Actinium Pharmaceuticals, Inc. — Q1 2018 Form 10-Q
Reporting period: Three months ended March 31, 2018; filed May 10, 2018. Unaudited results. Actinium is a clinical-stage biopharmaceutical company developing antibody radio-conjugate therapies. It has not generated revenue.
Financial performance and liquidity
| Metric | Q1 2018 | Q1 2017 / prior period |
|---|---|---|
| Revenue | $0 | $0 |
| Research and development expense | $4.46 million | $4.57 million |
| General and administrative expense | $1.88 million | $3.21 million |
| Total operating expenses | $6.35 million | $7.81 million |
| Net loss | $6.31 million | $8.06 million |
| Basic and diluted loss per share | $0.07 | $0.14 |
| Net cash used in operating activities | $5.46 million | $5.37 million |
| Cash, cash equivalents and restricted cash at period end | $27.19 million | $17.09 million |
At March 31, cash and cash equivalents were $26.76 million, with $0.43 million in restricted cash. Current assets were $27.65 million and current liabilities were $6.39 million. Total liabilities were $6.39 million; the balance sheet reports no debt. No meaningful revenue or profit margin is reported because there was no revenue and the company incurred a loss.
Management stated that cash on hand was expected to fund operations through the next 12 months. The company reported $14.87 million of financing cash inflow in Q1, primarily from its March equity offering. Cash used in investing activities was $7,000.
Changes versus Q1 2017
- Net loss narrowed by about 22%, and total operating expenses declined by about 19%. Lower G&A—attributed mainly to lower stock-option expense and bonus timing—drove most of the improvement.
- R&D expense decreased slightly: lower Actimab-A costs were largely offset by higher Iomab-B costs.
- Operating cash use was broadly similar year over year, increasing from $5.37 million to $5.46 million.
- Loss per share improved to $0.07 from $0.14, while weighted-average shares increased to 88.43 million from 55.89 million.
Outlook, developments and risks
- Iomab-B was in a pivotal Phase 3 trial for older patients with relapsed or refractory AML. The company said FDA guidance indicated that a successful single pivotal SIERRA study could support a BLA submission.
- Actimab-A was in Phase 2; Actimab-M was in Phase 1. The company planned additional trials, including Actimab-A with CLAG-M, with enrollment expected to begin in 2018, and a Phase 2 high-risk MDS trial.
- In March, Actinium entered a research and option collaboration with Astellas to develop actinium-225 radio-conjugates and conduct preclinical validation. Payments under the agreement are accounted for as reductions to R&D expense; the filing does not state a payment amount.
- The March financing sold 30.24 million common shares with Series A and B warrants for approximately $15.1 million gross proceeds; the note reports approximately $13.9 million net proceeds after specified offering expenses. Warrants had exercise prices of $0.60 and $0.70. At quarter-end, 55.90 million warrants were outstanding.
- Key risks include clinical-trial and regulatory failure, ongoing cash burn and future financing needs, manufacturing and isotope supply, and dependence on intellectual-property protection and potential partners. The company said no material risk-factor changes occurred during the quarter.
- There were no reported legal proceedings or material off-balance-sheet arrangements. Management concluded disclosure controls were effective and reported no material change in internal control over financial reporting.
Important facts for investors to verify
- Whether the Phase 3 SIERRA trial progresses as planned and supports the anticipated regulatory pathway.
- Whether management’s stated 12-month cash runway remains adequate given ongoing clinical and manufacturing spending.
- The full dilution and potential proceeds associated with 55.90 million outstanding warrants, alongside the substantial increase in common shares issued.
- The terms, milestones and potential economics of the Astellas collaboration; no payment amounts are specified in this filing.
- Contractual and contingent commitments, including remaining Goodwin manufacturing costs of approximately $1.8 million and milestone or royalty obligations under license agreements.