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 | $ | – | $ | – | |||||||
