Theriva Biologics, Inc. (filing issuer: Synthetic Biologics, Inc.) — Form 10-Q summary
Reporting period: Quarter and nine months ended September 30, 2019; filed November 4, 2019. The filing identifies the registrant as Synthetic Biologics, Inc., not Theriva Biologics, Inc.
Business context
The company was a clinical-stage biotechnology business developing microbiome-focused therapies. Its lead programs were SYN-004 (ribaxamase), SYN-010 for IBS-C, and earlier-stage SYN-020. It reported no product revenue and expected losses to continue pending successful trials and regulatory approvals.
Financial performance and position
Amounts are in millions of dollars except per-share data. Revenue and operating margins are not meaningful because no revenue is reported.
| Metric | Q3 2019 | Q3 2018 | Nine months 2019 | Nine months 2018 |
|---|---|---|---|---|
| General and administrative expense | $1.10 | $1.47 | $3.30 | $4.53 |
| Research and development expense | $4.14 | $2.85 | $9.16 | $9.79 |
| Operating loss | $(5.24) | $(4.32) | $(12.45) | $(14.31) |
| Net loss | $(5.15) | $(3.69) | $(12.24) | $(10.23) |
| Net loss attributable to common stockholders | $(5.25) | $(3.74) | $(12.93) | $(10.38) |
| Basic and diluted loss per share | $(0.31) | $(0.93) | $(0.79) | $(2.73) |
| Operating cash used | Not separately stated for the quarter | $(10.27) | $(13.99) |
At September 30, 2019, cash and cash equivalents were $18.65 million, down from $28.92 million at December 31, 2018. Current assets were $19.84 million and current liabilities $5.63 million (about 3.5x current-asset coverage). Total liabilities were $6.17 million, including $0.78 million in operating lease liabilities; the filing reports no outstanding debt. Stockholders’ equity was $2.09 million, and accumulated deficit was $232.39 million.
Material changes versus comparable periods
- Q3 operating costs rose 21% year over year: R&D increased 46%, primarily from SYN-020 manufacturing and toxicology work and SYN-010 study costs; G&A fell 26%, mainly from lower stock compensation and consulting and investor-relations costs.
- Nine-month operating costs declined 13%, reflecting lower G&A and lower R&D indirect costs, partly offset by SYN-020 development spending. Nine-month net loss increased, in part because 2018 included $4.06 million of noncash warrant fair-value income, versus none in 2019.
- Cash used in operations fell to $10.27 million from $13.99 million, while cash declined by $10.27 million in 2019. The 2018 period included $6.42 million of ATM proceeds; no ATM shares were sold in 2019.
- Common shares outstanding increased to 16.81 million from 15.48 million at year-end 2018. Series B preferred conversions resulted in $0.59 million of deemed dividends during the first nine months of 2019.
Outlook, risks and contingencies
- Management said $17.6 million of cash available in early November 2019 was expected to fund operations through at least Q4 2020, including the ongoing SYN-010 study, a potential SYN-004 specialty-population study, and SYN-020 preclinical work. This is management’s estimate, not a guarantee.
- The company said available resources would not fund planned registrational or later-stage trials. A SYN-004 Phase 3 program and future SYN-010 and SYN-020 trials would require substantial additional financing or partnerships. Financing availability and acceptable terms were uncertain; failure to raise funds could delay, reduce, or stop development.
- Management anticipated a SYN-010 Phase 2b data readout in the first half of 2020, after enrollment extended beyond the prior timeline because of higher-than-expected screen failures. It anticipated a SYN-004 Phase 1b/2a study at Washington University beginning in Q1 2020, subject to FDA alignment and institutional review board approval, and an SYN-020 IND filing in Q1 2020.
- Potential dilution, limits on ATM and other registered securities sales, clinical and regulatory uncertainty, and dependence on partners or future capital are key risks. The company reported no material litigation, no off-balance-sheet arrangements, and effective disclosure controls.
Investor facts to verify
- Confirm the issuer identity: this 10-Q is filed by Synthetic Biologics, Inc.; the request metadata names Theriva Biologics, Inc.
- Check subsequent cash balances, operating burn, financing activity, and whether the stated Q4 2020 runway estimate was achieved.
- Verify the actual timing and results of the SYN-010 study, SYN-004 clinical plans, and SYN-020 IND submission against the filing’s anticipated milestones.
- Assess potential dilution and conversion or exercise overhang from Series B preferred stock and outstanding warrants; the filing lists 18.92 million warrants outstanding.
- Review the full filing for detailed preferred-stock terms, lease commitments, and restrictions affecting additional securities sales.