PharmaCyte Biotech(PMCB) - 2024 Q1 - Quarterly Report

Product Development - The company is focused on developing cellular therapies for cancer, diabetes, and malignant ascites using its proprietary Cell-in-a-Box technology [129]. - The current product candidate, CypCaps™, is intended for use in therapies for several types of cancer, including locally advanced pancreatic cancer (LAPC) [129]. - The company is developing therapies for Type 1 diabetes and insulin-dependent Type 2 diabetes using encapsulated genetically modified insulin-producing cells [133][135]. - The company is also exploring the use of its technology for therapies involving prodrugs based on constituents of the Cannabis plant, but further development is on hold until FDA approval is obtained [134]. - The encapsulation technology aims to create a micro-environment for genetically engineered live human cells, enhancing their survival and production of active molecules [130]. - The company is evaluating the potential for cellular and humoral immune reactivity against the heterologous rat CYP2B1 protein as part of its clinical trial preparations [140]. Regulatory and Clinical Trials - The FDA has placed a clinical hold on the company's Investigational New Drug (IND) application for LAPC since October 1, 2020, requiring additional data and studies to lift the hold [137]. - The company has curtailed spending on development programs pending a review by the Business Review Committee, which may delay timelines for addressing the FDA clinical hold [129][136]. - The company is in the latter stages of conducting studies to address FDA requests, including genetic stability studies and compatibility assessments of delivery devices [139]. - The company has entered into service agreements estimated at approximately $482,000 to address the clinical hold on its IND submission involving LAPC [160]. Financial Performance - No revenues reported for the three months ended July 31, 2023, consistent with the same period in 2022 [146]. - Total operating expenses for the three months ended July 31, 2023, were$2,075,326, an increase of $394,718 (approximately 23.5$104,483 for the three months ended July 31, 2023, compared to $159,273 in 2022 [148]. - General and administrative, legal, and professional expenses increased by 47$1,680,630 for the three months ended July 31, 2023, compared to $1,140,890 in 2022 [148]. - Other net expenses for the three months ended July 31, 2023, were$(1,107,971), compared to other income of $135,596 in the same period in 2022 [149]. - Net cash used in operating activities for the three months ended July 31, 2023, was$342,959, a significant improvement from $(1,084,378) in 2022 [151]. - Cash and cash equivalents totaled approximately$75 million as of July 31, 2023, down from approximately $82 million in 2022 [156]. - Working capital was approximately$73 million as of July 31, 2023, compared to approximately $81 million in 2022 [156]. - The company repurchased common stock amounting to approximately$26,457,000 during the three months ended July 31, 2023 [154]. - The company raised approximately $32,736,000 from the issuance of preferred stock, net of issuance costs, during the same period [154]. - The company sold 35,000 Preferred Shares and Warrants for gross proceeds of$35 million, with potential additional proceeds of approximately $35 million if all Warrants are exercised [157]. - The company expects to fund operating expenses for at least the next 12 months using existing cash balances and may consider additional debt or equity issuances [158]. Accounting and Reporting - The company’s financial statements are prepared in accordance with U.S. GAAP, requiring management to make critical accounting estimates and judgments [161]. - Research and Development expenses are expensed as incurred, including costs for technologies with no alternative future use [163]. - Stock-based compensation is measured and recognized according to ASC 718, impacting the company's financial results [164]. - Basic net income (loss) per share is calculated using the weighted-average number of shares outstanding, with potentially dilutive options excluded due to anti-dilutive effects [165]. Risk Management - The Board is reviewing risks associated with the company's relationship with SG Austria, which may impact the development of its product candidates [129].