On June 28, 2022 Aethlon Medical, Inc. (Nasdaq: AEMD), a medical technology company focused on developing products to diagnose and treat life and organ threatening infectious diseases, reported financial results for its fiscal year ended March 31, 2022 and provided an update on recent developments (Press release, Aethlon Medical, JUN 28, 2022, View Source [SID1234616346]).

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Company Updates

Aethlon Medical is continuing the research and clinical development of the Hemopurifier, a therapeutic blood filtration system that can bind and remove life-threatening viruses and harmful exosomes from blood. This action has potential applications in cancer, where cancer associated exosomes may promote immune suppression and metastasis, and in life-threatening infectious diseases, including removal of COVID-19 virus, associated variants, and related exosomes.

As disclosed previously, the Aethlon Hemopurifier has demonstrated binding of the SARS-CoV-2 spike protein and, as reported in a peer reviewed publication, the binding and removal from circulation of SARS-CoV-2 virus from a human patient. That publication also noted that the Hemopurifier has demonstrated the removal of exosomes and exosomal microRNAs associated with coagulopathy and acute lung injury.

We also recently published a pre-print manuscript demonstrating that Aethlon’s proprietary GNA affinity resin was able to bind seven clinically relevant SARS-CoV-2 variants in vitro, including the Delta and Omicron variants. Viral capture efficiency with the GNA affinity resin ranged from 53% to 89% for all variants tested. The GNA affinity resin is a key component of our Hemopurifier. The manuscript is titled "Removal of Clinically Relevant SARS-CoV-2 Variants by An Affinity Resin Containing Galanthus nivalis Agglutinin" and was published in bioRxiv.

We continued to advance our severe COVID-19 clinical trial for the Hemopurifier under our open Investigational Device Exemption (IDE) for life-threatening viral infections. In June 2022, the first patient in this study was enrolled and has completed the Hemopurifier treatment phase of the protocol. We now have nine fully activated hospitals that are actively screening patients for the trial, including Louisiana State University (LSU) Shreveport, Valley Baptist Medical Center in Texas, Loma Linda Medical Center, Hoag Irvine and Newport Beach in Southern California, University of California Davis, University of Miami Medical Center, Cooper Medical and Thomas Jefferson Medical Center. We are in the site activation process with additional U.S. medical centers. Our contract research organization (CRO) for this trial is Pharmaceutical Product Development, also known as PPD.

We also obtained ethics review board approval and entered into an agreement with Medanta Medicity Hospital, a multi-specialty hospital in Delhi NCR, India, to initiate a COVID-19 clinical trial. We have completed all site initiation activities and this site is now open for enrollment and is actively screening patients. One patient recently completed participation in the study.

In addition to our work with COVID-19, we continue to screen patients for our IDE clinical trial in head and neck cancer. We are working to increase the number of trial sites to accelerate patient recruitment and we are also considering initiating additional trials, both domestically and abroad, to investigate the Hemopurifier as a treatment for other forms of cancer.

Aethlon also recently announced the appointment of Angela Rossetti to the Aethlon Board of Directors, effective April 1, 2022. Ms. Rossetti is a senior biopharmaceutical executive who brings more than 20 years of industry experience.

Financial Results for the Fiscal Year Ended March 31, 2022

At March 31, 2022, Aethlon Medical had a cash balance of approximately $17.1 million.

Aethlon recorded approximately $294,000 of revenue related to our government contracts with the NIH in the fiscal year ended March 31, 2022, compared to approximately $659,000 in the fiscal year ended March 31, 2021. At March 31, 2022, the Company had approximately $345,000 of deferred revenue related to those contracts as a result of not achieving certain milestones in those contracts.

Consolidated operating expenses for the fiscal year ended March 31, 2022 were approximately $10.72 million, compared to approximately $8.55 million for the fiscal year ended March 31, 2021, an increase of approximately $2.17 million in fiscal year ended March 31, 2022. The $2.17 million increase in the 2022 period was due to increases in payroll and related expenses of approximately $1.17 million and in general and administrative expense of $1.0 million, which were partially offset by a decrease of approximately $4,000 in professional fees.

The $1.17 million increase in the fiscal year ended March 31, 2022 in payroll and related expenses was due to an increase in cash-based compensation of approximately $1.2 million, which was partially offset by a decrease in stock-based compensation of approximately $29,000. The $1.2 million increase in cash-based compensation was primarily due to increases of approximately $826,000 and $721,000 in general and administrative payroll and in research and development payroll, respectively, due to headcount increases, and approximately $203,000 in relocation-related compensation to two senior executives that relocated to San Diego, California as a condition of their employment. Those increases were partially offset by the combination of a $452,000 accrual in the 2021 period related to the separation agreement with the former CEO, with no comparable expense in the 2022 period, and a net decrease of approximately $135,000 in cash bonuses.

The $1.0 million increase in the fiscal year ended March 31, 2022 in general and administrative expenses primarily arose from increases of $453,000 in clinical trial expenses, $209,000 in rent expense and $195,000 in insurance expense

As a result of the changes in revenues and expenses noted above, Aethlon’s net loss before noncontrolling interests increased to approximately $10.4 million for the fiscal year ended March 31, 2022, from approximately $7.9 million for the fiscal year ended March 31, 2021.

The unaudited condensed consolidated balance sheet for March 31, 2022 and the unaudited condensed consolidated statements of operations for the fiscal years ended March 31, 2022 and 2021 follow at the end of this release.

Conference Call

The Company will hold a conference call today, Tuesday, June 28, 2022 at 4:30 p.m. Eastern Time to review financial results and recent corporate developments. Following management’s formal remarks, there will be a question and answer session.

Interested parties can register for the conference by navigating to View Source

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 July 28, 2022. 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 4234353.