PART I - FINANCIAL INFORMATION Financial Statements Kintara's Q3 2022 financials show significant losses and negative cash flow, raising substantial doubt about its going concern ability Condensed Consolidated Interim Balance Sheet Data (in thousands) | Account | March 31, 2022 (unaudited) | June 30, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $8,839 | $10,537 | | Total current assets | $10,093 | $11,793 | | Total assets | $12,798 | $13,543 | | Total current liabilities | $3,240 | $2,780 | | Total liabilities | $3,412 | $2,962 | | Total stockholders' equity | $9,386 | $10,581 | Condensed Consolidated Interim Statements of Operations (in thousands, except per share amounts) | Metric | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Nine Months Ended Mar 31, 2022 | Nine Months Ended Mar 31, 2021 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $3,474 | $3,843 | $11,169 | $7,784 | | General and administrative | $1,884 | $2,762 | $6,055 | $7,091 | | In-process research and development | — | — | — | $16,094 | | Net loss | $(5,356) | $(6,635) | $(17,215) | $(31,566) | | Net loss attributable to common stockholders | $(5,358) | $(6,643) | $(19,683) | $(34,768) | | Basic and fully diluted loss per share | $(0.11) | $(0.23) | $(0.45) | $(1.47) | Condensed Consolidated Interim Statements of Cash Flows (in thousands) | Cash Flow Activity | Nine months ended March 31, 2022 | Nine months ended March 31, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(15,400) | $(14,171) | | Net cash provided by investing activities | — | $964 | | Net cash provided by financing activities | $13,702 | $26,533 | | (Decrease) increase in cash | $(1,698) | $13,326 | - The company's financial condition, including a net loss of $17.2 million and negative operating cash flow of $15.4 million for the nine months ended March 31, 2022, indicates substantial doubt about its ability to continue as a going concern. Management plans to seek additional funding, but success is not assured. A subsequent registered direct financing in April 2022 provided net proceeds of approximately $7.9 million3291 Management's Discussion and Analysis of Financial Condition and Results of Operations Kintara, a clinical-stage biopharmaceutical company, is advancing two lead candidates while managing increased R&D costs and persistent going concern uncertainties Product Pipeline The company's pipeline is led by VAL-083 for GBM, currently in a registrational study, and REM-001 for CMBC, with a confirmatory study planned - The company's two lead candidates are VAL-083 for glioblastoma multiforme (GBM) and REM-001, a photodynamic therapy (PDT) for cutaneous metastatic breast cancer (CMBC)107 - VAL-083 is being evaluated in the GBM AGILE registrational Phase 2/3 study across all three GBM patient subtypes. Topline data is expected around the end of calendar year 2023110113116 - In a Phase 2 study for newly-diagnosed MGMT-unmethylated GBM, VAL-083 demonstrated a median Overall Survival (mOS) of 19.1 months, comparing favorably to historical temozolomide (TMZ) control data of 12.7-16.0 months128 - REM-001 therapy showed a complete response in approximately 80% of evaluable tumor sites in previous Phase 2/3 studies for CMBC. A 15-patient confirmatory study is planned to begin enrollment in mid-2022111158 Results of Operations Net loss decreased for both three and nine-month periods ended March 31, 2022, primarily due to reduced non-cash charges and lower G&A, despite increased R&D Comparison of Operations for the Three Months Ended March 31 (in thousands) | Expense Category | 2022 | 2021 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Research and development | $3,474 | $3,843 | $(369) | (10%) | | General and administrative | $1,884 | $2,762 | $(878) | (32%) | | Net loss | $(5,356) | $(6,635) | $1,279 | (19%) | - The decrease in R&D and G&A expenses for the three-month period was largely due to lower non-cash, share-based compensation compared to the prior year, which had higher expenses related to stock options granted in September 2020188191 Comparison of Operations for the Nine Months Ended March 31 (in thousands) | Expense Category | 2022 | 2021 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Research and development | $11,169 | $7,784 | $3,385 | 43% | | General and administrative | $6,055 | $7,091 | $(1,036) | (15%) | | In-process research and development | — | $16,094 | $(16,094) | (100%) | | Net loss | $(17,215) | $(31,566) | $14,351 | (45%) | - The increase in R&D expenses for the nine-month period was driven by costs for the GCAR GBM AGILE Study, which commenced patient recruitment in January 2021. The significant decrease in net loss was due to a one-time, non-cash $16.1 million charge for acquired in-process R&D in the prior year194195201 Liquidity and Capital Resources The company's liquidity declined for the nine months ended March 31, 2022, with increased operating cash burn and reduced financing, raising substantial doubt about its going concern Cash Flow Summary for the Nine Months Ended March 31 (in thousands) | Cash Flow Activity | 2022 | 2021 | | :--- | :--- | :--- | | Cash flows from operating activities | $(15,400) | $(14,171) | | Cash flows from investing activities | — | $964 | | Cash flows from financing activities | $13,702 | $26,533 | - Financing activities in the nine months to March 31, 2022, included $13.6 million in net proceeds from a registered direct financing in September 2021. This compares to $21.6 million from a Series C Preferred stock placement in the prior-year period203204 - The company had $8.8 million in cash as of March 31, 2022. Despite raising an additional $7.9 million in April 2022, management has concluded there is substantial doubt about the company's ability to continue as a going concern for more than one year without securing additional funding206 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 as the company qualifies as a smaller reporting company214 Controls and Procedures The company's disclosure controls and procedures were effective as of March 31, 2022, with no material changes in internal control over financial reporting - Management concluded that as of the end of the period covered by this report, the company's disclosure controls and procedures were effective215 - There were no changes in internal control over financial reporting during the quarter ended March 31, 2022, that have materially affected, or are reasonably likely to materially affect, internal controls217 PART II - OTHER INFORMATION Legal Proceedings The company is not currently involved in any legal proceedings - There are no legal proceedings the Company is party to or any of its property is subject to220 Risk Factors No material changes to previously disclosed risk factors were reported since the last Form 10-K and Form 10-Q filings - No material changes to risk factors were reported since the last Form 10-K and Form 10-Q filings221 Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities or use of proceeds - The company reported no unregistered sales of equity securities222 Defaults Upon Senior Securities The company reported no defaults upon senior securities - The company reported no defaults upon senior securities223 Mine Safety Disclosures This item is not applicable to the company's operations - This item is not applicable to the company224 Other Information The company reported no other material information - The company reported no other information225 Exhibits This section lists exhibits filed with the Form 10-Q, including financing agreements and officer certifications - Exhibits filed include forms of securities purchase agreements and warrant certificates related to the April 2022 financing, as well as required CEO and CFO certifications227
Kintara Therapeutics(KTRA) - 2022 Q3 - Quarterly Report