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Recently announced a $5.0 million raise in a private placement transaction led by a subsidiary of CBI Co., Ltd. ("CBI"), a member of a leading investment group in South Korea focusing on assisting scientific-based companies in South Korea and the United States
CHICAGO, May 16, 2022--(BUSINESS WIRE)--Exicure, Inc. (NASDAQ: XCUR), an early-stage biotechnology company focused on the development of next generation nucleic acid therapies targeting RNA to address both genetic and non-genetic neurological disorders and hair loss disorders, today reported financial results for the quarter ended March 31, 2022 and provided an update on its business strategy and corporate progress.
"Exicure is off to a promising start in 2022 as we have made progress with our preclinical SCN9A program for the treatment of pain with several potential therapeutic candidates identified and we are conducting initial in vivo animal studies to support candidate selection in 2023," commented Matthias Schroff, Ph.D., Chief Executive Officer of Exicure. "We continue to advance our partnered programs with Ipsen and AbbVie, and the recently announced private placement investment led by CBI USA, Inc. ("CBI USA") is expected to provide us with additional resources as we continue our mission to pursue treatments for patients with unmet medical needs," concluded Dr. Schroff.
Recent highlights include:
On May 10, 2022, Exicure announced a $5.0 million raise in a private placement transaction priced at market premium
Agreed to sell an aggregate of 26,021,011 shares of the Company’s common stock to certain accredited investors in a private placement in public equity ("PIPE") financing at a purchase price of $0.1937 per share, representing an approximately 45% premium to the 10-day volume weighted-average share price from May 9, 2022.
New investor CBI USA led the transaction; existing investor, Abingworth LLP, also participated.
Transaction is expected to close on or about May 19, 2022, subject to the satisfaction of customary closing conditions.
In connection with the PIPE, CBI USA received the right to nominate a member to the Company’s board of directors (the "Board"), effective as of the closing date. CBI USA will also have the right to designate one individual to attend all meetings of the Board in a nonvoting observer capacity.
Net proceeds from the transaction expected to support the Company’s advancement of its preclinical program, including the development of its SCN9A product candidate, as well as other working capital and general corporate purposes.
Corporate highlights for the first quarter of 2022 include:
Repaid in full all outstanding indebtedness and other obligations under the Company’s credit facility with MidCap, effective March 15, 2022.
Continued to advance the Company’s SCN9A preclinical discovery program. Exicure anticipates results from initial in vivo animal studies by year-end 2022, with the goal of therapeutic candidate selection in the second half of 2023.
Progressed work with partnered programs towards potential pre-clinical milestones in 2023.
Actively pursuing out-license opportunities for the Company’s clinical asset, cavrotolimod.
Continuing to pursue near-term partnering opportunities for pain and other neuroscience programs.
First Quarter 2022 Financial Results
Cash Position: Cash, cash equivalents and short-term investments were $27.6 million as of March 31, 2022, as compared to $48.3 million as of December 31, 2021. The Company expects that its cash and cash equivalents, together with the expected $5.0 million gross proceeds from the PIPE transaction in May 2022, will enable it to fund its current operations into the first quarter of 2023.
Revenue: Revenue was $2.6 million for the quarter ended March 31, 2022, reflecting an increase of $1.6 million from revenue of $1.0 million for the quarter ended March 31, 2021. The increase in revenue of $1.6 million is mostly due to the recognition of non-cash revenue of $2.1 million associated with the Company’s collaboration with Ipsen Biopharm Limited, partially offset by a decrease in revenue of $0.5 million associated with the Company’s collaboration with AbbVie Inc.
Research and Development (R&D) Expense: Research and development expenses were $7.1 million for the quarter ended March 31, 2022, as compared to $10.3 million for the quarter ended March 31, 2021. The decrease in R&D expense for the three months ended March 31, 2022 of $3.1 million reflects a reduction in employee headcount and fewer discovery, preclinical, and clinical program activities resulting from the restructuring activities that the Company announced in December 2021.
General and Administrative (G&A) Expense: General and administrative expenses were $3.2 million for the quarter ended March 31, 2022, as compared to $2.9 million for the quarter ended March 31, 2021. The increase in G&A expense of $0.3 million for the three months ended March 31, 2022 was mostly due to higher legal costs and retention award expense for current employees, partially offset by a decrease in recruiting costs, investor relations costs, and stock-based compensation.
Net Loss: The Company had a net loss of $8.3 million for the quarter ended March 31, 2022, as compared to a net loss of $12.5 million for the quarter ended March 31, 2021. The decrease in net loss was primarily driven by lower R&D expense and higher non-cash revenue during the period.
Going Concern: Given the Company’s current cash position, operating plans and forecasted negative cash flows from operating activities over the next twelve months, management believes there is substantial doubt regarding the Company’s ability to continue as a going concern within one year after the date that its unaudited condensed consolidated financial statements for the quarter ended March 31, 2022 are issued. The Company will require substantial additional financing to address the Company’s working capital and other financing needs to pursue its business strategy.
Exicure, Inc. is an early-stage biotechnology company developing nucleic acid therapies targeting ribonucleic acid against validated targets to neurological disorders and hair loss. The team includes a diverse scientific group with expertise in nucleic acid chemistry, drug development and neuroscience. Headquartered in Chicago, Illinois, the Company conducts its discovery and development efforts in-house with a dedicated 30,000 square foot facility, including rapid and automated high throughput nucleic acid synthesis and screening. For further information, see www.exicuretx.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this press release other than statements of historical fact may be deemed forward looking including, but not limited to: statements regarding the Company’s current business plans and objectives; the timing, use of proceeds and closing of the PIPE; the anticipated extension of cash runway due to the PIPE; the substantial doubt about the Company’s ability to continue as a going concern; the Company’s requirements for substantial additional financing to address the Company’s working capital and other financing needs; the Company’s anticipated cash runway; the Company’s ability to continue to advance its strategic partnerships and the potential achievement of any clinical trial milestones pursuant to such license and collaboration agreements; the continuation of pre-clinical discovery of potential therapeutic candidates and the ability to develop, and possibly partner, product candidates for the treatment of neurological conditions; the timing and development of the Company’s preclinical pipeline and achievement of expected near- and long-term milestones, including timing of results from initial in vivo animal studies and planned therapeutic candidate selection; the potential advantages and clinical benefit of the Company’s SNA platform and advancement of SCN9A preclinical discovery; the future prospects of the Company, including of the outlicensing of its cavrotolimod program. Words such as "plans," "expects," "will," "anticipates," "continue," "expand," "advance," "believes," " "target," "may," " "intend," "could," "should," and other words and terms of similar meaning and expression are intended to identify forward-looking statements, although not all forward-looking statements contain such terms. Forward-looking statements are based on management’s current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: market and other conditions; the Company’s ability to adequately finance its business and seek alternative sources of financing the risks that the ongoing COVID-19 pandemic may disrupt the Company’s business and/or the global healthcare system (including its supply chain) more severely than it has to date or more severely than anticipated; unexpected costs, charges or expenses that reduce the Company’s capital resources; the unproven approach of the Company’s SNA platform; the Company’s preclinical programs do not advance into clinical or result in approved products on a timely or cost effective basis or at all; the results of early clinical trials are not always being predictive of future results; the cost, timing and results of clinical trials; that many drug candidates do not become approved drugs on a timely or cost effective basis or at all; the ability to enroll patients in clinical trials; possible safety and efficacy concerns; regulatory developments; the ability of the Company to obtain or maintain its existing or future collaborations, licenses or contractual relationships and/or collaborate successfully with strategic partners; regulatory developments; exposure to litigation, including patent litigation, and/or regulatory actions; the ability of the Company to protect its intellectual property rights; and the impact of the completion of the Company’s previously reported internal investigation on the Company’s business and diversion of management time and attention on related issues, including any related investigations or proceedings, shareholder lawsuits, reputational harm, or the possibility that executives or other employees may resign. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. For a discussion of other risks and uncertainties, and other important factors, any of which could cause the Company’s actual results to differ from those contained in the forward-looking statements, see the section titled "Risk Factors" in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission on March 25, 2022, as updated by the Company’s subsequent filings with the Securities and Exchange Commission. All information in this press release is as of the date of the release, and the Company undertakes no duty to update this information or to publicly announce the results of any revisions to any of such statements to reflect future events or developments, except as required by law.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
Cash and cash equivalents
Prepaid expenses and other assets
Total current assets
Property and equipment, net
Other noncurrent assets
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of long-term debt
Accrued expenses and other current liabilities
Deferred revenue, current
Total current liabilities
Deferred revenue, noncurrent
Lease liability, noncurrent
Other noncurrent liabilities
Preferred stock, $0.0001 par value per share; 10,000,000 shares authorized, no shares issued and outstanding, March 31, 2022 and December 31, 2021
Common stock, $0.0001 par value per share; 200,000,000 shares authorized, 122,792,877 issued and outstanding, March 31, 2022; 108,783,144 issued and outstanding, December 31, 2021
Additional paid-in capital
Accumulated other comprehensive loss
Total stockholders' equity
Total liabilities and stockholders’ equity
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
Three Months Ended
Research and development expense
General and administrative expense
Total operating expenses
Other (expense) income, net:
Other expense, net
Total other expense, net
Net loss before provision for income taxes
Provision for income taxes
Basic and diluted loss per common share
Weighted-average basic and diluted common shares outstanding
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