Purple Biotech Reports Third Quarter 2022 Financial Results

Tel Aviv, ISRAEL


Well capitalized with cash runway through 2024

Clinical progress for both programs, CM24 and NT219

REHOVOT, Israel, Nov. 08, 2022 (GLOBE NEWSWIRE) -- Purple Biotech Ltd. ("Purple Biotech", or the "Company") (NASDAQ/TASE: PPBT), a clinical-stage company developing first-in-class, effective and durable therapies by harnessing the power of the tumor microenvironment to overcome tumor immune evasion and drug resistance, today announced financial results for the third quarter ended September 30, 2022.

“As we prepare for 2023, we are advancing the clinical development of our two lead investigational assets, CM24 and NT219, and exploring additional options to build the Company’s pipeline of first-in-class assets for treatment of cancers with high unmet clinical need,” said Gil Efron, Chief Executive Officer of Purple Biotech. “Purple is well positioned with a cash runway to meet clinical milestones through 2024. In addition to our financial results, we are proud to provide our corporate update focused on enhancing our clinical program.”

Corporate Updates

CM24 Study Design Update

The Company has amended the Phase 2 clinical trial evaluating the use of its monoclonal antibody CM24, a new immune checkpoint inhibitor, in combination with the PD-1 inhibitor Opdivo® (nivolumab) plus chemotherapy for patients with 2L metastatic pancreatic cancer (PDAC). The clinical trial design has been amended to randomize the study comparing CM24+nivolumab+standard-of-care (SoC) chemotherapy against SoC chemotherapy alone. The study is ongoing, and patients are already being treated in a run-in portion of the study, which includes up to 18 patients followed by approximately 60 patients in the randomized part of the study. Interim analysis expected in the second half of 2023 and a topline report on the overall study at the end of 2024.

NT219 Study Progress

In the monotherapy arm of the Phase 1/2 clinical trial for NT219, participants are being treated at the 50mg/kg dose level, which is the last dose to be evaluated for monotherapy. In the combination arm of NT219+cetuximab of the same study, participants are receiving a 24 mg/kg dose of NT219, the penultimate dose being evaluated in this arm. As this trial progresses, we expect to report the recommended Phase 2 dose (RP2D) for monotherapy in the first quarter of 2023, and RP2D for the combination with cetuximab in the second quarter of 2023.

CFO Appointment

The Purple Biotech team welcomed Lior Fhima, CPA, MBA, as Chief Financial Officer of the Company in November. Mr. Fhima brings deep expertise in financial management in the pharmaceutical industry and strong managerial capabilities. We look forward to his contributions in growing Purple Biotech as we advance our first-in-class oncology assets.

“We anticipate that 2023 will be an important year for Purple Biotech, as we plan to report data from our ongoing clinical programs for our two investigational oncology assets. Additionally, we will continue to pursue potential collaborations and commercial opportunities for CM24 and NT219, as well as acquisitions or collaborations related to other first-in-class oncology therapeutics that may be able to address large unmet clinical needs for patients living with devastating cancers,” added Mr. Efron.

Financial Results for the three Months Ended September 30, 2022

Research and Development Expenses were $3.5 million, an increase of $1.9 million, or 118.8%, compared to $1.6 million in the same period of 2021. The increase was mainly due to an increase of $0.5 million in CMC expenses in support of our clinical studies, an increase of $0.8 million for our clinical trials expenses and $0.3 million in payroll and share based payment expenses in support our growing development activities.

Selling, General and Administrative Expenses were $1.6 million, an increase of $0.2 million, or 14.3%, compared to $1.4 million in the same period of 2021. The increase was mainly due to increase of $0.2 million in payroll expenses.

Operating Loss was $5.1 million, an increase of $2.1 million, or 66.67%, compared to $3.0 million in the same period of 2021. The increase was mainly due to the increase in research and development expenses.

On a non-IFRS basis (as reconciled below), adjusted operating loss was $4.4 million, an increase of $1.7 million, compared to $2.7 million in the same period of 2021.

Net Loss for the three months ended September 30, 2022 was $4.8 million, or $0.27 per basic and diluted ADS, compared to a net loss of $3.1 million, or $0.17 per basic and diluted ADS, in the three months ended September 30, 2021. Adjusted net loss for the three months ended September 30, 2022 was $4.1 million, an increase from $2.6 million in the three months ended September 30, 2021.

Financial Results for the Nine Months Ended September 30, 2022

Research and Development Expenses were $11.5 million, an increase of $2.9 million, or 33.7%, compared to $8.6 million in the same period of 2021. The increase was mainly due to an increase of $1.06 million in CMC expenses in support of our clinical studies, an increase of $0.9 million for our clinical trials expenses and $0.7 million in payroll and share based payment expenses in support our growing development activities. 

Sales, General and Administrative Expenses were $4.5 million, compared to $4.6 million in the same period of 2021, a decrease of $0.1 million.

Operating Loss from continuing operations was $16 million, an increase of $2.8 million, or 21.2%, compared to $13.2 million in the same period of 2021. The increase was mainly due to the increase in research and development expenses.

On a non-IFRS basis (as reconciled below), adjusted operating loss was $14.4 million, an increase of $3.0 million, compared to $11.4 million in the same period of 2021, mainly due to an increase in R&D expenses.

Net Loss for the first nine months ended September 30, 2022 was $15.7 million, or $0.87 per basic and diluted ADS, compared to a net loss of $13 million, or $0.75 per basic and diluted ADS, in the same period of 2021. The increase in net loss was mainly due to an increase of $2.8 million in operating expenses. Adjusted net loss for nine months ended September 30, 2022 was $14.1 million, an increase from $11.3 million in the nine months ended September 30, 2021.

As of September 30, 2022, the Company had a total amount of $35.7 million in cash, cash equivalent and short and long term deposits.

During the nine months ended September 30, 2022, the Company sold, under the Open Market Sale Agreementsm with Jefferies LLC, approximately 453 thousand ADSs, at an average price of $2.92 per ADS. Net proceeds to the Company, were approximately $1.3 million, net of issuance expenses.

About Purple Biotech 

Purple Biotech Ltd. is a clinical-stage company developing first-in-class therapies that overcome tumor immune evasion and drug resistance. The Company’s oncology pipeline includes NT219 and CM24. NT219 is a dual inhibitor, novel small molecule that simultaneously targets IRS1/2 and STAT3. In a Phase 1/2 study of NT219, the Company is currently advancing NT219 as a monotherapy treatment of solid tumors, and in a dose escalation of NT219 in combination with cetuximab for the treatment of recurrent and metastatic squamous cell carcinoma of the head and neck cancer (SCCHN) or colorectal adenocarcinoma. These studies will be followed by an expansion phase of NT219 at its recommended Phase 2 level in combination with cetuximab in patients with recurrent and metastatic SCCHN. CM24 is a humanized monoclonal antibody that blocks CEACAM1, an immune checkpoint protein that supports tumor immune evasion and survival through multiple pathways. The Company is advancing CM24 as a combination therapy with anti-PD-1 checkpoint inhibitors in a Phase 2 study for the treatment of pancreatic ductal adenocarcinoma (PDAC). The Company has entered into a clinical collaboration agreement with Bristol Myers Squibb for the Phase 1/2 clinical trials to evaluate the combination of CM24 with the PD-1 inhibitor nivolumab (Opdivo®) in addition to chemotherapy. The Company’s corporate headquarters are located in Rehovot, Israel. For more information, please visit https://purple-biotech.com/.

Forward-Looking Statements and Safe Harbor Statement

Certain statements in this press release that are forward-looking and not statements of historical fact are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements that are not statements of historical fact, and may be identified by words such as "believe", "expect", "intend", "plan", "may", "should", "could", "might", "seek", "target", "will", "project", "forecast", "continue" or "anticipate" or their negatives or variations of these words or other comparable words or by the fact that these statements do not relate strictly to historical matters. You should not place undue reliance on these forward-looking statements, which are not guarantees of future performance. Forward-looking statements reflect our current views, expectations, beliefs or intentions with respect to future events, and are subject to a number of assumptions, involve known and unknown risks, many of which are beyond our control, as well as uncertainties and other factors that may cause our actual results, performance or achievements to be significantly different from any future results, performance or achievements expressed or implied by the forward-looking statements. Important factors that could cause or contribute to such differences include, among others, risks relating to: the plans, strategies and objectives of management for future operations; product development for NT219 and CM24; the process by which early stage therapeutic candidates such as NT219 and CM24 could potentially lead to an approved drug product is long and subject to highly significant risks, particularly with respect to a joint development collaboration; the fact that drug development and commercialization involves a lengthy and expensive process with uncertain outcomes; our ability to successfully develop and commercialize our pharmaceutical products; the expense, length, progress and results of any clinical trials; the impact of any changes in regulation and legislation that could affect the pharmaceutical industry; the difficulty in receiving the regulatory approvals necessary in order to commercialize our products; the difficulty of predicting actions of the U.S. Food and Drug Administration or any other applicable regulator of pharmaceutical products; the regulatory environment and changes in the health policies and regimes in the countries in which we operate; the uncertainty surrounding the actual market reception to our pharmaceutical products once cleared for marketing in a particular market; the introduction of competing products; patents obtained by competitors; dependence on the effectiveness of our patents and other protections for innovative products; our ability to obtain, maintain and defend issued patents; the commencement of any patent interference or infringement action against our patents, and our ability to prevail, obtain a favorable decision or recover damages in any such action; and the exposure to litigation, including patent litigation, and/or regulatory actions, and other factors that are discussed in our Annual Report on Form 20-F for the year ended December 31, 2021 and in our other filings with the U.S. Securities and Exchange Commission ("SEC"), including our cautionary discussion of risks and uncertainties under "Risk Factors" in our Registration Statements and Annual Reports. These are factors that we believe could cause our actual results to differ materially from expected results. Other factors besides those we have listed could also adversely affect us. Any forward-looking statement in this press release speaks only as of the date which it is made. We disclaim any intention or obligation to publicly update or revise any forward-looking statement or other information contained herein, whether as a result of new information, future events or otherwise, except as required by applicable law. You are advised, however, to consult any additional disclosures we make in our reports to the SEC, which are available on the SEC's website, https://www.sec.gov.

CONTACTS:

Company Contact:
Lior Fhima
Chief Financial Officer
IR@purple-biotech.com

Media Inquiries:
Anna Army
Account Supervisor, Integrated Communications
LaVoieHealthScience
T: +1-617-351-0246
aarmy@lavoiehealthscience.com

Purple Biotech Ltd.
Consolidated Unaudited Statements of Financial Position as of:
       
  September 30,  December 31, 
  2022  2021 


 USD thousand  USD thousand 

Assets

      

Cash and cash equivalents

 

11,074

  

10,890

 

Short term deposits

 

22,010

  

36,310

 

Other current assets

 

1,222

  

1,273

 
    

Total current assets

 

34,306

  

48,473

 
    

Non - current assets

   

Other investments

 

187

  

187

 

Right of use assets

 

505

  

619

 

Fixed assets, net

 

220

  

277

 

Long term deposits

 

2,641

  

160

 

Intangible assets

 

20,684

  

20,482

 
    

Total non – current assets

 

24,237

  

21,725

 
    

Total assets

 

58,543

  

70,198

 
    

Liabilities

   

Lease liability - short term

 

193

  

199

 

Accounts payable

 

2,765

  

1,473

 

Other payables

 

2,975

  

2,578

 
    

Total current liabilities

 

5,933

  

4,250

 
    

Non - current liabilities

   

Lease liability

 

357

  

550

 

Post-employment benefit liabilities

 

144

  

292

 
    

Total non-current liabilities

 

501

  

842

 
    

Equity

   

Share capital, no par value

 

-

  

-

 

Share premium

 

125,747

  

123,951

 

Receipts on account of warrants

 

28,018

  

28,017

 

Capital reserve for share-based payments

 

9,803

  

8,862

 

Capital reserve from transactions with related parties

 

761

  

761

 

Capital reserves from hedging

 

(17

)


-

 

Capital reserve from transactions with non- controlling

   

interest

 

(859

)


(859

)

Accumulated loss

 

(111,562

)


(95,905

)

    

Equity attributable to owners of the Company

 

51,891

  

64,827

 

Non-controlling interests

 

219

  

279

 
    

Total equity

 

52,110

  

65,106

 
    

Total liabilities and equity

 

58,543

  

70,198

 


Purple Biotech Ltd.
Consolidated Unaudited Statement of Operations for the nine and three months ended September 30, 2022
 
 For the nine months ended
September 30,
 For the three months ended
September 30,
 
 2022  2021(*)  2022  2021(*) 


USD
thousand

  

USD
thousand

  

USD
thousand

  

USD
thousand

 

Revenues

-

  

  

-

  

-

 
     

Research and development expenses

11,500

  

8,582 

  

3,465

  

1,621

 

Sales, general and administrative expenses

4,502

  

4,613 

  

1,616

  

1,421

 
     

Operating loss

16,002

  

13,195 

  

5,081

  

3,042

 
     

Finance expense

108

  

143 

  

16

  

21

 

Finance income

(393

)


(264

)


(248

)


(68

)

     

Finance expense (income), net

(285

)


(121 

)


(232

)


(47

)

     

Loss for the period from continuing operations

15,717

  

13,074 

  

4,849

  

2,995

 
     

Loss (profit) from discontinued operation

-

  

288

  

-

  

154

 
     

Loss for the period

15,717

  

13,362

  

4,849

  

3,149

 
     

Other Comprehensive Loss:

    

Items that will be transferred to profit

    

or loss:

    
Profit (Loss) from cash flow hedges(17) -  4  - 
     

Total comprehensive loss for the period

15,734

  

13,362

  

4,845

  

3,149

 
     

Loss attributable to:

    

Owners of the Company

15,657

  

13,312 

  

4,824

  

3,137

 

Non-controlling interests

60

  

50 

  

25

  

12

 
     
 

15,717

  

13,362 

  

4,849

  

3,149

 
     

Total comprehensive loss attributable to

    

Owners of the Company

15,674

  

13,312 

  

4,820

  

3,137

 

Non-controlling interests

60

  

50 

  

25

  

12

 
     
 

15,734

  

13,362 

  

4,845

  

3,149

 
     
     
 

For the nine months ended
September 30,


For the three months ended
September 30

  2022   2021(*)   2022    2021(*) 
 

USD
thousand



USD
thousand



USD
thousand



USD
thousand


Loss per share data

           

Continuing operations

    
     

Basic and diluted loss per ADS - USD

0.87

  

0.75 

  

0.27

  

0.17

 
     

Number of ADSs used in calculation

17,977,244

  

17,512,257

  

18,073,331

  

17,626,555

 
     

Discontinued operation

    
     

Basic and diluted loss per ADS - USD

-

  

0.01

  

-

  0.01

 

 

Number of ADSs used in calculation

-

  

17,512,257

  

-

  17,626,555

 

 
     
     

*Restated, see Note 4 discontinued operation in the annual financial statements.

Reconciliation of Adjusted Operating Loss

   

For the nine months ended
September 30,

For the three months ended
September 30,

   

2022

  

2021(*)



2022

  

2021(*)

   

USD
thousand



USD
thousand



USD
thousand



USD
thousand


       

Operating loss for the period

  

16,002

  

13,195

  

5,081

  

3,042

 

Less ESOP expenses

  

(1,573

)


(1,777

)


(707

)


(392

)

   

14,429

  

11,418

  

4,374

  

2,650

 
   


  


  


  


 

Reconciliation of Adjusted Net Loss

   

For the nine months ended
September 30,

 

For the three months ended
September 30,

   

2022

  

2021(*)


 

2022

  

2021(*)


   

USD
thousand


 

USD
thousand


 

USD
thousand


 

USD
thousand


       

Loss for the period from continuing operation

  

15,717

  

13,074

  

4,849

  

2,995

 

Less ESOP expenses

  

(1,573

)


(1,777

)


(707

)


(392

)

   

14,144

  

11,297

  

4,142

  

2,603

 
   


  


  


  


 

* Restated, see Note 4 discontinued operation in the annual financial statements.


Consolidated Unaudited Statements of Cash Flow  
   
 For the nine months ended September 30,
 2022 2021


USD thousand
 USD thousand

Cash flows from operating activities from continuing operation:

  

Loss for the period from continuing operation

(15,717

)


(13,074

)

Adjustments:

  

Depreciation

151

  

170

 

Finance income, net

(285

)


(121

)

Share-based payments

1,573

  

1,777

 
   
 

(14,278

)


(11,248

)

   

Changes in assets and liabilities:

  

Changes in other current assets

(124

)


(195

)

Changes in accounts payables

1,534

  

674

 

Changes in other payables

495

  

(565

)

Changes in post-employment benefit liabilities

(148

)


-

 
 

1,757

  

(86

)

   

Net cash used in operating activities from continuing operation

(12,521

)


(11,334

)

   

Cash flows from investing activities from continuing operation:

  

Acquisition of intangible asset

(202

)


-

 

Interest received

324

  

297

 

Decrease (Increase) in short term deposits

(2,481

)


10,111

 

Decrease (Increase) in long term deposits

14,300

  

(1,946

)

 Acquisition of fixed assets (26)  (115)
      
Net cash provided by investing activities from continuing operation11,915  8,347 
   

Cash flows from financing activities from continuing operation:

  

Proceeds from exercise of warrants

-

  

1,200

 

Proceeds from issuance ADSs

1,312

  

-

 

ADS issuance expenses paid

(114

)


(1

)

Repayment of lease liability

(124

)


(112

)

Interest paid

(49

)


(54

)

   

Net cash provided by financing activities from continuing operation

1,025

  

1,033

 
   


 

For the nine months ended September 30,

 

2022 

 

2021 

 

USD thousand

USD thousand

 

Cash flows in respect of discontinued operation as follows:

  
   
Net cash (used in) provided by operating activities-  (164)

Net cash from investing activities

-   

-

 

Net cash from financing activities

-   

-

 
Net cash provided by (used in) discontinued operation-  (164)
      
Net increase (decrease) in cash and cash equivalents419  (2,118)

Cash and cash equivalents at the beginning of the period

10,890   

11,247

 

Effect of translation adjustments on cash and cash equivalents

(235 )


(12

)

   

Cash and cash equivalents at the end of the period

11,074   

9,117