GLEN ROCK, NJ--(Marketwired - May 16, 2016) - RespireRx Pharmaceuticals Inc. (
Comments by Chief Executive Officer
James S. Manuso, Ph.D., President, Chief Executive Officer and Vice Chairman of RespireRx, commented, "We are pleased to report to our shareholders that the RespireRx team has accomplished a great deal during the first quarter of 2016, further laying the foundation for our growth going forward. Our Phase 2 trials, consisting of CX 1739 for opioid-induced respiratory depression and dronabinol for Obstructive Sleep Apnea, are on schedule to conclude and report results in the coming quarters. We have successfully raised additional capital to fund our operations and we are continuing our efforts to strengthen our balance sheet."
Dr. Manuso continued, "We are particularly concerned about the opioid epidemic in our country and we remain committed to addressing this problem with our Ampakine platform. Our current Phase 2A trial at Duke University is specifically designed to examine the ability of CX1739 to mitigate the respiratory depressant actions of an opioid, the primary cause of opioid lethality, without interfering with the pain management benefits of the opioid."
Dr. Manuso concluded, "We encourage those interested in learning more about the current clinical landscape for treating respiratory diseases to follow continuing developments at RespireRx."
Key corporate developments during the three months ended March 31, 2016 included the following:
- The Company commenced a Phase 2A human subject clinical trial testing the Company's lead oral compound, CX1739, for the prevention of respiratory depression caused by remifentanil, a potent opioid, while maintaining its desired analgesic effects.
- The Company raised aggregate gross proceeds of approximately $195,000 in several closings of a sale of units comprised of common stock and warrants ("2016 Unit Offering").
- The Company presented at and otherwise participated in a number of investor conferences.
Key subsequent events after March 31, 2016 included the following:
- The Company entered into exchange agreements with certain of its investors from its 2014 and 2015 Note and Warrant Offering and 2015 Unit Offering through which it restructured some of its outstanding securities. Funds raised from the Unit Exchange Agreements and the Note Exchange Agreements through May 13, 2016 aggregated $655,250. In addition, as a result of these transactions, the Company has eliminated from its balance sheet convertible notes inclusive of accrued interest of $344,493 with a face amount of $303,500, and reduced the number of shares of common stock issuable pursuant to outstanding warrants by 41,465,718 shares.
- An additional $55,000 was raised pursuant to the 2016 Unit Offering.
- All remaining Series G 1.5% Convertible Preferred Shares ("Series G Preferred Shares") were automatically and mandatorily redeemed via conversion into shares of common stock on April 17, 2016, resulting in no Series G Preferred Shares remaining outstanding.
Research and Development Overview
RespireRx is a leader in the development of medicines for respiratory disorders, holding exclusive licenses and owning patents and patent applications for certain families of chemical compounds that claim the chemical structures and their use in the treatment of a variety of disorders, as well as claims for novel uses of known drugs.
The Company has a pipeline of compounds in Phase 2 clinical development focused on developing drug treatments for a variety of different breathing disorders. Clinical development in the area of respiratory disorders, particularly drug-induced respiratory depression and sleep apnea, has created opportunities for the development and commercialization of the Company's compounds.
RespireRx's pharmaceutical candidates in development, which are derived from two platforms, are as follows:
- One platform of medicines being developed by RespireRx is a class of proprietary compounds known as ampakines, which act to enhance the actions of the excitatory neurotransmitter glutamate at AMPA glutamate receptors. Several ampakines, in both oral and injectable form, are being developed by the Company for the treatment of a variety of breathing disorders. In clinical studies, select ampakines have shown preliminary efficacy in central sleep apnea and in the control of respiratory depression produced by opioids, without altering the opioid analgesic effects. In animal models of orphan disorders, such as Pompe Disease, spinal cord damage and perinatal respiratory distress, it has been demonstrated that certain ampakines improve breathing function. The Company's compounds belong to a new class that does not display the undesirable side effects previously reported for other ampakines.
- The other platform is the class of compounds known as cannabinoids, including, in particular, dronabinol. Under a license agreement with the University of Illinois, the Company has rights to patents claiming the use of cannabinoids for the treatment of sleep-related breathing disorders. In a double-blind, placebo-controlled, dose-ascending Phase 2A clinical study conducted by the Company, dronabinol produced a statistically significant reduction in the Apnea-Hypopnea Index, the primary therapeutic end-point, and was observed to be safe and well-tolerated in a group of patients with Obstructive Sleep Apnea.
Information with respect to current clinical trials involving RespireRx's pharmaceutical candidates is as follows:
- The Company filed an Investigational New Drug ("IND") application with the U.S. Food and Drug Administration (the "FDA") in September 2015 to conduct a double-blind, placebo-controlled, dose-ascending Phase 2A clinical trial in approximately 18 subjects to determine the ability of orally administered CX1739, the Company's proprietary lead ampakine, to prevent the respiratory depression produced by remifentanil, a potent opioid, without altering remifentanil's analgesic properties. The clinical protocol was designed to evaluate the safety and efficacy of three escalating doses of CX1739 versus placebo when administered prior to remifentanil, with respiration, analgesia and a number of other clinical measures being taken after administration of both drugs. The commencement of this clinical trial was subject to resolution of two deficiencies raised by the FDA in its clinical hold letter issued in November 2015. These issues were satisfactorily resolved in early 2016, and the FDA removed the clinical hold on the Company's IND for CX1739 on February 25, 2016, thus allowing for the initiation of the clinical trial. During March 2016, upon receiving unconditional approval from the Institutional Review Board of the Duke Clinical Research Unit, this Phase 2A clinical trial at Duke University School of Medicine was initiated. The Company expects to complete the final data collection with respect to the clinical trial by the end of May 2016, and to issue a report on the results of the clinical trial during the third quarter of 2016.
- The University of Illinois and three other centers currently are investigating dronabinol in a potentially pivotal, six week, double-blind, placebo-controlled Phase 2B clinical trial in 120 patients with Obstructive Sleep Apnea. The University of Illinois has indicated that it expects the final data collection under this clinical trial to be completed in May 2016. The Company is not managing or funding this ongoing clinical trial. This clinical trial is fully funded by the National Heart, Lung and Blood Institute of the National Institutes of Health.
Financial Overview and Selected Financial Information
The Company incurred net losses of $2,680,951 and $727,952 for the three months ended March 31, 2016 and 2015, respectively, and negative operating cash flows of $343,300 and $200,403 for the three months ended March 31, 2016 and 2015, respectively. The Company expects to continue to incur net losses and negative operating cash flows for the next few years.
As a result of adjustments related to the Series G 1.5% Convertible Preferred Stock, the Company incurred net losses attributable to common stockholders of $2,681,932 and $731,150 for the three months ended March 31, 2016 and 2015, respectively, reflecting a net loss per share of $0.01 for 2016 and $0.00 for 2015.
At March 31, 2016, the Company had 498,622,133 shares of common stock outstanding, as compared to 489,846,883 shares of common stock outstanding at December 31, 2015. The exercise of all outstanding stock options and warrants, and the conversion of all outstanding convertible debt and equity securities, would have resulted in the issuance of an additional 699,518,827 shares of common stock.
Subsequent to March 31, 2016, the Company entered into various financing and exchange transactions to raise additional working capital and relieve short-term debt obligations, which included the exchange of $303,500 of the $579,500 principal amount of the 10% convertible notes due September 15, 2016. In addition, on April 17, 2016, the remaining unconverted 259.7 shares of Series G 1.5% Convertible Preferred Stock outstanding (including accrued but unpaid dividends) were automatically and mandatorily redeemed by conversion into 78,706,282 newly issued shares of common stock at a conversion price of $0.0033 per share.
At March 31, 2016, the Company had a working capital deficit of $3,838,542, as compared to a working capital deficit of $2,922,279 at December 31, 2015, reflecting an increase in the working capital deficit of $916,263 for the three months ended March 31, 2016. At March 31, 2016, the Company had cash aggregating $6,053, as compared to $53,199 at December 31, 2015, reflecting a decrease in cash of $47,146 for the three months ended March 31, 2016.
The Company is continuing its efforts to raise additional capital in order to be able to pay its liabilities and fund its business activities on a going forward basis, including a recent increase in the Company's research and development activities. The Company regularly evaluates various measures to satisfy the Company's liquidity needs, including developing agreements with collaborative partners and, when necessary, seeking to exchange or restructure the Company's outstanding securities. As a result of the Company's current financial situation, the Company has limited access to external sources of debt and equity financing. Accordingly, there can be no assurances that the Company will be able to secure additional financing in the amounts necessary to fully fund its operating and debt service requirements. If the Company is unable to access sufficient cash resources, the Company may be forced to discontinue its operations entirely and liquidate.
Additional information with respect to the Company's financial condition, results of operations, cash flows, capital structure and other matters involving the business, operations and research and development activities of the Company is included in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016, as filed with the U. S. Securities and Exchange Commission.
About RespireRx Pharmaceuticals Inc.
RespireRx Pharmaceuticals Inc. is a leader in the development of medicines for respiratory disorders, with a focus on sleep apneas and drug-induced respiratory depression. The Company holds exclusive licenses and owns patents and patent applications for certain families of chemical compounds that claim the chemical structures and their use in the treatment of a variety of disorders, as well as claims for novel uses of known drugs.
Additional information about the Company and the matters discussed herein can be obtained on the Company's website at www.RespireRx.com or in the Company's filings with the U.S. Securities and Exchange Commission at www.sec.gov.
Cautionary Note Regarding Forward-Looking Statements:
This press release contains certain 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 and we intend that such forward-looking statements be subject to the safe harbor created thereby. These might include statements regarding the Company's financial position, business strategy and other plans and objectives for future operations, and assumptions and predictions about future product demand, supply, manufacturing, costs, marketing and pricing factors are all forward-looking statements.
In some cases, forward-looking statements may be identified by words including "anticipates," "believes," "intends," "estimates," "expects," "plans," and similar expressions include, but are not limited to, statements regarding (i) future research plans, expenditures and results, (ii) potential collaborative arrangements, (iii) the potential utility of our proposed products, and (iv) the need for, and availability of, additional financing.
The forward-looking statements included herein are based on current expectations that involve a number of risks and uncertainties. These forward-looking statements are based on assumptions regarding our business and technology, which involve judgments with respect to, among other things, future scientific, economic and competitive conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the assumptions underlying the forward-looking statements are reasonable, actual results may differ materially from those set forth in the forward-looking statements. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.
Factors that could cause or contribute to such differences include, but are not limited to, regulatory policies or changes thereto, available cash, research and development results, competition from other similar businesses, and market and general economic factors. This press release should be read in conjunction with the condensed consolidated financial statements (unaudited) and notes thereto included in Item 1 of the Company's recently filed Quarterly Report on Form 10-Q and the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, including the section entitled "Item 1A. Risk Factors." The Company does not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.