Actinium Pharmaceuticals, Inc. — Q3 2021 Form 10-Q
Business context and reporting period. Actinium is a clinical-stage biopharmaceutical company developing antibody radiation-conjugates for cancer. This unaudited report covers the three and nine months ended September 30, 2021; financial amounts below are in U.S. dollars. The company had no revenue from commercial product sales.
Financial performance and liquidity
| Metric | Q3 2021 | Q3 2020 | Nine months 2021 | Nine months 2020 |
|---|---|---|---|---|
| Total revenue | $0.233 million | $0 | $1.121 million | $0 |
| Research and development expense, net | $4.708 million | $3.788 million | $12.615 million | $11.446 million |
| General and administrative expense | $1.994 million | $1.825 million | $5.422 million | $4.512 million |
| Net loss | $6.423 million | $5.540 million | $16.764 million | $15.835 million |
| Basic and diluted loss per share | $(0.30) | $(0.36) | $(0.84) | $(1.46) |
| Cash used in operations | Not stated for quarter | Not stated for quarter | $15.814 million | $15.359 million |
- Other revenue comprised a government research grant and collaboration research services; the company reported $0.9 million from collaborations and $0.2 million from the grant for the nine-month period. Revenue recognition depends on the research services and collaboration modules.
- At September 30, cash and cash equivalents were $82.032 million; restricted cash was $0.440 million. Total current assets were $83.261 million and current liabilities were $4.190 million.
- Total liabilities were $4.194 million, primarily accounts payable and accrued expenses and lease obligations. The balance sheet reports no borrowings; lease liabilities totaled approximately $0.421 million.
- Cash, cash equivalents and restricted cash increased $18.473 million during the nine months. Financing provided $34.420 million, primarily from common-stock sales; the company sold 4.5 million shares under its equity sales agreement for $34.5 million net proceeds.
Material changes versus the prior comparable period
- Nine-month net loss increased by $0.929 million, as higher R&D and G&A expenses were partly offset by $1.121 million of other revenue.
- Nine-month R&D expense rose $1.169 million, mainly from additional hiring, laboratory research and grant-related activities, partly offset by lower CD33 program costs. G&A increased $0.910 million, primarily from higher professional fees.
- Operating cash use increased by $0.455 million. Financing cash inflow was lower than in 2020, when the company completed two larger offerings of common stock and pre-funded warrants.
- Shares outstanding increased from 17.5 million at December 31, 2020 to 22.0 million at September 30, 2021. The weighted-average share count also increased substantially year over year, helping explain why nine-month loss per share improved despite the higher net loss.
Outlook, management commentary, risks and unusual items
- Management stated that existing resources were expected to fund planned operations for more than 12 months from the November 12, 2021 filing date. The company nevertheless warned that additional capital may be needed and could dilute shareholders.
- The pivotal Phase 3 SIERRA trial of Iomab-B completed enrollment of 150 patients in September 2021. Management expected to present interim data at ASH in December 2021, top-line durable complete remission data in mid-2022, and, assuming supportive results, to file a BLA toward the end of 2022. These are forward-looking expectations, not reported outcomes.
- The Iomab-ACT CAR-T conditioning study had begun enrolling patients; proof-of-concept data were expected in 2022. Actimab-A combination trials were ongoing, and the company described CD47 combination work as preclinical.
- Key risks include clinical-trial failure or delay, regulatory approval uncertainty, continued operating losses, future financing and dilution, reliance on third-party clinical and manufacturing providers, isotope supply, and intellectual-property protection. The Ac-225 supply agreement with the Department of Energy was due for renewal annually and then extended through year-end 2021.
- COVID-19 had not caused a significant operational delay or financial impact to date, according to the company, but potential effects on trials, suppliers, regulators and access to capital remained uncertain. Management reported effective disclosure controls and procedures; no material change in internal control over financial reporting was reported. The filing reported no legal proceedings.
Most important facts for investors to verify
- Whether SIERRA’s final results support the expected regulatory filing timeline and whether the FDA requires additional evidence or studies.
- Cash burn, operating-cost growth and the adequacy of the stated greater-than-12-month funding runway, including the potential for further equity issuance and dilution.
- Status and renewal of Ac-225 supply, availability of other isotope sources, and the company’s dependence on third-party manufacturing and clinical-trial providers.
- Progress, safety and results in Iomab-ACT and Actimab-A combination trials; distinguish preliminary or interim findings from final, fully reviewed clinical data.
- The durability and terms of collaboration revenue, and whether it continues; reported revenue to date was not commercial product revenue.