Theriva Biologics, Inc. — Filing Summary
Filing identity: The supplied filing is Synthetic Biologics, Inc.’s Form 10-Q for the quarter ended March 31, 2014, not a filing under the name Theriva Biologics, Inc. Verify that this is the intended filing before relying on the information below.
Business context and reporting period
The company describes itself as a development-stage biotechnology business focused on anti-infective and other drug candidates. Its programs included SYN-004 for prevention of C. difficile infection, SYN-010 for constipation-predominant irritable bowel syndrome (C-IBS), antibody programs for pertussis and Acinetobacter, Trimesta for multiple sclerosis (MS), and partnered flupirtine for fibromyalgia. The financial statements cover the three months ended March 31, 2014 and are unaudited.
Financial results and liquidity
| Metric | Q1 2014 | Q1 2013 / comparison |
|---|---|---|
| Revenue | No revenue reported | No revenue reported in the presented statement |
| Research and development expense | $2.717 million | $1.118 million |
| General and administrative expense | $1.122 million | $1.122 million |
| Operating loss | $3.839 million | $2.240 million |
| Net loss | $3.838 million | $2.228 million |
| Basic and diluted loss per share | $0.07 | $0.05 |
| Cash used in operating activities | $3.470 million | $1.662 million |
At March 31, 2014, cash and cash equivalents were $11.155 million, down from $14.625 million at year-end 2013. Current assets were $12.487 million and current liabilities were $0.773 million. Total liabilities were $0.773 million; the filing reports no debt balance. Accumulated deficit was $85.096 million. Cash used in investing activities was $4,000, while financing provided $4,000 from stock-option exercises. No cash interest or taxes were reported.
Changes versus the prior comparable period
- Research and development expense rose about 143%, primarily reflecting expanded research, development and manufacturing activity in the anti-infective pipeline, including C. diff, C-IBS and pertussis programs.
- Net loss increased by $1.610 million, while loss per share rose from $0.05 to $0.07. Weighted-average shares increased from 44.6 million to 58.3 million.
- Operating cash use increased by $1.808 million. Cash declined by $3.470 million during Q1 2014.
- Stock-option grants increased to 587,500 options from 117,500 in Q1 2013; the company reported approximately $1.4 million of grant-date fair value for Q1 2014 awards.
Outlook, commentary, risks and notable items
- Funding and going-concern risk: The company reported persistent operating cash outflows, an $85.1 million accumulated deficit, and no committed financing sources. It warned that it may need additional capital sooner or in greater amounts than expected; financing may be unavailable or dilutive, and inability to obtain funds could force it to curtail operations or development.
- Pipeline plans: Management intended to begin SYN-004 Phase Ia/Ib trials in the second half of 2014, with preliminary data expected by year-end; begin a SYN-010 Phase II trial in the second half of 2014, with topline data expected mid-2015; and pursue a pertussis Phase I trial in the first half of 2015. These are forward-looking targets, not reported achievements.
- Trimesta: The filing reports positive Phase II topline results announced in April 2014, including a 47% reduction in relapse rate at 12 months (p=0.03), a 32% reduction trend at 24 months (p=0.15), and improved cognitive scores at 12 months. Results were investigator-led; the company was assessing next steps and potential partners.
- Partner and grant support: UCLA’s Trimesta relapse-rate trial had received more than $8 million in grants, which the company said should fund follow-up through completion. The company also pledged approximately $500,000 over three years toward the cognitive-dysfunction trial.
- License commitments: The CSMC agreements include potential milestone, royalty and sublicense-revenue payments, as well as termination-fee provisions. The filing does not quantify all possible future payments.
- Other disclosures: The company reported no legal proceedings and no material change in its previously disclosed risk factors apart from the updates described. Management concluded disclosure controls were effective as of March 31, 2014, with no material change in internal control over financial reporting during the quarter.
Important facts for investors to verify
- Whether this Synthetic Biologics, Inc. 2014 filing is actually the intended filing for Theriva Biologics, Inc.
- Current cash runway and subsequent financing needs; the filing does not provide a clear runway estimate or committed financing.
- Whether the stated clinical-trial timelines were met and the results were confirmed in full study data.
- The status, funding obligations and potential economics of the CSMC, Intrexon, UCLA and Meda arrangements.
- The extent of potential dilution from outstanding options, warrants and future capital raises.