Plus Therapeutics(PSTV) - 2021 Q2 - Quarterly Report

PART I FINANCIAL INFORMATION Item 1. Financial Statements Unaudited H1 2021 financials show increased assets, a $5.5 million net loss, and raise going concern doubts Consolidated Condensed Balance Sheets As of June 30, 2021, cash, total assets, and equity significantly increased due to stock issuances Balance Sheet Summary (in thousands) | Metric | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $17,161 | $8,346 | | Total current assets | $18,001 | $9,175 | | Total assets | $20,834 | $12,105 | | Liabilities & Equity | | | | Total current liabilities | $8,354 | $8,539 | | Total liabilities | $8,889 | $9,074 | | Total stockholders' equity | $11,945 | $3,031 | Consolidated Condensed Statements of Operations Net losses for Q2 and H1 2021 increased to $2.8 million and $5.5 million, driven by higher R&D expenses Statement of Operations Highlights (in thousands, except per share data) | Metric | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | | :--- | :--- | :--- | :--- | :--- | | Development revenues | $0 | $185 | $0 | $303 | | Research and development | $1,106 | $327 | $2,233 | $1,268 | | General and administrative | $1,469 | $1,429 | $2,821 | $3,047 | | Loss from operations | $(2,575) | $(2,352) | $(5,054) | $(4,793) | | Net loss | $(2,800) | $(1,839) | $(5,520) | $(2,926) | | Net loss per share | $(0.25) | $(0.45) | $(0.56) | $(0.74) | Consolidated Condensed Statements of Stockholders' Equity Stockholders' equity increased to $11.9 million by June 30, 2021, from stock sales and warrant exercises, offset by net loss - During the first half of 2021, the company raised approximately $7.1 million from the sale of common stock, net of offering costs, and an additional $2.0 million from the exercise of warrants[18] - In the second quarter of 2021, an additional $5.1 million was raised from the sale of common stock, net of offering costs[18] Consolidated Condensed Statements of Cash Flows H1 2021 saw $5.4 million net cash used in operations, offset by $14.3 million from financing, increasing cash to $17.2 million Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(5,405) | $(2,911) | | Net cash used in investing activities | $(80) | $(423) | | Net cash provided by (used in) financing activities | $14,300 | $(4,992) | | Net increase (decrease) in cash | $8,815 | $(8,326) | - Financing activities in H1 2021 included $12.3 million in net proceeds from the sale of common stock and $2.0 million from the exercise of warrants[20] Notes to Consolidated Condensed Financial Statements Notes detail accounting policies, liquidity concerns raising substantial doubt about going concern due to recurring losses - The company incurred a net loss of $5.5 million for the six months ended June 30, 2021, and had an accumulated deficit of $439.0 million, raising substantial doubt about its ability to continue as a going concern[28] - The company raised $6.3 million (net) through its At-the-Market (ATM) agreement with Canaccord and $6.0 million (net) through its purchase agreement with Lincoln Park during the first six months of 2021[30][31] - On June 22, 2021, the company was named as a defendant in a lawsuit by Lorem Vascular, Pte. Ltd., which is seeking at least $6.0 million in damages, though the company believes the claims are without merit[58] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses clinical-stage drug development, increased R&D, precarious liquidity, and reliance on recent financing Overview and Pipeline Plus Therapeutics focuses on its RNL nanotechnology platform for rGBM, currently in Phase 1 trials with FDA designations - The company's lead drug, Rhenium NanoLiposomes (RNL), is being developed for recurrent glioblastoma (rGBM) and is supported by a $3 million award from NIH/NCI[86] - RNL is currently in a Phase 1 dose-finding clinical trial (ReSPECT™), which has completed its seventh dose escalation cohort and is proceeding to an eighth cohort with a 40% increase in drug volume and radiation dose[92] - In September 2020, the FDA granted both Orphan Drug and Fast Track designations to RNL for the treatment of glioblastoma[93] Results of Operations Q2 and H1 2021 saw no revenue, significant increases in R&D expenses for RNL development, and stable G&A Research and Development Expenses (in thousands) | Period | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $1,106 | $327 | +$779 | | Six Months Ended June 30 | $2,233 | $1,268 | +$965 | - The increase in R&D expenses for both the three and six-month periods was primarily due to increased expenditures related to the development of RNL in compliance with cGMP requirements[101] - General and administrative expenses decreased by $0.2 million for the six months ended June 30, 2021, compared to 2020, mainly due to a $0.6 million reduction in legal expenses, offset by increases in stock-based compensation and consulting services[104] Liquidity and Capital Resources Liquidity raises going concern doubt, relying on $12.3 million in H1 2021 equity financing to offset losses Key Liquidity Measures (in thousands) | Metric | June 30, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Cash and cash equivalents | $17,161 | $8,346 | | Working capital | $9,647 | $636 | - During H1 2021, the company issued 2,179,193 shares under its ATM agreement for net proceeds of $6.3 million, exhausting the program[114] - During H1 2021, the company issued 2,262,686 shares under its purchase agreement with Lincoln Park for net proceeds of $6.0 million[115] Item 3. Quantitative and Qualitative Disclosures about Market Risk The company states that quantitative and qualitative disclosures about market risk are not applicable - The company has determined that quantitative and qualitative disclosures about market risk are not applicable[129] Item 4. Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2021, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[131] - No material changes were made to the company's internal control over financial reporting during the quarter ended June 30, 2021[132] PART II OTHER INFORMATION Item 1. Legal Proceedings The company faces a new lawsuit seeking at least $6.0 million in damages over alleged false representations, which it intends to defend - On June 22, 2021, the company was sued by Lorem Vascular, Pte. Ltd. in the District Court for the District of Delaware[133] - The lawsuit alleges false representations regarding a UK manufacturing facility sold to Lorem in 2019 and seeks at least $6,000,000 in damages[133] - The company believes the claims are without merit, intends to vigorously defend the case, and has not accrued any liability as of June 30, 2021[133] Item 1A. Risk Factors There have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K - There have been no material changes to the risk factors included in the company's Annual Report on Form 10-K for the year ended December 31, 2020[134] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including officer certifications and XBRL data files - This section lists all exhibits filed with the Form 10-Q, including officer certifications (Exhibits 31.1, 31.2, 32.1) and interactive data files (Exhibits 101 and 104)[137]