8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 1, 2022

BIOSTAGE, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-35853	45-5210462
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

84 October Hill Road, Suite 11, Holliston, MA	01746
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code: (774) 233-7300

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐

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

Item 2.02.Results of Operations and Financial Condition.

On April 1, 2022, Biostage, Inc. issued a press release announcing financial results for the three months and year ended December 31, 2021 and the details of a related conference call to be held at 9:00 A.M. ET on April 1, 2022. The press release is furnished as Exhibit 99.1 and incorporated herein by reference.

The information in this Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01.Financial Statements and Exhibits.

(d)Exhibits.

Exhibit Number	Title
99.1	Press Release issued by Biostage, Inc. on April 1, 2022
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	BIOSTAGE, INC.
	(Registrant)
April 1, 2022	/s/   David Green
(Date)	David Green
	Interm Chief Executive Officer, Director, and Chairman

EX-99.1

Exhibit 99.1

Biostage Reports Fourth Quarter and Fiscal Year 2021 Financial Results

HOLLISTON, Mass., April 1, 2022 /PRNewswire/ -- Biostage, Inc. (OTCQB: BSTG) ("Biostage" or the "Company"), a cell-therapy biotechnology company with successful "first-in-human" experience in treating esophageal cancer (conducted at the Mayo Clinic and published last August) and FDA approval to commence a clinical trial of the Biostage Esophageal Implant for severe esophageal disease including cancer, today announced its financial results for the three months and year ended December 31, 2021.

The Company will be hosting a conference call on Friday, April 1, 2022 at 9:00 A.M. Eastern Time. You can access the live conference call by dialing the following phone numbers toll free 877-407-8293 or international +1 201-689-8349.

Summary of Financial Results

For the three months ended December 31, 2021, the Company reported a net loss of $5.9 million, or $0.55 per share, as compared to a net loss of $1.0 million, or $0.12 per share, for the three months ended December 31, 2020. The $4.9 million quarter-over-quarter increase in net loss was due primarily to a charge of approximately $3.3 million relating to the contingency matter for our ongoing litigation for a wrongful death complaint and related matters more fully described in Note 9 to our consolidated financial statements and an increase in legal costs of approximately $1.3 million for fees for filing claims against our insurance carrier to seek continuance of insurance coverage for the same litigation. In addition, research and development costs increased $0.2 million and the Company recognized lower grant income for qualified expenditures from the SBIR grant of $0.1 million as the grant expired effective September 30, 2021.

Net loss increased approximately $3.1 million to approximately $8.0 million, or $0.79 per share, for the year ended December 31, 2021 as compared to approximately $4.9 million, or $0.55 per share, for the year ended December 31, 2020.

The $3.1 million year-over-year increase in net loss was due primarily to a charge of approximately $3.3 million relating to the contingency matter for our ongoing litigation for a wrongful death complaint and related matters more fully described in Note 9 to our consolidated financial statements and an increase in legal costs of approximately $1.3 million for fees for filing claims against our insurance carrier to seek continuance of insurance coverage for the same litigation. These increases are offset, in part, by

approximately $0.8 million of lower employee and share-based expenses due to the separations of our former chief executive and chief financial officers during 2020.

In addition, research and development costs decreased by $0.5 million Notes Payable were forgiven resulting in a $0.4 million gain and grant income decreased by $0.2 million which account for the change in net loss year-over-year.

Balance Sheet and Cash

As of December 31, 2021, the Company had operating cash on-hand of $1.2 million, a decrease of $0.2 million from the prior year. During the year ended December 31, 2021, the Company used net cash in operations of $2.6 million, which was offset, in total, by $2.8 million of proceeds from private placement transactions that resulted in the issuance of 1,372,464 shares of our common stock and warrants to existing investors.

We expect that our operating cash on-hand as of December 31, 2021 of $1.2 million will enable us to fund our operating expenses and capital expenditure requirements into early third quarter of 2022.

About Biostage.

Biostage is a clinical-stage biotech company that uses cell therapy to regenerate organs inside the human body to treat cancer, trauma and birth defects. We have performed the world's first regeneration of an esophagus in a human cancer patient. This surgery was performed at Mayo Clinic and was published in August 2021. 

Biostage has 7 issued U.S. patents, 2 orphan-drug designations (which provide 7 years of market exclusivity in addition to any patents), and the possibility of 2 Priority Review Vouchers from the FDA. 

Biostage's current goals include raising capital, uplisting from the OTC bulletin board to NASDAQ and beginning its clinical trial for repair of the esophagus in adults. 

For more information, please visit www.biostage.com and connect with the Company on Twitter and LinkedIn.

Forward-Looking Statements 

Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements in this press release include, but are not limited to, statements relating to the capabilities and performance of our products and product candidates; our capital raising plans and expectations, including uplifting to NASDAQ; development expectations and regulatory approval of any of the Company's products, including those utilizing its Biostage Esophageal Implant technology, by the U.S. Food and Drug Administration, the European Medicines Agency or otherwise, which expectations or approvals may not be achieved or obtained on a timely basis or at all; and success with respect to any collaborations, clinical trials and other development and commercialization efforts of the Company's products, which such success may not be achieved or obtained on a timely basis or at all. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including, among other things, the Company's inability to obtain needed funds in the immediate future; the Company's ability to obtain and maintain regulatory approval for its products; plus other factors described under the heading "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021 or described in the Company's other public filings. The Company's results may also be affected by factors of which the Company is not currently aware. The forward-looking statements in this press release speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.

Investor Relations Contact

Shunfu Hu

Vice President of Business Developmentand Operations

774-233-7300

shu@biostage.com

Biostage, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	December 31,		December 31,
	2021		2020
Assets
Cash	$	1,242	$	1,026
Restricted cash		50		50
Other assets		574		1,000
Total assets	$	1,866	$	2,076
Liabilities and stockholders' (deficit) equity
Other liabilities	$	1,645	$	547
Accrual for contingency matter		3,250		-
Notes payable		-		404
Total liabilities		4,895		951
Total stockholders’ (deficit) equity		(3,029)		1,125
	$	1,866	$	2,076

BIOSTAGE, INC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended December 31,				For the Year Ended December 31,
	2021		2020		2021		2020
Operating expenses
Research and development	$	569	$	342	$	1,592	$	2,069
General and administrative		5,332		768		7,044		3,256
Total operating expenses		5,901		1,110		8,636		5,325
Other income (expense)
Forgiveness of notes payable		-		-		408		-
Grant income		-		77		165		447
Change in fair value of warrant liability		29		10		15		16
Other income (expense), net		(1)		(1)		70		(3)
Total other income, net		28		86		658		460
Net loss	$	(5,873)	$	(1,024)	$	(7,978)	$	(4,865)
Basic and diluted net loss per share	$	(0.55)	$	(0.12)	$	(0.79)	$	(0.55)
Weighted-average common shares, basic and diluted		10,717		8,855		10,062		8,794

XML

Document and Entity Information	Apr. 01, 2022
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Apr. 01, 2022
Entity File Number	001-35853
Entity Registrant Name	BIOSTAGE, INC.
Entity Central Index Key	0001563665
Entity Tax Identification Number	45-5210462
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	84 October Hill Road
Entity Address, Adress Line Two	Suite 11
Entity Address, City or Town	Holliston
Entity Address State Or Province	MA
Entity Address, Postal Zip Code	01746
City Area Code	774
Local Phone Number	233-7300
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false