Questions to be raised to the Board of Directors of Bioalpha Holdings Berhad (“Bioalpha”) for the forthcoming Ninth (9^th) AGM on 10 am, 17 August 2020 at Bioalpha Bangi Office:-

1. Aggressive fund-raising activities - From FY15 to 19, the Company has raised a whopping RM66.59 mil via combination of private placements, rights issue and ESOS, with year-to-date for FY20 approximately RM19 mil from the recent ESOS and private placement exercises at RM0.105. In total, RM85.59 million has been raised to partially finance the capital expenditures of the Company in relation to the development expenditures for two (2) botanicals drugs; hormone replacement therapy  and Type 2 diabetes (in total RM53 mil) and properties, plants and equipment (RM47 million). As a result, it has created a huge dilution in shareholders’ equity interests, with the two-fold increase of issued shares from 463,413,114 (as at 22/4/15) to 1,041,168,732 shares (as at 19/7/20).

Furthermore, in 2016, RM28 million was allocated for the development of these drugs with the expected commercialisation by end of 2019. However, as at end FY19, the costs had escalated to RM53 million but still awaiting for approval of MOH on the clinical trials. The Company continued to burn huge money on this activity. 

Kindly explain how the Company plans to reduce these aggressive expansions and when can the drugs be ready for commercialisation?

2. Collections issue - The Company’s trade receivables are just piling up every year, with RM44.6 million (70% of the revenue) for FY19. It needs to a plan to reduce this and to ease its cash flow issue;
3. The Company continued to be dampened with high operating costs for many years. What are Company plans to reduce its costs further in the midst of deteriorating businesses outlook? A 15% of reduction to directors and senior management costs might not help at all. Much more management and staff costs need to be reduced.  It needs to urgently relook on its business model, cost structure, expansion plans, and expensive distribution channels to stay alive and be competitive; and
4. Is the Company plans to expand solutions and offerings focusing on new norm, with minimal increment in costs. Currently, despite much costs been spent on capital expenditures (i.e. mindblowing RM100 mil since FY15) but excluding the contribution from its retails pharmacy business of around RM20 to 27 million a year, its trading and manufacturing business across all countries is not growing