ABVC BioPharma Reports Second Quarter 2022 Financial and Operational Results

·12 min read
ABVC BioPharma, Inc.
ABVC BioPharma, Inc.

FREMONT, CA, Aug. 15, 2022 (GLOBE NEWSWIRE) -- via NewMediaWire – ABVC BioPharma, Inc. (Nasdaq: ABVC), a clinical stage biopharmaceutical company developing therapeutic solutions in oncology/hematology, CNS, and ophthalmology, today announced its financial and operating results for the second quarter of 2022.

Second Quarter 2022 Financial Results

All comparisons are made on a year-over-year basis.

  • Revenues. The Company generated $312,860 and $31,441 in revenues for the three months ended June 30, 2022 and 2021, respectively. The increase in revenues was mainly due to the revenue generated from the clinical development service agreement signed between BioKey and Rgene.

  • Operating Expenses increased by $285,043, or 14%, to $2,351,353 for the three months ended June 30, 2022 from $2,066,310 for the three months ended June 30, 2021. The increase was mainly attributable to the increase in selling, general and administrative expenses by $361,139 which relates to costs in conjunction with our recent stock issuance, and increase in research and development expenses of $173,904 to continue developing our product pipeline, while being offset by a decrease in stock-based compensation of $250,000.

  • Other Income (Expense) was $17,076 for the three months ended June 30, 2022, compared to $(77,005) for the three months ended June 30, 2021. The change was principally caused by the increase in interest income and decrease in interest expense, as well as the loss on investment in equity securities which occurred in the six months ended June 30, 2021.

  • Net Interest income (expense) was $24,257 for the three months ended June 30, 2022, compared to $(71,949) for the three months ended June 30, 2021. The increase of $96,206, or approximately 134%, was primarily due to the repayment of convertible notes payable during the year ended 2021.

  • Net Loss. As a result of the above factors, our net loss was $1,947,333 for the three months ended June 30, 2022 compared to $2,052,956 for the three months ended June 30, 2021, representing a decrease of $105,623, or 5%.

Recent Operational Highlights

Vitargus® Phase II Study

  • Australia: Vitargus® Phase II Clinical Study protocol documents are now under review by the Australian Bellberry Human Research Ethics Committee (“HREC”). Upon approval, a Clinical Trial Notification (“CTN”) will be issued, leading to a final review by the Australian Therapeutic Goods Administration (“TGA”). Upon TGA approval, the clinical trial will begin in Australia.

  • Thailand: The Ethics Committee (“EC”) of Srinagarind Hospital, Khon Kaen University of Thailand approved the Vitargus® Phase II Clinical Study Protocol (ABV-1701-02). Ramathibodi Hospital, Mahidol University, expects to receive EC approval in the near future. Prior to initiating the two studies, the Food and Drug Administration of Thailand must issue an EC investigational product (IP) import license.

  • Vitargus Manufacturing: Vitargus will be manufactured through a new aseptic process that enhances the stability, consistency and efficacy of the final product, while significantly reducing manufacturing time. This new manufacturing process eliminates the labor-intensive and time-consuming gamma ray sterilization of the Vitargus components by using a sterile fill-lyophilization-finish (FLF).

ADHD Phase II Part 2 Clinical Update

  • A total of 22 subjects have been enrolled in the ADHD Phase II Part 2 Clinical study from a total of 32 subjects screened since results on the first subject was treated. One participant completed the 8-week treatment per the study design.

  • “A Phase II Tolerability and Efficacy Study of PDC-1421 Treatment in Adult Patients with Attention-Deficit Hyperactivity Disorder (ADHD), Part II” is expected to eventually enroll approximately 100 patients.

  • Five prestigious research hospitals in Taiwan and the research hospital at the University of California, San Francisco are participating in the study, which is a continuation of the Phase II Part I study of ABV-1505, accepted by the U.S. Food & Drug Administration in October 2020.

Other Developments

  • BioKey, ABVC’s wholly owned subsidiary based in Fremont, California, has entered into a Clinical Development Service Agreement with Rgene to guide three Rgene drug products, RGC-1501 for the treatment of Non-Small Cell Lung Cancer (NSCLC), RGC-1502 for the treatment of pancreatic cancer and RGC 1503 for the treatment of colorectal cancer patients, through completion of Phase II clinical studies under U.S. FDA IND regulatory requirements.

  • The FreeMind Group, a fundraising consulting group specializing in life sciences, will help ABVC explore and identify funding opportunities from non-dilutive sources, such as the National Institutes of Health, US Department of Defense, National Science Foundation, Food and Drug Administration and Biomedical Advanced Research and Development Authority, as well as private foundations. FreeMind will help ABVC identify the most suitable grant opportunities and assist in preparing and submitting funding applications.

  • Dr. Maurizio Fava, a world leader in the field of depression, Psychiatrist-in-Chief of Massachusetts General Hospital (MGH), executive director of the Clinical Trials Network and Institute, Associate Dean for clinical and translational research and the Slater Family Professor of Psychiatry at Harvard Medical School, along with Dr. Thomas Laughren, Director of Regulatory for the MGH Psychiatry Clinical Trials Network and Institute and retired Division Director for the Division of Psychiatry Products, Center for Drug Evaluation and Research at the U.S. Food & Drug Administration, have both agreed to provide consulting services in connection with clinical studies of its central nervous system medicines designed to alleviate symptoms of Major Depression Disorder (MDD) and Adult Depression Hyperactive Disorder (ADHD). The Company’s MDD medicine has successfully completed Phase II clinical studies which were accepted by the U.S. Food & Drug Administration in October 2020. Its ADHD medicine successfully completed Phase II, part 1 and is initiating part 2 at the University of California, San Francisco Medical Center as well as at five clinical study sites in Taiwan.

About ABVC BioPharma, Inc.

ABVC BioPharma is a clinical-stage biopharmaceutical company with an active pipeline of six drugs and one medical device (ABV-1701/Vitargus®) under development. For its drug products, it is focused on utilizing its licensed technology to conduct proof-of-concept trials through Phase II of the clinical development process at world-famous research institutions (such as Stanford University, University of California at San Francisco, and Cedars-Sinai Medical Center). For Vitargus®, the company intends to conduct the clinical trials through Phase III at various locations throughout the globe.

Forward-Looking Statements

Clinical trials are in early stages, and there is no guarantee that any specific outcome will be achieved. This press release contains “forward-looking statements.” Such statements may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential,” or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions, and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control, and cannot be predicted or quantified, and, consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) our inability to manufacture our product candidates on a commercial scale on our own, or in collaboration with third parties; (ii) difficulties in obtaining financing on commercially reasonable terms; (iii) changes in the size and nature of our competition; (iv) loss of one or more key executives or scientists;  (v) difficulties in securing regulatory approval to proceed to the next level of the clinical trials or to market our product candidates; and (vi) impact of COVID-19 pandemic on our business, results of operations, financial condition and cash flows. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Investors are urged to read these documents free of charge on the SEC’s website at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.

This press release does not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that state or jurisdiction.

Contact
ICR, LLC
Stephanie Oshchepkov
Phone: +1 203-682-7175
Email: Stephanie.Oshchepkov@icrinc.com



ABVC BIOPHARMA, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

 

2022

 

 

2021

 

 

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

$

2,910,613

 

 

$

5,828,548

 

 

Restricted cash and cash equivalents

 

688,633

 

 

 

736,667

 

 

Accounts receivable, net

 

289,474

 

 

 

280,692

 

 

Accounts receivable - related parties, net

 

142,225

 

 

 

145,399

 

 

Due from related parties

 

3,713,319

 

 

 

1,286,618

 

 

Inventory, net

 

21,855

 

 

 

25,975

 

 

Short-term investments

 

82,755

 

 

 

108,147

 

 

Prepayment for long-term investments

 

639,072

 

 

 

684,720

 

 

Prepaid expense and other current assets

 

1,301,448

 

 

 

528,354

 

 

 

Total Current Assets

 

9,789,394

 

 

 

9,625,120

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

597,318

 

 

 

525,881

 

Operating lease right-of-use assets

 

1,294,550

 

 

 

1,471,899

 

Goodwill, net

 

-

 

 

 

-

 

Long-term investments

 

870,571

 

 

 

932,755

 

Deferred tax assets

 

1,080,703

 

 

 

981,912

 

Prepaid expenses - noncurrent

 

110,099

 

 

 

119,309

 

Security deposits

 

39,977

 

 

 

41,157

 

 

 

Total Assets

$

13,782,612

 

 

$

13,698,033

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Short-term bank loans

$

1,574,000

 

 

$

1,640,000

 

 

Accounts payable

 

2,085

 

 

 

-

 

 

Accrued expenses and other current liabilities

 

1,246,898

 

 

 

1,300,803

 

 

Advance from customers

 

10,985

 

 

 

10,985

 

 

Operating lease liability – current portion

 

350,284

 

 

 

347,100

 

 

Due to related parties

 

461,612

 

 

 

393,424

 

 

 

Total Current Liabilities

 

3,645,864

 

 

 

3,692,312

 

 

 

 

 

 

 

 

 

 

Tenant security deposit

 

11,980

 

 

 

10,580

 

 

Operating lease liability – noncurrent portion

 

944,266

 

 

 

1,124,799

 

 

 

Total Liabilities

 

4,602,110

 

 

 

4,827,691

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

Preferred stock, $0.001 par value, 20,000,000 authorized, nil shares issued and outstanding

 

-

 

 

 

-

 

 

Common stock, $0.001 par value, 100,000,000 authorized, 32,307,329 and 28,926,322 shares issued and outstanding

 

32,307

 

 

 

28,926

 

 

Additional paid-in capital

 

66,240,474

 

 

 

58,113,667

 

 

Stock subscription receivable

 

(1,805,920

)

 

 

(2,257,400

)

 

Accumulated deficit

 

(46,335,637

)

 

 

(38,481,200

)

 

Accumulated other comprehensive income

 

303,100

 

 

 

539,660

 

 

Treasury stock

 

(9,100,000

)

 

 

(9,100,000

)

 

 

Total Stockholders’ equity

 

9,334,324

 

 

 

8,843,653

 

Noncontrolling Interest

 

(153,822

)

 

 

26,689

 

 

 

Total Equity

 

9,180,502

 

 

 

8,870,342

 

 

 

 

 

 

 

 

 

Total Liabilities and Equity

$

13,782,612

 

 

$

13,698,033

 

 

 

 

 

 

 

 

 



ABVC BIOPHARMA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue

$

312,860

 

 

$

31,441

 

 

$

338,520

 

 

$

294,591

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

8,367

 

 

 

646

 

 

 

10,263

 

 

 

1,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

304,493

 

 

 

30,795

 

 

 

328,257

 

 

 

292,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

1,592,831

 

 

 

1,231,692

 

 

 

2,783,909

 

 

 

2,399,287

 

 

Research and development expenses

 

532,782

 

 

 

358,878

 

 

 

892,186

 

 

 

480,193

 

 

Stock based compensation

 

225,740

 

 

 

475,740

 

 

 

4,917,743

 

 

 

701,480

 

 

 

Total operating expenses

 

2,351,353

 

 

 

2,066,310

 

 

 

8,593,838

 

 

 

3,580,960

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

(2,046,860

)

 

 

(2,035,515

)

 

 

(8,265,581

)

 

 

(3,288,260

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

39,015

 

 

 

10,722

 

 

 

79,190

 

 

 

63,251

 

 

Interest expense

 

(14,758

)

 

 

(82,671

)

 

 

(32,971

)

 

 

(212,900

)

 

Operating sublease income

 

32,802

 

 

 

53,331

 

 

 

56,926

 

 

 

58,198

 

 

Operating sublease income - related parties

 

-

 

 

 

800

 

 

 

-

 

 

 

2,400

 

 

Gain/Loss on foreign exchange changes

 

10,479

 

 

 

(5,758

)

 

 

18,042

 

 

 

(4,807

)

 

Gain/Loss on investment in equity securities

 

-

 

 

 

(53,591

)

 

 

-

 

 

 

(101,382

)

 

Other (expense) income

 

(50,462

)

 

 

162

 

 

 

(59,872

)

 

 

233

 

 

Government grant income

 

-

 

 

 

-

 

 

 

-

 

 

 

124,400

 

 

 

Total other income (expense)

 

17,076

 

 

 

(77,005

)

 

 

61,315

 

 

 

(70,607

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before provision for income tax

 

(2,029,784

)

 

 

(2,112,520

)

 

 

(8,204,266

)

 

 

(3,358,867

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income tax

 

(82,451

)

 

 

(59,564

)

 

 

(169,318

)

 

 

(110,588

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

(1,947,333

)

 

 

(2,052,956

)

 

 

(8,034,948

)

 

 

(3,248,279

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to noncontrolling interests

 

(88,336

)

 

 

(81,390

)

 

 

(180,511

)

 

 

(148,208

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributed to ABVC and subsidiaries

 

(1,858,997

)

 

 

(1,971,566

)

 

 

(7,854,437

)

 

 

(3,100,071

)

Foreign currency translation adjustment

 

(123,221

)

 

 

364,581

 

 

 

(236,560

)

 

 

400,721

 

Comprehensive loss

$

(1,982,218

)

 

$

(1,606,985

)

 

$

(8,090,997

)

 

$

(2,699,350

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

$

(0.06

)

 

$

(0.08

)

 

$

(0.26

)

 

$

(0.13

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding:

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

31,307,329

 

 

 

24,421,082

 

 

 

29,683,402

 

 

 

24,420,804

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



ABVC BIOPHARMA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2022

 

 

2021

 

Cash flows from operating activities

 

 

 

 

 

 

 

Net loss

 

$

(8,034,948

)

 

$

(3,248,279

)

 

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

Depreciation

 

 

10,902

 

 

 

5,869

 

 

 

Stock based compensation

 

 

4,917,743

 

 

 

701,480

 

 

 

Gain/Loss on sale of investment in equity securities

 

-

 

 

 

101,382

 

 

 

Government grant income

 

 

-

 

 

 

(124,400

)

 

 

Other non-cash income and expenses

 

 

18,831

 

 

 

-

 

 

 

Deferred tax

 

 

(170,118

)

 

 

(111,388

)

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Decrease (increase) in accounts receivable

 

(8,782

)

 

 

(137,312

)

 

 

 

Decrease (increase) in prepaid expenses and other current assets

 

(784,714

)

 

 

(219,020

)

 

 

 

Decrease (increase) in due from related parties

 

(2,435,935

)

 

 

(12,346

)

 

 

 

Decrease (increase) in inventory

 

 

2,473

 

 

 

-

 

 

 

 

Increase (decrease) in accounts payable

 

2,085

 

 

 

(17,997

)

 

 

 

Increase (decrease) in accrued expenses and other current liabilities

 

(21,915

)

 

 

201,591

 

 

 

 

Increase (decrease) in advanced from others

 

-

 

 

 

(1,085

)

 

 

 

Increase (decrease) in due to related parties

 

80,760

 

 

 

4,427

 

 

 

 

 

Net cash used in operating activities

 

(6,423,618

)

 

 

(2,857,078

)

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

Purchase of equipment

 

 

(115,246

)

 

 

-

 

 

Prepayment for equity investment

 

 

-

 

 

 

(421,974

)

 

 

 

 

Net cash used in investing activities

 

(115,246

)

 

 

(421,974

)

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

Issuance of common stock

 

 

3,663,925

 

 

 

-

 

 

Repayment of convertible notes

 

 

-

 

 

 

(306,836

)

 

Proceeds from long-term loan

 

 

-

 

 

 

236,498

 

 

Repayment of long-term bank loans

 

 

-

 

 

 

(4,396

)

 

 

 

 

Net cash provided by (used in) financing activities

3,663,925

 

 

 

(74,734

)

 

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents and restricted cash

 

(91,030

)

 

 

9,419

 

 

 

 

 

 

 

 

 

 

 

 

Net decrease in cash and cash equivalents and restricted cash

 

(2,965,969

)

 

 

(3,344,367

)

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents and restricted cash

 

 

 

 

 

 

Beginning

 

 

6,565,215

 

 

 

5,001,371

 

 

Ending

 

$

3,599,246

 

 

$

1,657,004

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flows

 

 

 

 

 

 

 

Cash paid during the year for:

 

 

 

 

 

 

 

 

Interest expense paid

 

$

24,348

 

 

$

69,623

 

 

 

Income taxes paid

 

$

-

 

 

$

-