On November 10, 2016 Heat Biologics, Inc. ("Heat") (Nasdaq:HTBX), an immuno-oncology company developing novel therapies that activate a patient’s immune system against cancer, reported its financial results and provided a general business update for the third quarter and nine months ended September 30, 2016 (Press release, Heat Biologics, NOV 10, 2016, View Source [SID1234516526]).

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"We look forward to reporting top-line data in both our bladder and lung cancer trials within the next few weeks," commented Jeff Wolf, Heat’s Founder and CEO. "Our results come on the heels of encouraging interim study findings from our Phase 1b trial evaluating HS-110 in combination with the Bristol-Myers Squibb anti-PD-1 checkpoint inhibitor, nivolumab. Our data in lung cancer suggest HS-110 may improve response rates for patients with ‘cold tumors’ who typically have lower response rates to checkpoint inhibitor monotherapy. We are also encouraged by our early data in bladder cancer that suggest we are activating a robust antigen-specific immune response.

"Moreover, we are pleased to announce the expansion of our gp96 platform into the infectious disease arena. We recently formed a new subsidiary, Zolovax, which will focus exclusively on developing gp96-based vaccines for Zika and other infectious diseases, such as HIV, West Nile, dengue and yellow fever. Preclinical studies suggest that our gp96 platform may have a role as a broad-based infectious disease vaccine. Importantly, in the case of Zika, the robust mucosal immune response generated by gp96 in ongoing oncology studies may suggest that a gp96 vaccine could also stimulate a Zika-specific immune response in the placenta, thus protecting the fetus from virus transmission.

"During the third quarter, we strengthened our balance sheet and benefitted from the exercise of warrants and substantial pay down of our existing debt. I am pleased to report we ended the quarter with approximately $8.5 million of cash on hand. This year through November 10, 2016, we have generated over $3.1 million in cash from the exercise of our March 23, 2016 warrants. Meanwhile, we continue to carefully manage our expenses as we await important top-line data this quarter."

Recent Developments & Third Quarter 2016 Corporate Highlights

In late October, Heat announced that it entered into an agreement with the University of Miami for the license and development of a portfolio of patents leveraging its gp96 platform to target the Zika virus and other infectious diseases including HIV, West Nile, dengue and yellow fever.
In October, Heat announced that it has advanced its biomarker discovery collaboration with Adaptive Biotechnologies. Adaptive will use its patented immune profiling assay, immunoSEQ, to enable an in-depth characterization of the immune response to Heat’s ImPACT and ComPACT-based immunotherapies, including HS-410, Heat’s Phase 2 product candidate for non-muscle invasive bladder cancer.
In September, Heat announced that it had resumed enrollment in its Phase 1b trial evaluating HS-110 in combination with nivolumab (Opdivo), a Bristol-Myers Squibb anti-PD-1 checkpoint inhibitor, for the treatment of non-small cell lung cancer (NSCLC). The decision to resume trial enrollment was based on the encouraging data reported in June, including two clinical responses in "cold tumor" patients. There are currently 15 patients enrolled and the Company expects to report topline 6-month data on the first eight of these patients before year end.
In July, Heat announced that preclinical findings from its ComPACT platform technology were published online in the journal "Cancer Immunology Research." Heat demonstrated that its ComPACT technology secreting the co-stimulator OX40L enhanced tumor rejection in two cancer tumor types compared to OX40 agonist antibody treatment. Heat also reported that ComPACT-enhanced antigen-specific T cell infiltration into tumors improved memory T cell responses and demonstrated greater specificity than OX40 agonist antibody treatments.
Third Quarter 2016 Financial Highlights

Research and development (R&D) expenses decreased to approximately $0.6 million in the third quarter of 2016 compared to approximately $0.7 million in the third quarter of 2015, a decrease of approximately $0.1 million. The decrease is primarily attributable to reductions in consultant fees and a decrease in compensation costs attributable to deferral of salary as part of our cost-savings plan.
Clinical and regulatory expenses decreased to approximately $1.1 million in the third quarter of 2016 compared to approximately $3.7 million in the third quarter of 2015, a decrease of approximately $2.6 million. The decrease is primarily attributable to reductions in clinical trial execution costs.
General and administrative (G&A) expenses decreased to approximately $0.8 million in the third quarter of 2016 compared to approximately $0.9 million in the third quarter of 2015, a decrease of $0.1 million. The decrease is attributable to a reduction in compensation costs and work force reductions as part of the cost-savings plan.
Net loss for the third quarter of 2016 was $1.7 million compared to a net loss of $5.4 million for the third quarter of 2015.
Nine Months Ended September 30, 2016 Financial Highlights

R&D expenses decreased to approximately $1.5 million for the nine months ended September 30, 2016 compared to approximately $1.8 million for the nine months ended September 30, 2015, a decrease of approximately $0.3 million. The decrease is attributable to reductions in patent, license and other professional fees, as well as a decrease in consultant expense and a decrease in compensation costs attributable to deferral in salary as part of our cost-savings initiatives.
Clinical and regulatory expenses decreased to approximately $5.6 million for the nine months ended September 30, 2016 compared to approximately $9.2 million for the nine months ended September 30, 2015, a decrease of approximately $3.6 million. The decrease is primarily attributable to reductions in clinical trial execution expenses.
G&A expenses decreased to approximately $2.9 million for the nine months ended September 30, 2016 compared to approximately $3.1 million for the nine months ended September 30, 2015, a decrease of approximately $0.2 million. The decrease is primarily attributable to a decrease in compensation costs attributable to deferral of salary and work force reductions as part of our cost-savings plan.
Net loss for the nine months ended September 30, 2016 was $9.4 million compared to a net loss of $14.4 million for the nine months ended September 30, 2015.
Cash and cash equivalents totaled approximately $8.5 million at September 30, 2016 compared to cash, cash equivalents and short-term investments which totaled approximately $11.6 million at December 31, 2015.