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UNITED STATES

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

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

For the transition period from                  to                 

Delaware			35-2089858
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
4131 ParkLake Ave., Suite 225, Raleigh, NC			27612
(Address of principal executive offices)			(Zip Code)

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, par value $0.001

BDSI

The Nasdaq Global Select Market

Large Accelerated Filer

☐

Accelerated Filer

☒

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

						Page
Part I. Financial Information
Item 1.			Financial Statements (unaudited)
			Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019			1
			Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019			2
			Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2020 and 2019			3
			Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2020 and 2019			5
			Notes to Condensed Consolidated Financial Statements			6
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3.			Quantitative and Qualitative Disclosures about Market Risk			27
Item 4.			Controls and Procedures			28
Cautionary Note on Forward-Looking Statements						28
Part II. Other Information						29
Item 1.			Legal Proceedings			29
Item 1A.			Risk Factors			29
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			29
Item 3.			Defaults upon Senior Securities			29
Item 4.			Mine Safety Disclosures			29
Item 5.			Other Information			29
Item 6.			Exhibits			30
Signatures						S-1
Certifications

From time to time, we may use our website, our Facebook page at Facebook.com/BioDeliverySI, on Twitter at @BioDeliverySI and on LinkedIn at linkedin.com/company/biodeliverysciencesinternational to distribute material information. Our financial and other material information is routinely posted to and accessible on the "Investors" section of our website, available at www.bdsi.com. Investors are encouraged to review the Investors section of our website because we may post material information on that site that is not otherwise disseminated by us. Information that is contained in and can be accessed through our website, our Facebook page, our LinkedIn page and our Twitter posts are not incorporated into, and does not form a part of, this Quarterly Report.

			September 30, 2020						December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents			$	100,177					$	63,888
Accounts receivable, net			43,830						38,790
Inventory, net			18,887						11,312
Prepaid expenses and other current assets			5,754						3,769
Total current assets			168,648						117,759
Property and equipment, net			1,485						2,075
Goodwill			2,715						2,715
License and distribution rights, net			55,109						60,309
Other intangible assets, net			—						47
Total assets			$	227,957					$	182,905
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities			$	53,409					$	53,993
Total current liabilities			53,409						53,993
Notes payable, net			78,363						58,568
Other long-term liabilities			300						580
Total liabilities			132,072						113,141
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred Stock, 5,000,000 shares authorized; Series A Non-Voting Convertible Preferred Stock. $0.001 par value, 0 and 2,093,155 shares outstanding at September 30, 2020 and December 31, 2019, respectively; Series B Non-Voting Convertible Preferred Stock, $0.001 par value, 443 and 618 shares outstanding at September 30, 2020 and December 31, 2019, respectively.			—						2
Common Stock, $0.001 par value; 235,000,000 and 175,000,000 shares authorized at September 30, 2020 and December 31, 2019, respectively; 101,126,452 and 96,189,074 shares issued; 101,110,961 and 96,173,583 shares outstanding at September 30, 2020 and December 31, 2019, respectively.			100						96
Additional paid-in capital			446,910						436,306
Treasury stock, at cost, 15,491 shares, as of September 30, 2020 and December 31, 2019.			(47)						(47)
Accumulated deficit			(351,078)						(366,593)
Total stockholders’ equity			95,885						69,764
Total liabilities and stockholders’ equity			$	227,957					$	182,905

			Three months ended September 30,												Nine months ended September 30,
			2020						2019						2020						2019
Revenues:
Product sales, net			$	38,785					$	29,623					$	112,946					$	77,438
Product royalty revenues			658						683						1,358						2,154
Contract revenues			—						—						—						160
Total Revenues:			39,443						30,306						114,304						79,752
Cost of sales			5,376						5,350						16,371						14,325
Expenses:
Selling, general and administrative			22,461						23,360						77,408						62,304
Total Expenses:			22,461						23,360						77,408						62,304
Income from operations			11,606						1,596						20,525						3,123
Interest expense, net			(2,010)						(1,234)						(4,997)						(17,732)
Other (expense)/income, net			(2)						(3)						6						5
Income/(loss) before income taxes			$	9,594					$	359					$	15,534					$	(14,604)
Income tax provision			(211)						(5)						(19)						(5)
Net income/(loss) attributable to common stockholders			$	9,383					$	354					$	15,515					$	(14,609)
Basic
Weighted average common stock shares outstanding			101,031,317						89,649,922						99,377,748						81,612,112
Basic earnings/(loss) per share			$	0.09					$	—					$	0.16					$	(0.18)
Diluted
Weighted average common stock shares outstanding			105,783,568						105,138,894						104,836,493						81,612,112
Diluted earnings/(loss) per share			$	0.09					$	—					$	0.15					$	(0.18)

			Preferred Stock Series A												Preferred Stock Series B												Common Stock												Additional Paid-In Capital						Treasury Stock						Accumulated Deficit						Total Stockholders’ Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balances, June 30, 2020			—						$	—					443						$	—					100,916,511						$	99					$	445,180					$	(47)					$	(360,462)					$	84,770
Stock-based compensation			—						—						—						—						—						—						1,539						—						—						1,539
Stock option exercises			—						—						—						—						68,623						1						191						—						—						192
Restricted stock awards			—						—						—						—						141,318						—						—						—						—						—
Net income			—						—						—						—						—						—						—						—						9,384						9,384
Balances, September 30, 2020			—						$	—					443						$	—					101,126,452						$	100					$	446,910					$	(47)					$	(351,078)					$	95,885

			Preferred Stock Series A												Preferred Stock Series B												Common Stock												Additional Paid-In Capital						Treasury Stock						Accumulated Deficit						Total Stockholders’ Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balances, June 30, 2019			2,093,155						$	2					1,716						$	—					89,535,024						$	88					$	432,358					$	(47)					$	(366,251)					$	66,150
Stock-based compensation			—						—						—						—						—						—						1,267						—						—						1,267
Stock option exercises			—						—						—						—						52,121						—						123						—						—						123
Restricted stock awards			—						—						—						—						109,629						2						(2)						—						—						—
Series B conversion to common stock			—						—						(18)						—						100,000						—						—						—						—						—
Net loss			—						—						—						—						—						—						—						—						354						354
Balances, September 30, 2019			2,093,155						$	2					1,698						$	—					89,796,774						$	90					$	433,746					$	(47)					$	(365,897)					$	67,894

			Preferred Stock Series A												Preferred Stock Series B												Common Stock												Additional Paid-In Capital						Treasury Stock						Accumulated Deficit						Total Stockholders’ Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balances, January 1, 2020			2,093,155						$	2					618						$	—					96,189,074						$	96					$	436,306					$	(47)					$	(366,593)					$	69,764
Stock-based compensation			—						—						—						—						—						—						7,845						—						—						7,845
Stock option exercises			—						—						—						—						1,159,347						1						2,760						—						—						2,761
Restricted stock awards			—						—						—						—						712,654						—						—						—						—						—
Series A conversion to common stock			(2,093,155)						(2)						—						—						2,093,155						2						—						—						—						—
Series B conversion to common stock			—						—						(175)						—						972,222						1						(1)						—						—						—
Net loss			—						—						—						—						—						—						—						—						15,515						15,515
Balances, September 30, 2020			—						$	—					443						$	—					101,126,452						$	100					$	446,910					$	(47)					$	(351,078)					$	95,885

			Preferred Stock Series A												Preferred Stock Series B												Common Stock												Additional Paid-In Capital						Treasury Stock						Accumulated Deficit						Total Stockholders’ Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balances, January 1, 2019			2,093,155						$	2					3,100						$	—					70,793,725						$	71					$	381,004					$	(47)					$	(351,288)					$	29,742
Stock-based compensation			—						—						—						—						—						—						3,978						—						—						3,978
Stock option exercises			—						—						—						—						412,500						—						1,193						—						—						1,193
Restricted stock awards			—						—						—						—						801,661						1						(1)						—						—						—
Series B conversion to Common Stock			—						—						(1,402)						—						7,788,888						8						(8)						—						—						—
Equity offering, net of finance costs			—						—						—						—						10,000,000						10						47,580						—						—						47,590
Net loss			—						—						—						—						—						—						—						—						(14,609)						(14,609)
Balances, September 30, 2019			2,093,155						$	2					1,698						$	—					89,796,774						$	90					$	433,746					$	(47)					$	(365,897)					$	67,894

			Nine months ended September 30,
			2020						2019
Operating activities:
Net income/(loss)			$	15,515					$	(14,609)
Adjustments to reconcile net income/(loss) to net cash flows from operating activities
Depreciation			467						253
Accretion of debt discount and loan costs			231						11,441
Amortization of intangible assets			5,248						5,084
Provision for inventory obsolescence			(297)						57
Stock-based compensation expense			7,845						3,978
Changes in assets and liabilities:
Accounts receivable			(5,040)						(19,795)
Inventories			(7,278)						(5,416)
Prepaid expenses and other assets			(1,985)						(1,686)
Accounts payable and accrued liabilities			(701)						14,844
Taxes payable			(40)						—
Net cash flows provided by/(used in) operating activities			13,965						(5,849)
Investing activities:
Product acquisitions			—						(20,674)
Acquisitions of equipment			—						(79)
Net cash flows used in investing activities			—						(20,753)
Financing activities:
Proceeds from issuance of common stock			—						48,000
Equity issuance costs			—						(410)
Proceeds from notes payable			20,000						60,000
Proceeds from exercise of stock options			2,761						1,193
Payment on note payable			—						(67,346)
Loss on refinancing of former debt			—						(2,794)
Payment on deferred financing fees			(437)						—
Net cash flows provided by financing activities			22,324						38,643
Net change in cash and cash equivalents			36,289						12,041
Cash and cash equivalents at beginning of period			63,888						43,822
Cash and cash equivalents at end of period			$	100,177					$	55,863
Cash paid for interest			$	5,037					$	3,831

•Product sales-Product sales amounts relate to sales of BELBUCA, Symproic and BUNAVAIL. The Company discontinued marketing of BUNAVAIL in August 2020. The Company recognizes revenue on product sales when control of the promised goods is transferred to its customers in an amount that reflects the consideration expected to be received in exchange for transferring those goods. The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. When determining whether the customer has obtained control of the goods, the Company considers any future performance obligations. Generally, there is no post-shipment obligation on product sold.

•Product royalty revenues-Product royalty revenue amounts are based on sales revenue of the PAINKYL product under the Company’s license agreement with TTY and the BREAKYL product under the Company’s license agreement with Meda AB, which was acquired by Mylan N.V. (which we refer to herein as Mylan). Product royalty revenues are recognized when control of the product is transferred to the license partner in an amount that reflects the consideration expected to be received. Supplemental sales-based product royalty revenue may also be earned upon the subsequent sale of the product at agreed upon contractual rates.

•Contract revenue-Contract revenue amounts are related to milestone payments under the Company’s license agreements with its partners.

•specific contractual terms of agreements with customers;

•estimated levels of inventory in the distribution channel;

•historical rebates, chargebacks and returns of products;

•direct communication with customers;

•anticipated introduction of competitive products or generics;

•anticipated pricing strategy changes by the Company and/or its competitors;

•analysis of prescription data gathered by third-party prescription data providers;

•the impact of changes in state and federal regulations; and

•the estimated remaining shelf life of products.

			Level 1						Level 2						Level 3						Balance at September 30, 2020
Cash and cash equivalents			$	100,177					$	—					—						$	100,177

			September 30, 2020						December 31, 2019
Raw materials			$	3,497					$	624
Work-in-process			10,025						6,198
Finished goods			5,452						4,874
Obsolescence reserve			(87)						(384)
Total inventories			$	18,887					$	11,312

			September 30, 2020						December 31, 2019
Accounts payable			$	8,244					$	11,704
Accrued rebates			28,156						28,528
Accrued compensation and benefits			5,603						5,545
Accrued returns			6,947						4,438
Accrued royalties			684						535
Accrued legal			1,564						1,484
Accrued regulatory expenses			1,252						331
Accrued other			959						1,428
Total accounts payable and accrued liabilities			$	53,409					$	53,993

			September 30, 2020						December 31, 2019
Machinery & equipment			$	4,683					$	5,635
Right of use, building lease			536						720
Computer equipment & software			259						437
Office furniture & equipment			174						174
Leasehold improvements			43						43
Idle equipment			679						679
Construction in progress			61						—
Total			6,435						7,688
Less accumulated depreciation and amortization			(4,950)						(5,613)
Total property and equipment, net			$	1,485					$	2,075

			September 30, 2020						Gross Carrying Value						Accumulated Amortization						Intangible Assets, net
			Product rights						$	6,050					$	(6,050)					$	—
			BELBUCA license and distribution rights						45,000						(16,875)						28,125
			Symproic license and distribution rights						30,636						(3,652)						26,984
			Total intangible assets						$	81,686					$	(26,577)					$	55,109

December 31, 2019						Gross Carrying Value						Accumulated Amortization						Intangible Assets, net
Product rights						$	6,050					$	(6,003)					$	47
BELBUCA license and distribution rights						45,000						(13,500)						31,500
Symproic license and distribution rights						30,636						(1,827)						28,809
Total intangible assets						$	81,686					$	(21,330)					$	60,356

			2020			—
			2021			—
			2022			18,462
			2023			24,615
			2024			24,615
			2025			12,308
			Total maturities			$	80,000
			Unamortized discount and loan costs			(1,637)
			Total notes payable obligation			$	78,363

			Three months ended September 30,												Nine months ended September 30,
			2020						2019						2020						2019
BELBUCA			$	34,758					$	26,514					$	100,572					$	69,277
% of net product sales			90		%				90		%				89		%				89		%
Symproic			3,453						2,172						11,046						5,348
% of net product sales			9		%				7		%				10		%				7		%
BUNAVAIL			574						937						1,328						2,813
% of net product sales			1		%				3		%				1		%				4		%
Net product sales			$	38,785					$	29,623					$	112,946					$	77,438

Expected price volatility			59.00%-61.76%
Risk-free interest rate			0.25%-1.68%
Weighted average expected life in years			6 years
Dividend yield			—

			Number of shares						Weighted average exercise price per share						Aggregate intrinsic value
Outstanding at January 1, 2020			5,496,971						$	3.64					$	15,455
Granted in 2020:
Officers and Directors			1,430,801						$	5.64
Employees			1,209,177						$	5.65
Exercised			(1,159,347)						$	2.38
Forfeitures			(365,188)						$	4.37
Outstanding at September 30, 2020			6,612,414						$	4.62					$	1,620

			Number of restricted shares						Weighted average fair market value per RSU
Outstanding at January 1, 2020			1,648,559						$	3.86
Granted in 2020:
Officers and Directors			289,949						$	5.17
Employees			12,455						$	5.50
Vested			(712,654)						$	2.72
Forfeitures			(407,217)						$	4.31
Outstanding at September 30, 2020			831,092						$	3.82

			Three months ended September 30,												Nine months ended September 30,
			2020						2019						2020						2019
Basic:
Net income (loss) attributable to common stockholders, basic			$	9,383					$	354					$	15,515					$	(14,609)
Weighted average common shares outstanding			101,031,317						89,649,922						99,377,748						81,612,112
Basic earnings (loss) per common share			$	0.09					$	—					$	0.16					$	(0.18)
Diluted:
Effect of dilutive securities:
Net income (loss) attributable to common stockholders, diluted			$	9,383					$	354					$	15,515					$	(14,609)
Weighted average common shares outstanding			101,031,317						89,649,922						99,377,748						81,612,112
Effect of dilutive options and warrants			4,752,251						15,488,972						5,458,745						—
Dilutive weighted average common shares outstanding			105,783,568						105,138,894						104,836,493						81,612,112
Diluted earnings (loss) per common share			$0.09						$—						$0.15						$(0.18)

On October 8, 2020, the Court entered an agreed-to order dismissing the plaintiffs’ claims for violation of the Delaware General Corporation Law. On October 13, 2020, plaintiffs filed an amended complaint, asserting individual, class and derivative claims for breach of fiduciary duties against our directors. On October 26, 2020, the Company and our directors filed a motion to dismiss the amended complaint. The Company intends to continue to defend against the litigation vigorously.

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

•strong and durable efficacy in both opioid naïve and opioid experienced patients;

•Schedule III designation by DEA, which indicates less abuse and addiction potential compared to Schedule II opioids, which include oxycodone, hydrocodone and morphine;

•in published studies, investigators observed that respiratory depression from buprenorphine administration reached a plateau, and we believe this ceiling effect may result in a lower risk of overdose death related to respiratory depression;

•favorable tolerability with a low incidence of constipation and low discontinuation rate;

•flexible dosing options with seven available strengths; and

•buccal administration to optimize drug bioavailability.

•strong and durable efficacy observed in randomized, double-blind, placebo controlled clinical trials of 12-weeks and 52-weeks duration in OIC patients;

•OIC relief that was more frequent, more complete, and with less straining than patients taking placebo;

•recommended by the American Gastroenterological Association for patients with laxative refractory OIC;

•adverse event profile comparable to placebo, with low rates of abdominal pain observed across the Phase III program; and

•the only prescription OIC medication with the convenience of once-daily dosing, with only one tablet strength, and that can be taken with or without food and with or without laxatives.

Product Sales. We recognized $38.8 million and $29.6 million in product sales during the three months ended September 30, 2020 and 2019, respectively. The increase in 2020 is principally due to BELBUCA and Symproic product sales which have been driven by increased paid prescriptions from the utilization of managed care wins, along with growth in the Medicare channel, and offset by lower BUNAVAIL product sales resulting from our discontinuation of marketing activities. While BELBUCA gross to net deductions did increase in the third quarter as anticipated, based primarily on typical increases seen for coverage gap along with increased Medicaid costs, those increases were favorably impacted by updates to our channel estimates reflected in the third quarter of 2020. BUNAVAIL net revenue in the quarter reflects the release of a portion of the returns reserves taken at the time discontinuation was announced.

Product Royalty Revenues. We recognized $0.7 million in product royalty revenue during each of the three months ended September 30, 2020 and 2019, respectively, related to PAINKYL royalty revenue under our license agreement with TTY.

Cost of Sales. We incurred $5.4 million in cost of sales during each of the three months ended September 30, 2020 and 2019, respectively. Cost of sales includes product cost, royalties paid, depreciation, yield adjustments and quarterly minimum royalty payments to CDC IV, LLC (“CDC”).

Selling, General and Administrative Expenses. During the three months ended September 30, 2020 and 2019, selling, general and administrative expenses totaled $22.5 million and $23.4 million, respectively. Selling, general and administrative costs include all costs not related to the manufacturing of product. The decrease in selling, general and administrative expenses during the three months ended September 30, 2020 as compared to the same period in the prior year is primarily due to lower spend associated with cost management measures that have been put in place in response to Covid-19, particularly over select marketing programs. In addition, we have continued to see a reduction in travel expenses due to elimination of live presence at conferences and restrictions in visiting doctor's offices.

Interest expense, net . During the three months ended September 30, 2020, we had net interest expense of $2.0 million, which consisted of $1.9 million of scheduled interest payments, and $0.1 million of amortization of discount and loan costs.

Product Sales. We recognized $112.9 million and $77.4 million in product sales during the nine months ended September 30, 2020 and 2019, respectively. The increase in 2020 is principally due to increased BELBUCA and Symproic product sales from higher patient utilization, the impact of managed care wins, the impact of our price increase on January 1, 2020, and the full period impact of Symproic, partially offset by lower BUNAVAIL product sales.

Product Royalty Revenues. During the nine months ended September 30, 2020 and 2019, we recognized $1.4 million and $2.2 million in PAINKYL and BREAKYL product royalty revenue under our license agreements with TTY and Mylan, respectively. Product royalty revenue related to PAINKYL and BREAKYL is primarily via government demand in the Ex-U.S. countries where the products are sold by TTY and Mylan, respectively.

Contract Revenues. We recognized $0.2 million in contract revenues during the nine months ended September 30, 2019 related to our license agreements TTY. There were no such contract revenues during the same period of 2020.

Cost of Sales. We incurred $16.4 million and $14.3 million in cost of sales during the nine months ended September 30, 2020 and 2019, respectively. Cost of sales includes product cost, royalties paid, depreciation, yield adjustments and quarterly minimum royalty payments to CDC. Cost of sales for the nine months ended September 30, 2020 includes a $0.3 million one-time depreciation charge due to BUNAVAIL equipment write-off.

Selling, General and Administrative Expenses. During the nine months ended September 30, 2020 and 2019, selling, general and administrative expenses totaled $77.4 million and $62.3 million, respectively. Selling, general and administrative

•EBITDA excludes depreciation and amortization and, although these are non-cash expenses, the assets being depreciated or amortized may have to be replaced in the future, the cash requirements for which are not reflected in EBITDA;

•EBITDA does not reflect provision for (benefit from) income taxes or the cash requirements to pay taxes; and

•EBITDA excludes net interest, including both interest expense and interest income.

•The expenses and other items that we exclude in our calculation of non-GAAP net income/(loss) may differ from the expenses and other items, if any, that other companies may exclude from non-GAAP net income/(loss) when they report their operating results since non-GAAP income/(loss) is not a measure determined in accordance with GAAP, and it has no standardized meaning prescribed by GAAP;

•We exclude stock-based compensation expense from non-GAAP net income/(loss) although (a) it has been, and will likely continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy and (b) if we did not pay out a portion of our compensation in the form of stock-based compensation, the cash salary expense included in operating expenses would likely be higher, which would affect our cash position;

•We exclude amortization of intangible assets from non-GAAP net income/(loss) due to the non-cash nature of this expense and although it has been and will continue to be for the foreseeable future a recurring expense for our business, these expenses do not affect our cash position; and

•We exclude the financial impact of debt refinancing, the CEO termination costs and the BUNAVAIL equipment write-off, because they are each non-recurring in nature.

			Three Months Ended September 30,									Nine Months Ended September 30,
Reconciliation of GAAP net income/(loss) to EBITDA (non-GAAP)			2020			2019						2020			2019
GAAP net income/(loss)			$	9,383		$	354					$	15,515		$	(14,609)
Add back/(subtract):
Income tax provision			211			4						19			4
Net interest expense			2,012			1,237						4,991			17,727
Depreciation and amortization			1,754			1,904						5,715			5,259
EBITDA			$	13,360		$	3,499					$	26,240		$	8,381
Reconciliation of GAAP net income/(loss) to Non-GAAP net income/(loss)
GAAP net income/(loss)			$	9,383		$	354					$	15,515		$	(14,609)
Non-GAAP adjustments:
Stock-based compensation expense			1,473			1,267						4,424			3,978
Amortization of intangible assets			1,734			1,898						5,248			5,084
Amortization of warrant discount			—			—						—			448
Non-recurring financial impact of debt refinance			—			—						—			11,866
Non-recurring financial impact of CEO transition			67			—						5,078			—
Non-recurring financial impact of BUNAVAIL discontinuation			—			—						295			—
Non-GAAP net income/(loss)			$	12,657		$	3,519					$	30,560		$	6,767

•public equity markets;

•private equity financings;

•commercialization agreements and collaborative arrangements;

•sale of product royalty;

•grants and new license revenues;

•bank loans;

•equipment financing;

•public or private debt; and

•exercise of existing warrants and options.

			Payments Due by Period
			Total			Less than 1 year			1-3 years			3-5 years			More than 5 years
Lease obligations			$	681		$	368		$	313		$	—		$	—
Secured loan facility			80,000			—			36,923			43,077			—
Interest on secured loan facility			25,049			7,706			13,186			4,157			—
Minimum royalty expenses*			10,125			1,500			3,000			3,000			2,625
Purchase obligations**			958			804			154			—			—
Total contractual cash obligations			$	116,813		$	10,378		$	53,576		$	50,234		$	2,625

*    Minimum royalty expenses represent a contractual floor that we are obligated to pay CDC and NB Athyrium LLC regardless of actual sales. The minimum payment is $0.4 million per quarter or $1.5 million per year until patent expiry on July 23, 2027.

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Item 4.    Controls and Procedures

Item 1.    Legal Proceedings.

Item 1A.    Risk Factors.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.

Item 3.    Defaults upon Senior Securities.

Item 4.    Mine Safety Disclosures.

Item 5.    Other Information.

Item 6.    Exhibits.

Number						Description
31.1						Certification of Principal Executive Officer Pursuant To Sarbanes-Oxley Section 302. *
31.2						Certification of Principal Financial Officer Pursuant To Sarbanes-Oxley Section 302. *
32.1						Certification Pursuant To 18 U.S.C. Section 1350. #
32.2						Certification Pursuant To 18 U.S.C. Section 1350. #
101.ins						XBRL Instance Document.
101.sch						XBRL Taxonomy Extension Schema Document.
101.cal						XBRL Taxonomy Calculation Linkbase Document.
101.def						XBRL Taxonomy Definition Linkbase Document.
101.lab						XBRL Taxonomy Label Linkbase Document.
101.pre						XBRL Taxonomy Presentation Linkbase Document.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document contained in Exhibit 101).*

			BIODELIVERY SCIENCES INTERNATIONAL, INC.
Date: November 5, 2020			By:			/s/ Jeffrey Bailey
						Jeffrey Bailey
						Director and Chief Executive Officer
						(Principal Executive Officer)
Date: November 5, 2020			By:			/s/ Mary Theresa Coelho
						Mary Theresa Coelho
						Treasurer and Chief Financial Officer
						(Principal Financial and Accounting Officer)