On June 11, 2019 Helix BioPharma Corp. (TSX: HBP) ("Helix" or the "Company"), a clinical stage immuno-oncology company developing innovative drug candidates for the prevention and treatment of cancer, reported its financial results for its fiscal third quarter ended April 30, 2019 (Press release, Helix BioPharma, JUN 11, 2019, View Source [SID1234537432]).
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FINANCIAL REVIEW
The Company recorded a net loss and total comprehensive loss of $2,071,000 ($0.02 loss per common share) and $2,147,000 ($0.02 loss per common share) for the three-month periods ended April 30, 2019 and 2018, respectively. For the nine-month periods ended April 30, 2019 and 2018, respectively, the Company recorded a net loss and total comprehensive loss of $5,358,000 ($0.05 loss per common share) and $7,015,000 ($0.07 loss per common share).
Research and development
Research and development costs for the three and nine-month periods ended April 30, 2019 totalled $1,351,000 and $3,695,000, respectively ($1,435,000 and $5,095,000 respectively for the three and nine-month periods ended April 30, 2018).
L-DOS47 research and development expenses for the three and nine-month periods ended April 30, 2019 totalled $1,054,000 and $2,703,000, respectively ($1,029,000 and $4,039,000 respectively for the three and nine-month periods ended April 30, 2018). L-DOS47 research and development expenditures relate primarily to the Company’s LDOS001 Phase I clinical study in the U.S., and LDOS003 Phase II clinical study in Poland, Ukraine and Hungary.
The Company’s LDOS001 clinical study continues to face patient enrolment challenges. An accelerated dosing protocol has been approved to help accelerate the LDOS001 clinical study. The Company continues to be committed to the LDOS001 study and has re-allocated limited resources to improve patient enrollment. Enrolment in the Company’s LDOS002 clinical study was previously halted at the end of stage 1 of a two-stage phase II study as the intensified schedule did not result in improving patient benefits compared to that observed in the Phase I portion of the study. The Company’s LDOS003 clinical study recently dosed its third patient and commenced second cohort enrollment. The Company is very close to finalizing a clinical study protocol for a Phase I/II study with L-DOS47 to be given in combination with doxorubicin, for the treatment of metastatic pancreatic cancer. The Company expects to file an investigational new drug application with the U.S. Food and Drug Administration for a study by the end of the month.
The Company’s Polish subsidiary continues to focus its activities on the V-DOS47 pre-clinical program. V-DOS47 research and development expenses for the three and nine-month periods ended April 30, 2019 totalled $137,000 and $369,000, respectively ($133,000 and $310,000 respectively for the three and nine-month periods ended April 30, 2018). For the three and nine-month periods ended April 30, 2019 the Company’s Polish subsidiary received grant funding of $130,000 and $352,000, respectively ($144,000 and $344,000 respectively for the three and nine-month periods ended April 30, 2018). Grant funding for the V-DOS4 program is the result of an agreement entered into with the Polish National Centre for Research and Development ("PNCRD"). The Agreement may be terminated by either party upon one month’s written notice and must also state the grounds for which the Agreement is being terminated. In certain cases of termination, the Company’s Polish subsidiary may be obligated to return the received financial support in full within fourteen days of the day notice is served, with interest. As at April 30, 2019 that Company’s Polish subsidiary has received grant funds of approximately PLN3,634,609 or 28% of the entire grant funding amount approved by the PNCRD.
CAR-T research and development expenses for the three and nine-month periods ended April 30, 2019 totalled $nil and $333,000 respectively ($192,000 and $317,000 respectively for the three and nine-month periods ended April 30, 2018). The Company commenced development of novel CAR-T therapeutics and new antibody-based technologies for cell-based therapies. The Company’s CAR-T expenditures relate primarily to collaborative research activities with ProMab Biotechnologies Inc.
Trademark and patent related expenses for the three and nine-month periods ended April 30, 2019 totalled $109,000 and $177,000, respectively ($70,000 and $308,000 respectively for the three and nine-month periods ended April 30, 2019). The Company continues to ensure it adequately protects its intellectual property.
Operating, general and administration
Operating, general and administration expenses for the three and nine-month periods ended April 30, 2019 and 2018 totalled $699,000 and $1,605,000, respectively ($686,000 and $1,856,000 respectively for the three and nine-month periods ended April 30, 2018). The decrease in operating, general and administration expenses mainly reflects the normalization of expenditures after companywide cost cutting initiatives.
The following table outlines operating, general and administration costs expensed for the following periods:
LIQUIDITY AND CAPITAL RESOURCES
The Company recorded a net loss and total comprehensive loss of $2,071,000 ($0.02 loss per common share) and $2,147,000 ($0.02 loss per common share) for the three-month periods ended April 30, 2019 and 2018, respectively. For the nine-month periods ended April 30, 2019 and 2018, respectively, the Company recorded a net loss and total comprehensive loss of $5,358,000 ($0.05 loss per common share) and $7,015,000 ($0.07 loss per common share), respectively.
As at April 30, 2019 the Company had a working capital deficiency of $2,203,000, shareholders’ deficiency of $1,920,000 and a deficit of $169,363,000. As at July 31, 2018 the Company had a working capital deficiency of $1,901,000, shareholders’ deficiency of $1,527,000 and a deficit of $164,005,000.
The Company continues to work with vendors to manage its cash position while ensuring vendors continue providing services while being paid, albeit over a longer period of time than previously agreed terms. Some vendors have placed the Company on hold (cash in advance) and is impacting the Company’s clinical development program. The Company has raised gross proceeds of approximately $8,518,000 from private placement financings during fiscal 2018 and an additional $6,014,000 during the nine-month period ended April 30, 2019. Subsequent to the April 30, 2019 quarter end, the Company announced the closing of a private placement on May 29th, 2019 for gross proceeds of $507,960. Nevertheless, the Company’s cash reserves of $938,000 as at April 30, 2019 continue to be insufficient to meet anticipated cash needs for working capital and capital expenditures through the next twelve months, nor are they sufficient to see the current or any planned research and development initiatives through to completion. Though the funds raised have somewhat assisted the Company in dealing with its working capital deficiency and attempts to make vendors current, additional funds are required to advance the various clinical and preclinical programs, pay for the Company’s overhead costs and its past due vendors. To the extent that the Company does not believe it has sufficient liquidity to meet its current obligations, management considers securing additional funds, primarily through the issuance of equity securities of the Company, to be critical for its development needs.
Additional information can be found about the Company’s liquidity and capital resources in the Company’s Management Discussion and Analysis.
The Company’s condensed unaudited interim consolidated statement of net loss and comprehensive loss for the three and nine-month periods ending April 30, 2019 and 2018 and the condensed unaudited interim consolidated statement of cash flows for the nine-month periods ending April 30, 2019 and 2018 are summarized below:
The Company’s condensed unaudited interim consolidated financial statements and management’s discussion and analysis will be filed under the Company’s profile on SEDAR at www.sedar.com, as well as on the Company’s website.
