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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2022

or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from to

Commission File Number: 001-39334

 

 

Biora Therapeutics, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

27-3950390

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

4330 La Jolla Village Drive, Suite 300, San Diego, CA

 

92122

(Address of principal executive offices)

 

(Zip Code)

 

(855) 293-2639

(Registrant’s telephone number, including area code)

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

 

 

Common Stock, par value $0.001 per share

 

BIOR

 

The Nasdaq Global Market

 

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

Non-accelerated filer

 

 

Smaller reporting company

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☒ No

As of August 1, 2022, the registrant had 186,623,605 shares of common stock, par value $0.001 per share, outstanding.

 

 


 

Biora Therapeutics, Inc.

INDEX

 

PART I—FINANCIAL INFORMATION

 

 

 

 

 

Item 1.

 

Financial Statements (unaudited)

 

1

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets

 

1

 

 

 

 

 

 

 

Condensed Consolidated Statements of Operations

 

2

 

 

 

 

 

 

 

Condensed Consolidated Statements of Stockholders’ Deficit

 

3

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows

 

4

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

6

 

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

26

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

37

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

37

 

PART II—OTHER INFORMATION

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

38

 

 

 

 

 

Item 1A.

 

Risk Factors

 

40

 

 

 

 

 

Item 6.

 

Exhibits

 

74

 

 

 

 

Signatures

 

75

 

 

TRADEMARKS AND CERTAIN TERMS

In this Quarterly Report on Form 10-Q, “Biora,” “Biora Therapeutics,” the “Company,” “we,” “us” and “our” refer to Biora Therapeutics, Inc., and our wholly-owned subsidiaries on a consolidated basis, unless the context otherwise provides.

Biora Therapeutics™ is a trademark of Biora Therapeutics, Inc. Any other brand names or trademarks appearing in this Quarterly Report on Form 10-Q are the property of their respective holders.

 

 

i


 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

Biora Therapeutics, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

(Unaudited)

 

 

 

June 30,
2022

 

 

December 31,
2021

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

48,506

 

 

$

88,397

 

Accounts receivable, net

 

 

 

 

 

653

 

Income tax receivable

 

 

817

 

 

 

 

Prepaid expenses and other current assets

 

 

8,675

 

 

 

7,232

 

Current assets of disposal group held for sale

 

 

2,147

 

 

 

2,147

 

Total current assets

 

 

60,145

 

 

 

98,429

 

Property and equipment, net

 

 

2,454

 

 

 

4,012

 

Right-of-use assets

 

 

2,203

 

 

 

 

Other assets

 

 

6,227

 

 

 

326

 

Goodwill

 

 

6,072

 

 

 

6,072

 

Total assets

 

$

77,101

 

 

$

108,839

 

Liabilities and Stockholders' Deficit

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

4,315

 

 

$

8,709

 

Accrued expenses and other current liabilities

 

 

30,940

 

 

 

34,157

 

Warrant liability

 

 

5,329

 

 

 

18,731

 

Current portion of capital lease obligations

 

 

 

 

 

12

 

Total current liabilities

 

 

40,584

 

 

 

61,609

 

Convertible notes, net of unamortized discount of $5,639 and $6,333 as of June 30, 2022
   and December 31, 2021, respectively

 

 

127,086

 

 

 

126,392

 

Other long-term liabilities

 

 

5,537

 

 

 

5,814

 

Total liabilities

 

$

173,207

 

 

$

193,815

 

Commitments and contingencies (Note 10)

 

 

 

 

 

 

Stockholders' deficit:

 

 

 

 

 

 

Common stock – $0.001 par value. 350,000,000 shares authorized as of June 30, 2022
   and December 31, 2021;
190,322,688 and 185,736,890 shares issued as of
   June 30, 2022 and December 31, 2021, respectively;
186,289,978 and 181,872,676
   shares outstanding as of June 30, 2022 and December 31, 2021, respectively

 

 

150

 

 

 

146

 

Additional paid-in capital

 

 

730,833

 

 

 

722,646

 

Accumulated deficit

 

 

(808,007

)

 

 

(788,686

)

Treasury stock – at cost; 4,032,710 and 3,864,214 shares of common stock
   as of June 30, 2022 and December 31, 2021, respectively

 

 

(19,082

)

 

 

(19,082

)

Total stockholders' deficit

 

 

(96,106

)

 

 

(84,976

)

Total liabilities and stockholders' deficit

 

$

77,101

 

 

$

108,839

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

1


 

Biora Therapeutics, INC.

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues

 

$

104

 

 

$

463

 

 

$

211

 

 

$

630

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

5,904

 

 

 

13,401

 

 

 

12,462

 

 

 

25,074

 

Selling, general and administrative

 

 

8,410

 

 

 

22,715

 

 

 

21,867

 

 

 

42,673

 

Total operating expenses

 

 

14,314

 

 

 

36,116

 

 

 

34,329

 

 

 

67,747

 

Loss from operations

 

 

(14,210

)

 

 

(35,653

)

 

 

(34,118

)

 

 

(67,117

)

Interest expense, net

 

 

(2,772

)

 

 

(3,502

)

 

 

(5,532

)

 

 

(7,022

)

Gain (loss) on warrant liability

 

 

4,413

 

 

 

(5,146

)

 

 

13,402

 

 

 

(2,496

)

Other income, net

 

 

5,735

 

 

 

2,901

 

 

 

4,924

 

 

 

17,774

 

Loss before income taxes

 

 

(6,834

)

 

 

(41,400

)

 

 

(21,324

)

 

 

(58,861

)

Income tax benefit

 

 

(837

)

 

 

 

 

 

(837

)

 

 

 

Loss from continuing operations

 

 

(5,997

)

 

 

(41,400

)

 

 

(20,487

)

 

 

(58,861

)

Gain (loss) from discontinued operations

 

 

484

 

 

 

(37,131

)

 

 

1,166

 

 

 

(51,934

)

Net loss

 

 

(5,513

)

 

 

(78,531

)

 

 

(19,321

)

 

 

(110,795

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share from continuing operations, basic and diluted

 

$

(0.03

)

 

$

(0.65

)

 

$

(0.11

)

 

$

(0.97

)

Net (loss) gain per share from discontinued operations, basic and diluted

 

$

 

 

$

(0.58

)

 

$

0.01

 

 

$

(0.85

)

Net loss per share, basic and diluted

 

$

(0.03

)

 

$

(1.23

)

 

$

(0.10

)

 

$

(1.82

)

Weighted average shares outstanding, basic and diluted

 

 

184,371,626

 

 

 

63,942,298

 

 

 

183,789,876

 

 

 

60,770,246

 

 

See accompanying notes to unaudited condensed consolidated financial statements.

2


 

Biora Therapeutics, INC.

Condensed Consolidated Statements of Stockholders’ Deficit

(In thousands, except share data)

(Unaudited)

 

 

 

Common Stock

 

 

Additional
Paid-In

 

 

Accumulated

 

 

Treasury Stock

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Shares

 

 

Amount

 

 

Deficit

 

Balance at December 31, 2021

 

 

185,736,890

 

 

$

146

 

 

$

722,646

 

 

$

(788,686

)

 

 

(3,864,214

)

 

$

(19,082

)

 

$

(84,976

)

Issuance of common stock, net

 

 

2,130,327

 

 

 

2

 

 

 

3,624

 

 

 

 

 

 

 

 

 

 

 

 

3,626

 

Issuance of common stock upon vesting
   of restricted stock units

 

 

288,003

 

 

 

 

 

 

(80

)

 

 

 

 

 

(93,076

)

 

 

 

 

 

(80

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,053

 

 

 

 

 

 

 

 

 

 

 

 

2,053

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(13,808

)

 

 

 

 

 

 

 

 

(13,808

)

Balance at March 31, 2022

 

 

188,155,220

 

 

$

148

 

 

$

728,243

 

 

$

(802,494

)

 

 

(3,957,290

)

 

$

(19,082

)

 

$

(93,185

)

Issuance of common stock, net

 

 

1,725,723

 

 

 

2

 

 

 

1,166

 

 

 

 

 

 

 

 

 

 

 

 

1,168

 

Issuance of common stock under employee stock purchase plan

 

 

125,059

 

 

 

 

 

 

89

 

 

 

 

 

 

 

 

 

 

 

 

89

 

Issuance of common stock upon vesting
   of restricted stock unit awards

 

 

316,686

 

 

 

 

 

 

(111

)

 

 

 

 

 

(75,420

)

 

 

 

 

 

(111

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,446

 

 

 

 

 

 

 

 

 

 

 

 

1,446

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(5,513

)

 

 

 

 

 

 

 

 

(5,513

)

Balance at June 30, 2022

 

 

190,322,688

 

 

$

150

 

 

$

730,833

 

 

$

(808,007

)

 

 

(4,032,710

)

 

$

(19,082

)

 

$

(96,106

)

 

 

 

 

Common Stock

 

 

Additional
Paid-In

 

 

Accumulated

 

 

Treasury Stock

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Shares

 

 

Amount

 

 

Deficit

 

Balance at December 31, 2020

 

 

59,287,331

 

 

$

59

 

 

$

452,992

 

 

$

(541,274

)

 

 

(3,515,028

)

 

$

(18,771

)

 

$

(106,994

)

Issuance of common stock, net

 

 

4,370,629

 

 

 

4

 

 

 

11,258

 

 

 

 

 

 

 

 

 

 

 

 

11,262

 

Exercise of common stock options

 

 

71,284

 

 

 

 

 

 

88

 

 

 

 

 

 

 

 

 

 

 

 

88

 

Issuance of common stock upon vesting
   of restricted stock units

 

 

174,730

 

 

 

 

 

 

(228

)

 

 

 

 

 

(48,581

)

 

 

(1

)

 

 

(229

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,630

 

 

 

 

 

 

 

 

 

 

 

 

2,630

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(32,264

)

 

 

 

 

 

 

 

 

(32,264

)

Balance at March 31, 2021

 

 

63,903,974

 

 

$

63

 

 

$

466,740

 

 

$

(573,538

)

 

 

(3,563,609

)

 

$

(18,772

)

 

$

(125,507

)

Issuance of common stock, net

 

 

15,694,332

 

 

 

16

 

 

 

11,991

 

 

 

 

 

 

 

 

 

 

 

 

12,007

 

Issuance of common stock upon exercise
   of options

 

 

25,498

 

 

 

 

 

 

26

 

 

 

 

 

 

(5,050

)

 

 

(6

)

 

 

20

 

Issuance of common stock under employee stock purchase plan

 

 

254,832

 

 

 

1

 

 

 

560

 

 

 

 

 

 

 

 

 

 

 

 

561

 

Issuance of common stock upon vesting
   of restricted stock unit awards

 

 

237,388

 

 

 

 

 

 

(251

)

 

 

 

 

 

(79,442

)

 

 

 

 

 

(251

)

Issuance of stock purchase warrant

 

 

 

 

 

 

 

 

41,926

 

 

 

 

 

 

 

 

 

 

 

 

41,926

 

Issuance of common stock upon conversion of debt, net

 

 

611,616

 

 

 

1

 

 

 

2,068

 

 

 

 

 

 

 

 

 

 

 

 

2,069

 

Issuance of common stock upon conversion of interest, net

 

 

1,268,116

 

 

 

1

 

 

 

3,626

 

 

 

 

 

 

 

 

 

 

 

 

3,627

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

4,470

 

 

 

 

 

 

 

 

 

 

 

 

4,470

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(78,531

)

 

 

 

 

 

 

 

 

(78,531

)

Balance at June 30, 2021

 

 

81,995,756

 

 

$

82

 

 

$

531,156

 

 

$

(652,069

)

 

 

(3,648,101

)

 

$

(18,778

)

 

$

(139,609

)

 

See accompanying notes to unaudited condensed consolidated financial statements.

3


 

Biora Therapeutics, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

Operating Activities:

 

 

 

 

 

 

Net loss

 

$

(19,321

)

 

$

(110,795

)

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

 

 

 

 

 

 

(Gain) loss from discontinued operations

 

 

(1,166

)

 

 

51,934

 

Non-cash revenue reserve

 

 

201

 

 

 

172

 

Depreciation and amortization

 

 

547

 

 

 

965

 

Stock-based compensation expense

 

 

3,499

 

 

 

5,625

 

Loss on extinguishment of convertible notes

 

 

 

 

 

242

 

Amortization of debt discount and non-cash interest

 

 

694

 

 

 

4,753

 

Loss on disposal of property and equipment

 

 

320

 

 

 

 

Impairment of property and equipment

 

 

545

 

 

 

 

Gain on investment in Enumera Molecular, Inc.

 

 

(5,731

)

 

 

 

Change in fair value of derivative liability

 

 

 

 

 

(17,977

)

Change in fair value of warrant liability

 

 

(13,402

)

 

 

2,496