On March 27, 2020 Can-Fite BioPharma Ltd. (NYSE American: CANF) (TASE:CFBI), a biotechnology company advancing a pipeline of proprietary small molecule drugs that address cancer, liver and inflammatory diseases, reported financial results for the year ended December 31, 2019 (Press release, Can-Fite BioPharma, MAR 27, 2020, View Source [SID1234555950]).
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Clinical Developments and Corporate Highlights Include:
Piclidenoson as Potential Treatment for Coronavirus – Piclidenoson’s anti-rheumatic and anti-viral effects, combined with its excellent safety profile, make it a potential candidate for the treatment of coronavirus. Can-Fite recently submitted Piclidenoson to the Institutional Review Board at Rabin Medical Center for a compassionate use program to treat coronavirus patients. If approved, the compassionate use program will be led by Dr. Dror Diker, M.D., Head of Internal Medicine D at the Rabin Medical Center. Concurrently, through a collaborative research agreement with the Lewis Katz School of Medicine at Temple University in Philadelphia, Can-Fite is conducting studies on the anti-viral activity of Piclidenoson on the coronavirus. The anti-viral effect of Piclidenoson is protected by US patent US7589075. Rheumatoid arthritis drugs are now being evaluated for the treatment of coronavirus in global studies, and China recently approved the use of Roche’s Actemra, a rheumatoid arthritis drug, to treat coronavirus.
Namodenoson Phase II NASH Data Expected in April 2020 – Can-Fite completed enrollment of 60 patients with NAFLD (non-alcoholic fatty liver disease) with or without NASH (non-alcoholic steatohepatitis), and plans to announce topline results during April 2020. The end points of this study include serum ALT levels, percentage change in liver fat, as measured by PDFF (proton density fat fraction), weight loss and additional serum parameters.
Namodenoson is Headed into Pivotal Phase III Liver Cancer Study – Following a successful End-of-Phase II Meeting with the U.S. Food and Drug Administration (FDA) regarding Namodenoson in the treatment of hepatocellular carcinoma (HCC), the most common form of liver cancer, the FDA agreed with Can-Fite’s proposed pivotal Phase III trial design to support a New Drug Application submission and approval. The Phase III study protocol and registration plan have also been submitted to the European Medicines Agency (EMA). Namodenoson is currently being used to treat liver cancer patients in a compassionate use program in Israel, which has enrolled seven patients. In addition, two patients who were enrolled in the Company’s former Phase II study, who responded well to the drug, are continuing treatment. Those two advanced liver cancer patients have reached an overall survival of over 2.5 years while being treated with Namodenoson.
Piclidenoson Phase III Rheumatoid Arthritis and Psoriasis Studies Complete 50% Enrollment; Interim Data for Rheumatoid Arthritis Expected Q4 2020 – Can-Fite continues to enroll patients in its Phase IIII study for psoriasis. An interim analysis is being implemented for the rheumatoid arthritis study. Data will be monitored by an independent data monitoring committee (IDMC) which will have un-blinded access to the data in Q3 2020, with an announcement of interim results expected in Q4 2020.
Developing Cannabinoid-based Drug Candidates – During 2019, Can-Fite signed an agreement with Univo Pharmaceuticals (TASE:UNVO), a medical cannabis company, to identify and co-develop specific formulations of cannabis components for the treatment of diseases in which there is an overexpression of A3AR, Can-Fite’s target. Based on its recent scientific findings, Can-Fite has filed patents for the use of cannabinoid-based drugs to treat cancer, autoimmune, inflammatory and metabolic diseases. The Company’s most recent research revealed that cannabis-derived CBD enriched fractions inhibit fat cell expansion and have beneficial effects against liver cancer.
Cash Infusion of $11 Million from Distribution Deals and Equity Raise – During 2019, Can-Fite raised a total of $9.2 million through equity offerings, and received upfront payments from distribution agreements for its drugs in specific territories and indications in the amount of $1.75 million. The upfront payments from distributors were part of agreements that totaled $10 million plus royalties based on the achievement of milestones. Following the end of 2019, Can-Fite received an additional cash infusion of $8.4 million through a combination of $5 million raised through an equity offering and $3.4 million through cash exercises of warrants.
"We are focused on delivering our advanced stage drug candidates to meet the immediate medical needs of patients who lack safe and effective treatments to life threatening conditions. This includes Piclidenoson for the treatment of coronavirus and Namodenoson for advanced liver cancer," stated Can-Fite CEO Pnina Fishman. "In 2019, we achieved very significant progress in our Phase III trials of Piclidenoson and are now over 50% complete with patient enrollment. In 2020, we are well positioned for achieving milestones which we believe may generate more non-dilutive funding for Can-Fite through new global distribution agreements, as well as trigger milestone payments from our current agreements."
Financial Results
Revenues for the year ended December 31, 2019 were $2.0 million, a decrease of $1.8 million, or 47.3%, compared to $3.8 million for the year ended December 31, 2018. The decrease in revenue was mainly due to the recognition of a $2 million advance payment received in August 2018 under the License, Collaboration and Distribution Agreement with CMS Medical.
Research and development expenses for the year ended December 31, 2019 were $10.9 million, an increase of $4.9 million, or 81.6%, compared to $6 million for the year ended December 31, 2018. Research and developments expenses for the year ended 2019 comprised primarily of expenses associated with the Phase II studies for Namodenoson and Phase III studies of Piclidenoson. The increase is primarily due to increased costs associated with the initiation of the Phase III clinical trial of Piclidenoson for the treatment of rheumatoid arthritis. We expect that the research and development expenses will increase through 2020 and beyond.
General and administrative expenses were $3.0 million for the year ended December 31, 2019 a decrease of $0.1 million, or 3.1%, compared to $3.1 million for the year ended December 31, 2018. The decrease is primarily due to decrease in investor relations expense and a decrease in salary and related expenses which was partly offset by an increase in insurance expenses. We expect that general and administrative expenses will remain at the same level through 2020.
Financial income, net for the year ended December 31, 2019 were $2.4 million compared to financial expenses, net of $1.1 million in the same period in 2018. The decrease in financial expense, net was mainly due to decrease in a loss from short-term investment revaluation and increase in income from changes in fair value of warrants liability exercisable into shares.
Net loss for the year ended December 31, 2019 was $9.5 million compared with a net loss of $6.6 million for the year ended December 31, 2018. The increase in net loss for the year ended December 31, 2019 was primarily attributable to decrease in revenues in 2019 and an increase in research and development expenses which were partly offset by an increase in finance income, net.
As of December 31, 2019, Can-Fite had cash and cash equivalents of $2.7 million as compared to $3.6 million at December 31, 2018. The decrease in cash during the year ended December 31, 2019 is due to increase in net cash provided by financing activity which was offset by an increase in net cash used in operating activity. In February 2020, Can-Fite raised $5 million in a registered direct offering, and in January and March 2019 the Company received approximately $3.4 million through warrant exercises.
More detailed information can be found in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2019, a copy of which has been filed with the Securities and Exchange Commission (SEC). The Annual Report, which contains the Company’s audited consolidated financial statements, can be accessed on the SEC’s website at View Source as well as via the Company’s investor relations website at View Source The Company will deliver a hard copy of its Annual Report, including its complete audited consolidated financial statements, free of charge, to its shareholders upon request to Can-Fite Investor Relations at 10 Bareket Street, Kiryat Matalon, Petah-Tikva 4951778, Israel or by phone at +972-3-9241114.