DELAWARE
|
94-3076866
|
(State or other jurisdiction of incorporation or organization)
|
(IRS Employer Identification No.)
|
PART I. FINANCIAL INFORMATION
|
|||
Item 1.
|
Consolidated Financial Statements
|
3 | |
Consolidated Balance Sheets as of March 31, 2015 (unaudited) and December 31, 2014
|
3 | ||
Consolidated Statements of Operations (unaudited) for the three month periods ended March 31, 2015 and 2014
|
4 | ||
Consolidated Statements of Comprehensive (Loss) (unaudited) for the three month periods ended March 31, 2015 and 2014
|
5 | ||
Consolidated Statements of Cash Flows (unaudited) for the three month periods ended March 31, 2015 and 2014
|
6 | ||
Notes to Consolidated Financial Statements (unaudited)
|
7 | ||
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
12 | |
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
16 | |
Item 4.
|
Controls and Procedures
|
16 | |
PART II. OTHER INFORMATION | |||
Item 6.
|
Exhibits
|
17
|
|
Signatures
|
18 | ||
Index to Exhibits
|
|
19 |
March 31,
|
December 31,
|
|||||||
2015
|
2014
|
|||||||
Assets
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$
|
2,971,840
|
$
|
2,538,758
|
||||
Short term investments
|
5,606,453
|
7,399,636
|
||||||
Accounts receivable, trade, net of allowance for doubtful accounts of $0 at March 31, 2015 and December 31, 2014
|
851,044
|
901,623
|
||||||
Inventories
|
1,242,787
|
965,224
|
||||||
Prepaid expenses and other current assets
|
289,018
|
360,521
|
||||||
Total current assets
|
10,961,142
|
12,165,762
|
||||||
Property and equipment
|
||||||||
Leasehold improvements
|
1,284,491
|
1,284,491
|
||||||
Furniture and computer equipment
|
500,313
|
476,788
|
||||||
Manufacturing and other equipment
|
989,989
|
972,386
|
||||||
Subtotal
|
2,774,793
|
2,733,665
|
||||||
Less: Accumulated depreciation
|
(1,161,706
|
)
|
(1,078,060
|
)
|
||||
Net property and equipment
|
1,613,087
|
1,655,605
|
||||||
Internal use software
|
334,640
|
––
|
||||||
Intangible asset
|
2,215,385
|
2,215,385
|
||||||
Long term deposits
|
36,166
|
36,166
|
||||||
Total assets
|
$
|
15,160,420
|
$
|
16,072,918
|
||||
Liabilities and Shareholders’ Equity
|
||||||||
Current liabilities
|
||||||||
Accounts payable
|
$
|
900,348
|
$
|
474,662
|
||||
Accrued expenses and other current liabilities
|
160,898
|
121,869
|
||||||
Accrued compensation
|
272,923
|
535,029
|
||||||
Deferred rent
|
130,216
|
130,216
|
||||||
Total current liabilities
|
1,464,385
|
1,261,776
|
||||||
Long term liabilities
|
||||||||
Deferred rent, long term
|
848,041
|
874,825
|
||||||
Total liabilities
|
2,312,426
|
2,136,601
|
||||||
Commitments and contingencies (Note 10)
|
||||||||
Shareholders' equity
|
||||||||
Common stock, $0.001 par value; 150,000,000 shares authorized, 12,107,101 and 12,084,859 shares issued and outstanding at March 31, 2015 and December 31, 2014
|
12,107
|
12,084
|
||||||
Additional paid-in capital
|
71,969,748
|
71,911,328
|
||||||
Accumulated other comprehensive loss
|
(949
|
)
|
(6,448
|
)
|
||||
Accumulated deficit
|
(61,144,469
|
)
|
(60,112,987
|
)
|
||||
Total BioLife Solutions, Inc. shareholders' equity
|
10,836,437
|
11,803,977
|
||||||
Total non-controlling interest equity
|
2,011,557
|
2,132,340
|
||||||
Total shareholders' equity
|
12,847,994
|
13,936,317
|
||||||
Total liabilities and shareholders' equity
|
$
|
15,160,420
|
$
|
16,072,918
|
Three Month Period Ended March 31,
|
||||||||
2015
|
2014
|
|||||||
Product revenue
|
$
|
1,500,722
|
$
|
2,065,030
|
||||
Cost of product sales
|
618,099
|
1,161,641
|
||||||
Gross profit
|
882,623
|
903,389
|
||||||
Operating expenses
|
||||||||
Research and development
|
322,165
|
167,287
|
||||||
Sales and marketing
|
500,255
|
241,400
|
||||||
General and administrative
|
1,220,705
|
863,743
|
||||||
Total operating expenses
|
2,043,125
|
1,272,430
|
||||||
Operating loss
|
(1,160,502
|
)
|
(369,041
|
)
|
||||
Other income (expenses)
|
||||||||
Interest income
|
8,237
|
––
|
||||||
Interest expense
|
––
|
(177,308
|
)
|
|||||
Amortization of deferred financing costs
|
––
|
(13,022
|
)
|
|||||
Total other income (expenses)
|
8,237
|
(190,330
|
)
|
|||||
Net Loss
|
(1,152,265
|
)
|
(559,371
|
)
|
||||
Net loss attributable to non-controlling interest
|
120,783
|
––
|
||||||
Net Loss attributable to BioLife Solutions, Inc.
|
$
|
(1,031,482
|
)
|
$
|
(559,371
|
)
|
||
Basic and diluted net loss per common share attributable to BioLife Solutions, Inc.
|
$
|
(0.09
|
)
|
$
|
(0.10
|
)
|
||
Basic and diluted weighted average common shares used to calculate net loss per common share
|
12,100,588
|
5,568,802
|
Three Month Period Ended March 31,
|
||||||||
2015
|
2014
|
|||||||
Net loss
|
$
|
(1,152,265
|
)
|
$
|
(559,371
|
)
|
||
Other comprehensive income
|
||||||||
Unrealized gain on available-for-sale investments
|
5,499
|
––
|
||||||
Total other comprehensive income
|
5,499
|
––
|
||||||
Comprehensive loss attributable to non-controlling interest
|
120,783 |
––
|
||||||
Comprehensive loss attributable to BioLife Solutions, Inc.
|
$
|
(1,025,983
|
)
|
$
|
(559,371
|
)
|
Three Month Period Ended
March 31,
|
||||||||
2015
|
2014
|
|||||||
Cash flows from operating activities
|
||||||||
Net loss
|
$
|
(1,152,265
|
)
|
$
|
(559,371
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities
|
||||||||
Depreciation
|
83,646
|
62,506
|
||||||
Stock-based compensation expense
|
33,509
|
51,619
|
||||||
Stock issued for services
|
––
|
80,000
|
||||||
Amortization of deferred financing costs
|
––
|
13,022
|
||||||
Amortization of deferred rent related to lease incentives
|
(31,750
|
)
|
(39,778
|
)
|
||||
Accretion and amortization on available for sale investments
|
40,901
|
––
|
||||||
Change in operating assets and liabilities
|
||||||||
(Increase) Decrease in
|
||||||||
Accounts receivable, trade
|
50,579
|
(316,248
|
)
|
|||||
Inventories
|
(277,563
|
)
|
123,819
|
|||||
Prepaid expenses and other current assets
|
72,156
|
88,961
|
||||||
Increase (Decrease) in
|
||||||||
Accounts payable
|
221,046
|
(159,087
|
)
|
|||||
Accrued compensation and other current liabilities
|
(353,077
|
)
|
(411,650
|
)
|
||||
Accrued interest, related parties
|
––
|
177,308
|
||||||
Deferred rent
|
4,966
|
(5,227
|
)
|
|||||
Net cash used in operating activities
|
(1,307,852
|
)
|
(894,126
|
)
|
||||
Cash flows from investing activities
|
||||||||
Sales of available-for-sale investments
|
2,100,000
|
––
|
||||||
Purchases of available-for-sale investments
|
(342,872
|
)
|
––
|
|||||
Purchase of property and equipment
|
(41,128
|
)
|
(18,777
|
)
|
||||
Net provided by (used in) investing activities
|
1,716,000
|
(18,777
|
)
|
|||||
Cash flows from financing activities
|
||||||||
Proceeds from sale of common stock, net of expenses
|
––
|
13,596,230
|
||||||
Proceeds from exercise of common stock options
|
24,934
|
––
|
||||||
Net cash provided by financing activities
|
24,934
|
13,596,230
|
||||||
Net increase in cash and cash equivalents
|
433,082
|
12,683,327
|
||||||
Cash and cash equivalents - beginning of period
|
2,538,758
|
156,273
|
||||||
Cash and cash equivalents - end of period
|
$
|
2,971,840
|
$
|
12,839,600
|
||||
Non-cash investing activities
|
||||||||
Costs incurred for capitalized internal use software not paid as of quarter end (amounts are included in liabilities)
|
$
|
334,640
|
$
|
––
|
||||
Non-cash financing activities
|
||||||||
Conversion of notes payable and related party accrued interest to equity, net of unamortized deferred finance costs
|
$
|
––
|
$
|
14,180,193
|
1.
|
Organization and Significant Accounting Policies
|
2.
|
Accumulated Other Comprehensive Loss
|
Three Months Ended
March 31,
2015
|
||||
Unrealized Loss on Investments, Beginning Balance
|
$
|
(6,448
|
)
|
|
Unrealized Gain on Investments, Current Period
|
5,499
|
|||
Unrealized Loss on Investments, Ending Balance
|
$
|
(949
|
)
|
3.
|
Fair Value Measurement
|
As of March 31, 2015
|
Level 1
|
Level 2
|
Total
|
|||||||||
Bank deposits
|
$
|
414,840
|
$
|
—
|
$
|
414,840
|
||||||
Money market funds
|
2,557,000
|
—
|
2,557,000
|
|||||||||
Cash and cash equivalents
|
2,971,840
|
—
|
2,971,840
|
|||||||||
Corporate debt securities
|
5,606,453
|
—
|
5,606,453
|
|||||||||
Total
|
$
|
8,578,293
|
$
|
—
|
$
|
8,578,293
|
As of December 31, 2014
|
Level 1
|
Level 2
|
Total
|
|||||||||
Bank deposits
|
$
|
972,891
|
$
|
—
|
$
|
972,891
|
||||||
Money market funds
|
1,565,867
|
—
|
1,565,867
|
|||||||||
Cash and cash equivalents
|
2,538,758
|
—
|
2,538,758
|
|||||||||
Corporate debt securities
|
6,799,702
|
—
|
6,799,702
|
|||||||||
Commercial paper
|
599,934
|
—
|
599,934
|
|||||||||
Short term investments
|
7,399,636
|
—
|
7,399,636
|
|||||||||
Total
|
$
|
9,938,394
|
$
|
—
|
$
|
9,938,394
|
4.
|
Short Term Investments
|
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Fair Value
|
|||||||||||||
Corporate debt securities
|
$ | 5,607,402 | $ | — | $ | (949 | ) | $ | 5,606,453 |
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Fair Value
|
|||||||||||||
Corporate debt securities
|
$ | 6,806,150 | $ | — | $ | (6,448 | ) | $ | 6,799,702 | |||||||
Commercial paper
|
599,934 | — | $ | — | 599,934 | |||||||||||
Total marketable securities
|
$ | 7,406,084 | $ | — | $ | (6,448 | ) | $ | 7,399,636 |
5.
|
Inventory
|
March 31,
2015
|
December 31,
2014
|
|||||||
Raw materials
|
$
|
367,719
|
$
|
362,656
|
||||
Work in progress
|
345,314
|
79,012
|
||||||
Finished goods
|
529,754
|
523,556
|
||||||
Total
|
$
|
1,242,787
|
$
|
965,224
|
6.
|
Deferred Rent
|
March 31,
2015
|
December 31,
2014
|
|||||||
Landlord-funded leasehold improvements
|
$ | 1,124,790 | $ | 1,124,790 | ||||
Less accumulated amortization
|
(280,281 | (248,531 | ) | |||||
Total
|
844,509 | 876,259 | ||||||
Straight line rent adjustment
|
133,748 | 128,782 | ||||||
Total deferred rent
|
$ | 978,257 | $ | 1,005,041 |
7.
|
Share-based Compensation
|
Three Month Period Ended
|
||||||||
March 31, 2015
|
||||||||
Wtd. Avg.
|
||||||||
Exercise
|
||||||||
Options
|
Price
|
|||||||
Outstanding at beginning of year
|
1,390,770
|
$
|
1.50
|
|||||
Exercised
|
(22,242
|
)
|
1.12
|
|||||
Outstanding at March 31, 2015
|
1,368,528
|
$
|
1.51
|
|||||
Stock options exercisable at March 31, 2015
|
1,233,272
|
$
|
1.34
|
Three Month Period Ended
|
||||||||
March 31,
|
||||||||
2015
|
2014
|
|||||||
Research and development costs
|
$
|
6,944
|
$
|
8,135
|
||||
Sales and marketing costs
|
5,755
|
2,723
|
||||||
General and administrative costs
|
7,773
|
26,165
|
||||||
Cost of product sales
|
13,037
|
14,596
|
||||||
Total
|
$
|
33,509
|
$
|
51,619
|
8.
|
Warrants
|
9.
|
Net Loss per Common Share
|
Three Month Period Ended
March 31,
|
||||||||
2015
|
2014
|
|||||||
Basic and diluted weighted average common stock shares outstanding
|
12,100,588 | 5,568,802 | ||||||
Potentially dilutive securities excluded from loss per share computations:
|
||||||||
Common stock options
|
1,368,528 | 1,370,465 | ||||||
Common stock purchase warrants
|
7,428,141 | 7,428,141 |
10.
|
Commitments & Contingencies
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
●
|
anticipated product developments, regulatory filings and related requirements;
|
●
|
timing and amount of future contractual payments, product revenue and operating expenses;
|
●
|
market acceptance of our products and the estimated potential size of these markets; and
|
●
|
projections regarding liquidity, capital requirements and the terms of any financing agreements.
|
●
|
Proprietary core products revenue in the first quarter of 2015 increased 30% over the first quarter of 2014 to a record $1.5 million, reflecting continued adoption of our products in clinical trials in the regenerative medicine market, as well as increased sales to our US and international distributors.
|
●
|
Gross margin in the first quarter of 2015 was 59%, compared to 44% in the first quarter of 2014. The improvement over 2014 is a result of a change in our product mix, with essentially all revenue in the quarter realized from sales of our proprietary biopreservation media products as compared to the first quarter of 2014 that included a significant amount of low margin contract-manufacturing revenue.
|
●
|
Consolidated net loss attributable to BioLife for the first quarter of 2015 was $1.0 million or $0.09/share, compared to a net loss of $0.6 million or $0.10/share in the first quarter of 2014. The increase in the loss is primarily the result of increased headcount and spending related to development and launch activities of our biologistex joint venture.
|
●
|
New Product Introductions: Cell Thawing Media - We commenced GMP manufacturing of low molecular weight dextran solutions for use in thawing human cells after cryopreservation in response to inquiries from numerous customers and clinicians who have been subjected to an extended worldwide shortage of dextran solutions that are used off-label to transition frozen cells to room temperature.
|
●
|
New Data Published by the Mayo Clinic on Product Performance: We announced that our CryoStor cell freeze media was utilized in a Mayo Clinic porcine animal study of umbilical cord blood-derived mononuclear cells (UBC-MNC) to evaluate the safety and feasibility of these cells for cardiac regeneration in pediatric congenital heart disease (CHD).
|
●
|
New Patent: We expanded our intellectual property protection with the granting of new Australian patent number 2009228056
titled, “Materials and Methods for Hypothermic Collection of Whole Blood”.
|
●
|
Innovation Recognition: We received the 2015 Silver Award for Achievement in Medical Technology from Seattle Business Magazine.
|
●
|
Executive Appointments & Awards: Dr. Aby J. Mathew, PhD, Chief Technology Officer, was appointed to the founding board of directors of the newly formed Cord Blood Association. Also, Kevin O’Donnell, Vice President, Cold Chain Standards, Practices, and Compliance was named 2014 Distinguished Editor/Author of the Year by the Parenteral Drug Association, for his published book “Cold Chain Chronicles.
|
Three Month Period Ended
|
||||||||||||
March 31,
|
||||||||||||
2015
|
2014
|
% Change
|
||||||||||
Revenue:
|
||||||||||||
Core product sales
|
$
|
1,477,176
|
$
|
1,132,245
|
30%
|
|||||||
Contract manufacturing services
|
23,546
|
932,785
|
(97)%
|
|||||||||
Total revenue
|
1,500,722
|
2,065,030
|
(27)%
|
|||||||||
Cost of sales
|
618,099
|
1,161,641
|
(47)%
|
|||||||||
Gross profit
|
$
|
882,623
|
$
|
903,389
|
(2)%
|
|||||||
Gross margin %
|
59%
|
44%
|
Three Month Period Ended
|
||||||||||||
March 31,
|
||||||||||||
2015
|
2014
|
% Change
|
||||||||||
Operating Expenses:
|
||||||||||||
Research and development
|
$
|
322,165
|
$
|
167,287
|
93%
|
|||||||
Sales and marketing
|
500,255
|
241,400
|
107%
|
|||||||||
General and administrative
|
1,220,705
|
863,743
|
41%
|
|||||||||
Operating Expenses
|
2,043,125
|
1,272,430
|
61%
|
|||||||||
% of revenue
|
136%
|
62%
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 6.
|
Exhibits
|
BIOLIFE SOLUTIONS, INC.
|
|||
Dated: May 7, 2015
|
By:
|
/s/ Daphne Taylor
|
|
Daphne Taylor
|
|||
Chief Financial Officer
|
|||
(Duly authorized officer and principal financial and accounting officer) |
Exhibit No. | Description | |
31.1 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
/s/ Michael Rice
|
|
Michael Rice
|
|
Chief Executive Officer
|
/s/ Daphne Taylor
|
|
Daphne Taylor
|
|
Chief Financial 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.
|
/s/ Michael Rice
|
|
Michael Rice
|
|
Chief 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.
|
/s/ Daphne Taylor
|
|
Daphne Taylor
|
|
Chief Financial Officer
|
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