
PART I Business iBio, Inc. has transformed into a preclinical biotechnology company, leveraging its proprietary AI technology for precision antibody development, primarily in immuno-oncology Overview iBio is a preclinical biotechnology company focused on AI-driven precision antibody development after divesting its CDMO business in September 2022 - The company has transitioned into a preclinical stage biotechnology firm specializing in AI-driven development of precision antibodies13 - A strategic pivot occurred in September 2022 with the acquisition of substantially all assets from RubrYc Therapeutics, Inc., leading to the divestiture of the company's Contract Development and Manufacturing Organization (CDMO) business14 - iBio's technology stack features a patented epitope-steering AI-engine for precise targeting and a machine learning-based antibody-optimizing technology, StableHu™, to accelerate lead optimization and reduce development risks15 Strategy iBio's strategy focuses on leveraging its AI-engine for novel biologic discovery, maintaining capital efficiency through collaborations, and continuously investing in its AI platform - The company's core mission is to use AI and machine learning to discover novel biologics that have been difficult for other scientists to develop26 - iBio employs a capital-efficient approach focused on strategic collaborations, cost-effective advancement of its in-house oncology programs, and licensing its AI technology stack in other therapeutic areas like CNS or vaccines28 - A key strategic focus is the continuous investment in its AI platform to improve algorithms and models, thereby enhancing predictive power and reducing the time required to identify viable drug candidates28 AI-Technology Platform iBio's AI-powered technology stack integrates epitope steering, a human antibody library, StableHu™ AI optimization, and EngageTx™ for advanced antibody discovery and development - The technology stack comprises four key components: epitope engineering, a proprietary antibody library, StableHu AI antibody optimization, and the EngageTx T-cell engager platform3132 - The patented AI Epitope Steering Technology guides antibodies to specific, desired regions of a target protein, overcoming limitations of traditional discovery methods, particularly for complex or hard-to-drug targets36 - The StableHu™ AI technology, trained on over 1 billion human antibodies, predicts a library of humanized antibody variants to optimize efficacy and safety, and when paired with mammalian display, it accelerates the lead optimization process4246 - The EngageTx™ panel provides next-generation CD3 T-cell engagers designed to retain tumor-killing capacity while significantly reducing cytokine release, and also engineers Non-Human Primate (NHP) cross-reactivity for better preclinical safety assessment4849 Pre-Clinical Pipeline iBio's preclinical pipeline focuses on immuno-oncology with lead candidate IBIO-101 (anti-CD25 mAb) in IND-enabling stage, alongside TROP-2 x CD3 bispecific and other AI-driven antibody programs - The company's lead candidate, IBIO-101 (an anti-CD25 mAb), has advanced to the IND-enabling stage, with an IND filing projected for calendar year 202564 - The TROP-2 x CD3 bispecific antibody, developed using the EngageTx platform, demonstrated a 36% reduction in tumor size in a humanized mouse model after a single dose69 - Using its AI platform, iBio has developed antibodies targeting the non-shed region of MUC16, a well-known cancer target, to circumvent tumor evasion mechanisms75 - The company's anti-EGFRvIII antibody, targeting a tumor-specific protein variant, showed a 43% reduction in tumor growth in a mouse model for head and neck cancer86 - The anti-fibrotic program, IBIO-100, was terminated in February 2023, and the corresponding license agreement with the University of Pittsburgh ceased in August 2023102 Strategic Alliances, Collaborations, and Joint Ventures iBio engages in strategic collaborations, including a Lassa fever vaccine project with NIAID, and its transformation was driven by the RubrYc Therapeutics asset acquisition and facility divestiture - On June 12, 2023, iBio began a research collaboration with the National Institute of Allergy and Infectious Diseases (NIAID) to use its AI-driven platform for developing a Lassa fever vaccine106 - In September 2022, iBio acquired substantially all assets from RubrYc Therapeutics, including the AI Drug Discovery Platform and IBIO-101, for an upfront payment in stock and up to $5 million in potential development milestones, terminating prior licensing agreements and royalty obligations115 - The company entered into a purchase and sale agreement on September 15, 2023, to sell its Bryan, TX facility for $17.25 million, with a closing date of December 1, 2023129 - The Credit Agreement with Woodforest National Bank for the Bryan facility has been amended six times, with the maturity date now set for December 31, 2023, and repayment contingent on the facility's sale122130 Intellectual Property iBio holds 95 patents and 52 pending applications, with a shifted IP strategy focusing on preclinical assets and including 30 applications from the RubrYc acquisition - The company owns 95 patents (24 U.S., 71 international) and has 52 pending applications, with a primary focus on its preclinical antibody assets134 - The acquisition of RubrYc's assets included 30 U.S. and foreign patent applications related to novel antibodies, scaffold technology, and a machine learning apparatus135 - In the second quarter of Fiscal 2023, the company impaired intellectual property, patents, and licenses with a net book value of approximately $565,000 after a strategic review of its product portfolio137 Human Capital/Employees As of June 30, 2023, iBio had 23 full-time employees and 3 CDMO employees, maintaining competitive compensation and benefits to attract and retain key personnel - As of June 30, 2023, the company had 23 employees in iBio and 3 employees in iBio CDMO186 - The company's compensation programs are designed to be competitive and include short-term and long-term incentives, with a 401(k) plan offering a 100% match on employee contributions up to 5% of compensation192194 Risk Factors The company faces significant financial, operational, and development risks, including going concern doubts, early-stage pipeline uncertainty, and reliance on third parties and key personnel - There is substantial doubt about the company's ability to operate as a going concern due to a history of net losses, negative cash flow, and an accumulated deficit of $288.9 million as of June 30, 2023217 - The company's cash, cash equivalents, and restricted cash of $7.6 million as of June 30, 2023, are not expected to be sufficient to support operations beyond the second quarter of Fiscal 2024 without further capital raises or asset sales215 - The sale of the CDMO facility is subject to closing conditions that are not within the company's control; failure to complete the sale by the term loan's maturity date of December 31, 2023, could lead to default and potential loss of the asset242 - All of the company's product candidates are in early preclinical development and require significant, expensive, and time-consuming clinical testing before any potential regulatory approval or commercialization257 - The company recently identified and remediated a material weakness in its internal controls related to accounting for stock-based compensation, and cannot assure that future weaknesses will not occur349 Unresolved Staff Comments The company reports that it has no unresolved staff comments from the SEC - None389 Properties iBio's properties consist of its manufacturing facility in Bryan, Texas, held for sale, and a leased lab and office space in San Diego, California for R&D activities - On September 15, 2023, iBio CDMO entered into an agreement to sell its Bryan, TX facility for a purchase price of $17,250,000, with a closing date of December 1, 2023391 - The company leases approximately 11,383 square feet of lab and office space in San Diego, CA for its R&D activities; the lease commenced in September 2022 for a term of seven years and four months392 Legal Proceedings The company is not currently subject to any material legal proceedings - The company is not currently subject to any material legal proceedings393 Mine Safety Disclosures This item is not applicable to the company - Not applicable396 PART II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities iBio's common stock trades on the NYSE American under "IBIO"; the company has never paid cash dividends and effected a 1-for-25 reverse stock split in October 2022 - The company's common stock is traded on the NYSE American under the symbol "IBIO"399 - The company has never declared or paid cash dividends on its common stock400 - A 1-for-25 reverse stock split was effected on October 7, 2022; all share and per-share amounts have been retroactively adjusted402 Management's Discussion and Analysis of Financial Condition and Results of Operations iBio's financial condition reflects its transition, with a $65.0 million total net loss in FY2023 driven by discontinued CDMO operations, and substantial doubt about its going concern ability due to limited cash Results of Operations (Continuing Operations) | Metric | FY 2023 (in millions) | FY 2022 (in millions) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $0.0 | $1.9 | -100% | | R&D Expenses | $10.3 | $9.8 | +5% | | G&A Expenses | $19.0 | $21.8 | -13% | | Net Loss from Continuing Operations | ($29.3) | ($29.6) | -1% | - The loss from discontinued CDMO operations increased by 72% to ($35.7) million in FY2023, primarily due to a $17.9 million impairment of fixed assets and a $4.9 million impairment of consumable inventory433 - Total net loss available to stockholders for FY2023 was ($65.0) million, or ($5.31) per share, compared to ($50.4) million, or ($5.78) per share, in FY2022434 - Management has concluded there is substantial doubt about the company's ability to continue as a going concern; cash of $7.6 million as of June 30, 2023, is not sufficient to support operations through Q2 FY2024435440 - On September 15, 2023, the company entered an agreement to sell its Bryan, TX facility for $17.25 million, which is critical for repaying its term loan that matures on December 31, 2023422438 Quantitative and Qualitative Disclosures About Market Risk This information is not required as the company is a smaller reporting company - The information under this item is not required to be provided by smaller reporting companies492 Financial Statements and Supplementary Data This section refers to the full consolidated financial statements and supplementary data, which begin on page F-1 of the Annual Report - The company's audited financial statements and notes are included from page F-1 to F-44 of the report493 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None494 Controls and Procedures Management concluded disclosure controls were effective as of June 30, 2023, and a material weakness in stock-based compensation accounting was fully remediated - Management concluded that disclosure controls and procedures were effective as of June 30, 2023500 - A previously identified material weakness related to internal controls over accounting for stock-based compensation has been fully remediated as of June 30, 2023505506 - The Annual Report does not include an attestation report from the independent registered public accounting firm regarding internal control over financial reporting, as permitted for smaller reporting companies507 Other Information The company reports no other information under this item - None509 PART III Directors, Executive Officers and Corporate Governance Information for this item will be incorporated by reference from the company's definitive proxy statement for its 2023 Annual Meeting of Stockholders - Information for this section is incorporated by reference from the definitive proxy statement for the 2023 Annual Meeting of Stockholders512 Executive Compensation Information for this item will be incorporated by reference from the company's definitive proxy statement for its 2023 Annual Meeting of Stockholders - Information for this section is incorporated by reference from the definitive proxy statement for the 2023 Annual Meeting of Stockholders514 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information for this item will be incorporated by reference from the company's definitive proxy statement for its 2023 Annual Meeting of Stockholders - Information for this section is incorporated by reference from the definitive proxy statement for the 2023 Annual Meeting of Stockholders515 Certain Relationships and Related Transactions, and Director Independence Information for this item will be incorporated by reference from the company's definitive proxy statement for its 2023 Annual Meeting of Stockholders - Information for this section is incorporated by reference from the definitive proxy statement for the 2023 Annual Meeting of Stockholders516 Principal Accountant Fees and Services Information for this item will be incorporated by reference from the company's definitive proxy statement for its 2023 Annual Meeting of Stockholders - Information for this section is incorporated by reference from the definitive proxy statement for the 2023 Annual Meeting of Stockholders517 PART IV Exhibits and Financial Statement Schedules This section lists the financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K, including various agreements and certifications - This section provides an index of all exhibits filed with or incorporated by reference into the Form 10-K521 Form 10-K Summary This item is not applicable - Not Applicable520 Financial Statements Consolidated Balance Sheets As of June 30, 2023, total assets decreased to $41.2 million from $99.4 million, primarily due to reduced cash and reclassified assets held for sale, while total liabilities and equity also declined Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2023 | June 30, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $4,301 | $22,676 | | Total Current Assets | $26,259 | $45,070 | | Total Assets | $41,207 | $99,406 | | Total Current Liabilities | $21,582 | $30,436 | | Total Liabilities | $25,826 | $35,921 | | Total Stockholders' Equity | $15,381 | $63,485 | Consolidated Statements of Operations and Comprehensive Loss For FY2023, iBio reported a total net loss of ($65.0) million, or ($5.31) per share, primarily driven by a ($35.7) million loss from discontinued operations Consolidated Statement of Operations Highlights (in thousands, except per share data) | Metric | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Revenues (Continuing Operations) | $0 | $1,884 | | Operating Loss (Continuing Operations) | $(29,343) | $(29,697) | | Net Loss from Continuing Operations | $(29,311) | $(29,600) | | Loss from Discontinued Operations | $(35,699) | $(20,791) | | Net Loss Available to Stockholders | $(65,010) | $(50,391) | | Loss Per Share (Basic and Diluted) | $(5.31) | $(5.78) | Consolidated Statements of Cash Flows Net cash used in operating activities improved to ($30.4) million in FY2023, while investing activities provided $7.0 million, resulting in a ($21.1) million net decrease in cash, ending at $7.6 million Consolidated Cash Flow Highlights (in thousands) | Cash Flow Activity | FY 2023 | FY 2022 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(30,436) | $(37,480) | | Net Cash Provided by (Used in) Investing Activities | $7,009 | $(5,127) | | Net Cash Provided by (Used in) Financing Activities | $2,301 | $(6,125) | | Net Decrease in Cash | $(21,093) | $(48,732) | | Cash, Cash Equivalents and Restricted Cash - End of Period | $7,579 | $28,672 | Notes to Consolidated Financial Statements The notes detail accounting policies, including going concern doubts, discontinued CDMO operations, the RubrYc asset acquisition, Woodforest term loan amendments, and capital raises - Going Concern (Note 2): The financial statements were prepared assuming the company will continue as a going concern, but recurring losses, negative cash flows, and limited cash raise substantial doubt about this ability; cash of $7.6 million at June 30, 2023, is not sufficient to fund operations through Q2 FY2024585587 - Discontinued Operations (Note 3): The CDMO business is reported as a discontinued operation; in FY2023, this segment recorded a loss of $35.7 million, which included a $17.9 million fixed asset impairment charge and a $4.9 million inventory write-down592 - Significant Transactions (Note 6): The acquisition of RubrYc assets was accounted for as an asset purchase with an allocated price of approximately $1.34 million plus assumed finance leases; the company also details the 2021 purchase of its Bryan, TX facility and subsequent financing666652 - Debt (Note 14): The term loan with Woodforest Bank had a balance of $12.9 million as of June 30, 2023; the agreement has been amended six times, with the maturity date extended to December 31, 2023, contingent on the sale of the facility701703 - Stockholders' Equity (Note 17): The company executed a 1-for-25 reverse stock split on October 7, 2022; during FY2023, it raised approximately $6.4 million through at-the-market offerings and net proceeds of approximately $2.9 million from a public offering in December 2022725726733