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Related Parties Transactions
 9 Months Ended 12 Months Ended
Sep. 30, 2023
Dec. 31, 2022
Related Parties Transactions [Abstract]    
RELATED PARTIES TRANSACTIONS

8. RELATED PARTIES TRANSACTIONS 

 

The related parties of the company with whom transactions are reported in these financial statements are as follows:

 

Name of entity or Individual   Relationship with the Company and its subsidiaries
BioFirst Corporation (the “BioFirst”)   Entity controlled by controlling beneficiary shareholder of YuanGene
BioFirst (Australia) Pty Ltd. (the “BioFirst (Australia)”)   100% owned by BioFirst; Entity controlled by controlling beneficiary shareholder of YuanGene
Rgene Corporation (the “Rgene”)   Shareholder of the Company; Entity controlled by controlling beneficiary shareholder of YuanGene; the Chairman of Rgene is Mr. Tsung-Shann Jiang
YuanGene Corporation (the “YuanGene”)   Controlling beneficiary shareholder of the Company
AsiaGene Corporation (the “AsiaGene”)   Shareholder; entity controlled by controlling beneficiary shareholder of YuanGene
Eugene Jiang   Former President and Chairman
Keypoint Technology Ltd. (the “Keypoint’)   The Chairman of Keypoint is Eugene Jiang’s mother.
Lion Arts Promotion Inc. (the “Lion Arts”)   Shareholder of the Company
Yoshinobu Odaira (the “Odaira”)   Director of the Company
GenePharm Inc. (the “GenePharm”)   Dr. George Lee, Board Director of BioKey, is the Chairman of GenePharm.
Euro-Asia Investment & Finance Corp Ltd. (the “Euro-Asia”)   Shareholder of the Company
LBG USA, Inc. (the “LBG USA”)   100% owned by BioFirst; Entity controlled by controlling beneficiary shareholder of YuanGene
LionGene Corporation (the “LionGene”)   Shareholder of the Company; Entity controlled by controlling beneficiary shareholder of YuanGene
Kimho Consultants Co., Ltd. (the “Kimho”)   Shareholder of the Company
The Jiangs   Mr. Tsung-Shann Jiang, the controlling beneficiary shareholder of the Company; the Chairman of Rgene; the Chairman and CEO of the BioLite Holding Inc. and BioLite Inc. and the President and a member of board of directors of BioFirst

Ms. Shu-Ling Jiang, Mr. Tsung-Shann Jiang’s wife, is the Chairman of Keypoint; and a member of board of directors of BioLite Inc.

Mr. Eugene Jiang is Mr. and Ms. Jiang’s son. Mr. Eugene Jiang is the chairman, and majority shareholder of the Company and a member of board of directors of BioLite Inc.

Mr. Chang-Jen Jiang is Mr. Tsung-Shann Jiang’s sibling and the director of the Company.

Ms. Mei-Ling Jiang is Ms. Shu-Ling Jiang’s sibling.
Amkey Ventures, LLC (“Amkey”)   An entity controlled by Dr. George Lee, who serves as one of the board directors of BioKey, Inc
BioLite Japan   Entity controlled by controlling beneficiary shareholder of ABVC
BioHopeKing Corporation   Entity controlled by controlling beneficiary shareholder of ABVC
ABVC BioPharma (HK), Limited   An entity 100% owned by Mr. Tsung-Shann Jiang

 

Accounts receivable - related parties

 

Accounts receivable due from related parties consisted of the following as of the periods indicated:

 

   September 30,   December 31, 
   2023   2022 
   (Unaudited)     
GenePharm Inc.  $
-
   $142,225 
Rgene   624,373    615,118 
Total  $624,373   $757,343 

 

Revenue - related parties

 

Revenue due from related parties consisted of the following as of the periods indicated:

 

   September 30,   September 30, 
   2023   2022 
   (Unaudited)   (Unaudited) 
Rgene  $1,900   $307,788 
Total  $1,900   $307,788 

 

Due from related parties

 

Amount due from related parties consisted of the following as of the periods indicated:

 

Due from related–party - Current

 

   September 30,   December 31, 
   2023   2022 
   (Unaudited)     
Rgene  $535,046   $513,819 
Total  $535,046   $513,819 

 

Due from related parties – Non-Current

 

   September 30,   December 31, 
   2023   2022 
   (Unaudited)     
BioFirst (Australia)  $822,781   $752,655 
BioHopeKing Corporation   107,615    112,822 
Total  $930,396   $865,477 

 

(1)On June 16, 2022, the Company entered into a one-year convertible loan with Rgene, with a principal amount of $1,000,000 to Rgene which bears interest at 5% per annum for the use of working capital that, if fully converted, would result in ABVC owning an additional 6.4% of Rgene. The Company may convert the Note at any time into shares of Rgene’s common stock at either (i) a fixed conversion price equal to $1.00 per share or (ii) 20% discount of the stock price of the then most recent offering, whichever is lower; the conversion price is subject to adjustment as set forth in the Note. The Note includes standard events of default, as well as a cross default provision pursuant to which a breach of the Service Agreement will trigger an event of default under the convertible note if not cured after 5 business days of written notice regarding the breach is provided.

 

As of September 30, 2023 and December 31, 2022, the outstanding loan balance were both $500,000; and accrued interest was $32,518 as of September 30, 2023; while the accrued interest as of December 31, 2022 was $13,819.

 

As of September 30, 2023 and December 31, 2022, the Company has other receivables of $2,528 and $0, respectively.

 

(2)On July 1, 2020, the Company entered into a loan agreement with BioFirst (Australia) for $361,487 to properly record R&D cost and tax refund allocation based on co-development contract executed on July 24, 2017. The loan was originally set to be mature on September 30, 2021 with an interest rate of 6.5% per annum, but on September 7, 2021, the Company entered into a loan agreement with BioFirst (Australia) for $67,873 to meet its new project needs. On July 27, 2021, the Company repaid a loan 249,975 to BioFirst (Australia). On December 1, 2021, the Company entered into a loan agreement with BioFirst (Australia) for $250,000 to increase the cost for upcoming projects. The loan will be matured on November 30, 2022 with an interest rate of 6.5% per annum. In 2022, the Company entered into several loan agreements with BioFirst (Australia) for a total amount of $507,000 to increase the cost for upcoming projects. During the first quarter of 2023, the Company entered into several loan agreements with BioFirst (Australia) for a total amount of $88,091 to increase the cost for upcoming projects. During the second quarter of 2023, the Company entered into several loan agreements with BioFirst (Australia) for a total amount of $25,500 to increase the cost for upcoming projects. All the loans period was twelve months with an interest rate of 6.5% per annum. For accounting purpose, the due from and due to related party balances was being net off. As of September 30, 2023 and December 31, 2022, the outstanding loan balance and allocated research fee was $681,185 and $660,484, respectively; and accrued interest was $141,596 and $92,171, respectively. The Company is expected to receive the outstanding amount in full by 2023 Q4.

 

(3)On February 24, 2015, BioLite Taiwan and BioHopeKing Corporation (the “BHK”) entered into a co-development agreement, (the “BHK Co-Development Agreement”, see Note 3). The development costs shall be shared 50/50 between BHK and the Company. Under the term of the agreement, BioLite issued relevant development cost to BHK. As of September 30, 2023 and December 31, 2022, due from BHK was $107,615 and $112,822, respectively. The Company made an impairment to write off the amount due from BHK.

 

Due to related parties

 

Amount due to related parties consisted of the following as of the periods indicated:

 

   September 30,   December 31, 
   2023   2022 
   (Unaudited)     
BioFirst Corporation  $315,947   $188,753 
The Jiangs   19,789    19,789 
Due to shareholders   144,460    151,450 
Total  $480,196   $359,992 

 

(1)Since 2019, BioFirst has advanced funds to the Company for working capital purpose. The advances bear interest 1% per month (or equivalent to 12% per annum). As of September 30, 2023 and December 31, 2022, the aggregate amount of outstanding balance and accrued interest is $315,947 and $188,753, respectively. Interest expenses in connection with these loans were$9,327 and $0 for the three months ended September 30, 2023 and 2022, respectively.   Interest expenses in connection with these loans were $24,400 and $0 for the nine months ended September 30, 2023 and 2022, respectively.

 

(2)Since 2019, the Jiangs advanced funds to the Company for working capital purpose. As of September 30, 2023, and December 31, 2022, the outstanding balance due to the Jiangs amounted to $19,789 and $19,789, respectively. These loans bear interest rate of 0% to 1% per month, and are due on demand.

 

Interest expenses in connection with these advanced funds were$499 and $0 for the nine months ended September 30, 2023 and 2022, respectively.

 

(3)Since 2018, the Company’s shareholders have advanced funds to the Company for working capital purpose. The advances bear interest rate of 12% per annum. As of September 30, 2023 and December 31, 2022, the outstanding principal and accrued interest was $144,460 and $151,450, respectively. Interest expenses in connection with these loans were $5,015 and $5,208 for the three months ended September 30, 2023 and 2022, respectively. Interest expenses in connection with these loans were $15,082 and $15,922 for the nine months ended September 30, 2023 and 2022, respectively.

12. RELATED PARTIES TRANSACTIONS 

 

The related parties of the company with whom transactions are reported in these financial statements are as follows:

 

Name of entity or Individual   Relationship with the Company and its subsidiaries
BioFirst Corporation (the “BioFirst”)   Entity controlled by controlling beneficiary shareholder of YuanGene
BioFirst (Australia) Pty Ltd. (the “BioFirst (Australia)”)   100% owned by BioFirst; Entity controlled by controlling beneficiary shareholder of YuanGene
Rgene Corporation (the “Rgene”)   Shareholder of the Company; entity controlled by controlling beneficiary shareholder of YuanGene
YuanGene Corporation (the “YuanGene”)   Controlling beneficiary shareholder of the Company
AsiaGene Corporation (the “AsiaGene”)   Shareholder; entity controlled by controlling beneficiary shareholder of YuanGene
Eugene Jiang   Former President and Chairman
Keypoint Technology Ltd. (the “Keypoint’)   The Chairman of Keypoint is Eugene Jiang’s mother.
Lion Arts Promotion Inc. (the “Lion Arts”)   Shareholder of the Company
Yoshinobu Odaira (the “Odaira”)   Director of the Company
GenePharm Inc. (the “GenePharm”)   Dr. George Lee, Board Director of Biokey, is the Chairman of GenePharm.
Euro-Asia Investment & Finance Corp Ltd. (the “Euro-Asia”)   Shareholder of the Company
LBG USA, Inc. (the “LBG USA”)   100% owned by BioFirst; Entity controlled by controlling beneficiary shareholder of YuanGene
LionGene Corporation (the “LionGene”)   Shareholder of the Company; Entity controlled by controlling beneficiary shareholder of YuanGene
Kimho Consultants Co., Ltd. (the “Kimho”)   Shareholder of the Company

The Jiangs

  

Mr. Tsung-Shann Jiang, the controlling beneficiary shareholder of the Company and Rgene, the Chairman and CEO of the BioLite Holding Inc. and BioLite Inc. and the President and a member of board of directors of BioFirst

 

Ms. Shu-Ling Jiang, Mr. Tsung-Shann Jiang’s wife, is the Chairman of Keypoint; and a member of board of directors of BioLite Inc.

 

Mr. Eugene Jiang is Mr. and Ms. Jiang’s son. Mr. Eugene Jiang is the chairman, and majority shareholder of the Company and a member of board of directors of BioLite Inc.

 

Mr. Chang-Jen Jiang is Mr. Tsung-Shann Jiang’s sibling and the director of the Company.

 

Ms. Mei-Ling Jiang is Ms. Shu-Ling Jiang’s sibling.

Amkey Ventures, LLC (“Amkey”)   An entity controlled by Dr. George Lee, who serves as one of the board directors of BioKey, Inc
BioLite Japan   Entity controlled by controlling beneficiary shareholder of ABVC
BioHopeKing Corporation   Entity controlled by controlling beneficiary shareholder of ABVC
ABVC BioPharma (HK), Limited   An entity 100% owned by Mr. Tsung-Shann Jiang

 

Accounts receivable - related parties

 

Accounts receivable due from related parties consisted of the following as of the periods indicated:

 

   December 31,   December 31, 
   2022   2021 
GenePharm Inc.  $142,225   $142,225 
Rgene   615,118    2,374 
Amkey   
-
    800 
Total  $757,343   $145,399 

 

Due from related parties

 

Amount due from related parties consisted of the following as of the periods indicated:

 

Due from related party- Current

 

   December 31,   December 31, 
   2022   2021 
Rgene  $513,819   $
                  -
 
Total  $513,819   $
-
 

 

Due from related parties- Noncurrent

 

   December 31,   December 31, 
   2022   2021 
Rgene  $-   $49,110 
BioFirst (Australia)   1,028,556    491,816 
BioHopeKing Corporation   112,822    124,972 
LBG USA   
-
    675 
BioLite Japan   
-
    150,000 
Keypoint   
-
    1,610 
Total  $1,141,378   $818,183 

 

(1)

As of December 31, 2021, due from Rgene amounted to $49,110. Under the terms of the loan agreement, the loan bears interest at 1% per month (or equivalent to 12% per annum) and the maturity date was December 31, 2020. As of December 31, 2021, the outstanding loan balance was $33,520; and accrued interest was $13,701, respectively. On January 1, 2021, BioLite Taiwan entered into a consultant services agreement with Rgene, of which the amount due from Rgene was $1,889 for the year ended December 31, 2021.

 

On June 16, 2022, the Company entered into a one-year convertible loan agreement with Rgene, with a principal amount of $1,000,000 to Rgene which bears interest at 5% per annum for the use of working capital that, if fully converted, would result in ABVC owning an additional 6.4% of Rgene. The Company may convert the Note at any time into shares of Rgene’s common stock at either (i) a fixed conversion price equal to $1.00 per share or (ii) 20% discount of the stock price of the then most recent offering, whichever is lower; the conversion price is subject to adjustment as set forth in the Note. The Note includes standard events of default, as well as a cross-default provision pursuant to which a breach of the Service Agreement will trigger an event of default under the convertible note if not cured after 5 business days of written notice regarding the breach is provided. As of December 31, 2022, the outstanding loan balance was $ 500,000; and accrued interest was $13,819.

 

(2) On July 1, 2020, the Company entered into a loan agreement with BioFirst (Australia) for $361,487 to properly record R&D cost and tax refund allocation based on co-development contract executed on July 24, 2017. The loan was originally set to be mature on September 30, 2021 with an interest rate of 6.5% per annum, but on September 7, 2021, the Company entered into a loan agreement with BioFirst (Australia) for $67,873 to meet its new project needs.   On December 1, 2021, the Company entered into a loan agreement with BioFirst (Australia) for $250,000 to increase the cost for upcoming projects. The loan will be matured on November 30, 2022 with an interest rate of 6.5% per annum. In 2022, the Company entered into several loan agreements with BioFirst (Australia) for a total amount of $507,000 to increase the cost for upcoming projects. All the loans period was twelve months with an interest rate of 6.5% per annum. As of December 31, 2022 and 2021, the aggregate amount of outstanding loan and accrued interest was $1,028,556 and $491,816, respectively.

 

(3)

 On February 24, 2015, BioLite Taiwan and BioHopeKing Corporation (the “BHK”) entered into a co-development agreement, (the “BHK Co-Development Agreement”, see Note 3). The development costs shall be shared 50/50 between BHK and the Company. Under the term of the agreement, BioLite issued relevant development cost to BHK. As of December 31, 2022 and 2021, due from BHK was $112,822 and $124,972, respectively.

 

(4) On May 8, 2020, the Company and Lucidaim entered into a Letter of Intent (LOI) in regard to a potential joint venture of BioLite Japan. Based on the LOI, each party will advance an aggregated amount of $150,000 to meet BioLite Japan’s working capital needs, which the Company advanced an amount of $150,000 and the advance bear 0% interest rate. As of December 31, 2022 and 2021, the outstanding advance balances was $0 and $150,000, respectively. The outstanding balance was reclassified as prepayment for long-term investments due to the debt-to-equity agreement with BioLite Japan, while format document is pending to be executed.

 

Due to related parties

 

Amount due to related parties consisted of the following as of the periods indicated:

 

   December 31,   December 31, 
   2022   2021 
BioFirst Corporation  $188,753   $40,878 
BioFirst (Australia)   275,901    132,443 
AsiaGene   
-
    24,017 
YuanGene   
-
    9,205 
The Jiangs   19,789    18,750 
Due to shareholders   151,450    168,131 
Total  $635,893   $393,424 

 

(1) Since 2019, BioFirst has advanced funds to the Company for working capital purpose. The advances bear interest 1% per month (or equivalent to 12% per annum). As of December 31, 2022 and 2021, the aggregate amount of outstanding balance and accrued interest is $188,753, a combination of $147,875 from loan, and $40,878 from expense-sharing, and $40,878, respectively.

 

(2) As of December 31, 2022 and 2021, BioFirst (Australia) has advanced the Company an aggregate amount of $275,901 and $132,443, respectively for new project purpose.

 

(3) Since 2019, the Jiangs advanced funds to the Company for working capital purpose. As of December 31, 2022 and 2021, the outstanding balance due to the Jiangs amounted to $19,789 and $18,750, respectively. These loans bear interest rate of 0% to 1% per month, and are due on demand.

 

(4) Since 2018, the Company’s shareholders have advanced funds to the Company for working capital purpose. The advances bear interest rate from 12% to 13.6224% per annum. As of December 31, 2022 and 2021, the outstanding principal and accrued interest was $151,450 and $168,131, respectively. Interest expenses in connection with these loans were $21,378 and $22,779 for the years ended December 31, 2022 and 2021, respectively.

 

Revenue from related party

 

  

Year Ended
December 31,

 
   2022   2021 
Rgene  $904,043   $2,373  
Total  $904,043   $2,373