Anixa Biosciences, Inc. — FY2020 Form 10-K
Reporting period: Fiscal year ended October 31, 2020. This annual filing compares FY2020 with FY2019; it does not provide a separate Q4 results summary.
Business context
Anixa is an early-stage biotechnology company developing oncology and infectious-disease therapeutics and vaccines. Its principal programs are ovarian-cancer CAR-T therapy, breast- and ovarian-cancer vaccines, and discovery-stage COVID-19 antivirals. The company has not generated revenue from its therapeutic or vaccine programs.
On July 2, 2020, Anixa redirected resources to therapeutics and vaccines and suspended Anixa Diagnostics’ operations and development of its Cchek cancer-diagnostics platform. Limited legacy patent licensing and encrypted-conferencing activities continued.
Financial results and liquidity
| Metric | FY2020 / October 31, 2020 | FY2019 / October 31, 2019 |
|---|---|---|
| Revenue | $0 | $250,000 |
| Research and development expense | $4.381 million | $5.473 million |
| General and administrative expense | $5.597 million | $5.663 million |
| Operating loss | $9.978 million | $11.890 million |
| Net loss | $10.092 million | $11.819 million |
| Net loss attributable to common stockholders | $10.018 million | $11.647 million |
| Basic and diluted loss per share | $0.45 | $0.59 |
| Cash, cash equivalents and short-term investments | $9.057 million | $5.842 million |
| Working capital | $8.180 million | Not stated here |
FY2020 operating cash use was $6.176 million, versus $4.741 million in FY2019. Investing activities used $0.306 million; financing activities provided $9.407 million, mainly from at-the-market stock sales. Anixa raised approximately $9.266 million net by issuing 3,854,305 shares through ATM offerings. Outstanding shares were 24.249 million at year-end, compared with 20.332 million a year earlier; 26.077 million were outstanding on January 7, 2021.
Total assets were $9.453 million and current liabilities were $1.189 million at October 31, 2020. The filing lists no borrowings; liabilities principally comprised accounts payable, accrued expenses and a $55,198 operating-lease liability. No operating margin is meaningful given the absence of revenue. Accumulated deficit was $191.836 million.
Material changes and operating developments
- Net loss narrowed by about $1.726 million year over year, largely alongside lower R&D and G&A costs and the absence of FY2019 patent amortization and impairment charges. FY2020 also included a $148,000 loss on disposal of property and equipment after the diagnostics program was suspended.
- R&D spending fell about $1.092 million. FY2020 spending included approximately $2.455 million on the suspended diagnostics program, $1.048 million on CAR-T, $510,000 on antiviral research and $368,000 on cancer vaccines.
- The breast-cancer vaccine IND was submitted in November 2020; the FDA authorized a Phase 1a trial in December 2020. The company anticipated readiness to treat the first enrolled patient in spring 2021.
- Anixa expected to submit the CAR-T ovarian-cancer IND in Q1 2021, with a human trial potentially starting as early as mid-2021, subject to FDA authorization. In November 2020 it also licensed Cleveland Clinic ovarian-cancer vaccine technology.
- The COVID-19 program screened more than 1.2 billion compounds computationally. More than 30 potential compounds were identified; selected compounds were being synthesized and tested. These were discovery-stage candidates, not demonstrated treatments.
Outlook, risks and unusual items
Management stated, based on information available January 7, 2021, that existing cash, short-term investments and expected cash flows were expected to fund operations for the next 12 months. This is not a guarantee: the company reported ongoing losses, no recurring revenue, and a need for future financing. Additional equity financing could dilute shareholders; the ATM program remained available.
Management expects no near-term revenue from current therapeutic or vaccine programs and anticipates pursuing partnerships or eventual licensing to commercialize technologies. Development, clinical-trial and regulatory outcomes are uncertain. The company depends on collaborators and third parties, and warns that competition, patient enrollment, manufacturing, safety, intellectual-property and funding risks could delay or prevent progress. COVID-19 restrictions had disrupted laboratory and service-provider capacity and slowed development.
FY2020 included no patent-assertion costs or patent amortization. The company had no material pending litigation disclosed, other than lawsuits it brings to enforce patent rights. It reported effective disclosure controls and management-assessed effective internal control over financial reporting; the auditor did not attest to internal-control effectiveness under the company’s exemption.
Key facts for investors to verify
- Whether cash burn and operating costs remain consistent with management’s stated 12-month funding expectation, and whether additional financing is needed.
- Progress, timing and costs of the breast-vaccine Phase 1a trial and the planned CAR-T IND submission and trial.
- Whether COVID-19 compounds show reproducible biological activity and advance beyond discovery-stage testing.
- The scale of dilution from ATM sales, equity awards and other potentially issuable shares.
- License obligations, collaboration commitments and any subsequent changes to clinical timelines or COVID-19-related operating disruptions.