PDS Biotechnology Corporation — Q1 2021 Form 10-Q
Reporting period: Three months ended March 31, 2021. PDS is a clinical-stage immunotherapy and vaccine developer using its Versamune platform. It had no commercially approved products and generated no product revenue.
Financial results and position
| Metric | Q1 2021 | Q1 2020 / comparison |
|---|---|---|
| Revenue | None | None |
| Research and development expense | $1.41 million | $1.97 million, down 28% |
| General and administrative expense | $1.64 million | $2.06 million, down 21% |
| Total operating expenses | $3.05 million | $4.03 million, down 24% |
| Net loss | $3.05 million | $3.99 million, improved 23% |
| Basic and diluted loss per share | $0.14 | $0.39 |
| Net cash used in operating activities | $3.80 million | $3.16 million |
| Cash and cash equivalents at period end | $25.04 million | $28.84 million at Dec. 31, 2020 |
Expense reductions reflected lower professional services and clinical study costs in R&D, and lower professional services costs in G&A, partly offset by higher personnel costs. Operating cash use increased by $0.6 million, primarily due to prepaid expenses related to the Syneos CRO contract. Interest income was negligible. Margins are not meaningful because the company had no revenue.
Total assets were $27.76 million and stockholders’ equity was $24.37 million at March 31, 2021. Total liabilities were $3.39 million, including $0.58 million of operating lease obligations; the filing reports no debt borrowings. The company reported $46.83 million of accumulated deficit. Cash declined by $3.80 million during the quarter; there were no financing proceeds in Q1 2021.
Business developments, outlook, and risks
- PDS0101 trials included an actively recruiting Phase 2 study with KEYTRUDA for HPV16-positive recurrent or metastatic head and neck cancer, an NCI-led triple-combination study, and a Phase 2 study with chemo-radiotherapy for locally advanced cervical cancer. The NCI-led study met its initial safety benchmark and the company reported reaching a preliminary response objective in checkpoint-inhibitor-naive patients; assessment in an added refractory cohort was ongoing.
- The company was developing additional oncology candidates and infectious-disease vaccines, including PDS0202 for influenza and PDS0203 for COVID-19. Brazil’s science ministry committed to fund up to approximately $60 million for PDS0203 development and commercialization, subject to available public funds and regulatory and trial milestones. The pre-IMPD package was under Anvisa review; a combined Phase 1/2 trial was anticipated to start by year-end 2021.
- Management expected operating losses to continue and R&D spending to increase as programs advanced. It believed available cash and projected resources were sufficient to fund operations and R&D for at least 12 months from the report date, but said further financing may be needed. Equity financing could dilute shareholders; debt could impose repayment obligations and restrictive covenants.
- COVID-19 had delayed two PDS0101 trials and affected clinical-trial enrollment and operations. Further disruptions, including site staffing, travel, monitoring, and regulatory access, could delay development. The company said the pandemic’s future financial and operational effects remained uncertain.
- The filing reported no material changes to previously disclosed risk factors, no material legal proceedings, and no material non-cancelable purchase commitments. Management concluded disclosure controls were effective.
Important facts for investors to verify
- Whether clinical-trial enrollment, safety, and efficacy results support continued development of PDS0101 and other candidates.
- Whether the Brazilian funding commitment for PDS0203 becomes available, and the timing and regulatory conditions attached to it.
- Cash burn and runway relative to management’s at-least-12-month estimate, including the expected increase in development spending.
- Availability and terms of future financing, including potential dilution under the shelf registration statement or other equity issuance.
- Whether COVID-19 or other operational and regulatory constraints further delay trials or vaccine development.