Form 10-Q BioCardia, Inc. For: Jun 30

 

 

 

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

BIOCARDIA, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share amounts)

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

 

BIOCARDIA, INC.

Condensed Consolidated Statements of Operations

(In thousands, except share and per share amounts)

(unaudited)

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

 

BIOCARDIA, INC.

Condensed Consolidated Statements of Stockholders’ Equity

(In thousands, except share amounts)

(unaudited)

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

 

BIOCARDIA, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(unaudited)

 

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

 

BioCardia, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

 

(1)	Summary of Business and Basis of Presentation

 

	(a)	Description of Business
		BioCardia, Inc. (we, us, our, BioCardia or the Company), is a clinical-stage company focused on developing cellular and cell-derived therapeutics for the treatment of cardiovascular and pulmonary diseases with significant unmet medical needs. The Company’s lead therapeutic candidates are based on the CardiAMP Cell Therapy System, a platform which provides an autologous bone marrow derived cell therapy for treatment in two clinical indications: ischemic heart failure and refractory angina resulting from chronic myocardial ischemia. The Company’s second therapeutic platform is an investigational bone marrow derived allogeneic “off the shelf” Neurokinin-1 Receptor Positive mesenchymal stem cell therapy for the treatment of cardiac and pulmonary disease. To date, we have devoted substantially all our resources to research and development efforts relating to our therapeutic candidates and biotherapeutic delivery systems including conducting clinical trials, developing manufacturing and sales capabilities, in-licensing related intellectual property, providing general and administrative support for these operations and protecting our intellectual property.
		BioCardia also has three enabling device product lines: (1) the CardiAMP cell processing system; (2) the Helix biotherapeutic delivery system, or Helix; and (3) the Morph vascular access product line, or Morph. We manage our operations as a single segment for the purposes of assessing performance and making operating decisions.

 

 

(2)	Significant Accounting Policies

 

(a)	Basis of Preparation
		The accompanying condensed consolidated balance sheets, statements of operations, stockholders’ equity, and cash flows as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 are unaudited. The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information and on a basis consistent with the annual financial statements and, in the opinion of management, reflect all adjustments which include only normal recurring adjustments, necessary to present fairly its financial position as of June 30, 2022, results of operations for the three and six months ended June 30, 2022 and 2021, and cash flows for the six months ended June 30, 2022 and 2021. The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ended December 31, 2022 or for any other interim period or for any other future year.   These condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 29, 2022.

 

	(b)	Liquidity – Going Concern
		We have incurred net losses and negative cash flows from operations since our inception and had an accumulated deficit of approximately $134.5 million as of June 30, 2022. Management expects operating losses and negative cash flows to continue through at least the next several years. We expect to incur increasing costs as we advance our trials and development activities. Therefore, absent additional funding, management believes cash and cash equivalents of $8.6 million as of June 30, 2022 are not sufficient to fund the Company’s planned expenditures and meet its obligations beyond the first quarter of 2023. These factors raise substantial doubt about the Company’s ability to continue as a going concern beyond one year from the date these financial statements are issued. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.   The Company’s ability to continue as a going concern and to continue further development of its therapeutic candidates beyond the first quarter of 2023, will require the Company to raise additional capital. The Company plans to raise additional capital, potentially including debt and equity arrangements, to finance its future operations. While management believes this plan to raise additional funds will alleviate the conditions that raise substantial doubt, these plans are not entirely within its control and cannot be assessed as being probable of occurring. If adequate funds are not available, we may be required to reduce operating expenses, delay or reduce the scope of our product development programs, obtain funds through arrangements with others that may require us to relinquish rights to certain of our technologies or products that we would otherwise seek to develop or commercialize, or cease operations.

 

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	(c)	Use of Estimates
		The preparation of the financial statements in accordance with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. Significant items subject to such estimates and assumptions include share-based compensation, the useful lives of property and equipment, right-of-use assets and related liabilities, incremental borrowing rate, allowances for doubtful accounts and sales returns, clinical accruals and assumptions used for revenue recognition.

 

	(d)	Principles of Consolidation
		The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, BioCardia Lifesciences, Inc. All intercompany accounts and transactions have been eliminated during the consolidation process.

 

(e)	Changes to Significant Accounting Policies
		The Company’s significant accounting policies are described in Note 2 of the notes to the consolidated financial statements included in its Annual Report on Form 10-K filed March 29, 2022 for the year ended December 31, 2021. There have been no changes to those policies.

 

	(f)	Recent Accounting Pronouncements
		Recent accounting pronouncements issued by the Financial Accounting Standards Board (FASB), including its Emerging Issues Task Force did not or are not believed by management to have a material impact on our financial statement presentation or disclosures.

 

 

(3)	Fair Value Measurement

 

The fair value of financial instruments reflects the amounts that we estimate to receive in connection with the sale of an asset or paid in connection with the transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). We follow a fair value hierarchy that prioritizes the use of inputs used in valuation techniques into the following three levels:

 

Level 1 – quoted prices in active markets for identical assets and liabilities.

 

Level 2 – observable inputs other than quoted prices in active markets for identical assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

 

Level 3 – unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

 

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The following table sets forth the fair value of its financial assets measured on a recurring basis as of June 30, 2022 and December 31, 2021 and indicates the fair value hierarchy utilized to determine such fair value (in thousands):

 

		As of June 30, 2022
		Level 1				Level 2				Level 3				Total
Assets:
Money market funds		$	8,519			$	—			$	—			$	8,519
Cash in checking account			—				—				—				95
Total cash and cash equivalents		$	8,519			$	—			$	—			$	8,614

 

		As of December 31, 2021
		Level 1				Level 2				Level 3				Total
Assets:
Money market funds		$	12,917			$	—			$	—			$	12,917
Cash in checking account			—				—				—				(45	)
Total cash and cash equivalents		$	12,917			$	—			$	—			$	12,872

 

 

(4)	Property and Equipment, Net

 

Property and equipment, net consisted of the following (in thousands):

 

		June 30,				December 31,
		2022				2021
Computer equipment and software		$	142			$	133
Laboratory and manufacturing equipment			496				460
Furniture and fixtures			27				26
Leasehold improvements			26				26
Construction in progress			82				74
Property and equipment, gross			773				719
Less accumulated depreciation			(569	)			(537	)
Property and equipment, net		$	204			$	182

 

Depreciation expense totaled $16,000 and $32,000 for the three and six months ended June 30, 2022, respectively. Depreciation expense totaled $16,000 and $30,000 for the three and six months ended June 30, 2021, respectively.

  

(5)	Operating Lease Right-of-Use Asset, Net

 

Our operating lease related to a property lease for our laboratory and corporate offices expired in December 2021, and we entered into a new lease which expires in January 2027, with an option for us to extend a further 36 months after expiration. Our lease agreements do not contain any material residual guarantees or material restrictive covenants. We determine if an arrangement is a lease at inception by assessing whether it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

 

Right-of-use (ROU) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The Company’s lease does not provide an implicit rate. We used an adjusted historical incremental borrowing rate, based on the information available at the approximate lease commencement date, to determine the present value of lease payments. Variable rent expense is made up of expenses for common area maintenance and shared utilities and were not included in the determination of the present value of lease payments. We have no finance leases.

 

Our lease expense for the three and six months ended June 30, 2022 was $120,000 and $241,000, respectively. Our lease expense for the three and six months ended June 30, 2021 was $150,000 and $301,000, respectively. The cash paid under the operating lease for base rent for the three and six months ended June 30, 2022 was $76,000 and $173,000, respectively. The cash paid under the operating lease during the three and six months ended June 30, 2021 was $162,000 and $324,000, respectively. On June 30, 2022, the weighted average remaining lease term was 4.59 years, and the weighted average discount rate was 10.74%.

 

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Future minimum lease payments under the operating lease as of June 30, 2022 are as follows (in thousands):

 

Remainder of 2022		$	229
2023			471
2024			485
2025			499
2026			514
2027			44
Total undiscounted lease payments		$	2,242
Less imputed interest			472
Total operating lease liabilities		$	1,770

 

 

(6)	Accrued Expenses and Other Current Liabilities

 

Accrued expenses and other current liabilities consisted of the following (in thousands):

 

		June 30,				December 31,
		2022				2021
Accrued expenses		$	29			$	240
Accrued salaries and employee benefits			734				861
Accrued clinical trial costs			301				334
Grant liability			562				590
Customer deposits			90				96
Payable to related party			47				—
Total		$	1,763			$	2,121

 

 

(7)	Stockholders’ Equity

 

Warrants - Set forth below is a table of activity of warrants for common stock and the related weighted average exercise price per warrant.

 

		Number of				Weighted
		Common Stock				Average
		Warrants				Exercise Price
Balance as of December 31, 2021			2,424,724			$	6.36
Warrants for common stock sold			—				—
Warrants for common stock exercised			—				—
Balance as of June 30, 2022			2,424,724			$	6.36

 

Lincoln Park Capital stock purchase agreement - On March 29, 2021, the Company and Lincoln Park Capital Fund, LLC (Lincoln Park) entered into a purchase agreement (the Purchase Agreement) and a registration rights agreement (the Registration Rights Agreement), pursuant to which the Company has the right to sell to Lincoln Park shares of the Company’s common stock having an aggregate value of up to $20 million, subject to certain limitations and conditions set forth in the Purchase Agreement (the Offering). As consideration for entering into the Purchase Agreement, the Company agreed to issue to Lincoln Park 75,000 shares of common stock as commitment shares. In addition, the Company agreed to issue to Lincoln Park up to an aggregate of 50,000 additional shares of common stock as a further commitment fee based on a pro-rata percentage of the $20 million of common stock issued to Lincoln Park under the Purchase Agreement.

 

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Pursuant to the Purchase Agreement, Lincoln Park purchased 373,832 shares of common stock, at a price of $5.35 per share, for a total gross purchase price of $2 million (the Initial Purchase) and the Company issued 80,000 shares of common stock as commitment shares, which included 5,000 commitment shares issued on a pro rata basis for the initial $2 million purchase. Thereafter, as often as every business day from and after one business day following the date of the Initial Purchase and over the 36-month term of the Purchase Agreement the Company has the right, from time to time, at its sole discretion and subject to certain conditions, to direct Lincoln Park to purchase up to 100,000 shares of common stock, with such amount increasing as the closing price of the common stock increases; provided Lincoln Park’s obligation under any single such purchase will not exceed $2 million, unless the Company and Lincoln Park mutually agree to increase the maximum amount of such single purchase (each, a Regular Purchase). If the Company directs Lincoln Park to purchase the maximum number of shares of common stock it then may sell in a Regular Purchase, then in addition to such Regular Purchase, and subject to certain conditions and limitations in the Purchase Agreement, the Company may direct Lincoln Park in an Accelerated Purchase to purchase an additional amount of common stock that may not exceed the lesser of (i) 300% of the number of shares purchased pursuant to the corresponding Regular Purchase in multiple Accelerated Purchases on the same trading day or (ii) 30% of the total number of shares of the Company’s common stock traded during a specified period on the applicable purchase date as set forth in the Purchase Agreement. Under certain circumstances and in accordance with the Purchase Agreement, the Company may direct Lincoln Park to purchase shares in multiple Accelerated Purchases on the same trading day.

 

The Company controls the timing and amount of any sales of its common stock to Lincoln Park. There is no upper limit on the price per share that Lincoln Park must pay for its common stock under the Purchase Agreement. In no event may the Company issue or sell to Lincoln Park under the Purchase Agreement shares of the Company’s common stock in excess of 3,266,177 shares (including the commitment shares), which represents 19.99% of the shares of our common stock outstanding immediately prior to the execution of the Purchase Agreement (the Exchange Cap), unless (i) the Company obtains stockholder approval to issue shares of its common stock in excess of the Exchange Cap or (ii) the average price of all applicable sales of the Company’s common stock to Lincoln Park under the Purchase Agreement equals or exceeds $4.2736 per share. In all instances, the Company may not sell shares of its common stock to Lincoln Park under the purchase agreement if it would result in Lincoln Park beneficially owning more than 9.99% of its common stock.

 

The Purchase Agreement does not limit the Company’s ability to raise capital from other sources at the Company’s sole discretion, except that during the 36 months after the date of the Purchase Agreement (subject to certain exceptions) the Company may not enter into any agreement to effect the issuance of its common stock or common stock equivalents in any “equity line of credit” or other similar continuous offering in which the Company may offer, issue or sell common stock or common stock equivalents at a future determined price, other than in connection with common stock issued pursuant to an “at-the-market offering” by the Company exclusively through a registered broker-dealer acting as agent of the Company pursuant to a written agreement between the Company and the registered broker-dealer. The Company has the right to terminate the Purchase Agreement at any time, at no cost to the Company.

 

As of June 30, 2022, the Company had not sold any common stock to Lincoln Park under the Purchase Agreement other than the Initial Purchase.

 

Cantor Fitzgerald Sales agreement - On April 12, 2022, the Company entered into a sales agreement (the Sales Agreement) with Cantor Fitzgerald & Co. (Cantor) as the sales agent, pursuant to which the Company may offer and sell, from time to time, through Cantor, shares of its common stock having an aggregate offering price of up to $10.5 million (the ATM Offering). The Company is not obligated to sell any common stock shares pursuant to the Sales Agreement. Under the terms of the Sales Agreement, the Company will pay Cantor a commission of 3% of the aggregate proceeds from the sale of shares and reimburse certain legal fees. In April 2022, the Company sold 575,000 shares of common stock under the ATM Offering at then-market prices for total gross proceeds of approximately $1.5 million, with associated issuance costs of $232,000.

 

(8)	Share-Based Compensation

 

The share-based compensation expense is recorded in research and development, and selling, general and administrative expenses based on the employee's or non-employee’s respective function. No share-based compensation was capitalized during the periods presented. Share-based compensation expense for the three and six months ended June 30, 2022 and 2021 was recorded as follows (in thousands):

 

		Three months ended								Six months ended
		June 30,								June 30,
		2022				2021				2022				2021
Research and development		$	130			$	211			$	257			$	417
Selling, general and administrative			174				173				366				383
Total share-based compensation		$	304			$	384			$	623			$	800

 

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The following table summarizes the activity of stock options and related information:

 

		Options outstanding
		Number of shares				Weighted average exercise price				Weighted average remaining contractual term (years)				Aggregate intrinsic value (in thousands)
Balance, December 31, 2021			1,649,686			$	5.00				7.6			$	—
Stock options granted			504,949				1.53
Stock options exercised			—
Stock options forfeited			(90,688	)			3.68
Stock options expired			(3,111	)			9.55
Balance, June 30, 2022			2,060,836			$	4.20				7.9			$	—
Exercisable, June 30, 2022			955,545			$	5.99				6.5			$	—

 

Unrecognized share-based compensation for employee and nonemployee options granted through June 30, 2022 is approximately $2.5 million to be recognized over a remaining weighted average service period of 2.8 years.

 

Share-Based Compensation (RSUs)

 

The following summarizes the activity of non-vested RSUs:

 

						Weighted
						average
						grant date
		Number of				fair value
		shares				per share
Balance, December 31, 2021			200,271			$	4.13
RSUs granted			269,204				1.49
RSUs released			(311,929	)			2.74
RSUs forfeited			(87,718	)			1.49
Balance, June 30, 2022			69,828			$	3.44

 

RSUs vested and settled are converted into the Company’s common stock on a one-for-one basis. RSUs are generally subject to forfeiture if employment terminates prior to the release of vesting restrictions. Of the 69,828 RSUs outstanding on June 30, 2022, 67,094 RSUs are vested and have not been settled and 2,734 have not yet vested. The related compensation expense, which is based on the grant date fair value of the Company’s common stock multiplied by the number of units granted, is recognized ratably over the period during which the vesting restrictions lapse. Unrecognized share-based compensation for employee and nonemployee RSUs granted through June 30, 2022 is approximately $55,000 to be recognized over a remaining weighted average service period of 0.2 years.

 

(9)	Net Loss per Share

 

Basic net loss per share is calculated by dividing the net loss by the weighted average number of shares of common stock outstanding and fully vested restricted stock units. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period determined using the treasury-stock method. Common stock equivalents are comprised of unvested restricted stock units, warrants to purchase common stock and options outstanding under the stock option plans. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding since the effects of potentially dilutive securities are antidilutive due to the net loss position.

 

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The following outstanding common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: 

 

		June 30,
		2022				2021
Stock options to purchase common stock			2,060,836				1,685,059
Unvested restricted stock units			2,734				5,468
Common stock warrants			2,424,724				2,424,724
Total			4,488,294				4,115,251

 

(10)	Income Taxes

 

During the three and six months ended June 30, 2022 and 2021, there was no income tax expense or benefit for federal or state income taxes in the accompanying condensed consolidated statements of operations due to the Company’s net loss and a full valuation allowance on the resulting deferred tax assets.

 

As of June 30, 2022, the Company retains a full valuation allowance on its deferred tax assets in all jurisdictions. The realization of its deferred tax assets depends primarily on its ability to generate future taxable income which is uncertain. The Company does not believe that its deferred tax assets are realizable on a more-likely-than-not basis; therefore, the net deferred tax assets have been fully offset by a valuation allowance.   

 

(11)	Related Party Transactions

 

On April 9, 2020, the Company entered into a Litigation Funding Agreement (the Funding Agreement) with BSLF, L.L.C. (the Funder), an entity owned and controlled by Andrew Blank, Chair of BioCardia’s board of directors, for the purpose of funding the Company’s legal proceedings and any and all claims, actions and/or proceedings relating to or arising from the case captioned Boston Scientific Corp., et al., v. BioCardia Inc., Case No. 3:19-05645-VC, U.S.D.C., N. D. Cal (the Litigation). On April 12, 2021, all parties to the Litigation entered into a confidential settlement agreement and all claims were dismissed.

 

In March 2022, the Company entered into settlement agreements with its litigation service providers and the Funder to terminate the Funding Agreement and conclude on all remaining matters thereunder (the Litigation Funding Settlement). Under the terms of the confidential agreements, litigation and corporate counsel provided credits and refunds of legal fees totaling $688,000, which offset the amounts owed to the Company by the Funder under the Funding Agreement, and provided up to $300,000 in future discounts on legal services. As a result of the Litigation Funding Settlement, the Company will remit the discounts, as received, to the Funder on a quarterly basis. As a result of the settlement, accounts payable was reduced by $523,000, the $562,000 receivable due from the related party was eliminated, and a $156,000 related party payable was included in accrued expenses and other current liabilities as of December 31, 2021. The Company remitted the $156,000 related party payable to the Funder on March 17, 2022. During the three and six months ended June 30, 2022, the Company received discounts totaling $43,000 and $47,000, respectively, with the total $47,000 recorded as a related party payable in accrued expenses and other current liabilities as of June 30, 2022.

 

(12)	Contingencies and Uncertainties

 

Contingencies - The Company may be subject to various claims, complaints, and legal actions that arise from time to time in the normal course of business. Management is not aware of any current legal or administrative proceedings that are likely to have an adverse effect on the Company’s business, financial position, results of operations, or cash flows.

 

Uncertainties - The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other interim period or for any other future year, particularly in light of the novel coronavirus pandemic, or COVID-19, and its impact on domestic and global economies. While the impact of the COVID-19 pandemic did not have a material adverse effect on our financial position or results of operations for the periods presented, the governmental actions and similar actions that may be enacted in the future, and the widespread economic disruption arising from the pandemic, have the potential to materially impact our business and influence our business decisions. The extent and duration of the pandemic is unknown, and the future effects on our business are uncertain and difficult to predict. The Company is continuing to monitor the events and circumstances surrounding the COVID-19 pandemic, which may require adjustments to the Company’s estimates and assumptions in the future.

 

 

ITEM 2.   MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                                                   

 

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. This discussion contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any and all statements contained in this Quarterly Report that are not statements of historical fact may be deemed forward-looking statements. Terms such as “may,” “might,” “would,” “should,” “could,” “project,” “estimate,” “pro-forma,” “predict,” “potential,” “strategy,” “anticipate,” “attempt,” “develop,” “plan,” “help,” “believe,” “continue,” “intend,” “expect,” “future” and terms of similar import (including the negative of any of the foregoing) may be intended to identify forward-looking statements. However, not all forward-looking statements may contain one or more of these identifying terms. Forward-looking statements in this Quarterly Report may include, without limitation, statements regarding (i) the plans and objectives of management for future operations, including plans or objectives relating to the development of our cell therapy systems and our clinical trials, (ii) a projection of income (including income/loss), earnings (including earnings/loss) per share, capital expenditures, dividends, capital structure or other financial items, (iii) our ability to raise additional capital, (iv) our future financial performance, including any such statement contained in a discussion and analysis of financial condition by management or in the results of operations included pursuant to the rules and regulations of the SEC and (vi) the assumptions underlying or relating to any statement described in points (i) – (iv) above. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and elsewhere in this Quarterly Report on Form 10-Q, those listed in our Annual Report on Form 10-K for the year ended December 31, 2021. Historical results are not necessarily indicative of future results. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q to conform these statements to actual results or to changes in our expectations.    

 

Overview

 

We are a clinical-stage company focused on developing cellular and cell-derived therapeutics for cardiovascular and pulmonary diseases with large unmet medical needs. We are committed to applying our expertise in the fields of autologous and allogeneic cell-based therapies to improve the lives of patients with cardiovascular and pulmonary conditions. Our CardiAMP cell therapy platform provides an autologous bone marrow derived cell therapy (using a patient’s own cells) for the treatment of two clinical indications: heart failure that develops after a heart attack (BCDA-01) and chronic myocardial ischemia (BCDA-02). Our allogeneic mesenchymal stem cell therapy platform, derived from donor cells and intended to be provided “off the shelf,” is also being advanced for two indications, heart failure (BCDA-03) and for the pulmonary indication of acute respiratory distress that has developed from COVID-19 (BCDA-04).

 

Our Helix™ Biotherapeutic Delivery System platform, or Helix, delivers therapeutics into the heart muscle with a helical needle from within the heart. It enables local delivery of cell, gene and protein-based therapies, including our own cell therapies to treat cardiac indications. The Helix system is CE marked in Europe and under investigational use in the United States. We selectively partner with firms developing other cell, gene and protein therapies utilizing the Helix and other biotherapeutic delivery systems that we have developed.  

 

Our AVANCE™ product offering for transseptal cardiac procedures has begun early commercialization activities in the United States through commission-only 1099 sales representatives. 

 

CardiAMP Cell Therapy for Heart Failure and Chronic Myocardial Ischemia

 

The Company’s lead platform, CardiAMP cell therapy, is an autologous cell therapy being advanced for two indications in pivotal clinical trials: heart failure and chronic myocardial ischemia.

 

The CardiAMP Heart Failure Trial is a Phase III, multi-center, randomized, double-blinded, sham-controlled study of up to 260 patients at 40 centers nationwide, which includes a 10-patient roll-in cohort. The Phase III pivotal trial is designed to provide the primary support for the safety and efficacy of the CardiAMP Cell Therapy System for heart failure which develops after a patient has a heart attack (BCDA-01). The trial is active at 26 clinical sites and 114 patients have been enrolled to date, with 10 additional control patients having crossed over to receive therapy.

 

In January 2022, the U.S. Food and Drug Administration (FDA) granted Breakthrough Device Designation for the CardiAMP Cell Therapy System for the treatment of heart failure. This Breakthrough Device Program is designed to expedite FDA approval of certain novel devices or device-led combination products (i.e., products that combine drugs, devices or biological products) that have the potential to provide more effective treatment or diagnosis of life-threatening or irreversibly debilitating diseases or conditions. It is believed that the CardiAMP Cell Therapy System is the first cardiac cell therapy to receive an FDA Breakthrough designation.   

 

 

In February 2022, the independent Data Safety Monitoring Board (DSMB) completed a prespecified data review, including a risk-benefit assessment. Following the review, the DSMB indicated that it had no significant safety concerns and recommended that the study continue as designed. The next prespecified formal DSMB review is scheduled for August 30, 2022, which will assess both safety and futility of the trial. The results from this review should be made available in the days following the review.

 

In February 2022, Health Canada, the country’s health services agency, sent BioCardia a No Objection Letter, allowing the CardiAMP Heart Failure Trial to expand into Canada. Four world-class Canadian clinical sites are currently working through the activation process to begin enrolling patients in the near future. The first of these four new Canadian sites, the Ottawa Heart Institute is now actively enrolling in the trial.

 

Enrollment in the CardiAMP Heart Failure Trial remains our primary focus. We expect enrollment to improve in the months ahead due to:

	●	reduced impact of COVID-19;
	●	FDA’s January 2022 grant of the Breakthrough Device Designation for the CardiAMP Cell Therapy;
	●	Health Canada’s February 2022 issuance of a No Objection Letter, allowing expansion of the study to Canadian sites;
	●	CMS’s March 2022 issuance of procedure code C9782, which applies to both of our CardiAMP Cell Therapy clinical trials;
	●	CMS’s May 2022 retroactive payment increase for procedure code C9782;
	●	our active efforts to include patients whose insurance does not cover the study;
	●	our previously obtained FDA authorization to provide therapy for patients in the control arm of the trial that otherwise would not receive therapy after the two-year follow-up, and
	●	enhanced outreach to sites and increased clinical marketing activities.

 

The Company is actively pursuing approval for the CardiAMP Cell Therapy System for the treatment of ischemic heart failure in Japan and had its second consultation with Japan’s Pharmaceutical and Medical Device Agency (PMDA) on July 15, 2022.

 

The CardiAMP Chronic Myocardial Ischemia Trial is a Phase III, multi-center, randomized, double-blinded, controlled study of up to 343 patients at up to 40 clinical sites. The Phase III pivotal trial is designed to provide the primary support for the safety and efficacy of the CardiAMP Cell Therapy System for the indication of chronic myocardial ischemia (BCDA-02). This therapeutic approach uses many of the same novel aspects as the CardiAMP Heart Failure Trial and is expected to leverage our experience and investment in the heart failure trial. The trial has been activated and one patient has been treated. 

 

The Department of Health & Human Services Centers for Medicare & Medicaid Services, or CMS, has designated that both CardiAMP pivotal trials qualify for Medicare national coverage. The covered costs under Medicare include patient screening, the CardiAMP Cell Therapy System and procedure, and clinical follow-up at one and two years after the procedure. Private insurance plans covering 50 million insured Americans follow the CMS reimbursement policy and are similarly anticipated to cover these costs. This coverage significantly reduces our cost of conducting these pivotal trials. In May of 2022, the United States Center for Medicare and Medicaid Services (CMS) updated our recently issued reimbursement code (designated C9782) for the CardiAMP Cell Therapy procedures. The code is for a "blinded procedure for New York Heart Association (NYHA) Class II or III heart failure, or Canadian Cardiovascular Society (CCS) Class III or IV chronic refractory angina; transcatheter intramyocardial transplantation of autologous bone marrow cells (e.g., mononuclear) or placebo control, autologous bone marrow harvesting and preparation for transplantation, left heart catheterization including ventriculography, all laboratory services, and all imaging with or without guidance (e.g., transthoracic echocardiography, ultrasound, fluoroscopy), all device(s), performed in an approved Investigational Device Exemption (IDE) study.” They also assigned the code to an Ambulatory Payment Code level of up to $20,000.

 

This new CMS code and reimbursement level is available to submitting hospitals performing the CardiAMP cell therapy procedure beginning on April 1, 2022, enabling clear reimbursement for the study procedure for both the treatment and control arms of both pivotal cell therapy trials.

 

ALLOGENEIC Cell Therapy for Cardiac and Pulmonary Disease (BCDA-03 and BCDA-04)

 

Our second therapeutic platform is our investigational culture expanded bone marrow derived allogeneic, Neurokinin-1 Receptor Positive mesenchymal stem cells (NK1R+ MSC). This “off the shelf” mesenchymal cell therapy is being advanced for cardiac and pulmonary disease.  BioCardia’s established and certified ISO 7 cleanroom has been developed to manufacture its allogeneic NK1R+MSC investigational cell therapy products.

 

We are working to secure FDA acceptance of an IND application for a Phase I/II trial to deliver these allogeneic cells for the treatment of ischemic systolic heart failure. We have completed the manufacturing validation runs and stability testing for the Chemistry Manufacturing and Controls section of the IND and preclinical pharmacology toxicology animal testing was initiated. These animal studies have been completed and we are awaiting formal results. Should the results be in line with our previous results, we expect to submit the IND application promptly thereafter.

 

 

In April 2022, the FDA approved the Company’s Investigational New Drug (IND) for a Phase I/II trial for the use of this allogeneic cell therapy for ARDS caused by COVID-19 (BCDA-04). This allows the Company to initiate its First-in-Human Phase I/II trial in adult patients recovering from Acute Respiratory Distress Syndrome (ARDS) due to COVID-19, with trial initiation expected in 2022. The first part of the clinical trial will evaluate increasing dosages of the NK1R+ MSCs and the optimal dose will be taken to Phase II in a randomized study in adult patients recovering from ARDS due to COVID-19. This therapy is intended to address the enormous unmet need of sustained local and systemic inflammation after a patient is taken off respirator support with goals of accelerating recovery, enhancing survival and reducing both relapse and rehospitalization.

 

Recent Developments

 

COVID-19 Update

 

As a result of the COVID-19 pandemic, we have experienced significant disruption to the Company’s business and delays in the Company’s development programs and regulatory and commercialization timelines, including adverse impact to our operations at certain clinical sites involved in our ongoing clinical studies. The COVID-19 pandemic could continue to adversely affect our business, results of operations, financial condition and/or liquidity in the future. These adverse impacts could include delayed or slowed enrollment of our, or our collaborators’, planned or ongoing clinical trials, delayed or cancelled clinical site initiations, delayed regulatory review for regulatory approvals, delayed commercialization of one or more of our product candidates, if approved, and workforce shortages. Our production capabilities, or those of our partners or suppliers, and our supply chains could also be adversely impacted.

 

Additionally, while the potential continuing economic impact brought by, and the duration of, the COVID-19 pandemic is difficult to assess or predict, the impact of COVID-19 on the global financial markets may reduce the Company’s ability to access capital, which could negatively impact the Company’s liquidity and ability to raise the capital to complete its preclinical and clinical studies on a timely basis, or at all. In addition, a recession, market correction or depression resulting from the COVID-19 pandemic or the response to it, could materially affect our business and the value of our common stock.

 

Financial Overview

 

Revenue

 

We currently have a portfolio of enabling and delivery products, from which we have generated modest revenue. Net product revenues include commercial sales of our Morph vascular access system in the US and EU and collaboration agreement revenues include revenue from partnering agreements with corporate and academic institutions. Under these partnering agreements, we provide our Helix biotherapeutic delivery system and customer training and support for use in preclinical and clinical studies.

 

Research and Development Expenses

 

Our research and development expenses consist primarily of:

 

	•	salaries and related overhead expenses, which include share-based compensation and benefits for personnel in research and development functions;
	•	fees paid to consultants and contract research organizations, or CROs, including in connection with our preclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial management and statistical compilation and analysis;
	•	costs related to acquiring and manufacturing clinical trial materials;
	•	costs related to compliance with regulatory requirements; and
	•	payments related to licensed products and technologies.

 

We expense all research and development costs in the periods in which they are incurred. Costs for certain development activities are recognized based on an evaluation of the progress of completion of specific tasks using information and data provided to us by our vendors and clinical sites. Nonrefundable advance payments for goods or services to be received in future periods for use in research and development activities are deferred and capitalized. The capitalized amounts are then expensed as the related goods are delivered and the services are received. 

 

 

We plan to increase our research and development expenses for the foreseeable future as we continue the pivotal CardiAMP Heart Failure Trial, advance the pivotal CardiAMP Chronic Myocardial Ischemia Trial, and further develop our autologous and allogeneic cell therapy candidates. We typically use our employee and infrastructure resources across multiple research and development programs, and accordingly, we have not historically allocated resources specifically to our individual programs.

 

Selling, General and Administrative Expenses

 

Selling, general and administrative expenses consist primarily of salaries and related costs for employees in executive, finance and administration, sales, corporate development and administrative support functions, including share-based compensation expenses and benefits. Other selling, general and administrative expenses include sales commissions, rent, accounting and legal services, obtaining and maintaining patents, the cost of consultants, occupancy costs, insurance premiums and information systems costs.

 

Other Income (Expense)

 

Other income and expense consist primarily of interest income we earn on our cash and cash equivalents. 

 

Critical Accounting Policies and Estimates

 

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with U.S. GAAP. The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various judgements that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not clear from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

The full extent to which the ongoing COVID-19 pandemic will directly or indirectly impact our business, results of operations and financial condition, including revenues, expenses, reserves and allowances, manufacturing, clinical trials and research and development will depend on future developments that continue to remain highly uncertain at this time. As events continue to evolve and additional information becomes available, our estimates may change materially in future periods.

 

We define our critical accounting policies as those that require us to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles. Our critical accounting policies are described in Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2021. 

 

Results of Operations

 

Comparison of Three and Six Months Ended June 30, 2022 and 2021

 

The following table summarizes our results of operations for the three and six months ended June 30, 2022 and 2021 (in thousands): 

 

		Three months ended June 30,								Six months ended June 30,
		2022				2021				2022				2021
Revenue:
Net product revenue		$	—			$	—			$	1			$	—
Collaboration agreement revenue			974				69				1,033				115
Total revenue			974				69				1,034				115
Costs and expenses:
Research and development			2,304				2,362				4,490				4,203
Selling, general and administrative			1,166				1,196				2,367				2,373
Total costs and expenses			3,470				3,558				6,857				6,576
Operating loss			(2,496	)			(3,489	)			(5,823	)			(6,461	)
Other income (expense):
Total other income (expense), net			(1	)			2				1				5
Net loss		$	(2,497	)		$	(3,487	)		$	(5,822	)		$	(6,456	)

 

Revenue.   Revenue increased to $974,000 in the second quarter of 2022 as compared to $69,000 in the second quarter of 2021, and from $1,033,000 in the six months ended June 30, 2022 as compared to $115,000 in the six months ended June 30, 2021, primarily due to fulfilment of deliverables and completion of collaborative agreements due to the passage of time. The Company’s performance obligations were deemed to be fulfilled, and thus revenues were recognized. The amount and timing of collaboration revenues is largely dependent on our partners’ development activities and may be inconsistent and create significant quarter-to- quarter variation in our revenues.

 

 

Research and Development Expenses.  Research and development expenses decreased to $2,304,000 in the second quarter of 2022 as compared to $2,362,000 in the second quarter of 2021. Research and development expenses increased to $4,490,000 in the six months ended June 30, 2022 as compared to $4,203,000 in the six months ended June 30, 2021 primarily due increasing expenses in support of the CardiAMP Heart Failure Trial.  

 

Selling, General and Administrative Expenses.  Selling, general and administrative expenses decreased to $1,166,000 in the second quarter of 2022 as compared to $1,196,000 in the second quarter of 2021. Selling, general and administrative expenses decreased to $2,367,000 in the six months ended June 30, 2022 as compared to $2,373,000 in the six months ended June 30, 2021.

 

Liquidity and Capital Resources

 

We have incurred net losses each year since our inception and as of June 30, 2022, we had an accumulated deficit of approximately $134.5 million. We anticipate that we will continue to incur net losses for the next several years.

 

We have funded our operations principally through the sales of equity and convertible debt securities. As of June 30, 2022, we had cash and cash equivalents of approximately $8.6 million. 

 

The following table shows a summary of our cash flows for the periods indicated (in thousands): 

 

		Six months ended June 30,
		2022				2021
Net cash provided by (used in):
Operating activities		$	(5,558	)		$	(4,748	)
Investing activities			(54	)			(55	)
Financing activities			1,354				1,939
Net decrease in cash and cash equivalents		$	(4,258	)		$	(2,864	)

 

Cash Flows from Operating Activities. The increase in overall spending for operating activities of approximately $0.8 million in the six months ended June 30, 2022 compared to the six months ended June 30, 2021 related primarily to the timing of payments from collaboration partners.

 

Cash Flows from Investing Activities. Net cash used in investing activities of $54,000 and $55,000 during the six months ended June 30, 2022 and 2021 respectively, consisted of purchases of property and equipment, primarily lab and office equipment.

 

Cash Flows from Financing Activities. Net cash provided by financing activities of approximately $1.4 million during the first six months ended June 30, 2022 related primarily to proceeds from the sale of common stock in April 2022. Net cash provided by financing activities of approximately $1.9 million during the first six months ended June 30, 2021 related primarily to proceeds from the sale of common stock in in March 2021. 

 

Lincoln Park Capital Stock Purchase Agreement

 

In March 2021, we and Lincoln Park Capital Fund, LLC (Lincoln Park) entered into a purchase agreement (the Purchase Agreement) and a registration rights agreement (the Registration Rights Agreement), pursuant to which we have the right to sell to Lincoln Park shares of our common stock having an aggregate value of up to $20 million, subject to certain limitations and conditions set forth in the Purchase Agreement. Pursuant to the terms of the Purchase Agreement, at the time we signed the Purchase Agreement, we sold 373,832 shares of our common stock at a price of $5.35 per share pursuant to the Purchase Agreement for gross proceeds of $2 million (and issued 80,000 shares of common stock to Lincoln Park as consideration for its commitment to purchase shares of our common stock, which consisted of 75,000 shares for Lincoln Park’s initial commitment and 5,000 shares issued on a pro rata basis in respect of Lincoln Park’s initial purchase of 373,832 shares). Thereafter, as often as every business day from and after one business day following the date of the Initial Purchase and over the 36-month term of the Purchase Agreement, we have the right, from time to time, at our sole discretion and subject to certain conditions, to direct Lincoln Park to purchase up to 100,000 shares of common stock, with such amount increasing as the closing sale price of the common stock increases; provided Lincoln Park’s obligation under any single such purchase will not exceed $2 million, unless we and Lincoln Park mutually agree to increase the maximum amount of such single purchase (each, a Regular Purchase). If we direct Lincoln Park to purchase the maximum number of shares of common stock it then may sell in a Regular Purchase, then in addition to such Regular Purchase, and subject to certain conditions and limitations in the Purchase Agreement, we may direct Lincoln Park in an Accelerated Purchase to purchase an additional amount of common stock that may not exceed the lesser of (i) 300% of the number of shares purchased pursuant to the corresponding Regular Purchase or (ii) 30% of the total number of shares of our common stock traded during a specified period on the applicable purchase date as set forth in the Purchase Agreement. Under certain circumstances and in accordance with the Purchase Agreement, we may direct Lincoln Park to purchase shares in multiple Accelerated Purchases on the same trading day. We expect to use the proceeds from this agreement for general corporate purposes and working capital. As of June 30, 2022, the Company had not made any sales of common stock to Lincoln Park under the Purchase Agreement other than the Initial Purchase.

 

 

Cantor Fitzgerald ATM Offering

 

On April 12, 2022, we entered into a sales agreement (the Sales Agreement) with Cantor Fitzgerald & Co. (Cantor) as the sales agent, pursuant to which we may offer and sell, from time to time, through Cantor, shares of our common stock having an aggregate offering price of up to $10.5 million (the ATM Offering). We are not obligated to sell any common stock shares pursuant to the Sales Agreement. Under the terms of the Sales Agreement, we will pay Cantor a commission of 3% of the aggregate proceeds from the sale of shares and reimburse certain legal fees. In April 2022, we sold 575,000 shares of common stock under the ATM Offering at then-market prices for total gross proceeds of approximately $1.5 million, with associated issuance costs of $232,000.

 

Future Funding Requirements

 

To date, we have generated modest revenues. We do not know when, or if, we will generate any revenue from our development stage biotherapeutic programs. We do not expect to generate any revenue from sales of our autologous and allogeneic cell therapy candidates unless and until we obtain regulatory approval. At the same time, we expect our expenses to increase in connection with our ongoing development activities, particularly as we continue the research, development and clinical trials of, and seek regulatory approval for, our therapeutic candidates. In addition, subject to obtaining regulatory approval for any of our therapeutic candidates and companion diagnostic, we expect to incur significant commercialization expenses for product sales, marketing, manufacturing and distribution. We anticipate that we will need additional funding in connection with our continuing operations.

 

Based upon our current operating plan, we believe that the cash and cash equivalents of $8.6 million as of June 30, 2022 are not sufficient to fund our planned expenditures and meet our obligations beyond the first quarter of 2023. In order to continue development of our therapeutic candidates beyond the first quarter of 2023, we plan to raise additional capital, potentially including non-dilutive collaboration and licensing arrangements, debt or equity financing, or a combination from these sources. We have based our estimates on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of our therapeutic candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures necessary to complete the development of our therapeutic candidates.

 

Our future capital requirements will depend on many factors, including:

 

•

the progress, costs, results and timing of our autologous CardiAMP Cell Therapy System and allogeneic Neurokinin-1 Receptor Positive clinical trials and related development programs;

 

•

FDA acceptance of our autologous CardiAMP Cell Therapy System and allogeneic Neurokinin-1 Receptor Positive therapies for heart failure and for other potential indications;

 

•

the outcome, costs and timing of seeking and obtaining FDA and any other regulatory approvals;

 

•

the costs associated with securing, establishing and maintaining commercialization and manufacturing capabilities;

 

•

the number and characteristics of product candidates that we pursue, including our product candidates in preclinical development;

 

•

the ability of our product candidates to progress through clinical development successfully;

 

•

our need to expand our research and development activities;

 

•

the costs of acquiring, licensing, or investing in businesses, products, product candidates and technologies;

 

•

our ability to maintain, expand and defend the scope of our intellectual property portfolio, including the amount and timing of any payments we may be required to make, or that we may receive, in connection with the licensing, filing, prosecution, defense and enforcement of any patents or other intellectual property rights;

 

 

•

the general and administrative expenses related to being a public company;

 

•

our need and ability to hire additional management and scientific, medical and sales personnel;

 

	•	the effect of competing technological and market developments;
	•	our need to implement additional internal systems and infrastructure, including financial and reporting systems; and

 

•

the cost of the impact from the COVID-19 pandemic.

 

Until such time that we can generate meaningful revenue from the sales of approved therapies and products, if ever, we expect to finance our operating activities through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements, and other collaborations, strategic alliances and licensing arrangements or a combination of these approaches. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our common stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing, if available, may involve agreements that include conversion discounts or covenants limiting or restricting our ability to take specific actions, such as incurring debt, making capital expenditures or declaring dividends. If we raise additional funds through government or other third-party funding, marketing and distribution arrangements or other collaborations, or strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, products, or therapeutic candidates or to grant licenses on terms that may not be favorable to us.

 

Our condensed consolidated financial statements as of June 30, 2022 have been prepared on the basis that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. Due to the factors described above, there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date these financial statements are issued. Our ability to continue as a going concern will depend in a large part, on our ability to raise additional capital. If adequate funds are not available, we may be required to reduce operating expenses, delay or reduce the scope of our product development programs, obtain funds through arrangements with others that may require us to relinquish rights to certain of our technologies or products that we would otherwise seek to develop or commercialize ourselves, or cease operations. While we believe in the viability of our strategy to raise additional funds, there can be no assurances that we will be able to obtain additional capital on acceptable terms and in the amounts necessary to fully fund our operating needs.

 

The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. If we are unable to continue as a going concern, we may be forced to liquidate assets. In such a scenario, the values received for assets in liquidation or dissolution could be significantly lower than the values reflected in our condensed consolidated financial statements. 

 

Off-Balance Sheet Arrangements

 

During the periods presented, we did not have, nor do we currently have, any off-balance sheet arrangements as defined under the rules of the Securities and Exchange Commission.

 

Recent Accounting Pronouncements

 

See Note 2 of our notes to condensed consolidated financial statements for information regarding recent accounting pronouncements that are of significance or potential significance to us.

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

There have been no material changes in our market risks during the three months ended June 30, 2022.

 

Our exposure to market risk is currently limited to our cash and cash equivalents, all of which have maturities of less than three months. The goals of our investment policy are preservation of capital, maintenance of liquidity needs, and fiduciary control of cash and investments. We also seek to maximize income from our investments without assuming significant risk or departing from our investment policy. We currently do not hedge interest rate exposure. Because of the short-term nature of our cash equivalents, we do not believe that an increase in market rates would have a material negative impact on the value of our portfolio.

 

Interest Rate Risk

 

As of June 30, 2022, based on current interest rates and total borrowings outstanding, a hypothetical 100 basis point increase or decrease in interest rates would have an immaterial pre-tax impact on our results of operations.

 

Foreign Currency Exchange Risks

 

We are a U.S. entity and our functional currency is the U.S. dollar. The vast majority of our revenues were derived from sales in the United States. We have business transactions in foreign currencies; however, we believe we do not have significant exposure to risk from changes in foreign currency exchange rates at this time. We do not currently engage in hedging or similar transactions to reduce our foreign currency risks. We will continue to monitor and evaluate our internal processes relating to foreign currency exchange, including the potential use of hedging strategies.

 

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

In connection with the preparation of this Quarterly Report on Form 10-Q, as of June 30, 2022, an evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of June 30, 2022, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

 

Changes in Internal Control over Financial Reporting

 

There were no changes to our internal control over financial reporting identified in connection with the evaluation required by rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the three months ended June 30, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

The Company may be subject to various claims, complaints, and legal actions that arise from time to time in the normal course of business. Management does not believe that the Company is party to any current pending legal proceedings. There can be no assurance that existing or future legal proceedings arising in the ordinary course of business or otherwise will not have a material adverse effect on the Company’s business, financial position, results of operations, or cash flows.  

 

ITEM 1A. RISK FACTORS

 

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021, which could materially affect our business, financial condition, or future results. The risks described in this report, our Annual Report on Form 10-K for the year ended December 31, 2021, and our Quarterly Reports on Form 10-Q filed periodically with the SEC are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or future results.  

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

ITEM 6. EXHIBIT INDEX

 

Exhibit Number

Exhibit Description

 

3.1(1)	Amended and Restated Certificate of Incorporation, as amended May 6, 2019
3.2(2)	Amended and Restated Bylaws
31.1*	Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of Principal Financial Officer Pursuant to Rule 13a-14(b) and Section 906 of the Sarbanes-Oxley Act of 2002.

 

101.INS+	Inline XBRL Instance Document
101.SCH+	Inline XBRL Taxonomy Extension Schema Document
101.CAL+	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF+	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB+	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE+	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

*	Filed herewith.
**	Furnished herewith.
+	The financial information contained in these XBRL documents is unaudited and is furnished, not filed with the Securities and Exchange Commission.
(1)	Previously filed as Exhibit 3.1 to the Form 10-Q for the quarterly period ended June 30, 2019 filed by us on August 14, 2019.
(2)	Previously filed as Exhibit 3.2 to the Current Report on Form 8-K filed by us on April 11, 2017.

 

 

SIGNATURES

 

 

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

 

	BIOCARDIA, INC. (Registrant)
Date:                        August 10, 2022	By:	/s/ Peter Altman
		Peter Altman
		President and Chief Executive Officer
		(Principal Executive Officer)
Date:                        August 10, 2022	By:	/s/ David McClung
		David McClung
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

 

Exhibit 31.1

 

Certification of Principal Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

I, Peter Altman, certify that:

 

1.         I have reviewed this Quarterly Report on Form 10-Q of BioCardia, 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 10, 2022

	/s/ Peter Altman
	Name: Peter Altman
	Title: President and Chief Executive Officer (Principal Executive Officer)

 

 

Exhibit 31.2

 

Certification of Principal Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

I, David McClung, certify that:

 

1.         I have reviewed this Quarterly Report on Form 10-Q of BioCardia, 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 10, 2022

	/s/ David McClung
	Name: David McClung
	Title: Chief Financial Officer (Principal Financial Officer)

 

 

Exhibit 32.1

 

Certification of Principal Executive Officer

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, Peter Altman, the President and Chief Executive Officer of BioCardia, Inc. (the "Company"), hereby certify, that, to my knowledge:

 

1.      The Quarterly Report on Form 10-Q for the period ended June 30, 2022 (the "Report") of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; 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 10, 2022

	/s/ Peter Altman
	Name: Peter Altman
	Title: President and Chief Executive Officer (Principal Executive Officer)

 

 

Exhibit 32.2

 

Certification of Principal Financial Officer

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I, David McClung, the Chief Financial Officer of BioCardia, Inc. (the “Company”), hereby certify, that, to my knowledge:

 

1.       The Quarterly Report on Form 10-Q for the period ended June 30, 2022 (the “Report”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; 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 10, 2022

	/s/ David McClung
	Name: David McClung
	Title: Chief Financial Officer (Principal Financial Officer)

 

 

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