Executive Summary / Key Takeaways

• BioVie Inc. is a clinical-stage biopharmaceutical company focused on developing novel therapies for neurodegenerative disorders (Alzheimer's, Parkinson's, Long COVID) and advanced liver disease, leveraging differentiated small molecule and peptide technologies.
• The company's lead neurodegenerative candidate, bezisterim (NE3107), targets inflammation-driven insulin resistance with a novel mechanism, positioning it as a potential disease-modifying therapy distinct from current standards of care, particularly in Parkinson's disease and Long COVID.
• Recent financial results for the nine months ended March 31, 2025, show a significant reduction in net loss and R&D expenses compared to the prior year, primarily due to the completion of major clinical trials, while simultaneously increasing investment in new studies.
• Upcoming clinical trial catalysts, including the commencement of the Phase 2 SUNRISE-PD trial (April 2025) and the DoD-funded ADDRESS-LC Long COVID trial (May 2025), represent critical near-term value inflection points for the bezisterim program.
• Despite scientific potential and operational progress on new trials, BioVie faces substantial financial risk, including a going concern warning, dependence on future financing, significant potential equity dilution, and the overhang of litigation stemming from issues in its completed Alzheimer's Phase 3 study.

A Biotech's Ambition in the Shadow of Giants

BioVie Inc. is carving out a niche in the challenging landscape of neurodegenerative and liver diseases, areas dominated by pharmaceutical behemoths. Founded in 2013, the company's strategic direction was significantly shaped by key acquisitions, first entering the liver disease space with the acquisition of LAT Pharma in 2016, bringing the BIV201 program into its pipeline. A pivotal moment arrived in June 2021 with the acquisition of NeurMedix's assets, introducing NE3107, now known as bezisterim, and establishing BioVie's focus on neurological disorders like Alzheimer's and Parkinson's.

Operating in the same therapeutic arenas as industry leaders such as Biogen (BIIB), Eli Lilly (LLY), AbbVie (ABBV), and Johnson & Johnson (JNJ), BioVie is a significantly smaller, pre-revenue entity. While these large-cap competitors boast multi-billion dollar revenues, established product portfolios, and extensive R&D budgets, BioVie differentiates itself through the unique mechanisms of action of its lead candidates. This focused approach allows BioVie to target specific biological pathways that may be underserved by broader market therapies, potentially offering distinct clinical advantages. However, BioVie's limited financial resources and dependence on external funding represent significant vulnerabilities compared to the deep pockets and robust cash flow generation of its larger rivals.

The Science Behind the Pipeline

At the heart of BioVie's neurodegenerative program is bezisterim (NE3107), an orally administered small molecule designed to inhibit inflammation-driven insulin resistance. The proposed mechanism involves inhibiting the activation of inflammatory pathways mediated by extracellular single-regulated kinase (ERK) and nuclear factor kappa-light-chain-enhancer of activated B cells (NFκB), including interactions with tumor necrosis factor (TNF) signaling. Crucially, the company posits that bezisterim achieves this without interfering with the homeostatic functions of ERK and NFκB, such as insulin signaling and neuron growth. This selective modulation of inflammation and insulin resistance represents a potentially novel approach to treating conditions like Alzheimer's and Parkinson's, where these pathways are increasingly recognized as key drivers of disease pathology.

While specific, quantifiable benefits from the AD Phase 3 trial were obscured by data integrity issues, earlier preclinical and Phase 2 data offer glimpses into bezisterim's potential. In a previous Parkinson's Phase 2 study, preclinical indications of promotoric activity and apparent enhancement of levodopa activity were observed in humans. The company's strategy hinges on translating this differentiated mechanism into tangible clinical benefits that can compete with or complement existing therapies like levodopa, which, despite providing symptomatic relief, does not slow disease progression and is associated with debilitating side effects like dyskinesia over time.

In the liver disease program, BIV201 is a continuous infusion terlipressin therapy targeting ascites in patients with advanced liver cirrhosis. BIV201 has received FDA Fast Track and Orphan Drug status, highlighting the significant unmet need in this patient population. Data from a completed Phase 2 study in refractory ascites patients appeared to show a significant reduction in ascites fluid, with at least a 30% reduction during the 28 days after treatment initiation compared to the prior 28 days, and a 53% reduction sustained at 43% over three months in patients who completed treatment. The patent-pending liquid formulation and continuous infusion method differentiate BIV201 from other potential therapies and may offer advantages in administration and efficacy.

Operational Pivot and Financial Realities

BioVie's recent financial performance reflects a strategic pivot following the completion of several key clinical trials. For the three months ended March 31, 2025, the company reported a net loss of $2.8 million, a significant decrease from the $8.1 million loss in the same period of 2024. This trend extended to the nine-month period, with a net loss of $14.1 million compared to $27.2 million in the prior year. The primary driver for this reduction in losses was a substantial decrease in research and development expenses, falling from $5.7 million to $1.3 million in the three-month comparison and from $21.0 million to $8.0 million over the nine months.

This decrease in R&D spending is directly attributed to the conclusion of large, costly trials, including the Alzheimer's Phase 3 study, the Parkinson's Phase 2 study, and the BIV201 Phase 2b study, which accounted for a $7.6 million reduction in direct study costs over the nine-month period. However, the company is actively investing in its next phase of trials, with approximately $4.0 million allocated to the planning and development of the new Sunrise PD Phase 2 and Long COVID programs during the nine months ended March 31, 2025.

Selling, general, and administrative expenses remained relatively stable over the nine-month period, with fluctuations in compensation and legal fees offsetting each other. Other income saw a net increase, benefiting from higher interest income and a decrease in the change in fair value of derivative liabilities, while interest expense declined significantly following the payoff of the company's notes payable in December 2024.

Despite the reduced burn rate reflected in the recent financials, BioVie's liquidity remains a critical factor. As of March 31, 2025, the company held $23.2 million in cash and cash equivalents and had working capital of $21.2 million. However, the company used $13.4 million in cash from operating activities during the nine months ended March 31, 2025. While financing activities provided $12.7 million during the same period, primarily through capital raises ($15.7 million) and warrant exercises ($2.9 million) offset by debt repayment, BioVie remains a pre-revenue company with a substantial accumulated deficit of $348.7 million. These circumstances lead management to conclude there is substantial doubt about the company's ability to continue as a going concern, emphasizing the critical need for future financing through equity sales, loans, or strategic transactions.

Catalysts and Challenges Ahead

The investment narrative for BioVie is heavily weighted towards upcoming clinical milestones and the company's ability to secure necessary funding. Two significant catalysts are on the horizon for the bezisterim program: the commencement of the Phase 2 SUNRISE-PD trial in April 2025 and the initiation of the DoD-funded ADDRESS-LC Long COVID trial, anticipated in May 2025. The SUNRISE-PD trial, evaluating bezisterim as a first-line therapy for new onset PD, is expected to provide topline data in late 2025 or early 2026. Success in these trials could validate bezisterim's novel mechanism and significantly de-risk the program, potentially opening up large market opportunities in areas with considerable unmet need. The BIV201 program also continues to advance, with the company finalizing the protocol design for a Phase 3 study targeting a broader ascites patient population based on recent FDA guidance.

However, the path forward is fraught with challenges. The most immediate is the need for additional capital to fund ongoing operations and clinical trials. The going concern warning underscores this financial precariousness. Future financing efforts will likely involve further equity dilution, adding to the already significant number of outstanding shares (18.56 million as of May 5, 2025) and potential shares from warrants, options, and milestone payments (totaling over 10 million potential shares as of March 31, 2025). The company's stock is also subject to Nasdaq's minimum bid price requirement; having effected a reverse stock split in August 2024, failure to maintain a $1.00 bid price before August 6, 2025, could result in delisting proceedings without a compliance period.

Adding to the uncertainty is the ongoing litigation stemming from the issues in the Alzheimer's Phase 3 trial. Shareholder class action and derivative lawsuits allege misrepresentations related to the trial data. The court's recent denial of the motion to dismiss the class action on March 27, 2025, means the case will proceed to fact discovery, introducing potential costs and distractions, although the company intends to defend vigorously. Furthermore, reliance on third parties for conducting clinical trials introduces execution risk, as delays or non-compliance by these partners could impede progress and regulatory approval timelines.

Conclusion

BioVie presents a compelling, albeit high-risk, investment proposition centered on the potential of its differentiated drug candidates, bezisterim and BIV201. The company's strategic focus on novel mechanisms targeting inflammation and insulin resistance in neurodegenerative diseases and addressing critical complications in liver cirrhosis positions it uniquely within competitive markets. The recent reduction in operating expenses, driven by trial completions, provides some temporary financial relief, while the initiation of new, potentially de-risking clinical studies represents crucial upcoming catalysts.

However, the significant financial challenges, highlighted by the going concern warning and the necessity for future capital raises, coupled with the overhang of litigation and Nasdaq listing compliance risk, temper the enthusiasm generated by the scientific potential. The success of the SUNRISE-PD and ADDRESS-LC trials, along with the ability to secure sufficient funding on favorable terms, will be paramount in determining BioVie's future trajectory and its ability to translate scientific innovation into shareholder value.