Matinas BioPharma Holdings, Inc. — Q1 2023 Form 10-Q
Reporting period: Three months ended March 31, 2023. Financial amounts below are in thousands of dollars, except per-share data. Matinas is a clinical-stage biopharmaceutical company developing products using its lipid nanocrystal (LNC) delivery platform. It had no approved products and no product-sales revenue.
Key financial metrics
| Metric | Q1 2023 | Q1 2022 / comparison |
|---|---|---|
| Revenue | $1,096 | $0 |
| Research and development expense | $3,970 | $4,978 |
| General and administrative expense | $2,712 | $2,744 |
| Total operating expenses | $6,682 | $7,722 |
| Operating loss | $(5,586) | $(7,722) |
| Net loss | $(5,513), or $(0.03) per share | $(5,978), or $(0.03) per share |
| Cash used in operating activities | $(4,087) | $(4,756) |
Contract research revenue came from the BioNTech collaboration and Genentech feasibility agreement; it is not product revenue. The filing does not report a gross margin. Q1 2022 included $1,734 from the sale of New Jersey net operating losses and tax credits; Q1 2023 had no such proceeds.
At March 31, 2023, cash and cash equivalents were $5,739 and marketable debt securities were $19,118, totaling $24,857; restricted cash was an additional $250. Current assets were $28,206 and current liabilities were $1,896. Total liabilities were $5,637, including operating and finance lease liabilities; the filing reports no borrowings. Stockholders’ equity was $32,625. The accumulated deficit was $158,144.
Changes versus the prior comparable period
- Revenue increased from zero to $1,096: $688 of BioNTech license-fee revenue, $375 for BioNTech research services, and completion of the remaining Genentech molecule obligation.
- R&D expense fell by $1,008, primarily because of lower manufacturing costs for clinical-trial materials, partly offset by higher compensation costs. G&A expense was broadly unchanged.
- Net loss narrowed by $465. The comparison reflects lower operating expenses and new collaboration revenue, while Q1 2022 had the $1,734 tax-credit sale proceeds and Q1 2023 did not.
- Operating cash use decreased by $669. Cash, cash equivalents and restricted cash declined by $1,091 during Q1 2023, versus a $1,702 decline in Q1 2022.
Outlook, management commentary and risks
- Management said existing cash, cash equivalents and marketable debt securities were expected to fund planned operations into the second half of 2024. It also expects significant expenses and operating losses for the foreseeable future and says additional financing will be needed.
- Management expected 2023 R&D and G&A expense to be relatively consistent with 2022, while noting that R&D spending may rise over time as development advances. It anticipated increased operating cash use during the remainder of 2023.
- Near-term priorities are MAT2203, an oral amphotericin B candidate being developed for serious fungal infections, and expansion of the LNC platform, including nucleic-acid applications. The company was seeking non-dilutive funding and FDA input on a potential additional Phase 3 study; the filing provides no firm trial timetable or formal financial guidance.
- Development of MAT2501 was paused after the company determined in Q4 2022 that continued development was not commercially reasonable. The company said it would not receive the remaining Cystic Fibrosis Foundation award and had no further obligations to the foundation.
- Key risks include clinical, regulatory and manufacturing uncertainty; dependence on third parties and licensed technology; the possibility of needing additional capital on unfavorable terms or being unable to obtain it; and potential dilution or reduced development activity. Product approval, commercialization and profitability are uncertain.
- The company reported no material changes to the risk factors in its 2022 Form 10-K, no legal proceedings, and no material changes in internal control over financial reporting. Management concluded disclosure controls were effective at the reasonable-assurance level.
Important facts for investors to verify
- Whether the stated cash runway into the second half of 2024 remains achievable as operating cash use and development plans evolve.
- MAT2203’s clinical and regulatory path, including the status of FDA discussions and potential Phase 3 funding and timing.
- Whether collaboration revenue recurs after recognition of the BioNTech fee and completion of the Genentech feasibility work.
- How the MAT2501 pause affects the pipeline and the company’s use of remaining Cystic Fibrosis Foundation funding.
- Future financing needs, potential equity dilution, and the maturity and liquidity profile of marketable debt securities.