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What changed in BioNexus Gene Lab Corp's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of BioNexus Gene Lab Corp's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+325 added−280 removedSource: 10-K (2024-04-16) vs 10-K (2023-03-31)

Top changes in BioNexus Gene Lab Corp's 2023 10-K

325 paragraphs added · 280 removed · 230 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

37 edited+35 added−20 removed38 unchanged
Biggest changeF-5 Table of Contents BIONEXUS GENE LAB CORP CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) Common stock Number of shares Amount Additional paid in capital Accumulated surplus Accumulated other comprehensive income/ (loss) Total Equity Balance as of January 1, 2021 171,218,152 $ 10,779,574 $ (5,011,891 ) $ 760,787 $ 133,684 $ 6,662,154 Net profit for the year - - - 751,571 - 751,571 Foreign currency translation loss - - - - (233,946 ) (233,946 ) Balance as of December 31, 2021 171,218,152 $ 10,779,574 $ (5,011,891 ) $ 1,512,358 $ (100,262 ) $ 7,179,779 Issuance of shares 2,500,000 150,000 150,000 Net loss for the year - - - (355,966 ) - (355,966 ) Foreign currency translation loss - - - - (308,800 ) (308,800 ) Balance as of December 31, 2022 173,718,152 $ 10,929,574 $ (5,011,891 ) $ 1,156,392 $ (409,062 ) $ 6,665,013 See accompanying notes to the consolidated financial statements.
Biggest changeF-6 BIONEXUS GENE LAB CORP CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) Common stock Accumulated Additional other Number of paid in Accumulated comprehensive Total shares Amount capital surplus loss Equity Balance as of January 1, 2022 14,268,180 $ 10,779,574 $ (5,011,891 ) $ 1,512,358 $ (100,262 ) $ 7,179,779 Issuance of shares 208,333 150,000 - - - 150,000 Net loss for the year - - - (355,966 ) - (355,966 ) Foreign currency translation loss - - - - (308,800 ) (308,800 ) Balance as of December 31, 2022 14,476,513 $ 10,929,574 $ (5,011,891 ) $ 1,156,392 $ (409,062 ) $ 6,665,013 Impacts arising from application of Topic 326 - - - (371,627 ) - (371,627 ) Balance as of January 1, 2022 (restated) 14,476,513 $ 10,929,574 $ (5,011,891 ) $ 784,765 $ (409,062 ) $ 6,293,386 Round up shares 1,044,351 1,046 - - - 1,046 Issuance of shares* 1,437,500 5,750,000 - - - 5,750,000 Issuance of shares# 709,299 510,695 - - - 510,695 Net loss for the year - - - (2,629,043 ) - (2,629,043 ) Foreign currency translation loss - - - - (268,232 ) (268,232 ) Balance as of December 31, 2023 17,667,663 $ 17,191,315 $ (5,011,891 ) $ (1,844,278 ) $ (677,294 ) $ 9,657,852 Share activity (number of shares or both number and amount of shares) has been adjusted for the periods shown to reflect the 12-for-1 reverse stock split effected on July 20, 2023, on a retroactive basis as described in Note 10. * 1,437,500 shares of common stock were issued to underwriter. # 834,299 shares of common stock were issued to professional parties, subsequently 125,000 shares of common stock were cancelled during the year.
Management reviews the adequacy of the allowance for impairment on an ongoing basis, using historical collection trends and aging of receivables. Management also periodically evaluates individual customer’s financial condition, credit history, and the current economic conditions to adjust in the allowance when it is considered necessary.
Management reviews the adequacy of the allowance for impairment on an ongoing basis, using historical collection trends and aging of receivables. Management also periodically evaluates individual customer’s financial condition, credit history, and current economic conditions to adjust in the allowance when it is considered necessary.
The principal annual rates used are as follows: Categories Principal Annual Rates Air conditioner 20 % Buildings 2 % Computer and software 33 % Equipment 20 % Furniture and fittings 10% to 20 % Lab Equipment 10 % Motor vehicle 10% to 20 % Office equipment 20 % Renovation 10% to 20 % Signboard 10 % Leasehold lands are depreciated over the period of lease term.
The principal annual rates used are as follows: Principal Categories Annual Rates Air conditioner 20 % Buildings 2 % Computer and software 33 % Equipment 20 % Furniture and fittings 10% to 20 % Lab Equipment 10 % Motor vehicle 10% to 20 % Office equipment 20 % Renovation 10% to 20 % Signboard 10 % Leasehold lands are depreciated over the period of lease term.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying consolidated financial statements and notes. ☐ Basis of presentation The accompanying consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). ☐ Basis of consolidation The consolidated financial statements include the accounts of Bionexus Gene Lab Corp. and its subsidiaries.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying consolidated financial statements and notes. ☐ Basis of presentation The accompanying consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). ☐ Basis of consolidation The consolidated financial statements include the accounts of Bionexus Gene Lab Corp. and its subsidiaries.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Related parties Parties, which can be a corporation or individual, are related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Related parties Parties, which can be a corporation or individual, are related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 4 – INCOME TAXES The Company provides for income taxes under ASC 740, “Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 4 – INCOME TAXES The Company provides for income taxes under ASC 740, “Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Impairment of long-lived assets Long-lived assets primarily include goodwill, intangible assets and property, plant and equipment.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Impairment of long-lived assets Long-lived assets primarily include goodwill, intangible assets and property, plant and equipment.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Leases Prior to January 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) ☐ Leases Prior to January 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases.
When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place. Fully depreciated plant and equipment are retained in the financial statements until they are no longer in use. F-11 Table of Contents BIONEXUS GENE LAB CORP.
When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place. Fully depreciated plant and equipment are retained in the financial statements until they are no longer in use. F-12 BIONEXUS GENE LAB CORP.
This comprehensive income is not included in the computation of income tax expense or benefit. ☐ Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “ Income Taxes ” (“ASC Topic 740”).
This comprehensive income is not included in the computation of income tax expense or benefit. ☐ Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”).
On August 23, 2017, the Company acquired all the outstanding capital stock of BGS Lab Sdn. Bhd., a Malaysian corporation (“BioNexus Malaysia”). BioNexus Malaysia was incorporated in Malaysia on April 7, 2015 which it then subsequently changed its name to Bionexus Gene Lab Sdn. Bhd.
On August 23, 2017, the Company acquired all the outstanding capital stock of Bionexus Gene Lab Sdn. Bhd., a Malaysian corporation (“BioNexus Malaysia”) MRNA Scientific Malaysia was incorporated in Malaysia on April 7, 2015 which it then subsequently changed its name to MRNA Scientific Sdn. Bhd. (MRNA Scientific). on September 19, 2023.
F-8 Table of Contents BIONEXUS GENE LAB CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 1 – ORGANIZATION AND BUSINESS BACKGROUND BioNexus Gene Lab Corp. was incorporated in the State of Wyoming on May 12, 2017.
F-9 BIONEXUS GENE LAB CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 1 – ORGANIZATION AND BUSINESS BACKGROUND BioNexus Gene Lab Corp. (the “Company”) was incorporated in the State of Wyoming on May 12, 2017.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclosed in their financial statements uncertain tax positions taken or expected to be taken on a tax return.
F-13 BIONEXUS GENE LAB CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclosed in their financial statements uncertain tax positions taken or expected to be taken on a tax return.
Write downs are recorded in cost of revenues in the Statement of Operations and Comprehensive Income. F-10 Table of Contents BIONEXUS GENE LAB CORP.
Write downs are recorded in cost of revenues in the Statement of Operations and Comprehensive Income. F-11 BIONEXUS GENE LAB CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 5 – OPERATING LEASE RIGHT OF USE ASSET AND LEASE LIABILITIES Lease liabilities are measured at present value of the sum of remaining rental payment as of recognition with discount rate of 6.40% per annum adopted from Malayan Banking (Maybank) Berhad's base rate as a reference for discount rate, as this bank is the largest bank and national bank of Malaysia.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 5 – OPERATING LEASE RIGHT OF USE ASSET AND LEASE LIABILITIES Right-of-use assets and lease liabilities are measured at present value of the lease payment over the lease term as of recognition with discount rate of 6.40% per annum effective date and 6.65% per annum effective date initial recognized date adopted from Malayan Banking (Maybank) Berhad's base rate as a reference for the discount rate, as this bank is the largest bank and national bank of Malaysia.
Malaysia BioNexus Malaysia and Chemrex are both subject to Malaysia Corporate Tax, which is charged at the statutory income tax rate range is 24% on its assessable income.
Malaysia MRNA Scientific Malaysia and Chemrex are both subject to Malaysia Corporate Tax, which is charged at the statutory income tax rate range from 15% to 24% on its assessable income.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) Other information: As of As of December 31, 2022 December 31, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flow from operating leases $ (126,686 ) $ (20,169 ) Right of use assets obtained in exchange for operating lease liabilities 55,730 41,090 Remaining lease term for operating leases (years) 4 2 Weighted average discount rate for operating leases $ 6.40 % $ 5.40 % Lease expenses for the year ended December 31, 2022 and 2021 were $4,913 and $2,704 respectively.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) Other information: As of As of December 31, December 31, Cash paid for amounts included in the measurement of lease liabilities: 2023 2022 Operating cash flow from operating leases $ 76,620 $ (126,686 ) Right of use assets obtained in exchange for operating lease liabilities 141,544 55,730 Remaining lease term for operating leases (years) 4.5 4 Weighted average discount rate for operating leases $ 6.53 % $ 6.40 % Lease expenses for the year ended December 31, 2023 and 2022 were $5,613 and $4,913 respectively.
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) As of Note December 31, 2022 December 31, 2021 STOCKHOLDERS’ EQUITY As at December 31, 2022, common stock, no par value; 300,000,000 shares authorized and 173,718,152 shares outstanding, and preferred stock, no par value; 30,000,000 shares authorized and no shares outstanding.
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) As of December 31, December 31, Note 2023 2022 STOCKHOLDERS’ EQUITY As at December 31, 2023, common stock, no par value; 300,000,000 shares authorized and 17,667,663 shares outstanding, and preferred stock, no par value; 30,000,000 shares authorized and no shares outstanding.
ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows: · Level 1 : Observable inputs such as quoted prices in active markets; · Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and · Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions As of December 31, 2022, and December 31, 2021, the Company did not have any non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements, at least annually, on a recurring basis, nor did the Company have any assets or liabilities measured at fair value on a non-recurring basis. ☐ Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.
ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows: · Level 1 : Observable inputs such as quoted prices in active markets; · Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and · Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions As of December 31, 2023, and December 31, 2022, the Company did not have any non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements, at least annually, on a recurring basis, nor did the Company have any assets or liabilities measured at fair value on a non-recurring basis. ☐ Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. ☐ Recently Adopted Accounting Standards In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology.
Translation of amounts from RM (MYR) into US$1.00 has been made at the following exchange rates for the respective years: December 31, 2022 December 31, 2021 Year-end US$1.00: MYR exchange rate 4.3900 4.1650 January 1, 2022 to December 31, 2022 January 1, 2021 to December 31, 2021 Yearly average US$1.00: MYR exchange rate 4.3996 4.1456 F-13 Table of Contents BIONEXUS GENE LAB CORP.
Translation of amounts from RM (MYR) into US$1.00 has been made at the following exchange rates for the respective years: December 31, December 31, 2023 2022 Year-end US$1.00: MYR exchange rate 4.5900 4.3900 January 1, January 1, 2023 to 2022 to December 31, December 31, 2023 2022 Yearly average US$1.00: MYR exchange rate 4.5658 4.3996 F-14 BIONEXUS GENE LAB CORP.
NOTE 11 – SEGMENTED INFORMATION At December 31, 2022, the Company (“BGLC”) operates in the biochemical industry segment through its two Malaysian subsidiaries, BioNexus Malaysia and Chemrex. BioNexus Gene Lab Corp. a Wyoming company 100% owned Bionexus Gene Lab Sdn. Bhd., a Malaysian company 100% owned Chemrex Corporation Sdn.
NOTE 11 – SEGMENTED INFORMATION At December 31, 2023, the Company (“BGLC”) operates in the biochemical industry segment through its two Malaysian subsidiaries, MRNA Scientific Malaysia (formerly known as Bionexus Gene Lab Sdn. Bhd.) and Chemrex. BioNexus Gene Lab Corp. a Wyoming company 100% owned MRNA Scientific Sdn. Bhd. (formerly “Bionexus Gene Lab Sdn.
Actual results may differ from these estimates. ☐ Cash and cash equivalents Cash and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. ☐ Trade receivables Trade receivables are recorded at the invoiced amount and do not bear interest.
Actual results may differ from these estimates. ☐ Cash and cash equivalents Cash and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. ☐ Trade receivables Trade receivables were recorded at the invoiced amount and Chemrex did charge interest to certain debtors with overdue outstanding.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”))(CONT’D) (Audited) CASH AND CASH EQUIVALENTS INFORMATION: Fixed deposits placed with financial institutions $ 1,507,015 $ 1,545,408 Cash and bank balances 611,849 578,511 Cash and cash equivalents, end of financial year 2,118,864 2,123,919 Supplementary cash flow information: Interest paid $ (12,479 ) $ (12,973 ) Income tax paid (170,447 ) (226,770 ) See accompanying notes to the consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”))(CONT’D) (Audited) CASH AND CASH EQUIVALENTS INFORMATION: Fixed deposits placed with financial institutions $ 3,305,371 $ 1,507,015 Cash and bank balances 2,623,965 611,849 Cash and cash equivalents, end of financial year 5,929,336 2,118,864 Supplementary cash flow information: Interest paid $ (13,929 ) $ (12,479 ) Income tax refunded 312 - Income tax paid (66,973 ) (170,447 ) See accompanying notes to the consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 7 – OTHER INVESTMENTS As of As of December 31, 2022 December 31, 2021 As of beginning of the year $ 749,027 $ 281,668 Acquisition of business under common control - - Addition during the year 511,706 515,840 Disposal during the year - (6,392 ) Written off during the year (1,776 ) - Fair value gain (70,628 ) (29,850 ) Foreign exchange translation (37,431 ) (12,239 ) As of end of the year $ 1,150,898 $ 749,027 The other investments consist of the following shares: As of December 31, December 31, 2022 2021 Investment in quoted shares: Malaysia 659,970 590,788 Singapore 101,426 97,780 Hong Kong 389,502 58,584 $ 1,150,898 $ 747,152 Investment in unquoted shares: Malaysia - 1,875 $ 1,150,898 $ 749,027 NOTE 8 – TRADE PAYABLES Trade payables are amounts billed to the Company by suppliers for goods and services in the ordinary course of business.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 7 – OTHER INVESTMENTS As of As of December 31, December 31, 2023 2022 As of beginning of the year $ 1,150,898 $ 749,027 Addition during the year 320,733 511,706 Disposal during the year (26,146 ) - Written off during the year - (1,776 ) Fair value gain 313,859 (70,628 ) Impairment on other investment (6,194 ) - Foreign exchange translation (53,319 ) (37,431 ) As of end of the year $ 1,699,831 $ 1,150,898 The other investments consist of the following shares: As of December 31, December 31, Investment in quoted shares: 2023 2022 Malaysia 1,138,863 659,970 Singapore 79,577 101,426 Hong Kong 481,391 389,502 $ 1,699,831 $ 1,150,898 NOTE 8 – TRADE PAYABLES Trade payables are amounts billed to the Company by suppliers for goods and services in the ordinary course of business.
Bhd., a Malaysian company F-19 Table of Contents BIONEXUS GENE LAB CORP.
Bhd., a Malaysian Company F-10 BIONEXUS GENE LAB CORP.
As of December 31, 2022 and 2021 operating lease right of use assets as follows: As of As of December 31, 2022 December 31, 2021 Balance as of December 31, 2021 $ 41,090 $ 62,529 Add: Addition of right of use assets 32,281 - Reduction due to discount on rental - (913 ) Less: accumulated amortization (15,534 ) (18,305 ) Foreign translation differences (2,107 ) (2,221 ) Balance as of December 31, 2022 $ 55,730 $ 41,090 As of December 31, 2022 and 2021 operating lease liabilities as follows: As of As of December 31, 2022 December 31, 2021 Balance as of beginning of the year $ 42,909 $ 63,079 Add: Addition of lease liabilities 30,770 - Less: Discount on rental - (972 ) Less: gross repayment (19,618 ) (16,856 ) Add: imputed interest 4,913 2,704 Foreign translation differences (2,199 ) (5,046 ) Balance as of end of the year 56,775 42,909 Less: lease liabilities current portion (16,569 ) (18,272 ) Lease liabilities non-current portion $ 40,206 $ 24,637 As of December 31, 2022 and 2021, the maturities of the operating lease obligation are as follows: As of As of Years ending December 31: December 31, 2022 December 31, 2021 2022 - 18,272 2023 16,569 11,987 2024 17,048 12,650 2025 11,209 - 2026 11,949 - Total $ 56,775 $ 42,909 The amortization of the operating lease right of use asset for the year ended December 31, 2022 and 2021 were $13,992 and $16,933, respectively.
As of December 31, 2023 and 2022 operating lease right of use assets as follows: As of As of December 31, December 31, 2023 2022 Balance as of December 31, 2022 $ 55,730 $ 41,090 Add: Addition of right of use assets 113,279 32,281 Less: accumulated amortization (25,038 ) (15,534 ) Foreign translation differences (2,428 ) (2,107 ) Balance as of December 31, 2023 $ 141,544 $ 55,730 As of December 31, 2023 and 2022 operating lease liabilities as follows: As of As of December 31, December 31, 2023 2022 Balance as of beginning of the year $ 56,775 $ 42,909 Add: Addition of lease liabilities 113,279 30,770 Less: gross repayment (39,798 ) (19,618 ) Add: imputed interest 5,613 4,913 Foreign translation differences (2,474 ) (2,199 ) Balance as of end of the year 133,395 56,775 Less: lease liabilities current portion (34,632 ) (16,569 ) Lease liabilities non-current portion $ 98,763 $ 40,206 As of December 31, 2023 and 2022, the maturities of the operating lease obligation are as follows: As of As of December 31, December 31, Years ending December 31: 2023 2022 2023 - 16,569 2024 34,632 17,048 2025 30,304 11,209 2026 32,353 11,949 2027 22,361 - 2028 13,745 - Total $ 133,395 $ 56,775 The amortization of the operating lease right of use asset for the year ended December 31, 2023 and 2022 were $25,170 and $13,992, respectively.
NOTE 6 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following: As of December 31, 2022 December 31, 2021 Air conditioner $ 1,124 $ 1,124 Computer and software 2,516 1,814 Equipment 60,525 43,010 Furniture and fittings 87,122 86,961 Lab equipment 320,102 284,822 Land and buildings 1,506,969 1,506,969 Motor vehicle 137,914 137,914 Office equipment 38,213 37,700 Renovation 107,414 107,414 Signboard 704 704 2,262,603 2,208,432 (Less): Accumulated depreciation (616,913 ) (525,631 ) Add: Foreign translation differences (133,982 ) (48,383 ) Property, plant and equipment, net $ 1,511,708 $ 1,634,418 During the year ended December 31, 2022 and 2021, the Company recorded depreciation of $91,427 and $91,282, respectively.
NOTE 6 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following: As of December 31, December 31, 2023 2022 Air conditioner $ 1,124 $ 1,124 Computer and software 3,923 2,516 Equipment 60,412 60,525 Furniture and fittings 100,118 87,122 Lab equipment 320,102 320,102 Land and buildings 1,506,969 1,506,969 Motor vehicle 161,148 137,914 Office equipment 33,914 38,213 Renovation 98,597 107,414 Signboard 806 704 Capital Work In Progress 109,509 - 2,396,622 2,262,603 (Less): Accumulated depreciation (659,115 ) (616,913 ) Add: Foreign translation differences (225,889 ) (133,982 ) Property, plant and equipment, net $ 1,511,618 $ 1,511,708 During the year ended December 31, 2023 and 2022, the Company recorded depreciation of $83,253 and $91,427, respectively.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) Year Ended December 31, 2022 2021 Cash flows from operating activities: Net (loss)/profit $ (355,966 ) $ 751,571 Adjustments to reconcile net profit to net cash (used in)/generated from operating activities: Amortization of right of use asset 13,992 16,933 Bad debts 4,165 3,809 Depreciation of property, plant and equipment 91,427 91,282 Dividend income (115,379 ) (22,036 ) Fair value gain on other investments 70,628 29,850 Loss on written off of other investments 1,776 - Operating (loss)/profit before working capital changes (289,357 ) 871,409 Changes in operating assets and liabilities: Inventories 544,108 (345,745 ) Trade and other receivables 538,646 579,217 Deferred cost of revenue 67,606 (67,606 ) Trade and other payables (119,695 ) (1,180,535 ) Advance payment from customer (7,184 ) 30,307 Deferred revenue (77,276 ) 77,276 Operating lease liabilities (126,686 ) (20,169 ) Tax recoverable 13,866 65,007 Cash generated from operating activities 544,028 9,161 Cash flows from investing activities: Acquisition of other investment (511,706 ) (515,840 ) Dividend income 115,379 22,036 Purchase of plant and equipment (54,171 ) (3,162 ) Proceeds from disposal of other investments - 6,392 Net cash used in investing activities (450,498 ) (490,574 ) Cash flows from financing activities: Repayment of finance lease (34,038 ) (26,302 ) Repayments to directors - (1,920 ) Shares subscriptions 150,000 - Net cash generated from /(used in) financing activities 115,962 (28,222 ) Foreign currency translation adjustment (214,547 ) (154,138 ) NET CHANGE IN CASH AND CASH EQUIVALENTS (5,055 ) (663,773 ) CASH AND CASH EQUIVALENTS, BEGINNING OF FINANCIAL YEAR 2,123,919 2,787,692 CASH AND CASH EQUIVALENTS, END OF FINANCIAL YEAR $ 2,118,864 $ 2,123,919 F-7 Table of Contents BIONEXUS GENE LAB CORP.
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) Year Ended December 31, 2023 2022 Cash flows from operating activities: Net loss $ (2,629,043 ) $ (355,966 ) Adjustments to reconcile net profit to net cash (used in)/generated from operating activities: Amortization of right of use asset 25,170 13,992 Allowances for expected credit losses 942,800 - Bad debts 6,261 4,165 Depreciation of property, plant and equipment 83,253 91,427 Dividend income (61,409 ) (115,379 ) Fair value gain on other investments (313,859 ) 70,628 Loss on written off of other investments - 1,776 Impairment on other investment 6,194 - Interest 8,877 7,794 Property, plant and equipment written off 18 - Share-base compensation 511,740 - Stock written off 424 - Operating loss before working capital changes (1,419,574 ) (281,563 ) Changes in operating assets and liabilities: Inventories (160,387 ) 544,108 Trade and other receivables 650,810 538,646 Deferred cost of revenue - 67,606 Trade and other payables (381,293 ) (119,695 ) Advance payment from customer (23,123 ) (7,184 ) Deferred revenue - (77,276 ) Operating lease liabilities 76,620 (126,686 ) Tax recoverable (44,648 ) 13,866 Cash (used in)/generated from operating activities (1,301,595 ) 551,822 Cash flows from investing activities: Acquisition of other investment (320,733 ) (511,706 ) Dividend income 61,409 115,379 Purchase of plant and equipment (149,398 ) (54,171 ) Proceeds from disposal of other investments 26,146 - Net cash used in investing activities (382,576 ) (450,498 ) Cash flows from financing activities: Interest (8,877 ) (7,794 ) Repayment of finance lease - (34,038 ) Repayments to directors 13,199 - Shares subscriptions 5,750,000 150,000 Net cash generated from financing activities 5,754,322 108,168 Foreign currency translation adjustment (259,679 ) (214,547 ) NET CHANGE IN CASH AND CASH EQUIVALENTS 3,810,472 (5,055 ) CASH AND CASH EQUIVALENTS, BEGINNING OF FINANCIAL YEAR 2,118,864 2,123,919 CASH AND CASH EQUIVALENTS, END OF FINANCIAL YEAR $ 5,929,336 $ 2,118,864 F-8 BIONEXUS GENE LAB CORP.
As of December 31, December 31, 2022 2021 Tax Recoverable Local $ - $ - Foreign, representing Malaysia (31,551 ) - Tax Recoverable (31,551 ) - Income tax liabilities: Local - - Foreign, representing Malaysia - 97,585 Income tax liabilities - 97,585 Deferred tax liabilities: Local - - Foreign, representing Malaysia 30,866 28,416 Deferred tax liabilities 30,866 28,416 Total $ (685 ) $ 126,001 F-15 Table of Contents BIONEXUS GENE LAB CORP.
As of December 31, December 31, 2023 2022 Tax Recoverable Local $ - $ - Foreign, representing Malaysia (57,588 ) (31,551 ) Tax Recoverable (57,588 ) (31,551 ) Income tax liabilities: Local - - Foreign, representing Malaysia - - Income tax liabilities - - Deferred tax liabilities: Local - - Foreign, representing Malaysia 12,255 30,866 Deferred tax liabilities 12,255 30,866 Total $ (45,333 ) $ (685 ) F-17 BIONEXUS GENE LAB CORP.
All amounts have short-term repayment terms and vary by supplier. F-18 Table of Contents BIONEXUS GENE LAB CORP.
All amounts have short-term repayment terms and vary by supplier.
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) Year ended December 31, 2022 2021 REVENUE $ 10,928,707 $ 13,362,567 COST OF REVENUE (9,669,678 ) (11,095,626 ) GROSS PROFIT 1,259,029 2,266,941 OTHER INCOME 179,283 66,491 OPERATING EXPENSES General and administrative (1,729,489 ) (1,277,605 ) (LOSS)/PROFIT FROM OPERATIONS (291,177 ) 1,055,827 FINANCE COSTS (12,479 ) (12,973 ) (LOSS)/PROFIT BEFORE TAX (303,656 ) 1,042,854 Tax expense: Deferred tax (3,898 ) (26,736 ) Income tax (48,412 ) (264,547 ) Total tax expense (52,310 ) (291,283 ) NET (LOSS)/PROFIT $ (355,966 ) $ 751,571 Other comprehensive income: Foreign currency translation loss (308,800 ) (233,946 ) COMPREHENSIVE (LOSS)/INCOME $ (664,766 ) $ 517,625 Earnings per share - Basic and diluted (0.002 ) 0.004 Weighted average number of common shares outstanding – Basic and diluted 172,916,782 171,218,152 See accompanying notes to the consolidated financial statements.
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) Year ended December 31, 2023 2022 REVENUE $ 9,770,806 $ 10,928,707 COST OF REVENUE (8,441,308 ) (9,669,678 ) GROSS PROFIT 1,329,498 1,259,029 OTHER INCOME 486,036 179,283 OPERATING EXPENSES General and administrative (4,409,122 ) (1,729,489 ) LOSS FROM OPERATIONS (2,593,588 ) (291,177 ) FINANCE COSTS (13,929 ) (12,479 ) LOSS BEFORE TAX (2,607,517 ) (303,656 ) Tax expense: Deferred tax 17,359 (3,898 ) Income tax (38,885 ) (48,412 ) Total tax expense (21,526 ) (52,310 ) NET LOSS $ (2,629,043 ) $ (355,966 ) Other comprehensive income: Foreign currency translation loss (268,232 ) (308,800 ) COMPREHENSIVE LOSS $ (2,897,275 ) $ (664,766 ) Earnings per share - Basic and diluted (0.183 ) (0.046 ) Weighted average shares outstanding and per share amount have been adjusted for the periods shown to reflect the 12-for-1 reverse stock split effected on July 20, 2023, on a retroactive basis as described in Note 10. 15,875,455 14,409,733 See accompanying notes to the consolidated financial statements.
The corporate structure as at December 31, 2022 is depicted below: BioNexus Gene Lab Corp. a Wyoming company 100% owned 100% owned Bionexus Gene Lab Sdn. Bhd., a Malaysian company Chemrex Corporation Sdn. Bhd., a Malaysian Company F-9 Table of Contents BIONEXUS GENE LAB CORP.
The comparative financial statements were not adjusted retrospectively as Chemrex was not under common control during the comparative period. The corporate structure as at December 31, 2023 is depicted below: BioNexus Gene Lab Corp. a Wyoming company 100% owned 100% owned MRNA Scientific Sdn. Bhd. (formerly “Bionexus Gene Lab Sdn. Bhd.”), a Malaysian company Chemrex Corporation Sdn.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) As of December 31, 2022 and 2021 Total Assets Total Liabilities 2022 2021 2022 2021 BGLC & Bionexus $ 677,477 $ 1,167,214 $ 108,390 $ 121,586 Chemrex 8,062,685 8,407,176 1,966,759 2,273,025 TOTAL 8,740,162 9,574,390 2,075,149 2,394,611 NOTE 12 – SUBSEQUENT EVENTS In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2022 up through March 30, 2023 of these consolidated financial statements.
NOTE 14 – SUBSEQUENT EVENTS In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2023 up through April 15, 2024 of these consolidated financial statements.
As at December 31, 2021, common stock, no par value; 300,000,000 shares authorized and 171,218,152 shares outstanding, and preferred stock, no par value; 30,000,000 shares authorized and no shares outstanding. 10 $ 10,929,574 $ 10,779,574 Additional paid in capital (5,011,891 ) (5,011,891 ) Accumulated surplus 1,156,392 1,512,358 Accumulated other comprehensive losses (409,062 ) (100,262 ) TOTAL STOCKHOLDERS’ EQUITY 6,665,013 7,179,779 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 8,740,162 $ 9,574,390 See accompanying notes to the consolidated financial statements.
As at December 31, 2022, common stock, no par value; 300,000,000 shares authorized and 14,476,513 shares outstanding, and preferred stock, no par value 30,000,000 shares authorized and no shares outstanding (on a post-reverse stock split basis)*. 10 $ 17,191,315 $ 10,929,574 Additional paid in capital (5,011,891 ) (5,011,891 ) Accumulated surplus (1,844,278 ) 1,156,392 Accumulated other comprehensive losses (677,294 ) (409,062 ) TOTAL STOCKHOLDERS’ EQUITY 9,657,852 6,665,013 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 11,399,793 $ 8,740,162 * Issued and outstanding shares of common stock have been adjusted for the periods prior to July 20, 2023, to reflect the 12-for-1 reverse stock split effected on that date on a retroactive basis as described in Note 10.
During the period, the Company did not have any material recognizable subsequent events.
During the period, the Company did not have any material recognizable subsequent events. During the year, there was no subsequent event that required recognition or disclosure, except for those previously disclosed. F-23
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 9 – CONCENTRATION OF RISKS a) Major customers There are no major customers who accounted for 10% or more of the Company’s revenue for the financial year ended December 31, 2022 and 2021. b) Major suppliers For year ended December 31, 2022, the suppliers who accounted for 10% or more of the Company’s cost of sales and their balances at year ended are presented as follows: 2022 2021 2022 2021 2022 2021 Purchase Percentage of purchases Accounts payable trade Vendor A $ 1,497,142 $ 1,815,817 15.48 % 16.37 % $ 147,376 $ 397,636 Vendor B $ 1,425,867 $ 1,404,442 14.74 % 12.66 % $ 389,697 $ 405,999 Vendor C $ 1,424,476 $ 2,026,842 14.73 % 18.27 % $ 509,031 $ 640,827 Vendor D $ 1,171,511 $ 1,191,344 12.11 % 10.74 % $ 366,764 $ 269,966 $ 5,518,996 $ 6,438,445 57.06 % 58.03 % $ 1,412,868 $ 1,714,428 NOTE 10– STOCKHOLDERS’ EQUITY As at December 31, 2022 and 2021, the Company issued and outstanding, common stock is 173,718,152 and 171,218,152 shares respectively.
NOTE 9 – CONCENTRATION OF RISKS a) Major customers There are no major customers who accounted for 10% or more of the Company’s revenue for the financial year ended December 31, 2023 and December 2022. b) Major suppliers For year ended December 31, 2023 and 2022, the suppliers who accounted for 10% or more of the Company’s cost of sales and their balances at year ended are presented as follows: 2023 2022 2023 2022 2023 2022 Purchase Percentage of purchases Accounts payable trade Vendor A $ 1,467,381 $ 1,425,867 17.38 % 14.75 % $ 252,435 $ 389,697 Vendor B $ 1,439,569 $ 1,424,476 17.05 % 14.73 % $ 354,170 $ 509,031 Vendor C $ 1,224,113 $ 1,171,511 14.50 % 12.12 % $ 208,186 $ 366,764 $ 4,131,063 $ 4,021,854 48.93 % 41.60 % $ 814,791 $ 1,265,492 F-20 BIONEXUS GENE LAB CORP.
In November 2019, the FASB issued ASU No. 2019-10, which to update the effective date of ASU No. 2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit losses, leases, and hedging standard. The new effective date for these preparers is for fiscal years beginning after December 15, 2022.
In November 2019, the FASB issued ASU 2019-10 highlighted the adoption timeline. For smaller reporting entities, Topic 326 is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years, of which is effective for the Company on January 1, 2023.
Removed
F-4 Table of Contents BIONEXUS GENE LAB CORP.
Added
See accompanying notes to the consolidated financial statements. F-5 BIONEXUS GENE LAB CORP.
Removed
F-6 Table of Contents BIONEXUS GENE LAB CORP.
Added
See accompanying notes to the consolidated financial statements. F-7 BIONEXUS GENE LAB CORP.
Removed
The comparative financial statements were not adjusted retrospectively as Chemrex was not under common control during the comparative period. On April 12, 2022, the Company entered into Sales & Purchase Agreement with Keith Wong pursuant to which the Company agreed to the sales of 2,500,000 shares of its common stock at $0.06/share.
Added
Credit loss rate is determined by historical collection based on aging schedule, adjusted for current conditions using reasonable and supportable forecasts. Based on the aging categorization and the adjusted loss rate per category, an allowance for credit losses is calculated by multiplying the adjusted loss rate with the amortized cost in the respective age category.
Removed
The issuance was exempt under Section 4(a)(2) of the Securities Act as the recipient was a sophisticated investor, the shares were restricted securities and he represented that he is acquiring the shares for investment purposes.
Added
From January 1, 2023, the Company apply expected credit losses (“ECL”) model to determine impairment on trade receivables that are measured at amortized cost. This resulted a modified-retrospective transition approach that would require a cumulative-effect adjustment to the opening retained earnings in the consolidated statement of financial position as of January 1, 2023.
Removed
The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements: Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.
Added
The following table reconciles the closing loss allowance measured incurred loss model as at December 31, 2022 to the opening loss allowance measured in accordance with the Topic 326 ECL model at January 1, 2023.
Removed
F-12 Table of Contents BIONEXUS GENE LAB CORP.
Added
Consolidated Statement of Financial Position Reported as at December 31, 2022 Effect of adoption on ECL Restated as at January 1, 2023 Trade receivables $ 2,868,364 $ (371,627 ) $ 2,496,737 Retained earnings brought forward 1,156,392 (371,627 ) 784,765 F-15 BIONEXUS GENE LAB CORP.
Removed
In May 2019, the FASB issued ASU 2019-05, which is an update to ASU Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology.
Added
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 3 – TRADE RECEIVABLES The Company has performed an analysis on all its trade receivables. As such, trade receivables are recognized and carried at the original invoice amount less an allowance for any uncollectible amounts.
Removed
The amendments in Update 2016-13 added Topic 326, Financial Instruments—Credit Losses, and made several consequential amendments to the Codification. The amendments in this Update address those stakeholders’ concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis.
Added
An estimate for doubtful debts and expected credit losses is made when collection of the full amount is no longer probable. Bad debts are written off as identified for the quarter ended December 31, 2023. The Company’s trade receivables consist of receivable from customers which are unrelated to the Company.
Removed
For those entities, the targeted transition relief will increase comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets. Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement users with decision-useful information.
Added
The account receivables are interest bearing at a rate of 6% per annum on Interlink Techno started in May 2021 till June 2023. From July 2023 onwards, Chemrex had increased the interest to 8.4%. Chemrex imposed 6% per annum interest on Mawintech Sdn Bhd since May 2021 till to date.
Removed
ASU 2019-05 is effective for the Company for annual and interim reporting periods beginning January 1, 2023 as the Company is qualified as a smaller reporting company. The Company is currently evaluating the impact ASU 2019-05 may have on its consolidated financial statements. FASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions.
Added
The normal trade credit term is generally on 30 days to 90 days term.
Removed
On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance.
Added
As of December 31, December 31, 2023 2022 Trade receivables 2,107,182 2,868,364 Allowances for expected credit losses (1,314,427 ) - Foreign translation differences (6,919 ) $ 799,674 $ 2,868,364 Movement for trade receivables allowance for impairment accounts: 2023 2022 At January 1 - - Impacts arising from application of Topic 326 371,627 - At January 1, (restated) 371,627 - Charge for the year 942,800 - Foreign translation differences (6,919 ) - At December 31 $ 1,307,508 $ - F-16 BIONEXUS GENE LAB CORP.
Removed
The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception. NOTE 3 – TRADE RECEIVABLES The Company has performed an analysis on all its trade receivables and determined that all amounts are collectible by the Company.
Added
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2023 AND 2022 (Currency expressed in United States Dollars (“US$”)) (Audited) NOTE 10– STOCKHOLDERS’ EQUITY As at December 31, 2023 and 2022, the Company issued and outstanding, common stock is 17,667,663 and 14,476,513 shares respectively.
Removed
As such, trade receivables are reflected as a current asset and no allowance for impairment has been recorded as of December 31, 2022 and December 31, 2021. Total of $12,600 and $3,809 of bad debts were written off for the year ended December 31, 2022 and December 31, 2021, respectively.
Added
Reverse Stock Split On June 5, 2023, the Company filed an Article of Amendment to the Articles of Incorporation with the Wyoming Secretary of State to modify the ratio of the Reverse Stock Split from one-for-ten (10) to one-for-twelve (12) (the “Revised Reverse Stock Split”).
Removed
The Company’s trade receivables consist of receivable from customers which are unrelated to the Company. The account receivables are non-interest bearing and is generally on 30 days to 90 days term. F-14 Table of Contents BIONEXUS GENE LAB CORP.
Added
Upon effectiveness of the Revised Reverse Stock Split, every twelve (12) outstanding shares of common stock were combined into and automatically became one share of common stock.
Removed
Under the amendment of Income Tax Act 1967 by the Finance Act 2020 and with effect from year of assessment 2020, companies with paid-up capital of RM2.5 million or less, and with annual business income of not more than RM50 million are subject to Small and Medium Enterprise Corporate Tax at 17% on chargeable income up to RM600,000 (2021: RM600,000) except for companies with investment holding nature or companies does not have gross income from business sources are subject to corporate tax at 24% on chargeable income.
Added
No fractional shares was issued in connection with the Revised Reverse Stock Split and all such fractional shares or odd lots (less than 100 shares to any record or beneficial holder) issuable in the Revised Reverse Stock Split were rounded up to 100 shares. An aggregate of 1,044,351 shares were issued to applicable shareholders as a result of the round-up.
Removed
F-16 Table of Contents BIONEXUS GENE LAB CORP.
Added
The Revised Reverse Stock Split was approved and authorized by a majority of the Company’s stockholder on May 8, 2023 and by the Board of Directors of the Company on May 8, 2023.
Removed
F-17 Table of Contents BIONEXUS GENE LAB CORP.
Added
Public Offering & Nasdaq Listing On July 20, 2023, the Company entered into an underwriting agreement (the "Underwriting Agreement") with Network 1 Financial Securities, Inc., as underwriter (the "Underwriter") pursuant to which the Company agreed to issue and sell, in a firm commitment underwritten public offering by the Company (the "Offering") of 1,250,000 shares of common stock, no par value, priced at a public offering price of $4.00 per share.
Removed
On April 12, 2022, the Company entered into Sales & Purchase Agreement with Keith Wong pursuant to which the Company agreed to the sales of 2,500,000 shares of its common stock at $0.06/share.
Added
In addition, pursuant to the Underwriting Agreement, the Underwriter was granted a 45-day option (the "Over-Allotment Option") to purchase up to an additional 187,500 shares of common stock at the public offering price of $4.00 per share. The Underwriter fully exercised the Over-Allotment Option on July 24, 2023.
Removed
The issuance was exempt under Section 4(a)(2) of the Securities Act as the recipient was a sophisticated investor, the shares were restricted securities and he represented that he is acquiring the shares for investment purposes.
Added
The securities were offered by the Company pursuant to the registration statement on Form S-1 (File No. 333-269753), which was originally filed with the U.S. Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended, on February 14, 2023, and declared effective by the Commission on July 19, 2023.
Removed
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021 (Currency expressed in United States Dollars (“US$”)) (Audited) For year ended December 31, 2022, segmented revenue and net profit/(loss) (Currency expressed in United States Dollars (“US$”) are as follows: BioNexus Malaysia Chemrex BGLC Total Year ended December 31, 2022 REVENUE $ 95,816 $ 10,832,891 $ - $ 10,928,707 COST OF REVENUE (51,465 ) (9,618,213 ) - (9,669,678 ) GROSS PROFIT 44,351 1,214,678 - 1,259,029 OTHER INCOME 8,830 170,453 - 179,283 OPERATING EXPENSES General and administrative (286,753 ) (1,051,855 ) (390,881 ) (1,729,489 ) FINANCE COSTS (5,657 ) (6,822 ) - (12,479 ) (LOSS)/PROFIT BEFORE TAX (239,229 ) 326,454 (390,881 ) (303,656 ) Tax expense: Deferred tax (1,428 ) (2,470 ) - (3,898 ) Income tax - (48,412 ) - (48,412 ) Total tax expense (1,428 ) (50,882 ) - (52,310 ) NET (LOSS)/PROFIT $ (240,657 ) $ 275,572 $ (390,881 ) $ (355,966 ) BioNexus Malaysia Chemrex BGLC Total Year ended December 31, 2021 REVENUE $ 1,515,673 $ 11,846,894 $ - $ 13,362,567 COST OF REVENUE (1,052,938 ) (10,042,688 ) - (11,095,626 ) GROSS PROFIT 462,735 1,804,206 - 2,266,941 OTHER INCOME 7,467 59,024 - 66,491 OPERATING EXPENSES General and administrative (160,094 ) (989,617 ) (127,894 ) (1,277,605 ) FINANCE COSTS (4,158 ) (8,815 ) - (12,973 ) PROFIT/(LOSS) BEFORE TAX 305,950 864,798 (127,894 ) 1,042,854 Tax expense: Deferred tax (11,997 ) (14,739 ) - (26,736 ) Income tax (30,482 ) (234,065 ) - (264,547 ) Total tax expense (42,479 ) (248,804 ) - (291,283 ) NET PROFIT/(LOSS) $ 263,471 $ 615,994 $ (127,894 ) $ 751,571 F-20 Table of Contents BIONEXUS GENE LAB CORP.
Added
On July 24, 2023, the Offering closed, and the Company issued and sold 1,437,500 shares of common stock, including 187,500 shares sold pursuant to the full exercise of the Over-Allotment Option. The Offering was priced at $4.00 per share for total gross proceeds of $5.75 million before deducting underwriting discounts, commissions, and offering expenses.
Added
Pursuant to the Underwriting Agreement, the Underwriter received an 8% underwriting discount on the public offering price for the shares common stock. The Company will therefore receive net proceeds, before expenses, of $5,290,000 from the sale of the common stocks.
Added
In addition, the Company issued to the Underwriter warrants to purchase up to an aggregate of 115,000 shares of the Company's common stock (the "Underwriter's Warrants") at an exercise price of $4.40 per share. The Underwriter's Warrants are exercisable from July 24, 2023 until July 24, 2028.
Added
In August, 2023, an aggregate of 759,299 shares of common stock were issued to professional parties or service providers in lieu of cash for services rendered, 125,000 were subsequently cancelled in November, 2023.

… 12 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

150 edited+27 added−13 removed55 unchanged
Biggest changeAs a public company, we may become subject to the Section 404 of the Sarbanes-Oxley Act, or SOX 404, which requires that we include a report from management on the effectiveness of our internal control over financial reporting in our annual report on Form 10-K and in our quarterly report on Form 10-Q if we are qualified as an accelerated filer.
Biggest changeAs a public company, we may become subject to the Section 404 of the Sarbanes-Oxley Act, or SOX 404, which requires that we include a report from management on the effectiveness of our internal control over financial reporting in our annual report on Form 10-K and in our quarterly report on Form 10-Q if we are qualified as an accelerated filer. 19 Table of Contents We are currently a “smaller reporting company”, meaning that we are not an investment company, an asset- backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and annual revenues of less than $50.0 million during the most recently completed fiscal year.
Any significant uninsured liability may require us to pay substantial amounts, which would adversely affect BioNexus’ financial position and results of operations. Our lack of insurance could expose us to significant costs and business disruption. We currently do not have any product liability or disruption insurance to cover our operations in Malaysia or overseas.
Any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our financial position and results of operations. Our lack of insurance could expose us to significant costs and business disruption. We currently do not have any product liability or disruption insurance to cover our operations in Malaysia or overseas.
In combination with other anticipated increased operating expenses in connection with becoming a public company, these anticipated changes in our operating expenses may make it difficult to evaluate our current business, assess our future performance relative to prior performance and accurately predict BioNexus’ future performance.
In combination with other anticipated increased operating expenses in connection with becoming a public company, these anticipated changes in our operating expenses may make it difficult to evaluate our current business, assess our future performance relative to prior performance and accurately predict our future performance.
Furthermore, partners, collaborators, or other parties to such transactions or arrangements may fail to fully perform their obligations or meet its expectations or cooperate with us satisfactorily for various reasons and subject us to potential risks, including the followings: · partners, collaborators, or other parties have significant discretion in determining the efforts and resources that they will apply to a transaction or arrangement; · partners, collaborators, or other parties could independently develop, or develop with third parties, services and products that compete directly or indirectly with its services and products; · partners, collaborators, or other parties may stop, delay or discontinue research and development, and commercialization efforts; · partners, collaborators, or other parties may not properly maintain or defend BioNexus’ intellectual property rights or may use its intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate its intellectual property or proprietary information or expose us to potential liability; · disputes may arise between us and partners, collaborators, or other parties that cause the delay or termination of the research, development or commercialization of BioNexus’ services and products, or that result in costly litigation or arbitration that diverts management attention and resources; · partners, collaborators, or other parties may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable services and products; and · partners, collaborators, or other parties may own or co-own intellectual property covering BioNexus’ services and products that results from BioNexus’ collaborations with them, and in such cases, BioNexus would not have the exclusive right to commercialize such intellectual property.
Furthermore, partners, collaborators, or other parties to such transactions or arrangements may fail to fully perform their obligations or meet its expectations or cooperate with us satisfactorily for various reasons and subject us to potential risks, including the followings: · partners, collaborators, or other parties have significant discretion in determining the efforts and resources that they will apply to a transaction or arrangement; · partners, collaborators, or other parties could independently develop, or develop with third parties, services and products that compete directly or indirectly with its services and products; · partners, collaborators, or other parties may stop, delay or discontinue research and development, and commercialization efforts; · partners, collaborators, or other parties may not properly maintain or defend our intellectual property rights or may use its intellectual property or proprietary information in a way that gives rise to actual or threatened litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential liability; · disputes may arise between us and partners, collaborators, or other parties that cause the delay or termination of the research, development or commercialization of our services and products, or that result in costly litigation or arbitration that diverts management attention and resources; · partners, collaborators, or other parties may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable services and products; and · partners, collaborators, or other parties may own or co-own intellectual property covering our services and products that results from our collaborations with them, and in such cases, we would not have the exclusive right to commercialize such intellectual property.
If one or more of BioNexus’ senior management or key clinical and scientific personnel are unable or unwilling to continue in their present positions or joins a competitor or forms a competing company, the company may not be able to replace them in a timely manner or at all, which will have a material and adverse effect on its business, financial condition and results of operations.
If one or more of our senior management or key clinical and scientific personnel are unable or unwilling to continue in their present positions or joins a competitor or forms a competing company, the company may not be able to replace them in a timely manner or at all, which will have a material and adverse effect on its business, financial condition, and results of operations.
BioNexus may be subject to intellectual property claims, which are extremely costly to defend, could require us to pay significant damages and could limit the company’s ability to use certain technologies in the future. Companies in bio-medical or bio-technology industries are frequently subject to litigation based on allegations of infringement or other violations of intellectual property rights.
We may be subject to intellectual property claims, which are extremely costly to defend, could require us to pay significant damages and could limit the company’s ability to use certain technologies in the future. Companies in bio-medical or bio-technology industries are frequently subject to litigation based on allegations of infringement or other violations of intellectual property rights.
Accordingly, BioNexus’ financial condition and results of operations are affected to a significant extent by economic, political and legal developments in Southeast Asia region. The Southeast Asia economy differs from the economies of most developed countries in many respects, including the extent of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.
Accordingly, our financial condition and results of operations are affected to a significant extent by economic, political and legal developments in Southeast Asia region. The Southeast Asia economy differs from the economies of most developed countries in many respects, including the extent of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.
The ability of BioNexus’ subsidiaries to pay dividends or make other payments may be restricted by the foreign exchange control policies in the countries where they operate. For example, there are foreign exchange policies in Malaysia which support the monitoring of capital flows into and out of the country in order to preserve its financial and economic stability.
The ability of our subsidiaries to pay dividends or make other payments may be restricted by the foreign exchange control policies in the countries where they operate. For example, there are foreign exchange policies in Malaysia which support the monitoring of capital flows into and out of the country in order to preserve its financial and economic stability.
In addition, it may be necessary to work with a partner on one or more of BioNexus’ tests or products under development, which could lower the economic value of those products to us. Each of the foregoing may harm BioNexus’ business, operating results, and financial condition and may impact BioNexus’ ability to continue as a going concern.
In addition, it may be necessary to work with a partner on one or more of our tests or products under development, which could lower the economic value of those products to us. Each of the foregoing may harm our business, operating results, and financial condition and may impact our ability to continue as a going concern.
The incurrence of additional indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in certain additional restrictive covenants, such as limitations on BioNexus’ ability to incur additional debt or issue additional equity, limitations on BioNexus’ ability to acquire or license IP rights and other operating restrictions that could adversely impact BioNexus’ ability to conduct its business.
The incurrence of additional indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in certain additional restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license IP rights and other operating restrictions that could adversely impact our ability to conduct its business.
Any intellectual property claims against us, with or without merit, could be time consuming and expensive to settle or litigate and could divert the attention of its management. Litigation regarding intellectual property rights is inherently uncertain due to the complex issues involved, and the company may not be successful in defending itself in such matters.
Any intellectual property claims against us, with or without merit, could be time consuming and expensive to settle or litigate and could divert the attention of our management. Litigation regarding intellectual property rights is inherently uncertain due to the complex issues involved, and the company may not be successful in defending itself in such matters.
BioNexus’ business, prospects, financial condition and results of operations may be adversely affected by social, political, regulatory and economic developments in Malaysia. Such political and economic uncertainties include, but are not limited to, the risks of war, terrorism, nationalism, nullification of contract, changes in interest rates, imposition of capital controls and methods of taxation.
Our business, prospects, financial condition and results of operations may be adversely affected by social, political, regulatory and economic developments in Malaysia. Such political and economic uncertainties include, but are not limited to, the risks of war, terrorism, nationalism, nullification of contract, changes in interest rates, imposition of capital controls and methods of taxation.
As the company’s operations expand, it may be subject to these laws in other jurisdictions where its customers and other participants are located. The laws, rules and regulations of other jurisdictions may impose more stringent or conflicting requirements and penalties than those in Malaysia, compliance with which could require significant resources and costs.
As our operations expand, it may be subject to these laws in other jurisdictions where its customers and other participants are located. The laws, rules and regulations of other jurisdictions may impose more stringent or conflicting requirements and penalties than those in Malaysia, compliance with which could require significant resources and costs.
Returning to the pre-pandemic business pattern will take time and depends on the government’s response to the population health and socioeconomic demands arising due to the pandemic. Although the overall Malaysian economic environment (in which BioNexus predominantly operate) appears to be positive, there can be no assurance that this will continue to prevail in the future.
Returning to the pre-pandemic business pattern will take time and depends on the government’s response to the population health and socioeconomic demands arising due to the pandemic. Although the overall Malaysian economic environment (in which we predominantly operate) appears to be positive, there can be no assurance that this will continue to prevail in the future.
Global economic conditions could materially adversely impact demand for BioNexus’ products and services. BioNexus’ operations and performance depend significantly on economic conditions. Global financial conditions continue to be subject to volatility arising from international geopolitical developments and global economic phenomenon, as well as general financial market turbulence and natural phenomena such as the COVID-19 pandemic.
Global economic conditions could materially adversely impact demand for our products and services. Our operations and performance depend significantly on economic conditions. Global financial conditions continue to be subject to volatility arising from international geopolitical developments and global economic phenomenon, as well as general financial market turbulence and natural phenomena such as the COVID-19 pandemic.
BioNexus’ financial condition and results of operation could be materially and adversely affected by government control over capital investments or changes in tax regulations that are applicable to us. In addition, the government has implemented in the past certain measures, including interest rate increases, to control the pace of economic growth.
Our financial condition and results of operation could be materially and adversely affected by government control over capital investments or changes in tax regulations that are applicable to us. In addition, the government has implemented in the past certain measures, including interest rate increases, to control the pace of economic growth.
The rights of BioNexus’ shareholders and the fiduciary responsibilities of its directors under Malaysian law are not as clearly established as they would be under statutes or judicial precedents in the United States. Malaysia has a less developed body of securities laws than the United States and provides significantly less protection to investors.
The rights of our shareholders and the fiduciary responsibilities of its directors under Malaysian law are not as clearly established as they would be under statutes or judicial precedents in the United States. Malaysia has a less developed body of securities laws than the United States and provides significantly less protection to investors.
BGL’s ability to generate sales revenue from its products and services and its future profitability depends on several factors, including its ability to: · obtain regulatory approvals and marketing authorizations for BGL’s services and products; · obtain market acceptance by patients, hospitals, clinicians, biopharmaceutical companies and others in the medical community; · establish sufficient testing capacity and commercial capabilities, either by expanding BGL’s current facility or making arrangements with third parties; · develop and maintain BGL’s sales network to launch and commercialize its new cancer genomic testing services and products; · set appropriate and favorable prices for BGL’s genomic testing services and products and obtaining adequate reimbursement from third-party payers; 27 Table of Contents · maintain commercially viable supply relationships with third parties and maintaining sufficient research and development capabilities and infrastructure; · address any competing technological and market developments; and · maintain, protect, and expand BGL’s portfolio of intellectual property rights including trade secrets and know-how.
MRNA Scientific’s ability to generate sales revenue from its products and services and its future profitability depends on several factors, including its ability to: 20 Table of Contents · obtain regulatory approvals and marketing authorizations for MRNA Scientific’s services and products; · obtain market acceptance by patients, hospitals, clinicians, biopharmaceutical companies and others in the medical community; · establish sufficient testing capacity and commercial capabilities, either by expanding MRNA Scientific’s current facility or making arrangements with third parties; · develop and maintain MRNA Scientific’s sales network to launch and commercialize its new cancer genomic testing services and products; · set appropriate and favorable prices for MRNA Scientific’s genomic testing services and products and obtaining adequate reimbursement from third-party payers; · maintain commercially viable supply relationships with third parties and maintaining sufficient research and development capabilities and infrastructure; · address any competing technological and market developments; and · maintain, protect, and expand MRNA Scientific’s portfolio of intellectual property rights including trade secrets and know-how.
Unauthorized access, loss, or dissemination could also result in delays of BGL’s services and tests development and commercialization as well as damage BGL’s reputation, including BGL’s ability to conduct its analysis, deliver test results, process claims and appeals, provide customer assistance, conduct research and development activities, collect, process, and prepare company financial information, provide information about BGL’s tests and other patient and physician education and outreach efforts through its website, and manage the administrative aspects of its business.
Unauthorized access, loss, or dissemination could also result in delays of MRNA Scientific’s services and tests development and commercialization as well as damage MRNA Scientific’s reputation, including MRNA Scientific’s ability to conduct its analysis, deliver test results, process claims and appeals, provide customer assistance, conduct research and development activities, collect, process, and prepare company financial information, provide information about MRNA Scientific’s tests and other patient and physician education and outreach efforts through its website, and manage the administrative aspects of its business.
Continued and additional market acceptance and its ability to attract new customers are key elements to its future success. 28 Table of Contents BGL’s ability to increase sales of its services and establish greater levels of adoption and reimbursement for its tests is uncertain for many reasons, including, among others: · BGL may be unable to demonstrate to laboratories, clinics, clinicians, physicians, payors, and patients that its services are superior to alternatives with respect to value, convenience, specificity, sensitivity, scope of coverage, and other factors; · third-party coverage and reimbursement are currently primarily limited to high-risk pregnancies and may not gain acceptance for use in the average-risk pregnancy population or for the screening of microdeletions, limiting the overall addressable market; · third-party payors may set the amounts of reimbursement at prices that reduce its profit margins or do not allow us to cover its expenses; · BGL may not be able to maintain and grow effective sales and marketing capabilities; · its sales and marketing efforts may fail to effectively reach customers or communicate the benefits of its services; · superior alternatives to its services may be developed and commercialized; · BGL may experience supply constraints, including due to the failure of its key suppliers to provide required sequencing instruments and reagents; · regulatory or legislative bodies may adopt new regulations or policies or take other actions that impose significant restrictions on its ability to market its services.
Continued and additional market acceptance and its ability to attract new customers are key elements to its future success. 21 Table of Contents MRNA Scientific’s ability to increase sales of its services and establish greater levels of adoption and reimbursement for its tests is uncertain for many reasons, including, among others: · MRNA Scientific may be unable to demonstrate to laboratories, clinics, clinicians, physicians, payors, and patients that its services are superior to alternatives with respect to value, convenience, specificity, sensitivity, scope of coverage, and other factors; · third-party coverage and reimbursement are currently primarily limited to high-risk pregnancies and may not gain acceptance for use in the average-risk pregnancy population or for the screening of microdeletions, limiting the overall addressable market; · third-party payors may set the amounts of reimbursement at prices that reduce its profit margins or do not allow us to cover its expenses; · MRNA Scientific may not be able to maintain and grow effective sales and marketing capabilities; · its sales and marketing efforts may fail to effectively reach customers or communicate the benefits of its services; · superior alternatives to its services may be developed and commercialized; · MRNA Scientific may experience supply constraints, including due to the failure of its key suppliers to provide required sequencing instruments and reagents; · regulatory or legislative bodies may adopt new regulations or policies or take other actions that impose significant restrictions on its ability to market its services.
Any claims successfully brought against us could subject us to significant liability for damages and BioNexus may be required to stop using technology or other intellectual property alleged to be in violation of a third party’s rights. BioNexus also might be required to seek a license for third-party intellectual property.
Any claims successfully brought against us could subject us to significant liability for damages and we may be required to stop using technology or other intellectual property alleged to be in violation of a third party’s rights. We also might be required to seek a license for third-party intellectual property.
We have non-written contracts with suppliers and customers, which are generally terminable upon notice, and the termination of our relationships with suppliers and customers contracts could negatively affect our business. Our purchases and sales of chemicals are typically made pursuant to verbal purchase orders rather than written contracts.
We have oral contracts with suppliers and customers, which are generally terminable upon notice, and the termination of our relationships with suppliers and customers contracts could negatively affect our business. Our purchases and sales of chemicals are typically made pursuant to verbal purchase orders rather than written contracts.
As a result, there may be potential conflicts of interest and negatively impact the amount of time they will be able to dedicate to the company. Currently BioNexus’ officers, who are also directors, have been working on promoting business for the Company.
As a result, there may be potential conflicts of interest and negatively impact the amount of time they will be able to dedicate to the company. Currently our officers, who are also directors, have been working on promoting business for the Company.
All sectors of the economy in 2022 across Malaysia saw their supply chains interrupted, demand for their products and services decline, shortages in supplies and inputs. We will emerge in a very different world compared to the one before the outbreak.
All sectors of the economy in 2023 across Malaysia saw their supply chains interrupted, demand for their products and services decline, shortages in supplies and inputs. We will emerge in a very different world compared to the one before the outbreak.
We may also face adverse publicity associated with such claims, which could have an adverse effect on our business, results of operations and financial condition. Risks Related to Its Operations BioNexus’ officers and directors may in future have outside business activities.
We may also face adverse publicity associated with such claims, which could have an adverse effect on our business, results of operations and financial condition. Risks Related to Our Operations Our officers and directors may in future have outside business activities.
As a result, BioNexus’ public shareholders may have more difficulty in protecting their interests through actions against us, its management, its directors or its major shareholders than would shareholders of a corporation incorporated in a jurisdiction in the United States.
As a result, our public shareholders may have more difficulty in protecting their interests through actions against us, its management, its directors or its major shareholders than would shareholders of a corporation incorporated in a jurisdiction in the United States.
Making any such adjustments could take a considerable amount of time and expense, and BGL’s might not will succeed in running its tests on the hardware and software that it may encounter in different laboratories. To manage this issue, BGL’s may license or acquire additional instruments and software from another company that will be compatible with its tests.
Making any such adjustments could take a considerable amount of time and expense, and MRNA Scientific’s might not will succeed in running its tests on the hardware and software that it may encounter in different laboratories. To manage this issue, MRNA Scientific’s may license or acquire additional instruments and software from another company that will be compatible with its tests.
BGL monitors its use of open-source software in an effort to avoid uses in a manner that would require it to disclose or grant licenses under its proprietary source code; however, there can be no assurance that such efforts will be successful. Open-source license terms are often ambiguous and such use could inadvertently occur.
MRNA Scientific monitors its use of open-source software in an effort to avoid uses in a manner that would require it to disclose or grant licenses under its proprietary source code; however, there can be no assurance that such efforts will be successful. Open-source license terms are often ambiguous and such use could inadvertently occur.
Changes in the political and economic policies of Malaysia and other governments in Southeast Asia may materially and adversely affect BioNexus’ business, financial condition and results of operations and may result in its inability to sustain its growth and expansion strategies.
Changes in the political and economic policies of Malaysia and other governments in Southeast Asia may materially and adversely affect our business, financial condition and results of operations and may result in its inability to sustain its growth and expansion strategies.
If the market and its market share for its genomic products fail to grow or grow more slowly than expected, its business, operating results, and financial condition would be adversely affected. BGL’s success depends on their ability to improve and enhance its current tests and new test candidates, which is complex and costly, and the results are uncertain.
If the market and its market share for its genomic products fail to grow or grow more slowly than expected, its business, operating results, and financial condition would be adversely affected. MRNA Scientific’s success depends on their ability to improve and enhance its current tests and new test candidates, which is complex and costly, and the results are uncertain.
The launch of such new test requires the completion of certain clinical development and/or assay validations in the commercial laboratory. This process is conducted in various stages, and each stage presents the risk that BGL will not achieve its goals and will not be able to complete clinical development for any planned test in a timely manner.
The launch of such new test requires the completion of certain clinical development and/or assay validations in the commercial laboratory. This process is conducted in various stages, and each stage presents the risk that MRNA Scientific will not achieve its goals and will not be able to complete clinical development for any planned test in a timely manner.
In addition, some of BioNexus’ competitors have extensive portfolios of issued patents. Many potential litigants, including some of BioNexus’ competitors and patent holding companies, have the ability to dedicate substantial resources to enforcing their intellectual property rights.
In addition, some of our competitors have extensive portfolios of issued patents. Many potential litigants, including some of our competitors and patent holding companies, have the ability to dedicate substantial resources to enforcing their intellectual property rights.
BGL’s screening tests have gone through preclinical and clinical trials involving private hospitals and government agencies including the Institute of Medical Research (IMR), Malaysian Biotechnology Corporation (BiotechCorp) and the Clinical Research Centre (CRC). The findings of the preclinical and clinical trials are published in peer reviewed journals such as the Journal of Molecular and Cellular Cardiology, and Physiological Genomics.
MRNA Scientific’s screening tests have gone through preclinical and clinical trials involving private hospitals and government agencies including the Institute of Medical Research (IMR), Malaysian Biotechnology Corporation (BiotechCorp) and the Clinical Research Centre (CRC). The findings of the preclinical and clinical trials are published in peer reviewed journals such as the Journal of Molecular and Cellular Cardiology, and Physiological Genomics.
Even if you are successful in bringing an action of this kind, the laws of Malaysia may render you unable to enforce a judgment against BioNexus’ assets or the assets of BioNexus’ directors and officers.
Even if you are successful in bringing an action of this kind, the laws of Malaysia may render you unable to enforce a judgment against our assets or the assets of our directors and officers.
BGL’s financial prospects depend substantially upon the successful commercialization of the Company’s services and products in the future, which may fail or experience significant delays. BGL’s future success depends upon BGL’s ability to continuously develop technologies and successfully market its existing cancer genetic offerings to customers within Malaysia and expand overseas.
MRNA Scientific’s financial prospects depend substantially upon the successful commercialization of the Company’s services and products in the future, which may fail or experience significant delays. MRNA Scientific’s future success depends upon MRNA Scientific’s ability to continuously develop technologies and successfully market its existing cancer genetic offerings to customers within Malaysia and expand overseas.
Such development and/or validation failures could prevent or significantly delay its ability to obtain FDA clearance or approval as may be necessary or desired, obtain approval by entities that provide oversight over laboratory diagnostic tests in the localities BGL operate in, or launch any of its planned tests and test candidates.
Such development and/or validation failures could prevent or significantly delay its ability to obtain FDA clearance or approval as may be necessary or desired, obtain approval by entities that provide oversight over laboratory diagnostic tests in the localities MRNA Scientific operate in, or launch any of its planned tests and test candidates.
BGL’s privacy policies and practices concerning the collection, use and disclosure of user data are posted on its websites. Any failure, or perceived failure, by us to comply with BGL’s posted privacy policies or with any regulatory requirements or privacy protection-related laws, rules and regulations could result in proceedings or actions against us by authorities or others.
MRNA Scientific’s privacy policies and practices concerning the collection, use and disclosure of user data are posted on its websites. Any failure, or perceived failure, by us to comply with MRNA Scientific’s posted privacy policies or with any regulatory requirements or privacy protection-related laws, rules and regulations could result in proceedings or actions against us by authorities or others.
These measures may cause decreased economic activity, which in turn could lead to a reduction in demand for its services and consequently have a material adverse effect on its businesses, financial condition and results of operations. Developments in the social, political, regulatory and economic environment in Malaysia may have a material adverse impact on us.
These measures may cause decreased economic activity, which in turn could lead to a reduction in demand for its services and consequently have a material adverse effect on its businesses, financial condition and results of operations. 27 Table of Contents Developments in the social, political, regulatory and economic environment in Malaysia may have a material adverse impact on us.
A substantial decrease has been observed in overall spending, which resulted in an array of estimated long-term uncertainty impacts. Consequently, many businesses and firms closed, and employees were dismissed.
A substantial decrease has been observed in overall spending, which resulted in an array of estimated long-term uncertainty impacts. Consequently, many businesses and firms closed, and employees were dismissed.
The company’s operating subsidiaries are incorporated in Malaysia and conduct substantially all of its operations in Southeast Asia. All of BioNexus’ executive officers and directors reside outside the United States, and all their assets are located outside of the United States.
The company’s operating subsidiaries are incorporated in Malaysia and conduct substantially all of its operations in Southeast Asia. All of our executive officers and directors reside outside the United States, and all their assets are located outside of the United States.
BGL’s ability to generate significant revenue in the next several years will depend primarily on the successes of each key stage of its business, including pre-clinical research and development, clinical trials, regulatory approval, manufacture, marketing and commercialization of its services and products, which is subject to significant uncertainty.
MRNA Scientific’s ability to generate significant revenue in the next several years will depend primarily on the successes of each key stage of its business, including pre-clinical research and development, clinical trials, regulatory approval, manufacture, marketing and commercialization of its services and products, which is subject to significant uncertainty.
In addition, many universities and private and public research institutes may become active in BGL’s target disease areas. If BGL’s competitors market products that are more effective, safer or less expensive or that reach the market sooner than BGL’s future tests, if any, BioNexus may not achieve commercial success.
In addition, many universities and private and public research institutes may become active in MRNA Scientific’s target disease areas. If MRNA Scientific’s competitors market products that are more effective, safer or less expensive or that reach the market sooner than MRNA Scientific’s future tests, if any, BioNexus may not achieve commercial success.
The rights of shareholders to take legal action against us and BioNexus’ directors, actions by minority shareholders and the fiduciary responsibilities of its directors are to a large extent governed by the common law of Malaysia.
The rights of shareholders to take legal action against us and our directors, actions by minority shareholders and the fiduciary responsibilities of its directors are to a large extent governed by the common law of Malaysia.
We are currently a “smaller reporting company”, meaning that we are not an investment company, an asset- backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and annual revenues of less than $50.0 million during the most recently completed fiscal year.
We are currently a “smaller reporting company”, meaning that we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and annual revenues of less than $100 million during the most recently completed fiscal year.
While BGL believes that its tests help detect the potential risk of different diseases, the specificity and sensitivity of those tests have not been determined in clinical trials let alone those that meet the scope or standards of clinical trials that would satisfy regulators in the United States or the European Union.
While MRNA Scientific believes that its tests help detect the potential risk of different diseases, the specificity and sensitivity of those tests have not been determined in clinical trials let alone those that meet the scope or standards of clinical trials that would satisfy regulators in the United States or the European Union.
BGL’s proprietary software underlying its diagnosis is highly complex and may contain undetected errors or vulnerabilities, some of which may only be discovered after a diagnosis. This may result in an inaccurate diagnosis which could expose us to substantial liability due to the misdiagnosis.
MRNA Scientific’s proprietary software underlying its diagnosis is highly complex and may contain undetected errors or vulnerabilities, some of which may only be discovered after a diagnosis. This may result in an inaccurate diagnosis which could expose us to substantial liability due to the misdiagnosis.
The availability of additional capital, whether from private capital sources (including banks) or the public capital markets, fluctuates as BioNexus’ financial condition and market conditions in general change.
The availability of additional capital, whether from private capital sources (including banks) or the public capital markets, fluctuates as our financial condition and market conditions in general change.
BGL expects to continue to add personnel in the areas of sales and marketing, research & development, laboratory operations, finance, quality assurance and compliance. As BGL builds its commercialization efforts and expands research and development activities, operating expenses and capital requirements will increase, and BGL expects that they will continue to increase, significantly.
MRNA Scientific expects to continue to add personnel in the areas of sales and marketing, research & development, laboratory operations, finance, quality assurance and compliance. As MRNA Scientific builds its commercialization efforts and expands research and development activities, operating expenses and capital requirements will increase, and MRNA Scientific expects that they will continue to increase, significantly.
Some open-source licenses may contain certain unfavorable conditions, such as requirements that BGL disclose source code for modifications or derivative works that the company makes to the open-source software and that the company license such modifications or derivative works to third parties at no cost or under the terms of the particular open-source license.
Some open-source licenses may contain certain unfavorable conditions, such as requirements that MRNA Scientific disclose source code for modifications or derivative works that the company makes to the open-source software and that the company license such modifications or derivative works to third parties at no cost or under the terms of the particular open-source license.
A potential conflict of interest may arise in the future that may cause BioNexus’ business to fail, including conflicts of interest in allocating their time to the company and their other business interests.
A potential conflict of interest may arise in the future that may cause our business to fail, including conflicts of interest in allocating their time to the company and their other business interests.
These and other factors beyond BGL’s control could delay its launch of enhanced, improved, or new test and test candidates. The research and development process in the biotechnology industry generally requires a significant amount of time from the research and design stage through commercialization.
These and other factors beyond MRNA Scientific’s control could delay its launch of enhanced, improved, or new test and test candidates. The research and development process in the biotechnology industry generally requires a significant amount of time from the research and design stage through commercialization.
In the development of enhanced, improved, or new test and test candidates, BioNexus can provide no assurance that: · BGL will develop any tests that meet its desired target product profile and address the relevant clinical need or commercial opportunity; · any tests that BGL develop will prove to be effective in clinical trials, platform validations, or otherwise; 29 Table of Contents · BGL will obtain necessary regulatory authorizations, in a timely manner or at all; · any tests that BGL develop will be successfully marketed to and ordered by healthcare providers; · any tests that BGL develop will be produced at an acceptable cost and with appropriate quality; · its current or future competitors will not introduce tests similar to ours that have superior performance, lower prices, or other characteristics that cause healthcare providers to recommend, and consumers to choose, such competitive tests over ours; or · third parties do not or will not hold patents in any key jurisdictions that would be infringed by its tests.
In the development of enhanced, improved, or new test and test candidates, we can provide no assurance that: MRNA Scientific will develop any tests that meet its desired target product profile and address the relevant clinical need or commercial opportunity; · any tests that MRNA Scientific develop will prove to be effective in clinical trials, platform validations, or otherwise; · MRNA Scientific will obtain necessary regulatory authorizations, in a timely manner or at all; · any tests that MRNA Scientific develop will be successfully marketed to and ordered by healthcare providers; · any tests that MRNA Scientific develop will be produced at an acceptable cost and with appropriate quality; · its current or future competitors will not introduce tests similar to ours that have superior performance, lower prices, or other characteristics that cause healthcare providers to recommend, and consumers to choose, such competitive tests over ours; or · third parties do not or will not hold patents in any key jurisdictions that would be infringed by its tests.
If an author or other third party that distributes such open-source software were to allege that BGL had not complied with the conditions of an open-source license, the company could incur significant legal costs defending itself against such allegations.
If an author or other third party that distributes such open-source software were to allege that MRNA Scientific had not complied with the conditions of an open-source license, the company could incur significant legal costs defending itself against such allegations.
In addition, while BGL has implemented security measures and a formal, dedicated enterprise security program to prevent unauthorized access to patient data, such data is currently accessible through multiple channels, and there is no guarantee BGL can protect its data from breach.
In addition, while MRNA Scientific has implemented security measures and a formal, dedicated enterprise security program to prevent unauthorized access to patient data, such data is currently accessible through multiple channels, and there is no guarantee MRNA Scientific can protect its data from breach.
As BGL plan to set up RNA screening labs operations in Indonesia, Middle East, USA, China and Germany, if approved, its businesses are subject to risks associated with doing business outside Malaysia including an increase in BioNexus’ expenses, diversion of BioNexus’ management’s attention from the research and development of additional diseases/disorders risk detection or forgoing profitable licensing opportunities in these economies.
As MRNA Scientific plans to set up RNA screening labs operations in Indonesia, Middle East, USA, China and Germany, if approved, its businesses are subject to risks associated with doing business outside Malaysia including an increase in BioNexus’ expenses, diversion of BioNexus’ management’s attention from the research and development of additional diseases/disorders risk detection or forgoing profitable licensing opportunities in these economies.
You could lose all or part of your investment due to any of these risks. Risk Factors Related to Our Financial Prospects and Capitalization BioNexus is an early, commercial-stage company and have a limited operating history, which may make it difficult to evaluate our current business and predict our future performance.
You could lose all or part of your investment due to any of these risks. Risk Factors Related to Our Financial Prospects and Capitalization We are an early commercial-stage company and have a limited operating history, which may make it difficult to evaluate our current business and predict our future performance.
While the company’s officers have verbally agreed to devote sufficient time and attention to the affairs of the Company, it has no written arrangement with BioNexus’ officers regarding this matter. As a result, BioNexus may face conflicts between business decisions that they may have to make regarding its operations and that of their other business interests.
While the company’s officers have verbally agreed to devote sufficient time and attention to the affairs of the Company, it has no written arrangement with our officers regarding this matter. As a result, we may face conflicts between business decisions that they may have to make regarding its operations and that of their other business interests.
The marketing, sale and use of BGL’s products and services could result in substantial damages arising from products or service liability or professional liability claims, that exceed BGL’s resources. Due to the nature of BGL’s business, it may face claims for products or service liability.
The marketing, sale and use of MRNA Scientific’s products and services could result in substantial damages arising from products or service liability or professional liability claims, that exceed MRNA Scientific’s resources. Due to the nature of MRNA Scientific’s business, it may face claims for products or service liability.
Due to differences in the hardware and software platforms available at different laboratories for running molecular tests, BGL’s may need to adjust the configuration of the reagents and there may be changes to the related software in order for the tests to be performed on particular hardware platforms.
Due to differences in the hardware and software platforms available at different laboratories for running molecular tests, MRNA Scientific’s may need to adjust the configuration of the reagents and there may be changes to the related software in order for the tests to be performed on particular hardware platforms.
The results of Chemrex’s operations are sensitive to volatility in the cost of raw materials, particularly fibre reinforced plastics. Chemrex, as a reseller, rely on outside vendors to supply us with raw materials, including fibre reinforced plastics. Chemrex purchase most of its primary raw material, from numerous other sources located throughout Malaysia and internationally.
The results of Chemrex’s operations are sensitive to volatility in the cost of raw materials, particularly fibre reinforced plastics. Chemrex, as a reseller, relies on outside vendors to supply us with raw materials, including fibre reinforced plastics. Chemrex purchases most of its primary raw material, from numerous other sources located throughout Malaysia and internationally.
Prices of these chemical raw materials are volatile and are influenced by changes exports in response to demands of Chemrex’s global competitors and customers, as well as currency fluctuations. At any given time, BioNexus may be unable to obtain an adequate supply of these chemical raw materials with price and other terms acceptable to us.
Prices of these chemical raw materials are volatile and are influenced by export changes in response to demands of Chemrex’s global competitors and customers, as well as currency fluctuations. At any given time, Chemrex may be unable to obtain an adequate supply of these chemical raw materials with price and other terms acceptable to us.
Towards a new recovery phase in 2022, most businesses and organizational functions were prioritizing our spending or postpone any tasks and events that do not bring any value to the current situation because even when the challenges are successfully addressed, this will not guarantee any promising future.
Towards a new recovery phase in 2023, most businesses and organizational functions were prioritizing our spending or postponing any tasks and events that do not bring any value to the current situation because even when the challenges are successfully addressed, this will not guarantee any promising future.
BGL’s ability to manage its growth effectively requires us to forecast expenses accurately, and to properly forecast and expand operational and testing facilities, if necessary, to expend funds to improve our operational, financial and management controls, reporting systems and procedures.
MRNA Scientific’s ability to manage its growth effectively requires us to forecast expenses accurately, and to properly forecast and expand operational and testing facilities, if necessary, to expend funds to improve our operational, financial and management controls, reporting systems and procedures.
In particular, BGL face a number of challenges relating to data inter-connected with regional labs, including: · protecting the data in and hosted on BGL’s system, including against hacking on BGL’s system by outside parties or its employees; · addressing concerns related to privacy and sharing, safety, security and others; · complying with applicable laws, rules and regulations relating to the collection, use, disclosure of personal information, including any requests from regulatory and government authorities relating to such data; · Any systems failure or security breach or lapse those results in the release of user data could harm BGL’s reputation and brand and, consequently, BGL’s business, in addition to exposing us to potential legal liability.
In particular, MRNA Scientific face a number of challenges relating to data inter-connected with regional labs, including: 22 Table of Contents · protecting the data in and hosted on MRNA Scientific’s system, including against hacking on MRNA Scientific’s system by outside parties or its employees; · addressing concerns related to privacy and sharing, safety, security and others; · complying with applicable laws, rules and regulations relating to the collection, use, disclosure of personal information, including any requests from regulatory and government authorities relating to such data; · Any systems failure or security breach or lapse those results in the release of user data could harm MRNA Scientific’s reputation and brand and, consequently, MRNA Scientific’s business, in addition to exposing us to potential legal liability.
BGL’s plan for expanding its business includes developing and acquiring additional tests or additional biomarkers that can be transferred into its current and future diagnostic product portfolio and distributed in target markets.
MRNA Scientific’s plan for expanding its business includes developing and acquiring additional tests or additional biomarkers that can be transferred into its current and future diagnostic product portfolio and distributed in target markets.
If BGL were to conduct such clinical trials, the results might prove to be less successful than we anticipate, and such tests might not be approved for sale in markets that require such clinical trials.
If MRNA Scientific were to conduct such clinical trials, the results might prove to be less successful than we anticipate, and such tests might not be approved for sale in markets that require such clinical trials.
Moreover, litigation or adverse publicity resulting from these allegations could materially and adversely affect BGL’s business, regardless of whether the allegations are valid or whether the company is liable. Currently BGL has no products and service liability insurance coverage, and even if there was such coverage, such coverage might not be sufficient to properly protect BGL.
Moreover, litigation or adverse publicity resulting from these allegations could materially and adversely affect MRNA Scientific’s business, regardless of whether the allegations are valid or whether the company is liable. Currently MRNA Scientific has no products and service liability insurance coverage, and even if there was such coverage, such coverage might not be sufficient to properly protect MRNA Scientific.
Any such unauthorized access, loss, or dissemination of information could also result in legal claims or proceedings, liabilities under Malay laws and regulations in relation to the protection of personal information and cybersecurity as well as those specifically governing patient and medical data. BGL shall establish, maintain and execute internal systems to safeguard relevant personal healthcare data.
Any such unauthorized access, loss, or dissemination of information could also result in legal claims or proceedings, liabilities under Malaysian laws and regulations in relation to the protection of personal information and cybersecurity as well as those specifically governing patient and medical data. MRNA Scientific shall establish, maintain and execute internal systems to safeguard relevant personal healthcare data.
In addition, the continued growth of BioNexus’ business depends on its ability to hire additional qualified personnel with expertise in molecular biology, chemistry, biological information processing, software, engineering, sales, marketing, and technical support. BioNexus compete for qualified management and scientific personnel with other life science and technology companies, universities, and research institutions in Malaysia and overseas.
In addition, the continued growth of our business depends on our ability to hire additional qualified personnel with expertise in molecular biology, chemistry, biological information processing, software, engineering, sales, marketing, and technical support. We compete for qualified management and scientific personnel with other life science and technology companies, universities, and research institutions in Malaysia and overseas.
The availability and prices of raw materials may also be negatively affected by new laws and regulations, allocation by suppliers, interruptions in production, accidents or natural disasters, changes in exchange rates, worldwide price fluctuations, and the availability and cost of transportation. 33 Table of Contents If Chemrex’s suppliers increase the prices of its chemical raw materials, BioNexus may not have alternative sources of supply.
The availability and prices of raw materials may also be negatively affected by new laws and regulations, allocation by suppliers, interruptions in production, accidents or natural disasters, changes in exchange rates, worldwide price fluctuations, and the availability and cost of transportation. If Chemrex’s suppliers increase the prices of its chemical raw materials, Chemrex may not have alternative sources of supply.
Raising additional capital may lead to dilution of shareholdings by BioNexus’ existing shareholders, restrict BioNexus’ operations, and may further result in fair value loss, adversely affecting BioNexus’ financial results. BioNexus may seek additional funding through a combination of equity and debt financings and collaborations.
Raising additional capital may lead to dilution of shareholdings by our existing shareholders, restrict our operations, and may further result in fair value loss, adversely affecting our financial results. We may seek additional funding through a combination of equity and debt financings and collaborations.
There is little legal precedent governing the interpretation of many of the terms of these licenses, and the potential impact of these terms on BioNexus’ business may result in unanticipated obligations regarding its technologies.
There is little legal precedent governing the interpretation of many of the terms of these licenses, and the potential impact of these terms on our business may result in unanticipated obligations regarding our technologies.
There may be times when the private capital sources and the public capital markets lack sufficient liquidity or when BioNexus’ securities cannot be sold at attractive prices or at all, in which case BioNexus would not be able to access capital from these sources.
There may be times when the private capital sources and the public capital markets lack sufficient liquidity or when our securities cannot be sold at attractive prices or at all, in which case we would not be able to access capital from these sources.
Even if a license is available, BioNexus could be required to pay significant royalties or submit to unreasonable terms, which would increase its operating expenses. BioNexus may also be required to develop alternative non-infringing technology, which could require significant time and expense.
Even if a license is available, we could be required to pay significant royalties or submit to unreasonable terms, which would increase our operating expenses. We may also be required to develop alternative non-infringing technology, which could require significant time and expense.
Effective execution of research and development activities and the timely introduction of enhanced, improved, or new tests and test candidates to the market are important elements of BGL’s business strategy. For example, BGL is currently collaborating with the National Heart Institute in Malaysia to identify genomic signatures in acute myocardial infarctions.
Effective execution of research and development activities and the timely introduction of enhanced, improved, or new tests and test candidates to the market are important elements of MRNA Scientific’s business strategy. For example, MRNA Scientific is currently collaborating with the National Heart Institute in Malaysia to identify genomic signatures in acute myocardial infarctions.
We cannot assure you that fluctuations in foreign currencies exchange rates, particularly the strengthening or weakening of the U.S. dollar against Malaysian currency would not materially affect our financial results. 26 Table of Contents Risk Related to BGL’s Business and Industry Exponential growth in Biotechnology Biotechnology is a rapidly changing field that continues to transform both in scope and impact.
We cannot assure you that fluctuations in foreign currencies exchange rates, particularly the strengthening or weakening of the U.S. dollar against Malaysian currency would not materially affect our financial results. Risk Related to MRNA Scientific’s Business and Industry Exponential growth in Biotechnology Biotechnology is a rapidly changing field that continues to transform both in scope and impact.
BioNexus’ competitiveness and growth depend on our ability to fund our capital expenditures. BioNexus cannot assure you that it will be able to fund our capital expenditures at reasonable costs due to adverse macroeconomic conditions, our performance or other external factors. In the future, BioNexus expects to incur significant costs in connection with its operations.
Our competitiveness and growth depend on our ability to fund our capital expenditures. We cannot assure you that it will be able to fund our capital expenditures at reasonable costs due to adverse macroeconomic conditions, our performance or other external factors. In the future, we expect to incur significant costs in connection with its operations.
This may include additional licenses and license fees needed for reagents or components required hereto as well. BGL’s biomarkers have not undergone clinical trials. As there are no governmental regulations that materially restrict our screening business in Malaysia, BGL has not conducted clinical trials on its biomarkers.
This may include additional licenses and license fees needed for reagents or components required hereto as well. MRNA Scientific’s biomarkers have not undergone clinical trials. As there are no governmental regulations that materially restrict our screening business in Malaysia, MRNA Scientific has not conducted clinical trials on its biomarkers.
Further, claims of this type, whether substantiated or not, may divert BGL’s financial and management resources from revenue generating activities and the business operation. BGL may face technology transfer challenges and expenses in adding new tests to its portfolio and in expanding its reach into new geographical areas.
Further, claims of this type, whether substantiated or not, may divert MRNA Scientific’s financial and management resources from revenue generating activities and the business operation. MRNA Scientific may face technology transfer challenges and expenses in adding new tests to its portfolio and in expanding its reach into new geographical areas.
As a result of these factors, BGL’s competitors may succeed in obtaining patent protection and/or FDA approval or discovering, developing and commercializing screening process for cancer, inflammation, osteoarthritis and many more indications. 31 Table of Contents In addition, smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies.
As a result of these factors, MRNA Scientific’s competitors may succeed in obtaining patent protection and/or FDA approval or discovering, developing and commercializing screening process for cancer, inflammation, osteoarthritis and many more indications. In addition, smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large, established companies.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe two investment properties are listed below. · A 1,100 sqft condominium located at No. Unit 2B-17-03, Duet Residence, Jalan Kinrara 6, Bandar Kinrara, 47180 Puchong, Selangor, purchased on August 26, 2020; · A 2,000 sqft commercial building located at First floor, No. 2B Pelangi Avenue, Jalan Kelicap 42A/KU1, Klang Bandar, Diraja, 41050 Klang, Selangor purchased on September 21, 2020.
Biggest changeUnit 2B-17-03, Duet Residence, Jalan Kinrara 6, Bandar Kinrara, 47180 Puchong, Selangor, purchased on August 26, 2020; · A 2,000 sq ft commercial building located at First floor, No. 2B Pelangi Avenue, Jalan Kelicap 42A/KU1, Klang Bandar, Diraja, 41050 Klang, Selangor purchased on September 21, 2020. · On January 18, 2024, we entered into a lease for the first-floor unit at No. 5-1, Jalan CJ3/13-2, Pusat Bandar Cheras Jaya, 43200 Cheras, Selangor.
Item 2. Properties. Our corporate office for BGL is located at Unit 2, level, Tower B, Avenue 3, The Vertical Business Suite II, Bangsar South, 8 Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia. The lease commenced on December 16, 2018 and terminates on December 15, 2024. The space consists of 1,300 square feet with an annual rent of approximately $13,500.
Item 2. Properties. The corporate office for MRNA Scientific is located at Unit 2, level, Tower B, Avenue 3, The Vertical Business Suite II, Bangsar South, 8 Jalan Kerinchi, 59200 Kuala Lumpur, Malaysia. The lease commenced on December 16, 2018 and terminates on December 15, 2024. The space consists of 1,300 square feet with an annual rent of approximately $13,500.
The space consists of 1,500 square feet with an annual rent of approximately $7,300. 39 Table of Contents On July 2, 2012, we purchased a 25,000 sq. ft wholesale distribution center located at 4, Jalan CJ 1/6, Kawasan Perusahaan Cheras Jaya, 43200 Cheras, Selangor, Malaysia, and two investment properties for $1,506,969.
The lease commenced on December 1, 2017 and terminates on November 30, 2024. The space consists of 1,500 square feet with an annual rent of approximately $7,300. On July 2, 2012, we purchased a 25,000 sq. ft wholesale distribution center located at 4, Jalan CJ 1/6, Kawasan Perusahaan Cheras Jaya, 43200 Cheras, Selangor, Malaysia, and two investment properties for $1,506,969.
On January 18, 2023, we entered into a lease for the first-floor unit at No. 5-1, Jalan CJ3/13-2, Pusat Bandar Cheras Jaya, 43200 Cheras, Selangor. The lease commenced on 18 January 2023 and terminates on January 17, 2024. The purpose of this lease is to provide accommodation for our warehouse staff.
The lease terminates on January 17, 2025. The purpose of this lease is to provide housing accommodation for our warehouse staff.
Removed
The lease commenced on December 1, 2017 and terminates on November 30, 2024.
Added
The two investment properties are listed below. · A 1,100 sq ft condominium located at No.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 4. Mine Safety Disclosures. None. 40 Table of Contents PART II
Biggest changeItem 4. Mine Safety Disclosures. None. 30 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 40 PART II Item 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6 Selected Financial Data 41 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 42
Biggest changeItem 4. Mine Safety Disclosures 30 PART II Item 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 31 Item 6. Selected Financial Data 32 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 32

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information On March 11, 2020, FINRA authorized the trading of BioNexus’ common stock under the symbol “BGLC”, however, we began trading on the OTC-QB markets in September 2020.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
As of the date of this filing, there are 173,718,152 shares of our common stock issued and outstanding that was held by 316 stockholders of record and no shares of preferred stock issued and outstanding.
As of the date of this filing, there are 17,667,663 shares of our common stock issued and outstanding that was held by 324 stockholders of record and no shares of preferred stock issued and outstanding.
The issuance of any of our Common Stock or Preferred Stock is within the discretion of our board of directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval. Recent Sales of Unregistered Securities. None Issuer Purchases of Equity Securities None
The issuance of any of our Common Stock or Preferred Stock is within the discretion of our board of directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval up to the limits set by NASDAQ listing rules Recent Sales of Unregistered Securities.
Any trading has been sporadic and there has been no meaningful trading volume. Capital Stock : Our authorized capital stock consists of 300,000,000 shares of common stock, no par value per share, and 30,000,000 shares of preferred stock, no par value per share.
Capital Stock : Our authorized capital stock consists of 300,000,000 shares of common stock, no par value per share, and 30,000,000 shares of preferred stock, no par value per share.
Removed
The table below sets forth, for the fiscal quarters indicated, the high and low bid prices per share of our common stock as reflected on the OTC-QB markets. The quotations represent inter-dealer prices without adjustment for retail markups, markdowns or commissions, and may not necessarily represent actual transactions.
Added
On July 20, 2023, the Company entered into an underwriting agreement (the "Underwriting Agreement") with Network 1 Financial Securities, Inc., as underwriter (the "Underwriter") pursuant to which the Company agreed to issue and sell, in a firm commitment underwritten public offering by the Company (the "Offering") of 1,250,000 shares of common stock, no par value, priced at a public offering price of $4.00 per share.
Removed
The bid prices set forth below reflect inter-dealer quotations, do not include retail markups, markdowns or commissions and do not necessarily reflect actual transactions.
Added
In addition, pursuant to the Underwriting Agreement, the Underwriter was granted a 45-day option (the "Over-Allotment Option") to purchase up to an additional 187,500 shares of common stock at the public offering price of $4.00 per share. The Underwriter fully exercised the Over-Allotment Option on July 24, 2023.
Removed
High Low Fiscal Year Ended December 31, 2022 First Quarter $ 2.23 $ 1.10 Second Quarter $ 1.73 $ 1.01 Third Quarter $ 1.18 $ 0.16 Fourth quarter $ 1.08 $ 0.72 Fiscal Year Ended December 31, 2021 Third Quarter $ 1.86 $ 1.00 Fourth Quarter $ 2.25 $ 1.00 The OTC-QB is a quotation system and not a national securities exchange, and many companies have experienced limited liquidity when traded through this quotation system.
Added
The securities were offered by the Company pursuant to the registration statement on Form S-1 (File No. 333-269753), which was originally filed with the U.S. Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended, on February 14, 2023, and declared effective by the Commission on July 19, 2023.
Added
On July 24, 2023, the Offering closed, and the Company issued and sold 1,437,500 shares of common stock, including 187,500 shares sold pursuant to the exercise of the Over-Allotment Option. The Offering was priced at $4.00 per share for total gross proceeds of $5.75 million before deducting underwriting discounts, commissions, and offering expenses.
Added
Pursuant to the Underwriting Agreement, the Underwriter received an 8% underwriting discount on the public offering price for the shares common stock. The Company therefore received net proceeds, before expenses, of $5,290,000 from the sale of the common stock.
Added
In addition, the Company issued to the Underwriter warrants to purchase up to an aggregate of 115,000 shares of the Company's common stock (the "Underwriter's Warrants") at an exercise price of $4.40 per share. The Underwriter's Warrants are exercisable from July 24, 2023 until July 24, 2028.
Added
In August 2023, an aggregate of 759,299 shares of common stock were issued to professional parties in lieu of cash for services rendered in connection with Company’s listing onto the Nasdaq Capital Market, 125,000 were subsequently cancelled in November, 2023. The shares were issued at $0.72 per share.
Added
These issuances were made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. In August 2023, an aggregate of 75,000 shares of common stock were issued to directors for services rendered. The shares were issued at $0.72 per share.
Added
These issuances were made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. Issuer Purchases of Equity Securities None 31 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeBioNexus Malaysia and Chemrex BioNexus Malaysia Chemrex BioNexus Malaysia Chemrex Year ended December 31, 2022 Year ended December 31, 2021 REVENUE $ 95,816 $ 10,832,891 $ 1,515,673 $ 11,846,894 COST OF REVENUE (51,465 ) (9,618,213 ) (1,052,938 ) (10,042,688 ) GROSS PROFIT 44,351 1,214,678 462,735 1,804,206 OTHER INCOME 8,830 170,453 7,467 59,024 OPERATING EXPENSES General and administrative (286,753 ) (1,051,855 ) (160,094 ) (989,617 ) FINANCE COSTS (5,657 ) (6,822 ) (4,158 ) (8,815 ) (LOSS)/PROFIT BEFORE TAX (239,229 ) 326,454 305,950 864,798 Tax expense : Deferred tax (1,428 ) (2,470 ) (11,997 ) (14,739 ) Income tax - (48,412 ) (30,482 ) (234,065 ) Total tax expense (1,428 ) (50,882 ) (42,479 ) (248,804 ) NET (LOSS)/PROFIT $ (240,657 ) $ 275,572 $ 263,471 $ 615,994 Revenue.
Biggest changeMRNA Scientific and Chemrex MRNA Scientific Chemrex MRNA Scientific Chemrex Year ended Year ended December 31, 2023 December 31, 2022 REVENUE $ 24,219 $ 9,746,587 $ 95,816 $ 10,832,891 COST OF REVENUE (19,851 ) (8,421,457 ) (51,465 ) (9,618,213 ) GROSS PROFIT 4,368 1,325,130 44,351 1,214,678 OTHER INCOME 19,629 466,407 8,830 170,453 OPERATING EXPENSES General and administrative (245,747 ) (2,019,001 ) (286,753 ) (1,051,855 ) FINANCE COSTS (5,052 ) (8,877 ) (5,657 ) (6,822 ) (LOSS)/PROFIT BEFORE TAX (226,802 ) (236,641 ) (239,229 ) 326,454 Tax expense : Deferred tax 12,269 5,090 (1,428 ) (2,470 ) Income tax (2,613 ) (36,272 ) - (48,412 ) Total tax expense 9,656 (31,182 ) (1,428 ) (50,882 ) NET (LOSS)/PROFIT $ (217,146 ) $ (267,523 ) $ (240,657 ) $ 275,572 34 Table of Contents Revenue.
Investing Activities During the year ended December 31, 2022, the Company had net cash of $450,498 used in investment activities from acquisition of share investment of $511,706, purchase of plant & equipment of $54,171 and cash generated from dividend income of $115,379.
During the year ended December 31, 2022, the Company had net cash acquisition of share investment of $511,706, purchase of plant & equipment of $54,171 and cash generated from dividend income of $115,379, resulting in net cash used in investing activities of $ 450,498.
The following trends are reasonably likely to result in a material decrease in our liquidity over the near to long term: · Addition of administrative and marketing personnel as the business grows, · Development and patenting data analysis algorithm software, · Increases in advertising and marketing in order to attempt to generate more revenues, and · The cost of being a public company. 45 Table of Contents The Company believes that cash flow from operations together will be sufficient to sustain its current level of operations for at least the next 12 months of operations.
The following trends are reasonably likely to result in a material decrease in our liquidity over the near to long term: · Addition of administrative and marketing personnel as the business grows, · Development and patenting data analysis algorithm software, · Increases in advertising and marketing in order to attempt to generate more revenues, and · The cost of being a public company. 35 Table of Contents The Company believes that cash flow from operations together will be sufficient to sustain its current level of operations for at least the next 12 months of operations.
Consequently, the following discussion and analysis of the results of operations and financial condition of the Company is for fiscal years ended December 31, 2022 and December 31, 2021, respectively. This information should be read in conjunction with the notes to the financial statements that are included elsewhere herein.
Consequently, the following discussion and analysis of the results of operations and financial condition of the Company is for fiscal years ended December 31, 2023 and December 31, 2022, respectively. This information should be read in conjunction with the notes to the financial statements that are included elsewhere herein.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. General . BioNexus was incorporated in the State of Wyoming on May 12, 2017 and operations of our Malaysian company began operations in July 2017.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. General . We were incorporated in the State of Wyoming on May 12, 2017 and operations of our Malaysian company began operations in July 2017.
For the year ended December 31, 2022 we had cost of revenues of $9,669,678 as compared to cost of revenues of $11,095,626 for the year ended December 31, 2021, a decrease of approximately 12.9% due to lower sales caused by the above reasons. Other Income .
For the year ended December 31, 2023, we had cost of revenues of $8,441,308 as compared to cost of revenues of $9,669,678 for the year ended December 31, 2022, a decrease of approximately 12.7% due to lower sales caused by the above reasons. Other Income .
Bhd., focuses on the sale of chemical raw materials for the manufacture of industrial, medical, appliance, aero, automotive, mechanical, and electronic industries in the Southeast Asia region. These countries include Malaysia, Indonesia, Vietnam, and other countries in Southeast Asia.
Company Overview The Company, through its wholly owned subsidiary Chemrex, focuses on the sale of chemical raw materials for the manufacture of industrial, medical, appliance, aero, automotive, mechanical, and electronic industries in the Southeast Asia region. These countries include Malaysia, Indonesia, Vietnam, and other countries in Southeast Asia.
Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this quarterly report, which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects. Company Overview BioNexus Gene Lab Corp., through our wholly owned subsidiary Chemrex Corporation Sdn.
Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this quarterly report, which are designed to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects.
For the year ended December 31, 2022, we had other income of $179,283 as compared to other income of $66,491 for the year ended December 31, 2021, an increase of 169.6% for current year.
For the year ended December 31, 2023, we had other income of $486,036 as compared to other income of $179,283 for the year ended December 31, 2022, an increase of 171.1% for current year.
The decrease of 4.23% in Chemrex’s cost of revenues was due to its decreased in revenues and reasons stated above. BioNexus had incurred $51,465 (0.5%) on cost of revenues for the year ended December 31, 2022 as compared to cost of revenues of $1,052,938 (9.5%) for the same year ended December 31, 2021.
The decrease of 12.44% in Chemrex’s cost of revenues was due to its decreased in revenues and reasons stated above. MRNA Scientific had incurred $19,851 (0.2%) on cost of revenues for the year ended December 31, 2023, as compared to cost of revenues of $51,465 (0.5%) for the same year ended December 31, 2022.
For the year period ended December 31, 2022, Chemrex had incurred $9,618,213 (99.5%) of the total combined cost of revenue of $9,669,678 as compared to the year ended December 31, 2021 wherein Chemrex had incurred $10,042,688 (90.5%) of the total combined cost of revenue of $11,095,626.
For the year period ended December 31, 2023, Chemrex had incurred $8,421,457 (99.8%) of the total combined cost of revenue of $ 8,441,308 as compared to the year ended December 31, 2022, wherein Chemrex had incurred $9,618,213 (99.5%) of the total combined cost of revenue of $9,669,678.
The decrease of 95.1% was due to the buying less extract kits, reagents, laboratory consumables for covid-19 samples processing. Other Income .
The decrease of 61.4% was due to less purchases of extract kits, reagents, laboratory consumables for Covid-19 samples processing attributable to our reduced sales. Other Income .
Furthermore, the Company is also in the business of developing and providing safe, effective, and non-invasive liquid biopsy tests for the early detection of biomarkers that we believe are linked to diseases to minimize treatment costs and improve patient management. Our non-invasive blood tests provide analysis of changes in RNA to detect the potential risk of 11 different diseases.
In addition, the Company, through our other wholly owned subsidiary, MRNA Scientific, is in the business of developing and providing safe, effective, and non-invasive liquid biopsy tests for the early detection of biomarkers that we believe are linked to diseases to minimize treatment costs and improve patient management.
By comparison, during the year ended December 31, 2021, the Company had a net profit of $751,571 which, after adjusting for amortization, depreciation, dividend income, fair value on investment, an increase in inventories, trade receivables and deposits, a substantial reduction in trade payables, operating lease liabilities, resulted in net cash of $9,161 being generated from operating activities during the period.
By comparison, during the year ended December 31, 2022, the Company had a net loss of $355,966 which, after adjusting for amortization, depreciation, dividend income, fair value loss on share investments and a decrease in inventories, trade receivables, deferred cost of revenue, a substantial reduction in trade payables, operating lease liabilities, advance payment from customer, deferred revenue, resulted in net cash of $551,822 being generated from operating activities during the period.
For the year ended December 31, 2022, Chemrex had incurred $1,051,855 (78.6%) of the total combined operating expenses of $1,338,608 for the year ended December 31, 2022 as compared to the operating expenses of $989,617 (86.1%) for the year ended December 31, 2021.
For the year ended December 31, 2023, Chemrex had incurred $2,019,001 (45.8%) of the total combined operating expenses of $4,409,122 for the year ended December 31, 2023, as compared to the operating expenses of $1,051,855 (78.6%) for the year ended December 31, 2022.
Financing Activities During the year ended December 31, 2022, Company had net cash of $115,962 generated from financing activities for 2.5 million shares subscriptions of $150,000 and fully repayment of a finance lease of $34,038.
By comparison, during the year ended December 31, 2022, we had net cash of $108,168 generated from financing activities for 2.5 million shares subscriptions of $150,000 and fully repayment of a finance lease of $34,038. Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Not applicable to smaller reporting companies.
For the year ended December 31, 2022, we had the total tax expense of $52,310 from deferred tax of $3,898 and tax provision of $48,412. The year ended December 31, 2021 the total tax expenses were $291,283 from deferred tax of $26,736 and income tax provision of $264,547.
For the year ended December 31, 2023, we had the total tax expense of $21,526 from deferred tax credit of $17,359 and tax provision of $38,885. The year ended December 31, 2022, the total tax expenses were $ 52,310 from deferred tax of $3,898 and income tax provision of $48,412. Foreign currency translation loss .
Income tax expense . Chemrex had total tax expenses of $50,882 (97.3%) from deferred tax of $2,470 and tax provision of $48,412 for the year ended December 31, 2022 as compared to total tax expense of $248,804 (85.42%) for the last year ended December 31, 2021 from deferred tax of $14,739 and tax provision of $234,065.
Chemrex had total tax expenses of $31,182 (144.9.%) from deferred tax credit of $5,090 (29.3%) and tax provision of $36,272 (93.3%) for the year ended December 31, 2023, as compared to the last year ended December 31, 2022, total tax expenses of $50,882 (97.3%) from deferred tax of $2,470 and tax provision of $48,412.
The following is a summary of the Company’s cash flows provided by (used in) / generated from operating, investing, and financing activities for the year ended December 31, 2022 and 2021: Year ended December 31, 2022 2021 Net Cash generated from operating activities $ 544,028 $ 9,161 Net cash used in investing activities (450,498 ) (490,574 ) Net cash generated from/(used in) financing activities 115,962 (28,222 ) Foreign currency translation adjustment (214,547 ) (154,138 ) Net Change in Cash and Cash Equivalents $ (5,055 ) $ (663,773 ) Operating Activities During the year ended December 31, 2022, the Company incurred a net loss of $355,966 which, after adjusting for amortization, depreciation, dividend income, fair value on investment, a decrease in inventories, trade receivables and deposits, a substantial reduction in trade payables, operating lease liabilities, resulted in net cash of $544,028 being generated from operating activities during the period.
The following is a summary of the Company’s cash flows provided by (used in) / generated from operating, investing, and financing activities for the year ended December 31, 2023, and 2022: Year ended December 31, 2023 2022 Net Cash (used in)/generated from operating activities $ (1,301,595 ) $ 551,822 Net Cash used in investing activities (382,576 ) (450,498 ) Net Cash generated from financing activities 5,754,322 108,168 Foreign currency translation adjustment (259,679 ) (214,547 ) Net Change in Cash and Cash Equivalents $ 3,810,472 $ (5,055 ) Operating Activities During the year ended December 31, 2023, the Company incurred a net loss of $2,629,043 which, after adjusting for amortization, depreciation, dividend income, fair value gain on share investment, allowances for expected credit losses, share-base compensation, an increase in inventories, a decrease in trade receivables and a substantial reduction in trade payables, operating lease liabilities, advance payment from customer, resulted in net cash of $1,301,595 being used in operating activities during the period.
Chemrex had a profit before tax of $326,454 for the year ended December 31, 2022 as compared to $864,798 for the year ended December 31, 2021, a decrease of 62.25% while Bionexus Malaysia incurred a loss of $239,229 for the year ended December 31, 2022, a decrease of 178.2% compared to the year ended December 31, 2021, for the reasons discussed above.
Chemrex had a loss before tax of $267,523 for the year ended December 31, 2023, as compared a profit of $326,454 for the year ended December 31, 2022, an decrease of 18% for the reasons discussed above.
Consolidated Year ended December 31 (Audited) 2022 2021 REVENUE $ 10,928,707 $ 13,362,567 COST OF REVENUE (9,669,678 ) (11,095,626 ) GROSS PROFIT 1,259,029 2,266,941 OTHER INCOME 179,283 66,491 OPERATING EXPENSES General and administrative (1,729,489 ) (1,277,605 ) (LOSS)/PROFIT FROM OPERATIONS (291,177 ) 1,055,827 FINANCE COSTS (12,479 ) (12,973 ) ( LOSS )/PROFIT BEFORE TAX (303,656 ) 1,042,854 Tax expense: Deferred tax (3,898 ) (26,736 ) Income tax (48,412 ) (264,547 ) Total tax expenses (52,310 ) (291,283 ) NET (LOSS)/PROFIT $ (355,966 ) $ 751,571 Other comprehensive income: Foreign currency translation (loss)/gain (308,800 ) (233,946 ) COMPREHENSIVE (LOSS)/ INCOME $ (664,766 ) $ 517,625 Revenues .
Consolidated Year ended December 31 (Audited) 2023 2022 REVENUE $ 9,770,806 $ 10,928,707 COST OF REVENUE (8,441,308 ) (9,669,678 ) GROSS PROFIT 1,329,498 1,259,029 OTHER INCOME 486,036 179,283 OPERATING EXPENSES General and administrative (4,409,122 ) (1,729,489 ) LOSS FROM OPERATIONS (2,965,215 ) (291,177 ) FINANCE COSTS (13,929 ) (12,479 ) LOSS BEFORE TAX (2,607,517 ) (303,656 ) Tax expense: Deferred tax 17,359 (3,898 ) Income tax (38,885 ) (48,412 ) Total tax expenses (21,526 ) (52,310 ) NET LOSS $ (2,629,043 ) $ (355,966 ) Other comprehensive income: Foreign currency translation loss (268,232 ) (308,800 ) COMPREHENSIVE LOSS $ (2,897,275 ) $ (664,766 ) 33 Table of Contents Revenues .
The higher tax expense for 2021 was also due to higher profit in 2021 Foreign currency translation (loss)/gain . We are exposed to fluctuations in foreign exchange rates on the revaluation of monetary assets and liabilities denominated in currencies other than the US Dollar.
We are exposed to fluctuations in foreign exchange rates on the revaluation of monetary assets and liabilities denominated in currencies other than the US Dollar. Therefore, any change in the relevant exchange rate will require us to recognize a transaction gain or loss on revaluation.
During the year ended December 31, 2021, the Company had net cash from acquisition of share investment of $515,840, purchase of plant and equipment and disposal of other investments, resulting in net cash used in financing activities of $490,574.
Investing Activities During the year ended December 31, 2023, the Company had net cash of $382,576 used in investment activities from acquisition of share investment of $320,733, purchase of plant & equipment of $149,398, cash generated from dividend income of $61,409 and disposal of other investments of $26,146.
For the year ended December 31, 2022, Chemrex contributed $170,453 (95.1%) of total other combined income of $179,283 as compared to the year ended December 31, 2021, 59,024 (88.8%) The increase of 188.79% is due to dividend income from equity investment.
For the year ended December 31, 2023, Chemrex contributed $466,407 (96%) of total other combined income of $486,036 as compared to the year ended December 31, 2022, $170,453 (95.1%) The increase of 173.63 % is due to dividend income from its equity investment, bank interest and gain from fair value on investment.
LIQUIDITY AND CAPITAL RESOURCES As of December 31, 2022, we had working capital of $4,017,749 compared with working capital of $4,821,100 as of December 31, 2021. The decreased in working capital as of December 31, 2022 from December 31, 2021 is due principally to the operating loss the Company experienced for the year 2022.
LIQUIDITY AND CAPITAL RESOURCES As of December 31, 2023, we had working capital of $6,415,877 compared with working capital of $4,017,749 as of December 31, 2022. The increase in working capital as of December 31, 2023, from December 31, 2022, is due principally to funds received from the Company’s initial public offering in late 2023.
For the year ended December 31, 2022, Chemrex contributed $10,832,891 (99.1%) of total combined revenue of $10,928,707 compared to its contribution of $11,846,894 (88.66%) of total combined revenue of $13,362,567 for the year ended December 31, 2021, a decrease of 8.56%. The revenue decreased in 2022 was due to the lowering of selling price in view of competition.
For the year ended December 31, 2023, Chemrex contributed $ 9,746,587 (99.8%) of total combined revenue of $9,770,806 compared to its contribution of $10,832,891 (99.1%) of total combined revenue of $10,928,707 for the year ended December 31, 2022, a decrease of 10.6%.
BioNexus had other income of $8,830 (4.9%) for the year ended December 31, 2022 as compared $7,467 (11.2%) for the year ended December 31, 2021, an increase of 18.3% due to bank interest generated from Covid-19 screening’s revenue. Operating Expenses .
The equity investments were made primarily of investments in quoted publicly traded shares. MRNA Scientific had other income of $19,629 (4%) for the year ended December 31, 2023, as compared $8,830 (4.9%) for the year ended December 31, 2022, an increase of 122.3% due to bank interest generated from BGLC’s investment funds Operating Expenses .
Profit/(loss) from operations . We had a loss from operations of $291,177 for the year ended December 31, 2022 compared to a profit from operations of $1,055,827 for the year ended December 31, 2021, a decrease of 127.6% for the reasons discussed above. Tax expense .
The Management of Chemrex continues to take steps to recover any debts. Loss from operations . We had a loss from operations of $2,593,588 for the year ended December 31, 2023, compared to a loss from operations of $291,177 for the year ended December 31, 2022, an increase of 790.7% for the reasons discussed above. Tax expense .
BioNexus Malaysia had deferred tax of $1,428 (2.7%) and no tax provision for current year 2022 as compared to total tax expense of $42,479 (14.58%) for the last year ended December 31, 2021 from deferred tax of $11,997 and tax provision of $30,482.
MRNA Scientific Malaysia had total tax credit of $9,656 (-44.9%) from deferred tax credit of $12,269 (70.7%) and under tax provision for prior year of $2,613 (6.7%) for the year ended December 31, 2023, as compared to the last year ended December 31, 2022, a deferred tax of $1,428 (2.7%) and no tax provision.
Result of Operations Results of Operations for the Year Ended December 31, 2022 Compared to the Year Ended December 31, 2021 (Audited). The following table sets forth key components of the results of operations for fiscal years ended December 31, 2022 and 2021, respectively. As stated herein, on December 31, 2022, BioNexus consummated its acquisition of Chemrex Corporation Sdn. Bhd.
The following table sets forth key components of the results of operations for fiscal years ended December 31, 2023 and 2022, respectively. The discussion following the table addresses these results.
BioNexus Malaysia had incurred $286,753 (21.4%) on operating expenses for the year ended December 31, 2022 as compared to the operating expenses of $160,094 (13.9%) for the year ended December 31, 2021, an increase of 79.1%.
MRNA Scientific had incurred $245,747 (5.1%) of the total combined operating expenses for the year ended December 31, 2023, as compared to the operating expenses of $286,753 (21.4%) of the total combined operating expenses or the year ended December 31, 2022, a decrease of 14.3%.
Therefore, any change in the relevant exchange rate will require us to recognize a transaction gain or loss on revaluation. For the annual period ended December 31, 2022, we had foreign currency translation loss of $308,800 compared with foreign currency translation loss of $233,946 for the prior annual period.
For the annual period ended December 31, 2023, we had foreign currency translation loss of $268,232 compared with foreign currency translation loss of $ 308,800 for the prior annual period.
The increase in other income for the current annual period was due to dividend income from Chemrex’ equity investment and additional fund deposited with the bank resulting from the revenue generated by Covid screening. 43 Table of Contents Operating Expenses .
The increase in other income for the current annual period was due to dividend income from Chemrex’ equity investment, bank interest and gain from fair value on investment. Operating Expenses . For the year ended December 31, 2023, we had operating expenses of $4,409,122 as compared to operating expenses of $1,729,489 for the year ended December 31, 2022.
Removed
(“Chemrex”), pursuant to a Share Exchange Agreement by and among BioNexus and Chemrex and the Chemrex shareholders.
Added
Our non-invasive blood tests provide analysis of changes in RNA to detect the potential risk of 11 different diseases.
Removed
Accordingly, the audited financial information for the period ended December 31, 2022 includes the accounts of Chemrex and BioNexus Malaysia and the (audited) financial information for the period ended December 31, 2021 only includes the accounts of BioNexus Malaysia. 42 Table of Contents The discussion following the table addresses these results.
Added
Initial Public Offering On July 20, 2023, the Company entered into an underwriting agreement (the "Underwriting Agreement") with Network 1 Financial Securities, Inc., as underwriter (the "Underwriter") pursuant to which the Company agreed to issue and sell, in a firm commitment underwritten public offering by the Company (the "Offering") of 1,250,000 shares of common stock, no par value, priced at a public offering price of $4.00 per share.
Removed
For the year ended December 31, 2022, we had revenues of $10,928,707 as compared to revenues of $13,362,567 for the year ended December 31, 2021, a decrease of approximately 18.2% due to after effect of Covid pandemic. The 2021’ revenue of $13,362,567 was partly contributed from Covid-19 screening amounting to $1,515,673 outsourced by Health Ministry to BGL.
Added
In addition, pursuant to the Underwriting Agreement, the Underwriter was granted a 45-day option (the "Over-Allotment Option") to purchase up to an additional 187,500 shares of common stock at the public offering price of $4.00 per share. The Underwriter fully exercised the Over-Allotment Option on July 24, 2023.
Removed
In 2022, all sectors of the economy across the country saw their supply chains interrupted, demand for our products and services decline, shortages and delay in supplies and inputs, we emerged in a very different world compared to the one before the outbreak.
Added
The securities were offered by the Company pursuant to the registration statement on Form S-1 (File No. 333-269753), which was originally filed with the U.S. Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended, on February 14, 2023, and declared effective by the Commission on July 19, 2023.
Removed
Our business was affected because various businesses are facing massive losses due to their declining activities and the accompanying unpredictable future of many businesses. A substantial decrease has been observed in overall spending, which resulted in an array of estimated long-term uncertainty impacts. Consequently, many businesses and firms closed, and employees were dismissed.
Added
On July 24, 2023, the Offering closed, and the Company issued and sold 1,437,500 shares of common stock, including 187,500 shares sold pursuant to the exercise of the Over-Allotment Option. The Offering was priced at $4.00 per share for total gross proceeds of $5.75 million before deducting underwriting discounts, commissions, and offering expenses.
Removed
Towards a new recovery phase in 2022, most businesses and organizational functions were prioritizing our spending or postpone any tasks and events that do not bring any value to the current situation because even when the challenges are successfully addressed, this will not guarantee any promising future. Cost of revenues .
Added
Pursuant to the Underwriting Agreement, the Underwriter received an 8% underwriting discount on the public offering price for the shares common stock. The Company therefore received net proceeds, before expenses, of $5,290,000 from the sale of the common stock.
Removed
For the year ended December 31, 2022, we had operating expenses of $1,729,489 as compared to operating expenses of $1,277,605 for the year ended December 31, 2021, an increase of 35.4% for the current year was due to depreciation on new equipment purchased, equipment maintenance expenses, employee compensation and benefits, professional and directors’ fees, marketing, travel expenses and adjustment of unrealized loss on foreign exchange for subsidiaries BGL and Chemrex.
Added
In addition, the Company issued to the Underwriter warrants to purchase up to an aggregate of 115,000 shares of the Company's common stock (the "Underwriter's Warrants") at an exercise price of $4.40 per share. The Underwriter's Warrants are exercisable from July 24, 2023 until July 24, 2028.
Removed
Some competitors were clearing their stock to improve their cash flow position after 1 ½ years of movement controls imposed by the government. BioNexus had a revenue of $95,816 (0.9%) for the year ended December 31, 2022 as compared to revenues of $1,515,673 (11.34%) from the same period ended December 31, 2021, a decrease of 93.7%.
Added
Reverse stock split On June 5, 2023, the Company filed an Article of Amendment to the Articles of Incorporation with the Wyoming Secretary of State to modify the ratio of the Reverse Stock Split from one-for-ten (10) to one-for-twelve (12) (the “Revised Reverse Stock Split”).
Removed
The revenue decreased in 2022 was due to the outsource contract for Covid19 PCR test from Ministry of Health (HHS) had ended in December 2021. 44 Table of Contents Cost of revenues .
Added
Upon effectiveness of the Revised Reverse Stock Split, every twelve (12) outstanding shares of common stock were combined into and automatically became one share of common stock.
Removed
The increase of 6.29% in Chemrex operating expenses for the 2022 due to increase in director's remuneration and loss on fair value of equity investment.
Added
No fractional shares were issued in connection with the Revised Reverse Stock Split and all such fractional shares or odd lots (less than 100 shares to any record or beneficial holder) that were issuable in the Revised Reverse Stock Split were rounded up to the nearest whole share, or rounded up to 100 shares, respectively.
Removed
The increase of $126,659 in operating costs was due to increase in marketing expenses, hiring and training new lab staffs, writing off investment in Genenews Diagnostic (company has been closed) and expired covid19 test kits.
Added
The Revised Reverse Stock Split was approved and authorized by a majority of the Company’s stockholder on May 8, 2023 and by the Board of Directors of the Company on May 8, 2023.
Removed
In addition, expenses incurred in heart attack research/clinical test and also year-end adjustment for unrealized loss on foreign exchange of $52,129 due to weakening of Malaysia ringgit against US dollar. Profit /(loss) before tax.
Added
On July 19, 2023, the Financial Industry Regulatory Authority announced the Revised Reverse Stock Split. 32 Table of Contents Result of Operations Exchange Rates Translation of amounts from RM (MYR) into US$1.00 has been made at the following exchange rates for the respective years: December 31, December 31, 2023 2022 Year-end US$1.00: MYR exchange rate 4.5900 4.3900 January 1, January 1, 2023 to 2022 to December 31, December 31, 2023 2022 Yearly average US$1.00: MYR exchange rate 4.5658 4.3996 Results of Operations for the Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 (Audited).
Removed
By comparison, during the year ended December 31, 2021, we had net cash used in financing activities of $28,222 for continued the repayment of a finance lease $26,302 and repayment of director $1,920. Item 7A. Quantitative and Qualitative Disclosures About Market Risk. Not applicable to smaller reporting companies.
Added
For the year ended December 31, 2023, we had revenues of $9,770,806 as compared to revenues of $10,928,707 for the year ended December 31, 2022, a decrease of approximately 10.6%. The decrease is due primarily to a reduction in sales at our Chemrex subsidiary discussed further below. Cost of revenues .
Added
The increase of 154.9% for the current year was due to the costs associated with our uplisting from OTC markets to Nasdaq, the subsequent increases in compliance costs, and business development costs. Additionally, new accounting standards were applied which saw a corresponding write down in accounts receivable within Our subsidiary, Chemrex.
Added
The revenue decreased in 2023 was due to competition in the market and reduced selling price for resin and fiberglass mats in Malaysia. MRNA Scientific had a revenue of $24,219 (0.2%) for the year ended December 31, 2023, as compared to revenues of $95,816 (0.9%) from the same period ended December 31, 2022, a decrease of 75%.
Added
The revenue decreased in 2023 was due to RNA screening process having been adversely impacted by the Covid-19 pandemic. We believe that most people in Malaysia were reluctant to visit hospitals and clinics in view of the post Covid-19 Omicron and its subvariants for fear of transmission from other patients or medical staff.
Added
Since our RNA screening is administered at diagnostic centers, our business was adversely affected as a result. Cost of revenues .
Added
The increase of 91.9% in Chemrex operating expenses for the 2023 due to the increased commission, directors’ remuneration, medical expenses, loss on unrealized/realized currency exchange, withholding taxes and provision for losses on account receivables of $1,314,427.
Added
The decrease of $41,006 in operating costs was due efficiencies in research and development, as well efficiencies in personnel allocation.
Added
At the parent level, we incurred $2,144,374 (44.9%) of the total combined operating expenses for the year ended December 31, 2023, as compared to the operating expenses of $390,881 (14.3%) of the total combined operating expenses for the year ended December 31, 2022.
Added
The increase of $1,753,493 approximately 448.6% in operating costs due cost and expenses associated with our public offering and the up listing to the NASDAQ market, including underwriting cost of $660,000, share-based compensation of $511,740, listing expenses of $205,224 and increased legal and audit fees, among others. (Loss)/Profit before tax.
Added
MRNA Scientific incurred a loss of $226,802 for the year ended December 31, 2023, compared a loss of $239,229 for the year ended December 31, 2022 a decrease of 5.2%, for the reasons discussed above. Income tax expense .
Added
Financing Activities During the year ended December 31, 2023, Company had net cash of $5,754,322 generated from financing activities for shares subscriptions of initial public offering (IPO) of 1,473,500 shares at a price to the public of $4.00 per share for total proceeds of $5,750,000 and advances from directors of $13,199.

Other BGLC 10-K year-over-year comparisons