‣ Partnership/Sale of Dermatology and Ophthalmology Programs – TBD
‣ Expansion of collaboration with Helmholtz Zentrum München & Medigene – March 2020
‣ IND enabling study results for PH-762 – 2020
‣ PH-762 (ACT – Melanoma with partner) into clinic – 2H:20
‣ PH-762 (IT – Melanoma) – 2021
‣ PH-804 (ACT – with partner) – 2021
First Quarter 2020 Financial & Operational Update
Phio Pharmaceuticals Corp. (NASDAQ:PHIO) reported first quarter 2020 results and filed its Form 10-Q on May 12, 2020. Year to date, Phio has continued to generate valuable preclinical data supporting Intasyl’s use in immuno-oncology and forge new or expanded collaborations with Helmholtz Zentrum München, Medigene, Karolinska Institutet and Carisma Therapeutics. In May, Phio announced participation in several upcoming events to present data to the scientific and investment community. The company was also able to raise additional capital in preparation for clinical trials later this year. Phio is dependent upon its partners for advancing PH-762 for adoptive cell therapy (ACT) and anticipates this candidate will enter the clinic by 2H:20. The company is also advancing its internal program for intra-tumoral injection for the same candidate.
As of March 31, 2020, cash stood at $13.3 million and debt remained at zero. Cash burn was ($2.2) million for the quarter, similar to the amount in the comparable period. Cash from financing was a net $8.5 million reflecting the issuance of stock and warrants and the proceeds from warrant exercise. Following the end of the reporting period, Phio announced an additional capital raise of $4.0 million in gross proceeds. Phio management expects current cash reserves to sustain the company for at least the next 12 months.
New Intasyl Data
On March 31st, Phio reported continuing preclinical evidence of Intasyl-enabled compounds effectively reducing tumor-microenvironment (TME) immunosuppression. Details of the findings will be presented at an upcoming scientific conference. A mouse version of PH-762 and PH-894 were injected intra-tumorally into a murine model of hepatocellular carcinoma and compared to a placebo arm. The Intasyl compound completely inhibited tumor growth in contrast to the placebo-treated animals which experienced exponential tumor growth. The work showed that PH-762 and PH-894 can penetrate solid tumors and reduce tumor growth by activating the immune response in an animal model. PH-762 inhibits PD-1 receptor expression in T cells while PH-894 silences the expression of bromodomain-containing protein 4 (BRD4), which impacts cell differentiation. This compound has demonstrated an ability to improve T cell function and persistence by differentiating T cells into an effector memory phenotype.
One of the bright spots for Phio has been the collaborations forged over the last year. New and existing partners continue to leverage the Intasyl platform to execute on their own cutting-edge technologies. Phio’s leading efforts include ACT, intra-tumoral injection, chimeric antigen receptor macrophages (CAR-M) and the development of a combination therapy in immuno-oncology (IO). In March 2020, the company called upon Medigene’s expertise to assist in the development of clinical candidates in conjunction with Helmholtz Zentrum München.
Exhibit I – Recent Partnerships and Partnership Expansions (1)
Phio’s pipeline includes lead candidate PH-762 for melanoma and PH-804 for a variety of immuno-oncology targets as well as other compounds focused on checkpoint receptor inhibition, adoptive cell therapy (ACT) and tumor microenvironment. Cell differentiation is another program that is seeking to extend the life of modified immune cells to combat exhaustion.
Exhibit II – Phio INTASYL Immuno-Oncology Pipeline (2)
Phio continues to advance its pipeline towards the clinic and engage in additional collaborations. There are many synergies among the targeted indications in preclinical work which should reduce costs and provide the greatest number of ultimate options for Intasyl development. Immuno-oncology is an attractive area for development as the FDA frequently provides preferential consideration for candidates pursuing a cancer indication and there is broad demand for therapies in this domain. Phio’s Intasyl platform has many favorable characteristics including low cost, a high degree of safety, and the ability to enhance the IP of partner products among other benefits. Phio has indicated that they maintain sufficient cash to support activity for the next year, a runway that may be extended with funds generated from asset sales or accessing funds under purchase agreements.
We think it is necessary for the company to develop a partnership with a peer that can provide both funding and validation of Phio’s projects. A partnership will also have the benefit of increasing investor interest in the company. While Phio has an impressive portfolio with clinical data supportive of safety and efficacy, financial support will be critical to their ultimate success. As it is too early to assign a valuation to the immuno-oncology platform, we continue to base our current valuation on the Phase II assets RXI-109 and Samcyprone. We remind investors that we attach a value to development programs as they enter the clinic and will assign a value to PH-762 and PH-804 at that time.
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1. Table created by the author
2. Source: Phio Corporate Presentation, January 2020