ESSA Pharma (EPIX) - 2025 Q1 - Quarterly Report

Financial Performance - Net loss for the period increased to $8,531,931 for the three months ended December 31, 2024, compared to a net loss of $5,964,322 for the same period in 2023, reflecting a rise of approximately 42%[27] - Comprehensive loss for the three months ended December 31, 2024, was $8,531,931, compared to a loss of $5,964,322 for the same period in 2023, reflecting an increase of approximately 43%[213] - The company has never been profitable and expects to incur losses for the foreseeable future as it winds down clinical and preclinical development programs[213] Assets and Liabilities - Total assets decreased from $128,112,003 as of September 30, 2024, to $122,634,340 as of December 31, 2024, representing a decline of approximately 4.1%[26] - Total liabilities increased to $3,867,336 as of December 31, 2024, from $3,506,233 as of September 30, 2024, an increase of about 10.3%[26] - Cash and cash equivalents decreased from $103,709,537 at the beginning of the period to $93,310,889 by the end of the period, a reduction of about 10.5%[29] Expenses - Research and development expenses were $5,474,147 for the three months ended December 31, 2024, slightly up from $5,376,764 in the prior year, indicating a year-over-year increase of about 1.8%[27] - General and administration expenses surged to $4,210,719 in Q1 2024, compared to $2,217,868 in Q1 2023, marking an increase of approximately 89.9%[27] - Clinical costs increased to $3,248,718 in Q4 2024 from $1,827,247 in Q4 2023, marking an increase of approximately 78% due to expanded clinical trial activities[214] - Share-based payments increased significantly to $2,701,931 in Q1 2024 from $803,418 in Q1 2023, reflecting a rise of approximately 236%[30] - Share-based payments in general and administrative expenses increased to $1,972,151 in Q4 2024 from $277,177 in Q4 2023, reflecting a substantial rise in non-cash expenses[222] Clinical Trials and Research - The company has terminated its clinical trial of masofaniten, its primary molecule, and is currently evaluating its future operations[34] - The Company terminated its clinical trials for masofaniten (EPI-7386) based on interim review data showing a higher PSA90 response rate in patients treated with enzalutamide monotherapy compared to the combination therapy[82] - The decision to discontinue clinical trials was mutually agreed upon by senior management and the board of directors, indicating a strategic shift in focus[82] - The Company has decided to withdraw its Investigational New Drug application and related clinical trial applications for masofaniten[84] - The company has suspended enrollment in a clinical trial with Janssen due to operational recruitment challenges[128] - The company has terminated its preclinical development programs while exploring other potential clinical applications for NTD inhibitors[134] Strategic Review and Future Plans - The Company is undergoing a comprehensive review of strategic options to maximize shareholder value, which may include mergers, acquisitions, or other strategic transactions[79] - The company is reviewing strategic options, which may include mergers, asset sales, or seeking new product candidates for development[136] - The company is not currently engaged in any collaborations for clinical development and future plans depend on ongoing strategic evaluation[168] Market and Competitive Position - The prostate cancer market is significant, with an estimated 299,010 new cases in 2024 and 35,250 deaths expected[92] - Approximately 260,000 men with prostate cancer were treated in the U.S. in 2023 with systemic treatments who had not yet received a second-generation antiandrogen[92] - ESSA's competitive position is believed to be strong due to its unique approach to prostate cancer treatment targeting AR activation[167] Intellectual Property and Regulatory Compliance - ESSA has in-licensed intellectual property related to compounds that modulate AR activity, providing exclusive rights to develop and commercialize products based on this IP[175] - The company is required to pay up to C$2.4 million for the first drug product developed under the license and C$510,000 for each subsequent product[177] - The patent protection for masofaniten (EPI-7386) is expected to last until expiration dates ranging from 2036 to 2043[183] - Regulatory compliance is essential for the production and manufacture of future product candidates, subject to various governmental regulations[185] Shareholder and Financial Obligations - The Company has a maximum of 10,810,907 common shares reserved for issuance under the Omnibus Incentive Plan as of December 31, 2024[57] - The Company has $139,204 due to related parties, an increase from $98,360 as of September 30, 2024[68] - The company has not incurred any immediate financial obligations related to the termination of the clinical trial, indicating a potential for cost savings in the short term[34]