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COCP: UPDATE: Cocrystal Pharma releases 2022 3rd quarter results and provides an update on the current pipeline programs.

By Thomas Kerr, CFA



Cocrystal Pharma (NASDAQ:COCP) reported 2022 3rd quarter results on November 14, 2022. General & Administrative expenses were $1.8 million and Research & Development expenses came in at $3.9 million for the quarter which was above our expectations. R&D spending is being ramped up for the influenza Phase 1 trial and the advancement of the preclinical Covid-19 program.

The company reported a net loss of ($5.7) million, or ($0.70) per diluted. Net cash used in operating activities for the first 9 months of 2022 was $16.5 million. There were no capital raises during the quarter from either the equity markets or debt financing.

The company’s unrestricted cash balance at quarter end was $42.0 million and total liabilities were only $1.7 million, none of which is considered traditional debt.

CFO and co-interim CEO Jim Martin stated, “The recent increase in patients hospitalized with viral disease particularly among the pediatric population underscores the need for effective, broad-spectrum antivirals and provides rationale for our approach in developing candidates with barriers to drug resistance. We continue to be well positioned to execute on our clinical and regulatory goals given our clean capital structure, cost-efficient business model and a cash balance we believe is sufficient to fund planned operations for the next three years. That said, we continue to pursue non-dilutive funding to further support development of our promising antiviral programs.”

On October 3rd, the company announced that its Board of Directors has approved a 1-for-12 reverse stock split for its common stock. Cocrystal’s common stock began trading on a split-adjusted basis on October 11, 2022. The reverse stock split will reduce the number of shares of common stock outstanding from approximately 97.5 million shares to approximately 8.1 million shares but will not change the authorized number of shares of common stock, which remains at 150 million shares of common stock.

The company’s current cash position of $42.0 million should be sufficient to fund their operations through the end of 2023, and possibly into 2024, depending on R&D spending levels and possible milestone payments from Merck.

We are adjusting our earnings estimate and valuation target based on higher than expected levels of R&D and the 1-12 reverse stock split. We estimate a 4th quarter EPS loss of ($0.73) and a full year loss of ($2.41). Our valuation target is adjusted to $9.15.

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