☒ | QUARTERLY 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 |
84-462-0206
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company |
☐
2 | ||||||
ITEM 1. | Financial Statements (unaudited) | 4 | ||||
Consolidated Balance Sheets as of December 31, | ||||||
ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||
ITEM 3. | Quantitative and Qualitative Disclosures About Market Risk | |||||
ITEM 4. | Controls and Procedures | 41 | ||||
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ITEM 1. | Legal Proceedings | |||||
ITEM 1A. | Risk Factors | |||||
ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds | |||||
ITEM 3. | Defaults Upon Senior Securities | 42 | ||||
ITEM 4. | Mine Safety Disclosures | 42 | ||||
ITEM 5. | Other Information | 42 | ||||
ITEM 6. | Exhibits | 43 | ||||
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including the potential duration of treatment effects and the potential for a “one shot” cure;
ITEM 1. | ||||
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1
December 31, | June 30, | |||||||
2020 | 2020 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 14,010 | $ | 9,801 | ||||
Trade and other receivables | 21 | 59 | ||||||
Other current assets | 352 | 949 | ||||||
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Total current assets | 14,383 | 10,809 | ||||||
Property and equipment, net | 610 | 374 | ||||||
Deposits | 9 | 9 | ||||||
Other assets | 210 | — | ||||||
Right-of-use assets | 300 | 395 | ||||||
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Total assets | $ | 15,512 | $ | 11,587 | ||||
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Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Trade and other payables | $ | 355 | $ | 741 | ||||
Accrued employee benefits | 221 | 203 | ||||||
Lease liabilities, current portion | 203 | 192 | ||||||
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Total current liabilities | 779 | 1,136 | ||||||
Lease liabilities, less current portion | 108 | 213 | ||||||
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Total liabilities | 887 | 1,349 | ||||||
Commitments and contingencies (Note 13) | ||||||||
Stockholders’ equity: | ||||||||
Common stock, $0.0001 par value—10,000,000 shares authorized; 4,540,469 and 1,108,374 shares issued and outstanding at December 31, 2020 and June 30, 2020, respectively | 4 | 1 | ||||||
Additional paid-in capital | 138,395 | 128,826 | ||||||
Accumulated deficit | (122,207 | ) | (116,636 | ) | ||||
Accumulated other comprehensive loss | (1,567 | ) | (1,953 | ) | ||||
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Total stockholders’ equity | 14,625 | 10,238 | ||||||
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Total liabilities and stockholders’ equity | $ | 15,512 | $ | 11,587 | ||||
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December 31, | June 30, | |||||||
2021 | 2021 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 12,329 | $ | 19,769 | ||||
Trade and other receivables | 5 | 25 | ||||||
Prepaid and other assets | 338 | 814 | ||||||
Total current assets | 12,672 | 20,608 | ||||||
Property and equipment, net | 268 | 375 | ||||||
Deposits | 25 | 9 | ||||||
Other assets | 161 | 185 | ||||||
Right-of-use | 888 | 202 | ||||||
Total assets | $ | 14,014 | $ | 21,379 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Trade and other payables | $ | 1,946 | $ | 880 | ||||
Accrued employee benefits | 321 | 276 | ||||||
Lease liabilities, current portion | 213 | 213 | ||||||
Total current liabilities | 2,480 | 1,369 | ||||||
Lease liabilities, less current portion | 698 | 0 | ||||||
Total liabilities | 3,178 | 1,369 | ||||||
Commitments and contingencies (Note 1 0 ) | 0 | 0 | ||||||
Stockholders’ equity: | ||||||||
Common stock, $0.0001 par value-40,000,000 shares authorized; 8,171,690 shares issued and outstanding at December 31, 2021 and June 30, 2021 | 1 | 1 | ||||||
Additional paid-in capital | 152,093 | 151,583 | ||||||
Accumulated deficit | (139,985 | ) | (130,119 | ) | ||||
Accumulated other comprehensive loss | (1,273 | ) | (1,455 | ) | ||||
Total stockholders’ equity | 10,836 | 20,010 | ||||||
Total liabilities and stockholders’ equity | $ | 14,014 | $ | 21,379 | ||||
2
Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenue: | ||||||||||||||||
Revenues from customers | $ | 1 | $ | 77 | $ | 56 | $ | 110 | ||||||||
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Total revenues | 1 | 77 | 56 | 110 | ||||||||||||
Operating expenses | ||||||||||||||||
Royalties and license fees | (19 | ) | (306 | ) | 114 | (280 | ) | |||||||||
Research and development | 1,168 | 599 | 1,942 | 1,022 | ||||||||||||
General and administrative | 2,111 | 1,895 | 3,948 | 2,645 | ||||||||||||
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Total operating expenses | 3,260 | 2,188 | 6,004 | 3,387 | ||||||||||||
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Loss from operations | (3,259 | ) | (2,111 | ) | (5,948 | ) | (3,277 | ) | ||||||||
Other income (loss): | ||||||||||||||||
Foreign currency transaction gain (loss) | — | 5 | (54 | ) | 5 | |||||||||||
Interest income (expense), net | (2 | ) | 17 | (3 | ) | 35 | ||||||||||
Other income, net | 10 | — | 36 | — | ||||||||||||
Unrealized loss on investment | (1 | ) | (1 | ) | (1 | ) | — | |||||||||
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Total other income (loss), net | 7 | 21 | (22 | ) | 40 | |||||||||||
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Net loss | $ | (3,252 | ) | $ | (2,090 | ) | $ | (5,970 | ) | $ | (3,237 | ) | ||||
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Other comprehensive income: | ||||||||||||||||
Unrealized foreign currency translation gain | 208 | 336 | 386 | 32 | ||||||||||||
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Total other comprehensive income | 208 | 336 | 386 | 32 | ||||||||||||
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Total comprehensive loss | $ | (3,044 | ) | $ | (1,754 | ) | $ | (5,584 | ) | $ | (3,205 | ) | ||||
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Net loss | $ | (3,252 | ) | $ | (2,090 | ) | $ | (5,970 | ) | $ | (3,237 | ) | ||||
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Net loss per share: | ||||||||||||||||
Basic and diluted | $ | (0.76 | ) | $ | (2.00 | ) | $ | (2.21 | ) | $ | (3.40 | ) | ||||
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Weighted average number of shares outstanding: basic and diluted | 4,300,073 | 1,043,431 | 2,704,223 | 951,112 | ||||||||||||
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Three Months Ended | Six Months Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue: | ||||||||||||||||
Licensing revenues from customers | $ | 25 | $ | 1 | $ | 25 | $ | 56 | ||||||||
Total revenues | 25 | 1 | 25 | 56 | ||||||||||||
Operating expenses | ||||||||||||||||
Royalties and license fees | 0 | (19 | ) | 0 | 114 | |||||||||||
Research and development | 3,146 | 1,168 | 5,926 | 1,942 | ||||||||||||
General and administrative | 1,714 | 2,111 | 3,756 | 3,948 | ||||||||||||
Total operating expenses | 4,860 | 3,260 | 9,682 | 6,004 | ||||||||||||
Loss from operations | (4,835 | ) | (3,259 | ) | (9,657) | (5,948 | ) | |||||||||
Other income (loss): | ||||||||||||||||
Foreign currency transaction gain (loss) | 48 | 0 | (193 | ) | (54 | ) | ||||||||||
Interest expense, net | (11 | ) | (2 | ) | (12) | (3 | ) | |||||||||
Other income, net | 0 | 10 | 0 | 36 | ||||||||||||
Unrealized loss on investment | (23 | ) | (1 | ) | (5) | (1 | ) | |||||||||
Total other income (loss), net | 14 | 7 | (210 | ) | (22 | ) | ||||||||||
Net loss | $ | (4,821 | ) | $ | (3,252 | ) | $ | (9,867 | ) | $ | (5,970 | ) | ||||
Other comprehensive income: | ||||||||||||||||
Unrealized foreign currency translation (loss) gain | (57 | ) | 208 | 182 | 386 | |||||||||||
Total other comprehensive (loss) income | (57 | ) | 208 | 182 | 386 | |||||||||||
Total comprehensive loss | $ | (4,878 | ) | $ | (3,044 | ) | $ | (9,685 | ) | $ | (5,584 | ) | ||||
Net loss | $ | (4,821 | ) | $ | (3,252 | ) | $ | (9,867 | ) | $ | (5,970 | ) | ||||
Net loss per share: | ||||||||||||||||
Basic and diluted | $ | (0.59 | ) | $ | (0.76 | ) | $ | (1.21 | ) | $ | (2.21 | ) | ||||
Weighted average number of shares outstanding: basic and diluted | 8,171,690 | 4,300,073 | 8,171,690 | 2,704,223 | ||||||||||||
3
Common Stock | Additional | Accumulated | Accumulated | Total | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance at June 30, 2019 | 856,765 | $ | 1 | $ | 127,327 | $ | (108,870 | ) | $ | (1,864 | ) | $ | 16,594 | |||||||||||
Common stock sold for cash, net of issuance costs of $240 | 186,666 | — | 1,720 | — | — | 1,720 | ||||||||||||||||||
Issuance of pre-purchased warrants, net of issuance costs of $240 | — | — | 50 | — | — | 50 | ||||||||||||||||||
Share-based compensation | — | — | 55 | — | — | 55 | ||||||||||||||||||
Forfeiture of share-based payments | — | — | (61 | ) | 61 | — | — | |||||||||||||||||
Foreign currency translation loss | — | — | — | — | (304 | ) | (304 | ) | ||||||||||||||||
Net loss | — | — | — | (1,147 | ) | (1,147 | ) | |||||||||||||||||
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Balance at September 30, 2019 | 1,043,431 | $ | 1 | $ | 129,091 | $ | (109,956 | ) | $ | (2,168 | ) | $ | 16,968 | |||||||||||
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Share-based compensation | — | — | 37 | 37 | ||||||||||||||||||||
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Forfeiture of share-based payments | — | — | (319 | ) | 319 | — | — | |||||||||||||||||
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Foreign currency translation gain | — | — | — | — | 336 | 336 | ||||||||||||||||||
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Net loss | — | — | — | (2,090 | ) | — | (2,090 | ) | ||||||||||||||||
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Balance at December 31, 2019 | 1,043,431 | $ | 1 | $ | 128,809 | $ | (111,727 | ) | $ | (1,832 | ) | $ | 15,251 | |||||||||||
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Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance at June 30, 2020 | 1,108,374 | $ | 1 | $ | 128,826 | $ | (116,636 | ) | $ | (1,953 | ) | $ | 10,238 | |||||||||||
Share-based compensation | — | — | 38 | — | — | 38 | ||||||||||||||||||
Forfeiture of share-based payments | — | — | (14 | ) | 14 | — | — | |||||||||||||||||
Foreign currency translation gain | — | — | — | — | 178 | 178 | ||||||||||||||||||
Net loss | — | — | — | (2,718 | ) | (2,718 | ) | |||||||||||||||||
Balance at September 30, 2020 | 1,108,374 | 1 | 128,850 | (119,340 | ) | (1,775 | ) | 7,736 | ||||||||||||||||
Issuance of common stock and pre-funded warrants sold for cash, net of issuance costs of $1,643 | 3,150,514 | 3 | 9,848 | — | — | 9,851 | ||||||||||||||||||
Exercise of pre-funded warrants | 281,581 | — | — | — | — | — | ||||||||||||||||||
Share-based compensation | — | — | 82 | — | — | 82 | ||||||||||||||||||
Forfeiture of share-based payments | — | — | (385 | ) | 385 | — | — | |||||||||||||||||
Foreign currency translation gain | — | — | — | — | 208 | 208 | ||||||||||||||||||
Net loss | — | — | — | (3,252 | ) | — | (3,252 | ) | ||||||||||||||||
Balance at December 31, 2020 | 4,540,469 | $ | 4 | $ | 138,395 | $ | (122,207 | ) | $ | (1,567 | ) | $ | 14,625 | |||||||||||
4
Common Stock | Additional | Accumulated | Accumulated | Total | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance at June 30, 2020 | 1,108,374 | $ | 1 | $ | 128,826 | $ | (116,636 | ) | $ | (1,953 | ) | $ | 10,238 | |||||||||||
Share-based compensation | — | — | 38 | — | — | 38 | ||||||||||||||||||
Forfeiture of share-based payments | — | — | (14 | ) | 14 | — | — | |||||||||||||||||
Foreign currency translation gain | — | — | — | — | 178 | 178 | ||||||||||||||||||
Net loss | — | — | — | (2,718 | ) | (2,718 | ) | |||||||||||||||||
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Balance at September 30, 2020 | 1,108,374 | $ | 1 | $ | 128,850 | $ | (119,340 | ) | $ | (1,775 | ) | $ | 7,736 | |||||||||||
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Issuance of common stock and pre-funded warrants sold for cash, net of issuance costs of $1,643 | 3,150,514 | 3 | 9,848 | — | — | 9,851 | ||||||||||||||||||
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Exercise of pre-funded warrants | 281,581 | — | — | — | — | — | ||||||||||||||||||
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Share-based compensation | — | — | 82 | — | — | 82 | ||||||||||||||||||
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Forfeiture of share-based payments | — | — | (385 | ) | 385 | — | — | |||||||||||||||||
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Foreign currency translation gain | — | — | — | — | 208 | 208 | ||||||||||||||||||
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Net loss | — | — | — | (3,252 | ) | — | (3,252 | ) | ||||||||||||||||
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Balance at December 31, 2020 | 4,540,469 | $ | 4 | $ | 138,395 | $ | (122,207 | ) | $ | (1,567 | ) | $ | 14,625 | |||||||||||
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Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance at June 30, 2021 | 8,171,690 | $ | 1 | $ | 151,583 | $ | (130,119 | ) | $ | (1,455 | ) | $ | 20,010 | |||||||||||
Share-based compensation | — | — | 271 | — | — | 271 | ||||||||||||||||||
Foreign currency translation gain | — | — | — | — | 239 | 239 | ||||||||||||||||||
Net loss | — | — | — | (5,045 | ) | — | (5,045 | ) | ||||||||||||||||
Balance at September 30, 2021 | 8,171,690 | 1 | 151,854 | (135,164 | ) | (1,216 | ) | 15,475 | ||||||||||||||||
Share-based compensation | — | — | 239 | — | — | 239 | ||||||||||||||||||
Foreign currency translation loss | — | — | — | — | (57 | ) | (57 | ) | ||||||||||||||||
Net loss | — | — | — | (4,821 | ) | — | (4,821 | ) | ||||||||||||||||
Balance at December 31, 2021 | 8,171,690 | $ | 1 | $ | 152,093 | $ | (139,985 | ) | $ | (1,273 | ) | $ | 10,836 | |||||||||||
5
Six Months Ended | ||||||||
December 31, | ||||||||
2020 | 2019 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (5,970 | ) | $ | (3,237 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 112 | 102 | ||||||
Amortization of right-of-use assets | 95 | 91 | ||||||
Loss on disposal of fixed assets | — | 1 | ||||||
Unrealized (gain) loss on investment | (1 | ) | 1 | |||||
Share-based compensation expense | 120 | 92 | ||||||
Changes in operating assets and liabilities: | ||||||||
Trade and other receivables | 28 | 1,566 | ||||||
Other assets | 424 | (150 | ) | |||||
Trade and other payables | (425 | ) | (2,028 | ) | ||||
Accrued employee benefits | 25 | 11 | ||||||
Lease liabilities | (94 | ) | (70 | ) | ||||
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Net cash used in operating activities | (5,686 | ) | (3,621 | ) | ||||
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Cash flows from investing activities: | ||||||||
Purchases of property and equipment | (347 | ) | (82 | ) | ||||
Proceeds from disposal of property and equipment | — | 1 | ||||||
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Net cash used in investing activities | (347 | ) | (81 | ) | ||||
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Cash flows from financing activities: | ||||||||
Proceeds from issues of shares and pre-funded warrants | 11,494 | 2,250 | ||||||
Shares and pre-funded warrant issuance costs | (1,643 | ) | (480 | ) | ||||
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Net cash provided by financing activities | 9,851 | 1,770 | ||||||
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Effects of exchange rate changes on cash and cash equivalents | 391 | — | ||||||
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Net increase (decrease) in cash and cash equivalents | 4,209 | (1,932 | ) | |||||
Cash and cash equivalents, beginning of period | 9,801 | 15,718 | ||||||
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Cash and cash equivalents, end of period | $ | 14,010 | $ | 13,786 | ||||
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Supplemental disclosure of cash flow information: | ||||||||
Initial measurement of operating lease right-of-use assets and liabilities | $ | — | $ | (579 | ) | |||
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Six Months Ended | ||||||||
December 31, | ||||||||
2021 | 2020 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (9,867 | ) | $ | (5,970 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 107 | 112 | ||||||
Amortization of right-of-use | 108 | 95 | ||||||
Unrealized loss on investment | 5 | 1 | ||||||
Share-based compensation expense | 510 | 120 | ||||||
Changes in operating assets and liabilities: | ||||||||
Trade and other receivables | 0 | 28 | ||||||
Other assets | 470 | 424 | ||||||
Trade and other payables | 1,146 | (427 | ) | |||||
Accrued employee benefits | (5 | ) | 25 | |||||
Lease liabilities | (96 | ) | (94 | ) | ||||
Net cash used in operating activities | (7,622 | ) | (5,686 | ) | ||||
Cash flows from investing activities: | ||||||||
Purchases of property and equipment | 0 | (347 | ) | |||||
Net cash used in investing activities | 0 | (347 | ) | |||||
Cash flows from financing activities: | ||||||||
Proceeds from issues of shares and pre-funded warrants | 0 | 11,494 | ||||||
Shares and pre-funded warrant issuance costs | 0 | (1,643 | ) | |||||
Net cash provided by financing activities | 0 | 9,851 | ||||||
Effects of exchange rate changes on cash and cash equivalents | 182 | 391 | ||||||
Net increase (decrease) in cash and cash equivalents | (7,440 | ) | 4,209 | |||||
Cash and cash equivalents, beginning of period | 19,769 | 9,801 | ||||||
Cash and cash equivalents, end of period | $ | 12,329 | $ | 14,010 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Re-measurement of operating leaseright-of-use | $ | 794 | $ | 0 | ||||
6
On November 27, 2019, BBL announced
In accordance with the U.S. Securities and Exchange Commission’s (“SEC”) Staff Accounting Bulletin Topic 4C, all issued and outstanding shares of the Company’s common stock have been retroactively adjusted in these consolidated financial statements to reflect the 300:1 ratio and share consolidation as if it occurred on July 1, 2019.
The terms the “Company,” “we,” “us,” “our” and similar terms used herein refer (i), prior to the re-domiciliation to BBL, an Australian corporation, and its subsidiaries, and (ii), following the re-domiciliation, to Benitec Biopharma Inc., a Delaware corporation, and its subsidiaries (including BBL).
US.
Principal place of | Ownership Fiscal Year 2020 | Ownership Fiscal Year 2019 | ||||||||
Benitec Biopharma Proprietary Limited (“BBL”) | Australia | 100 | % | — | ||||||
Benitec Australia Proprietary Limited | Australia | 100 | % | 100 | % | |||||
Benitec Limited | United Kingdom | 100 | % | 100 | % | |||||
Benitec, Inc. | USA | 100 | % | 100 | % | |||||
Benitec LLC | USA | 100 | % | 100 | % | |||||
RNAi Therapeutics, Inc. | USA | 100 | % | 100 | % | |||||
Tacere Therapeutics, Inc. | USA | 100 | % | 100 | % |
The Company is continuing to monitor the impact of the pandemic of the novel strain of coronavirus COVID-19 (“COVID-19”) on all aspects of its business, including how it will impact our employees, suppliers, vendors and business partners. While the Company did experience some disruption from COVID-19 including disruption of the timing and completion of certain pre-clinical trials we are unable to predict the overall impact that COVID-19 will have on our financial position and operating results due to numerous uncertainties.
7
Principal place of business/country of incorporation | ||
Benitec Biopharma Proprietary Limited (“BBL”) | Australia | |
Benitec Australia Proprietary Limited | Australia | |
Benitec Limited | United Kingdom | |
Benitec, Inc. | USA | |
Benitec LLC | USA | |
RNAi Therapeutics, Inc. | USA | |
Tacere Therapeutics, Inc. | USA | |
Benitec IP Holdings, Inc. | USA |
2021.
8
gains.
Level 1: | Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. | |||
Level 2: | Inputs, other than quoted prices that are observable, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. | |||
Level 3: | Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use. |
The carrying amounts of the Company’s cash and cash equivalents, accounts receivables, and accounts payables are considered to be representative of their respective fair values because of the short-term nature of those instruments. As of December 31, 2020, and June 30, 2020, the Company had no financial assets or liabilities measured at fair value on a recurring basis.
9
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
There were no cash equivalents as of December 31, 2021 and June 30, 2021.
Software | 3-4 years | |||
Lab equipment | 3-7 years | |||
Computer hardware | 3-5 years | |||
Leasehold improvements | shorter of the lease term or estimated useful lives |
10
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
11
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Upon adoption of ASC 606, the Company recognizes revenue in accordance with that core principle by applying the following steps:
12
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Government Research and Development Grants
Government grants are recognized at fair value where there is reasonable assurance that the grant will be received, and all grant conditions will be met. Grants relating to expense items are recognized as income over the periods necessary to match the grant costs they are compensating.
Grant income is generated through the Australian federal government’s Research and Development Tax Incentive program, under which the government provides a cash refund for 43.5% (2019: 43.5%) of eligible research and development expenditures. This grant is available for our research and development activities in Australia, as well as activities in the United States to the extent such U.S.-based expenses relate to our activities in Australia, do not exceed half the expenses for the relevant activities and are approved by the Australian government. Grants are recorded when a reliable estimate can be made.
The Company will not be claiming the Australian Government research and development grants going forward.
Equity-based
The Company adopted FASB Accounting Standard Update (“ASU”) 2018-07 and accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ASC 718 and recognizes the fair value of such awards over the service period.
13
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Report.
14
(US$’000) | December 31, 2021 | June 30, 2021 | ||||||
Prepaid expenses | $ | 472 | $ | 967 | ||||
Security deposit | 15 | 15 | ||||||
Market value of listed shares | 12 | 17 | ||||||
Total other assets | 499 | 999 | ||||||
Less: non-current portion | (161 | ) | (185 | ) | ||||
Current portion | $ | 338 | $ | 814 | ||||
4. Revenue (US$’000)
Three Months Ended | Six Months Ended | |||||||||||||||
Revenues from customers | December 31, 2020 | December 31, 2019 | December 31, 2020 | December 31, 2019 | ||||||||||||
Licensing revenue | $ | 1 | $ | 61 | $ | 56 | $ | 61 | ||||||||
Royalty revenue | — | 16 | — | 45 | ||||||||||||
Service revenue* | — | — | — | 4 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 1 | $ | 77 | $ | 56 | $ | 110 | ||||||||
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|
|
|
|
|
|
|
|
Three Months Ended December 31, 2020 | ||||||||||||||||
Disaggregated revenue (US$’000) | Licensing | Royalties | Development activities | Total | ||||||||||||
Services transferred at a point in time | $ | — | $ | — | $ | — | $ | — | ||||||||
Services transferred over time | 1 | — | — | 1 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 1 | $ | — | $ | — | $ | 1 | ||||||||
|
|
|
|
|
|
|
|
Six Months Ended December 31, 2020 | ||||||||||||||||
Disaggregated revenue (US$’000) | Licensing | Royalties | Development activities | Total | ||||||||||||
Services transferred at a point in time | $ | — | $ | — | $ | — | $ | — | ||||||||
Services transferred over time | 56 | — | — | 56 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 56 | $ | — | $ | — | $ | 56 | ||||||||
|
|
|
|
|
|
|
|
15
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Three Months Ended December 31, 2019 | ||||||||||||||||
Disaggregated revenue (US$’000) | Licensing | Royalties | Development activities | Total | ||||||||||||
Services transferred at a point in time | $ | — | $ | — | $ | — | $ | — | ||||||||
Services transferred over time | 61 | 16 | — | 77 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 61 | $ | 16 | $ | — | $ | 77 | ||||||||
|
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|
|
| |||||||||
Six Months Ended December 31, 2019 | ||||||||||||||||
Disaggregated revenue (US$’000) | Licensing | Royalties | Development activities | Total | ||||||||||||
Services transferred at a point in time | $ | — | $ | — | $ | 4 | $ | 4 | ||||||||
Services transferred over time | 61 | 45 | — | 106 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 61 | $ | 45 | $ | 4 | $ | 110 | ||||||||
|
|
|
|
|
|
|
|
(US$’000) | December 31, 2020 | June 30, 2020 | ||||||
Cash at Bank | $ | 14,010 | $ | 5,231 | ||||
Term Deposit | — | 4,570 | ||||||
|
|
|
| |||||
Total | $ | 14,010 | $ | 9,801 | ||||
|
|
|
|
6. Trade and other receivables
(US$’000) | December 31, 2020 | June 30, 2020 | ||||||
Other receivables | $ | 21 | $ | 59 | ||||
|
|
|
| |||||
Total | $ | 21 | $ | 59 | ||||
|
|
|
|
16
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
7. Other assets
(US$’000) | December 31, 2020 | June 30, 2020 | ||||||
Prepaid expenses | $ | 538 | $ | 861 | ||||
Security deposit | 16 | 69 | ||||||
Other deposit | 7 | 18 | ||||||
Market value of listed shares | 1 | 1 | ||||||
|
|
|
| |||||
Total other assets | 562 | 949 | ||||||
Less: non-current portion | (210 | ) | — | |||||
|
|
|
| |||||
Current portion | $ | 352 | $ | 949 | ||||
|
|
|
|
8. Property and equipment, net
(US$’000) | December 31, 2020 | June 30, 2020 | ||||||
Software | $ | 11 | $ | 11 | ||||
Lab equipment | 1,457 | 1,109 | ||||||
Computer hardware | 26 | 26 | ||||||
Leasehold improvements | 24 | 24 | ||||||
|
|
|
| |||||
Total property and equipment, gross | 1,518 | 1,170 | ||||||
Accumulated depreciation and amortization | (908 | ) | (796 | ) | ||||
|
|
|
| |||||
Total property and equipment, net | $ | 610 | $ | 374 | ||||
|
|
|
|
(US$’000) | December 31, 2021 | June 30, 2021 | ||||||
Software | $ | 14 | $ | 14 | ||||
Lab equipment | 1,328 | 1,329 | ||||||
Computer hardware | 26 | 26 | ||||||
Leasehold improvements | 24 | 24 | ||||||
Total property and equipment, gross | 1,392 | 1,393 | ||||||
Accumulated depreciation and amortization | (1,124 | ) | (1,018 | ) | ||||
Total property and equipment, net | $ | 268 | $ | 375 | ||||
9.2020.
(US$’000) | December 31, 2020 | June 30, 2020 | ||||||
Trade payable | $ | 87 | $ | 282 | ||||
Accrued license fees | 142 | 54 | ||||||
Accrued professional fees | 35 | 155 | ||||||
Other payables | 91 | 250 | ||||||
|
|
|
| |||||
Total | $ | 355 | $ | 741 | ||||
|
|
|
|
17
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
10.
(US$’000) | December 31, 2021 | June 30, 2021 | ||||||
Trade payable | $ | 682 | $ | 274 | ||||
Accrued license fees | 136 | 140 | ||||||
Accrued professional fees | 55 | 13 | ||||||
Accrued research and development | 738 | 279 | ||||||
Accrued bonuses | 112 | 0 | ||||||
Other payables | 223 | 174 | ||||||
Total | $ | 1,946 | $ | 880 | ||||
During August 2021, the Company extended the lease through June 2025.
(US$’000) | Operating lease right-of- use assets | |||
Balance at July 1, 2021 | $ | 202 | ||
Re-measurement during the period | 794 | |||
Amortization of right of use asset | (108 | ) | ||
Operating lease right-of-use | $ | 888 | ||
(US$’000) | Operating lease liabilities | |||
Balance at July 1, 2021 | $ | 213 | ||
Re-measurement during the period | 794 | |||
Principal payments on operating lease liabilities | (96 | ) | ||
Operating lease liabilities at December 31, 2021 | 911 | |||
Less: non-current portion | (698 | ) | ||
Current portion at December 31, 2021 | $ | 213 | ||
(US$’000) | December 31, 2020 | |||
2021 | $ | 105 | ||
2022 | 218 | |||
|
| |||
Total operating lease payments | 323 | |||
Less imputed interest | (12 | ) | ||
|
| |||
Present value of operating lease liabilities | $ | 311 | ||
|
|
(US$’000) | December 31, 2021 | |||
2022 | 251 | |||
2023 | 290 | |||
2024 | 300 | |||
2025 | 152 | |||
Total operating lease payments | 993 | |||
Less imputed interest | (82 | ) | ||
Present value of operating lease liabilities | $ | 911 | ||
11.2020.
The gross and net proceeds were $11.5 million and $9.9 million, respectively.
18
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Common Stock from Warrants | Weighted- average Exercise Price (per share) | |||||||
Outstanding at July 1, 2020 | 145,421 | $ | 29.48 | |||||
Granted | — | — | ||||||
Exercised | — | — | ||||||
Forfeited | (38,326 | ) | 82.50 | |||||
Outstanding and exercisable at September 30, 2020 | 107,095 | $ | 10.50 | |||||
Granted | 559,162 | 3.09 | ||||||
Exercised | (281,581 | ) | 3.10 | |||||
Forfeited | — | — | ||||||
Outstanding and exercisable at December 31, 2020 | 384,676 | $ | 5.15 | |||||
|
|
|
|
Common Stock from Warrants | Weighted- average Exercise Price (per share) | |||||||
Outstanding at July 1, 2021 | 107,095 | $ | 10.50 | |||||
Outstanding and exercisable at December 31, 2021 | 107,095 | $ | 10.50 |
Upon
19
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
Stock Options | Weighted- average Exercise Price | Weighted-average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||||
Outstanding at June 30, 2020 | 70,161 | $ | 60.42 | 2.89 years | $ | — | ||||||||||
Granted | — | — | ||||||||||||||
Exercised | — | — | ||||||||||||||
Forfeited | (444 | ) | 69.32 | |||||||||||||
|
|
|
| |||||||||||||
Outstanding at September 30, 2020 | 69,717 | $ | 60.00 | 2.65 years | — | |||||||||||
Exercisable at September 30, 2020 | 43,273 | $ | 68.53 | 2.26 years | $ | — | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Granted | 525,546 | 2.98 | 9.95 years | |||||||||||||
Exercised | — | — | ||||||||||||||
Forfeited | (7,967 | ) | 153.78 | |||||||||||||
|
|
|
|
|
|
|
| |||||||||
Outstanding at December 31, 2020 | 587,296 | 7.64 | 9.2 years | — | ||||||||||||
Exercisable at December 31, 2020 | 35,473 | $ | 48.18 | 2.4 years | $ | — | ||||||||||
|
|
|
|
|
|
|
|
Stock Options | Weighted- average Exercise Price | Weighted- average Remaining Contractual Term | Aggregate Intrinsic Value | |||||||||||||
Outstanding at July 1, 2021 | 702,064 | $ | 7.16 | 8.07 years | $ | — | ||||||||||
Outstanding at September 30, 2021 | 702,064 | 7.16 | 7.82 years | $ | — | |||||||||||
Granted | 36,000 | 2.99 | 9.93 years | $ | — | |||||||||||
Outstanding at December 31, 2021 | 738,064 | 6.95 | 7.68 years | $ | — | |||||||||||
Exercisable at December 31, 2021 | 229,333 | $ | 13.59 | 7.20 years | $ | — | ||||||||||
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(US$’000) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Research and development | $ | 6 | $ | 17 | $ | 15 | $ | — | ||||||||
General and administrative | 76 | 20 | 105 | 92 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total share-based compensation expense | $ | 82 | $ | 37 | $ | 120 | $ | 92 | ||||||||
|
|
|
|
|
|
|
|
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
(US$’000) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Research and development | $ | 80 | $ | 6 | $ | 161 | $ | 15 | ||||||||
General and administrative | 159 | 76 | 349 | 105 | ||||||||||||
Total share-based compensation expense | $ | 239 | $ | 82 | $ | 510 | $ | 120 | ||||||||
20
BENITEC BIOPHARMA INC.
Notes to Consolidated Financial Statements
(Unaudited)
12.
13.
21
a chronic, life-threatening clinical indication.
Through the combination of the
Unless otherwise indicated, all dollar amounts in this section are provided in thousands.
Re-domiciliation
On April 15, 2020, (the “Implementation Date”), the re-domiciliation of Benitec Limited (the “Re-domiciliation”), a public company incorporated under the laws of the State of Western Australia, or Benitec Limited, was completed in accordance with the Scheme Implementation Agreement, as amended and restated as of January 30, 2020, between Benitec Limited and us. As a result of the Re-domiciliation, the jurisdiction of incorporation was changed from Australia to Delaware, and Benitec Limited became our wholly owned subsidiary.
The Re-domiciliation was effected pursuant to a statutory scheme of arrangement under Australian law, or the Scheme, whereby on the Implementation Date, all of the issued and outstanding ordinary shares of Benitec Limited were exchanged for newly issued shares of our common stock, on the basis of one share of our common stock, par value $0.0001 per share, for every 300 ordinary shares of Benitec Limited issued and outstanding. Holders of Benitec Limited’s American Depository Shares, or ADSs (each of which represented 200 ordinary shares), received two shares of our common stock for every three ADSs held.
In December 2019, an outbreak of a novel strain of coronavirus was identified in Wuhan, China. This virus continues to spread globally,
Certain of our research and development efforts are conducted globally, including the ongoing development of our silence and replace therapeutic for the treatment of Oculopharyngeal Muscular Dystrophy (OPMD), and will be dependent upon our ability to initiate preclinical and clinical studies despite the ongoing
clearer.
Axovant Termination
Benitec’s License and Collaboration Agreement, dated July 9, 2018, with Axovant Sciences GmbH, or Axovant, was terminated as of September 3, 2019. As a result, all rights and licenses which Benitec had granted to Axovant to develop and commercialize BB-301 and related gene therapy
Priorand their development status:
Nonclinical data derived fromUnited States and the European Union and, upon achievement of regulatory approval forvivo evaluations these respective jurisdictions, the Orphan Drug Designations would provide commercial exclusivity independent of BB-301intellectual property protection. While OPMD is a rare medical disorder, we believe the commercial opportunity for a safe and efficacious therapeutic agent in two distinct large animal species suggested this clinical indication exceeds $1 billion over the existence of an opportunity to further improve the biological efficacycourse of the compound via additional optimizationcommercial life of the proprietary delivery method employedproduct.
Completionwith key elements of the experimental work noted above wouldstudy design and execution conducted in close collaboration with a team of leading experts in both medicine and surgery that have delayed the initiation of the BB-301 clinical study beyond the timelines that were initially outlined by Axovant following the execution of the License and Collaboration Agreement between Benitec and Axovant. As such, Axovant elected to terminate the License and Collaboration Agreement between Benitec and Axovant, and all rights and licenses granted to Axovant terminated, including the rights to BB-301, which wasbeen deeply engaged in preclinical development for the treatment of OPMD patients for several decades. The
Nonclinical Programs
Nonclinical research efforts supportinginhibitory activities of siRNA13 and siRNA17; this “codon optimized” transcript drives the expression of a PABPN1 protein (i.e., coPABPN1) which serves to replenish the endogenous form of the PABPN1 protein and to replace the mutant form of PABPN1 that underlies the development and progression of ddRNAi-based therapeutic agentsOPMD in diseased tissues.
Workforce Reduction
On July 31, 2019, Benitec announcedprevious
in OPMD patients during 2022.
In December 2016, we entered into an exclusive sublicense agreement with NantWorks, LLC, pursuant to which we agreed to make certain milestone and royalty payments, as well as periodic payments for so long as the agreement remained in effect. In December of 2018, the Company accrued a milestone payment of USD 300k (AUD 425,411), which was anticipated to be paid to NantWorks, LLC under the sublicense agreement. It was later determined that the milestone was not required to be paid and, therefore, the accrual was reversed in December of 2019. We terminated the exclusive sublicense agreement for convenience, with the termination effective as of June 2020.
gains.
In the past Benitec Limited has generated revenue from its operations through two activities: revenue from customers and revenue from government research and development grants. In the fiscal year ended June 30, 2020 and the six months ended December 31, 2020, the Company generated funds primarily from capital raising activities. For the three-month period ended December 31, 2020, the Company received $1 in revenue relating to licensing fees.
loss. Our licensing fees have been generated through the licensing of our ddRNAi technology to biopharmaceutical companies, and in the fiscal year-ended June 30, 2019, revenue was generated through a License and Collaboration Agreement with Axovant Sciences (the “Axovant Agreement”).
companies. The following table sets forth a summary of our revenues for each of the periods set forth below:
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(US$’000) | ||||||||||||||||
Revenues: | ||||||||||||||||
Revenues from customers | $ | 1 | $ | 77 | $ | 56 | $ | 110 | ||||||||
|
|
|
|
|
|
|
| |||||||||
Total revenues | $ | 1 | $ | 77 | $ | 56 | $ | 110 | ||||||||
|
|
|
|
|
|
|
|
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(US$’000) | ||||||||||||||||
Revenues: | ||||||||||||||||
Licensing revenues from customers | $ | 25 | $ | 1 | $ | 25 | $ | 56 | ||||||||
Total revenues | $ | 25 | $ | 1 | $ | 25 | $ | 56 | ||||||||
On July 9, 2018, the Company entered into the Axovant Agreement. The Axovant Agreement granted Axovant Sciences an exclusive worldwide license to develop, manufacture, and commercialize products containing the Company’s product known as BB-301, which was designed for the potential treatment of Oculopharyngeal Muscular Dystrophy. Service revenue consists of payments for services provided to Axovant Sciences pursuant to the Axovant Agreement. On June 6, 2019, the termination of the Axovant Agreement was announced. The termination of the Axovant Agreement was effective as of September 3, 2019. The termination discharges all future performance obligations under the contract at the termination date.
costs incurred.
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(US$’000) | ||||||||||||||||
Operating Expenses: | ||||||||||||||||
Royalties and license fees | $ | (19 | ) | $ | (306 | ) | $ | 114 | $ | (280 | ) | |||||
Research and development | 1,168 | 599 | 1,942 | 1,022 | ||||||||||||
General and administrative | 2,111 | 1,895 | 3,948 | 2,645 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total operating expenses | $ | 3,260 | $ | 2,188 | $ | 6,004 | $ | 3,387 | ||||||||
|
|
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|
|
|
periods:
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(US$’000) | ||||||||||||||||
Operating Expenses: | ||||||||||||||||
Royalties and license fees | $ | — | $ | (19 | ) | $ | — | $ | 114 | |||||||
Research and development | 3,146 | 1,168 | 5,926 | 1,942 | ||||||||||||
General and administrative | 1,714 | 2,111 | 3,756 | 3,948 | ||||||||||||
Total operating expenses | $ | 4,860 | $ | 3,260 | $ | 9,682 | $ | 6,004 | ||||||||
2020.
the commercial-scale
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(US$’000) | ||||||||||||||||
Other Income (Loss): | ||||||||||||||||
Foreign currency transaction gain (loss) | $ | — | $ | 5 | $ | (54 | ) | $ | 5 | |||||||
Interest income (expense), net | (2 | ) | 17 | (3 | ) | 35 | ||||||||||
Other income, net | 10 | — | 36 | — | ||||||||||||
Unrealized loss on investment | (1 | ) | (1 | ) | (1 | ) | — | |||||||||
|
|
|
|
|
|
|
| |||||||||
Total other income (loss), net | $ | 7 | $ | 21 | $ | (22 | ) | $ | 40 | |||||||
|
|
|
|
|
|
|
|
periods:
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(US$’000) | ||||||||||||||||
Other Income (Loss): | ||||||||||||||||
Foreign currency transaction gain (loss) | $ | 48 | $ | — | $ | (193 | ) | $ | (54 | ) | ||||||
Interest expense, net | (11 | ) | (2 | ) | (12 | ) | (3 | ) | ||||||||
Other income, net | — | 10 | — | 36 | ||||||||||||
Unrealized loss on investment | (23 | ) | (1 | ) | (5 | ) | (1 | ) | ||||||||
Total other income (loss), net | $ | 14 | $ | 7 | $ | (210 | ) | $ | (22 | ) | ||||||
Net Loss
The following tables set forth a summary of our loss for each of the periods set forth below:
Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
(US$’000) | ||||||||||||||||
Net Loss | $ | (3,252 | ) | $ | (2,090 | ) | $ | (5,970 | ) | $ | (3,237 | ) | ||||
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|
As a result of the changes in revenues and expenses noted above, our net loss increased from approximately $2,090 and $3,237 in the three and six months ended December 31, 2019, respectively,2021, compared to $3,252 and $5,970 in the three and six months ended December 31, 2020.
States.
Six Months Ended December 31, | ||||||||
2020 | 2019 | |||||||
(US$’000) | ||||||||
Net cash provided by (used in): | ||||||||
Operating activities | $ | (5,686 | ) | $ | (3,621 | ) | ||
Investing activities | (347 | ) | (81 | ) | ||||
Financing activities | 9,851 | 1,770 | ||||||
Effects of exchange rate changes on cash and cash equivalents | 391 | — | ||||||
|
|
|
| |||||
Net increase (decrease) in cash | $ | 4,209 | $ | (1,932 | ) | |||
|
|
|
|
Six Months Ended December 31, | ||||||||
2021 | 2020 | |||||||
(US$’000) | ||||||||
Net cash provided by (used in): | ||||||||
Operating activities | $ | (7,622 | ) | $ | (5,686 | ) | ||
Investing activities | — | (347 | ) | |||||
Financing activities | — | 9,851 | ||||||
Effects of exchange rate changes on cash and cash equivalents | 182 | 391 | ||||||
Net (decrease) increase in cash | $ | (7,440 | ) | $ | 4,209 | |||
Financing activities
Net cash provided by financing activities was $9,851 and $1,770 for the six months ended December 31, 2020 and 2019, respectively. Cash from financing activities in 2020 were related to the issuance of common stock, including $11,494$11.5 million in gross proceeds from the October 2020 Capital Raise, partially offset by $1,643$1.6 million in share issuance costs for the period ended December 31, 2020. For the same period in 2019, cash from financing activities related to the issuance of common stock of BBL, including gross proceeds of $2,250 from a public offering, partially offset by $480 in share issuance costs.
On July 9, 2018, the Company entered into an Agreement with Axovant Sciences. The Agreement granted Axovant Sciences an exclusive worldwide license to develop, manufacture, and commercialize products containing the Company’s product known as BB-301, which was designed for the potential treatment of Oculopharyngeal Muscular Dystrophy. On June 6, 2019, the termination of the Agreement with Axovant Sciences was announced. The termination of the Agreement was effective as of September 3, 2019. The termination discharges all future performance obligations at termination date under the contract.
2025.
Off-Balance Sheet Arrangements
The Company had no material off-balance sheet arrangements as of December 31, 2020.
Revenue Recognition
The Company adopted
Upon implementation of ASC 606, the Company recognizes revenue in accordance with that core principle by applying the following steps:
Step 1: Identify the contract(s) with a customer.
Step 2: Identify the performance obligations in the contract.
Step 3: Determine the transaction price.
Step 4: Allocate the transaction priceDevelopment Expense
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.
The Company applies judgement in determining whether contracts entered into fall within the scopecost of ASC 606. In doing so, management considers the commercial substance of the transactionconducting clinical and how risks
Management has also made the judgement that the grant of the license and transfer of associated know-how and materialsclinical development costs are accounted for as one performance obligation as they are not considered to be distinct; they are highly interrelated and could not provide benefits to the customer independently from each other. Judgements were made in relation to the transfer of the license and know-how and whether this should be recognized over time or a point in time. The point in time has been determined with regard to the point at which the transfer of know-how has substantially been completed and the customer has control of the asset and the ability to direct the use of and receive substantially all of the remaining benefits.
Licensing revenues
Revenue from licensees of the Company’s intellectual property reflects the transfer of a right to use the intellectual property as it exists at the point in time in which the license is transferred to the customer. Consideration can be variable and is estimated using the most likely amount method. Subsequently, the estimate is constrained until it is highly probable that a significant revenue reversal will not occur when the uncertainty is resolved. Revenue is recognized as or when the performance obligations are satisfied.
The Company recognizes contract liabilities for consideration received in respect of unsatisfied performance obligations and reports these amounts as other liabilities in the consolidated balance sheet. Similarly, if the Company satisfies a performance obligation before it receives the consideration, the Company recognizes either a contract asset or a receivable in its consolidated balance sheet, depending on whether something other than the passage of time is required before the consideration is due.
Royalties
Revenue from licensees of the Company’s intellectual property reflect a right to use the intellectual property as it exists at the point in time in which the license is granted. Where consideration is based on sales of product by the licensee, revenue is recognized when the customer’s subsequent sales of product occurs.
Services revenue
Revenue is earned (constrained by variable considerations) from the provisioncomponent of research and development services to customers. Services revenue is recognized when performance obligations are either satisfied over time or at a point in time. Generally, the provisionexpenses. The Company records accrued liabilities for estimated costs of research and development activities conducted by third-party service providers, which include the conduct of
Share-Basedinvoiced and includes these costs in trade and other payables on the consolidated balance sheets and within research and development expenses on the consolidated statements of operations and comprehensive loss.
Expense
The Company adopted ASU 2018-07 and accounts for non-employee share-based awards in accordance with the measurement and recognition criteria of ASC 718 and recognizes the fair value of such awards over the service period.
2020.2021.
* | Filed herewith. |
** | Furnished, not filed. |
Benitec Biopharma Inc. Dated: February 9, 2021 Jerel Banks Megan Boston Executive Director (principal financial and accounting officer) /s/ Jerel BanksJerel BanksPresident and Chief Executive Officer(principal executive officer)