Full Press Release Details
BeyondSpring Announces Third Quarter 2020 Financial Results and Provides Business Updates
- Announced SEED Therapeutics Inc.("SEED")'s collaboration with Eli Lilly and Company("Lilly")
NEW YORK, November 17, 2020 - BeyondSpring Inc. (the "Company" or "BeyondSpring") (NASDAQ: BYSI), a global biopharmaceutical company focused on the development of innovative cancer therapies, today announced
its financial results and provided an operational update for the three months ended September 30, 2020.
"We were thrilled to announce positive top-line data in our pivotal Phase 3 study demonstrating plinabulin in combination with pegfilgrastim (peg) provides superior benefits for patients
in preventing chemotherapy-induced neutropenia (CIN) compared with peg alone. Results show combination plinabulin + peg's ability to reduce infection and hospitalization rates after chemotherapy, allowing for the potential for patients to continue
receiving life-saving treatments. This means patients may potentially receive more stable doses, longer sustained cycles and the strongest regimens possible resulting in potential survival benefit," said Dr. Lan Huang, co-founder, chairperson and
chief executive officer of BeyondSpring. "We expect to file a New Drug Application (NDA) for CIN, plinabulin's first indication, in the U.S. in early 2021, soon followed by an NDA submission in China and look forward bringing this important therapy
Select Third Quarter 2020 and Recent Business Highlights
Recent Clinical Highlights
Breakthrough Therapy Designation
Received Breakthrough Therapy Designation for plinabulin in CIN from both the U.S. FDA and China's Center for Drug Evaluation (CDE) of the National Medical Products Administration (NMPA). FDA's Breakthrough Therapy designation is intended to
expedite the development and review of a drug candidate that is planned to treat a serious or life-threatening disease or condition in which clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on
one or more clinically significant endpoints.
Recent Corporate Highlights
SEED's collaboration with Lilly
Announced a research collaboration and license agreement and a share purchase agreement between SEED and Lilly in the area of targeted protein degradation (TPG), or "molecular glue", SEED will receive a $10 million upfront payment, up to $10
million investment and up to approximately $780 million in milestones related to preclinical, clinical, regulatory and commercial milestones, plus royalties on net sales of products that result from the collaboration.
BeyondSpring Appoints Elizabeth Czerepak as Chief Financial Officer
Announced the appointment of Elizabeth Czerepak to the role of chief financial officer. Ms. Czerepak brings to BeyondSpring more than 30 years of senior finance and leadership experience, including Board and venture capital experience. Ms.
Czerepak most recently served as CFO and chief business officer of Genevant Sciences. Simultaneously, the Company announced the appointment of Edward Liu as chief financial officer to SEED focused on a targeted protein degradation platform to attack
previously believed undruggable targets.
Financial Results for the Three Months Ended September 30, 2020
Research and development ("R&D") expenses were $8.6 million for the quarter ended September 30, 2020, compared to $7.2 million for the quarter ended September 30, 2019. The $1.4 million increase was largely attributable to higher clinical
trial costs and NDA preparation costs.
General and administrative ("G&A") expenses were $6.7 million for the quarter ended September 30, 2020, compared to $2.5 million for the quarter ended September 30, 2019. The $4.2 million increase was primarily due to an increase of $2.0
million related to pre-launch commercialization costs for plinabulin, and an increase of $1.9 million in G&A employees' compensation.
Net loss attributable to the Company was $14.5 million for the quarter ended September 30, 2020, compared to $9.4 million for the quarter ended September 30, 2019.
As of September 30, 2020, the Company had cash and cash equivalents of $30.9 million on hand. The Company believes with the implementation of a cost reduction plan it has sufficient cash to support its clinical trials and the preparation of NDA
submissions in the U.S. and China for plinabulin for the CIN and NSCLC indications, as well as to advance its immuno-oncology pipeline and protein degradation research platform.
Anticipated Milestones
The following outlines the Company's anticipated upcoming milestones and projected timelines:
BeyondSpring is a global, clinical-stage biopharmaceutical company focused on the development of innovative cancer therapies. BeyondSpring's lead asset, plinabulin, a first-in-class agent as an immune and stem cell
modulator, is in a Phase 3 global clinical trial as a direct anticancer agent in the treatment of non-small cell lung cancer (NSCLC) and Phase 3 clinical programs in the prevention of CIN. BeyondSpring has strong R&D capabilities with a robust
pipeline in addition to plinabulin, including three immuno-oncology assets and a drug discovery platform using the protein degradation pathway, which is being developed in a subsidiary company, Seed Therapeutics, Inc. The Company also has a seasoned
management team with many years of experience bringing drugs to the global market. BeyondSpring is headquartered in New York City.
Cautionary Note Regarding Forward-Looking Statements
This press release includes forward-looking statements that are not historical facts. Words such as "will," "expect," "anticipate," "plan," "believe," "design," "may," "future," "estimate," "predict,"
"objective," "goal," or variations thereof and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are based on BeyondSpring's current knowledge and its present beliefs
and expectations regarding possible future events and are subject to risks, uncertainties and assumptions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of
several factors including, but not limited to, difficulties raising the anticipated amount needed to finance the Company's future operations on terms acceptable to the Company, if at all, unexpected results of clinical trials, delays or denial in
regulatory approval process, results that do not meet our expectations regarding the potential safety, the ultimate efficacy or clinical utility of our product candidates, increased competition in the market, and other risks described in
BeyondSpring's most recent Form 20-F on file with the U.S. Securities and Exchange Commission. All forward-looking statements made herein speak only as of the date of this release and BeyondSpring undertakes no obligation to update publicly such
forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law.
LifeSci Advisors, LLC
Darren Opland, Ph.D.
LifeSci Communications
AUDITED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2019 AND
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 2020
(Amounts in thousands of U.S. Dollars ("$"), except for number of shares and per share data)
| December 31, | September 30, | ||||||||||
| Note | 2019 | 2020 | |||||||||
| $ | $ | ||||||||||
| (Unaudited) | |||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | 35,933 | 30,874 | |||||||||
| Advances to suppliers | 4,519 | 4,328 | |||||||||
| Prepaid expenses and other current assets | 410 | 485 | |||||||||
| Total current assets | 40,862 | 35,687 | |||||||||
| Noncurrent assets: | |||||||||||
| Property and equipment, net | 3 | 209 | 189 | ||||||||
| Operating lease right-of-use assets | 2,538 | 2,340 | |||||||||
| Other noncurrent assets | 946 | 1,180 | |||||||||
| Total noncurrent assets | 3,693 | 3,709 | |||||||||
| Total assets | 44,555 | 39,396 | |||||||||
| Liabilities and equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | 2,537 | 2,191 | |||||||||
| Accrued expenses | 5,861 | 8,380 | |||||||||
| Due to related parties | 5 | 29 | - | ||||||||
| Current portion of operating lease liabilities | 537 | 697 | |||||||||
| Other current liabilities | 11 | 1,089 | 1,551 | ||||||||
| Total current liabilities | 10,053 | 12,819 | |||||||||
| Noncurrent liabilities: | |||||||||||
| Long-term loans | 4 | 1,436 | 2,108 | ||||||||
| Operating lease liabilities | 1,935 | 1,546 | |||||||||
| Total noncurrent liabilities | 3,371 | 3,654 | |||||||||
| Total liabilities | 13,424 | 16,473 | |||||||||
| Equity: | |||||||||||
| Ordinary shares ($0.0001 par value; 500,000,000 shares authorized; 27,885,613 and 30,516,401 shares issued and outstanding as of December 31, 2019 and September 30, 2020, respectively) | 7 | 3 | 3 | ||||||||
| Additional paid-in capital | 7 | 246,979 | 284,310 | ||||||||
| Accumulated deficit | 7 | (216,845 | ) | (260,222 | ) | ||||||
| Accumulated other comprehensive income (loss) | 7 | 140 | (47 | ) | |||||||
| Total BeyondSpring Inc.'s shareholders' equity | 30,277 | 24,044 | |||||||||
| Noncontrolling interests | 7 | 854 | (1,121 | ) | |||||||
| Total equity | 31,131 | 22,923 | |||||||||
| Total liabilities and equity | 44,555 | 39,396 |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE LOSS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2020
(Amounts in thousands of U.S. Dollars ("$"), except for number of shares and per share data)
| Three months ended | Nine months ended | ||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||
| Note | 2019 | 2020 | 2019 | 2020 | |||||||||||||||
| $ | $ | $ | $ | ||||||||||||||||
| Revenue | - | - | - | - | |||||||||||||||
| Operating expenses | |||||||||||||||||||
| Research and development | (7,230 | ) | (8,637 | ) | (18,762 | ) | (33,369 | ) | |||||||||||
| General and administrative | (2,474 | ) | (6,710 | ) | (6,260 | ) | (12,227 | ) | |||||||||||
| Loss from operations | (9,704 | ) | (15,347 | ) | (25,022 | ) | (45,596 | ) | |||||||||||
| Foreign exchange (loss) gain, net | (131 | ) | 174 | (127 | ) | 109 | |||||||||||||
| Interest expense | (46 | ) | (21 | ) | (186 | ) | (63 | ) | |||||||||||
| Interest income | 57 | 10 | 64 | 102 | |||||||||||||||
| Other income | - | - | - | 3 | |||||||||||||||
| Loss before income tax | (9,824 | ) | (15,184 | ) | (25,271 | ) | (45,445 | ) | |||||||||||
| Income tax benefit | 6 | - | - | - | - | ||||||||||||||
| Net loss | (9,824 | ) | (15,184 | ) | (25,271 | ) | (45,445 | ) | |||||||||||
| Less: Net loss attributable to noncontrolling interests | (457 | ) | (644 | ) | (1,259 | ) | (2,068 | ) | |||||||||||
| Net loss attributable to BeyondSpring Inc. | (9,367 | ) | (14,540 | ) | (24,012 | ) | (43,377 | ) | |||||||||||
| Net loss per share | |||||||||||||||||||
| Basic and diluted | 10 | (0.37 | ) | (0.48 | ) | (1.01 | ) | (1.51 | ) | ||||||||||
| Weighted-average shares outstanding | |||||||||||||||||||
| Basic and diluted | 10 | 25,309,776 | 30,303,093 | 23,819,453 | 28,658,215 | ||||||||||||||
| Other comprehensive loss, net of tax of nil: | |||||||||||||||||||
| Foreign currency translation adjustment gain (loss) | 113 | (277 | ) | 144 | (226 | ) | |||||||||||||
| Comprehensive loss | (9,711 | ) | (15,461 | ) | (25,127 | ) | (45,671 | ) | |||||||||||
| Less: Comprehensive loss attributable to noncontrolling interests | (494 | ) | (677 | ) | (1,298 | ) | (2,107 | ) | |||||||||||
| Comprehensive loss attributable to BeyondSpring Inc. | (9,217 | ) | (14,784 | ) | (23,829 | ) | (43,564 | ) |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2020
(Amounts in thousands of U.S. Dollars ("$"))
| Nine months ended September 30, | |||||||||||
| Note | 2019 | 2020 | |||||||||
| $ | $ | ||||||||||
| Operating activities: | |||||||||||
| Net loss | (25,271 | ) | (45,445 | ) | |||||||
| Adjustments to reconcile net loss to net cash from operating activities: | |||||||||||
| Share-based compensation | 12 | 1,750 | 6,082 | ||||||||
| Depreciation expenses | 3 | 61 | 54 | ||||||||
| Non-cash operating lease expense | 379 | 457 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Advances to suppliers | (3,992 | ) | 191 | ||||||||
| Due from related parties | 481 | - | |||||||||
| Prepaid expenses and other current assets | (89 | ) | ( 75 | ) | |||||||
| Other noncurrent assets | (68 | ) | (234 | ) | |||||||
| Accounts payable | (7,638 | ) | (346 | ) | |||||||
| Accrued expenses | (705 | ) | 2,519 | ||||||||
| Operating lease liabilities | (431 | ) | (488 | ) | |||||||
| Other current liabilities | 43 | 502 | |||||||||
| Net cash used in operating activities | (35,480 | ) | (36,783 | ) | |||||||
| Investing activities: | |||||||||||
| Acquisitions of property and equipment | (4 | ) | (34 | ) | |||||||
| Net cash used in investing activities | (4 | ) | (34 | ) | |||||||
| Financing activities: | |||||||||||
| Proceeds from issuance of ordinary shares, net of underwriting discounts and commissions | 44,957 | 31,933 | |||||||||
| Capital contributions from noncontrolling interests | 10,083 | - | |||||||||
| Payments of offering costs | (318 | ) | (594 | ) | |||||||
| Proceeds from loans | 4 | 2,986 | 635 | ||||||||
| Proceeds from related party borrowings | 5 | 3,328 | 32 | ||||||||
| Repayment of loans | (1,493 | ) | - | ||||||||
| Repayment of related party borrowings | 5 | (3,328 | ) | (61 | ) | ||||||
| Net cash provided by financing activities | 56,215 | 31,945 | |||||||||
| Effect of foreign exchange rate changes, net | 58 | (187 | ) | ||||||||
| Net increase/(decrease) in cash and cash equivalents | 20,789 | (5,059 | ) | ||||||||
| Cash and cash equivalents at beginning of period | 3,889 | 35,933 | |||||||||
| Cash and cash equivalents at end of period | 24,678 | 30,874 | |||||||||
| Supplemental disclosures: | |||||||||||
| Interest paid | 83 | 60 | |||||||||
| Non-cash activities: | |||||||||||
| Operating right-of-use assets obtained in exchange for operating lease liabilities | - | 259 |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands of U.S. Dollars ("$") and Renminbi ("RMB"), except for number of shares and per share data)
BeyondSpring Inc. (the "Company") was incorporated in the Cayman Islands on November 21, 2014. The Company and its subsidiaries (collectively, the "Group") are principally engaged in clinical stage
biopharmaceutical activities focused on the development of innovative cancer therapies. The Company is under the control of Mr. Linqing Jia and Dr. Lan Huang as a couple (collectively, the "Founders") since its incorporation.
On May 21, 2019, the Company entered into a sales agreement with Jefferies LLC ("Jefferies") to act as an agent in selling the Company's ordinary shares in an at-the-market ("ATM") offering
program. As of September 30, 2020, the Company received aggregate gross proceeds of $13,185 on 630,228 ordinary shares sold in respect thereof.
In June 2020, the Company completed a public offering of an aggregate of 2,219,500 ordinary shares of the Company at a public offering price of $13.0 per share for gross proceeds of $28,854.
On June 18, 2020, the Company entered into a share subscription agreement for the sale of an aggregate of 384,615 ordinary shares at $13.0 per share in a private placement transaction (the "Private
Placement"). Gross proceeds of $5,000 was received in July 2020.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands of U.S. Dollars ("$") and Renminbi ("RMB"), except for number of shares and per share data)
As of September 30, 2020, the subsidiaries of the Company are as follows:
| Name of company | Place of incorporation | Date of incorporation | Percentage of ownership by the Company | Principal activities | ||||
| BeyondSpring Pharmaceuticals Inc. ("BeyondSpring US") | Delaware, United States of America ("U.S.") | June 18, 2013 | 100% | Clinical trial activities | ||||
| BeyondSpring Ltd. | The British Virgin Islands ("BVI") | December 3, 2014 | 100% | Holding company | ||||
| BeyondSpring (HK) Limited ("BeyondSpring HK") | Hong Kong | January 13, 2015 | 100% | Holding company | ||||
| Wanchun Biotechnology Limited ("BVI Biotech") | BVI | April 1, 2015 | 100% | Holding company | ||||
| Wanchun Biotechnology (Shenzhen) Ltd. ("Wanchun Shenzhen") | The People's Republic of China ("PRC") | April 23, 2015 | 100% | Holding company | ||||
| Dalian Wanchunbulin Pharmaceuticals Ltd. ("Wanchunbulin") | PRC | May 6, 2015 | 57.97% | Clinical trial activities | ||||
| BeyondSpring Pharmaceuticals Australia PTY Ltd. ("BeyondSpring Australia") | Australia | March 3, 2016 | 100% | Clinical trial activities | ||||
| Beijing Wanchun Pharmaceutical Technology Ltd. ("Beijing Wanchun") | PRC | May 21, 2018 | 57.97% | Clinical trial activities | ||||
| SEED Therapeutics Inc. ("SEED") | BVI | June 25, 2019 | 100% | Pre-clinical development activities | ||||
| SEED Technology Limited ("SEED Technology") | BVI | December 9, 2019 | 57.97% | Holding company |
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands of U.S. Dollars ("$") and Renminbi ("RMB"), except for number of shares and per share data)
The accompanying unaudited interim condensed consolidated balance sheet as of September 30, 2020, the unaudited interim condensed consolidated statements of comprehensive loss for the three and
nine months ended September 30, 2019 and 2020, the cash flows for the nine months ended September 30, 2019 and 2020, and the related footnote disclosures are unaudited. These unaudited interim condensed consolidated financial statements of the
Company have been prepared in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP") for interim financial information using accounting policies that are consistent with those used in the preparation of the Company's audited
consolidated financial statements for the year ended December 31, 2019. Accordingly, these unaudited interim condensed consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for annual financial
In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all normal recurring adjustments necessary to present fairly the financial
position, operating results and cash flows of the Company for each of the periods presented. The results of operations for the three and nine months ended September 30, 2020 are not necessarily indicative of results to be expected for any other
interim period or for the full year of 2020. The consolidated balance sheet as of December 31, 2019 was derived from the audited consolidated financial statements at that date but does not include all of the disclosures required by U.S. GAAP for
annual financial statements. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements for the year ended December 31, 2019.
Basis of consolidation
The unaudited interim condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant intercompany transactions and balances
between the Company and its subsidiaries are eliminated upon consolidation.
According to Accounting Standards Codification ("ASC") 205-40, Presentation of Financial Statements - Going Concern ("ASC 205-40"), management must
evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the company's ability to continue as a going concern within one year after the date that the financial statements are issued. This
evaluation initially does not take into consideration the potential mitigating effect of management's plans that have not been fully implemented as of the date the financial statements are issued. When substantial doubt exists under this methodology,
management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the company's ability to continue as a going concern. The mitigating effect of management's plans, however, is only considered if both (1)
it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise
substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued.
The Company has incurred operating losses and negative cash flows from operations since inception. To date, the Company has no product revenue and management expects operating losses to continue
for the foreseeable future, and has primarily funded these losses through equity financings. The Company incurred a net loss of $45,445 during the nine months ended September 30, 2020 and has an accumulated deficit of $260,222 as of September 30,
2020. Net cash used in operations was approximately $36,783 for the nine months ended September 30, 2020. As of September 30, 2020, the Company had $22,868 net current assets and $30,874 cash and cash
equivalents on hand.