NanoViricides Has Filed Quarterly Report for Period Ending March 31, 2020 - Has Sufficient Cash, Progress on New Coronavirus Drug Program and the Lead HerpeCide(TM) Drug Candidate IND Application
SHELTON, CT / ACCESSWIRE / June 23, 2020 / NanoViricides, Inc. (NYSE American:NNVC) (the "Company") a global leader in the development of highly effective antiviral therapies based on a novel nanomedicines platform (the "Company"), has filed its quarterly report for its third quarter of financial year 2020 with the Securities and Exchange Commission. The Company had requested a COVID-19-related extension to file the quarterly report. This press release should be read in conjunction with the Form 10-Q filed on June 22, 2020. The submission can be downloaded from the SEC website at: https://www.sec.gov/Archives/edgar/data/1379006/000110465920075651/0001104659-20-075651-index.htm.
The Company reported that it had approximately $6.44 Million (M) of current assets (cash, cash equivalents, and prepaid expenses), and current cash liabilities of approximately $1.14M excluding a recent mortgage (described below), as of March 31, 2020, the end of the reporting period. The net cash used in operating activities during the nine months period was approximately $5.11M. The Company's expenditures were in line with budget estimates. Shareholder equity stood at approximately $14.31M for the quarter (unaudited figures), primarily due to the asset value of its cGMP-capable manufacturing facility, R&D labs, and equipment, that it owns fully except for a $2 Million secured debt provision, and the net proceeds of the equity raise completed on or about January 22, 2020. The Company had no revenues. The Company has no long-term debt.
Previously, the Company drew down $1.1M from a $2M non-convertible loan commitment secured by a mortgage on the Company's facility provided by the Company's founder and President, Anil R. Diwan, PhD., in December 2019. The mortgage is payable in full on March 31, 2021, with no payments due until then. Interest is payable only on amounts drawn by the Company.
The Company has previously reported that it has raised approximately $8.625M in gross proceeds in an underwritten public offering, pursuant to an effective Form S-1 registration statement, comprising the sale of 2.5 million shares plus 375,000 shares of an underwriters over-allotment option at a price of $3 per share, with no warrants issued in the transaction, that closed on or about January 22, 2020. Aegis Capital Corp. acted as sole bookrunner for the offering. The net proceeds to the Company after underwriter's commission and agreed upon customary fees and expenses were approximately $7.78 million, before deducting the Company's legal and accounting expenses related to the Offering.
The Company has previously reported on May 22, 2020, that it had raised approximately $10.22M in gross proceeds in a registered direct offering of 1,400,000 shares (the "Shares") of the Company's common stock, par value $0.001 per share at the purchase price of $7.30 per share. No warrants were issued in this offering. Maxim Group LLC and Kingswood Capital Markets, a division of Benchmark Investments, Inc. acted as placement agents in connection with this Offering. The net proceeds to the Company from this offering were approximately $9.3 million after placement agent fees and other estimated offering expenses payable by the Company.
With these cash inflows, the Company believes its balance sheet is now strong and the Company has sufficient funding for its planned expenditures for the ensuing year, based on estimated budgets including costs of certain clinical trials.
The Company has previously reported that it is working on developing a therapeutic drug for the treatment of the novel coronavirus 2019-nCoV, a/k/a COVID-19. In 2014, the Company had engaged in drug discovery efforts against MERS coronavirus. The Company had reported in a press release on January 20, 2020, that it has already found broad-spectrum virus-binding ligands that are expected to attack the virus at the same points that the virus uses to bind to its cognate cellular receptor, namely ACE-2 (angiotensin converting enzyme type 2), using molecular modeling based on known SARS-CoV and ACE2 interactions. COVID-19 shares significant similarity with, and uses the same cellular receptor as, SARS-CoV.
On May 12, 2020, the Company announced that it has developed drug candidates against coronaviruses that have demonstrated very high anti-viral effectiveness in cell culture studies against multiple coronaviruses. Two of the tested nanoviricides drug candidates were highly effective in cell culture assays against multiple coronaviruses that infect humans. The Company has tested its drug candidates for anti-viral effectiveness against two distinctly different, unrelated coronaviruses that cause human disease, namely HCoV-NL63, and HCoV-229E. The assays evaluated the reduction caused by the drug candidate in cell death upon viral infection, formally known as cytopathic effects (CPE) assays. In particular, some of the tested nanoviricide drug candidates were several-times more effective than favipravir (aka T-705), against the tested viruses. Favirpravir is a broad-spectrum nucleoside-like analog drug that is in clinical testing against SARS-CoV-2, originally developed by Fujifilm.
On May 19, 2020, the Company announced that strong effectiveness against infection by an ACE2-utilizing coronavirus in an animal model has been observed for the drug candidates it is developing against SARS-CoV-2 to treat COVID-19 spectrum of diseases. The Company is developing an animal model for coronavirus infection using hCoV-NL63 as a surrogate for SARS-CoV-2, the virus that causes COVID-19 disease. HCoV-NL63 is a circulating human coronavirus that causes a disease that is similar to SARS-CoV-2, but much milder. Both viruses utilize the same cell receptor, namely ACE2, to gain entry into the cell. Because it causes a mild disease, hCoV-NL63 can be used in BSL2 environments, and the Company believes it is a useful surrogate for development of therapeutics against SARS-CoV-2 infection.
In this lethal direct-lung-infection model, animals in all groups developed lung disease that later led to multi-organ failures, a clinical pathology resembling that of the SARS-CoV-2. Reduction in loss of body weight at day 7 was used as the primary indicator of drug effectiveness. Rats were infected directly into lungs with lethal amounts of HCoV-NL63 virus particles and then different groups were treated separately with five different nanoviricides drug candidates, remdesivir as a positive control, and the vehicle as a negative control. The treatment was intravenous by tail-vein injection once daily for five days, except it was twice daily in the case of remdesivir.
Animals treated with five different nanoviricides showed significantly reduced body weight loss. The body weight loss was only 3.9% for the best nanoviricide candidate, ranging to 11.2% for the potentially least effective one, as compared to 20% in the vehicle-treated control group, in female animals (n=5 in each group). Male animals treated with the same nanoviricides also showed significantly reduced body weight loss. The body weight loss in male animals was 8.0% for the best nanoviricide candidate and ranged up to 10.9% for the potentially least effective one, as compared to 25% in the vehicle-treated control group (n=5 in each group). In comparison, remdesivir treatment led to a body weight loss of 15.2% in females and 18.6% in males in this study (see below). Smaller numbers mean less loss in body weight compared to starting body weight in the group, and indicate greater drug effectiveness.
The strong effectiveness of nanoviricide drug candidates in this model is consistent with the effectiveness observed in cell culture studies against infection of both hCoV-NL63, which was used in this study, and hCoV-229E, another circulating coronavirus that uses a distinctly different receptor, namely APN.
Thus this animal study corroborated the cell-culture effectiveness reported by the Company and provides confidence to the Company that these nanoviricides drug candidates may be expected to result in a clinical candidate to be pursued in human clinical trials.
The Company believes the fact that these nanoviricides anti-coronavirus drug candidates are highly effective against two distinctly different coronaviruses that use different cellular receptors is very significant. Specifically, it provides a rational basis to scientists indicating that even if the SARS-CoV-2 coronavirus mutates, the nanoviricides can be expected to continue to remain effective. Antibodies and vaccines in general cannot be expected to remain effective if the virus undergoes genomic changes.
Importantly, nanoviricides are designed to act by a novel mechanism of action, trapping the virus particle like the "Venus-fly-trap" flower does for insects. Antibodies, in contrast, only label the virus for other components of the immune system to take care of. It is well known that the immune system is not functioning properly at least in severe COVID-19 patients.
Prior to filing for human clinical trials, the Company plans on conducting studies to further determine the effectiveness against SARS-CoV-2, perform drug development studies for safety/toxicology, and request a pre-IND Meeting with the US FDA for regulatory guidance.
The Company is developing a therapy or drug to combat the SARS-CoV-2 virus itself, for the treatment of infected patients, and not a drug that is designed for reducing clinical symptoms alone. The drug we are developing is not a vaccine, and does not have to be given to everyone, but will need to be given only to patients, if we can develop it successfully.
The Company has the capacity to produce several thousand doses of the potential drug at its cGMP-capable multi-purpose manufacturing facility in Shelton, CT, depending upon the treatment course. If our COVID-19 drug program produces positive results, then the Company anticipates obtaining assistance from US government and international agencies for further testing and potential exploratory clinical use to combat the epidemic. The Company does not at present have any active collaborations with US or international agencies for this purpose. The outbreak was declared a global emergency by the WHO on the same date as our announcement that we were working on therapeutics development against SARS-CoV-2, January 30, 2020, and has since turned into a global pandemic with devastating consequences around the world.
Subsequent to the reporting period, on June 8, 2020, the Company announced that it executed a Memorandum of Understanding ("MoU") with TheraCour Pharma, Inc. ("TheraCour") for a license for the research and development of anti-viral treatments for coronavirus derived human infections. The MoU also provides a limited license to the Company for the entire application of human coronavirus infections, while the full license is to be perfected by August 31, 2020. The Company is in the process of appointing a third party consulting firm for independent evaluation of this market space. Dr. Anil Diwan is recused from these discussions due to a conflict of interest.
Several coronaviruses have become endemic human pathogens, such as hCoV- 229E, NL63, OC43, and HKU1. These continually circulate in the human population and cause respiratory infections in adults and children world-wide. In contrast, SARS-CoV has caused only one well-known epidemic, with a mortality rate of about 9%, and MERS-CoV has caused repeated outbreaks, with mortality rates approaching 35%, but with limited number of cases. A broad-spectrum anti-coronavirus drug, such as a broad-spectrum nanoviricide that the Company is currently developing, could be potentially useful for treating most if not all of the different coronavirus infections that occur every year, and not just for coronavirus epidemics.
The Company has experience developing broad-spectrum cellular receptor mimetics as virus-binding ligands for creating nanoviricide drugs. The Company has demonstrated this capability notably in its HerpeCide™ program, wherein nanoviricides based on the same antiviral ligand were found to be effective against at least three different kinds of herpesviruses, namely herpes simplex-1 (HSV-1), herpes simplex-2 (HSV-2), and, surprisingly, the non-simplex varicella zoster virus (VZV).
The Company continues to advance its first drug candidate, namely NV-HHV-101 skin cream, for the treatment of shingles rash as its first indication, towards human clinical trials.
The Company is now in the process of writing and completing its first IND ("Investigational New Drug") application to the US FDA, which includes protocols for human clinical studies, with the help of its several regulatory consultants. This application covers the indication of the Company's drug, namely, NV-HHV-101 skin cream for the treatment of shingles rash, caused by VZV (varicella-zoster virus). The IND-enabling and required pre-clinical studies have been completed, and reports of almost all of the analyses of the samples resulting from these studies are being circulated between parties involved for completion. The Company is in the process of identifying and selecting appropriate partners and collaborators for the intended Phase1/2a human clinical studies for this drug candidate. The Company cannot project an exact date for filing an IND because of its dependence on a number of external collaborators and consultants, and the effects of recent COVID-19 restrictions.
The Company has undertaken cGMP manufacture of the drug product, namely, NV-HHV-101 skin cream, indicated for the topical treatment of shingles rash, for supplying anticipated Phase I human clinical trials at its own facility. The Company has industry-leading internal expertise in the cGMP manufacture of complex nanomedicines drugs, right from simple starting materials to formulated drug products.
In a human skin patch organ culture model ex vivo, the Company has previously demonstrated the effectiveness and safety of topical NV-HHV-101 against VZV, the cause of shingles and chickenpox. These studies were conducted by Professor Jennifer Moffat at the Upstate Medical Center, SUNY Syracuse, NY. Professor Moffat has developed this model for pre-clinical evaluation of therapeutics against VZV, and is a well-known expert in the field.
It is anticipated that the high effectiveness of our clinical drug candidate observed in this human skin model should be predictive of effectiveness in human clinical trials for topical dermal treatment of shingles.
NanoViricides is pioneering a unique platform for developing anti-viral drugs based on the "bind-encapsulate-destroy" principles. Viruses would not be able to escape a properly designed nanoviricide® drug by mutations because in doing so they would lose the ability to bind their cognate cellular receptor(s) and thus fail to infect productively, becoming incompetent.
NanoViricides, Inc. (www.nanoviricides.com) is a development stage company that is creating special purpose nanomaterials for antiviral therapy. The Company's novel nanoviricide® class of drug candidates are designed to specifically attack enveloped virus particles and to dismantle them. Our lead drug candidate is NV-HHV-101 with its first indication as dermal topical cream for the treatment of shingles rash. The Company is also developing drugs against a number of viral diseases including oral and genital Herpes, viral diseases of the eye including EKC and herpes keratitis, H1N1 swine flu, H5N1 bird flu, seasonal Influenza, HIV, Hepatitis C, Rabies, Dengue fever, and Ebola virus, among others. NanoViricides' platform technology and programs are based on the TheraCour® nanomedicine technology of TheraCour, which TheraCour licenses from AllExcel. NanoViricides holds a worldwide exclusive perpetual license to this technology for several drugs with specific targeting mechanisms in perpetuity for the treatment of the following human viral diseases: Human Immunodeficiency Virus (HIV/AIDS), Hepatitis B Virus (HBV), Hepatitis C Virus (HCV), Rabies, Herpes Simplex Virus (HSV-1 and HSV-2), Varicella-Zoster Virus (VZV), Influenza and Asian Bird Flu Virus, Dengue viruses, Japanese Encephalitis virus, West Nile Virus and Ebola/Marburg viruses. The Company has executed a Memorandum of Understanding with TheraCour that provides a limited license for research and development for drugs against human coronaviruses. The Company intends to obtain a full license and has begun the process for the same. The Company's technology is based on broad, exclusive, sub-licensable, field licenses to drugs developed in these areas from TheraCour Pharma, Inc. The Company's business model is based on licensing technology from TheraCour Pharma Inc. for specific application verticals of specific viruses, as established at its foundation in 2005.
This press release contains forward-looking statements that reflect the Company's current expectation regarding future events. Actual events could differ materially and substantially from those projected herein and depend on a number of factors. Certain statements in this release, and other written or oral statements made by NanoViricides, Inc. are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company's control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Important factors that could cause actual results to differ materially from the company's expectations include, but are not limited to, those factors that are disclosed under the heading "Risk Factors" and elsewhere in documents filed by the company from time to time with the United States Securities and Exchange Commission and other regulatory authorities. Although it is not possible to predict or identify all such factors, they may include the following: demonstration and proof of principle in preclinical trials that a nanoviricide is safe and effective; successful development of our product candidates; our ability to seek and obtain regulatory approvals, including with respect to the indications we are seeking; the successful commercialization of our product candidates; and market acceptance of our products. FDA refers to US Food and Drug Administration. IND application refers to "Investigational New Drug" application. CMC refers to "Chemistry, Manufacture, and Controls".
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