Delaware
|
11-3516358
|
|
(State or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S. Employer Identification No.)
|
Large Accelerated Filer
|
☐
|
Accelerated Filer
|
☑
|
Non-Accelerated Filer
|
☐
|
Smaller reporting company
|
☐
|
(Do not check if a smaller reporting company)
|
Page
|
||||
PART I
|
FINANCIAL INFORMATION
|
1
|
||
Item 1
|
1
|
|||
1)
|
1
|
|||
2)
|
2
|
|||
3)
|
3
|
|||
4)
|
4
|
|||
5)
|
5
|
|||
Item 2
|
25
|
|||
Item 3
|
33
|
|||
Item 4
|
33
|
|||
PART II
|
OTHER INFORMATION
|
34
|
||
Item 1A
|
34
|
|||
Item 2
|
34
|
|||
Item 5
|
34
|
|||
Item 6
|
34
|
|||
35
|
PART I. | Financial Information |
ASSETS
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
7,877,995
|
$
|
10,199,440
|
||||
Marketable securities
|
11,519,899
|
13,240,086
|
||||||
Prepaid expenses and other current assets
|
996,083
|
1,221,818
|
||||||
Total Current Assets
|
20,393,977
|
24,661,344
|
||||||
Security Deposits
|
30,785
|
30,785
|
||||||
Equipment, Net
|
105,358
|
112,900
|
||||||
Total Assets
|
$
|
20,530,120
|
$
|
24,805,029
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Accounts payable and accrued expenses
|
$
|
1,794,647
|
$
|
2,661,298
|
||||
Deferred Research and Development Arrangement
|
487,500
|
525,000
|
||||||
Other Liabilities
|
92,595
|
104,020
|
||||||
Warrant Liabilities
|
2,340,978
|
2,739,163
|
||||||
Total Liabilities
|
4,715,720
|
6,029,481
|
||||||
Commitments and Contingencies
(note 14)
|
||||||||
Stockholders’ Equity:
|
||||||||
Preferred stock, par value $0.0001, 100,000,000 authorized shares, none issued and outstanding
|
-
|
-
|
||||||
Common stock, par value $0.0001, 500,000,000 authorized shares, 213,233,785 and 197,413,785 issued and outstanding
|
21,323
|
19,741
|
||||||
Additional paid-in capital
|
127,422,480
|
124,490,712
|
||||||
Accumulated other comprehensive income (loss)
|
2,327
|
(18,041
|
)
|
|||||
Accumulated deficit
|
(111,631,730
|
)
|
(105,716,864
|
)
|
||||
Total Stockholders’ Equity
|
15,814,400
|
18,775,548
|
||||||
Total Liabilities and Stockholders’ Equity
|
$
|
20,530,120
|
$
|
24,805,029
|
For the Three Months Ended
June 30,
|
June 30,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Revenues:
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||||
Expenses:
|
||||||||||||||||
General and administrative
|
1,675,749
|
1,584,852
|
3,071,155
|
3,109,552
|
||||||||||||
Research and development
|
2,237,033
|
3,235,088
|
5,705,607
|
6,128,096
|
||||||||||||
Total Expenses
|
3,912,782
|
4,819,940
|
8,776,762
|
9,237,648
|
||||||||||||
Loss from Operations
|
(3,912,782
|
)
|
(4,819,940
|
)
|
(8,776,762
|
)
|
(9,237,648
|
)
|
||||||||
Other Income (Expense)
|
||||||||||||||||
Interest income
|
28,868
|
27,020
|
57,738
|
57,602
|
||||||||||||
Unrealized gain on fair value of warrants
|
2,118,090
|
1,558,760
|
2,974,045
|
1,674,175
|
||||||||||||
Financing expense
|
-
|
-
|
(169,887
|
)
|
-
|
|||||||||||
Total Other Income (Expense)
|
2,146,958
|
1,585,780
|
2,861,896
|
1,731,777
|
||||||||||||
Net Loss Before Provision for Income Taxes
|
(1,765,824
|
)
|
(3,234,160
|
)
|
(5,914,866
|
)
|
(7,505,871
|
)
|
||||||||
Provision for income taxes
|
-
|
-
|
-
|
-
|
||||||||||||
Net Loss
|
$
|
(1,765,824
|
)
|
$
|
(3,234,160
|
)
|
$
|
(5,914,866
|
)
|
$
|
(7,505,871
|
)
|
||||
Net loss per share, basic and diluted
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
$
|
(0.03
|
)
|
$
|
(0.04
|
)
|
||||
Weighted average number of shares outstanding, basic and diluted
|
213,184,334
|
179,849,433
|
207,885,571
|
179,475,741
|
For the Three Months Ended
June 30,
|
For the Six Months Ended
June 30,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Net Loss
|
$
|
(1,765,824
|
)
|
$
|
(3,234,160
|
)
|
$
|
(5,914,866
|
)
|
$
|
(7,505,871
|
)
|
||||
Unrealized gain on available-for-sale securities
|
3,733
|
4,672
|
20,368
|
39,395
|
||||||||||||
Comprehensive Loss
|
$
|
(1,762,091
|
)
|
$
|
(3,229,488
|
)
|
$
|
(5,894,498
|
)
|
$
|
(7,466,476
|
)
|
For the Six Months Ended June 30,
|
||||||||
2016
|
2015
|
|||||||
Cash Flows from Operating Activities:
|
||||||||
Net loss
|
$
|
(5,914,866
|
)
|
$
|
(7,505,871
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Compensatory stock
|
64,949
|
56,250
|
||||||
Depreciation and amortization
|
15,053
|
12,643
|
||||||
Amortization of premiums and discounts on marketable securities, net
|
22,315
|
13,900
|
||||||
Stock-based compensation
|
694,187
|
544,352
|
||||||
Amortization of deferred research and development arrangement
|
(37,500
|
)
|
(37,500
|
)
|
||||
Unrealized gain on fair value of warrants
|
(2,974,045
|
)
|
(1,674,175
|
)
|
||||
Financing expense
|
169,887
|
-
|
||||||
Amortization of deferred lease incentive
|
(6,222
|
)
|
(6,221
|
)
|
||||
Deferred lease expenses
|
(5,203
|
)
|
(3,290
|
)
|
||||
Changes in assets and liabilities:
|
||||||||
Prepaid expenses and other assets
|
225,735
|
(551,351
|
)
|
|||||
Accounts payable and accrued expenses
|
(866,651
|
)
|
709,545
|
|||||
Net Cash Used in Operating Activities
|
(8,612,361
|
)
|
(8,441,718
|
)
|
||||
Cash Flows from Investing Activities:
|
||||||||
Purchase of equipment
|
(7,511
|
)
|
(12,388
|
)
|
||||
Purchase of marketable securities
|
(1,721,760
|
)
|
(740,825
|
)
|
||||
Redemption of marketable securities
|
3,440,000
|
7,625,000
|
||||||
Net Cash Provided by Investing Activities
|
1,710,729
|
6,871,787
|
||||||
Cash Flows from Financing Activities:
|
||||||||
Issuance of common stock and units, net of issuance costs
|
4,580,187
|
1,005,715
|
||||||
Proceeds from exercise of stock options
|
-
|
708,617
|
||||||
Net Cash Provided by Financing Activities
|
4,580,187
|
1,714,332
|
||||||
Net (Decrease) Increase in Cash and Cash Equivalents
|
(2,321,445
|
)
|
144,401
|
|||||
Cash and Cash Equivalents – beginning of period
|
10,199,440
|
9,826,245
|
||||||
Cash and Cash Equivalents - end of period
|
$
|
7,877,995
|
$
|
9,970,646
|
||||
Supplemental Cash Flow Information
|
||||||||
Non-cash financing and investing activities:
|
||||||||
Warrants issued
|
$
|
2,575,860
|
$
|
-
|
1. | Operations and Organization |
2. | Recent Accounting Pronouncements Affecting the Company |
3. | Marketable Securities |
|
June 30, 2016
|
|||||||||||||||
Cost
Basis
|
Gross
Unrealized
Gains
|
Gross
Unrealized
Losses
|
Fair
Value
|
|||||||||||||
Certificates of Deposit
|
$
|
5,520,000
|
$
|
2,219
|
$
|
(40
|
)
|
$
|
5,522,179
|
|||||||
Commercial Paper
|
2,992,580
|
954
|
(604
|
)
|
2,992,930
|
|||||||||||
Corporate Bonds
|
3,004,992
|
273
|
(475
|
)
|
3,004,790
|
|||||||||||
Total Marketable Securities
|
$
|
11,517,572
|
$
|
3,446
|
$
|
(1,119
|
)
|
$
|
11,519,899
|
December 31, 2015
|
||||||||||||||||
Cost
Basis
|
Gross
Unrealized
Gains
|
Gross
Unrealized
Losses
|
Fair
Value
|
|||||||||||||
Certificates of Deposit
|
$
|
6,240,000
|
$
|
571
|
$
|
(5,575
|
)
|
$
|
6,234,996
|
|||||||
Commercial Paper
|
2,981,307
|
-
|
(3,737
|
)
|
2,977,570
|
|||||||||||
Corporate Bonds
|
4,036,820
|
-
|
(9,300
|
)
|
4,027,520
|
|||||||||||
Total Marketable Securities
|
$
|
13,258,127
|
$
|
571
|
$
|
(18,612
|
)
|
$
|
13,240,086
|
4. | Prepaid Expenses and Other Current Assets |
June 30,
2016
|
December 31,
2015
|
|||||||
Deposits on contracts
|
$
|
199,697
|
$
|
501,170
|
||||
Prepaid expenses and other current assets
|
796,386
|
720,648
|
||||||
$
|
996,083
|
$
|
1,221,818
|
5. | Equipment, Net |
June 30,
2016
|
December 31,
2015
|
|||||||
Furniture and fixtures
|
$
|
78,794
|
$
|
78,794
|
||||
Office and computer equipment
|
112,777
|
105,266
|
||||||
Lab equipment
|
431,650
|
431,650
|
||||||
Leasehold improvements
|
133,762
|
133,762
|
||||||
Total equipment
|
756,983
|
749,472
|
||||||
Less: Accumulated depreciation and amortization
|
(651,625
|
)
|
(636,572
|
)
|
||||
Net carrying amount
|
$
|
105,358
|
$
|
112,900
|
6. | Accounts Payable and Accrued Expenses |
June 30,
2016
|
December 31,
2015
|
|||||||
Trade payables
|
$
|
598,843
|
$
|
774,543
|
||||
Accrued expenses
|
64,139
|
92,752
|
||||||
Accrued research and development contract costs
|
967,930
|
1,515,151
|
||||||
Payroll liabilities
|
163,735
|
278,852
|
||||||
$
|
1,794,647
|
$
|
2,661,298
|
7. | Deferred Research and Development Arrangements |
8. | Other Liabilities |
June 30,
2016
|
December 31,
2015
|
|||||||
Deferred lease incentive
|
$
|
154,660
|
$
|
154,660
|
||||
Less accumulated amortization
|
(117,330
|
)
|
(111,108
|
)
|
||||
Balance
|
$
|
37,330
|
$
|
43,552
|
9. | Net Loss per Common Share |
10. | Common Stock |
Gross Proceeds:
|
$
|
5,000,000
|
||
Allocated to warrant liabilities:
|
2,419,922
|
|||
Allocated to common stock and additional paid-in capital
|
2,580,078
|
|||
Total allocated gross proceeds:
|
$
|
5,000,000
|
11. | Stock-Based Compensation |
For the Three Months
Ended June 30,
|
For the Six Months
Ended June 30,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Statement of operations line item:
|
||||||||||||||||
General and administrative
|
$
|
224,786
|
$
|
175,666
|
$
|
440,113
|
$
|
365,705
|
||||||||
Research and development
|
126,390
|
96,300
|
254,074
|
178,647
|
||||||||||||
Total
|
$
|
351,176
|
$
|
271,966
|
$
|
694,187
|
$
|
544,352
|
Six Months Ended June 30,
|
||||||||
2016
|
2015
|
|||||||
Black-Scholes assumptions
|
||||||||
Expected dividend yield
|
0
|
%
|
0
|
%
|
||||
Expected volatility
|
32-75
|
%
|
77-80
|
%
|
||||
Risk free interest rate
|
0.6-1.4
|
%
|
1.3-1.7
|
%
|
||||
Expected term (in years)
|
2-6 years
|
6 years
|
Number of
Options
|
Weighted
Average
Exercise
Price
|
Weighted Average
Remaining
Contractual Term
|
Aggregate
Intrinsic
Value
|
||||||||||
Outstanding, January 1, 2016
|
12,590,982
|
$
|
0.83
|
6.8 years
|
$
|
26,500
|
|||||||
Granted
|
4,487,090
|
0.33
|
|||||||||||
Exercised
|
-
|
-
|
|||||||||||
Expired
|
(610,000
|
)
|
1.20
|
||||||||||
Cancelled
|
(83,333
|
)
|
0.51
|
||||||||||
Outstanding, June 30, 2016
|
16,384,739
|
$
|
0.68
|
7.4 years
|
$
|
-
|
|||||||
Exercisable, June 30, 2016
|
8,120,929
|
$
|
0.82
|
5.8 years
|
$
|
-
|
2016
|
||||||||
Number of Options
|
Weighted Average Fair
Value at Grant Date
|
|||||||
Unvested at January 1, 2016
|
5,888,432
|
$
|
0.51
|
|||||
Granted
|
4,487,090
|
$
|
0.21
|
|||||
Vested
|
(2,066,504
|
)
|
$
|
0.45
|
||||
Cancelled
|
(45,208
|
)
|
$
|
0.35
|
||||
Unvested at June 30, 2016
|
8,263,810
|
$
|
0.36
|
12. | Warrants |
2016
|
2015
|
|||||||||||||||
Number of warrants
|
Weighted
average exercise
price
|
Number of
warrants
|
Weighted average
exercise price
|
|||||||||||||
Balance, January 1
|
26,491,904
|
$
|
0.80
|
13,205,871
|
$
|
1.07
|
||||||||||
Issued during the period
|
12,500,000
|
$
|
0.42
|
-
|
$
|
-
|
||||||||||
Exercised during the period
|
-
|
$
|
-
|
-
|
$
|
-
|
||||||||||
Expired during the period
|
-
|
$
|
-
|
-
|
$
|
-
|
||||||||||
Balance, June 30
|
38,991,904
|
$
|
0.68
|
13,205,871
|
$
|
1.07
|
Fair Value as of:
|
||||||||
Warrant Issuance:
|
June 30, 2016
|
December 31, 2015
|
||||||
March 31, 2011 financing:
|
||||||||
Warrants to institutional investors
|
$
|
-
|
$
|
30
|
||||
December 4, 2012 financing:
|
||||||||
Warrants to institutional investors
|
2,540
|
9,818
|
||||||
Warrants to placement agent
|
-
|
1,206
|
||||||
July 26, 2013 financing:
|
||||||||
Warrants to institutional investors
|
27,520
|
121,420
|
||||||
Warrants to placement agent
|
-
|
384
|
||||||
October 16, 2013 financing:
|
||||||||
Warrants to institutional investors
|
39,742
|
169,349
|
||||||
Warrants to placement agent
|
-
|
970
|
||||||
January 21, 2014 financing:
|
||||||||
Warrants to institutional investors
|
13,762
|
131,476
|
||||||
November 12, 2015 financing:
|
||||||||
Warrants to institutional investors
|
964,750
|
2,169,375
|
||||||
Warrants to placement agent
|
54,975
|
135,135
|
||||||
March 2, 2016 financing:
|
||||||||
Warrants to institutional investors
|
1,167,656
|
-
|
||||||
Warrants to placement agent
|
70,033
|
-
|
||||||
Total:
|
$
|
2,340,978
|
$
|
2,739,163
|
Number of Shares indexed as of:
|
||||||||
Warrant Issuance
|
June 30, 2016
|
December 31, 2015
|
||||||
March 31, 2011 financing:
|
||||||||
Warrants to institutional investors
|
3,333,333
|
3,333,333
|
||||||
December 4, 2012 financing:
|
||||||||
Warrants to institutional investors
|
174,300
|
174,300
|
||||||
Warrants to placement agent
|
40,000
|
40,000
|
||||||
July 26, 2013 financing:
|
||||||||
Warrants to institutional investors
|
2,000,000
|
2,000,000
|
||||||
Warrants to placement agent
|
124,032
|
124,032
|
||||||
October 16, 2013 financing:
|
||||||||
Warrants to institutional investors
|
2,317,309
|
2,317,309
|
||||||
Warrants to placement agent
|
407,692
|
407,692
|
||||||
January 21, 2014 financing:
|
||||||||
Warrants to institutional investors
|
4,761,905
|
4,761,905
|
||||||
November 12, 2015 financing:
|
||||||||
Warrants to institutional investors
|
12,500,000
|
12,500,000
|
||||||
Warrants to placement agent
|
833,333
|
833,333
|
||||||
March 2, 2016 financing:
|
||||||||
Warrants to institutional investors
|
11,718,750
|
-
|
||||||
Warrants to placement agent
|
781,250
|
-
|
||||||
Total:
|
38,991,904
|
26,491,904
|
June 30, 2016
|
December 31, 2015
|
|||||||
Trading market prices
|
$
|
0.25
|
$
|
0.36
|
||||
Estimated future volatility
|
105
|
%
|
105
|
%
|
||||
Dividend
|
-
|
-
|
||||||
Estimated future risk-free rate
|
0.20-1.36
|
%
|
0.82-2.38
|
%
|
||||
Equivalent volatility
|
43-62
|
%
|
44-65
|
%
|
||||
Equivalent risk-free rate
|
0.01-0.63
|
%
|
0.22-1.11
|
%
|
For the Three Months Ended
June 30,
|
For the Six Months Ended
June 30,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
March 31, 2011 financing:
|
||||||||||||||||
Warrants to institutional investors
|
33
|
202,963
|
30
|
305,040
|
||||||||||||
December 4, 2012 financing:
|
||||||||||||||||
Warrants to institutional investors
|
5,911
|
32,568
|
7,278
|
29,671
|
||||||||||||
Warrants to placement agent
|
529
|
5,434
|
1,206
|
5,577
|
||||||||||||
July 26, 2013 financing:
|
||||||||||||||||
Warrants to institutional investors
|
63,246
|
289,146
|
93,900
|
264,360
|
||||||||||||
Warrants to placement agent
|
64
|
15,209
|
384
|
19,554
|
||||||||||||
October 16, 2013 financing:
|
||||||||||||||||
Warrants to institutional investors
|
103,166
|
323,698
|
129,607
|
305,938
|
||||||||||||
Warrants to placement agent
|
145
|
48,918
|
970
|
64,097
|
||||||||||||
January 21, 2014 financing:
|
||||||||||||||||
Warrants to institutional investors
|
92,428
|
640,824
|
117,714
|
679,938
|
||||||||||||
November 12, 2015 financing:
|
||||||||||||||||
Warrants to institutional investors
|
875,913
|
-
|
1,204,626
|
-
|
||||||||||||
Warrants to placement agent
|
58,276
|
-
|
80,160
|
-
|
||||||||||||
March 2, 2016 financing:
|
||||||||||||||||
Warrants to institutional investors
|
860,121
|
-
|
1,252,266
|
-
|
||||||||||||
Warrants to placement agent
|
58,258
|
-
|
85,904
|
-
|
||||||||||||
Total:
|
$
|
2,118,090
|
$
|
1,558,760
|
$
|
2,974,045
|
$
|
1,674,175
|
13. | Income Taxes |
June 30,
2016
|
December 31,
2015
|
|||||||
Net Operating Loss Carryforwards
|
$
|
41,769,000
|
$
|
38,592,000
|
||||
Stock Compensation Expense
|
1,905,000
|
1,891,000
|
||||||
Book tax differences on assets and liabilities
|
309,000
|
380,000
|
||||||
Valuation Allowance
|
(43,983,000
|
)
|
(40,863,000
|
)
|
||||
Net Deferred Tax Assets
|
$
|
-
|
$
|
-
|
14. | Commitments and Contingencies |
a)
|
The Company has contracted with various vendors for research and development services, the terms which require payments over the terms of the agreements, usually ranging from two to 36 months. The costs to be incurred are estimated and are subject to revision. As of June 30, 2016, the total estimated cost to complete these agreements was approximately $6,440,000.
All of these agreements may be terminated by either party upon appropriate notice as stipulated in the respective agreements.
|
b)
|
On June 22, 2009, the Company entered into a License Agreement with Korea Research Institute of Chemical Technology (“KRICT”) to acquire the rights to all intellectual property related to quinoxaline-piperazine derivatives that were synthesized under a Joint Research Agreement. The initial license fee was $100,000, all of which was paid as of December 31, 2009. The agreement with KRICT calls for a one-time milestone payment of $1,000,000 within 30 days after the first achievement of marketing approval of the first commercial product arising out of or in connection with the use of KRICT’s intellectual properties. As of June 30, 2016, the milestone has not occurred.
|
c)
|
Office Space Lease
|
For the remaining six months ending December 31:
|
2016
|
134,264
|
|||
For the year ending December 31:
|
2017
|
255,731
|
|||
|
2018 |
233,923
|
|||
2019
|
152,955
|
||||
2020
|
34,468
|
||||
Total
|
$
|
811,341
|
d)
|
The Company has established a 401(k) plan for its employees. The Company has elected to match 100% of the first 3% of an employee’s compensation plus 50% of an additional 2% of the employee’s deferral. Expense related to this matching contribution aggregated to $31,5
87
and $
34,799
for the three months ended June 30, 2016 and 2015, respectively, and $63,089 and $64,158 for the six months ended June 30, 2016 and 2015.
|
e)
|
In July 2013, the Company entered into an exclusive license agreement with the University of Maryland, Baltimore for a novel drug delivery platform, Nano-Polymer Drug Conjugate Systems. RX-21101 is the Company’s first drug candidate utilizing this platform. The agreement requires the Company to make payments to the University of Maryland if RX-21101 or any products from the licensed delivery platform achieve development milestones. As of June 30, 2016, no development milestones have occurred.
|
f)
|
In October 2013, the Company signed an exclusive license agreement with the Ohio State Innovation Foundation, for a novel oligonucleotide drug delivery platform, Lipid-Coated Albumin Nanoparticle. The agreement requires the Company to make payments to the Ohio State Innovation Foundation or any products from the licensed delivery platform achieve development milestones. As of June 30, 2016, no development milestones have occurred.
|
15. | Fair Value Measurements |
Level 1 Inputs
|
—
|
Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible by the Company;
|
||
Level 2 Inputs
|
—
|
Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and
|
||
Level 3 Inputs
|
—
|
Unobservable inputs for the asset or liability including significant assumptions of the Company and other market participants.
|
Fair Value Measurements at June 30, 2016
|
||||||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets:
|
||||||||||||||||
Certificates of Deposit
|
$
|
5,522,179
|
$
|
-
|
$
|
5,522,179
|
$
|
-
|
||||||||
Commercial Paper
|
2,992,930
|
-
|
2,992,930
|
-
|
||||||||||||
Corporate Bonds
|
3,004,790
|
-
|
3,004,790
|
-
|
||||||||||||
Total Assets:
|
$
|
11,519,899
|
$
|
-
|
$
|
11,519,899
|
$
|
-
|
||||||||
Liabilities:
|
||||||||||||||||
Warrant Liabilities
|
$
|
2,340,978
|
-
|
-
|
$
|
2,340,978
|
Fair Value Measurements at December 31, 2015
|
||||||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets:
|
||||||||||||||||
Certificates of Deposit
|
$
|
6,234,996
|
$
|
-
|
$
|
6,234,996
|
$
|
-
|
||||||||
Commercial Paper
|
2,977,570
|
-
|
2,977,570
|
-
|
||||||||||||
Corporate Bonds
|
4,027,520
|
-
|
4,027,520
|
-
|
||||||||||||
Total Assets:
|
$
|
13,240,086
|
$
|
-
|
$
|
13,240,086
|
$
|
-
|
||||||||
Liabilities:
|
||||||||||||||||
Warrant Liabilities
|
$
|
2,739,163
|
-
|
-
|
$
|
2,739,163
|
Warrant Liabilities
|
||||
Balance at January 1, 2016
|
$
|
2,739,163
|
||
Additions
|
2,575,860
|
|||
Unrealized gains, net
|
(2,974,045
|
)
|
||
Transfers out of level 3
|
-
|
|||
Balance at June 30, 2016
|
$
|
2,340,978
|
Warrant Liabilities
|
||||
Balance at January 1, 2015
|
$
|
3,768,351
|
||
Additions
|
-
|
|||
Unrealized gains, net
|
(1,674,175
|
)
|
||
Transfers out of level 3
|
-
|
|||
Balance at June 30, 2015
|
$
|
2,094,176
|
· | our understandings and beliefs regarding the role of certain biological mechanisms and processes in cancer; |
· | our drug candidates being in early stages of development, including in pre-clinical development; |
· | our ability to initially develop drug candidates for orphan indications to reduce the time-to-market and take advantage of certain incentives provided by the U.S. Food and Drug Administration; |
· | our ability to transition from our initial focus on developing drug candidates for orphan indications to candidates for more highly prevalent indications; |
· | our ability to successfully and timely complete clinical trials for our drug candidates in clinical development; |
· | uncertainties related to the timing, results and analyses related to our drug candidates in pre-clinical development; |
· | our ability to obtain the necessary U.S. and international regulatory approvals for our drug candidates; |
· | our reliance on third-party contract research organizations and other investigators and collaborators for certain research and development services; |
· | our ability to maintain or engage third-party manufacturers to manufacture, supply, store and distribute supplies of our drug candidates for our clinical trials; |
· | our ability to form strategic alliances and partnerships with pharmaceutical companies and other partners for sales and marketing of certain of our product candidates; |
· | demand for and market acceptance of our drug candidates; |
· | the scope and validity of our intellectual property protection for our drug candidates and our ability to develop our candidates without infringing the intellectual property rights of others; |
· | our lack of profitability and the need for additional capital to operate our business; and |
· | other risks and uncertainties, including those set forth herein and in our Annual Report on Form 10-K under the caption “Risk Factors” and those detailed from time to time in our filings with the Securities and Exchange Commission. |
· | Archexin is a potential best-in-class, potent inhibitor of the protein kinase Akt-1, which we believe plays a critical role in cancer cell proliferation, survival, angiogenesis, metastasis and drug resistance. Archexin has received “orphan drug” designation from the U.S. Food and Drug Administration (the “FDA”) for renal cell carcinoma (“RCC”), glioblastoma, ovarian cancer, stomach cancer and pancreatic cancer. Orphan drug designation provides tax incentives for clinical research and a waiver from user fees under certain circumstances. In addition, an orphan drug receives seven years of exclusivity after approval, during which the FDA generally cannot approve another product with the same active moiety for the same indication. We have completed a pilot Phase IIa clinical trial of Archexin for the treatment of pancreatic cancer. We are currently conducting a Phase IIa proof-of-concept clinical trial of Archexin in patients with metastatic renal cell carcinoma to evaluate its safety and efficacy in combination with everolimus. |
· | RX-3117 is a small molecule nucleoside compound that we believe has therapeutic potential in a broad range of cancers, including pancreatic, bladder, colon, and lung cancer. We completed an exploratory Phase I clinical study of RX-3117 that showed a level of oral bioavailability of RX-3117 in humans with no adverse effects reported. We recently identified the maximum tolerated dose (“MTD”) of RX-3117, which we are now evaluating in a Phase Ib/IIa proof-of-concept clinical trial in patients with relapsed and refractory pancreatic cancer and advanced bladder cancer. |
· | Supinoxin , or RX-5902, is a potential first-in-class small molecule inhibitor of phosphorylated-p68, a protein that we believe plays a key role in cancer cell growth, progression and metastasis. We are currently conducting a Phase I clinical trial of Supinoxin to evaluate its safety and efficacy in patients with solid tumors. |
For the Three Months Ended
June 30,
|
For the Six Months Ended
June 30,
|
|||||||||||||||
2016
|
2015
|
2016
|
2015
|
|||||||||||||
Clinical Candidates:
|
||||||||||||||||
Archexin
|
$
|
226,000
|
$
|
579,200
|
$
|
1,083,600
|
$
|
1,081,500
|
||||||||
RX-3117
|
487,500
|
1,035,200
|
1,434,700
|
2,204,900
|
||||||||||||
Supinoxin
|
593,300
|
691,300
|
1,329,400
|
1,078,000
|
||||||||||||
Preclinical, Personnel and Overhead
|
930,233
|
929,388
|
1,857,907
|
1,763,696
|
||||||||||||
Total Research and Development Expenses
|
$
|
2,237,033
|
$
|
3,235,088
|
$
|
5,705,607
|
$
|
6,128,096
|
· | the progress of our product development activities; |
· | the number and scope of our product development programs; |
· | the progress of our pre-clinical and clinical trial activities; |
· | the progress of the development efforts of parties with whom we have entered into collaboration agreements; |
· | our ability to maintain current collaboration programs and to establish new collaboration arrangements; |
· | the costs involved in prosecuting and enforcing patent claims and other intellectual property rights; and |
· | the costs and timing of regulatory approvals. |
PART II. | Other Information |
REXAHN PHARMACEUTICALS, INC.
|
||
(Registrant)
|
||
By:
|
/s/ Peter D. Suzdak
|
|
Date: August 5, 2016
|
Peter D. Suzdak
|
|
Chief Executive Officer
|
||
(principal executive officer)
|
||
By:
|
/s/ Tae Heum Jeong
|
|
Date: August 5, 2016
|
Tae Heum Jeong
|
|
Chief Financial Officer and Secretary
|
||
(principal financial and accounting officer)
|
Exhibit No.
|
Description
|
|
Fourth Amendment to Lease Agreement, dated April 4, 2016, by and between Rexahn Pharmaceuticals, Inc. and SG Plaza Holdings, LLC.
|
||
Bonus Letter Agreement, dated August 2, 2016, by and between Rexahn Pharmaceuticals, Inc. and Ely Benaim, M.D.
|
||
Certification of Chief Executive Officer pursuant to Rules 13a-14(a) / 15d-14(a)
|
||
Certification of Chief Financial Officer pursuant to Rules 13a-14(a) / 15d-14(a)
|
||
Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
||
101
|
The following materials from Rexahn Pharmaceuticals, Inc.’s Quarterly Report on Form 10-Q, formatted in Extensible Business Reporting Language (“XBRL”): (i) Condensed Balance Sheet; (ii) Condensed Statement of Operations; (iii) Condensed Statement of Comprehensive Loss; (iv) Condensed Statement of Cash Flows; and (v) Notes to the Financial Statements.
|
Client: | |||||
WITNESS/ATTEST:
|
REXAHN PHARMACEUTICALS, INC. , a Delaware corporation | ||||
Mark Lee
|
By : | /s/ |
Peter Suzdak
|
[SEAL] | |
Name: Peter Suzdak | |||||
Title: CEO |
Landlord: | |||||
WITNESS/ATTEST:
|
SG PLAZA HOLDINGS, LLC , a Delaware limited liability company | ||||
Natalia Maselli
|
By : | /s/ |
Andrew Nathan
|
||
Andrew Nathan, CEO |
RE: | BONUS PAYMENT |
Date of termination of employment other than by you for Good Reason or by the Company for Cause
|
Repayment of Net Amount
(by percentage)
|
On or prior to August 2, 2017
|
100%
|
On or prior to August 2, 2018
|
50%
|
After August 2, 2018
|
0%
|
REXAHN PHARMACEUTICALS, INC.
|
||
By:
|
/s/ Peter Suzdak
|
|
Name:
|
Peter Suzdak, Ph.D.
|
|
Title:
|
Chief Executive Officer
|
AGREED AND ACCEPTED AS OF THIS 2
nd
DAY OF AUGUST 2016
|
||
/s/ Ely Benaim
|
||
Ely Benaim, M.D.
|
1. | I have reviewed this Quarterly Report on Form 10-Q of Rexahn Pharmaceuticals, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: August 5, 2016
|
|
/s/ Peter D. Suzdak
|
|
Peter D. Suzdak
|
|
Chief Executive Officer
|
1. | I have reviewed this Quarterly Report on Form 10-Q of Rexahn Pharmaceuticals, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: August 5, 2016
|
By:
|
/s/ Peter D. Suzdak
|
|
Peter D. Suzdak,
|
|||
Chief Executive Officer
|
*
|
This Certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. This Certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Dated: August 5, 2016
|
By:
|
/s/ Tae Heum Jeong
|
|
Tae Heum Jeong,
|
|||
Chief Financial Officer
|
*
|
This Certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. This Certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.
|