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ABVC BioPharma(ABVC) - 2024 Q1 - Quarterly Report
ABVCABVC BioPharma(ABVC)2024-05-17 20:01

Financial Performance - The company reported revenues of 1,205forthethreemonthsendedMarch31,2024,asignificantdecreasefrom1,205 for the three months ended March 31, 2024, a significant decrease from 128,272 for the same period in 2023, indicating a decline of approximately 99.1%[13] - Operating expenses for the three months ended March 31, 2024, totaled 3,445,318,comparedto3,445,318, compared to 1,974,220 for the same period in 2023, reflecting an increase of approximately 74.4%[13] - The net loss for the three months ended March 31, 2024, was 3,981,019,comparedtoanetlossof3,981,019, compared to a net loss of 1,897,230 for the same period in 2023, representing an increase in loss of approximately 109.5%[13] - The company reported a gross loss of 928forthethreemonthsendedMarch31,2024,comparedtoagrossprofitof928 for the three months ended March 31, 2024, compared to a gross profit of 68,036 for the same period in 2023, indicating a significant decline in profitability[13] - For the three months ended March 31, 2024, the company reported a net loss of 3,981,019,comparedtoanetlossof3,981,019, compared to a net loss of 1,897,230 for the same period in 2023, representing an increase in loss of approximately 109%[23] - The company experienced net cash outflows of 473,161fromoperatingactivitiesforthethreemonthsendedMarch31,2024[23]−Thecompanyreportedanetlossattributabletocommonstockholdersof473,161 from operating activities for the three months ended March 31, 2024[23] - The company reported a net loss attributable to common stockholders of 3,932,976 for the three months ended March 31, 2024, compared to a net loss of 1,823,695forthesameperiodin2023[189]AssetsandLiabilities−TotalcurrentassetsasofMarch31,2024,increasedto1,823,695 for the same period in 2023[189] Assets and Liabilities - Total current assets as of March 31, 2024, increased to 1,794,450 from 1,656,709asofDecember31,2023,representinganincreaseofapproximately8.31,656,709 as of December 31, 2023, representing an increase of approximately 8.3%[11] - Cash and cash equivalents decreased to 30,489 as of March 31, 2024, from 60,155asofDecember31,2023,adeclineofapproximately49.360,155 as of December 31, 2023, a decline of approximately 49.3%[11] - Total liabilities increased to 6,973,447 as of March 31, 2024, from 6,361,627asofDecember31,2023,anincreaseofapproximately9.66,361,627 as of December 31, 2023, an increase of approximately 9.6%[11] - The total stockholders' equity decreased to 7,486,955 as of March 31, 2024, from 8,130,972asofDecember31,2023,adecreaseofapproximately7.98,130,972 as of December 31, 2023, a decrease of approximately 7.9%[11] - The company's working capital deficit as of March 31, 2024, was 4,839,164, indicating significant financial strain[23] - The company’s accumulated deficit increased to 69,353,071asofMarch31,2024,from69,353,071 as of March 31, 2024, from 65,420,095 as of December 31, 2023, indicating a rise of approximately 4.5%[11] Shareholder Information - The weighted average shares used in computing net loss per share increased to 9,736,150 for the three months ended March 31, 2024, compared to 3,307,577 for the same period in 2023, an increase of approximately 194.5%[13] - The company issued 751,795 common shares upon the exercise of convertible notes, raising approximately 681,000[19]−ThecompanybelievesthereversestocksplitwillhelprestorecompliancewithNASDAQCapitalMarketlistingstandards[29]CashFlowandFinancing−Thecompanyhassubstantialdoubtregardingitsabilitytocontinueasagoingconcernduetoongoinglossesandworkingcapitaldeficits[23]−Thecompanyissuedasecured,convertiblenotetoLindGlobalFundII,LP,intheprincipalamountof681,000[19] - The company believes the reverse stock split will help restore compliance with NASDAQ Capital Market listing standards[29] Cash Flow and Financing - The company has substantial doubt regarding its ability to continue as a going concern due to ongoing losses and working capital deficits[23] - The company issued a secured, convertible note to Lind Global Fund II, LP, in the principal amount of 3,704,167, convertible at an initial price of 1.05pershare[140]−ThecompanyenteredintoanewsecuritiespurchaseagreementwithLindonNovember17,2023,issuingaconvertiblenoteof1.05 per share[140] - The company entered into a new securities purchase agreement with Lind on November 17, 2023, issuing a convertible note of 1,200,000 for a purchase price of 1,000,000[144]−TheoutstandingloanbalancewithRgenewas1,000,000[144] - The outstanding loan balance with Rgene was 500,000 as of March 31, 2024, with accrued interest of 38,819[166]ResearchandDevelopment−Thecompanyisfocusedonthedevelopmentofnewdrugsandmedicaldevicesderivedfromplants,withclinicaltrialsbeingconductedatprestigiousinstitutions[22]−TheCompanyaccountsforresearchanddevelopmentexpensesasincurred,includingpersonnel−relatedcostsandclinicaltrialcosts,withnoalternativefutureuse[77]−TheCompanyrecognizesrevenuesfromresearchanddevelopmentactivitieswhenrelatedservicesareperformed,typicallyhavingoneperformanceobligationatcontractinception[55]AgreementsandCollaborations−TheCompanyhasaco−developmentagreementwithBHKforthedevelopmentofBLI−1401−2,withdevelopmentcostsshared50/50,andtheagreementlastsforfifteenyearsfromthefirstcommercialsaleinAsiaexcludingJapan[93]−ThetotalmilestonepaymentsundertheBHKCo−DevelopmentAgreementamountto38,819[166] Research and Development - The company is focused on the development of new drugs and medical devices derived from plants, with clinical trials being conducted at prestigious institutions[22] - The Company accounts for research and development expenses as incurred, including personnel-related costs and clinical trial costs, with no alternative future use[77] - The Company recognizes revenues from research and development activities when related services are performed, typically having one performance obligation at contract inception[55] Agreements and Collaborations - The Company has a co-development agreement with BHK for the development of BLI-1401-2, with development costs shared 50/50, and the agreement lasts for fifteen years from the first commercial sale in Asia excluding Japan[93] - The total milestone payments under the BHK Co-Development Agreement amount to 10 million, with specific payments tied to clinical trial phases and regulatory submissions[94] - The Company has a co-development agreement with Rgene Corporation, requiring Rgene to pay 3millionforpastresearchefforts,withfuturenetlicensingincomeshared50/50[99]EmployeeCompensation−TheCompanyrecognizedtotalemployeestock−basedcompensationexpensesof3 million for past research efforts, with future net licensing income shared 50/50[99] Employee Compensation - The Company recognized total employee stock-based compensation expenses of 1,935,755 for the three months ended March 31, 2024, compared to 0forthesameperiodin2023[79]−Thecompanyissued1,241,615restrictedsharestoemployeesanddirectorsunderthe2016EquityIncentivePlan,withathree−yearrestrictionperiod[181]TaxandDeferredAssets−Thecompanyhasanetdeferredtaxassetofapproximately0 for the same period in 2023[79] - The company issued 1,241,615 restricted shares to employees and directors under the 2016 Equity Incentive Plan, with a three-year restriction period[181] Tax and Deferred Assets - The company has a net deferred tax asset of approximately 6,252,782 as of March 31, 2024, primarily due to net operating loss carryforwards[173] - The Company assesses the need for a valuation allowance on deferred tax assets based on projections of future taxable income and tax planning strategies[86] Property and Equipment - The Company has a total of 11,271,552inpropertyandequipmentasofMarch31,2024,withanetvalueof11,271,552 in property and equipment as of March 31, 2024, with a net value of 7,949,150 after depreciation[117] - The Company acquired 20% ownership of a property valued at 37millioninChengdu,China,for37 million in Chengdu, China, for 7.4 million, aimed at developing a healthcare center[120]