UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: December 31, 2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________to _____________

Commission File Number: 001-39015

BIOVIE INC.

(Exact name of registrant as specified in its charter)

Nevada		46-2510769
(State or other jurisdiction of incorporation or organization)		(I.R.S. Empl. Ident. No.)

9120 Double Diamond Parkway Suite 1400

Reno, NV 89521

(Address of principal executive offices, Zip Code)

(775) 888-3162

(Registrant’s telephone number, including area code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share	BIVI	The Nasdaq Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	x
		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 ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

There were 24,984,063 shares of the Registrant’s $0.0001 par value Class A common stock outstanding as of February 4, 2022.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	1
	Condensed Balance Sheets at December 31, 2021 (unaudited) and June 30, 2021	1
	Condensed Statements of Operations (unaudited) - for the three months and six months ended December 31, 2021 and 2020	2
	Condensed Statements of Cash Flows (unaudited) - for the six months ended December 31, 2021 and 2020	3
	Condensed Statements of Changes in Stockholders’ Equity (Deficit) (unaudited) - for the periods from July 1, 2020 through December 31, 2020 and July 1, 2021 through December 31, 2021	4
	Notes to Unaudited Condensed Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	21

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3.	Defaults Upon Senior Securities	22
Item 4.	Mine Safety Disclosures	22
Item 5.	Other Information	22
Item 6.	Exhibits	23

SIGNATURES		24

FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, and Section 27A of the Securities Act of 1933. Any statements contained in this report that are not statements of historical fact may be forward-looking statements. When we use the words “intends,” “estimates,” “predicts,” “potential,” “continues,” “anticipates,” “plans,” “expects,” “believes,” “should,” “could,” “may,” “will” or the negative of these terms or other comparable terminology, we are identifying forward-looking statements. Forward-looking statements involve risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by forward-looking statements. These factors include, among others; our research and development activities and, distributor channel; compliance with regulatory impositions requirements; and our capital needs. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Except as may be required by applicable law, we do not undertake or intend to update or revise our forward-looking statements, and we assume no obligation to update any forward-looking statements contained in this report as a result of new information or future events or developments. Thus, you should not assume that our silence over time means that actual events are bearing out as expressed or implied in such forward-looking statements. You should carefully review and consider the various disclosures we make in this report and our other reports filed with the Securities and Exchange Commission that attempt to advise interested parties of the risks, uncertainties and other factors that may affect our business.

When used in this report, the terms “BioVie”, “Company”, “we”, “our”, and “us” refer to BioVie Inc.

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

BioVie Inc.

Condensed Balance Sheets

	December 31			June 30,
	2021			2021
ASSETS	(Unaudited)

CURRENT ASSETS:
Cash	$	30,391,675		$	4,511,642
Other assets		154,868			93,487
Total current assets		30,546,543			4,605,129

OTHER ASSETS:
Intangible assets, net		981,161			1,095,849
Goodwill		345,711			345,711
Total other assets		1,326,872			1,441,560

TOTAL ASSETS	$	31,873,415		$	6,046,689

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	1,663,089		$	996,374
Current portion of other liabilities		580,625			—
Warrant liabilities		896,959			—
Embedded derivative liability		1,217,765			—
Total current liabilities		4,358,438			996,374

Other liabilities		338,698			—
Note Payable net of financing costs and unearned premium and discount ($3,888,813)		11,111,187			—

TOTAL LIABILITIES		15,808,323			996,374

Commitments and contingencies (Note 10)

STOCKHOLDERS’ EQUITY:

Preferred stock; $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding		—			—
Common stock, $0.0001 par value; 800,000,000 shares authorized at December 31, 2021 and June 30, 2021, respectively; 24,984,083 and 22,333,324 shares issued and outstanding at December 31, 2021 and June 30, 2021, respectively		2,496			2,232

Additional paid in capital		251,903,088			229,933,505
Accumulated deficit		(235,840,492	)		(224,885,422	)
Total stockholders’ equity		16,065,092			5,050,315

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	31,873,415		$	6,046,689

See accompanying notes to unaudited condensed financial statements

-1-

	Three Months Ended			Three Months Ended			Six Months Ended			Six Months Ended
	December 31 2021			December 31 2020			December 31 2021			December 31 2020

OPERATING EXPENSES:
Amortization	$	57,344		$	57,344		$	114,689		$	114,688
Research and development expenses		4,591,432			938,101			7,437,026			1,063,112
Selling, general and administrative expenses		2,016,234			2,067,920			4,660,579			2,272,320
TOTAL OPERATING EXPENSES		6,665,010			3,063,365			12,212,294			3,450,120

LOSS FROM OPERATIONS		(6,665,010	)		(3,063,365	)		(12,212,294	)		(3,450,120	)

OTHER (INCOME) EXPENSE:
Change in fair value of derivative liabilities		(1,555,254	)		—			(1,555,254	)		(8,279,919	)
Interest expense		316,263			143			317,378			559,455
Interest income		(11,702	)		(5,701	)		(19,348	)		(5,765	)
TOTAL OTHER EXPENSE (INCOME), NET		(1,250,693	)		(5,558	)		(1,257,224	)		(7,726,229	)


NET (LOSS)/INCOME	$	(5,414,317	)	$	(3,057,807	)	$	(10,955,070	)	$	4,276,109

Deemed dividends - related party		—			—			—			53,598,320

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	$	(5,414,317	)	$	(3,057,807	)	$	(10,955,070	)	$	(49,322,211	)

NET LOSS PER COMMON SHARE
- Basic	$	(0.22	)	$	(0.22	)	$	(0.45	)	$	(4.95	)
- Diluted	$	(0.22	)	$	(0.22	)	$	(0.45	)	$	(4.95	)

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
- Basic		24,962,373			13,916,164			24,344,545			9,965,599
- Diluted		24,962,373			13,916,164			24,344,545			9,965,599

	Six Months Ended			Six Months Ended
	December 31, 2021			December 31, 2020

CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)/income	$	(10,955,070	)	$	4,276,109
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Amortization of intangible assets		114,689			114,688
Stock based compensation - restricted stock		384,454			—
Stock option based compensation expense		3,074,384			1,536,929
Amortization of financing costs		14,185			—
Accretion of unearned loan discount		133,454			537,275
Accretion of loan premium		23,611			—
Change in fair value of embedded derivative liability		(995,701	)		(2,225,798	)
Change in fair value of warrant liability		(559,553	)		(6,054,121	)
Changes in operating assets and liabilities:
Other assets		(61,381	)		348,528
Accounts payable and accrued expenses		666,715			(936,778	)
Other liabilities		919,323			—
Net cash used in operating activities		(7,240,891	)		(2,403,168	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common stock		18,511,009			15,628,010
Payment of convertible debenture - related party		—			(1,821,818	)
Proceeds from convertible debenture - related party		—			436,000
Proceeds from note payable net of financing costs		14,609,915			—
Net cash provided by financing activities		33,120,924			14,242,192

Net increase in cash		25,880,033			11,839,024

Cash, beginning of period		4,511,642			37,195

Cash, end of period	$	30,391,675		$	11,876,219

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	146,128		$	22,180
Cash paid for taxes	$	—		$	—

SCHEDULE OF NON-CASH FINANCING ACTIVITIES:
Deemed dividends - related party	$	—		$	53,598,320

					Additional					Total Stockholders’
	Common Stock				Paid in		Accumulated			Equity
	Shares		Amount		Capital		Deficit			(Deficit)

Balance, June 30, 2020		5,204,392	$	520	$	19,538,742	$	(41,037,898	)	$	(21,498,636	)

Proceeds from issuance of common stock,net of cost of $2,371,790		1,799,980		180		15,627,830		—			15,628,010

Redemption of warrants - related party		1,549,750		155		13,132,230		—			13,132,385

Deemed dividend for purchase option - related party		5,359,832		536		53,597,784		(53,598,320	)		—

Cashless exercise of options		2,210		—		—		—			—

Net income		—		—		—		7,333,916			7,333,916

Balance, September 30, 2020		13,916,164		1,391		101,896,586		(87,302,302	)		14,595,675

Stock-based compensation		—		—		1,536,929		—			1,536,929

Net loss		—		—		—		(3,057,807	)

Balance, December 31, 2020		13,916,164	$	1,391	$	103,433,515	$	(90,360,109	)	$	13,074,797


Balance June, 30, 2021		22,333,324	$	2,232	$	229,933,505	$	(224,885,422	)	$	5,050,315

Proceeds from issuance of common stock, net cost of $2,224,992		2,592,000		259		18,510,750		—			18,511,009

Stock based compensation - restricted stock		37,049		3		286,756		—			286,759

Stock option based compensation		—		—		1,926,962		—			1,926,962

Net loss		—		—		—		(5,540,753	)		(5,540,753	)

Balance, September 30, 2021		24,962,373		2,494		250,657,973		(230,426,175	)		20,234,292

Stock based compensation - restricted stock		21,710		2		97,693		—			97,695

Stock option based compensation						1,147,422		—			1,147,422

Net Loss		—		—		—		(5,414,317	)		(5,414,317	)

Balance, December 31, 2021		24,984,083	$	2,496	$	251,903,088	$	(235,840,492	)	$	16,065,092

	December 31, 2021		December 31, 2020
	Number of Shares		Number of Shares
Stock Options		2,047,910		750,400
Warrants		519,763		214,665
Total		2,567,673		965,065

	December 31, 2021			June 30, 2021

Intellectual Property	$	2,293,770		$	2,293,770
Less Accumulated Amortization		(1,312,610	)		(1,197,921	)
Intellectual Property, Net	$	981,161		$	1,095,849


Year ending June 30, 2022 (Remaining six months)	$	114,689
2023		229,377
2024		229,377
2025		229,377
2026		178,341
Intellectual Property, Net	$	981,161

	December 31, 2021			June 30, 2021
Note Payable	$	15,000,000		$	—
Less debt financing costs	$	(375,900	)		—
Less unearned discount	$	(3,536,524	)		—
Plus accretion of loan premium		23,611			—
Note Payable, net of financing costs and premiums	$	11,111,187		$	—

	Unearned Discount		Debt Financing		Loan accretion Premium
Year ending June 30, 2022 (Remaining six months)	$	800,722	$	85,110	$	141,667
2023		1,601,445		170,219		283,333
2024		1,023,145		108,751		283,333
2025		111,212		11,820		118,056
Total	$	3,536,524	$	375,900	$	826,389


	Fair Value Measurements at
	December 31, 2021
	Level 1		Level 2		Level 3		Total

Derivative liability - Warrants	$	—	$	—	$	896,959	$	896,959
Derivative liability -Conversion option		—		—		1,217,765		1,217,765
Total derivatives	$	—	$	—	$	2,114,724	$	2,114,724

	Fair Value Measurements at
		June 30, 2021
		Level 1		Level 2		Level 3		Total

Derivative liability - Warrants	$	—	$	—	$	—	$	—
Derivative liability -Conversion option on convertible debenture		—		—		—		—
Total derivatives	$	—	$	—	$	—	$	—

	Derivative liabilities - Warrants			Derivative liability - Conversion Option on Convertible Debenture

Balance at July 1, 2021	$	—		$	—
Additions to level 3 liabilities		1,456,512			2,213,466
Change in in fair value of level 3 liability		(559,553	)		(995,701	)
Transfer in and/or out of Level 3		—			—
Balance at December 31, 2021	$	896,959		$	1,217,765

	Options			Weighted-Average Exercise Price			Weighted Remaining Average Contractual Term		Aggregate Intrinsic Value
Outstanding at June 30, 2021		755,200		$	4.34			4.4	$	2,569,232
Granted		1,365,835			7.74			5.0		—
Options Forfeited		(73,125	)		(13.91	)		—		—
Outstanding at December 31, 2021		2,047,910		$	9.79			4.4	$	15,840
Exercisable at December 31, 2021		509,667		$	9.36			4.2	$	15,840

	December 31, 2021			December 31, 2020
Expected life of options (In years)		5			5
Expected volatility		74.96	%		77.29	%
Risk free interest rate		0.8	%		0.4	%
Dividend Yield		0	%		0	%

Exercise Price		Outstanding		Weighted Average Contract Life		Exercisable
$	2.80		7,200		3.1		7,200
$	3.75		4,800		2.1		4,800
$	6.25		1,600		1.8		1,600
$	7.50		25,600		4.1		25,600
$	7.74		1,365,835		4.6		273,167
$	8.75		1,600		2.3		1,600
$	9.54		800		3.8		800
$	9.90		800		3.8		800
$	12.50		4,000		1.1		4,000
$	13.91		618,475		4.0		172,900
$	25.00		1,600		0.8		1,600
$	26.25		4,400		0.3		4,400
$	27.50		800		0.2		800
$	28.75		1,600		0.6		1,600
$	31.25		4,000		—		4,000
$	42.09		4,800		4.1		4,800
			2,047,910				509,667

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Life (Years)		Aggregate Intrinsic Value
Outstanding and exercisable at June 30, 2021		158,761	$	10.37		3.1	$	1,765,437
Granted		361,002	$	5.82		5.0	$	—
Exercised		—	$	—		—	$	—
Outstanding and exercisable at December 31, 2021		519,763	$	7.21		4.2	$	247,124

	Derivative liabilities - Warrants			Derivative liability - Conversion Option on Convertible Debenture

Beginning balance at July 1, 2020	$	16,411,504		$	5,000,800
Additions to level 3 liabilities		—			—
Change in in fair value of level 3 liability		(6,054,121	)		(2,225,798	)
Transfer in and/or out of Level 3		(10,357,383	)		(2,775,002	)
Balance at December 31, 2020	$	—		$	—

Exhibit
10.1		Loan and Security Agreement, dated November 30, 2021, among BioVie Inc. Avenue Venture Opportunities Fund II, L.P., and Avenue Venture Opportunities Fund, L.P. (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No. 001-39015) filed on December 1, 2021).
10.2		Supplement to Loan and Security Agreement, dated November 30, 2021, among BioVie Inc., Avenue Venture Opportunities Fund II, L.P. and Avenue Venture Opportunities Fund, L.P. (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K (File No. 001-39015) filed on December 1, 2021)
10.3		Form of Warrant to Purchase Shares of Class A Common Stock of BioVie Inc. (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K (File No. 001-39015) filed on December 1, 2021)
31.1*		Certification of Chief Executive Officer (Principal Executive Officer) required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.
31.2*		Certification of Chief Financial Officer (Principal Financial Officer) required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.
32.1**		Certifications of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of Chief Financial Officer (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.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

*	Filed herewith.

**	Furnished herewith. This certification is being furnished solely to accompany this report pursuant to 18 U.S.C. Section 1350, and is not being filed for purposes of Section 18 of the Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filings of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


Signature	Titles	Date

/s/ Cuong V Do
Cuong V Do	Chairman and Chief Executive Officer (Principal Executive Officer)	February 7, 2022

/s/ Joanne Wendy Kim
Joanne Wendy Kim	Chief Financial Officer (Principal Financial and Accounting Officer)	February 7, 2022

SEC Form 10-Q filed by BioVie Inc.