Qualigen Therapeutics(US:QLGN)2025-08-14 21:29Business Focus - The company is focused on developing treatments for adult and pediatric cancer, with one early-clinical-stage program (QN-302) and one preclinical program (Pan-RAS) [169]. - QN-302 is a small molecule G-quadruplexes selective transcription inhibitor aimed at inhibiting cancer cell proliferation, particularly in pancreatic cancer [170]. - The Pan-RAS program targets mutated RAS genes, potentially effective in treating approximately 25% of all cancers, including pancreatic, colorectal, and lung cancers [171]. Financial Agreements - A Co-Development Agreement with Marizyme, Inc. includes a funding payment of up to $1,750,000 and a 33% royalty on net sales of Marizyme's DuraGraft™ after a cumulative total of $500,000 in sales [172]. - As of June 30, 2025, the company advanced $3,775,900 to Marizyme, with accrued interest of $364,596 on the Marizyme Notes [180]. Profitability and Expenses - The company does not expect to be profitable before commercializing products from its therapeutics pipeline and has implemented expense controls to manage losses [173]. - General and administrative expenses increased from $1.0 million in Q2 2024 to $1.4 million in Q2 2025, a rise of 38% [190]. - Research and development expenses decreased from $0.8 million in Q2 2024 to $18,000 in Q2 2025, a decline of 98% [191]. - Total expenses for Q2 2025 were $1.7 million, compared to $1.7 million in Q2 2024, indicating a slight decrease in overall expenses [188]. - Net loss from continuing operations was $1.7 million in Q2 2025, compared to a net loss of $1.5 million in Q2 2024 [188]. - For the six months ended June 30, 2025, total expenses were $4.4 million, up from $3.2 million in the same period in 2024, an increase of 39% [202]. - Research and development costs for the six months ended June 30, 2025, decreased to $51,000 from $1.1 million in the same period in 2024, a drop of 95% [204]. Credit and Cash Flow - The estimated expected credit losses on the Marizyme Notes is $828,000, reflecting the uncertain nature of the debtor's financial condition [182]. - Interest income increased from $3,000 in the first half of 2024 to $0.3 million in the first half of 2025, a rise of 10,000% [210]. - The company reported a net loss of $4.3 million for the six months ended June 30, 2025, compared to a net loss of $3.6 million in the same period in 2024 [202]. - For the six months ended June 30, 2025, the company incurred a net cash outflow of $2.69 million from operating activities, compared to a net cash outflow of $2.26 million for the same period in 2024 [236]. - The company recorded a net decrease in cash of $843,007 for the six months ended June 30, 2025, compared to a decrease of $283,118 for the same period in 2024 [236]. Funding and Financial Position - The company raised a total of $3.64 million from short-term borrowings from nine investors between January and July 2025, and closed a private placement transaction in July 2025 to raise an additional $4.26 million [217]. - The company has an accumulated deficit of $127.2 million as of June 30, 2025, and expects to continue incurring losses [215]. - The company expects to continue facing challenges regarding liquidity and has raised substantial doubt about its ability to continue as a going concern [218]. - The company has obligations under various license agreements that may require future payments based on the achievement of certain milestones, which are not recorded on the balance sheet [221]. Convertible Notes - The 2025 Convertible Note issued to Alpha Capital Anstalt has a principal of $264,000 and an original issue discount of 20%, convertible at $3.80 per share [185]. - As of June 30, 2025, the fair value of the 2025 Convertible Note was reassessed at $142,069, resulting in a gain of $37,874 for the quarter [187]. - The company recorded a loss of $91,943 upon the issuance of the 2025 Convertible Note, which had a fair value of $311,943 at issuance [228]. Cash Flow Activities - Net cash used in investing activities for the six months ended June 30, 2025 was $1.5 million due to advances to Marizyme [239]. - Net cash provided by financing activities for the six months ended June 30, 2025 was $3.4 million, resulting from the issuance of short-term debt of $3.3 million and convertible debt of $0.2 million [240]. - Cash flows from operating activities for the six months ended June 30, 2025 were negatively impacted by a $55,000 gain on change in fair value of warrant liabilities and a $0.3 million increase in accrued interest [237].