DYADIC INTERNATIONAL INC
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
DYAI$0.34-0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-14.
0001437749-24-016674
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0001437749-24-026392
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 80 previous paragraphs and 78 current paragraphs.
49 unchanged; 16 reworded; 10 added; 13 removed; 2 previous and 3 current paragraphs rearranged.
Tables are not compared: 24 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
Alternative Proteins
Current report
Non-Food Applications
Current report
Food Applications
Current report
Animal Health
Current report
Human Health
Current report
Loss from operations for the three months ended June 30, 2024, decreased to $2,043,000, compared to $ 2,290,000 for the same period a year ago. The decrease in loss from operations was due to a decrease in research and development expenses of $402,000, partially offset by an increase in general and administrative expenses of $205,000.
Current report
Loss from operations for the six months ended June 30, 2024, decreased to $ 4,168,000, compared to $ 4,341,000 for the same period a year ago. The decrease in loss from operations was due to a decrease in research and development expenses of $690,000, partially offset by an increase in general and administrative expenses of $514,000.
Current report
For the three months ended June 30, 2024, total other income (expenses), net, was an expense of $3,000 compared to an income of $137,000 for the same period a year ago. The decrease in other income was due to interest expenses related to the Convertible Notes in 2024.
Current report
For thesix months ended June 30, 2024, total other income (expenses), net, was $113,000 compared to $1,232,000 for the same period a year ago. The decrease in other income was due to the gain on sale of the Company’s equity interest in Alphazyme, LLC of $1,018,000 in 2023, and interest expenses related to the Convertible Notes in 2024.
Current report
Net loss for the three months ended June 30, 2024, was $2,045,000 compared to $2,153,000 for the same period a year ago. The decrease in net loss was due to a decrease in research and development expenses of $402,000, partially offset by increases in general and administrative expenses of $205,000 and interest expenses of $141,000 in 2024.
Removed paragraphs (13)
Previous report
Corporate Events
Previous report
Human Health Sector
Previous report
DYAI-100, a C1-SARS-CoV-2 recombinant protein RBD vaccine candidate, is the first C1-expressed protein tested in humans. The Phase 1 randomized, double-blind, placebo-controlled trial was designed as a first-in-human trial to assess the clinical safety and antibody response of DYAI-100, produced using the C1 platform and administered as a booster vaccine at two single dose levels in healthy volunteers. Following regulatory clearance from the South African Health Products Regulatory Authority (SAHPRA), the trial was initiated in 1Q 2023, with the last patient visit occurring in 3Q 2023. On November 29, 2023, the Company announced the top-line safety results, indicating that the study has met its primary endpoint that both the low and high dose levels of the vaccine are safe and well tolerated among participants. Additionally, the vaccine has been shown to induce immune responses at both dose levels, suggesting its potential efficacy in generating protective immunity against the target virus. The study has been finalized, and the final Clinical Study Report has been issued, demonstrating that the DYAI-100 vaccine met its primary endpoint of safety and reactogenicity.
Previous report
Animal Health Sector
Previous report
Alternative Proteins Sector
Previous report
Dyadic is advancing a pipeline of differentiated product candidates that leverage its microbial protein production platforms, including Dapibus™ which have demonstrated the ability and efficiency to enable the rapid development and large-scale manufacture of proteins at low cost in a wide range of non-pharmaceutical applications and commercial use.
Previous report
Cell Culture Media Products
Previous report
Non-animal Dairy Products
Previous report
For thethree months ended March 31, 2024, other income (expenses), net, was $116,000 compared to $1,094,000 for the same period a year ago. Other income in 2024 was derived from interest income from investment securities and the earn-out from the sale of the Company’s equity interest in Alphazyme, LLC., and interest expenses were related to the Convertible Notes. Other income in 2023 was derived from interest income from investment securities and sale of the Company’s equity interest in Alphazyme, LLC for $989,000.
Previous report
Loss from operations for the three months ended March 31, 2024, slightly increased to $2,126,000, compared to $2,050,000 for the same period a year ago.
Previous report
Our primary source of cash to date has been the cash received from the DuPont Transaction in 2015, interest income received from investment grade securities, revenues from our research collaboration agreements and license agreements, the issuance of Senior Secured Convertible Promissory Note, and funds from the exercise of employee stock options.
Previous report
Our ability to achieve profitability depends on many factors, including our scientific results and our ability to continue to obtain funded research and development collaborations from industry and government programs, as well as sub-license agreements. We may continue to incur substantial operating losses even if we begin to generate revenues from research and development and licensing. Our primary future cash needs are expected to be for general operating activities, including our business development and research expenses, as well as legal and administrative costs as an SEC reporting and NASDAQ listed company. Our future cash requirements will depend on many factors, including those factors discussed under Item 1A. Risk Factors of Annual Report.
Previous report
Net cash used in investing activities for thethree months ended March 31, 2024 was $0.7 million, which was attributable to purchases of investment securities of $1.6 million, offset by proceeds from maturities of investment securities of $0.9 millionand the earn-out from the sale of equity interest in Alphazyme, LLC of $61,000.
Reworded paragraphs (16)
Previous wording
On December 31, 2015, the Company sold its industrial technology business to Danisco USA (“Danisco”), the industrial biosciences business of DuPont (NYSE: DD) (the “DuPont Transaction”). As part of the DuPont Transaction, Dyadic retained co-exclusive rights to the C1-cell protein production platform for use in all human and animal pharmaceutical applications, and currently the Company has the exclusive ability to enter into sub-license agreements (subject to the terms of the license and to certain exceptions) for use in all human and animal pharmaceutical applications. Danisco retained certain rights to utilize the C1-cell protein production platform in pharmaceutical applications, including the development and production of pharmaceutical products, for which it will be required to make royalty payments to Dyadic upon commercialization. In certain circumstances, Dyadic may owe a royalty to either Danisco or certain licensors of Danisco, depending upon whether Dyadic elects to utilize certain patents either owned by Danisco or licensed in by Danisco.
Current wording
On December 31, 2015, the Company sold its industrial technology business to Danisco USA (“Danisco”), the industrial biosciences business of DuPont (NYSE: DD) (the “DuPont Transaction”). As part of the DuPont Transaction, Dyadic retained co-exclusive rights to the C1-cell protein production platform for use in all human and animal pharmaceutical applications, and currently the Company has the exclusive ability to enter into sub-license agreements (subject to the terms of the license and to certain exceptions) for use in all human and animal pharmaceutical applications. Danisco retained certain rights to utilize the C1-cell protein production platform in pharmaceutical applications, including the development and production of pharmaceutical products, for which it will be required to make royalty payments to Dyadic upon commercialization. After December 31, 2029, Danisco will have certain rights to sublicense C1 technology to third parties for which the Company will be entitled to receive royalties on such pharmaceutical products for a certain period of time. In certain circumstances, Dyadic may owe a royalty to either Danisco or certain licensors of Danisco, depending upon whether Dyadic elects to utilize certain patents either owned by Danisco or licensed in by Danisco.
Previous wording
Three Months Ended March 31, 2024 Compared to the Same Period in 2023
Current wording
Three and Six Months Ended June 30, 2024 Compared to the Same Periods in 2023
Previous wording
The following table summarizes the Company’s revenue and cost of research and development revenue for the three months ended March 31, 2024 and 2023:
Current wording
The following table summarizes the Company’s revenue and cost of research and development revenue for the three and six months ended June 30, 2024 and 2023:
Previous wording
For the three months ended March 31, 2024, the decrease in research and development revenue and cost of research and development revenue was due to the winding down of several large research collaborations conducted in 2023. For the three months ended March 31, 2024, the Company’s revenue was generated from ten collaborations compared to seven collaborations in the same period a year ago. The license revenue for the three months ended March 31, 2023, was related to the Janssen license agreements.
Current wording
For the three and six months ended June 30, 2024, the decrease in research and development revenue and cost of research and development revenue was due to the winding down of several large research collaborations conducted in 2023. For the three months ended June 30, 2024, the Company’s revenue was generated from ten collaborations compared to eight collaborations for the same period a year ago. For thesix months ended June 30, 2024, the decrease in research and development revenue and cost of research and development revenue was due to the winding down of several large research collaborations conducted in 2023. For thesix months ended June 30, 2024, the Company’s revenue was generated from thirteen collaborations compared to eight collaborations for the same period a year ago.
Previous wording
Research and development expenses for thethree months ended March 31, 2024, decreased to $523,000 compared to $811,000 for the same period a year ago. The decrease reflected the winding down of activities related to the Company’s Phase 1 clinical trial of DYAI- 100 COVID-19 vaccine candidate as patient dosing was completed in February 2023 and a decrease in the amount of ongoing internal research projects.
Current wording
Research and development expenses for thethree months ended June 30, 2024, decreased to $516,000 compared to $918,000 for the same period a year ago. The decrease reflected the winding down of activities related to the Company’s Phase 1 clinical trial of DYAI-100 COVID-19 vaccine candidate as patient dosing was completed in February 2023 and a decrease in the amount of ongoing internal research projects.
Previous wording
General and administrative expenses for the three months ended March 31, 2024, increased by 20.9% to $1,789,000 compared to $1,480,000 for the same period a year ago. The increase reflected increases in business development and investor relations expenses of $138,000, audit fees of $99,000, management incentives of $59,000, and other increases of $59,000, offset by decreases in insurance expenses of $29,000 and legal expenses of $17,000.
Current wording
General and administrative expenses for the three months ended June 30, 2024, increased by 14.6% to $1,608,000 compared to $1,403,000 for the same period a year ago. The increase reflected increases in share-based compensation expenses of $84,000, legal expenses of $81,000, business development and investor relations expenses of $60,000, and other increases of $22,000, offset by decreases in management incentives of $36,000, and insurance expenses of $6,000.
Previous wording
Net loss for the three months ended March 31, 2024, was $2,010,000 compared to $956,000 for the same period a year ago. The increase in net loss was derived from the sale of the Company’s equity interest in Alphazyme LLC for $989,000 in 2023.
Current wording
Net loss for the six months ended June 30, 2024, was $4,055,000 compared to $3,109,000 for the same period a year ago. The decrease in net loss was due to a decrease in the gain on sale of the Company’s equity interest in Alphazyme LLC of $957,000 and research and development expenses of $690,000, partially offset by increases in general and administrative expenses of $514,000 and interest expenses of $174,000.
Previous wording
As of March 31, 2024, we had an accumulated deficit of $82.3 million. We expect to incur losses and have negative net cash flows from operating activities as we continue developing our microbial platforms and related products, and as we expand our pipeline and engage in further research and development activities for internal products as well as for our third-party collaborators and licensees. The success of the Company depends on its ability to develop its technologies and products to the point of regulatory approval and subsequent revenue generation or through sublicensing of the Company’s technologies and products, and its ability to raise capital to finance these developmental efforts.
Current wording
The Company expects to incur losses and have negative net cash flows from operating activities as it continues developing its microbial platforms and related products, and as it expands its pipelines and engages in further research and development activities for internal products as well as for its third-party collaborators and licensees. The success of the Company depends on its ability to develop its technologies and products to the point of regulatory approval and subsequent revenue generation or through the sublicensing of the Company’s technologies and products, and its ability to raise capital to finance these developmental efforts.
Previous wording
On March 8, 2024, the Company issued an aggregate principal amount of $6.0 million of its 8.0% Senior Secured Convertible Promissory Notes due March 8, 2027 (the “Convertible Notes”) in a private placement in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). The purchasers of the Convertible Notes include immediate family members and family trusts related to Mark Emalfarb, our President and Chief Executive Officer and a member of our Board of Directors, including The Francisco Trust, an existing holder of more than 5% of the Company’s outstanding common stock, (collectively, the “Purchasers”). The net proceeds from the sale of the Convertible Notes, after deducting offering expenses, are $5,824,000. The Company intends to use the net proceeds from the offering of the Convertible Notes for working capital and general corporate purposes.
Current wording
On March 8, 2024, the Company issued an aggregate principal amount of $6.0 million of its 8.0% Senior Secured Convertible Promissory Notes due March 8, 2027 (the “Convertible Notes”) in a private placement in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). The purchasers of the Convertible Notes include immediate family members and family trusts related to Mark Emalfarb, our President and Chief Executive Officer and a member of our Board of Directors, including The Francisco Trust, an existing holder of more than 5% of the Company’s outstanding common stock, (collectively, the “Purchasers”). The net proceeds from the sale of the Convertible Notes, after deducting offering expenses, is $5,824,000. The Company intends to use the net proceeds from the offering of the Convertible Notes for working capital and general corporate purposes. This private placement funding is expected to support our near-term revenue growth and accelerate our strategic objective of commercialization opportunities for pharmaceutical and non-pharmaceutical applications.
Previous wording
The Convertible Notes can be converted into shares of Dyadic’s Class A common stock (the “Common Stock”), at the option of the holders of the Convertible Notes (the “Noteholders”) at any time prior to the Maturity Date. The conversion price is $1.79 per share of the Common Stock, which is equal to 125% of the trailing 30-day VWAP of the Common Stock ending on the trading day immediately preceding the date of the securities purchase agreement. For more information regarding the Convertible Notes, including the covenants related thereto see Note 8 to the Consolidated Financial Statements.
Current wording
The Convertible Notes can be converted into shares of Dyadic’s Class A common stock (the “Common Stock”), at the option of the holders of the Convertible Notes (the “Noteholders”) at any time prior to the Maturity Date. The conversion price is $1.79 per share of the Common Stock, which is equal to 125% of the trailing 30-day VWAP of the Common Stock ending on the trading day immediately preceding the date of the securities purchase agreement. As of June 30, 2024, $400,000 of the Convertible Notes were converted into 223.463 shares of Common Stock. For more information regarding the Convertible Notes, see Note 4 to the Consolidated Financial Statements.
Previous wording
We expect our existing cash and cash equivalents and cash raised from the Convertible Notes, investments in debt securities, and operating cash flows will be sufficient to meet our operational, business, and other liquidity requirements for at least the next twelve (12) months from the date of issuance of the financial statements contained in this Quarterly Report. However, we have based this estimate on assumptions that may prove to be wrong, and our operating plan may change because of many factors currently unknown. In the event our financing needs are not able to be met by our existing cash, cash equivalents and investments, we would seek to raise additional capital through strategic financial opportunities that could include, but are not limited to, future public or private equity offerings, collaboration agreements, and/or other means. Any amounts raised may be used for the further development and commercialization of product candidates, and for other working capital purposes. There is no guarantee that any of these strategic or financing opportunities will be executed or realized on favorable terms, if at all, and some could be dilutive to existing shareholders.
Current wording
The Company expects its existing cash and cash equivalents and cash raised from the Convertible Notes, investments in debt securities, and operating cash flows from its existing and future license agreement(s) will be sufficient to meet its operational, business, and other liquidity requirements for at least the next twelve (12) months from the date of issuance of the financial statements contained in this Quarterly Report. However, the Company has based this estimate on assumptions that may prove to be wrong, and its operating plan may change as a result of many factors currently unknown to it. In the event our financing needs are not able to be met by our existing cash, cash equivalents and investments, we would seek to raise additional capital through strategic financial opportunities that could include, but are not limited to, future public or private equity offerings, collaboration agreements, and/or other means. Any amounts raised may be used for the further development and commercialization of product candidates, and for other working capital purposes. There is no guarantee that any of these strategic or financing opportunities will be executed or realized on favorable terms, if at all, and some could be dilutive to existing shareholders.
Previous wording
As of March 31, 2024, cash and cash equivalents were$10.6 million compared to$6.5 million as of December 31, 2023. The carrying value of investment grade securities, including accrued interest as of March 31, 2024, was$1.5 million compared to$0.8 million as of December 31, 2023.
Current wording
As of June 30, 2024, cash and cash equivalents were$6.1 million compared to$6.5 million as of December 31, 2023. The carrying value of investment grade securities, including accrued interest as of June 30, 2024, was$4.0 million compared to$0.8 million as of December 31, 2023.
Previous wording
Net cash used in operating activities for thethree months ended March 31, 2024 was $1.1 million, which was principally attributable to a net loss of $2.0 million, partially offset by changes in operating assets and liabilities of $0.7 million and share-based compensation expenses of $0.3 million.
Current wording
Net cash used in operating activities for thesix months ended June 30, 2024 was $3.1 million, which was principally attributable to a net loss of $4.0 million, partially offset by changes in operating assets and liabilities of $0.4 million and share-based compensation expenses of $0.6 million.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2023 was $2.2 million, which was principally attributable to a net loss of $1.0 million, gain from the sale of investment in Alphazyme, LLC of $1.0 million, and changes in operating assets and liabilities of $0.6 million, partially offset by share-based compensation expenses of $0.3 million.
Current wording
Net cash used in operating activities for the six months ended June 30, 2023, was$3.8 million, which was principally attributable to a net loss of $3.1 million, gain from the sale of investment in Alphazyme, LLC of approximately $1.0 million, and changes in operating assets and liabilities of $0.4 million, partially offset by share-based compensation expenses of approximately $0.7 million.
Previous wording
Net cash provided byinvesting activities for the three months ended March 31, 2023 was$2.8 million, which was related to proceeds from maturities of investment securities of $2.2 million, proceeds from the sale of equity interest in Alphazyme, LLC of $1.3 million, offset by purchases of investment securities of $0.7 million.
Current wording
Net cash used in investing activities for thesix months ended June 30, 2024 was $3.1 million, compared to a net cash provided by investing activities of $3.8 for the six months ended June 30, 2023. The increase in net cash used in investing activities was attributable to additional purchases of investment securities of $2.7 million, decreases in proceeds received from maturities of investment securities of $3.1 million, and proceeds from the sale of investment in Alphazyme of $1.3 million.
Previous wording
Net cash provided by financing activitiesfor thethree months ended March 31, 2024 was $5.8 million, which was related to net proceeds from issuance of convertible notes. For thethree months ended March 31, 2023, there were no cash flows from financing activities.
Current wording
Net cash provided by financing activitiesfor thesix months ended June 30, 2024 was $5.8 million, which was related to net proceeds from issuance of convertible notes. For thesix months ended June 30, 2023, there were no cash flows from financing activities.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
The license revenue for the three and six months ended June 30, 2023, was related to the Janssen license agreement, which was completed in December 2023.
Current report — wording carried from elsewhere
Research and development expenses for thesix months ended June 30, 2024, decreased to $1,038,000 compared to $1,728,000 for the same period a year ago. The decrease reflected the winding down of activities related to the Company’s Phase 1 clinical trial of DYAI-100 COVID-19 vaccine candidate as patient dosing was completed in February 2023 and a decrease in the amount of ongoing internal research projects.
Current report — wording carried from elsewhere
General and administrative expenses for thesix months ended June 30, 2024, increased by 17.8% to $3,396,000 compared to $2,883,000 for the same period a year ago. The increase reflected increases in business development and investor relations expenses of $296,000, share-based compensation expenses of $87,000, legal expenses of $64,000, management incentives of $19,000, and other increases of $82,000, offset by decrease in insurance expenses of $35,000.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
DYAI-100 Phase 1 Clinical Trial
Previous report — wording carried elsewhere
This private placement funding strengthened our financial position, and it will support our near-term revenue growth and accelerate our strategic objective of commercialization opportunities for pharmaceutical and non-pharmaceutical applications.