Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nasdaq  >  Akers Biosciences, Inc.    AKER

AKERS BIOSCIENCES, INC.

(AKER)
  Report
SummaryQuotesChartsNewsCalendarCompanyFinancials 
SummaryMost relevantAll NewsPress ReleasesOfficial PublicationsSector news

AKERS BIOSCIENCES : Management's Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

05/15/2020 | 04:14pm EST
This quarterly report on Form 10-Q and other reports filed by Akers Biosciences,
Inc. ("Akers," "Akers Bio," "we" or the "Company") from time to time with the
SEC (collectively, the "Filings") contain or may contain forward-looking
statements and information that are based upon beliefs of, and information
currently available to, the Company's management as well as estimates and
assumptions made by Company's management. Readers are cautioned not to place
undue reliance on these forward-looking statements, which are only predictions
and speak only as of the date hereof. When used in the Filings, the words
"anticipate," "believe," "estimate," "expect," "future," "intend," "plan," or
the negative of these terms and similar expressions as they relate to the
Company or the Company's management identify forward-looking statements. Such
statements reflect the current view of the Company with respect to future events
and are subject to risks, uncertainties, assumptions, and other factors,
including the risks relating to the Company's business, industry, and the
Company's operations and results of operations. Should one or more of these
risks or uncertainties materialize, or should the underlying assumptions prove
incorrect, actual results may differ significantly from those anticipated,
believed, estimated, expected, intended, or planned.



Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, the Company cannot guarantee future
results, levels of activity, performance, or achievements. Except as required by
applicable law, including the securities laws of the United States, the Company
does not intend to update any of the forward-looking statements to conform these
statements to actual results.



Important factors that could cause actual results to differ materially from the
results and events anticipated or implied by such forward-looking statements
include, but are not limited to:



? changes in the market acceptance of our products and services;

? challenges we may face in identifying, acquiring and operating new business

opportunities;

? the outcome of litigation or other proceedings to which we are subject as

described in the "Legal Proceedings" section of this Report or which we may

become subject to in the future;

? increased levels of competition;

? changes in political, economic or regulatory conditions generally and in the

markets in which we operate;

? our relationships with our key customers;

? adverse conditions in the industries in which our customers operate;

? our ability to retain and attract senior management and other key employees;

? our ability to quickly and effectively respond to new technological

developments;

? delisting of our common stock from the NASDAQ capital market;

? our ability to protect our trade secrets or other proprietary rights, operate

without infringing upon the proprietary rights of others and prevent others

from infringing on our proprietary rights;

? our ability to achieve the expected benefits and costs of the transactions

   related to the acquisition of Cystron, including:



? the timing of, and our ability to, obtain and maintain regulatory approvals

for clinical trials of our vaccine product candidate;

? the timing and results of our planned clinical trials for our vaccine product

    candidate;

  ? the amount of funds we require for our vaccine product candidate; and

? our ability to maintain our existing license with Premas Biotech PVT Ltd.

? the impact of the recent COVID-19 outbreak on our results of operations,

business plan and the global economy.





Our financial statements are prepared in accordance with accounting principles
generally accepted in the United States ("GAAP"). These accounting principles
require us to make certain estimates, judgments and assumptions. We believe that
the estimates, judgments and assumptions upon which we rely are reasonable based
upon information available to us at the time that these estimates, judgments and
assumptions are made. These estimates, judgments and assumptions can affect the
reported amounts of assets and liabilities as of the date of the financial
statements as well as the reported amounts of revenues and expenses during the
periods presented. Our financial statements would be affected to the extent
there are material differences between these estimates and actual results. In
many cases, the accounting treatment of a particular transaction is specifically
dictated by GAAP and does not require management's judgment in its application.
There are also areas in which management's judgment in selecting any available
alternative would not produce a materially different result. The following
discussion should be read in conjunction with our financial statements and notes
thereto appearing elsewhere in this report.



Overview



We were incorporated in 1989 in the state of New Jersey. Our principal executive
offices are located at 201 Grove Road, Thorofare, New Jersey USA 08086, and our
telephone number is (856) 848-8698. Our corporate website address is
www.akersbio.com.



On March 23, 2020, we entered into a Membership Interest Purchase Agreement (the
"MIPA") with the members of Cystron Biotech, LLC (individually, each a "Seller,"
and collectively, the "Sellers"), pursuant to which the Company acquired 100% of
the membership interests (the "Membership Interests") of Cystron Biotech, LLC
("Cystron"). Cystron is a party to a license agreement with Premas Biotech PVT
Ltd ("Premas") whereby Premas granted Cystron, amongst other things, an
exclusive license with respect to Premas' vaccine platform for the development
of a vaccine against COVID-19 and other coronavirus infections.



We continue to sell our rapid, point-of-care screening and testing products, but
at continued reduced volumes compared to prior years. As a result, we continue
to experience low sales revenue from our screening and testing products. We are
also experiencing a production backlog for some of our screening and testing
products, which will further reduce our sales revenue. In addition, as we
previously reported, we eliminated our sales force for our screening and testing
products. In light of these facts and the progress that we have made in our
partnership with Premas for the development of a vaccine candidate for COVID-19,
as previously announced, we recently initiated a strategic review of the
screening and testing products business. As part of this review, we are
exploring potential strategic and alternative transactions, which may include
the disposition or winddown of our screening and testing products business. As a
result, the makeup of our lines of business is subject to change.



COVID-19



The ultimate impact of the global COVID-19 pandemic or a similar health epidemic
is highly uncertain and subject to change. We do not yet know the full extent of
potential delays or impacts on our business, our vaccine development efforts,
healthcare systems or the global economy as a whole. However, the effects are
likely to have a material impact on our operations, liquidity and capital
resources, and we will continue to monitor the COVID-19 situation closely.



In response to public health directives and orders, we have implemented
work-from-home policies for many of our employees and temporarily modified our
operations to comply with applicable social distancing recommendations. The
effects of the orders and our related adjustments in our business are likely to
negatively impact productivity, disrupt our business and delay our timelines,
the magnitude of which will depend, in part, on the length and severity of the
restrictions and other limitations on our ability to conduct our business in the
ordinary course. Similar health directives and orders are affecting third
parties with whom we do business. Further, restrictions on our ability to
travel, stay-at-home orders and other similar restrictions on our business have
limited our ability to support our operations.



Severe and/or long-term disruptions in our operations will negatively impact our
business, operating results and financial condition in other ways, as well.
Specifically, we anticipate that the stress of COVID-19 on healthcare systems
around the globe will negatively impact our ability to produce our testing
products and will negatively impact the distributors and healthcare facilities
that purchase these testing products.



In addition, while the potential economic impact brought by, and the duration
of, COVID-19 may be difficult to assess or predict, it has significantly
disrupted global financial markets, and may limit our ability to access capital,
which could in the future negatively affect our liquidity. A recession or market
correction resulting from the spread of COVID-19 could materially affect our
business and the value of our common stock.



  33






Key Events



Acquisition of Cystron


On March 23, 2020, we acquired Cystron pursuant to the MIPA.

As consideration for the Membership Interests, we delivered to the Sellers: (1)
that number of newly issued shares of our common stock equal to 19.9% of the
issued and outstanding shares of our common stock and pre-funded warrants as of
the date of the MIPA, but, to the extent that the issuance of our common stock
would have resulted in any Seller owning in excess of 4.9% of our outstanding
common stock, then, at such Seller's election, such Seller received "common
stock equivalent" preferred shares with a customary 4.9% blocker (with such
common stock and preferred stock collectively referred to as "Common Stock
Consideration"), and (2) $1,000,000 in cash. On March 24, 2020, we delivered
411,403 shares of common stock and 211,353 shares of Series D Convertible
Preferred Stock with a customary 4.9% blocker. On April 22, 2020, Premas, one of
the sellers of Cystron, returned to us $299,074, representing its portion of the
cash purchase price to acquire Cystron. Premas has advised us that these funds
were returned temporarily in order for Premas to meet certain regulatory
requirements in India.



Additionally, we are required to (A) make an initial payment to the Sellers of
up to $1,000,000 upon our receipt of cumulative gross proceeds from the
consummation of an initial equity offering after the date of the MIPA of
$8,000,000, and (B) pay to Sellers an amount in cash equal to 10% of the gross
proceeds in excess of $8,000,000 raised from future equity offerings after the
date of the MIPA until the Sellers have received an aggregate additional cash
consideration equal to $10,000,000 (collectively, the "Equity Offering
Payments"). On May 14, 2020, the Company and the Sellers entered into an
Amendment No. 1 to the MIPA, which provided that any Equity Offering Payments in
respect of an equity offering that is consummated prior to September 23, 2020,
shall be accrued, but shall not be due and payable until September 24, 2020. The
other provisions of the MIPA remain unmodified and in full force and effect.
Upon the achievement of certain milestones, including the completion of a Phase
2 study for a COVID-19 vaccine that meets its primary endpoints, Sellers will be
entitled to receive an additional 750,000 shares of our common stock or, in the
event we are unable to obtain stockholder approval for the issuance of such
shares, 750,000 shares of non-voting preferred stock that are valued following
the achievement of such milestones and shall bear a 10% annual dividend (the
"Milestone Shares"). Sellers will also be entitled to contingent payments from
us of up to $20,750,000 upon the achievement of certain milestones, including
the approval of a new drug application by the U.S. Food and Drug Administration
("FDA"). Pursuant to the MIPA, upon the Company's consummation of the registered
direct equity offering closed on April 8, 2020, we paid the Sellers $250,000 on
April 20, 2020. On April 30, 2020, Premas, one of the Sellers, returned to us
$83,334, representing their portion of the $250,000 amount paid to the Sellers
on April 20, 2020. Premas has advised us that these funds were returned
temporarily in order for Premas to meet certain regulatory requirements in
India.



We shall also make quarterly royalty payments to Sellers equal to 5% of the net
sales of a COVID-19 vaccine or combination product by the Company (the "COVID-19
Vaccine") for a period of five (5) years following the first commercial sale of
the COVID-19 Vaccine, provided that such payment shall be reduced to 3% for any
net sales of the COVID-19 Vaccine above $500 million.



In addition, Sellers shall be entitled to receive 12.5% of the transaction
value, as defined in the MIPA, of any change of control transaction, as defined
in the MIPA, that occurs prior to the fifth (5th) anniversary of the closing
date of the MIPA, provided that the Company is still developing the COVID-19
Vaccine at that time. Following the consummation of any change of control
transaction, the Sellers shall not be entitled to any payments as described
above under the MIPA.



Support Agreement



On March 23, 2020, as an inducement to enter into the MIPA, and as one of the
conditions to the consummation of the transactions contemplated by the MIPA, the
Sellers entered into a shareholder voting agreement with the Company (the
"Support Agreement"), pursuant to which each Seller agreed to vote their shares
of our common stock or preferred stock in favor of each matter proposed and
recommended for approval by our management at every meeting of the stockholders
and on any action or approval by written consent of the stockholders.



Registration Rights Agreement

To induce the Sellers to enter into the MIPA, on March 23, 2020, we entered into
a registration rights agreement (the "Registration Rights Agreement") with the
Sellers, pursuant to which we shall by the 30th day following the closing of the
transactions contemplated by the MIPA, file with the United States Securities
and Exchange Commission (the "SEC") an initial Registration Statement on Form
S-3 (if such form is available for use by the Company at such time) or,
otherwise, on Form S-1, covering all of the shares of our common stock issued,
or underlying the preferred stock issued, at closing under the MIPA and to
subsequently register the common stock issued or underlying the preferred stock
issued as Milestone Shares.



License Agreement



Cystron is a party to a License and Development Agreement (the "Initial License
Agreement") with Premas. As a condition to the Company's entry into the MIPA,
Cystron amended and restated the Initial License Agreement on March 19, 2020 (as
amended and restated, the "License Agreement"). Pursuant to the License
Agreement, Premas granted Cystron, among other things, an exclusive license with
respect to Premas' vaccine platform for the development of a vaccine against
COVID-19 and other coronavirus infections.



Upon the achievement of certain developmental milestones by Cystron, Cystron
shall pay to Premas a total of up to $2,000,000. On April 16, 2020, we paid
Premas $500,000 for the achievement of the first two development milestones, of
which $250,000 was accrued as research and development expense for the three
months ended March 31, 2020. On May 14, 2020, we and Premas agreed that
Milestone No. 3 under the License Agreement has been satisfied. Due to the
achievement of this milestone, Premas is entitled to receive a payment of
$500,000 from the Company.



  34





Series D Convertible Preferred Stock

On March 24, 2020, we filed the Certificate of Designation of Preferences,
Rights and Limitations of Series D Convertible Preferred Stock (the "Certificate
of Designation") with the Secretary of State of the State of New Jersey.
Pursuant to the Certificate of Designation, in the event of the Company's
liquidation or winding up of its affairs, the holders of our Series D
Convertible Preferred Stock (the "Preferred Stock") will be entitled to receive
the same amount that a holder of our common stock would receive if the Preferred
Stock were fully converted (disregarding for such purposes any conversion
limitations set forth in the Certificate of Designation) to common stock which
amounts shall be paid pari passu with all holders of the Company's common stock.
Each share of Preferred Stock has a stated value equal to $0.01 (the "Stated
Value"), subject to increase as set forth in Section 7 of the Certificate of
Designation.


A holder of Preferred Stock is entitled at any time to convert any whole or partial number of shares of Preferred Stock into shares of our common stock determined by dividing the Stated Value of the Preferred Stock being converted by the conversion price of $0.01 per share.




A holder of Preferred Stock will be prohibited from converting Preferred Stock
into shares of our common stock if, as a result of such conversion, the holder,
together with its affiliates, would own more than 4.99% of the total number of
shares of our common stock then issued and outstanding (with such ownership
restriction referred to as the "Beneficial Ownership Limitation"). However, any
holder may increase or decrease such percentage to any other percentage not in
excess of 9.99%, provided that any increase in such percentage shall not be
effective until 61 days after such notice to us.



Subject to the Beneficial Ownership Limitation, on any matter presented to our
stockholders for their action or consideration at any meeting of our
stockholders (or by written consent of stockholders in lieu of a meeting), each
holder of Preferred Stock will be entitled to cast the number of votes equal to
the number of whole shares of our common stock into which the shares of
Preferred Stock beneficially owned by such holder are convertible as of the
record date for determining stockholders entitled to vote on or consent to such
matter (taking into account all Preferred Stock beneficially owned by such
holder). Except as otherwise required by law or by the other provisions of our
certificate of incorporation, the holders of Preferred Stock will vote together
with the holders of our common stock and any other class or series of stock
entitled to vote thereon as a single class.



A holder of Preferred Stock shall be entitled to receive dividends as and when paid to the holders of our common stock on an as-converted basis.

Production Backlog of PIFA® Heparin/PF4 and PIFA® PLUSS/PF4




We are currently experiencing a production backlog of our PIFA® Heparin/PF4 and
PIFA® PLUSS/PF4 rapid assays. While we believe that we will be able to remedy
the production backlog, we cannot be certain what impact this backlog will have
on our business, and it may have an adverse effect on our 2020 revenues and
results of operation. As discussed above, we recently initiated a strategic
review of the screening and testing products business.



Exploration of Strategic Alternatives

On November 7, 2018, we announced that our board of directors had initiated a
process to evaluate strategic alternatives to maximize shareholder value. The
Company will continue its strategic alternatives review and has identified the
hemp and minor cannabinoid sectors as potential opportunities that could benefit
from our core competencies. The Company continues to explore how to leverage its
30 years of operational history in its medical device business, where its
current products have FDA clearance, its current operations practice Good
Manufacturing Processes (cGMP), its medical device facility is certified under
ISO 13485 - 2016 and the facility carries an Analytical Lab Certification for
Schedules 2, 3, 4 and 5 controlled substances issued by the U.S. Drug
Enforcement Administration (DEA) and the State of New Jersey. The Company
intends to pursue opportunities in the extraction, testing, purification and
formulation of safe cannabinoids within the hemp industry, including pathways to
consumer products with a focus on minor cannabinoids.



  35







Summary of Statements of Operations for the Three Months Ended March 31, 2020 and 2019




Product Revenue



Akers' product revenue for the three months ended March 31, 2020 totaled $363,515, a 41% decrease from the same period in 2019. The table below summarizes our revenue by product line for the three months ended March 31, 2020 and 2019, as well as the percentage of change year-over-year:



                                                  For the Three Months Ended
                                                          March 31,                   Percent
Product Lines                                       2020               2019           Change

Particle ImmunoFiltration Assay ("PIFA") $ 354,458$ 576,317

             (38 )%
MicroParticle Catalyzed Biosensor ("MPC")                   -            23,320            (100 )%
Other                                                   9,057            12,486             (27 )%
Total Product Revenue                          $      363,515$   612,123             (41 )%



Product revenue from the Company's PIFA products decreased 38% to $354,458
(2019: $576,317) during the three months ended March 31, 2020, as compared to
the same period of 2019. The decrease in the 2020 quarter was principally
attributable to product supply issues encountered in the 2020 quarter that were
not experienced in the 2019 quarter. The Company shipped orders during the first
quarter, however production issues remain and there are still back orders to
fill.



Aker's largest U.S. distribution partners are Cardinal Health and Thermo Fisher
Scientific. Domestic net sales for the three months ended March 31, 2020 for
these two distributors accounted for $344,559 of the total PIFA related product
revenue as compared to $547,276 for the same period of 2019.



The Company's MPC product sales decreased by 100% to $0 (2019: $23,320) during the three months ended March 31, 2020.




Other revenue decreased to $9,057 (2019: $12,486) during the three months ended
March 31, 2020 due to a decline in shipping/handling revenue. The category is
made up principally of shipping and handling charges.



Gross Income



The Company's gross profit percentage declined to 52% (2019: 60%), principally
due to the impact of fixed production costs (personnel, consumables and facility
costs) against lower revenue. Gross income declined to $190,644 (2019: $366,186)
for the three months ended March 31, 2020, principally due to reduced revenue as
compared to the prior period.



Product cost of sales for the three months ended March 31, 2020 decreased to $172,871 (2019: $245,937) due to lower product revenues.

Research and Development Expenses

Research and development expenses for the three months ended March 31, 2020
totaled $2,483,057, which was a 100% increase as compared to $0 for the three
months ended March 31, 2019. During the three months ended March 31, 2020, we
acquired a license for the research and development of the COVID-19 Vaccine.



The table below summarizes our research and development expenses for the three
months ended March 31, 2020 and 2019 as well as the percentage of change
year-over-year:



                                               For the Three Months Ended
                                                       March 31,
Description                                    2020                 2019            Percent Change
Vaccine License and Development Costs          2,483,057                     -                  100 %
Total Research and Development Expenses   $    2,483,057       $           
 -                  100 %




Vaccine license and development costs increased by 100%, for the three months
ended March 31, 2020, as compared to the same period of 2019, due to the Cystron
acquisition costs of $2,233,057 ($1,000,000 in cash, $1,233,057 in Common and
Preferred stock), and $250,000 recorded upon Premas, our license developer
achieving a milestone.



Administrative Expenses


Administrative expenses for the three months ended March 31, 2020, totaled $1,157,732, which was an 18% increase as compared to $982,953 for the three months ended March 31, 2019.



  36






The table below summarizes our administrative expenses for the three months
ended March 31, 2020 and 2019 as well as the percentage of change
year-over-year:



                                            For the Three Months Ended
                                                     March 31,                 Percent
Description                                    2020               2019         Change

Personnel Costs                           $       283,507$ 208,038            36 %
Professional Service Costs                        547,356         229,883           138 %
Stock Market & Investor Relations Costs            47,882         214,554  
        (78 )%
Other Administrative Costs                        278,987         330,478           (16 )%
Total Administrative Expense              $     1,157,732$ 982,953            18 %




Personnel expenses increased by 36% for the three months ended March 31, 2020 as
compared to the same period of 2019 due to the addition of an executive staff
member who was not on payroll during the three months ended March 31, 2019.



Professional service costs increased 138% for the three months ended March 31,
2020 as compared to the same period of 2019, principally due to increased legal
fees $391,154 (2019: $150,322), the timing for recording audit fees $85,000
(2019: $40,041) and an increase in advisory and temporary consultants fees
$71,202 (2019: $39,520). The higher costs in 2020 were principally attributable
to the investigation into new products and the legal costs associated with the
acquisition of the COVID-19 Vaccine license.



Stock market and investor costs decreased 78% for the three months ended March
31, 2020. The decrease in these costs was principally associated with the
Company having delisted from the London Stock Exchange during the first quarter
of 2019, and thereafter avoiding the costs associated with a presence on the
London Stock Exchange.


Other administrative expenses decreased by 16%, principally attributable to decreased Board of Directors' fees and expenses $73,302 (2019: $102,906), building expenses $43,042 (2019: $54,608), computer expenses $5,512 (2019: $10,937) and uncollectable accounts $0 (2019: $4,247).



Sales and Marketing Expenses



Sales and marketing expenses for the three months ended March 31, 2020 totaled
$14,463 which was a 90% decrease compared to $149,841 for the three months
ended
March 31, 2019.



The table below summarizes our sales and marketing expenses for the three months
ended March 31, 2020 and 2019 as well as the percentage of change
year-over-year:



                                           For the Three Months Ended
                                                    March 31,                 Percent
Description                                   2020               2019         Change

Personnel Costs                          $            -       $   65,832          (100 )%
Professional Service Costs                      (12,677 )         22,391          (157 )%
Royalties and Outside Commission Costs           20,890           43,459           (52 )%
Other Sales and Marketing Costs                   6,250           18,159           (66 )%
Total Sales and Marketing Expenses       $       14,463$  149,841
       (90 )%



During the first quarter of 2019, as part of our cost savings measures, we eliminated the personnel within the sales and marketing departments, including employees, consultants and third-party related representatives.




Personnel expenses decreased by 100% for the three months ended March 31, 2020
as compared to the same period of 2019 on account of the reduction in the sales
and marketing headcount to zero during the three months ending March 31, 2019.



Professional service costs decreased 157% for the three months ended March 31,
2020, as compared to the same period of 2019, principally on account of
reductions in the services provided by third party vendors and the reversal of a
$15,000 charge for a marketing program.



  37





Royalties and outside commission costs decreased by 52 %, on account of the reduced revenues resulting in less royalties owed and the elimination of independent sales representatives (ISRs) in 2019.

Other sales and marketing costs declined to $6,250 (2019: $18,159) principally because the cost for support and maintenance of the OxiChek platform was eliminated. All 2020 costs are related to internet and web hosting.

Regulatory and Compliance Expenses




Regulatory and Compliance expenses for the three months ended March 31, 2020
totaled $72,091, which was an 18% decrease, as compared to $88,391 for the three
months ended March 31, 2019.



The table below summarizes our regulatory and compliance expenses for the three
months ended March 31, 2020 and 2019, as well as the percentage of change
year-over-year:



                                                  For the Three Months Ended
                                                           March 31,                   Percent
Description                                        2020                2019            Change

Personnel Costs                                $      61,736$      71,167             (13 )%
Professional Service Costs                             7,355               8,743             (16 )%
Other Regulatory and Compliance Costs                  3,000               8,481             (65 )%

Total Regulatory and Compliance Expenses $ 72,091$ 88,391

             (18 )%




Personnel costs decreased by 13% for the three months ended March 31, 2020 as
compared to the same period of 2019. In January 2019, our headcount was reduced
by one full-time employee.


Professional service costs declined by 16% for the three months ended March 31, 2020, as compared to the same period of 2019, principally due to lower regulatory audit fees.




Other regulatory and compliance costs decreased 65%, for the three months ended
March 31, 2020, as compared to the same period of 2019, principally due to a
decrease in the costs of lab supplies.



  38






Other Income and Expense


Other income, net of expense, for the three months ended March 31, 2020, totaled $7,037, as compared to $23,044 for the three months ended March 31, 2019.




The table below summarizes our other income and expenses for the three months
ended March 31, 2020 and 2019, as well as the percentage of change
year-over-year:



                                        For the Three Months Ended
                                                 March 31,                 Percent
Description                                2020               2019         Change

Impairment of Intangible Assets $ 2,952 $ -

    100 %
Currency Translation Losses                        -            4,659          (100 )%
Losses on Investments                         36,714            3,718           887 %
Interest and Dividend Income                 (46,703 )        (31,421 )          49 %
Total Other Income, Net of Expenses   $       (7,037 )$  (23,044 )
    (69 )%




Impairment of intangible assets, increased 100% to $2,952 for the three months
ended March 31, 2020 as compared to 2019. The increase is due to the impairment
of intellectual property related to breathscan products.



Foreign currency translation loss for the three months ended March 31, 2020 decreased 100%.




Loss on investments of $36,714 (2019 $$3,718) was principally due to the impact
of COVID-19 on the financial markets. Interest and dividend income increased to
$46,703 (2019 $31,421) principally due to the increase in funds available for
investment.


Liquidity and Capital Resources




As of March 31, 2020, the Company's cash on hand was $927,533 (which included
restricted cash of $115,094), and its marketable securities were $6,629,434. The
Company has incurred net losses of $3,538,536 for the three months ended March
31, 2020 and $3,888,249 for the year ended December 31, 2019, respectively. As
of March 31, 2020, the Company had working capital of $6,116,477 and
stockholder's equity of $6,817,451. During the three months ended March 31,
2020, cash flows used in operating activities were $1,966,983, consisting
primarily of a net loss of $3,538,536, which includes, principally, research and
development costs in connection with the purchase of a license and milestone
license fees in the aggregate amount of $2,483,057. Since its inception, the
Company has met its liquidity requirements principally through the sale of its
common stock in public and private placements.



On April 7, 2020, pursuant to a Securities Purchase Agreement (the "Purchase
Agreement") with certain institutional and accredited investors (the
"Purchasers"), the Company agreed to issue and sell in a registered direct
offering (the "Offering") an aggregate of 766,667 shares of common stock of the
Company at an offering price of $6.00 per share, for gross and net proceeds of
$4,600,002 and $4,146,102, respectively. The Offering closed on April 8, 2020.
Upon closing of the offering, the Company issued to the Placement Agent for the
Offering warrants (the "April Placement Agent Warrants") to purchase up to
61,333 shares of common stock at an exercise price of $7.50. The April Placement
Agent Warrants are exercisable at any time and from time to time, in whole or in
part, following the date of issuance and for a term of five years from April 7,
2020.


On April 20, 2020, the Company paid $250,000 of the net proceeds from the Offering to pay the former members of Cystron Biotech, LLC, pursuant to the terms of that certain MIPA.




During the period of April 6, 2020 through April 16, 2020, warrants to purchase
an aggregate of 1,043,500, shares of Series C Preferred Stock were exercised at
an exercise price of $4.00 per share, yielding proceeds of $4,174,000.



On May 14, 2020, we entered into a Securities Purchase Agreement (the "May
Purchase Agreement") with certain institutional and accredited investors (the
"May Purchasers"), pursuant to which the Company agreed to issue and sell in a
registered direct offering (the "May Offering") an aggregate of 1,366,856 shares
(the "May Shares") of our common stock at an offering price of $3.53 per share,
for gross and net proceeds of approximately $4.8 million and $4.3 million,
respectively. The closing of the May Offering is subject to the satisfaction of
customary closing conditions set forth in the May Purchase Agreement and is
expected to occur on or about May 18, 2020. In connection with the May Offering,
the Company has agreed to grant to the placement agent (the "Placement Agent")
warrants to purchase up to 109,348 shares of our common stock at an exercise
price of $4.4125 (the "May Placement Agent Warrants") in a private placement.
The May Placement Agent Warrants will be exercisable at any time and from time
to time, in whole or in part, following the date of issuance and for a term of
five years from the effective date of the May Offering.



Our current cash resources will not be sufficient to fund the development of our
COVID-19 Vaccine candidate through all of the required clinical trials to
receive regulatory approval and commercialization. While we do not currently
have an estimate of all of the costs that we will incur in the development of
our COVID-19 Vaccine candidate, we anticipate we will need to raise significant
additional funds in order to continue the development of our COVID-19 Vaccine
candidate during the next twelve months. In addition, we may also have increased
capital needs if we are to engage in a strategic transaction in the cannabinoid
space. Our ability to obtain additional capital may depend on prevailing
economic conditions and financial, business and other factors beyond our
control. The COVID-19 pandemic has caused an unstable economic environment
globally. Disruptions in the global financial markets may adversely impact the
availability and cost of credit, as well as our ability to raise money in the
capital markets. Current economic conditions have been and continue to be
volatile. Continued instability in these market conditions may limit our ability
to access the capital necessary to fund and grow our business.



The Company believes that its current financial resources as of the date of the
issuance of these consolidated financial statements, are sufficient to fund its
current twelve month operating budget, alleviating any substantial doubt raised
by our historical operating results and satisfying our estimated liquidity needs
for twelve months from the issuance of these consolidated financial statements.



  39






Operating Activities



Our net cash used by operating activities totaled $1,966,983 during the three
months ended March 31, 2020. Net cash used consisted principally of the net loss
of $3,538,536, offset by a non-cash adjustment principally consisting of the
fair value of shares issued for the purchase of a license of $1,233,057.



Our net cash consumed by operating activities totaled $748,735 during the three
months ended March 31, 2019. Cash was consumed by the loss of $916,958 reduced
by non-cash adjustments principally consisting of $2,314 for accrued loss on
marketable securities, $15,437 for depreciation and amortization of non-current
assets, $4,247 for the allowance of doubtful accounts and $15,542 for share
based compensation. For the three months ended March 31, 2019, within changes of
assets and liabilities, cash provided consisted of a decrease in deposits and
other receivables of $9,347, a decrease in prepaid expenses of $182,655, and an
increase in trade and other payables of $107,159, offset by an increase in trade
receivables of $152,445 and an increase in inventories of $16,033.



Investing Activities



The Company's net cash provided by investing totaled $2,261,901, as compared to
$822,502 during the three months ended March 31, 2020 and 2019, respectively.
Net cash provided by investing activities for the three months ended March 31,
2020 consisted of proceeds from the sale of marketable securities of $2,303,890,
offset by $41,989 consumed by the purchase of marketable securities. During the
three months ended March 31, 2019, investing activities consisted of proceeds
from the sale of marketable securities of $852,520, offset by $30,018 consumed
by the purchase of marketable securities and capital expenditures.



Financing Activities



The Company's net cash provided by financing activities during the three months
ended March 31, 2020 was $77.00 (2019: $0). Net cash provided during the 2020
period reflected principally net proceeds from the exercise of pre-funded equity
forward contracts for the purchase of common stock.



Critical Accounting Policies


See accounting policies in Note 2 of the condensed consolidated financial statements included in Part I, Item 1 of this report.

Off-Balance Sheet Arrangements

We have no significant known off balance sheet arrangements.

© Edgar Online, source Glimpses

All news about AKERS BIOSCIENCES, INC.
12/03AKERS BIOSCIENCES INVESTOR ALERT BY : Kahn Swick & Foti, LLC Investigates Merge..
BU
12/02AKERS BIOSCIENCES : ' Proposed Merger Partner MyMD Pharmaceuticals Announces Iss..
BU
11/20AKERS BIOSCIENCES, INC. : Change in Directors or Principal Officers (form 8-K)
AQ
11/18AKERS BIOSCIENCES, INC. : Other Events, Financial Statements and Exhibits (form ..
AQ
11/18AKERS BIOSCIENCES, INC. : Other Events, Financial Statements and Exhibits (form ..
AQ
11/18REMINDER : Akers Biosciences Schedules Conference Call to Discuss Merger with My..
BU
11/17AKERS BIOSCIENCES INVESTOR ALERT BY : Kahn Swick & Foti, LLC Investigates Merge..
BU
11/16AKERS BIOSCIENCES : Management's Discussion and Analysis of Financial Condition ..
AQ
11/13AKERS BIOSCIENCES, INC. : Other Events (form 8-K)
AQ
11/13AKERS BIOSCIENCES : Entry into a Material Definitive Agreement, Unregistered Sal..
AQ
More news
Financials (USD)
Sales 2019 1,58 M - -
Net income 2019 -3,89 M - -
Net cash 2019 9,68 M - -
P/E ratio 2019 -0,50x
Yield 2019 -
Capitalization 18,1 M 18,1 M -
EV / Sales 2018 5,19x
EV / Sales 2019 -3,83x
Nbr of Employees 12
Free-Float 75,7%
Chart AKERS BIOSCIENCES, INC.
Duration : Period :
Akers Biosciences, Inc. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends AKERS BIOSCIENCES, INC.
Short TermMid-TermLong Term
TrendsNeutralBearishBearish
Income Statement Evolution
Managers
NameTitle
Christopher C. Schreiber President & Chief Executive Officer
Joshua Nathaniel Silverman Chairman
Stuart Benson Chief Financial Officer
Bill Joe White Independent Non-Executive Director
Robert C. Schroeder Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
AKERS BIOSCIENCES, INC.-36.25%18
ABBOTT LABORATORIES24.22%184 876
MEDTRONIC PLC0.35%152 681
BECTON, DICKINSON AND COMPANY-10.74%70 408
HOYA CORPORATION23.88%46 370
ALIGN TECHNOLOGY, INC.86.97%41 138