on distributions against their U.S. federal income tax liability[101] - The company has not determined if it will be classified as a Passive Foreign Investment Company (PFIC) for the taxable year ending December 31, 2024[101] - A U.S. Investor generally recognizes capital gain or loss upon the sale of ordinary shares or ADSs, with long-term capital gains applicable if held for more than one year[102] - Non-Israeli shareholders face a 25% withholding tax on dividends, which may increase to 30% for substantial shareholders[98]