Item 1A. Risk Factors 13
Item 1B. Unresolved Staff Comments 28
Item 2. Properties 28
Item 3. Legal Proceedings 28
Item 4. Mine Safety Disclosures 28
PART II
Item 6. [Reserved] 29
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 33
Item 8. Financial Statements and Supplementary Data 33
Item 9A Controls and Procedures 34
Item 9B. Other Information 34
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 34
PART III
Item 10. Directors, Executive Officers and Corporate Governance 35
Item 11. Executive Compensation 43
Item 14. Principal Accountant Fees and Services 51
PART IV
Item 15. Exhibits and Financial Statement Schedules 53
Item 16. Form 10-K Summary
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BIOVIE INC.
FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements within the meaning of Section
21E of the Securities Exchange Act of 1934, and Section 27A of the Securities Act of 1933. Any statements contained in this report that
are not statements of historical fact may be forward-looking statements. When we use the words “intends,” “estimates,”
“predicts,” “potential,” “continues,” “anticipates,” “plans,” “expects,”
“believes,” “should,” “could,” “may,” “will” or the negative of these terms
or other comparable terminology, we are identifying forward-looking statements. Forward-looking statements involve risks and uncertainties,
which may cause our actual results, performance or achievements to be materially different from those expressed or implied by forward-looking
statements. These factors include our research and development activities, distributor channel; compliance with regulatory impositions;
and our capital needs. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot
guarantee future results, levels of activity, performance or achievements.
Except as may be required by applicable law, we do not undertake or intend
to update or revise our forward-looking statements, and we assume no obligation to update any forward-looking statements contained in
this report as a result of new information or future events or developments. Thus, you should not assume that our silence over time means
that actual events are bearing out as expressed or implied in such forward-looking statements. You should carefully review and consider
the various disclosures we make in this report and our other reports filed with the Securities and Exchange Commission that attempt to
advise interested parties of the risks, uncertainties and other factors that may affect our business.
All statements other than statements of historical fact are statements
that could be deemed forward-looking statements. The Company assumes no obligation and does not intend to update these forward-looking
statements, except as required by law. When used in this report, the terms “BioVie”, “Company”, “we”,
“our”, and “us” refer to BioVie, Inc.
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PART I
ITEM 1. BUSINESS
BioVie Inc. is a clinical-stage company developing innovative drug therapies
to overcome unmet medical needs in chronic debilitating conditions.
In liver disease, our Orphan Drug candidate BIV201 (continuous
infusion terlipressin) is being developed as a future treatment option for patients suffering from ascites and other life-threatening
complications of advanced liver cirrhosis caused by NASH, hepatitis, and alcoholism. The initial target for BIV201 therapy is refractory
ascites. These patients suffer from frequent life-threatening complications, generate
more than $5 billion in annual treatment costs, and have an estimated 50% mortality rate within 6 to 12 months. The US Food and Drug Administration
(FDA) has not approved any drug to treat refractory ascites. A Phase 2a clinical trial of BIV201 was completed in 2019, and a multi-center,
randomized 30-patient Phase 2b trial is currently underway. As of June 30, 2022, eleven US study centers had been activated and are actively
screening and enrolling patients in the study. Top-line results from this trial are expected in mid calendar year 2023.
The BIV201 development program was initiated by LAT Pharma LLC. On April
11, 2016, the Company acquired LAT Pharma LLC and the rights to its BIV201 development program. The Company currently owns all development
and marketing rights to its drug candidate. Pursuant to the Agreement and Plan of Merger entered into on April 11, 2016, between our predecessor
entities, LAT Pharma LLC and NanoAntibiotics, Inc., BioVie is obligated to pay a low single digit royalty on net sales of BIV201 (continuous
infusion terlipressin) to be shared among LAT Pharma Members, PharmaIn Corporation, and The Barrett Edge, Inc.
In neurodegenerative disease, BioVie acquired the biopharmaceutical
assets of NeurMedix, Inc., a related party privately held clinical-stage pharmaceutical company and related party affiliate, in June 2021.
The acquired assets include NE3107, a potentially selective inhibitor of inflammatory ERK signaling that, based on animal studies, is
believed to reduce neuroinflammation. NE3107is a novel orally administered small molecule that is thought to inhibit inflammation-driven
insulin resistance and major pathological inflammatory cascades with a novel mechanism of action. There is emerging scientific consensus
that both inflammation and insulin resistance may play fundamental roles in the development of Alzheimer’s and Parkinson’s
Disease, and NE3107 could, if approved, represent an entirely new medical approach to treating these devastating conditions affecting
an estimated 6 million Americans suffering from Alzheimer’s and 1 million from Parkinson’s. The FDA has authorized a potentially
pivotal Phase 3 randomized, double-blind, placebo-controlled, parallel group, multicenter study to evaluate NE3107 in subjects who have
mild to moderate Alzheimer’s disease (NCT04669028). We initiated this trial on August 5, 2021 and are targeting primary completion
in mid calendar year 2023.
On January 20, 2022, the Company initiated a study by treating the first patient, in its Phase 2 study assessing
NE3107’s safety and tolerability and potential pro-motoric impact in Parkinson’s disease patients. The NM201 study (NCT05083260)
is a double-blind, placebo-controlled, safety, tolerability, and pharmacokinetics study in Parkinson’s Disease (PD). Participants
will be treated with carbidopa/levodopa and NE3107 or placebo. Forty patients with a defined PD medication “off state” will
be randomized 1:1 placebo to active NE3107 20 mg twice daily for 28 days. Safety assessments will look at standard measures of patient
health and potential for drug-drug interactions affecting L-dopa pharmacokinetics and activity. Exploratory efficacy assessments will
use the Motor Disease Society Unified Parkinson’s Disease Rating (MDS-UPDRS) parts 1-3, ON/OFF Diary, and Non-Motor Symptom Scale.
Topline results are expected for the NM201 study by the end of the calendar year 2022.
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Investigator-Initiated Trial in MCI and Mild Alzheimer’s Disease,
NCT05227820
The Company provided the financial support and the use of our NE3107
formulated drug product to The Regenesis Project of Dr Sheldon Jordan in an open-label phase 2 study in Dr. Sheldon’s patients
with Alzheimer’s disease related dementias. The study received FDA authorization on December 12, 2021and was designed to measure
NE3107’s effect on cognition, cerebral spinal fluid (“CSF”) and blood biomarkers, and neuro-imagining endpoints. The
study seeks to measure changes in cognition through verbal and visual test procedures and changes in biomarkers of Alzheimer's disease
and inflammatory and metabolic parameters that can be measured in the central nervous system with advanced neuroimaging techniques in
patients before and after treatment with 20 mg of NE3107 twice daily for 3 months following three months of treatment. Data analysis for the study is expected to be in completed in second half
of the calendar year 2022.
Inflammation-driven insulin resistance is believed to be implicated
in a broad range of serious diseases, including multiple myeloma and prostate cancer, and we plan to begin exploring these opportunities
in the coming months using NE3107 or related compounds acquired in the NeurMedix asset purchase. NE3107 is patented in the United States,
Australia, Canada, Europe and South Korea.
Liver Cirrhosis Program
BioVie’s orphan drug candidate BIV201 (continuous infusion terlipressin)
represents a novel approach to the treatment of ascites due to chronic liver cirrhosis. BIV201 is based on a drug that is approved in
about 40 countries to treat related complications of liver cirrhosis (part of the same disease pathway as ascites), but not yet available
in the United States. The active agent in BIV201, terlipressin, is a potent vasoconstrictor and is marketed in multiple foreign countries.
The goal of BIV201 therapy is to interrupt the ascites disease pathway, thereby halting the cycle of accelerated fluid generation in ascites
patients.
In 2017, we began administering BIV201 to patients at the McGuire Research
Institute Inc. in Richmond, VA. In April 2019, we announced top-line results for our Phase 2a clinical trial of BIV201 (continuous infusion
terlipressin) in six patients with refractory ascites due to advanced liver cirrhosis. The following results were observed:
In June 2019, we met with representatives of the FDA for a Type C Guidance
Meeting to plan our next clinical study in ascites. We discussed our clinical development program with the FDA and proposed safety and
efficacy endpoints required for future marketing approval. In September 2019, the FDA granted our Type B meeting request and committed
to providing feedback in early 2020 for our proposed clinical trial design. In April 2020, we received the FDA’s written response
to our Type B meeting questions which required changes to our clinical trial design. Subsequently we received further guidance from the
FDA. Based on this guidance, the Company finalized the clinical trial protocol and prepared for a randomized 30-patient Phase 2b study.
The IND for this study was submitted and has become effective. The Phase 2b study was initiated in June 2021. As of July 2022, eleven
planned US study centers have been activated. We plan to follow this study with a larger potentially pivotal Phase 3 clinical trial expected
to begin in 2023. The FDA communicated that pending positive Phase 2 study results, a sufficiently large and well-controlled Phase 3 trial,
with supportive trend data from the Phase 2b (statistical significance not required), could potentially yield the clinical data needed
to apply for BIV201 marketing approval. The Phase 2b clinical trial protocol is summarized on www.clinicaltrials.gov, trial identifier
NCT04112199.
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We have invented a proprietary novel liquid formulation of terlipressin
which is currently being studied in the above clinical studies intended to improve convenience for outpatient administration and avoid
potential formulation errors when pharmacists reconstitute the powder version. In May 2020, we received CMC division clearance to use
the new BIV201 prefilled terlipressin syringe in the current Phase 2b trial subject to conducting certain additional standard analytical
testing which has been successfully completed. To date analytical testing results have confirmed room temperature stability of the prefilled
syringe in storage for 18 months, with the potential for up two years stability. Room temperature storage presents a key product differentiation
versus terlipressin products in countries where the drug is approved. To the best of the Company’s knowledge, all other terlipressin
products sold globally must be stored under refrigeration and there is no prefilled syringe format of terlipressin available for treating
patients in these countries. BioVie has also filed a Patent Cooperation Treaty (“PCT”) application covering our novel liquid
formulations of terlipressin (international patent application PCT/US2020/034269, published as WO2020/237170) and we plan to seek patent
protection in at least the United States, Europe, China and Japan.
BIV201 (continuous infusion terlipressin) has the potential to improve
the health of thousands of patients suffering from life-threatening complications of liver cirrhosis due to hepatitis, NASH, and alcoholism.
The FDA has granted Fast-Track status and Orphan Drug designation for the most common of these complications, ascites, which represents
a significant unmet medical need. Patients with cirrhosis and ascites account for an estimated 116,000 U.S. hospital discharges annually,
with frequent early readmissions. Those requiring paracentesis (removal of ascites fluid) experience an average hospital stay lasting
8 days incurring over $86,000 in medical costs (HCUP Nationwide Readmissions Database 2016). This translates into a total addressable
ascites market size for BIV201 therapy exceeding $650 million based on Company estimates. The FDA has never approved any drug specifically
for treating ascites. For patients with refractory ascites the mean one-year survival rate is only 50% (Bureau et al. 2017). BIV201
has also received Orphan Drug designation for hepatorenal syndrome (“HRS”). Patients with refractory ascites often progress
to HRS which is the onset of kidney failure and requires emergency hospitalization. About one-half of these patients typically succumb
within only 2 to 4 weeks and no drug therapies have been FDA approved specifically to treat HRS.
The BIV201 development program began at LAT Pharma LLC. On April 11, 2016,
we acquired LAT Pharma LLC and the rights to its BIV201 development program and currently own all development and marketing rights to
the product candidate. We and PharmaIN, LAT Pharma’s former partner focused on the development of new modified product candidates
in the same therapeutic field but not including BIV201, have agreed to pay royalties equal to less than 1% of future net sales of each
company’s ascites drug development programs, or if such program is licensed to a third party, less than 5% of each company’s
net license revenues. On December 24, 2018, we returned our partial ownership rights to the PharmaIN modified terlipressin development
program and simultaneously paid the remaining balance due on a related debt. PharmaIN’s rights to our program remain unchanged.
Our pending U.S patent (a continuation application related to the ’945 Patent) for the use of BIV201 as a monotherapy for the treatment
of patients diagnosed with ascites due to liver cirrhosis in the outpatient setting using ambulatory pump infusion, issued on June 21,
2022 (U.S 11,364,277). Corresponding patent applications are pending in Japan, Europe, China and Hong Kong.
About Ascites and Liver Cirrhosis
Cirrhosis is a leading cause of death in the US. The condition results
primarily from hepatitis, alcoholism, and fatty liver disease linked to obesity. Ascites is a common complication of advanced liver cirrhosis,
involving kidney dysfunction and the accumulation of large amounts of fluid in the abdominal cavity.
The Need for an Ascites Therapy
With no medications approved by the FDA specifically for treating ascites,
an estimated 40% of patients die within two years of diagnosis. Certain drugs approved for other uses such as diuretics may provide initial
relief, but patients may fail to respond to treatment as ascites worsens. This represents a critical unmet medical need. U.S. treatment
costs for liver cirrhosis, including ascites and other complications, are estimated at more than $5 billion annually.
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The Ascites Development Pathway
Most experts agree that ascites develops through a sequence of events illustrated
by the above diagram. High blood pressure in the vein that supplies blood to the liver, called “portal hypertension,” occurs
as increasing liver damage (fibrosis) impedes blood flow through the liver. This causes vasodilation and blood pooling in the central
or “splanchnic” region of the body and low blood volume in the arteries. The decrease in effective blood volume activates
a signaling pathway (“neurohormonal systems”) which tells the kidneys to retain large amounts of salt and water in an effort
to increase blood volume. Ultimately the retention of excess sodium and water leads to the formation of ascites as these substances “weep”
from the liver and lymph system and collect in the patient’s abdomen.
The BIV201 Mechanism of Action
BIV201 is being developed with the goal of alleviating the portal hypertension
and correcting splanchnic vasodilation, thereby increasing effective blood volume and reducing the signals to the kidneys to
retain excess salt and water. If successful, BIV201 could halt the cycle of accelerating fluid generation in ascites patients and reduce
the need for the frequent and painful paracentesis procedures many of these patients currently require.
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Future Possible BIV201 Indications
Based on international investigative studies of the active agent in BIV201,
terlipressin, our new drug candidate has potential future applications in other life-threatening conditions due to liver cirrhosis, such
as those listed below. Securing marketing approvals for any of these new uses will require well-controlled clinical trials to satisfy
the FDA and/or other countries’ regulatory requirements, none of which have commenced at this time. The Company may be unable to,
or chose not to, pursue the development BIV201 for these indications.
Neurodegenerative Disease Program
BioVie acquired the biopharmaceutical assets of NeurMedix, Inc., a privately
held clinical-stage pharmaceutical company and related party affiliate, in June 2021. The acquired assets include NE3107, a potentially
selective inhibitor of inflammatory ERK signaling that, based on animal studies, is believed to reduce neuroinflammation. NE3107 is a
novel orally administered small molecule that is thought to inhibit inflammation-driven insulin resistance and major pathological inflammatory
cascades with a novel mechanism of action. There is emerging scientific consensus that both inflammation and insulin resistance may play
fundamental roles in the development of Alzheimer’s and Parkinson’s Disease, and NE3107 could, if approved, represent an entirely
new medical approach to treating these devastating conditions affecting an estimated 6 million Americans suffering from Alzheimer’s
and 1 million from Parkinson’s. The FDA has authorized a potentially pivotal Phase 3 randomized, double-blind, placebo-controlled,
parallel group, multicenter study to evaluate NE3107 in subjects who have mild to moderate Alzheimer’s disease (NCT04669028). We
initiated this trial on August 5, 2021 and are targeting primary completion in mid calendar year of 2023.
Alzheimer’s Disease
Alzheimer’s disease (AD), which affects an estimated 6 million Americans,
is a neuroinflammatory and neurodegenerative condition characterized by progressive deterioration of cognitive function and loss of short-term
memory and executive function. Cognitive tests quantifying AD severity have been exhaustively developed. Formal diagnosis of AD has historically
been dependent on the presence of extraneuronal amyloid beta (Aβ) plaques,
which can only be observed at autopsy or with the aid of sophisticated radioimaging techniques. However, diagnostic methods have recently
been approved that quantify Aβ in peripheral blood and correlate well with
imaging results. Aβ plaques can also be found in people without apparent
AD symptoms, which has cast doubt about the role of Aβ as the central mediator
of disease pathology.
Scientific investigations in the past twenty years have provided strong
evidence that inflammation, type 2 diabetes (T2D), and inflammation-driven insulin resistance (IR) are drivers of AD. The link between
these factors and cognitive impairment are described by relatively new terms, type 3 diabetes and metabolic-cognitive syndrome.
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A large body of evidence supports inflammation as a primary driver of pathology
in AD. The major inflammation signaling node, NFkB, and the cytokine tumor necrosis factor (TNF) are important initiators of inflammatory
signaling in AD pathology. NE3107 is believed to inhibit extracellular signal regulated kinase (ERK)/NFkB activation and TNF production
stimulated by inflammatory mediators, such as lipopolysaccharide. Inhibition of NFkB activation and TNF production from this type of stimulation
has broad potential implications for reduction of pathological peripheral and central nervous system (CNS) inflammatory signaling in AD,
which include reduction of inflammation-driven insulin resistance, decreased inflammatory cell infiltration into the CNS, and decreased
microglia activation. Reduction of systemic inflammation and inflammation driven insulin resistance are also predicted to have beneficial
effects on hypothalamus-pituitary-adrenal (HPA) axis dysregulation and hippocampal dysregulation of cortisol secretion that are consequences
of adipose inflammation and insulin resistance, and known to promote cognitive impairment, and are also forward-feeding for insulin resistance.
Inflammation, insulin resistance, and associated metabolic
dysregulation in the brain contribute to Aβ oligomerization and aggregation,
phospho-tau formation, reduced neuron survival stimulus, and a forward-feeding cycle of neuronal energy deficit and oxidative stress,
causing neuronal dysfunction (cognitive impairment) and neurodegeneration. NE3107’s combination of anti-inflammatory and insulin
sensitizing activity has the potential to disrupt this forward-feeding cycle of AD pathology.
Insulin has a major role in metabolic regulation and neuron survival, while
insulin resistance and T2D are closely linked to AD pathology. Insulin signaling is involved in synaptic plasticity, learning, and memory.
Exogenous insulin enhances cognition in normal and cognitively impaired subjects. Insulin resistance is linked to cognitive impairment.
The multifactorial influence of insulin signaling on neuron survival and
cognition suggests that correction of insulin signaling deficits with NE3107 in the target population may provide significant benefits
on both cognition and disease progression. Additional rationale for targeting metabolic dysregulation with NE3107 has come from recent
work showing peripheral insulin resistance promotes insulin resistance and senescence in the CNS.
There is also an extensive literature on the complex role of adipose tissue
inflammation in systemic inflammation, insulin resistance, hypothalamus-pituitary-adrenal axis (HPA) dysregulation and chronic cortisol
excess in cognitive impairment in AD. Obesity and inflammation are closely linked in expanding adipose tissue, where the production of
inflammatory cytokines and increased cortisol are driven though up-regulation of 11β-hydroxysteroid
dehydrogenase type 1 and adipocyte mineralocorticoid receptor activation. Inflamed adipose tissue interacts with the HPA axis and hippocampus
to increase systemic cortisol, and promote hippocampal inflammation through chronically elevated cortisol, which freely penetrates the
blood-brain barrier. Hyperglycemia (secondary to insulin resistance) exacerbates adrenal cortisol production and promotes forward feeding
of inflammation and HPA-hippocampal dysregulation.
Systemic inflammation from inflamed adipose and associated mononuclear
cells, promotes CNS inflammation with associated cognitive decline and neurodegeneration. NE3107’s anti-inflammatory activity against
systemic/adipose inflammation and factors that dysregulate cortisol secretion, such as hyperglycemia, has the potential to decrease cognitive
impairment and neurodegenerative mechanisms that have been linked to cortisol excess.
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Parkinson’s Disease
The Company initiated a study by treating the first patient, in its Phase
2 study assessing NE3107’s safety and tolerability and potential pro-motoric impact in Parkinson’s disease patients on January
20, 2022. The NM201 study (NCT05083260) is a double-blind, placebo-controlled, safety, tolerability, and pharmacokinetics study in Parkinson’s
Disease (PD). Participants will be treated with carbidopa/levodopa and NE3107 or placebo. Forty patients with a defined PD medication “off state” will
be randomized 1:1 placebo to active NE3107 20 mg twice daily for 28 days. Safety assessments will look at standard measures of patient
health and potential for drug-drug interactions affecting L-dopa pharmacokinetics and activity. Exploratory efficacy assessments will
use the Motor Disease Society Unified Parkinson’s Disease Rating (MDS-UPDRS) parts 1-3, ON/OFF Diary, and Non-Motor Symptom Scale.
Neuroinflammation and activation of brain microglia, leading to increased
proinflammatory cytokines (particularly TNF) which play a pivotal role in Parkinson’s Disease (PD), which affects an estimated 1
million Americans. Daily administration of levodopa (converted to dopamine in the brain) is the current standard of care treatment for
this movement disorder, but prolonged daily administration leads to side effects of uncontrolled movements called levodopa-induced dyskinesia,
commonly referred to as LID. Recent evidence demonstrates that daily administration of levodopa further increases neuroinflammation, microglia
activation, and TNF inflammatory damage in neurons.
We have shown in a mouse model that PD NE3107 decreases inflammation and
TNF in the brain and increases neuron survival (Nicoletti, 2012 Parkinson’s Disease 969418.) In this neurotoxin induced model, NE3107
decreased clinical signs of disease and neuronal death compared to placebo treated mice.
An unpublished study in a neurotoxin induced marmoset model of Parkinson’s
disease reported that administration of NE3107 decreased movement abnormalities that are the clinical signs of the disease. In the same
study, NE3107 in combination with levodopa had a stronger effect on clinical signs of disease than levodopa or NE3107 alone, while marmosets
treated with NE3107 developed less LID. NE3107-treated monkeys also exhibited neuroprotective activity that promoted the survival of twice
as many neurons in the substantia nigra (primary region of the brain that degenerates to cause parkinsonism) as monkeys treated with placebo.
The results from the marmoset study suggest that NE3107 may decrease clinical signs of disease in humans (improve motor function), which
if true could enable a straightforward clinical development strategy to test NE3107 in PD patients needing promotoric therapy.
If approved as a promotoric agent, NE3107 would provide a non-dopaminergic
alternative to Parkinson’s patients, and an opportunity to significantly delay the need to start levodopa therapy. This could represent
a first step toward supplanting levodopa as the primary PD therapy, and in addition to delaying the emergence of LID, could also imply
a slowing of disease progression, the most important and still unmet objective of PD drug development.
Intellectual Property
BioVie relies on a combination of patent, trade secret, other intellectual
property laws (such as FDA data exclusivity), nondisclosure agreements, and other measures to protect our proposed products. We require
our employees, consultants, and advisors to execute confidentiality agreements and to agree to disclose and assign to us all inventions
conceived during the workday, using our property, or which relate to our business. Despite any measures taken to protect our intellectual
property (IP), unauthorized parties may attempt to copy aspects of our products or to obtain and use information that we regard as proprietary.
BIV201 was awarded Orphan Drug Designations in the U.S. for the treatment
of hepatorenal syndrome (received November 21, 2018) and treatment of ascites due to all etiologies except cancer (received September
8, 2016). We also filed a PCT application covering our novel liquid formulations of terlipressin (international patent application PCT/US2020/034269,
published as WO2020/237170) and are seeking patent protection in at least the United States, Europe, China, Japan and other jurisdictions.
Also, we own U.S. Patent 11,364,277, which is directed to a method of treating ascites with BIV201, and we are pursuing similar patent
coverage in Japan, Europe, and China.
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As of August 22, 2022, we have fifteen (15) issued U.S. patents, one (1)
pending U.S. patent application, one (1) pending U.S. PCT application and six (6) issued foreign patents directed to protecting NE3107
and related compounds and methods of making and using thereof. The U.S. patents and pending patent applications and their projected expiration
dates are provided below.
Title Patent Application Number Patent Number Expiration Date
** Foreign counterparts issued in Europe and Japan expire 6/5/2029.
Government Regulation
Government authorities in the United States, at the federal, state and
local level, and in other countries extensively regulate, among other things, the research, development, testing, manufacture, quality
control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting,
marketing and export and import of products such as those we are developing. Any pharmaceutical candidate that we develop must be approved
by the FDA before it may be legally marketed in the United States and by the appropriate foreign regulatory agency before it may be legally
marketed in foreign countries.
United States Drug Development Process
In the United States, the FDA regulates drugs under the Federal Food, Drug
and Cosmetic Act, or FDCA, and implements regulations. Drugs are also subject to other federal, state and local statutes and regulations.
Biologics are subject to regulation by the FDA under the FDCA, the Public Health Service Act, or the PHSA, and related regulations, and
other federal, state and local statutes and regulations. Biological products include, among other things, viruses, therapeutic serums,
vaccines and most protein products. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal,
state, local and foreign statutes and regulations require the expenditure of substantial time and financial resources. Failure to comply
with the applicable United States requirements at any time during the product development process, approval process or after approval,
may subject an applicant to administrative or judicial sanctions. FDA sanctions could include refusal to approve pending applications,
withdrawal of an approval, a clinical hold, warning letters, product recalls, product seizures, total or partial suspension of production
or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties. Any agency
or judicial enforcement action could have a material adverse effect on us.
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The process required by the FDA before a drug or biological product may
be marketed in the United States generally involves the following:
● FDA review and approval of the NDA or BLA.
The lengthy process of seeking required approvals and the continuing need
for compliance with applicable statutes and regulations require the expenditure of substantial resources. There can be no certainty that
approvals will be granted.
Clinical trials involve the administration of the drug or biological candidate
to healthy volunteers or patients having the disease being studied under the supervision of qualified investigators, generally physicians
not employed by or under the trial sponsor’s control. Clinical trials are conducted under protocols detailing, among other things,
the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor
subject safety. Each protocol must be submitted to the FDA as part of the IND. Clinical trials must be conducted in accordance with the
FDA’s good clinical practices requirements. Further, each clinical trial must be reviewed and approved by an independent institutional
review board, or IRB, at or servicing each institution at which the clinical trial will be conducted. An IRB is charged with protecting
the welfare and rights of trial participants and considers such items as whether the risks to individuals participating in the clinical
trials are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the informed consent form that must
be provided to each clinical trial subject or his or her legal representative and must monitor the clinical trial until it is completed.
Human clinical trials prior to approval are typically conducted in three
sequential phases that may overlap or be combined:
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Post-approval studies, or Phase 4 clinical trials, may be conducted
after initial marketing approval. These studies are used to gain additional experience from the treatment of patients in the intended
therapeutic indication and may be required by the FDA as part of the approval process.
Progress reports detailing the results of the clinical trials must be submitted
at least annually to the FDA and written IND safety reports must be submitted to the FDA by the investigators for serious and unexpected
adverse events or any finding from tests in laboratory animals that suggests a significant risk for human subjects. Phase 1, Phase 2
and Phase 3 clinical trials may not be completed successfully within any specified period, if at all. The FDA or the sponsor or its
data safety monitoring board may suspend a clinical trial at any time on various grounds, including a finding that the research subjects
or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial
at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the drug or biologic
has been associated with unexpected serious harm to patients.
Concurrent with clinical trials, companies usually complete additional
animal studies and develop additional information about the chemistry and physical characteristics of the drug or biologic as well as
finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process
must be capable of consistently producing quality batches of the drug or biological candidate and, among other things, must include methods
for testing the identity, strength, quality and purity of the final drug or biologic. Additionally, appropriate packaging must be selected
and tested and stability studies must be conducted to demonstrate that the drug or biological candidate does not undergo unacceptable
deterioration over its shelf life.
U.S. Review and Approval Processes
The results of product development, preclinical studies and clinical trials,
along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug or biologic, proposed labeling
and other relevant information are submitted to the FDA as part of an NDA or BLA requesting approval to market the product. The submission
of an NDA or BLA is subject to the payment of substantial user fees; a waiver of such fees may be obtained under certain limited circumstances.
The FDA reviews all NDAs and BLAs submitted before it accepts them for
filing and may request additional information rather than accepting an NDA or BLA for filing. Once the submission is accepted for filing,
the FDA begins an in-depth review of the NDA or BLA.
After the NDA or BLA submission is accepted for filing, the FDA reviews
the NDA to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product
is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity. The FDA
reviews a BLA to determine, among other things, whether the product is safe, pure and potent and the facility in which it is manufactured,
processed, packaged or held meets standards designed to assure the product’s continued safety, purity and potency. In addition to
its own review, the FDA may refer applications for novel drug or biological products or drug or biological products which present difficult
questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation
and a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations
of an advisory committee, but it considers such recommendations carefully when making decisions. During the approval process, the FDA
also will determine whether a risk evaluation and mitigation strategy, or REMS, is necessary to assure the safe use of the drug or biologic.
If the FDA concludes that a REMS is needed, the sponsor of the NDA or BLA must submit a proposed REMS; the FDA will not approve the NDA
or BLA without a REMS, if required.
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Before approving an NDA or BLA, the FDA will inspect the facilities at
which the product is to be manufactured. The FDA will not approve the product unless it determines that the manufacturing processes and
facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.
Additionally, before approving an NDA or BLA, the FDA will typically inspect one or more clinical sites to assure compliance with cGMP.
If the FDA determines the application, manufacturing process or manufacturing facilities are not acceptable it will outline the deficiencies
in the submission and often will request additional testing or information.
The NDA or BLA review and approval process is lengthy and difficult and
the FDA may refuse to approve an NDA or BLA if the applicable regulatory criteria are not satisfied or may require additional clinical
data or other data and information. Even if such data and information is submitted, the FDA may ultimately decide that the NDA or BLA
does not satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive and may be susceptible to varying
interpretations, which could delay, limit or prevent regulatory approval. The FDA will issue a “complete response” letter
if the agency decides not to approve the NDA or BLA. The complete response letter usually describes all of the specific deficiencies in
the NDA or BLA identified by the FDA. The deficiencies identified may be minor, for example, requiring labeling changes, or major, for
example, requiring additional clinical trials. Additionally, the complete response letter may include recommended actions that the applicant
might take to place the application in a condition for approval. If a complete response letter is issued, the applicant may either resubmit
the NDA or BLA, addressing all of the deficiencies identified in the letter, or withdraw the application.
If a product receives regulatory approval, the approval may be limited
to specific diseases and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the
product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling. In
addition, the FDA may require Phase 4 testing which involves clinical trials designed to further assess a product’s safety
and effectiveness and may require testing and surveillance programs to monitor the safety of approved products that have been commercialized.
Orphan Drug Designation
Under the Orphan Drug Act, the FDA may grant orphan designation to a drug
or biological product intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than
200,000 individuals in the United States, or more than 200,000 individuals in the United States and for which there is no reasonable expectation
that the cost of developing and making a drug or biological product available in the United States for this type of disease or condition
will be recovered from sales of the product. Orphan product designation must be requested before submitting an NDA or BLA. After the FDA
grants orphan product designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA.
Orphan product designation does not convey any advantage in or shorten the duration of the regulatory review and approval process.
If a product that has Orphan designation subsequently receives the first
FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan product exclusivity, which
means that the FDA may not approve any other applications to market the same drug or biological product for the same indication for seven
years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan exclusivity. Competitors,
however, may receive approval of different products for the indication for which the Orphan product has exclusivity or obtain approval
for the same product but for a different indication for which the Orphan product has exclusivity. Orphan product exclusivity also could
block the approval of one of our products for seven years if a competitor obtains approval of the same drug or biological product as defined
by the FDA or if our drug or biological candidate is determined to be contained within the competitor’s product for the same indication
or disease. If a drug or biological product designated as an orphan product receives marketing approval for an indication broader than
what is designated, it may not be entitled to orphan product exclusivity. Orphan Drug status in the European Union has similar but not
identical benefits in the European Union.
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Expedited Development and Review Programs
The FDA has a Fast Track program that is intended to expedite or facilitate
the process for reviewing new drug and biological products that meet certain criteria. Specifically, new drug and biological products
are eligible for Fast Track designation if they are intended to treat a serious or life-threatening condition and demonstrate the potential
to address unmet medical needs for the condition. Fast Track designation applies to the combination of the product and the specific indication
for which it is being studied. Unique to a Fast Track product, the FDA may consider for review sections of the NDA or BLA on a rolling
basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA or
BLA, the FDA agrees to accept sections of the NDA or BLA and determines that the schedule is acceptable, and the sponsor pays any required
user fees upon submission of the first section of the NDA or BLA.
Any product submitted to the FDA for marketing approval, including those
submitted to a Fast Track program, may also be eligible for other types of FDA programs intended to expedite development and review, such
as priority review and accelerated approval. Any product is eligible for priority review if it has the potential to provide safe and effective
therapy where no satisfactory alternative therapy exists or a significant improvement in the treatment, diagnosis or prevention of a disease
compared with marketed products. The FDA will attempt to direct additional resources to the evaluation of an application for a new drug
or biological product designated for priority review in an effort to facilitate the review. Additionally, a product may be eligible for
accelerated approval. Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses
and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval, which means that they may be
approved on the basis of adequate and well-controlled clinical studies establishing that the product has an effect on a surrogate endpoint
that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint other than survival or irreversible
morbidity. As a condition of approval, the FDA generally requires that a sponsor of a drug or biological product receiving accelerated
approval perform adequate and well-controlled post-marketing clinical studies to establish safety and efficacy for the approved indication.
Failure to conduct such studies or conducting such studies that do not establish the required safety and efficacy may result in revocation
of the original approval. In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional
materials, which could adversely impact the timing of the commercial launch or subsequent marketing of the product. Fast Track designation,
priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process.
Post-Approval Requirements
Any drug or biological products for which we receive FDA approvals are
subject to continuing regulation by the FDA, including, among other things, record-keeping requirements, reporting of adverse experiences
with the product, providing the FDA with updated safety and efficacy information on an annual basis or as required more frequently for
specific events, product sampling and distribution requirements, complying with certain electronic records and signature requirements
and complying with FDA promotion and advertising requirements, which include, among others, standards for direct-to-consumer advertising,
prohibitions against promoting drugs and biologics for uses or in patient populations that are not described in the drug’s or biologic’s
approved labeling (known as “off-label use”), rules for conducting industry-sponsored scientific and educational activities,
and promotional activities involving the internet. Failure to comply with FDA requirements can have negative consequences, including the
immediate discontinuation of noncomplying materials, adverse publicity, enforcement letters from the FDA, mandated corrective advertising
or communications with doctors, and civil or criminal penalties. Although physicians may prescribe legally available drugs and biologics
for off-label uses, manufacturers may not market or promote such off-label uses.
We will need to rely, on third parties for the production of our product
candidates. Manufacturers of our product candidates are required to comply with applicable FDA manufacturing requirements contained in
the FDA’s cGMP regulations. cGMP regulations require among other things, quality control and quality assurance as well as the corresponding
maintenance of comprehensive records and documentation. Drug and biologic manufacturers and other entities involved in the manufacture
and distribution of approved drugs and biologics are also required to register their establishments and list any products made there with
the FDA and comply with related requirements in certain states, and are subject to periodic unannounced inspections by the FDA and certain
state agencies for compliance with cGMP and other laws. Accordingly, manufacturers must continue to expend time, money and effort in the
area of production and quality control to maintain cGMP compliance. Discovery of problems with a product after approval may result in
serious and extensive restrictions on a product, manufacturer, or holder of an approved NDA or BLA, including suspension of a product
until the FDA is assured that quality standards can be met, continuing oversight of manufacturing by the FDA under a “consent decree,”
which frequently includes the imposition of costs and continuing inspections over a period of many years, and possible withdrawal of the
product from the market. In addition, changes to the manufacturing process generally require prior FDA approval before being implemented
and other types of changes to the approved product, such as adding new indications and additional labeling claims, are also subject to
further FDA review and approval.
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The FDA also may require post-marketing testing, known as Phase 4
testing, risk minimization action plans and surveillance to monitor the effects of an approved product or place conditions on an approval
that could otherwise restrict the distribution or use of the product.
Employees
Our business is managed by our officers who consist of Mr. Cuong Do, Chief
Executive Officer & President; Dr Joseph M Columbo, Chief Medical Officer, who joined the Company on November 1, 2021; and Wendy Kim,
our Chief Financial Officer and Corporate Secretary; along with Penelope Markham, PhD, Executive Vice President - Liver Cirrhosis R&D;
Chris Reading, PhD, Executive Vice President - Neuroscience R&D; and Clarence Ahlem, Executive Vice President - Neuroscience Product
Development. These individuals devote their full-time efforts to the Company activities. The company has 13 employees which are all full
time. We also rely on a team of highly experienced scientific, medical, and regulatory consultants to conduct its product development
activities.
ITEM 1A. RISK FACTORS
Our business, financial condition, operating results and prospects are
subject to the following risks. Additional risks and uncertainties not presently foreseeable to us may also impair our business operations.
If any of the following risks or the risks described elsewhere in this report actually occurs, our business, financial condition or operating
results could be materially adversely affected. In such case, the trading price of our common stock could decline, and our stockholders
may lose all or part of their investment in the shares of our common stock.
This Form 10-K contains forward-looking statements that involve risks and
uncertainties. These statements can be identified by the use of forward-looking terminology such as “believes,” “expects,”
“intends,” “plans,” “may,” “will,” “should,” “predict” or “anticipation”
or the negative thereof or other variations thereon or comparable terminology. Actual results could differ materially from those discussed
in the forward- looking statements as a result of certain factors, including those set forth below and elsewhere in this Form 10-K.
Risks Relating to Our Business and Industry
We have no products approved for commercial sale, have never generated
any revenues and may never achieve revenues or profitability, which could cause us to cease operations.
We have no products approved for commercial sale and, to date, we have
not generated any revenue. Our ability to generate revenue depends heavily on (a) successful completion of one or more development programs
demonstrating in human clinical trials that BIV201 and NE3107, our product candidates, are safe and effective; (b) our ability to seek
and obtain regulatory approvals, including, without limitation, with respect to the indications we are seeking; (c) successful commercialization
of our product candidates; and (d) market acceptance of our products. There are no assurances that we will achieve any of the forgoing
objectives. Furthermore, our product candidates are in the development stage, and have not been fully evaluated in human clinical trials.
If we do not successfully develop and commercialize our product candidates we will not achieve revenues or profitability in the foreseeable
future, if at all. If we are unable to generate revenues or achieve profitability, we may be unable to continue our operations.
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We are a development stage company with a limited operating history,
making it difficult for you to evaluate our business and your investment.
BioVie Inc. was incorporated on April 10, 2013. We are a development stage
biopharmaceutical company with potential therapies that have not been fully evaluated in clinical trials, and our operations are subject
to all of the risks inherent in the establishment of a new business enterprise, including but not limited to the absence of an operating
history, the lack of commercialized products, insufficient capital, expected substantial and continual losses for the foreseeable future,
limited experience in dealing with regulatory issues, the lack of manufacturing experience and limited marketing experience, possible
reliance on third parties for the development and commercialization of our proposed products, a competitive environment characterized
by numerous, well-established and well capitalized competitors and reliance on key personnel.
Since inception, we have not established any revenues or operations that
would provide financial stability in the long term, and there can be no assurance that we will realize our plans on our projected timetable
in order to reach sustainable or profitable operations.
Investors are subject to all the risks incident to the creation and development
of a new business and each investor should be prepared to withstand a complete loss of his, her or its investment. Furthermore, the accompanying
financial statements have been prepared assuming that we will continue as a going concern. We have not emerged from the development stage,
and may be unable to raise further equity. These factors raise substantial doubt about our ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Because we are subject to these risks, you may have a difficult time evaluating
our business and your investment in our Company. Our ability to become profitable depends primarily on our ability to develop drugs, to
obtain approval for such drugs, and if approved, to successfully commercialize our drugs, our research and development (“R&D”)
efforts, including the timing and cost of clinical trials; and our ability to enter into favorable alliances with third-parties who can
provide substantial capabilities in clinical development, regulatory affairs, sales, marketing and distribution.
Even if we successfully develop and market BIV201 and/or NE3107, we may
not generate sufficient or sustainable revenue to achieve or sustain profitability, which could cause us to cease operations and cause
you to lose all of your investment.
If the FDA or comparable foreign regulatory authorities approve generic
versions of any of our product candidates that receive marketing approval, or such authorities do not grant our products sufficient, or
any, periods of exclusivity before approving generic versions of our products, the sales of our products could be adversely affected.
Once a new drug application (“NDA”) is approved, the product
covered thereby becomes a “reference listed drug” or RLD, in the FDA’s publication, “Approved Drug Products with
Therapeutic Equivalence Evaluations,” commonly known as the Orange Book. Other manufacturers may seek approval of generic versions
of reference listed drugs through submission of abbreviated new drug applications (“ANDAs”) in the United States. In support
of an ANDA, a generic manufacturer need not conduct clinical trials. Rather, the applicant generally must show that its product has the
same active ingredient(s), dosage form, strength, route of administration and conditions of use or labeling as the reference listed drug
and that the generic version is bioequivalent to the reference listed drug, meaning it is absorbed in the body at the same rate and to
the same extent as the RLD. Generic products may be significantly less costly to bring to market than the reference listed drug and companies
that produce generic products are generally able to offer them at lower prices. Moreover, generic versions of RLDs are often automatically
substituted for the RLD by pharmacies when dispensing a prescription written for the RLD. Thus, following the introduction of a generic
drug, a significant percentage of the sales of any branded product or reference listed drug is typically lost to the generic product.
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The FDA may not approve an ANDA for a generic product until any applicable
period of non-patent exclusivity for the reference listed drug has expired. The United States Federal Food, Drug, and Cosmetic Act (“FDCA”)
provides a period of five years of non-patent exclusivity for a new drug containing a new chemical entity (“NCE”). An NCE
is an active ingredient that has not previously been approved by FDA in any other NDA. Specifically, in cases where such exclusivity has
been granted, an ANDA may not be submitted to the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV
certification that a patent covering the reference listed drug is either invalid or will not be infringed by the generic product, in which
case the applicant may submit its application four years following approval of the reference listed drug. If an ANDA is submitted to FDA
with a Paragraph IV Certification, the generic applicant must also provide a “Paragraph IV Notification” to the holder of
the NDA for the RLD and to the owner of the listed patent(s) being challenged by the ANDA applicant, providing a detailed written statement
of the basis for the ANDA applicant’s position that the relevant patent(s) is invalid or would not be infringed. If the patent owner
brings a patent infringement lawsuit against the ANDA applicant within 45 days of the Paragraph IV Notification, FDA approval of the ANDA
will be automatically stayed for 30 months, or until 7-1/2 years after the NDA approval if the generic application was filed between 4
years and 5 years after the NDA approval. Any such stay will be terminated earlier if the court rules that the patent is invalid or would
not be infringed.
While we believe that BIV201 contains an active ingredient, terlipressin,
that would be treated as an NCE by the FDA and, therefore, if it is the first terlipressin drug product to be approved, should be afforded
NCE exclusivity, the FDA may disagree with that conclusion and may approve generic products after a period that is less than five years.
If the FDA were to award NCE exclusivity to someone who receives approval of a terlipressin drug product before us, we believe that we
could still be awarded a different type of exclusivity protection from generic competition, which is awarded when an NDA or supplemental
NDA for a new use of a drug contains reports of new clinical investigations (other than bioavailability studies) conducted or sponsored
by an applicant and which FDA deems to have been essential for approval of the application or supplement. Such exclusivity prevents FDA
approval of a generic version of the RLD for three years from the date of the RLD approval. Manufacturers may seek to launch generic products
following the expiration of any applicable marketing exclusivity period, even if we still have patent protection for our product and no
30-month stay is in effect. If we do not maintain patent protection and regulatory exclusivity for our product candidates, our business
may be materially harmed.
Competition that our products may face from generic versions of our products
could materially and adversely impact our future revenue, profitability and cash flows and substantially limit our ability to obtain a
return on the investments we have made in those product candidates.
If we fail to obtain
or maintain Orphan Drug exclusivity for BIV201, we will have to rely on other potential marketing exclusivity, and on our intellectual
property rights, which may reduce the length of time that we can prevent competitors from selling generic versions of BIV201.
We have obtained Orphan Drug Designation for BIV201 (terlipressin) in the
U.S. for the treatment of hepatorenal syndrome (received November 21, 2018) and treatment of ascites due to all etiologies except cancer
(received September 8, 2016). Under the Orphan Drug Act, the FDA may designate a product as an Orphan Drug if it is a drug intended to
treat a rare disease or condition, defined, in part, as a patient population of fewer than 200,000 in the U.S. In the EU, Orphan Drug
designation may be granted to drugs intended to treat, diagnose or prevent a life-threatening or chronically debilitating disease having
a prevalence of no more than five in 10,000 people in the EU, and which meet other specified criteria. The company that first obtains
FDA approval for a designated Orphan Drug for the associated rare disease may receive a seven year period of marketing exclusivity during
which time FDA may not approve another application for the same drug for the same orphan disease or condition. Orphan Drug Exclusivity
does not prevent FDA approval of another application for the same drug for a different disease or condition, or of an application for
a different drug for the same rare disease or condition. Orphan Drug exclusive marketing rights may be lost under several circumstances,
including a later determination by the FDA that the request for designation was materially defective or if the manufacturer
is unable to assure sufficient quantity of the drug. Similar regulations are available in the EU with a ten-year period of market exclusivity.
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Even though BioVie has obtained two Orphan Drug Designations for its lead
product candidate, terlipressin, for treatment of ascites and for treatment of hepatorenal syndrome, and may seek other Orphan Drug Designations
for BIV201, and Orphan Drug Designation for other product candidates, there is no assurance that BioVie will be the first to obtain marketing
approval for any particular rare indication. Further, even though BioVie has obtained Orphan Drug Designations for its lead product candidate,
or even if BioVie obtains Orphan Drug Designation for other potential product candidates, such designation may not effectively protect
BioVie from competition because different drugs can be approved for the same condition and the same drug can be approved for different
conditions and potentially used off-label in the Orphan indication. Even after an Orphan Drug is approved, the FDA can subsequently approve
another competing drug with the same active ingredient for the same condition for several reasons, including, if the FDA concludes that
the later drug is clinically superior due to being safer or more effective or because it makes a major contribution to patient care. Orphan
Drug Designation neither shortens the development time or regulatory review time of a drug, nor gives the drug any advantage in the regulatory
review or approval process.