Financial Performance - In 2023, the company reported an operating loss of $11,457,061, a decrease from the operating loss of $27,525,431 in 2022, reflecting a reduction in operating expenses [302]. - The company had no revenue for the years ended December 31, 2023 and 2022, with no immediate sales prospects [303]. - The company reported a net loss of approximately $11.1 million for the year ended December 31, 2023, with an accumulated deficit of approximately $75.4 million [317]. - Net cash used in operating activities was $8,063,346 for the year ended December 31, 2023, compared to $9,605,143 in 2022, reflecting ongoing clinical trial costs [321]. Research and Development - Research and development costs decreased by $5.7 million to $5,799,518 in 2023, down from $11,494,230 in 2022, primarily due to the completion of the PCS12852 clinical trial and the termination of the PCS499 trial [305]. - The company completed its Phase 2A trial for PCS12852 in gastroparesis patients with positive results in 2023 [299]. - The company plans to conduct IND-enabling and toxicology studies for NGC-Iri in 2024-2025, targeting various cancers [299]. - The estimated annual newly diagnosed incidence rate for breast, colorectal, and other cancers relevant to NGC-Cap is greater than 250,000 patients per year [299]. Capital and Funding - The company raised gross proceeds of $7.0 million from a public offering on January 30, 2024, with net proceeds of $6.3 million intended for continued research and development for NGC-Cap [301]. - The company anticipates needing to raise additional capital in early 2025 to fund operations and continue the development of NGC drugs [307]. - Cash and cash equivalents totaled $4.7 million as of December 31, 2023, with an additional $6.3 million raised in January 2024 from a public offering [316]. - The company has an effective shelf registration statement on file with the SEC, providing flexibility to raise capital through public or private equity offerings [319]. Expenses and Impairments - General and administrative expenses decreased by $3.1 million to $5,657,543 for the year ended December 31, 2023, compared to $8,763,058 in 2022, primarily due to a reduction in employee stock-based compensation [311]. - The company recognized an impairment of $7.3 million for the PCS499 intangible asset, reducing its value to zero, due to slow patient enrollment and the decision to terminate the clinical trial [313]. - Stock-based compensation expense is recognized over the requisite service period based on estimated grant-date fair value, with no expense recognized for performance-vesting conditions until probable [335]. Tax and Deferred Assets - A valuation allowance equal to the full recorded amount of net deferred tax assets has been maintained, indicating that benefits from these assets are unlikely to be realized [337]. - The company does not expect to generate income tax benefits or expenses in the foreseeable future due to anticipated net operating losses [337]. - No unrecognized tax benefits were recorded as of December 31, 2023, indicating no liability, interest, or penalties required [338]. Other Financial Information - Net other income increased to $335,541 for the year ended December 31, 2023, compared to $101,202 in 2022, primarily driven by interest income [314]. - The company raised net proceeds of $6.4 million from the sale of common stock during the year ended December 31, 2023 [324]. - Prepaid expenses included $570,000 for advanced payments made to the CRO for the NGC-Cap clinical trial as of December 31, 2023 [310]. - Payments made to third parties in advance of services are recorded as prepaid expenses until the services are rendered [334].
Processa Pharmaceuticals(PCSA) - 2023 Q4 - Annual Report