Greenwich LifeSciences, Inc. — Q1 2022 Form 10-Q
Reporting period: Three months ended March 31, 2022. Greenwich is a clinical-stage biopharmaceutical company developing GLSI-100 (GP2 plus GM-CSF), an immunotherapy intended to prevent breast cancer recurrence. It had no product revenue.
Financial performance and position
| Metric | Q1 2022 | Q1 2021 / comparison |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $1.661 million | $0.282 million; up 489% |
| General and administrative expense | $0.328 million | $0.319 million; up 3% |
| Total operating expenses | $1.989 million | $0.601 million |
| Net loss | $1.970 million | $0.597 million |
| Basic and diluted loss per share | $0.15 | $0.05 |
| Net cash used in operating activities | $1.947 million | $0.528 million |
| Cash at period end | $19.743 million | $27.204 million at December 31, 2021 |
| Total assets | $19.755 million | $27.217 million at December 31, 2021 |
| Total liabilities | $0.241 million | $0.385 million at December 31, 2021 |
The company reported no investing cash flows in either quarter. Financing used $5.514 million in Q1 2022, primarily for share repurchases; Q1 2021 financing provided net cash of $2.273 million. The filing reports no revenue or profit margin; margins are not meaningful for this pre-revenue business. No borrowings or debt balance is reported in the presented balance sheet.
Material changes and notable items
- R&D expense rose substantially, mainly due to higher cash compensation, clinical, and manufacturing costs. Management attributed the increased quarterly net loss primarily to those cost increases.
- The company repurchased and cancelled 269,828 shares for approximately $5.514 million, reducing cash and equity. The board indefinitely suspended the buyback on March 15, 2022, after authorizing a program of up to $10 million.
- Common shares issued and outstanding were 12,951,453 at March 31, 2022; the cover reports 13,000,357 as of May 19, 2022.
Outlook, risks, and contingencies
- Flamingo-01, the planned Phase III trial, had not commenced. The FDA had placed the trial on clinical hold pending updated manufacturing information. The company said it submitted the information and was awaiting FDA comments; the protocol and trial details remained under discussion and subject to change.
- Management expects continued significant expenses and operating losses as it develops its pipeline, prepares for clinical trials, and builds operating capabilities. The company expects to need additional capital and said future equity or debt financing is not assured. It did not provide a quantified cash runway or financial guidance.
- Management cited a completed Phase IIb study in which no recurrences were observed among qualifying GLSI-100-treated patients in the HER2/neu 3+ adjuvant setting after a median five-year follow-up, subject to the described treatment and follow-up conditions. It also reported that treatment was well tolerated across 146 patients treated in four trials, with no related serious adverse events observed.
- Manufacturing and clinical-trial obligations, the GP2 license, and employment and shareholder agreements were identified as commitments. The company reported no material legal proceedings and no off-balance-sheet arrangements.
- Disclosure controls were deemed ineffective at March 31, 2022 because of material weaknesses involving inadequate segregation of duties and insufficient written accounting, IT, and financial-reporting procedures. Management said it was developing a remediation plan. The company reported no material change in internal control during the quarter.
- The filing reported no material changes to the risk factors in the 2021 Form 10-K. It cautioned that forward-looking statements are subject to risks and uncertainties.
Important facts for investors to verify
- Current FDA status of the clinical hold, acceptance of manufacturing data, and timing and final design of Flamingo-01.
- Expected clinical, manufacturing, and operating cash needs, and whether additional financing will be required and available.
- Progress and effectiveness of remediation of the disclosed control weaknesses.
- Reconciliation of the March 31 share count with the May 19 cover-page share count.
- Future license, manufacturing, and clinical-trial commitments, which may increase as development advances.