Qualigen Therapeutics Announces Business Highlights and First Quarter Fiscal Year 2021 Financial Results; Has $16 Million in Cash on Hand as of Today
Qualigen Therapeutics reported its fiscal Q1 2021 results, showing total revenues of $0.9 million, down from $1.5 million in Q1 2020, largely attributed to the COVID-19 pandemic's impact on diagnostic test volumes. The company raised $18 million through equity financing, with cash reserves now at $16 million, adequate to fund operations into 2022. Significant developments include exclusive licensing agreements with the University of Louisville for cancer drug candidates and COVID-19 treatment. However, net loss surged to $18.6 million, inclusive of a $16.2 million non-cash charge for warrant liabilities.
- Raised $18 million in new equity financing.
- Exclusive license agreements signed for RAS oncogene inhibitors and COVID-19 treatment.
- Cash and cash equivalents of $16 million sufficient for operations into 2022.
- Total revenues decreased to $0.9 million from $1.5 million due to reduced test volumes.
- General and administrative expenses rose significantly to $2.0 million.
- Net loss increased to $18.6 million from $0.6 million, primarily due to a non-cash charge for warrant liabilities.
CARLSBAD, Calif., Aug. 14, 2020 /PRNewswire/ -- Qualigen Therapeutics, Inc. (NASDAQ: QLGN) (Qualigen or the Company) today announced business highlights and financial results for the fiscal year 2021 first quarter, ended June 30, 2020.
Business highlights for the fiscal first quarter and recent weeks include the following:
- Raised a total of
$18 million in new equity financing. Under separate purchase agreements in July and August 2020, the Company raised a total of$18 million in cash (before expenses) from registered-direct placements of common stock and warrants with a single institutional investor. As of today, the Company has$16 million in cash and cash equivalents. The Company believes its cash and cash equivalents are sufficient to fund its operations into calendar 2022.
- Signed exclusive license agreement with the University of Louisville for RAS interaction inhibitor drug candidates. In July 2020, Qualigen signed an exclusive worldwide license agreement with the University of Louisville (UofL) for the intellectual property covering the RAS-F family of RAS oncogene protein-protein interaction inhibitor small molecule drug candidates. The Company will evaluate these patent-pending compounds in order to identify a lead drug candidate for further development against one or more cancers.
- Signed exclusive license agreement with the University of Louisville, with plans to develop AS1411 for the treatment of COVID-19. In June 2020, the Company signed an exclusive license agreement with the UofL to facilitate development of Qualigen's AS1411 DNA aptamer as a drug candidate for the treatment of COVID-19, the disease caused by the novel coronavirus SARS-CoV-2.
- Engaged NFL Hall of Famer Mike Haynes as advisor to the Company and spokesperson for the FastPack® rapid diagnostic system. In July 2020, the Company engaged Pro Football Hall of Fame and College Football Hall of Fame inductee Mike Haynes as an advisor to the Company and as spokesperson for Qualigen's FastPack rapid diagnostic system. Since receiving an elevated PSA test result using a FastPack immunoassay test at a 2008 Hall of Fame event sponsored by Qualigen and the American Urological Association, Mr. Haynes has been a prominent advocate for prostate cancer testing.
- Commenced commercial shipments of its FastPack COVID-19 antibody test. In July 2020, Qualigen announced it began commercial shipments of its FastPack SARS-CoV-2 IgG diagnostic test for COVID-19 antibodies. This test has been submitted to the U.S. Food and Drug Administration (FDA) for Emergency Use Authorization (EUA), and previously the Company submitted an official notification to the FDA of its plans to exercise its right to commence sales while the EUA is pending.
- Received U.S. patent Notice of Allowance for its STARS™ technology. In June 2020, the United States Patent and Trademark Office issued Qualigen a Notice of Allowance for a U.S. patent titled "Devices and Methods for On-Line Whole Blood Treatment" regarding the Company's Selective Target Antigen Removal System (STARS) technology. STARS is a DNA/RNA-based treatment product candidate for the removal of viral and tumor-produced compounds from a patient's blood.
Management Commentary
"I am pleased with the significant progress Qualigen has made since our May 2020 reverse recapitalization transaction to expand and advance our development programs," stated Michael Poirier, President and Chief Executive Officer of Qualigen. "We recently raised
First Quarter Financial Results
Total revenues for the three months ended June 30, 2020 were
General and administrative expense was
Total R&D expense was
Loss from operations for the three months ended June 30, 2020 increased to
Qualigen had cash and cash equivalents of
Conference Call
Qualigen senior management will host a business update conference call and live audio webcast beginning at 4:30 p.m. Eastern time on August 18, 2020. Participants are encouraged to pre-register for the conference call using this link. Callers who pre-register will be given a conference passcode and unique PIN to gain immediate access to the call and bypass the live operator. Participants may register at any time, including up to and after the call start time. A webcast of the call may also be accessed at Qualigen's Investor Relations page at Qualigen Business Update Conference Call. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509 (U.S.) or 1-412-317-5413 (International).
A replay of the webcast will be available beginning approximately one hour after the completion of the live conference call at Qualigen Business Update Conference Call. A dial-in replay of the call will be available until August 25, 2020 by calling 1-877-344-7529 (U.S.) or 1-412-317-0088 (International) and providing the passcode 10147089.
About Qualigen Therapeutics, Inc.
Qualigen Therapeutics, Inc. is a biotechnology company focused on developing novel therapeutics for the treatment of cancer and infectious diseases, as well as maintaining and expanding its core FDA-approved FastPack System, which has been used successfully in diagnostics for almost 20 years. The Company's cancer therapeutics pipeline includes ALAN (AS1411-GNP), RAS-F and STARS. ALAN (AS1411-GNP) is a DNA coated gold nanoparticle cancer drug candidate that has the potential to target various types of cancer with minimal side effects. The foundational aptamer of ALAN, AS1411, is also being studied for use in treating viral-based infectious diseases, including COVID-19. RAS-F is a family of RAS oncogene protein-protein interaction inhibitor small molecules for preventing mutated RAS genes' proteins from binding to their effector proteins; preventing this binding could stop tumor growth, especially in pancreatic, colorectal and lung cancers. STARS is a DNA/RNA-based treatment device candidate for removal from circulating blood of precisely targeted tumor-produced and viral compounds. Because Qualigen's therapeutic candidates are still in the development stage, Qualigen's only products that are currently commercially available are FastPack System diagnostic instruments and test kits, used in physician offices, clinics and small hospitals around the world. The FastPack System menu includes rapid point-of-care diagnostic tests for cancer, men's health, hormone function, vitamin D status and antibodies against SARS-CoV-2. Qualigen's facility in Carlsbad, California is FDA and ISO Certified and its FastPack product line is sold worldwide by its commercial partner Sekisui Diagnostics, LLC. For more information on Qualigen Therapeutics, Inc., please visit https://www.qualigeninc.com/.
Forward-Looking Statements
This news release contains forward-looking statements by the Company that involve risks and uncertainties and reflect the Company's judgment as of the date of this release. These statements include those related to cash burn estimates and potential future development, testing and launch of product candidates. Actual events or results may differ from the Company's expectations. For example, there can be no assurance that the Company will successfully develop any drugs or therapeutic devices; that preclinical or clinical development of the Company's drugs or therapeutic devices will be successful; that clinical trials will be approved to begin by or will proceed as contemplated by any projected timeline; that future clinical trial data will be favorable or that such trials will confirm any improvements over other products or lack negative impacts; that any drugs or therapeutic devices will receive required regulatory approvals or that they will be commercially successful; that patents will issue on the Company's in-licensed patent applications; that such patents, if any, and the Company's current owned and in-licensed patents would prevent competition; that the Company will be able to procure or earn sufficient working capital to complete the development, testing and launch of the Company's prospective therapeutic products; that the Company will be able to maintain or expand market demand and/or market share for the Company's diagnostic products generally, particularly in view of COVID-19-related deferral of patients' physician-office visits and FastPack reimbursement pricing challenges; that adoption and placement of FastPack PRO System instruments (which are the only FastPack instruments on which the Company's SARS-CoV-2 IgG test kits can be run) will be widespread; that the Company will be able to manufacture the FastPack PRO System instruments and SARS-CoV-2 IgG test kits successfully; that any commercialization of the FastPack PRO System instruments and SARS-CoV-2 IgG test kits will be profitable; or that the FDA will ultimately approve an EUA for the Company's SARS-CoV-2 IgG test. The Company's stock price could be harmed if any of the events or trends contemplated by the forward-looking statements fails to occur or is delayed or if any actual future event otherwise differs from expectations. Additional information concerning these and other risk factors affecting the Company's business (including events beyond the Company's control, such as epidemics and resulting changes) can be found in the Company's prior filings with the Securities and Exchange Commission, available at www.sec.gov. The Company disclaims any intent or obligation to update these forward-looking statements beyond the date of this news release, except as required by law. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
[Tables to Follow]
QUALIGEN THERAPEUTICS, INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Unaudited) | ||||||||
Three Months Ended | ||||||||
2020 | 2019 | |||||||
REVENUES | ||||||||
Net product sales | $ | 484,423 | $ | 560,651 | ||||
Net product sales—related party | 419,644 | 950,184 | ||||||
Total revenues | 904,067 | 1,510,835 | ||||||
EXPENSES | ||||||||
Cost of product sales | 355,427 | 316,513 | ||||||
Cost of product sales—related party | 452,495 | 661,267 | ||||||
General and administrative | 1,979,614 | 269,017 | ||||||
Research and development | 597,345 | 147,641 | ||||||
Research and development—related party | — | 539,425 | ||||||
Sales and marketing | 88,844 | 102,394 | ||||||
Total expenses | 3,473,725 | 2,036,257 | ||||||
LOSS FROM OPERATIONS | (2,569,658) | (525,422) | ||||||
OTHER EXPENSE (INCOME), NET | ||||||||
Change in fair value of warrant liabilities | 16,201,400 | — | ||||||
Interest expense, net | 57,364 | 69,985 | ||||||
Other income, net | (250,114) | (992) | ||||||
Total other expense (income), net | 16,008,650 | 68,993 | ||||||
LOSS BEFORE PROVISION FOR INCOME TAXES | (18,578,308) | (594,415) | ||||||
PROVISION FOR INCOME TAXES | 597 | 150 | ||||||
NET LOSS | $ | (18,578,905) | $ | (594,565) | ||||
Net loss per common share, basic and diluted | $ | (2.12) | $ | (0.11) | ||||
Weighted—average number of shares outstanding, basic and diluted | 8,746,250 | 5,602,214 | ||||||
QUALIGEN THERAPEUTICS, INC. | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(Unaudited) | ||||||||
June 30, 2020 | March 31, 2020 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 2,306,422 | $ | 153,121 | ||||
Restricted cash | 75,696 | — | ||||||
Accounts receivable, net | 282,170 | 417,122 | ||||||
Accounts receivable — related party, net | 55,292 | 290,180 | ||||||
Inventory, net | 640,260 | 660,138 | ||||||
Prepaid expenses and other current assets | 2,318,057 | 98,385 | ||||||
Total current assets | 5,677,897 | 1,618,946 | ||||||
Right-of-use asset | 535,194 | — | ||||||
Property and equipment, net | 1,547,380 | 1,447,514 | ||||||
Equipment held for lease, net | 45,411 | 64,005 | ||||||
Intangible assets, net | 855,132 | 571,270 | ||||||
Other assets | 18,279 | 18,279 | ||||||
Total Assets | $ | 8,679,293 | $ | 3,720,014 | ||||
LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 892,182 | $ | 879,264 | ||||
Accrued expenses and other current liabilities | 1,315,899 | 1,243,764 | ||||||
Notes payable, current portion | 1,106,518 | 1,913,255 | ||||||
Deferred revenue, current portion | 69,571 | 105,416 | ||||||
Deferred revenue — related party | 271,206 | 271,206 | ||||||
Due to related party | 1,144,513 | 926,385 | ||||||
Lease liability | 239,549 | — | ||||||
Warrant liabilities | 16,201,400 | — | ||||||
Total current liabilities | 21,240,838 | 5,339,290 | ||||||
Notes payable, net of current portion | 218,832 | 305,805 | ||||||
Lease liability, net of current portion | 368,785 | — | ||||||
Deferred revenue, net of current portion | 3,594 | 2,689 | ||||||
Total liabilities | 21,832,049 | 5,647,784 | ||||||
Total stockholders' deficit | (13,152,756) | (1,927,770) | ||||||
Total Liabilities and Stockholders' Deficit | $ | 8,679,293 | $ | 3,720,014 | ||||
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