IRVINE, California,
Nov. 8, 2017 /PRNewswire/ -- Novus
Therapeutics, Inc. (NASDAQ: NVUS), a development stage specialty
pharmaceutical company focused on the development of products for
disorders of the ear, nose, and throat (ENT), announced financial
results for the quarter ended September 30,
2017.
For the third quarter of 2017, Novus reported a net loss of
$3.0 million, or $0.43 loss per share, compared to a net loss of
$2.0 million, or $4.35 loss per share, for the same period in
2016. For the nine months ended September 30, 2017, Novus reported a net loss of
$11.0 million, or $2.25 loss per share, as compared to a net loss
of $4.1 million, or $9.09 loss per share, for the first nine months
of 2016. Novus ended the third quarter 2017 with $19.1 million in cash and cash equivalents.
Research and development (R&D) expenses were $517,000 during the third quarter of 2017
compared to $1.1 million for the same
period in 2016. For the nine months ended September 30, 2017, R&D expenses were
$1.5 million, compared to
$2.3 million for the same period in
2016. The decrease in R&D expense for both periods is
primarily due to decreased spending towards the OP-01 program,
offset by wind-down costs incurred for legacy Tokai programs.
We expect R&D expenses to increase in subsequent periods as we
advance our OP-02 program.
General and administrative (G&A) expenses were $2.5 million for the third quarter of 2017
compared to $0.6 million for the
third quarter of 2016. For the nine months ended September 30, 2017, G&A expenses were
$9.5 million, compared to
$1.3 million for the first nine
months of 2016. The increase in G&A expense for both
periods is primarily due to merger related expenses of $7.2M, plus legal costs associated with the
legacy Tokai litigation and administrative costs associated with
operating as a publicly traded company.
"We are continuing formulation development and clinical planning
activities for our OP-02 program and we are expecting to begin our
clinical trials in 2018," said Gregory J.
Flesher, Chief Executive Officer of Novus
Therapeutics. "As a potential first-in-class treatment option
to both treat and prevent otitis media, OP-02 has the ability to
dramatically improve the lives of millions of patients around the
world."
About Novus Therapeutics
Novus Therapeutics is a development stage specialty
pharmaceutical company focused on the development of products for
disorders of the ear, nose, and throat (ENT). Novus has two
technologies, each of which has the potential to be developed for
multiple ENT indications. The company's lead product (OP-02)
is a surfactant-based, combination drug product being developed as
a potential first-in-class treatment option for patients at risk
for or with otitis media ("OM") (middle ear inflammation and
effusion with or without infection). Globally, OM affects
more than 700 million adults and children every year. OM is a
common disorder seen in pediatric practice, and in the United States is the most frequent reason
children are prescribed antibiotics and undergo surgery.
Novus also has a foam-based drug delivery technology (OP-01), which
may be developed in the future to deliver drugs into the ear,
nasal, and sinus cavities. For more information please visit
novustherapeutics.com.
Forward-looking Statements
Any statements in this press release about the company's future
expectations, plans and prospects, including statements about its
strategy, future operations, development of its product candidates,
the review of strategic alternatives and the outcome of such review
and other statements containing the words "believes,"
"anticipates," "plans," "expects," "may," and similar expressions,
constitute forward-looking statements within the meaning of The
Private Securities Litigation Reform Act of 1995. Forward-looking
statements include, but are not limited to, expectations regarding
the timing for the commencement and completion of our clinical
trials and our ability to accelerate the development of our drug
candidates. Actual results may differ materially from those
indicated by such forward-looking statements as a result of various
important factors, including: the sufficiency of the company's cash
resources; the ability to timely develop and manufacture clinical
batches of our study drugs; the ability to obtain necessary
approvals to commence additional clinical trials; whether data from
early clinical trials will be indicative of the data that will be
obtained from future clinical trials; whether the results of
clinical trials will warrant submission for regulatory approval of
any investigational product, any such submission will receive
approval from the United States Food and Drug Administration or
equivalent foreign regulatory agencies and, if we are able to
obtain such approval for an investigational product, it will be
successfully distributed and marketed. Any forward-looking
statements contained in this press release speak only as of the
date hereof and not of any future date, and the company expressly
disclaims any intent to update any forward-looking statements,
whether as a result of new information, future events or
otherwise.
Investor Contacts
The Trout Group
Gita Ogawa
Tel: (646) 378-2949
gogawa@troutgroup.com
Novus Therapeutics, Inc.
Investor Relations
Tel: (949) 238-8090
investors@novustherapeutics.com
|
NOVUS
THERAPEUTICS, INC.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In thousands,
except share and per share data)
|
|
|
|
September
30,
2017
(Unaudited)
|
|
|
December
31,
2016
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
19,094
|
|
|
$
|
1,103
|
|
|
Restricted
cash
|
|
|
—
|
|
|
|
14
|
|
|
Prepaid expenses and
other current assets
|
|
|
1,941
|
|
|
|
33
|
|
|
Total current
assets
|
|
|
21,035
|
|
|
|
1,150
|
|
|
Property and
equipment, net
|
|
|
47
|
|
|
|
31
|
|
|
Restricted
cash
|
|
|
70
|
|
|
|
—
|
|
|
Goodwill
|
|
|
1,867
|
|
|
|
—
|
|
|
Other
assets
|
|
|
—
|
|
|
|
15
|
|
|
Total
assets
|
|
$
|
23,019
|
|
|
$
|
1,196
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
189
|
|
|
$
|
338
|
|
|
Accrued
severance
|
|
|
963
|
|
|
|
—
|
|
|
Accrued expenses and
other liabilities
|
|
|
1,154
|
|
|
|
113
|
|
|
Convertible
notes
|
|
|
—
|
|
|
|
3,447
|
|
|
Total current
liabilities
|
|
|
2,306
|
|
|
|
3,898
|
|
|
Long-term
liabilities
|
|
|
94
|
|
|
|
—
|
|
|
Total
liabilities
|
|
|
2,400
|
|
|
|
3,898
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
(deficit):
|
|
|
|
|
|
|
|
|
|
Preferred stock,
$0.001 par value, 5,000,000 shares authorized and none issued and
outstanding at September 30, 2017; preferred stock, $0.0026 par
value, 6,565,540 shares authorized and 452,706 shares issued and
outstanding at December 31, 2016
|
|
|
—
|
|
|
|
11
|
|
|
Common stock, $0.001
par value, 200,000,000 shares authorized and 6,943,058 shares
issued and outstanding at September 30, 2017; common stock, $0.0026
par value, 9,207,060 shares authorized and 82,246 shares issued and
outstanding at December 31, 2016
|
|
|
7
|
|
|
|
1
|
|
|
Additional paid-in
capital
|
|
|
46,008
|
|
|
|
11,385
|
|
|
Receipts on account
of Preferred A stock
|
|
|
—
|
|
|
|
291
|
|
|
Accumulated
deficit
|
|
|
(25,396)
|
|
|
|
(14,390)
|
|
|
Total stockholders'
equity (deficit)
|
|
|
20,619
|
|
|
|
(2,702)
|
|
|
Total liabilities and
stockholders' equity (deficit)
|
|
$
|
23,019
|
|
|
$
|
1,196
|
|
|
NOVUS
THERAPEUTICS, INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
|
|
(Unaudited)
|
|
(In thousands,
except share and per share data)
|
|
|
|
Three Months
Ended
September
30,
|
|
|
Nine Months
Ended
September
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
$
|
517
|
|
|
$
|
1,053
|
|
|
$
|
1,529
|
|
|
$
|
2,335
|
|
|
General and
administrative
|
|
|
2,448
|
|
|
|
564
|
|
|
|
9,487
|
|
|
|
1,326
|
|
|
Total operating
expenses
|
|
|
2,965
|
|
|
|
1,617
|
|
|
|
11,016
|
|
|
|
3,661
|
|
|
Loss from
operations
|
|
|
(2,965)
|
|
|
|
(1,617)
|
|
|
|
(11,016)
|
|
|
|
(3,661)
|
|
|
Other income
(expense), net
|
|
|
(5)
|
|
|
|
(418)
|
|
|
|
10
|
|
|
|
(479)
|
|
|
Net loss and
comprehensive loss
|
|
$
|
(2,970)
|
|
|
$
|
(2,035)
|
|
|
$
|
(11,006)
|
|
|
$
|
(4,140)
|
|
|
Net loss per share,
basic and diluted
|
|
$
|
(0.43)
|
|
|
$
|
(4.35)
|
|
|
$
|
(2.25)
|
|
|
$
|
(9.09)
|
|
|
Weighted-average
common shares outstanding, basic and diluted
|
|
|
6,943,058
|
|
|
|
81,339
|
|
|
|
3,845,258
|
|
|
|
79,026
|
|
|
NOVUS
THERAPEUTICS, INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Unaudited)
|
|
(In
thousands)
|
|
|
|
Nine Months
Ended
September
30,
|
|
|
|
2017
|
|
|
2016
|
|
|
Operating
activities
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(11,006)
|
|
|
$
|
(4,140)
|
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
18
|
|
|
|
16
|
|
|
Stock-based
compensation
|
|
|
386
|
|
|
|
142
|
|
|
Loss on disposal of
fixed assets
|
|
|
31
|
|
|
|
—
|
|
|
Fair value of debt in
excess of proceeds
|
|
|
—
|
|
|
|
517
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Prepaid expenses and
other assets
|
|
|
(761)
|
|
|
|
42
|
|
|
Accounts payable and
accrued expenses
|
|
|
(998)
|
|
|
|
(218)
|
|
|
Net cash used in
operating activities
|
|
|
(12,330)
|
|
|
|
(3,641)
|
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
|
Cash received from
merger transaction
|
|
|
23,250
|
|
|
|
—
|
|
|
Proceeds from sale of
equipment
|
|
|
8
|
|
|
|
—
|
|
|
Purchase of property
and equipment
|
|
|
—
|
|
|
|
(12)
|
|
|
Net cash provided by
(used in) investing activities
|
|
|
23,258
|
|
|
|
(12)
|
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of common stock, net
|
|
|
4,000
|
|
|
|
—
|
|
|
Proceeds from
exercise of warrants
|
|
|
3,119
|
|
|
|
—
|
|
|
Proceeds from
convertible loan
|
|
|
—
|
|
|
|
2,930
|
|
|
Net cash provided by
financing activities
|
|
|
7,119
|
|
|
|
2,930
|
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
|
|
18,047
|
|
|
|
(723)
|
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
|
|
1,117
|
|
|
|
3,095
|
|
|
Cash, cash
equivalents and restricted cash at end of period
|
|
$
|
19,164
|
|
|
$
|
2,372
|
|
|
Supplemental
disclosure of cash flow information
|
|
|
|
|
|
|
|
|
|
Noncash
activities:
|
|
|
|
|
|
|
|
|
|
Conversion of
promissory notes and interest to common stock
|
|
$
|
3,447
|
|
|
$
|
—
|
|
|
Conversion of
contingently issuable shares to common stock
|
|
$
|
291
|
|
|
$
|
—
|
|
|
Fair value of assets
acquired and liabilities assumed in the merger:
|
|
|
|
|
|
|
|
|
|
Fair value of assets
acquired, excluding cash and restricted cash
|
|
$
|
3,072
|
|
|
|
|
|
|
Fair value of
liabilities assumed
|
|
|
(2,947)
|
|
|
|
|
|
|
Fair value of net
assets acquired in the merger
|
|
$
|
125
|
|
|
|
|
|
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