Kintara Therapeutics(KTRA) - 2023 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements The company's interim statements show a significant net loss and negative cash flow, raising substantial doubt about its going concern status Condensed Consolidated Interim Balance Sheet Highlights (in thousands) | Account | March 31, 2023 | June 30, 2022 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $3,045 | $11,780 | | Total current assets | $6,016 | $13,258 | | Total assets | $6,740 | $15,948 | | Liabilities & Equity | | | | Total current liabilities | $2,790 | $3,990 | | Total liabilities | $2,954 | $4,153 | | Total stockholders' equity | $3,786 | $11,795 | Condensed Consolidated Interim Statements of Operations Highlights (in thousands) | Metric | Three months ended Mar 31, 2023 | Nine months ended Mar 31, 2023 | | :--- | :--- | :--- | | Research and development | $2,005 | $7,235 | | General and administrative | $1,297 | $4,212 | | Net loss for the period | $(3,264) | $(11,314) | | Net loss attributable to common stockholders | $(3,266) | $(11,682) | | Basic and fully diluted loss per share | $(1.94) | $(7.32) | - The company's financial condition indicates substantial doubt about its ability to continue as a going concern, with a loss of $11.3 million and negative cash flow from operations of $10.4 million[27] - On November 10, 2022, the company executed a 1-for-50 reverse stock split of its common stock, and all per-share data has been retrospectively restated[30] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses its focus on cancer therapies, decreased operating expenses, and critically low liquidity reinforcing the going concern risk Product Pipeline and Corporate Strategy The strategy centers on advancing the lead GBM drug VAL-083 while pausing the REM-001 program to conserve cash and exploring strategic options - The company's two lead candidates are VAL-083 for glioblastoma (GBM) and REM-001 for cutaneous metastatic breast cancer (CMBC)[92] - The REM-001 program was paused to conserve cash resources, with an expected savings of approximately $3.0 million through calendar 2023[132] - Topline results for the VAL-083 GBM AGILE Study are expected around the end of the fourth quarter of calendar 2023[94][105] - The company is evaluating strategic options which may include raising additional capital, acquiring another company or assets, a sale, or other strategic partnerships[103] Results of Operations Operating expenses decreased significantly year-over-year due to lower clinical development costs and reduced personnel expenses Comparison of Expenses for the Three Months Ended March 31 (in thousands) | Expense Category | 2023 | 2022 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Research and development | $2,005 | $3,474 | $(1,469) | (42%) | | General and administrative | $1,297 | $1,884 | $(587) | (31%) | Comparison of Expenses for the Nine Months Ended March 31 (in thousands) | Expense Category | 2023 | 2022 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Research and development | $7,235 | $11,169 | $(3,934) | (35%) | | General and administrative | $4,212 | $6,055 | $(1,843) | (30%) | - The decrease in R&D expenses was largely due to lower clinical development costs for the GBM AGILE Study and the pausing of the REM-001 program[148][149][154] - The decrease in G&A expenses was mainly a result of lower non-cash, share-based compensation and a reduction in personnel costs[150][155] Liquidity and Capital Resources The company's precarious financial position, with only $3.0 million in cash, creates substantial doubt about its ability to continue as a going concern Cash Flow Summary for the Nine Months Ended March 31 (in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,357) | $(15,400) | | Net cash used in investing activities | $(232) | $0 | | Net cash provided by financing activities | $1,854 | $13,702 | - As of March 31, 2023, the company had cash and cash equivalents of $3.0 million and an accumulated deficit of $148.0 million[164] - The company received approximately $1.86 million in net proceeds from a stock purchase agreement, which is the maximum amount currently available under the agreement due to Nasdaq ownership limitations[161][164] - The company's financial state indicates substantial doubt about its ability to continue as a going concern, and it will require additional funding to maintain operations[164][165] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section is not applicable as the company qualifies as a smaller reporting company - Disclosure is not required for a smaller reporting company[175] Item 4. Controls and Procedures Disclosure controls and procedures were deemed effective, with no material changes to internal controls over financial reporting during the quarter - The company's disclosure controls and procedures were evaluated and found to be effective as of the end of the period covered by the report[176] - No material changes to the company's internal control over financial reporting were identified during the quarter ended March 31, 2023[178] PART II - OTHER INFORMATION Item 1. Legal Proceedings The company reports that it is not a party to any legal proceedings, nor is any of its property subject to such proceedings - The company is not party to any legal proceedings[181] Item 1A. Risk Factors No material changes to the risk factors previously disclosed in the company's Annual Report have been reported - No material changes to risk factors were reported since the last Annual Report on Form 10-K[182] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None reported[183] Item 3. Defaults Upon Senior Securities The company reported no defaults upon senior securities - None reported[184] Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable[185] Item 5. Other Information The company reported no other information - None reported[186] Item 6. Exhibits This section lists filed exhibits, including officer certifications and Inline XBRL financial data files - The report includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[187] - Inline XBRL Instance Documents and related taxonomy files are also included as exhibits[187]