10-Q
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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 September 30, 2023

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)

 

Registrant’s telephone number, including area code: (833) 727-2841

 

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 November 6, 2023, the registrant had 23,703,672 shares of common stock, par value $0.001 per share, outstanding.

 


 

Table of Contents

 

 

 

 

 

Page

PART 1

 

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

 

5

 

 

 

 

 

Item 2.

 

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

 

22

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

28

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

28

 

PART II

 

OTHER INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

29

 

 

 

 

 

Item 1A.

 

Risk Factors

 

29

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

61

 

 

 

 

 

Item 3.

 

Default Upon Senior Securities

 

61

 

 

 

 

 

Item 4.

 

Mine Safety Disclosures

 

61

 

 

 

 

 

Item 5.

 

Other Information

 

61

 

 

 

 

 

Item 6.

 

Exhibits

 

62

 

 

 

 

Signatures

 

63

EXPLANATORY NOTE

All share and per share information included in this Quarterly Report on Form 10-Q has been retroactively adjusted to reflect a 1-for-25 reverse stock split effected on January 3, 2023.

TRADEMARKS

Biora TherapeuticsTM, BIOJETTM, NAVICAPTM, and GITRACTM are trademarks 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)

 

 

 

September 30, 2023

 

 

December 31, 2022

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash, cash equivalents and restricted cash

 

$

12,569

 

 

$

30,486

 

Income tax receivable

 

 

818

 

 

 

828

 

Prepaid expenses and other current assets

 

 

3,351

 

 

 

4,199

 

Current assets of disposal group held for sale

 

 

2,509

 

 

 

2,603

 

Total current assets

 

 

19,247

 

 

 

38,116

 

Property and equipment, net

 

 

1,236

 

 

 

1,654

 

Right-of-use assets

 

 

1,834

 

 

 

1,482

 

Other assets

 

 

6,314

 

 

 

6,201

 

Goodwill

 

 

6,072

 

 

 

6,072

 

Total assets

 

$

34,703

 

 

$

53,525

 

Liabilities and Stockholders' Deficit

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

3,905

 

 

$

3,606

 

Accrued expenses and other current liabilities

 

 

24,314

 

 

 

16,161

 

Warrant liabilities

 

 

41,325

 

 

 

3,538

 

Total current liabilities

 

 

69,544

 

 

 

23,305

 

Convertible notes, net of unamortized discount of $2,347 and $4,914 as of September 30, 2023
   and December 31, 2022, respectively

 

 

80,378

 

 

 

127,811

 

Other long-term liabilities

 

 

3,567

 

 

 

4,696

 

Total liabilities

 

$

153,489

 

 

$

155,812

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

Stockholders' deficit:

 

 

 

 

 

 

Common stock – $0.001 par value; 164,000,000 shares authorized; 24,147,645 and 9,098,844
   shares issued as of September 30, 2023 and December 31, 2022, respectively;
   
23,411,013 and 8,928,498 shares outstanding as of September 30, 2023
   and December 31, 2022, respectively

 

 

21

 

 

 

8

 

Additional paid-in capital

 

 

835,817

 

 

 

743,626

 

Accumulated deficit

 

 

(935,545

)

 

 

(826,843

)

Treasury stock – at cost; 736,632 and 170,346 shares as of September 30, 2023 and
   December 31, 2022, respectively

 

 

(19,079

)

 

 

(19,078

)

Total stockholders' deficit

 

 

(118,786

)

 

 

(102,287

)

Total liabilities and stockholders' deficit

 

$

34,703

 

 

$

53,525

 

 

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
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenues

 

$

 

 

$

80

 

 

$

4

 

 

$

291

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

10,547

 

 

 

5,820

 

 

 

23,720

 

 

 

18,282

 

Selling, general and administrative

 

 

12,774

 

 

 

8,147

 

 

 

30,083

 

 

 

30,014

 

Total operating expenses

 

 

23,321

 

 

 

13,967

 

 

 

53,803

 

 

 

48,296

 

Loss from operations

 

 

(23,321

)

 

 

(13,887

)

 

 

(53,799

)

 

 

(48,005

)

Interest expense, net

 

 

(2,592

)

 

 

(2,773

)

 

 

(7,975

)

 

 

(8,305

)

Gain on warrant liabilities

 

 

4,568

 

 

 

2,044

 

 

 

5,271

 

 

 

15,446

 

Other (expense) income, net

 

 

(52,108

)

 

 

(100

)

 

 

(52,194

)

 

 

4,824

 

Loss before income taxes

 

 

(73,453

)

 

 

(14,716

)

 

 

(108,697

)

 

 

(36,040

)

Income tax expense (benefit)

 

 

1

 

 

 

158

 

 

 

5

 

 

 

(679

)

Loss from continuing operations

 

 

(73,454

)

 

 

(14,874

)

 

 

(108,702

)

 

 

(35,361

)

Gain from discontinued operations

 

 

 

 

 

9,760

 

 

 

 

 

 

10,926

 

Net loss

 

 

(73,454

)

 

 

(5,114

)

 

 

(108,702

)

 

 

(24,435

)

Net loss per share from continuing operations, basic and diluted

 

$

(4.89

)

 

$

(1.99

)

 

$

(8.54

)

 

$

(4.78

)

Net gain per share from discontinued operations, basic and diluted

 

$

 

 

$

1.31

 

 

$

 

 

$

1.48

 

Net loss per share, basic and diluted

 

$

(4.89

)

 

$

(0.68

)

 

$

(8.54

)

 

$

(3.30

)

Weighted average shares outstanding, basic and diluted

 

 

15,024,726

 

 

 

7,478,150

 

 

 

12,727,650

 

 

 

7,394,243

 

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, 2022

 

 

9,098,844

 

 

$

8

 

 

$

743,626

 

 

$

(826,843

)

 

 

(170,346

)

 

$

(19,078

)

 

$

(102,287

)

Issuance of common stock, net

 

 

2,853,109

 

 

 

3

 

 

 

12,521

 

 

 

 

 

 

 

 

 

 

 

 

12,524

 

Issuance of common stock upon vesting of restricted stock units

 

 

146,321

 

 

 

 

 

 

(178

)

 

 

 

 

 

(68,938

)

 

 

 

 

 

(178

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,384

 

 

 

 

 

 

 

 

 

 

 

 

2,384

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(17,441

)

 

 

 

 

 

 

 

 

(17,441

)

Balance at March 31, 2023

 

 

12,098,274

 

 

$

11

 

 

$

758,353

 

 

$

(844,284

)

 

 

(239,284

)

 

$

(19,078

)

 

$

(104,998

)

Issuance of common stock, net

 

 

1,509,434

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of common stock upon vesting of restricted stock units

 

 

79,256

 

 

 

 

 

 

(90

)

 

 

 

 

 

(26,821

)

 

 

 

 

 

(90

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,014

 

 

 

 

 

 

 

 

 

 

 

 

2,014

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(17,807

)

 

 

 

 

 

 

 

 

(17,807

)

Balance at June 30, 2023

 

 

13,686,964

 

 

$

11

 

 

$

760,277

 

 

$

(862,091

)

 

 

(266,105

)

 

$

(19,078

)

 

$

(120,881

)

Issuance of common stock, net

 

 

82,916

 

 

 

 

 

 

10

 

 

 

 

 

 

 

 

 

 

 

 

10

 

Issuance of common stock upon vesting of restricted stock units

 

 

1,142,484

 

 

 

1

 

 

 

(1,691

)

 

 

 

 

 

(470,527

)

 

 

(1

)

 

 

(1,691

)

Issuance of common stock upon conversion of debt, net

 

 

9,235,281

 

 

 

9

 

 

 

66,690

 

 

 

 

 

 

 

 

 

 

 

 

66,699

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

10,531

 

 

 

 

 

 

 

 

 

 

 

 

10,531

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(73,454

)

 

 

 

 

 

 

 

 

(73,454

)

Balance at September 30, 2023

 

 

24,147,645

 

 

$

21

 

 

$

835,817

 

 

$

(935,545

)

 

 

(736,632

)

 

$

(19,079

)

 

$

(118,786

)

 

 

 

Common Stock

 

 

Additional
Paid-In

 

 

Accumulated

 

 

Treasury Stock

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Shares

 

 

Amount

 

 

Deficit

 

Balance at December 31, 2021

 

 

7,429,458

 

 

$

6

 

 

$

722,782

 

 

$

(788,686

)

 

 

(154,569

)

 

$

(19,078

)

 

$

(84,976

)

Issuance of common stock, net

 

 

85,213

 

 

 

 

 

 

3,626

 

 

 

 

 

 

 

 

 

 

 

 

3,626

 

Issuance of common stock upon vesting of restricted stock units

 

 

11,520

 

 

 

 

 

 

(80

)

 

 

 

 

 

(3,723

)

 

 

 

 

 

(80

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,053

 

 

 

 

 

 

 

 

 

 

 

 

2,053

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(13,808

)

 

 

 

 

 

 

 

 

(13,808

)

Balance at March 31, 2022

 

 

7,526,191

 

 

$

6

 

 

$

728,381

 

 

$

(802,494

)

 

 

(158,292

)

 

$

(19,078

)

 

$

(93,185

)

Issuance of common stock, net

 

 

69,028

 

 

 

 

 

 

1,168

 

 

 

 

 

 

 

 

 

 

 

 

1,168

 

Issuance of common stock under employee stock purchase plan

 

 

5,002

 

 

 

 

 

 

89

 

 

 

 

 

 

 

 

 

 

 

 

89

 

Issuance of common stock upon vesting of restricted stock units

 

 

12,667

 

 

 

 

 

 

(111

)

 

 

 

 

 

(3,017

)

 

 

 

 

 

(111

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,446

 

 

 

 

 

 

 

 

 

 

 

 

1,446

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(5,513

)

 

 

 

 

 

 

 

 

(5,513

)

Balance at June 30, 2022

 

 

7,612,888

 

 

$

6

 

 

$

730,973

 

 

$

(808,007

)

 

 

(161,309

)

 

$

(19,078

)

 

$

(96,106

)

Issuance of common stock, net

 

 

110,293

 

 

 

 

 

 

1,659

 

 

 

 

 

 

 

 

 

 

 

 

1,659

 

Issuance of common stock upon vesting of restricted stock units

 

 

2,817

 

 

 

 

 

 

(21

)

 

 

 

 

 

(817

)

 

 

 

 

 

(21

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

2,139

 

 

 

 

 

 

 

 

 

 

 

 

2,139

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(5,114

)

 

 

 

 

 

 

 

 

(5,114

)

Balance at September 30, 2022

 

 

7,725,998

 

 

$

6

 

 

$

734,750

 

 

$

(813,121

)

 

 

(162,126

)

 

$

(19,078

)

 

$

(97,443

)

See accompanying notes to unaudited condensed consolidated financial statements.

3


 

Biora Therapeutics, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Nine Months Ended
September 30,

 

 

 

2023

 

 

2022

 

Operating Activities:

 

 

 

 

 

 

Net loss

 

$

(108,702

)

 

$

(24,435

)

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

 

 

 

 

 

 

Gain from discontinued operations

 

 

 

 

 

(10,926

)

Depreciation and amortization

 

 

438

 

 

 

749

 

Stock-based compensation expense

 

 

14,929

 

 

 

5,638

 

Inducement loss on convertible notes

 

 

53,198

 

 

 

 

Amortization of debt discount and non-cash interest

 

 

1,126

 

 

 

1,052

 

Loss on disposal of property and equipment

 

 

12

 

 

 

520

 

Impairment of property and equipment

 

 

100

 

 

 

545

 

Gain on investment in Enumera Molecular, Inc.

 

 

 

 

 

(5,731

)

Change in fair value of warrant liabilities

 

 

(5,271

)

 

 

(15,446

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Income tax receivable

 

 

10

 

 

 

(828

)

Prepaid expenses and other current assets