QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
(State or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S. Employer Identification No.)
|
|
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
Large accelerated filer ☐
|
Accelerated filer ☐
|
|
|
Smaller reporting company
|
|
Emerging growth company
|
PART I FINANCIAL INFORMATION
|
||
Item 1.
|
Financial Statements
|
|
1
|
||
2
|
||
3
|
||
4
|
||
5
|
||
Item 2.
|
22
|
|
Item 3.
|
36
|
|
Item 4.
|
37
|
|
38
|
||
Item 1.
|
38
|
|
Item 1A.
|
38
|
|
Item 2.
|
68
|
|
Item 3.
|
68
|
|
Item 4.
|
68
|
|
Item 5.
|
68
|
|
Item 6.
|
68
|
|
69
|
• |
our ability to manufacture BIVIGAM and ASCENIV on a commercial scale and further commercialize these products as a result of their approval by the U.S. Food and
Drug Administration (the “FDA”) in 2019;
|
• |
our plans to develop, manufacture, market, launch and expand our commercial infrastructure and commercialize our current and future products and the success of such
efforts;
|
• |
the safety, efficacy and expected timing of and our ability to obtain and maintain regulatory approvals for our current products and product candidates, and the
labeling or nature of any such approvals;
|
• |
the achievement of or expected timing, progress and results of clinical development, clinical trials and potential regulatory approvals for our product candidates;
|
• |
our dependence upon our third-party customers and vendors and their compliance with applicable regulatory requirements;
|
• |
our belief that we have addressed the delays experienced with final drug product Current Good Manufacturing Practices (“cGMP”) release testing by our third-party
vendors by adding additional release testing laboratories to our FDA-approved consortium listed in our drug approval documents;
|
• |
our ability to obtain adequate quantities of FDA-approved plasma with proper specifications;
|
• |
our plans to increase our supplies of source plasma, which include plasma collection center expansion, our ability to obtain and maintain regulatory compliance and
receive FDA approvals of new plasma collection centers and reliance on third-party supply agreements as well as any extensions to such agreements;
|
• |
the potential indications for our products and product candidates;
|
• |
potential investigational new product applications;
|
• |
the acceptability of any of our products, including BIVIGAM, ASCENIV and Nabi-HB, for any purpose, including FDA-approved indications, by physicians, patients or
payers;
|
• |
our plans to evaluate the clinical and regulatory paths to grow the ASCENIV franchise through expanded FDA-approved uses;
|
• |
Federal, state and local regulatory and business review processes and timing by such governmental and regulatory agencies of our business and regulatory
submissions;
|
• |
concurrence by the FDA with our conclusions concerning our products and product candidates;
|
• |
the comparability of results of our hyperimmune and immune globulin (“IG”) products to other comparably run hyperimmune and immune globulin clinical trials;
|
• |
the potential for ASCENIV and BIVIGAM to provide meaningful clinical improvement for patients living with Primary Humoral Immunodeficiency (“PI”), also known as
Primary Immunodeficiency Disease (“PIDD”) or Inborn Errors of Immunity, or other immune deficiencies or any other condition for which the products may be prescribed or evaluated;
|
• |
our ability to market and promote Nabi-HB in a highly competitive environment with increasing competition from other antiviral therapies and to generate meaningful
revenues from this product;
|
• |
our intellectual property position and the defense thereof, including our expectations regarding the scope of patent protection with respect to ASCENIV or other
future pipeline product candidates;
|
• |
our manufacturing capabilities, third-party contractor capabilities and vertical integration strategy;
|
• |
our plans related to the expansion and efficiencies of our manufacturing capacity, yield improvements, supply-chain robustness, in-house fill-finish capabilities,
distribution and other collaborative agreements and the success of such endeavors;
|
• |
our estimates regarding revenues, expenses, capital requirements, timing to profitability and positive cash flows and the need for and availability of additional
financing;
|
• |
possible or likely reimbursement levels for our currently marketed products;
|
• |
estimates regarding market size, projected growth and sales of our existing products as well as our expectations of market acceptance of ASCENIV and BIVIGAM;
|
• |
effects of the coronavirus COVID-19 pandemic and other potential pandemics on our business, financial condition, liquidity and results of operations, and our
ability to continue operations in the same manner as previously conducted prior to the macroeconomic effects of the COVID-19 pandemic and other potential pandemics; and
|
• |
future domestic and global economic conditions including, but not limited to, supply chain constraints, inflationary pressures or performance.
|
Item 1. |
Financial Statements.
|
June 30, | December 31, | |||||||
2023
|
2022
|
|||||||
ASSETS |
(Unaudited)
|
|||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Accounts receivable, net
|
|
|
||||||
Inventories
|
|
|
||||||
Prepaid expenses and other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
Property and equipment, net
|
|
|
||||||
Intangible assets, net
|
|
|
||||||
Goodwill
|
|
|
||||||
Right to use assets
|
|
|
||||||
Deposits and other assets
|
|
|
||||||
TOTAL ASSETS
|
$
|
|
$
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
|
$
|
|
||||
Accrued expenses and other current liabilities
|
|
|
||||||
Current portion of deferred revenue
|
|
|
||||||
Current portion of lease obligations
|
|
|
||||||
Total current liabilities
|
|
|
||||||
Senior notes payable, net of discount
|
|
|
||||||
Deferred revenue, net of current portion
|
|
|
||||||
End of term fee |
||||||||
Lease obligations, net of current portion
|
|
|
||||||
Other non-current liabilities
|
|
|
||||||
TOTAL LIABILITIES
|
|
|
||||||
COMMITMENTS AND CONTINGENCIES
|
||||||||
STOCKHOLDERS’ EQUITY
|
||||||||
Preferred Stock, $
|
|
|
||||||
Common Stock - voting, $
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Accumulated deficit
|
(
|
)
|
(
|
)
|
||||
TOTAL STOCKHOLDERS’ EQUITY
|
|
|
||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
|
$
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
REVENUES
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Cost of product revenue | ||||||||||||||||
Gross profit |
||||||||||||||||
OPERATING EXPENSES:
|
||||||||||||||||
Research and development
|
|
|
|
|
||||||||||||
Plasma center operating expenses
|
|
|
|
|
||||||||||||
Amortization of intangible assets
|
|
|
|
|
||||||||||||
Selling, general and administrative
|
|
|
|
|
||||||||||||
Total operating expenses
|
|
|
|
|
||||||||||||
LOSS FROM OPERATIONS
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
OTHER INCOME (EXPENSE):
|
||||||||||||||||
Interest income
|
|
|
|
|
||||||||||||
Interest expense
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Loss on extinguishment of debt | ( |
) | ||||||||||||||
Other expense
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Other expense, net
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
NET LOSS
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||
BASIC AND DILUTED LOSS PER COMMON SHARE
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
|
||||||||||||||||
Basic and Diluted
|
|
|
|
|
Additional | Total | |||||||||||||||||||
Common Stock
|
Paid-in
|
Accumulated
|
Stockholders’
|
|||||||||||||||||
Shares
|
Amount
|
Capital
|
Deficit
|
Equity
|
||||||||||||||||
Balance at December 31, 2022
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Stock-based compensation
|
-
|
|
|
|
|
|||||||||||||||
Vesting of Restricted Stock Units, net of shares withheld for taxes
|
|
|
(
|
)
|
|
(
|
)
|
|||||||||||||
Exercise of stock options |
||||||||||||||||||||
Net loss
|
-
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||
Balance at March 31, 2023
|
|
|
|
(
|
)
|
|
||||||||||||||
Stock-based compensation
|
-
|
|
|
|
|
|||||||||||||||
Vesting of Restricted Stock Units, net of shares withheld for taxes
|
( |
) | ( |
) | ||||||||||||||||
Warrants issued in connection with note payable |
- |
|||||||||||||||||||
Cashless exercise of warrants |
( |
) | ||||||||||||||||||
Exercise of stock options |
||||||||||||||||||||
Net loss
|
-
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||
Balance at June 30, 2023 | $ | $ | $ | ( |
) | $ |
Additional | Total | |||||||||||||||||||
Common Stock
|
Paid-in
|
Accumulated
|
Stockholders’
|
|||||||||||||||||
Shares
|
Amount
|
Capital
|
Deficit
|
Equity
|
||||||||||||||||
Balance at December 31, 2021
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Warrants issued in connection with notes payable
|
-
|
|
|
|
||||||||||||||||
Stock-based compensation |
- | |||||||||||||||||||
Vesting of Restricted Stock Units, net of shares withheld for taxes and retired | ( |
) | ( |
) | ||||||||||||||||
Net loss
|
- | ( |
) | ( |
) | |||||||||||||||
Balance at March 31, 2022
|
|
|
|
(
|
)
|
|
||||||||||||||
Stock-based compensation
|
-
|
|
|
|
|
|||||||||||||||
Vesting of Restricted Stock Units, net of shares withheld for taxes and retired |
||||||||||||||||||||
Net loss
|
-
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||
Balance at June 30, 2022 | $ | $ | $ | ( |
) | $ |
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net loss
|
$ | ( |
) |
$
|
(
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation and amortization
|
|
|
||||||
Loss on disposal of fixed assets
|
|
|
||||||
Interest paid in kind | ||||||||
Stock-based compensation
|
|
|
||||||
Amortization of debt discount
|
|
|
||||||
Loss on extinguishment of debt
|
||||||||
Amortization of license revenue
|
(
|
)
|
(
|
)
|
||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(
|
)
|
|
|||||
Inventories
|
|
(
|
)
|
|||||
Prepaid expenses and other current assets
|
(
|
)
|
(
|
)
|
||||
Deposits and other assets
|
(
|
)
|
|
|||||
Accounts payable
|
(
|
)
|
(
|
)
|
||||
Accrued expenses
|
|
(
|
)
|
|||||
Other current and non-current liabilities
|
(
|
)
|
(
|
)
|
||||
Net cash used in operating activities
|
(
|
)
|
(
|
)
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Purchase of property and equipment
|
(
|
)
|
(
|
)
|
||||
Net cash used in investing activities
|
(
|
)
|
(
|
)
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Principal payments on notes payable
|
( |
) | ||||||
Payment of debt refinancing fees
|
|
(
|
)
|
|||||
Proceeds from issuance of note payable
|
||||||||
Taxes paid on vested Restricted Stock Units
|
(
|
)
|
(
|
)
|
||||
Payments on finance lease obligations
|
(
|
)
|
(
|
)
|
||||
Proceeds from the exercise of stock options | ||||||||
Payment of deferred financing fees
|
( |
) | ||||||
Net cash (used in) provided by financing activities
|
(
|
)
|
|
|||||
Net (decrease) increase in cash and cash equivalents
|
(
|
)
|
|
|||||
Cash and cash equivalents - beginning of period
|
|
|
||||||
Cash and cash equivalents - end of period
|
$
|
|
$
|
|
1. |
ORGANIZATION AND BUSINESS
|
2. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
For the Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Stock options
|
|
|
||||||
Restricted Stock Units
|
|
|
||||||
Warrants
|
|
|
||||||
|
|
3. |
INVENTORIES
|
June 30,
2023
|
December 31,
2022
|
|||||||
Raw materials
|
$
|
|
$
|
|
||||
Work-in-process
|
|
|
||||||
Finished goods
|
|
|
||||||
Total inventories
|
$
|
|
$
|
|
4. |
INTANGIBLE ASSETS
|
June 30, 2023
|
December 31, 2022
|
|||||||||||||||||||||||
Accumulated | Accumulated | |||||||||||||||||||||||
Cost
|
Amortization
|
Net
|
Cost
|
Amortization
|
Net
|
|||||||||||||||||||
Trademark and other intangible rights related to Nabi-HB
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||
Rights to intermediates
|
|
|
|
|
|
|
||||||||||||||||||
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Remainder of 2023
|
$
|
|
||
2024
|
|
5. |
PROPERTY AND EQUIPMENT
|
June 30, 2023
|
December 31, 2022
|
|||||||
Manufacturing and laboratory equipment
|
$
|
|
$
|
|
||||
Office equipment and computer software
|
|
|
||||||
Furniture and fixtures
|
|
|
||||||
Construction in process
|
|
|
||||||
Leasehold improvements
|
|
|
||||||
Land
|
|
|
||||||
Buildings and building improvements
|
|
|
||||||
|
|
|||||||
Less: Accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
Total property, plant and equipment, net
|
$
|
|
$
|
|
6. |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
|
June 30, 2023
|
December 31, 2022
|
|||||||
Accrued rebates
|
$
|
|
$
|
|
||||
Accrued distribution fees
|
|
|
||||||
Accrued incentives
|
|
|
||||||
Accrued testing
|
|
|
||||||
Accrued payroll and other compensation
|
|
|
||||||
Other
|
|
|
||||||
Total accrued expenses and other current liabilities
|
$
|
|
$
|
|
7. |
DEBT
|
June 30, 2023
|
December 31, 2022
|
|||||||
Notes payable
|
$
|
|
$
|
|
||||
Less:
|
||||||||
Debt discount
|
(
|
)
|
(
|
)
|
||||
Senior notes payable
|
$
|
|
$
|
|
8. |
STOCKHOLDERS’ EQUITY
|
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Expected term
|
|
|
||||||
Volatility
|
|
%
|
|
%
|
||||
Dividend yield
|
|
|
||||||
Risk-free interest rate
|
|
%
|
|
%
|
Shares
|
Weighted
Average
Exercise Price
|
|||||||
Options outstanding, vested and expected to vest at December 31, 2022
|
|
$
|
|
|||||
Forfeited
|
(
|
)
|
$
|
|
||||
Expired
|
(
|
)
|
$
|
|
||||
Granted
|
|
$
|
|
|||||
Exercised | ( |
) | $ | |||||
Options outstanding, vested and expected to vest at June 30, 2023
|
|
$
|
|
|||||
Options exercisable
|
|
$
|
|
Shares
|
Weighted
Average Grant
Date Fair Value
|
|||||||
Balance at December 31, 2022
|
|
$
|
|
|||||
Granted
|
|
$
|
|
|||||
Vested
|
(
|
)
|
$
|
|
||||
Forfeited
|
(
|
)
|
$
|
|
||||
Balance at June 30, 2023
|
|
$
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Research and development
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Plasma center operating expenses
|
|
|
|
|
||||||||||||
Selling, general and administrative
|
|
|
|
|
||||||||||||
Cost of product revenue
|
|
|
|
|
||||||||||||
Total stock-based compensation expense
|
$
|
|
$
|
|
$
|
|
$
|
|
9. |
RELATED PARTY TRANSACTIONS
|
10. |
COMMITMENTS AND CONTINGENCIES
|
11. |
SEGMENTS
|
Three Months Ended June 30, 2023
|
||||||||||||||||
ADMA
BioManufacturing
|
Plasma Collection
Centers
|
Corporate
|
Consolidated
|
|||||||||||||
Revenues
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Cost of product revenue
|
|
|
|
|
||||||||||||
Income (loss) from operations
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Interest and other (expense) income, net
|
(
|
)
|
|
(
|
)
|
(
|
)
|
|||||||||
Net income (loss)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Total assets
|
|
|
|
|
||||||||||||
Depreciation and amortization expense
|
Three Months Ended June 30, 2022
|
||||||||||||||||
ADMA |
Plasma Collection
|
|||||||||||||||
BioManufacturing
|
Centers
|
Corporate
|
Consolidated
|
|||||||||||||
Revenues
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Cost of product revenue
|
|
|
|
|
||||||||||||
Loss from operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Interest and other expense, net
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net loss
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total assets
|
|
|
|
|
||||||||||||
Depreciation and amortization expense |
Six Months Ended June 30, 2023
|
||||||||||||||||
ADMA |
Plasma Collection
|
|||||||||||||||
BioManufacturing
|
Centers
|
Corporate
|
Consolidated
|
|||||||||||||
Revenues
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Cost of product revenue
|
|
|
|
|
||||||||||||
Income (loss) from operations
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Interest and other expense, net
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Net income (loss)
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Capital expenditures
|
|
|
|
|
||||||||||||
Depreciation and amortization expense
|
|
|
|
|
Six Months Ended June 30, 2022
|
||||||||||||||||
ADMA |
Plasma Collection
|
|||||||||||||||
BioManufacturing
|
Centers
|
Corporate
|
Consolidated
|
|||||||||||||
Revenues
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Cost of product revenue
|
|
|
|
|
||||||||||||
Loss from operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Interest and other expense, net
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Loss on extinguishment of debt |
( |
) | ( |
) | ||||||||||||
Net loss
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Capital expenditures
|
|
|
|
|
||||||||||||
Depreciation and amortization expense
|
|
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
United States
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
International
|
|
|
|
|
||||||||||||
Total revenues
|
$
|
|
$
|
|
$
|
|
$
|
|
12. |
LEASE OBLIGATIONS
|
Remainder of 2023
|
$
|
|
|||
Year ended December 31, 2024
|
|
||||
2025
|
|
||||
2026
|
|
||||
2027
|
|
||||
2028
|
|
||||
Thereafter
|
|
||||
Total payments
|
|
||||
Less: imputed interest
|
(
|
)
|
|||
Current portion
|
(
|
)
|
|||
Balance at June 30, 2023
|
$
|
|
13. |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
2023
|
2022
|
|||||||
SUPPLEMENTAL CASH FLOW INFORMATION:
|
||||||||
Cash paid for interest
|
$
|
|
$
|
|
||||
Noncash Financing and Investing Activities:
|
||||||||
Equipment acquired reflected in accounts payable and accrued liabilities
|
$
|
|
$
|
|
||||
Right-to-use assets in exchange for lease obligations
|
$ |
$ |
||||||
Warrants issued in connection with notes payable
|
$ | $ |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
• |
A significant adverse change in legal factors or in the business climate that could affect the value of the asset.
|
• |
Significant and continued cash flow losses.
|
• |
A significant adverse change in the extent or manner in which an asset is used, such as a restriction imposed by the FDA or other regulatory authorities that could affect our ability to manufacture our products using a particular
asset.
|
• |
An expectation of losses or reduced profits associated with an asset. This could result, for example, from the introduction of a competitor’s product that impacts projected revenue growth, or a change in the acceptance of a product
by patients, physicians and payers that results in an inability to sustain projected product revenues.
|
Three Months Ended June 30,
|
||||||||||||
2023
|
2022
|
Increase (Decrease)
|
||||||||||
Revenues
|
$
|
60,123,191
|
$
|
33,905,007
|
$
|
26,218,184
|
||||||
Cost of product revenue
|
43,433,188
|
26,135,614
|
17,297,574
|
|||||||||
Gross profit
|
16,690,003
|
7,769,393
|
8,920,610
|
|||||||||
Research and development expenses
|
1,403,260
|
873,386
|
529,874
|
|||||||||
Plasma center operating expenses
|
1,333,424
|
3,921,486
|
(2,588,062
|
)
|
||||||||
Amortization of intangibles
|
178,838
|
178,838
|
-
|
|||||||||
Selling, general and administrative expenses
|
14,247,558
|
11,970,422
|
2,277,136
|
|||||||||
Loss from operations
|
(473,077
|
)
|
(9,174,739
|
)
|
8,701,662
|
|||||||
Interest expense
|
(6,299,107
|
)
|
(4,573,015
|
)
|
(1,726,092
|
)
|
||||||
Other income (expense), net
|
401,477
|
(17,152
|
)
|
418,629
|
||||||||
Net loss
|
$
|
(6,370,707
|
)
|
$
|
(13,764,906
|
)
|
$
|
7,394,199
|
||||
Adjusted EBITDA *
|
$
|
6,432,987
|
$
|
(6,276,562
|
)
|
$
|
12,709,549
|
Six Months Ended June 30,
|
||||||||||||
2023
|
2022
|
Increase (Decrease)
|
||||||||||
Revenues
|
$
|
117,036,725
|
$
|
63,008,100
|
$
|
54,028,625
|
||||||
Cost of product revenue
|
83,833,732
|
51,576,660
|
32,257,072
|
|||||||||
Gross profit
|
33,202,993
|
11,431,440
|
21,771,553
|
|||||||||
Research and development expenses
|
2,258,611
|
1,497,497
|
761,114
|
|||||||||
Plasma center operating expenses
|
3,113,887
|
7,896,075
|
(4,782,188
|
)
|
||||||||
Amortization of intangibles
|
357,676
|
357,676
|
-
|
|||||||||
Selling, general and administrative expenses
|
28,759,214
|
25,669,997
|
3,089,217
|
|||||||||
Loss from operations
|
(1,286,395
|
)
|
(23,989,805
|
)
|
22,703,410
|
|||||||
Interest expense
|
(12,414,591
|
)
|
(7,962,053
|
)
|
(4,452,538
|
)
|
||||||
Loss on extinguishment of debt
|
-
|
(6,669,941
|
)
|
6,669,941
|
||||||||
Other income (expense), net
|
541,464
|
(150,964
|
)
|
692,428
|
||||||||
Net loss
|
$
|
(13,159,522
|
)
|
$
|
(38,772,763
|
)
|
$
|
25,613,241
|
||||
Adjusted EBITDA *
|
$
|
8,902,787
|
$
|
(17,993,834
|
)
|
$
|
26,896,621
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Net loss
|
$
|
(6,370,707
|
)
|
$
|
(13,764,906
|
)
|
$
|
(13,159,522
|
)
|
$
|
(38,772,763
|
)
|
||||
Depreciation
|
1,918,739
|
1,545,444
|
3,772,866
|
2,956,824
|
||||||||||||
Amortization
|
178,838
|
178,838
|
357,676
|
357,676
|
||||||||||||
Interest expense
|
6,299,107
|
4,573,015
|
12,414,591
|
7,962,053
|
||||||||||||
EBITDA
|
2,025,977
|
(7,467,609
|
)
|
3,385,611
|
(27,496,210
|
)
|
||||||||||
Stock-based compensation
|
1,637,038
|
1,191,047
|
2,747,204
|
2,832,435
|
||||||||||||
IT systems disruption
|
2,769,972
|
-
|
2,769,972
|
-
|
||||||||||||
Loss on extinguishment of debt
|
-
|
-
|
-
|
6,669,941
|
||||||||||||
Adjusted EBITDA
|
$
|
6,432,987
|
$
|
(6,276,562
|
)
|
$
|
8,902,787
|
$
|
(17,993,834
|
)
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2023
|
2022
|
2023
|
2022
|
|||||||||||||
Net loss
|
$
|
(6,370,707
|
)
|
$
|
(13,764,906
|
)
|
$
|
(13,159,522
|
)
|
$
|
(38,772,763
|
)
|
||||
IT systems disruption
|
2,769,972
|
-
|
2,769,972
|
-
|
||||||||||||
Adjusted net loss
|
$
|
(3,600,735
|
)
|
$
|
(13,764,906
|
)
|
$
|
(10,389,550
|
)
|
$
|
(38,772,763
|
)
|
• |
The collection and procurement of raw material plasma and other raw materials necessary to maintain and scale up our manufacturing operations;
|
• |
Employee compensation and benefits;
|
• |
Capital expenditures to complete the buildout for and maintain our plasma collection facilities and for equipment upgrades and capacity expansion at the Boca Facility;
|
• |
Plasma donor fees and plasma center supplies;
|
• |
Interest on our debt;
|
• |
Marketing programs, medical education and continued commercialization efforts;
|
• |
Boca Facility maintenance, upgrades, repairs and supplies; and
|
• |
Conducting required post-marketing clinical trials for our FDA-approved products.
|
• |
Continuous improvements and updates to our IT infrastructure, laboratory equipment and assays, and facilities and engineering equipment.
|
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Net cash used in operating activities
|
$
|
(20,781,030
|
)
|
$
|
(38,844,181
|
)
|
||
Net cash used in investing activities
|
(2,817,229
|
)
|
(6,782,169
|
)
|
||||
Net cash (used in) provided by financing activities
|
(410,394
|
)
|
46,952,285
|
|||||
Net change in cash and cash equivalents
|
(24,008,653
|
)
|
1,325,935
|
|||||
Cash and cash equivalents - beginning of period
|
86,521,542
|
51,089,118
|
||||||
Cash and cash equivalents - end of period
|
$
|
62,512,889
|
$
|
52,415,053
|
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Net loss
|
$
|
(13,159,522
|
)
|
$
|
(38,772,763
|
)
|
||
Non-cash expenses, gains and losses
|
9,965,335
|
14,720,818
|
||||||
Changes in accounts receivable
|
(21,226,562
|
)
|
9,693,011
|
|||||
Changes in inventories
|
1,499,984
|
(21,351,368
|
)
|
|||||
Changes in prepaid expenses and other current assets
|
(123,590
|
)
|
(1,060,683
|
)
|
||||
Changes in accounts payable and accrued expenses
|
3,593,515
|
(2,502,982
|
)
|
|||||
Other
|
(1,330,190
|
)
|
429,786
|
|||||
Cash used in operations
|
$
|
(20,781,030
|
)
|
$
|
(38,844,181
|
)
|
Item 3. |
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 4. |
Controls and Procedures.
|
Item 1. |
Legal Proceedings.
|
Item 1A. |
Risk Factors
|
• |
We have a history of losses and we may, in the future, need to raise additional capital to operate our business, which may not be available on favorable terms, if at all.
|
• |
We are currently not profitable and may never become profitable.
|
• |
The COVID-19 pandemic or other pandemics and efforts to reduce their spread has significantly affected worldwide economic conditions and could have a material adverse impact on our business, liquidity, financial condition and results
of operations, as well as a change to the overall market size and potential for our products.
|
• |
We contract with third parties for the filling, packaging, testing and labeling of the drug substance we manufacture. This reliance on third parties carries the risk that the services upon which we rely may not be performed in a timely
manner or according to our specifications, which could delay the availability of our finished drug product and could adversely affect our commercialization efforts and our revenues.
|
• |
The estimates of market opportunity and forecasts of market and revenue growth included in our filings may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business could fail to
grow at similar rates, if at all.
|
• |
Both of our business segments and our facilities are subject to periodic inspections by the FDA, which, depending on the outcome of such inspections, could result in certain FDA actions, including the issuance of observations, notices,
citations or warning letters.
|
• |
Business interruptions could adversely affect our business.
|
• |
Although we have received approval from the FDA to market ASCENIV as a treatment for PIDD, our ability to market or seek approval for ASCENIV for alternative indications could be limited and FDA could require clinical trials beyond
what we may deem to be reasonable. Unless additional clinical trials are successfully conducted and the FDA approves a BLA or other required submission for review, we may not be authorized to market ASCENIV for any other indication.
|
• |
With the approval to market ASCENIV, BIVIGAM and Nabi-HB, there can be no assurance that we will be successful in further developing and expanding commercial operations or balancing our research and development activities with our
commercialization activities.
|
• |
We depend on third-party researchers, developers and vendors to develop, manufacture, supply materials for or test our products and product candidates, and such parties are outside of our control.
|
• |
We may be unable to successfully expand our manufacturing processes to fulfill demand for our products or increase our production capabilities through the addition of new equipment, including if we do not obtain requisite approval from
the FDA.
|
• |
Our products, and any additional products for which we may obtain marketing approval in the future, could be subject to post-marketing restrictions or withdrawal from the market and we could be subject to substantial penalties if we
fail to comply with regulatory requirements or if we experience unanticipated problems with our products following approval.
|
• |
Historically, a few customers have accounted for a significant amount of our total revenue and accounts receivable and the loss of any of these customers could have a material adverse effect on our business, results of operations and
financial condition.
|
• |
Issues with product quality and compliance could have a material adverse effect upon our business, subject us to regulatory actions and cause a loss of customer confidence in us or our products.
|
• |
If physicians, payers and patients do not accept and use our current products or our future product candidates, our ability to generate revenue from these products will be materially impaired.
|
• |
Our long-term success may depend on our ability to supplement our existing product portfolio through new product development or the in-license or acquisition of other new products, product candidates and label expansion of existing
products, and if our business development efforts are not successful, our ability to achieve profitability may be adversely impacted.
|
• |
Our ADMA BioCenters operations collect information from donors in the U.S. that subjects us to consumer and health privacy laws, which could create enforcement and litigation exposure if we fail to meet their requirements.
|
• |
Our senior credit facility with Hayfin Services LLP (“Hayfin”) is subject to acceleration in specified circumstances, which may result in Hayfin taking possession and disposing of any collateral.
|
• |
If we are unable to protect our patents, trade secrets or other proprietary rights, if our patents are challenged or if our provisional patent applications do not get approved, our competitiveness and business prospects may be
materially damaged.
|
• |
Cyberattacks and other security breaches could compromise our proprietary and confidential information, which could harm our business and reputation.
|
• |
Our ability to continue to produce safe and effective products depends on the safety of our plasma supply, testing by third parties and the timing of receiving the testing results, and manufacturing processes against transmittable
diseases.
|
• |
We could become supply-constrained and our financial performance would suffer if we cannot obtain adequate quantities of FDA-approved source plasma with proper specifications or other necessary raw materials.
|
• |
The market price of our common stock may be volatile and may fluctuate in a way that is disproportionate to our operating performance.
|
• |
expand commercialization and marketing efforts;
|
• |
implement additional internal systems, controls and infrastructure;
|
• |
hire additional personnel;
|
• |
expand and build out our plasma center network; and
|
• |
expand production capacity at the Boca Facility.
|
•
|
we may be unable to identify contract fill/finishers on acceptable terms or at all because the number of potential service providers is limited and the FDA must inspect and qualify any contract manufacturers for current cGMP
compliance as part of our marketing application;
|
•
|
a new fill/finisher would have to be educated in, or develop substantially equivalent processes for, the production of our products and product candidates;
|
•
|
the COVID-19 pandemic could adversely affect our contracted fill/finishers’ operations, supply chain or workforce;
|
•
|
our contracted fill/finishers’ resources and level of expertise with plasma-derived biologics may be limited, and therefore they may require a significant amount of support from us in order to implement and maintain the
infrastructure and processes required to deliver our finished drug product;
|
•
|
our third-party fill/finishers might be unable to timely provide finished drug product in sufficient quantity to meet our commercial needs;
|
•
|
contract manufacturers may not be able to execute our inspection procedures and required tests appropriately;
|
•
|
contract manufacturers are subject to ongoing periodic unannounced inspection by the FDA and corresponding state agencies to ensure strict compliance with cGMP and other government regulations, and we do not have control over
third-party providers’ compliance with these regulations;
|
•
|
contract manufacturers may fail to comply with applicable regulatory requirements, placing them and us at risk of regulatory enforcement actions, recalls and other adverse consequences, which may negatively impact our business and
their ability to supply products to meet our development, clinical and commercial needs;
|
•
|
our third-party fill/finishers could breach or terminate their agreements with us; and
|
•
|
our contract fill/finishers may have unacceptable or inconsistent drug product quality success rates and yields, and we have no direct control over our contract fill/finishers’ ability to maintain adequate quality control, quality
assurance and qualified personnel.
|
• |
unforeseen safety issues;
|
• |
determination of dosing issues;
|
• |
lack of safety or effectiveness during clinical trials;
|
• |
slower than expected rates of patient recruitment;
|
• |
inability to monitor patients adequately during or after treatment; and
|
• |
inability or unwillingness of medical investigators to follow our clinical protocols.
|
• |
Delays in reaching, or failure to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites and our CROs;
|
• |
Regulators requiring us to perform additional or unanticipated clinical trials to obtain approval or becoming subject to additional post-marketing testing, surveillance, or REMS requirements to maintain regulatory approval;
|
• |
Failure by our third-party contractors to comply with regulatory requirements or the clinical trial protocol, or meet their contractual obligations to us in a timely manner, or at all, or our being required to engage in additional
clinical trial site monitoring;
|
• |
The cost of clinical trials of our product candidates being greater than we anticipate or our having insufficient funds for a clinical trial or to pay the substantial user fees required by FDA upon the filing of a marketing
application;
|
• |
Insufficient supply or inadequate quality of our product candidates or other materials necessary to conduct clinical trials;
|
• |
Inability to achieve sufficient study enrollment, subjects dropping out or withdrawing from our studies, delays in adding new investigators or clinical trial sites or a withdrawal of clinical trial sites;
|
• |
Flaws in our clinical trial design that are not discoverable until the clinical trial has progressed;
|
• |
Disagreement by the FDA or comparable foreign regulatory authorities with our intended indications or study design, including endpoints, or our interpretation of data from preclinical studies and clinical trials, finding that a product
candidate’s benefits do not outweigh its safety risks or requiring that we conduct additional development or study work;
|
• |
The need to make changes to our product candidates that require additional testing or that cause our product candidates to perform differently than expected;
|
• |
Global trade policies that may impact our ability to obtain raw materials and/or finished product for commercialization;
|
• |
FDA or comparable regulatory authorities taking longer than we anticipate to make decisions on our products or product candidates; and
|
• |
Potential inability to demonstrate that a product or product candidate provides an advantage over current standards of care or current or future competitive therapies in development.
|
• |
delay commercialization of, and our ability to derive revenues from, our product candidates;
|
• |
impose costly procedures on us; and
|
• |
diminish any competitive advantages that we may otherwise enjoy.
|
• |
restrictions on such products or manufacturing processes;
|
• |
restrictions on the labeling or marketing of a product;
|
• |
restrictions on product distribution or use;
|
• |
clinical holds or termination of clinical trials;
|
• |
requirements to conduct further post-marketing studies or clinical trials, implement risk mitigation strategies, or to issue corrective information;
|
• |
warning letters or untitled letters;
|
• |
withdrawal of the products from the market;
|
• |
refusal to approve pending applications or supplements to approved applications that we submit;
|
• |
recall of products;
|
• |
restrictions on coverage by third-party payers;
|
• |
fines, restitution or disgorgement of profits or revenues;
|
• |
suspension or withdrawal of marketing approvals;
|
• |
refusal to permit the import or export of products;
|
• |
FDA debarment, suspension and debarment from government programs, refusal of orders under existing government contracts, exclusion from participation in federal healthcare programs, consent decrees, deferred or non-prosecution
agreements or corporate integrity agreements;
|
• |
product seizure or detention; or
|
• |
injunctions or the imposition of civil penalties or criminal fines.
|
• |
our ability to sell our products at competitive prices;
|
• |
our ability to maintain features and quality standards for our products sufficient to meet the expectations of our customers;
|
• |
our ability to produce and deliver a sufficient quantity of our products in a timely manner to meet our customers’ requirements; and
|
• |
the impact of the ongoing COVID-19 pandemic and government responses thereto on our customers and their businesses, operations and financial condition.
|
• |
perceptions by members of the healthcare community, including physicians, about the safety and effectiveness of our products;
|
• |
cost-effectiveness of our products relative to competing products;
|
• |
availability of reimbursement for our products from government or other healthcare payers; and
|
• |
the effectiveness of marketing and distribution efforts by us and our licensees and distributors, if any.
|
• |
sales or potential sales of substantial amounts of our common stock;
|
• |
uncertainties in the equity markets related to the effects of the COVID-19 pandemic;
|
• |
delay or failure in initiating or completing preclinical or clinical trials or unsatisfactory results of these trials;
|
• |
delay in a decision by federal, state or local business regulatory authority;
|
• |
the timing of acceptance, third-party reimbursement and sales of BIVIGAM and ASCENIV;
|
• |
announcements about us or about our competitors, including clinical trial results, regulatory approvals or new product introductions;
|
• |
developments concerning our licensors or third-party vendors;
|
• |
litigation and other developments relating to our patents or other proprietary rights or those of our competitors;
|
• |
conditions in the pharmaceutical or biotechnology industries;
|
• |
governmental regulation and legislation;
|
• |
overall market volatility;
|
• |
variations in our anticipated or actual operating results; and
|
• |
change in securities analysts’ estimates of our performance, or our failure to meet analysts’ expectations.
|
• |
the inability of stockholders to call special meetings;
|
• |
classification of our Board and limitation on filling of vacancies could make it more difficult for a third party to acquire, or discourage a third party from seeking to acquire, control of our Company; and
|
• |
authorization of the issuance of “blank check” preferred stock, with such designation rights and preferences as may be determined from time to time by the Board, without any need for action by stockholders.
|
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds.
|
Item 3. |
Defaults Upon Senior Securities.
|
Item 4. |
Mine Safety Disclosures.
|
Item 5. |
Other Information.
|
ADMA Biologics, Inc.
|
||||
Date: |
August 9, 2023
|
By:
|
/s/ Adam S. Grossman
|
|
Name:
|
Adam S. Grossman
|
|||
Title:
|
President and Chief Executive Officer
|
|||
Date: |
August 9, 2023
|
By:
|
/s/ Brian Lenz
|
|
Name:
|
Brian Lenz
|
|||
Title:
|
Executive Vice President and Chief Financial Officer
|
Exhibit Number
|
Description
|
Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Principal Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101*
|
The following materials from ADMA Biologics, Inc.’s Form 10-Q for the quarter ended June 30 2023, formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance
Sheets as of June 30, 2023 (Unaudited) and December 31, 2022, (ii) Condensed Consolidated Statements of Operations (Unaudited) for the three months and six months ended June 30, 2023 and 2022, (iii) Condensed Consolidated
Statements of Changes in Stockholders' Equity (Unaudited) for the three and six months ended June 30, 2023 and 2022, (iv) Condensed Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30, 2023 and 2022,
and (v) Notes to (Unaudited) Condensed Consolidated Financial Statements.
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
1. |
I have reviewed this Quarterly Report on Form 10-Q of ADMA Biologics, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth
fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 9, 2023
|
By:
|
/s/ Adam S. Grossman
|
Name:
|
Adam S. Grossman
|
|
Title:
|
President and Chief Executive Officer
(Principal Executive Officer)
|
1. |
I have reviewed this Quarterly Report on Form 10-Q of ADMA Biologics, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth
fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5. |
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: August 9, 2023
|
By:
|
/s/ Brian Lenz
|
Name:
|
Brian Lenz
|
|
Title:
|
Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)
|
1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2. |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August 9, 2023
|
By:
|
/s/ Adam S. Grossman
|
Name:
|
Adam S. Grossman
|
|
Title:
|
President and Chief Executive Officer
(Principal Executive Officer)
|
1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
2. |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: August 9, 2023
|
By:
|
/s/ Brian Lenz
|
Name:
|
Brian Lenz
|
|
Title:
|
Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)
|
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
STOCKHOLDERS' EQUITY | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 224,526,748 | 221,816,930 |
Common stock, shares outstanding (in shares) | 224,526,748 | 221,816,930 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||||
Revenues | $ 60,123,191 | $ 33,905,007 | $ 117,036,725 | $ 63,008,100 |
Cost of product revenue | 43,433,188 | 26,135,614 | 83,833,732 | 51,576,660 |
Gross profit | 16,690,003 | 7,769,393 | 33,202,993 | 11,431,440 |
OPERATING EXPENSES: | ||||
Research and development | 1,403,260 | 873,386 | 2,258,611 | 1,497,497 |
Plasma center operating expenses | 1,333,424 | 3,921,486 | 3,113,887 | 7,896,075 |
Amortization of intangible assets | 178,838 | 178,838 | 357,676 | 357,676 |
Selling, general and administrative | 14,247,558 | 11,970,422 | 28,759,214 | 25,669,997 |
Total operating expenses | 17,163,080 | 16,944,132 | 34,489,388 | 35,421,245 |
LOSS FROM OPERATIONS | (473,077) | (9,174,739) | (1,286,395) | (23,989,805) |
OTHER INCOME (EXPENSE): | ||||
Interest income | 414,304 | 2,269 | 581,275 | 35,337 |
Interest expense | (6,299,107) | (4,573,015) | (12,414,591) | (7,962,053) |
Loss on extinguishment of debt | 0 | 0 | 0 | (6,669,941) |
Other expense | (12,827) | (19,421) | (39,811) | (186,301) |
Other expense, net | (5,897,630) | (4,590,167) | (11,873,127) | (14,782,958) |
NET LOSS | $ (6,370,707) | $ (13,764,906) | $ (13,159,522) | $ (38,772,763) |
BASIC LOSS PER COMMON SHARE (in dollars per share) | $ (0.03) | $ (0.07) | $ (0.06) | $ (0.2) |
DILUTED LOSS PER COMMON SHARE (in dollars per share) | $ (0.03) | $ (0.07) | $ (0.06) | $ (0.2) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
Basic (in shares) | 222,683,393 | 196,353,185 | 222,304,676 | 196,113,888 |
Diluted (in shares) | 222,683,393 | 196,353,185 | 222,304,676 | 196,113,888 |
ORGANIZATION AND BUSINESS |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023 | |||
ORGANIZATION AND BUSINESS [Abstract] | |||
ORGANIZATION AND BUSINESS |
ADMA Biologics, Inc. (“ADMA” or the “Company”) is an end-to-end commercial biopharmaceutical
company dedicated to manufacturing, marketing and developing specialty plasma-derived biologics for the treatment of immunodeficient patients at risk for infection and others at risk for certain infectious diseases. The Company’s targeted
patient populations include immune-compromised individuals who suffer from an underlying immune deficiency disorder or who may be immune-suppressed for medical reasons.
ADMA operates through its wholly-owned subsidiaries ADMA BioManufacturing, LLC (“ADMA BioManufacturing”) and ADMA BioCenters
Georgia Inc. (“ADMA BioCenters”). ADMA BioManufacturing was formed in January 2017 to facilitate the acquisition of the Biotest Therapy Business Unit (“BTBU”) from BPC Plasma, Inc. (formerly Biotest Pharmaceuticals Corporation) (“BPC” and,
together with Biotest AG, “Biotest”) on June 6, 2017. The acquisition included certain assets of BTBU, including the U.S. Food and Drug Administration (“FDA”)-licensed BIVIGAM and Nabi-HB immunoglobulin products, and an FDA-licensed plasma
fractionation manufacturing facility located in Boca Raton, FL (the “Boca Facility”) (the “Biotest Transaction”). BTBU had previously been the Company’s third-party contract manufacturer. ADMA BioCenters is the Company’s source plasma
collection business with ten plasma collection facilities
located throughout the U.S., nine of which hold an approved license with the FDA.
The Company has three FDA-approved products, all of which are currently marketed and commercially available: (i) BIVIGAM (Immune Globulin Intravenous, Human), an Intravenous Immune Globulin (“IVIG”)
product indicated for the treatment of Primary Humoral Immunodeficiency (“PI”), also known as Primary Immunodeficiency Disease (“PIDD”) or Inborn Errors of Immunity, and for which the Company received FDA approval on May 9, 2019 and commenced
commercial sales in August 2019; (ii) ASCENIV (Immune Globulin Intravenous, Human – slra 10% Liquid), an IVIG product indicated for the treatment of PI, for which the Company received FDA approval on April 1, 2019 and commenced first
commercial sales in October 2019; and (iii) Nabi-HB (Hepatitis B Immune Globulin, Human), which is indicated for the treatment of acute exposure to blood containing Hepatitis B surface antigen (“HBsAg”) and other listed exposures to Hepatitis
B. In addition to its commercially available immunoglobulin products, the Company provides contract manufacturing and laboratory services for certain clients and generates revenues from the sale of intermediate by-products that result from
the immunoglobulin production process. The Company seeks to develop a pipeline of plasma-derived therapeutics, and its products and product candidates are intended to be used by physician specialists focused on caring for immune-compromised
patients with or at risk for certain infectious diseases.
As of June 30, 2023, the Company had working capital of $224.3 million, including $62.5 million of cash
and cash equivalents. Based upon the Company’s current projected revenue and expenditures, including capital expenditures and continued implementation of the Company’s commercialization and expansion activities, the Company’s management
currently believes that its cash, cash equivalents, projected revenue and accounts receivable will be sufficient to fund ADMA’s operations, as currently conducted, through the end of the third quarter of 2024, by which time the Company
believes it will have been generating positive cash flow from operations. These estimates may change based upon several factors, including the success of the Company’s commercial efforts with respect to the sale of its products, whether or
not the assumptions underlying the Company’s projected revenues and expenses are correct and the continued acceptability of ADMA’s immune globulin products by physicians, patients or payers. There can be no assurance that the Company’s
approved products will be commercially viable, or that plant capacity expansion or other capital improvements will be successfully completed or that any product developed in the future will be approved. The Company is subject to risks common
to companies in the biologics, biotechnology and pharmaceutical manufacturing industries including, but not limited to, dependence on collaborative arrangements, development by the Company or its competitors of new technological innovations,
dependence on key personnel, inflationary pressures, supply chain constraints, protection of proprietary technology and compliance with FDA and other governmental regulations and approval requirements.
ADMA
continues to evaluate a variety of strategic alternatives. While the exploration of value-creating opportunities remains a top corporate priority for the Company, ADMA has terminated its financial advisory agreement with Morgan Stanley.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America (“U.S. GAAP”) for interim financial information. Any reference in these notes to applicable guidance is meant to refer to U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”)
of the Financial Accounting Standards Board (the “FASB”).
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and notes thereto as of and
for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 23, 2023. The accompanying consolidated balance sheet as of December 31,
2022 was derived from the audited financial statements as of and for the year ended December 31, 2022. These condensed consolidated interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 8
of Regulation S-X, and therefore omit or condense certain footnotes and other information normally included in complete consolidated financial statements prepared in accordance with U.S. GAAP. All intercompany balances and transactions have
been eliminated in consolidation. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and
assumptions that impact the financial statements) considered necessary to present fairly the Company’s financial position as of June 30, 2023, its results of operations and changes in stockholders’ equity for the three and six months ended
June 30, 2023 and its cash flows for the six months ended June 30, 2023 and 2022.
During the three and six months ended June 30, 2023 and 2022, comprehensive loss was equal to the net loss
amounts presented for the respective periods in the accompanying condensed consolidated statements of operations. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full fiscal
year.
Use of Estimates
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include
rebates and chargebacks deducted from gross revenues, the realizable value of accounts receivable, valuation of inventory, assumptions used in projecting future liquidity and capital requirements, assumptions used in the fair value of awards
granted under the Company’s equity incentive plans and warrants issued in connection with the issuance of notes payable and the valuation allowance for the Company’s deferred tax assets.
Fair Value of Financial Instruments
The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable and accounts payable, are shown at
cost which approximates fair value due to the short-term nature of these instruments. The debt outstanding under the Company’s senior secured term loan (see Note 7) approximates fair value due to the variable interest rate on this debt.
Accounts Receivable
Accounts receivable is reported at realizable value, net of allowances for contractual credits and doubtful accounts in
the amount of $0.2 million and $0.1
million at June 30, 2023 and December 31, 2022, respectively, which
are recognized in the period the related revenue is recorded. The Company extends credit to its customers based upon an evaluation of each customer’s financial condition and credit history. Evaluations of
the financial condition, payment history and associated credit risk of customers are performed on an ongoing basis. Based on these evaluations, the Company has concluded that its credit risk is minimal. At June 30, 2023, three customers accounted for an aggregate of 94% of the Company’s total
accounts receivable, and at December 31, 2022, two customers accounted for approximately 92% of the Company’s total accounts receivable.
Inventories
Raw materials inventory consists of various materials purchased from suppliers, including
normal source plasma and Respiratory Syncytial Virus (“RSV”) plasma, used in the production of the Company’s products. Work-in-process and finished goods inventories (see Note 3) reflect the cost of raw materials as well as costs for direct
and indirect labor, primarily salaries, wages and benefits for applicable employees, as well as an allocation of overhead costs related to the Boca Facility including utilities, property taxes, general repairs and maintenance, consumable
supplies and depreciation. The allocation of Boca Facility overhead to inventory is generally based upon the estimated square footage of the Boca Facility that is used in the production of the Company’s products relative to the total square
footage of the facility.
Inventories, including plasma intended for resale and plasma intended for internal use in the
Company’s manufacturing, commercialization or research and development activities, are carried at the lower of cost or net realizable value determined by the first-in, first-out method. Net realizable value is generally determined based upon
the consideration the Company expects to receive when the inventory is sold, less costs to deliver the inventory to the recipient. The estimates for net realizable value of inventory are based on contractual terms or upon historical
experience and certain other assumptions, and the Company believes that such assumptions are reasonable. Inventory is periodically reviewed to ensure that its carrying value does not exceed its net realizable value, and adjustments are
recorded to write down such inventory, with a corresponding charge to cost of product revenue, when the carrying value or historical cost exceeds its estimated net realizable value. In addition, costs associated with the production of
conformance or engineering lots that would not qualify as immediately available for commercial sale are charged to cost of product revenue and not capitalized into inventory.
Goodwill
Goodwill represents the excess of purchase price over the fair value of net assets acquired by the Company. Goodwill at
June 30, 2023 and December 31, 2022 was $3.5 million. All of the Company’s goodwill is attributable to its ADMA BioManufacturing business segment and is related to the Biotest
Transaction.
Goodwill is not amortized but is assessed for impairment on an annual basis or more frequently if impairment indicators
exist. The Company has the option to perform a qualitative assessment of goodwill to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount, including goodwill and other
intangible assets. If the Company concludes that this is the case, then it must perform a goodwill impairment test by comparing the fair value of the reporting unit to its carrying value. An impairment charge is recorded to the extent the
reporting unit’s carrying value exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. The Company performs its annual goodwill impairment test as of October 1 of each year. The Company’s annual
goodwill impairment test as of October 1, 2022 did not result in a goodwill impairment charge, and the Company did not record any impairment charges related to goodwill for the three and six
months ended June 30, 2023 and 2022.
Impairment of Long-Lived Assets
The Company assesses the recoverability of its long-lived assets, which include property and equipment and finite-lived
intangible assets, whenever significant events or changes in circumstances indicate impairment may have occurred. If indicators of impairment exist, projected future undiscounted cash flows associated with the asset are compared to its
carrying amount to determine whether the asset’s carrying value is recoverable. Any resulting impairment is recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results. For the
three and six months ended June 30, 2023 and 2022, the Company
determined that there was no impairment of its long-lived assets.
Revenue Recognition
Revenues for the three and six months ended June 30, 2023
and 2022 are comprised of (i) revenues from the sale of the Company’s immunoglobulin products, BIVIGAM, ASCENIV and Nabi-HB, (ii) product revenues from the sale of human plasma collected through the
Company’s Plasma Collection Centers business segment, (iii) contract manufacturing and laboratory services revenue, (iv) revenues from the sale of intermediate by-products; and (v) license and other revenues primarily attributable to the
out-licensing of ASCENIV to Biotest in 2012 to market and sell this product in Europe and selected countries in North Africa and the Middle East. Biotest has provided the Company with certain services and financial payments in accordance
with the related Biotest license agreement and is obligated to pay the Company certain amounts in the future if certain milestones are achieved. Deferred revenue is amortized into income over the term of the Biotest license, representing a
period of approximately 22 years.
Product revenue is recognized when the customer is deemed to have control over the product. Control is determined based
on when the product is shipped or delivered and title passes to the customer. Revenue is recorded in an amount that reflects the consideration the Company expects to receive in exchange. Revenue from the sale of the Company’s immunoglobulin
products is recognized when the product reaches the customer’s destination, and is recorded net of estimated rebates, price protection arrangements and customer incentives, including prompt pay discounts, wholesaler chargebacks and other
wholesaler fees. These estimates are based on historical experience and certain other assumptions, and the Company believes that such estimates are reasonable. For revenues associated with contract manufacturing and the sale of intermediates,
control transfers to the customer and the performance obligation is satisfied when the customer takes possession of the product from the Boca Facility or from a third-party warehouse that is utilized by the Company.
Product revenues from the sale of human plasma collected at the Company’s plasma collection centers are recognized at
the time control of the product has been transferred to the customer, which generally occurs at the time of shipment. Product revenues are recognized at the time of delivery if the Company retains control of the product during shipment.
For the six months ended June 30, 2023, two customers represented an aggregate of 68% of the Company’s consolidated revenues. For the six months ended June 30, 2022, two customers represented an aggregate of
73% of the Company’s consolidated revenues.
Cost of Product Revenue
Cost of product revenue includes costs associated with the manufacture of the Company’s FDA approved products,
intermediates and the sale of human source plasma, as well as expenses related to conformance batch production, process development and scientific and technical operations when these operations are attributable to marketed products. When the
activities of these operations are attributable to new products in development, the expenses are classified as research and development expenses.
Loss Per Common Share
Basic loss per common share is computed by dividing net loss attributable to common stockholders by the
weighted average number of shares of common stock outstanding during the period. Diluted loss per common share is calculated by dividing net loss attributable to common stockholders, as adjusted for the effect of dilutive securities, if
any, by the weighted average number of shares of common stock and dilutive common stock outstanding during the period. Potentially dilutive common stock includes the shares of common stock issuable upon the exercise of outstanding stock
options and warrants, using the treasury stock method, as well as Restricted Stock Units (“RSUs”). Potentially dilutive common stock is excluded from the diluted loss per common share computation to the extent that it would be
anti-dilutive. As a result, no potentially dilutive securities are included in the computation of any of the accompanying diluted loss per share amounts in the accompanying condensed consolidated financial statements as the Company reported
a net loss for all periods presented. For the six months ended June 30, 2023 and 2022, the
following securities were excluded from the calculation of diluted loss per common share because of their anti-dilutive effects:
Stock-Based Compensation
The Company follows recognized accounting guidance which requires all equity-based payments, including grants of stock
options, to be recognized in the statement of operations as compensation expense based on their fair values at the date of grant. Compensation expense related to awards to employees and directors with service-based vesting conditions is
generally recognized on a straight-line basis over the associated vesting period of the award based on the grant date fair value of the award. Stock options granted under the Company’s equity incentive plans generally have a four-year vesting period and a term of 10
years. Pursuant to ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting (Topic 718), the Company has elected not to establish a forfeiture rate, as stock-based compensation expense
related to forfeitures of unvested stock options is fully reversed at the time of forfeiture.
Income Taxes
The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or its tax returns. Under this
method, deferred tax assets and liabilities are recognized for the temporary differences between the tax bases of assets and liabilities and their respective financial reporting amounts at enacted tax rates in effect for the years in which
the temporary differences are expected to reverse. The Company records a valuation allowance on its deferred tax assets if it is more likely than not that the Company will not generate sufficient taxable income to utilize its deferred tax
assets. The Company is subject to income tax examinations by major taxing authorities for all tax years since 2018 and for previous periods as it relates to the Company’s net operating loss carryforwards.
In accordance with U.S. GAAP, the Company is required to determine whether a tax position of the Company is more likely than not to be sustained upon examination by
the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that is
greater than 50% likely of being realized upon ultimate settlement. Derecognition of a tax benefit previously recognized could result in the Company recording a tax liability that would reduce net assets. Based on its analysis, the Company
has determined that it has not incurred any liability for unrecognized tax benefits as of June 30, 2023 and December 31,
2022, and during the six months ended June 30, 2023 and 2022 the Company recognized no
adjustments for uncertain tax positions.
|
INVENTORIES |
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES |
The following table provides the components of inventories:
Raw materials includes plasma and other materials expected to be used in the production of BIVIGAM, ASCENIV and Nabi-HB.
These materials will be consumed in the production of goods expected to be available for sale or otherwise have alternative uses that provide a probable future benefit.
Work-in-process inventory primarily consists of bulk drug substance and unlabeled filled vials of the Company’s
immunoglobulin products.
Finished goods inventory is comprised of immunoglobulin product inventory and related intermediates that are available
for commercial sale, as well as plasma collected at the Company’s plasma collection centers that is expected to be sold to third-party customers.
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INTANGIBLE ASSETS |
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INTANGIBLE ASSETS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INTANGIBLE ASSETS |
Intangible assets at June 30, 2023 and December 31, 2022 consist of the following:
All of the Company’s intangible assets were acquired in the
Biotest Transaction. Amortization expense related to these intangible assets was $0.2 million for the three months ended June 30,
2023 and 2022, and $0.4 million for the six months ended June 30, 2023 and 2022. Estimated future aggregate amortization expense is expected to be as follows:
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PROPERTY AND EQUIPMENT |
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT |
Property and equipment and related accumulated depreciation are summarized as
follows:
Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the
straight-line method over the asset’s estimated useful life. Land is not depreciated. The buildings were assigned a useful life of 30
years. Property and equipment other than land and buildings have useful lives ranging from
to 10 years. Leasehold improvements are amortized over the lesser of the lease term or their estimated useful lives.The Company recorded depreciation expense on property and equipment for the three
months ended June 30, 2023 and 2022 of $1.9 million and $1.5
million, respectively, and for the six months ended June 30, 2023 and 2022 of $3.8 million and $3.0 million, respectively.
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ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES |
Accrued expenses and other current liabilities at June 30, 2023 and December 31, 2022 are as follows:
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DEBT |
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DEBT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||
DEBT |
A summary of outstanding senior notes payable is as follows:
On March 23, 2022 (the “Hayfin Closing Date”), the Company and all of its subsidiaries entered into a Credit and Guaranty Agreement (the “Hayfin Credit Agreement”) with Hayfin
Services LLP (“Hayfin”). The Hayfin Credit Agreement provides for a senior secured term loan facility in a principal amount of up to $175.0
million (the “Hayfin Credit Facility”), composed of (i) a term loan made on the Hayfin Closing Date in the principal amount of $150.0
million (the “Hayfin Closing Date Loan”), and (ii) a delayed draw term loan in the principal amount of $25.0 million (the “Hayfin
Delayed Draw Loan” and, together with the Hayfin Closing Date Loan, the “Hayfin Loans”). The obligation of the lenders to make the Hayfin Delayed Draw Loan was to have expired on March 22, 2023 and is subject to the satisfaction of certain conditions, including, but not limited to, the Company’s meeting certain 12-month revenue targets as set
forth in the Hayfin Credit Agreement. The Hayfin Credit Facility has a maturity date of March 23, 2027 (the “Hayfin Maturity
Date”), subject to acceleration pursuant to the Hayfin Credit Agreement, including upon an Event of Default (as defined in the Hayfin Credit Agreement). On March 22, 2023, the Company and Hayfin entered into an amendment to the Hayfin Credit Agreement whereby the lenders’ obligation to
make the Hayfin Delayed Draw Loan was extended to June 30, 2023.
On the Hayfin Closing Date, the Company used $100.0 million of
the Hayfin Closing Date Loan to terminate and pay in full all of the outstanding obligations under the Company’s previously existing credit facility (the “Perceptive Credit Facility”) with Perceptive Credit Holdings II, LP (“Perceptive”).
The Company also used $2.0 million of the Hayfin Closing Date Loan proceeds to pay a redemption premium to Perceptive and used
approximately $1.0 million of the Hayfin Closing Date Loan proceeds to pay certain fees and expenses incurred in connection with
this transaction. In addition, a $1.8 million upfront fee payable to Hayfin was paid “in kind” and was added to the outstanding
principal balance in accordance with the terms of the Hayfin Credit Agreement. In connection with the retirement of the Perceptive Credit Facility and all of the obligations thereunder, the Company recorded a loss on extinguishment of debt
in the amount of $6.7 million, consisting of the write-off of unamortized discount related to the Perceptive indebtedness and the
redemption premium paid to Perceptive.
From the time of the Hayfin Closing Date through May 1, 2023, borrowings under the Hayfin Credit Agreement bore interest, at the Company’s election, at either (a) a base rate
(equal to the highest of (i) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States, (ii) the federal funds rate in effect on such day plus 0.50% and (iii) adjusted Term Secured Overnight Financing Rate (“SOFR”) for a one-month tenor in effect on such day plus 1.00%), plus an applicable margin of 8.5%, or (b) adjusted Term SOFR for either a one-month
or three-month tenor, as elected by the Company, and subject to a floor of 1.25%, plus an applicable margin of 9.5% (the
“Applicable Margin”); provided, however, that upon, and during the continuance of, an Event of Default, the Applicable Margin increases by an additional 3% per annum. On the last day of each calendar month or quarter during the term of the Hayfin Credit Facility, the Company pays accrued interest to Hayfin. The rate of interest in effect as of June 30,2023
and December 31, 2022 was 13.7% and 13.9%, respectively. The Company is also permitted to pay “in kind” a portion of the interest on the Hayfin Loans for each monthly or quarterly interest period in an amount equal to
2.5% per annum, which is added to the principal amount of the outstanding debt under the Hayfin Credit Facility. For the six months ending June
30,2023, approximately $2.0 million of interest was paid in kind and added to the balance of the outstanding Hayfin Loans.
On the Hayfin Maturity Date, the Company will pay Hayfin the entire outstanding principal amount underlying the Hayfin Loans and any accrued and unpaid interest thereon, as
well as an exit fee of 1.0% of the outstanding principal amount being paid. This exit fee is recorded separately as a
non-current liability on the accompanying consolidated balance sheets as of June 30,2023 and December 31,2022. Prior to the Hayfin Maturity Date, there are no scheduled principal payments on the Hayfin Loans.
All of the Company’s obligations under the Hayfin Credit Agreement are secured by a first-priority lien and security interest in substantially all of the Company’s tangible
and intangible assets, including intellectual property and all of the equity interests in the Company’s subsidiaries. The Hayfin Credit Agreement contains certain representations and warranties, affirmative covenants, negative covenants and
conditions that are customarily required for similar financings. The negative covenants restrict or limit the ability of the Company and its subsidiaries to, among other things and subject to certain exceptions contained in the Hayfin
Credit Agreement, incur new indebtedness; create liens on assets; engage in certain fundamental corporate changes, such as mergers or acquisitions, or changes to the Company’s or its subsidiaries’ business activities; make certain
Investments or Restricted Payments (each as defined in the Hayfin Credit Agreement); change its fiscal year; pay dividends; repay certain other indebtedness; engage in certain affiliate transactions; or enter into, amend or terminate any other agreements that
have the impact of restricting the Company’s ability to make loan repayments under the Hayfin Credit Agreement. In addition, the Company is required (i) at all times prior to the Maturity Date to maintain a minimum cash balance of $6.0 million; and (ii) as of the last day of each fiscal quarter, report IVIG product and related revenues for the trailing 12-month period that
exceed the amounts set forth in the Hayfin Credit Agreement, which range from $75.0 million for the fiscal quarter ended June
30, 2022 to $250.0 million for the fiscal quarter ended December 31, 2026. As of June 30, 2023, the Company was in compliance
with all of the covenants contained in the Hayfin Credit Agreement.
As consideration for the Hayfin Credit Agreement, the Company issued to various entities affiliated with Hayfin, on the Hayfin Closing Date, warrants to purchase an aggregate
of 9,103,047 shares of the Company’s common stock (the “Hayfin Warrants”). The Hayfin Warrants have an exercise price equal to $1.6478 per share, which is equal to the trailing 30-day
Volume Weighted-average Price of the Company’s common stock on the business day immediately prior to the Hayfin Closing Date. The Hayfin Warrants were valued by the Company at approximately $9.6 million as of the Hayfin Closing Date and have an expiration date of March 23, 2029.
On May
1, 2023, the Company entered into a second amendment to the Hayfin Credit Agreement (the “Hayfin Second Amendment”) whereby the Applicable Margin for adjusted Term SOFR Loans was reduced from 9.5% to 8.5%. The Hayfin Second Amendment also
extended the obligation of the lenders to make the Hayfin Delayed Draw Loan from June 30, 2023 to December 31, 2023.
Under
the terms of the Hayfin Second Amendment, in the event the Company elects to prepay all or any portion of the outstanding principal on the Hayfin Loans, the Company will be subject to an early prepayment fee in the amount equal to (i) 7.0% of the prepaid principal amount, if prepaid on or prior to the first anniversary of the Hayfin Second Amendment, (ii) 3.0% of the prepaid principal amount, if prepaid after the first anniversary of the Hayfin Second Amendment and on or prior to the second
anniversary of the Hayfin Second Amendment, or (iii) 1.0% of the prepaid principal amount, if prepaid after the second
anniversary of the Hayfin Second Amendment and on or prior to the third anniversary of the Hayfin Second Amendment. For any prepayments of principal or payment of principal on the Hayfin Maturity Date, the Company is also required to
pay the exit fee. In addition, the Hayfin Second Amendment provides for a 50% reduction to the foregoing early prepayment
fees if the Hayfin Loans are prepaid in connection with a change in control of the Company or other strategic transactions as further described in the Hayfin Second Amendment.
In connection with the Hayfin Second Amendment, the Company issued additional warrants to the lenders to purchase 2,391,244
shares of the Company’s common stock at an exercise price of $3.2619 per share (the “Hayfin Second Amendment Warrants”). The Hayfin
Second Amendment Warrants were valued at approximately $5.6 million and have an expiration date of May 1, 2030.
As a result of the upfront fee and exit fee paid or payable to Hayfin, the expenses incurred by the Company in connection with this transaction and the value of the Hayfin
Warrants and Hayfin Second Amendment Warrants, the Company recognized an aggregate discount on the Hayfin Loans in the amount of $19.5
million. The Company records debt discount as a reduction to the face amount of the debt, and the debt discount is amortized as interest expense over the life of the debt using the interest method. Based on the fair value of the Hayfin
Warrants and the aggregate amount of fees and expenses associated with obtaining the Hayfin Credit Facility, the effective interest rate on the Hayfin Loans as of June 30,2023 and December 31, 2022 was approximately 17.4% and 16.1%, respectively.
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STOCKHOLDERS' EQUITY |
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STOCKHOLDERS' EQUITY [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY |
Preferred Stock
The Company is currently authorized to issue up to 10 million shares of preferred stock, $0.0001, par value per share.
There were no shares of preferred stock outstanding at June 30, 2023 and December 31, 2022.
Common Stock
As of June 30, 2023 and December 31, 2022, the Company was authorized to issue 300,000,000 shares of its common stock, $0.0001 par
value per share, and 224,526,748 and 221,816,930
shares of common stock were outstanding as of June 30, 2023 and December 31, 2022, respectively. After giving effect to the 46,940,501
shares reserved for outstanding warrants and awards issued or reserved for future issuance under the Company’s equity incentive plans, as of June 30, 2023 there were 28,532,751 shares of common stock available for issuance.
Warrants
In connection with the Hayfin Credit Agreement that the Company entered into on March 23, 2022 (see Note 7), the Company
issued the Hayfin Warrants to purchase 9,103,047 shares of the Company’s common stock. The Hayfin Warrants were valued at $9.6 million using the Black-Scholes option-pricing model assuming an expected term of seven years, a volatility of 68.1%, a dividend yield of 0% and a risk-free rate of interest of 2.36%.
On May 1, 2023 the Company issued the Hayfin Second Amendment Warrants, which were valued at $5.6
million using the Black-Scholes option-pricing model assuming an expected term of seven years, a volatility of 67.8%, a dividend yield of 0%
and a risk-free rate of interest of 3.62%.
On May 13, 2023, warrants to purchase 24,800 shares of
the Company’s common stock held by a former noteholder of the Company expired in accordance with their terms. On June 16, 2023, various entities affiliated with Hayfin exercised 3,388,686 Hayfin Warrants in a cashless exercise transaction resulting in the Company issuing 1,967,847 shares of its common stock to such entities. At June 30, 2023 and December 31, 2022, the Company had outstanding warrants to purchase an aggregate of 12,502,906 and 13,525,148 shares,
respectively, of common stock, with weighted-average exercise prices of $2.32 and $1.99 per share, respectively, with expiration dates ranging between December 2024 and December 2030.
Equity Incentive Plans
The fair value of stock options granted under the Company’s equity incentive plans was determined on the date of grant using the Black-Scholes option valuation model. The Black-Scholes model was
developed for use in estimating the fair value of publicly traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of certain subjective assumptions including the
expected stock price volatility. The stock options granted to employees and directors have characteristics significantly different from those of traded options, and changes in the subjective input assumptions can materially affect the fair
value estimate. The following assumptions were used to determine the fair value of options granted during the six months ended June 30, 2023 and 2022:
On June 21, 2022, the Company’s stockholders approved the ADMA Biologics, Inc. 2022 Compensation Plan (the “2022 Equity
Plan”), which replaced the ADMA Biologics, Inc. 2014 Omnibus Incentive Compensation Plan. Approval of the 2022 Equity Plan resulted in approximately 18 million additional shares of the Company’s common stock being reserved for future awards. During the six months ended June 30, 2023 and 2022, the
Company granted options to purchase an aggregate of 1,727,510 and 1,194,032 shares of common stock, respectively, to its directors and employees. The weighted average remaining contractual life of stock options outstanding and expected to vest at June
30, 2023 is 6.2 years. The weighted average remaining contractual life of stock options exercisable at June 30, 2023 is 5.0 years. During the six months ended June 30, 2023, options to purchase 178,829 shares of common stock were exercised and the Company received aggregate exercise proceeds of $0.5 million. Also during the six months ended June 30, 2023, options to purchase 5,416
shares of common stock were exercised in a cashless transaction resulting in the issuance of 2,443 shares of common stock.
A summary of the Company’s option activity under the Company’s equity incentive plans and related information is as
follows:
As of June 30, 2023, the Company had $4.9 million of unrecognized compensation expense related to options granted under the Company’s equity incentive plans, which is expected to be recognized over a weighted-average period
of 2.9 years.
During the six months ended June 30, 2023 and 2022, the Company granted RSUs representing an aggregate of 2,976,260 and 1,109,266 shares,
respectively, to certain employees of the Company and to members of its Board of Directors. These RSUs generally vest annually over a period of four years for employees and semi-annually over a period of one year for directors. During the six months ended
June 30, 2023, an aggregate of 806,781 shares of common stock vested in connection with grants of RSUs. With respect to these
vested RSUs, 246,082 shares valued at approximately $0.9 million were withheld by the Company to cover employees’ tax liabilities. These shares were no longer outstanding as of June 30, 2023. A summary of the
Company’s unvested RSU activity and related information is as follows:
As of June 30, 2023, the Company had $11.6 million of unrecognized compensation expense related to unvested RSUs granted under the Company’s equity incentive plans, which is expected to be recognized over a weighted-average
period of 3.2 years.
Total stock-based compensation expense for all awards granted under the Company’s equity incentive plans for the three
and six months ended June 30, 2023 and 2022 is as follows:
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RELATED PARTY TRANSACTIONS |
6 Months Ended | ||
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Jun. 30, 2023 | |||
RELATED PARTY TRANSACTIONS [Abstract] | |||
RELATED PARTY TRANSACTIONS |
The Company leases an office building and equipment from Areth, LLC (“Areth”)
pursuant to an agreement for services
effective as of January 1, 2016, as amended from time to time, and pays monthly rent on this facility in the amount of $10,000 through December 31, 2026. Rent expense for the three and six months ended June 30, 2023 and 2022 amounted to $30,000 and $60,000, respectively. Areth is a
company controlled by Dr. Jerrold B. Grossman, the Vice Chairman of the Company’s Board of Directors, and Adam S. Grossman, the Company’s President and Chief Executive Officer. The Company also reimburses Areth for office and building-related
(common area) expenses, equipment and certain other operational expenses, which were not material to the condensed consolidated financial statements for the six months ended June 30, 2023 and 2022.
During the six months ended June 30, 2023 and 2022, the Company purchased certain specialized medical equipment and
services primarily related to the Company’s plasma collection centers, as well as personal protective equipment, from GenesisBPS and its affiliates (“Genesis”), aggregating to $0.2 million and $0.1 million, respectively. Genesis is owned by Dr. Grossman
and Adam Grossman.
See Note 7 for a discussion of the Company’s former credit facility and related
transactions with Perceptive, a holder of more than 5% of the Company’s common stock during the six months ended June 30, 2022. There were no transactions with Perceptive
during the six months ended June 30, 2023.
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COMMITMENTS AND CONTINGENCIES |
6 Months Ended | ||
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Jun. 30, 2023 | |||
COMMITMENTS AND CONTINGENCIES [Abstract] | |||
COMMITMENTS AND CONTINGENCIES |
General Legal Matters
From time to time, the Company is or may become subject to certain legal proceedings and claims arising in connection
with the normal course of its business. Management does not expect that the outcome of any such claims or actions will have a material effect on the Company’s liquidity, results of operations or financial condition.
IT Systems Disruption
On June 19, 2023, the Company experienced an IT systems disruption, which rendered certain of the Company’s IT
technology systems inaccessible for less than
week. The Company’s investigation of the disruption remains ongoing with the
assistance of third-party consultants. As no definitive root cause has been identified, the Company believes, theoretically, this IT systems disruption may have been caused by a third-party who may have gained access to the system. There was
no original financial systems or other data loss or any evidence of files exfiltrated due to this disruption. Normal course operations have resumed across the Company’s business units. At the time of the disruption, the Company was in
production of two batches of BIVIGAM, and after a prolonged hold time, it was deemed to be a prudent GMP quality decision to
discard these two in-process production batches as these batches were no longer viable for further production or had any
alternative use. As a result, the Company recorded a one-time, non-recurring charge of $2.1 million for this inventory, which is
reflected in Cost of product revenue in the accompanying consolidated statements of operations. In addition, the Company believes that its Plasma center operating expenses were adversely impacted by approximately $0.7 million due to the temporary closing of the Company’s plasma collection centers while their IT systems were restored.
The Company carries appropriate insurance for these types of instances, and while there can be no assurances
ADMA will be reimbursed for the insurance claims made pertaining to these charges, the Company is actively working with its insurance broker and carriers.
COVID-19 Pandemic
The Company continues to monitor the ongoing developments related to the COVID-19 pandemic, including the emergence of
the Delta, Omicron and BA.2 variants and other resistant strains of the coronavirus, and its impacts to the Company’s commercial and manufacturing operations and plasma collection facilities, including collections of source plasma, procurement
of raw materials and packaging materials, a portion of which are sourced internationally, and the testing of finished drug product that is required prior to its availability for commercial sale. A substantial portion of such testing has
historically been performed by contract laboratories outside the United States.
Due to a combination of previously mandated state and local “shelter-in-place” orders, as well as government stimulus
packages, persisting social distancing measures and varying roll-outs of vaccinations by state, the Company at times experienced lower than normal donor collections at its FDA approved plasma collection centers during 2021 and part of 2022. From time to time during 2021 and 2022, the Company was also subject to delays in shipments of source plasma from its contracted third-party suppliers, as well as
delays in deliveries for personal protective equipment, reagents and other non-plasma raw materials and supplies used in the manufacture and distribution of its products. In addition, the Company has been subject to supply chain delays as a
result of certain of its suppliers diverting significant resources towards the rapid development and distribution of COVID-19 vaccines and, as a result, the Company has elected to carry more raw materials inventory than it has in the past. The
COVID-19 pandemic previously impacted, to a certain degree, the Company’s customer engagement initiatives, whereby ADMA’s sales and medical affairs field personnel faced difficulties communicating directly with physicians and other healthcare
professionals, as well as the cancellation or postponement of a number of key scientific and medical meetings, further limiting the Company’s ability to communicate with potential customers.
The pandemic could also impact the Company’s ability to interact with the FDA or other regulatory authorities and could result in delays in the conduct of inspections
or review of pending applications or submissions. Although the Company has received FDA approvals for six of its plasma collection centers since January 1, 2022 and received several other FDA approvals while two FDA inspections of the Boca Facility were completed during the year ended December 31, 2021, no assurances can be provided as to the timing for completion of any future regulatory
submissions or applications that may be impacted by restrictions related to COVID-19.
During the six months ended June 30, 2023 and 2022, revenue attributable to international customers was
approximately 7% of the Company’s total revenues. As the Company seeks to grow this aspect of its business, it may also be
subject to the impacts of the COVID-19 pandemic in locations outside the United States.
Notwithstanding the foregoing, the COVID-19 pandemic to date has not had a material impact on the Company’s financial
condition or results of operations, and the Company does not believe that its production operations at the Boca Facility, the Company’s contract fill/finishers or its plasma collection facilities have been significantly impacted by the
COVID-19 pandemic. As a result, the Company does not anticipate and has not experienced any material impairments with respect to any of its long-lived assets, including the Company’s property and equipment, goodwill or intangible assets.
Although the COVID-19 pandemic has not, to date, materially adversely impacted the Company’s capital and financial
resources, because the Company is unable to determine the ultimate severity or duration of the COVID-19 pandemic or other pandemics or their long-term effects on, among other things, the global, national or local economies, the capital and
credit markets or the Company’s workforce, customers or our suppliers, at this time the Company is unable to predict whether COVID-19 or other pandemics will have a material adverse impact on the Company’s business, financial condition,
liquidity or results of operations.
Vendor Commitments
Pursuant to the terms of a plasma purchase agreement with BPC dated as of November 17, 2011 (the “2011 Plasma Purchase
Agreement”), the Company agreed to purchase from BPC an annual minimum volume of source plasma containing antibodies to RSV to be used in the manufacture of ASCENIV. The Company must purchase a to-be-determined and agreed upon annual minimum
volume from BPC, but may also collect high-titer RSV plasma from up to five wholly-owned ADMA plasma collection facilities. During
2015, the Company and BPC amended the 2011 Plasma Purchase Agreement to allow the Company the ability to collect its raw material RSV high-titer plasma from other third-party collection organizations, thus allowing the Company to expand its
reach for raw material supply as it executes its commercialization plans for ASCENIV. As part of the closing of the Biotest Transaction, the parties amended the 2011 Plasma Purchase Agreement to extend the initial term through the ten-year anniversary of the closing date of the Biotest Transaction. Unless terminated earlier, the 2011 Plasma Purchase Agreement expires in June
2027, after which it may be renewed for two additional five-year periods if agreed to by the parties. On December 10, 2018, BPC assigned its rights and obligations under the 2011 Plasma Purchase Agreement to Grifols Worldwide
Operations Limited (“Grifols”) as its successor-in-interest, effective January 1, 2019. On January 1, 2019, Grifols and the Company entered into an additional amendment to the 2011 Plasma Purchase Agreement for the purchase of source plasma
containing antibodies to RSV from Grifols. Pursuant to this amendment, until January 1, 2022, the Company could purchase RSV plasma from Grifols from the two plasma collection centers that were transferred to BPC on January 1, 2019 at a price equal to cost plus five percent (5%) (without any additional increase due to inflation). Effective January 1, 2022, RSV plasma purchased
from these two plasma collection centers are subject to the pricing terms in effect for RSV plasma purchased from other plasma
collection centers owned by Grifols.
On June 6, 2017, the Company and BPC entered into a Plasma Supply Agreement pursuant to which BPC supplies, on an
exclusive basis subject to certain exceptions, to ADMA BioManufacturing an annual minimum volume of hyperimmune plasma that contain antibodies to the Hepatitis B virus for the manufacture of Nabi-HB. The Plasma Supply Agreement has a 10-year term. On July 19, 2018, the Company and BPC entered into an amendment to the Plasma Supply Agreement to provide, among other things, that in
the event BPC elects not to supply in excess of ADMA BioManufacturing’s specified amount of Hepatitis B plasma and ADMA BioManufacturing is unable to secure Hepatitis B plasma from a third party at a price that is within a low double- digit
percentage of the price that ADMA BioManufacturing pays to BPC, then BPC shall reimburse ADMA BioManufacturing for the difference in price ADMA BioManufacturing incurs. On December 10, 2018, BPC assigned its rights and obligations under the
Plasma Supply Agreement to Grifols, effective January 1, 2019.
On June 6, 2017, the Company and BPC entered into a Plasma Purchase Agreement (the “2017 Plasma Purchase Agreement”),
pursuant to which ADMA BioManufacturing purchases normal source plasma (“NSP”) from BPC at agreed upon annual quantities and prices. The 2017 Plasma Purchase Agreement has an initial term of five years after which the 2017 Plasma Purchase Agreement may be renewed for additional two terms of two years each upon the mutual written consent of the
parties. On July 19, 2018, the Company and BPC entered into an amendment to the 2017 Plasma Purchase Agreement to, among other things, provide agreed upon amounts of normal source plasma to be supplied by BPC to ADMA
BioManufacturing in calendar year 2019 at a specified price per liter, provided that ADMA BioManufacturing delivers a valid purchase order to BPC. Additionally, pursuant to the amendment to the 2017 Plasma Purchase Agreement, BPC agreed that,
for calendar years 2020 and 2021, it shall supply no less than a high double-digit percentage of ADMA BioManufacturing’s requested NSP amounts, provided that such requested NSP amounts are within an agreed range, at a price per liter to be
mutually determined. Furthermore, pursuant to the amendment to the 2017 Plasma Purchase Agreement, in the event BPC fails to supply ADMA BioManufacturing with at least a high double-digit percentage of ADMA BioManufacturing’s requested NSP
amounts, BPC shall promptly reimburse ADMA BioManufacturing the difference in price ADMA BioManufacturing incurs due to BPC’s election not to supply NSP to ADMA BioManufacturing in such amounts as requested. On December 10, 2018, BPC assigned
its rights and obligations under the Plasma Purchase Agreement to Grifols, effective January 1, 2019.
Effective as of May 12, 2021, the Company and Grifols amended the foregoing 2017 Plasma Purchase Agreement whereby, among other things, the term of the agreement was
extended through December 31, 2022, however Grifols’ commitment
to supply the Company with NSP under this agreement was not satisfied until March of 2023. In order to maintain a reliable supply of raw material plasma thereafter, the Company has executed additional agreements with multiple
third-party suppliers of NSP to supplement the 2017 Plasma Purchase Agreement. The Company has also increased its number of planned plasma collection center buildouts such that the Company expects to have ten FDA-approved plasma collection centers in operation by the end of 2023, while also continuing to increase its plasma collection capabilities
at its ADMA BioCenters plasma collection centers business segment.
Through December 31, 2022, the
Company purchased substantially all of its raw material plasma from Grifols. For the six months ended June 30, 2023, plasma purchases from Grifols totaled $5.2 million, or approximately 26% of the Company’s total inventory purchases. For the six months
ended June 30, 2022, plasma purchases from Grifols totaled $22.8 million, representing approximately 66% of the Company’s total inventory purchases.
Post-Marketing Commitments
In connection with the approval of the BLA for BIVIGAM, on December 19, 2012, Biotest committed to perform two
additional post-marketing studies, a pediatric study to evaluate the efficacy and safety of BIVIGAM in children and adolescents, and a post-authorization safety study to further assess the potential risk of hypotension and hepatic and renal
impairment in BIVIGAM-treated patients with primary humoral immunodeficiency. These studies were required to be completed by June of 2023 and both studies have been completed and the study reports have been submitted to the FDA. ADMA had
assumed the remaining obligations, and the costs of the studies have been expensed as incurred as research and development expenses. For the six months ended June 30, 2023 and 2022, the Company incurred expenses related to these studies of $1.4 million and $0.9 million,
respectively.
In connection with the FDA’s approval of ASCENIV on April 1, 2019, the Company is required to perform a
pediatric study to evaluate the safety and efficacy of ASCENIV in children and adolescents. For the six months ended June 30, 2023 and 2022, the Company incurred expenses related to this study in the amount of $0.4 million and $0.2 million,
respectively. The Company expects to incur expenses of approximately $1.5 million to complete this study, which is required to be
completed by June of 2026.
Employment Contracts
The Company has entered into employment agreements with Mr. Grossman and with Brian Lenz, its Executive Vice President,
Chief Financial Officer and General Manager, ADMA BioCenters.
Other Commitments
In the normal course of business, the Company enters into contracts that contain a variety of indemnifications with its
employees, licensors, suppliers and service providers. Further, the Company indemnifies its directors and officers who are, or were, serving at the Company’s request in such capacities. The Company’s maximum exposure under these arrangements is
unknown as of June 30, 2023. The Company does not anticipate recognizing any significant losses relating to these arrangements.
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SEGMENTS |
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SEGMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENTS |
The Company is engaged in the manufacture, marketing and development of specialty plasma-derived
biologics. The Company’s ADMA BioManufacturing segment reflects the Company’s immunoglobulin manufacturing, commercial and development operations in Boca Raton, FL. The Plasma Collection Centers segment consists of ten operational plasma collection facilities located throughout the U.S., nine of which currently hold FDA licenses. The Corporate segment includes general and administrative overhead expenses. The Company defines its segments as those
business units whose operating results are regularly reviewed by the chief operating decision maker (“CODM”) to analyze performance and allocate resources. The Company’s CODM is its President and Chief Executive Officer. Summarized financial information concerning reportable segments is shown in the following tables:
Net revenues according to geographic area, based on the location of where the product is shipped, is as follows:
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LEASE OBLIGATIONS |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASE OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASE OBLIGATIONS |
The Company leases certain properties and equipment for its ADMA BioCenters and ADMA BioManufacturing subsidiaries, which
leases provide the right to use the underlying assets and require lease payments through the respective lease terms which expire at various dates through 2033. The Company’s lease agreements do not contain any material residual value guarantees
or material restrictive covenants.
The Company determines if an arrangement is an operating lease at inception. Leases with an initial term of 12 months or
less are not recorded on the balance sheet. All other leases are recorded on the balance sheet with assets representing the right to use the underlying asset for the lease term and lease liabilities representing the obligation to make lease
payments arising from the lease. For all of its leases, the Company has elected and applies the practical expedient available to lessees to combine non-lease components with their related
lease components and account for them as a single combined lease component. Right-to-use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term and include
options to extend or terminate the lease when they are reasonably certain to be exercised. The present value of the lease payments is determined using the Company’s incremental borrowing rate. The Company’s lease expense is recognized on a
straight-line basis over the lease term and is reflected in Plasma center operating expenses and Selling, general and administrative expenses. Aggregate lease expense for the Company’s leases for the three months ended June 30, 2023 and 2022 was approximately $0.6 million and $0.5 million, respectively, and aggregate
lease expense for the six months ended June 30, 2023 and 2022 was $1.2 million and $0.9 million, respectively. Cash paid for the Company’s leases for the three months ended June 30, 2023 and 2022 was approximately $0.6 million and $0.4 million,
respectively, and cash paid for the six months ended June 30, 2023 and 2022 was approximately $1.1 million and $0.8 million, respectively.
The Company has aggregate lease liabilities of $11.2 million and $11.6 million as of June 30, 2023 and December 31, 2022,
respectively, which are comprised primarily of the leases for the Company’s plasma collection centers and a warehouse lease for raw material storage related to the Company’s immunoglobulin manufacturing operations. The Company’s operating
leases have a weighted average remaining term of 8.1 years. Scheduled payments under the Company’s lease obligations are as follows:
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |
Supplemental cash flow information for the six months ended June 30, 2023 and 2022 is as follows:
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation |
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America (“U.S. GAAP”) for interim financial information. Any reference in these notes to applicable guidance is meant to refer to U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”)
of the Financial Accounting Standards Board (the “FASB”).
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and notes thereto as of and
for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 23, 2023. The accompanying consolidated balance sheet as of December 31,
2022 was derived from the audited financial statements as of and for the year ended December 31, 2022. These condensed consolidated interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 8
of Regulation S-X, and therefore omit or condense certain footnotes and other information normally included in complete consolidated financial statements prepared in accordance with U.S. GAAP. All intercompany balances and transactions have
been eliminated in consolidation. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and
assumptions that impact the financial statements) considered necessary to present fairly the Company’s financial position as of June 30, 2023, its results of operations and changes in stockholders’ equity for the three and six months ended
June 30, 2023 and its cash flows for the six months ended June 30, 2023 and 2022.
During the three and six months ended June 30, 2023 and 2022, comprehensive loss was equal to the net loss
amounts presented for the respective periods in the accompanying condensed consolidated statements of operations. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full fiscal
year.
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Use of Estimates |
Use of Estimates
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include
rebates and chargebacks deducted from gross revenues, the realizable value of accounts receivable, valuation of inventory, assumptions used in projecting future liquidity and capital requirements, assumptions used in the fair value of awards
granted under the Company’s equity incentive plans and warrants issued in connection with the issuance of notes payable and the valuation allowance for the Company’s deferred tax assets.
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Fair Value of Financial Instruments |
Fair Value of Financial Instruments
The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable and accounts payable, are shown at
cost which approximates fair value due to the short-term nature of these instruments. The debt outstanding under the Company’s senior secured term loan (see Note 7) approximates fair value due to the variable interest rate on this debt.
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Accounts Receivable |
Accounts Receivable
Accounts receivable is reported at realizable value, net of allowances for contractual credits and doubtful accounts in
the amount of $0.2 million and $0.1
million at June 30, 2023 and December 31, 2022, respectively, which
are recognized in the period the related revenue is recorded. The Company extends credit to its customers based upon an evaluation of each customer’s financial condition and credit history. Evaluations of
the financial condition, payment history and associated credit risk of customers are performed on an ongoing basis. Based on these evaluations, the Company has concluded that its credit risk is minimal. At June 30, 2023, three customers accounted for an aggregate of 94% of the Company’s total
accounts receivable, and at December 31, 2022, two customers accounted for approximately 92% of the Company’s total accounts receivable.
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Inventories |
Inventories
Raw materials inventory consists of various materials purchased from suppliers, including
normal source plasma and Respiratory Syncytial Virus (“RSV”) plasma, used in the production of the Company’s products. Work-in-process and finished goods inventories (see Note 3) reflect the cost of raw materials as well as costs for direct
and indirect labor, primarily salaries, wages and benefits for applicable employees, as well as an allocation of overhead costs related to the Boca Facility including utilities, property taxes, general repairs and maintenance, consumable
supplies and depreciation. The allocation of Boca Facility overhead to inventory is generally based upon the estimated square footage of the Boca Facility that is used in the production of the Company’s products relative to the total square
footage of the facility.
Inventories, including plasma intended for resale and plasma intended for internal use in the
Company’s manufacturing, commercialization or research and development activities, are carried at the lower of cost or net realizable value determined by the first-in, first-out method. Net realizable value is generally determined based upon
the consideration the Company expects to receive when the inventory is sold, less costs to deliver the inventory to the recipient. The estimates for net realizable value of inventory are based on contractual terms or upon historical
experience and certain other assumptions, and the Company believes that such assumptions are reasonable. Inventory is periodically reviewed to ensure that its carrying value does not exceed its net realizable value, and adjustments are
recorded to write down such inventory, with a corresponding charge to cost of product revenue, when the carrying value or historical cost exceeds its estimated net realizable value. In addition, costs associated with the production of
conformance or engineering lots that would not qualify as immediately available for commercial sale are charged to cost of product revenue and not capitalized into inventory.
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Goodwill |
Goodwill
Goodwill represents the excess of purchase price over the fair value of net assets acquired by the Company. Goodwill at
June 30, 2023 and December 31, 2022 was $3.5 million. All of the Company’s goodwill is attributable to its ADMA BioManufacturing business segment and is related to the Biotest
Transaction.
Goodwill is not amortized but is assessed for impairment on an annual basis or more frequently if impairment indicators
exist. The Company has the option to perform a qualitative assessment of goodwill to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount, including goodwill and other
intangible assets. If the Company concludes that this is the case, then it must perform a goodwill impairment test by comparing the fair value of the reporting unit to its carrying value. An impairment charge is recorded to the extent the
reporting unit’s carrying value exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. The Company performs its annual goodwill impairment test as of October 1 of each year. The Company’s annual
goodwill impairment test as of October 1, 2022 did not result in a goodwill impairment charge, and the Company did not record any impairment charges related to goodwill for the three and six
months ended June 30, 2023 and 2022.
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Impairment of Long-Lived Assets |
Impairment of Long-Lived Assets
The Company assesses the recoverability of its long-lived assets, which include property and equipment and finite-lived
intangible assets, whenever significant events or changes in circumstances indicate impairment may have occurred. If indicators of impairment exist, projected future undiscounted cash flows associated with the asset are compared to its
carrying amount to determine whether the asset’s carrying value is recoverable. Any resulting impairment is recorded as a reduction in the carrying value of the related asset in excess of fair value and a charge to operating results. For the
three and six months ended June 30, 2023 and 2022, the Company
determined that there was no impairment of its long-lived assets.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition |
Revenue Recognition
Revenues for the three and six months ended June 30, 2023
and 2022 are comprised of (i) revenues from the sale of the Company’s immunoglobulin products, BIVIGAM, ASCENIV and Nabi-HB, (ii) product revenues from the sale of human plasma collected through the
Company’s Plasma Collection Centers business segment, (iii) contract manufacturing and laboratory services revenue, (iv) revenues from the sale of intermediate by-products; and (v) license and other revenues primarily attributable to the
out-licensing of ASCENIV to Biotest in 2012 to market and sell this product in Europe and selected countries in North Africa and the Middle East. Biotest has provided the Company with certain services and financial payments in accordance
with the related Biotest license agreement and is obligated to pay the Company certain amounts in the future if certain milestones are achieved. Deferred revenue is amortized into income over the term of the Biotest license, representing a
period of approximately 22 years.
Product revenue is recognized when the customer is deemed to have control over the product. Control is determined based
on when the product is shipped or delivered and title passes to the customer. Revenue is recorded in an amount that reflects the consideration the Company expects to receive in exchange. Revenue from the sale of the Company’s immunoglobulin
products is recognized when the product reaches the customer’s destination, and is recorded net of estimated rebates, price protection arrangements and customer incentives, including prompt pay discounts, wholesaler chargebacks and other
wholesaler fees. These estimates are based on historical experience and certain other assumptions, and the Company believes that such estimates are reasonable. For revenues associated with contract manufacturing and the sale of intermediates,
control transfers to the customer and the performance obligation is satisfied when the customer takes possession of the product from the Boca Facility or from a third-party warehouse that is utilized by the Company.
Product revenues from the sale of human plasma collected at the Company’s plasma collection centers are recognized at
the time control of the product has been transferred to the customer, which generally occurs at the time of shipment. Product revenues are recognized at the time of delivery if the Company retains control of the product during shipment.
For the six months ended June 30, 2023, two customers represented an aggregate of 68% of the Company’s consolidated revenues. For the six months ended June 30, 2022, two customers represented an aggregate of
73% of the Company’s consolidated revenues.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost of Product Revenue |
Cost of Product Revenue
Cost of product revenue includes costs associated with the manufacture of the Company’s FDA approved products,
intermediates and the sale of human source plasma, as well as expenses related to conformance batch production, process development and scientific and technical operations when these operations are attributable to marketed products. When the
activities of these operations are attributable to new products in development, the expenses are classified as research and development expenses.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Per Common Share |
Loss Per Common Share
Basic loss per common share is computed by dividing net loss attributable to common stockholders by the
weighted average number of shares of common stock outstanding during the period. Diluted loss per common share is calculated by dividing net loss attributable to common stockholders, as adjusted for the effect of dilutive securities, if
any, by the weighted average number of shares of common stock and dilutive common stock outstanding during the period. Potentially dilutive common stock includes the shares of common stock issuable upon the exercise of outstanding stock
options and warrants, using the treasury stock method, as well as Restricted Stock Units (“RSUs”). Potentially dilutive common stock is excluded from the diluted loss per common share computation to the extent that it would be
anti-dilutive. As a result, no potentially dilutive securities are included in the computation of any of the accompanying diluted loss per share amounts in the accompanying condensed consolidated financial statements as the Company reported
a net loss for all periods presented. For the six months ended June 30, 2023 and 2022, the
following securities were excluded from the calculation of diluted loss per common share because of their anti-dilutive effects:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation |
Stock-Based Compensation
The Company follows recognized accounting guidance which requires all equity-based payments, including grants of stock
options, to be recognized in the statement of operations as compensation expense based on their fair values at the date of grant. Compensation expense related to awards to employees and directors with service-based vesting conditions is
generally recognized on a straight-line basis over the associated vesting period of the award based on the grant date fair value of the award. Stock options granted under the Company’s equity incentive plans generally have a four-year vesting period and a term of 10
years. Pursuant to ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting (Topic 718), the Company has elected not to establish a forfeiture rate, as stock-based compensation expense
related to forfeitures of unvested stock options is fully reversed at the time of forfeiture.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes |
Income Taxes
The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or its tax returns. Under this
method, deferred tax assets and liabilities are recognized for the temporary differences between the tax bases of assets and liabilities and their respective financial reporting amounts at enacted tax rates in effect for the years in which
the temporary differences are expected to reverse. The Company records a valuation allowance on its deferred tax assets if it is more likely than not that the Company will not generate sufficient taxable income to utilize its deferred tax
assets. The Company is subject to income tax examinations by major taxing authorities for all tax years since 2018 and for previous periods as it relates to the Company’s net operating loss carryforwards.
In accordance with U.S. GAAP, the Company is required to determine whether a tax position of the Company is more likely than not to be sustained upon examination by
the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit to be recognized is measured as the largest amount of benefit that is
greater than 50% likely of being realized upon ultimate settlement. Derecognition of a tax benefit previously recognized could result in the Company recording a tax liability that would reduce net assets. Based on its analysis, the Company
has determined that it has not incurred any liability for unrecognized tax benefits as of June 30, 2023 and December 31,
2022, and during the six months ended June 30, 2023 and 2022 the Company recognized no
adjustments for uncertain tax positions.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculation of Diluted Loss Per Common Share | For the six months ended June 30, 2023 and 2022, the
following securities were excluded from the calculation of diluted loss per common share because of their anti-dilutive effects:
|
INVENTORIES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Components of Inventory |
The following table provides the components of inventories:
|
INTANGIBLE ASSETS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INTANGIBLE ASSETS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets |
Intangible assets at June 30, 2023 and December 31, 2022 consist of the following:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Asset Future Aggregate Amortization Expense |
All of the Company’s intangible assets were acquired in the
Biotest Transaction. Amortization expense related to these intangible assets was $0.2 million for the three months ended June 30,
2023 and 2022, and $0.4 million for the six months ended June 30, 2023 and 2022. Estimated future aggregate amortization expense is expected to be as follows:
|
PROPERTY AND EQUIPMENT (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment |
Property and equipment and related accumulated depreciation are summarized as
follows:
|
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses and Other Current Liabilities |
Accrued expenses and other current liabilities at June 30, 2023 and December 31, 2022 are as follows:
|
DEBT (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
DEBT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Summary of Outstanding Senior Notes Payable |
A summary of outstanding senior notes payable is as follows:
|
STOCKHOLDERS' EQUITY (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assumptions | The following assumptions were used to determine the fair value of options granted during the six months ended June 30, 2023 and 2022:
|
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Schedule of Option Activity |
A summary of the Company’s option activity under the Company’s equity incentive plans and related information is as
follows:
|
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Schedule of Unvested RSU Activity | A summary of the
Company’s unvested RSU activity and related information is as follows:
|
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Schedule of Stock-Based Compensation Expense |
Total stock-based compensation expense for all awards granted under the Company’s equity incentive plans for the three
and six months ended June 30, 2023 and 2022 is as follows:
|
SEGMENTS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized Financial Information Concerning Reportable Segments | Summarized financial information concerning reportable segments is shown in the following tables:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Revenues According to Geographic Area |
Net revenues according to geographic area, based on the location of where the product is shipped, is as follows:
|
LEASE OBLIGATIONS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASE OBLIGATIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payments Under Lease Obligations | Scheduled payments under the Company’s lease obligations are as follows:
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information |
Supplemental cash flow information for the six months ended June 30, 2023 and 2022 is as follows:
|
ORGANIZATION AND BUSINESS (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2023
USD ($)
Facility
Product
| |
Organization and Business [Abstract] | |
Number of plasma collection facilities under approval and development | Facility | 10 |
Number of FDA-licensed plasma collection facilities | Facility | 9 |
Number of FDA approved product | Product | 3 |
Working capital | $ | $ 224.3 |
Cash and cash equivalents | $ | $ 62.5 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Accounts Receivable (Details) $ in Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023
USD ($)
Customer
|
Dec. 31, 2022
USD ($)
Customer
|
|
Accounts Receivable [Abstract] | ||
Accounts receivable, allowances for contractual credits and doubtful accounts | $ | $ 0.2 | $ 0.1 |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Three Customers [Member] | ||
Accounts Receivable [Abstract] | ||
Number of customers | Customer | 3 | 2 |
Percentage of account receivables | 94.00% | 92.00% |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Goodwill (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Goodwill [Abstract] | |||||
Goodwill | $ 3,529,509 | $ 3,529,509 | $ 3,529,509 | ||
Impairment charges related to goodwill | $ 0 | $ 0 | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Impairment of Long-lived Assets (Details) - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Impairment of Long-lived Assets [Abstract] | ||||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Revenue Recognition (Details) - Customer |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Two Customers [Member] | Revenues [Member] | Customer Concentration Risk [Member] | ||
Revenue Recognition [Abstract] | ||
Number of customers | 2 | 2 |
Percentage of consolidated revenues | 68.00% | 73.00% |
Biotest License Agreement [Member] | ||
Revenue Recognition [Abstract] | ||
Amortization period | 22 years |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Loss per Common Share (Details) - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Loss Per Common Share [Abstract] | ||
Potentially dilutive securities (in shares) | 26,962,867 | 26,803,460 |
Stock Options [Member] | ||
Loss Per Common Share [Abstract] | ||
Potentially dilutive securities (in shares) | 9,641,312 | 8,504,179 |
Restricted Stock Units [Member] | ||
Loss Per Common Share [Abstract] | ||
Potentially dilutive securities (in shares) | 4,818,649 | 4,742,383 |
Warrants [Member] | ||
Loss Per Common Share [Abstract] | ||
Potentially dilutive securities (in shares) | 12,502,906 | 13,556,898 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Stock-based Compensation (Details) |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Stock-based Compensation [Abstract] | |
Equity incentive plans, vesting period | 4 years |
Equity incentive plans, term | 10 years |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Income Taxes (Details) - USD ($) |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Income Taxes [Abstract] | |||
Unrecognized tax benefits | $ 0 | $ 0 | |
Uncertain tax positions | $ 0 | $ 0 |
INVENTORIES (Details) - USD ($) |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
INVENTORIES [Abstract] | ||
Raw materials | $ 49,999,565 | $ 48,644,527 |
Work-in-process | 59,438,404 | 56,170,853 |
Finished goods | 52,342,094 | 58,464,667 |
Total inventories | $ 161,780,063 | $ 163,280,047 |
INTANGIBLE ASSETS, Summary (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Cost | $ 5,007,467 | $ 5,007,467 | $ 5,007,467 | ||
Accumulated amortization | 4,351,727 | 4,351,727 | 3,994,052 | ||
Net | 655,740 | 655,740 | 1,013,415 | ||
Amortization of intangible assets | 178,838 | $ 178,838 | 357,676 | $ 357,676 | |
Trademark and Other Intangible Rights Related to Nabi-HB [Member] | |||||
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Cost | 4,100,046 | 4,100,046 | 4,100,046 | ||
Accumulated amortization | 3,563,135 | 3,563,135 | 3,270,276 | ||
Net | 536,911 | 536,911 | 829,770 | ||
Rights to Intermediates [Member] | |||||
Finite-Lived Intangible Assets, Net [Abstract] | |||||
Cost | 907,421 | 907,421 | 907,421 | ||
Accumulated amortization | 788,592 | 788,592 | 723,776 | ||
Net | $ 118,829 | $ 118,829 | $ 183,645 |
INTANGIBLE ASSETS, Future Aggregate Amortization Expense (Details) |
Jun. 30, 2023
USD ($)
|
---|---|
Estimated Aggregate Amortization Expense [Abstract] | |
Remainder of 2023 | $ 357,676 |
2024 | $ 298,064 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Accrued Expenses and Other Current Liabilities [Abstract] | ||
Accrued rebates | $ 16,029,095 | $ 11,436,484 |
Accrued distribution fees | 5,344,306 | 3,166,896 |
Accrued incentives | 2,200,871 | 4,193,919 |
Accrued testing | 301,980 | 309,867 |
Accrued payroll and other compensation | 2,671,851 | 4,086,379 |
Other | 2,197,495 | 1,795,804 |
Total accrued expenses and other current liabilities | $ 28,745,598 | $ 24,989,349 |
STOCKHOLDERS' EQUITY, Preferred Stock (Details) - $ / shares |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Preferred Stock [Abstract] | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, outstanding (in shares) | 0 | 0 |
STOCKHOLDERS' EQUITY, Common Stock (Details) - $ / shares |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Common Stock [Abstract] | ||
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares outstanding (in shares) | 224,526,748 | 221,816,930 |
Warrants outstanding (in shares) | 46,940,501 | |
Common stock, available for issuance (in shares) | 28,532,751 |
RELATED PARTY TRANSACTIONS (Details) - Related Party [Member] - USD ($) |
1 Months Ended | 3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|---|
Jan. 31, 2016 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Perceptive [Member] | |||||
Related Party Transactions [Abstract] | |||||
Minimum percentage of common stock held by lender | 5.00% | ||||
Areth, LLC [Member] | |||||
Related Party Transactions [Abstract] | |||||
Rent expense | $ 10,000 | $ 30,000 | $ 60,000 | $ 30,000 | $ 60,000 |
Genesis [Member] | |||||
Related Party Transactions [Abstract] | |||||
Purchased materials amount | $ 200,000 | $ 100,000 |
SEGMENTS (Details) |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2023
USD ($)
|
Mar. 31, 2023
USD ($)
|
Jun. 30, 2022
USD ($)
|
Mar. 31, 2022
USD ($)
|
Jun. 30, 2023
USD ($)
Facility
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Segment Reporting Information [Abstract] | |||||||
Number of FDA-licensed plasma collection facilities | Facility | 9 | ||||||
Number of remaining plasma collection facilities under construction | Facility | 10 | ||||||
Revenues | $ 60,123,191 | $ 33,905,007 | $ 117,036,725 | $ 63,008,100 | |||
Cost of product revenue | 43,433,188 | 26,135,614 | 83,833,732 | 51,576,660 | |||
Income (loss) from operations | (473,077) | (9,174,739) | (1,286,395) | (23,989,805) | |||
Interest and other expense, net | (5,897,630) | (4,590,167) | (11,873,127) | (8,113,017) | |||
Loss on extinguishment of debt | 0 | 0 | 0 | (6,669,941) | |||
Net income (loss) | (6,370,707) | $ (6,788,815) | (13,764,906) | $ (25,007,857) | (13,159,522) | (38,772,763) | |
Capital expenditures | 2,817,229 | 6,782,169 | |||||
Total assets | 343,027,042 | 296,932,329 | 343,027,042 | 296,932,329 | $ 348,461,881 | ||
Depreciation and amortization expense | 2,097,577 | 1,724,283 | 4,130,542 | 3,314,500 | |||
United States [Member] | |||||||
Segment Reporting Information [Abstract] | |||||||
Revenues | 56,607,815 | 31,274,844 | 109,302,538 | 58,590,995 | |||
International [Member] | |||||||
Segment Reporting Information [Abstract] | |||||||
Revenues | 3,515,376 | 2,630,163 | 7,734,187 | 4,417,105 | |||
Corporate [Member] | |||||||
Segment Reporting Information [Abstract] | |||||||
Revenues | 35,709 | 35,709 | 71,417 | 71,417 | |||
Cost of product revenue | 0 | 0 | 0 | 0 | |||
Income (loss) from operations | (5,157,228) | (4,708,692) | (10,500,652) | (11,385,373) | |||
Interest and other expense, net | (5,892,031) | (4,572,035) | (11,843,522) | (8,044,889) | |||
Loss on extinguishment of debt | (6,669,941) | ||||||
Net income (loss) | (11,049,259) | (9,280,727) | (22,344,174) | (26,100,203) | |||
Capital expenditures | 0 | 0 | |||||
Total assets | 57,404,583 | 42,800,955 | 57,404,583 | 42,800,955 | |||
Depreciation and amortization expense | 0 | 155 | 0 | 918 | |||
Operating Segments [Member] | ADMA BioManufacturing [Member] | |||||||
Segment Reporting Information [Abstract] | |||||||
Revenues | 59,761,136 | 32,120,119 | 109,338,071 | 57,848,744 | |||
Cost of product revenue | 43,040,754 | 24,287,122 | 76,974,537 | 46,500,902 | |||
Income (loss) from operations | 6,083,663 | (445,248) | 11,560,102 | (4,720,538) | |||
Interest and other expense, net | (5,622) | (17,796) | (29,401) | (67,062) | |||
Loss on extinguishment of debt | 0 | ||||||
Net income (loss) | 6,078,041 | (463,044) | 11,530,701 | (4,787,600) | |||
Capital expenditures | 1,195,202 | 2,584,906 | |||||
Total assets | 248,163,333 | 220,052,465 | 248,163,333 | 220,052,465 | |||
Depreciation and amortization expense | 1,282,401 | 1,159,732 | 2,575,009 | 2,271,683 | |||
Operating Segments [Member] | Plasma Collection Centers [Member] | |||||||
Segment Reporting Information [Abstract] | |||||||
Revenues | 326,346 | 1,749,179 | 7,627,237 | 5,087,939 | |||
Cost of product revenue | 392,434 | 1,848,492 | 6,859,195 | 5,075,758 | |||
Income (loss) from operations | (1,399,512) | (4,020,799) | (2,345,845) | (7,883,894) | |||
Interest and other expense, net | 23 | (336) | (204) | (1,066) | |||
Loss on extinguishment of debt | 0 | ||||||
Net income (loss) | (1,399,489) | (4,021,135) | (2,346,049) | (7,884,960) | |||
Capital expenditures | 1,622,027 | 4,197,263 | |||||
Total assets | 37,459,126 | 34,078,909 | 37,459,126 | 34,078,909 | |||
Depreciation and amortization expense | $ 815,176 | $ 564,396 | $ 1,555,533 | $ 1,041,899 |
LEASE OBLIGATIONS (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
LEASE OBLIGATIONS [Abstract] | |||||
Aggregate lease expense | $ 600,000 | $ 500,000 | $ 1,200,000 | $ 900,000 | |
Cash payments for lease | 600,000 | $ 400,000 | 1,100,000 | $ 800,000 | |
Operating and financing lease liabilities | $ 11,200,000 | $ 11,200,000 | $ 11,600,000 | ||
Weighted average remaining term | 8 years 1 month 6 days | 8 years 1 month 6 days | |||
Payments Under Lease Obligations [Abstract] | |||||
Remainder of 2023 | $ 1,213,264 | $ 1,213,264 | |||
Year ended December 31, 2024 | 2,343,314 | 2,343,314 | |||
2025 | 2,366,432 | 2,366,432 | |||
2026 | 2,116,036 | 2,116,036 | |||
2027 | 2,040,690 | 2,040,690 | |||
2028 | 2,087,825 | 2,087,825 | |||
Thereafter | 6,150,746 | 6,150,746 | |||
Total payments | 18,318,307 | 18,318,307 | |||
Less: imputed interest | (7,116,857) | (7,116,857) | |||
Current portion | (979,536) | (979,536) | (905,369) | ||
Balance at June 30, 2023 | $ 10,221,914 | $ 10,221,914 | $ 10,704,176 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
SUPPLEMENTAL CASH FLOW INFORMATION [Abstract] | ||
Cash paid for interest | $ 9,273,681 | $ 5,989,332 |
Noncash Financing and Investing Activities [Abstract] | ||
Equipment acquired reflected in accounts payable and accrued liabilities | 511,377 | 1,164,319 |
Right-to-use assets in exchange for lease obligations | 0 | 3,660,890 |
Warrants issued in connection with notes payable | $ 5,594,764 | $ 9,569,604 |
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