On August 12, 2022 Xenetic Biosciences, Inc. (NASDAQ:XBIO) ("Xenetic" or the "Company"), a biopharmaceutical company focused on advancing innovative immune-oncology technologies addressing hard to treat oncology indications, reported its financial results for the second quarter of 2022 and provided a business update (Press release, Xenetic Biosciences, AUG 12, 2022, View Source [SID1234618262]).

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"The past quarter was marked by a shift in our focus and prioritization of our pipeline with the in-licensing of our DNase-based oncology platform. With this transaction, we now have a clear path toward a Phase 1 clinical study in pancreatic carcinoma and other advanced solid tumors, creating the potential for value driving regulatory and clinical milestones," commented Jeffrey Eisenberg, Chief Executive Officer of Xenetic. "As a demonstration of our commitment to advance this important program, we engaged Catalent, a preeminent contract development and manufacturing organization, to produce cGMP clinical supply for our planned Phase 1 study. We also entered into a research and development collaboration with Belgian Volition SARL, and we look forward to advancing this exploratory program to develop NETs-targeted adoptive cell therapies. We are focused on executing on our preclinical and clinical development plans and look forward to unlocking the full potential of this oncology platform."

DNase Oncology Platform:Targeting Neutrophil Extracellular Traps ("NETs") to improve cancer therapies with a focus on advancing systemic DNase program into the clinic as an adjunctive therapy for pancreatic carcinoma and other locally advanced or metastatic solid tumors.

Program Highlights:

In April 2022, executed exclusive license and sublicense agreements with CLS Therapeutics to develop its interventional DNase-based oncology platform, which is designed to improve outcomes of existing treatments, including immunotherapies.
Advancing toward planned first-in-human study to evaluate DNase combined with immune checkpoint inhibitors or chemotherapy.
Systemic DNase program initially targeting multi-billion-dollar indications including pancreatic carcinoma.
DNase armored CAR T program focused on demonstrating that armoring CAR T cells to secrete DNase can support depth and durability of response of CAR T therapy against solid tumor indications.
In June 2022, entered into a manufacturing agreement with Catalent Pharma Solutions LLC, which will include cGMP manufacturing of Phase 1 clinical supply.
Subsequent to quarter end, entered into a collaboration agreement with Belgian Volition SARL to develop NETs-targeted adoptive cell therapies for the treatment of cancer.
XCART Platform Technology: Significantly differentiated, proprietary approach to personalized CAR T lymphoma therapy targeting tumor-specific neoantigens that target independently of CD19 or other surface antigens that are common to both normal and malignant B-cells.

Program Highlights:

Bolstered intellectual property portfolio with issuance of a U.S. patent covering the co-administration of XCART-derived CAR T cells, together with a personalized vaccine designed to enhance the effectiveness of the CAR T therapy.
PolyXen Platform Technology: Patent-protected platform technology designed for protein or peptide therapeutics, enabling next-generation biological drugs by prolonging a drug’s circulating half-life and potentially improving other pharmacological properties.

Program Highlight:

Royalty payments of approximately $0.4 million were received in the three months ended June 30, 2022, representing an approximate 45% increase over the same period in 2021 as Takeda’s sublicensee continued its worldwide launch of the product.
Summary of Financial Results for Second Quarter 2022

Net loss for the quarter ended June 30, 2022 was approximately $2.7 million. Research and development ("R&D") expenses for the three months ended June 30, 2022 increased by approximately $1.6 million, or 296.1%, to approximately $2.1 million from approximately $0.5 million in the comparable quarter in 2021 due to in-process research and development ("IPR&D") expense of $1.3 million. During the three months ended June 30, 2022, the Company expensed $1.3 million of IPR&D associated with the Company’s licensing of the DNase platform. There was no similar expense in 2021. Excluding the $1.3 million of IPR&D expense from total R&D expense of $2.1 million, R&D expense for the three months ended June 30, 2022 increased by $0.3 million, or 47.3%, primarily due to increased spending related to our XCART platform technology program. General and administrative expenses for the three months ended June 30, 2022 increased by approximately $0.1 million, or 15.2%, to approximately $1.0 million from approximately $0.9 million in the comparable quarter in 2021. The increase was primarily due to an increase in legal costs related to the licensing of the DNase platform during the three months ended June 30, 2022 compared to the same period in 2021.

The Company ended the quarter with approximately $14.9 million of cash.