Financial Performance - For the three months ended September 30, 2020, the net loss was $10,660,000, compared to a net loss of $6,142,000 for the same period in 2019, indicating an increase in loss of approximately 73.5%[8] - Total operating expenses for the nine months ended September 30, 2020, were $26,735,000, up from $21,364,000 in the same period of 2019, reflecting an increase of about 25.2%[8] - The Company has an accumulated deficit of $496.6 million as of September 30, 2020, with working capital of $50.6 million[27] - The net loss for the three months ended September 30, 2020, was $10.66 million, resulting in a basic and diluted net loss per share of $(0.66)[89] - For the three months ended September 30, 2020, the company reported a net loss of $10.7 million, a 53% increase compared to a net loss of $7.0 million for the same period in 2019[127] Assets and Liabilities - As of September 30, 2020, total assets decreased to $61,230,000 from $82,121,000 as of December 31, 2019, representing a decline of approximately 25.4%[6] - Total liabilities decreased to $11,864,000 as of September 30, 2020, from $13,072,000 at the end of 2019, a decrease of approximately 9.2%[6] - Cash and cash equivalents decreased to $53,967,000 as of September 30, 2020, down from $65,134,000 at the end of 2019, a reduction of approximately 17.1%[6] - Cash and cash equivalents as of September 30, 2020, were approximately $54.0 million, with a majority invested in money market funds[134] - As of September 30, 2020, the company's cash and cash equivalents consist solely of Level 1 assets, which are highly liquid money market funds[48] Research and Development - Research and development expenses for the three months ended September 30, 2020, were $5,070,000, compared to $3,840,000 for the same period in 2019, marking an increase of about 32.1%[8] - The company anticipates an increase in research and development expenses as it initiates its pivotal PROC trial during the fourth quarter of 2020 or first quarter of 2021[134] - The Phase 1 clinical trial of AVB-500 demonstrated proof of mechanism in neutralizing GAS6, with a favorable safety profile[19] - The Phase 1b clinical trial of AVB-500 demonstrated a 31% objective response rate (ORR) among patients treated with AVB-500 in combination with paclitaxel, with a complete response (CR) observed[106] - The company expects to initiate a pivotal trial of AVB-500 in Platinum Resistant Ovarian Cancer during Q4 2020/Q1 2021[99] COVID-19 Impact - The Company terminated its IgA nephropathy trial to focus on oncology due to the impact of COVID-19 on clinical trials[20] - The Company is in close contact with clinical research organizations to assess the impact of COVID-19 on its clinical studies[20] - The Company has implemented business continuity plans to mitigate the impact of the COVID-19 pandemic on its operations[33] - The company has implemented work-from-home policies due to COVID-19, which may negatively impact productivity and disrupt business operations[153] - The ongoing COVID-19 pandemic has contributed to broad market fluctuations, impacting the stock price and investor sentiment[167] Financing and Grants - The company expects to need additional financing to support its clinical development programs and operations in the foreseeable future[135] - The company raised $10.0 million in matching funds as required by the CPRIT Grant[21] - The company received approximately $1.6 million of additional funding from its CPRIT Grant during the nine months ended September 30, 2020[134] - The company has financed its operations primarily through private placements, debt financing, and grants, including a $20.0 million CPRIT Grant[156] - The CPRIT Grant requires the Company to pay a portion of revenues from sales of certain products at tiered percentages until payments equal 400% of the grant award[22] Stock and Ownership - As of September 30, 2020, executive officers and principal stockholders collectively owned approximately 24.3% of the common stock, allowing them to significantly influence shareholder decisions[170] - The stock price has fluctuated between $3.07 and $144.00 per share from January 1, 2015, to September 30, 2020, indicating significant volatility[167] - The company entered into an equity distribution agreement with Piper Sandler and Cantor Fitzgerald to sell shares of common stock with an aggregate offering price of up to $60 million[102] Impairment and Expenses - The company incurred a loss on impairment of long-lived assets of $2,914,000 for the three months ended September 30, 2020[8] - The company recognized an impairment charge of $2.4 million for the ROU asset and $0.5 million for leasehold improvement assets for the quarter ended March 31, 2020[43] - A total impairment loss of $5.8 million was reported on the Company's long-lived asset balances for the nine-month period ended September 30, 2020[44] - The company incurred non-cash impairment charges of $2.9 million and $5.8 million for long-lived assets for the three and nine months ended September 30, 2020, respectively[131] - The estimated discount rate used in the impairment analysis was 9.5%[43] Legal and Compliance - The company is not currently subject to any material legal proceedings[148] - The company may face potential financial penalties and liabilities if it fails to comply with government funding requirements, which could adversely affect its financial condition[166] - The company has not engaged in any off-balance sheet arrangements since its inception[141] Operational Challenges - EVA has defaulted on its obligation to pay rent, resulting in a decrease in sublease income of approximately $9.3 million[162] - The company has drawn down on a cash security deposit of $760,727 due to missed rent payments by EVA, affecting its cash position[162] - The company must ensure that any new or expanded clinical trials or commercialization related to the CPRIT project take place in Texas, necessitating the hiring of additional qualified personnel[165]
Aravive(ARAV) - 2020 Q3 - Quarterly Report