Immix Biopharma, Inc. — Q3 2022 Form 10-Q
Reporting period: Three and nine months ended September 30, 2022; filed November 9, 2022. Immix is a clinical-stage biopharmaceutical company developing therapies for cancer and inflammatory diseases. It reported no operating revenue and operates as one business segment.
Key financial metrics
| Metric | Q3 2022 / September 30, 2022 | Comparable period / prior balance |
|---|---|---|
| Revenue | None generated | None generated |
| Operating expenses | $1.53 million for the quarter; $4.42 million for nine months | Quarter: $0.35 million; nine months: $0.75 million |
| Net loss | $1.54 million for the quarter; $4.43 million for nine months | Quarter: $0.40 million; nine months: $1.63 million |
| Loss per share, basic and diluted | $0.11 for the quarter; $0.32 for nine months | Quarter: $0.12; nine months: $0.48 |
| Cash and current assets | Cash: $16.92 million; current assets: $17.39 million | December 31, 2021 cash: $17.64 million; current assets: $18.19 million |
| Operating cash used | $3.50 million for nine months | $0.48 million |
| Financing cash provided | $2.81 million for nine months | $0.13 million |
| Debt and liabilities | No note payable; total liabilities $0.65 million | December 31, 2021 note payable $0.05 million; total liabilities $0.20 million |
| Stockholders’ equity | $16.75 million | December 31, 2021: $17.99 million |
Margins are not meaningful because the company had no revenue. Accumulated deficit was $34.19 million at September 30, 2022.
Changes versus the prior comparable period
- Operating expenses and net loss rose substantially, primarily from increased research and development spending on the ongoing Phase 1b/2a clinical trial and higher general and administrative costs, including professional services, officer salaries, and stock-based compensation.
- Nine-month R&D expense increased to $1.93 million from $0.12 million; nine-month G&A expense increased to $2.49 million from $0.64 million.
- Operating cash use increased to $3.50 million from $0.48 million. The company received $2.91 million net from the IPO underwriters’ over-allotment exercise in January 2022.
- Prior-year nine-month results included a $0.74 million loss from remeasurement of a derivative liability and $0.14 million of interest expense; these items were largely absent in 2022. The prior-year period also had a much lower weighted-average share count, so per-share comparisons reflect substantial share-count changes.
Outlook, risks, and unusual items
- Management said cash on hand was expected to fund planned operations through at least November 9, 2023. The company expects continuing losses and negative operating cash flows, needs additional capital, and has no credit facility or committed financing source.
- Management expects R&D spending to increase as product development expands. Funding needs depend on trial progress and results, manufacturing, regulatory work, staffing, and other factors. Additional financing may dilute shareholders or require the company to surrender rights; unavailable financing could force program delays, reductions, or termination.
- The company is conducting an ongoing Phase 1b/2a clinical trial. Clinical success, regulatory approval, commercialization, and future product revenue are uncertain; the filing gives no financial guidance or specific revenue forecast.
- Disclosure controls and procedures were reported as ineffective because of a material weakness in financial reporting controls, including insufficient formal processes and detailed review of accounting transactions. Remediation steps, including accounting consultants, had been implemented, but were not in place long enough to demonstrate remediation.
- After quarter-end, the company amended compensation arrangements for its CEO and CFO, increasing each annual base salary to $425,000 retroactive to January 1, 2022, with discretionary performance bonuses of up to 50% of base salary. The Board also authorized options for up to 250,000 shares for each executive.
- The company repurchased 37,418 shares for $55,963 during the nine months. Its repurchase program authorized up to $1 million; $944,037 remained available at September 30, 2022. No shares were repurchased during Q3.
- No material pending litigation was reported. A royalty agreement could require payments on certain future product sales; none had been paid or accrued through September 30, 2022.
Most important facts for investors to verify
- Whether the stated cash runway remains adequate as clinical-trial costs and operating cash use evolve, and whether additional financing will be required.
- Clinical trial progress, costs, and results, including the timing and implications of any new clinical or regulatory disclosures.
- Whether the company remediates the disclosed material weakness and reports that controls have operated effectively over a sufficient period.
- The effects of executive compensation and outstanding options and warrants on future expenses, dilution, and governance.
- Any changes in repurchase activity, royalty obligations, or other material commitments.