MyMD Pharmaceuticals, Inc. — Q1 2022 Form 10-Q
Reporting period: Three months ended March 31, 2022; financial statements are unaudited. MyMD is a clinical-stage biopharmaceutical company developing MYMD-1 and Supera-CBD. It reported no product revenue in either Q1 2022 or Q1 2021.
Key financial results
| Metric | Q1 2022 | Q1 2021 |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $2.63 million | $1.35 million |
| Administrative expense | $1.40 million | $1.08 million |
| Operating loss | $4.12 million | $3.09 million |
| Net loss | $4.12 million | $3.09 million |
| Basic and diluted loss per share | $0.11 | $0.11 |
| Cash used in operating activities | $2.37 million | $1.51 million |
No gross margin was reported because there was no product revenue. R&D and administrative expenses increased 94.7% and 29.4%, respectively; total operating expenses and net loss increased 33.4% year over year. R&D growth reflected development-program and regulatory costs, including work on Phase 2 study design and protocols.
Balance sheet and liquidity
- At March 31, 2022, cash and cash equivalents were $1.19 million and marketable securities were $8.00 million, versus $0.56 million and $11.00 million, respectively, at December 31, 2021.
- Working capital was $7.61 million; total assets were $22.20 million, total liabilities $2.58 million, and shareholders’ equity $19.62 million. Accumulated deficit was $82.68 million.
- Operating cash outflow was partly offset by a $1.43 million increase in trade and other payables. Investing activities provided $3.00 million, mainly from marketable-security sales; financing activities provided no cash.
- The balance sheet reports no conventional notes payable. Lease liabilities totaled approximately $133,000; trade and other payables were $2.42 million. The filing also reports $29,982 due to former MyMD Florida shareholders.
Business, outlook, and material risks
- MYMD-1 is being evaluated in a Phase 2 trial for sarcopenia and frailty, while the filing also describes development for autoimmune and age-related conditions. Supera-CBD is an earlier-stage synthetic cannabidiol analog; its preclinical genotoxicity studies were completed in February 2022.
- Management said available resources were expected to fund the current operating budget and contractual obligations for 12 months from issuance of the statements. Management expected financing before September 30, 2022; if financing was not completed by then, it planned to slow clinical activity and defer other costs to extend operations by about six months. This is management’s assessment, not a financing commitment or revenue forecast.
- The company remains dependent on additional funding and has no product sales. Clinical development, regulatory approval, commercialization, and future financing are uncertain; equity financing may dilute shareholders.
- Management reported delays in receiving clinical supplies from a manufacturer in India and difficulty recruiting trial participants. The filing cautions that COVID-19 could further disrupt operations, trials, third parties, and access to capital.
- A second whistleblower-retaliation action brought by Raymond Akers was filed in March 2022 after an earlier complaint was dismissed. The company said it believed the new action was without merit.
- The company held a 13% interest in Oravax and rights to a 2.5% royalty on future net sales under the disclosed arrangement; it was evaluating options for its Oravax interest, including a possible shareholder distribution.
- Potential merger-related share milestone payments depend on market-capitalization thresholds during the 36-month period after the April 2021 merger. The filing also describes equity awards, warrants, and other potential dilution.
Important facts for investors to verify
- Actual cash runway, quarterly cash burn, and whether financing was completed by management’s stated September 30, 2022 target.
- Current MYMD-1 Phase 2 enrollment, study progress, supply availability, and any updated clinical timelines; also the development plan and funding needs for Supera-CBD.
- Subsequent changes in marketable securities, payables, lease commitments, and any new debt or equity issuance.
- Developments in the Raymond Akers litigation, Oravax plans, and any milestone or royalty obligations or proceeds.
- Potential dilution from outstanding options, restricted stock units, warrants, preferred stock, and merger-related contingent consideration.