S-1/A: Advanced Biomed Inc. Eyes Nasdaq Listing with $7.5 Million Common Stock Offering

Advanced Biomed Inc. is seeking to raise capital through an initial public offering of 1,875,000 shares of common stock, aiming for a Nasdaq listing to further its cancer detection technology.

Summary

• Advanced Biomed Inc., a Nevada-based holding company, is planning an initial public offering to sell 1,875,000 shares of its common stock.
• The company expects the offering price to be between $4.00 and $6.00 per share, potentially raising gross proceeds of $7.5 million to $11.25 million.
• Advanced Biomed operates primarily through its Taiwan subsidiary, focusing on developing microfluidic technology for early cancer detection.
• The company has applied to list its common stock on the Nasdaq Capital Market under the symbol ADVB, but completion of the offering is contingent upon successful listing.
• Advanced Biomed has a Shanghai subsidiary that owns R&D equipment and will handle clinical trials in Mainland China.
• The company intends to use the net proceeds from the offering for clinical research, chip design and development, facility upgrades, market expansion, marketing and sales, and general working capital.
• Advanced Biomed faces risks associated with operating in China, including regulatory uncertainties and potential government intervention.
• The company also registers 1,875,000 Common Stock for the resale of our Common Stock owned by the Selling Stockholders.
• The offering is being conducted on a firm commitment basis, with Craft Capital Management LLC acting as the underwriter.
• The underwriters have a 45-day option to purchase up to 281,250 additional shares to cover over-allotments.

Sentiment

Score: 5

Explanation: The document presents a balanced view, highlighting both the potential of the company's technology and the risks associated with its business and the regulatory environment. The lack of current revenue and reliance on future events temper the positive aspects.

Positives

• The company has developed a microfluidic technology platform for cancer detection.
• A+Pre and AC-1000 and their corresponding chips have been cleared by the NMPA.
• The company has a multi-disciplinary management team with experience in semiconductor and biomedical fields.
• The company has a research project equipment use contract with Taiwan Semiconductor Research Institute of National Applied Research Laboratories (TSRI).
• The company has been cooperating with the injection molding machine manufacturer Riva and the mold manufacturer Unimold to conduct pre-mass production trial test for our A+Pre Chip and AC-1000 Enrichment Chip.

Negatives

• Advanced Biomed Inc. is a holding company with substantially all business operations conducted in Taiwan.
• The company has not generated positive cash income and any failure to raise additional capital will significantly hinder our ability to continue our operations and developing new products.
• The company expects to be in a state of continuous loss for the next two to three years.
• The company has not conducted any clinical trials for our products.
• The company has relatively limited experience in product promotion and sales.
• The company has only a limited accounting personnel and have corrected an error in application of the accounting principle for business combinations accounted for an acquisition of an entity during the year ended June 30, 2022.

Risks

• The company faces regulatory risks associated with operating in China, including potential government intervention and changes in regulations.
• The company's ability to transfer cash between its subsidiaries may be restricted by PRC regulations.
• The company may be unable to develop or commercialize early cancer detection products and compete with its competitors.
• The company may be subject to intellectual property infringement claims by third parties.
• The company may face difficulties enforcing liabilities against its directors and officers in China.
• The company may experience extreme stock price volatility.
• The company may be unable to obtain regulatory approvals for its products in North America or Europe.
• The company may be subject to litigation and other claims and legal proceedings, and may not always be successful in defending ourselves against these claims or proceedings.

Future Outlook

The company expects to be in a state of continuous loss for the next two to three years.

Management Comments

• We are committed to the application research of integrating semiconductor technology and biotechnology.
• Through the enrichment, capture, and identification of circulating tumor cells and related tumor marker cells in the field of liquid biopsy, we aim to provide cancer patients with rapid and affordable assay products and services.
• We follow the principle of modularization when design and develop all of our products and equipment so that products and equipment can be produced locally to meet different regulatory requirements.
• We have adopted the operation model of centralized research and development and localized management.

Industry Context

The global liquid biopsy market is projected to grow significantly, with early tumor screening and diagnosis being the most active areas. According to Grand View Research, the global liquid biopsy market size was valued at USD8,937.68 million in 2022 and is anticipated to grow at a CAGR of 12.46% from 2023 to 2030, resulting in sales worth USD22,865.56 million in 2030.

Comparison to Industry Standards

• The current market uses positive antibody-labeling selection to capture CTCs out of the blood by a specific epithelial cell adhesion molecule (EpCAM), costing approximately $1,000 per chip and taking up to 12 hours per patient.
• Universal Diagnostics (UDX) detected lung cancer patients with a sensitivity of 73% and 90% specificity using a liquid biopsy method.
• The Aifeiming gene methylation detection kit has a clinical sensitivity of 86.83%.
• Advanced Biomed's products aim to offer a more cost-effective and efficient solution, using pure physical mechanisms and achieving high viability in CTC enrichment and detection.

Related Party Transactions

• Advanced Biomed Inc.(HK) entered into one unsecured, interest-free loan to Hung To Pau, Ph.D. amounting to US$200,000 for general working capital in July 2024.
• Advanced Biomed Inc.(Taiwan) entered into an unsecured, interest-free loan to Yi Lu amounting to NTD 3,578,212 (approximately US$110,268) for general working capital in January 2023.
• Advanced Biomed Inc.(Taiwan) entered into ten unsecured, interest-free loans to Well Fancy Development Ltd amounting to NTD 2,967,700 (approximately US$91,455), NTD2,989,873 (approximately US$92,138), NTD4,270,200 (approximately US$131,593), NTD1,945,000 (approximately US$59,938), NTD1,858,120 (approximately US$57,261), NTD2,912,200 (approximately US$89,744), NTD2,890,065 (approximately US$89,062), NTD5,857,750 (approximately US$180,516), NTD4,356,145 (approximately US$134,242) and NTD3,732,100 (approximately US$115,011) for general working capital in August 2022, April 2023, May 2023, June 2023, July 2023, August 2023, October 2023, December 2023, February 2024 and April 2024, respectively.
• Shanghai Sglcell Biotech Co., Ltd entered into four unsecured, interest-free loans to Shanghai Junfu Electronic Technology Co., Ltd. amounting to RMB500,000 (approximately US$71,249) in April 2023, May 2023, June 2023 and September 2023, respectively, and RMB700,000 (approximately US$99,749), RMB1,500,000 (approximately US$213,748) and RMB700,000 (approximately US$99,749) in January 2024, March 2024 and June 2024, respectively, for general working capital.
• As of June 30, 2024, the amount due to Hung To Pau, Ph.D. of US$1,233,764 has been waived off by Hung To Pau, Ph.D.
• As of June 30, 2024, the total amount due to Well Fancy Development Ltd of US$1,586,860 has been waived off by Well Fancy Development Ltd.

Stakeholder Impact

• Shareholders face potential dilution from the offering and future equity issuances.
• Employees may benefit from the company's growth and expansion plans.
• Customers (cancer patients) could gain access to more affordable and rapid cancer detection services.
• Suppliers may see increased demand for their products as the company expands its operations.
• Creditors face risks related to the company's ability to service its debts.

Next Steps

• Complete the Nasdaq listing process.
• Conduct clinical research for A+LCGuard, starting by the end of June 2025.
• Submit registration applications for A+CellScan, A+CellScan Chip, and A+SCDrop.
• Continue localized registration of IVD products in Europe in 2025.
• Establish subsidiaries in the United States and Europe to produce products and carry out product registration.

Key Dates

Keywords

cancer detection, microfluidic technology, initial public offering, biomedical, diagnostics, biotech, IPO, ADVB, Taiwan, China