Cardiff Oncology(CRDF) - 2022 Q3 - Quarterly Report

PART I FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed financial statements for the quarterly period ended September 30, 2022, including balance sheets, statements of operations, comprehensive loss, stockholders' equity, and cash flows, along with detailed notes Condensed Balance Sheets The balance sheet as of September 30, 2022, shows a decrease in total assets to $123.6 million from $149.5 million at the end of 2021, primarily due to a reduction in short-term investments, with total liabilities increasing slightly and stockholders' equity decreasing Condensed Balance Sheet Highlights (in thousands) | Account | Sep 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $18,717 | $11,943 | | Short-term investments | $95,586 | $128,878 | | Total Current Assets | $119,755 | $146,127 | | Total Assets | $123,631 | $149,544 | | Liabilities & Equity | | | | Total current liabilities | $8,245 | $6,559 | | Total Liabilities | $10,419 | $9,127 | | Total stockholders' equity | $113,212 | $140,417 | Condensed Statements of Operations For the three months ended September 30, 2022, the company reported an increased net loss of $8.6 million, driven by higher research and development expenses, with the nine-month net loss growing to $30.0 million Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Royalty revenues | $93 | $86 | $258 | $226 | | Research and development | $6,009 | $4,154 | $20,665 | $11,552 | | Selling, general and administrative | $3,077 | $2,930 | $10,103 | $8,003 | | Loss from operations | ($8,993) | ($6,998) | ($30,510) | ($19,329) | | Net loss | ($8,571) | ($6,913) | ($30,007) | ($18,849) | | Net loss per common share | ($0.20) | ($0.17) | ($0.69) | ($0.49) | Condensed Statements of Cash Flows For the nine months ended September 30, 2022, net cash used in operating activities increased to $24.4 million, while investing activities provided $31.1 million, primarily from short-term investments Cash Flow Summary (Nine Months Ended Sep 30, in thousands) | Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($24,430) | ($15,650) | | Net cash provided by (used in) investing activities | $31,129 | ($122,654) | | Net cash provided by financing activities | $75 | $20,488 | | Net change in cash and cash equivalents | $6,774 | ($117,816) | | Cash and cash equivalents—End of period | $18,717 | $13,165 | Notes to Condensed Financial Statements The notes provide context to the financial statements, detailing the company's business, accounting policies, liquidity, fair value measurements, lease obligations, and stockholders' equity - Cardiff Oncology is a clinical-stage biotechnology company focused on developing its lead asset, onvansertib, a PLK1 inhibitor, for various cancer indications[25] - As of September 30, 2022, the company had $114.3 million in cash, cash equivalents, and short-term investments and believes it has sufficient cash to meet funding requirements for at least the next 12 months[27] - The company has a license agreement with Nerviano for the development and commercialization rights to onvansertib, which includes potential development milestones and royalty payments[64] - Subsequent to the quarter end, on October 11, 2022, 327,509 Series E Convertible Preferred Shares were converted into 1,342,250 shares of common stock[66] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management provides an overview of the company's business, focusing on the clinical development of its lead drug candidate, onvansertib, analyzing financial results and assessing liquidity and capital resources Overview The company is a clinical-stage biotech focused on developing onvansertib, an oral and highly selective PLK1 inhibitor, detailing progress of five clinical trials for onvansertib in various cancers - The company's lead drug candidate is onvansertib, an oral, highly selective PLK1 inhibitor with a 24-hour half-life, being developed in combination with standard-of-care therapies[71][72] - Updated data from the TROV-054 Phase 1b/2 trial in KRAS-mutated mCRC showed an Objective Response Rate (ORR) of 35% and a median Progression-Free Survival (mPFS) of 9.3 months across 48 evaluable patients[79] - The company plans to activate the ONSEMBLE trial, a Phase 2 randomized clinical trial in KRAS-mutated mCRC, in Q4 2022, with topline data anticipated in the second half of 2024[82][84] Results of Operations This section analyzes the financial performance for the three and nine-month periods ending September 30, 2022, showing an increased net loss primarily due to a substantial rise in Research and Development (R&D) expenses R&D Expense Comparison (Three Months Ended Sep 30, in thousands) | Category | 2022 | 2021 | Change | | :--- | :--- | :--- | :--- | | Salaries and staff costs | $1,000 | $521 | $479 | | Clinical trials, outside services, and lab supplies | $4,279 | $3,104 | $1,175 | | Total R&D | $6,009 | $4,154 | $1,855 | R&D Expense Comparison (Nine Months Ended Sep 30, in thousands) | Category | 2022 | 2021 | Change | | :--- | :--- | :--- | :--- | | Salaries and staff costs | $3,131 | $1,095 | $2,036 | | Clinical trials, outside services, and lab supplies | $15,699 | $9,510 | $6,189 | | Total R&D | $20,665 | $11,552 | $9,113 | - The increase in net loss for the nine months ended September 30, 2022, was primarily driven by a $9.1 million increase in R&D expenses and a $2.1 million increase in SG&A expenses compared to the same period in 2021[98][100][101] Liquidity and Capital Resources As of September 30, 2022, the company had $114.3 million in cash, cash equivalents, and short-term investments, which management asserts are sufficient to fund operations into 2025, despite increased cash used in operating activities - The company had $114.3 million in cash, cash equivalents, and short-term investments as of September 30, 2022[106] - Based on current projections, the company expects its capital resources are sufficient to fund operations into 2025[106] - Net cash used in operating activities for the nine months ended September 30, 2022, was $24.4 million, compared to $15.7 million for the same period in 2021, primarily due to a higher net loss[102] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company has indicated that this section is not applicable - Not applicable[109] Item 4. Controls and Procedures Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of September 30, 2022, with no material changes in internal control over financial reporting - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2022[110] - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[112] PART II OTHER INFORMATION Item 1. Legal Proceedings The company reported no legal proceedings during the period - None[116] Item 1A. Risk Factors There have been no material changes from the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - There have been no material changes from the risk factors disclosed in the Form 10-K for the year ended December 31, 2021[117] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including officer certifications and XBRL data files - The exhibits filed with the report include certifications from the Principal Executive Officer and Principal Financial Officer, as well as Inline XBRL documents[122]