Immix Biopharma, Inc. — Q1 2023 Form 10-Q
Reporting period: Three months ended March 31, 2023; unaudited. Immix is a clinical-stage biopharmaceutical company with ImmixBio focused on solid tumors and immune-dysregulated diseases and majority-owned Nexcella focused on cell therapies. The company reported no operating revenue and operates as one business segment.
Financial performance and liquidity
| Metric | Q1 2023 | Q1 2022 |
|---|---|---|
| Revenue | None reported | None reported |
| General and administrative expense | $1.20 million | $0.70 million |
| Research and development expense | $1.32 million | $0.63 million |
| Operating loss | $2.52 million | $1.33 million |
| Net loss | $2.50 million | $1.33 million |
| Net loss per share, basic and diluted | $0.18 | $0.10 |
| Cash used in operating activities | $2.09 million | $1.49 million |
| Cash and cash equivalents, March 31 | $11.46 million | $19.06 million |
At March 31, 2023, total current assets were $13.03 million and current liabilities were $1.47 million; total assets were $13.21 million and stockholders’ equity was $11.74 million. The balance sheet reported no borrowings or other debt. The company had an accumulated deficit of $40.46 million. No operating margin is meaningful because the company had no revenue.
Changes and financing
- Net loss increased by approximately $1.17 million year over year, primarily as G&A and R&D expenses rose. Management attributed higher G&A to professional services, officer salaries and stock compensation, and higher R&D to ongoing clinical trials, CRO and patient-related costs.
- Cash declined by $1.97 million during Q1 2023. Financing activities provided $118,916 net, including proceeds from the company’s ATM sales and Nexcella share sales, offset by deferred offering costs. In Q1 2022, financing provided $2.91 million, principally from the IPO over-allotment.
- The March 2023 ATM agreement permits up to $5 million of common-stock sales and carries a 3.75% sales commission. The company sold 50,000 shares for $103,916 net proceeds during Q1. After quarter-end, it sold 1,084,281 shares for $2.51 million net; by May 11, total ATM net proceeds were $2.61 million. Common shares outstanding were 15,033,103 on May 11.
Outlook, risks and notable items
- Management said cash on hand and funds that may be raised under the ATM should fund planned operations through at least May 12, 2024. This is not a guarantee; the company has recurring losses and negative operating cash flow, has not generated operating revenue, and states it needs additional capital. The filing raises substantial financing and going-concern risks.
- No formal revenue or earnings guidance was provided. Management expects significant expenses and operating losses to continue as it advances candidates through research and clinical development.
- Nexcella’s CAR-T license entails approximately $13 million in additional quarterly payments through September 2026, a $50,000 annual license fee, 5% royalties on net sales and sales milestones of up to $20 million. Nexcella also committed to fund clinical trials in Israel over four years at an estimated total cost of approximately $13 million.
- Disclosure controls and procedures were deemed ineffective due to a material weakness in internal financial controls, attributed to limited personnel and insufficiently formal processes, including journal-entry processing and review. Management said it was working on remediation, including adding accounting consultants.
- The filing reports no material pending litigation and no material changes to the risk factors previously disclosed in the 2022 Form 10-K. Clinical, regulatory, intellectual-property, third-party-dependence and financing risks remain significant.
- After quarter-end, the company amended its CEO and CFO compensation arrangements, increasing each officer’s annual base salary to $446,000, effective January 1, 2023.
Key facts for investors to verify
- Whether cash use and clinical-development spending remain consistent with management’s stated runway, and what additional financing may be required.
- ATM share sales, remaining authorization, net proceeds after commissions and expenses, and resulting shareholder dilution.
- Progress, costs and payment obligations for ImmixBio and Nexcella clinical programs, particularly the Nexcella CAR-T license and Israel trial commitments.
- Remediation of the material weakness and effectiveness of financial-reporting controls in subsequent filings.
- Potential future revenue, royalty or milestone obligations and the timing and likelihood of regulatory and commercial milestones; the filing provides no clear revenue outlook.