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Vaxart Announces First Quarter 2018 Financial Results

and Corporate Update

On May 15, 2018 Vaxart, Inc. (Nasdaq: VXRT), a clinical-stage biotechnology company developing oral recombinant vaccines that are administered by tablet rather than by injection, reported financial results for the first quarter ended March 31, 2018 and provided a corporate update (Press release, Aviragen Therapeutics, MAY 15, 2018, View Source [SID1234526635]).

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"Since the start of this year, we have made considerable progress advancing our business objectives and progressing our oral vaccine candidates as well as teslexivir for the treatment of condyloma caused by HPV," said Wouter Latour, chief executive officer of Vaxart. "Moreover, with the addition of Dr. David Taylor as our new chief medical officer, we are exceedingly well positioned to execute on the clinical strategy for our oral vaccines. We look forward to continued progress in 2018, with important clinical milestones coming up, including the reporting of topline results from the teslexivir Phase 2 trial in June and the initiation of the norovirus vaccine clinical studies later this year."

First Quarter 2018 and Recent Highlights:

Corporate:

On February 13, 2018, Vaxart closed its merger with publicly traded Aviragen Therapeutics, Inc. The combined public entity is now named Vaxart, Inc., and is traded on the Nasdaq Capital market under the ticker symbol "VXRT." The operations of Aviragen Therapeutics are included in the financial statements from the date of the merger forward.

On April 20, 2018, Vaxart announced it received notification from Daiichi Sankyo Co., Ltd, that sales of Inavir, a single dose product licensed in Japan to prevent or treat influenza infection, exceeded ¥20 billion in the royalty year ending March 31, 2018, triggering a $5 million milestone payment to Vaxart that will be paid in the second quarter of 2018.

On April 19, 2018, Vaxart announced the appointment of Brant Biehn as Senior Vice President, Commercial Operations. Mr. Biehn brings over 27 years of commercial planning, market development and sales experience in the pharmaceutical industry.

On May 1, 2018, Vaxart announced the appointment of David Taylor, M.D., as Chief Medical Officer. Dr. Taylor brings over 35 years of experience in medical research, drug and vaccine development and clinical trial management for government organizations, non-profits, academia and both private and public healthcare companies.

First Quarter 2018 Financial Results:

Vaxart ended the quarter with cash, cash equivalents and short-term investments of $17.5 million compared to $3.0 million at December 31, 2017. The increase was due to cash received from Aviragen upon consummation of the reverse merger on February 13, 2018, offset by cash used in operations.

Revenue for the quarter was $1.5 million compared to $2.3 million in the first quarter of 2017. Revenue from the contract with HHS BARDA decreased $1.7 million as activities are winding down. Royalty revenue from sales of Relenza and Inavir, which were acquired in the merger, amounted to $0.9 million since the date of the merger. Most of the quarter’s royalty revenue, including the $5 million Inavir milestone, was earned prior to the merger and is reflected as $11.1 million in accounts receivable as of March 31, 2018.

Research and development expenses were $3.4 million for the quarter compared to $3.9 million for the first quarter of 2017. The decrease was primarily due to reduced activity under Vaxart’s contract with HHS BARDA, offset by clinical expenses relating to Aviragen’s operations since the date of the merger.

General and administrative expenses were $2.0 million for the first quarter of 2018, compared to $0.7 million for the first quarter of 2017. The increase was primarily due to the additional costs of being a public company, merger-related costs and the overlap of personnel during the transition of operations following the merger.

The excess of the estimated fair value of net assets acquired over the consideration paid for Aviragen resulted in a bargain purchase gain, which is included in the statement of operations. This is a non-cash item..

First Quarter 2018 and Recent Highlights:

Corporate:

First Quarter 2018 Financial Results:

AmpliPhi Biosciences Reports First Quarter 2018 Financial Results and Business Highlights

On May 15, 2018 AmpliPhi Biosciences Corporation (NYSE American: APHB), a clinical-stage biotechnology company focused on precisely targeted bacteriophage therapeutics for antibiotic-resistant infections, reported financial results for the first quarter ended March 31, 2018 (Press release, AmpliPhi Biosciences, MAY 15, 2018, View Source [SID1234526634]).

"From the ongoing expanded access program, we are gathering initial evidence of safety and efficacy of AB-SA01 and AB-PA01 in patients with serious and life-threatening infections," said Paul C. Grint, M.D., CEO of AmpliPhi Biosciences. "We continue to target a meeting with the FDA in mid-2018 to define a path forward to regulatory approval, with the potential for us to initiate a Phase 2 or registrational clinical study as early as the fourth quarter of 2018."

Recent Business Highlights

Announced positive topline results for the initial seven patients treated with AB-SA01 or AB-PA01 under the ongoing single-patient expanded access program. Six of the seven patients (86%) achieved treatment success (physician’s assessment), defined as complete resolution or significant improvement of baseline signs and symptoms. All patients were severely ill with life-threatening infections and unresponsive to antibiotics at the time of treatment. Treatment was well tolerated in all patients, with over 500 doses administered intravenously or by inhalation.
Announced the presentation at the International Society of Heart and Lung Transplant Annual Meeting in April 2018, describing the case of a lung transplant recipient suffering from recurrent episodes of multidrug-resistant Pseudomonas aeruginosa pneumonia who received treatment with bacteriophage therapeutics, including AB-PA01. The patient clinically responded to bacteriophage and antibiotic therapy with resolution of pneumonia and improved respiratory status.
Signed a Cooperative Research and Development Agreement (CRADA) with the U.S. Department of Veterans Affairs and a collaboration with the Western Sydney Local Health District and the Westmead Institute for Medical Research covering expanded access to AB-SA01 and AB-PA01 for patients with serious and life-threatening infections unresponsive to antibiotics.
Completed a public offering of 4,000,000 shares of common stock in January 2018, at a price to the public of $1.00 per share, for gross proceeds of $4.0 million and a registered direct offering of common stock in March 2018, at a price of $1.10 per share, for gross proceeds of $3.0 million.
First Quarter 2018 Financial Results

Research and development (R&D) expenses for the first quarter of 2018 and for the first quarter of 2017 were $1.5 million.
General and administrative (G&A) expenses were $1.6 million for the first quarter of 2018 compared to $1.9 million for the first quarter of 2017. The decrease was primarily due to lower legal and professional fees as well as a decrease in non-cash stock-based compensation.
Net cash used in operating activities for the three months ended March 31, 2018 was $3.5 million compared to $3.3 million for the three months ended March 31, 2017.
Cash and cash equivalents as of March 31, 2018 totaled $8.2 million.
As of May 15, 2018, there were 16.5 million shares of common stock outstanding.
Conference Call and Webcast

AmpliPhi will hold a conference call today beginning at 4:30 p.m. Eastern time (1:30 p.m. Pacific time). The conference call dial-in number is (866) 652-5200 for domestic callers and (412) 317-6060 for international callers, and the passcode is 10120002. A live webcast of the call will be available on the Investor Relations section of www.ampliphibio.com.

A recording of the call will be available for 48 hours beginning approximately two hours after the completion of the call by dialing (877) 344-7529 for domestic callers and (412) 317-0088 for international callers. Please use passcode 10120002 to access the recording. A webcast replay will be available on the Investor Relations section of www.ampliphibio.com for 30 days, beginning approximately two hours after the completion of the call.

Altimmune Announces First Quarter 2018 Financial Results and Provides Corporate Update

On May 15, 2018 Altimmune, Inc. (Nasdaq:ALT), a clinical-stage immunotherapeutics company, reported financial results for the three months ended March 31, 2018 (Press release, Altimmune, MAY 15, 2018, View Source [SID1234526633]).

Recent Corporate Highlights

Announced positive proof-of-concept data from its Phase 2a intranasal flu vaccine trial with NasoVAX vaccine when compared with a licensed injectable seasonal flu vaccine;
Announced positive pre-clinical data for survival and immunogenicity from the Company’s Phase 2 SparVax-L program when compared against BioThrax to prevent anthrax infection;
Extended its IP protection of NasoShield in the U.S. with a Notice of Allowance from the U.S. Patent Office; and
Consolidated multiple Gaithersburg sites, including laboratory buildout, into new headquarters in Gaithersburg.
"We have had a very data-rich few months with results being reported from our NasoVAX, HepTcell, and SparVax-L programs," said William J. Enright, Chief Executive Officer of Altimmune. "The positive results from our NasoVAX trial give us strong confidence that we have a truly novel approach to combat flu and we look forward to getting Phase 2b clinical trials started next year. NasoVAX has tremendous potential as an effective, easy-to-administer flu vaccine that could provide better protection than current vaccines."

"We are also excited by the results on our SparVax-L study where two doses of SparVax-L produced levels of protective immunity that were significantly greater than that obtained following two doses of the licensed vaccine and we look forward to moving that program forward once we secure additional government funding," Mr. Enright added. "We continue to evaluate our HepTcell results and will update investors on our next steps after we complete the data analysis from the remaining timepoints and better understand our initial results. Operationally, we are focused on executing and moving our programs forward towards licensure as we believe our vaccines offer significant advantages."

Financial Results for the first-quarter of 2018

Revenues for the first-quarter of 2018 were $2.7 million compared to $0.3 million for the same period in 2017. The change was primarily due to a $1.6 million increase in revenue from our contract with the Biomedical Advanced Research and Development Authority ("BARDA") compared to the same period in 2017. Revenue for first-quarter 2018 also included $0.8 million from a contract with the National Institute of Allergy and Infectious Disease ("NIAID").

Research and development expenses were $5.7 million for the first-quarter of 2018 as compared to $2.8 million for same period in 2017. The change was due to an increase of $1.2 million in spending on the development of the NasoShield product candidate; an increase of $0.6 million in HepTcell costs from additional study analysis efforts; an increase of $0.4 million related to the addition of research and development costs of the SparVax-L asset; an increase of $0.3 million in costs due to our NasoVAX Phase 2 trial and an increase of $0.5 million in other research and development costs, compared to the same period in 2017.

General and administrative expenses were $2.4 million for the first-quarter of 2018 as compared with $2.0 million for the same period in 2017. The change was the combined result of an increase of $0.9 million in public company costs, an increase of $0.2 million in salaries and benefits, offset by a decrease of $0.8 million in costs related to the merger with PharmAthene compared to the same period in 2017.

Goodwill impairment charges of $0.5 million reported during the first-quarter of 2018 represented an adjustment recorded during the measurement period to reduce the tax refund receivable acquired in connection with the merger. The adjustment to reduce the tax refund receivable resulted in a corresponding increase in goodwill which was determined to be fully impaired during the year ended December 31, 2017. The non-cash charge has no effect on our current cash balance or operating cash flows.

Net loss attributed to common stockholders for the first-quarter of 2018 was $5.1 million as compared to $4.7 million for the same period in 2017. Excluding the non-cash goodwill impairment charges, net loss attributed to common stockholders for the first quarter of 2018 would have been $4.6 million.

Net loss per share attributed to common stockholders for the first-quarter of 2018 was $0.25 compared with $0.68 for the same period of 2017. Excluding the non-cash goodwill impairment charges, net loss per share attributable to common stockholders for the first quarter of 2018 would have been $0.23, compared to $0.68 for the same period of 2017.

At March 31, 2018, the Company had cash and cash equivalents of $8.1 million

Synlogic Reports First Quarter 2018 Financial Results and Provides Business Update

On May 15, 2018 Synlogic, Inc. (Nasdaq: SYBX), a clinical stage company applying synthetic biology to probiotics to develop novel, living medicines, reported its financial results for the first quarter ended March 31, 2018 (Press release, Synlogic, MAY 15, 2018, View Source [SID1234526619]).

Recent Highlights

Corporate

Leadership Transition: On May 10, 2018, Synlogic announced a CEO transition; Chief Medical Officer, Aoife Brennan, M.B., B.Ch., was appointed to serve as Interim President and Chief Executive Officer as successor to Jose-Carlos Gutiérrez-Ramos, Ph.D.; Peter Barrett, Ph.D., the Chairman of Synlogic’s board of directors will serve as Executive Chairman and oversee a Board committee to conduct a search for a permanent CEO.
Strengthened Company’s balance sheet: As of March 31, 2018, Synlogic had cash, cash equivalents, and short-term investments of $125.8 million. In April 2018, the Company completed a registered direct offering generating $28.9 million in net proceeds. Synlogic expects its current cash, cash equivalents and marketable securities position will be sufficient to fund operations to mid-2020 based on its current business plan.
Pipeline

Treatment of the first subject in a Phase 1/2a clinical trialevaluating SYNB1618, indevelopment for the treatment of phenylketonuria (PKU). This Phase 1/2a clinical trial is a single (SAD) and multiple (MAD) dose-escalation, randomized, double-blind, placebo-controlled study of orally administered SYNB1618 in healthy adult volunteers and adult subjects with PKU. The study is designed to evaluate safety, tolerability, kinetics, and pharmacodynamics as well as exploratory end-points associated with the ability of SYNB1618 to metabolize phenylalanine. Synlogic expects to report interim data from this trial in the second half of 2018 and the full data in 2019. More information about this study can be found at www.clinicaltrials.gov.
Treatment of the first subject in a Phase 1b/2a clinical trial evaluating SYNB1020, in development for the treatment of hyperammonemia. This Phase1b/2a clinical trial is a randomized, double-blind, placebo-controlled study designed to evaluate the safety and tolerability of SYNB1020, as well as its ability to lower blood ammonia levels, in patients with cirrhosis and elevated blood ammonia. Synlogic expects to report topline date from this trial at the end of 2018. Additional information about this study can be found at www.clinicaltrials.gov.
Fast-Track designation granted by the U.S. Food and Drug Administration (FDA) for SYNB1618 for the treatment of PKU. The FDA Fast Track program is designed to facilitate the development of important new drugs intended to treat a serious condition and to fill an unmet medical need. The designation enables early and frequent communication between the FDA and Synlogic ensuring that questions and issues are resolved quickly, and often leading to earlier drug approval and access by patients.
Presentation of preclinical data from Synlogic’s immuno-oncology (IO) program at the annual meeting of the American Association for Cancer Research (AACR) (Free AACR Whitepaper). The data demonstrate that, in mouse models, Synthetic Biotic medicines stimulate an antitumor response and robustly reprogram the tumor microenvironment, potentially enabling the treatment of a variety of cancers.
First Quarter 2018 Financial Results
For the three months ended March 31, 2018, Synlogic reported a consolidated net loss of $11.2 million, or $0.55 per share, compared to a net loss of $7.4 million, or $4.49 per unit, for the corresponding period in 2017. The increase in net loss was primarily due to increases in compensation-related expenses as Synlogic continues to grow its employee headcount and hire into key positions to support its corporate goals, as well as increases in research and development expenses to support its advancing clinical programs.

Research and development expenses were $8.4 million for the three months ended March 31, 2018 compared to $5.1 million for the corresponding period in 2017. The increase was primarily due to an increase in compensation-related expenses associated with increased headcount, increased external costs associated with process and formulation development, pre-clinical and clinical studies and increased costs associated with Synlogic’s move to a larger facility.

General and administrative expenses for the three months ended March 31, 2018 were $3.6 million compared to $2.4 million for the corresponding period in 2017. The increase was primarily due to increases in compensation-related expenses associated with increased headcount and increases in expenses related to being a newly public company, including audit, legal and investor relations.

As of March 31, 2018, Synlogic had cash, cash equivalents, and short-term investments of $125.8 million.

Moleculin Biotech, Inc. Reports Financial Results for the First Quarter Ended March 31, 2018

On May 15, 2018 Moleculin Biotech, Inc., (NASDAQ:MBRX) ("Moleculin" or the "Company"), a clinical stage pharmaceutical company focused on the development of oncology drug candidates, all of which are based on license agreements with The University of Texas System on behalf of the M.D. Anderson Cancer Center, reported its financial results for the first quarter ended March 31, 2018 (Press release, Moleculin, MAY 15, 2018, View Source [SID1234526618]). Additionally, the Company announced potential upcoming milestones and recent corporate developments.

Management Discussion

Walter Klemp, Chairman and CEO of Moleculin, said, "The first quarter of 2018 was very productive as we took important steps to advance the clinical trial of our lead compound, Annamycin for the treatment of relapsed or refractory acute amyloid leukemia ("AML"). We entered into an agreement with The University Hospitals Cleveland Medical Center, which includes the Seidman Cancer Center and the Cleveland Clinic, to participate in our U.S. Phase I/II clinical trial of Annamycin to demonstrate safety and efficacy. The first patients were enrolled and treated without incident beginning in late March 2018. We are also awaiting authorization to proceed with our Annamycin clinical trial in Poland, which, if approved by the Polish National Office, would provide a significant and positive expansion of our trial."

"We are particularly excited with the commencement of the U.S. Annamycin clinical trial because of its unique attributes in treating cancer," continued Mr. Klemp. "Currently approved drugs for AML are limited in their effectiveness by two key flaws: they are often defeated by something called multidrug resistance, which allows cancer cells to build a resistance to the drug, and at the same time, their dosage is limited by their inherent cardiotoxicity, meaning they can do significant and permanent damage to the heart. Annamycin was uniquely designed to avoid these multiple drug resistance mechanisms and exhibits little to no cardiotoxicity. We believe these unique characteristics could make Annamycin an important new treatment option for AML patients."

"Also, during the quarter, we engaged a contract research organization in anticipation of the expansion of the Annamycin clinical trial in Europe; and we entered into an agreement with a European-based manufacturer to begin preparations for commercial scale production of Annamycin as it moves through the approval process.

We remain highly focused on developing treatments for rare and difficult cancers such as AML; glioblastoma; cutaneous T-cell lymphoma, ("CTCL), a deadly form of skin cancer; and pancreatic cancer. We have three highly differentiated technologies with breakthrough potential that, we believe, may effectively treat these difficult cancers. From those three core technologies, we now have six potential oncology drug candidates – one of those drugs is currently in clinical trials – with the possibility of two others commencing clinical trial in 2018. We are off to a good start in the first quarter of 2018 and we look forward to building on that momentum throughout the rest of the year."

First Quarter Highlights and Recent Corporate Developments

Moleculin Announces Engagement with Voisin Consulting Life Sciences to Expand Annamycin Clinical Trial – May 03, 2018, the Company announced that it has engaged Voisin Consulting Life Sciences ("VCLS"), as an additional regulatory consulting firm and contract research organization to prepare for expansion of its clinical trial to study Annamycin for the treatment of relapsed or refractory AML. VCLS headquartered in Paris, France will evaluate Australia and selected Western European countries for the potential expansion of clinical sites for the Company’s AML clinical trial.

Moleculin Announces New Data for Immuno-Stimulating Drug to be Presented at International Conference – April 26, 2018, the Company announced that Dr. Waldemar Priebe, Chair of the Company’s Scientific Advisory Board, has been selected to present findings on Moleculin’s STAT3 inhibitor and immune-stimulating agent, WP1066, at the Global Academic Programs ("GAP") 2018 in Stockholm, Sweden from May 15 to 17, 2018. The annual GAP Conference provides a forum for faculty from MD Anderson and its Sister Institutions to develop collaborations and exchange research results and ideas. The GAP 2018 Conference is being sponsored by a prestigious list of major pharmaceutical companies, including Roche, Bayer, Bristol-Meyers Squibb, AstraZeneca, Novartis, Merck and Pfizer.

Moleculin Enters Agreement with BSP Pharmaceuticals for its Leukemia Drug Candidate – April 24, 2018, the Company announced that it has entered into an agreement with BSP Pharmaceuticals S.p.A to expand production capability for Annamycin. BSP Pharmaceuticals S.p.A., based in Latina, Italy will begin preparations for commercial scale production of the Annamycin drug product. BSP has a solid track record for supplying liposomal formulations to large pharmaceutical companies.

Moleculin Announces Patients Treated in FDA Approved Phase I/II Annamycin Clinical Trial – April 04, 2018, the Company announced that patients have successfully begun treatment in its U.S. Phase I/II clinical trial of Annamycin for the treatment of relapsed or refractory AML. The first patient enrolled in Moleculin’s Annamycin clinical trial was treated at The University Hospitals Cleveland Medical Center Seidman Cancer Center on March 28, 2018.

Moleculin Enters Agreement with Seidman Cancer Center to Conduct Leukemia Clinical Trials Patient -March 27, 2018, the Company announced that it has entered an agreement with The University Hospitals Cleveland Medical Center, which includes the Seidman Cancer Center and the Cleveland Clinic, to participate in its U.S. Phase I/II clinical trial of Annamycin for the treatment of relapsed or refractory AML. Patient enrollment has begun in the Phase I/II trial to demonstrate the safety and effectiveness of Annamycin in the treatment of AML in a U.S. clinical trial.

Moleculin Announces Grant-Funded Collaboration to Expand Understanding of New Discovery – March 20, 2018, the Company announced it has entered into a collaboration with a team of scientists in Poland who have received a $300,000 research grant to expand the understanding of how Moleculin’s leading STAT3 inhibitor WP1066 and the Company’s newly discovered drug candidate, WP1732, create a blockade of transcription factor STAT3 leading to tumor cell death and immune-stimulating effects.

Moleculin Announces Pricing of $9 Million Registered Direct Offering – February 16, 2018, the Company announced that it has entered into a definitive agreement with institutional investors for a registered direct offering of securities with gross proceeds of approximately $9 million.

Moleculin Announces Breakthrough Discovery of a New Molecule for Cancer Treatment – February 15, 2018, the Company announced that, pursuant to its continued collaboration with MD Anderson it has developed and licensed what it believes, based on preclinical testing, is a major breakthrough in its effort to develop a new cancer treatment that selectively kills highly resistant tumors. Specifically, the Company has preclinical evidence to suggest it is capable of influencing a process known as ‘ubiquitination’ to block the activated form of STAT3, an important oncogenic transcription factor. The lead molecule resulting from this new discovery is called WP1732 and it not only appears to share the same key mechanistic properties with WP1066, it has markedly different organ distribution and its dramatically increased solubility makes it ideal for administration via standard IV injection. Importantly, preclinical testing has also shown that WP1732’s properties make it a promising candidate for treating pancreatic cancer.

Moleculin Announces Collaboration with Emory University to Develop Novel Treatment of Pediatric Brain Cancer – February 13, 2018, the Company announced it has entered into an agreement with Emory University to enable expanded cancer research on Moleculin’s WP1066 molecule for the possible treatment of medulloblastoma, a pediatric malignant primary brain tumor. Physician-scientists at Emory University and Children’s Healthcare of Atlanta have requested support to continue research aimed at the development of a novel treatment of medulloblastoma using WP1066 and Moleculin has agreed to supply them with a pure form of WP1066 for preclinical testing for the potential future treatment of patients with the disease. Emory studies so far have indicated that medulloblastoma may be particularly vulnerable to the ability of WP1066 to block the activated form of STAT3, a key signaling protein believed to contribute to the growth and survival of many tumors, including medulloblastoma.

Moleculin Announces Activity with Pancreatic Cancer Drug – February 7, 2018, the Company announced it has been able to show promising tumor suppression activity with its inhibitor of glycolysis, WP1122. The Company’s glycolysis inhibitors have shown a remarkable affinity for concentrating in the pancreas and has solid data showing the ability of WP1122 to inhibit pancreatic tumor growth in mice.

Leading Leukemia Experts Join Moleculin’s Science Advisory Board – January 17, 2018, the Company
announced the expansion of its Science Advisory Board to include Drs. Jorge Cortes and Elihu Estey.

Jorge Cortes, M.D., is deputy chair and professor of medicine in the Department of Leukemia at MD Anderson Cancer Center where he directs the CML and AML Programs. Dr. Cortes received his medical degree in 1986 from the Universidad Nacional Autonoma de Mexico, and has been at MD Anderson since 1991. Dr. Cortes, whose clinical interest focuses on new drug development and the management of patients with myelodysplatic syndromes, acute and chronic leukemias, and myeloproliferative disorders, has authored over 900 peer-reviewed medical publications in top-tier journals including New England Journal of Medicine, Lancet Oncology, Lancet Hematology, Journal of Clinical Oncology, Leukemia, Blood and many others.

Elihu Estey, M.D., is a Professor of Medicine in the Division of Hematology at the University of Washington School of Medicine and a Full Member and Director of AML Clinical Research (non-transplant) Clinical Research Division, Fred Hutchinson Cancer Research Center. Dr. Estey has built a distinguished career in cancer research approaching 40 years of active clinical practice with AML patients, providing mentorships for many physicians that have risen to prominence in AML, lectured globally to professional audiences on cancer research and published more than 700 articles on hematologic malignancies, specifically on AML. Additionally, Dr. Estey serves on the European Leukemia Net (ELN) guidelines committee for AML and has served as an advisor for AML studies to the Oncology Drugs Advisory Committee of the FDA.

Moleculin Expands Leukemia Development Portfolio with Immuno-Stimulating STAT3 Inhibitor – January 10, 2018, the Company announced it has expanded the Company’s development pipeline for the treatment of AML with an immuno-stimulating STAT3 inhibitor. Leading experts in the treatment of AML, Dr. Jorge Cortes and Dr. Sanjay Awasthi requested the Company to expand its clinical research to include WP1066, an immuno-stimulating agent and STAT3 inhibitor, to increase therapeutic options for AML patients. This would potentially be complementary and synergistic with Annamycin and existing first line treatments.

Anticipated Milestone Potential Timeframe
Announcement that our IND for Annamycin has become effective and that we may begin clinical trials Accomplished
Initial IRB (Institutional Review Board) approvals and site initiations of various clinical sites participating in our Phase I/II clinical trial of Annamycin Accomplished and ongoing through Second Half of 2018
Establishment of a new Recommended Phase 2 Dose for Annamycin Second Half of 2018
A clinician sponsored IND for WP1066 for treatment of adult brain tumors moving forward IND Accomplished; Trial expected to begin First Half of 2018
Announcement of initial clinical data for Annamycin trial 2018
Announcement of further benefits of our sponsored research agreement with MD Anderson Accomplished and Ongoing into 2019
Announce CTA for WP1220 for the treatment of cutaneous T-cell lymphoma (CTCL) 2018
Announce WP1122 and WP1732 move into preclinical work 2018
Announce the fourth drug approved for clinical trial 2019
Financial Results for the First Quarter Ended March 31, 2018

Research and Development Expense. Research and development (R&D) expense was $1.2 million and $0.7 million for the three months ended March 31, 2018 and 2017, respectively. The increase of approximately $0.5 million mainly represents an increase of approximately: $0.2 million related to an increase in R&D associated headcount costs; $0.1 million for sponsored research and related expenses; and, approximately $0.2 million associated with developing and testing drug product as we prepared our IND for Annamycin and for the related clinical trials.

General and Administrative Expense. General and administrative expense was $1.4 million and $0.8 million for the three months ended March 31, 2018 and 2017, respectively. The increase of approximately $0.6 million was mainly attributable to the increase in headcount and associated payroll costs of $0.3 million; $0.1 million of stock-based compensation; and, approximately $0.2 million in other expenses. Such increases are due to the increased corporate activity as the Company enters clinical trials.

Net Loss. The net loss for the three months ended March 31, 2018 was $1.9 million which included non-cash income of $0.2 million related to stock-based compensation and other stock-based expenses.

Liquidity and Capital Resources

As of March 31, 2018, the Company had $13.1 million in cash and cash equivalents. On February 16, 2018, the Company entered into a Securities Purchase Agreement with certain institutional investors for the sale by us of 4,290,000 shares of our common stock, at a purchase price of $2.10 per share. Concurrently with the sale of the common shares, pursuant to the Purchase Agreement, we also sold warrants to purchase 2,145,000 shares of common stock. We sold the common shares and warrants for aggregate gross proceeds of approximately $9.0 million. Subject to certain beneficial ownership limitations, the warrants will be initially exercisable on the six-month anniversary of the issuance date at an exercise price equal to $2.80 per share of common stock, subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five years from the initial exercise date. The closing of the sales of these securities under the Purchase Agreement occurred on February 21, 2018. The net proceeds from the transactions was approximately $8.2 million after deducting certain fees due to the placement agent and transaction expenses. The net proceeds will be used for planned clinical trials, preclinical programs, for other research and development activities and for general corporate purposes. The Company believes that its existing cash and cash equivalents as of March 31, 2018 will be sufficient to fund our planned operations into the first quarter of 2019. Such plans are subject to change depending on clinical enrollment progress and use of drug product.