On February 14, 2024 Aethlon Medical, Inc. (Nasdaq: AEMD), a medical therapeutic company focused on developing products to treat cancer and life-threatening infectious diseases, reported financial results for its fiscal third quarter ended December 31, 2023 and provided an update on recent developments (Press release, Aethlon Medical, FEB 14, 2024, View Source [SID1234640108]).
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Company Updates
Aethlon Medical is continuing the research and clinical development of its Hemopurifier, a therapeutic blood filtration system designed to bind and remove harmful exosomes and life-threatening viruses from blood and other biological fluids. These qualities of the Hemopurifier have potential applications in oncology, where cancer associated exosomes may promote immune suppression and metastasis, and in life-threatening infectious diseases. Aethlon is also investigating the use of the Hemopurifier in the organ transplant setting, initially focusing on the potential removal of viruses and exosomes with harmful cargo from recovered kidneys.
In October 2023, Aethlon received clearance from the Drug Controller General of India (DCGI), the country’s central drug authority, to conduct a phase 1 safety, feasibility and dose-finding trial of the Hemopurifier in patients with solid tumors who have stable or progressive disease during anti-PD-1 monotherapy treatment, such as Keytruda or Opdivo. The trial is expected to begin following completion of an in vitro binding study of relevant targets, and subsequent approval by the respective Ethics Boards of interested sites in India.
"In addition to an interested initial site in India, we have two interested sites in Australia that are also awaiting the data from our in vitro binding study," stated James Frakes, Interim Chief Executive Officer and Chief Financial Officer. "Our in vitro binding study of relevant oncology targets is complex and stands on the cutting edge of extracellular vesicle science. Our goal is to quantify the potential impact of our Hemopurifier on plasma from cancer patients that have been treated with anti-PD-1 monotherapy treatment in order to provide pre-clinical evidence to support our trial design.
"While our research and development team has started to quantify our internal data, the results, to date, are inconclusive. Therefore, while our internal team continues to finetune their work, in parallel we have engaged several third-party laboratories to independently perform assays on the samples.
"We are also maintaining a position in the use of our Hemopurifier as a treatment against life-threatening viral infections through our COVID-19 trial in India. We have two participating sites for this trial — the Medanta Medicity Hospital and Maulana Azad Medical College, or MAMC. One patient has been treated thus far, however, we have been informed by our contract research organization that a new COVID-19 subvariant was recently detected in India. Our COVID-19 trial in India remains open in the event that there are COVID-19 admissions to the intensive care units at our two participating sites.
"Finally, since being named interim Chief Executive Officer three months ago, I have focused our efforts on our oncology program, as well as on reducing our expenses. As previously reported, we disclosed some interesting pre-clinical proof on concept data of the Hemopurifier in organ transplantation. As a result, we plan to submit one or more articles for publication on our pre-clinical data," concluded Mr. Frakes.
Financial Results for the Third Quarter Ended December 31, 2023
As of December 31, 2023, Aethlon Medical had a cash balance of approximately $8.0 million.
Consolidated operating expenses for the three months ended December 31, 2023 were approximately $3.6 million, compared to $2.8 million for the three months ended December 31, 2022. This increase of approximately $717,000, or 25.2%, in the 2023 period was due to increase in payroll and related expenses of approximately $871,000, offset by decreases in general and administrative expenses of approximately $92,000 and in professional fees of approximately $61,000.
The $871,000 increase in payroll and related expenses was primarily due to separation expenses for our former chief executive officer of $873,000 and an increase in salary expense of $81,000 associated with an increase in average headcount, offset by a decrease in stock-based compensation of $83,000.
The $92,000 decrease in general and administrative expenses was primarily due to a decrease in clinical trial expense of approximately $399,000 and a $33,000 decrease in travel and conferences expenses. Decreases were offset by a $284,000 increase in supplies for manufacturing and research and development expense, a $31,000 increase in insurance expense, a $13,000 increase in depreciation expense and a $12,000 increase in outside services and repairs. The increase in insurance expense included $16,000 of health insurance related to the separation agreement with our former chief executive officer.
The $61,000 decrease in professional fees was due to a $54,000 decrease in scientific consulting, a $22,000 decrease in marketing, a $21,000 decrease in recruiting and a net $33,000 decrease in contract labor related to general research and development. These decreases were offset by an increase of $44,000 in legal expenses relating to the reverse stock split, an $11,000 increase in director fees associated with the addition of a new director and a $14,000 increase in investor relations and accounting fees.
As a result of the changes in expenses noted above, the company’s net loss increased to $3.6 million for the three months ended December 31, 2023, from $2.8 million in the three months ended December 31, 2022.
The condensed consolidated balance sheet for December 31, 2023, and the condensed consolidated statements of operations for the three- and nine-month periods ended December 31, 2023 and 2022 follow at the end of this release.
Conference Call
Aethlon Medical will hold a conference call today, Wednesday, February 14, 2023, at 4:30 p.m. ET to review its financial results for its fiscal third quarter ended December 31, 2023 and recent corporate developments. Interested parties can register for the conference by navigating to View Source Please note that registered participants will receive their dial-in number upon registration.
Interested parties without internet access or who are unable to pre-register, may dial in as follows:
Participant Dial In (Toll Free): 1-844-836-8741
Participant International Dial In: 1-412-317-5442
All callers should ask for the Aethlon Medical, Inc. conference call.
A replay of the call will be available approximately one hour after the end of the call through March 14, 2024. The replay can be accessed via Aethlon Medical’s website or by dialing 1-877-344-7529 (domestic) or 1-412-317-0088 (international) or Canada toll free at 1-855-669-9658. The replay conference ID number is 7691190.