Citius Pharma(CTXR) - 2022 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) Unaudited financial statements for June 30, 2022, show a $25.6 million net loss and $48.0 million cash, driven by increased R&D Condensed Consolidated Balance Sheets As of June 30, 2022, total assets decreased to $120.3 million, and total equity declined to $110.3 million Condensed Consolidated Balance Sheet Highlights (Unaudited) | Balance Sheet Item | June 30, 2022 | September 30, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $48,044,194 | $70,072,946 | | Total Current Assets | $50,834,513 | $72,814,350 | | Total Assets | $120,315,795 | $142,429,059 | | Total Current Liabilities | $4,461,122 | $3,982,292 | | Total Liabilities | $9,979,805 | $9,646,326 | | Total Equity | $110,335,990 | $132,782,733 | Condensed Consolidated Statements of Operations For the nine months ended June 30, 2022, the company reported a $25.6 million net loss, driven by increased R&D Statement of Operations Summary (Unaudited) | Metric | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | Revenues | $0 | $0 | | Research and development | $13,798,251 | $9,946,268 | | General and administrative | $9,038,949 | $7,389,269 | | Stock-based compensation | $2,929,279 | $993,114 | | Operating Loss | ($25,766,479) | ($18,328,651) | | Net Loss | ($25,649,906) | ($18,093,349) | | Net Loss Per Share | ($0.18) | ($0.20) | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities was $22.0 million, ending the period with $48.0 million in cash Cash Flow Summary (Unaudited) | Cash Flow Activity | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | ($22,028,752) | ($18,659,384) | | Net Cash Used In Investing Activities | $0 | ($6,938) | | Net Cash Provided By Financing Activities | $0 | $120,470,550 | | Net Change in Cash | ($22,028,752) | $101,804,228 | | Cash at End of Period | $48,044,194 | $115,663,976 | Notes to Condensed Consolidated Financial Statements The notes detail the company's critical care product focus, liquidity, and key license agreements - The company is a specialty pharmaceutical firm focused on anti-infective products in adjunct cancer care, prescription products, and stem cell therapy. Key assets include IPR&D for Mino-Lok ($19.4M) and I/ONTAK ($40M)[26][29] - The company has sufficient cash to fund operations through August 2023. Continued operations beyond this date depend on raising additional capital or generating revenue from product approvals (Mino-Lok or I/ONTAK)[39][40] - The company has several key license agreements: Mino-Lok with NAT, Mino-Wrap with the University of Texas, a cellular therapy via its subsidiary NoveCite with Novellus (now Brooklyn ImmunoTherapeutics), and I/ONTAK via an agreement with Dr. Reddy's/Eisai[42][45][50] - As of June 30, 2022, the company has reserved 53,299,589 shares of common stock for future issuances related to outstanding stock options (9.4M), available stock plan grants (3.9M), and outstanding warrants (40.0M)[90] Management's Discussion and Analysis of Financial Condition and Results of Operations Management attributes the increased net loss to higher R&D and G&A expenses, with working capital sufficient until August 2023 - The company is a late-stage biopharmaceutical firm focused on critical care products, including Mino-Lok, Mino-Wrap, Halo-Lido, I/ONTAK, and a cellular therapy for ARDS through its subsidiary NoveCite[101][104][105] Comparison of Operating Results (Three Months Ended June 30) | Expense Category | 2022 | 2021 | Change | | :--- | :--- | :--- | :--- | | Research & Development | $4,888,192 | $2,203,748 | +$2,684,444 | | General & Administrative | $3,024,783 | $3,407,088 | -$382,305 | | Stock-based Compensation | $1,003,677 | $373,570 | +$630,107 | | Net Loss | ($8,863,632) | ($5,824,008) | +$3,039,624 | Comparison of Operating Results (Nine Months Ended June 30) | Expense Category | 2022 | 2021 | Change | | :--- | :--- | :--- | :--- | | Research & Development | $13,798,251 | $9,946,268 | +$3,851,983 | | General & Administrative | $9,038,949 | $7,389,269 | +$1,649,680 | | Stock-based Compensation | $2,929,279 | $993,114 | +$1,936,165 | | Net Loss | ($25,649,906) | ($18,093,349) | +$7,556,557 | - The increase in R&D expenses is primarily due to costs for the I/ONTAK product candidate ($6.5M for nine months), start-up costs for the Halo-Lido Phase 2b trial, and expansion of the Mino-Lok Phase 3 trial[133][134][136] - With working capital of approximately $46.4 million and cash of $48.0 million at June 30, 2022, the company projects it has sufficient funds for operations through August 2023[147][148] Quantitative and Qualitative Disclosures about Market Risk This section is not applicable to the company - Not applicable[154] Controls and Procedures Management concluded disclosure controls and procedures were effective as of June 30, 2022, with no material internal control changes - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2022[156] - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2022, that have materially affected, or are reasonably likely to materially affect, internal controls[157] PART II. OTHER INFORMATION Legal Proceedings The company reports no legal proceedings - None[160] Risk Factors There have been no changes to the company's risk factors since its Form 10-K filed on December 15, 2021 - There has been no change in the Company's risk factors since the Form 10-K filed with the SEC on December 15, 2021[161] Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of equity securities - None[162] Other Information The company reports no other information - None[165] Exhibits This section lists the exhibits filed with the report, including officer certifications and Inline XBRL data files - The report includes certifications from the Principal Executive Officer and Principal Financial Officer, as well as Inline XBRL documents[167]