Kintara Therapeutics Announces Fiscal 2024 Third Quarter Financial Results
Kintara Therapeutics (Nasdaq: KTRA) announced its fiscal Q3 2024 financial results ending March 31, 2024. Key developments include a definitive merger agreement with TuHURA Biosciences. Post-merger, Kintara stockholders will own 2.85% to 5.45% of the combined company. The merger is expected to close in Q3 2024. Kintara expanded the inclusion criteria for its REM-001 study and initiated a study in CMBC patients, funded by a $2M NIH grant. Financially, Kintara saw a net loss of $2M ($0.05/share) compared to $3.3M ($1.94/share) in Q3 2023, attributed to lower R&D costs. Cash and equivalents were $6.35M, up from $1.54M in June 2023.
- Kintara entered a definitive merger agreement with TuHURA Biosciences, enhancing its portfolio.
- Post-merger, Kintara stockholders could own up to 5.45% of the combined company.
- Expanded the inclusion criteria and initiated a new study for REM-001 in CMBC patients.
- $2M NIH grant reduces financial burden for the REM-001 study.
- Regained compliance with Nasdaq's minimum stockholders' equity requirement.
- Cash and cash equivalents increased to $6.35M from $1.54M in June 2023.
- Net loss decreased from $3.3M in Q3 2023 to $2M in Q3 2024.
- Net loss for the period was $2M, which continues to impact financial stability.
- Increased general and administrative costs due to professional fees related to the merger.
- Potential dilution of shares post-merger, affecting current stockholders' value.
- R&D expenses were lower due to reduced clinical development costs, which could impact future growth.
Insights
The financial results for Kintara Therapeutics show a substantial improvement in their net loss, dropping to approximately
However, general and administrative expenses increased, primarily due to higher professional fees associated with the proposed merger with TuHURA. Investors should note that while this enhances strategic growth potential, it also reflects an immediate increase in operational costs.
Overall, while the decrease in net loss and increase in cash reserves offer a positive short-term outlook, the upcoming merger and continued clinical trial expenses pose potential risks and opportunities in the medium to long term.
The ongoing and newly initiated studies, particularly the 15-patient REM-001 study, target significant unmet needs in cutaneous metastatic breast cancer (CMBC) treatment. The inclusion of patients who have been receiving pembrolizumab (KEYTRUDA®) aligns well with current oncological treatment paradigms, potentially setting a new benchmark in combination therapy strategies. The primary endpoint, Best Overall Objective Response Rate (bORR), is a critical measure of treatment efficacy, indicating the proportion of patients showing a significant reduction in tumor size.
This clinical advancement, backed by a
The merger with TuHURA Biosciences is a strategic move that could significantly alter Kintara's market positioning. TuHURA's focus on immune-oncology and overcoming resistance to cancer immunotherapy represents a complementary addition to Kintara's portfolio. This merger is particularly interesting as it involves contingent value rights (CVR), incentivizing the achievement of specific clinical milestones, thereby aligning the long-term interests of Kintara’s existing shareholders with the success of the merged entity.
From a market perspective, this merger holds the potential to enhance Kintara’s value proposition and diversify its pipeline, which could attract new investors and partnerships. However, the dilution of existing shareholders to about 2.85% post-merger should be carefully considered. The integration of TuHURA and the achievement of clinical milestones will be pivotal in realizing the anticipated synergies and financial performance improvement.
Recent Corporate Developments
- Announced that Kintara had entered into a definitive merger agreement (the "Merger Agreement") with TuHURA Biosciences, Inc. ("TuHURA"), a Phase 3 registration-stage immune-oncology company developing novel technologies to overcome resistance to cancer immunotherapy, and Kayak Mergeco, Inc., Kintara's wholly-owned subsidiary, whereby Kayak Mergeco will merge with and into TuHURA with TuHURA surviving the merger and becoming Kintara's direct, wholly-owned subsidiary(the "Merger"). Pursuant to the terms of the Merger, stockholders of TuHURA will receive shares of Kintara common stock. Kintara's existing stockholders will receive contingent value rights ("CVR"), entitling them to receive shares of common stock upon achievement of enrollment of a minimum of 10 patients in the REM-001 study, with such patients each completing 8 weeks of follow-up on or before December 31, 2025. Under the terms of the Merger Agreement, on a pro forma basis, Kintara's stockholders post-Merger are expected to collectively own approximately
2.85% , or approximately5.45% including the shares underlying the CVR if the milestone is achieved, of the common stock of the post-Merger combined company on a fully-diluted basis. The transaction is expected to close in the third quarter of 2024. (April 2024)
- Announced the expansion of the inclusion criteria in the open label 15-patient REM-001 study in cutaneous metastatic breast cancer (CMBC) to include patients receiving pembrolizumab (KEYTRUDA®) for at least three months at screening. (March 2024)
- Announced the initiation of an open label 15-patient study in CMBC patients which is evaluating REM-001, a second-generation photodynamic therapy (PDT) photosensitizer agent, and is designed to test the 0.8 mg dose as well as optimize the study design in advance of a Phase 3 trial initiation. The primary endpoint in the study is Best Overall Objective Response Rate (bORR) (complete response or partial response) of the target treatment fields at any time from treatment up to, and including, week 24. The majority of the costs to run this study will be covered by the
$2.0 million
- Announced that Kintara received a letter from The Nasdaq Stock Market LLC stating it had regained compliance with Nasdaq's minimum stockholders' equity requirement. (February 2024)
Summary of Financial Results for Fiscal Year 2023 Third Quarter Ended March 31, 2024
As of March 31, 2024, Kintara had cash and cash equivalents of approximately
For the three months ended March 31, 2024, Kintara reported a net loss of approximately
Selected Balance Sheet Data (in thousands) | ||||||||
March 31, | June 30, | |||||||
$ | $ | |||||||
Cash and cash equivalents | 6,351 | 1,535 | ||||||
Working capital | 5,414 | 188 | ||||||
Total assets | 7,446 | 3,979 | ||||||
Total stockholders' equity | 5,922 | 731 | ||||||
Selected Statement of Operations Data (in thousands, except per share data) | |||||||||
For the three months ended | |||||||||
March 31, | March 31, | ||||||||
2024 | 2023 | ||||||||
$ | $ | ||||||||
Research and development | 592 | 2,005 | |||||||
General and administrative | 1,493 | 1,297 | |||||||
Other loss (income) | (74) | (38) | |||||||
Net loss for the period | (2,011) | (3,264) | |||||||
Series A Preferred cash dividend | (2) | (2) | |||||||
Net loss for the period attributable to common stockholders | (2,013) | (3,266) | |||||||
Basic and fully diluted weighted average number of shares | 44,562 | 1,681 | |||||||
Basic and fully diluted loss per share | (0.05) | (1.94) | |||||||
For the nine months ended | |||||||||
March 31, | March 31, | ||||||||
2024 | 2023 | ||||||||
$ | $ | ||||||||
Research and development | 2,562 | 7,235 | |||||||
General and administrative | 3,054 | 4,212 | |||||||
Other loss (income) | (70) | (133) | |||||||
Net loss for the period | (5,996) | (11,314) | |||||||
Series A Preferred cash dividend | (6) | (6) | |||||||
Series C Preferred stock dividend | (173) | (362) | |||||||
Net loss for the period attributable to common stockholders | (6,175) | (11,682) | |||||||
Basic and fully diluted weighted average number of shares | 16,772 | 1,596 | |||||||
Basic and fully diluted loss per share | (0.37) | (7.32) | |||||||
Kintara's financial statements as filed with the
About Kintara
Located in
Kintara has a proprietary, late-stage photodynamic therapy platform that holds promise as a localized cutaneous, or visceral, tumor treatment as well as in other potential indications. REM-001 Therapy, which consists of the laser light source, the light delivery device, and the REM-001 drug product, has been previously studied in four Phase 2/3 clinical trials in patients with CMBC who had previously received chemotherapy and/or failed radiation therapy. In CMBC, REM-001 has a clinical efficacy to date of
For more information, please visit www.kintara.com or follow us on X at @Kintara_Thera, Facebook and LinkedIn.
About TuHURA Biosciences, Inc.
TuHURA Biosciences is a Phase 3 registration-stage immuno-oncology company developing novel technologies to overcome resistance to cancer immunotherapy. TuHURA's lead personalized cancer vaccine candidate, IFx-2.0, is designed to overcome primary resistance to checkpoint inhibitors. TuHURA is preparing to initiate a single randomized placebo-controlled Phase 3 registration trial of IFx-2.0 administered as an adjunctive therapy to Keytruda® (pembrolizumab) in first line treatment for advanced Merkel Cell Carcinoma.
In addition to its cancer vaccine product candidates, TuHURA is leveraging its Delta receptor technology to develop first-in-class bi-functional antibody drug conjugates (ADCs), targeting Myeloid Derived Suppressor Cells (MDSCs) to inhibit their immune suppressing effects on the tumor microenvironment to prevent T cell exhaustion and acquired resistance to checkpoint inhibitors and cellular therapies.
For more information, please visit tuhurabio.com and connect with TuHURA on Facebook, X, and LinkedIn.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any proxy, consent, authorization, vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made, except by means of a prospectus meeting the requirements of the
Additional Information About the Proposed Transaction for Investors and Shareholders
In connection with the proposed transaction between Kintara and TuHURA (the "Proposed Transaction"), Kintara has filed relevant materials with the
Participants in the Solicitation
Kintara, TuHURA and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from stockholders in connection with the Proposed Transaction. Information about Kintara's directors and executive officers including a description of their interests in Kintara is included in Kintara's most recent Annual Report on Form 10-K, including any information incorporated therein by reference, as filed with the SEC. Additional information regarding these persons and their interests in the transaction has been and will be included in the preliminary proxy statement/prospectus and other relevant materials filed with the SEC when they become available relating to the Proposed Transaction. These documents can be obtained free of charge from the sources indicated above.
Safe Harbor Statement
This news release contains forward-looking statements that are not historical facts within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and other future conditions. In some cases you can identify these statements by forward-looking words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "could," "should," "would," "project," "plan," "expect," "goal," "seek," "future," "likely" or the negative or plural of these words or similar expressions. Examples of such forward-looking statements include but are not limited to express or implied statements regarding Kintara's or TuHURA's management team's expectations, hopes, beliefs, intentions or strategies regarding the future including, without limitation, statements regarding: the Proposed Transaction and the expected effects, perceived benefits or opportunities and related timing with respect thereto, expectations regarding clinical trials and research and development programs, in particular with respect to TuHURA's IFx-Hu2.0 product candidate and its TME modulators development program, and any developments or results in connection therewith; the anticipated timing of the results from those studies and trials; expectations regarding the use of capital resources, including the net proceeds from the financing that closed in connection with the signing of the definitive agreement, and the time period over which the combined company's capital resources will be sufficient to fund its anticipated operations; and the expected trading of the combined company's stock on the Nasdaq Capital Market. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. You are cautioned that such statements are not guarantees of future performance and that actual results or developments may differ materially from those set forth in these forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include: the risk that the conditions to the closing or consummation of the Proposed Transaction are not satisfied, including the failure to obtain stockholder approval for the Proposed Transaction; uncertainties as to the timing of the consummation of the Proposed Transaction and the ability of each of Kintara and TuHURA to consummate the transactions contemplated by the Proposed Transaction; risks related to Kintara's and TuHURA's ability to correctly estimate their respective operating expenses and expenses associated with the Proposed Transaction, as applicable, as well as uncertainties regarding the impact any delay in the closing would have on the anticipated cash resources of the resulting combined company upon closing and other events and unanticipated spending and costs that could reduce the combined company's cash resources; the occurrence of any event, change or other circumstance or condition that could give rise to the termination of the Proposed Transaction by either company; the effect of the announcement or pendency of the Proposed Transaction on Kintara's or TuHURA's business relationships, operating results and business generally; costs related to the Merger; the outcome of any legal proceedings that may be instituted against Kintara, TuHURA, or any of their respective directors or officers related to the Merger Agreement or the transactions contemplated thereby; the ability of Kintara or TuHURA to protect their respective intellectual property rights; competitive responses to the Proposed Transaction; unexpected costs, charges or expenses resulting from the Proposed Transaction; whether the combined business of TuHURA and Kintara will be successful; legislative, regulatory, political and economic developments; and additional risks described in the "Risk Factors" section of Kintara's Annual Report on Form 10-K for the fiscal year ended June 30, 2023, and the registration statement on Form S-4 related to the Proposed Transaction filed with the SEC. Additional assumptions, risks and uncertainties are described in detail in our registration statements, reports and other filings with the SEC, which are available on Kintara's website, and at www.sec.gov.
You are cautioned that such statements are not guarantees of future performance and that our actual results may differ materially from those set forth in the forward-looking statements. The forward-looking statements and other information contained in this news release are made as of the date hereof and Kintara does not undertake any obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. Nothing herein shall constitute an offer to sell or the solicitation of an offer to buy any securities.
CONTACTS
Investors
Robert E. Hoffman
Kintara Therapeutics
rhoffman@kintara.com
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SOURCE Kintara Therapeutics
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