On May 9, 2023 ESSA Pharma Inc. ("ESSA", or the "Company") (NASDAQ: EPIX), a clinical-stage pharmaceutical company focused on developing novel therapies for the treatment of prostate cancer, reported a corporate update and announced financial results for the fiscal second quarter ended March 31, 2023 (Press release, ESSA, MAY 9, 2023, View Source [SID1234631310]). All references to "$" in this release refer to United States dollars, unless otherwise indicated.

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"ESSA is in a strong cash position as we execute our clinical strategy to advance our lead candidate, EPI-7386, with our cash runway expected to fund operations and programs through 2025," stated David Parkinson, MD, President and CEO of ESSA. "This quarter, we continued to enroll patients into our Phase 1 study of EPI-7386 in combination with Xtandi (enzalutamide), and we are working with clinical sites to prepare for initiation of the randomized Phase 2 portion of the study as soon we complete Phase 1 and select a recommended Phase 2 dose. Our Phase 1 EPI-7386 monotherapy expansion study is progressing as planned with two doses of EPI-7386 currently being tested in advanced metastatic castration-resistant prostate cancer ("mCRPC") patients. We also advanced an additional EPI-7386 combination therapy program through an agreement with Janssen, under which Janssen will supply Erleada (apalutamide) and Zytiga (abiraterone acetate) for an ESSA-sponsored and conducted Phase 1 clinical study in multiple prostate cancer patient populations including metastatic hormone-sensitive prostate cancer patients and non-metastatic castration-sensitive prostate cancer patients. We plan to begin testing these new antiandrogen combinations with EPI-7386 in the second half of 2023."

Clinical and Corporate Highlights for the Second Quarter Ended March 31, 2023

EPI-7386 Clinical Collaborations

The Company continues to enroll patients into the fourth cohort of the Phase 1/2 study of EPI-7386 in combination with enzalutamide in patients with mCRPC naïve to second generation antiandrogens. The Company expects to complete the Phase 1 portion of the study and establish the recommended Phase 2 combination doses (for both EPI-7386 and enzalutamide when used in combination) in the third quarter of 2023, followed by initiation of the Phase 2 part of the study. The open-label, randomized Phase 2 study will assess the anti-tumor activity of EPI-7386 in combination with enzalutamide at the recommended phase 2 doses versus single agent enzalutamide at the standard of care dose. The Phase 2 study is expected to enroll approximately 120 patients.
In April 2023, the Company entered into a clinical trial support agreement with Janssen Research & Development, LLC ("Janssen") under which Janssen will supply apalutamide and abiraterone acetate for a Phase 1 clinical study sponsored and conducted by ESSA evaluating EPI-7386 combination therapies in two cohorts. The two cohorts will be evaluated as additional cohorts in the Company’s ongoing Phase 1 study of EPI-7386 (Clinical Trials Identifier: NCT04421222). Cohort A will assess EPI-7386 in combination with abiraterone acetate plus prednisone in patients with mCRPC and high-risk metastatic castration-sensitive prostate cancer. Cohort B is a Window of Opportunity study in which patients with non-metastatic castration-resistant prostate cancer ("nmCRPC") will receive up to 12 weeks of single agent EPI-7386 before adding standard-of-care apalutamide. ESSA will retain all rights to EPI-7386. The Company expects enrollment to begin in the second half of 2023.
EPI-7386 Monotherapy

The Phase 1b EPI-7386 monotherapy dose expansion study is ongoing and is evaluating two doses/schedules of single agent EPI-7386 in mCRPC patients with less than three prior lines of therapy, no visceral disease and no prior chemotherapy who have progressed on at least one second-generation antiandrogen. The Company is also enrolling nmCRPC patients in the Window of Opportunity cohort of this study, in which patients will receive 12 weeks of EPI-7386 monotherapy treatment before starting standard of care therapy.
Summary Financial Results

Net Loss. ESSA recorded a comprehensive loss of $7.1 million for the first quarter ended March 31, 2023, compared to a comprehensive loss of $10.9 million for the second quarter ended March 31, 2022. For the second quarter ended March 31, 2023, this included non-cash share-based payments of $1.4 million compared to $1.9 million for the prior year, recognized for stock options granted and vesting. The decrease in the second quarter was primarily attributed to decreases in research and development expenditures and general and administration expenditures in addition to an increase of $852,347 in interest income.
Research and Development ("R&D") expenditures. R&D expenditures for the second quarter ended March 31, 2023 were $4.5 million compared to $7.6 million for the second quarter ended March 31, 2022 and include non-cash costs related to share-based payments ($750,159 for the second quarter ended 2023 compared to $1.1 million for the second quarter ended 2022). The decrease in R&D expenditures for the year ended March 31, 2023 is the result of decreased non-cash share-based payments, legal patents and license fees and manufacturing costs related to the Phase 1 clinical trial of EPI-7386.
General and administration ("G&A") expenditures. G&A expenditures for the second quarter ended March 31, 2023 were $3.7 million compared to $3.8 million for the second quarter ended March 31, 2022 and include non-cash costs related to share-based payments of $686,932 for the second quarter ended 2023 compared to $741,494 for the second quarter ended 2022. The decrease in the second quarter is the result of decreased non-cash share-based payments and professional fees.
Liquidity and Outstanding Share Capital

At March 31, 2023, the Company had available cash reserves and short-term investments of $157 million reflecting the gross proceeds of the February 2021 financing of approximately $150.0 million and July 2020 financing of $48.9 million, less operating expenses in the intervening period. The Company’s cash position is expected to be sufficient to fund current and planned operations through 2025.

As of March 31, 2023, the Company had 44,092,374 common shares issued and outstanding.

In addition, as of March 31, 2023 there were 2,927,477 common shares issuable upon the exercise of warrants and broker warrants. This includes 2,920,000 prefunded warrants at an exercise price of $0.0001, and 7,477 warrants at a weighted average exercise price of $42.80. There were 8,045,274 common shares issuable upon the exercise of outstanding stock options at a weighted-average exercise price of $5.08 per common share.