RenovoRx(RNXT) - 2021 Q3 - Quarterly Report

Clinical Trials and Research - RenovoRx has completed Phase 1/2 studies in locally advanced pancreatic cancer, showing a median overall survival rate of 27.9 months compared to the historical control of 12-15 months[112] - RenovoGem is currently being evaluated in a Phase 3 registration IND clinical trial, with interim data expected in the second half of 2022[112] - RenovoRx plans to expand its clinical trials, including a planned trial for hilar cholangiocarcinoma (HCCA) and potentially other indications[112] - The ongoing COVID-19 pandemic has negatively impacted clinical studies, including challenges in recruiting subjects for trials[119] - Clinical trial expenses are accrued based on estimates from service providers regarding work performed, including patient enrollment and study completion[162] Financial Performance - As of September 30, 2021, RenovoRx reported cash and cash equivalents of $17.7 million and an accumulated deficit of $18.9 million[114] - The company incurred net losses of $1.5 million and $4.0 million for the three and nine months ended September 30, 2021, respectively[114] - The net loss for the three months ended September 30, 2021 was $1.5 million, representing a 38% increase from a net loss of $1.1 million in the prior year[135] - The net loss for the nine months ended September 30, 2021 was $4.0 million, a 36% increase from a net loss of $2.9 million in the prior year[141] - Cash used in operating activities for the nine months ended September 30, 2021 was $4.0 million, compared to $2.9 million for the same period in 2020, reflecting a 38% increase in net loss[155] Operating Expenses - For the three months ended September 30, 2021, total operating expenses increased by 53% to $1.4 million compared to $0.9 million in the same period of 2020[135] - Research and development expenses for the three months ended September 30, 2021 were $0.8 million, a 6% increase from $0.7 million in the prior year quarter[136] - General and administrative expenses surged by 243% to $0.6 million for the three months ended September 30, 2021, compared to $0.2 million in the same period of 2020[137] - For the nine months ended September 30, 2021, total operating expenses rose by 29% to $3.3 million compared to $2.6 million in the same period of 2020[141] - The company expects to continue incurring significant operating losses and negative cash flows from operations for the foreseeable future[114] - The company expects to incur additional losses and increased operating expenses in future periods[148] Funding and Capital Structure - RenovoRx completed its IPO in August 2021, raising gross proceeds of $16.7 million, with net proceeds of $14.6 million after deducting underwriting discounts and expenses[113] - Net cash provided by financing activities for the nine months ended September 30, 2021 was $19.3 million, a significant increase from $2.7 million in the same period of 2020, representing a 615% increase[157] - As of September 30, 2021, the company had no contractual obligations or other commitments, with $5.3 million in convertible notes converted to common shares upon IPO completion[158] Company Status and Outlook - The company is classified as an "emerging growth company" and will remain so until the earlier of December 31, 2026, or achieving total annual gross revenues of at least $1.07 billion[170] - The company has not generated any revenue from product sales and does not expect to do so for several years[121] - The company has not experienced any material impact from inflation on its business, financial condition, or results of operations during the nine months ended September 30, 2021[180] Interest and Currency Management - Interest expense, net for the nine months ended September 30, 2021 was $0.8 million, a 135% increase from $0.4 million in the same period of 2020[144] - The fair value of cash and cash equivalents would not be significantly affected by interest rate changes, as the interest rates for the 2020 and 2021 Convertible Notes were fixed[178] - The company has not engaged in hedging foreign currency transactions to date but may evaluate the costs and benefits of such a program in the future[179] Stock-Based Compensation - Stock-based compensation is recognized over a vesting period of generally four years, with fair value calculated using the Black-Scholes option pricing model[163] Off-Balance Sheet Arrangements - The company had no off-balance sheet arrangements during the periods presented[175]