Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | BIOLIFE SOLUTIONS INC | |
Entity Central Index Key | 834365 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 12,154,858 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2015 |
Balance_Sheets_Unaudited
Balance Sheets (Unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash and cash equivalents | $2,971,840 | $2,538,758 |
Short term investments | 5,606,453 | 7,399,636 |
Accounts receivable, trade, net of allowance for doubtful accounts of $0 at March 31, 2015 and December 31, 2014 | 851,044 | 901,623 |
Inventories | 1,242,787 | 965,224 |
Prepaid expenses and other current assets | 289,018 | 360,521 |
Total current assets | 10,961,142 | 12,165,762 |
Property and equipment | ||
Leasehold improvements | 1,284,491 | 1,284,491 |
Furniture and computer equipment | 500,313 | 476,788 |
Manufacturing and other equipment | 989,989 | 972,386 |
Subtotal | 2,774,793 | 2,733,665 |
Less: Accumulated depreciation | -1,161,706 | -1,078,060 |
Net property and equipment | 1,613,087 | 1,655,605 |
Internal use software | 334,640 | 0 |
Intangible asset | 2,215,385 | 2,215,385 |
Long term deposits | 36,166 | 36,166 |
Total assets | 15,160,420 | 16,072,918 |
Current liabilities | ||
Accounts payable | 900,348 | 474,662 |
Accrued expenses and other current liabilities | 160,898 | 121,869 |
Accrued compensation | 272,923 | 535,029 |
Deferred rent | 130,216 | 130,216 |
Total current liabilities | 1,464,385 | 1,261,776 |
Long term liabilities | ||
Deferred rent, long term | 848,041 | 874,825 |
Total liabilities | 2,312,426 | 2,136,601 |
Commitments and Contingencies (Note 10) | ||
Shareholders' equity (deficiency) | ||
Common stock, $0.001 par value; 150,000,000 shares authorized,12,107,101 and 12,084,859 shares issued and outstanding at March 31, 2015 and December 31, 2014 | 12,107 | 12,084 |
Additional paid-in capital | 71,969,748 | 71,911,328 |
Accumulated other comprehensive loss | -949 | -6,448 |
Accumulated deficit | -61,144,469 | -60,112,987 |
Total shareholders' equity (deficiency) | 10,836,437 | 11,803,977 |
Total non-controlling interest equity (deficiency) | 2,011,557 | 2,132,340 |
Total BioLife Solutions, Inc. shareholders' equity (deficiency) | 12,847,994 | 13,936,317 |
Total liabilities and shareholders' equity (deficiency) | $15,160,420 | $16,072,918 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Assets | ||
Accounts receivable allowances | $0 | $0 |
Stockholders Equity | ||
Common stock, par value | $0.00 | $0.00 |
Common stock, authorized | 150,000,000 | 150,000,000 |
Common stock, issued | 12,107,101 | 12,084,859 |
Common stock, outstanding | 12,107,101 | 12,084,859 |
Statements_of_Operations_Unaud
Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Revenue | ||
Product revenue | $1,500,722 | $2,065,030 |
Cost of product sales | 618,099 | 1,161,641 |
Gross profit | 882,623 | 903,389 |
Operating expenses | ||
Research and development | 322,165 | 167,287 |
Sales and marketing | 500,255 | 241,400 |
General and administrative | 1,220,705 | 863,743 |
Total operating expenses | 2,043,125 | 1,272,430 |
Operating loss | -1,160,502 | -369,041 |
Other income (expenses) | ||
Interest income | 8,237 | 0 |
Interest expense | 0 | -177,308 |
Amortization of deferred financing costs | 0 | -13,022 |
Total other income (expenses) | 8,237 | -190,330 |
Net Loss | -1,152,265 | -559,371 |
Net loss attributable to non-controlling interest | 120,783 | 0 |
Net Loss attributable to BioLife Solutions, Inc. | ($1,031,482) | ($559,371) |
Basic and diluted net loss per common share attributable to BioLife Solutions, Inc. | ($0.09) | ($0.10) |
Basic and diluted weighted average common shares used to calculate net loss per common share | 12,100,588 | 5,568,802 |
Statements_of_Comprehensive_In
Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Statements Of Comprehensive Income Loss | ||
Net loss | ($1,152,265) | ($559,371) |
Other comprehensive income | ||
Unrealized gain on available-for-sale investments | 5,499 | 0 |
Total other comprehensive income | 5,499 | 0 |
Comprehensive loss attributable to non-controlling interest | 120,783 | 0 |
Comprehensive loss attributable to BioLife Solutions, Inc. | ($1,025,983) | ($559,371) |
Statements_of_Cash_Flows_Unaud
Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities | ||
Net loss | ($1,152,265) | ($559,371) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation | 83,646 | 62,506 |
Stock-based compensation expense | 33,509 | 51,619 |
Stock to be issued for services | 0 | 80,000 |
Amortization of deferred financing costs | 0 | 13,022 |
Amortization of deferred rent related to lease incentives | -31,750 | -39,778 |
Accretion and amortization on available for sale investments | 40,901 | 0 |
Change in operating assets and liabilities | ||
(Increase) Decrease in Accounts receivable, trade | 50,579 | -316,248 |
Inventories | -277,563 | 123,819 |
Prepaid expenses and other current assets | 72,156 | 88,961 |
Increase (Decrease) in | ||
Accounts payable | 221,046 | -159,087 |
Accrued compensation and other current liabilities | -353,077 | -411,650 |
Accrued interest, related parties | 0 | 177,308 |
Deferred rent | 4,966 | -5,227 |
Net cash used in operating activities | -1,307,852 | -894,126 |
Cash flows from investing activities | ||
Sales of available-for-sale investments | 2,100,000 | 0 |
Purchase of available-for-sale investments | -342,872 | 0 |
Purchase of property and equipment | -41,128 | -18,777 |
Net provided by (used in) investing activities | 1,716,000 | -18,777 |
Proceeds from sale of common stock, net of expenses | 0 | 13,596,230 |
Proceeds from exercise of common stock options | 24,934 | 0 |
Net cash provided by financing activity | 24,934 | 13,596,230 |
Net increase in cash and cash equivalents | 433,082 | 12,683,327 |
Cash and cash equivalents - beginning of period | 2,538,758 | 156,273 |
Cash and cash equivalents - end of period | 2,971,840 | 12,839,600 |
Non-cash investing activities | ||
Costs incurred for capitalized internal use software not paid as of quarter end (amounts are included in liabilities) | 334,640 | 0 |
Non-cash financing activities | ||
Conversion of notes payable and related party accrued interest to equity, net of unamortized deferred finance costs (See Note 1) | $0 | $14,180,193 |
1_Organization_and_Significant
1. Organization and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Notes to Financial Statements | |
1. Organization and Significant Accounting Policies | Business |
BioLife Solutions, Inc. ("BioLife,” “us,” “we,” “our,” or the “Company”) develops, manufactures and markets patented hypothermic storage and cryopreservation solutions for cells and tissues. The Company’s proprietary HypoThermosol® FRS, CryoStor®, and generic BloodStor®, biopreservation media products and SAVSU® precision thermal packaging products are marketed to the biobanking, drug discovery, and regenerative medicine markets, including hospital-based stem cell transplant centers, pharmaceutical companies, cord blood and adult stem cell banks, hair transplant centers, and suppliers of cells to the drug discovery, toxicology testing and diagnostic markets. BioLife’s products are serum-free and protein-free, fully defined, and are formulated to reduce preservation-induced, delayed-onset cell damage and death. BioLife’s enabling technology provides academic and clinical researchers significant improvements in post-thaw cell, tissue, and organ viability and function. Additionally, for our direct, distributor, and contract customers, we perform custom formulation, fill, and finish services. | |
Basis of Presentation | |
We have prepared the accompanying unaudited consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Pursuant to these rules and regulations, we have condensed or omitted certain information and footnote disclosures we normally include in our annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In management’s opinion, we have made all adjustments (consisting only of normal, recurring adjustments) necessary to fairly present our financial position, results of operations and cash flows. Our interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full year. These consolidated financial statements and accompanying notes should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2014 on file with the SEC. | |
There have been no material changes to our significant accounting policies as compared to the significant accounting policies described in the financial statements in our Annual Report on Form 10-K for the year ended December 31, 2014. | |
Principles of Consolidation | |
The consolidated financial statements include the accounts of the Company and its majority-owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. | |
Concentrations of credit risk and business risk | |
In the three months ended March 31, 2015, we derived approximately 11% of our product revenue from one customer. In the three months ended March 31, 2014, we derived approximately 45% of our product revenue from our relationship with one contract manufacturing customer. No other customer accounted for more than 10% of revenue in the three months ended March 31, 2015 or 2014. At March 31, 2015, two customers accounted for approximately 25% of total gross accounts receivable. At December 31, 2014, two customers accounted for approximately 25% of total gross accounts receivable. | |
Revenue from customers located in foreign countries represented 21% and 9% of total revenue during the three months ended March 31, 2015 and 2014, respectively. | |
Internal Use Software | |
We capitalize costs associated with the development of the biologistex web and mobile applications, which we consider internal-use software. Capitalization of costs began in the first quarter of 2015, when we reached the application development stage. Such capitalized costs include external direct costs utilized in developing or obtaining the applications and payroll and payroll-related expenses for employees, who are directly associated with the development of the applications. Capitalization will cease once we have completed all substantial testing, at which time the applications are complete and ready for their intended use. | |
In the three months ended March 31, 2015, we capitalized $0.3 million in costs related to the development of the biologistex web and mobile applications. Maintenance and enhancement costs, including those costs in the post-implementation stages, will be expensed as incurred, unless such costs relate to substantial upgrades and enhancements to the software that result in added functionality, in which case the costs are capitalized. Capitalized costs will be amortized on a straight-line basis over estimated useful life of three years once the software has been commercially deployed. | |
Recent Accounting Pronouncements | |
On May 28, 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers, Topic 606, requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The updated standard becomes effective for us in the first quarter of fiscal 2017. We have not yet selected a transition method and we are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. | |
With the exception of the new revenue standard discussed above, there have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our Consolidated Financial Statements. |
2_Accumulated_Other_Comprehens
2. Accumulated Other Comprehensive Loss | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Equity [Abstract] | |||||
2. Accumulated Other Comprehensive Loss | The following tables show the changes in Accumulated Other Comprehensive Loss by component for the three months ended March 31, 2015: | ||||
Three Months Ended | |||||
March 31, | |||||
2015 | |||||
Unrealized Loss on Investments, Beginning Balance | $ | (6,448 | ) | ||
Unrealized Gain on Investments, Current Period | 5,499 | ||||
Unrealized Loss on Investments, Ending Balance | $ | (949 | ) |
3_Fair_Value_Measurement
3. Fair Value Measurement | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||
3. Fair Value Measurement | In accordance with FASB ASC Topic 820, "Fair Value Measurements and Disclosures," (“ASC Topic 820”), the Company measures its cash and cash equivalents and short term investments at fair value on a recurring basis. ASC Topic 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, ASC Topic 820 establishes a three-tier value fair hierarchy, which prioritizes the inputs used in measuring fair value as follows: | ||||||||||||
Level 1 – Observable inputs that reflect quoted prices (unadjusted) in active markets for identical assets or liabilities. | |||||||||||||
Level 2 – Observable inputs other than quoted prices included in Level 1 for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. | |||||||||||||
Level 3 – Unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. | |||||||||||||
As of March 31, 2015 and December 31, 2014, the Company does not have liabilities that are measured at fair value. | |||||||||||||
The following tables set forth the Company's financial assets measured at fair value on a recurring basis as of March 31, 2015 and December 31, 2014, based on the three-tier fair value hierarchy: | |||||||||||||
As of March 31, 2015 | Level 1 | Level 2 | Total | ||||||||||
Bank deposits | $ | 414,840 | $ | — | $ | 414,840 | |||||||
Money market funds | 2,557,000 | — | 2,557,000 | ||||||||||
Cash and cash equivalents | 2,971,840 | — | 2,971,840 | ||||||||||
Corporate debt securities | 5,606,453 | — | 5,606,453 | ||||||||||
Total | $ | 8,578,293 | $ | — | $ | 8,578,293 | |||||||
As of December 31, 2014 | Level 1 | Level 2 | Total | ||||||||||
Bank deposits | $ | 972,891 | $ | — | $ | 972,891 | |||||||
Money market funds | 1,565,867 | — | 1,565,867 | ||||||||||
Cash and cash equivalents | 2,538,758 | — | 2,538,758 | ||||||||||
Corporate debt securities | 6,799,702 | — | 6,799,702 | ||||||||||
Commercial paper | 599,934 | — | 599,934 | ||||||||||
Short term investments | 7,399,636 | — | 7,399,636 | ||||||||||
Total | $ | 9,938,394 | $ | — | $ | 9,938,394 | |||||||
The fair values of bank deposits, money market funds, corporate debt securities and commercial paper classified as Level 1 were derived from quoted market prices as active markets for these instruments exist. The Company has no level 2 or level 3 financial assets. The Company did not have any transfers between Level 1 and Level 2 of the fair value hierarchy during the three months ended March 31, 2015 and the twelve months ended December 31, 2014. | |||||||||||||
Investments in debt securities at March 31, 2015, are investment grade and carried a long-term rating of BBB or higher. |
4_Short_Term_Investments
4. Short Term Investments | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Investments, All Other Investments [Abstract] | |||||||||||||||||
4. Short Term Investments | The amortized cost and fair value of short term investments as of March 31, 2015 were as follows: | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||
Corporate debt securities | $ | 5,607,402 | $ | — | $ | (949 | ) | $ | 5,606,453 | ||||||||
The amortized cost and fair value of short term investments as of December 31, 2014 were as follows: | |||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||
Corporate debt securities | $ | 6,806,150 | $ | — | $ | (6,448 | ) | $ | 6,799,702 | ||||||||
Commercial paper | 599,934 | — | $ | — | 599,934 | ||||||||||||
Total marketable securities | $ | 7,406,084 | $ | — | $ | (6,448 | ) | $ | 7,399,636 | ||||||||
As of March 31, 2015, there are no short term investments, classified and accounted for as available-for-sale securities that have been in a continuous unrealized loss position in excess of twelve months. | |||||||||||||||||
As of March 31, 2015, all of the Company’s short term investments had maturity dates due within 1 year or less. |
5_Inventories
5. Inventories | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
5. Inventories | Inventory consists of the following at March 31, 2015 and December 31, 2014: | ||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
Raw materials | $ | 367,719 | $ | 362,656 | |||||
Work in progress | 345,314 | 79,012 | |||||||
Finished goods | 529,754 | 523,556 | |||||||
Total | $ | 1,242,787 | $ | 965,224 |
6_Deferred_Rent
6. Deferred Rent | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
6. Deferred Rent | Deferred rent consists of the following at March 31, 2015 and December 31, 2014: | ||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
Landlord-funded leasehold improvements | $ | 1,124,790 | $ | 1,124,790 | |||||
Less accumulated amortization | (280,281 | (248,531 | ) | ||||||
Total | 844,509 | 876,259 | |||||||
Straight line rent adjustment | 133,748 | 128,782 | |||||||
Total deferred rent | $ | 978,257 | $ | 1,005,041 | |||||
During the three month periods ended March 31, 2015 and 2014, the Company recorded $31,750 and $27,063, respectively, in deferred rent amortization of these landlord funded leasehold improvements. | |||||||||
Straight line rent adjustment represents the difference between cash rent payments and the recognition of rent expense on a straight-line basis over the terms of the lease. |
7_Sharebased_Compensation
7. Share-based Compensation | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
7. Share-based Compensation | Stock Options | ||||||||
The following is a summary of stock option activity for the three month period ended March 31, 2015, and the status of stock options outstanding at March 31, 2015: | |||||||||
Three Month Period Ended | |||||||||
31-Mar-15 | |||||||||
Wtd. Avg. | |||||||||
Exercise | |||||||||
Options | Price | ||||||||
Outstanding at beginning of year | 1,390,770 | $ | 1.5 | ||||||
Exercised | (22,242 | ) | 1.12 | ||||||
Outstanding at March 31, 2015 | 1,368,528 | $ | 1.51 | ||||||
Stock options exercisable at March 31, 2015 | 1,233,272 | $ | 1.34 | ||||||
As of March 31, 2015, there was $523,956 of aggregate intrinsic value of outstanding stock options, including $514,621 of aggregate intrinsic value of exercisable stock options. Intrinsic value is the total pretax intrinsic value for all “in-the-money” options (i.e., the difference between the Company’s closing stock price on the last trading day of the quarter and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options on March 31, 2015. This amount will change based on the fair market value of the Company’s stock. There were no options granted in the three months ended March 31, 2015 and 2014. During the quarter ended March 31, 2015 intrinsic value of awards exercised was $20,937. | |||||||||
The fair value of share-based payments made with stock options to employees and non-employee directors was estimated on the measurement date using the Black-Scholes model using the following weighted average assumptions. | |||||||||
We recorded stock compensation expense related to options for the three month periods ended March 31, 2015 and 2014, as follows | |||||||||
Three Month Period Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Research and development costs | $ | 6,944 | $ | 8,135 | |||||
Sales and marketing costs | 5,755 | 2,723 | |||||||
General and administrative costs | 7,773 | 26,165 | |||||||
Cost of product sales | 13,037 | 14,596 | |||||||
Total | $ | 33,509 | $ | 51,619 | |||||
Management applies an estimated forfeiture rate that is derived from historical employee termination data. The estimated forfeiture rate applied for the three month periods ended March 31, 2015 and 2014 was approximately 7%. | |||||||||
As of March 31, 2015, we had approximately $294,196 of unrecognized compensation expense related to unvested stock options. We expect to recognize this compensation expense over a weighted average period of approximately 2.75 years. | |||||||||
During the three months ended March 31, 2014, we issued or committed to issue common stock of the Company with a value of $80,000 for services rendered during the period. These costs were recorded in general and administrative expenses during the period. | |||||||||
On May 4, 2015 the Board of Directors approved the grant of stock options exercisable into approximately 1.2 million shares to be granted to executive and directors following shareholder approval of proposed amendments to the Company’s 2013 Performance Incentive Plan at the Company’s annual meeting on May 4, 2015. | |||||||||
Restricted Stock | |||||||||
At March 31, 2015, there were no unvested restricted stock units outstanding. |
8_Warrants
8. Warrants | 3 Months Ended |
Mar. 31, 2015 | |
Notes to Financial Statements | |
8. Warrants | At March 31, 2015 and December 31, 2014, we had 7,428,141 warrants outstanding and exercisable with a weighted average exercise price of $4.49. The outstanding warrants have expiration dates between November 2015 and March 2021. |
9_Net_Loss_per_Common_Share
9. Net Loss per Common Share | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
9. Net Loss per Common Share | Basic net loss per common share is calculated by dividing the net loss by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated using the weighted average number of common shares outstanding plus dilutive common stock equivalents outstanding during the period. Common stock equivalents are excluded for the three month periods ended March 31, 2015 and 2014, since the effect is anti-dilutive due to the Company’s net losses. Common stock equivalents include stock options and warrants. | ||||||||
Basic weighted average common shares outstanding, and the potentially dilutive securities excluded from loss per share computations because they are anti-dilutive, are as follows as of March 31, 2015 and 2014, respectively: | |||||||||
Three Month Period Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Basic and diluted weighted average common stock shares outstanding | 12,100,588 | 5,568,802 | |||||||
Potentially dilutive securities excluded from loss per share computations: | |||||||||
Common stock options | 1,368,528 | 1,370,465 | |||||||
Common stock purchase warrants | 7,428,141 | 7,428,141 |
10_Commitments_Contingencies
10. Commitments & Contingencies | 3 Months Ended |
Mar. 31, 2015 | |
Notes to Financial Statements | |
10. Commitments & Contingencies | Leases |
We lease approximately 30,000 square feet in our Bothell, Washington headquarters. The term of our lease continues until July 31, 2021 with two options to extend the term of the lease, each of which is for an additional period of five years, with the first extension term commencing, if at all, on August 1, 2021, and the second extension term commencing, if at all, immediately following the expiration of the first extension term. In accordance with the amended lease agreement, our monthly base rent is approximately $59,700, with scheduled annual increases each August and again in October for the most recent amendment. We are also required to pay an amount equal to the Company’s proportionate share of certain taxes and operating expenses. | |
Employment agreements | |
We have employment agreements with the Chief Executive Officer, Chief Financial Officer, Chief Technology Officer, Chief Operating Officer, Vice President, Marketing and Vice President, Global Sales. None of these employment agreements is for a definitive period, but rather each will continue indefinitely until terminated in accordance with its terms. The agreements provide for a base annual salary, payable in monthly (or shorter) installments. In addition, the agreement with the Chief Executive Officer provides for incentive bonuses at the discretion of the Board of Directors. Under certain conditions and for certain of these officers, we may be required to pay additional amounts upon terminating the officer or upon the officer resigning for good reason. | |
biologistex | |
Our biologistex joint venture committed to purchase approximately $2.4 million in Smart Containers from SAVSU. As of March 31, 2015, the purchase commitment is $2.4 million. | |
We agreed to pay SAVSU $1 million in consideration of SAVSU’s participation in the biologistex joint venture. If certain performance requirements are met, these costs to SAVSU will be recorded in monthly increments for twelve months. As of March 31, 2015, we have recorded $0.4 million related to this commitment. | |
Litigation | |
From time to time, the Company is subject to various legal proceedings that arise in the ordinary course of business, none of which are currently material to the Company’s business. |
1_Organization_and_Significant1
1. Organization and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Notes to Financial Statements | |
Business | BioLife Solutions, Inc. ("BioLife,” “us,” “we,” “our,” or the “Company”) develops, manufactures and markets patented hypothermic storage and cryopreservation solutions for cells and tissues. The Company’s proprietary HypoThermosol® FRS, CryoStor®, and generic BloodStor®, biopreservation media products and SAVSU® precision thermal packaging products are marketed to the biobanking, drug discovery, and regenerative medicine markets, including hospital-based stem cell transplant centers, pharmaceutical companies, cord blood and adult stem cell banks, hair transplant centers, and suppliers of cells to the drug discovery, toxicology testing and diagnostic markets. BioLife’s products are serum-free and protein-free, fully defined, and are formulated to reduce preservation-induced, delayed-onset cell damage and death. BioLife’s enabling technology provides academic and clinical researchers significant improvements in post-thaw cell, tissue, and organ viability and function. Additionally, for our direct, distributor, and contract customers, we perform custom formulation, fill, and finish services. |
Basis of Presentation | We have prepared the accompanying unaudited consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Pursuant to these rules and regulations, we have condensed or omitted certain information and footnote disclosures we normally include in our annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In management’s opinion, we have made all adjustments (consisting only of normal, recurring adjustments) necessary to fairly present our financial position, results of operations and cash flows. Our interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full year. These consolidated financial statements and accompanying notes should be read in conjunction with the financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2014 on file with the SEC. |
There have been no material changes to our significant accounting policies as compared to the significant accounting policies described in the financial statements in our Annual Report on Form 10-K for the year ended December 31, 2014. | |
Principles of Consolidation | The consolidated financial statements include the accounts of the Company and its majority-owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. |
Concentration of Credit Risk and Business Risk | In the three months ended March 31, 2015, we derived approximately 11% of our product revenue from one customer. In the three months ended March 31, 2014, we derived approximately 45% of our product revenue from our relationship with one contract manufacturing customer. No other customer accounted for more than 10% of revenue in the three months ended March 31, 2015 or 2014. At March 31, 2015, two customers accounted for approximately 25% of total gross accounts receivable. At December 31, 2014, two customers accounted for approximately 25% of total gross accounts receivable. |
Revenue from customers located in foreign countries represented 21% and 9% of total revenue during the three months ended March 31, 2015 and 2014, respectively. | |
Internal Use Software | We capitalize costs associated with the development of the biologistex web and mobile applications, which we consider internal-use software. Capitalization of costs began in the first quarter of 2015, when we reached the application development stage. Such capitalized costs include external direct costs utilized in developing or obtaining the applications and payroll and payroll-related expenses for employees, who are directly associated with the development of the applications. Capitalization will cease once we have completed all substantial testing, at which time the applications are complete and ready for their intended use. |
In the three months ended March 31, 2015, we capitalized $0.3 million in costs related to the development of the biologistex web and mobile applications. Maintenance and enhancement costs, including those costs in the post-implementation stages, will be expensed as incurred, unless such costs relate to substantial upgrades and enhancements to the software that result in added functionality, in which case the costs are capitalized. Capitalized costs will be amortized on a straight-line basis over estimated useful life of three years once the software has been commercially deployed. | |
Recent Accounting Pronouncements | On May 28, 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers, Topic 606, requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is not permitted. The updated standard becomes effective for us in the first quarter of fiscal 2017. We have not yet selected a transition method and we are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. |
With the exception of the new revenue standard discussed above, there have been no new accounting pronouncements not yet effective that have significance, or potential significance, to our Consolidated Financial Statements. |
2_Accumulated_Other_Comprehens1
2. Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Accumulated Other Comprehensive Loss Tables | |||||
Schedule of accumulated other comprehensive Loss | Three Months Ended | ||||
March 31, | |||||
2015 | |||||
Unrealized Loss on Investments, Beginning Balance | $ | (6,448 | ) | ||
Unrealized Gain on Investments, Current Period | 5,499 | ||||
Unrealized Loss on Investments, Ending Balance | $ | (949 | ) |
3_Fair_Value_Measurement_Table
3. Fair Value Measurement (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Fair Value Measurement Tables | |||||||||||||
Schedule of fair value measurements | As of March 31, 2015 | Level 1 | Level 2 | Total | |||||||||
Bank deposits | $ | 414,840 | $ | — | $ | 414,840 | |||||||
Money market funds | 2,557,000 | — | 2,557,000 | ||||||||||
Cash and cash equivalents | 2,971,840 | — | 2,971,840 | ||||||||||
Corporate debt securities | 5,606,453 | — | 5,606,453 | ||||||||||
Total | $ | 8,578,293 | $ | — | $ | 8,578,293 | |||||||
As of December 31, 2014 | Level 1 | Level 2 | Total | ||||||||||
Bank deposits | $ | 972,891 | $ | — | $ | 972,891 | |||||||
Money market funds | 1,565,867 | — | 1,565,867 | ||||||||||
Cash and cash equivalents | 2,538,758 | — | 2,538,758 | ||||||||||
Corporate debt securities | 6,799,702 | — | 6,799,702 | ||||||||||
Commercial paper | 599,934 | — | 599,934 | ||||||||||
Short term investments | 7,399,636 | — | 7,399,636 | ||||||||||
Total | $ | 9,938,394 | $ | — | $ | 9,938,394 |
4_Short_Term_Investments_Table
4. Short Term Investments (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Short Term Investments Tables | |||||||||||||||||
Schedule of available for sale securities | The amortized cost and fair value of short term investments as of March 31, 2015 were as follows: | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||
Corporate debt securities | $ | 5,607,402 | $ | — | $ | (949 | ) | $ | 5,606,453 | ||||||||
The amortized cost and fair value of short term investments as of December 31, 2014 were as follows: | |||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||
Corporate debt securities | $ | 6,806,150 | $ | — | $ | (6,448 | ) | $ | 6,799,702 | ||||||||
Commercial paper | 599,934 | — | $ | — | 599,934 | ||||||||||||
Total marketable securities | $ | 7,406,084 | $ | — | $ | (6,448 | ) | $ | 7,399,636 |
5_Inventories_Tables
5. Inventories (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
Inventories | March 31, | December 31, | |||||||
2015 | 2014 | ||||||||
Raw materials | $ | 367,719 | $ | 362,656 | |||||
Work in progress | 345,314 | 79,012 | |||||||
Finished goods | 529,754 | 523,556 | |||||||
Total | $ | 1,242,787 | $ | 965,224 |
6_Deferred_Rent_Tables
6. Deferred Rent (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
Deferred rent | March 31, | December 31, | |||||||
2015 | 2014 | ||||||||
Landlord-funded leasehold improvements | $ | 1,124,790 | $ | 1,124,790 | |||||
Less accumulated amortization | (280,281 | (248,531 | ) | ||||||
Total | 844,509 | 876,259 | |||||||
Straight line rent adjustment | 133,748 | 128,782 | |||||||
Total deferred rent | $ | 978,257 | $ | 1,005,041 |
7_Sharebased_Compensation_Tabl
7. Share-based Compensation (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
Summary of stock option activity | Three Month Period Ended | ||||||||
31-Mar-15 | |||||||||
Wtd. Avg. | |||||||||
Exercise | |||||||||
Options | Price | ||||||||
Outstanding at beginning of year | 1,390,770 | $ | 1.5 | ||||||
Exercised | (22,242 | ) | 1.12 | ||||||
Outstanding at March 31, 2015 | 1,368,528 | $ | 1.51 | ||||||
Stock options exercisable at March 31, 2015 | 1,233,272 | $ | 1.34 | ||||||
Stock compensation expense | Three Month Period Ended | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Research and development costs | $ | 6,944 | $ | 8,135 | |||||
Sales and marketing costs | 5,755 | 2,723 | |||||||
General and administrative costs | 7,773 | 26,165 | |||||||
Cost of product sales | 13,037 | 14,596 | |||||||
Total | $ | 33,509 | $ | 51,619 |
9_Net_Loss_per_Common_Share_Ta
9. Net Loss per Common Share (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Notes to Financial Statements | |||||||||
Loss Per share computation | Three Month Period Ended | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Basic and diluted weighted average common stock shares outstanding | 12,100,588 | 5,568,802 | |||||||
Potentially dilutive securities excluded from loss per share computations: | |||||||||
Common stock options | 1,368,528 | 1,370,465 | |||||||
Common stock purchase warrants | 7,428,141 | 7,428,141 |
2_Accumulated_Other_Comprehens2
2. Accumulated Other Comprehensive Income (Loss) (Details) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Accumulated Other Comprehensive Income Loss Details | |
Unrealized Loss on Investments, Beginning Balance | ($6,448) |
Unrealized Gain on Investments, Current Period | 5,499 |
Unrealized Loss on Investments, Ending Balance | ($949) |
3_Fair_Value_Measurement_Detai
3. Fair Value Measurement (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Bank deposits | $414,840 | $972,891 |
Money market funds | 2,557,000 | 1,565,867 |
Cash and cash equivalents | 2,971,840 | 2,538,758 |
Corporate debt securities | 5,606,453 | 6,799,702 |
Commercial paper | 0 | 599,934 |
Short term investments | 0 | 7,399,636 |
Assets measured at fair value | 8,578,293 | 9,938,394 |
Level 1 | ||
Bank deposits | 414,840 | 972,891 |
Money market funds | 2,557,000 | 1,565,867 |
Cash and cash equivalents | 2,971,840 | 2,538,758 |
Corporate debt securities | 5,606,453 | 6,799,702 |
Commercial paper | 0 | 599,934 |
Short term investments | 0 | 7,399,636 |
Assets measured at fair value | 8,578,293 | 9,938,394 |
Level 2 | ||
Bank deposits | 0 | 0 |
Money market funds | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Corporate debt securities | 0 | 0 |
Commercial paper | 0 | 0 |
Short term investments | 0 | 0 |
Assets measured at fair value | $0 | $0 |
4_Short_Term_Investments_Detai
4. Short Term Investments (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Dec. 31, 2014 | |
Amortized Cost | $5,607,402 | $7,406,084 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | -949 | -6,448 |
Fair Value | 5,606,453 | 7,399,636 |
Corporate debt securities | ||
Amortized Cost | 5,607,402 | 6,806,150 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | -949 | -6,448 |
Fair Value | 5,606,453 | 6,799,702 |
Commercial paper | ||
Amortized Cost | 0 | 599,934 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | $0 | $599,934 |
5_Inventories_Details
5. Inventories (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Inventories Details | ||
Raw materials | $367,719 | $362,656 |
Work in progress | 345,314 | 79,012 |
Finished goods | 529,754 | 523,556 |
Total | $1,242,787 | $965,224 |
6_Deferred_Rent_Details
6. Deferred Rent (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Deferred Rent Details | ||
Landlord-funded leasehold improvements | $1,124,790 | $1,124,790 |
Less accumulated amortization | -280,281 | 248,531 |
Total | 844,509 | 876,259 |
Straight line rent adjustment | 133,748 | 128,782 |
Total deferred rent | $978,257 | $1,005,041 |
6_Deferred_Rent_Details_Narrat
6. Deferred Rent (Details Narrative) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Deferred Rent Details | ||
Deferred rent | $31,750 | $27,063 |
7_Sharebased_Compensation_Deta
7. Share-based Compensation (Details) (Employee Stock Option [Member], USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Employee Stock Option [Member] | |
Number of Shares | |
Outstanding at beginning of year, Shares | 1,390,770 |
Exercised, Shares | -22,242 |
Outstanding at March 31, 2015 | 1,368,528 |
Stock options exercisable at March 31, 2015 | 1,233,272 |
Wtd. Avg Exercise Price | |
Outstanding at beginning of year, Wtd. Avg. Shares Exercise Price | $1.50 |
Exercised, Wtd. Avg. Shares Exercise Price | $1.12 |
Outstanding at March 31, 2015, Wtd. Avg. Shares Exercise Price | $1.51 |
Stock options exercisable at March 31, 2015, Wtd. Avg. Shares Exercise Price | $1.34 |
7_Sharebased_Compensation_Deta1
7. Share-based Compensation (Details 2) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share based compensation | $33,509 | $51,619 |
Research and development costs | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share based compensation | 6,944 | 8,135 |
Sales and marketing costs | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share based compensation | 5,755 | 2,723 |
General and administrative costs | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share based compensation | 7,773 | 26,165 |
Cost of product sales | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share based compensation | $13,037 | $14,596 |
8_Warrants_Details_Narrative
8. Warrants (Details Narrative) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Warrants Details Narrative | ||
Warrants outstanding and exercisable | $7,428,141 | $7,428,141 |
Outstanding warrants expiration dates | The outstanding warrants have expiration dates between November 2015 and March 2021. |
9_Net_Loss_per_Common_Share_De
9. Net Loss per Common Share (Details) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Basic and diluted weighted average common stock shares outstanding | 12,100,588 | 5,568,802 |
Common stock options | ||
Potentially dilutive securities excluded from loss per share computations: | ||
Shares | 1,368,528 | 1,370,465 |
Common stock purchase warrants | ||
Potentially dilutive securities excluded from loss per share computations: | ||
Shares | 7,428,141 | 7,428,141 |