UNITED STATES

SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549

 

FORM 10-K

 

(Mark One)

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

 

FOR THE FISCAL YEAR ENDED JUNE 30, 20172021

 

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

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

 

For the transition period from ____________to _____________

 

Commission File Number:000-55292001-39015

 

BIOVIE INC. (F/K/A NANOANTIBIOTICS, INC.)

(Exact name of registrant as specified in its charter)

 

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

 

 100 Cummings Center, 2120 Colorado AvenueSuite 247-C230 
 Beverly, MA 01915Santa Monica, CA90404 
 (Address of principal executive offices, Zip Code) 
   
 (312)-283-5793-283-5793 
 (Registrant’s telephone number, including area code) 

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stock, $.0001 par value per shareBIVIThe NASDAQ Stock Market, LLC

 

Securities registered pursuant to Section 12(g) of the Act:

$.0001 par value common stockNone Over the Counter Bulletin Board

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. 

Yes No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act 

Yes No

 

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).

 

Yes                                          No

 

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

 

Large accelerated filerAccelerated FilerAccelerated filerFilerNon-accelerated filer
Non-Accelerated FilerSmaller reporting company
Emerging growth company
(Do not check if a smaller reporting 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 if the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7362(b)) by the registered public accounting firm that prepared or issued its audit report.

Yes                                           No

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

YesNo

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. 

Yes                                          No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act 

Yes                                          No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

 

The Aggregateaggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed fourthsecond fiscal quarter June 30, 2017 was $26,658,250.$18,143,043.

 

There were 91,925,00024,833,324 shares of the Registrant’s $0.0001 par value Class A common stock outstanding as of June 30, 2017.August 27, 2021.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the 2021 definitive Proxy Statement are incorporated by reference into Part III of this Form 10-K.

 

BIOVIE INC. (F/K/A NANOANTIBIOTICS, INC.)

 

FORM 10-K INDEX

 

PART I

Item 1.PART IDescription of Business1
Item 1A.Risk Factors9
Item 1.Business2
Item 1A.Risk Factors14
Item 1B. Unresolved Staff Comments2229
Item 2.Description of PropertyProperties2229
Item 3.Legal Proceedings2229
Item 4.Mine Safety DisclosureDisclosures2229

PART II

PART II
Item 5.Market for Registrant’s Common Equity, and Related Stockholder Matters and Issuer Purchases of Equity Securities2330
Item 6.Selected Financial Data[Reserved]2330
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations2430
Item 7A.Quantitative and Qualitative Disclosures About Market Risk2833
Item 8.Financial Statements and Supplementary Data2933
Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure4533
Item 9A(T).9AControls and Procedures4533

PART III

Item 9B.Other Information34
Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections34
PART III
Item 10.Directors, Executive Officers and Corporate Governance4735
Item 11.Executive Compensation5035
Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters5135
Item 13.Certain Relationships and Related Transactions, and Director Independence5235
Item 14.Principal Accountant Fees and Services5235

PARTIV

PART IV
Item 15.Exhibits and Financial Statement Schedules5336
Item 16.SignaturesForm 10-K Summary 54

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BIOVIE INC. (F/K/A NANOANTIBIOTICS, INC.)

FORWARD-LOOKING STATEMENTS

 

This Annual Report on Form 10-K and the documents incorporated herein by reference containreport contains forward-looking statements that have been made pursuant towithin the provisionsmeaning of Section 21E of the Private Securities Litigation ReformExchange Act of 1995. Such1934, 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 our research and development activities, distributor channel; compliance with regulatory impositions; and our capital needs. Although we believe that the expectations reflected in the forward-looking statements are based on current expectations, estimatesreasonable, 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 projections about BioVie Inc.’s industry, management beliefs, and assumptions made by management. Words suchwe assume no obligation to update any forward-looking statements contained in this report as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variationsa result of such words and similar expressionsnew information or future events or developments. Thus, you should not assume that our silence over time means that actual events are intended to identifybearing out as expressed or implied in such forward-looking statements. These statements are not guaranteesYou 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 future performance and are subject to certainthe risks, uncertainties and assumptionsother factors that may affect our business.

All statements other than statements of historical fact are difficult to predict; therefore, actual results and outcomes may differ materially from what is expressed or forecasted in any suchstatements that could be deemed forward-looking statements. The Company assumes no obligation and does not intend to update these forward-looking statements, except as required by law. When used in this report, the terms “BioVie”, “Company”, “we”, “our”, and “us” refer to BioVie, Inc.

 

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PART I

ITEM 1.DESCRIPTION OF BUSINESS

 

IntroductionBioVie Inc. is a clinical-stage company developing innovative drug therapies to overcome unmet medical needs in chronic debilitating conditions.

 

In liver disease, our orphan drug candidate BIV201 (continuous infusion terlipressin) is being developed as a future treatment option for patients suffering from ascites and other life-threatening complications of advanced liver cirrhosis caused by NASH, hepatitis, and alcoholism. The initial target for BIV201 therapy is refractory ascites. These patients suffer from frequent life-threatening complications, generate more than $5 billion in annual treatment costs, and have an estimated 50% mortality rate within 6 to 12 months. The FDA has never approved any drugs to treat refractory ascites. A Phase 2a clinical trial of BIV201 was completed in 2019, and a multi-center, randomized and controlled Phase 2b trial is currently underway at several US medical centers including Vanderbilt University, the Mayo Clinic, and University of Pennsylvania (NCT NCT04112199). Top-line results are expected in early 2022, to be followed by a proposed single pivotal Phase 3 trial beginning in 2022. In June 2021, BioVie received written feedback from the FDA in response to a Type B meeting request to conduct a pivotal US Phase 3 clinical trial in HRS-AKI, which is a life-threatening complication of advanced ascites. Based on the guidance received, we are revising certain elements of our proposed study and are planning to initiate this study in late 2021.

In neurodegenerative disease,BioVie Inc. (F/K/A NanoAntibiotics,acquired the biopharmaceutical assets of NeurMedix, Inc., the “Company”)a privately held clinical-stage pharmaceutical company, in June 2021. The acquired assets include NE3107, a potentially selective inhibitor of inflammatory ERK signaling which, based on animal studies is believed to reduce neuroinflammation. NE3107 is a development stage enterprisenovel orally administered small molecule that was incorporatedis thought to inhibit inflammation-driven insulin resistance and major pathological inflammatory cascades with a novel mechanism of action. There is emerging scientific consensus that both inflammation and insulin resistance play fundamental roles in the statedevelopment of Nevada on April 10, 2013.Alzheimer’s and Parkinson’s Disease, and NE3107 could, if approved, represent an entirely new medical approach to treating these devastating conditions affecting an estimated 6 million Americans suffering from Alzheimer’s and 1 million from Parkinson’s. The CompanyFDA has authorized a potentially pivotal Phase 3 randomized, double-blind, placebo-controlled, parallel group, multicenter study to evaluate NE3107 in subjects who have mild to moderate Alzheimer’s disease (NCT04669028). BioVie is engagedplanning to initiate this trial in the discovery,second half of 2021 and is targeting primary completion in late 2022. In addition to Alzheimer’s disease, the Company plans to advance NE3107 in Parkinson’s based on promising results from preclinical studies. Inflammation-driven insulin resistance is implicated in a broad range of serious diseases, including multiple myeloma and prostate cancer, and we plan to begin exploring these opportunities in the coming months using NE3107 or related compounds acquired in the NeurMedix asset purchase.

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Pipeline Overview

The following diagram shows our clinical development and commercializationpipeline as of mid- 2021:

(GRAPHIC)

Liver Cirrhosis Program

BioVie’s orphan drug candidate BIV201 (continuous infusion terlipressin) represents a therapy targetingnovel investigational approach to the treatment of ascites due to chronic liver cirrhosis. Ascites due to liver cirrhosis is a life-threatening condition affecting about 100,000 Americans and many times more worldwide. Our therapy BIV201 is based on a drug that is approved in about 40 countries to treat related complications of liver cirrhosis (part of the same disease pathway as ascites), but not yet available in the US. BIV201’sUnited States. The active agent in BIV201, terlipressin, is a potent vasoconstrictor and has shown efficacy for reducing portal hypertensionis marketed in studies around the world.multiple foreign countries. The goal of the BIV201 development program is for BIV201 to interruptfocused on interrupting the ascites disease pathway, thereby halting the cycle of accelerating fluid generation in ascites patients.

BioVie completed a Phase 2a clinical trial of BIV201 in six patients with refractory as cites due to advanced liver cirrhosis at the McGuire Research Institute in Richmond, VA. In April 2019, we announced top-line results for this clinical trial. The following results were observed:

Continuous infusion of terlipressin via portable infusion pump was maintained for 28 days in three patients with refractory ascites, and all patients remained hemodynamically stable during treatment.

The steady state plasma concentration data characterized terlipressin pharmacokinetics (PK) within the predicted PK model concentrations.

Four of the six patients treated with BIV201 experienced an increase in the number of days between paracenteses ranging from 71% to 414% compared to prior to initiating therapy.

In June 2019, we met with representatives of the FDA for a Type C Guidance Meeting to plan our next clinical study in ascites. We discussed our clinical development program with the FDA and proposed safety and efficacy endpoints required for future marketing approval. In September 2019, the FDA granted our Type B meeting request and committed to providing feedback in early 2020 for our proposed clinical trial design. In April 2020, we received the FDA’s written response to our Type B meeting questions which required changes to our clinical trial design. Subsequently we received further guidance from the FDA. Based on this guidance, the Company finalized the clinical trial protocol and began preparing for a randomized 30-patient Phase 2b study. The IND for this study was submitted and has become effective. As of July 2021, seven of nine planned US study centers have been activated and are actively screening patients, and two patients have been enrolled in the study. We plan to follow this study with a larger potentially pivotal Phase 3 clinical trial expected to begin in 2022. The FDA communicated that pending positive Phase 2 study results, a sufficiently large and well-controlled Phase 3 trial, with supportive trend data from the Phase 2b (statistical significance not required), could potentially yield the clinical data needed to apply for BIV201 marketing approval. The Phase 2b clinical trial protocol is summarized on www.clinicaltrials.gov, trial identifier NCT04112199.

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We have invented a proprietary novel liquid formulation of terlipressin that is intended to improve convenience for outpatient administration and avoid potential formulation errors when pharmacists reconstitute the powder version. In November 2019, we announced the completion of quality control testing and released the batch for use in our next clinical trial pending FDA clearance. In March 2020, we submitted a detailed information package to the FDA’s CMC division. In May 2020, we received CMC division clearance to use the new BIV201 prefilled terlipressin syringe in the current Phase 2b trial subject to conducting certain additional standard analytical testing which has been successfully completed. As of June 2021, analytical testing results have confirmed room temperature stability of the prefilled syringe in storage for 18 months, with the potential for up to two years of stability (yet to be confirmed). Room temperature storage presents a key product differentiation versus terlipressin products in countries where the drug is approved. To the best of the Company’s knowledge, all other terlipressin products sold globally must be stored under refrigeration and there is no prefilled syringe format of terlipressin available for treating patients in these countries. BioVie has also filed a Patent Cooperation Treaty (“PCT”) application covering our novel liquid formulations of terlipressin (international patent application PCT/US2020/034269, published as WO2020/237170) and we plan to seek patent protection in at least the United States, Europe, China and Japan.

BIV201 (continuous infusion terlipressin) has the potential to improve the health of thousands of patients suffering from life-threatening complications of liver cirrhosis due to hepatitis, NASH, and alcoholism. The FDA has granted Fast-Track status and Orphan Drug designation for the most common of these complications, ascites, which represents a significant unmet medical need. Patients with cirrhosis and ascites account for an estimated 116,000 U.S. hospital discharges annually, with frequent early readmissions. Those requiring paracentesis (removal of ascites fluid) experience an average hospital stay lasting 8 days incurring over $86,000 in medical costs (HCUP Nationwide Readmissions Database 2016). This translates into a total addressable ascites market size for BIV201 therapy exceeding $650 million based on Company estimates. The FDA has never approved any drug specifically for treating ascites. For patients with refractory ascites the mean one-year survival rate is only 50% (Bureau et al. 2017). BIV201 has also received Orphan Drug designation for hepatorenal syndrome (“HRS”). Patients with refractory ascites often progress to HRS which is the onset of kidney failure and requires emergency hospitalization. About one-half of these patients typically succumb within only 2 to 4 weeks and no drug therapies have been FDA approved specifically to treat HRS.

The BIV201 development program began at LAT Pharma LLC. On April 11, 2016, the Companywe acquired LAT Pharma LLC and the rights to its BIV201 development program. In March 2017, BioVie received notification fromprogram and currently own all development and marketing rights to the US FDA allowing itproduct candidate. We and PharmaIN, LAT Pharma’s former partner focused on the development of new modified product candidates in the same therapeutic field but not including BIV201, have agreed to commencepay royalties equal to less than 1% of future net sales of each company’s ascites drug development programs, or if such program is licensed to a mid-stage (Phase 2a) clinical trialthird party, less than 5% of each company’s net license revenues. On December 24, 2018, we returned our partial ownership rights to the PharmaIN modified terlipressin development program and simultaneously paid the remaining balance due on a related debt. PharmaIN’s rights to our program remain unchanged. We have a pending U.S. patent application 16/379,446 (a continuation application related to the ’945 Patent) for its Orphan drug candidate BIV201.

The Company’s activities are subjectthe use of BIV201 for the treatment of patients diagnosed with ascites due to significant risksliver cirrhosis in the outpatient setting using ambulatory pump infusion, and uncertainties including failure to secure additional funding to properly execute the company’s business plan. have corresponding patent applications pending in Japan, Europe, China and Hong Kong.

 

About Ascites and Liver Cirrhosis

 

About 1 million600,000 Americans and millions worldwide suffer from liver cirrhosis. Cirrhosis is the 12th11th leading cause of death due to disease in the US, killing an estimated 30,000more than 40,000 people each year. The condition results primarily from hepatitis, alcoholism, and fatty liver disease linked to obesity. Ascites is a common complication of advanced liver cirrhosis, involving kidney dysfunction and the accumulation of large amounts of fluid in the abdominal cavity.

 

The Need for an Ascites Therapy

 

With no medications approved by the FDA specifically for treating ascites, an estimated 40% of patients die within two years of diagnosis. Certain drugs approved for other uses such as diuretics may provide initial relief, but patients may fail to respond to treatment as ascites worsens. This represents a critical unmet medical need. USU.S. treatment costs for liver cirrhosis, including ascites and other complications, are estimated at more than $4$5 billion annually.

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The Ascites Development Pathway

 

 

(GRAPHIC)

 

Most experts agree that ascites develops through a sequence of events illustrated by the above diagram. High blood pressure in the vein that supplies blood to the liver, called “portal hypertension,” occurs as increasing liver damage (fibrosis) impedes blood flow through the liver. This causes vasodilation and blood pooling in the central or “splanchnic” region of the body and low blood volume in the arteries. The decrease in effective blood volume activates a signaling pathway (“neurohormonal systems”) which tells the kidneys to retain large amounts of salt and water in an effort to increase blood volume. Ultimately the retention of excess sodium and water leads to the formation of ascites as these substances “weep” from the liver and lymph system and collect in the patient’s abdomen.

 

The BIV201 Mechanism of Action

 

BIV201 is being developed by BioVie with the goal of alleviating the portal hypertension and correcting splanchnic vasodilation, thereby increasing effective blood volume and reducing the signals to the kidneys to retain excess salt and water. If successful, BIV201 could halt the cycle of accelerating fluid generation in ascites patients and reduce the need for the frequent and painful paracentesis procedures many of these patients currently require.

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Future Possible BIV201 Indications

 

Based on international investigative studies around the world of the active agent in BIV201, terlipressin, our new drug candidate has potential future applications in other life-threatening conditions due to liver cirrhosis, such as those listed below. Securing marketing approvals for any of these new uses will require well-controlled clinical trials to satisfy the FDA and/or other countries’ regulatory requirements, none of which have commenced at this time. The Company may be unable to, or chose not to, pursue the development BIV201 for these indications.

 

·Bleeding Esophageal Varices (BEV): The bursting of blood vessels lining the esophagus due to high blood pressure (“portal hypertension”) in the vein which supplies blood to the liver resulting as a result of advanced liver cirrhosis. This situation requires emergency treatment to avoid blood loss and death.

 

·Hepatorenal syndrome (HRS)Syndrome-Acute Kidney Injury (HR/S-AKI): As their disease progresses liver cirrhosis and ascites progress, the patients’ kidneys may begin to fail, and this deadly condition may set in. It often occurs once a patient no longer responds to (off-label) drugs used to control ascites. The second stage is called “type 1 HRS” andTreatment of HRS-AKI requires hospitalization as multiple organ failure and death may occur.occur, typically within 2-4 weeks absent liver transplant. We obtained Orphan Drug designation for BIV201 in the U.S. for the treatment of HRS on November 21, 2018. In May 2021, BioVie submitted a Type B Meeting Package to the FDA seeking to conduct a single pivotal US Phase 3 clinical trial in the treatment of HRS-AKI. In June 2021, we received FDA feedback on the proposed trial design. We are currently finalizing the trial protocol and statistical analysis plan based on their guidance, and plan to commence the trial late this year.

 

·Hyponatremia: This term refers to “low salt in the bloodstream,” another dangerous condition which can occur as a result of advanced liver cirrhosis.

Neurodegenerative Disease Program

 

In June 2021, BioVie purchased the assets of NeurMedix, Inc., a privately held clinical-stage biopharmaceutical company focused on developing novel therapeutic products for the treatment of neurodegenerative and neurological disorders and certain cancers. NeurMedix was formed in November 2014 to acquire and commercialize intellectual property and know-how. In December 2014, NeurMedix’s parent entity purchased all the assets related to NE3107 from Harbor Therapeutics, Inc. and these assets were transferred to NeurMedix in February 2015. NE3107 is believed to be a selective inhibitor of inflammatory ERK signaling that reduces neuroinflammation. It is an orally administered potentially first-in-class small molecule that may inhibit inflammation-driven insulin resistance and major pathological inflammatory cascades with a novel mechanism of action. There is emerging scientific consensus that both inflammation and insulin resistance play fundamental roles in the development of Alzheimer’s and Parkinson’s Disease, and NE3107 could, if approved, represent an entirely new medical approach to treating these devastating conditions. The FDA has authorized a potentially pivotal Phase 3 randomized, double-blind, placebo-controlled, parallel group, multicenter study to evaluate NE3107 in subjects who have mild to moderate Alzheimer’s disease (NCT04669028).

Alzheimer’s Disease

Alzheimer’s disease (AD), which affects an estimated 6 million Americans, is a neuroinflammatory and neurodegenerative condition characterized by progressive deterioration of cognitive function and loss of short-term memory and executive function. Cognitive tests quantifying AD severity have been exhaustively developed. Formal diagnosis of AD has historically been dependent on the presence of extraneuronal amyloid beta (Aβ) plaques, which can only be observed at autopsy or with the aid of sophisticated radioimaging techniques. However, diagnostic methods have recently been approved that quantify Aβ in peripheral blood and correlate well with imaging results. Aβ plaques can also be found in people without apparent AD symptoms, which has cast doubt about the role of Aβ as the central mediator of disease pathology.

Scientific investigations in the past twenty years have provided strong evidence that inflammation, type 2 diabetes (T2D), and inflammation-driven insulin resistance (IR) are drivers of AD. The link between these factors and cognitive impairment are described by relatively new terms, type 3 diabetes and metabolic-cognitive syndrome.

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Joint VentureA large body of evidence supports inflammation as a primary driver of pathology in AD. The major inflammation signaling node, NFkB, and Possible Accessthe cytokine tumor necrosis factor (TNF) are important initiators of inflammatory signaling in AD pathology. NE3107 is believed to Early-Stage Compoundsinhibit extracellular signal regulated kinase (ERK)/NFkB activation and TNF production stimulated by inflammatory mediators, such as lipopolysaccharide. Inhibition of NFkB activation and TNF production from this type of stimulation has broad potential implications for reduction of pathological peripheral and central nervous system (CNS) inflammatory signaling in AD, which include reduction of inflammation-driven insulin resistance, decreased inflammatory cell infiltration into the CNS, and decreased microglia activation. Reduction of systemic inflammation and inflammation driven insulin resistance are also predicted to have beneficial effects on hypothalamus-pituitary-adrenal (HPA) axis dysregulation and hippocampal dysregulation of cortisol secretion that are consequences of adipose inflammation and insulin resistance, and known to promote cognitive impairment, and are also forward-feeding for insulin resistance.

Inflammation, insulin resistance, and associated metabolic dysregulation in the brain contribute to Aβ oligomerization and aggregation, phospho-tau formation, reduced neuron survival stimulus, and a forward-feeding cycle of neuronal energy deficit and oxidative stress, causing neuronal dysfunction (cognitive impairment) and neurodegeneration. NE3107’s combination of anti-inflammatory and insulin sensitizing activity has the potential to disrupt this forward-feeding cycle of AD pathology.

Insulin has a major role in metabolic regulation and neuron survival, while insulin resistance and T2D are closely linked to AD pathology. Insulin signaling is involved in synaptic plasticity, learning, and memory. Exogenous insulin enhances cognition in normal and cognitively impaired subjects. Insulin resistance is linked to cognitive impairment.

 

The Companymultifactorial influence of insulin signaling on neuron survival and cognition suggests that correction of insulin signaling deficits in the target population may provide significant benefits on both cognition and disease progression. Additional rationale for targeting metabolic dysregulation with NE3107 has come from recent work showing peripheral insulin resistance promotes insulin resistance and senescence in the CNS.

There is also extensive literature on the complex role of adipose tissue inflammation in systemic inflammation, insulin resistance, hypothalamus-pituitary-adrenal axis (HPA) dysregulation and chronic cortisol excess in cognitive impairment in AD. Obesity and inflammation are closely linked in expanding adipose tissue, where the production of inflammatory cytokines and increased cortisol are driven though up-regulation of 11β-hydroxysteroid dehydrogenase type 1 and adipocyte mineralocorticoid receptor activation. Inflamed adipose tissue interacts with the HPA axis and hippocampus to increase systemic cortisol, and promote hippocampal inflammation through chronically elevated cortisol, which freely penetrates the blood-brain barrier. Hyperglycemia (secondary to insulin resistance) exacerbates adrenal cortisol production and promotes forward feeding of inflammation and HPA-hippocampal dysregulation.

Systemic inflammation from inflamed adipose and associated mononuclear cells, promotes CNS inflammation with associated cognitive decline and neurodegeneration. A therapy with anti-inflammatory activity against systemic/adipose inflammation and factors that dysregulate cortisol secretion, such as hyperglycemia, has the potential to decrease cognitive impairment and neurodegenerative mechanisms that have been linked to cortisol excess.

Parkinson’s Disease

Neuroinflammation and activation of brain microglia, leading to increased proinflammatory cytokines (particularly tumor necrosis factor (TNF)) play a pivotal role in Parkinson’s Disease (PD), which affects an Agreementestimated 1 million Americans. Daily administration of levodopa (converted to dopamine in the brain) is the current standard of care treatment for this movement disorder, but prolonged daily administration often leads to side effects of uncontrolled movements called levodopa-induced dyskinesia, commonly referred to as LID. Recent evidence demonstrates that daily administration of levodopa further increases neuroinflammation, microglia activation, and TNF inflammatory damage in neurons.

We have observed that in a mouse model of PD, NE3107 decreased inflammation and TNF in the brain and increased neuron survival (Nicoletti, 2012 Parkinson’s Disease 969418.) In this neurotoxin induced model, NE3107 decreased clinical signs of disease and neuronal death compared to placebo treated mice.

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An unpublished study in a neurotoxin induced marmoset model of Parkinson’s disease reported that administration of NE3107 decreased movement abnormalities that are the clinical signs of the disease. In the same study, NE3107 in combination with PharmaIN Corporation (Bothell, WA) providinglevodopa had a stronger effect on clinical signs of disease than levodopa or NE3107 alone, while marmosets treated with NE3107 developed less LID. NE3107-treated monkeys also exhibited neuroprotective activity that promoted the survival of twice as many neurons in the substantia nigra (primary region of the brain that degenerates to cause parkinsonism) as monkeys treated with placebo. The results from the marmoset study suggest that NE3107 may decrease clinical signs of disease in humans (improve motor function), which if true could enable a straightforward clinical development strategy to test NE3107 in PD patients needing promotoric therapy.

If approved as a promotoric agent, NE3107 could provide a non-dopaminergic alternative to Parkinson’s patients, and an opportunity to significantly delay the need to start levodopa therapy. This could represent a first step toward supplanting levodopa as the primary PD therapy, and in addition to delaying the emergence of LID, could also imply a slowing of disease progression, the most important and still unmet objective of PD drug development.

Oncology

In certain limited rightstypes of cancers, inflammatory cell signaling is at the heart of disease progression. NE3107 has been observed to decrease inflammatory cell signaling in vitro, in animal models and informationin human clinical trials. Recently, evidence has developed that cancers are dependent on their program to develop novel modified terlipressin compounds. Although at an early stage, these compounds holdinflammatory cell signaling, not only in the promise of simplertumor cells, but also in immune, stromal and potentially safer dosing for patients outsidehematopoietic cells in the hospital. If this program makes significant advances, BioVie may contact PharmaIN to explore a licensing opportunity.tumor microenvironment.

 

The Companyinflammatory pathways that have been elucidated in non-cancerous cells in the tumor microenvironment are similar to those NE3107 decrease in inflammatory cells in metabolic disorders and PharmaIN have exchanged small (low single-digit) ownership rights to each other’s ascites drug development programs,neurodegeneration. BioVie is developing clinical trial-enabling data for Multiple Myeloma and may work together to advance both of them to eventual product commercialization.

Efflux Pump Antibiotics Program

Prior to the Merger the Company was exclusively developing novel nanotechnology anti-infective drugs to combat multi-drug resistant bacteria. We are at an early stage of discovery and development of broad spectrum antibiotics for gram-negative and gram-positive bacterial infections. Developing this technology in-house is resource-intensive with respect to time, personnel and capital necessary for scientific discovery. For further development of our nanoantibiotic technology we will need to find and license additional nanotechnology to complete our planned products.Presently this program is inactive as we are focusing our efforts on BIV201.Prostate cancers.

 

Intellectual Property

 

BioVie relies on a combination of patent, trade secrecysecret, other intellectual property laws (such as FDA data exclusivity), nondisclosure agreements, and patent strategyother measures to protect our confidentialproposed products. We require our employees, consultants, and advisors to execute confidentiality agreements and to agree to disclose and assign to us all inventions conceived during the workday, using our property, or which relate to our business. Despite any measures taken to protect our intellectual property (IP), unauthorized parties may attempt to copy aspects of our products or to obtain and use information and seek market exclusivitythat we regard as proprietary.

BIV201 was awarded Orphan Drug Designations in the U.S. for our products. In May 2017 the Company announced issuancetreatment of a US patent covering the use of BIV201 in thehepatorenal syndrome (received November 21, 2018) and treatment of ascites due to liver cirrhosis with administration via ambulatory pump.all etiologies except cancer (received September 8, 2016). We also filed a PCT application covering our novel liquid formulations of terlipressin (international patent application PCT/US2020/034269, published as WO2020/237170) and we will seek patent protection in at least the United States, Europe, China and Japan. In July 2017April 2020, we elected certain claims in our pending U.S. patent application 16/379,446 (a continuation application related to the Company announced filing’945 Patent, which was canceled pursuant to an applicationinter partes review proceeding, discussed above). In addition, we have applied for similar patent coverage in Japan. Additionally a PCT (“placeholder” for a future patent filing) has been filed in Europe. BioVie has secured Orphan Drug designation formethod of treating ascites with BIV201 in the treatmentJapan, Europe, China and Hong Kong.

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As of August 5, 2021, we have fifteen (15) issued U.S. patents, one (1) pending U.S. patent application, one (1) pending U.S. provisional application (provisional application filed May 18, 2021) and Drug Administration (FDA).six (6) issued foreign patents directed to protecting NE3107 and related compounds and methods of making and using thereof. The Company has applied for two additional Orphan Drug designations which could be granted in late 2017 or early 2018.U.S. patents and pending patent applications and their expiration dates are provided below.

 

Research and Development

TitlePatent Application
Number
Patent
Number
Expiration
Date
Steroids Having 7-Oxygen and 17-Heteroaryl Substitution13/095,528
14/027,825
14/027,842
8,569,275
9,102,702
9,115,168
2/14/2024
3/28/2024
3/28/2024
Unsaturated Steroid Compounds13/030,3268,586,7706/2/2026
Solid State Forms of a Pharmaceutical12/418,5598,252,947*4/18/2030
Crystalline Anhydrate Forms of a Pharmaceutical14/459,528
15/348,107
16/598,694
17/240,728
9,555,046
9,850,271
10,995,112
pending
4/3/2029
4/3/2029
4/3/2029
Pharmaceutical Solid State Forms12/370,5108,518,9229/24/2031
Methods of Preparing Pharmaceutical Solid State Forms13/919,5939,314,4716/28/2029
Steroid Tetrol Solid State Forms12/272,7678,486,9261/10/2030
Drug Identification and Treatment Method11/941,9368,354,3967/7/2031
Method For Preparing Substituted 3,7-Dihydroxy Steroids13/664,304
14/886,738
9,163,059**
9,994,608
6/5/2029
6/5/2029
Treatment Methods Using Pharmaceutical Solid State Forms14/459,4939,877,9724/3/2029
Compositions for Treatment of Neurodegenerative Conditions63/189,880provisional

 

*Foreign counterparts issued in Australia, Canada, Europe and South Korea expire 4/3/2029.

For the year ended June 30, 2017, the Company spent $466,354 in research and development activities.

**Foreign counterparts issued in Europe and Japan expire 6/5/2029.

 

Government Regulation

 

Government authorities in the United States, at the federal, state and local level, and in other countries extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing and export and import of products such as those we are developing. Any pharmaceutical candidate that we develop must be approved by the FDA before it may be legally marketed in the United States and by the appropriate foreign regulatory agency before it may be legally marketed in foreign countries.

 

United States Drug Development Process

 

In the United States, the FDA regulates drugs under the Federal Food, Drug and Cosmetic Act, or FDCA, and implementing regulations. Drugs are also subject to other federal, state and local statutes and regulations. Biologics are subject to regulation by the FDA under the FDCA, the Public Health Service Act, or the PHSA, and related regulations, and other federal, state and local statutes and regulations. Biological products include, among other things, viruses, therapeutic serums, vaccines and most protein products. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations require the expenditure of substantial time and financial resources. Failure to comply with the applicable United States requirements at any time during the product development process, approval process or after approval, may subject an applicant to administrative or judicial sanctions. FDA sanctions could include refusal to approve pending applications, withdrawal of an approval, a clinical hold, warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect on us.

 

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The process required by the FDA before a drug or biological product may be marketed in the United States generally involves the following:

 

Completion of preclinical laboratory tests, animal studies and formulation studies according to Good Laboratory Practices or other applicable regulations;

Completion

Submission to the FDA of an Investigational New Drug Application, or an IND, which must become effective before human clinical trials may begin;

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Performance of adequate and well-controlled human clinical trials according to the FDA’s current good clinical practices, or GCPs, to establish the safety and efficacy of the proposed drug or biologic for its intended use;

 

Submission to the FDA of an Investigational New Drug Application, or an IND, which must become effective before human clinical trials may begin;

Submission to the FDA of a New Drug Application, or an NDA, for a new drug product, or a Biologics License Application, or a BLA, for a new biological product;

 

Performance of adequate and well-controlled human clinical trials according to the FDA's current good clinical practices, or GCPs, to establish the safety and efficacy of the proposed drug or biologic for its intended use;

Satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the drug or biologic is to be produced to assess compliance with the FDA’s current good manufacturing practice standards, or cGMP, to assure that the facilities, methods and controls are adequate to preserve the drug’s or biologic’s identity, strength, quality and purity;

 

Submission to the FDA of a New Drug Application, or an NDA, for a new drug product, or a Biologics License Application, or a BLA, for a new biological product;

Potential FDA audit of the nonclinical and clinical trial sites that generated the data in support of the NDA or BLA; and

 

Satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the drug or biologic is to be produced to assess compliance with the FDA's current good manufacturing practice standards, or cGMP, to assure that the facilities, methods and controls are adequate to preserve the drug's or biologic's identity, strength, quality and purity;

Potential FDA audit of the nonclinical and clinical trial sites that generated the data in support of the NDA or BLA; and

FDA review and approval of the NDA or BLA.

FDA review and approval of the NDA or BLA.

 

The lengthy process of seeking required approvals and the continuing need for compliance with applicable statutes and regulations require the expenditure of substantial resources. There can be no certainty that approvals will be granted.

 

Clinical trials involve the administration of the drug or biological candidate to healthy volunteers or patients having the disease being studied under the supervision of qualified investigators, generally physicians not employed by or under the trial sponsor'ssponsor’s control. Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor subject safety. Each protocol must be submitted to the FDA as part of the IND. Clinical trials must be conducted in accordance with the FDA'sFDA’s good clinical practices requirements. Further, each clinical trial must be reviewed and approved by an independent institutional review board, or IRB, at or servicing each institution at which the clinical trial will be conducted. An IRB is charged with protecting the welfare and rights of trial participants and considers such items as whether the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the informed consent form that must be provided to each clinical trial subject or his or her legal representative and must monitor the clinical trial until it is completed.

 

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Human clinical trials prior to approval are typically conducted in three sequential Phasesphases that may overlap or be combined:

 

• Phase 1.  The drug or biologic is initially introduced into healthy human subjects and tested for safety, dosage tolerance, absorption, metabolism, distribution and excretion. In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients having the specific disease.

Phase 1.  The drug or biologic is initially introduced into healthy human subjects and tested for safety, dosage tolerance, absorption, metabolism, distribution and excretion. In the case of some products for severe or life-threatening diseases, especially when the product may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients having the specific disease.

 

• Phase 2.  The drug or biologic is evaluated in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance, optimal dosage and dosing schedule for patients having the specific disease.

Phase 2.  The drug or biologic is evaluated in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance, optimal dosage and dosing schedule for patients having the specific disease.

 

• Phase 3.  Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials, which usually involve more subjects than earlier trials, are intended to establish the overall risk/benefit ratio of the product and provide an adequate basis for product labeling. Generally, at least two adequate and well-controlled Phase 3 clinical trials are required by the FDA for approval of an NDA or BLA.

Phase 3.  Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials, which usually involve more subjects than earlier trials, are intended to establish the overall risk/benefit ratio of the product and provide an adequate basis for product labeling. Generally, at least two adequate and well-controlled Phase 3 clinical trials are required by the FDA for approval of an NDA or BLA.

 

Post-approval studies, or Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to gain additional experience from the treatment of patients in the intended therapeutic indication and may be required by the FDA as part of the approval process.

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Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and written IND safety reports must be submitted to the FDA by the investigators for serious and unexpected adverse events or any finding from tests in laboratory animals that suggests a significant risk for human subjects. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, if at all. The FDA or the sponsor or its data safety monitoring board may suspend a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB'sIRB’s requirements or if the drug or biologic has been associated with unexpected serious harm to patients.

 

Concurrent with clinical trials, companies usually complete additional animal studies and develop additional information about the chemistry and physical characteristics of the drug or biologic as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the drug or biological candidate and, among other things, must include methods for testing the identity, strength, quality and purity of the final drug or biologic. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the drug or biological candidate does not undergo unacceptable deterioration over its shelf life.

 

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U.S. Review and Approval Processes

 

The results of product development, preclinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug or biologic, proposed labeling and other relevant information are submitted to the FDA as part of an NDA or BLA requesting approval to market the product. The submission of an NDA or BLA is subject to the payment of substantial user fees; a waiver of such fees may be obtained under certain limited circumstances.

 

The FDA reviews all NDAs and BLAs submitted before it accepts them for filing and may request additional information rather than accepting an NDA or BLA for filing. Once the submission is accepted for filing, the FDA begins an in-depth review of the NDA or BLA.

 

After the NDA or BLA submission is accepted for filing, the FDA reviews the NDA to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product'sproduct’s identity, strength, quality and purity. The FDA reviews a BLA to determine, among other things, whether the product is safe, pure and potent and the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product'sproduct’s continued safety, purity and potency. In addition to its own review, the FDA may refer applications for novel drug or biological products or drug or biological products which present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. During the approval process, the FDA also will determine whether a risk evaluation and mitigation strategy, or REMS, is necessary to assure the safe use of the drug or biologic. If the FDA concludes that a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS; the FDA will not approve the NDA or BLA without a REMS, if required.

 

Before approving an NDA or BLA, the FDA will inspect the facilities at which the product is to be manufactured. The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA or BLA, the FDA will typically inspect one or more clinical sites to assure compliance with cGMP. If the FDA determines the application, manufacturing process or manufacturing facilities are not acceptable it will outline the deficiencies in the submission and often will request additional testing or information.

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The NDA or BLA review and approval process is lengthy and difficult and the FDA may refuse to approve an NDA or BLA if the applicable regulatory criteria are not satisfied or may require additional clinical data or other data and information. Even if such data and information is submitted, the FDA may ultimately decide that the NDA or BLA does not satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive and may be susceptible to varying interpretations, which could delay, limit or prevent regulatory approval. The FDA will issue a "complete response"“complete response” letter if the agency decides not to approve the NDA or BLA. The complete response letter usually describes all of the specific deficiencies in the NDA or BLA identified by the FDA. The deficiencies identified may be minor, for example, requiring labeling changes, or major, for example, requiring additional clinical trials. Additionally, the complete response letter may include recommended actions that the applicant might take to place the application in a condition for approval. If a complete response letter is issued, the applicant may either resubmit the NDA or BLA, addressing all of the deficiencies identified in the letter, or withdraw the application.

 

If a product receives regulatory approval, the approval may be limited to specific diseases and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling. In addition, the FDA may require Phase 4 testing which involves clinical trials designed to further assess a product'sproduct’s safety and effectiveness and may require testing and surveillance programs to monitor the safety of approved products that have been commercialized.

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Orphan Drug Designation

 

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug or biological product intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than 200,000 individuals in the United States, or more than 200,000 individuals in the United States and for which there is no reasonable expectation that the cost of developing and making a drug or biological product available in the United States for this type of disease or condition will be recovered from sales of the product. Orphan product designation must be requested before submitting an NDA or BLA. After the FDA grants orphan product designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA. Orphan product designation does not convey any advantage in or shorten the duration of the regulatory review and approval process.

 

If a product that has Orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications to market the same drug or biological product for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan exclusivity. Competitors, however, may receive approval of different products for the indication for which the Orphan product has exclusivity or obtain approval for the same product but for a different indication for which the Orphan product has exclusivity. Orphan product exclusivity also could block the approval of one of our products for seven years if a competitor obtains approval of the same drug or biological product as defined by the FDA or if our drug or biological candidate is determined to be contained within the competitor'scompetitor’s product for the same indication or disease. If a drug or biological product designated as an orphan product receives marketing approval for an indication broader than what is designated, it may not be entitled to orphan product exclusivity. Orphan drugDrug status in the European Union has similar but not identical benefits in the European Union.

Expedited Development and Review Programs

 

The FDA has a Fast Track program that is intended to expedite or facilitate the process for reviewing new drug and biological products that meet certain criteria. Specifically, new drug and biological products are eligible for Fast Track designation if they are intended to treat a serious or life-threatening condition and demonstrate the potential to address unmet medical needs for the condition. Fast Track designation applies to the combination of the product and the specific indication for which it is being studied. Unique to a Fast Track product, the FDA may consider for review sections of the NDA or BLA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA or BLA, the FDA agrees to accept sections of the NDA or BLA and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the NDA or BLA.

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Any product submitted to the FDA for marketing approval, including those submitted to a Fast Track program, may also be eligible for other types of FDA programs intended to expedite development and review, such as priority review and accelerated approval. Any product is eligible for priority review if it has the potential to provide safe and effective therapy where no satisfactory alternative therapy exists or a significant improvement in the treatment, diagnosis or prevention of a disease compared with marketed products. The FDA will attempt to direct additional resources to the evaluation of an application for a new drug or biological product designated for priority review in an effort to facilitate the review. Additionally, a product may be eligible for accelerated approval. Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval, which means that they may be approved on the basis of adequate and well-controlled clinical studies establishing that the product has an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint other than survival or irreversible morbidity. As a condition of approval, the FDA generally requires that a sponsor of a drug or biological product receiving accelerated approval perform adequate and well-controlled post-marketing clinical studies to establish safety and efficacy for the approved indication. Failure to conduct such studies or conducting such studies that do not establish the required safety and efficacy may result in revocation of the original approval. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch or subsequent marketing of the product. Fast Track designation, priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process.

 

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Post-Approval Requirements

 

Any drug or biological products for which we receive FDA approvals are subject to continuing regulation by the FDA, including, among other things, record-keeping requirements, reporting of adverse experiences with the product, providing the FDA with updated safety and efficacy information on an annual basis or as required more frequently for specific events, product sampling and distribution requirements, complying with certain electronic records and signature requirements and complying with FDA promotion and advertising requirements, which include, among others, standards for direct-to-consumer advertising, prohibitions against promoting drugs and biologics for uses or in patient populations that are not described in the drug'sdrug’s or biologic'sbiologic’s approved labeling (known as "off-label use"“off-label use”), rules for conducting industry-sponsored scientific and educational activities, and promotional activities involving the internet. Failure to comply with FDA requirements can have negative consequences, including the immediate discontinuation of noncomplying materials, adverse publicity, enforcement letters from the FDA, mandated corrective advertising or communications with doctors, and civil or criminal penalties. Although physicians may prescribe legally available drugs and biologics for off-label uses, manufacturers may not market or promote such off-label uses.

 

We will need to rely, on third parties for the production of our product candidates. Manufacturers of our product candidates are required to comply with applicable FDA manufacturing requirements contained in the FDA'sFDA’s cGMP regulations. cGMP regulations require among other things, quality control and quality assurance as well as the corresponding maintenance of comprehensive records and documentation. Drug and biologic manufacturers and other entities involved in the manufacture and distribution of approved drugs and biologics are also required to register their establishments and list any products made there with the FDA and comply with related requirements in certain states, and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP and other laws. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain cGMP compliance. Discovery of problems with a product after approval may result in serious and extensive restrictions on a product, manufacturer, or holder of an approved NDA or BLA, including suspension of a product until the FDA is assured that quality standards can be met, continuing oversight of manufacturing by the FDA under a "consent“consent decree," which frequently includes the imposition of costs and continuing inspections over a period of many years, and possible withdrawal of the product from the market. In addition, changes to the manufacturing process generally require prior FDA approval before being implemented and other types of changes to the approved product, such as adding new indications and additional labeling claims, are also subject to further FDA review and approval.

 

The FDA also may require post-marketing testing, known as Phase 4 testing, risk minimization action plans and surveillance to monitor the effects of an approved product or place conditions on an approval that could otherwise restrict the distribution or use of the product.

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Employees

Employees

Our business is managed by our officers. OurThe Company’s Chairman, Terren Peizer, served as Chief Executive Officer from July 2018 and devoted his part-time efforts to the Company’s activities through April 27, 2021. On April 27, 2021, the board of directors appointed Cuong Do as Chief Executive Officer & President. Mr. Do; Wendy Kim, our Chief Financial Officer and Corporate Secretary; Jonathan Adams, began devotingwho previously served as President and Chief Operating Officer, serving as our Company’s Executive Vice President – Liver Cirrhosis Programs; and Penelope Markham, PhD, Executive Vice President - Liver Cirrhosis R&D; devote their full-time efforts to the Company activities. Chris Reading, PhD, Executive Vice President - Neuroscience R&D; and Clarence Alhem, Executive Vice President - Neuroscience Product Development began their employment with the Company on July 1,st, 2017. Our President 2021 and Secretary, Amrit Shahzad, devotes part timetheir full-time efforts to the Company’s activities. There are no additional employees. The Company reliesNeuroscience programs. We also rely on a team of highly experienced scientific, medical, and regulatory consultants to conduct its drugproduct development activities.

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ITEM 1A.RISK FACTORS

 

THE SECURITIES BEING OFFERED INVOLVE A HIGH DEGREE OF RISK AND, THEREFORE, SHOULD BE CONSIDERED EXTREMELY SPECULATIVE. THEY SHOULD NOT BE PURCHASED BY PERSONS WHO CANNOT AFFORD THE POSSIBILITY OF THE LOSS OF THE ENTIRE INVESTMENT. PROSPECTIVE INVESTORS SHOULD READ THE ENTIRE PROSPECTUS, INCLUDING ALL EXHIBITS, AND CAREFULLY CONSIDER, AMONG OTHER FACTORS THE FOLLOWING RISK FACTORS.Our business, financial condition, operating results and prospects are subject to the following risks. Additional risks and uncertainties not presently foreseeable to us may also impair our business operations. If any of the following risks or the risks described elsewhere in this report actually occurs, our business, financial condition or operating results could be materially adversely affected. In such case, the trading price of our common stock could decline, and our stockholders may lose all or part of their investment in the shares of our common stock.

This Form 10-K contains forward-looking statements that involve risks and uncertainties. These statements can be identified by the use of forward-looking terminology such as “believes,” “expects,” “intends,” “plans,” “may,” “will,” “should,” “predict” or “anticipation” or the negative thereof or other variations thereon or comparable terminology. Actual results could differ materially from those discussed in the forward- looking statements as a result of certain factors, including those set forth below and elsewhere in this Form 10-K.

Risks Relating to Our Business and Industry

We have no products approved for commercial sale, have never generated any revenues and may never achieve revenues or profitability, which could cause us to cease operations.

We have no products approved for commercial sale and, to date, we have not generated any revenue. Our ability to generate revenue depends heavily on (a) successful completion of one or more development programs demonstrating in human clinical trials that BIV201 and NE3107, our product candidates, are safe and effective; (b) our ability to seek and obtain regulatory approvals, including, without limitation, with respect to the indications we are seeking; (c) successful commercialization of our product candidates; and (d) market acceptance of our products. There are no assurances that we will achieve any of the forgoing objectives. Furthermore, our product candidates are in the development stage, and have not been fully evaluated in human clinical trials. If we do not successfully develop and commercialize our product candidates we will not achieve revenues or profitability in the foreseeable future, if at all. If we are unable to generate revenues or achieve profitability, we may be unable to continue our operations. 

We are a development stage company with a limited operating history, making it difficult for you to evaluate our business and your investment. 

BioVie Inc. (FKA NanoAntibiotics, Inc.) was incorporated on April 10, 2013. We are a development stage biopharmaceutical company with a potential therapytherapies that we have not been fully evaluated in clinical trials, and our operations are subject to all of the risks inherent in the establishment of a new business enterprise, including but not limited to the absence of an operating history, the lack of commercialized products, insufficient capital, expected substantial and continual losses for the foreseeable future, limited experience in dealing with regulatory issues, the lack of manufacturing experience and limited marketing experience, possible reliance on third parties for the development tandand commercialization of our proposed products, a competitive environment characterized by numerous, well-established and well capitalized competitors and reliance on key personnel.

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Since inception, we have not established any revenues or operations that shallwould provide financial stability in the long term, and there can be no assurance that the Companywe will realize itsour plans on itsour projected timetable in order to reach sustainable or profitable operations.

Investors are subject to all the risks incident to the creation and development of a new business and each Investorinvestor should be prepared to withstand a complete loss of his, her or its investment. Furthermore, the accompanying financial statements have been prepared assuming that the Companywe will continue as a going concern. The Company hasWe have not emerged from the development stage, and may be unable to raise further equity. These factors raise substantial doubt about itsour ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Because we are subject to these risks, you may have a difficult time evaluating our business and your investment in our Company. Our ability to become profitable depends primarily on our ability to develop drugs, to obtain approval for such drugs, and if approved, to successfully commercialize our drugs, our research and development (“R&D&D”) efforts, including the timing and cost of clinical trials; and our ability to enter into favorable alliances with third-parties who can provide substantial capabilities in clinical development, regulatory affairs, sales, marketing and distribution.

Even if we successfully develop and market our drug candidates,BIV201 and/or NE3107, we may not generate sufficient or sustainable revenue to achieve or sustain profitability, which could cause us to cease operations and cause you to lose all of your investmentinvestment.

We have no products approved for commercial sale, have never generatedIf the FDA or comparable foreign regulatory authorities approve generic versions of any revenues and may never achieve revenues or profitability, which could cause us to cease operations.

We have no products approved for commercial sale and, to date, we have not generated any revenues. Our ability to generate revenue depends heavily on (a) successful development program and thereafter demonstration in human clinical trials that BIV201, our drug candidate, is safe and effective; (b) our ability to seek and obtain regulatory approvals, including, without limitation, with respect to the indications we are seeking; (c) successful commercialization of our product candidates; and (d) market acceptancecandidates that receive marketing approval, or such authorities do not grant our products sufficient, or any, periods of exclusivity before approving generic versions of our products. Thereproducts, the sales of our products could be adversely affected.

Once a new drug application (“NDA”) is approved, the product covered thereby becomes a “reference listed drug” or RLD, in the FDA’s publication, “Approved Drug Products with Therapeutic Equivalence Evaluations,” commonly known as the Orange Book. Other manufacturers may seek approval of generic versions of reference listed drugs through submission of abbreviated new drug applications (“ANDAs”) in the United States. In support of an ANDA, a generic manufacturer need not conduct clinical trials. Rather, the applicant generally must show that its product has the same active ingredient(s), dosage form, strength, route of administration and conditions of use or labeling as the reference listed drug and that the generic version is bioequivalent to the reference listed drug, meaning it is absorbed in the body at the same rate and to the same extent as the RLD. Generic products may be significantly less costly to bring to market than the reference listed drug and companies that produce generic products are no assurances that we will achieve anygenerally able to offer them at lower prices. Moreover, generic versions of RLDs are often automatically substituted for the RLD by pharmacies when dispensing a prescription written for the RLD. Thus, following the introduction of a generic drug, a significant percentage of the forgoing objectives. Furthermore, oursales of any branded product or reference listed drug candidate is typically lost to the generic product.

The FDA may not approve an ANDA for a generic product until any applicable period of non-patent exclusivity for the reference listed drug has expired. The United States Federal Food, Drug, and Cosmetic Act (“FDCA”) provides a period of five years of non-patent exclusivity for a new drug containing a new chemical entity (“NCE”). An NCE is an active ingredient that has not previously been approved by FDA in any other NDA. Specifically, in cases where such exclusivity has been granted, an ANDA may not be submitted to the development stage, and we have not evaluated it in human clinical trials. If we do not successfully develop and commercialize ourFDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification that a patent covering the reference listed drug candidate weis either invalid or will not achieve revenuesbe infringed by the generic product, in which case the applicant may submit its application four years following approval of the reference listed drug. If an ANDA is submitted to FDA with a Paragraph IV Certification, the generic applicant must also provide a “Paragraph IV Notification” to the holder of the NDA for the RLD and to the owner of the listed patent(s) being challenged by the ANDA applicant, providing a detailed written statement of the basis for the ANDA applicant’s position that the relevant patent(s) is invalid or profitability inwould not be infringed. If the foreseeable future,patent owner brings a patent infringement lawsuit against the ANDA applicant within 45 days of the Paragraph IV Notification, FDA approval of the ANDA will be automatically stayed for 30 months, or until 7-1/2 years after the NDA approval if at all. If we are unable to generate revenuesthe generic application was filed between 4 years and 5 years after the NDA approval. Any such stay will be terminated earlier if the court rules that the patent is invalid or achieve profitability, we maywould not be unable to continue our operations. 

infringed.

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While we believe that BIV201 contains an active ingredient, terlipressin, that would be treated as an NCE by the FDA and, therefore, if it is the first terlipressin drug product to be approved, should be afforded NCE exclusivity, the FDA may disagree with that conclusion and may approve generic products after a period that is less than five years. If the FDA were to award NCE exclusivity to someone who receives approval of a terlipressin drug product before us, we believe that we could still be awarded a different type of exclusivity protection from generic competition, which is awarded when an NDA or supplemental NDA for a new use of a drug contains reports of new clinical investigations (other than bioavailability studies) conducted or sponsored by an applicant and which FDA deems to have been essential for approval of the application or supplement. Such exclusivity prevents FDA approval of a generic version of the RLD for three years from the date of the RLD approval. Manufacturers may seek to launch generic products following the expiration of any applicable marketing exclusivity period, even if we still have patent protection for our product and no 30-month stay is in effect. If we do not maintain patent protection and regulatory exclusivity for our product candidates, our business may be materially harmed.

Competition that our products may face from generic versions of our products could materially and adversely impact our future revenue, profitability and cash flows and substantially limit our ability to obtain a return on the investments we have made in those product candidates.

If we fail to obtain or maintain Orphan Drug exclusivity for BIV201, we will have to rely on other potential marketing exclusivity, and on our intellectual property rights, which may reduce the length of time that we can prevent competitors from selling generic versions of BIV201.

We have obtained two Orphan Drug Designations for BIV201 (terlipressin) in the U.S., one for the treatment of hepatorenal syndrome (received November 21, 2018) and another for treatment of ascites due to all etiologies except cancer (received September 8, 2016). Under the Orphan Drug Act, the FDA may designate a product as an Orphan Drug if it is a drug intended to treat a rare disease or condition, defined, in part, as a patient population of fewer than 200,000 in the U.S. In the EU, Orphan Drug designation may be granted to drugs intended to treat, diagnose or prevent a life-threatening or chronically debilitating disease having a prevalence of no more than five in 10,000 people in the EU, and which meet other specified criteria. The company that first obtains FDA approval for a designated Orphan Drug for the associated rare disease may receive a seven year period of marketing exclusivity during which time FDA may not approve another application for the same drug for the same orphan disease or condition. Orphan Drug Exclusivity does not prevent FDA approval of another application for the same drug for a different disease or condition, or of an application for a different drug for the same rare disease or condition. Orphan Drug exclusive marketing rights may be lost under several circumstances, including a later determination by the FDA that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug. Similar regulations are available in the EU with a ten-year period of market exclusivity.

Even though BioVie has obtained two Orphan Drug Designations for its lead product candidate, terlipressin, for treatment of ascites and for treatment of hepatorenal syndrome, and may seek other Orphan Drug Designations for BIV201, and Orphan Drug Designation for other product candidates, there is no assurance that BioVie will be the first to obtain marketing approval for any particular rare indication. Further, even though BioVie has obtained Orphan Drug Designations for its lead product candidate, or even if BioVie obtains Orphan Drug Designation for other potential product candidates, such designation may not effectively protect BioVie from competition because different drugs can be approved for the same condition and competing versions of the same drug can be approved for different conditions and potentially used off-label in the Orphan indication. Even after an Orphan Drug is approved, the FDA can subsequently approve another competing drug with the same active ingredient for the same condition for several reasons, including, if the FDA concludes that the later drug is clinically superior due to being safer or more effective or because it makes a major contribution to patient care. Orphan Drug Designation neither shortens the development time or regulatory review time of a drug, nor gives the drug any advantage in the regulatory review or approval process.

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In addition, other companies have received Orphan Drug designations for terlipressin. Mallinckrodt Hospital Products IP Limited received Orphan Drug designation in 2004 for terlipressin for the treatment of Hepatorenal Syndrome. Mallinckrodt has already filed an NDA for its product, and the FDA convened an advisory committee meeting to discuss that application in 2020. FDA then issued a complete response letter declining to approved the NDA as filed based on safety concerns. Mallinckrodt has reported that it has met twice with FDA since the complete response letter, in October 2020 and January 2021 and plans to continue to engage FDA to seek a viable path to approval. PharmaIN Corporation received Orphan Drug Designation in 2012 for PGC-C12E-terlipressin for treatment of ascites due to all etiologies except cancer. In addition, Ferring Pharmaceuticals Inc. received Orphan Drug designation in 1986 for terlipressin for the treatment of bleeding esophageal varices. If one of those or any other company with Orphan Drug Designation for the same drug as ours for the same proposed disease or condition receives FDA approval and Orphan Drug Exclusivity before our product is approved, approval of our drug(s) for the orphan indication may be blocked for seven years by the other company’s Orphan Exclusivity and they may obtain a competitive advantage even after the exclusivity period expires associated with being the first to market.

We will need to raise substantial additional capital in the future to fund our operations and we may be unable to raise such funds when needed and on acceptable terms, which could have a materially adverse effect on our business.

Developing biopharmaceutical products, including conducting pre-clinical studies and clinical trials and establishing manufacturing capabilities, requires substantial funding. AsOn June 10, 2021, the Company closed its Asset Purchase with NeurMedix, and Acuitas, which are related party affiliates, to acquire certain assets from NeurMedix and assume certain liabilities of June 30, 2017, we hadNeurMedix, in exchange for the consideration of cash and common stock of the Company. At the close the Company issued 8,361,308 shares of its common stock and made cash equivalentspayments of $2.3 million to the seller. Other related cash expenditures for expenses such as the due diligence, legal fees and the fairness opinion totaling $5,140.$4 million was also paid. These expenditures have a significant impact on the Company’s cash position and the funding of its future operations over the next 12 months, raising substantial doubt about its ability to meet its financial cash flow requirements. Additional financing will be required to fund the research and development of our product candidates. We have not generated any product revenues, and do not expect to generate any revenues until, and only if, we develop, and receive approval to sell our drugproduct candidates from the FDA and other regulatory authorities for our product candidates.

We may not have the resources to complete the development and commercialization of any of our proposed drug candidate.product candidates. We will require additional financing to further the clinical development of our drug candidate.product candidates. In the event that we cannot obtain the required financing, we will be unable to complete the development necessary to file an investigational new drug applicationNDA with the FDA for BIV201 our drug candidate.or NE3107. This will delay or require termination of research and development programs, preclinical studies and clinical trials, material characterization studies, regulatory processes, the establishment of our own laboratory or a search for third party marketing partners to market our products for us, which could have a materially adverse effect on our business.

The amount of capital we may need will depend on many factors, including the progress, timing and scope of our research and development programs, the progress, timing and scope of our preclinical studies and clinical trials, the time and cost necessary to obtain regulatory approvals, the time and cost necessary to establish our own marketing capabilities or to seek marketing partners, the time and cost necessary to respond to technological and market developments, changes made or new developments in our existing collaborative, licensing and other commercial relationships, and new collaborative, licensing and other commercial relationships that we may establish. 

Until we can generate a sufficient amount of product revenue, if ever, we expect to finance future cash needs through public or private equity offerings, debt financings, or corporate collaboration and licensing arrangements. Additional funds may not be available when we need them on terms that are acceptable to us, or at all. If adequate funds are not available, we may be required to delay, reduce the scope of, or eliminate one or more of our research or development programs or our commercialization efforts. In addition, we could be forced to discontinue product development and reduce or forego attractive business opportunities. To the extent that we raise additional funds by issuing equity securities, our stockholders may experience additional significant dilution, and debt financing, if available, may involve restrictive covenants. To the extent that we raise additional funds through collaboration and licensing arrangements, it may be necessary to relinquish some rights to our technologies or our product candidates, or grant licenses on terms that may not be favorable to us. We may seek to access the public or private capital markets whenever conditions are favorable, even if we do not have an immediate need for additional capital at that time.

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Our fixed expenses, such as rent and other contractual commitments, will likely increase in the future, as we may enter into leases for new facilities and capital equipment;equipment and/or enter into additional licenses and collaborative agreements. Therefore, if we fail to raise substantial additional capital to fund these expenses, we could be forced to cease operations, which could cause you to lose all of your investment.

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We have limited experience in drug development and may not be able to successfully develop any drugs, which would cause us to cease operations.

The Company hasWe have never successfully developed a new drug and brought it to market. Our management and clinical teams have experience in drug development but they may not be able to successfully develop any drugs. Our ability to achieve revenues and profitability in our business will depend on, among other things, our ability to develop products internally or to obtain rights to them from others on favorable terms; complete laboratory testing and human studies; obtain and maintain necessary intellectual property rights to our products; successfully complete regulatory review to obtain requisite governmental agency approvals; enter into arrangements with third parties to manufacture our products on our behalf; and enter into arrangements with third parties to provide sales and marketing functions. If we are unable to achieve these objectives we will be forced to cease operations and you will lose all of your investment.

Development of pharmaceutical products is a time-consuming process, subject to a number of factors,risks, many of which are outside of our control. Consequently, if we are unsuccessful or fail to timely develop new drugs, we could be forced to discontinue our operations.

Our lead drugproduct candidate, BIV201 (continuous infusion terlipressin), has been cleared by the US Food and Drug Administration (FDA)FDA to beginundergo testing in a mid-stage (Phase 2a)2b) clinical trial. trial for treatment of ascites. On June 24, 2021, we announced that the first patient has been enrolled in this study. If our Phase 2b study in ascites fails to generate sufficient evidence of effectiveness, or shows significant safety risks, we may not be able to continue development of the product for that proposed use. As reflected by the FDA’s complete response letter to Malllinckrodt’s new drug application (NDA) for terlipressin dosed as an intermittent IV bolus (1 or 2 mg every 6 hours) to treat hepatorenal syndrome (HRS), terlipressin may cause significant toxicity when administered this way. We believe that our continuous infusion approach to terlipressin treatment may overcome some of those safety concerns, but there can be no assurance that we will be able to demonstrate acceptable safety for BIV201 to the FDA’s satisfaction. On June 23, 2021, we announced that FDA has provided guidance on our planned Phase 3 clinical trial of BIV201 in hepatorenal syndrome-acute kidney syndrome, and that we plan to apply for a Special Protocol Assessment (SPA) to gain agreement on the key elements of the Phase 3 trial design prior to initiating the study. If FDA declines to grant an SPA for this proposed indication, we may still be able to proceed with our proposed study protocol, which will be subject to FDA’s standard review process upon submission of an NDA. We may also fail to obtain FDA clearance to proceed with the study in our proposed form.

Our new drug product candidate NE3107, which we acquired from NeurMedix in 2021, has been cleared by FDA for use in a Phase 3, randomized, double blind, placebo controlled, parallel group, multicenter study in subjects who have mild to moderate Alzheimer’s Disease. Enrollment in that trial began in August 2021, with a planned primary completion in late 2022/early 2023. Alzheimer’s Disease is a complex and still poorly understood disease. In June 2021, FDA approved the drug aducanumab for treatment of Alzheimer’s despite a strong recommendation against approval from an FDA advisory committee. That FDA approval has generated significant medical and political controversy, including a Congressional investigation, announced on June 25, 2021, into the basis for FDA’s approval decision. That investigation, other potential investigations, and negative publicity of FDA’s approval decision could adversely impact the agency’s oversight of our clinical development program, how the agency may view and act upon any NDA we may file for NE3107, and the commercial viability of NE3107 if it were to be approved and marketed.

Further development and extensive testing will be required to determine itsthe technical feasibility and commercial viability.viability of BIV201 and NE3107. Our success will depend on our ability to achieve scientific and technological advances and to translate such advances into reliable, commercially competitive drugs on a timely basis. Drugs that we may develop are not likely to be commercially available, at a minimum, for a fewseveral years, if ever. The proposed development schedules for our drug candidateproduct candidates may be affected by a variety of factors, including technological difficulties, proprietary technology of others, and changes in government regulation, many of which will not be within our control. Any delay in the development, introduction or marketing of our drugproduct candidates could result either in such drugs being marketed at a time when their cost and performance characteristics would not be competitive in the marketplace or in the shortening of their commercial lives. In light of the long-term nature of our projects and other risk factors described elsewhere in this document, we may not be able to successfully complete the development or marketing of any drugs, which could cause us to cease operations. 

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We may fail to successfully develop and commercialize our drugproduct candidate(s) if it is found to be unsafe or ineffective in clinical trials; does not receive necessary approval from the FDA or foreign regulatory agencies; fails to conform to a changing standard of care for the disease it seeks to treat; or is less effective or more expensive than current or alternative treatment methods.

Drug development failure can occur at any stage of clinical trials and as a result of many factors, and there can be no assurance that we or our collaborators will reach our anticipated clinical targets. Even if we or our collaborators complete our clinical trials, we do not know what the long-term effects of exposure to our drug candidateproduct candidates will be. Furthermore, our drug candidateproduct candidates may be used in combination with other treatments and there can be no assurance that such use will not lead to unique or unexpected safety issues. Failure to complete clinical trials or to prove that our drug candidate isproduct candidates are safe and effective would have a material adverse effect on our ability to generate revenue and could require us to reduce the scope of or discontinue our operations, which could cause you to lose all of your investment.

We face business disruption and related risks resulting from the continuing effects of the novel coronavirus 2019 (COVID-19) pandemic, which could have a material adverse effect on our business plan.

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TableThe development of Contentsour product candidates could be disrupted and materially adversely affected by the ongoing effects of the COVID-19 pandemic and the emergence of new variants of the virus. As a result of measures imposed by the governments in affected regions, businesses and schools have been suspended due to quarantines intended to contain this outbreak. We are still assessing our business plans and the impact COVID-19 may have on our ability to recruit candidates for clinical trials or to raise financing to support the development of our product candidates, but there can be no assurance that this analysis will enable us to avoid part or all of any impact from the spread of COVID-19 or its consequences, including downturns in business sentiment generally or in our sector in particular.

We have no manufacturing experience, and the failure to comply with all applicable manufacturing regulations and requirements could have a materially adverse effect on our business.

The Company hasWe have never manufactured products in the highly regulated environment of pharmaceutical manufacturing, and our team has limited experience in the manufacture of drug therapies. There are numerous regulations and requirements that must be maintained to obtain licensure and permitting required prior to the commencement of manufacturing, as well as additional requirements to continue manufacturing pharmaceutical products. We currently do not own or lease facilities currently that could be used to manufacture any products that might be developed by us, and have contracted with an experienced Contract Manufacturing Organization (“CMO”) to perform the Company, normanufacturing of our new product candidates BIV201 and NE 3107. In addition, we do wenot have the resources at this time to acquire or lease suitable facilities. If we or our CMO fail to comply with regulations, to obtain the necessary licenses and knowhow or to obtain the requisite financing in order to comply with all applicable regulations and to own or lease the required facilities in order to manufacture our products, we could be forced to cease operations, which would cause you to lose all of your investment.

In addition, the FDA and other regulatory authorities require that product candidates and drug products be manufactured according to cGMP. Any failure by our third-party manufacturers to comply with cGMP could lead to a shortage of BIV201 and NE3107. In addition, such failure could be the basis for action by the FDA to withdraw approval, if granted to us, and for other regulatory enforcement action, including Warning Letters, product seizure, injunction or other civil or criminal penalties.

BIV201 and NE3107 and any other product candidates that we develop may have to compete with other products and product candidates for access to manufacturing facilities. There are a limited number of manufacturers that operate under cGMP regulations and that are both capable of manufacturing for us and willing to do so. If we need to find another source of drug substance or drug product manufacturing for BIV201 and NE3107, we may not be able to identify, or reach agreement with, commercial-scale manufacturers on commercially reasonably terms, or at all. If we are unable to do so, we will need to develop our own commercial-scale manufacturing capabilities, which would: impact commercialization of BIV201 and NE3107 in the U.S. and other countries where it may be approved; require a capital investment by us that could be quite costly; and increase our operating expenses.

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If our existing third-party manufacturers, or the third parties that we engage in the future to manufacture a product for commercial sale or for our clinical trials, should cease to continue to do so for any reason, we likely would experience significant delays in obtaining sufficient quantities of product for us to meet commercial demand or to advance our clinical trials while we identify and qualify replacement suppliers. If for any reason we are unable to obtain adequate supplies of BIV201 or any other product candidate that we develop, or the drug substances used to manufacture it, it will be more difficult for us to compete effectively, generate revenue, and further develop our products. In addition, if we are unable to assure a sufficient quantity of the drug for patients with rare diseases or conditions, we may lose any Orphan Drug exclusivity to which the product otherwise would be entitled.

We do not currently have the sales and marketing personnel necessary to sell products, and the failure to hire and retain such staff could have a materially adverse effect on our business.

We are an early stage development Companycompany with limited resources. Even if we had products available for sale, which we currently do not, we have not secured sales and marketing staff at this early stage of operations to sell products. We cannot generate sales without sales or marketing staff and must rely on officersothers to provide any sales or marketing services until such personnel are secured, if ever. If we fail to hire and retain the requisite expertise in order to market and sell our products or fail to raise sufficient capital in order to afford to pay such sales or marketing staff, then we could be forced to cease operations and you could lose all of your investment.

Even if we were to successfully develop approvable drugs, we will not be able to sell these drugs if we or our third-party manufacturers fail to comply with manufacturing regulations, which could have a materially adverse effect on our business.

If we were to successfully develop approvable drugs, before we can begin selling these drugs, we must obtain regulatory approval of our manufacturing facility and process or the manufacturing facility and process of the third party or parties with whom we may outsource our manufacturing activities. In addition, the manufacture of our products must comply with the FDA'sFDA’s current Good Manufacturing Practices regulations, commonly known as GMP regulations. The GMP regulations govern quality control and documentation policies and procedures. Our manufacturing facilities, if any in the future, and the manufacturing facilities of our third-party manufacturers will be continually subject to inspection by the FDA and other state, local and foreign regulatory authorities, before and after product approval. We cannot guarantee that we, or any potential third-party manufacturer of our products, will be able to comply with the GMP regulations or other applicable manufacturing regulations. The failure to comply with all necessary regulations would have a materially adverse effect on our business and could force us to cease operations and you could lose all of your investment.

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We must comply with significant and complex government regulations, compliance with which may delay or prevent the commercialization of our drug candidate,product candidates, which could have a materially adverse effect on our business. 

The R&D, manufacture and marketing of drug product candidates are subject to regulation, primarily by the FDA in the United States and by comparable authorities in other countries. These national agencies and other federal, state, local and foreign entities regulate, among other things, R&D activities (including testing in animals and in humans) and the testing, manufacturing, handling, labeling, storage, record keeping, approval, advertising and promotion of the product that we are developing. Noncompliance with applicable requirements can result in various adverse consequences, including approval delays or refusals to approve drug licenses or other applications, suspension or termination of clinical investigations, revocation of approvals previously granted, warning letters, fines, criminal prosecution, recalls or seizures of products, injunctions against shipping drugs and total or partial suspension of production and/or refusal to allow a company to enter into governmental supply contracts. 

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The process of obtaining FDA approval has historically beenis costly and time consuming. Current FDA requirements for a new human drug or biological product to be marketed in the United States include:include, among other things: (a) the successful conclusion of pre-clinical laboratory and animal tests, if appropriate, to gain preliminary information on the product'sproduct’s safety; (b) filing with the FDA of an IND application to conduct human clinical trials for drugs or biologics; (c) the successful completion of adequate and well-controlled human clinical investigations to establish the safety and efficacy of the product for its recommended use; and (d) filing by a company and acceptance and approval by the FDA of a New Drug Application (NDA)NDA for a drug product or a biological license application (BLA)BLA for a biological product to allow commercial distribution of the drug or biologic. A delay in one or more of the procedural steps outlined above could be harmful to us in terms of getting our drugproduct candidates through clinical testing and to market, which could have a materially adverse effect on our business.

The FDA, reviewsclinical investigators, Data Safety Monitoring Boards, and Institutional Review Boards review the resultsongoing conduct of, theand emerging safety information from, clinical trials and may order the temporary or permanent discontinuation of clinical trials at any time if it believes the drugproduct candidate exposes clinical subjects to an unacceptable health risk. Investigational drugs used in clinical studies must be produced in compliance with current good manufacturing practice (GMP)cGMP rules pursuant to FDA regulations. 

SalesDevelopment, approval, and sales outside the United States of products that we develop will also be subject to regulatory requirements governing human clinical trials and marketing for drugs and biological products and devices. The requirements vary widely from country to country, but typically the registration and approval process takes several years and requires significant resources.

If we experience delays or discontinuations of our clinical trials by the FDA or comparable authorities in other countries, or if we fail to obtain registration or other approvals of our products or devices then we could be forced to cease our operations and you will lose all of your investment.

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Even if we are successful in developing BIV201 and NE3107, our drug candidate,product candidates, we have limited experience in conducting or supervising clinical trials that must be performed to obtain data to submit in concert with applications for approval by the FDA. The regulatory process to obtain approval for drugs for commercial sale involves numerous steps. Drugs are subjected to clinical trials that allow development of case studies to examine safety, efficacy, and other issues to ensure that sale of drugs meets the requirements set forth by various governmental agencies, including the FDA. In the event that our protocols do not meet standards set forth by the FDA, or that our data is not sufficient to allow such trials to validate our drugs in the face of such examination, we might not be able to meet the requirements that allow our drugs to be approved for sale which could have a materially adverse effect on our business.

We can provide no assurance that our drugproduct candidates will obtain regulatory approval or that the results of clinical studies will be favorable. 

The business plan we have developed for the next twelvetwenty-four months for the liver disease program is to complete the work necessary to commence the Phase 22b clinical development program for our lead new drugproduct candidate BIV201 for treatment of ascites, conduct a single pivotal Phase 3 trial of BIV201 for ascites, and commence a pivotal Phase 3 trial required for new drug approval of BIV201 for the treatment of hepatorenal syndrome-acute kidney injury (HRS-AKI), and to pursue other key milestones such as additional US Orphan Drug designations.patent issuances. For NE3107, we have initiated a potentially pivotal 18-month Phase 3 trial in Alzheimer’s Disease, plan to commence a Phase 2 study of NE3017 in Parkinson’s Disease, and commence early stage studies of NE3107 or related molecules in oncology applications. Due to our financial constraints, we maydo not have the resources necessary to complete our application. If the resultsall of our planned initialthese clinical studies. Subject to FDA guidance, we plan to commence additional Phase 2a clinical trial are satisfactory to the FDA, we will aim to proceed to a larger2 and potentially Phase 2b3 clinical trials in the US.upon receipt of a successful capital raise. There is no guarantee the FDA will approve the commencement of a Phase 2b3 trial for BIV201, and even if they do our financial constraints may prevent us from undertaking clinical trials.

The testing, marketing and manufacturing of any product for use in the United States will require approval from the FDA. We cannot predict with any certainty the amount of time necessary to obtain such FDA approval and whether any such approval will ultimately be granted. Preclinical and clinical trials may reveal that one or more products are ineffective or unsafe, in which event further development of such products could be seriously delayed or terminated. Moreover, obtaining approval for certain products may require testing on human subjects of substances whose effects on humans are not fully understood or documented. Delays in obtaining FDA or any other necessary regulatory approvals of any proposed drug and failure to receive such approvals would have an adverse effect on the drug's potential commercial success and on our business, prospects, financial condition and results of operations. In addition, it is possible that a proposed drug may be found to be ineffective or unsafe due to conditions or facts that arise after development has been completed and regulatory approvals have been obtained. In this event, we may be required to withdraw such proposed drug from the market. To the extent that our success will depend on any regulatory approvals from government authorities outside of the United States that perform roles similar to that of the FDA, uncertainties similar to those stated above will also exist and should it result in our drug candidates failing to receive regulatory approval you could lose all of your investment. 

Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information and disclosure of our trade secrets or proprietary information could compromise any competitive advantage that we have, which could have a materially adverse effect on our business.

Our success depends, in part, on our ability to protect our proprietary rights to the technologies used in our product candidates. We depend heavily upon confidentiality agreements with our officers, employees, consultants and subcontractors to maintain the proprietary nature of our technology. These measures may not afford us complete or even sufficient protection, and may not afford an adequate remedy in the event of an unauthorized disclosure of confidential information. If we fail to protect and/or maintain our intellectual property, third parties may be able to compete more effectively against us, we may lose our technological or competitive advantage, and/or we may incur substantial litigation costs in our attempts to recover or restrict use of our intellectual property. In addition, others may independently develop technology similar to ours, otherwise avoiding the confidentiality agreements, or produce patents that would materially and adversely affect our business, prospects, financial condition and results of operations, in which event and you could lose all of your investment. 

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We may be unable to obtain or protect intellectual property rights relating to our products,product candidates, and we may be liable for infringing upon the intellectual property rights of others, which could have a materially adverse effect on our business. 

Our ability to compete effectively will depend on our ability to maintain the proprietary nature of our technologies. In 2017 the US PatentWe cannot assure investors that we will continue to innovate and Trademark Office issued afile new patent covering the Company’s lead drug candidate BIV201 for use in ascites patients administered by an ambulatory pump. There can be no assuranceapplications, or that if filed any future patent applications we have filed will ultimately result in the issuance of a patentgranted patents with respect to the technology owned by us or licensed to us. Further, we cannot predict how long it will take for such patents to issue, if at all. The patent position of pharmaceutical or biotechnology companies, including ours, is generally uncertain and involves complex legal and factual considerations. considerations and, therefore, validity and enforceability cannot be predicted with certainty. Patents may be challenged, deemed unenforceable, invalidated or circumvented. For example, on November 13, 2019, the Patent Trial and Appeal Board of the United States Patent and Trademark Office (the “PTAB”) issued a written decision in the inter partes review action that was brought by Mallinckrodt Pharmaceuticals Ireland Limited (“Mallinckrodt”) against us. In that action, Mallinckrodt sought to invalidate our previously-issued patent (U.S. Pat. No. 9,655,945, “Treatment of Ascites”) (the “’945 Patent”). In its decision, the PTAB determined that all claims of the ’945 Patent were not patentable because they were either anticipated or obvious in light of prior art. The PTAB also denied our Motion to Amend the claims on similar grounds. The result of the PTAB’s decision is that the ’945 patent is no longer valid or enforceable.

In April 2020, we elected certain claims in our pending U.S. patent application 16/379,446 (a continuation application related to the ’945 Patent) that we believe are defensible in light of the IPR challenge described above. BioVie has also filed a PCT (“Patent Cooperation Treaty”) application covering our novel liquid formulations of terlipressin (international patent application PCT/US2020/034269 published as WO2020/237170) and we will seek patent protection in at least the United States, Europe, China and Japan. We also have fifteen (15) issued U.S. patents one (1) pending U.S. application and one (1) pending U.S. provisional application (provisional application filed May 18, 2021) directed to our newly acquired drug candidates, including NE3107. However, there can be no assurance that our pending patent applications will result in issued patents, or that any issued patent claims from pending or future patent applications will be sufficiently broad to protect BIV201, NE3107, or any other product candidates or to provide us with competitive advantages.

Any patents we do obtain may be challenged by re-examination or otherwise invalidated or eventually found unenforceable. Both the patent application process and the process of managing patent disputes can be time consuming and expensive. If we were to initiate legal proceedings against a third party to enforce a patent related to one of our products, the defendant in such litigation could counterclaim that our patent is invalid and/or unenforceable. In patent litigation in the U.S., defendant counterclaims alleging invalidity and/or unenforceability are commonplace, as are validity challenges by the defendant against the subject patent or other patents before the USPTO. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement, failure to meet the written description requirement, indefiniteness, and/or failure to claim patent eligible subject matter. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent intentionally withheld material information from the USPTO, or made a misleading statement, during prosecution. Additional grounds for an unenforceability assertion include an allegation of misuse or anticompetitive use of patent rights, and an allegation of incorrect inventorship with deceptive intent. Third parties may also raise similar claims before the USPTO even outside the context of litigation. The outcome is unpredictable following legal assertions of invalidity and unenforceability. With respect to the validity question, for example, we cannot be certain that no invalidating prior art existed of which we and the patent examiner were unaware during prosecution. These assertions may also be based on information known to us or the Patent Office. If a defendant or third party were to prevail on a legal assertion of invalidity and/or unenforceability, we would lose at least part, and perhaps all, of the claims of the challenged patent. Such a loss of patent protection would or could have a material adverse impact on our business.

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The standards that the United States Patent and Trademark Office (and foreign countries) use to grant patents are not always applied predictably or uniformly and can change. There is also no uniform, worldwide policy regarding the subject matter and scope of claims granted or allowable in pharmaceutical or biotechnology patents. Accordingly, we do not know the degree of future protection for our proprietary rights or the breadth of claims that will be allowed in any patents issued to us or to others.

Further, we rely on a combination of trade secrets, know-how, technology and nondisclosure, and other contractual agreements and technical measures to protect our rights in the technology. If any trade secret, know-how or other technology not protected by a patent were to be disclosed to or independently developed by a competitor, our business and financial condition could be materially adversely affected. The laws of some foreign countries do not protect our proprietary rights to the same extent as the laws of the U.S., and we may encounter significant problems in protecting our proprietary rights in these countries.

We do not believe that either BIV201 or NE3107, the drug candidateproduct candidates we are currently developing, infringesinfringe upon the rights of any third parties nor are they infringed upon by third parties. However, there can be no assurance that our technology will not be found in the future to infringe upon the rights of others or be infringed upon by others. Moreover, patent applications are in some cases maintained in secrecy until patents are issued. The publication of discoveries in the scientific or patent literature frequently occurs substantially later than the date on which the underlying discoveries were made and patent applications were filed. Because patents can take many years to issue, there may be currently pending applications of which we are unaware that may later result in issued patents that our products or product candidates infringe. For example, pending applications may exist that provide support or can be amended to provide support for a claim that results in an issued patent that our product infringes. In such a case, others may assert infringement claims against us, and should we be found to infringe upon their patents, or otherwise impermissibly utilize their intellectual property, we might be forced to pay damages, potentially including treble damages, if we are found to have willfully infringed on such parties'parties’ patent rights. In addition to any damages we might have to pay, we may be required to obtain licenses from the holders of this intellectual property, enter into royalty agreements,property. We may fail to obtain any of these licenses or redesign our drug candidates so as not to utilize this intellectual property eachrights on commercially reasonable terms. Even if we are able to obtain a license, it may be non-exclusive, thereby giving our competitors access to the same technologies licensed to us. In that event, we may be required to expend significant time and resources to develop or license replacement technology. If we are unable to do so, we may be unable to develop or commercialize the affected products, which could materially harm our business and the third parties owning such intellectual property rights could seek either an injunction prohibiting our sales, or, with respect to our sales, an obligation on our part to pay royalties and/or other forms of which may prove to be uneconomical or otherwise impossible.compensation. Conversely, we may not always be able to successfully pursue our claims against others that infringe upon our technology. Thus, the proprietary nature of our technology or technology licensed by us may not provide adequate protection against competitors. 

The pharmaceutical industry is characterized by extensive litigation regarding patents and other intellectual property rights. Moreover, the cost to us of any litigation or other proceeding relating to our patents and other intellectual property rights, even if resolved in our favor, could be substantial, and the litigation would divert our management'smanagement’s efforts. We may not have sufficient resources to bring any such action to a successful conclusion. Uncertainties resulting from the initiation and continuation of any litigation could limit our ability to continue our operations and you could lose all of your investment. 

We depend upon our management and their loss or unavailability could put us at a competitive disadvantage which could have a material adverse effect on our business.

We currently depend upon the efforts and abilities of our executive management team of Jonathan Adams,Cuong Do, our Chief Executive Officer and& President; Wendy Kim, our Chief Financial Officer; Penelope Markham, Executive Vice President – Cirrhosis R7D; Officer, Jonathan Adams, our Executive Vice President – Cirrohoisis Programs, Chris Reading, our Executive Vice President of Neuroscience R&D and Amrit Shahzad,Mr. Clarence Ahlem, our Executive Vice President and Secretary. Mr. Adams servesProduct Development who all serve the Company full-time and Ms. Shahzad serves the Company part-time.full-time. The loss or unavailability of the services of eitherany of these individuals for any significant period of time could have a material adverse effect on our business, prospects, financial condition and results of operations which may cause you to lose all of your investment. We have not obtained, do not own, nor are we the beneficiary of key-person life insurance. 

 -15--23-

We may not be able to attract and retain highly skilled personnel, which could have a materially adverse effect on our business.

Our ability to attract and retain highly skilled personnel is critical to our operations and expansion. We face competition for these types of personnel from other pharmaceutical companies and more established organizations, many of which have significantly larger operations and greater financial, technical, human and other resources than us. We may not be successful in attracting and retaining qualified personnel on a timely basis, on competitive terms, or at all. If we are not successful in attracting and retaining these personnel, our business, prospects, financial condition and results of operations will be materially and adversely affected.

The biotechnology and biopharmaceutical industries are characterized by rapid technological developments and a high degree of competition. We may be unable to compete with enterprises equipped with more substantial resources than us, which could cause us to curtail or cease operations.

The biotechnology and biopharmaceutical industries are characterized by rapid technological developments and a high degree of competition based primarily on scientific and technological factors. These factors include the availability of patent and other protection for technology and products, the ability to commercialize technological developments and the ability to obtain government approval for testing, manufacturing and marketing.

We compete with biopharmaceutical firms in the United States, Europe and elsewhere, as well as a growing number of large pharmaceutical companies that are applying biotechnology to their operations. Many biopharmaceutical companies have focused their development efforts in the human therapeutics area. Many major pharmaceutical companies have developed or acquired internal biotechnology capabilities or made commercial arrangements with other biopharmaceutical companies. These companies, as well as academic institutions, government agencies and private research organizations, also compete with us in recruiting and retaining highly qualified scientific personnel and consultants. Our ability to compete successfully with other companies in the pharmaceutical field will also depend to a considerable degree on the continuing availability of capital to us. 

Although there are not currently any therapies approved by the FDA specifically for the treatment of ascites due to liver cirrhosis, the Companywe still facesface significant competitive and market risk. Other companies, such as Mallinckrodt Inc., are developing therapies for severe complications of advanced liver cirrhosis, which may in the future be developed for the treatment of ascites, and these therapies could compete indirectly or directly with our drugproduct candidate. Similarly, other companies, such as Biogen and Eli Lilly, are developing treatments for Alzheimer’s Disease and Parkinson’s Disease, which could compete indirectly or directly with our product candidate. There may be other competitive development programs of which we are unaware. Even if our drug candidate isproduct candidates are ultimately approved by the FDA, there is no guarantee that once it is on the market doctors will adopt itthem in favor of current ascites treatment procedures such as diuretics and paracentesis.paracentesis with respect to BIV201 and Alzheimer’s Disease and Parkinson’s Disease with respect to NE3107. These competitive and market risks could have a material adverse effect on our business, prospects, financial condition and results of operations which may cause you to lose all of your investment.

Our competition will be determined in part by the potential indications for which drugs are developed and ultimately approved by regulatory authorities. Additionally, the timing of the market introduction of some of our potential drugproduct candidate or of competitors'competitors’ products may be an important competitive factor. Accordingly, the relative speed with which we can develop drugs, complete pre-clinical testing, clinical trials, approval processes and supply commercial quantities to market are important competitive factors. We expect that competition among drugs approved for sale will be based on various factors, including product efficacy, safety, reliability, availability, price and patent protection. 

The successful development of biopharmaceuticals is highly uncertain. A variety of factors including, pre-clinical study results or regulatory approvals, could cause us to abandon the development of our drugproduct candidates.

 -16--24-

Successful development of biopharmaceuticals is highly uncertain and is dependent on numerous factors, many of which are beyond our control.

ProductsProduct candidates that appear promising in the early phases of development may fail to reach the market for several reasons. Pre-clinical study results may show the product candidate to be less effective than desired (e.g., the study failed to meet its primary objectives)endpoints) or to have harmful or problematic side effects. ProductsProduct candidates may fail to receive the necessary regulatory approvals or may be delayed in receiving such approvals. Among other things, such delays may be caused by slow enrollment in clinical studies, length of time to achieve study endpoints, additional time requirements for data analysis or a IND and later NDA, preparation, discussions with the FDA, an FDA request for additional pre-clinical or clinical data or unexpected safety or manufacturing issues; manufacturing costs, pricing or reimbursement issues, or other factors that make the product not economical. Proprietary rights of others and their competing products and technologies may also prevent the product from being commercialized.

Success in pre-clinical and early clinical studies does not ensure that large-scale clinical studies will be successful. Clinical results are frequently susceptible to varying interpretations that may delay, limit or prevent regulatory approvals. The length of time necessary to complete clinical studies and to submit an application for marketing approval for a final decision by a regulatory authority varies significantly from one product to the next, and may be difficult to predict. There can be no assurance that any of our products will develop successfully, and the failure to develop our products will have a materially adverse effect on our business and will cause you to lose all of your investment.

There may be conflicts of interest among our officers, directors and stockholders.

Certain of our executive officers and directors and their affiliates are engaged in other activities and have interests in other entities on their own behalf or on behalf of other persons. Neither we nor any of our shareholders will have any rights in these ventures or their income or profits. In particular, our executive officers or directors or their affiliates may have an economic interest in or other business relationship with partner companies that invest in us or are engaged in competing drug development. Our executive officers or directors may have conflicting fiduciary duties to us and third parties. The terms of transactions with third parties may not be subject to arm'sarm’s length negotiations and therefore may be on terms less favorable to us than those that could be procured through arm'sarm’s length negotiations. Although the Company is not awarewe have established an audit committee comprised solely of any conflict that has arisenindependent directors to date,oversee transactions between us and our insiders, we do not have any policyformal policies in place to deal with such conflicting fiduciary duties should such a conflict arise.

We may enter into employment agreements with our executive officers and compensation payable thereunderIf we fail to maintain an effective system of internal controls, we may not be basedable to accurately report our financial results or detect fraud. Consequently, investors could lose confidence in our financial reporting and this may decrease the trading price of our common stock.

We must maintain effective internal controls to provide reliable financial reports and detect fraud. We have concluded that our disclosure controls and procedures internal controls, as well as internal controls over financial reporting, are effective. Failure to implement changes to our internal controls or any others that we identify as necessary to establish an effective system of internal controls could harm our operating results and cause investors to lose confidence in our reported financial information. Any such loss of confidence would have a negative effect on arms-length negotiations.the trading price of our common stock.

The Company’s current executive officers also serve as directors of the Company, and the Company does not have an independent compensation committee to determine compensation and to approve employment agreements. Therefore, compensation which may be paid by the Company to its management may not be determined based on arms-length negotiations. The Company may grant stock options and other equity incentives to its executive officers and directors that are consistent with the nature of the pharmaceutical industry. There can be no assurance made that the consideration which may be payable to management will reflect the true market value of services provided to the Company.

 -17-

RISKS RELATING TO OUR COMMON STOCK

There is a risk of dilution of your percentage ownership of Common Stockcommon stock in the Company.

The Company hasWe have the right to raise additional capital or incur borrowings from third parties to finance itsour business. The CompanyWe may also implement public or private mergers, business combinations, business acquisitions and similar transactions pursuant to which itwe would issue substantial additional capital stock to outside parties, causing substantial dilution in the ownership of the Company by itsour existing stockholders. Our Board of Directors has the authority, without the consent of any of the stockholders, to cause the Companyus to issue more shares of Common Stockcommon stock and/or preferred stock at such price and on such terms and conditions as are determined by the Board of Directors in its sole discretion. As of August 17, 2021, there were warrants outstanding to purchase an aggregate of 158,761 shares of common stock at exercise prices ranging from $1.88 to $75.00 per share. The issuance of additional shares of capital stock by the Companyus will dilute your ownership percentage in the Company and could impair our ability to raise capital in the future through the sale of equity securities.

-25-

Certain stockholders who are also officers and directors of the Company may have significant control over our management.

TheOur directors and executive officers of the Company currently own an aggregate 10,607,93319,793,477 shares of our common stock, which currently constitutes 11.5%79.7% of the Common Stock of the Company.our issued and outstanding common stock. As a result, directors and executive officers may have a significant influence on theour affairs and management, of the Company, as well as on all matters requiring member approval, including electing and removing members of the Company’sour Board of Directors, causing the Companyus to engage in transactions with affiliated entities, causing or restricting theour sale or merger, of the Company, and certain other matters. Our Chairman, Mr. Terren Peizer, may be deemed to beneficially own the shares held by Acuitas. Such concentration of ownership and control could have the effect of delaying, deferring or preventing a change in control of the Companyus even when such a change of control would be in the best interests of the Company’sour stockholders.

There is very little liquidity in our Common Stock and we may not be successful at obtaining a quotation on a recognized quotation service. In such event it may be difficult for you to sell your shares.

The OTC Bulletin Board and similar quotation services are often characterized by low trading volumes, and price volatility, which may make it difficult for an investor to sell our Common Stock on acceptable terms. If trades in our Common Stock are not quoted on a quotation facility, it may be very difficult for an investor to find a buyer for their shares in our Company.

Our Common Stock is subject to the “penny stock” rules of the SEC and the trading market in our securities is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment in our stock.

Under U.S. federal securities legislation, our Common Stock will constitute “penny stock”. Penny stock is any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor’s account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor’s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Securities and Exchange Commission relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

 -18-

We may, in the future, issue additional common stock, which would reduce investors’ percent of ownership and may dilute our share value.

OurAs of August 17, 2021, our Articles of Incorporation authorize the issuance of 300,000,000800,000,000 shares of Common Stock.common stock. As of June 30, 2017, the CompanyAugust 17, 2021 we had 91,925,00024,833,324 shares of Common Stockcommon stock outstanding. Accordingly, we may issue up to an additional 208,075,000775,166,676 shares of Common Stock.common stock. The future issuance of Common Stockcommon stock may result in substantial dilution in the percentage of our Common Stockcommon stock held by our then existing shareholders. We may value any Common Stockcommon stock in the future on an arbitrary basis. The issuance of Common Stockcommon stock for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by our investors, might have an adverse effect on any trading market for our Common Stockcommon stock and could impair our ability to raise capital in the future through the sale of equity securities.

The market price and trading volume of our common stock may be volatile.

The market price and trading volume of our common stock has been volatile. We expect that the market price of our common stock will continue to fluctuate significantly for many reasons, including in response to the risk factors described in this prospectus or for reasons unrelated to our specific performance. In recent years, the stock market has experienced extreme price and volume fluctuations. This volatility has affected the market prices of securities issued by many companies for reasons unrelated to their operating performance and may adversely affect the market price and trading volume of our common stock. Prices for our common stock may also be influenced by the depth and liquidity of the market for our common stock, investor perceptions about us and our business, our future financial results, the absence of cash dividends on our common stock and general economic and market conditions. In the past, securities class action litigation has often been instituted against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and could divert our management and other resources.       

We have a large number of restricted shares outstanding, a portion of which may be sold under Rule 144 which may reduce the market price of our shares.

Of the 91,925,00024,833,324 shares of Common Stock currentlycommon stock issued and outstanding and assuming no Warrants are exercised, 81,317,067as of August 17, 2021, 5,039,847 shares are held by non-affiliates and 10,607,93319,793,477 are owned by affiliates of the Company, consisting of our officers and directors and a large shareholder.or entities controlled by them. The majority of our Common Stock,common stock, including all of the Affiliates’affiliates’ securities are deemed “restricted securities” within the meaning of Rule 144 as promulgated under the Securities Act.

It is anticipated that all of the “restricted securities” will be eligible for resale under Rule 144. In general, under Rule 144, subject to the satisfaction of certain other conditions, a person, who is not an affiliate (and who has not been an affiliate for a period of at least three months immediately preceding the sale) and who has beneficially owned restricted shares of our common stock for at least six months is permitted to sell such shares without restriction, provided that there is sufficient public information about us as contemplated by Rule 144. An affiliate who has beneficially owned restricted shares of our common stock for a period of at least one year may sell a number of shares equal to one percent of our issued and outstanding common stock approximately every three months.

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Any failure to maintain effective internal control over financial reporting could harm us.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”). Under standards established by the Public Company Accounting Oversight Board (“PCAOB”), a deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or personnel, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. The respective holding periods for the shares issued to affiliates and non-affiliates holding restricted securities commenced and were issued between May 17, 2013 and June 30, 2013. ThePCAOB defines a material weakness as a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that substantial amountsa material misstatement of annual or interim financial statements will not be prevented, or detected and corrected, on a timely basis.

If we are unable to assert that our Common Stock may be sold under Rule 144 into the public market may adversely affect prevailing market prices for the Common Stock and could impair our ability to raise capitalinternal control over financial reporting is effective, or when required in the future, throughif our independent registered public accounting firm is unable to express an unqualified opinion as to the saleeffectiveness of equity securities.our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could be adversely affected and we could become subject to litigation or investigations by the stock exchange on which our securities are listed, the SEC or other regulatory authorities, which could require additional financial and management resources.

The lack of public company experience of our management team could adversely impact our ability to comply with the reporting requirements of U.S. securities laws, which could have a materially adverse effect on our business.

Our officers have limited public company experience, which could impair our ability to comply with legal and regulatory requirements such as those imposed by Sarbanes-Oxley Act of 2002. Our officers and directors have never been responsible for managing a publicly traded company. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Any such deficiencies, weaknesses or lack of compliance could have a materially adverse effect on our ability to comply with the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which is necessary to maintain our public company status. If we were to fail to fulfill those obligations, our ability to continue as a U.S. public company would be in jeopardy in which event you could lose your entire investment in our Company.

 -19-

The Company isWe are considered a smaller reporting company and is exempt from certain disclosure requirements, which could make our stock less attractive to potential investors.

Rule 12b-2 of the Exchange Act defines a “smaller reporting company” as an issuer that is not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent that is not a smaller reporting company and that:

·Had a public float of less than $75$250 million as of the last business day of its most recently completed second fiscal quarter, computed by multiplying the aggregate number of worldwide number of shares of its voting and non-voting common equity held by non-affiliates by the price at which the common equity was last sold, or the average of the bid and asked prices of common equity, in the principalprinciple market for the common equity; or

·In the case of an initial registration statement under the Securities Act or the Exchange Act for shares of its common equity, had a public float of less than $75$250 million as of a date within 30 days of the date of the filing of the registration statement, computed by multiplying the aggregate worldwide number of such shares held by non-affiliates before the registration plus, in the case of a Securities Act registration statement, the number of such shares included in the registration statement by the estimated public offering price of the shares; or

-27-

·In the case of an issuer whosewho had annual revenue of less than $100 million during the most recently completed fiscal year for which audit financial statements are available, had a public float as calculated under paragraph (1) or (2) of this definition that was either zero had annual revenues ofor less than $50 million during the most recently completed fiscal year for which audited financial statements are available.$700 million.

 

As a “smaller reporting company” (in addition to and without regard to our status as an “emerging growth company”) we are not required and may not include a Compensation Discussion and Analysis ("(“CD&A"&A”) section in our proxy statements; we provide only 3 years of business development information; provide fewer years of selected financial data; and have other “scaled” disclosure requirements that are less comprehensive than issuers that are not “smaller reporting companies” which could make our stock less attractive to potential investors, which could make it more difficult for you to sell your shares.

The Company is considered an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Common Stock less attractive to investors.

We are an “emerging growth company,” as definedhave not held regular annual meetings of stockholders in the Jumpstartpast, and if we are required by the Nevada District Court to hold an annual meeting pursuant to Nevada Revised Statutes §78.345(1), it could result in the unanticipated expenditure of funds, time and other Company resources.

Section 1 of Article II of our Business Startups Actbylaws provides that an annual meeting of 2012,stockholders shall be held each year on a date and weat a time designated by our Board of Directors. Section 78.345(1) of the Nevada Revised Statutes provides that if there is a failure to hold the annual meeting for a period of 18 months after the last election of directors, stockholders owning at least 15% of the voting power of the outstanding common stock may take advantageapply to the Nevada district court to order the election of certain exemptions from various reporting requirements that are applicabledirectors.

We have not held regular annual meetings of stockholders in the past because a substantial majority of our stock is owned by a small number of stockholders, making it easy to other public companies, including, but not limitedobtain written consent in lieu of a meeting when necessary. In light of our historical liquidity constraints, handling matters by written consent has allowed us to not beingsave on financial and administrative resources required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reportsprepare for and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

 -20-

We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (A) following the fifth anniversary of our first sale of common equity securities pursuant to an effective registration statement, (B) in which we have totalhold such annual gross revenue of at least $1.0 billion, or (C) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value ofmeetings. Additionally, our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, and (ii) the datewarrants have been approved for listing on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

We cannot predict if investors will find our Common Stock less attractive becauseNasdaq. Pursuant to Nasdaq’s corporate governance requirements, we will rely on these exemptions. If some investors findbe obligated to hold regular annual meetings of stockholders in the future, and it is currently contemplated that we will hold such meeting later in 2021.

To our Common Stock less attractive asknowledge, no stockholder or director has requested our management to hold such an annual meeting and no stockholder or director has applied to the Nevada district court seeking an order directing us to hold a meeting of stockholders. However, if one or more stockholders or directors were to apply to the Nevada district court seeking such an order, and if the Nevada district court were to order an annual meeting before we were prepared to hold one, the preparation for the annual meeting of stockholders and the meeting itself could result there may be a less active trading market for our Common Stockin the unanticipated expenditure of funds, time, and our stock price may be more volatile when trading occurs.other Company resources.

We intend to becomeare subject to the periodic reporting requirements of the Exchange Act, which will require us to incur audit fees and legal fees in connection with the preparation of such reports. These additional costs will negatively affect our ability to earn a profit.

Following the effective date of the registration statement in which this prospectus is included, we will beWe are required to file periodic reports with the Securities and Exchange CommissionSEC pursuant to the Exchange Act and the rules and regulations thereunder. In order to comply with such requirements, our independent registered auditors will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will havehas to review and assist in the preparation of such reports. Factors such as the number and type of transactions that we engage in and the complexity of our reports cannot accurately be determined at this time and may have a major negative effect on the cost and amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will beis an expense to our operations and thus havehas a negative effect on our ability to meet our overhead requirements and earn a profit.

However, for as long as we remain an “emerging growth company” we intend to take advantage of certain exemptions from various reporting requirements until we are no longer an “emerging growth company.”

We also qualify as a smaller reporting company, and so long as we remain a smaller reporting company, we benefit from the same exemptions and exclusions as an emerging growth company. In the event that we cease to be an emerging growth company as a result of a lapse of the five-year period, but continue to be a smaller reporting company, we would continue to be subject to the exemptions available to emerging growth companies until such time as we were no longer a smaller reporting company.

After, and if ever, we are no longer an “emerging growth company,” we expect to incur significant additional expenses and devote substantial management effort toward ensuring compliance with those requirements applicable to companies that are not “emerging growth companies,” including Section 404 of the Sarbanes-Oxley Act.

 -21-

The JOBS Act allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies, which means that our financial statements may not be comparable to companies that comply with public company effective dates, which could make our Common Stock less attractive to investors.

Since we have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act, this election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

Because we do not intend to pay any cash dividends on our common stock, our stockholders will not be able to receive a return on their shares unless they sell them.

We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them. There is no assurance that stockholders will be able to sell shares when desired.

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ITEM 1B.UNRESOLVED STAFF COMMENTS

 

None.

ITEM 2.DESCRIPTION OF PROPERTYPROPERTIES

 

On JanuaryOctober 1, 2014,2018, the companyCompany executed a lease agreement with Cummings PropertiesAcuitas Group Holdings, LLC (related party) for the company’sCompany’s corporate office of 270 square feetspace at 100 Cummings Center, Suite 247-C, Beverly, MA 01915.2120 Colorado Avenue, Santa Monica, CA 90404. The lease is for a term of five years from January 1, 2014 to Decembermonth-to-month lease that may be cancelled upon 30 2018days’ written notice and requires monthly payments of $357 ($4,284 annually for each$1,000.

On July 1, 2021, the Company assumed NeurMedix lease at 6165 Greewich Dr Suite 150, San Diego, CA 92122. The lease agreement requires monthly payments of the five years, total aggregate of $21,420).$8,782.

ITEM 3.LEGAL PROCEEDINGS

 

To our knowledge, neither the Company nor any of our officers or directors is a party to any material legal proceeding or litigation and such persons know of no material legal proceeding or contemplated or threatened litigation.litigation, other than as described below. There are no judgments against us or our officers or directors. None of our officers or directors has been convicted of a felony or misdemeanor relating to securities or performance in corporate office.

ITEM 4.MINE SAFETY DISLCOSUREDISCLOSURES

 

None

None.

 -22--29-

PART II

ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 

The Company’s Common Stock trades onUnregistered Sales of Securities

All sales of unregistered securities during the over-the-counter market on the National Association of Securities Dealers, Inc. OTC Bulletin Board System (“OTCBB”) under the symbol “BIVI.” The following table sets forth the range of high and low closing bid quotations of the Common Stock as reported by the OTCBB for each fiscal quarter for the yearsyear ended June 30, 2017 and 2016. High and low bid quotations reflect inter-dealer prices without adjustment for retail mark-ups, markdowns2021 were previously disclosed in a Quarterly Report on Form 10-Q or commissions and may not necessarily represent actual transactions.Current report on Form 8-K.

  Bid Prices
  Low High
 Quarter ended June 30, 2017  $0.21  $0.45 
 Quarter ended March 31, 2017  $0.16  $0.40 
 Quarter ended December 31, 2016  $0.16  $0.45 
 Quarter September 30, 2016  $0.21  $0.40 

On June 30, 2017, the closing bid priceIssuer Purchases of the Company’s Common Stock as reported by the OTC was $0.29 and there were approximately 97 shareholders of record.

DIVIDENDS

We have not paid any cash dividends on our common or preferred stock and do not anticipate paying any such cash dividends in the foreseeable future. Earnings, if any, will be retained to finance future growth. We may issue shares of our common stock and preferred stock in private or public offerings to obtain financing, capital or to acquire other businesses that can improve our performance and growth. Issuance and or sales of substantial amounts of common stock could adversely affect prevailing market prices in our common stock.

Common Stock

During the year ended June 30, 2017,2021, there waswere no modificationissuer repurchases of any instruments issued herein for the fourth quarter, defining the rightsshares of holders of the Company’s common stock and no limitation or qualification of the rights evidenced by the Company’s common stock as a result of the issuance of any other class of securities or the modification thereof.stock.

The Company recognizes all share-based payments to employees, including grants of employee stock options, as compensation expense in the financial statements based on their fair values. That expense will be recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

ITEM 6.SELECTED FINANCIAL DATA[Reserved]

Not Required

 -23-

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

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 our; research and development activities, distributor channel; compliance with regulatory impositions; 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.

All statements other than statements of historical fact are statements that could be deemed forward-looking statements. The Company assumes no obligation and does not intend to update these forward-looking statements, except as required by law. When used in this report, the terms “BioVie”, “Company”, “we”, “our”, and “us” refer to BioVie Inc.

The following discussion of the Company’s financial condition and the results of operations should be read in conjunction with the Financial Statements and Notes thereto appearing elsewhere in this document.report.

The Private Securities Litigation Reform Act of 1995 providesOverview

BioVie Inc. is a safe harborclinical-stage company developing innovative drug therapies to overcome unmet medical needs in chronic debilitating conditions.

In liver disease, our Orphan Drug candidate BIV201 (continuous infusion terlipressin) is being developed as a future treatment option for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that in addition to the description of historical facts contained herein, this report contains certain forward-looking statements that involve riskspatients suffering from ascites and uncertainties as detailed herein and from time to time in the Company’s other filings with the Securities and Exchange Commission and elsewhere. Such statements are based on management’s current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those, described in the forward-looking statements. These factors include, among others: (a) the Company’s fluctuations in sales and operating results; (b) risks associated with international operations; (c) regulatory, competitive and contractual risks; (d) product development risks; (e) the ability to achieve strategic initiatives, including but not limited to the ability to achieve sales growth across the business segments through a combination of enhanced sales force, new products, and customer service; and (f) pending litigation.

 -24-

Management’s Discussion

We are a clinical stage biotechnology company engaged in the discovery, development and commercialization of therapies targeting life-threatening complications of liver cirrhosis. Our initial disease target is ascites, a serious medical condition affecting about 100,000 Americans and many times more worldwide. Our therapeutic drug candidate BIV201 is based on a drug that is approved in about 40 countries to treat related complications ofadvanced liver cirrhosis (part of the same disease pathway as ascites), but not yet available in the US.caused by NASH, hepatitis, and alcoholism. The active agent in BIV201, terlipressin, is a potent vasoconstrictor which is in use for various medical conditions around the world. The goal isinitial target for BIV201 therapy is refractory ascites. These patients suffer from frequent life-threatening complications, generate more than $5 billion in annual treatment costs, and have an estimated 50% mortality rate within 6 to interrupt the ascites disease pathway, thereby halting the cycle of accelerating fluid generation in ascites patients.

BioVie accomplished the following key milestones during the twelve months ended June 30th, 2017:

- In August 2016, the Company changed its name from NanoAntibiotics, Inc. to BioVie Inc.

- In August 2016, the Company engaged Patrick Yeramian MD as our medical director to lead the clinical team.

- In September 2016, the Company’s lead compound BIV201 was granted an Orphan-drug designation by the12 months. The US Food and Drug Administration (FDA) for the treatment of ascites duehas never approved any drugs to liver cirrhosis.

- In November 2016, the Company submitted an Investigational New Drug (IND) application for BIV201 for the treatment oftreat refractory ascites due to liver cirrhosis.

- In December 2017, the Company announced that healthcare executive Jim Lang joined the Board of Directors and purchased company stock.

- In January 2017, the Company entered into a Common Stock Purchase Agreement with Aspire Capital Fund for up to $12 million.

- In March 2017, the Company up-listed to the OTCQB stock market.

- In March 2017, the Company announced that Julie G. Anderson, a successful pharmaceutical marketing and business executive, joined the Board of Directors and purchased company stock.

- In March 2017, BioVie received notification from the US FDA allowing it to commence a mid-stage (Phase 2a) clinical trial for its Orphan drug candidate BIV201.

- In May 2017, the Company announced that Dr. Hari Kumar, an accomplished biopharmaceutical industry executive, joined its Board of Directors and purchased company stock.

- In May 2017, the Company announced the issuance of its core US patent covering BIV201 therapy for the treatment of ascites due to liver cirrhosis.

- In June 2017, the Company received Institutional Review Board (IRB) approval to begin aascites. A Phase 2a clinical trial of BIV201 was completed in 2019, and a multi-center, randomized and controlled Phase 2b trial is currently underway at several US medical centers including Vanderbilt University, the McGuire Research InstituteMayo Clinic, and University of Pennsylvania (NCT NCT04112199). Top-line results are expected in Richmond, VA.early 2022, to be followed by a proposed single pivotal Phase 3 trial beginning in 2022. In June 2021, we received written feedback from the FDA in response to a Type B meeting request to conduct a pivotal US Phase 3 clinical trial in HRS-AKI, which is a life-threatening complication of advanced ascites. Based on the guidance received, we are revising certain elements of our proposed study and planning to initiate this study in late 2021.

In neurodegenerative disease, BioVie acquired the biopharmaceutical assets of NeurMedix, Inc., a privately held clinical-stage pharmaceutical company, in June 2021. The acquired assets include NE3107, a potentially selective inhibitor of inflammatory ERK signaling which, based on animal studies is believed to reduce neuroinflammation. NE3107is a novel orally administered small molecule that inhibits inflammation-driven insulin resistance and major pathological inflammatory cascades with a novel mechanism of action. There is emerging scientific consensus that both inflammation and insulin resistance play fundamental roles in the development of Alzheimer’s and Parkinson’s Disease, and NE3107 could represent an entirely new medical approach to treating these devastating conditions affecting an estimated 6 million Americans suffering from Alzheimer’s and 1 million from Parkinson’s. The FDA has authorized a potentially pivotal Phase 3 randomized, double-blind, placebo-controlled, parallel group, multicenter study to evaluate NE3107 in subjects who have mild to moderate Alzheimer’s disease (NCT04669028). We have incurred $1,553,614initiated this trial on August 5, 2021 and are targeting primary completion in late 2022/early 2023. In addition to Alzheimer’s disease, we plan to advance NE3107 in Parkinson’s based on promising results from preclinical studies. Inflammation-driven insulin resistance is implicated in a broad range of serious diseases, including multiple myeloma and prostate cancer, and we plan to begin exploring these opportunities in the coming months using NE3107 or related compounds acquired in the NeurMedix asset purchase.

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Results of Operations

Comparison of the Year Ended June 30, 2021 to the Year Ended June 30, 2020

Net loss

The net loss for the year ended June 30, 2021 was approximately $130.3 million as compared to a net loss of approximately $16.7 million for the year ended June 30, 2020. The net increase in net loss of approximately $113.6 million was primarily comprised of the purchase of the biopharmaceutical assets from Neurmedix totaling approximately $130.6 million and expensed as purchased in process research and development ( IPR&D) in research and development expenses and the increase in other operating expenses of approximately $7.3 million offset by the change in the fair value of derivative liabilities of $17.5 million and the reduction in interest expense of approximately $4.2 million related to the embedded conversion derivative liability from warrants associated with the draws on the convertible debenture which were settled in September 2020.

Total operating expenses for the year ended June 30, 2017.  We are now engaged2021 was approximately $138.1 million as compared to approximately $2.7 million for year ended June 30, 2020. The increase of approximately $135.4 million was attributed to the purchase of the biopharmaceutical assets from Neurmedix, of approximately $130.6 million, increase in organizationalother research and development activities which resulted in an increase of approximately $1.4 million, primarily attributed to the preparation and sourcing compounds and materials. We anticipate incurring other costs associated with equipment purchases andlaunch of our Phase2b clinical trials as well as an increase in selling, general and administrative expenses including employee salaries and benefits, legal expenses, and other costs associated with an early stage, publicly-traded company.

The amounts that we actually spend for any specific purpose may vary significantly, and will depend on a number of factors including, but not limited$3.5 million, primarily due to stock based compensation awarded to the paceboard of progressdirectors.

Research and Development Expenses

Research and development expenses for the year ended June 30, 2021 totaled $133.2 million and included the purchased IPR&D of our$130.6 million, compared to research and development market conditions,for the year ended June 30, 2020 of $1.2 million. During the fiscal year ended June 30, 2021, the Company acquired biopharmaceutical assets under development from Neurmedix and our abilityAcuitas, which are related party affiliates. The assets acquired include, among others, those related to qualify vendors. In addition, we may usecertain drug candidates being developed by NeurMedix, including NE3107, a portionsmall molecule orally administered inhibitor of any net proceeds to acquire complementary compounds; however, we do not have plansinsulin resistance and the pathological inflammatory cascade, with a novel mechanism of action that has potential applications for any acquisitionstreatment against Alzheimer’s Disease and Parkinson’s Disease. The total cost of the asset purchase was approximately $130.6 million and comprised of the issuance of 8,361,308 shares of the Company’s common stock, valued at this time. We will have significant discretion in$14.87 per share, the use of any net proceeds. Investors will be relyingclosing price on the judgment of our management regarding the applicationdate of the proceedsclose and a cash payment of any saleapproximately $2.3 million to Acuitas and other expenses totaling approximately $4.0 million for due diligence, legal fees, transaction fees and the fairness opinion.

The remainder of our Common Stock.the net increase in research and development expenses of $1.4 million was primarily due to an increase in research and development activities related to the preparation of the Phase 2b Clinical Trials. In June 2021, the Company enrolled its first patient into the Phase 2b trial of BIV201 (continuous infusion terlipressin) for the treatment of refractory ascites. The trial is being conducted in nine research centers.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were approximately $4.6 million for the year ended June 30, 2021 and $1.3 million for the year ended June 30, 2020. The net increase of $3.3 primarily consisted of an additional $2.8 million in stock compensation expense attributed to stock options granted to the members of the board of directors for their annual directors’ compensation, additional expenses of approximately $475,000 related to being listed on a national exchange for listing fees, investor relations and other professional fees. Insurance expense of $24,000 primarily related to increased premiums for directors and officers and other liability policies.

 -25--31-

Requirement for Additional CapitalOther Income and Expense, Net

The Company has engaged in limited research and development activities. We currently do not have sufficient funds to meet our planned drug developmentOther income, net increased from other expense, net of $14 million for the next twelve (12) months and we may not be ableyear ended June 30, 2020 to obtain$7.8 million of other income, net for the necessary financing on terms and conditions acceptableyear ended June 30, 2021. This change was primarily due to the Company. Assuming that we are successfulchange in raising additional financing, we plan to incur the following expenses over the next twelve (12) months:

Research and Development of $3,000,000, which includes planned clinical trial costs for the development of BIV201;

Corporate overhead of $500,000, which includes budgeted legal, accounting and other costs expected to be incurred; and

Staffing costs of $500,000.

The Company had approximately $5,140fair value of cash on hand at June 30, 2017 and will be unable to proceed with its planned drug development, meet its administrative expense requirements, capital costs, or staffing costs without obtaining additional net financingderivatives of approximately $4,000,000$17.5 million and the decline in interest expense of approximately $4.2 million due to $5,000,000 to meet its 12-month budgetary needs.embedded derivative warrant liabilities.

The Company has limited experience with pharmaceutical drug development. As such these budget estimates may not be accurate. In addition, the actual work to be performed can only be broadly projected, as is normal with any scientific work. As further work is performed, additional work may become necessary or change in plans or workload may occur. Such changes may have an adverse impact on our estimated budget. Such changes may also have an adverse impact on our projected timeline of drug development.

Management intends to use capital and debt financing, as required, to fund the Company's operations. There can be no assurance that the Company will be able to obtain the additional capital resources necessary to fund its anticipated obligations for the next twelve (12) months.

Capital Resources and Liquidity

As of June 30, 2017, we2021, the Company had $5,140working capital of approximately $3.6 million, cash of $4.5 million, stockholders’ equity of approximately $5.1 million, and accumulated deficit of approximately $224.9 million. In addition, the Company has not generated any revenues and no revenues are expected in the foreseeable future. The Company’s future operations are dependent on handthe success of the Company’s ongoing development and commercialization effort, as well as continuing to secure additional financing.

As described in Note 1 in the accompany financial statements, on June 10, 2021, the Company purchased biopharmaceutical assets from NeurMedix and issued 8,361,308 shares of the Company’s common stock, valued at $14.87 per share at the closing price on June 10, 2021 and was required to make cash payments totaling approximately $6.3 million. These expenditures had a significant impact on the Company’s cash position. On August 11, 2021 the Company closed a capital raise issuing 2.5 million shares of common stock at $8.00 per share and increased cash by the net proceeds of approximately $17.8 million. Although the increase in the cash balance could possibly sustain operations over the next 12 months if measures are taken to delay planned expenditures in our corporate bank account. research protocols and slow the progress in the Company’s clinical programs, the Company’s current planned operations to meet certain goals and objectives, could result in the use of all available cash resources prior to that time based on current projections.

The future viability of the Company is considered to be a development stage company and will continue in the development stage until generating revenues from the sales oflargely dependent upon its products or services. As a result, the report of the independent registered public accounting firm on our financial statements as of June 30, 2017, contains an explanatory paragraph regarding a substantial doubt about our ability to continue as a going concern.

We do not have sufficient funds for the next (12) twelve months and must raise cash to implement our strategy and stay in business. If we are unable to raise additional fundscapital to develop our compounds, we may be required to scale back our development plans by reducing expenditures for employees, consultants, business development, and other envisioned expenditures. This could reduce our ability to develop BIV201, our drug candidate, and implement our business plan. In that event, investors should anticipate that their entire investment may be lost and there may be no ability to profit from this investment.

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finance its operations. We cannot assure you that our drug candidate will be developed, work, or receive regulatory approval; that we will ever earn revenues sufficient to support our operations or that we will ever be profitable. Furthermore, since we have no committed source of sufficient financing, we cannot assure you that we will be able to raise money as and when we need it to continue our operations. If we cannot raise funds as and when we need them, we may be required to severely curtail, or even to cease, our operations.

If we are unable to raise additional funds, we will need to do one or more of the following:

delay, scale-back or eliminate some or all of our research and product development programs;

provide licenses to third parties to develop and commercialize products or technologies that we would otherwise seek to develop and commercialize ourselves;

seek strategic alliances or business combinations;

attempt to sell our company;

cease operations; or

declare bankruptcy.

We believe that our existing cash and cash equivalents will not be sufficient to meet our operating and capital requirements until June 30, 2018. Any debt financing secured by us in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital andAlthough management continues to pursue business opportunities, including potential acquisitions. We may notthese plans, there is no assurance that the Company will be ablesuccessful in obtaining sufficient financing on terms acceptable to secure additional debt or equity financing in a timely manner, orthe Company, if at all, which could require us to scale back our business plan andfund continuing operations.

The above conditions raise substantial doubt about our ability to continue as a going concern.  The financial statements included elsewhere herein were prepared under the assumption that we would continue our operations as a going concern.  Our financial statements do not include any adjustments that may result from the outcome of this uncertainty.  Without additional funds from debt or equity financing, sales of our intellectual property or technologies, or from a business combination or a similar transaction, we will soon exhaust our resources and will be unable to continue operations.  If we cannot continue as a viable entity, our stockholders may lose some or all of their investment in us.

Our management Management intends to attempt to secure additional required funding primarily through additional equity or debt financings.  We may also seek to secure required funding through sales or out-licensing of intellectual property assets, seeking partnerships with other pharmaceutical companies or third parties to co-develop and fund research and development efforts, or similar transactions.  However, there can be no assurance that we will be able to obtain required funding.  If we are unsuccessful in securing funding from any of these sources, we will defer, reduce or eliminate certain planned expenditures in our research protocols.  If we do not have sufficient funds to continue operations, we could be required to seek bankruptcy protection or other alternatives that could result in our stockholders losing some or all of their investment in us.

The emergence of widespread health emergencies or pandemics such as coronavirus (“COVID-19”) and its variants, may lead to continued regional quarantines, business shutdowns, labor shortages, disruptions to supply chains, and overall economic instability, including the duration and spread of the outbreak and restrictions and the impact of COVID-19 and its variants on the financial markets and the overall economy, all of which are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy are impacted for an extended period, the Company’s ability to raise funds may be materially adversely affected.

These circumstances raise substantial doubt on our ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty. 

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Emerging Growth Company

We are an “emerging growth company” under the federal securities laws and will be subject to reduced public company reporting requirements. In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We

are choosing to take advantage of the extended transition period for complying with new or revised accounting standards.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect or change on the Company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets. 

Critical Accounting Policies and Estimates

Accounting for Stock-based Compensation

The preparationCompany follows the provision of financial statementsASC 718- Stock Compensation, which requires the measurement of compensation expense for all shared – based payment awards made to employees and non-employee director, including employee stock options. Share-based compensation expense is based on the grant date fair value estimated in conformityaccordance with accounting principlesthe provisions of ASC 718 and is generally acceptedrecognized as an expense over the requisite service period, net of forfeitures.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the United Statescarrying amount of America requires management to make estimates and assumptions that affect the reported amountsan asset may not be recoverable. Recoverability of assets to be held and liabilities and disclosureused is measured by a comparison of contingentthe carrying amount of the assets to the future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets and liabilitieswould be charged to earnings.

Purchase Accounting for Transactions with Related Party

Purchase accounting for transactions with related party, entities under common control, are recorded at the date ofhistorical carrying cost with no step up in basis to the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

We believe that the following critical policies affect our more significant judgments and estimates used in preparation of our financial statements.

Equipment is recorded at cost and depreciated on a declining balance and straight-line basis over their estimated useful lives, principally two to seven years. Accelerated methods are used for tax depreciation. Maintenance and repairs are charged to operations when incurred. Betterments and renewals are capitalized. When furniture and equipment are sold or otherwise disposedfair market value of the asset account and related accumulated depreciation accountor liability are relieved, and any gain or loss is included in operations.recognized.

Research and development costs are charged to operations when incurred and are included in operating expenses.

New Accounting Pronouncements

For a description of recent accounting standards, including the expected dates of adoption and estimated effects, if any, on our financial statements, see “Note 3: Significant Accounting Polices: Recent Accounting Standards” in Part II, Item 8 of this Form 10-K.

ITEM 7A.QUANTATITATIVEQUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not Applicable.applicable.

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ITEM 8.FINANCIAL STATEMENTS

Our financial information required to be filed hereunder are indexed under Item 15 of this report and are incorporated herein by reference.

ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES

Not applicable.

ITEM 9A.CONTROLS AND PROCEDURES

 

BioVie, Inc. (F/K/A NanoAntibiotics Inc.)Evaluation of Disclosure Controls and Procedures

We have evaluated, with the participation of our principal executive and our principle financial officer, the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our principal executive officer and our principal financial officer have concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

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Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of the effectiveness of internal control to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.  Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of June 30, 2021 using the criteria established in Internal Control Integrated Framework (“2013 Framework”) issued by the Committee of Sponsoring Organization of the Treadway Commission (“COSO”). Based on our evaluation using those criteria, our management has concluded that, as of June 30, 2021, our internal control over financial reporting was effective 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 for the reasons discussed above.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls over financial reporting during quarter ended June 30, 2021, that materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.

ITEM 9B.OTHER INFORMATION

None.  

ITEM 9C.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable. 

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PART III .

ITEM 10.DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this item will be included in our Proxy Statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended June 30, 2021 and is incorporated herein by reference.

ITEM 11.EXECUTIVE COMPENSATION

The information required by this item will be included in our Proxy Statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended June 30, 2021 and is incorporated herein by reference.

ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND  RELATED STOCKHOLDER MATTERS

The information required by this item will be included in our Proxy Statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended June 30, 2021 and is incorporated herein by reference.

ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item will be included in our Proxy Statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended June 30, 2021 and is incorporated herein by reference.

ITEM 14.PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item will be included in our Proxy Statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended June 30, 2021 and is incorporated herein by reference.

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PART IV

ITEM 15.EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1),(2) Financial Statements

Contents

The Financial Statements listed on page F-1 of this document are filed as part of this filing.

(a)(3) Exhibits

The following is a list of exhibits filed as a part of this report:

Exhibit
Number
 Description of Document
2.1 Agreement and Plan of Merger, dated April 11, 2016, among the Company, LAT Acquisition Corp and LAT Pharma, LLC (incorporated by reference to Exhibit 2.1 the Company’s Current Report on Form 8-K filed on April 15, 2016).
3.1Articles of Incorporation of the Company as filed with the Secretary of State of Nevada (incorporated by reference to Exhibit 3.1 to the Company’s registration statement on Form S-1 filed on August 15, 2013, File No. 333-190635).
3.2Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on July 22, 2016).
3.3Certificate of Amendment to Articles of Incorporation (incorporated by reference to Appendix A to the Company’s Information Statement on Schedule 14C filed on July 13, 2018).
3.4Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on July 3, 2018).
3.5Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Company’s registration statement on Form S-1 filed on August 15, 2013, File No. 333-190635).
3.6Certificate of Amendment to Articles of Incorporation
4.1Specimen Certificate representing shares of Class A Common Stock. (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1, File No. 333-231136)
4.2Form of Warrant (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on September 25, 2019).
4.3Form of 10% OID Convertible Delayed Draw Debenture (incorporated by reference to Exhibit 4.1 the Company’s Current Report on Form 8-K filed on September 25, 2019).
4.4Description of Securities
10.1Securities Purchase Agreement, dated as of July 3, 2018, by and among BioVie Inc., Acuitas Group Holdings, LLC and the Purchasers identified therein (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 3, 2018).
10.2Employment Agreement between Jonathan Adams and the Company dated, April 11, 2016. (incorporated by reference to Exhibit 10.3 to the Company’s Registration Statement on Form S-1, File No. 333-231136)
10.4Amendment No. 1 to Employment Agreement between Jonathan Adams and the Company dated July 3, 2018. (incorporated by reference to Exhibit 10.4 to the Company’s Registration Statement on Form S-1, File No. 333-231136)
10.5Letter Agreement between Acuitas Group Holdings, LLC and the Company dated June 24, 2019. (incorporated by reference to Exhibit 10.5 to the Company’s Registration Statement on Form S-1, File No. 333-231136)
10.6BioVie Inc. 2019 Omnibus Equity Incentive Plan (incorporated by reference to Appendix D to the Definitive Information Statement on Schedule 14C, filed on May 8, 2019)
10.7Securities Purchase Agreement dated as of September 24, 2019 by and among BioVie Inc. and Acuitas Group Holdings, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 25, 2019)
10.8Amendment to Securities Purchase Agreement, dated as of October 9, 2019, by and between the Company and Acuitas Group Holdings, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 9, 2019)
10.9Biovie Inc. Letter Agreement with Acuitas Group Holdings, LLC dated as of February 10, 2020 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on February 13, 2020).
10.10Biovie Inc. Letter Agreement with Acuitas Group Holdings, LLC dated as of April 8, 2020 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 13, 2020).
10.11Biovie Inc. Letter Agreement with Acuitas Group Holdings, LLC dated as of July 14, 2020. (incorporated by reference to Exhibit 10.11 to the Company’s Registration Statement on Form S-1, File No. 333-231136)
10.12Asset Purchase Agreement by and Among BioVie,Inc - Buyer and Neurmedix, Inc - Seller and Acuitas Group Holdings as Gauarantor of April 27, 2021 filed on Form 8-K on April 27, 2021
10.13Amendment No. 1 of the Asset Purchase Agreement dated May 9, 2021 filed on Form 8-K on May 10, 2021
14.1Code of Conduct and Ethics of BioVie Inc. (incorporated by reference to Exhibit 14.1 to the Company’s Registration Statement on Form S-1, File No. 333-231136).
23.1Consent of Independent Registered Public Accounting Firm - EisnerAmper LLP*
31.1Rule 13a-14(a) Certification
31.2Rule 13a-14(a) Certification
32.1Certification Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to section 906 of the Sarbanes-Oxley Act of 2002
32.2Certification 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 Calculation Linkbase Document
101.LAB XBRL Taxonomy Label Linkbase Document
101.PRE XBRL Taxonomy Presentation Linkbase Document
101.DEF XBRL Taxonomy Extension Definition Linkbase Document

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Signatures

Pursuant to the requirements of Section 13 or 15(d) 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.

BIOVIE INC.
By: /s/ Cuong Do
Name: Cuong Do
Title:Chief Executive Officer
(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons in the capacities and on the dates indicated.

PersonCapacityDate
/s/ Cuong DoChief Executive OfficerAugust 30, 2021
Cuong Do(Principal Executive Officer)
/s/ Joanne Wendy KimChief Financial OfficerAugust 30, 2021
Joanne Wendy Kim(Principal Financial Officer)
/s/ Terren PiezerChairmanAugust 30, 2021
Terren Piezer
/s/ Jim LangDirectorAugust 30, 2021
Jim Lang
/s/ Michael ShermanDirectorAugust 30, 2021
Michael Sherman
/s/ Richard J. BermanDirectorAugust 30, 2021
Richard J. Berman
/s/ Steve GorlinDirectorAugust 30, 2021
Steve Gorlin
/s/ Robert HaririDirectorAugust 30, 2021
Robert Hariri
/s/ Sigmund RogichDirectorAugust 30, 2021
Sigmund Rogich

-37-

BioVie Inc.

Index to Financial Statements

Report of Independent Registered Public Accounting FirmsFirm – EisnerAmper LLP  30F-2 
  
Financial Statements:    
  
Balance Sheets  31F-4 
Statements of Operations  32F-5 
Statements of Changes in Stockholders’ Equity (Deficit)  33F-6 
Statements of Cash Flows  34F-7 
Notes to Financial Statements  35F-8 

 -29-F-1 

REPORT OF INDEPENDENT REGISTERED INDEPENDENT AUDITORSPUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

of BioVie Inc.:

Opinion on the Financial Statements

We have audited the accompanying balance sheets of BioVieBiovie Inc. (the “Company”) as of June 30, 20172021 and 20162020, and the related statements of operations, changes in stockholders’ equity (deficit), and cash flows for each of the years then ended, June 30, 2017 and 2016. These financial statements are the responsibility ofrelated notes (collectively referred to as the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States of America)“financial statements”). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of BioVie Inc.the Company as of June 30, 20172021 and 20162020, and the results of its operations and its cash flows foreach of the years then ended, June 30, 2017 and 2016 in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has incurred anCompany’s recurring losses from operations and negative cash flows from operating loss since inception. Further, as of June 30, 2017, the Company has not earned any revenues. These and other factorsactivities raise substantial doubt about the Company’sits ability to continue as a going concern. Management’s plan regardingplans in regard to these matters isare also described in Note 2 to the financial statements.2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Respectfully submitted,Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Weinberg & Baer LLC

Baltimore, MarylandWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

August 22, 2017

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 -30-F-2 

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Related Party Transactions

As described in note 5 to the financial statements, the Company has entered into agreements with a related party. As part of these agreements, the Company is required to issue common stock and, at times, warrants to the related party. The purchase option to the related party for the additional securities resulted in a deemed dividend of approximately $53 million recorded on the June 30, 2021 balance sheet. Additionally, in accordance with the Asset Purchase Agreement identified in note 5, the Company recorded approximately $130.6 million of in-process research and development expenses on the June 30, 2021 statement of operations and $124.3 million of common stock and additional paid-in-capital and cash paid to related party of approximately $2.3 million on the June 30, 2021 balance sheet.

We identified management’s related party transactions as a critical audit matter due to the significance of transactions occurring throughout the year and management’s process to ensure all transactions are recorded and disclosed accurately. This in turn led to a high degree of auditor judgment, subjectivity and effort in applying the procedures related to those transactions.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the financial statements. We obtained an understanding and evaluated the design of the controls over the Company’s process to identify, account for and disclose related party transactions. We performed procedures to test the common stock, additional paid-in-capital, deemed dividend and in-process research and development expenses balances related to related parties transactions at the balance sheet date. Our audit procedures also included, among others, reading agreements and subsequent amendments, and testing invoices to related parties to ensure expenses are accurate and proper approval from management and audit committee was received. We also made direct inquiries of financial personnel on the status of all agreements to ensure the population of amendments or new agreements entered into was complete and that these items were properly accounted for and disclosed. Additionally, we reviewed all board minutes to ensure completeness of related party transactions.

/s/ EisnerAmper LLP

We have served as the Company’s auditor since 2019.

EISNERAMPER LLP

Iselin, New Jersey

August 30, 2021

F-3 

BioVie Inc. (F/K/A NanoAntibiotics, Inc.)

Balance Sheets

  June 30,  June 30, 
  2021  2020 
ASSETS        
         
CURRENT ASSETS:        
Cash $4,511,642  $37,195 
Other assets  93,487   375,785 
Total current assets  4,605,129   412,980 
         
OTHER  ASSETS:        
Intangible assets, net  1,095,849   1,325,226 
Goodwill  345,711   345,711 
Total other assets  1,441,560   1,670,937 
         
TOTAL ASSETS $6,046,689  $2,083,917 
         
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)        
         
CURRENT LIABILITIES:        
Accounts payable and accrued expenses $996,374  $1,259,206 
Derivative liability - warrants     16,411,504 
Derivative liability - conversion option on convertible debenture     5,000,800 
Convertible debenture - related party, net of unearned discount of $0 and $462,864 and capitalized accrued interest of $0 and $48,407 at June 30, 2021 and June 30, 2020, respectively     848,543 
Total current liabilities  996,374   23,520,053 
         
Loan Payable     62,500 
TOTAL LIABILITIES  996,374   23,582,553 
         
Commitments and contingencies (Note 8)        
         
STOCKHOLDERS’ EQUITY (DEFICIT):        
         
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 June 30, 2021 and June 30, 2020, respectively; 22,333,324 and 5,204,392 shares issued and outstanding at June 30, 2021 and June 30, 2020, respectively  2,232   520 
Additional paid in capital  229,933,505   19,538,742 
Accumulated deficit  (224,885,422)  (41,037,898)
Total stockholders’ equity (deficit)  5,050,315   (21,498,636)
         
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) $6,046,689  $2,083,917 

 

  June 30, June 30,
  2017 2016
ASSETS        
         
CURRENT ASSETS:        
Cash  5,140   123,757 
Prepaid expenses  —     6,982 
Total Current Assets  5,140   130,739 
         
OTHER  ASSETS:        
Intangible Assets (Net of Amortization)  2,013,357   2,242,734 
Goodwill  345,711   345,711 
Total Other Assets  2,359,068   2,588,445 
         
TOTAL ASSETS  2,364,209   2,719,184 
         
LIABILITIES AND STOCKHOLDERS' DEFICIT        
         
CURRENT LIABILITIES:        
Accounts Payable and accrued expenses  470,973   293,633 
Related Party Loan  35,000   10,000 
Accrued Payroll  125,000   499,612 
Total Current Liabilities  630,973   803,245 
         
LONG-TERM LIABILITIES:        
Accrued Expenses  173,334   —   
Accrued Payroll  402,584   —   
Total Long-Term Liabilities  575,918   —   
         
TOTAL LIABILITIES  1,206,891   803,245.00 
         
STOCKHOLDERS' EQUITY (DEFICIT)        
Preferred stock; $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding  —     —   
Common stock, $0.0001 par value; 300,000,000 shares authorized; shares issued and 91,925,000 and 87,160,001 shares issued and outstanding, respectively  9,192   8,716 
Additional paid in capital  3,483,134   2,911,560 
Accumulated deficit  (2,335,009)  (1,004,337)
Total Stockholders' Equity (Deficit)  1,157,318   1,915,939 
         
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)  2,364,209   2,719,184 

The accompanying notes are an integral part of the financial statements.

 -31-F-4 

BioVie Inc. (F/K/A NanoAntibiotics, Inc.)

Statements of Operations

  Year ended  Year ended 
  June 30, 2021  June 30, 2020 
OPERATING EXPENSES:        
Amortization $229,377  $229,377 
Research and development expenses  133,187,506   1,150,581 
Selling, general and administrative expenses  4,637,256   1,312,930 
TOTAL OPERATING EXPENSES  138,054,139   2,692,888 
         
LOSS FROM OPERATIONS  (138,054,139)  (2,692,888)
         
OTHER EXPENSE (INCOME) EXPENSE:        
Change in fair value of derivative liabilities  (8,279,919)  9,211,686 
Gain on extinguishment of debt  (62,500)   
Interest expense  559,455   4,772,429 
Interest income  (21,971)  (234)
TOTAL OTHER (INCOME) EXPENSE, NET  (7,804,935)  13,983,881 
         
NET LOSS $(130,249,204) $(16,676,768)
         
Deemed dividends - related party  53,598,320   17,099,058 
         
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $(183,847,524) $(33,775,826)
         
NET LOSS PER COMMON SHARE        
- Basic $(14.82) $(6.85)
- Diluted $(14.82) $(6.85)
         
WEIGHTED AVERAGE NUMBER OF COMMON  SHARES OUTSTANDING        
- Basic  12,403,159   4,929,497 
- Diluted  12,403,159   4,929,497 

 

  For the Year Ended For the Year Ended
  June 30, June 30,
  2017 2016
     
REVENUE:        
Sales $—    $—   
   —     —   
         
COST OF GOODS SOLD  —     —   
         
GROSS MARGIN  —     —   
         
OPERATING EXPENSES        
Amortization  229,377   51,036 
Research and development expenses  466,354   37,901 
Payroll expenses  285,392   184,537 
Professional fees  503,369   143,235 
Selling, general and administrative expenses  69,122   15,319 
TOTAL OPERATING EXPENSES  1,553,614   432,028 
         
LOSS FROM OPERATIONS  (1,553,614)  (432,028)
         
OTHER EXPENSE (INCOME)        
Other Income  (222,928)  —   
Interest expense  —     81 
Interest income  (14)  (186)
TOTAL OTHER EXPENSE (INCOME)  (222,942)  (105)
         
NET LOSS $(1,330,672) $(431,923)
         
NET LOSS PER COMMON SHARE, BASIC AND DILUTED $(0.01) $(0.00)
         
WEIGHTED AVERAGE NUMBER OF        
COMMON  SHARES OUTSTANDING, BASIC AND DILUTED  89,391,302   87,198,875 

The accompanying notes are an integral part of the financial statements.

 -32-F-5 

BioVie Inc. (F/K/A NanoAntibiotics, Inc.)

StatementStatements of Changes in Stockholders’ Equity

(Deficit)
For the Years Ended June 30, 20172021 and 20162020

         Additional      Total 
  Common Stock  Common Stock  Paid in  Accumulated  Stockholders’ 
  Shares  Amount  Capital  Deficit  Equity (Deficit) 
                
Balance, June 30, 2019  4,058,724  $406  $9,392,573  $(7,262,072) $2,130,907 
                     
Issuance of commitment shares  1,125,000   112   10,068,638      10,068,750 
                     
Deemed dividend for commitment shares           (17,099,058)  (17,099,058)
                     
Stock option compensation        24,846      24,846 
                     
Issuance of shares for services  11,200   1   39,199      39,200 
                     
Issuance of shares for interest payment  4,422      13,487      13,487 
                     
Cashless exercise of options  5,046   1   (1)      
                     
Net loss           (16,676,768)  (16,676,768)
                     
Balance, June 30, 2020  5,204,392  $520  $19,538,742  $(41,037,898) $(21,498,636)
                     
Proceeds from issuance of common stock  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 and warrants  3,238             
                     
Stock-based compensation        3,019,809      3,019,809 
                     
Proceeds from exercise of warrants  54,824   5   685,297      685,302 
                     
Issuance of shares for purchase of in process research and development expenses - related party  8,361,308   836   124,331,813      124,332,649 
                     
Net loss              (130,249,204)  (130,249,204)
                     
Balance, June 30, 2021  22,333,324  $2,232  $229,933,505  $(224,885,422) $5,050,315 

 

        Prepaid    
      Additional Services   Total
  Common Stock Paid in Paid with Accumulated Stockholders'
  Shares Amount Capital Common Stock Deficit Deficit
             
Balance, June 30, 2015  87,210,000   8,721   514,485   (4,911)  (572,414)  (54,119)
                         
Retirement of Shares  (39,869,999)  (5)  —     —     —     (5)
                         
Shares Issued For Acquisition  39,820,000   —     2,397,075   —     —     2,397,075 
                         
Prepaid services paid with common stock  —     —     —     4,911   —     4,911 
                         
Net loss  —     —     —     —     (431,923)  (431,923)
                         
Balance, June 30, 2016  87,160,001   8,716   2,911,560   —     (1,004,337)  1,915,939 
                         
Issuance of Shares  4,764,999   477   479,523   —     —     479,999 
                         
Options Vested $—     —     92,051   —     —     92,051 
                         
Net loss  —     —     —     —     (1,330,672)  (1,330,672)
                         
Balance, June 30, 2017  91,925,000   9,193   3,483,134   —     (2,335,009)  1,157,318 

The accompanying notes are an integral part of the financial statements.

 -33-F-6 

BioVie Inc. (F/K/A NanoAntibiotics, Inc.)

Statements of Cash Flows

  June 30, 2021  June 30, 2020 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net loss $(130,249,204) $(16,676,768)
Adjustments to reconcile net loss to net cash used in operating activities:        
Amortization of intangible assets  229,377   229,377 
Common shares issued for service     39,200 
Common shares issued for interest payment     13,487 
Common shares issued for asset acquisition  124,332,649     
Stock based compensation expense  3,019,809   24,846 
Gain on extinguishment of loan payable  (62,500)   
Interest expense from convertible debenture  537,275   4,755,853 
Change in fair value of derivative liabilities  (8,279,919)  9,211,686 
Changes in operating assets and liabilities:        
Other assets  282,298   (41,635)
Accounts payable and accrued expenses  (262,832)  815,726 
Net cash used in operating activities  (10,453,047)  (1,628,228)
         
CASH FLOWS FROM FINANCING ACTIVITIES:        
Net proceeds from issuance of common stock  15,628,010    
Proceeds from exercise of warrants  685,302    
Payment of convertible debenture - related party  (1,821,818)   
Proceeds from convertible debenture - related party  436,000   1,263,000 
Proceeds from loan payable     62,500 
Net cash provided by financing activities  14,927,494   1,325,500 
         
Net increase (decrease) in cash  4,474,447   (302,728)
         
Cash, beginning of period  37,195   339,923 
         
Cash, end of period $4,511,642  $37,195 
         
SUPPLEMENTAL CASH FLOW INFORMATION:        
Cash paid for interest $22,180  $3,093 
Cash paid for taxes $  $ 
         
SCHEDULE OF NON-CASH FINANCING ACTIVITIES:        
Deemed dividends - related party $53,598,320  $17,099,058 
Stock warrants classified as derivative liability $  $7,530,308 

 

  For the Year For the Year
  Ended June 30, Ended June 30,
  2017 2016
     
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net loss $(1,330,672) $(431,923)
Adjustments to reconcile net loss to net cash to cash used by operating activities:        
Amortization of prepaid common stock for services  —     4,911 
Amortization of intangible assets  229,377   51,036 
Share based compensation expense  92,052   7,875 
Changes in operating assets and liabilities        
Change in prepaid expenses  6,982   (4,982)
Increase (decrease) in:        
Accounts Payable  350,674   42,790 
Accrued Payroll  27,972   176,662 
Net cash used by operating activities  (623,615)  (153,631)
         
CASH FLOWS FROM INVESTING ACTIVITIES:        
Cash acquired through the merger  —     9,912 
Net cash provided by investing activities  —     9,912 
         
CASH FLOWS FROM FINANCING ACTIVITIES:        
Proceeds from issuance of common stock  479,999   —   
Retirement of common Stock  —     (5)
Related Party Loan  25,000     
Net cash provided (used) by financing activities  504,999   (5)
         
Net decrease in cash  (118,616)  (143,724)
         
Cash, beginning of period  123,757   267,481 
         
Cash, end of period $5,141  $123,757 
         
SUPPLEMENTAL CASH FLOW INFORMATION:        
         
Cash paid for interest $—    $—   
         
NON-CASH INVESTING ACTIVITIES        
Fair value of assets acquired, net of cash acquired  —     2,283,858 
Fair value of liabilities assumed  —     260,193 
         
NON-CASH FINANCING ACTIVITIES        
Gain on extinguishment of debt $222,028  $—   

The accompanying notes are an integral part of the financial statements.

 -34-F-7 

1.Background Information

BioVie Inc. (F/K/A NanoAntibiotics, Inc.(the “Company” or “we” or “our”)

Notes to Financial Statements

For the Years Ended June 30, 2017 and 2016

1.Background Information

BioVie Inc. is a clinical-stage company pursuing the discovery, development, and commercialization ofdeveloping innovative drug therapies. The Company istherapies to treat chronic debilitating conditions including liver disease and neurological and neuro-degenerative disorders and certain cancers. We are currently focused on developing and commercializing BIV201 (continuous infusion terlipressin), a novel investigational approach to the treatment of ascites due to chronic liver cirrhosis. In March 2017, Our therapy BIV201 is based on a drug that is approved in about 40 countries to treat related complications of liver cirrhosis (part of the same disease pathway as ascites), but not yet available in the United States. BIV201’s active agent is a potent vasoconstrictor and has shown efficacy for reducing portal hypertension in studies around the world. The goal is for BIV201 to interrupt the ascites disease pathway, thereby halting the cycle of accelerating fluid generation in ascites patients.

BioVie received notification from the FDA that it could initiatecompleted a Phase 2a US clinical trial andof BIV201 in April the Company signed a Cooperative Research and Development Agreement (CRADA)six patients with refractory ascites due to advanced liver cirrhosis at the McGuire Research Institute/VAInstitute in Richmond, VA in 2019. The Company met with representatives of the Food and Drug Administration (“FDA”) in a Type C Guidance Meeting to discuss the study results and plan our next clinical study. Subsequently, we requested a Type B Meeting and submitted an extensive pre-meeting information package. In April 2020, the FDA provided a written response that provided new guidance regarding primary and secondary endpoints, BIV201 dosing levels, quality of life measures and other key aspects of the clinical trial design. After further communications, the Company completed the clinical trial design protocol and was cleared to begin dosinga Phase 2 clinical study. We activated the first trial sites in the first calendar quarter of 2021 and as of July 2021, seven of nine planned US study centers have been activated and are actively screening patients, and two patients have been enrolled in the study. We plan to follow this study with a larger potentially pivotal Phase 3 clinical trial expected to begin in 2022. The Phase 2 study results will be used to guide the design of a potentially pivotal Phase 3 clinical trial. We have developed a patent-pending novel liquid formulation of BIV201 for use in mid-2017.this study that is intended to improve convenience for outpatient administration and avoid potential formulation errors that may occur when pharmacists reconstitute the powder version of terlipressin.

BIV201 has the potential to improve the health of thousands of patients suffering from life-threatening complications of liver cirrhosis due to hepatitis, NASH,nonalcoholic steatohepatitis (NASH), and alcoholism. It has FDA Fast-Track status and Orphan Drug designation for the most common of these complications, ascites, which represents a significant unmet medical need. The first-approved orphan drug may receive 7 years of market exclusivity in the United States for the specific drug for the specific orphan indication. The FDA has never approved any drug specifically for treating ascites. For more information about BioVie and BIV201, please visit our website: www.biovieinc.com.In addition, the Company is applying for global patent coverage of a proprietary liquid formulation of terlipressin which could eventually provide up to 20 years of patent protection in countries where the Company seeks patent issuance according to local patent laws.

The BIV201 development program began at LAT Pharma LLC. On April 11, 2016, the Company acquired LAT Pharma LLC and the  rights to its BIV201 development program. WeThe Company currently ownowns all development and marketing rights to ourits drug candidate, except as noted previously, thecandidate. The Company and PharmaIN, have exchanged small (low single-digit)Corp. (“PharmaIN”), LAT Pharma’s former partner focused on the development of new modified drug candidates in the same therapeutic field but not including BIV201, had agreed to pay royalties equal to less than 1% of future net sales of each company’s ascites drug development programs, or if such program is licensed to a third party, less than 5% of each company’s net license revenues. On December 24, 2018, the Company returned its partial ownership rights to each other’s ascitesthe PharmaIN modified terlipressin development program and simultaneously paid the remaining balance due on a related debt. PharmaIN, Corp.’s rights to our program remain unchanged.

On April 27, 2021, the Company entered into an Asset Purchase Agreement (the “APA”) with NeurMedix, Inc. (“NeurMedix”) and Acuitas Group Holdings, LLC (“Acuitas”), which are related party affiliates, pursuant to which the Company acquired certain assets from NeurMedix and assumed certain liabilities of NeurMedix, in exchange for the consideration of cash and shares of common stock. (collectively, the “Transaction”). The acquired assets include, among others, those related to certain drug development programs.candidates being developed by NeurMedix, including NE3107, a small molecule orally administered inhibitor of insulin resistance and the pathological inflammatory cascade, with a novel mechanism of action that has potential applications for treatment against Alzheimer’s Disease and Parkinson’s Disease.

F-8 

The total cost of the asset purchase of the In Process Research and Development (“IPR&D”) was approximately $130.6 million. The Company recently filed patent applicationsissued 8,361,308 shares of the Company’s common stock, valued at $14.87 per share, the closing price on June 10, 2021 (the closing date); and was required to make cash payments totaling approximately $6.3 million, of which approximately $2.3 million was paid to Acuitas and approximately $4.0 million to others for due diligence, legal fees, transaction fees and the fairness opinion.

Subject to the terms and conditions of Amendment No. 1 to the APA dated May 9, 2021, (the “Amendment” and the APA as so amended, the “Asset Purchase Agreement”); following the closing, the Company may be obligated to deliver contingent stock consideration to NeurMedix (or its drug candidatesuccessor) consisting of up to 18.0 million shares of BioVie’s common stock, with 4.5 million shares issuable upon the achievement of each of the four milestones set forth in the USAsset Purchase Agreement, subject to a cap limiting the issuance of shares if such issuance would result in the beneficial ownership of NeurMedix and Japan, as well as a PCT in Europe. We are currently completing the work necessary to file our investigational new drug (IND) application,its affiliates exceeding 87.5% of BioVie’s issued and aim to commence clinical trials should the FDA approve our application.outstanding common. (See Note 5 Related Party Transactions - Equity Transactions with Acuitas )

2.Liquidity and Going Concern

The Company’s activitiesoperations are subject to significant risksa number of factors that can affect its operating results and uncertainties including failurefinancial conditions. Such factors include, but are not limited to: the results of clinical testing and trial activities of the Company’s products, the Company’s ability to secure additional fundingobtain regulatory approval to properly executemarket its products, competition from products manufactured and sold or being developed by other companies, the company’s business plan.

2.Going Concern

price of, and demand for, Company products, the Company’s ability to negotiate favorable licensing or other manufacturing and marketing agreements for its products, and the Company’s ability to raise capital. The accompanyingCompany’s financial statements have been prepared assuming that the Company will continue as a going concern. Forconcern, which contemplates the year ended June 30, 2017,realization of assets and the Company had a net losssatisfaction of $1,330,672.liabilities in the normal course of business. As of June 30, 2017,2021, the Company had working capital of approximately $3.6 million, cash of approximately $4.5 million, stockholders’ equity of approximately $5.1 million, and an accumulated deficit of approximately $224.9 million. In addition, the Company has not earnedgenerated any revenues. In viewrevenues to date and no revenues are expected in the foreseeable future. The Company’s future operations are dependent on the success of the Company’s ongoing development and commercialization effort, as well as continuing to secure additional financing. The cash payments required to close on the purchase of the biopharmaceutical assets from NeurMedix had a significant impact on the Company’s cash position. On August 11, 2021, the Company closed a capital raise issuing 2.5 million shares of commons stock at $8.00 per share and increased cash by the net proceeds of approximately $17.8 million. Although the increase in the cash balance could possibly sustain operations over the next 12 months if measures are taken to delay planned expenditures in our research protocols and slow the progress in the Company’s clinical programs, the Company’s current planned operations to meet certain goals and objectives, project cash flows to be depleted within that period of time.

The future viability of the Company is largely dependent upon its ability to raise additional capital to finance its operations. Management expects that future sources of funding may include sales of equity, obtaining loans, or other strategic transactions. The emergence of widespread health emergencies or pandemics such as coronavirus (“COVID-19”) and its variants, may lead to continued regional quarantines, business shutdowns, labor shortages, disruptions to supply chains, and overall economic instability, including the duration and spread of the outbreak and restrictions and the impact of COVID-19 and its variants on the financial markets and the overall economy, all of which are highly uncertain and cannot be predicted. If the financial markets and/or the overall economy are impacted for an extended period, the Company’s ability to raise funds may be materially adversely affected.

Although management continues to pursue these matters,plans, there is no assurance that the Company will be successful in obtaining sufficient financing on terms acceptable to the Company, if at all, to fund continuing operations. These circumstances raise substantial doubt on the Company’s ability to continue as a going concern is dependent upon the Company’s ability to begin operations and to achieve a level of profitability. Since inception, the Company has financed its activities principally from the sale of public equity securities. The Company intends on financing its future development activities and its working capital needs largely from the sale of public equity securities with some additional funding from other traditional financing sources, including term notes and proceeds from sub-licensing agreements until such time that funds provided by operations are sufficient to fund working capital requirements.concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary shouldresult from the Company be unable to continue as a going concern.

outcome of this uncertainty.

 -35-F-9 

3.Significant Accounting Policies

Basis of Presentation

The preparation ofCompany’s financial statements have been prepared in conformityaccordance with accounting principles generally accepted in the United States (“GAAP”) and include all adjustments necessary for the fair presentation of Americathe Company’s financial position for the periods presented.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances. The amounts of assets and liabilities reported in the Company’s balance sheet and disclosurethe amounts of contingent assets and liabilities at the dateexpenses reported for each of the financial statementsperiods presented are affected by estimates and the reported amounts of revenuesassumptions, which are used for, but not limited to, accounting for share-based compensation, accounting for derivatives and expenses during the reporting period.accounting for income taxes. Actual results could differ from those estimates.

Cash

The Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents. Cash is maintained at two financial institutions, and, at times, balances may exceed federally insured limits. We haveThe Company has never experienced any losses related to these balances. All

Other Assets

Other assets consist of our cash balances were fully insureddirect costs related to capital raise and filing of the registration statement legal fees and investment banking fees incurred to raise capital. The costs will be offset against proceeds received once the Company raises the capital.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at June 30, 2017.the measurement date. When determining the fair value for applicable assets and liabilities, we consider the principal or most advantageous market in which we would transact and we consider assumptions market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance. This guidance also establishes a fair value hierarchy to prioritize inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

Financial Instruments

The Company’s financial instruments include cash, accounts payable, related party loans and accounts payable.a demand promissory note. The carrying amounts of cash and accounts payable approximate their fair value, due to the short-term nature of these items.

Loan Pursuant to Paycheck Protection Program

The carrying amountsCompany received $62,500 in loan proceeds pursuant to the Paycheck Protection Program (“PPP”), under the Coronavirus Aid Relief and Economic Security (CARES) Act. The PPP Loan is evidenced by a loan application and payment agreement by and between the Company and Lender. The Company applied for the loan in May 2020 and received funding for its maximum amount of $62,500 on May 21, 2020. The term of the loan is for 60 months and matures on the fifth-year anniversary from the date of funding. It bears interest at an annual rate of 1%. On June 28, 2021, the Company received confirmation that the Small Business Administration’s PPP loan was forgiven and recognized the loan forgiveness as gain on extinguishment of debt converted to long-term notes payable are reported at their original amounts.in the accompanying Statements of Operations.

F-10 

Research and Development

Research and development expenses consist primarily of costs are charged to operations when incurredassociated with the preclinical and/ or clinical trials of drug candidates, compensation and are included in operating expenses. The Company expensed $466,354 and $37,901other expenses for research and development, personnel, supplies and development materials, costs for consultants and related contract research and facility costs. Expenditures relating to research and development are expensed as incurred. In the fiscal year ended June 30, 2021 the company recorded the assets acquired totaling approximately $130.6 million from NeurMedix, a controlled affiliate of Acuitas, our majority shareholder, that were under development as research and development expenses in the accompanying Statements of Operations. See Note 1 - Background Information.

Income Taxes

The Company uses the asset and liability method of accounting for deferred income taxes. Deferred income taxes are measured by applying enacted statutory rates to net operating loss carryforwards and to the differences between the financial reporting and tax bases of assets and liabilities. Deferred tax assets are reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized.

The Company recognizes uncertainty in income taxes in the financial statements using a recognition threshold and measurement attribute of a tax position taken or expected to be taken in a tax return. The Company applies the “more-likely-than-not” recognition threshold to all tax positions, commencing at the adoption date of the applicable accounting guidance, which resulted in no unrecognized tax benefits as of such date. Additionally, there have been no unrecognized tax benefits subsequent to adoption. The Company has opted to classify interest and penalties that would accrue, if any, according to the provisions of relevant tax law as general and administrative expenses, in the Statements of Operations. For the years ended June 30, 20172021 and 2016, respectively.2020, there was no such interest or penalty.

Income TaxesNet Loss per Common Share

Deferred income tax assets and liabilities arise from temporary differences associated with differences between the financial statements and tax basis of assets and liabilities, as measured by the enacted tax rates, which are expected to be in effect when these differences reverse. Deferred tax assets and liabilities are classified as current or non-current, depending on the classification of the assets or liabilities to which they relate. Deferred tax assets and liabilities not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.

The Company follows the provisions of FASB ASC 740-10 “Uncertainty in Income Taxes” (ASC 740-10), January 1, 2007. The Company has not recognized a liability as a result of the implementation of ASC 740-10. A reconciliation of the beginning and ending amount of unrecognized tax benefits has not been provided since there are no unrecognized benefits at June 30, 2017 and since the date of adoption. The Company has not recognized interest expense or penalties as a result of the implementation of ASC 740-10. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.

Earnings (Loss)Basic net loss per Share

Basic earnings percommon share areis computed by dividing the net incomeloss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the year.period. Diluted earningsnet loss per common share areis computed by dividing the net incomeloss attributable to common stockholders by the weighted average number of shares of common stock outstanding and dilutive optionspotentially outstanding shares of common stock during the year.period to reflect the potential dilution that could occur from common shares issuable through stock options, warrants, and convertible debentures. For the yearyears ended June 30, 2017 all outstanding options have been2021 and 2020, such amounts were excluded from the calculation of the diluted net loss per share since their effect was anti-dilutive.considered anti-dilutive due to the net loss for the year.

The table below shows the number of outstanding stock options and warrants as of June 30, 2021 and June 30, 2020:

Schedule of Dilutive securities were excluded from the computation of diluted loss per share

  June 30, 2021  June 30, 2020 
  Number of
Shares
  Number of
Shares
 
Stock Options  755,200   60,400 
Warrants  158,761   1,374,667 
Total  913,961   1,435,067 

 -36-F-11 

Stock-based Compensation

The Company has accounted for stock-based compensation under the provisions of FASB ASC 718 – “Stock Compensation” which requires the use of the fair-value based method to determine compensation for all arrangements under which employees and others receive shares of stock or equity instruments (stock options and common stock purchase warrants). For employee awards, the fair value of each stock option award is estimated on the date of grant using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. For non-employees, the fair value of each stock option award is estimated on the measurement date using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. For non-employees, the Company utilizes the graded vesting attribution method under which the entity treats each separately vesting portion (tranche) as a separate award and recognizes compensation cost for each tranche over its separate vesting schedule. Expected volatilities are based on historical volatility of peer companies and other factors estimated over the expected term of the stock options. For employee awards, the expected term of options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the period of the expected term. The Company recognizes all share-based paymentsforfeitures as they occur.

Goodwill

Goodwill is recorded when the purchase price paid for an acquisition exceeds the fair value of net identified tangible and intangible assets acquired. The Company performs an annual impairment test of goodwill and further periodic tests to employees,the extent indicators of impairment develop between annual impairment tests. The Company’s impairment review process compares the fair value of the reporting unit to its carrying value, including grantsthe goodwill related to the reporting unit. To determine the fair value of employee stock options,the reporting unit, the Company may use various approaches including an asset or cost approach, market approach or income approach or any combination thereof. These approaches may require the Company to make certain estimates and assumptions including future cash flows, revenue and expenses. These estimates and assumptions are reviewed each time the Company tests goodwill for impairment and are typically developed as compensation expensepart of the Company’s routine business planning and forecasting process. While the Company believes its estimates and assumptions are reasonable, variations from those estimates could produce materially different results. The Company did not recognize any goodwill impairments for the years ended June 30, 2021 and 2020.

Impairment of Long-Lived Assets

Long-lived assets, including intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. 

If the carrying amount of an asset exceeds its undiscounted estimated future cash flows, an impairment review is performed. An impairment charge is recognized in the financial statements based on their fair values. That expense will be recognized overamount by which the period during which an employee is required to provide services in exchange forcarrying amount of the award, known asasset exceeds the requisite service period (usually the vesting period).

Fair Value Measurements

In September 2006, the Financial Accounting Standards Board (FASB) introduced a framework for measuring fair value and expanded required disclosure aboutof the asset. Generally, fair value measurementsis determined using valuation techniques such as expected discounted cash flows or appraisals, as appropriate. Assets to be disposed of assetswould be separately presented in the balance sheet and liabilities.reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated or amortized. The Company adopted the standard for those financial assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the beginningbalance sheets.

Purchase Accounting for Transactions with Related Party

Purchase accounting for transactions with related party, entities under common control, are recorded at the historical carrying cost with no step up in basis to the fair market value of the 2013 fiscal year and the impact of adoption was not significant. FASB Accounting Standards Codification (ASC) 820 “Fair Value Measurements and Disclosures” (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants onare recognized.

Recent Accounting Pronouncements

The Company considers the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs)applicability and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs)impact of all Accounting Standards Updates (“ASU’s”). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1 - Unadjusted quoted prices in active marketsThere were no recent ASU’s that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of June 30, 2017. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include accrued payroll.

Recent accounting pronouncements

The Company has reviewed recent accounting pronouncements issued by the FASB (including its EITF), the AICPA, and the SEC and did not or are not believed by managementexpected to have a material impact on the Company’s financial statements.

our balance sheets or statements of operations.

 -37-F-12 

4. Related Party Loan

4.Intangible Assets

The Company’s intangible assets consist of intellectual property acquired from LAT Pharma, was givenInc. and are amortized over their estimated useful lives. The following is a zero-interest bearing loan bysummary of the company’s General Partner, Jonathan Adams in the amount of $5,000 in August 2015 and $5,000 in November 2015.  The total of $10,000 was outstanding when the Company merged with LAT Pharma. On June 16, 2017, the Company was given an additional $25,000 zero-interest bearing loan by Jonathan Adams.  Asintangible assets as of June 30, 2017, the Company has an outstanding loan of $35,000 payable on demand without interest2021 and 2020:

  June 30, 2021  June 30, 2020 
       
Intellectual Property $2,293,770  $2,293,770 
Less Accumulated Amortization  (1,197,921)  (968,544)
Intellectual Property, Net $1,095,849  $1,325,226 

Amortization expense amounted to the CEO, Jonathan Adams. 

On March 23, 2017, Jonathan Adams agreed to defer the payment of his salary debt of $180,555 until December 31, 2019, through the issuance of a Promissory note.  The promissory note does not carry any interest charge as long as the amount is paid in full before December 31, 2019.  The salary debt has thereby been reclassified from a current liability to a long-term liability on the balance sheet. Any portion of the balance due under the note that remains unpaid after December 31, 2019 will accrue interest at a rate of 5% per annum until paid in full.

On March 23, 2017, Elliot Ehrlich agreed to forgive 50% of his salary debt of $444,056.25.  The adjusted salary debt is $222,028.13.  Elliot Ehrlich also agreed to defer the payment of his salary debt of $222,028.13 until December 31, 2019, through the issuance of a Promissory note.  The promissory note does not carry any interest charge as long as the amount is paid in full before December 31, 2019.  The salary debt has thereby been reclassified from a current liability to a long-term liability on the balance sheet and the salary debt forgiven has been reflected on the income statement as other income. Any portion of the balance due under the note that remains unpaid after December 31, 2019 will accrue interest at a rate of 5% per annum until paid in full.

As of June 30th, 2017, $312,133 payable to a consultant who is a related party is included in accounts payable and accrued expenses. 

5. Commitments and Contingencies

Office Lease

On January 1, 2014, the Company executed a lease agreement with Cummings Properties for the company’s office of 270 square feet at 100 Cummings Center, Suite 247-C, Beverly, MA 01915. The lease is for a term of five years from January 1, 2014 to December 30, 2018 and requires monthly payments of $369 ($4,428 annually$229,377 for each of the five years total aggregateended June 30, 2021 and 2020, respectively. The Company amortizes intellectual property over the expected original useful lives of $22,140).10 years.

Employment AgreementsEstimated future amortization expense is as follows:

Schedule of Future expected Amortization of intangible assets

Year ending June 30,   
2022  229,377 
2023  229,377 
2024  229,377 
2025  229,377 
2026  178,341 
Intellectual Property, Net $1,095,849 

5.Related Party Transactions

Asset Acquisition with NeurMedix

On April 11, 2016,27, 2021, the Company entered into an employment agreementAPA with CEONeurMedix and Acuitas, which are related party affiliates, pursuant to which the Company acquired certain assets from NeurMedix and assumed certain liabilities of NeurMedix, in exchange for consideration of cash and shares of common stock. The acquired assets include, among others, those related to certain drug candidates being developed by NeurMedix, including NE3107, a small molecule orally administered inhibitor of insulin resistance and the pathological inflammatory cascade, with a novel mechanism of action that has potential applications for treatment against Alzheimer’s Disease and Parkinson’s Disease.

Subject to the terms and conditions of the Asset Purchase Agreement, following the closing, the Company may be obligated to deliver contingent stock consideration to NeurMedix (or its successor). Previously, the Company was obligated to deliver contingent stock consideration to NeurMedix (or its successor) consisting of shares of the Company’s common stock having an aggregate value of up to $3.0 billion, subject to the achievement of certain clinical, regulatory and commercial milestones related to the drug candidates to be acquired by the Company from NeurMedix, and subject to a cap limiting each issuance of shares if such issuance would result in the beneficial ownership of NeurMedix and its affiliates exceeding 89.9999% of the Company’s issued and outstanding common stock. Pursuant to the Amendment No. 1 to the APA, dated May 9, 2021, the Company may now be obligated to deliver contingent stock consideration to NeurMedix (or its successor) consisting of up to 18 million shares of BioVie’s common stock, with 4.5 million shares issuable upon the achievement of each of the four milestones set forth in the APA, subject to a cap limiting the issuance of shares if such issuance would result in the beneficial ownership of NeurMedix and its affiliates exceeding 87.5% of the Company’s issued and outstanding common stock.

F-13 

On June 10, 2021, and pursuant to the Asset Purchase Agreement, the Company issued to Acuitas (as NeurMedix’s assignee) 8,361,308 shares of the Company’s common stock and made a cash payment of approximately $2.3 million, representing NeurMedix’s direct and documented cash expenditures to advance certain programs from March 1, 2021 through the closing date and cash payments to other third parties for expenses totaling approximately $4.0 million for due diligence, legal fees, transaction fees and the fairness opinion. Since the transaction was between entities under common control, there were no fair value adjustments of the purchased assets and the historical cost basis of the purchased assets was zero . The total consideration paid was expensed as research and development expense. 

Equity Transactions with Acuitas

On September 22, 2020, concurrent with the closing of the Company’s Offering, approximately $1.8 million was paid to Acuitas satisfying all amounts owed on the Debenture due September 24, 2020 held by the Company’s controlling stockholder, Acuitas.

Additionally, in connection with the close of the public offering on September 22, 2020, the Company issued an aggregate of 6,909,582 shares of Common Stock to Acuitas, representing (i) 5.4 million shares issuable pursuant to Acuitas’ rights under the Purchase Agreement dated July 3, 2018, as amended on June 24, 2019 and October 9, 2019; and the various extension letters as more fully described below; which resulted in a deemed dividend at the close of the public offering at price of $10 per share, consistent with the Company’s accounting policy; and (ii) the automatic exercise of 1.5 million warrants issued to Acuitas in connection with the Debenture financing at the par value of the Common Stock.

During the year ended June 30, 2021, the Company received additional draws under the Debenture totaling $436,000. The total draws as of September 22, 2020 were $1.7 million and the related total number of warrants issuable at $4.00 per share of common stock was 424,750 of which 328,250 warrants had been issued. In accordance with the Debenture agreements, as more fully described below; at September 22, 2020 upon the Company’s close of its public offering, all the warrants issued related to the debenture totaling 1,453,250 were mandatorily redeemed along with the additional 96,500 shares common stock issued to Acuitas.

The following paragraphs summarize the background of those financings and arrangements which were settled and redeemed on September 22, 2020.

On July 3, 2018, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Acuitas and certain other purchasers identified in the Purchase Agreement (together with Acuitas, the “Purchasers”) pursuant to which (i) the Purchasers agreed to purchase an aggregate of 2,133,332 shares of the our Series A Convertible Preferred Stock (the “Preferred Stock”) at a price per share of $1.50 per share of Preferred Stock (the “Initial Sale”) and (ii) we agreed to issue warrants (the “Warrants”) to purchase 1,706,666 shares of common stock, each subject to the terms and conditions set forth in the Purchase Agreement, for an aggregate consideration of $3.2 million. We received $160,000 of the $3.2 million in April and May 2018 as prepaid equity. Acuitas also received an additional 6,667 Warrants in connection with the payoff of a note issued by us in favor of Acuitas. The Initial Sale and issuance of the Warrants occurred on July 3, 2018. In addition, Acuitas had the option to purchase up to an additional 1,600,000 shares of common stock at a price per share of $1.88, and warrants on the same terms as the Warrants, within two weeks following the one year anniversary of the closing of the Initial Sale (the “Subsequent Sale”) in the event that we did not obtain $3,000,000 of funding through various non-dilutive grants prior to the one year anniversary of the closing of the Initial Sale, less any federal or FDA grant funding received by the Company.

Acuitas is controlled by our Chairman and Chief Executive Officer, Terren Peizer and the Purchasers included Jonathan Adams. Adams, James Lang, Cuong Do and Michael Sherman, who are members of our Board.

F-14 

The Company’s agreement provides forPurchase Agreement contained customary representations and warranties. In connection with the disclosure schedule associated with the representations and warranties, we also disclosed customary information, including the following: (i) the existence of the Mallinckrodt petition before the U.S. Patent Trial and Appeal Board, (ii) our capitalization, (iii) our obligation to pay a three-year term with minimum annual base salarylow single digit royalty on the net sales of $250,000 per year. EffectiveBIV201 (continuous infusion terlipressin) to be shared among LAT Pharma LLC members, PharmaIN Corporation and The Barrett Edge, Inc. pursuant to the Agreement and Plan of Merger, dated April 11, 2016, by and between LAT Pharma LLC and us, (iv) our obligation to pay a low single digit royalty on net sales of all terlipressin products covered by specified patents up to a maximum of $200,000 per year pursuant to the (previous) CEO/CFO resigned.Technology Transfer Agreement, dated July 25, 2016, by and between us and the University of Padova (Italy), and (v) certain recent issuances of common stock by us. 

Each share of Preferred Stock automatically converted into 1 share of common stock upon the filing with the Secretary of State of the State of Nevada of a Certificate of Amendment to our Articles of Incorporation (the “Amendment”) on August 13, 2018 that increased the number of authorized shares of common stock to 800,000,000. The Amendment was approved by the written consent of the holders of more than a majority of our issued and outstanding common stock on July 3, 2018 and was filed with the Secretary of State of the State of Nevada 20 calendar days following the distribution of our Definitive Information Statement on Schedule 14 that was filed with the SEC on July 13, 2018.

Pursuant to a letter agreement dated June 24, 2019, Acuitas agreed to modify its existing rights under the Purchase Agreement so that:

-

Acuitas agreed to immediately exchange its existing 1,606,667 Warrants for common stock such that it will have effectively exercised its Warrants in full pursuant to a cashless exercise thereof at an assumed current market price of $45.00 per share and, as a result received an aggregate of 95% of the shares covered thereby, or 1,526,094 shares of common stock; 

 

-

Acuitas agreed to (i) waive its rights to a 50% adjustment of the purchase price of the Preferred Stock in the Initial Sale, the exercise price of the Warrants and the price per share in the Subsequent Sale in the event of certain reductions in the useful life of our current intellectual property rights, and (ii) effectively exercise its rights to purchase securities in a Subsequent Sale pursuant to a “cashless purchase” at an assumed current market price of approximately $11.25 per share, conditioned in each case on the listing of our common stock on Nasdaq or the raising of $2.0 million in additional funds in the form of another securities offering, in either case not later than November 30, 2019, which will result Acuitas having irrevocably waived its rights to an adjustment in the purchase price of the Preferred Stock in the Initial Sale and the exercise price of the Warrants and the purchase price of per share in the Subsequent Sale upon the issuance by us of an aggregate of 1,339,958 shares of common stock (the “Subsequent Sale Shares”) to Acuitas, which is expected to occur concurrently with the closing of our potential public offering and listing on Nasdaq;

-Acuitas shall in exchange for the foregoing agreements and waivers have the option to purchase additional shares of common stock and warrants to purchase one share of common stock for each share of common stock purchased during the period from September 1, 2019 to November 30, 2019 at the then-effective purchase price of the Preferred Stock in the Initial Sale (the “Funding Option”), provided that any shares issued pursuant to any exercise of the Funding Option will reduce share-for-share the amount of shares issued pursuant to the deemed exercise of its rights to purchase securities in a Subsequent Sale mentioned above.

Convertible Debenture Transaction with Acuitas

On September 24, 2019, the Company entered into a Securities Purchase Agreement (the “2019 Purchase Agreement”) with Acuitas pursuant to which (i) Acuitas agreed to purchase a 10% OID Convertible Delayed Draw Debenture due September 24, 2020 for an aggregate commitment amount of up to $2.0 million, and (ii) the Company issued 1,125,000 shares (the “Commitment Shares”) of the Company’s common stock and warrants (the “Commitment Warrants”) to purchase an equal number of shares, each subject to the terms and conditions set forth in the 2019 Purchase Agreement. The Debenture accrues additional principal at the rate of 6% per annum and interest at the rate of 10% per annum, is convertible into shares of common stock at $4.00 per share prior to the completion of the company’s planned public offering of units (the “Public Offering”) or, subsequent to the closing of the Public Offering, the lower of $4.00 or 80% of the offering price per unit to the public in the Public Offering and are mandatorily redeemable upon such closing at 100% of the accrued principal amount and unpaid interest to the date of redemption. The Commitment Warrants are five-year warrants, exercisable upon the earlier of the effectiveness of the Company’s current reverse stock split or December 1, 2019, at an amount equal to the lower of $4.00 or 80% of the offering price per unit to the public in the Public Offering. Upon entering into the 2019 Purchase Agreement, the Company drew an initial $500,000 under the Debenture and in accordance with the 2019 Purchase Agreement, Acuitas received an additional 125,000 warrants (the “Bridge Warrants”) having the same terms as the Commitment Warrants.

 -38-F-15 

Any future draws under the Debenture, which may be made from and after October 15, 2019, November 15, 2019 and December 15, 2019 in equal tranches of $500,000 each, will entitle Acuitas to receive additional Bridge Warrants in equal amount upon such funding. In addition, the 2019 Purchase Agreement provides that, should the underwriters in the Public Offering exercise their option to purchase additional securities during the 45 days following closing and the issuance of such securities would result in Acuitas’ beneficial ownership (on a fully diluted basis) of shares of common stock being below 60%, Acuitas shall be issued a number of additional shares of common stock and warrants having the same terms as the Commitment Warrants to result in its beneficial ownership (on a fully diluted basis) of shares of common stock equaling 60%.

The issuance of 1,125,000 shares of the Company’s commons stock and warrants to purchase an equal amount number of shares, to its controlling stockholder for the Bridge Financing was accounted for as a deemed dividend due to its related party nature and $17.1 million representing the excess of the fair value of the consideration given for the financing, net of debt discount; was recorded in accumulated deficit for the year ended June 30, 2020, accordingly. A debt discount of $500,000 against the debenture was recorded which will be amortized over the term of the debenture using the effective interest method.

The Company received draws under the Debenture that totaled approximately $1.3 million during the year ended June 30, 2020. The total interest expense related to the draws under the Debenture was approximately $99,000 for the year ended June 30, 2020. On April 1, 2020, the Company entered an amendment to modify the payment of accrued interest amounts under the original terms of the Debenture to capitalize all such amounts as would otherwise accrue on the Debenture. On January 4, 2020, payment of $13,487 accrued interest due was paid through the issuance of 4,422 shares of the Company’s common stock. Acuitas and the Company continue to discuss the need and timing for some or all the remaining draws under the Debenture Agreement. Subsequent to the initial $500,000 draw on September 24, 2019, the Company received draws that totaled $813,000 as July 13, 2020, and accordingly; the Company issued additional Bridge Warrants to purchase 203,250 shares of common stock to its controlling stockholder under the terms of the Bridge Financing. Accordingly, on April 16, 2020, the Company recorded the warrants to purchase 125,000 common stock related to the second $500,000 draw under the debenture as a derivative warrant liability as of June 30, 2020. The Company recorded the warrants related to the draws totaling $313,000 to purchase 78,250 common shares as derivative liabilities.

Pursuant to the 2019 Purchase Agreement, Acuitas has agreed to further modify its existing rights under the Purchase Agreement dated July 3, 2018 with the Company so that Acuitas’ previous agreement in June 2019 to waive its rights to a 50% adjustment of the purchase price of the Preferred Stock in the July 2018 transaction, the exercise price of the warrants in such transaction and the price per share in a Subsequent Sale in the event of certain reductions in the useful life of our current intellectual property rights, and effectively exercise its rights to purchase securities in a Subsequent Sale pursuant to a “cashless purchase” at an assumed current market price of approximately $11.25 per share, conditioned in each case on the listing of the Company’s common stock on Nasdaq or the raising of $2.0 million in additional funds in the form of another securities offering, in either case not later than November 30, 2019, such that Acuitas will have irrevocably waived its rights to an adjustment in the purchase price of the Preferred Stock in the Initial Sale and the exercise price of the Warrants and the purchase price of per share in the Subsequent Sale upon the issuance by us of an aggregate of 2,679,916 shares of common stock and 2,679,916 warrants having the same terms as the Commitment Warrants to Acuitas, upon the closing of the Public Offering.

Pursuant to an amendment to the 2019 Purchase Agreement dated October 9, 2019, Acuitas agreed to modify its existing rights under the 2019 Purchase Agreement so that:

-The Commitment Warrants (and related warrants issued upon the first draw under the Debenture) were replaced with warrants having similar terms, but which are automatically exercised upon the closing of the offering at an exercise price equal to the par value of the common stock;

F-16 

6.Income Taxes-Acuitas’ existing rights under the Purchase Agreement dated July 3, 2018 with the Company were further amended so that the number of Subsequent Sale Shares would be multiplied by four (in lieu of the changes to the Purchase Agreement originally provided for in the 2019 Purchase Agreement); and

-The provisions of the 2019 Purchase Agreement providing that, should the underwriters in the offering exercise their option to purchase additional securities during the 45 days following closing and the issuance of such securities would result in Acuitas’ beneficial ownership (on a fully diluted basis) of shares of common stock being below 60%, Acuitas will be issued a number of additional shares of common stock and warrants having the same terms as the Commitment Warrants to result in its beneficial ownership (on a fully diluted basis) of shares of common stock equaling 60% have been modified such that, upon the exercise of such option by the underwriters, the Company will issue to Acuitas a number of securities that will result in Acuitas’ fully diluted beneficial ownership after the exercise of such option being the same as prior thereto.

Deferred taxes are recorded for allOn July 14, 2020, the Company, entered into a further extension of its letter agreements dated April 8, 2020, that furthered extended its letter agreement dated February 10, 2020 with Acuitas regarding Acuitas’ previous agreement to modify its existing temporary differencesrights under the Purchase Agreement dated July 3, 2018 with the Company so that its June 2019 waiver of its rights to a 50% adjustment of the purchase price applicable to its initial investment in the Company and the exercise price of the warrants received in such transaction and the price per share should it exercise certain rights to purchase additional securities in the event of certain reductions in the useful life of the Company’s assetsintellectual property rights and liabilities for income taxcommitment to purchase such securities upon the closing of the Company’s planned public offering of shares of Class A common stock (the “Common Stock”) as described in its Registration Statement on Form S-1 (File No. 333-231136) and financial reporting purposes. Duecommitment to purchase such additional securities would remain effective until October 31, 2020, and accordingly Acuitas shall be entitled to receive an aggregate of 5,359,832 shares of Common Stock at such closing. In addition, the parties agreed that certain draws under the Company’s current bridge financing with Acuitas were to be made based with respect to the valuation allowanceCompany’s ongoing capital requirements and current market conditions, notwithstanding certain scheduled availability dates set forth in the 10% OID Convertible Delayed Draw Debenture issued in connection therewith. The letter agreement of July 14, 2020 also confirmed the understanding between the Company and Acuitas regarding certain amounts funded to BioVie that were intended as “partial draws” of credit available under the Debenture which, as of the date hereof aggregated $813,000 in aggregate principal amount in additional to amounts initial funded under the Debenture. Accordingly, such “partial draws” shall accrue additional principal as amounts otherwise funded pursuant to the original schedule of draws included in the Debenture (as modified by the letter agreement between BioVie and Acuitas dated April 1, 2020 regarding the capitalization of interest otherwise payable) and shall entitle Acuitas to receive a pro rata amount of Bridge Warrants.

6.Fair Value Measurements

On September 22, 2020, concurrent with the closing of the Offering; the warrants related to derivative liabilities were automatically exercised in full and the convertible Debenture was paid off in cash expiring the conversion option. The fair value of the derivative liabilities – warrants and derivative liability – conversion option on convertible Debenture prior to redemption at September 22, 2020 was $13.1 million, and the change in the fair value of $8.3 million from June 30, 2020 was recorded in the accompanying Statements of Operations. At September 22, 2020, the derivative liabilities, both the warrants and expired conversion option totaling $ 13.1 million were then recorded as additional paid in capital upon automatic exercise of the warrants and payoff of the Debenture.

F-17 

At June 30, 2021 and 2020, the estimated fair value of derivative liabilities measured on a recurring basis are as follows:

  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 $  $  $  $ 
    
  Fair Value Measurements at 
  June 30, 2020 
  Level 1  Level 2  Level 3  Total 
             
Derivative liability – Warrants $  $  $16,411,504  $16,411,504 
Derivative liability -Conversion option on convertible debenture        5,000,800   5,000,800 
Total derivatives $  $  $21,412,304  $21,412,304 

The following table presents the activity for deferred tax assets, as noted below, there were no net deferred tax benefit or expenseliabilities measured at fair value using unobservable inputs for the year ended June 30, 2017.2021 and 2020:

  Derivative
liabilities –
Warrants
  Derivative
liability –
Conversion
Option on
Convertible
Debenture
 
       
Balance at July 1, 2019 $  $ 
Additions to level 3 liabilities  9,561,652   2,638,966 
Change in in fair value of level 3 liability  6,849,852   2,361,834 
Transfer in and/or out of Level 3      
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 June 30, 2021 $  $ 

There is no currentDerivative liability – Warrants

The Company accounts for stock purchase warrants as either equity instruments or deferred income tax expense or benefit allocated to continuing operations forderivative liabilities depending on the year ended June 30, 2017.

The provision for income taxes is different from that which would be obtained by applying the statutory federal income tax rate to income before income taxes. The items causing this difference are as follows:

  June 30, 2017 June 30, 2016
Tax expense (benefit) at U.S. statutory rate $(528,229) $(146,889)
State income tax expense (benefit), net of federal benefit  (42,074)  (21,659)
Effect of non-deductible expenses        
Other        
Change in valuation allowance  570,303   168,548 
  $—    $—   

The tax effects of temporary differences that give rise to significant portionsspecific terms of the deferred tax assets and deferred tax liabilities at June 30, 2017warrant agreements. Under applicable accounting guidance, stock warrants that are precluded from being indexed to the Company’s own stock because of full-rachet anti-dilution provisions or the adjustments to the strike price due to an occurrence of a future event; are accounted for as follows:

Deferred tax assets (liability), noncurrent:    
Net operating loss $570,303 
Valuation allowance  (570,303) 
  $—   

Change in valuation allowance:

Balance, June 30, 2016 $391,848 
Increase in valuation allowance  570,303 
Balance, June 30, 2017  962,151 

Since managementderivative financial instruments. The stock warrants issued September 24, 2019 were not considered indexed to the Company’s own stock because of the Company believes that it is more likely than not thatadjustment to strike price, an occurrence of a future event such as the net deferred tax assets will not provide future benefit, the Company has established a 100 percent valuation allowance on the net deferred tax assets as of June 30, 2017.

As of June 30, 2017, the Company had federal and state net operating loss carry-forwards totaling approximately $2,335,009 which begin expiring in 2022.

Company’s pending capital raise. 

 -39-F-18 

7. PurchaseThe warrants associated with the level 3 liability were issued on September 24, 2019 and were valued using the Black-Scholes-Merton model. The valuation at June 30, 2020 used the following assumptions: stock price of LAT Pharma$14, exercise price of $4.00, term of 5 yearexpiring April 2025, volatility of 76.61%, dividend yield of 0%, and risk-free interest rate of 0.29%.

On April 11, 2016, the Company entered into and consummated an Agreement and Plan of Merger (the “Merger Agreement”), with LAT Acquisition Corp., a Nevada corporation and wholly-owned subsidiaryThe valuation at September 22, 2020 of the warrants associated with equity financing prior to their automatic exercise in full used were the following assumptions: stock price of $9.55, exercise price of $4.00, term of 4 year expiring September 2024, volatility of 79.69%, dividend yield of 0%, and risk-free interest rate of 0.21%. (See note 5 “Related Party Transactions”)

Derivative liability – Conversion option in convertible debenture

The Company (“Acquisition”) and LAT Pharma, LLC an Illinois limitedrecognized a derivative liability company (“LAT”). Pursuant tofor the termsconversion option of the Merger Agreement, Acquisition merged with and$2 million 10% OID Convertible Delayed Draw Debenture; which may be convertible into LAT in a statutory triangular merger (the “Merger”) with LAT surviving as a wholly-owned subsidiary of the Company. As consideration for the Merger, the Company issued the interest holders of LAT (the “LAT Holders”) an aggregate of 39,820,000 shares of our Common Stock issued to the LAT Holders in accordance with their pro rata ownership of LAT membership interests prior to the Merger. Following the Merger, the Registrant will continue the development of LAT’s lead clinical therapeutic candidate Continuous low-dose Infusion (CI) Terlipressin.

Immediately prior to the Merger, the Company had 87,210,000 shares of Common Stock issued and outstanding. In connection with the Merger, certain shareholders of the Company collectively agreed to retire and cancel an aggregate of 39,869,999 shares of Common Stock. Following the consummation of the Merger, the issuance of the Merger Shares of the 39,820,000 shares of Common Stock, the Company had 87,160,001 shares of Common Stock issued and outstanding and the LAT Holders beneficially own 39,820,000 shares or approximately forty-six percent (46%) of such issued and outstanding Common Stock.

Under the purchase method of accounting, the transaction was valued for accounting purposes at $2,389,200, which was the estimated fair value of the consideration paid by the Company. The estimate was based on the consideration paid of 39,820,000 shares of common stock valued based onat $4.00 per share prior to the completion of an offering or, subsequent to the closing of the offering, the lower of $4.00 or 80% of the offering price on 04/11/2016per unit to the public in such offering and are mandatorily redeemable upon such closing at 100% of $0.06 per share.the accrued principal amount and unpaid interest to the date of redemption. The valuation at June 30, 2020 used the following assumptions: stock price of $14, conversion price of $4.00, term of 0.25 year expiring September 2020, volatility of 62.47%, dividend yield of 0%, and risk-free interest rate of 0.16%.

The valuation at September 22, 2020 used the following assumptions: stock price of $9.55, conversion price of $4.00, term of 0.008 year expiring September 2020, volatility of 45.49%, dividend yield of 0%, and risk-free interest rate of 0.01%.

 

The assets and liabilities of LAT Pharma, Inc. were recorded at their respective fair values as ofrelated Debenture was paid off in cash on September 22, 2020, expiring the closing date of the Merger Agreement, and theconversion option. (See note 5 “Related Party Transactions”)

7.Equity Transactions

Stock Options

The following table summarizes these values based on the balance sheet at April 11, 2016. 

$2,303,682  Assets Purchased
 260,193  Liabilities Assumed
 2,043,489  Net Assets Purchased
 2,389,200  Purchase Price
$345,711  Goodwill from Purchase

Intangible asset detail 

$2,293,770  Intangible Intellectual Property
 345,711  Goodwill
$2,639,481  Intangible Asset from Purchase

Under the 338(h)(10) election, all goodwill and intangibles relatedactivity relating to the acquisition of LAT Pharma will be fully deductibleCompany’s stock options for tax purposes.the years ended June 30, 2021 and 2020:

  Options  Weighed-
Average
Exercise
Price
  Weighted
Remaining
Average
Contractual
Term
  Aggregate
Intrinsic
Value
 
Outstanding at June 30, 2019  58,000  $12.50   5.2  $273,000 
Granted  10,400   3.88   4.5   105,200 
Options Exercised or Forfeited  (8,000)         
Outstanding at June 30, 2020  60,400   11.06   4.2   352,600 
Granted  698,000   15.03   4.5   2,114,032 
Options Exercised or Forfeited  (3,200)  4.76       
Outstanding at June 30, 2021  755,200  $4.34   4.4  $2,569,232 
Exercisable at June 30, 2021  236,500  $13.85   4.2  $992,384 

The intangible intellectual property is amortized over 10 years.

  June 2017 December 2016
Intangible Assets subject to Amortization $2,293,770  $2,293,770 
Amortization Expense in current year $229,377  $51,036 
Accumulated Amortization at year end $280,413  $51,036 

The estimated Amortization expense for each fiscal year will be approximately $229,377 per year.

 -40-F-19 

8. Stock Options

In connection with the employment agreement signed with the Chief Financial Officer on April 11, 2016, Jonathan Adams was granted options to acquire 3 million shares exercisable at $0.06 per share, the closing price on that date. These Options Group A shall become vested and exercisable (i) as to 1 million shares on April 11, 2017, (ii) as to 1 million shares on April 11, 2018, and (iii) as to 1 million shares on April 11, 2019.

The fair market value of each option grant on the stock optionsdate of grant is estimated using the Black Scholes valuationBlack-Scholes Option – Pricing model and the Company usesreflecting the following methods to determine its underlying assumptions: expected volatilities areweighted-average assumptions:

  June 30, 2021  June 30, 2020 
Expected life of options (In years)  5   5 
Expected volatility  77.29%  73.74%
Risk free interest rate  0.39%  1.63%
Dividend Yield  0%  0%

Expected volatility is based on the historical volatilities of 3three comparable companies of the daily closing price of their respective common stock; the expected term of options granted is based on the average time outstanding method;stock and the risk free interest rate is based on the US Treasury bonds issued with similar life terms to the expected life of the grant.

The following key assumptions were used in the valuation modeloptions is based on historical data with respect to value stock option grants for each respective period:

Valuation Date 4/11/20164/11/20164/11/2016
Stock Price $0.06 $0.06 $0.06 
Exercise Price $0.06 $0.06 $0.06 
Term (expected term for options)  1.00  2.00  3.00 
Volatility  56.49% 58.45% 97.82%
Annual Rate of Quarterly Dividends  0.00% 0.00% 0.00%
Discount Rate - Bond Equivalent Yield  0.53% 0.70% 0.85%
Call Option Value ($Millions) $0.01 $0.02 $0.04 
Fair Value $13,467 $19,523 $36,489 

employee exercise periods. The Company issued stock options to consultantsaccounts for forfeitures as they are incurred.

The Company recorded stock-based compensation expense of approximately $3.0 million and board of directors for services provided to the company. The following key assumptions were used in the valuation model to value stock option grants for each respective period:

Valuation Date11/16/201612/18/201603/14/201705/02/2017
     
Stock Price $                 0.25 $                 0.21 $                 0.22 $                 0.23
Exercise Price $                 0.25 $                 0.21 $                 0.22 $                 0.23
Term (expected term for options)2.0002.0002.0002.000
Volatility43.12%43.12%40.02%36.76%
Annual Rate of Quarterly Dividends0.00%0.00%0.00%0.00%
Discount Rate - Bond Equivalent Yield1.02%1.15%1.40%1.27%
Call Option Value ($Millions) $               0.06 $               0.05 $               0.05 $               0.05
Fair Value $           30,919 $           15,646 $             5,143 $             4,951

 -41-

Stock option transactions under the Company’s plans$24,800 for the years ended June 30, 20172021 and 2016 are summarized below:2020, respectively. As of June 30, 2021, unrecognized stock-based compensation cost was $ 3.0 million which is expected to be recognized over a weighted-average period of approximately 2.5 years.

   Weighted 
  Weighed-AverageAggregate
  AverageRemainingIntrinsic
 SharesExerciseContractualValue
Options(Thousands)PriceTerm(Thousands)
Outstanding at July 1, 2015----
Granted3,0000.062-
Exercised----
Forfeited----
Outstanding at June 30, 20163,0000.062-
Granted1,0000.242-
Exercised----
Forfeited----
Outstanding at June 30, 20174,0000.102-

The compensation expense forfollowing is a summary of stock options outstanding and exercisable by exercise price as of June 30, 2021:

Exercise Price Outstanding Weighted Average Contract Life Exercisable
$2.80   7,200   3.6   7,200 
$3.75   4,800   2.6   4,800 
$6.25   1,600   2.3   1,600 
$7.50   25,600   4.6   25,600 
$8.75   1,600   2.8   1,600 
$9.54   800   4.3   800 
$9.90   800   4.3   800 
$12.50   4,000   1.6   4,000 
$13.91   691,600   4.5   172,900 
$25.00   1,600   1.3   1,600 
$26.25   4,400   0.8   4,400 
$27.50   800   0.1   800 
$28.75   1,600   1.1   1,600 
$31.25   4,000   0.4   4,000 
$42.09   4,800   4.6   4,800 
     755,200       236,500 

F-20 

Stock Warrants

The following table summarizes the yearwarrants activity during the years ended June 30, 2017 includes $35,392 related to2021 and 2020:

  Number of
Shares
  Weighted
Average
Exercise
Price
  Weighted
Average
Remaining
Life (Years)
  Aggregate
Intrinsic
Value
 
Outstanding and exercisable at June 30, 2019  124,667  $45.00   5.6  $1,202,678 
Granted  1,250,000  $4.00   4.7  $ 
Expired    $     $ 
Exercised    $     $ 
Outstanding and exercisable at June 30, 2020  1,374,667  $7.72   4.2  $13,799,331 
Granted  293,248  $6.61   4.8  $—   
Exercised  (55,904) $12.29   4.0  $—   
Exercised - Acuitas  (1,453,250) $4.00   4.0  $—   
Outstanding and exercisable at June 30, 2021  158,761  $10.37   3.1  $1,765,437 

Of the stock options described above. The Legal and Professional fee for theabove warrants, 9,391 expire in fiscal year endedending June 30, 2017 includes $56,660 related to the2022, 4,815 expire in fiscal year ending June 30, 2023, 2,714 expire in fiscal year ending June 30, 2025 and 141,841 expire in fiscal year ending June 30, 2026.

Issuance of common stock options described above.

Offeringsthrough exercise of Common Stock Options and Warrants

 

In September 2016,On July 28, 2020, the Company sold and issued an aggregate of 49,9992,210 shares of common stock inpursuant to a private placement transaction for aggregate gross proceedscashless exercise of approximately $5,000. Thestock options to purchase 3,200 shares at an average exercise price for the common stock was $0.10of $4.76 per share.

In October 2016,

On January 27, 2021, the Company sold and issued an aggregate of 225,000304 shares of common stock andpursuant to a cashless exercise of warrants to purchase 112,500320 shares at an average exercise price of $1.88 per share.

On March 23, 2021, the Company issued 27,000 shares of common stock pursuant to a cash exercise of warrants to purchase 27,000 shares at an average exercise price of $12.50 per share.

On March 24, 2021, the Company issued 14,324 shares of common stock pursuant to a cash exercise of warrants to purchase 14,324 shares at an average exercise price of $12.50 per share.

On April 19, 2021, the Company issued 724 shares of common stock pursuant to a cashless exercise of warrants to purchase 760 shares at an average exercise price of $1.88 per share.

On April 30, 2021, the Company issued 13,500 shares of common stock pursuant a cash exercise of warrants at $12.50 per share.

Issuance of Shares for Services

On January 2, 2020, the Company issued 11,200 shares of common stock to the members of the board of directors as part of the annual directors’ compensation. The share price on date of issuance was $3.50.

On January 2, 2020, the Company paid accrued interest on the Debenture of $13,487 to Acuitas through the issuance of 4,422 shares of common stock.

F-21 

Issuance of Stock Options

On November 10, 2019, the Company granted stock options to purchase 800 shares of common stock to an executive clinical team member as part of her compensation. The exercise price of the stock options is $6.25, are exercisable at any time and expire in 5 years from the date of issuance.

On January 19, 2020, the Company granted stock options to purchase 8,000 shares of common stock to the members of the board of directors as part of their annual director compensation. The exercise price of the stock options are $2.80, are exercisable at any time and expire in 5 years from the date of issuance.

On June 26, 2020, the Company issued 5,046 shares of common stock pursuant to a private placement transaction for aggregate gross proceedscashless exercise of approximately $45,000.stock options to purchase 8,000 shares at an exercise price of $6.25 per share.

On October 1, 2020 and 2019, the Company granted stock options to purchase 800 shares of common stock at each grant date to the Chief Financial Officer as part of her compensation. The purchase priceexercise prices of the stock options are $9.54 for the 2020 grant and $8.75 for the 2019 grant; are exercisable at any time and expire in 5 years from the date of issuance.

On October 13, 2020 and 2019, the Company granted stock options to purchase 800 shares of common stock, at each grant date; to a director as part of his annual director’s compensation. The exercise price of the stock options is $9.90 for the 2020 grant and $7.50 for the 2019 grant; are exercisable at any time and expire in 5 years from the date of grant.

On December 18, 2020, the Company granted stock options under the Company’s 2019 Omnibus Incentive Compensation Plan to purchase 691,600 shares of common stock to the members of the board as part of their annual compensation. The first 25% of the stock options vest on the grant date, and the remaining 75% vest over a 3-year period, on the first, second, and third anniversary of the grant date. The stock options were issued at an exercise price of $13.91 per share and expire 5 years from the date of grant.

On January 19, 2021, the Company granted stock option to purchase a total of 4,800 shares of common stock, granting 800 shares each to then Chief Operations Officer, an executive clinical team member and to four of its key consultants as part of their annual compensation. The exercise price of the options is $42.09 per share, are exercisable at any time and expire 5 years from the date of issuance.

Issuance of warrants

On July 13, 2020, the Company issued Warrants to purchase 203,250 shares of common stock to its controlling stockholder under the terms of the Bridge Financing. The warrants was $0.20 per share.were exercisable at an exercise price of $4 at any time from the date of issuance until 5 years from the date of issuance. (See Note 5 Related Party Transactions.)

On September 22, 2020, the Company issued warrants to purchase 89,998 shares of common stock to the underwriters of the Offering in connection with the close of the Offering of registered Common Stock The warrants are exercisable at an exercise price of $0.50$12.50 at any time from date of issuance until 5 years from the date of issuance.

In November 2016,

8.Commitments and Contingencies

Office Lease

On July 1, 2019, the Company’s office moved with Acuitas’ new offices to 2120 Colorado Avenue Ste 230, Santa Monica, CA 90404. There is no lease agreement for the new premises and the Company sold and issued an aggregatecontinues to accrue monthly lease payments of 250,000 shares of common stock and warrants to purchase 125,000 shares of common stock in a private placement transaction for aggregate gross proceeds of approximately $50,000. The purchase price$1,000 for the common stock and warrants was $0.20 per share. The warrants are exercisable at an exercise pricenew office under the terms of $0.50 at any time from date of issuance until 5 years from the date of issuance.previous month-to-month lease for the previous premises which may be cancelled upon 30 days’ written notice.

In December 2016,

On July 1, 2021, the Company sold and issued an aggregateassumed NeurMedix lease at 6165 Greewich Dr Suite 150, San Diego, CA 92122. The lease agreement requires monthly payments of 100,000 shares of common stock and warrants to purchase 50,000 shares of common stock in a private placement transaction for aggregate gross proceeds of approximately $20,000. The purchase price for the common stock and warrants was $0.20 per share. The warrants are exercisable at an exercise price of $0.50 at any time from date of issuance until 5 years from the date of issuance.$8,782.

 -42-F-22 

Challenge to US Patent

On April 30, 2018, we received notice that Mallinckrodt had petitioned the U.S. Patent and Trademark Office (“USPTO”) to institute an Inter Partes Review of our U.S. Patent No. 9,655,945 titled “Treatment of Ascites” (the “’945 patent”). Inter Partes Review is a trial proceeding conducted with the USPTO Patent Trial and Appeal Board (PTAB) to review the patentability of one or more claims of a patent. Such review is limited to grounds of novelty and obviousness on the basis of prior art consisting of patents and printed publications.

On November 13, 2019, the Patent Trial and Appeal Board of the United States Patent and Trademark Office (the “Board”) issued a written decision in the inter partes review (“IPR”) action that was brought by Mallinckrodt Pharmaceuticals Ireland Limited (“Mallinckrodt”) against BioVie Inc. (“BioVie” or “Company”). In January 2017,that action, Mallinckrodt sought to invalidate BioVie’s patent (U.S. Pat. No. 9,655,945, “Treatment of Ascites”) (the “’945 Patent”). In its decision, the Board determined that all claims of the ’945 Patent were not patentable because they were either anticipated or obvious in light of prior art. The Board also denied BioVie’s Motion to Amend the claims on similar grounds. The result of the Board’s decision is that the ’945 patent is no longer valid or enforceable. Acuitas Group Holdings, LLC was aware of this patent challenge when it purchased a majority ownership interest in the Company entered into a common stock purchase agreement (the “Purchase Agreement”in July 2018.

This ruling is unrelated to the Company’s Orphan drug designations for ascites and hepatorenal syndrome (“HRS”) with Aspire Capital Fund, LLC, an Illinois limited liability company (“Aspire Capital”), which providesremain unchanged. An Orphan drug that onis first-to-market typically receives 7 years of market exclusivity in the termsUnited States for the designated use(s). In addition, the ruling does not affect the Company’s rights in its pending patent application directed to proprietary liquid formulations of terlipressin for use in its planned Phase 2 and Phase 3 trials, subject to the conditions and limitations set forth therein, Aspire Capital is committed to purchaseFDA clearance, which could eventually provide up to an aggregate20 years of $12.0 million of shares of the Company’s common stock over the 30-month term of the Purchase Agreement. On execution of the Purchase Agreement, the Company agreed to sell to Aspire Capital 1,000,000 shares of common stock and warrants to purchase 500,000 shares of common stock for proceeds of $200,000. The Warrant Shares willpatent coverage in each have a five-year term and will be exercisable at $0.50 per share. Concurrently with entering into the Purchase Agreement, the Company also entered into a registration rights agreement with Aspire Capital (the “Registration Rights Agreement”),country in which the Company agreed to file one or more registration statements,seeks patent protection, such as permissible and necessary to register under the Securities Act of 1933, as amended (the “Securities Act”), registering the sale of the shares of the Company’s common stock that have been and may be issued to Aspire Capital under the Purchase Agreement.

Under the Purchase agreement, after the Securities and Exchange Commission (the “SEC”) has declared effective the registration statement referred to above, on any trading day selected by the Company, the Company has the right, in its sole discretion, to present Aspire Capital with a purchase notice (each, a “Purchase Notice”), directing Aspire Capital (as principal) to purchase up to 100,000 shares of the Company’s common stock per business day, up to $12.0 million of the Company’s common stock in the aggregate at a per share price (the “Purchase Price”) equal to the lesser of:

In addition, on any date on which the Company submits a Purchase Notice to Aspire Capital in an amount equal to 100,000 shares and the closing sale price of our stock is equal to or greater than $0.30 per share, the Company also has the right, in its sole discretion, to present Aspire Capital with a volume-weighted average price purchase notice (each, a “VWAP Purchase Notice”) directing Aspire Capital to purchase an amount of stock equal to up to 30% of the aggregate shares of the Company’s common stock traded on its principal market on the next trading day (the “VWAP Purchase Date”), subject to a maximum number of shares the Company may determine. The purchase price per share pursuant to such VWAP Purchase Notice is generally 95% of the volume-weighted average price for the Company’s common stock traded on its principal market on the VWAP Purchase Date.

The Purchase Price will be adjusted for any reorganization, recapitalization, non-cash dividend, stock split, or other similar transaction occurring during the period(s) used to compute the Purchase Price. The Company may deliver multiple Purchase Notices and VWAP Purchase Notices to Aspire Capital from time to time during the term of the Purchase Agreement, so long as the most recent purchase has been completed.

The Purchase Agreement provides that the Company and Aspire Capital shall not affect any sales under the Purchase Agreement on any purchase date where the closing sale price of the Company’s common stock is less than $0.10. There are no trading volume requirements or restrictions under the Purchase Agreement, and the Company will control the timing and amount of sales of the Company’s common stock to Aspire Capital. Aspire Capital has no right to require any sales by the Company, but is obligated to make purchases from the Company as directed by the Company in accordance with the Purchase Agreement. There are no limitations on use of proceeds, financial or business covenants, restrictions on future fundings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement. In consideration for entering into the Purchase Agreement, concurrently with the execution of the Purchase Agreement, the Company issued to Aspire Capital 2,400,000 shares of the Company’s common stock (the “Commitment Shares”). The Purchase Agreement may be terminated by the Company at any time, at its discretion, without any cost to the Company. Aspire Capital has agreed that neither it nor any of its agents, representatives and affiliates shall engage in any direct or indirect short-selling or hedging of the Company’s common stock during any time prior to the termination of the Purchase Agreement. Any proceeds that the Company receives under the Purchase Agreement are expected to be used for working capital and general corporate purposes.

 -43-

In March 2017, the Company sold and issued an aggregate of 500,000 shares of common stock and warrants to purchase 250,000 shares of common stock in a private placement transaction for aggregate gross proceeds of approximately $100,000. The purchase price for the common stock and warrants was $0.20 per share. The warrants are exercisable at an exercise price of $0.50 at any time from date of issuance until 5 years from the date of issuance.

In May 2017, the Company sold and issued an aggregate of 240,000 shares of common stock and warrants to purchase 120,000 shares of common stock in a private placement transaction for aggregate gross proceeds of approximately $60,000. The purchase price for the common stock and warrants was $0.25 per share. The warrants are exercisable at an exercise price of $0.75 at any time from date of issuance until 5 years from the date of issuance.

The following table summarizes the warrants that have been issued:

Aggregate Number of Warrants IssuedExercise PriceIssue DateExpiration Date
5,000,000$0.50April 2013April 2018
112,500$0.50October 2016October 2021
125,000$0.50November 2016November 2021
50,000$0.50December 2016December 2021
500,000$0.50January 2017January 2022
250,000$0.50March 2017March 2022
120,000$0.75May 2017May 2022

9. Renegotiated Debt

On March 23, 2017, Barrett Ehrlich agreed to defer the payment of his consulting fee debt of $173,333.33 until December 31, 2019, through the issuance of a Promissory note.  The promissory note does not carry any interest charge as long as the amount is paid in full before December 31, 2019.  The consulting fee debt has thereby been reclassified from a current liability to a long-term liability on the balance sheet. Any portion of the balance due under the note that remains unpaid after December 31, 2019 will accrue interest at a rate of 5% per annum until paid in full.

On March 23, 2017, Elliot Ehrlich agreed to forgive 50% of his salary debt of $444,056.25.  The adjusted salary debt is $222,028.13.  Elliot Ehrlich also agreed to defer the payment of his salary debt of $222,028.13 until December 31, 2019, through the issuance of a Promissory note.  The promissory note does not carry any interest charge as long as the amount is paid in full before December 31, 2019.  The salary debt has thereby been reclassified from a current liability to a long-term liability on the balance sheet and the salary debt forgiven has been reflected on the income statement as other income. Any portion of the balance due under the note that remains unpaid after December 31, 2019 will accrue interest at a rate of 5% per annum until paid in full.

On March 23, 2017, Jonathan Adams agreed to defer the payment of his salary debt of $180,555.64 until December 31, 2019, through the issuance of a Promissory note.  The promissory note does not carry any interest charge as long as the amount is paid in full before December 31, 2019.  The salary debt has thereby been reclassified from a current liability to a long-term liability on the balance sheet. Any portion of the balance due under the note that remains unpaid after December 31, 2019 will accrue interest at a rate of 5% per annum until paid in full.

10. Subsequent Events

In August 2017, the Company sold and issued an aggregate of 2,318,182 shares of common stock including 1,500,000 of common stock for services, and including 818,182 shares of common stock and warrants to purchase 409,091 shares of common stock (subject to adjustment) in private placement transactions to various purchasers including existing shareholders and directors for aggregate gross proceeds of approximately $180,000. The purchase price for the common stock and warrants in such private placement transactions was $0.44 per Unit, each Unit consisting of 2 common shares priced at $0.22 per share and one warrant. The warrants in such private placement transactions are exercisable at an exercise price of $0.60 at any time from the date of issuance until 5 years from the date of issuance.

 -44-

ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A(T).CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the fiscal period ending June 30, 2017 covered by this Annual Report on Form 10-K. Based upon such evaluation, the Chief Executive Officer and acting Chief Financial Officer has concluded that, as of the end of such period, the Company’s disclosure controls and procedures were not effective as required under Rules 13a – 15(e) and 15d – 15(e) under the Exchange Act. This conclusion by the Company’s Chief Executive Officer and Chief Financial Officer does not relate to reporting periods after June 30, 2017.

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rue 13a-15(f) and 15d – 15(f) of the Exchange Act) of the Company. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States, of America.

The Company’s internal control over financial reporting includes those policies and procedures that (i) pertainif a patent issues from a patent application according to the maintenancepatent laws of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.each issuing country. 

 -45-Royalty Agreements

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subjectPursuant to the risk that controls may become inadequate becauseAgreement and Plan of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

Management, under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework inInternal control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the Company’s internal control over financial reporting was not effective as of June 30, 2017 under the criteria set forth in theInternal Control – Integrated Framework.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management has determined that material weaknesses exist due to a lack of formalized controls and procedures as well as a lack of segregation of duties, as well as the absence of an independent audit committee chair, resulting from the Company’s limited resources.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the fourth fiscal quarter ended June 30, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 -46-

Part III

ITEM 10.      DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Set forth below is certain information concerning the directors and executive officers of the Company.

NameAgePosition
Jonathan Adams54Chief Executive Officer and Chief Financial Officer
Amrit Shahzad60President and Corporate Secretary
Cuong Do51Independent Director
Jim Lang53Independent Director
Julie Anderson60Independent Director
Hari Kumar61Independent Director

According to our Bylaws, the directors shall be elected at the annual meeting of the stockholders and each director shall be elected to serve until his successor shall be elected and shall qualify. A director need not be a stockholder. Directors shall not receive any stated salary for their services as directors or as members of committees, but by resolution of the Board a fixed fee and expenses of attendance may be allowed for attendance at each meeting. The Bylaws shall not be construed to preclude any director from serving the Company in any other capacity as an officer, agent or otherwise, and receiving compensation therefor.

There are no familial relationships among any of our Directors or officers. Jim Lang currently also serves as a Director at OptimizeRX, a US reporting company that is listed on the Nasdaq stock exchange. None of our other Directors or officers is or has been a Director or has held any form of directorship in any other U.S. reporting companies except as mentioned above. None of our Directors or officers has been affiliated with any company that has filed for bankruptcy within the last five years. The Company is not aware of any proceedings to which any of the Company’s Officers or Directors, or any associate of any such officer or Director, is a party that are adverse to the Company. We are also not aware of any material interest of any of our officers or directors that is adverse to our own interests.

Information

Mr. Jonathan Adams has served as the Company’s Chief Executive Officer and Chief Financial Officer since it acquired LAT Pharma LLCMerger entered into on April 11, 2016. He founded2016 between our predecessor entities, LAT Pharma LLC and served asNanoAntibiotics, Inc., BioVie is obligated to pay a low single digit royalty on net sales of BIV201 (continuous infusion terlipressin) to be shared among LAT Pharma Members, PharmaIn Corporation, and The Barrett Edge, Inc.

The Company and PharmaIN Corporation, LAT Pharma’s former partner focused on the development of new modified drug candidates in the same therapeutic field but not including BIV201, had agreed to pay royalties equal to less than 1% of future net sales of each company’s ascites drug development programs, or if such program is licensed to a third party, less than 5% of each company’s net license revenues. On December 24, 2018, the Company returned its Chief Executive Officer priorpartial ownership rights to its acquisition. Mr. Adams has over 26 yearsthe PharmaIN modified terlipressin development program and simultaneously paid the remaining balance due on a related debt. PharmaIN, Corp. rights to our program remain unchanged. Additionally the Company obligation to pay a low single digit royalty on the net sales of biopharmaceutical industry experience, including corporate finance, company acquisitions and licensing deals, marketing and sales support. At Searle Pharmaceuticals he was a member of the global launch team for Celebrex, and he has worked on launching numerous new drugs and medical devices. Mr. Adams earned a BS at Cornell University and an MBA at the Tuck School at Dartmouth.

 -47-

Ms. Amrit Shahzad has served as the Company’s President and Secretary since it acquiredBIV201 (continuous infusion terlipressin) to be shared among LAT Pharma LLC onmembers, and The Barrett Edge, Inc. pursuant to the Agreement and Plan of Merger, dated April 11, 2016. Ms. Shahzad2016, by and between LAT Pharma LLC. The Company has worked inan obligation to pay a low single digit royalty on net sales of all terlipressin products covered by specified patents up to a maximum of $200,000 per year pursuant to the biopharmaceutical industry for more thanTechnology Transfer Agreement, dated July 25, years. Prior to starting her own consulting firm in 2014, she worked in a variety of leadership roles at Roche, Amgen2016, by and Ikaria,between us and has been on the board of several startup companies. She has extensive business and corporate development experience including corporate venture funds. Her transactional experience spans multiple therapeutic areas, technologies, and platforms. Ms. Shahzad holds a medical degree (MBBS) from Lady Hardinge Medical College in New Delhi, India, and an MBA from Rutgers University.

Mr. Cuong Do is currently Executive Vice President, Global Strategy Group, at Samsung. Mr. Do helps to set the strategic direction for Samsung Group’s diverse business portfolio. He was previously the Chief Strategy Officer for Merck, a leading US pharmaceuticals company, Tyco Electronics, and Lenovo. Mr. Do is a former senior partner at McKinsey & Company, where he spent 17 years and helped build the healthcare, high tech and corporate finance practices. He holds a BA from Dartmouth College, and an MBA from the Tuck School of Business at Dartmouth.

Mr. Jim Lang is an accomplished senior executive, advisor, and investor with broad industry expertise. Most recently, Jim was CEO of Decision Resources Group, which he transformed into a leading healthcare data and analytics firm. Prior to that, Jim was CEO of IHS Cambridge Energy Research Associates (IHS CERA), a recognized leader in energy industry subscription information products, and formerly the President of Strategic Decisions Group (SDG), a leading global strategy consultancy. Mr. Lang holds a BS summa cum laude in electrical and computer engineering from the University of New Hampshire and an MBA with Distinction from the Tuck School of Business. Jim Lang currently also serves as a Director at OptimizeRX, a Nasdaq listed company.Padova (Italy).

Ms. Julie Anderson has decades of pharmaceutical industry marketing and new drug commercialization experience. She most recently served Catheter Connections, Inc. as its Vice President of Marketing until the company was sold. Previously she was Senior Director of Marketing for Durata Therapeutics, Inc. contributing to company growth which ledPursuant to the company being acquiredTechnology Transfer Agreement entered into on July 25, 2016 between BioVie and the University of Padova (Italy), BioVie is obligated to pay a low single digit royalty on net sales of all terlipressin products covered by Actavis (now Allergan) in 2014 inUS patent no. 9,655,645 and any future foreign issuances capped at a deal valued at about $675 million. Previously she worked for Sanofi-Synthelabo, Inc., Bayer Pharmaceuticals, and G.D. Searle. She originally trained as a nurse and earned a Mastersmaximum of Management at Northwestern University.

Hari Kumar, PhD held positions of increasing responsibility at Roche Pharma culminating in serving as Global Business Development Director, and in 2007 assumed the role of Chief Business Officer for Amira Pharmaceuticals. He led the sale of Amira to Bristol-Myers Squibb in 2011 for $475 million. He then served as Chief Executive Officer (CEO) for Panmira Pharmaceuticals LLC, which is developing anti-inflammatory compounds, and in 2013 became CEO for Adheron Therapeutics, which Roche Pharma acquired in 2015 for $580 million. Dr. Kumar earned a PhD in immunology in 1984.

Qualifications

Jonathan Adams’s qualifications to serve on our Board of Directors are primarily based on his founding of LAT Pharma LLC and his over 26 years of biopharmaceutical industry experience. As Chief Executive of LAT Pharma LLC, Mr. Adams worked to develop CIPT Technology and secured Orphan Drug Designation for a BIV201 analogue (this new drug candidate is no longer in development). Mr. Adams’s biopharmaceutical experience includes work in corporate finance, company acquisitions and licensing deals, marketing and sales support.

$200,000 per year.

 -48-F-23 

Amrit Shahzad’s qualifications to serve on our Board of Directors are primarily based on her more than 25 years of biopharmaceutical industry experience. Prior to starting her own consulting firm in 2014, Ms. Shahzad worked in a variety of leadership roles at Roche, Amgen and Ikaria, and has been on the board of several startup companies. She has extensive business and corporate development experience including corporate venture funds. Her transactional experience spans multiple therapeutic areas, technologies, and platforms.

Cuong Do’s qualifications to server on our Board of Directors are primarily based on his decades of experience as an executive in the pharma, biotech, and other high technology industries. He was previously the Chief Strategy Officer for Merck, a leading US pharmaceuticals company, Tyco Electronics, and Lenovo. Mr. Do is a former senior partner at McKinsey & Company, where he spent 17 years and helped build the healthcare, high tech and corporate finance practices.

Jim Lang’s qualifications to server on our Board of Directors are primarily based on his decades of experience as a strategy consultant, broad industry expertise, and senior-level management experience running several healthcare and information technology companies. This includes his experience as CEO of Decision Resources Group, CEO of IHS Cambridge Energy Research Associates (IHS CERA), and President of Strategic Decisions Group (SDG), a leading global strategy consultancy.

Julie Anderson’s qualifications to server on our Board of Directors are primarily based on her decades of successful pharmaceutical marketing and new drug commercialization expertise. For Searle she led the global launch of the multi-billion dollar drug Celebrex, and more recently for Durata Therapeutics she led the marketing efforts which resulted in a sale of the company for about $675 million. Originally trained as a critical care nurse, Julie treated patients at risk of death due to complications caused by chronic liver cirrhosis, and deeply understands the unmet medical need targeted by BioVie.

Hari Kumar’s qualifications to server on our Board of Directors are primarily based on his decades of biopharma industry experience including serving as the chief executive officer at multiple companies, extensive technical and business knowledge, and outstanding track record for delivering value to investors. He led the sale of Amira to Bristol-Myers Squibb in 2011 for $475 million, and as CEO for Adheron Therapeutics, he led the sale of this company to Roche Pharma for $580 million in 2015.

AUDIT COMMITTEE

We do not have an audit committee or an audit committee financial expert. Our corporate financial affairs are simple at this stage of development and each financial transaction can be viewed by any officer or Director at will.

CODE OF ETHICS

We have adopted a code of ethics meeting the requirements of Section 406 of the Sarbanes-Oxley Act of 2002. We believe our code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of violations; and provide accountability for adherence to the provisions of the code of ethic. Our code of ethics is filed as an exhibit to this Form 10-K.

 -49-

ITEM 11.EXECUTIVE COMPENSATION

We have not paid any compensation to any of our executive officers, however, we did accrue the Chief Executive Officer’s salary per the employment agreements effective July 1, 2013 and subsequently April 11, 2016.

Summary Compensation Table

                   
  Annual Compensation Long Term Compensation      
                 
Name and Principal Position Year (1) Salary Bonus Stock Awards Option Awards Non-Equity Incentive Plan Compensation Nonqualified Deferred Compensation Earnings All Other Compensation Total
Jonathan Adams                                    
Chief Executive Officer and Chief Financial Officer, Treasurer and Corporate Secretary  2017  $250,000  $—    $—    $35,392  $—    $—    $—    $285,392 
   2016  $250,000  $—    $—    $7,875  $—    $—    $—    $257,875 
                                     
Elliot Ehrlich                                    
Chief Executive Officer and Chief Financial Officer, Treasurer and Corporate Secretary  2015  $150,000  $—    $—    $—    $—    $—    $—    $150,000 
   2014  $150,000  $—    $—    $—    $—    $—    $—    $150,000 

 (1) We were incorporated on April 10, 2013.

Employment Agreement

On April 11, 2016, the Company entered into an employment agreement with the Company’s Chief Executive Officer paying $250,000 in annual salary. The agreement was effective beginning April 11, 2016 and expires on April 10, 2019.

Option/SAR Grants

In connection with the employment agreement signed with the Chief Financial Officer on April 11, 2016, Jonathan Adams received options to acquire 3 million shares exercisable at $0.06 per share, the closing price on that date. These Options Group A shall become vested and exercisable (i) as to 1 million shares on April 11, 2017, (ii) as to 1 million shares on April 11, 2018, and (iii) as to 1 million shares on April 11, 2019.

Between 11/16/2016 and 5/19/2017, the Company issued options to acquire 1 million shares exercisable at an average price of $0.24 per share to consultants and board of directors for services provided to the company.

Long-Term Incentive Plans and Awards

Other than the options granted to the Chief Executive Officer as described above, the Company does not have any long-term incentive plans that provide compensation intended to serve as incentive for performance. Since prior to this grant, no individual grants or agreements regarding future payouts under non-stock price-based plans had been made to any executive officer or any Director or any employee or consultant since our inception, no future payouts under non-stock price-based plans or agreements had been granted or entered into or exercised by our officer or Director or employees or consultants.

Compensation of Directors

There are no arrangements pursuant to which our Director is or will be compensated in the future for any services provided as a Director, except that the Company’s Directors receive stock options.

 -50-

ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Long-Term Incentive Plans and Awards

Other than the options granted to the Chief Executive Officer on April 11, 2016 as described previously, the Company does not have any long-term incentive plans that provide compensation intended to serve as incentive for performance. Since prior to this grant, no individual grants or agreements regarding future payouts under non-stock price-based plans had been made to any executive officer or any Director or any employee or consultant since our inception, no future payouts under non-stock price-based plans or agreements had been granted or entered into or exercised by our officer or Director or employees or consultants.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information concerning the ownership of the Common Stock by (a) each person who, to the best of our knowledge, beneficially owned on that date more than 5% of our outstanding Common Stock, (b) each of our Directors and executive officers and (c) all current Directors and executive officers as a group. The following table is based upon an aggregate of 91,925,000 shares of our Common Stock outstanding as of the date of this prospectus.

Name and Address of Beneficial Owner Number of Shares of Common Stock Beneficially Owned or Right to Direct Vote (1) Percent of Common Stock Beneficially Owned or Right to Direct Vote (1)
Jonathan Adams  6,168,066   6.7%
Amrit Shahzad  1,298,512   1.4%
Cuong Do  2,671,354   2.9%
Jim Lang  250,000   0.27%
Julie Anderson  100,000   0.11%
Hari Kumar  120,000   0.13%
         
All Directors and executive officers as a group (Six persons):  10, 607,933   11.5%
         
Other 5% or Greater Beneficial Owners:        
Elliot Ehrlich
9511 Collins Ave #807 Surfside, FL 33154
  7,525,000   8.2%
Leo and Helene Ehrlich
7846 Tennyson Ct. Boca Raton, FL 33433
  8,500,000   9.25%
Rebecca Guttman
655 Ibsen St., Woodmere, NY 11598
  8,500,000   9.25%
RGN Brothers Trust  8,500,000   9.25%

(1)Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. In accordance with SEC rules, shares of Common Stock issuable upon the exercise of options or warrants which are currently exercisable or which become exercisable within 60 days following the date of the information in this table are deemed to be beneficially owned by, and outstanding with respect to, the holder of such option or warrant, however none of the persons listed hereinabove has the right to acquire beneficial ownership in any other shares of the Company. Subject to community property laws where applicable, to our knowledge, each person listed is believed to have sole voting and investment power with respect to all shares of Common Stock owned by such person.


 -51-

ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

None

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table shows what Weinberg & Baer LLC billed for the audit and other services for the years ended June 30, 2017 and 2016.

  

Year

Ended

June 30, 2017

 

Year

Ended

June 30, 2016

Audit Fees $16,000  $12,000 
Audit-Related Fees  —     —   
Tax Fees  —     —   
All Other Fees  —     —   
         
Total $16,000  $12,000 

Audit Fees—This category includes the audit of the Company’s annual financial statements, review of financial statements included in the Company’s Form 10-Q Quarterly Reports and services that are normally provided by the independent auditors in connection with engagements for those years.

Audit-Related Fees—N/A

Tax Fees—N/A

Overview —The Company’s Board reviews, and in its sole discretion pre-approves, our independent auditors’ annual engagement letter including proposed fees and all audit and non-audit services provided by the independent auditors. Accordingly, all services described under “Audit Fees,” “Audit-Related Fees,” and “Tax Fees” were pre-approved by our Company’s Board. The Board may not engage the independent auditors to perform the non-audit services proscribed by law or regulation.

 -52-

9.ITEM 15.Income TaxesEXHIBITS AND FINANCIAL STATEMENT SCHEDULES

Significant components of the Company’s deferred tax assets are as follows:

       
  June 30, 2021  June 30, 2020 
Deferred tax assets:        
Tax loss carryforward $1,454,837  $2,100,816 
Intangible assets  (327,001)  (371,063)
Stock based compensation  901,111   7,453 
Valuation Allowance  (2,028,947)  (1,737,206)
Net deferred tax assets $  $ 

At June 30, 2021 and 2020, the Company has recorded a full valuation against its net deferred tax assets of $2,028,947 and $1,737,206, respectively, since in the judgement of management, these assets are not more than likely than not to be realized. The change in the valuation allowance during the year ended June 30, 2021 was $291,741.

At June 30, 2021, the Company had a Net Operating Loss (“NOL”) carryforward of approximately $18,190,000. NOL’s generated prior to 2018 will expire during the years ranging from 2032 to 2037.

The Company has no current tax expense due to its losses.

Reconciliation of the differences between income tax benefit computed at the federal and state statutory tax rates and the provision for income tax benefit for the years ended June 30, 2021 and 20120 is as follows:

  2021  2020 
       
Income tax expense at federal statutory rate  21%  21%
State taxes, net of federal benefit  9%  7%
Change in valuation allowance  -30%  -28%
Effective tax rate  0   0 

Regulation

Number

10.
Exhibit
14.1Code of Ethics
31.1Rule 13a-14(a) Certification
32.1Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INSXBRL Instance Document
101.SCHXBRL Taxonomy Extension Schema Document.
101.CALXBRL Taxonomy Calculation Linkbase Document.
101.LABXBRL Taxonomy Label Linkbase Document
101.PREXBRL Taxonomy Presentation Linkbase Document
101.DEFXBRL Taxonomy Extension Definition Linkbase Document.Subsequent Events

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SIGNATURES

Pursuantits Class A common stock at $8.00 per share, resulting in net proceeds to the requirementsCompany of Section 13 or 15(d)approximately $17.8 million, net of the Securities Exchange Actissuance cost of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.approximately $2.2 million.

BIOVIE (F/K/A NANOANTIBIOTICS, INC.)

SignatureTitlesDate
/s/Jonathan Adams
Jonathan AdamsChief Executive Officer and Chief Financial OfficerAugust 23, 2017
/s/ Amrit Shahzad
Amrit ShahzadPresident and SecretaryAugust 23, 2017

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