UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
 Form 6-K
 
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
 
For May 2021

Commission File No. 001-36848
 
Check-Cap Ltd.
 
 
Check-Cap Building
Abba Hushi Avenue
P.O. Box 1271
Isfiya, 30090
Mount Carmel, Israel
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES.)
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
 
Form 20-F ☒     Form 40-F ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
 
The financial statements included in the press release attached as Exhibit 99.1 to this Form 6-K are being incorporated by reference into the Post-Effective Amendment No. 1 to the Form S-8 Registration Statement File No. 333-203384, Form S-8 Registration Statement File No. 333-226490, and into the Form F-3 Registration Statements File Nos. 333-211065, 333-225789 and 333-248200.
 
Other Information
 
On May 12, 2021, Check-Cap Ltd. provided certain corporate updates and announced its financial results for the first quarter of 2021. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. 
 
Exhibit
 
 
 
 
 
Exhibit No. 
 
Description
 
 
 
 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
Check-Cap Ltd.
 
 
 
 
By:
/s/ Alex Ovadia
 
 
Name: Alex Ovadia
 Date: May 12, 2021
 
Title: Chief Executive Officer

Exhibit 99.1


Check-Cap Reports First Quarter 2021 Financial Results and Corporate Update
 
ISFIYA, Israel, May 12, 2021 -- Check-Cap Ltd. (the "Company" or "Check-Cap") (NASDAQ: CHEK), (NASDAQ: CHEKZ), a clinical stage medical diagnostics company advancing the development of C-Scan®, the first and only patient-friendly, preparation-free screening test, to detect polyps before they may transform into colorectal cancer(CRC), today announced financial results for the first quarter ended March 31, 2021 and provided a corporate update.
 
Q1 2021 and Recent Highlights:
 

•
The U.S. Food and Drug Administration (FDA) has approved the Company’s Investigational Device Exemption (IDE) application permitting Check-Cap to begin a pivotal study of C-Scan in the U.S.
 

•
The FDA has granted the Company Breakthrough Device Designation for C-Scan.
 

•
The Company continues to scale up manufacturing to support upcoming clinical trials, primarily the Company’s U.S. pivotal study.
 

•
Due to technical issues associated with a single source supplier, the Company has recently experienced some manufacturing delays, but continues to expand its entire production process to meet its target manufacturing capacity. The Company expects a delay in its clinical trials, including the initiation of the U.S. pivotal trial, which is now projected to begin by the end of the first quarter of 2022.
 

•
Strengthened balance sheet during the first quarter of 2021 through a total of $19.2 million proceeds from warrant exercises. Cash and cash equivalents, restricted cash and short-term bank deposits as of March 31, 2021 were $34.0 million.
 
“We met a crucial milestone this quarter with the FDA approval of the IDE to begin the pivotal trial of C-Scan in the U.S.,” said Alex Ovadia, chief executive officer of Check-Cap. “While we anticipate a slight delay in our clinical trials, including the U.S. pivotal trial initiation, now projected for March 2022, we are laser-focused on advancing manufacturing activities to ensure a successful trial launch. We look forward to continuing to advance C-Scan as a colorectal cancer screening patient-friendly solution that has potential to enable early intervention and cancer prevention.”
 
Financial Results for the First Quarter Ended March 31, 2021
 
Research and development expenses were $2.4 million for the three months ended March 31, 2021, compared to $2.5 million for the same period in 2020.  The decrease is primarily due to a $0.3 million grant received from the Israel Innovation Authority, which amount is reduced from research and development expenses, and $0.2 million decrease in other expenses and clinical-related expenses, offset in part by a $0.2 million increase in material and subcontractors’ expenses and $0.2 million increase in salary and related expense.
 
General and administrative expenses were $1.2 million for the three months ended March 31, 2021, compared to $1.0 million for the same period in 2020. The increase is primarily due to a $0.2 million increase in professional services and other expenses.
 
Operating loss was $3.6 million for the three months ended March 31, 2021, compared to $3.4 million for the same period in 2020.
 
Finance expense was $9,000 for the three months ended March 31, 2021, compared to $12,000 for the same period in 2020.
 
Net loss was $3.6 million for the three months ended March 31, 2021, compared to $3.4 million for the same period in 2020.
 
Cash and cash equivalents, restricted cash and short-term bank deposits as of March 31, 2021 were $34.0 million as compared to $18.1 million as of December 31, 2020. During the first quarter of 2021, certain warrant holders exercised warrants to purchase an aggregate 24,204,682 ordinary shares, which had been issued in 2020, at exercise prices ranging from $0.75-$0.80, which generated total gross proceeds of approximately $19.2 million to the Company.
 
The number of outstanding ordinary shares as of March 31, 2021 was 70,468,260. As of May 10, 2021, the number of our outstanding ordinary shares was 70,472,316.
 
About Check-Cap
 
Check-Cap is a clinical stage medical diagnostics company aiming to redefine colorectal cancer (CRC) screening through the introduction of C-Scan®, the first and only patient-friendly preparation-free screening test to detect polyps before they may transform into colorectal cancer to enable early intervention and cancer prevention. The Company’s disruptive capsule-based screening technology aims to significantly increase screening adherence worldwide and help millions of people to stay healthy through preventive CRC screening. C-Scan uses an ultra-low dose X-ray capsule, an integrated positioning, control and recording system, as well as proprietary software to generate a 3D map of the inner lining of the colon as it travels naturally along the gastrointestinal tract. C-Scan is non-invasive and requires no sedation. Unlike other capsule technologies, it requires no bowel preparation, allowing the patients to continue their daily routine with no interruption. C-Scan is not intended to replace colonoscopy. A positive C-Scan result should be followed by colonoscopy.
 
Legal Notice Regarding Forward-Looking Statements
 
This press release contains "forward-looking statements." Words such as "may," "should," "could," "would," "predicts," "potential," "continue," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and similar expressions, as well as statements in future tense, often signify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information that the Company has when those statements are made or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. For a discussion of these and other risks that could cause such differences and that may affect the realization of forward-looking statements, please refer to the "Forward-looking Statements" and "Risk Factors" in the Company's Annual Report on Form 20-F for the year ended December 31, 2020 and other filings with the Securities and Exchange Commission (SEC). Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.
 
Investor Contacts
 
Irina Koffler
LifeSci Advisors, LLC
646.970.4681
ikoffler@lifesciadvisors.com

Meirav Gomeh-Bauer
LifeSci Advisors, LLC
+972(0)-54-476-4979
Meirav@lifesciadvisors.com

 
CHECK CAP LTD.
CONSOLIDATED UNAUDITED BALANCE SHEETS
 (U.S. dollars in thousands except share and per share data)
 
 
 
March 31,
   
December 31,
 
 
 
2 0 2 1
   
2 0 2 0
 
Assets
           
Current assets
           
Cash and cash equivalents
   
15,194
     
7,703
 
Restricted cash
   
350
     
350
 
Short-term bank deposit
   
18,470
     
10,079
 
Prepaid expenses and other current assets
   
440
     
285
 
Total current assets
   
34,454
     
18,417
 
 
               
Non-current assets
               
Property and equipment, net
   
847
     
823
 
Operating lease
   
1,223
     
398
 
Total non-current assets
   
2,070
     
1,221
 
Total assets
   
36,524
     
19,638
 
 
               
Liabilities and shareholders' equity
               
Current liabilities
               
Accounts payable and accruals
               
  Trade
   
1,028
     
862
 
  Other
   
295
     
345
 
Employees and payroll accruals
   
1,718
     
1,510
 
Operating lease liabilities
   
327
     
264
 
Total current liabilities
   
3,368
     
2,981
 
 
               
Non-current liabilities
               
Royalties provision
   
196
     
154
 
Operating lease liabilities
   
856
     
125
 
Total non-current liabilities
   
1,052
     
279
 
 
               
Shareholders' equity
               
Share capital, Ordinary shares, 2.4 NIS par value (360,000,000 authorized shares as of March 31, 2021 and December 31, 2020; 70,468,260 and 46,239,183 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively)
   
49,763
     
31,646
 
Additional paid-in capital
   
76,890
     
75,715
 
Accumulated deficit
   
(94,549
)
   
(90,983
)
Total shareholders' equity
   
32,104
     
6,234
 
 
               
Total liabilities and shareholders' equity
   
36,524
     
19,638
 


CHECK CAP LTD.
CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share and per share data)

   
Three months ended
 
   
March 31,
 
   
2021
   
2020
 
Research and development expenses, net
   
2,406
     
2,462
 
General and administrative expenses
   
1,151
     
957
 
Operating loss
   
3,557
     
3,419
 
                 
Finance loss, net
   
9
     
12
 
Loss before income tax
   
3,566
     
3,431
 
                 
Net loss for the period
   
3,566
     
3,431
 
                 
Comprehensive loss
   
3,566
     
3,431
 
Loss per share:
               
Net loss per ordinary share basic and diluted
   
0.05
     
0.34
 

               
Weighted average number of ordinary shares outstanding - basic and diluted
   
68,071,059
     
9,971,098
 

 
CHECK CAP LTD.
CONSOLIDATED UNAUDITED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(U.S. dollars in thousands, except share and per share data)

   
Number of ordinary shares
   

Amount
   
Additional
paid-in capital
   
Accumulated
deficit
   
Total shareholders’
equity
 
Balance as of January 1, 2021
   
46,239,183
   
$
31,646
   
$
75,715
   
$
(90,983
)
 
$
16,378
 
                                         
Exercise of warrants, net of issuance expenses in an amount of $22
   
24,204,682
     
18,099
     
1,120
     
-
     
19,219
 
                                         
    RSU’s vesting
   
24,395
     
18
     
(18
)
           
-
 
                                         
Share-based compensation
   
-
     
-
     
73
     
-
     
73
 
                                         
Net loss
   
-
     
-
     
-
     
(3,566
)
   
(3,566
)
                                         
Balance as of March 31, 2021
   
70,468,260
   
$
49,763
   
$
76,890
   
$
(94,549
)
 
$
32,104
 

 
 
Number of ordinary shares
   

Amount
   
Additional
paid-in capital
   
Accumulated
deficit
   
Total shareholders’
equity
 
Balance as of January 1, 2020
   
8,272,908
   
$
5,407
   
$
77,964
   
$
(77,137
)
 
$
6,234
 
                                         
Issuance of ordinary shares in private placement, net of issuance expenses in an amount of $30
   
2,720,178
     
1,894
     
2,837
     
-
     
4,731
 
                                         
    RSU’s vesting
   
6,633
     
4
     
(4
)
           
-
 
                                         
Share-based compensation
   
-
     
-
     
123
     
-
     
123
 
                                         
Net loss
   
-
     
-
     
-
     
(3,431
)
   
(3,431
)
                                         
Balance as of March 31, 2020
   
10,999,719
   
$
7,305
   
$
80,920
   
$
(80,568
)
 
$
7,657
 

 
CHECK-CAP LTD.
CONSOLIDATED  UNAUDITED STATEMENTS OF CASH FLOWS
  (U.S. dollars in thousands, except share and per share data)
 
   
Three months ended
 
   
March 31,
 
   
2021
   
2020
 
CASH FLOWS FROM OPERATING ACTIVITIES
           
Net loss
   
(3,566
)
   
(3,431
)
Adjustments required to reconcile net loss to net cash used in operating activities:
               
Depreciation
   
43
     
34
 
Share-based compensation
   
73
     
123
 
Financial income, net
   
(57
)
   
(15
)
Changes in assets and liabilities items:
               
Decrease (increase) in prepaid and other current assets and non-current assets
   
(142
)
   
101
 
Increase (decrease) in trade accounts payable, accruals and other current liabilities
   
85
     
(325
)
Increase in employees and payroll accruals
   
208
     
78
 
Increase in royalties provision
   
42
     
2
 
Net cash used in operating activities
   
(3,314
)
   
(3,433
)
                 
CASH FLOWS FROM INVESTING ACTIVITIES
               
Purchase of property and equipment
   
(33
)
   
(57
)
Investment in short-term bank and other deposits
   
(8,381
)
   
(2,258
)
Net cash provided by (used in) investing activities
   
(8,414
)
   
(2,315
)
                 
CASH FLOWS FROM FINANCING ACTIVITIES
               
Exercise of warrants into ordinary shares, net of issuance expenses
   
19,219
     
-
 
Issuance of ordinary shares in private placement, net of issuance expenses
   
-
     
4,731
 
Net cash provided by financing activities
   
19,219
     
4,731
 
                 
Net increase (decrease) in cash, cash equivalents and restricted cash
   
7,491
     
(1,017
)
Cash, cash equivalents and restricted cash at the beginning of the period
   
8,053
     
8,035
 
Cash, cash equivalents and restricted cash at the end of the period
   
15,544
     
7,018
 
Supplemental disclosure of non-cash flow information:
               
Purchase of property and equipment included in accounts payable and accrued expenses
   
32
     
59
 
Assets acquired under operating leases
   
916
     
-
 
Supplemental disclosure of cash flow information