Filed
Pursuant to Rule 424(b)(3)
Registration
No. 333-278512
PROSPECTUS
SUPPLEMNT NO. 2
![](https://www.sec.gov/Archives/edgar/data/1712762/000149315224032229/form424b3_001.jpg)
bioAffinity
Technologies, Inc.
1,632,000
Shares of Common Stock
This
prospectus supplement updates, amends and supplements the prospectus contained in our Amendment No. 1 to Form S-1, effective as of April
15, 2024 (as supplemented or amended from time to time, the “Prospectus”) (Registration No. 333-278512). Capitalized terms
used in this prospectus supplement and not otherwise defined herein have the meanings specified in the Prospectus.
This
prospectus supplement is being filed to update, amend and supplement the information included in the Prospectus with certain of information
contained in our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (the “SEC”) on August 14,
2024, which is set forth below.
This
prospectus supplement is not complete without the Prospectus. This prospectus supplement should be read in conjunction with the Prospectus,
which is to be delivered with this prospectus supplement, and is qualified by reference thereto, except to the extent that the information
in this prospectus supplement updates or supersedes the information contained in the Prospectus. Please keep this prospectus supplement
with your Prospectus for future reference.
Our
shares of common stock are listed on the Nasdaq Capital Market under the symbol “BIAF”. On August 13, 2024, the closing price
for our shares of common stock on the Nasdaq Capital Market was $1.72 per share.
Investing
in our securities involves a high degree of risk. Before deciding whether to invest in our securities, you should consider carefully
the risks and uncertainties under the heading “Risk Factors” beginning on page 8 of the Prospectus.
Neither
the SEC nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of
the Prospectus or this prospectus supplement. Any representation to the contrary is a criminal offense.
The
date of this prospectus supplement is August 14, 2024
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
(Mark
One)
|
☒ |
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|
|
|
|
|
For
the quarterly period ended June 30, 2024 |
|
|
|
|
☐ |
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|
|
|
|
|
For
the transition period from ______ to ______. |
COMMISSION
FILE NUMBER: 001-41463
bioAffinity
Technologies, Inc.
(Exact
name of registrant as specified in its charter)
Delaware |
|
46-5211056 |
(State
or other jurisdiction of
incorporation or organization) |
|
(I.R.S.
Employer
Identification No.) |
|
|
|
22211
W. Interstate 10, Suite 1206, San Antonio, Texas |
|
78257 |
(Address
of principal executive offices) |
|
(Zip
Code) |
(210)
698-5334
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name, former address and former fiscal year, if changed since last report)
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
Common
Stock, par value $0.007 per share |
|
BIAF |
|
The
Nasdaq Stock Market LLC |
Tradeable
Warrants to purchase Common Stock |
|
BIAFW |
|
The
Nasdaq Stock Market LLC |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to the filing requirements for the past 90 days. Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files). Yes ☒ No ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
|
Large
accelerated filer ☐ |
Accelerated
filer ☐ |
|
Non-accelerated
filer ☒ |
Smaller
reporting company ☒ |
|
|
Emerging
growth company ☒ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Sec 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The
number of shares of the issuer’s common stock outstanding as of August 12, 2024, was 13,449,165.
Throughout
this Quarterly Report on Form 10-Q (this “Quarterly Report”), the terms “bioAffinity,” “bioAffinity Technologies,”
“we,” “us,” “our” or “the Company” refer to bioAffinity Technologies, Inc., a Delaware
corporation, and its wholly owned subsidiaries, OncoSelect® Therapeutics, LLC, a Delaware limited liability company, and
Precision Pathology Laboratory Services, LLC, a Texas limited liability company.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
Quarterly Report contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are
predictive in nature, depend on or refer to future events or conditions, and are sometimes identified by words such as “may,”
“could,” “plan,” “project,” “predict,” “pursue,” “believe,” “expect,”
“estimate,” “anticipate,” “intend,” “target,” “seek,” “potentially,”
“will likely result,” “outlook,” “budget,” “objective,” “trend,” or similar
expressions of a forward-looking nature and the negative versions of such expressions. The forward-looking information contained in this
report is generally located under the heading “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” but may be found in other locations as well. The forward-looking statements in this report generally relate to the
plans and objectives for future operations of bioAffinity Technologies, Inc. and are based on our management’s reasonable estimates
of future results or trends. Although we believe these forward-looking statements are reasonable, all forward-looking statements are
subject to various risks and uncertainties, and our projections and expectations may be incorrect. The factors that may affect our expectations
regarding our operations include, among others, the following:
|
● |
our
projected financial position and estimated cash burn rate; |
|
|
|
|
● |
our
estimates regarding expenses, future revenues, and capital requirements; |
|
|
|
|
● |
the
success, cost, and timing of our clinical trials; |
|
|
|
|
● |
our
ability to obtain funding for our operations necessary to complete further development and commercialization of our diagnostic tests
or therapeutic product candidates; |
|
|
|
|
● |
our
dependence on third parties, including the conduct of our clinical trials; |
|
|
|
|
● |
our
ability to obtain the necessary regulatory approvals to market and commercialize our diagnostic tests or therapeutic product candidates; |
|
|
|
|
● |
the
potential that the results of our pre-clinical and clinical trials indicate our current diagnostic tests or any future diagnostic
tests or therapeutic product candidates we may seek to develop are unsafe or ineffective; |
|
|
|
|
● |
the
results of market research conducted by us or others; |
|
|
|
|
● |
our
ability to obtain and maintain intellectual property (“IP”) protection for our current diagnostic test or future diagnostic
tests and therapeutic product candidates; |
|
|
|
|
● |
our
ability to protect our IP rights and the potential for us to incur substantial costs from lawsuits to enforce or protect our IP rights; |
|
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|
● |
the
possibility that a third party may claim we or our third-party licensors have infringed, misappropriated, or otherwise violated their
IP rights and that we may incur substantial costs and be required to devote substantial time defending against such claims; |
|
|
|
|
● |
the
success of competing therapies, diagnostic tests, and therapeutic products that are or will become available; |
|
|
|
|
● |
our
ability to expand our organization to accommodate potential growth and to retain and attract key personnel; |
|
|
|
|
● |
our
potential to incur substantial costs resulting from product liability lawsuits against us and the potential for such lawsuits to
cause us to limit the commercialization of our diagnostic tests and therapeutic product candidates; |
|
|
|
|
● |
market
acceptance of our diagnostic test and diagnostic tests in development and therapeutic product candidates, the size and growth of
the potential markets for our current diagnostic test, diagnostic tests in development, and therapeutic product candidates, and any
future diagnostic tests and therapeutic product candidates we may seek to develop, and our ability to serve those markets; |
|
|
|
|
● |
the
successful development of our commercialization capabilities, including sales and marketing capabilities; |
|
|
|
|
● |
compliance
with government regulations, including environmental, health, and safety regulations and liabilities thereunder; |
|
|
|
|
● |
the
impact of a health epidemic on our business, our clinical trials, our research programs, healthcare systems, or the global economy
as a whole; |
|
|
|
|
● |
general
instability of economic and political conditions in the United States, including inflationary pressures, increased interest rates,
economic slowdown or recession, and escalating geopolitical tensions; |
|
● |
compliance
with government regulations, including environmental, health, and safety regulations, and
liabilities thereunder;
|
|
● |
anticipated
uses of net proceeds from our financings.
|
|
● |
the
increased expenses associated with being a public company; and |
|
|
|
|
● |
other
factors discussed elsewhere in this Quarterly Report. |
Many
of the foregoing risks and uncertainties, as well as risks and uncertainties that are currently unknown to us, are, and may be, exacerbated
by factors such as the ongoing conflict between Ukraine and Russia, the war in the Middle East, escalating tensions between China and
Taiwan, increasing economic uncertainty and inflationary pressures, and any consequent worsening of the global business and economic
environment. New factors emerge from time to time, and it is not possible for us to predict all such factors. Should one or more of the
risks or uncertainties described in this Quarterly Report or any other filing with the Securities and Exchange Commission (the “SEC”)
occur or should the assumptions underlying the forward-looking statements we make herein and therein prove incorrect, our actual results
and plans could differ materially from those expressed in any forward-looking statements. We undertake no obligation to update publicly
any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
You
should read this Quarterly Report and the documents that we reference within it with the understanding that our actual future results,
performance, and events and circumstances may be materially different from what we expect.
Website
and Social Media Disclosure
We
use our websites (www.bioaffinitytech.com, ir.bioaffinitytech.com, www.cypathlung.com and www.precisionpath.us/) to share Company information.
Information contained on or that can be accessed through our websites is not, however, incorporated by reference in this Quarterly Report.
Investors should not consider any such information to be part of this Quarterly Report.
bioAffinity
Technologies, Inc.
FORM
10-Q
TABLE
OF CONTENTS
PART
I
FINANCIAL
INFORMATION
ITEM
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
bioAffinity
Technologies, Inc.
Condensed
Consolidated Balance Sheets
| |
June 30, 2024 | | |
December 31, 2023 | |
| |
(unaudited) | | |
| |
ASSETS | |
| | | |
| | |
Current assets: | |
| | | |
| | |
Cash and cash equivalents | |
$ | 801,311 | | |
$ | 2,821,570 | |
Accounts and other receivables, net | |
| 1,595,626 | | |
| 811,674 | |
Inventory | |
| 29,768 | | |
| 18,484 | |
Prepaid expenses and other current assets | |
| 253,726 | | |
| 321,017 | |
Total current assets | |
| 2,680,431 | | |
| 3,972,745 | |
| |
| | | |
| | |
Non-current assets: | |
| | | |
| | |
Property and equipment, net | |
| 449,250 | | |
| 458,633 | |
Operating lease right-of-use asset, net | |
| 324,942 | | |
| 370,312 | |
Finance lease right-of-use asset, net | |
| 973,358 | | |
| 1,165,844 | |
Goodwill | |
| 1,404,486 | | |
| 1,404,486 | |
Intangible assets, net | |
| 804,306 | | |
| 833,472 | |
Other assets | |
| 19,675 | | |
| 16,060 | |
| |
| | | |
| | |
Total assets | |
$ | 6,656,448 | | |
$ | 8,221,552 | |
| |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | |
| | | |
| | |
| |
| | | |
| | |
Current liabilities: | |
| | | |
| | |
Accounts payable | |
$ | 848,102 | | |
$ | 604,789 | |
Accrued expenses | |
| 969,093 | | |
| 1,149,811 | |
Unearned revenue | |
| 26,135 | | |
| 33,058 | |
Operating lease liability, current portion | |
| 98,593 | | |
| 94,708 | |
Finance lease liability, current portion | |
| 380,259 | | |
| 365,463 | |
Notes payable, current portion | |
| 4,106 | | |
| — | |
Total current liabilities | |
| 2,326,288 | | |
| 2,247,829 | |
| |
| | | |
| | |
Non-current liabilities: | |
| | | |
| | |
Finance lease liability, net of current portion | |
| 641,566 | | |
| 835,467 | |
Operating lease liability, net of current portion | |
| 232,714 | | |
| 283,001 | |
Notes payable, net of current portion | |
| 22,766 | | |
| — | |
| |
| | | |
| | |
Total liabilities | |
| 3,223,334 | | |
| 3,366,297 | |
| |
| | | |
| | |
Commitments and contingencies (Note 11) | |
| - | | |
| - | |
| |
| | | |
| | |
Stockholders’ equity: | |
| | | |
| | |
Preferred stock, par value $0.001 per share; 20,000,000 shares authorized; no shares issued or outstanding at June 30, 2024, and December 31, 2023 | |
| — | | |
| — | |
Common stock, par value $0.007 per share; 100,000,000 shares authorized; 11,487,046 and 9,394,610 issued and outstanding at June 30, 2024, and December 31, 2023, respectively | |
| 79,407 | | |
| 65,762 | |
Additional paid-in capital | |
| 52,030,280 | | |
| 49,393,972 | |
Accumulated deficit | |
| (48,676,573 | ) | |
| (44,604,479 | ) |
| |
| | | |
| | |
Total stockholders’ equity | |
| 3,433,114 | | |
| 4,855,255 | |
| |
| | | |
| | |
Total liabilities and stockholders’ equity | |
$ | 6,656,448 | | |
$ | 8,221,552 | |
The
accompanying notes are an integral part of these condensed consolidated financial statements.
bioAffinity
Technologies, Inc.
Unaudited
Condensed Consolidated Statements of Operations
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
Three Months Ended
June 30, | | |
Six Months Ended
June 30, | |
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
| | |
| | |
| | |
| |
Net Revenue | |
$ | 2,397,652 | | |
$ | 19,738 | | |
$ | 4,804,043 | | |
$ | 20,659 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Direct costs and expenses | |
| 1,407,710 | | |
| 1,234 | | |
| 2,981,151 | | |
| 1,322 | |
Research and development | |
| 402,433 | | |
| 335,125 | | |
| 796,072 | | |
| 704,741 | |
Clinical development | |
| 51,462 | | |
| 35,260 | | |
| 100,422 | | |
| 54,888 | |
Selling, general, and administrative | |
| 2,472,775 | | |
| 1,404,917 | | |
| 4,658,719 | | |
| 2,552,792 | |
Depreciation and amortization | |
| 151,070 | | |
| 21,552 | | |
| 300,707 | | |
| 43,236 | |
| |
| | | |
| | | |
| | | |
| | |
Total operating expenses | |
| 4,485,450 | | |
| 1,798,088 | | |
| 8,837,071 | | |
| 3,356,979 | |
| |
| | | |
| | | |
| | | |
| | |
Loss from operations | |
| (2,087,798 | ) | |
| (1,778,350 | ) | |
| (4,033,028 | ) | |
| (3,336,320 | ) |
| |
| | | |
| | | |
| | | |
| | |
Other income (expense): | |
| | | |
| | | |
| | | |
| | |
Interest income | |
| 5,186 | | |
| 44,124 | | |
| 11,313 | | |
| 82,778 | |
Interest expense | |
| (22,249 | ) | |
| (1,360 | ) | |
| (45,799 | ) | |
| (3,015 | ) |
Other expense | |
| 1 | | |
| — | | |
| 4,511 | | |
| — | |
| |
| | | |
| | | |
| | | |
| | |
Total other income (expense) | |
| (17,062 | ) | |
| 42,764 | | |
| (29,975 | ) | |
| 79,763 | |
| |
| | | |
| | | |
| | | |
| | |
Net loss before provision for income tax expense | |
| (2,104,860 | ) | |
| (1,735,586 | ) | |
| (4,063,003 | ) | |
| (3,256,557 | ) |
| |
| | | |
| | | |
| | | |
| | |
Income tax expense | |
| 5,419 | | |
| 4,587 | | |
| 9,091 | | |
| 16,406 | |
| |
| | | |
| | | |
| | | |
| | |
Net loss | |
$ | (2,110,279 | ) | |
$ | (1,740,173 | ) | |
$ | (4,072,094 | ) | |
$ | (3,272,963 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net loss per common share, basic and diluted | |
$ | (0.19 | ) | |
$ | (0.20 | ) | |
$ | (0.38 | ) | |
$ | (0.38 | ) |
| |
| | | |
| | | |
| | | |
| | |
Weighted average common shares outstanding | |
| 11,389,308 | | |
| 8,520,714 | | |
| 10,655,483 | | |
| 8,477,656 | |
The
accompanying notes are an integral part of these unaudited consolidated financial statements
bioAffinity
Technologies, Inc.
Unaudited
Condensed Consolidated Statements of Stockholders’ Equity
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| |
For the Six Months Ended June 30, 2024 | |
| |
Preferred Stock | | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Stockholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance at December 31, 2023 | |
| — | | |
$ | — | | |
| 9,394,610 | | |
$ | 65,762 | | |
$ | 49,393,972 | | |
$ | (44,604,479 | ) | |
$ | 4,855,255 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stock-based compensation expense | |
| — | | |
| — | | |
| 284,357 | | |
| 1,991 | | |
| 567,916 | | |
| — | | |
| 569,907 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Exercise of stock options | |
| — | | |
| — | | |
| 208,031 | | |
| 454 | | |
| 74,445 | | |
| — | | |
| 74,899 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Exercise of stock warrants | |
| — | | |
| — | | |
| 48 | | |
| — | | |
| 147 | | |
| — | | |
| 147 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Sale of common stock | |
| — | | |
| — | | |
| 1,600,000 | | |
| 11,200 | | |
| 2,488,800 | | |
| — | | |
| 2,500,000 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Offering costs | |
| — | | |
| — | | |
| — | | |
| — | | |
| (495,000 | ) | |
| — | | |
| (495,000 | ) |
Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (4,072,094 | ) | |
| (4,072,094 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at June 30, 2024 (unaudited) | |
| — | | |
$ | — | | |
| 11,487,046 | | |
$ | 79,407 | | |
$ | 52,030,280 | | |
$ | (48,676,573 | ) | |
$ | 3,433,114 | |
| |
For the Three Months Ended June 30, 2024 | |
| |
Preferred Stock | | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Stockholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance at March 31, 2024 (unaudited) | |
| — | | |
$ | — | | |
| 11,216,491 | | |
$ | 78,515 | | |
$ | 51,744,830 | | |
$ | (46,566,294 | ) | |
$ | 5,257,051 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stock-based compensation expense | |
| — | | |
| — | | |
| 127,324 | | |
| 892 | | |
| 285,303 | | |
| — | | |
| 286,195 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Exercise of stock options | |
| — | | |
| — | | |
| 143,183 | | |
| — | | |
| — | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Exercise of stock warrants | |
| — | | |
| — | | |
| 48 | | |
| — | | |
| 147 | | |
| — | | |
| 147 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (2,110,279 | ) | |
| (2,110,279 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at June 30, 2024 (unaudited) | |
| — | | |
$ | — | | |
| 11,487,046 | | |
$ | 79,407 | | |
$ | 52,030,280 | | |
$ | (48,676,573 | ) | |
$ | 3,433,114 | |
| |
For the Six Months Ended June 30, 2023 | |
| |
Preferred Stock | | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Stockholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance at December 31, 2022 | |
| — | | |
$ | — | | |
| 8,381,324 | | |
$ | 58,669 | | |
$ | 47,652,242 | | |
$ | (36,667,468 | ) | |
$ | 11,043,443 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stock-based compensation expense | |
| — | | |
| — | | |
| 174,041 | | |
| 1,218 | | |
| 326,650 | | |
| — | | |
| 327,868 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (3,272,963 | ) | |
| (3,272,963 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at June 30, 2023 (unaudited) | |
| — | | |
$ | — | | |
| 8,555,365 | | |
$ | 59,887 | | |
$ | 47,978,892 | | |
$ | (39,940,431 | ) | |
$ | 8,098,348 | |
| |
For the Three Months Ended June 30, 2023 | |
| |
Preferred Stock | | |
Common Stock | | |
Additional
Paid-in | | |
Accumulated | | |
Stockholders’ | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | |
| |
| | |
| | |
| | |
| | |
| | |
| | |
| |
Balance at March 31, 2023 (unaudited) | |
| — | | |
$ | — | | |
| 8,463,052 | | |
$ | 59,241 | | |
$ | 47,809,283 | | |
$ | (38,200,258 | ) | |
$ | 9,668,266 | |
Balance | |
| — | | |
$ | — | | |
| 8,463,052 | | |
$ | 59,241 | | |
$ | 47,809,283 | | |
$ | (38,200,258 | ) | |
$ | 9,668,266 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Stock-based compensation expense | |
| — | | |
| — | | |
| 92,313 | | |
| 646 | | |
| 169,609 | | |
| — | | |
| 170,255 | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (1,740,173 | ) | |
| (1,740,173 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Balance at June 30, 2023 (unaudited) | |
| — | | |
$ | — | | |
| 8,555,365 | | |
$ | 59,887 | | |
$ | 47,978,892 | | |
$ | (39,940,431 | ) | |
$ | 8,098,348 | |
Balance | |
| — | | |
$ | — | | |
| 8,555,365 | | |
$ | 59,887 | | |
$ | 47,978,892 | | |
$ | (39,940,431 | ) | |
$ | 8,098,348 | |
The
accompanying notes are an integral part of these condensed consolidated financial statements.
bioAffinity
Technologies, Inc.
Unaudited
Condensed Consolidated Statements of Cash Flows
(unaudited)
| |
2024 | | |
2023 | |
| |
Six Months Ended June 30, | |
| |
2024 | | |
2023 | |
| |
| | |
| |
Cash flows from operating activities | |
| | | |
| | |
Net loss | |
$ | (4,072,094 | ) | |
$ | (3,272,963 | ) |
Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
Depreciation and amortization | |
| 300,707 | | |
| 43,236 | |
Stock-based compensation expense | |
| 569,907 | | |
| 327,868 | |
Changes in operating assets and liabilities: | |
| | | |
| | |
Accounts and other receivables | |
| (783,952 | ) | |
| (79,743 | ) |
Inventory | |
| (11,284 | ) | |
| (4,561 | ) |
Prepaid expenses and other assets | |
| 63,676 | | |
| 251,292 | |
Accounts payable | |
| 243,313 | | |
| (170,638 | ) |
Accrued expenses | |
| (180,718 | ) | |
| (26,231 | ) |
Unearned revenue | |
| (6,923 | ) | |
| 42,750 | |
Operating lease right-of-use asset | |
| (1,032 | ) | |
| — | |
Net cash used in operating activities | |
$ | (3,878,400 | ) | |
$ | (2,888,990 | ) |
| |
| | | |
| | |
Cash flows from investing activities | |
| | | |
| | |
Purchase of property and equipment | |
| (69,672 | ) | |
| (36,175 | ) |
Net cash used in investing activities | |
$ | (69,672 | ) | |
$ | (36,175 | ) |
| |
| | | |
| | |
Cash flows from financing activities | |
| | | |
| | |
Proceeds from issuance of common stock from direct offering, net of underwriting discounts, commissions and offering
expenses of $495,000 | |
| 2,005,000 | | |
| — | |
Proceeds from exercised stock options | |
| 74,899 | | |
| — | |
Proceeds from exercise of warrants | |
| 147 | | |
| — | |
Payment on loans payable | |
| — | | |
| (209,412 | ) |
Proceeds from loans payable | |
| 26,872 | | |
| — | |
Principal repayments on finance leases | |
| (179,105 | ) | |
| — | |
Net cash provided by (used in) financing activities | |
$ | 1,927,813 | | |
$ | (209,412 | ) |
| |
| | | |
| | |
Net decrease in cash and cash equivalents | |
| (2,020,259 | ) | |
| (3,134,577 | ) |
Cash and cash equivalents at beginning of period | |
| 2,821,570 | | |
| 11,413,759 | |
Cash and cash equivalents at end of period | |
$ | 801,311 | | |
$ | 8,279,182 | |
| |
| | | |
| | |
Supplemental disclosures of cash flow information: | |
| | | |
| | |
Interest expense paid in cash | |
$ | 45,799 | | |
$ | 3,015 | |
Income taxes paid in cash | |
| 9,091 | | |
| 16,406 | |
The
accompanying notes are an integral part of these condensed consolidated financial statements.
bioAffinity
Technologies, Inc.
Notes
to Condensed Consolidated Financial Statements
(unaudited)
Note
1. NATURE OF OPERATIONS, ORGANIZATION, AND BASIS OF PRESENTATION
Description
of Business
bioAffinity
Technologies, Inc., a Delaware corporation (the “Company,” or “bioAffinity Technologies”), addresses the need
for noninvasive diagnosis of early-stage cancer and diseases of the lung. The Company also is conducting early-stage research focused
on advancing therapeutic discoveries that could result in broad-spectrum cancer treatments. bioAffinity Technologies develops proprietary
noninvasive diagnostic tests using technology that identifies cancer cells and cell populations indicative of a diseased state for analysis
using proprietary platforms developed using artificial intelligence (“AI”). The Company’s first diagnostic test, CyPath®
Lung, is a noninvasive test for early detection of lung cancer, the leading cause of cancer-related deaths. CyPath®
Lung is offered for sale to physicians by the Company’s subsidiary, Precision Pathology Laboratory Services, LLC (“PPLS”).
Research and optimization of the Company’s proprietary platform for in vitro diagnostics and technologies are conducted
in laboratories at PPLS and The University of Texas at San Antonio. The Company is developing its platform technologies so that in the
future they will be able to detect, monitor, and treat diseases of the lung and other cancers.
Organization
The
Company was formed on March 26, 2014, as a Delaware corporation with its corporate offices located in San Antonio, Texas. On June 15,
2016, the Company formed a wholly owned subsidiary, OncoSelect® Therapeutics, LLC, as a Delaware limited liability company.
On August 14, 2023, the Company formed a wholly owned subsidiary, Precision Pathology Laboratory Services, LLC (“PPLS”),
as a Texas limited liability company, to acquire the assets of Village Oaks Pathology Services, P.A., a Texas professional association
d/b/a Precision Pathology Services (“Village Oaks”), including the clinical pathology laboratory it owned.
Basis
of Presentation
The
accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting
principles in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission
(the “SEC”) for interim financial reporting. The condensed consolidated financial statements are unaudited and in management’s
opinion include all adjustments, including normal recurring adjustments and accruals, necessary for a fair presentation of the results
for the interim periods presented. The condensed consolidated balance sheet as of December 31, 2023, was derived from the audited consolidated
financial statements at that date but does not include all the information and footnotes required by GAAP. Operating results for the
periods presented are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2024, or
any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited annual
consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2023, filed with
the SEC on April 1, 2024 (the “2023 Form 10-K”).
Liquidity
and Capital Resources
In
accordance with Accounting Standards Update (“ASU”) 2014-15, Presentation of Financial Statements – Going Concern
(Subtopic 205-40), the Company has evaluated whether there are conditions and events that raise substantial doubt about the Company’s
ability to continue as a going concern for at least one year after the date the condensed consolidated financial statements are issued.
The
Company has incurred significant losses and negative cash flows from operations since inception and expects to continue to incur
losses and negative cash flows for the foreseeable future. As a result, the Company had an accumulated deficit of approximately
$48.7 million
at June 30, 2024. The Company’s cash and cash equivalents at June 30, 2024, were approximately $0.8 million.
Based on the Company’s current expected level of operating expenditures and the cash and cash equivalents on hand at June 30,
2024, management concludes that there is substantial doubt about the Company’s ability to continue as a going concern for a
period of at least twelve (12) months subsequent to the issuance of the accompanying condensed consolidated financial statements.
Therefore, on August 2, 2024, the Company entered into warrant agreements to existing accredited investors to exercise the current
outstanding warrants and issue additional warrants in return. The Company also entered into a securities purchase agreement with an
institutional investor to purchase common stock shares. Between the warrant and purchase agreements, the Company raised an
additional $1.7
million in cash, see Note 15. Subsequent Events. However, the Company may need to raise further capital through the sale of
additional equity or debt securities or other debt instruments, strategic relationships or grants, or other arrangements to support
its future operations, if revenue from operations does not significantly increase. If such funding is not available or not available
on terms acceptable to the Company, the Company’s current development plan may be curtailed. Furthermore, an alternative
source of funding to the sale of additional equity or debt securities is the exercising of outstanding warrants for which there can
be no guarantee. No adjustments have been made to the presented condensed consolidated financial statements as a result of this
uncertainty.
Note
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use
of Estimates
The
preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed
consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could
differ from those estimates. Significant estimates include the valuation allowance on the Company’s deferred tax assets, stock-based
compensation, valuation of goodwill and intangible assets related to the business combination, allowance for contractual adjustments
and discounts related to service revenues, and the useful lives of fixed assets.
Principles
of Consolidation
The
Company’s condensed consolidated financial statements reflect its financial statements, those of its wholly owned subsidiaries,
and certain variable interest entities where the Company is the primary beneficiary. The accompanying condensed consolidated financial
statements include all the accounts of the Company, its wholly owned subsidiaries, OncoSelect® Therapeutics, LLC and PPLS,
and the variable interest entity, Village Oaks. All significant intercompany balances and transactions have been eliminated.
In
determining whether the Company is the primary beneficiary of a variable interest entity, it applies a qualitative approach that determines
whether it has both (1) the power to direct the economically significant activities of the entity and (2) the obligation to absorb losses
of, or the right to receive benefits from, the entity that could potentially be significant to that entity. The Company continuously
assesses whether it is the primary beneficiary of a variable interest entity as changes to existing relationships or future transactions
may result in the Company consolidating or deconsolidating one or more of its collaborators or partners.
Business
Combination
On
September 18, 2023, the Company, in connection with the Asset Purchase Agreement it entered into with Village Oaks and Roby P. Joyce, M.D., dated September 18, 2023, acquired substantially all the assets and assumed certain liabilities of Village Oaks
in exchange for total consideration of $3,500,000, which consists of: (1) $2.5 million in cash paid at closing and (2) 564,972 shares
of the Company’s Common Stock valued at $1 million. The assets purchased included a clinical pathology laboratory regulated by
the Centers for Medicare and Medicaid Services (“CMS”) and accredited by the College of American Pathologists (“CAP”)
and certified under the Clinical Laboratory Improvement Amendments of 1988 (“CLIA”). The primary reason for the acquisition
is control of the laboratory in which CyPath® Lung is ordered and processed.
The
Company recognized goodwill of $1,404,000 arising from the acquisition. The acquisition is being accounted for as a business combination
in accordance with ASC 805. The Company has determined the preliminary fair values of the accounts receivable, accounts payable, and
accrued expenses that make up the majority of the net working capital assumed in the acquisition. These values are subject to change, within a year of the acquisition date of September 18, 2023,
as the Company performs additional reviews of its assumptions utilized, and any future period adjustments would impact the consolidated
statement of operations post-acquisition.
The
following table summarizes the purchase price and preliminary purchase price allocations relating to the acquisition:
SCHEDULE
OF PURCHASE PRICE AND PRELIMINARY PURCHASE PRICE ALLOCATIONS
| |
| | |
Cash | |
$ | 2,500,000 | |
Common Stock | |
| 1,000,000 | |
Total purchase consideration | |
$ | 3,500,000 | |
Assets | |
| | |
Net working capital (including cash) | |
$ | 912,000 | |
Property and equipment | |
| 326,000 | |
Other assets | |
| 8,000 | |
Customer relationships | |
| 700,000 | |
Trade names and trademarks | |
| 150,000 | |
Goodwill | |
| 1,404,000 | |
Total net assets | |
$ | 3,500,000 | |
Goodwill
represents the excess fair value after the allocation to the identifiable net assets. The calculated goodwill is not deductible for tax
purposes.
The
preliminary purchase price allocations relating to the acquisition previously reported in the Quarterly Report on Form 10-Q filed October
14, 2023, reported net working capital of $1,167,000 and goodwill of $1,149,000. The amounts have been updated to reflect the purchase
price adjustments to accounts payable and accounts receivable that existed at the time of the acquisition. The Company incurred and expensed approximately
$811,000 in acquisition costs.
For
prior year comparative purposes, the pro-forma statement of operations as if combined on January 1, 2023, would result in net revenues
of $3,631,208, net loss of $(3,765,983) and loss per share of $(0.44) for the six months ended June 30, 2023.
Cash
and Cash Equivalents
For
the purpose of the statement of cash flows, the Company considers all highly liquid investments with original maturities of three months
or less at the time of purchase to be cash equivalents. Cash equivalents are stated at cost, which approximates market value, because
of the short maturity of these instruments.
Concentration
of Risk
The
Company has significant cash balances at financial institutions which throughout the year regularly exceed the federally insured limit
of $250,000. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial
condition, results of operations, and cash flow.
Advertising
Expense
The
Company expenses all advertising costs as incurred. Advertising expense was $131,125
and $27,741 for
the six months ended June 30, 2024 and 2023, respectively, and $119,205
and $21,692 for
the three months ended June 30, 2024 and 2023, respectively.
Loss
Per Share
Basic
loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of the Company’s
Common Stock outstanding during the period. Diluted loss per share is computed by dividing net loss attributable to common stockholders
by the sum of the weighted-average number of shares of Common Stock outstanding during the period and the weighted-average number of
dilutive Common Stock equivalents outstanding during the period, using the treasury stock method. Dilutive Common Stock equivalents are
comprised of in-the-money stock options, convertible notes payable, and warrants based on the average stock price for each period using
the treasury stock method.
The
following potentially dilutive securities have been excluded from the computations of weighted average shares of Common Stock outstanding
as of June 30, 2024 and 2023, as they would be anti-dilutive:
SCHEDULE
OF POTENTIALLY DILUTIVE SECURITIES
| |
2024 | | |
2023 | |
| |
As of June 30, | |
| |
2024 | | |
2023 | |
Shares underlying options outstanding | |
| 337,810 | | |
| 806,392 | |
Shares underlying warrants outstanding | |
| 8,838,669 | | |
| 4,649,952 | |
Anti-dilutive securities | |
| 9,176,479 | | |
| 5,456,344 | |
Revenue
Recognition
The
Company recognizes as revenue the amount that reflects the consideration to which it expects to be entitled in exchange for goods sold
or services rendered primarily upon completion of the testing process (when results are reported) or when services have been rendered.
Patient
Service Fee Revenue
Net
revenues from patient service fees accounted for greater than 85% of the Company’s consolidated net revenues for the six months
ended June 30, 2024, and are primarily comprised of a high volume of relatively low-dollar transactions. The laboratory, which provides
clinical testing services and other services, satisfies its performance obligation and recognizes revenues primarily upon completion
of the testing process (when results are reported) or when services have been rendered. The Company estimates the amount of consideration
it expects to be entitled to receive from payer customer groups in exchange for providing services using the portfolio approach. These
estimates include the impact of contractual allowances (including payer denials) and patient price concessions. The portfolios determined
using the portfolio approach consist of the following groups of payer customers: healthcare insurers, government payers (Medicare and
Medicaid programs), client payers and self-pay. Contracts do not contain significant financing components based on the typical period
of time between performance of services and collection of consideration.
The
process for estimating revenues and the ultimate collection of accounts receivable involves significant judgment and estimation. The
Company follows a standard process, which considers historical denial and collection experience and other factors (including the period
of time that the receivables have been outstanding), to estimate contractual allowances and implicit price concessions, recording adjustments
in the current period as changes in estimates. Further adjustments to the allowances, based on actual receipts, may be recorded upon
settlement.
SCHEDULE
OF REVENUE RECOGNITION
| |
2024 | | |
2023 | |
| |
For the six months ended
June 30, | |
| |
2024 | | |
2023 | |
Patient service fees1 | |
$ | 4,209,955 | | |
$ | — | |
Histology service fees | |
| 530,053 | | |
| — | |
Medical director fees | |
| 33,193 | | |
| — | |
Department of Defense observational studies | |
| 6,923 | | |
| — | |
Other revenues2 | |
| 23,919 | | |
| 20,659 | |
Total net revenue | |
$ | 4,804,043 | | |
$ | 20,659 | |
|
1 |
Patient
services fees include direct billing for CyPath® Lung diagnostic test of approximately $199,000. |
|
2 |
Other
revenues include pre-acquisition CyPath® Lung royalty income and laboratory services. |
Property
and Equipment
In
accordance with ASC 360-10, Accounting for the Impairment of Long-Lived Assets, the Company periodically reviews the carrying
value of its long-lived assets, such as property, equipment, and definite-lived intangible assets, to test whether current events or
circumstances indicate that such carrying value may not be recoverable. When evaluating assets for potential impairment, the Company
compares the carrying value of the asset to its estimated undiscounted future cash flows. If an asset’s carrying value exceeds
such estimated cash flows (undiscounted and with interest charges), the Company records an impairment charge for the difference. The
Company did not record any impairment for the three and six months ended June 30, 2024, or fiscal year ended December 31, 2023.
Property
and equipment are carried at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the
estimated useful life of the asset. Amortization of leasehold improvements is computed using the shorter of the lease term or estimated
useful life of the asset. Additions and improvements are capitalized, while repairs and maintenance are expensed as incurred. Useful
lives of each asset class are as follows:
SCHEDULE
OF PROPERTY AND EQUIPMENT USEFUL LIFE
Asset Category | |
Useful Life |
Computer equipment | |
3-5 years |
Computer software | |
3 years |
Equipment | |
3-5 years |
Furniture and fixtures | |
5-7 years |
Vehicles | |
5 years |
Leasehold improvements | |
Lesser of lease term or useful life |
Intangible
Assets
Intangible
assets, net of accumulated amortization, and goodwill are summarized as follows as of June 30, 2024:
SCHEDULE
OF INTANGIBLE ASSETS ADJUSTMENTS
Description | |
Date Acquired | |
Useful Life | |
Cost | | |
Amortization | | |
Net | |
Goodwill | |
9/18/2023 | |
| |
$ | 1,404,486 | | |
$ | — | | |
$ | 1,404,486 | |
Trade names and trademarks | |
9/18/2023 | |
18 years | |
| 150,000 | | |
| (6,527 | ) | |
| 143,473 | |
Customer relationships | |
9/18/2023 | |
14 years | |
| 700,000 | | |
| (39,167 | ) | |
| 660,833 | |
Total intangible assets, net | |
| |
| |
$ | 2,254,486 | | |
$ | (45,694 | ) | |
$ | 2,298,792 | |
The
Company incurred amortization of intangible assets of $29,167
and $0
for the six months ended June 30, 2024 and 2023, respectively, and $14,538
and $0
for the three months ended June 30, 2024 and 2023, respectively.
Recent
Accounting Pronouncements
The
Company continues to monitor new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) and
does not believe any accounting pronouncements issued through the date of this Quarterly Report will have a material impact on the Company’s
condensed consolidated financial statements.
The
Company adopted FASB issued Accounting Standards Update (ASU) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable
Segment Disclosures on December 31, 2023. The Company used the five steps to ASC 280 to evaluate what, if any, segment reporting would
be beneficial for shareholders. These five steps included: 1) evaluate operating segments for aggregation, 2) perform quantitative threshold
tests, 3) evaluate remaining operating segments for aggregation, 4) ensure that 75% of revenue is reported, and 5) consider practical
limit. Based on the analysis above against those five steps, management concludes that segment reporting is required for two segment
operations: 1) diagnostic R&D and 2) laboratory services.
Segment
Information
The
Company is organized in two operating segments, Diagnostic Research and Development (“R&D”) and Laboratory Services, whereby its chief
operating decision maker (“CODM”) assesses the performance of and allocates resources. The CODM is the Chief Executive Officer.
Diagnostic R&D includes research and development and clinical development on diagnostic tests. Any revenues assigned to Diagnostic
R&D are proceeds received from observational studies. Laboratory services include all the operations from Village Oaks and PPLS in
addition to sales and marketing costs of CyPath® Lung from bioAffinity Technologies.
SCHEDULE
OF SEGMENT INFORMATION
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
Three months ended June 30, | | |
Six months ended June 30, | |
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Net revenue: | |
| | | |
| | | |
| | | |
| | |
Diagnostic R&D | |
$ | 4,038 | | |
$ | — | | |
$ | 6,923 | | |
$ | — | |
Laboratory
services 1 | |
| 2,393,614 | | |
| 19,738 | | |
| 4,797,120 | | |
| 20,659 | |
Total net revenue | |
| 2,397,652 | | |
| 19,738 | | |
| 4,804,043 | | |
| 20,659 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Diagnostic R&D | |
| (453,895 | ) | |
| (370,384 | ) | |
| (896,494 | ) | |
| (759,629 | ) |
Laboratory services | |
| (2,535,285 | ) | |
| (1,235 | ) | |
| (5,272,284 | ) | |
| (1,322 | ) |
General corporate activities | |
| (1,496,270 | ) | |
| (1,426,469 | ) | |
| (2,668,293 | ) | |
| (2,596,028 | ) |
Total operating loss | |
| (2,087,798 | ) | |
| (1,778,350 | ) | |
| (4,033,028 | ) | |
| (3,336,320 | ) |
| |
| | | |
| | | |
| | | |
| | |
Non-operating income (expense), net | |
| (17,062 | ) | |
| 42,764 | | |
| (29,975 | ) | |
| 79,763 | |
Net loss before income tax expense | |
| (2,104,860 | ) | |
| (1,735,586 | ) | |
| (4,063,003 | ) | |
| (3,256,557 | ) |
Income tax expense | |
| (5,419 | ) | |
| (4,587 | ) | |
| (9,091 | ) | |
| (16,406 | ) |
Net loss | |
$ | (2,110,279 | ) | |
$ | (1,740,173 | ) | |
$ | (4,072,094 | ) | |
$ | (3,272,963 | ) |
1 |
The
majority of the increase versus the prior year is from the acquisition of Precision Pathology Laboratories Services, LLC on September
18, 2023. |
Research
and Development
Research
and development costs are charged to expense as incurred. The Company’s research and development expenses consist primarily of
expenditures for lab operations, preclinical studies, compensation, and consulting costs.
The
Company incurred research and development expenses of $796,072
and $704,741
for the six months ended June 30, 2024 and 2023, respectively, and $402,433
and $335,125
for the three months ended June 30, 2024 and 2023, respectively.
Accrued
Research and Development Costs
The
Company records accrued liabilities for estimated costs of research and development activities conducted by service providers, which
include preclinical studies. The Company records the estimated costs of research and development activities based upon the estimated
amount of services provided but not yet invoiced and includes these costs in accrued expenses in the accompanying condensed consolidated
balance sheets and within research and development expense in the accompanying condensed consolidated statements of operations.
The
Company accrues for these costs based on factors such as estimates of the work completed and in accordance with agreements established
with service providers. The Company makes significant judgments and estimates in determining the accrued expenses balance in each reporting
period. As actual costs become known, the Company adjusts its accrued liabilities. The Company has not experienced any material differences
between accrued costs and actual costs incurred since its inception.
Regulatory
Matters
Regulations
imposed by federal, state, and local authorities in the United States (“U.S.”) are a significant factor in providing medical
care. In the U.S., drugs, biological products, and medical devices are regulated by the Federal Food, Drug, and Cosmetic Act (“FDCA”),
which is administered by the Food and Drug Administration (“FDA”) and the CMS. The Company has not yet obtained marketing
authorization from the FDA but is able to market its CyPath® Lung test as a laboratory developed test (“LTD”)
sold by Precision Pathology Laboratory Services, a CAP-accredited, CLIA-certified clinical pathology laboratory and wholly owned subsidiary.
Note
3. ACCOUNTS AND OTHER RECEIVABLES, NET
The
following is a summary of accounts receivables and other:
SCHEDULE
OF ACCOUNTS RECEIVABLE AND OTHER
| |
June 30, 2024 | | |
December 31, 2023 | |
Patient service fees | |
$ | 1,279,413 | | |
$ | 657,717 | |
Histology service fees | |
| 193,810 | | |
| 121,301 | |
Medical director fees | |
| 3,040 | | |
| 3,103 | |
Other receivables | |
| 119,363 | | |
| 29,553 | |
Total accounts and other receivables, net | |
$ | 1,595,626 | | |
$ | 811,674 | |
Note
4. PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid
expenses and other current assets are summarized below:
SCHEDULE
OF PREPAID EXPENSES AND OTHER CURRENT ASSETS
| |
June 30, 2024 | | |
December 31, 2023 | |
| |
| | |
| |
Prepaid insurance | |
$ | 77,427 | | |
$ | 171,855 | |
Legal and professional | |
| 50,304 | | |
| 24,476 | |
Other | |
| 125,995 | | |
| 124,686 | |
Total prepaid expenses and other current assets | |
$ | 253,726 | | |
$ | 321,017 | |
Note
5. PROPERTY AND EQUIPMENT, NET
Property
and equipment are summarized below:
SCHEDULE OF PROPERTY AND EQUIPMENT
| |
June 30, 2024 | | |
December 31, 2023 | |
| |
| | |
| |
Lab equipment | |
$ | 662,747 | | |
$ | 647,214 | |
Computers and software | |
| 81,433 | | |
| 68,682 | |
Leasehold improvements | |
| 9,941 | | |
| 9,941 | |
Vehicles | |
| 148,103 | | |
| 105,919 | |
Property and equipment, gross | |
| 902,224 | | |
| 831,756 | |
Accumulated depreciation | |
| (452,974 | ) | |
| (373,123 | ) |
Total property and equipment, net | |
$ | 449,250 | | |
$ | 458,633 | |
Depreciation
expense was $79,054
and $41,000 for the
six months ended June 30, 2024 and 2023, respectively, and $40,243
and $21,000 for the
three months ended June 30, 2024 and 2023, respectively.
Note
6. ACCRUED EXPENSES
Accrued
expenses are summarized below:
SCHEDULE OF ACCRUED EXPENSES
| |
June 30, 2024 | | |
December 31, 2023 | |
| |
| | |
| |
Compensation | |
$ | 749,709 | | |
$ | 857,037 | |
Legal and professional | |
| 162,318 | | |
| 257,926 | |
Clinical | |
| 55,315 | | |
| 15,350 | |
Other | |
| 1,751 | | |
| 19,498 | |
Total accrued expenses | |
$ | 969,093 | | |
$ | 1,149,811 | |
Note
7. UNEARNED REVENUE
The
Company engaged in an observational study of CyPath® Lung with the U.S. Department of Defense (“DOD”). A total
of 70 CyPath® Lung units were ordered and shipped. However, in compliance with FASB ASC 606, the performance obligation
was complete for only 37 units as of June 30, 2024. The performance obligation is deemed complete after samples have been collected,
processed, analyzed, and results communicated to patients. The unearned revenue balance amounted to $26,135 and $33,058 as of June 30,
2024, and December 31, 2023, respectively.
Note
8. FAIR VALUE MEASUREMENTS
The
Company analyzes all financial instruments with features of both liabilities and equity under the FASB accounting standard for such instruments.
Under this standard, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant
to the fair value measurement.
The
estimated fair value of certain financial instruments, including cash and cash equivalents, accounts and other receivables, prepaid and
other current assets, accounts payable, accrued expenses, and loan payable, are carried at historical cost basis, which approximates
their fair values because of the short-term nature of these instruments.
Note
9. LEASES
The
Company has one operating lease for its real estate and office space for the CAP/CLIA laboratory, as well as multiple finance leases
for lab equipment in Texas that were acquired through the September 18, 2023 acquisition. The operating lease has a remaining lease
term of 3.08 years as of June 30, 2024. The Company has finance leases consisting of office and lab equipment with remaining lease terms
ranging from approximately 1.75 to 3.50 years as of June 30, 2024, for which the Company has determined that it will use the equipment
for a major part of its remaining economic life.
The
lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach as of September
18, 2023, to derive an appropriate incremental borrowing rate to discount remaining lease payments. The Company benchmarked itself against
other companies of similar credit ratings and comparable quality and derived imputed interest rates ranging from 8.02% to 8.07% for the
lease term lengths.
Leases
with an initial term of 12 months or less are not recorded on the balance sheet. There are no material residual guarantees associated
with any of the Company’s leases, and there are no significant restrictions or covenants included in the Company’s lease
agreements. Certain leases include variable payments related to common area maintenance and property taxes, which are billed by the landlord,
as is customary with these types of charges for office space. The Company has not entered into any lease arrangements with related parties,
and the Company is not the sublessor in any arrangement.
The
Company’s existing leases contain escalation clauses and renewal options. The Company has evaluated several factors in assessing
whether there is reasonable certainty that the Company will exercise a contractual renewal option. For leases with renewal options that
are reasonably certain to be exercised, the Company included the renewal term in the total lease term used in calculating the right-of-use
asset and lease liability.
The
components of lease expense, which are included in selling, general and administrative expense and depreciation and amortization for
the six months ended June 30, 2024 and 2023, are as follows:
SCHEDULE OF COMPONENTS OF LEASE EXPENSE
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
Three months ended June 30, | | |
Six months ended June 30, | |
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
Amortization of right-of-use asset - finance lease | |
$ | 96,243 | | |
$ | — | | |
$ | 192,486 | | |
$ | — | |
Interest on lease liabilities - finance lease | |
| 22,235 | | |
| — | | |
| 45,785 | | |
| — | |
Operating lease cost | |
| 29,916 | | |
| — | | |
| 59,831 | | |
| — | |
Total lease cost | |
$ | 148,394 | | |
$ | — | | |
$ | 298,102 | | |
$ | — | |
| |
| | | |
| | | |
| | | |
| | |
Cash paid for amounts included in the measurement of lease liabilities: | |
| | | |
| | | |
| | | |
| | |
Operating cash flows from finance leases | |
$ | (88,665 | ) | |
$ | — | | |
$ | (179,105 | ) | |
$ | — | |
Operating cash flows from operating leases | |
| (516 | ) | |
| — | | |
| (1,032 | ) | |
| — | |
Supplemental
balance sheet information relating to leases was as follows as of June 30, 2024, and December 31, 2023:
SCHEDULE OF BALANCE SHEET INFORMATION RELATING TO LEASES
Operating leases: | |
June 30, 2024 | | |
December 31, 2023 | |
Operating lease right-of-use asset | |
$ | 324,942 | | |
$ | 370,312 | |
Operating lease liability, current | |
$ | 98,593 | | |
$ | 94,708 | |
Operating lease liability, long-term | |
$ | 232,714 | | |
$ | 283,001 | |
Finance leases: | |
June 30, 2024 | | |
December 31, 2023 | |
Finance lease right-of-use asset, gross | |
$ | 1,294,168 | | |
$ | 1,294,168 | |
Accumulated amortization | |
| (320,810 | ) | |
| (128,324 | ) |
Finance lease right-of-use asset, net | |
$ | 973,358 | | |
$ | 1,165,844 | |
Finance lease liability, current portion | |
$ | 380,259 | | |
$ | 365,463 | |
Finance lease liability, long-term | |
| 641,566 | | |
| 835,467 | |
Total finance lease liabilities | |
$ | 1,021,825 | | |
$ | 1,200,930 | |
Weighted-average remaining lease term: | |
June 30, 2024 | | |
December 31, 2023 | |
Operating leases (in years) | |
| 3.08 | | |
| 3.58 | |
Finance leases (in years) | |
| 2.82 | | |
| 3.25 | |
Weighted-average discount rate: | |
June 30, 2024 | | |
December 31, 2023 | |
Operating leases | |
| 8.07 | % | |
| 8.07 | % |
Finance leases | |
| 8.02 | % | |
| 8.01 | % |
Future
minimum lease payments under non-cancellable lease as of June 30, 2024, are as follows:
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENT UNDER NON-CANCELLABLE
| |
Operating Leases | | |
Finance Leases | |
Remaining for 2024 | |
$ | 60,863 | | |
$ | 224,252 | |
2025 | |
| 121,726 | | |
| 448,505 | |
2026 | |
| 121,726 | | |
| 270,395 | |
2027 and thereafter | |
| 71,007 | | |
| 202,970 | |
Total undiscounted cash flows | |
| 375,322 | | |
| 1,146,122 | |
Less discounting | |
| (44,015 | ) | |
| (124,297 | ) |
Present value of lease liabilities | |
$ | 331,307 | | |
$ | 1,021,825 | |
Note
10. NOTES PAYABLE
Toyota
Corolla - 2024
On
March 18, 2024, the Company entered into a Finance Agreement to purchase a 2024 Toyota Corolla for $33,620 with a maturity date of February
18, 2030. The loan bears fixed interest at a rate of 5.99% per annum, with monthly payments of $467, which is comprised of principal
and interest. This loan is collateralized by the underlying vehicle. The balance of this loan as of June 30, 2024, and December 31, 2023,
is $26,872 and $0, respectively. The current portion of the balance of this loan as of June 30, 2024, and December 31, 2023, is $4,106
and $0, respectively.
Note
11. COMMITMENTS AND CONTINGENCIES
Operating
Leases
In
addition to the operating lease listed in Note 9, the Company leases its corporate offices under a month-to-month agreement and
leases laboratory and additional office space under an operating lease that is renewable annually by written notice by the Company
and will require renewal in September 2024. Rent expense for office and lab space amounted to approximately $60,000
and $53,000 for the six
months ended June 30, 2024 and 2023, respectively, and $31,000
and $26,000 for the three
months ended June 30, 2024, and 2023, respectively.
Legal
Matters
From
time to time, the Company is involved in various disputes and litigation matters that arise in the ordinary course of business. To date,
the Company has no material pending legal proceedings.
Note
12. COMMON STOCK
Common
Stock
The
Company has authorized a total of 100,000,000 shares
of Common Stock, $0.007 par
value per share. On June 4, 2024, the Company received stockholder approval to increase the number of authorized shares of Common
Stock from 25,000,000
shares to 100,000,000
shares and on June 5, 2024, the Company filed an amendment to its Certificate of Incorporation with the Secretary of State of the
State of Delaware to effect the increase. The Company has issued 11,752,178 shares
of Common Stock, of which 265,132 are
unvested restricted stock awards as of June 30, 2024, and 9,505,255 shares
of Common Stock, of which 110,645 are
unvested restricted stock awards as of December 31, 2023.
Note
13. STOCK-BASED COMPENSATION
The
Company granted options and restricted stock awards under its 2014 Equity Incentive Plan (the “2014 Plan”). Under the
2014 Plan, the Company is authorized to grant options or restricted stock for up to 2,000,000
shares of Common Stock. On June 6, 2023, the Company received stockholder approval to increase the number of authorized shares from 1,142,857
to 2,000,000.
Options or restricted stock awards may be granted to employees, the Company’s board of directors, and external consultants who
provide services to the Company. Options and restricted stock awards granted under the 2014 Plan have vesting schedules with terms
of one to three years and become fully exercisable based on specific terms imposed at the date of grant. The 2014 Plan expired
according to the respective 10-year term of the 2014 Plan in March 2024. A new 2024 Incentive Compensation Plan (the “2024
Plan”) was approved at the Annual Meeting of Shareholders on June 4, 2024.
The
Company has recorded stock-based compensation expense related to the issuance of restricted stock awards in the following line items
in the accompanying condensed consolidated statements of operations:
SUMMARY OF STOCK-BASED COMPENSATION EXPENSE RECOGNIZED FOR STOCK OPTION AWARDS
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
Three Months Ended
June 30, | | |
Six Months Ended
June 30, | |
| |
2024 | | |
2023 | | |
2024 | | |
2023 | |
| |
| | |
| | |
| | |
| |
Research and development | |
$ | 35,345 | | |
$ | 10,620 | | |
$ | 57,227 | | |
$ | 21,889 | |
General and administrative | |
| 251,949 | | |
| 159,634 | | |
| 512,680 | | |
| 305,979 | |
Total stock-based compensation
expense | |
$ | 287,294 | | |
$ | 170,254 | | |
$ | 569,907 | | |
$ | 327,868 | |
The
following table summarizes stock option activity under the 2014 and 2024 Plan:
SUMMARY OF OPTION ACTIVITY
| |
Number of
options | | |
Weighted-average
exercise price | | |
Weighted-average
remaining contractual
term (in years) | | |
Aggregate
intrinsic value | |
Outstanding
at December 31, 2023 | |
| 683,695 | | |
$ | 3.99 | | |
| 2.9 | | |
| 158,332 | |
Granted | |
| — | | |
| — | | |
| | | |
| | |
Exercised | |
| (208,031 | ) | |
| 1.16 | | |
| | | |
| | |
Forfeited | |
| (137,854 | ) | |
| 1.16 | | |
| | | |
| | |
Outstanding
at June 30, 2024 | |
| 337,810 | | |
$ | 6.88 | | |
| 5.08 | | |
| — | |
| |
| | | |
| | | |
| | | |
| | |
Vested
and exercisable at June 30, 2024 | |
| 337,612 | | |
$ | 6.88 | | |
| 5.08 | | |
| — | |
As
of June 30, 2024, there was no unrecognized compensation cost related to non-vested stock options.
During
the six months ended June 30, 2024, 208,031
options were exercised at an exercise price of $1.155,
of which 143,183
options were from a cashless exercise, and 137,854
options were forfeited due to a cashless exercise.
The
following table summarizes restricted stock award activity under the 2014 and 2024 Plan:
SUMMARY OF RESTRICTED STOCK AWARD
| |
Number of
restricted stock
awards (RSA) | | |
Weighted-average
grant price | | |
FMV on
grant date | | |
Vested number
of RSA | | |
Unvested number
of RSA | |
Balance at December 31, 2023 | |
| 540,967 | | |
$ | 2.24 | | |
$ | 1,209,391 | | |
| 447,905 | | |
| 93,062 | |
Granted | |
| 419,756 | | |
| 1.66 | | |
| 698,655 | | |
| 266,774 | | |
| 152,982 | |
Forfeited | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Balance at June 30, 2024 | |
| 960,723 | | |
$ | 1.99 | | |
$ | 1,908,046 | | |
| 714,679 | | |
| 246,044 | |
During
the three months ended June 30, 2024, the Company issued restricted stock awards (“RSAs”) for 419,756 shares of Common Stock
to employees, non-employees, and the board of directors. The shares vest in equal monthly installments over terms of between immediately
up to three years, subject to the employees and non-employees providing continuous service through the vesting date. During the three
months ended June 30, 2024, 6,846 shares vested from RSAs granted prior to January 1, 2024, and 266,774 shares vested from RSAs granted
during the six months ended June 30, 2024.
Note
14. WARRANTS
The
Company’s outstanding Common Stock warrants are equity classified. As of June 30, 2024, and December 31, 2023, the Company had
8,838,717 and 4,649,952 warrants outstanding to purchase one share of the Company’s Common Stock for each warrant at a weighted
average exercise price of $3.53 and expire at various dates through March 2029. During the six months ended June 30, 2024, 48 warrants
were exercised into an equivalent number of Common Shares as compared to zero warrants being exercised during the six months ended June
30, 2023.
On
March 8, 2024, the Company issued to certain investors (i) in a registered direct offering, 1,600,000 shares of the Company’s Common
Stock and (ii) in a concurrent private placement, warrants to purchase an aggregate of 1,600,000 shares of Common Stock, with an exercise
price of $1.64 (collectively, the “Transaction”), which Transaction constitutes a Dilutive Issuance under the terms of the
warrants. In addition, the placement agent was granted warrants to purchase 32,000 shares of Common Stock, with an exercise price of
$1.64.
The following table summarizes the calculated
aggregate fair values for the warrant derivative liability using the Black-Scholes method based on the following assumptions for the
March 8, 2024 Direct Offering:
SUMMARY
OF AGGREGATE FAIR VALUES FOR THE WARRANT DERIVATIVE LIABILITY
Exercise price per share of warrant | |
$ | 1.64 | |
Fair market closing price per share of Common Stock | |
$ | 1.56 | |
Volatility | |
| 132 | % |
Expected term (years) | |
| 5 | |
Risk-free interest rate | |
| 4.06 | % |
Dividend yield | |
| 0 | % |
Section
3(b) of the Warrant Agreement executed during the IPO in September 2022 provides that in the event of a Dilutive Issuance, the exercise
price of the warrants shall be reduced and only reduced to equal the effective price per share of the Dilutive Issuance (the “Base
Share Price”), and the number of warrant shares issuable thereunder shall be increased such that the aggregate exercise price payable
pursuant to the warrant, after taking into account the decrease in the exercise price, shall be equal to the aggregate exercise price
prior to such adjustment, provided that the Base Share Price shall not be less than $3.0625 (50% of the public offering price of the
Units sold in the Company’s IPO) (subject to adjustment for reverse and forward stock splits, recapitalizations, and similar transactions).
The
effect of the Transaction was such that the exercise price of the warrants was reduced to $3.0625 per share. The new number of warrant
shares was calculated by dividing (x) the number of warrant shares underlying the warrant immediately prior to the Transaction multiplied
by the exercise price in effect immediately prior to the Transaction, by (y) $3.0625. The calculations was made to the nearest cent
or the nearest 1/100th of a share.
As
of June 30, 2024, and prior to the Transaction, there were tradeable warrants to purchase up to an aggregate of 1,601,259 shares of Common
Stock outstanding and non-tradeable warrants to purchase an aggregate of up to 2,704,506 shares of Common Stock outstanding.
SCHEDULE OF CLASS OF WARRANT
| |
Number of
warrants issued | | |
Weighted-average
exercise price | | |
Number of
warrants exercised | | |
Number of
warrants outstanding | |
Pre-IPO convertible notes | |
| 2,900,904 | | |
$ | 5.31 | | |
| — | | |
| 2,900,904 | |
IPO tradeable | |
| 2,326,834 | | |
| 3.06 | | |
| (725,576 | ) | |
| 1,601,259 | |
IPO non-tradeable | |
| 3,015,464 | | |
| 3.06 | | |
| (310,958 | ) | |
| 2,704,506 | |
Direct offering March 8, 2024 | |
| 1,600,000 | | |
| 1.64 | | |
| — | | |
| 1,600,000 | |
Placement agent direct offering March 8, 2024 | |
| 32,000 | | |
| 1.64 | | |
| — | | |
| 32,000 | |
Balance at June 30, 2024 | |
| 9,875,202 | | |
$ | 3.53 | | |
| (1,036,534 | ) | |
| 8,838,669 | |
Note
15. SUBSEQUENT EVENTS
On
August 2, 2024, the Company entered into warrant exercise agreements with three existing accredited investors to exercise certain outstanding
warrants to purchase an aggregate of 1,041,667
of the Company’s shares of Common Stock
(the “Existing Warrants”). In consideration for the immediate exercise in full of the Existing Warrants for gross cash proceeds
of approximately $1,302,083,
the exercising holders received in a private placement new unregistered warrants (the “New Warrants”) to purchase up to an
aggregate of 1,302,082
shares of Common Stock (equal
to 125% of the shares of Common Stock issued in connection with the exercise of the Existing Warrants)
with an exercise price of $1.50
per share and are initially exercisable on the
date that stockholder approval of the exercise of the New Warrants is obtained and will expire five
years from the date of such approval. In connection
with the exercise of the Existing Warrants, the Company agreed to reduce the exercise price of the Existing Warrants from $1.64
to $1.25
per share. The exercise of the Existing Warrants
and the issuance of the New Warrants occurred on August 5, 2024.
On August 2, 2024, the Company also
entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Purchaser”),
pursuant to which the Company issued to the Purchaser, (i) in a registered direct offering, 360,000 shares of Common Stock, and (ii) in
a concurrent private placement, warrants (the “Private Warrants”) to purchase an aggregate of 450,000 shares of Common Stock
(the “Private Warrant Shares”), with an exercise price of $1.50 (collectively, the “Offering”). The Company received
aggregate gross proceeds from the Offering of approximately $450,000, before deducting fees payable to the placement agent and other estimated
offering expenses payable by the Company.
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This
section presents management’s perspective on our financial condition and results of operations. The following discussion and
analysis (the “MD&A”) is intended to highlight and supplement data and information presented elsewhere in this
Quarterly Report and should be read in conjunction with our interim unaudited condensed consolidated financial statements and notes
elsewhere in this Quarterly Report and our audited consolidated financial statements and the related notes and the discussion under
the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the year
ended December 31, 2023, included in the Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on
April 1, 2024 (the “2023 Form 10-K”). The MD&A is also intended to provide you with information that will assist you in understanding our
consolidated financial statements, the changes in key items in those consolidated financial statements from year to year, and the
primary factors that accounted for those changes. To the extent that this discussion describes prior performance, the descriptions
relate only to the periods listed, which may not be indicative of our future financial outcomes. In addition to historical
information, this discussion contains forward-looking statements that involve risks, uncertainties, and assumptions that could cause
the Company’s financial results to differ materially from management’s expectations. Factors that could cause such
differences are discussed in the “Cautionary Note Regarding Forward-Looking Statements” section of this Quarterly Report
and in the “Risk Factors” section of the 2023 Form 10-K.
Data
as of and for the three and six months ended June 30, 2024 and 2023, has been derived from our unaudited condensed consolidated
financial statements appearing at the beginning of this Quarterly Report. Results for any interim period should not be construed as
an inference of what our results would be for any full fiscal year or future period.
Our
MD&A is organized as follows:
|
● |
Company
Overview – Discussion of our business plan and strategy to provide context for the remainder of the MD&A. |
|
|
|
|
● |
Results
of Operations – Analysis of our financial results comparing the six months and three months ended June 30, 2024, to the
comparable period in 2023. |
|
|
|
|
● |
Liquidity
and Capital Resources – Analysis of changes in our cash flows and discussion of our financial condition and potential sources
of liquidity. |
|
|
|
|
● |
Critical
Accounting Estimates – Accounting estimates that we believe are important to understanding the assumptions and judgments
incorporated in our reported financial results and forecasts. |
Company
Overview
Business
bioAffinity
Technologies, Inc. (the “Company,” “bioAffinity Technologies,” “we,” or “our”)
develops noninvasive diagnostics to detect early-stage lung cancer and other diseases of the lung. We also are conducting
early-stage research focused on advancing therapeutic discoveries that could result in broad-spectrum cancer treatments. We have
developed a proprietary noninvasive diagnostic test using technology that identifies cancer cells and cell populations indicative of a
diseased state for analysis using proprietary platforms developed using AI. Research and optimization of our platform technologies
are conducted in laboratories at our wholly owned subsidiary, Precision Pathology Laboratory Services, LLC (“PPLS”), and
The University of Texas at San Antonio.
Our
diagnostic test, CyPath® Lung, addresses the need for noninvasive detection of early-stage lung cancer. Lung cancer is
the leading cause of cancer-related deaths. Physicians are able to order CyPath® Lung to assist in their assessment of
patients who are at high risk for lung cancer. The CyPath® Lung test enables physicians to more confidently distinguish
between patients who will likely benefit from timely intervention and more invasive follow-up procedures from patients who are likely
without lung cancer and should continue annual screening. CyPath® Lung has the potential to increase overall diagnostic
accuracy of lung cancer, which could lead to increased survival, fewer unnecessary invasive procedures, reduced patient anxiety, and
lower medical costs.
Through
our wholly owned subsidiary, OncoSelect® Therapeutics, LLC, our research has led to discoveries and advancement of novel
cancer therapeutic approaches that specifically and selectively target cancer cells. We are focused on expanding our broad-spectrum platform
technologies to develop tests that detect and therapies that target various types of cancer and potentially other diseases.
Through
our wholly owned subsidiary PPLS, we acquired the assets of Village Oaks Pathology Services, P.A., a Texas professional association d/b/a
Precision Pathology Services, including the clinical pathology laboratory it owned, and we now operate the laboratory.
Recent
Developments
On August 2, 2024 we entered into warrant exercise
agreements with three existing accredited investors to exercise certain outstanding warrants (the “Existing Warrants”) to
purchase an aggregate of 1,041,667 of shares of common stock, par value $0.007 per share (the “Common Stock”). In consideration
for the immediate exercise in full of the Existing Warrants for gross cash proceeds of approximately $1,302,083, the exercising holders
received in a private placement new unregistered warrants (the “New Warrants”) to purchase up to an aggregate of 1,302,083
shares of Common Stock (equal to 125% of the shares of Common Stock issued in connection with the exercise of the Existing Warrants) with
an exercise price of $1.50 per share and are initially exercisable on the date that stockholder approval of the exercise of the New Warrants
is obtained and will expire five years from the date of such approval. In connection with the exercise of the Existing Warrants, we agreed
to reduce the exercise price of the Existing Warrants from $1.64 to $1.25 per share. The exercise of the Existing Warrants and the issuance
of the New Warrants occurred on August 5, 2024.
On August 2, 2024, we also entered into a securities purchase agreement (the “Purchase Agreement”) with an institutional investor (the “Purchaser”), pursuant to which we issued to the Purchaser, (i) in a registered direct offering, 360,000 shares of Common Stock, and (ii) in a concurrent private placement, warrants (the “Private Warrants”) to purchase an aggregate of 450,000 shares of Common Stock (the “Private Warrant Shares”), with an exercise price of $1.50 (collectively, the “Offering”). We received aggregate gross proceeds from the Offering of approximately $450,000, before deducting fees payable to the placement agent and other estimated offering expenses payable by us.
Financial
To
date, we have devoted a substantial portion of our efforts and financial resources to the development of our diagnostic test,
CyPath® Lung. As a result, since our inception in 2014, we have funded our operations principally through private
sales of our equity or debt securities. As of June 30, 2024, we had cash and cash equivalents of $0.8 million. As of August 9, 2024,
after taking into account the August 2024 financing transactions, we had cash and cash equivalents of $1.5 million, which we expect will not support our operations beyond October.
Prior
to the acquisition, Village Oaks, under the trade name Precision Pathology Services, had licensed and developed CyPath®
Lung as an LDT for sale to physicians. The license agreement provided that revenues from the sale would be split evenly between the Company
and Village Oaks. In the second quarter of 2022, prior to the acquisition, we started to recognize revenue as part of a limited beta
market testing program of the CyPath® Lung test. We have never been profitable, and as of June 30, 2024, we had total
working capital of $26,000 and an accumulated deficit of approximately $48.7 million. We expect to continue to incur significant
operating losses for the foreseeable future as we continue the development of our diagnostic tests and advance our diagnostic tests through
clinical trials; however, we do expect revenue to increase due to the acquisition. We intend to license our therapeutic products for
clinical development should animal and pre-clinical studies prove successful.
We
anticipate raising additional cash needed through the private or public sales of equity or debt securities, collaborative arrangements,
or a combination thereof to continue to fund our operations and develop our products. There is no assurance that any such collaborative
arrangement will be entered into or that financing will be available to us when needed in order to allow us to continue our operations
or, if available, on terms acceptable to us. If we do not raise sufficient funds in a timely manner, we may be forced to curtail operations,
delay our clinical trials, cease operations altogether, or file for bankruptcy.
Results
of Operations
Three
Months Ended June 30, 2024, Compared to Three Months Ended June 30, 2023
Net
loss for the three months ended June 30, 2024, was approximately $2.1 million, compared to a net loss of approximately $1.7 million for
the three months ended June 30, 2023.
Revenue
Post-acquisition,
additional revenue streams have been consolidated starting September 19, 2023. PPLS generates three sources of revenue: (1) patient service
fees, (2) histology service fees, and (3) medical director fees. Pre-acquisition, bioAffinity Technologies’ revenue was generated
in three ways: (1) royalties from the Company’s diagnostic test, CyPath® Lung, (2) clinical flow cytometry services
provided to Village Oaks related to the Company’s CyPath® Lung test, and (3) CyPath® Lung tests purchased
by the U.S. Department of Defense (“DOD”) for an observational study, “Detection of Abnormal Respiratory Cell Populations in Lung Cancer Screening Patients Using
the CyPath® Lung Assay (NCT05870592),” and research and development on using bronchoalveolar lavage fluid as a biological
sample to assess cardiopulmonary function and exercise performance in military personnel post-COVID-19 infection. The royalty income
from CyPath® Lung and clinical flow cytometry services income, beginning September 19, 2023, are related party income
and, therefore, eliminated from consolidated net revenues. See net revenue summarized in the table below.
| |
For the three months ended June 30, | |
| |
2024 | | |
2023 | |
Patient service fees1 | |
$ | 2,060,906 | | |
$ | — | |
Histology service fees | |
| 292,081 | | |
| — | |
Medical director fees | |
| 17,135 | | |
| — | |
Department of Defense observational studies | |
| 4,038 | | |
| — | |
Other revenues2 | |
| 23,492 | | |
| 19,738 | |
Total net revenue | |
$ | 2,397,652 | | |
$ | 19,738 | |
1
Patient services fees include direct billing for CyPath® Lung diagnostic test.
2
Other revenues include pre-acquisition CyPath® Lung royalty income and laboratory services.
Operating
Expenses
| |
Three Months Ended | | |
Change in 2024 | |
| |
June 30, | | |
Versus 2023 | |
| |
2024 | | |
2023 | | |
$ | | |
% | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Direct costs and expenses | |
$ | 1,407,710 | | |
$ | 1,234 | | |
$ | 1,406,476 | | |
| 113,977 | % |
Research and development | |
| 402,433 | | |
| 335,125 | | |
| 67,308 | | |
| 20 | % |
Clinical development | |
| 51,462 | | |
| 35,260 | | |
| 16,202 | | |
| 46 | % |
Selling, general and administrative | |
| 2,472,775 | | |
| 1,404,917 | | |
| 1,067,858 | | |
| 76 | % |
Depreciation and amortization | |
| 151,070 | | |
| 21,552 | | |
| 129,518 | | |
| 601 | % |
Total operating expenses | |
$ | 4,485,450 | | |
$ | 1,798,088 | | |
$ | 2,687,362 | | |
| 149 | % |
Operating
expenses totaled approximately $4.5 million and $1.8 million during the three months ended June 30, 2024 and 2023, respectively. The
increase in operating expenses is the result of the following factors:
Direct
costs and expenses
Our
direct costs and expenses are primarily direct labor for pathology services, laboratory supplies and reagents, laboratory equipment,
and allocated shared facilities. Direct costs and expenses totaled $1.4 million and $1,234 during the three months ended June 30, 2024
and 2023, respectively. The increase of approximately $1.4 million for 2024 compared to 2023 was primarily attributable to the laboratory
operations of the newly acquired PPLS in 2024 that did not exist in 2023.
Research
and Development Expenses
Our
research and development expenses consist primarily of expenditures for lab operations, preclinical and clinical studies, compensation,
and consulting costs.
Research
and development expenses totaled $402,433 and $335,125 for the three months ended June 30, 2024 and 2023, respectively. The increase
of approximately $67,000, or 20%, for the three months ended June 30, 2024, compared to the same period in 2023 was primarily due to
an increase in compensation costs and benefits as we added research personnel, as well as a related increase in costs for lab supplies
and reagents.
Clinical
Development
Clinical
development expenses totaled $51,462 and $35,260 for the three months ended June 30, 2024 and 2023, respectively. The increase of approximately
$16,000, or 46%, for the three months ended June 30, 2024, compared to the same period in 2023 was primarily attributable to an increase
in compensation costs and benefits as we added clinical development personnel.
Selling,
General and Administrative
Our
selling, general and administrative expenses consist primarily of expenditures related to employee compensation, selling and marketing
costs, legal, accounting and tax, other professional services, and general operating expenses.
Selling,
general and administrative expenses totaled approximately $2.5 million and $1.4 million for the three months ended June 30, 2024 and
2023, respectively. The increase of approximately $1.1 million, or 76%, for the three months ended June 30, 2024, compared to the same
period in 2023 was primarily attributable to acquired general and administrative costs from PPLS and an increase in employee compensation
related to administrative and sales due to additional personnel and support services to support the launch of sales of our diagnostic
test, CyPath® Lung.
Depreciation
and Amortization
Depreciation
and amortization expenses totaled $151,070 and $21,552 for the three months ended June 30, 2024 and 2023, respectively. The increase
of approximately $130,000, or 601% for the three months ended June 30, 2024, compared to the same period in 2023 was primarily attributable
to the acquired assets from PPLS during the prior year acquisition.
Other
Income (Expense)
Other
income (expense), net totaled ($17,062) and $42,764 for the three month period ended June 30, 2024 and 2023, respectively. The decrease
in the other income of $59,826 is mostly attributable to a reduction in interest income of $38,938 which is due to lower cash balance in
money market savings account, and an increase in interest expense of $20,889 related to equipment finance lease from the acquired PPLS
lab as compared to the same period last year.
Six
Months Ended June 30, 2024, Compared to Six Months Ended June 30, 2023
Net
loss for the six months ended June 30, 2024, was approximately $4.1 million, compared to a net loss of approximately $3.3 million for
the six months ended June 30, 2023.
Revenue
Post-acquisition,
additional revenue streams have been consolidated starting September 19, 2023. PPLS generates three sources of revenue: (1) patient service
fees, (2) histology service fees, and (3) medical director fees. Pre-acquisition, bioAffinity Technologies’ revenue was generated
in three ways: (1) royalties from the Company’s diagnostic test, CyPath® Lung, (2) clinical flow cytometry services
provided to Village Oaks related to the Company’s CyPath® Lung test, and (3) CyPath® Lung tests purchased
by the DOD for an observational study, “Detection of Abnormal Respiratory Cell Populations in Lung Cancer Screening Patients Using
the CyPath® Lung Assay (NCT05870592),” and research and development on using bronchoalveolar lavage fluid as a biological
sample to assess cardiopulmonary function and exercise performance in military personnel post-COVID-19 infection. The royalty income
from CyPath® Lung and clinical flow cytometry services income, beginning September 19, 2023, are related party income
and, therefore, eliminated from consolidated net revenues. See net revenue summarized in the table below.
| |
For the six months ended June 30, | |
| |
2024 | | |
2023 | |
Patient service fees1 | |
$ | 4,209,955 | | |
$ | — | |
Histology service fees | |
| 530,053 | | |
| — | |
Medical director fees | |
| 33,193 | | |
| — | |
Department of Defense observational studies | |
| 6,923 | | |
| — | |
Other revenues2 | |
| 23,919 | | |
| 20,659 | |
Total net revenue | |
$ | 4,804,043 | | |
$ | 20,659 | |
1
Patient services fees include direct billing for CyPath® Lung diagnostic test.
2
Other revenues include pre-acquisition CyPath® Lung royalty income and laboratory services.
Operating
Expenses
| |
Six Months Ended | | |
Change in 2024 | |
| |
June 30, | | |
Versus 2023 | |
| |
2024 | | |
2023 | | |
$ | | |
% | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Direct costs and expenses | |
$ | 2,981,151 | | |
$ | 1,322 | | |
$ | 2,979,829 | | |
| 225,403 | % |
Research and development | |
| 796,072 | | |
| 704,742 | | |
| 91,331 | | |
| 13 | % |
Clinical development | |
| 100,422 | | |
| 54,888 | | |
| 45,534 | | |
| 83 | % |
Selling, general and administrative | |
| 4,658,719 | | |
| 2,552,792 | | |
| 2,105,927 | | |
| 82 | % |
Depreciation and amortization | |
| 300,707 | | |
| 43,236 | | |
| 257,471 | | |
| 596 | % |
Total operating expenses | |
$ | 8,837,071 | | |
$ | 3,356,979 | | |
$ | 5,480,092 | | |
| 163 | % |
Operating
expenses totaled approximately $8.8 million and $3.4 million during the six months ended June 30, 2024 and 2023, respectively. The
increase in operating expenses is the result of the following factors:
Direct
costs and expenses
Our
direct costs and expenses are primarily direct labor for pathology services, laboratory supplies and reagents, laboratory equipment,
and allocated shared facilities. Direct costs and expenses totaled $2,981,151 and $1,322 during the six months ended June 30, 2024
and 2023, respectively. The increase of approximately $3.0 million for 2024 compared to 2023 was primarily attributable to the laboratory
operations of the newly acquired PPLS in 2024 that did not exist in 2023.
Research
and Development Expenses
Our
research and development expenses consist primarily of expenditures for lab operations, preclinical and clinical studies, compensation,
and consulting costs.
Research
and development expenses totaled $796,072 and $704,742 for the six months ended June 30, 2024 and 2023, respectively. The increase of
approximately $91,000, or 13%, for the six months ended June 30, 2024, compared to the same period in 2023 was primarily due to an increase
in compensation costs and benefits as we added research personnel, as well as a related increase in costs for lab supplies and reagents.
Clinical
Development
Clinical
development expenses totaled $100,422 and $54,888 for the six months ended June 30, 2024 and 2023, respectively. The increase of approximately
$46,000, or 83%, for the six months ended June 30, 2024, compared to the same period in 2023 was primarily attributable to an increase
in compensation costs and benefits as we added clinical development personnel.
Selling,
General and Administrative
Our
selling, general and administrative expenses consist primarily of expenditures related to employee compensation, selling and marketing
costs, legal, accounting and tax, other professional services, and general operating expenses.
Selling,
general and administrative expenses totaled approximately $4.7 million and $2.6 million for the six months ended June 30, 2024 and 2023,
respectively. The increase of approximately $2.1 million, or 82%, for the six months ended June 30, 2024, compared to the same period
in 2023 was primarily attributable to acquired general and administrative costs from PPLS and an increase in employee compensation related
to administrative and sales due to additional personnel and support services to support the launch of sales of our diagnostic test, CyPath®
Lung.
Other
Income (Expense)
Other
income (expense), net totaled ($29,975) and $79,763 for the six-month period ended June 30, 2024, and 2023, respectively. The decrease
in the other income of approximately $110,000 is mostly attributable to a reduction in interest income of $71,465 which is due to lower
cash balance in money market savings account, and an increase in interest expense of $42,784 related to equipment finance lease from
the acquired PPLS lab as compared to the same period last year.
Depreciation
and Amortization
Depreciation
and amortization expenses totaled $300,707 and $43,236 for the six months ended June 30, 2024 and 2023, respectively. The increase of
approximately $257,000, or 596% for the six months ended June 30, 2024, compared to the same period in 2023 was primarily attributable
to the acquired assets from PPLS during the prior year acquisition.
Liquidity,
Capital Resources, and Going Concern
To
date, we have funded our operations primarily through our IPO, subsequent registered direct offering, exercise of warrants, and the sale
of our securities, resulting in gross proceeds of approximately $38.5 million. We have evaluated whether there are conditions and events
that raise substantial doubt about our ability to continue as a going concern for at least one year after the date the condensed consolidated
financial statements are issued.
We
have incurred losses since our inception in 2014 as a result of significant expenditures for operations and research and development
and, prior to April 2022, the lack of any approved diagnostic test or therapeutic products to generate revenue. For the three months
ended June 30, 2024 and 2023, we had net losses of $2.1 million and $1.7 million, respectively, and we expect to incur substantial
additional losses in future periods. We have an accumulated deficit of approximately $48.7 million as of June 30, 2024. Despite our
recent financings in August 2024, pursuant to which we raised gross proceeds of approximately $1.7 million, we believe our current cash and anticipated revenue from
operations will not be sufficient to support our operations beyond November 2024. Based on the Company’s current
expected level of operating expenditures, current expected levels of revenue, and the cash and cash equivalents on hand at June 30,
2024, of $0.8 million, management concludes that there is substantial doubt about the Company’s ability to continue as a going
concern for a period of at least twelve (12) months subsequent to the issuance of the accompanying unaudited condensed consolidated
financial statements contained in this Quarterly Report. We need to raise further capital through the sale of additional equity or debt securities or other debt
instruments, strategic relationships or grants, or through exercised outstanding warrants to support our future operations unless
our revenue increases significantly. Our business plan includes expansion for our commercialization efforts which will require
additional funding. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. Our
ability to continue as a going concern is dependent upon our ability to generate revenue and raise capital from financing
transactions. There can be no assurance that we will be successful in accomplishing these objectives.
We
continue to seek sources of financing to fund our continued operations and research and development programs. To raise additional capital,
we may sell additional equity or debt securities, or enter into collaborative, strategic, and/or licensing transactions. There can be
no assurance that we will be able to complete any financing transaction in a timely manner or on acceptable terms or otherwise enter
into a collaborative or strategic transaction. If we are not able to raise additional cash, we may be forced to delay, curtail, or cease
development of our diagnostic tests or therapeutic products, or cease operations altogether.
Summary
Statements of Cash Flows
The
following information reflects cash flows for the periods presented:
| |
Six Months Ended | |
| |
June 30, | |
| |
2024 | | |
2023 | |
| |
| | | |
| | |
Cash and cash equivalents at beginning of period | |
$ | 2,821,570 | | |
$ | 11,413,759 | |
Net cash used in operating activities | |
| (3,878,400 | ) | |
| (2,888,990 | ) |
Net cash used in investing activities | |
| (69,672 | ) | |
| (36,175 | ) |
Net cash provided by (used in) financing activities | |
| 1,927,813 | | |
| (209,412 | ) |
Cash and cash equivalents at end of period | |
$ | 801,311 | | |
$ | 8,279,182 | |
Net
Cash Used in Operating Activities
Net
cash used in operating activities was approximately $3.9 million and $2.9 million for the six months ended June 30, 2024 and 2023,
respectively. The increase of approximately $1.0 million in cash used by operations during the six months ended June 30, 2024,
compared to the same period in 2023 was primarily attributable to an increase of approximately $370,000 in our loss from operations
and an increase in patient accounts receivables of $700,000 due to a change in external professional medical billing providers
effective March 1, 2024. The transition period from the previous to the new medical billing provider has caused a temporary delay in
billing and deposits, as anticipated.
Net
Cash Used in Investing Activities
The
Company used approximately $70,000 for the six months ended June 30, 2024, in investing activities related primarily to the purchase
of computer and lab equipment, compared to approximately $36,000 cash used in investing activities for the six months ended June 30,
2023.
Net
Cash Provided by (Used In) Financing Activities
Cash
provided in financing activities was approximately $1.9 million compared to cash used in financing activities of approximately $210,000
for the six months ended June 30, 2024 and 2023, respectively. The change in proceeds from prior year was primarily related to net proceeds
from the direct offering of common stock securities for $2.5 million on March 8, 2024.
Contractual
Obligations and Commitments
We
enter into contracts in the normal course of business with third-party contract organizations for clinical trials and other services
and products used for research and development and operating purposes. These contracts generally provide for termination following a
certain period after notice, and therefore we believe that any non-cancelable obligations under these agreements are not material.
Critical
Accounting Estimates
The
preparation of financial statements in conformity with U.S. GAAP requires management to make significant judgments and estimates that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Management bases these significant judgments
and estimates on historical experience and other assumptions it believes to be reasonable based upon information presently available.
Actual results could differ from those estimates under different assumptions, judgments, or conditions.
Patient
Fee Revenues
We
follow ASC 606, Revenue from Contracts with Customers, which requires revenue recognition in the period in which the service was
performed. To be able to report timely net revenues for the period, estimates are used for a portion of uncollected balances. These estimates
relate to third-party historical contractual discounts and adjustments (e.g., insurance providers) and patient historical uncollectible
amounts. There can be a significant delay from the time a patient has been serviced to the invoicing of that service and collection of
net proceeds. Historical data is used to determine estimates for those “in service” revenues that have not been billed or
collected at the reporting period.
Patient
Fee Receivables and Considerations for Credit Losses
We
follow accounting considerations of CECL - Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on
Financial Instruments. With the acquisition of PPLS and control of Village Oaks, the Company’s board-certified pathologists
provide anatomic and clinical pathology services for patients and other customers. The Company’s other customer types include contract
research organizations (“CROs”), hospitals, and independent laboratories. The Company enters into contracts with its customers
for these services. The majority of the Company’s revenues stem from fees for services provided to patients, and thus in those
arrangements the patient is the customer, although the services may be requested by a physician on the patient’s behalf. Furthermore,
in addition to its contracts with patients, the Company separately contracts with third-party payers (insurance companies and governmental
payers), who are typically responsible for all or the majority of the fees agreed upon for such services provided to patients. Historically,
material amounts of gross charges are not collected due to various agreements with insurance companies, capped pricing levels for government
payers, and uncollectible balances from individual payers. To estimate these allowances of credit losses, the Company assesses the portfolio
risk segments and historical data on collection rates. These estimated allowances offset patient revenues and accounts receivables.
Discount
Rate for Finance Leased Equipment
We
follow ASC 842, Leases, under which a lessee is required to recognize most leases on its balance sheet. The Company has elected
to apply a third-party valuation increment borrowing rate (“IBR”) as the discount rate by class of underlying assets when
the rate is not implicit in the lease.
Stock-Based
Compensation
We
follow ASC 718, Compensation – Stock Compensation, which requires the measurement and recognition of compensation expense
for all share-based payment awards made to employees, directors, and non-employees based on estimated fair values. We have used the Black-Scholes
option pricing model to estimate grant date fair value for all option grants. The assumptions we use in calculating the fair value of
share-based payment awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application
of management judgment. Since we use different assumptions based on a change in factors, our stock-based compensation expense could be
materially different in the future.
Accounting
for Income Taxes
We
are governed by U.S. income tax laws, which are administered by the Internal Revenue Service (“IRS”). We follow ASC 740,
Accounting for Income Taxes, which requires an asset and liability approach to financial accounting and reporting for income taxes.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. A valuation allowance is provided when it is more likely than not that
some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income and the reversal of deferred tax liabilities during the period in which the related temporary difference
becomes deductible.
Going
Concern
Our
evaluation of our ability to continue as a going concern requires us to evaluate our future sources and uses of cash sufficient to fund
our currently expected operations and research and development activities one year from the date our consolidated financial statements
are issued. We evaluate the probability associated with each source and use of cash resources in making our going concern determination.
The research and development of our diagnostic tests and therapeutic products are inherently subject to uncertainty.
Off-Balance
Sheet Arrangements
We
do not engage in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often
referred to as structured finance or special purpose entities, as a part of our ongoing business. Accordingly, we did not have any off-balance
sheet arrangements during any of the periods presented.
Emerging
Growth Company Status
We
are both an “emerging growth company” and a “smaller reporting company” as defined by Rule 12b-2 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) and are therefore subject to reduced public company reporting requirements.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As
a smaller reporting company, pursuant to Item 305(e) of Regulation S-K promulgated under the Securities Act, we are not required to provide
the information required by this Item 3.
ITEM
4. CONTROLS AND PROCEDURES.
Evaluation
of Disclosure Controls and Procedures
The
Company has adopted and maintains disclosure controls and procedures that are designed to provide reasonable assurance that information
required to be disclosed in the reports filed under the Exchange Act, such as this Quarterly Report, is collected, recorded, processed,
summarized, and reported within the time periods specified under the rules of the SEC. The term “disclosure controls and procedures,”
as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed
to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded,
processed, summarized, and reported within the time periods specified in the rules and forms of the SEC. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the
reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including
its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure. We have adopted and maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed in the reports filed
under the Exchange Act, such as this Quarterly Report on Form 10-Q, is collected, recorded, processed, summarized, and reported within
the time periods specified in the rules of the SEC. The Company’s disclosure controls and procedures are also designed to ensure
that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure. As of June
30, 2024, the end of the period covered by this Quarterly Report, our Chief Executive Officer and Chief Financial Officer evaluated the
effectiveness of our “disclosure controls and procedures,” as defined in Rule 13a-15(e) under the Exchange Act. The Chief
Executive Officer and Chief Financial Officer assessed the effectiveness of our disclosure controls and procedures as of June 30, 2024.
Based on their assessment, they have concluded that, as of June 30, 2024, our disclosure controls and procedures are effective.
Changes
in Internal Control over Financial Reporting
There
were no changes in our internal controls (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) over financial
reporting during the three months ended June 30, 2024, the period covered by this Quarterly Report, that could materially affect, or
are reasonably likely to materially affect, our internal control over financial reporting.
PART
II
ITEM
1. LEGAL PROCEEDINGS.
From
time to time, we are involved in various disputes and litigation matters that arise in the ordinary course of business. To date, we have
had no material pending legal proceedings, and we are not engaged in any legal proceedings that are expected, individually or in the
aggregate, to have a material adverse impact on our financial position or results of operations.
ITEM
1A. RISK FACTORS.
In addition to other information
set forth in this Quarterly Report, you should carefully consider the “Risk Factors” discussed in the 2023 Form 10-K, for a discussion of important factors that could cause actual results to differ materially from the results
described in or implied by the forward-looking statements contained in this Quarterly Report. Additional risks and uncertainties not
currently known to us or that we currently deem to be immaterial might materially adversely affect our actual business, financial condition,
and operating results. The following information updates, and should be read in conjunction with, the information disclosed in Part I,
Item 1A, “Risk Factors,” contained in our 2023 Form 10-K. Except as disclosed below,
there have been no material changes from the risk factors disclosed in our 2023 Form 10-K.
Risks
Related to Our Financial Position
Our
business plan relies upon our ability to obtain additional sources of capital and financing. If the amount of capital we are able to
raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs, we may be
required to cease operations.
During
the six months ended June 30, 2024, and June 30, 2023 we generated revenue of approximately $4.8 million and $20,659, respectively and
for the years ended December 31, 2023, and December 31, 2022, we generated revenue of approximately $2.5 million and $5,000, respectively.
During the six months ended June 30, 2024, and June 30, 2023, we generated $4.2 million from laboratory patient services (of which approximately
$207,000 related to our first diagnostic test, CyPath® Lung), approximately $530,000 from histology laboratory tests,
approximately $33,000 from medical director fees, and approximately $7,000 in connection with CyPath® Lung tests purchased
by the DOD for an observational study. During the year ended December 31, 2023, we generated $2.2 million from laboratory patient services
(of which approximately $37,000 related to our first diagnostic test, CyPath® Lung), approximately $273,000 from histology
laboratory tests, approximately $19,000 from medical director fees, and approximately $19,000 in connection with CyPath®
Lung tests purchased by the DOD for an observational study.
To
become and remain profitable, we must succeed in generating additional laboratory revenue and developing and commercializing our diagnostic
tests and therapeutic products that we expect will generate significant income in the planned timeframe. This will require us to be successful
in a range of challenging activities, including completing preclinical testing and clinical trials of our diagnostic and therapeutic
technologies, obtaining regulatory approval for our diagnostic and therapeutic technologies, manufacturing, marketing, and selling any
diagnostic tests and therapeutic products for which we may obtain regulatory approval, and establishing and managing our collaborations
at various phases of each diagnostic test and therapeutic product candidate’s development. We are in the preliminary phases of
these activities. We may never succeed in these activities and, even if we do, may never generate sufficient income to achieve profitability.
To
become profitable, we must develop our diagnostic tests and therapeutic products, which will depend in large part on our ability to:
|
● |
Develop,
enhance, and protect our diagnostic tests and therapeutic products; |
|
|
|
|
● |
Raise
sufficient funding to support our diagnostic tests and therapeutic product development program(s); |
|
|
|
|
● |
Complete
pre-clinical testing; |
|
● |
Work
with our partners to expand commercialization of our first diagnostic test, CyPath® Lung, as an LDT under the CAP/CLIA
guidelines and regulations administered by CMS and CAP; |
|
|
|
|
● |
Obtain
de novo classification from FDA for our CyPath® Lung as a Class II in vitro diagnostic; |
|
|
|
|
● |
Work
with our partners to develop and commercialize our first diagnostic test, CyPath® Lung, as a CE-marked test in accordance
with the In Vitro Diagnostic Device Regulation (the “IVDR”) of the EU; |
|
|
|
|
● |
Synthesize,
test, and attract licensing partners for drug conjugates, siRNAs, and other therapeutics (and methods for their use) developed by
us; |
|
|
|
|
● |
Develop
and conduct human clinical studies to support the regulatory approval and marketing of our diagnostic test(s) and therapeutic product(s); |
|
|
|
|
● |
Develop
and manufacture the test(s) and product(s) to FDA standards, appropriate EU standards, and appropriate standards required for the
commercialization of our tests and products in countries in which we seek to sell our diagnostic test(s) and therapeutic product(s); |
|
|
|
|
● |
Obtain
the necessary regulatory approvals to market our diagnostic test(s) and therapeutic product(s); |
|
|
|
|
● |
Secure
the necessary personnel and infrastructure to support the development, commercialization, and marketing of our diagnostic test(s)
and therapeutic product(s); and |
|
|
|
|
● |
Develop
strategic relationships to support development, manufacturing, and marketing of our diagnostic test(s) and therapeutic product(s). |
Even
if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to
become and remain profitable would depress the value of our Company and could impair our ability to raise capital, expand our business,
maintain the research and development efforts, diversify our diagnostic tests and therapeutic product offerings, or even continue our
operations. A decline in the value of our Company could also cause our investors to lose all or part of their investment.
We
must raise additional capital to fund our operations in order to continue as a going concern.
As of June 30, 2024, we had an accumulated deficit of $48.7 million. As of August 9, 2024, our cash and cash equivalents
were 1.5 million. Despite our recent financings, we
will need to raise further capital through the sale of additional equity or debt securities or other debt instruments, strategic
relationships or grants, or other arrangements to support our future operations. Our business plan includes expansion for our
commercialization efforts which will require additional funding. If we are unable to improve our liquidity position, we may not be
able to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate revenue
and raise capital from financing transactions. Without funding from the proceeds of a capital raise or strategic relationship or
grant, management anticipates that our cash resources are sufficient to continue operations through October 2024. Our future is
dependent upon our ability to obtain financing and upon future profitable operations from the development of new business
opportunities. There can be no assurance that we will be successful in accomplishing these objectives. Without such additional
capital, we may be required to curtail or cease operations and be required to realize our assets and discharge our liabilities other
than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their
investment. WithumSmith+Brown, PC, our independent registered public accounting firm for the fiscal year ended December 31, 2023,
has included an explanatory paragraph in its opinion that accompanies our audited consolidated financial statements as of and for
the year ended December 31, 2023, indicating that our current liquidity position raises substantial doubt about our ability to
continue as a going concern.
We are unable to precisely estimate when we
will begin to generate significant profit from revenue, if ever, from PPLS’ services, nor to estimate the amount of profit or revenue
that will be generated or the expenses that will be incurred.
We do not expect to immediately derive profit from
revenue from PPLS’ services. Since its acquisition in September 2023, we have generated $7.1 million in revenue from PPLS. Once
we begin to generate such profit, there is no guarantee that it will be sufficient to realize the expected financial benefits of the acquisition.
In addition, since we have limited experience operating a clinical laboratory, we may not accurately estimate the expenses we will incur.
Our failure to file
a registration statement to register the shares of Common Stock issuable upon exercise of the warrants that we issued in August 2024,
or to timely hold a stockholders’ meeting to obtain stockholder approval of the issuance of shares of Common Stock upon the exercise
of the warrants that we issued in August 2024, will result in a breach of the terms of certain agreements.
Pursuant to the terms
of certain agreements that we entered into with certain purchasers and the financial advisor/ placement agent in August 2024, we are
obligated to file a registration statement to register the shares of Common Stock issuable upon exercise of the warrants issued to
such purchasers and designees of the financial advisor/ placement agent within 45 days of the date of such agreement and to use
commercially reasonable efforts to keep the registration statement effective at all times while the purchasers or designees of the
financial advisor/ placement agent own any warrants or shares of Common Stock issuable upon exercise of the warrants. We are also
obligated to hold a stockholders’ meeting 90 days after the closing date and, if approval is not obtained at the shareholders
meeting, every six months thereafter seeking approval of the exercise of the warrants issued to the purchasers. The failure
to take any of these actions will constitute a default under the operative agreement.
Our management collectively
owns a substantial percentage of our Common Stock.
Based on the provisions for
determining beneficial ownership in accordance with Rule 13d-3 and Item 403 of Regulation S-K under the Exchange Act, immediately after
this Offering, our officers and directors will own or exercise control of approximately 27% of the voting power of our outstanding Common
Stock. As a result, investors may be prevented from affecting matters involving our Company, including:
|
● |
the composition of our Board and, through it, any determination with respect to our business direction and policies, including the appointment and removal of officers; |
|
|
|
|
● |
any determinations with respect to mergers or other business combinations; |
|
|
|
|
● |
our acquisition or disposition of assets; and |
|
|
|
|
● |
our corporate financing activities. |
Furthermore, this concentration
of voting power could have the effect of delaying, deterring, or preventing a change of control or other business combination that might
otherwise be beneficial to our stockholders. This significant concentration of share ownership may also adversely affect the trading price
for our Common Stock because investors may perceive disadvantages in owning stock in a company that is controlled by a small number of
stockholders.
ITEM
2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
Unregistered
Sales of Equity Securities
We
did not sell any equity securities during the quarter ended June 30, 2024, in transactions that were not registered under the Securities
Act other than as previously disclosed in our filings with the SEC.
ITEM
3. DEFAULTS UPON SENIOR SECURITIES.
Not
applicable.
ITEM
4. MINE SAFETY DISCLOSURES.
Not
applicable.
ITEM
5. OTHER INFORMATION.
During
the three months ended June 30, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement”
or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
ITEM
6. EXHIBITS.
Exhibit
No. |
|
Title
of Document |
|
|
|
1.1 |
|
Placement Agency Agreement, dated August 2, 2024, by and between bioAffinity Technologies, Inc. and Wallachbeth Capital LLC (Incorporated by reference as Exhibit 1.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
3.2 |
|
Amended and Restated Bylaws of Registrant (Incorporated by reference as Exhibit 3.6 to the Registrant’s Registration Statement on Form S-1/A (File No. 333-264463) filed with the SEC on June 16, 2022) |
3.3 |
|
Certificate of Amendment to the Certificate of Incorporation of Registrant, as filed with the Delaware Secretary of State on May 31, 2016 (Incorporated by reference as Exhibit 3.3 to the Registrant’s Registration Statement on Form S-1 (File No. 333-274608) filed with the SEC on September 20, 2023) |
3.4 |
|
Certificate of Designation of Series A Convertible Preferred Stock of the Registrant filed with the Delaware Secretary of State on July 13, 2017 (Incorporated by reference as Exhibit 3.4 to the Registrant’s Registration Statement on Form S-1/A (File No. 333-264463) filed with the SEC on May 25, 2022) |
3.5 |
|
Certificate of Amendment to the Certificate of Incorporation of Registrant, as filed with the Delaware Secretary of State on November 29, 2021 (Incorporated by reference as Exhibit 3.5 to the Registrant’s Registration Statement on Form S-1 (File No. 333-274608) filed with the SEC on September 20, 2023) |
3.6 |
|
Certificate of Amendment to the Certificate of Incorporation of Registrant, as filed with the Delaware Secretary of State on June 23, 2022 (Incorporated by reference as Exhibit 3.2 to the Registrant’s Registration Statement on Form S-1/A (File No. 333-264463) filed with the SEC on May 25, 2022) |
3.7 |
|
Certificate of Amendment to the Certificate of Incorporation of Registrant, as filed with the Delaware Secretary of State on June 6, 2023 (Incorporated by reference as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on June 7, 2023) |
3.8 |
|
Certificate of Amendment to the Certificate of Incorporation of Registrant, as filed with the Delaware Secretary of State on June 5 2024 (Incorporated by reference as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on June 5, 2024) |
4.1 |
|
Form of Purchase Warrant (Incorporated by reference as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
4.2 |
|
Form of Placement Agent Warrant (Incorporated by reference as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
10.1† |
|
bioAffinity Technologies, Inc. 2024 Incentive Compensation Plan (Incorporated by reference as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on June 5, 2024) |
10.2 |
|
Form of Securities Purchase Agreement, dated as of August 2, 2024, by and among the Company and the investor listed on the signature page thereto (Incorporated by reference as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
10.3 |
|
Form of Warrant Inducement Agreement (Incorporated by reference as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
10.4 |
|
Form of Support Agreement with schedule of signatories (Incorporated by reference as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K (File No. 001-41463) filed with the SEC on August 5, 2024) |
31.1* |
|
Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 |
31.2* |
|
Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 |
32.1* |
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002 |
|
|
|
101* |
|
The
following financial statements from the bioAffinity Technologies, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30,
2024, formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheet, (ii) Condensed Consolidated Statement of Operations, (iii)
Condensed Consolidated Statement of Stockholders’ Equity, (iv) Condensed Consolidated Statement of Cash Flows, and (v) Notes
to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags. |
|
|
|
104* |
|
The
cover page from the bioAffinity Technologies, Inc. Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, formatted
in Inline XBRL |
|
|
|
101.INS |
|
Inline
XBRL Instance Document * |
|
|
|
101.SCH |
|
Inline
XBRL Taxonomy Extension Schema Document * |
|
|
|
101.CAL |
|
Inline
XBRL Taxonomy Extension Calculation Linkbase * |
|
|
|
101.DEF |
|
Inline
XBRL Taxonomy Extension Definition Linkbase Document * |
|
|
|
101.LAB |
|
Inline
XBRL Taxonomy Extension Label Linkbase Document * |
|
|
|
101.PRE |
|
Inline
XBRL Taxonomy Extension Presentation Linkbase Document * |
*
Filed herewith.
†
Indicates management contract or compensatory plan.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
|
BIOAFFINITY
TECHNOLOGIES, INC. |
|
(Registrant) |
|
|
|
By: |
/s/
Maria Zannes |
|
|
Maria
Zannes |
|
|
Chief
Executive Officer, President, Founder, and Director |
|
Date: |
August
14, 2024 |
|
|
|
By: |
/s/
Michael Dougherty |
|
|
Michael
Dougherty
Vice
President and Chief Financial Officer |
|
Date: |
August
14, 2024 |
Exhibit
31.1
Certification
of Chief Executive Officer
Pursuant
to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934,
as
Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
For
the Quarterly Period Ended June 30, 2024
I,
Maria Zannes, certify that:
1. |
I
have reviewed this quarterly report on Form 10-Q of bioAffinity Technologies, Inc. (“registrant”); |
|
|
2. |
Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
the period covered by this report; |
|
|
3. |
Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in
this report; |
|
|
4. |
The
registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
|
(a) |
Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this report is being prepared; |
|
|
|
|
(b) |
Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
|
|
|
|
(c) |
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and |
|
|
|
|
(d) |
Disclosed
in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected,
or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. |
The
registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or
persons performing the equivalent functions): |
|
(a) |
All
significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
and |
|
|
|
|
(b) |
Any
fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting. |
Date:
August 14, 2024
|
/s/
Maria Zannes |
|
Maria
Zannes |
|
President
and Chief Executive Officer |
|
(Principal
Executive Officer) |
Exhibit
31.2
Certification
of the Chief Financial Officer
Pursuant
to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934,
as
Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
For
the Quarterly Period Ended June 30, 2024
I,
Michael Dougherty, certify that:
1. |
I
have reviewed this quarterly report on Form 10-Q of bioAffinity Technologies, Inc. (“registrant”); |
|
|
2. |
Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
the period covered by this report; |
|
|
3. |
Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in
this report; |
|
|
4. |
The
registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
|
(a) |
Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this report is being prepared; |
|
|
|
|
(b) |
Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
|
|
|
|
(c) |
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about
the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and |
|
|
|
|
(d) |
Disclosed
in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected,
or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. |
The
registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or
persons performing the equivalent functions): |
|
(a) |
All
significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
and |
|
|
|
|
(b) |
Any
fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s
internal control over financial reporting. |
Date:
August 14, 2024
|
/s/
Michael Dougherty |
|
Michael
Dougherty |
|
Vice
President and Chief Financial Officer
(Principal
Financial Officer) |
Exhibit
32.1
Certification
of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350
As
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In
connection with the Quarterly Report on Form 10-Q of bioAffinity Technologies, Inc., a Delaware Corporation (“Company”),
for the period ended June 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (“Report”), each
of the undersigned officers of the Company hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002, that to the best of such officer’s knowledge:
|
1) |
the
Report complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|
|
|
|
2) |
the
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations
of the Company as of June 30, 2024 (the last date of the period covered by the Report). |
|
/s/
Maria Zannes |
|
Maria
Zannes |
|
President
and Chief Executive Officer
(Principal
Executive Officer) |
|
Date:
August 14, 2024 |
|
|
|
/s/
Michael Dougherty |
|
Michael
Dougherty |
|
Vice
President and Chief Financial Officer
(Principal
Financial Officer) |
|
Date:
August 14, 2024 |
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