Panbela Therapeutics(PBLA) - 2023 Q2 - Quarterly Report

PART I Financial Statements The company's financial statements reflect a significant increase in cash and total assets as of June 30, 2023, primarily due to financing activities, while still experiencing substantial net losses. Condensed Consolidated Balance Sheets As of June 30, 2023, total assets increased to $19.6 million from $5.0 million at year-end 2022, driven by a rise in cash and cash equivalents to $7.2 million. Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2023 (Unaudited) | December 31, 2022 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $7,205 | $1,285 | | Total current assets | $10,809 | $1,777 | | Total assets | $19,551 | $4,978 | | Liabilities & Equity | | | | Total current liabilities | $10,555 | $7,833 | | Total liabilities | $14,749 | $13,027 | | Total stockholders' equity (deficit) | $4,802 | $(8,049) | Condensed Consolidated Statements of Operations and Comprehensive Loss For the three and six months ended June 30, 2023, the company reported net losses of $5.8 million and $11.0 million, respectively, a significant reduction from 2022 primarily due to a non-recurring IPR&D write-off. Statement of Operations Highlights (in thousands) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $4,234 | $20,028 | $7,750 | $22,236 | | Operating loss | $(5,877) | $(21,286) | $(10,745) | $(25,289) | | Net loss | $(5,833) | $(22,130) | $(10,952) | $(25,796) | | Basic and diluted net loss per share | $(7.95) | $(1,843.68) | $(22.08) | $(2,243.10) | Condensed Consolidated Statements of Stockholders' (Deficit) Equity Stockholders' equity improved from a $8.0 million deficit at the start of 2023 to a positive $4.8 million by June 30, 2023, driven by $23.1 million from common stock sales. - Proceeds from the sale of common stock in the first half of 2023 amounted to $15.4 million in Q1 and $7.7 million in Q2[15] - The accumulated deficit increased from $91.1 million at the beginning of the year to $102.0 million by June 30, 2023, due to ongoing net losses[15] Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2023, net cash used in operating activities was $15.5 million, offset by $21.4 million from financing activities, resulting in a $5.9 million increase in cash. Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(15,492) | $(8,680) | | Net cash used in investing activities | $0 | $(655) | | Net cash provided by financing activities | $21,412 | $0 | | Net change in cash | $5,920 | $(9,337) | - Financing activities in H1 2023 included $23.1 million in proceeds from the sale of common stock and warrants, net of offering costs, and $1.65 million in principal payments on notes[20] Notes to Condensed Consolidated Financial Statements The notes detail the company's business, significant accounting policies, and financial condition, highlighting its focus on therapeutics, substantial doubt about its going concern ability, and reliance on capital raises. - The company's lead candidates are ivospemin (SBP-101), Flynpovi™ (a combination of eflornithine and sulindac), and eflornithine (CPP-1X)[23] - The company has incurred losses of $102.0 million since its inception in 2011 and incurred a net loss of $11.0 million for the six months ended June 30, 2023, raising substantial doubt about its ability to continue as a going concern[26][27] - The company effected a 1-for-30 reverse stock split on June 1, 2023, and a 1-for-40 reverse stock split on January 13, 2023[24] - In July 2023, the company divested rights to its eflornithine pediatric neuroblastoma program and is entitled to receive up to approximately $9.5 million in milestone-based payments, with an initial payment of $400,000 received at closing[67] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's status as a clinical-stage biopharmaceutical firm, focusing on the development of its lead candidates, ivospemin and Flynpovi, and its ongoing need for additional capital despite recent financing. - The company's ASPIRE trial, a global randomized Phase II/III study for ivospemin in metastatic pancreatic cancer, had 52 sites open in 9 countries as of June 30, 2023, with full site activation expected by mid-2023[76][77] - The company regained North American rights to develop and commercialize Flynpovi for Familial Adenomatous Polyposis (FAP) in April 2023[84] - The company needs to raise additional capital to continue operations and execute its business plan beyond the third quarter of 2023[92] Results of Operations Comparison (in thousands) | Expense Category | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | Percent Change | | :--- | :--- | :--- | :--- | | General and administrative | $2,995 | $3,053 | -1.9% | | Research and development | $7,750 | $22,236 | -65.1% | | Total operating expenses | $10,745 | $25,289 | -57.5% | | Net Loss | $(10,952) | $(25,796) | -57.5% | Quantitative and Qualitative Disclosure About Market Risk The company is a smaller reporting company and is therefore not required to provide the disclosure requested under this item. - As a smaller reporting company, Panbela Therapeutics, Inc. is not required to provide disclosure pursuant to Item 3[118] Controls and Procedures Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2023, with no material changes to internal control over financial reporting. - The CEO and CFO concluded that as of June 30, 2023, the company's disclosure controls and procedures were effective[120] - No change in internal control over financial reporting occurred during the quarter that has materially affected, or is reasonably likely to materially affect, internal controls[121] PART II – OTHER INFORMATION Legal Proceedings The company reported no legal proceedings. - None[124] Risk Factors The company highlights the risk of being delisted from Nasdaq, despite regaining compliance with the minimum bid price requirement after a reverse stock split. - The company faced a potential delisting from Nasdaq for failing to meet the minimum $1.00 bid price requirement[126] - A 1-for-30 reverse stock split was effected on June 1, 2023, to address the bid price deficiency, and the company subsequently regained compliance on June 15, 2023[126] - A future delisting could severely harm the stock's liquidity, market price, and the company's ability to obtain financing[127][131] Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities The company reported no unregistered sales of equity securities, use of proceeds, or issuer purchases of equity securities for the period. - None[128] Defaults Upon Senior Securities The company reported no defaults upon senior securities. - None[128] Mine Safety Disclosures This item is not applicable to the company. - Not applicable[129] Other Information During the three months ended June 30, 2023, no director or officer of the company adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement. - No director or officer adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the quarter[130] Exhibits This section lists all exhibits filed with the Form 10-Q, including certificates of incorporation, bylaws, warrant agreements, securities purchase agreements, and officer certifications. - The report includes a list of exhibits filed, such as amendments to the Certificate of Incorporation, warrant agreements from the June 2023 offering, and required CEO/CFO certifications[133]