markdown [PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Q1 2024 unaudited financials show a net loss of $4.2 million, increased cash to $19.5 million, and an accumulated deficit of $58.4 million [Unaudited Condensed Balance Sheets](index=3&type=section&id=Unaudited%20Condensed%20Balance%20Sheets) As of March 31, 2024, total assets were $19.7 million, liabilities decreased, and shareholders' equity increased to $14.0 million Condensed Balance Sheet Data (USD in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $19,464 | $19,126 | | TOTAL ASSETS | $19,714 | $19,185 | | **Liabilities & Equity** | | | | TOTAL LIABILITIES | $5,692 | $6,984 | | TOTAL SHAREHOLDERS' EQUITY | $14,022 | $12,201 | | TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $19,714 | $19,185 | [Unaudited Condensed Statements of Operations](index=4&type=section&id=Unaudited%20Condensed%20Statements%20of%20Operations) Q1 2024 net loss was $4.17 million, slightly higher than Q1 2023, driven by increased research and development expenses Condensed Statement of Operations (USD in thousands) | Account | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Research and development | $2,660 | $2,367 | | General and administrative | $1,736 | $1,734 | | **OPERATING LOSS** | **$(4,396)** | **$(4,101)** | | Finance income | $225 | $52 | | **NET LOSS** | **$(4,171)** | **$(4,049)** | | **BASIC AND DILUTED NET LOSS PER SHARE** | **$(0.25)** | **$(0.27)** | [Unaudited Condensed Statements of Changes in Stockholders' Equity](index=5&type=section&id=Unaudited%20Condensed%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Shareholders' equity increased to $14.0 million in Q1 2024, primarily due to ATM proceeds, partially offset by the net loss - Shareholders' equity increased by **$1.8 million** in Q1 2024[19](index=19&type=chunk) - The increase was primarily due to net proceeds of **$4.7 million** from the At-the-Market offering, which was offset by the quarterly net loss of **$4.2 million**[19](index=19&type=chunk) [Unaudited Condensed Statements of Cash Flows](index=7&type=section&id=Unaudited%20Condensed%20Statements%20of%20Cash%20Flows) Q1 2024 net cash increased by $0.3 million to $19.5 million, primarily from financing activities offsetting operating cash use Condensed Statement of Cash Flows (USD in thousands) | Activity | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(4,358) | $(4,777) | | Net cash provided by financing activities | $4,696 | $252 | | **INCREASE/(DECREASE) IN CASH** | **$338** | **$(4,525)** | | Cash and cash equivalents at end of period | $19,464 | $15,468 | [Notes to Unaudited Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) Key notes cover the accumulated deficit, cash sufficiency, ATM proceeds, and significant unaccrued contingent payment obligations - The company has an accumulated deficit of **$58.4 million** as of March 31, 2024, but management believes existing cash of **$19.5 million** is sufficient to fund planned operations for at least the next **12 months**[27](index=27&type=chunk)[29](index=29&type=chunk) - In Q1 2024, the company sold 502,647 common shares under its ATM Program, generating net proceeds of approximately **$4.7 million**[28](index=28&type=chunk)[48](index=48&type=chunk) - Potential future milestone and royalty payments under license agreements with CRT Pioneer Fund and the University of Edinburgh have not been accrued due to uncertainty[42](index=42&type=chunk)[44](index=44&type=chunk) - As of March 31, 2024, there was **$5.4 million** of total unrecognized compensation cost related to RSAs, expected to be recognized over a weighted average period of **1.32 years**[55](index=55&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=14&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses oncology drug candidates NXP800 and NXP900, Q1 2024 net loss of $4.2 million, $19.5 million cash, and future capital needs [Overview](index=15&type=section&id=Overview) Nuvectis develops precision oncology medicines, with lead candidate NXP800 in Phase 1b for ovarian carcinoma and NXP900 in Phase 1a for solid tumors - NXP800 is in a **Phase 1b** study for platinum-resistant, ARID1a-mutated ovarian carcinoma and has received FDA **Fast Track Designation**[69](index=69&type=chunk)[70](index=70&type=chunk) - NXP900 is a SRC/YES1 kinase inhibitor for which a **Phase 1a** study in patients with advanced solid tumors was initiated in September 2023[72](index=72&type=chunk)[74](index=74&type=chunk) [Results of Operations](index=17&type=section&id=Results%20of%20Operations) Q1 2024 operating loss was $4.4 million, driven by increased research and development expenses, resulting in a $4.2 million net loss Comparison of Operating Expenses (USD in thousands) | Expense Category | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | Change | | :--- | :--- | :--- | :--- | | Research and development | $2,660 | $2,367 | $293 | | General and administrative | $1,736 | $1,734 | $2 | | **OPERATING LOSS** | **$(4,396)** | **$(4,101)** | **$(295)** | - The increase in R&D expenses was primarily driven by a **$0.2 million** increase in employee compensation, including share-based compensation and benefits[82](index=82&type=chunk) [Liquidity and Capital Resources](index=21&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2024, the company had $19.5 million in cash, sufficient for 12 months, but substantial additional capital will be required - The company had **$19.5 million** in cash and cash equivalents as of March 31, 2024[85](index=85&type=chunk) - Management believes current cash will fund operating expenses and capital expenditures through at least the next **12 months** from the financial statement issuance date[90](index=90&type=chunk) - As of March 31, 2024, the company has sold shares for **$9.8 million** in net proceeds under its ATM program, with approximately **$29.9 million** remaining available for sale[89](index=89&type=chunk)[49](index=49&type=chunk) [Contractual Obligations and Other Commitments](index=24&type=section&id=Contractual%20Obligations%20and%20Other%20Commitments) The company has significant contingent milestone and royalty payment obligations under its NXP800 and NXP900 license agreements - NXP800 License Agreement: Potential payments include up to **$22.0 million** in pre-approval milestones, up to **$178 million** in commercial milestones, and tiered royalties[104](index=104&type=chunk) - NXP900 License Agreement: Potential payments include up to **$45.0 million** in pre-approval milestones, up to **$279.6 million** in commercial milestones, tiered royalties, and **2.5%** of gross future fundraising up to **$3.0 million**[105](index=105&type=chunk)[106](index=106&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=20&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a **smaller reporting company**, Nuvectis is not required to provide market risk disclosures - As a "**smaller reporting company**," Nuvectis is not required to provide quantitative and qualitative disclosures about market risks[112](index=112&type=chunk) [Item 4. Controls and Procedures](index=21&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were **effective** as of March 31, 2024, with **no material changes** to internal controls - Based on an evaluation as of March 31, 2024, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were **effective**[114](index=114&type=chunk) - There were **no changes** in internal controls over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, internal control[115](index=115&type=chunk) [PART II - OTHER INFORMATION](index=22&type=section&id=PART%20II%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=22&type=section&id=Item%201.%20Legal%20Proceedings) The company was **not a party to any material legal matters or claims** as of the report date - The company was **not a party to any material legal matters or claims** as of the date of the report[118](index=118&type=chunk) [Item 1A. Risk Factors](index=22&type=section&id=Item%201A.%20Risk%20Factors) **No material changes** to risk factors were reported compared to the Annual Report on Form 10-K for fiscal year 2023 - **No material changes** to risk factors were reported compared to the Annual Report on Form 10-K for the year ended December 31, 2023[119](index=119&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=22&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) **No unregistered securities** were issued, and the use of proceeds from prior offerings for drug development and general corporate purposes remains **unchanged** - **No unregistered securities** were issued during the reporting period[120](index=120&type=chunk) - The intended use of proceeds from offerings is to fund Phase 1 development of NXP800 and NXP900 and for general corporate purposes, with **no material change** in this plan[123](index=123&type=chunk)[124](index=124&type=chunk) [Item 3. Defaults Upon Senior Securities](index=22&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) **No defaults** upon senior securities were reported [Item 4. Mine Safety Disclosures](index=22&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations [Item 5. Other Information](index=22&type=section&id=Item%205.%20Other%20Information) No other material information was reported [Item 6. Exhibits](index=23&type=section&id=Item%206.%20Exhibits) The report includes required exhibits such as **CEO and CFO certifications** and **Inline XBRL financial statements** - Filed exhibits include **CEO and CFO certifications** and **Inline XBRL financial data**[128](index=128&type=chunk)
Nuvectis Pharma(NVCT) - 2024 Q1 - Quarterly Report