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Genelux Corporation Reports Fourth Quarter and Full Year 2023 Financial Results and Provides Business Update

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Genelux (GNLX) reported fourth quarter and full year 2023 financial results, highlighting active enrollment in pivotal Phase 3 trials for platinum resistant ovarian cancer and advancements in lung cancer trials. The company holds $23.2 million in cash and investments. With ongoing clinical trials, Genelux aims to enhance cancer treatment options and offer hope to patients.
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  • Net loss increased significantly in 2023 compared to 2022, reaching $28.3 million for the year.
  • Research and development expenses rose due to new hires, stock compensation, and clinical manufacturing costs.
  • General and administrative expenses also increased substantially, attributed to additional employee-related costs and professional service expenses as a newly publicly traded company.

Insights

Genelux Corporation's announcement regarding the progress of their clinical trials and the financial results for the fourth quarter and full year 2023 presents a multifaceted picture for investors. The company's cash reserves of $23.2 million, an increase from the previous year's $0.4 million, suggests a strengthened financial position, largely attributable to the successful IPO and private placements. This cash runway is expected to cover operations into the second quarter of 2025, which aligns with the anticipated topline results of the Phase 3 trial in ovarian cancer.

The initiation of a Phase 2 trial in non-small cell lung cancer and an interim readout of a Phase 1b/2 trial in small cell lung cancer set for the second half of 2024 may serve as potential catalysts for the stock. However, the significant increase in R&D and G&A expenses, leading to a net loss that has widened from the previous year, reflects the company's investment in its clinical pipeline. Investors should weigh the potential of the company's therapeutic candidates against the risks inherent in clinical development when considering the long-term valuation of the company.

The clinical development of Olvi-Vec, particularly the Phase 3 trial for platinum-resistant/refractory ovarian cancer and the upcoming trials in lung cancer, are critical for Genelux Corporation's future. The FDA Fast Track designation previously granted is a positive regulatory signal, potentially leading to expedited review and approval processes. The systemic administration route for Olvi-Vec, which is preferred by physicians, could enhance its marketability if the trials prove successful.

From a medical research perspective, the success of these trials could represent a significant advancement in treatment options for these cancers. As the company expands its commercial strategy initiatives, the potential market penetration and revenue generation from Olvi-Vec will highly depend on the outcomes of these clinical trials. The interim readouts in the second half of 2024 will be particularly telling for the small cell lung cancer indication, which is an area with high unmet medical needs.

The shelf registration statement filed with the SEC, allowing Genelux to potentially raise an additional $300 million, indicates a strategic move to secure future funding. This flexibility to offer various securities could support the company's clinical programs and commercial strategy. The partnership with Newsoara and the involvement of a renowned clinician in China could facilitate market entry into Asia, diversifying the company's global footprint.

Given the competitive landscape in immuno-oncology, Genelux's focus on specific cancer types where treatment resistance is an issue could carve out a niche market for Olvi-Vec. The company's preliminary commercial strategy initiatives and the expansion of its management team suggest a forward-looking approach to market readiness, which is essential as the company moves closer to potential product launches.

– Continued active enrollment of Olvi-Vec in our pivotal Phase 3 OnPrime/GOG-3076 trial in platinum resistant/refractory ovarian cancer with topline results anticipated in 2H 2025 –

– Initiation of Phase 2 trial in non-small cell lung cancer (recurrent/platinum-ICI failure) with systemic administration of Olvi-Vec expected in 1H 2024 –

– Ongoing Phase 1b/2 trial with systemic administration of Olvi-Vec in small cell lung cancer expected interim readout in 2H 2024 –

– $23.2 million in cash, cash equivalents and short-term investments –

WESTLAKE VILLAGE, Calif., April 01, 2024 (GLOBE NEWSWIRE) -- Genelux Corporation (NASDAQ: GNLX), a late clinical-stage immuno-oncology company, reported fourth quarter and full year 2023 financial results and business updates.

“Last year was highlighted by the ongoing advancement of our clinical pipeline focused on platinum re-sensitization, including our pivotal Phase 3 trial in platinum resistant/refractory ovarian cancer and development of our two systemic administration trials in lung cancer,” said Thomas Zindrick, President, Chairman and CEO of Genelux. “Looking ahead, we anticipate the culmination of these trials not only holds promise for enhancing the therapeutic landscape but also underscores our dedication to advancing scientific understanding and offering new hope to patients grappling with the complexities of various cancers.”

Pipeline Updates

  • Actively enrolling patients in ongoing Phase 3 OnPrime/GOG-3076 registrational trial in platinum resistant/refractory ovarian cancer (PRROC) in the United States. Currently, 21 sites have been activated to enroll patients with additional sites identified and in various stages of activation (NCT05281471). On track for topline results in 2H 2025. FDA Fast Track designation previously granted by the FDA.
  • Patient enrollment has been increasing in the ongoing Phase 1b part of the Phase 1b/2 trial in patients with recurrent small cell lung cancer. Building on data from early clinical trials, Olvi-Vec is being systemically administered, a physician-preferred route of delivery. Genelux and our partner Newsoara co-sponsor the trial, which is being conducted by Newsoara in greater China. The lead investigator is renowned clinician Professor Shun Lu, M.D., Ph.D. of the prestigious Shanghai Chest Hospital, School of Medicine, Shanghai Jiao Tong University, Shanghai China. Interim readout anticipated in 2H 2024.
  • Initiation of the Phase 2 non-small cell lung cancer trial is anticipated to begin in the 1H 2024. Patients will receive Olvi-Vec through systemic administration.

Business Updates

  • The Company filed a shelf registration statement on Form S-3 with the Securities and Exchange Commission (SEC). Under the shelf registration statement, Genelux may offer and sell, from time to time, up to $300.0 million in common stock, preferred stock, debt securities and/or warrants in one or more offerings. Concurrent with the shelf registration, the Company entered into a sales agreement under which the Company may offer to sell shares of our common stock up to $100.0 million through Guggenheim Securities, acting as our agent.
  • In 2023, the Company grew the core management team to further bolster the development of Olvi-Vec.
  • As Genelux's clinical trial program progresses and diversifies, the company intends to expand its preliminary commercial strategy initiatives and support corporate development efforts.

Fourth Quarter 2023 and Yearly Financial Results

Cash, cash equivalents and short-term investments were $23.2 million as of December 31, 2023 compared to $0.4 million on December 31, 2022. During the 12 months ended December 31, 2023, the Company closed its initial public offering (IPO) and two private placements and received $37.8 million of net proceeds from the offerings. The Company expects its cash, cash equivalents and short-term investments as of December 31, 2023 will provide runway into 2Q 2025.

Research and development (R&D) expenses were approximately $4.2 million and $2.5 million for the three months ended December 31, 2023 and 2022, respectively. R&D expenses were $12.8 million compared to $9.1 million for the years ended December 31, 2023 and 2022, respectively. The year-over-year increase in R&D expenses in 2023 was primarily due to new employee hires, stock compensation, clinical manufacturing, and regulatory increases related to our On-Prime Phase 3 clinical trial in PRROC patients.

General and administrative (G&A) expenses were approximately $2.8 million and $0.7 million for the three months ended December 31, 2023 and 2022, respectively. G&A expenses were $11.6 million and $5.0 million for the years ended December 31, 2023 and 2022, respectively. The year-over-year increases were primarily due to additional employee-related costs, including new employee hires, stock compensation expenses and an increase in professional service expenses related to being a newly publicly traded company.

Net loss was approximately $6.8 million, or $0.25 per basic and diluted share for the three months ended December 31, 2023, compared to a net loss of $3.5 million or $0.38 per basic and diluted share for the same period in 2022. Net loss was approximately $28.3 million, or $1.16 per basic and diluted share for the year ended December 31, 2023, compared to $5.2 million or $0.57 per basic and diluted share for the same period in 2022.

About Genelux Corporation
Genelux is a late clinical-stage biopharmaceutical company focused on developing a pipeline of next-generation oncolytic immunotherapies for patients suffering from aggressive and/or difficult-to-treat solid tumor types. The Company's most advanced product candidate, Olvi-Vec (olvimulogene nanivacirepvec), is a proprietary, modified strain of the vaccinia virus. Olvi-Vec currently is being evaluated in OnPrime/GOG-3076, a multi-center, randomized, open-label Phase 3 registrational trial evaluating the efficacy and safety of Olvi-Vec in combination with platinum-doublet + bevacizumab compared to platinum-doublet + bevacizumab in patients with platinum-resistant/refractory ovarian cancer. The core of Genelux' discovery and development efforts revolves around the company's proprietary CHOICE™ platform from which the Company has developed an extensive library of isolated and engineered oncolytic vaccinia virus immunotherapeutic product candidates, including Olvi-Vec. For more information, please visit www.genelux.com and follow us on Twitter @Genelux_Corp and on LinkedIn.

Forward-Looking Statements
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “believes,” “anticipates,” “expect,” “may,” “plan” or “will”. Forward-looking statements in this release include, but are not limited to, statements related to Genelux’s future plans and prospects, Genelux’s anticipated cash runway and the sufficiency of its resources to support its planned operations, the planned timing of the Genelux’s data results and continued development of Olvi-Vec, the planned initiation of the Phase 2 non-small cell lung cancer trial and the timing thereof; and the potential capabilities and advantages of Olvi-Vec. Such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements. These and other risks are identified under the caption “Risk Factors” in Genelux’s filings with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made and are based on management’s assumptions and estimates as of such date. Genelux does not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events or otherwise.

Investor and Media Contacts

Ankit Bhargava, MD
Allele Communications, LLC
genelux@allelecomms.com

Source: Genelux Corporation

   
   
Genelux Corporation
Balance Sheets
(In thousands, except for share amounts and par value data)
   
 December 31,
  2023  2022 
ASSETS  
Current Assets  
Cash and cash equivalents$9,418 $397 
Short-term investments 13,773  - 
Prepaid expenses and other current assets 1,012  1,495 
Total Current Assets 24,203  1,892 
   
Property and equipment, net 1,170  644 
Right of use assets 2,428  1,335 
Deferred offering costs -  1,568 
Other assets 92  92 
Total Other Assets 3,690  3,639 
   
TOTAL ASSETS$27,893 $5,531 
   
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)  
Current Liabilities  
Accounts payable and accrued expenses$3,784 $6,775 
Accrued payroll and payroll taxes 2,117  2,852 
Accrued interest payable -  1,178 
Accrued interest payable - director and shareholders -  3,817 
Deferred revenue -  170 
Warrant liabilities -  169 
Lease liability, current portion 653  266 
Notes payable - shareholders, net of debt discount of $108 in 2022 -  992 
Convertible notes payable - shareholders, current portion -  15,407 
Total Current Liabilities 6,554  31,626 
   
Long-term Liabilities  
Lease liability, long-term portion 1,866  1,164 
Convertible notes payable, net of debt discount of $541 in 2022 -  8,524 
Total Long-term Liabilities 1,866  9,688 
   
Total Liabilities 8,420  41,314 
   
Shareholders' Equity (Deficit)  
Preferred stock, Series A through K, par value $0.001, 10,000,000 shares authorized as of 12/31/2023 and 29,927,994 authorized as of 12/31/2022; no shares and 22,094,889 shares issued and outstanding, respectively; -  22 
Common stock, par value $0.001, 200,000,000 shares authorized; 26,788,986 and 9,126,726 shares issued and outstanding, respectively 27  9 
Treasury stock, 433,333 shares, at cost (433) (433)
Additional paid-in capital 241,389  154,401 
Accumulated other comprehensive income 14  2 
Accumulated deficit (221,524) (189,784)
Total Shareholders' Equity (Deficit) 19,473  (35,783)
   
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)$27,893 $5,531 
   
   
The accompanying notes are an integral part of these financial statements.
   



   
Genelux Corporation
Statements of Operations
(in thousands, except for share amounts and per share data)
   
 Years Ended
 December 31,
  2023  2022 
   
Revenues$170 $11,068 
   
Operating expenses:  
  Research and development 12,767  9,078 
  General and administrative 11,568  5,003 
Total operating expenses 24,335  14,081 
   
Loss from operations (24,165) (3,013)
   
Other income (expenses):  
  Interest income 244  - 
  Interest expense (173) (1,150)
  Debt discount amortization (649) (258)
  Financing costs (3,152) - 
  Debt extinguishment costs (402) - 
  Gain on forgiveness of PPP loan payable -  314 
Total other income (expenses), net (4,132) (1,094)
   
Loss before provision for foreign income taxes (28,297) (4,107)
Provision for foreign income taxes -  (1,100)
   
NET LOSS$(28,297)$(5,207)
   
LOSS PER COMMON SHARE - BASIC AND DILUTED$(1.16)$(0.57)
   
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING - BASIC AND DILUTED 24,429,278  9,116,489 
   
   
The accompanying notes are an integral part of these financial statements.
   


 
Genelux Corporation
Statements of Comprehensive Loss
(in thousands)
   
 Years Ended
 December 31,
  2023  2022 
   
Net loss$(28,297)$(5,207)
   
Other comprehensive loss:  
   Net unrealized gain on short-term investments 12  - 
Comprehensive loss$(28,285)$(5,207)
   
   
The accompanying notes are an integral part of these financial statements.

FAQ

What are the topline results anticipated for Genelux's pivotal Phase 3 OnPrime/GOG-3076 trial in platinum resistant/refractory ovarian cancer?

Topline results are expected in 2H 2025.

How much cash and investments does Genelux hold?

Genelux holds $23.2 million in cash, cash equivalents, and short-term investments.

What is the expected timeline for the initiation of the Phase 2 trial in non-small cell lung cancer for Genelux?

The initiation of the Phase 2 trial is anticipated in 1H 2024.

What is the purpose of the shelf registration statement filed by Genelux with the SEC?

Genelux may offer and sell up to $300.0 million in common stock, preferred stock, debt securities, and/or warrants through the shelf registration.

What was the net loss for Genelux for the year ended December 31, 2023?

The net loss was approximately $28.3 million, or $1.16 per basic and diluted share.

What were the research and development expenses for Genelux for the three months ended December 31, 2023?

Research and development expenses were approximately $4.2 million for the three months ended December 31, 2023.

How many sites are currently activated to enroll patients in Genelux's Phase 3 trial for platinum resistant ovarian cancer?

Currently, 21 sites have been activated to enroll patients.

Who is the lead investigator for Genelux's Phase 1b/2 trial in small cell lung cancer?

The lead investigator is Professor Shun Lu, M.D., Ph.D. of Shanghai Chest Hospital, School of Medicine, Shanghai Jiao Tong University, China.

Genelux Corporation

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