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): January 25, 2022
BIOSTAGE, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-35853 | 45-5210462 |
|
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 84 October Hill Road, Suite 11, Holliston, MA | 01746 |
| (Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: (774) 233-7300
(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 Act: None
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| N/A | N/A | N/A |
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 (§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 8.01 | Other Events. |
Litigation Update
On January 25, 2022, Biostage, Inc. (the “Company”, “we,” “our,” and “us”) issued a press release announcing that the Court hearing the Company’s dispute with its product liability insurance carrier as to the defense of a wrongful death complaint that was filed against the Company and other defendants in 2017. As further described in the release, the Court issued a Preliminary Injunction Order requiring such carrier to continue paying for the defense of the underlying litigation. Although the coverage dispute remains pending between the parties and there can be no assurance that we will ultimately prevail in such coverage litigation, the Court held that the insurance carrier will mostly likely lose its claim seeking to terminate the payment of the defense, and therefore, it must continue to pay the defense until the coverage dispute is resolved. The Court also awarded the Company its attorneys’ fees and costs arising from the carrier’s breach of the duty to defend. The Company will continue to vigorously defend against carrier’s denial of coverage and related matters, as well as continue to vigorously defend against the claims in the underlying case.
The full text of the press release is attached as Exhibit 99.1 hereto and incorporated by reference into this Item 8.01.
Webinar
On January 25, 2022, the Company also issued a press release announcing that it will be hosting two webinars to allow investors to meet its new Interim CEO, David Green. During the webinars Mr. Green will review the Company’s plans for its approved clinical trial, raising capital and uplisting to NASDAQ.
The full text of the press release, including a link to register for the webinars, is attached as Exhibit 99.2 hereto and incorporated by reference into this Item 8.01.
Forward-Looking Statements
This Current Report on Form 8-k includes statements that are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements include, but are not limited to, statements relating to the litigation matters described above, our defense of such matters and the impact of such matters, including on our financial condition and operations. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this Form 8-k, including, among other things, factors described under the heading "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 or described in the Company's other public filings. The forward-looking statements in this Form 8-k speak only as of the date of this Form 8-k. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
|
Exhibit
Number |
Title | |
| 99.1 | Press Release issued by Biostage, Inc. on January 25, 2022 | |
| 99.2 | Press Release issued by Biostage, Inc. on January 25, 2022 |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BIOSTAGE, INC. | |||
| (Registrant) | |||
| January 27, 2022 | /s/ David Green | ||
| (Date) | David Green | ||
| Interim Chief Executive Officer |
3
Exhibit 99.1
Biostage Announces Court’s Preliminary Injunction Order Requiring its Insurance Carrier to Continue Paying for Defense.
Court holds that Biostage’s insurer breached its duty to defend a litigation from the estate of a patient who died after being treated with a Biostage Tracheal Implant.
HOLLISTON, Mass., Jan. 25th, 2022 /PRNewswire/ -- Biostage, Inc. (OTCQB: BSTG) ("Biostage" or the "Company"), a cell-therapy biotechnology company with successful "first-in-human" experience in treating esophageal cancer (conducted at the Mayo Clinic and published last August) and FDA approval to commence a clinical trial of the Biostage Esophageal Implant for severe esophageal disease including cancer, today announced that a Court has ordered that its medical liability insurance carrier, Medmarc, breached its duty to defend the Company when Medmarc unilaterally stopped paying Biostage’s legal bills for the defense in the litigation from the estate of a patient who died after being treated with a Biostage Tracheal Implant. In September 2021, Medmarc filed a lawsuit seeking to be relieved of its duty to defend and indemnify Biostage in the litigation. At that time, Medmarc stopped paying the Company’s defense costs in the litigation. Biostage responded by filing claims against Medmarc for insurance coverage, and Biostage also brought a motion seeking the Court to Order Medmarc to continue paying for the Company’s reasonable defense costs in the underlying litigation while the coverage dispute is pending.
The Court granted Biostage’s motion for preliminary injunction and held that Medmarc breached its duty to defend the Company when it unilaterally stopped paying for the defense. The Court expressly stated that Medmarc engaged in “unlawful conduct” by unilaterally terminating the defense. Although the coverage dispute remains pending between the parties, the Court held that “Medmarc will mostly likely lose its claim” seeking to terminate the payment of the defense, and therefore, it must continue to pay the defense until the coverage dispute is resolved.
The Court also awarded Biostage its attorneys’ fees and costs arising from Medmarc’s breach of the duty to defend. The Court’s decision states that “when an insured goes to court and shows that the insurer has breached its duty to defend, the insured is entitled to recovery any reasonable attorneys’ fees and other litigation expenses that it incurred to do so.”
Biostage has since discontinued development of the Biostage Tracheal Implant and is now pursuing the development of the Biostage Esophageal Implant to treat adults with severe esophageal disease (including esophageal cancer), and also birth defects in the esophagus in babies.
Chairman and Interim CEO of Biostage, David Green, commented, “We are very pleased that a Court of law has ordered Medmarc to continue to pay to defend us in this litigation. This preliminary order will reduce Biostage’s cash outflows and will protect investors in Biostage by reinstating the defense in the underlying case.”
About Biostage.
Biostage is a clinical-stage biotech company that uses cell therapy to regenerate organs inside the human body to treat cancer, trauma and birth defects. We have performed the world's first regeneration of an esophagus in a human cancer patient. This surgery was performed at Mayo Clinic and was published in August 2021.
The Biostage Esophageal Implant is not a transplant of someone else’s organ. It is not a transplant of an organ grown in a pig. It is not a piece of your bowel in your chest. It is not a piece of plastic left permanently in your esophagus. The Biostage Esophageal Implant uses your own stem cells to regenerate your own organ, inside your own body. Once the regeneration is complete, and a new esophagus has formed, typically in 2-3 months, the plastic scaffold is removed via the mouth.
Biostage has 7 issued U.S. patents, 2 orphan-drug designations (which provide 7 years of market exclusivity in addition to any patents), and the possibility of 2 Priority Review Vouchers from the FDA.
Biostage's current goals include raising capital, uplisting from the OTC bulletin board to NASDAQ and beginning its clinical trial for repair of the esophagus in adults.
Forward-Looking Statements
Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements in this press release include, but are not limited to, statements relating to the capabilities and performance of our products and product candidates; our capital raising plans and expectations, including uplifting to NASDAQ; development expectations and regulatory approval of any of the Company's products, including those utilizing its Biostage Esophageal Implant technology, by the U.S. Food and Drug Administration, the European Medicines Agency or otherwise, which expectations or approvals may not be achieved or obtained on a timely basis or at all; and success with respect to any collaborations, clinical trials and other development and commercialization efforts of the Company's products, which such success may not be achieved or obtained on a timely basis or at all. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including, among other things, the Company's inability to obtain needed funds in the immediate future; the Company's ability to obtain and maintain regulatory approval for its products; plus other factors described under the heading "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 or described in the Company's other public filings. The Company's results may also be affected by factors of which the Company is not currently aware. The forward-looking statements in this press release speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.
Investor Relations Contact
Shunfu Hu
Vice President of Business Development
and Operations
774-233-7300
shu@biostage.com
Exhibit 99.2
Biostage Announces “Meet the Founder, New Chairman and Interim CEO” Webinar
Thursday, Jan. 27. 2-3pm ET via Zoom
Thursday, Jan. 27. 8-9pm ET / 9-10am Friday, January 28 Beijing Time via Zoom
HOLLISTON, Mass., Jan. 25th, 2022 /PRNewswire/ -- Biostage, Inc. (OTCQB: BSTG) ("Biostage" or the "Company"), a cell-therapy biotechnology company with successful "first-in-human" experience in treating esophageal cancer (conducted at the Mayo Clinic and published last August) and FDA approval to commence a clinical trial of the Biostage Esophageal Implant for severe esophageal disease including cancer, today announced that it will be hosting a webinar to allow investors to meet its new Interim CEO, David Green. Mr. Green is also Biostage’s founder and is the Chairman of its Board of Directors. Mr. Green will review Biostage’s plans for its approved clinical trial, raising capital and uplisting to NASDAQ. There will be an opportunity for Q&A.
The Biostage Esophageal Implant is not a transplant of someone else’s organ. It is not a transplant of an organ grown in a pig. It is not a piece of your bowel in your chest. It is not a piece of plastic left permanently in your esophagus. The Biostage Esophageal Implant uses your own stem cells to regenerate your own organ, inside your own body. Once the regeneration is complete, and a new esophagus has formed, typically in 2-3 months, the plastic scaffold is removed via the mouth.
The webinar will be held this Thursday, January 27, 2022, at 2pm ET via Zoom. There will be time for investors to ask questions directly to Mr. Green. The webinar will be repeated Thursday, Jan. 27. 8-9pm ET / 9-10am Friday, January 28 Beijing Time via Zoom.
Click here to register for the Thursday 2pm ET webinar:
https://us02web.zoom.us/webinar/register/WN_5Ig4one3QBO7NGiWZnyl1A
Click here to register for the Friday 9am Beijing Time (Thursday 8pm ET) webinar:
https://us02web.zoom.us/webinar/register/WN_0S1wpteyQHOlmwm6Me4RTA
This webinar and accompanying survey do not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation, nor this survey nor anything contained therein or herein shall form the basis of any contract or commitment whatsoever.
About Biostage.
Biostage is a clinical-stage biotech company that uses cell therapy to regenerate organs inside the human body to treat cancer, trauma and birth defects. We have performed the world's first regeneration of an esophagus in a human cancer patient. This surgery was performed at Mayo Clinic and was published in August 2021.
Biostage has 7 issued U.S. patents, 2 orphan-drug designations (which provide 7 years of market exclusivity in addition to any patents), and the possibility of 2 Priority Review Vouchers from the FDA.
Biostage's current goals include raising capital, uplisting from the OTC bulletin board to NASDAQ and beginning its clinical trial for repair of the esophagus in adults.
Forward-Looking Statements
Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements in this press release include, but are not limited to, statements relating to the capabilities and performance of our products and product candidates; our capital raising plans and expectations, including uplifting to NASDAQ; development expectations and regulatory approval of any of the Company's products, including those utilizing its Biostage Esophageal Implant technology, by the U.S. Food and Drug Administration, the European Medicines Agency or otherwise, which expectations or approvals may not be achieved or obtained on a timely basis or at all; and success with respect to any collaborations, clinical trials and other development and commercialization efforts of the Company's products, which such success may not be achieved or obtained on a timely basis or at all. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including, among other things, the Company's inability to obtain needed funds in the immediate future; the Company's ability to obtain and maintain regulatory approval for its products; plus other factors described under the heading "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 or described in the Company's other public filings. The Company's results may also be affected by factors of which the Company is not currently aware. The forward-looking statements in this press release speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.
Investor Relations Contact
Shunfu Hu
Vice President of Business Development
and Operations
774-233-7300
shu@biostage.com