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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): April 8, 2022

 

Biofrontera Inc.

(Exact name of registrant as specified in its charter)

 

Delaware   001-40943   47-3765675
(State or other jurisdiction
of incorporation)
  (Commission
File Number)
  (IRS Employer
Identification No.)

 

120 Presidential Way, Suite 330

Woburn, Massachusetts

  01801
(Address of principal executive offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (781) 245-1325

 

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Exchange Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
Common stock, par value $0.001 per share   BFRI   The Nasdaq Stock Market LLC
Warrants, each warrant exercisable for one share of common stock, each at an exercise price of $5.00 per share   BFRIW   The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (the “Exchange Act”) (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 

 

 

 

Item 2.02 Results of Operations and Financial Condition.

 

On April 8, 2022, Biofrontera, Inc. (the “Company”) issued a press release announcing its financial and operational results for the fourth quarter and fiscal year ended December 31, 2021. A copy of the press release is being furnished as Exhibit 99.1 attached hereto to this Current Report on Form 8-K.

 

The Company’s press release contains non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP. Pursuant to the requirements of Regulation G, the Company has provided within the press release quantitative reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

 

The information contained in this Item 2.02 in the Current Report on Form 8-K (including Exhibit 99.1 attached hereto) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

99.1   Press release dated April 8, 2022
104   Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL document)

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

April 8, 2022

(Date)

 

Biofrontera Inc.

(Registrant)

   
    /s/ Erica L. Monaco
    Erica L. Monaco
    Chief Executive Officer

 

 

 

 

Exhibit 99.1

 

Logo, company name

Description automatically generated

PRESS RELEASE

 

APRIL 8, 2022

 

Biofrontera Inc. Reports Fourth Quarter and Full Year 2021 Financial Results and Provides a Business Update

 

Introduces 2022 financial guidance

Conference call begins at 11:00 a.m. Eastern time today

 

WOBURN, Mass. (April 8, 2022) – Biofrontera Inc. (Nasdaq: BFRI) (the “Company”), a biopharmaceutical company specializing in the commercialization of dermatological products, today announced financial results for the three and 12 months ended December 31, 2021, and provided a business update.

 

Financial Highlights

 

  Total revenues for the fourth quarter of 2021 were $9.2 million, an increase of 7% from the prior year
  Total revenues for 2021 were $24.1 million, an increase of 28% from the prior year
  Cash and cash equivalents were $24.5 million as of December 31, 2021
  Raised gross proceeds of $18 million from an initial public offering (IPO) and $15 million from a subsequent private placement
  Raised $13 million from the exercise of outstanding warrants, reducing Biofrontera AG’s ownership of Biofrontera Inc. to less than 50%

 

Clinical and Operational Highlights

 

  Initiated two clinical studies to expand the Ameluz® photodynamic therapy (PDT) market opportunity in the U.S.
  Enrolled the first subject in a Phase 1 safety study evaluating PDT with three tubes of Ameluz®
  Enrolled the first subject in a Phase 2b study evaluating Ameluz® + BF-RhodoLED® (Ameluz®-PDT) in moderate-to-severe acne
  Continued recruitment of subjects in a Phase 3 study evaluating Ameluz®-PDT for the treatment of basal cell carcinoma
  Appointed Kevin Weber, a pharmaceutical executive with more than 30 years of executive and commercial experience, to the Company’s Board of Directors
  Received notices of allowance for U.S. patents on a PDT illumination protocol and an illumination device
  Received U.S. regulatory clearance for the RhodoLED® XL lamp
  Received Orange Book listing for a RhodoLED® XL lamp patent, providing Ameluz®-PDT with protection from generic competition through October 2040

 

1

 

 

Management Commentary

 

“2021 was a foundational year for Biofrontera Inc. From completing our IPO in October to laying the groundwork for expanding the label of our flagship product Ameluz®, I’m proud of the hard work by our team in executing Biofrontera’s strategic vision. We entered 2022 with the capital, commercial momentum and strategic plan in place to build shareholder value,” said Erica Monaco, Chief Executive Officer of Biofrontera Inc.

 

“Despite continued challenges resulting from the COVID-19 pandemic, we returned to topline growth in 2021 and sales have now recovered to near pre-pandemic levels including a seasonally strong fourth quarter. In 2021 we increased our market share within the PDT drug segment to approximately 26%, up from approximately 24% in the previous year. We expect the momentum established in 2021 will continue to drive revenue growth from top customer accounts as the opportunity to gain share from cryotherapy remains a key focus of our commercial efforts. Our goal is to continue to improve the market positioning of Ameluz® to become the leading PDT drug for the treatment of actinic keratosis (AK) in the United States,” she added.

 

Fourth Quarter Financial Results

 

Total revenues were $9.2 million and $8.6 million for the three months ended December 31, 2021 and 2020, respectively, an increase of $0.6 million, or 7%.

 

Total operating expenses were $11.0 million and $8.8 million for the three months ended December 31, 2021 and 2020, respectively. Cost of revenues increased by 8% primarily due to higher sales of Ameluz®. Selling, general and administrative expenses increased by $5.1 million compared with the prior year primarily due to an increase in marketing expenses and headcount.

 

Net loss was $14.5 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively.

 

Adjusted EBITDA was negative $3.2 million and negative $3 thousand for the three months ended December 31, 2021 and 2020, respectively. Adjusted EBITDA, a non-GAAP financial measure, is defined as net income or loss excluding interest income and expense, income taxes, depreciation and amortization, legal settlement expense and certain other non-recurring or non-cash items.

 

Full Year Financial Results

 

Total revenues were $24.1 million and $18.8 million for 2021 and 2020, respectively, an increase of $5.3 million, or 28%. The increase was primarily driven by a higher volume of Ameluz® orders, which increased Ameluz® revenue by $4.1 million, and by an increase in the price of Ameluz®, which increased Ameluz® revenue by $1.3 million.

 

Total operating expenses were $49.3 million and $28.5 million for 2021 and 2020, respectively. Cost of revenues increased by $3.7 million compared with the prior year primarily due to higher sales of Ameluz®. Selling, general and administrative expenses increased by $19.1 million compared with the prior year primarily due to a one-time legal settlement expense, marketing campaign expenses, increased headcount and higher commission expenses related to improved sales performance.

 

2

 

 

Net loss was $37.7 million and $11.0 million for the years ended December 31, 2021 and 2020, respectively.

 

Adjusted EBITDA was negative $12.7 million for the year ended December 31, 2021 and was negative $9.2 million for the year ended December 31, 2020.

 

The table below presents a reconciliation from net loss to Adjusted EBITDA for the three and 12 months ended December 31, 2021 and 2020:

 

  

Quarters ended

December 31,

  

Years ended

December 31,

 
   2021   2020   2021   2020 
Net income/(loss)  $(14,505)  $(186)  $(37,713)  $(10,987)
Interest expense, net   89    756    344    2,869 
Income tax expenses   5    (2)   56    64 
Depreciation and amortization   131    138    540    562 
EBITDA   (14,280)   706)   (36,773)   (7,492)
                     
Change in fair value of contingent consideration   (3,100)   (98)   (1,402)   140 
Change in fair value of warrant liabilities   12,801    -    12,801    - 
Cost reimbursement from Biofrontera Pharma GmbH   -    (312)   -    (1,500)
Legal settlement expenses   -    -    11,250    - 
Employee retention credit (“ERC”)   -    (299)   -    (299)
Expensed issuance costs   1,383    -    1,383    - 
Adjusted EBITDA  $(3,196)  $(3)  $(12,741)  $(9,151)
Adjusted EBITDA margin   -34.9%   0.0%   -52.9%   -48.5%

 

Cash and cash equivalents as of December 31, 2021 were $24.5 million, compared with $8.1 million as of December 31, 2020. During 2021, Biofrontera received net proceeds of $41.8 million including $14.9 million from the sale of common stock in its IPO, $13.6 million from a private placement and $13.2 million from warrants exercised for its common stock. The Company believes its cash and cash equivalents are sufficient to fund its operations for at least the next 12 months.

 

Financial Guidance

 

Biofrontera today introduced financial guidance for 2022, as follows:

 

  Total revenues are expected to increase by at least 30% compared with 2021, including first quarter total revenues up by over 100% versus the first quarter prior year and typical seasonal strength in the first and fourth quarters
  The commercial focus throughout 2022 will be on achieving deeper sales penetration among current customer accounts, with additions to the Biofrontera sales force expected to begin in 2023

 

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Conference Call and Webcast

 

Biofrontera Inc. will hold a conference call today at 11:00 a.m. Eastern time to discuss these results and answer questions.

 

  Date:   Friday, April 8, 2022
  Time:   11:00 a.m. Eastern time
  Conference Call:   1-877-877-1275 (U.S.)
      1-412-858-5202 (international)
  Webcast:   Live and 90-day replay webcast are available here and at www.investors.biofrontera-us.com.

 

About Biofrontera Inc.

 

Biofrontera Inc. is a U.S.-based biopharmaceutical company commercializing a portfolio of pharmaceutical products for the treatment of dermatological conditions with a focus on PDT and topical antibiotics. The Company’s licensed products are used for the treatment of actinic keratoses, which are pre-cancerous skin lesions, as well as impetigo, a bacterial skin infection. For more information, visit www.biofrontera-us.com.

 

Forward-Looking Statements

 

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, as amended to date. These statements include, but are not limited to, statements relating to the Company’s business and marketing strategy, future operations and business, future financial position, potential to expand the label of Ameluz®, expected revenue growth, expected cash flow for operations, expected total revenues, projections constituting the financial guidance included in this release and statements about the commercial focus of Biofrontera Inc. throughout the year and expected increases in the Company’s sales force. We have based these forward-looking statements on our current expectations and projections about future events, nevertheless, actual results or events could differ materially from the plans, intentions and expectations disclosed in, or implied by, the forward-looking statements we make. These risks and uncertainties, many of which are beyond our control, including, but not limited to, the impact of extraordinary external events, such as the current COVID-19 pandemic; any changes in the Company’s relationship with its licensors; the ability of the Company’s licensors to fulfill their obligations to the Company in a timely manner; the Company’s ability to achieve and sustain profitability; whether the current global disruptions in supply chains will impact the Company’s ability to obtain and distribute its licensed products; changes in the practices of healthcare providers, including any changes to the coverage, reimbursement and pricing for procedures using the Company’s licensed products; the uncertainties inherent in the initiation and conduct of clinical trials; availability and timing of data from clinical trials; whether results of earlier clinical trials or trials of Ameluz® in combination with BF-RhodoLED® in different disease indications or product applications will be indicative of the results of ongoing or future trials; uncertainties associated with regulatory review of clinical trials and applications for marketing approvals; whether the market opportunity for Ameluz® in combination with BF-RhodoLED® is consistent with the Company’s expectations; the Company’s ability to complete the transition to a public company;the Company’s ability to retain and hire key personnel; the sufficiency of cash resources and need for additional financing and other factors that may be disclosed in the Company’s filings with the SEC, which can be obtained on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date on which they are made and reflect management’s current estimates, projections, expectations and beliefs. The Company does not plan to update any such forward-looking statements and expressly disclaims any duty to update the information contained in this press release except as required by law.

 

Contacts:

 

Biofrontera Inc.

 

Anke zur Mühlen

+1 781 486 1539

us-ir@biofrontera.com

 

LHA Investor Relations

 

Tirth T. Patel

+1 212 201 6614

tpatel@lhai.com

 

(Tables to follow)

 

4

 

 

BIOFRONTERA INC.

BALANCE SHEETS

(In thousands, except par value and share amounts)

 

   December 31, 
   2021   2020 
ASSETS          
Current assets:          
Cash and cash equivalents  $24,545   $8,080 
Accounts receivable, net   3,784    3,216 
Other receivables, related party   8,647    73 
Inventories   4,458    7,091 
Prepaid expenses and other current assets   4,987    1,116 
           
Total current assets   46,421    19,576 
           
Other receivables long term, related party   2,813    - 
Property and equipment, net   267    370 
Intangible asset, net   3,450    3,869 
Other assets   268    323 
           
Total assets  $53,219   $24,138 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities:          
Accounts payable  $658   $176 
Accounts payable, related parties   282    1,538 
Acquisition contract liabilities, net   3,242    - 
Accrued expenses and other current liabilities   9,654    2,706 
           
Total current liabilities   13,836    4,420 
           
Long-term liabilities:          
Acquisition contract liabilities, net   9,542    13,828 
Warrant liabilities   12,854    - 
Other liabilities   5,649    62 
           
Total liabilities  $41,881   $18,310 
           
Commitments and contingencies (see Note 23)          
           
Stockholders’ equity:          
Common Stock, $0.001 par value, 300,000,000 shares authorized; 17,104,749 and 8,000,000 shares issued and outstanding as of December 31, 2021 and 2020  $17   $8 
Additional paid-in capital   90,200    46,986 
Accumulated deficit   (78,879)   (41,166)
           
Total stockholders’ equity   11,338    5,828 
           
Total liabilities and stockholders’ equity  $53,219   $24,138 

 

5

 

 

BIOFRONTERA INC.

STATEMENTS OF OPERATIONS

(In thousands, except per share amounts and number of shares)

 

   Year Ending December 31, 
   2021   2020 
         
Products revenues, net  $24,043   $18,787 
Revenues, related party   57    62 
           
Total revenues, net   24,100    18,849 
           
Operating expenses          
Cost of revenues, related party   12,222    8,313 
Cost of revenues, other   520    753 
Selling, general and administrative   36,512    17,706 
Selling, general and administrative, related party   697    411 
Restructuring costs   752    1,132 
Change in fair value of contingent consideration   (1,402)   140 
           
Total operating expenses   49,301    28,455 
           
Loss from operations   (25,201)   (9,606)
           
Other income (expense)          
Change in fair value of warrant liabilities   (12,801)   - 
Interest expense, net   (344)   (2,869)
           
Other income, net   689    1,552 
           
Total other income (expense)   (12,456)   (1,317)
           
Loss before income taxes   (37,657)   (10,923)
Income tax expense   56    64 
           
Net loss  $(37,713)  $(10,987)
           
Loss per common share:          
Basic and diluted  $(4.28)  $(479.48)
           
Weighted-average common shares outstanding:          
Basic and diluted   8,808,233    22,915 

 

# # #

 

6

 

 

BIOFRONTERA INC.

STATEMENTS OF OPERATIONS

(In thousands, except per share amounts and number of shares)

 

   Quarters Ended December 31, 
   2021   2020 
         
Products revenues, net  $9,153   $8,557 
Revenues, related party   15    15 
           
Total revenues, net   9,168    8,572 
           
Operating expenses          
Cost of revenues, related party   4,592    4,288 
Cost of revenues, other   181    135 
Selling, general and administrative   9,100    4,149 
Selling, general and administrative, related party   177    14 
Restructuring costs   98    272 
Change in fair value of contingent consideration   (3,100)   (98)
           
Total operating expenses   11,048    8,760 
           
Loss from operations   (1,880)   (188)
           
Other income (expense)          
Change in fair value of warrant liabilities   (12,801)   - 
           
Interest expense, net   (89)   (756)
           
Other income, net   270    756 
           
Total other income (expense)   (12,620)   (0)
           
Loss before income taxes   (14,500)   (188)
Income tax expense   5    (2)
           
Net loss  $(14,505)  $(186)
           
Loss per common share:          
Basic and diluted  $(1.29)  $(2.12)
           
Weighted-average common shares outstanding:          
Basic and diluted   11,206,578    87,946 

 

7