TuHURA Biosciences, Inc 10-Q, filed Feb 14, 2023
TuHURA Biosciences, Inc. (HURA)
About this 10-Q
TuHURA Biosciences, Inc filed this 10-Q on February 14, 2023, covering the quarter ended December 31, 2022.
Headline figures
Quarter ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- $3.45M
- compared with a net loss of $5.89M a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
For the quarterly period ended
or
For the transition period from to
Commission file number:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of |
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(I.R.S. Employer |
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(Address of principal executive offices) |
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(zip code) |
(
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
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Trading Symbol(s) |
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Name of Each Exchange on Which Registered |
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The |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No
Number of shares of common stock outstanding as of February 13, 2023 was
TABLE OF CONTENTS
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Page No. |
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Item 1. |
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1 |
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Item 2. |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
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Item 3. |
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31 |
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Item 4 |
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31 |
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Item 1. |
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32 |
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Item 1A. |
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Item 2. |
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Unregistered Sales of Equity Securities and Use of Proceeds. |
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Item 3. |
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32 |
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Item 4. |
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32 |
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Item 5. |
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32 |
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Item 6. |
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33 |
i
PART 1. - FINANCIAL INFORMATION
Item 1. Financial Statements.
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Financial Statements
(Unaudited)
For the six months ended December 31, 2022
(expressed in US dollars unless otherwise noted)
1
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Balance Sheets
(In thousands, except par value amounts)
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December 31, |
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June 30, |
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Note |
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$ |
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$ |
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(unaudited) |
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Assets |
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Current assets |
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Cash and cash equivalents |
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Prepaid expenses, deposits and other |
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Clinical trial deposit |
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3 |
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— |
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Total current assets |
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Clinical trial deposit |
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3 |
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— |
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Property and equipment, net |
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4 |
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Total assets |
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Liabilities |
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Current liabilities |
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Accounts payable and accrued liabilities |
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Related party payables |
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5,6 |
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Total current liabilities |
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Milestone payment liability |
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8 |
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Total liabilities |
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Stockholders' equity |
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Preferred stock |
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Authorized |
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Issued and outstanding |
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5,6 |
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6 |
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Common stock |
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Authorized |
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Issued and outstanding |
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6 |
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Additional paid-in capital |
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6 |
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Accumulated deficit |
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Accumulated other comprehensive income |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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Nature of operations, corporate history, going concern and management plans (note 1) |
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Subsequent events (note 9) |
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The accompanying notes are an integral part of these condensed consolidated interim financial statements.
2
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
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Three months ended |
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Six months ended |
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Note |
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2022 |
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2021 |
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2022 |
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2021 |
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Expenses |
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Research and development |
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$ |
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$ |
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General and administrative |
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Other income |
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Foreign exchange |
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— |
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Interest, net |
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Net loss for the period |
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( |
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Computation of basic loss per share |
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Net loss for the period |
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( |
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Series A Preferred cash dividend |
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6 |
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( |
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( |
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( |
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( |
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Series C Preferred stock dividend |
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6 |
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— |
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— |
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( |
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Net loss for the period attributable to common stockholders |
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$ |
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$ |
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Basic and fully diluted loss per share |
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( |
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$ |
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$ |
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Basic and fully diluted weighted average number of shares |
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The accompanying notes are an integral part of these condensed consolidated interim financial statements.
3
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Statements of Stockholders’ Equity
(Unaudited)
For the six months ended December 31, 2022
(In thousands)
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Number |
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Common |
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Additional |
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Accumulated |
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Preferred |
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Accumulated |
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Total stockholders' |
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Balance - June 30, 2022 |
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Issuance of shares - net of issue costs |
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— |
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— |
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— |
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Stock option expense |
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— |
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— |
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— |
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— |
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— |
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Series A Preferred cash dividend |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Series C Preferred stock dividend |
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— |
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— |
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— |
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( |
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— |
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Loss for the period |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Balance - September 30, 2022 |
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( |
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Conversion of Series C Preferred stock to common stock |
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— |
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— |
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( |
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— |
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— |
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Additional shares issued on reverse stock split |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock option expense |
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— |
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— |
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— |
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— |
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— |
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Series A Preferred cash dividend |
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— |
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— |
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— |
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— |
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— |
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( |
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Loss for the period |
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— |
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— |
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— |
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— |
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— |
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( |
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Balance - December 31, 2022 |
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The accompanying notes are an integral part of these condensed consolidated interim financial statements.
4
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Statements of Stockholders’ Equity
(Unaudited)
For the six months ended December 31, 2021
(In thousands)
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Number |
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Common |
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Additional |
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Accumulated |
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Preferred |
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Accumulated |
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Total stockholders' |
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Balance - June 30, 2021 |
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( |
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Issuance of shares and warrants - net of issue costs |
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— |
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— |
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— |
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— |
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Conversion of Series C Preferred stock to common stock |
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— |
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— |
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( |
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— |
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— |
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Exercise of 2020 Investor Warrants for cash |
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— |
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— |
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— |
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— |
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Exercise of pre-funded warrants for cash |
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— |
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— |
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— |
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— |
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Warrants issued for services |
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— |
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— |
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— |
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— |
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— |
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Stock option expense |
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— |
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— |
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— |
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— |
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— |
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Series A Preferred cash dividend |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Series C Preferred stock dividend |
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— |
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— |
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— |
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( |
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— |
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Loss for the period |
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— |
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— |
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— |
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— |
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— |
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( |
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Balance - September 30, 2021 |
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Conversion of Series C Preferred stock to common stock |
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— |
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— |
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( |
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— |
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— |
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Warrants issued for services |
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— |
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— |
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— |
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— |
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— |
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Stock option expense |
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— |
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— |
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— |
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— |
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— |
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Series A Preferred cash dividend |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Loss for the period |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Balance - December 31, 2021 |
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The accompanying notes are an integral part of these condensed consolidated interim financial statements.
5
Kintara Therapeutics, Inc.
Condensed Consolidated Interim Statements of Cash Flows
(Unaudited)
(In thousands)
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Six months ended |
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2022 |
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2021 |
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Note |
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$ |
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$ |
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Cash flows from operating activities |
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Loss for the period |
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( |
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( |
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Adjustments to reconcile net loss to net cash used in operating activities |
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Amortization of clinical trial deposit |
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3 |
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— |
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Depreciation of property and equipment |
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4 |
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Change in fair value of milestone liability |
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( |
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( |
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Warrants issued for services |
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6 |
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— |
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Stock option expense |
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6 |
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Changes in operating assets and liabilities |
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Prepaid expenses, deposits and other |
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( |
) |
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( |
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Clinical trial deposit |
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( |
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— |
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Accounts payable and accrued liabilities |
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( |
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Related party payables |
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( |
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( |
) |
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Net cash used in operating activities |
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( |
) |
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( |
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Cash flows from investing activities |
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Purchase of equipment |
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4 |
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( |
) |
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— |
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Net cash used in investing activities |
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( |
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— |
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Cash flows from financing activities |
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Net proceeds from the issuance of shares and warrants |
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6 |
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Warrants exercised for cash |
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6 |
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— |
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Series A Preferred cash dividend |
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5 |
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( |
) |
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( |
) |
Net cash provided by financing activities |
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(Decrease) increase in cash and cash equivalents |
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( |
) |
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||
Cash and cash equivalents – beginning of period |
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Cash and cash equivalents – end of period |
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Supplementary information (note 7) |
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The accompanying notes are an integral part of these condensed consolidated interim financial statements.
6
Kintara Therapeutics, Inc.
Notes to Condensed Consolidated Interim Financial Statements
(Unaudited)
December 31, 2022
(expressed in US dollars and in thousands, except par value and per share amounts, unless otherwise noted)
1 Nature of operations, corporate history, and going concern and management plans
Nature of operations
Kintara Therapeutics, Inc. (the “Company”) is a clinical-stage drug development company with a focus on the development of novel cancer therapies for patients with unmet medical needs. The Company is developing two late-stage, Phase 3-ready therapeutics - VAL-083 for glioblastoma and REM-001 for cutaneous metastatic breast cancer. In order to accelerate the Company’s development timelines, it leverages existing preclinical and clinical data from a wide range of sources. The Company may seek marketing partnerships in order to potentially offset clinical costs and to generate future royalty revenue from approved indications of its product candidates.
Corporate history
The Company is a Nevada corporation formed on June 24, 2009, under the name Berry Only, Inc. On January 25, 2013, the Company entered into and closed an exchange agreement (the “Exchange Agreement”), with Del Mar Pharmaceuticals (BC) Ltd. (“Del Mar (BC)”), 0959454 B.C. Ltd. (“Callco”), and 0959456 B.C. Ltd. (“Exchangeco”) and the security holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of the Company (the “Reverse Acquisition”).
On August 19, 2020, the Company completed its merger with Adgero Biopharmaceuticals Holdings, Inc., a Delaware corporation ("Adgero") in which Adgero continued its existence under Delaware law and became a direct, wholly-owned subsidiary of the Company. Following the completion of the merger, the Company changed its name from DelMar Pharmaceuticals, Inc. to Kintara Therapeutics, Inc. and began trading on The Nasdaq Capital Market LLC ("Nasdaq") under the symbol “KTRA”.
Kintara Therapeutics, Inc. is the parent company of Del Mar (BC), a British Columbia, Canada corporation and Adgero which are clinical-stage companies with a focus on the development of drugs for the treatment of cancer. The Company is also the parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition. In connection with the Adgero merger, the Company also became the parent company of Adgero Biopharmaceuticals, Inc. (“Adgero Bio”), formerly a wholly-owned subsidiary of Adgero.
References to the Company refer to the Company and its wholly-owned subsidiaries.
Going concern and management plans
These condensed consolidated interim financial statements have been prepared on a going concern basis which assumes that the Company will continue its operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the normal course of business.
For the six months ended December 31, 2022, the Company reported a loss of $
7
Consequently, management is pursuing various financing alternatives to fund the Company’s operations so it can continue as a going concern. In addition, the Company has paused the REM-001 program in order to conserve cash resources for the VAL-083 clinical study. Management plans to continue to pursue opportunities to secure the necessary financing through the issue of new equity, debt, and/or entering into strategic partnership arrangements. However, the Company’s ability to raise additional capital could be affected by various risks and uncertainties including, but not limited to, the effects of the COVID-19 pandemic and global unrest. The Company may not be able to raise sufficient additional capital and may tailor its drug candidate development programs based on the amount of funding the Company is able to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.
These condensed consolidated financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.
2 Significant accounting policies
Reverse stock split
On November 11, 2022, the Company completed a 1:
Basis of presentation
The condensed consolidated interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) and are presented in United States dollars. The functional currency of the Company and each of its subsidiaries is the United States dollar.
The accompanying condensed consolidated interim financial statements include the accounts of the Company and its wholly-owned subsidiaries, Adgero, Adgero Bio, Del Mar (BC), Callco, and Exchangeco. All intercompany balances and transactions have been eliminated in consolidation.
The principal accounting policies applied in the preparation of these condensed consolidated interim financial statements are set out below and have been consistently applied to all periods presented.
Unaudited interim financial data
The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim financial information. Accordingly, they do not include all of the information and the notes required by U.S. GAAP for complete financial statements. These unaudited condensed consolidated interim financial statements should be read in conjunction with the June 30, 2022 audited consolidated financial statements of the Company included in the Company’s Form 10-K filed with the SEC on September 27, 2022. In the opinion of management, the unaudited condensed consolidated interim financial statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation. The results for three and six months ended December 31, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2023, or for any other future annual or interim period.
Use of estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events that affect the reported amounts of assets, liabilities, expenses, contingent assets, and contingent liabilities as at the end of, or during, the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring management to make estimates include the valuation of equity instruments issued for services and clinical trial accruals. Further details of the nature of these assumptions and conditions may be found in the relevant notes to these condensed consolidated interim financial statements.
8
Loss per share
Income or loss per share is calculated based on the weighted average number of common shares outstanding. For the six-month periods ended December 31, 2022, and 2021, diluted loss per share does not differ from basic loss per share since the effect of the Company’s warrants, stock options, and convertible preferred shares is anti-dilutive. As of December 31, 2022, potential common shares of
Property and equipment
Property and equipment is stated at cost less accumulated depreciation. Depreciation is calculated on a straight-line basis over its estimated useful life of to
Recently issued accounting standards
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed consolidated interim financial statements.
3
In October 2020, the Company announced that it had entered into a final agreement with a contract research organization (“CRO”) for the management of the Company’s registrational study for glioblastoma. Under the agreement, the Company will supply the drug for the study and the CRO will manage all operational aspects of the study including site activation and patient enrollment. The Company is required to make certain payments under the agreement related to patient enrollment milestones. For the three and six months ended December 31, 2022, the Company has recognized $
During the six months ended December 31, 2022, the Company paid an additional $
4 Property and equipment, net
|
|
$ |
|
|
Balance, June 30, 2022 |
|
|
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Additions |
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|
Less depreciation |
|
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( |
) |
Balance, December 31, 2022 |
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|
|
At December 31, 2022, the total capitalized cost of property and equipment was $
5
Valent Technologies, LLC Agreements
One of the Company’s officers is a principal of Valent Technologies, LLC (“Valent”) and as a result Valent is a related party to the Company.
On September 12, 2010, the Company entered into a Patent Assignment Agreement (the “Valent Assignment Agreement”) with Valent pursuant to which Valent transferred to the Company all its right, title and interest in, and to, the patents for VAL-083 owned by Valent. The Company now owns all rights and title to VAL-083 and is responsible for further development and commercialization. In accordance with the terms of the Valent Assignment Agreement, Valent is entitled to receive a future royalty on all revenues derived from the development and commercialization of VAL-083. In the event that the Company terminates the agreement, the Company may be entitled to receive royalties from Valent’s subsequent development of VAL-083 depending on the development milestones the Company has achieved prior to the termination of the Valent Assignment Agreement.
9
On September 30, 2014, the Company entered into an exchange agreement (the “Valent Exchange Agreement”) with Valent and Del Mar (BC). Pursuant to the Valent Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $
Related party payables
As of December 31, 2022, there is an aggregate amount of $
6
Preferred stock
Series C Preferred Stock
|
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Series C Preferred Stock |
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|||||
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Number |
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$ |
|
||
Balance – June 30, 2022 |
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|
||
Conversion of Series C Preferred stock to common stock |
|
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( |
) |
|
|
( |
) |
Balance – December 31, 2022 |
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|
||
In August 2020, the Company issued
The Series C Preferred Stock dividends do not require declaration by the board of directors and are accrued annually as of the date the dividend is earned in an amount equal to the fair value of the Company’s common stock on the dates the respective dividends are paid. The fair value of the Series C Preferred Stock dividend paid on August 19, 2022 was determined by multiplying the dividends paid of
The Company’s Series C Preferred Stock outstanding, conversion shares, and aggregate dividends as of December 31, 2022, are as follows:
Series |
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Number |
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Conversion |
|
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Number of |
|
|
Dividend Shares (in thousands) |
|
||||
Series 1 |
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Series 2 |
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Series 3 |
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||||
10
Series C Dividends |
|
Dividend Shares |
|
|
10% - August 19, 2021 (actual) |
|
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|
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15% - August 19, 2022 (actual) |
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20% - August 19, 2023 (estimated) |
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25% - August 19, 2024 (estimated) |
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The Series C Preferred Stock shall with respect to distributions of assets and rights upon the occurrence of a liquidation, rank (i) senior to the Company’s common stock and (ii) senior to any other class or series of capital stock of the Company hereafter created which does not expressly rank pari passu with, or senior to, the Series C Preferred Stock. The Series C Preferred Stock is pari passu in liquidation to the Company’s Series A Preferred Stock. The liquidation value of the Series C Preferred Stock at December 31, 2022 is the stated value of $
Series B Preferred Stock
The Company previously issued Series B Preferred Stock that has since been fully converted into shares of common stock. As part of the Series B Preferred Stock financing, the Company and the Series B Preferred Stockholders entered into a royalty agreement, pursuant to which the Company will pay the holders of the Series B Preferred Stock, in aggregate, a single-digit royalty based on their pro rata ownership of the Series B Preferred Stock on VAL-083 products sold directly by the Company or sold pursuant to a licensing or partnering arrangement, should such events occur. The royalties payable on VAL-083 products sold by the Company have been earned and remain payable to the former Series B Preferred stockholders even though the Series B Preferred Stock has been fully converted to shares of common stock.
Series A Preferred Stock
Effective September 30, 2014, the Company filed a Certificate of Designation of Series A Preferred Stock (the “Series A Certificate of Designation”) with the Secretary of State of Nevada. Pursuant to the Series A Certificate of Designation, the Company designated
The Series A Preferred Stock shall with respect to distributions of assets and rights upon the occurrence of a liquidation, rank (i) senior to the Company’s common stock, and (ii) senior to any other class or series of capital stock of the Company hereafter created which does not expressly rank pari passu with, or senior to, the Series A Preferred Stock. The Series A Preferred Stock is pari passu in liquidation to the Company’s Series C Preferred Stock. The liquidation value of the Series A Preferred stock at December 31, 2022, is its stated value of $
There was
Common stock
Common stock issuances during the six months ended December 31, 2022
On August 2, 2022, the Company entered into a stock purchase agreement, dated as of August 2, 2022, (the “Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which Lincoln Park committed to purchase up to a maximum of $
11
Pursuant to the Purchase Agreement, the Company has the right, in its sole discretion, to present Lincoln Park with a purchase notice directing Lincoln Park to purchase up to
If the Company directs Lincoln Park to purchase the maximum number of shares of common stock that the Company may sell in a Regular Purchase, then in addition to such Regular Purchase, and subject to certain conditions and limitations in the Purchase Agreement, the Company may direct Lincoln Park to purchase additional shares of common stock in an “accelerated purchase” (each, an “Accelerated Purchase”) and an “additional accelerated purchase” (each, an “Additional Accelerated Purchase”) (including multiple Additional Accelerated Purchases on the same trading day) as provided in the Purchase Agreement. The purchase price per share for each Accelerated Purchase and Additional Accelerated Purchase will be based on market prices of the common stock on the applicable purchase date for such Accelerated Purchases and such Additional Accelerated Purchases.
The aggregate number of shares that the Company can issue or sell to Lincoln Park under the Purchase Agreement may in no case exceed
During the six months ended December 31, 2022, the Company sold
Common stock issuances during the six months ended December 31, 2021
Registered direct financing
On September 28, 2021,
The net proceeds from the September Offering were $
The 2022 Investor Warrants are exercisable at $
12
During the six months ended December 31, 2021, all of the
Stock options
2017 Omnibus Incentive Plan
The Company’s board of directors has approved the adoption of the Company’s 2017 Omnibus Equity Incentive Plan (the “2017 Plan”). The 2017 Plan, as amended, was subsequently approved at an annual meeting of stockholders on April 11, 2018. As approved by the Company’s stockholders on June 21, 2022, the number of common shares available under the 2017 Plan as of December 31, 2022 is
The following table sets forth the aggregate information on all equity compensation plans as of December 31, 2022:
Plan (in thousands, except per share amounts) |
|
Number of shares of common stock to be issued upon exercise of outstanding stock options |
|
|
Weighted-average exercise price of outstanding stock options |
|
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Number of stock options remaining available for future issuance under equity compensation plans(2) |
|
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Equity compensation plans approved by security holders - 2017 Plan |
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Equity compensation plans not approved by security holders - Del Mar (BC) 2013 Amended and Restated Stock Option Plan(1) |
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— |
|
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Totals |
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(1) The Del Mar (BC) 2013 Amended and Restated Stock Option Plan refers to the Company’s previous equity compensation plan under which
(2) The balance of
The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any calendar year is
During the six months ended December 31, 2022, a total of
The following table sets forth changes in stock options outstanding under all plans:
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Number of |
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Weighted |
|
||
Balance – June 30, 2022 |
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Granted |
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Expired |
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( |
) |
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Balance – December 31, 2022 |
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13
The following table summarizes stock options outstanding and exercisable under all plans at December 31, 2022:
Exercise price |
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Number |
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Weighted |
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Number |
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— |
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Stock options granted during the six months ended December 31, 2022, have been valued using a Black-Scholes pricing model with the following assumptions:
|
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December 31, 2022 |
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Dividend rate |
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— |
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% |
Estimated volatility |
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% |
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Risk-free interest rate |
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% |
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Expected term – years |
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The estimated volatility of the Company’s common stock at the date of issuance of the stock options is based on the historical volatility of the Company. The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining term of the stock options at the valuation date. The expected term of the stock options has been estimated using the plain vanilla method.
The Company has recognized the following amounts as stock option expense for the periods noted (in thousands):
|
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Three months ended |
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Six months ended |
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2022 |
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2021 |
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2022 |
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2021 |
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Research and development |
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General and administrative |
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|
||||
All of the stock option expense for the periods ended December 31, 2022, and 2021, has been recognized as additional paid in capital. The aggregate intrinsic value of stock options outstanding as well as stock options exercisable was $
The following table sets forth changes in unvested stock options under all plans:
|
|
Number of |
|
|
Weighted |
|
||
Unvested at June 30, 2022 |
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Granted |
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Vested |
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( |
) |
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Unvested at December 31, 2022 |
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|
||
The aggregate intrinsic value of unvested stock options at December 31, 2022, was $
Restricted stock units
14
As of December 31, 2022, the Company has issued
Common stock warrants
The following table sets forth changes in outstanding common stock warrants:
|
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Number of |
|
|
Weighted |
|
||
Balance – June 30, 2022 |
|
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|
||
Expiry of 2018 Investor and Agent warrants |
|
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( |
) |
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|
|
Balance – December 31, 2022 |
|
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|
||
The following table summarizes the Company’s outstanding common stock warrants as of December 31, 2022:
Description of warrants |
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Number |
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Exercise |
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Expiry date |
||
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2022 April Investor warrants |
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2022 Investor warrants |
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2020 Investor warrants |
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2019 Investor warrants |
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NBTS Warrants |
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Warrants issued for services |
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2022 April Agent warrants |
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2022 Agent warrants |
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|
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2019 Agent warrants |
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|
||
Series C Preferred Stock warrants
In connection with the Series C Preferred Stock private placement, the Company issued
The following table sets forth changes in outstanding Series C Agent Warrants:
|
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Balance |
|
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Number of |
|
|
Number of |
|
|
Balance, |
|
|
Conversion |
|
|||||
Preferred Series C-1 Agent Warrants |
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Preferred Series C-2 Agent Warrants |
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Preferred Series C-3 Agent Warrants |
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|||||
15
The following table summarizes the Company’s outstanding Series C Agent Warrants as of December 31, 2022:
Series C Agent Warrants |
|
Number |
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Conversion |
|
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Number of |
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|
Cumulative |
|
||||
Series 1 |
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Series 2 |
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Series 3 |
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7
The Company incurred the following non-cash investing and financing transactions (in thousands):
|
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Six months ended |
|
|||||
|
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2022 |
|
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2021 |
|
||
Series C Preferred Stock common stock dividend (note 6) |
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Non-cash issue costs (note 6) |
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|
||
Equipment additions reclassified from prepaid expenses |
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— |
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Income taxes paid |
|
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— |
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— |
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Interest paid |
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— |
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— |
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8
The Company's financial instruments are measured at fair value as determined by using the fair value hierarchy for inputs that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of inputs that may be used to measure fair value are as follows:
Level one - inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level two - inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals; and
Level three - unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.
Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.
|
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December 31, 2022 |
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Liability |
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Level 1 |
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Level 2 |
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Level 3 |
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Milestone payment liability |
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— |
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— |
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The Company’s financial instruments consist of cash and cash equivalents, other receivables, accounts payable, and related party payables. The carrying values of cash and cash equivalents, other receivables, accounts payable and related party payables approximate their fair values due to the immediate or short-term maturity of these financial instruments.
9 Subsequent events
Series C Preferred Stock
16
Subsequent to December 31, 2022,
The Company has evaluated its subsequent events from December 31, 2022, through the date these condensed consolidated interim financial statements were issued and has determined that there are no subsequent events requiring disclosure in these condensed consolidated interim financial statements other than noted above.
17
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Management’s Discussion and Analysis (“MD&A”) contains “forward-looking statements”, within the meaning of the Private Securities Litigation Reform Act of 1995, which represent our projections, estimates, expectations, or beliefs concerning, among other things, financial items that relate to management’s future plans or objectives or to our future economic and financial performance. In some cases, you can identify these statements by terminology such as “may”, “should”, “plans”, “believe”, “will”, “anticipate”, “estimate”, “expect” “project”, or “intend”, including their opposites or similar phrases or expressions. You should be aware that these statements are projections or estimates as to future events and are subject to a number of factors that may tend to influence the accuracy of the statements. These forward-looking statements should not be regarded as a representation by us or any other person that our events or plans will be achieved. You should not unduly rely on these forward-looking statements, which speak only as of the date of this report. Except as may be required under applicable securities laws, we undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this report or to reflect the occurrence of unanticipated events.
You should review the factors and risks we describe under “Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2022, and in our other filings with the Securities and Exchange Commission, available at www.sec.gov. Actual results may differ materially from any forward-looking statement.
Background
Kintara Therapeutics, Inc. is a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. On August 19, 2020, the Company completed its merger with Adgero Biopharmaceuticals Holdings, Inc., a Delaware corporation ("Adgero") in which Adgero continued its existence under Delaware law and became a direct, wholly-owned subsidiary of the Company. Following the completion of the merger, we changed our name from DelMar Pharmaceuticals, Inc. to Kintara Therapeutics, Inc. and began trading on The Nasdaq Capital Market LLC ("Nasdaq") under the symbol “KTRA”.
We are the parent company of Del Mar (BC), a British Columbia, Canada corporation, and Adgero. We are also the parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition that occurred in 2013.
References to “we”, “us”, and “our”, refer to Kintara and our wholly-owned subsidiaries, Del Mar (BC), Adgero, Adgero Bio, Callco, and Exchangeco.
We are dedicated to the development of novel cancer therapies for patients with unmet medical needs. Our mission is to benefit patients by developing and commercializing anti-cancer therapies for patients whose solid tumors exhibit features that make them resistant to, or unlikely to respond to, currently available therapies, with particular focus on orphan cancer indications.
Our two lead candidates are VAL-083, a novel, validated, DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma (“GBM”) and potentially other solid tumors, including ovarian cancer, non-small cell lung cancer (“NSCLC”), and diffuse intrinsic pontine glioma (“DIPG”), and REM-001, a late-stage photodynamic therapy (“PDT”) for the treatment of cutaneous metastatic breast cancer (“CMBC”). PDT is a treatment that uses light sensitive compounds, or photosensitizers, that, when exposed to specific wavelengths of light, act as a catalyst to produce a form of reactive oxygen that induces local tumor cell death. We have paused the REM-001 program in order to conserve cash resources.
Recent Events
Targeted Clinical Milestones
18
We expect topline results 12 months after the last patient is randomized for our Global Coalition for Adaptive Research (“GCAR”) GBM Adaptive Global Innovative Learning Environment (“AGILE”) international registrational Phase 2/3 clinical study for VAL-083 (the “GBM AGILE Study”). We estimate these results to be available around the end of the fourth quarter of calendar 2023.
Product Pipeline
VAL-083
Background
VAL-083 is a first-in-class, small-molecule, DNA-targeting chemotherapeutic that has demonstrated activity against a range of tumor types in prior human Phase 1 and Phase 2 clinical studies sponsored by the US National Cancer Institute (“NCI”). “First-in-class” means that VAL-083 embodies a unique molecular structure which is not an analogue, or derivative, of any approved product, or product under development, for the treatment of cancer. As part of our business strategy, we leverage and build upon these prior NCI investments and data from more than 40 NCI Phase 1 and Phase 2 clinical studies, which includes an estimated 1,200 patient safety database.
In GBM, we are part of the GBM AGILE Study which is an international registrational Phase 2/3 clinical study for GBM. The study is a patient centered, adaptive platform study for registration evaluating multiple therapies for patients with newly-diagnosed and recurrent GBM. Patients in the GBM AGILE Study are tested for their O6-methyl guanine methyltransferase ("MGMT") methylation status prior to enrollment. VAL-083 is being evaluated in all three GBM patient subtypes in this study: newly-diagnosed methylated MGMT; newly-diagnosed unmethylated MGMT; and recurrent.
We have also completed two open-label, biomarker-driven, Phase 2 studies in MGMT-unmethylated GBM. MGMT is a DNA-repair enzyme that is associated with resistance to temozolomide ("TMZ" or Temodar®), the current standard-of-care chemotherapy used in the treatment of GBM. More than 60% of GBM patients have MGMT-unmethylated tumors and exhibit a high expression of MGMT which is correlated with TMZ resistance, treatment failure, and poor patient outcomes as indicated in the current National Comprehensive Cancer Network (“NCCN”) guidelines for GBM treatment. Our research demonstrates that VAL-083’s anti-tumor activity is independent of MGMT expression. In our completed Phase 2 studies we used MGMT as a biomarker to identify patients for treatment with VAL-083 in three distinct GBM unmethylated MGMT patient populations: newly-diagnosed first line, newly-diagnosed adjuvant, and recurrent.
19
In addition, we have undertaken research in ovarian cancer. Ovarian cancer is the fifth most common cancer in women and is the leading cause of death among women diagnosed with gynecological malignancies. We are in the process of evaluating the best path forward in ovarian cancer including the potential combination of VAL-083 with PARP inhibitors. The FDA granted orphan drug designation for the use of VAL-083 in the treatment of ovarian cancer.
We have a broad patent portfolio to protect our intellectual property. Our patents and patent applications claim methods of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083. We believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of VAL-083 in the United States and other international markets. In addition, VAL-083 has been designated by the FDA as an orphan drug under the Orphan Drug Act and the European Medicines Agency (“EMA”) for the treatment of gliomas, including GBM. The FDA has also granted Orphan Drug description to VAL-083 for the treatment of medulloblastoma and ovarian cancer.
Our corporate strategy is to advance VAL-083 on an indication-by-indication basis, and then to consider out-licensing when a corporate development program has matured enough to warrant proper licensing valuations. In addition to VAL-083’s applicability to multiple solid tumor indications, we are also constantly evaluating licensing or acquiring additional product candidates, in order to establish a product pipeline and to position us for long-term sustainability and growth of shareholder value. We believe the experience of our clinical development team will position us to efficiently develop possible drug candidates that we may acquire, or license, in the future.
We intend to continue to evaluate options for our strategic direction. These options may include raising additional capital, the acquisition of another company and/or complementary assets, our sale, or another type of strategic partnership.
VAL-083 Clinical Studies
GBM AGILE Study
On October 21, 2020, we announced we had entered into a definitive agreement with GCAR and on January 13, 2021, we announced the initiation of patient recruitment for the VAL-083 study arm of the GBM AGILE Study. VAL-083 is currently being evaluated in all three GBM patient subtypes in the GBM AGILE Study: newly-diagnosed methylated MGMT; newly-diagnosed unmethylated MGMT; and recurrent.
The GBM AGILE Study employs a cost-efficient, adaptive study design with a stage 1 learning and adapting phase and a stage 2 expansion and confirmation phase. The Kintara arm of the GBM AGILE Study is ongoing at 39 clinical sites in the United States, four in Canada, and two in Europe. GCAR has previously announced that the GBM AGILE Study has screened over 1,300 patients and that enrollment rates for the study are 3 to 4 times greater than traditional GBM studies, with active sites averaging 0.75 to 1 patient per site per month. The GBM AGILE Study, which was designed by GCAR with input from the FDA, restricts companies participating in the study from disclosing data and other information before the end of the study in order to protect the integrity of the individual trial arm data, as well as the overall study. We expect to announce topline data from the GBM AGILE Study around the end of calendar 2023.
The GBM AGILE Study is an international, innovative platform study designed to more rapidly identify and confirm effective therapies for patients with glioblastoma through response adaptive randomization and a seamless Phase 2/3 design. The study, conceived by over 130 key opinion leaders, is conducted under a master protocol, allowing multiple therapies or combinations of therapies from different pharmaceutical partners to be evaluated simultaneously. With its innovative design and efficient operational infrastructure, we believe data from the GBM AGILE Study can be used as the foundation for a New Drug Application (“NDA”) and biologics license application submissions and registrations to the FDA and other health authorities. As with any clinical trial, there is a high likelihood of failure, and this is particularly the case with a study for a difficult to treat indication such as GBM.
GCAR is a 501(c)(3) nonprofit organization uniting physicians, clinical researchers, advocacy and philanthropic organizations, biopharma, health authorities, and other key stakeholders in healthcare to expedite the discovery and development of treatments for patients with rare and deadly diseases by serving as a sponsor of innovative and complex studies including master protocols and platform studies. GCAR is the sponsor of GBM AGILE. Key strategic partners for the GBM AGILE Study effort include the National Brain Tumor Society (“NBTS”), National Foundation for Cancer Research, and Asian Fund for Cancer Research.
Safety Across Studies
Consistent with prior studies, myelosuppression was the most common adverse event with VAL-083 in both the recurrent GBM and adjuvant treatment settings in our completed Phase 2 studies. In the 30 mg/m2/day starting dose cohort (the dose being studied in the GBM AGILE Study) five subjects experienced a serious adverse event (“SAE”) possibly related to VAL-083 in the recurrent group and one patient experienced a possible drug-related SAE in the newly-diagnosed adjuvant group.
20
In the newly-diagnosed first-line Phase 2 study three subjects experienced an SAE possibly related to VAL-083. Multiple treatment cycles of VAL-083 at the 30 mg/m2/day dose in combination with standard radiation treatment (2 Gray/day, 5 days/week) were shown to be generally safe and well-tolerated.
Current Treatments for Gliomas and Glioblastoma
Gliomas are a type of Central Nervous System (“CNS”) tumor that arises from glial cells in the brain or spine. Glial cells are the cells surrounding nerves. Their primary function is to provide support and protection for neurons in the CNS.
Common symptoms of GBM include headaches, seizures, nausea, weakness, paralysis and personality or cognitive changes such as loss of speech or difficulty in thinking clearly. GBM progresses quickly and patients’ conditions deteriorate rapidly progressing to death. The outlook for GBM patients is generally poor. The overall median survival in newly diagnosed GBM patients with best available treatments is less than 15 months, and two-year and five-year survival rates are approximately 30% and 10%, respectively. Median overall survival in newly-diagnosed, unmethylated GBM patients is 12.2 months.
The recommended treatment regimen for GBM includes surgical resection to remove as much of the tumor as possible (“debulking”) followed by radiotherapy with concomitant and adjuvant chemotherapy with TMZ with or without tumor treating fields (“TTF”). GBM patients whose tumors exhibit an unmethylated promoter for the gene encoding the DNA repair enzyme MGMT, a biomarker correlated with resistance to TMZ, may be treated with radiation alone following surgery.
Patients with an unmethylated MGMT promoter have high levels of MGMT, a naturally-occurring DNA repair enzyme that repairs tumor-fighting lesions induced by TMZ thus allowing a patient’s tumor to continue to grow despite treatment, which leads to poor outcomes. Measurement of MGMT methylation status has become routine in clinical practice as biomarker that correlates with response to TMZ and patient outcomes in GBM.
Probability of GBM Patient Survival Correlated to Expression of MGMT Enzyme (Unmethylated promoter = High MGMT Expression and Significantly Shorter Survival)
TTF (Optune®) is a non-invasive technique for adults with GBM. TTF uses alternating electrical fields to disrupt tumor cell division, or cause cell death, thereby preventing the tumor from growing or spreading as quickly. A clinical study reported that GBM patients treated with TTF combined with TMZ experienced longer survival than those treated with TMZ alone.
The majority of GBM patients’ tumors recur within 6 – 12 months of initial treatment. Experimental therapy through clinical studies is recommended under NCCN guidelines for eligible patients. NCCN guidelines also recommend treatment with systemic chemotherapy, such as lomustine (“CCNU”). For patients who are eligible for additional surgical debulking, local chemotherapy with carmustine (“BCNU”) wafers may be employed. CCNU and BCNU target the same DNA-site as TMZ and are also subject to MGMT-related resistance.
Avastin (Avastin®, an anti-VEGF antibody) recently received full approval in the US, Canada, Australia, and Japan as a single agent for patients with recurrent GBM following prior therapy. Avastin carries an FDA “black-box warning” related to severe, sometimes fatal, side effects such as gastrointestinal perforations, wound healing complications and hemorrhage. There are no data demonstrating an improvement in disease-related symptoms or increased survival for GBM patients treated with Avastin.
21
Recurrent GBM patients, especially those whose tumors progress following treatment with Avastin, have limited or no treatment options and a very poor prognosis. According to published literature, the median survival for GBM patients whose tumors progress following Avastin is less than five months.
VAL-083 Mechanism of Action
Chemotherapy forms the basis of treatment in nearly all cancers. We believe that VAL-083 may be effective in treating tumors exhibiting biological features that cause resistance to currently available chemotherapy, particularly for patients who have failed, or become resistant to, other treatment regimens.
Based on published research and our own data, the cytotoxic functional groups, and the mechanism of action of VAL-083 are functionally different from alkylating agents commonly used in the treatment of cancer. VAL-083 has previously demonstrated activity in cell lines that are resistant to other types of chemotherapy. No evidence of cross-resistance has been reported in published clinical studies.
Our research suggests that VAL-083 attacks cancer cells via a unique mechanism of action that is distinct from other chemotherapies used in the treatment of cancer. Our data indicate that VAL-083 forms inter-strand crosslinks at the N7 position of guanine on the DNA of cancer cells. Our data also indicate that this crosslink forms rapidly and is not easily repaired by the cancer cell, resulting in cell-cycle arrest and lethal double-strand DNA breaks in cancer cells. VAL-083 readily crosses the blood brain barrier. Published preclinical and clinical research demonstrate that VAL-083 is absorbed more readily in tumor cells than in normal cells.
In vitro, our data also demonstrate that VAL-083’s distinct mechanism may be able to overcome drug resistance against a range of cancers. For example, VAL-083 is active against MGMT-unmethylated GBM cells which are resistant to treatment with TMZ and nitrosoureas. VAL-083 also retains a high level of activity in p53 mutated non-small cell lung cancer (“NSCLC”), ovarian cancer and medulloblastoma cell lines that are resistant to platinum-based chemotherapy.
Importantly, clinical activity against each of the tumors mentioned above was established in prior NCI-sponsored Phase 2 clinical studies. We believe that these historical clinical data and our own research support the development of VAL-083 as a potential new treatment for multiple types of cancer.
The main dose-limiting toxicity (“DLT”) related to the administration of VAL-083 in previous NCI-sponsored clinical studies and our own clinical studies is myelosuppression, particularly thrombocytopenia. Myelosuppression, including thrombocytopenia, is a common side effect of chemotherapy. Myelosuppression is the decrease in cells responsible for providing immunity, carrying oxygen, and causing normal blood clotting. Thrombocytopenia is a reduction in platelet counts which assist in blood clotting. Modern medicine allows for better management of myelosuppressive side effects. We believe this offers the potential opportunity to improve upon the drug’s already established efficacy profile by substantially increasing the dose of VAL-083 that can be safely administered to cancer patients.
REM-001
Background
Through REM-001, we are developing our photodynamic therapy (“PDT”) for the treatment of rare, unmet medical needs. PDT is a treatment that uses light sensitive compounds, or photosensitizers, that, when exposed to specific wavelengths of light, act as catalysts to produce a form of oxygen that induces local tumor cell death. REM-001 consists of three parts, the laser light source, the light delivery device, and the REM-001 drug product (collectively, the “REM-001 Therapy”). REM-001 consists of an active pharmaceutical ingredient (“API”) in a lipid formulation. The REM-001 API is SnET2 (“tin ethyl etiopurpurin”) which is a second-generation PDT photosensitizer agent. We believe REM-001 possesses multiple advantages over earlier generation PDT compounds.
Our lead indication for REM-001 is CMBC which is a disease that may strike individuals with advanced breast cancer and for which effective treatment options are limited. In four Phase 2 and/or Phase 3 clinical studies in CMBC patients, primarily targeting patients who had previously received chemotherapy and failed radiation therapy, REM-001 Therapy was able to reduce, or eliminate, a substantial number of the treated CMBC tumors. Specifically, our analysis of the data collected from these studies indicates that in approximately 80% of evaluable tumor sites treated with REM-001 Therapy, there was a complete response; meaning that follow-up clinical assessments indicated no visible evidence of the tumor remaining. We believe clinical data indicates that REM-001 Therapy holds promise as a treatment to locally eliminate, or slow the growth of, treated cutaneous cancerous tumors in this difficult-to-treat patient population.
22
Numerous approaches have been utilized to treat CMBC patients, including various forms of chemotherapy, radiation therapy, surgical excision, hyperthermia, cryotherapy, electro-chemotherapy, topical drugs, and intra-lesional chemotherapy injections. However, for the most part, we believe that these therapies are often inadequate given the limited efficacy, toxicities and/or side effects of each. We believe our REM-001 Therapy has several advantages for this indication: it can be highly directed to the tumor site, has minimal systemic effects or normal tissue toxicities, can be used in conjunction with other therapies, and can be periodically repeated.
Our REM-001 Therapy product consists of three parts: the DD series laser light source (or equivalent), the ML2-0400 light delivery device (or equivalent) and the drug REM-001. In use, REM-001 is first administered by intravenous infusion and allowed to distribute within the body and be taken up by the tumors. Tumors are then illuminated with light using the light delivery device, which is attached to the laser light source, so that the accumulated REM-001 can be activated for the desired clinical effect.
As a result of our review of the historical data, we submitted questions to the FDA under a Type C format to review the technology and results and determine the anticipated requirements for regulatory approval. On March 3, 2017, we received the FDA’s written response to these questions. Based on that response, we have successfully manufactured REM-001 and developed light delivery devices for our planned 15-patient Phase 2 study. We received a Study May Proceed letter from the FDA for our 15-patient study on August 9, 2022.
On October 19, 2022, we announced that the REM-001 program in CMBC was paused to conserve cash which will be used to support the funding of the GBM AGILE Study. By pausing the REM-001 program, we expect to save approximately $3.0 million through calendar 2023.
VAL-083 and REM-001 Fast Track Designations
The FDA has granted us FTD for VAL-083 in recurrent and newly-diagnosed unmethylated GBM and for REM-001 in CMBC.
The FTD is designed to expedite the review of drugs that show promise in treating life-threatening diseases and address unmet medical needs, with the goal of getting new treatments to patients earlier. FTD provides sponsors with an opportunity for increased frequency for communication with the FDA to ensure an optimal development plan and to collect appropriate data needed to support drug approval. Additional benefits of the FTD may include an Accelerated Approval, a Priority Review, and a Rolling Review. Accelerated Approval is granted to drugs that demonstrate an effect on a surrogate, or intermediate endpoints, reasonably likely to predict clinical benefit. Priority Review shortens the FDA review process for a new drug from ten months to six months and is appropriate for drugs that demonstrate significant improvements in both safety and efficacy of an existing therapy. Rolling Review provides a drug company the opportunity to submit completed sections of its NDA for review by the FDA. Typically, NDA reviews do not commence until the drug company has submitted the entire application to the FDA. Through the FTD, the FDA attempts to ensure that questions raised during the drug development process are resolved quickly, often leading to earlier approval and increased access for patients.
Impact of COVID-19
In March 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic and a public health emergency of international concern. The global spread of COVID-19, including new and emerging variants, has created significant volatility and uncertainty since March 2020 and may continue into the future.
Regarding the VAL-083 study arm of the GBM AGILE Study that is ongoing at multiple sites in the United States, Canada and Europe, we have not experienced any significant COVID-19 impacts on patient enrollment or treatment. With respect to the REM-001 drug supply, we have previously experienced some delays in contract manufacturing schedules and supplies which we attribute to COVID-19. As a result of our decision to pause the REM-001 program in order to conserve cash resources, the previous delays should not have an impact on our REM-001 program timeline.
We are unable to accurately predict the full impact that COVID-19 will have on our business, results of operations, and financial conditions due to numerous uncertainties, including the full scope of the disease, the duration of the outbreak, the number and intensity of subsequent waves of infections, actions that may be taken by governmental authorities, the impact to the businesses of third parties we rely on, the development of treatments and vaccines, and other factors identified under “Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2022. We will continue to evaluate the nature and extent of the impact to our business, results of operations, and financial condition.
Corporate History
We are a Nevada corporation formed on June 24, 2009, under the name Berry Only Inc. On January 25, 2013, we entered into and closed an exchange agreement (the “Exchange Agreement”), with Del Mar Pharmaceuticals (BC) Ltd. (“Del Mar (BC)”), 0959454 B.C. Ltd. (“Callco”), and 0959456 B.C. Ltd. (“Exchangeco”) and the security holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of ours (the “Reverse Acquisition”).
23
On August 19, 2020, we acquired Adgero and changed our name from DelMar Pharmaceuticals, Inc. to Kintara Therapeutics, Inc. We are the parent company to the following entities:
Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010, which is a clinical stage company with a focus on the development of drugs for the treatment of cancer;
Adgero, a Delaware corporation incorporated on October 26, 2015, which is a clinical stage company with a focus on the development of photodynamic therapy for the treatment of rare, unmet medical needs, specifically orphan cancer indications;
Adgero Biopharmaceuticals, Inc. a Delaware corporation incorporated on November 16, 2007; and
Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition.
Outstanding Securities
As of February 13, 2023, we had 1,675 shares of common stock issued and outstanding, outstanding warrants to purchase 714 shares of common stock, warrants to purchase 2,444 shares of our Series C Preferred Stock that upon exercise are convertible into 42 shares of common stock, outstanding stock options to purchase 241 shares of common stock, 14,258 outstanding shares Series C Preferred Stock that are convertible into 246 shares of common stock. All common stock warrants and stock options are convertible, or exercisable into, one share of common stock. The Series C Preferred Stock (issued in three series) is convertible into shares of common stock at $58 per share (Series C-1), $60.70 per share (Series C-2) or $57.50 per share (Series C-3), respectively. The Series C Preferred stock purchase warrants are convertible into Series C Preferred Stock at $1,000 per share for either Series C-1, Series C-2, or Series C-3 Preferred Stock, as applicable.
Selected Quarterly Information
The financial information reported herein has been prepared in accordance with accounting principles generally accepted in the United States. Our functional currency at December 31, 2022, and June 30, 2022, is the US$. The following tables represent selected financial information for us for the periods presented. All amounts in the remainder of this MD&A are expressed in thousands, except par value and per share amounts, unless otherwise noted.
Selected Balance Sheet Data
|
|
December 31, |
|
|
June 30, |
|
||
|
|
(in thousands) |
|
|||||
Cash and cash equivalents |
|
|
4,874 |
|
|
|
11,780 |
|
Working capital |
|
|
5,939 |
|
|
|
9,268 |
|
Total assets |
|
|
9,917 |
|
|
|
15,948 |
|
Total stockholders’ equity |
|
|
6,598 |
|
|
|
11,795 |
|
24
Selected Statement of Operations Data
For the three months ended
|
|
December 31, |
|
|
December 31, |
|
||
|
|
$ |
|
|
$ |
|
||
|
|
(in thousands, except per share data) |
|
|||||
Expenses |
|
|
|
|
|
|
||
Research and development |
|
|
2,059 |
|
|
|
3,902 |
|
General and administrative |
|
|
1,440 |
|
|
|
1,993 |
|
|
|
|
(3,499 |
) |
|
|
(5,895 |
) |
Other income |
|
|
|
|
|
|
||
Foreign exchange |
|
|
— |
|
|
|
1 |
|
Interest, net |
|
|
45 |
|
|
|
1 |
|
|
|
|
45 |
|
|
|
2 |
|
Net loss for the period |
|
|
(3,454 |
) |
|
|
(5,893 |
) |
Series A Preferred cash dividend |
|
|
(2 |
) |
|
|
(2 |
) |
Net loss for the period attributable to common stockholders |
|
|
(3,456 |
) |
|
|
(5,895 |
) |
Basic and fully diluted weighted average number of shares |
|
|
1,643 |
|
|
|
971 |
|
Basic and fully diluted loss per share |
|
|
(2.10 |
) |
|
|
(6.07 |
) |
For the six months ended
|
|
December 31, |
|
|
December 31, |
|
||
|
|
$ |
|
|
$ |
|
||
|
|
(in thousands, except per share data) |
|
|||||
Expenses |
|
|
|
|
|
|
||
Research and development |
|
|
5,230 |
|
|
|
7,695 |
|
General and administrative |
|
|
2,915 |
|
|
|
4,171 |
|
|
|
|
(8,145 |
) |
|
|
(11,866 |
) |
Other income |
|
|
|
|
|
|
||
Foreign exchange |
|
|
11 |
|
|
|
5 |
|
Interest, net |
|
|
84 |
|
|
|
2 |
|
|
|
|
95 |
|
|
|
7 |
|
Net loss for the period |
|
|
(8,050 |
) |
|
|
(11,859 |
) |
Series A Preferred cash dividend |
|
|
(4 |
) |
|
|
(4 |
) |
Series C Preferred stock dividend |
|
|
(362 |
) |
|
|
(2,462 |
) |
Net loss for the period attributable to common stockholders |
|
|
(8,416 |
) |
|
|
(14,325 |
) |
Basic and fully diluted weighted average number of shares |
|
|
1,554 |
|
|
|
828 |
|
Basic and fully diluted loss per share |
|
|
(5.42 |
) |
|
|
(17.30 |
) |
Expenses, net of non-cash, share-based compensation expense – non-GAAP
The following table discloses research and development, and general and administrative expenses net of non-cash, share-based compensation payment expense. The disclosure has been provided to reconcile the total operational expenses on a GAAP basis and the non-GAAP operational expenses net of non-cash stock-based compensation in order to provide an estimate of cash used in research and development, and general and administrative expense. Management uses the cash basis of expenses for forecasting and budget purposes to determine the allocation of resources and to plan for future financing opportunities.
25
For the three months ended
|
|
December 31, |
|
|
December 31, |
|
||
|
|
(in thousands) |
|
|||||
Research and development - GAAP |
|
|
2,059 |
|
|
|
3,902 |
|
Less: non-cash, share-based compensation expense |
|
|
(134 |
) |
|
|
(249 |
) |
Research and development net of non-cash, share-based, compensation expense – Non-GAAP |
|
|
1,925 |
|
|
|
3,653 |
|
General and administrative - GAAP |
|
|
1,440 |
|
|
|
1,993 |
|
Less: non-cash, share-based compensation expense |
|
|
(302 |
) |
|
|
(585 |
) |
General and administrative net of non-cash, share-based, compensation expense – Non-GAAP |
|
|
1,138 |
|
|
|
1,408 |
|
For the six months ended
|
|
December 31, |
|
|
December 31, |
|
||
|
|
(in thousands) |
|
|||||
Research and development - GAAP |
|
|
5,230 |
|
|
|
7,695 |
|
Less: non-cash, share-based compensation expense |
|
|
(274 |
) |
|
|
(493 |
) |
Research and development net of non-cash, share-based, compensation expense – Non-GAAP |
|
|
4,956 |
|
|
|
7,202 |
|
General and administrative - GAAP |
|
|
2,915 |
|
|
|
4,171 |
|
Less: non-cash, share-based compensation expense |
|
|
(680 |
) |
|
|
(1,183 |
) |
General and administrative net of non-cash, share-based, compensation expense – Non-GAAP |
|
|
2,235 |
|
|
|
2,988 |
|
Results of Operations
Comparison of the three months ended December 31, 2022, and December 31, 2021
|
|
Three months ended |
|
|
|
|
|
|
|
|||||||
|
|
December 31, |
|
|
December 31, |
|
|
Change $ |
|
|
Change % |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Research and development |
|
|
2,059 |
|
|
|
3,902 |
|
|
|
(1,843 |
) |
|
|
(47 |
) |
General and administrative |
|
|
1,440 |
|
|
|
1,993 |
|
|
|
(553 |
) |
|
|
(28 |
) |
|
|
|
(3,499 |
) |
|
|
(5,895 |
) |
|
|
2,396 |
|
|
|
|
|
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign exchange |
|
|
— |
|
|
|
1 |
|
|
|
(1 |
) |
|
|
(100 |
) |
Interest, net |
|
|
45 |
|
|
|
1 |
|
|
|
44 |
|
|
|
4,400 |
|
|
|
|
45 |
|
|
|
2 |
|
|
|
43 |
|
|
|
|
|
Net loss |
|
|
(3,454 |
) |
|
|
(5,893 |
) |
|
|
2,439 |
|
|
|
|
|
Research and Development
Research and development expenses decreased to $2,059 for the three months ended December 31, 2022, from $3,902 for the three months ended December 31, 2021. The decrease was largely attributable to lower clinical development costs, and non-cash, share-based compensation expenses incurred during the three months ended December 31, 2022, compared to the three months ended December 31, 2021.
26
Clinical development costs have decreased in the current quarter compared to the same quarter in the prior fiscal year in part due to costs related to the GBM AGILE Study being lower in the three months ended December 31, 2022, compared to the three months ended December 31, 2021. In addition, on October 19, 2022 we announced that we had paused the REM-001 program in order to preserve cash for the development of VAL-083. As a result, costs for REM-001 were lower in the current quarter compared to the same quarter in the prior fiscal year. Non-cash, share-based compensation expense decreased to $134 for the three months ended December 31, 2022, from $249 for the three months ended December 31, 2021, due to the higher compensation expense recognized during the three months ended December 31, 2021 for stock options granted in September 2021.
General and Administrative
General and administrative expenses were $1,440 for the three months ended December 31, 2022, compared to $1,993 for the three months ended December 31, 2021. A significant portion of the decrease was a result of lower non-cash, share-based compensation expenses, and a reduction in personnel costs in the current three months compared to the same period in the prior fiscal year. Non-cash, share-based compensation expense decreased to $302 for the three months ended December 31, 2022, from $581 for the three months ended December 31, 2021, due to the recognition of higher compensation expense recognized during the three months ended December 31, 2021, for stock options granted in September 2021. Personnel costs have decreased in the current quarter compared to the same quarter in the prior fiscal year largely due to a reduction in staff.
Preferred Share Dividends
For each of the three months ended December 31, 2022, and 2021, we recorded $2 related to the cash dividend payable to Valent on the Series A Preferred Stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.
Comparison of the six months ended December 31, 2022, and December 31, 2021
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Six months ended |
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December 31, |
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December 31, |
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Change $ |
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Change % |
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||||
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|
(in thousands) |
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||||||||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Research and development |
|
|
5,230 |
|
|
|
7,695 |
|
|
|
(2,465 |
) |
|
|
(32 |
) |
General and administrative |
|
|
2,915 |
|
|
|
4,171 |
|
|
|
(1,256 |
) |
|
|
(30 |
) |
|
|
|
(8,145 |
) |
|
|
(11,866 |
) |
|
|
3,721 |
|
|
|
|
|
Other income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign exchange |
|
|
11 |
|
|
|
5 |
|
|
|
6 |
|
|
|
120 |
|
Interest, net |
|
|
84 |
|
|
|
2 |
|
|
|
82 |
|
|
|
4,100 |
|
|
|
|
95 |
|
|
|
7 |
|
|
|
88 |
|
|
|
|
|
Net loss |
|
|
(8,050 |
) |
|
|
(11,859 |
) |
|
|
3,809 |
|
|
|
|
|
Research and Development
Research and development expenses decreased to $5,230 for the six months ended December 31, 2022, from $7,695 for the six months ended December 31, 2021. The decrease was largely attributable to lower clinical development costs, non-cash, share-based compensation expenses, and personnel costs incurred during the six months ended December 31, 2022, compared to the six months ended December 31, 2021.
Clinical development costs have decreased in the six months ended December 31, 2022, compared to the six months ended December 31, 2021, partially due to lower costs recognized for the GBM AGILE Study. In addition, on October 19, 2022, we announced we had paused the REM-001 program in order to preserve cash for the development of VAL-083. As a result, costs for REM-001 were lower in the six months ended December 31, 2022, compared to the same period in the prior fiscal year. Non-cash, share-based compensation expense decreased to $274 for the six months ended December 31, 2022, from $493 for the six months ended December 31, 2021, due to the higher compensation expense recognized during the six months ended December 31, 2021, for stock options granted in September 2021. Personnel costs have decreased in the current period compared to the same period in the prior fiscal year largely due to a reduction in staff.
General and Administrative
27
General and administrative expenses were $2,915 for the six months ended December 31, 2022, compared to $4,171 for the six months ended December 31, 2021. A significant portion of the decrease was a result of lower non-cash, share-based compensation expenses, professional fees, and a reduction in personnel in the current six months compared to the same period in the prior fiscal year. Non-cash, share-based compensation expense decreased to $680 for the six months ended December 31, 2022, from $1,148 for the six months ended December 31, 2021, due to the recognition of higher compensation expense recognized during the six months ended December 31, 2021, for stock options granted in September 2021. Personnel costs have decreased in the current period compared to the same period in the prior fiscal year largely due to a reduction in staff. Professional fees were lower during the six months ended December 31, 2022, compared to the six months ended December 31, 2021, due to reduced investor relations expenses.
Preferred Share Dividends
During the six months ended December 31, 2022, we issued 43 (2021 – 34) shares of common stock as a stock dividend on the Series C Preferred Stock and recognized $362 (2021 - $2,462) as a direct increase in accumulated deficit.
For each of the six months ended December 31, 2022, and 2021, we recorded $4 related to the cash dividend payable to Valent on the Series A Preferred Stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.
Liquidity and Capital Resources
Six months ended December 31, 2022, compared to the six months ended December 31, 2021
|
|
December 31, |
|
|
December 31, |
|
|
Change |
|
|
Change |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Cash flows from operating activities |
|
|
(8,530 |
) |
|
|
(10,177 |
) |
|
|
1,647 |
|
|
|
(16 |
) |
Cash flows from investing activities |
|
|
(232 |
) |
|
|
— |
|
|
|
(232 |
) |
|
|
100 |
|
Cash flows from financing activities |
|
|
1,856 |
|
|
|
13,704 |
|
|
|
(11,848 |
) |
|
|
(86 |
) |
Operating Activities
Net cash used in operating activities decreased to $8,530 for the six months ended December 31, 2022, from $10,177 for the six months ended December 31, 2021. During the six months ended December 31, 2022, and 2021, we reported net losses of $8,050 and $11,859, respectively. Changes in adjustments to reconcile net loss to net cash used in operating activities for the six months ended December 31, 2022, included stock option expense of $909 being recognized during the current period compared to $1,641 in the same period in the prior fiscal year. The most significant changes in working capital for the six months ended December 31, 2022, were related to an increase in clinical trial deposits of $1,700 and a decrease in accounts payable and accrued liabilities of $535. The most significant change in working capital for the six months ended December 31, 2021, was due to a decrease in prepaid expenses and deposits of $678 and an increase in accounts and accrued liabilities of $676.
Investing Activities
Net cash used in investing activities was $232 for the six months ended December 31, 2022, for the purchase of equipment, compared to $nil for the six months ended December 31, 2021.
Financing Activities
During the six months ended December 31, 2022, we received $1,860 in net proceeds from the sale of shares under the Purchase Agreement with Lincoln Park.
During the six months ended December 31, 2021, we received $13,634 in net proceeds from the completion of a registered direct financing that closed on September 28, 2021, and $74 from the cash exercise of stock purchase warrants.
Going Concern and Capital Expenditure Requirements
Going Concern and Management Plans
(See note 1 to the condensed consolidated interim financial statements)
The condensed consolidated interim financial statements have been prepared on a going concern basis, which assumes that we will continue our operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the normal course of business.
28
For the six months ended December 31, 2022, we reported a loss of $8,050 and a negative cash flow from operations of $8,530. We had an accumulated deficit of $144,772 and had cash and cash equivalents of $4,874 as of December 31, 2022. We are in the clinical stage and have not generated any revenues to date. We do not have the prospect of achieving revenues until such time that our product candidates are commercialized, or partnered, which may not ever occur. On August 2, 2022, we entered into a stock purchase agreement under which we received approximately $1,860 in net proceeds as of December 31, 2022, which is the current maximum amount available under the stock purchase agreement due to ownership limitations under Nasdaq rules. Even with the proceeds from this financing, we will require additional funding to maintain our clinical trials, research and development projects, and for general operations. These circumstances indicate substantial doubt exists about our ability to continue as a going concern within one year from the date of filing of these condensed consolidated interim financial statements.
Consequently, management is pursuing various financing alternatives to fund our operations so we can continue as a going concern. In addition, we have paused the REM-001 program in order to conserve cash resources for the VAL-083 clinical study. Management plans to continue to pursue opportunities to secure the necessary financing through the issue of new equity, debt, and/or entering into strategic partnership arrangements. However, our ability to raise additional capital could be affected by various risks and uncertainties including, but not limited to, the effects of the COVID-19 pandemic and global unrest. We may not be able to raise sufficient additional capital and may tailor our drug candidate development programs based on the amount of funding we are able to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.
The condensed consolidated interim financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern. Such adjustments could be material.
Our future funding requirements will depend on many factors, including but not limited to:
the rate of progress and cost of our clinical studies, preclinical studies and other discovery and research and development activities;
the costs associated with establishing manufacturing and commercialization capabilities;
the costs of acquiring or investing in businesses, product candidates and technologies;
the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights;
the costs and timing of seeking and obtaining FDA and other regulatory approvals;
the effect of competing technological and market developments;
the economic and other terms and timing of any collaboration, licensing or other arrangements into which we may enter; and
the impact of us being a public entity.
Until we can generate a sufficient amount of product revenue to finance our cash requirements, which we may never do, we expect to finance future cash needs primarily through public or private equity and debt offerings, and/or strategic collaborations. The sale of equity and convertible debt securities may result in dilution to our stockholders and certain of those securities may have rights senior to those of our shares of capital stock. If we raise additional funds through the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain covenants that would restrict our operations. Any other third-party funding arrangement could require us to relinquish valuable rights. Economic conditions may affect the availability of funds and activity in equity markets. We do not know whether additional funding will be available on acceptable terms, or at all. If we are not able to secure additional funding when needed, we may have to delay, reduce the scope of or eliminate one or more of our clinical trials or research and development programs or make changes to our operating plan. In addition, we may have to seek a partner for one or more of our product candidates at an earlier stage of development, which would lower the economic value of those programs to us.
Critical Accounting Policies and Estimates
The preparation of financial statements, in conformity with generally accepted accounting principles in the United States, requires companies to establish accounting policies and to make estimates that affect both the amount and timing of the recording of assets, liabilities, revenues and expenses. Some of these estimates require judgments about matters that are inherently uncertain and therefore actual results may differ from those estimates.
29
A detailed presentation of all of our significant accounting policies and the estimates derived therefrom is included in Note 2 to our consolidated financial statements for the year ended June 30, 2022 contained in our Form 10-K filed with the SEC on September 27, 2022. While all of the significant accounting policies are important to our consolidated financial statements, the following accounting policies and the estimates derived therefrom are critical:
Fair value of financial instruments
Accruals for research and development expenses and clinical trials
Fair value of financial instruments
We recognize compensation costs resulting from the issuance of stock-based awards to employees, non-employees and directors as an expense in the statement of operations over the service period based on a measurement of fair value for each stock-based award. Prior to our adoption of ASU 2018-07, Compensation-Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), stock options granted to non-employee consultants were revalued at the end of each reporting period until vested using the Black-Scholes option-pricing model and the changes in their fair value were recorded as adjustments to expense over the related vesting period. For the six months ended December 31, 2022, and 2021, the determination of grant-date fair value for stock option awards was estimated using the Black-Scholes model which includes variables such as the expected volatility of our share price, the anticipated exercise behavior of its grantee, interest rates, and dividend yields. For the six months ended December 31, 2022, and 2021, we utilized the plain vanilla method to determine the expected life of stock options. These variables are projected based on our historical data, experience, and other factors. Changes in any of these variables could result in material adjustments to the expense recognized for share-based payments. Such value is recognized as expense over the requisite service period, net of actual forfeitures, using the accelerated attribution method. We recognize forfeitures as they occur. The estimation of stock awards that will ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ from current estimates, such amounts are recorded as a cumulative adjustment in the period estimates are revised.
We have issued warrants for services provided by non-employees. The warrants issued for services have been valued at the fair value of the warrants issued. For the six months ended December 31, 2022, and 2021, the determination of grant-date fair value for warrants issued for services was estimated using the Black-Scholes model which includes variables such as the expected volatility of our share price, interest rates, dividend yields, and the term of the warrant. We have also issued shares for services to non-employees which have been valued using the share price of our common stock.
Accruals for research and development expenses and clinical trials
As part of the process of preparing our financial statements, we are required to estimate our expenses resulting from our obligations under contracts with vendors, clinical research organizations and consultants, and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment terms that do not match the periods over which materials or services are provided under such contracts. Our objective is to reflect the appropriate expenses in our financial statements by matching those expenses with the period in which services are performed and efforts are expended. We account for these expenses according to the timing of various aspects of the expenses. We determine accrual estimates by taking into account discussion with applicable personnel and outside service providers as to the progress of clinical trials, or the services completed. During the course of a clinical trial, we adjust our clinical expense recognition if actual results differ from our estimates. We make estimates of our accrued expenses as of each balance sheet date based on the facts and circumstances known to us at that time. Our clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third-party vendors. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in us reporting amounts that are too high or too low for any particular period. For six months ended December 31, 2022, and 2021, there were no material adjustments to our prior period estimates of accrued expenses for clinical trials.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
30
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not required for a smaller reporting company.
Item 4. Controls and Procedures.
(a) Evaluation of Disclosure Controls and Procedures. Our principal executive officer and principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Form 10-Q, have concluded that, based on such evaluation, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
(b) Changes in Internal Controls. There were no changes in our internal control over financial reporting, identified in connection with the evaluation of such internal control that occurred during the quarter ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
31
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
There are no legal proceedings the Company is party to or any of its property is subject to.
Item 1A. Risk Factors.
There were no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on September 27, 2022.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None
32
Item 6. Exhibits.
3.1 |
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3.2 |
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31.1 |
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31.2 |
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32.1 |
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32.2 |
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EX-101.INS |
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Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document* |
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EX-101.SCH |
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Inline XBRL Taxonomy Extension Schema Document* |
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EX-101.CAL |
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Inline XBRL Taxonomy Extension Calculation Linkbase Document* |
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EX-101.DEF |
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Inline XBRL Taxonomy Extension Definition Linkbase Document* |
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EX-101.LAB |
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Inline XBRL Taxonomy Extension Label Linkbase Document* |
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EX-101.PRE |
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Inline XBRL Taxonomy Extension Presentation Linkbase Document* |
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104 Cover Page Interactive Data File (embedded within the Inline XBRL document) |
||
* Filed herewith
** The certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.
33
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Kintara Therapeutics, Inc. |
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|
|
Date: February 14, 2023 |
By: |
/s/ Robert E. Hoffman |
|
|
Robert E. Hoffman |
|
|
Chief Executive Officer (Principal Executive Officer) |
Date: February 14, 2023 |
By: |
/s/ Scott Praill |
|
|
Scott Praill |
|
|
Chief Financial Officer (Principal Financial and Accounting Officer) |
34
Exhibit 31.1
CERTIFICATION PURSUANT TO
RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Robert E. Hoffman, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Kintara Therapeutics, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: February 14, 2023 |
|
By: |
/s/ Robert E. Hoffman |
|
|
|
Robert E. Hoffman |
|
|
|
Chief Executive Officer (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION PURSUANT TO
RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Scott Praill, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Kintara Therapeutics, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: February 14, 2023 |
|
By: |
/s/ Scott Praill |
|
|
|
Scott Praill |
|
|
|
Chief Financial Officer (Principal Financial and Accounting Officer) |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Kintara Therapeutics, Inc. (the “Company”) on Form 10-Q for the period ended December 31, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert E. Hoffman, Chief Executive Officer of the Company, certify to my knowledge and in my capacity, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: February 14, 2023 |
|
By: |
/s/ Robert E. Hoffman |
|
|
|
Robert E. Hoffman |
|
|
|
Chief Executive Officer (Principal Executive Officer) |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Kintara Therapeutics, Inc. (the “Company”) on Form 10-Q for the period ended December 31, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Scott Praill, Chief Financial Officer of the Company, certify to my knowledge and in my capacity, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: February 14, 2023 |
|
By: |
/s/ Scott Praill |
|
|
|
Scott Praill |
|
|
|
Chief Financial Officer (Principal Financial and Accounting Officer) |