UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Item 2.02 Results of Operations and Financial Condition.
On November 8, 2022, Processa Pharmaceuticals, Inc. (the “Company”) issued an earnings release announcing its financial results for the quarter ended September 30, 2022. A copy of the earnings release is furnished as Exhibit 99.1 to this Current Report on Form 8-K (this “Report”).
The information in this Item 2.02 and Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any of the Company’s filings under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.
Item 7.01 Regulation FD Disclosure.
Results of PCS 12852 Phase 2A Trial
On November 8, 2022, the Company issued a press release announcing positive gastric emptying results from its PCS12852 Phase 2A trial in patients with moderate to severe gastroparesis. A copy of the press release is furnished as Exhibit 99.2 to this Report.
Corporate Presentation
On November 8, 2022, the Company posted an updated corporate presentation to its website at https://www.processapharmaceuticals.com/, which the Company may use from time to time in communications or conferences. A copy of the corporate presentation is attached as Exhibit 99.3 to this Report.
The information in this Item 7.01 and Exhibits 99.2 and 99.3 shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Exhibit 99.3 hereto contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are based on current expectations and are not guarantees of future performance. Further, the forward-looking statements are subject to the limitations listed in Exhibit 99.3 and in the other reports of the Company filed with the Securities and Exchange Commission, including that actual events or results may differ materially from those in the forward-looking statements.
Item 9.01. Financial Statements and Exhibits.
| Exhibit No. | Exhibit Description | |
| 99.1 | Earnings release, dated November 8, 2022 announcing Processa Pharmaceuticals, Inc. financial results for the quarter ended September 30, 2022 | |
| 99.2 | Press release, dated November 8, 2022 announcing results from its PCS12852 Phase 2A trial | |
| 99.3 | Corporate Presentation, dated November 8, 2022 | |
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL documents) |
SIGNATURE
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, hereunto duly authorized, on November 8, 2022.
| PROCESSA PHARMACEUTICALS, INC. | ||
| Registrant | ||
| By: | /s/ David Young | |
| David Young | ||
| Chief Executive Officer | ||
Exhibit 99.1
Processa Pharmaceuticals Announces Third Quarter Financial Results and Provides Corporate Update
| ● | PCS12852 successfully demonstrates a positive effect on the gastric emptying rate, clearing the path for a Phase 2B trial in 2023. | |
| ● | Next Generation Capecitabine (a combination of PCS6422 and capecitabine) successfully identifies dosing regimens for a Phase 2B trial to be initiated in 2023 after a meeting with FDA to discuss the alignment of the trial design with the FDA’s Project Optimus Oncology Initiative. |
HANOVER, Md., Nov. 8, 2022 (GLOBE NEWSWIRE) — Processa Pharmaceuticals, Inc. (Nasdaq: PCSA) (“Processa” or the “Company”), a diversified clinical-stage company developing drugs for patients who have unmet medical conditions and/or require better treatment options to improve a patient’s survival and/or quality of life, today announced financial results for the quarter ended September 30, 2022, and provided an update on its clinical programs.
Dr. David Young, President and CEO of Processa, commented, “We are delighted to report our push to enroll patients in PCS12852 (Gastroparesis) and PCS6422 (Next Generation Capecitabine) has helped us get critical data and report successful preliminary results in both trials. The data from these trials will help us design Phase 2B trials for both programs.
| ● | Next Generation Capecitabine (NGC) (a combination of PCS6422 and capecitabine): we have identified lower capecitabine dosage regimens when administered in NGC that will help avoid dose-limiting toxicities such as hand-foot syndrome, yet provide approximately 50-times greater potency than capecitabine alone. We will complete this study in the near future and seek FDA confirmation of our plans to implement the principles of the Project Optimus Oncology Initiative, wherein the objective is to optimize dosing to achieve a better balance between efficacy and safety than merely using the maximum tolerated dose. | |
| ● | PCS12852: we have shown a statistical difference in the gastric emptying rate between the 6 patients on 0.5 mg of PCS12852 and the 8 patients on placebo at p-value < 0.10 with mild to moderate adverse events. We anticipate having the analysis of the gastroparesis symptoms completed by the end of the year. |
All our energies have been directed towards the completion of these trials that inform the next steps for these much-needed therapies.
Advancing these drugs in their respective clinical trial allows us to obtain the clinical data to better define each pivotal trial as well as provide us with more insight into how the FDA will review each of these products as we plan the road maps for designing the studies for our New Drug Applications to FDA.
Financial Results for the Nine Months Ended September 30, 2022
Our cash balance on September 30, 2022, was $9.1 million, which should be sufficient to complete our three on-going clinical trials and fund our operations into the third quarter of 2023. During the nine months ended September 30, 2022, we spent $7.1 million in cash for these three clinical trials and in our operations. This is significantly less than our GAAP net loss of $14.4 million due to the effect of non-cash items like amortization and stock-based compensation, and the application of amounts we had prepaid to our CROs last year.
Our net loss for the nine months ended September 30, 2022, was $14.4 million or $0.90 per share compared to a net loss of $8.2 million, or $0.54 per share for the same period of 2021. The increase in our net loss relates primarily to increased clinical trial costs we incurred in our three ongoing trials. For the nine months ended September 30, 2022, we incurred $8.3 million in research and development costs, an increase of $3.5 million when compared to the same period of 2021. We anticipate clinical trial costs will continue to increase for the rest of the year as our trials continue to progress and we fund development activities for the other drugs in our pipeline.
During the nine months ending September 30, 2022, our general and administrative expenses totaled $6.1 million compared to $3.4 million for the same period in 2021. The increase related primarily to increases in non-cash or stock-based compensation costs, along with other operating and consulting costs. We allocated $6.1 million of non-cash compensation costs between our R&D and G&A costs, with the majority recorded as G&A.
Our net cash used in operating activities during the nine months ended September 30, 2022, increased by $1.1 million to $7.1 million, compared to $6 million for the same period in 2021. While we experienced increased GAAP costs related to our clinical trials and operations, we continued to make use of equity incentives to compensate our executive and development team, thereby reducing our cash outflow, and we were able to apply previously made advanced payments to our CROs against current trial costs.
As of September 30, 2022, we had 15.9 million common shares outstanding.
Conference Call Information
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Date: November 8, 2022
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About Processa Pharmaceuticals, Inc.
The mission of Processa is to develop products with existing clinical evidence of efficacy for patients with unmet or underserved medical conditions who need treatment options that improve survival and/or quality of life. The Company uses these criteria for selection to further develop its pipeline programs to achieve high-value milestones effectively and efficiently. Active clinical pipeline programs include Next Generation Capecitabine (formerly identified as PCS6422) for metastatic colorectal cancer and breast cancer, PCS499 (ulcerative necrobiosis lipoidica) and PCS12852 (GI motility/gastroparesis). The members of the Processa development team have been involved with more than 30 drug approvals by the FDA (including drug products targeted to orphan disease conditions) and more than 100 FDA meetings throughout their careers. For more information, visit the company’s website at www.processapharma.com.
Forward-Looking Statements
This release contains forward-looking statements. The statements in this press release that are not purely historical are forward-looking statements which involve risks and uncertainties. Actual future performance outcomes and results may differ materially from those expressed in forward-looking statements. Please refer to the documents filed by Processa Pharmaceuticals with the SEC, specifically the most recent reports on Forms 10-K and 10-Q, which identify important risk factors which could cause actual results to differ from those contained in the forward-looking statements.
For More Information:
Michael Floyd
(301)651-4256
Patrick Lin
(925) 683-3218
Exhibit 99.2
PCS12852 Improves Gastric Emptying in Gastroparesis Patients
| ● | In a Phase 2A Proof-of-Concept trial, the Gastric Emptying Breath Test (GEBT) results demonstrated statistical improvement in gastric emptying in gastroparesis patients receiving 0.5 mg of PCS12852 (6 patients) as compared to placebo (8 patients) at a p < 0.10 level. | |
| ● | Adverse events associated with this Phase 2A trial were mild to moderate with no clinically significant cardiovascular or serious adverse events. | |
| ● | Evaluation of the effect of PCS12852 on gastroparesis symptoms is expected before the end of this year. | |
| ● | Processa plans to initiate a Phase 2B trial in 2023. |
HANOVER, MD – November 8, 2022 — Processa Pharmaceuticals, Inc. (Nasdaq: PCSA), a diversified clinical-stage company developing products to improve survival and/or the quality of life for patients who have an unmet medical need condition, announces positive gastric emptying results from its PCS12852 Phase 2A trial in patients with moderate to severe gastroparesis. This Phase 2A trial was a 4-week placebo-controlled, randomized, dose-response trial designed to evaluate the effect of PCS12852 on gastric emptying, safety, pharmacokinetics, and gastroparesis symptoms. Two dosage regimens of PCS12852 versus placebo were evaluated in patients with moderate to severe gastroparesis.
PCS12852 is a novel, potent, and highly selective 5-hydroxytryptamine-4 (5-HT4) receptor agonist. While there are other 5-HT4 receptor agonists used to treat gastrointestinal (GI) motility disorders, these have less 5-HT4 selectivity and are associated with serious cardiovascular side effects due to the binding to other receptors. Although 2-5 million patients have moderate to severe chronic gastroparesis in the U.S., the only FDA-approved treatment options for gastroparesis have black box warnings and can only be used for 12 weeks due to adverse events.
In contrast, PCS12852 has been shown in normal healthy volunteers and constipation patients to increase GI function with no cardiovascular and no serious adverse effects. Adverse events associated with this Phase 2A trial were mild to moderate, occurring within the first few days after starting treatment, and quickly resolved without any sequelae. There were no clinically significant cardiovascular, unexpected, or serious adverse events (SAEs) reported during the study.
Since the gastric emptying rate in gastroparesis patients is known to be delayed, the gastric emptying rate in the Phase 2A study was assessed using the Cairn Diagnostic 13C Spirulina Gastric Emptying Breath Test (GEBT), which is an FDA-approved diagnostic tool used for measuring the rate of solid-phase gastric emptying and for identifying delayed gastric emptying. The gastric emptying rate half time (t50), as measured by the GEBT from baseline to Day 28, was calculated for each patient.
GEBT results from this small Phase 2A Proof-of-Concept study, which included a total of 14 patients in the 0.5 mg (6 patients) and placebo (8 patients) groups, demonstrated statistical improvement in gastric emptying in patients receiving 0.5 mg of PCS12852 as compared to placebo at a p < 0.10 level. The mean (±SD) t50 change from baseline was decreased for 0.5 mg PCS12852 compared with placebo by -31.90 ± 50.53 min vs -9.36 ±42.43 min, respectively. Differences were not observed between the placebo and the 0.1 mg dose.
“We are pleased that this first Phase 2A study with PCS12852 was able to demonstrate a prokinetic effect and improve gastric emptying in gastroparesis patients,” said Dr. Sian Bigora, Chief Development Officer at Processa. “The data from this study will inform the design of our planned Phase 2B study. Gastroparesis continues to be a serious disease that has unmet needs, and we are hopeful that PCS12852 will ultimately help improve the quality of life of gastroparesis patients.”
About Gastroparesis
Gastroparesis is a disorder characterized by delayed gastric emptying of solid food in the absence of mechanical obstruction, particularly pyloric stenosis. This delay may result in the cardinal symptoms of early satiety, postprandial fullness, nausea, vomiting, belching, bloating, and pain. Gastroparesis can be idiopathic, associated with diabetes mellitus, can occur after a medical intervention (iatrogenic or post-surgical), may be associated with neurological disorders, or may occur after a bacterial or viral infection. Although there have been advances in understanding the mechanisms and pathophysiology of gastroparesis, there are still significant gaps in knowledge, inconsistencies across studies, and potential differences between different etiological groups (e.g., diabetic versus idiopathic). Gastroparesis is associated with significantly lower survival. In addition to its effect on mortality, gastroparesis symptoms negatively impact the quality of life and day-to-day functioning of patients. With the limitation on currently approved treatments for gastroparesis, there still is a need for new, effective treatments for the millions of patients with this disorder
About Processa Pharmaceuticals, Inc.
The mission of Processa is to develop products with existing clinical evidence of efficacy for patients with unmet or underserved medical conditions who need treatment options that improve survival and/or quality of life. The Company uses its Regulatory Science Approach criteria when selecting drugs for development in order to achieve high-value milestones effectively and efficiently. Active clinical pipeline programs include: PCS6422 (metastatic colorectal cancer, breast cancer), PCS12852 (gastroparesis, functional constipation), and PCS499 (ulcerative necrobiosis lipoidica). Members of the Processa development team have been involved with more than 30 approvals for indications in almost every division of the FDA (including drug products targeted to orphan disease conditions) and more than 100 FDA meetings throughout their careers. For more information, visit our website at www.processapharma.com.
Forward-Looking Statements
This release contains forward-looking statements. The statements in this press release that are not purely historical are forward-looking statements that involve risks and uncertainties. Actual future performance outcomes and results may differ materially from those expressed in forward-looking statements. Please refer to the documents filed by Processa Pharmaceuticals with the SEC, specifically the most recent reports on Forms 10-K and 10-Q, which identify important risk factors which could cause actual results to differ from those contained in the forward-looking statements.
For More Information:
Michael Floyd
(301) 651-4256
Patrick Lin
(925) 683-3218
Exhibit 99.3