What changed in this filing

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Item 1. Financial Statements

2023-08-09 compared with 2023-05-11 · 89 added, 73 removed, 373 unchanged (30% of the section changed)

2 unchanged sentences

Condensed Interim Consolidated Balance Sheets

June 30, 2023

September 30, 2022

35 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022

Research and development

8 unchanged sentences

Interest income

Foreign exchange gain (loss)

Foreign exchange loss

Loss before income taxes

19 unchanged sentences

Condensed Interim Consolidated Statements of Cash Flows

Six Months Ended

Nine Months Ended

June 30, 2023

June 30, 2022

Cash flows from operating activities:

33 unchanged sentences

Accumulated Deficit

Three Months Ended March 31, 2023

Balance - December 31, 2022

Total Shareholders' Equity

Three Months Ended June 30, 2023

Balance - March 31, 2023

$ ( 230,026 )

$ ( 48,713,719 )

Issuance of common shares upon exercise of warrants

Issuance of common shares and warrants in equity offering

Issuance costs

3 unchanged sentences

( 1,945,067 )

Balance - March 31, 2023

$ ( 230,026 )

Balance - June 30, 2023

$ ( 190,187 )

Three Months Ended March 31, 2022

Balance - December 31, 2021

$ ( 50,698,625 )

Three Months Ended June 3, 2022

Balance - March 31, 2022

$ ( 160,347 )

Issuance of common shares and warrants in equity offering

Issuance costs including fair value of placement agent warrants

$ ( 35,443,622 )

3 unchanged sentences

( 5,752,461 )

Balance - March 31, 2022

Balance - June 30, 2022

$ ( 125,788 )

$ ( 41,230,642 )

Six Months Ended March 31, 2023

Nine Months Ended June 30, 2023

Balance - September 30, 2022

8 unchanged sentences

( 6,630,657 )

Balance - March 31, 2023

Balance - June 30, 2023

$ ( 190,187 )

$ ( 50,698,625 )

Six Months Ended March 31, 2022

Nine Months Ended June 30, 2022

Balance - September 30, 2021

8 unchanged sentences

( 14,655,539 )

Balance - March 31, 2022

Balance - June 30, 2022

$ ( 125,788 )

18 unchanged sentences

All adjustments (consisting of normal recurring adjustments and accruals) considered necessary for a fair presentation of the results of operations for the periods presented have been included in the interim periods.

Operating results for the three and six months ended March 31, 2023 are not necessarily indicative of the results that may be expected for other interim periods or the fiscal year ending September 30, 2023.

Operating results for the three and nine months ended June 30, 2023 are not necessarily indicative of the results that may be expected for other interim periods or the fiscal year ending September 30, 2023.

Use of estimates

5 unchanged sentences

intangible assets;

operating lease right-of-use assets;

right-of-use assets;

deferred income taxes;

19 unchanged sentences

Intangible assets, net consisted of the following:

June 30, 2023

September 30, 2022

2 unchanged sentences

Total intangible assets, net

Amortization expense amounted to $ 0.03 million for each of the three months ended March 31, 2023 and 2022 and $ 0.05 million for each of the six months ended March 31, 2023 and 2022 .

Amortization expense amounted to $ 0.03 million for each of the three months ended June 30, 2023 and 2022 and $ 0.08 million for each of the nine months ended June 30, 2023 and 2022.

Total estimated future amortization of intangible assets for each fiscal year is as follows:

9 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

June 30, 2023

June 30, 2022

June 30, 2023

June 30, 2022

Right-of-use lease cost, included in general and administrative on the Statements of Operations

Lease terms and discount rates were as follows:

March 31, 2023

June 30, 2023

September 30, 2022

1 unchanged sentence

Estimated incremental borrowing rate:

The future minimum lease payments under right-of-use leases at March 31, 2023 were as follows:

The future minimum lease payments under right-of-use leases at June 30, 2023 were as follows:

September 30, 2023

7 unchanged sentences

Cash flow information was as follows:

Six Months Ended

Nine Months Ended

June 30, 2023

June 30, 2022

Cash paid for amounts included in the measurement of right-of-use lease liabilities, included in accounts payable and accrued liabilities on the Statements of Cash Flow.

1 unchanged sentence

The Company has commitments for contracted research organizations who perform clinical trials for the Company’s ongoing clinical studies and other service providers.

Approximate aggregate future contractual payments at March 31, 2023 are as follows:

Approximate aggregate future contractual payments at June 30, 2023 are as follows:

September 30, 2023

4 unchanged sentences

License and royalty commitments

In April 2020, through its Ontario subsidiary, the Company entered into a license agreement with a third party to obtain exclusive world-wide rights to certain know-how, patents and data relating to certain monoclonal antibodies (the Constructs), including sublicensing rights.

An intangible asset for the acquired license has been recognized.

2 unchanged sentences

The Company also has a commitment to pay royalties based on any net sales of products containing the Constructs in the countries where the Company directly commercializes the products containing the Constructs and a percentage of any sublicensing revenue received by the Company and its affiliates in the countries where it does not directly commercialize the products containing the Constructs.

No milestone, royalty or sublicensing payments were made to the third party during the three and six months ended March 31, 2023 and 2022.

No milestone, royalty or sublicensing payments were made to the third party during the three and nine months ended June 30, 2023 and 2022.

In connection with this license agreement and pursuant to a purchase agreement entered into in April 2020, the Company acquired drug substance of one of the Constructs for an aggregate purchase price of $5.0 million, payable in two installments.

The Company recorded expense of $2.5 million for the second installment during the three and nine months ended June 30, 2022.

No expense was recorded during the three and nine months ended June 30, 2023.

In 2016, through its Ontario subsidiary, the Company entered into a license agreement with a third party to obtain exclusive rights to certain know- how, patents and data relating to a pharmaceutical product.

4 unchanged sentences

The Company also has a commitment to pay the third party a royalty based on net sales of the product in countries where the Company, or an affiliate, directly commercializes the product and a percentage of sublicensing revenue received by the Company and its affiliates in the countries where it does not directly commercialize the product.

Milestone payments totaling $ 0.06 million and $ 0.12 million were made to the third party during the three and six months ended March 31, 2023, respectively.

No milestones were met during the three and six months ended March 31, 2022.

No royalty or sublicensing payments were made to the third party during the three and six months ended March 31, 2023 and 2022.

Milestone payments totaling $ 0.04 million and $ 0.16 million were made to the third party during the three and nine months ended June 30, 2023, respectively.

No milestones were met during the three and nine months ended June 30, 2022.

No royalty or sublicensing payments were made to the third party during the three and nine months ended June 30, 2023 and 2022.

In March 2021, through its Ontario subsidiary, the Company entered into a license agreement with the inventor of the same pharmaceutical product to acquire global rights for all fields of use beyond those named under the 2016 license agreement.

Milestone payments of $ 0.03 million were made under the 2021 agreement during the six months ended March 31, 2022.

No milestones were met during the three and six months ended March 31, 2023 or the three months ended March 31, 2022.

Milestone payments of $ 0.03 million were made under the 2021 agreement during the nine months ended June 30, 2022.

No milestones were met during the three and nine months ended June 30, 2023 or the three months ended June 30, 2022.

The Company is committed to remaining milestone payments of up to an aggregate amount of $ 68.9 million, primarily relating to future potential commercial approval and sales milestones.

4 unchanged sentences

The Company has no obligation to sell any of the common shares and may at any time suspend sales or terminate the equity distribution agreement in accordance with its terms.

During the three months ended March 31, 2023, there were no sales under the equity distribution agreement.

From November 22, 2021 until terminated March 21, 2022, the Company had an equity distribution agreement for an at-the-market equity offering program with another sales agent.

During the six months ended March 31, 2022, the Company sold a total of 626,884 common shares pursuant to the agreement for net proceeds of $2.62 million.

During the three months ended June 30, 2023, the Company sold a total of 808,107 common shares pursuant to the agreement for net proceeds of $ 0.69 million after deducting commissions and costs.

From November 22, 2021 until terminated on March 21, 2022, the Company had an equity distribution agreement for an at-the-market equity offering program with another sales agent.

During the nine months ended June 30, 2022, the Company sold a total of 626,884 common shares pursuant to the agreement for net proceeds of $ 2.62 million.

Equity offerings

27 unchanged sentences

Weighted Average Exercise Price

Six Months Ended March 31, 2023

Nine Months Ended June 30, 2023

Balance - September 30, 2022

Balance - March 31, 2023

Six Months Ended March 31, 2022

Balance - June 30, 2023

Nine Months Ended June 30, 2022

Balance - September 30, 2021

Balance - March 31, 2022

The weighted average contractual life remaining on the outstanding warrants at March 31, 2023 is 37 months.

The following table summarizes information about the warrants outstanding at March 31, 2023:

Balance - June 30, 2022

The weighted average contractual life remaining on the outstanding warrants at June 30, 2023 is 34 months.

The following table summarizes information about the warrants outstanding at June 30, 2023:

Number of Warrants (#)

4 unchanged sentences

September 2027

The fair value of warrants granted during the six months ended March 31, 2023 was estimated using the Black-Scholes option valuation model using the following assumptions:

Six Months Ended March 31, 2023

Six Months Ended March 31, 2022

Class A Warrants

Class B Warrants

The fair value of warrants granted during the nine months ended June 30, 2023 was estimated using the Black-Scholes option valuation model using the following assumptions:

Nine Months Ended June 30, 2023

Nine Months Ended June 30, 2022

Class A Warrants

Class B Warrants

Common Warrants

Placement Agent Warrants

Risk free interest rate

5 unchanged sentences

Number of Pre-funded Warrant Shares (#)

Six Months Ended March 31, 2022

Nine Months Ended June 30, 2022

Balance - September 30, 2021

Balance - March 31, 2022

There were no pre-funded warrants during the six months ended March 31, 2023.

Balance - June 30, 2022

There were no pre-funded warrants during the nine months ended June 30, 2023.

Share Options

1 unchanged sentence

Options, restricted shares and restricted share units are eligible for grant under the 2019 Plan.

At March 31, 2023, the total number of shares available for issuance is 2,625,951 including shares available for the exercise of outstanding options under the 2019 Plan.

The remaining number of options available for grant at March 31, 2023 is 89,540 .

At June 30, 2023, the total number of shares available for issuance is 1,557,766 including shares available for the exercise of outstanding options under the 2019 Plan.

The remaining number of options available for grant at June 30, 2023 is 1,557,766 .

The Company’s 2019 Plan allows options to be granted to directors, officers, employees and certain external consultants and advisers.

7 unchanged sentences

Weighted Average Grant Date Fair Value

Six Months Ended March 31, 2023

Nine Months Ended June 30, 2023

Balance - September 30, 2022

Balance - March 31, 2023

Six Months Ended March 31, 2022

Balance - June 30, 2023

Nine Months Ended June 30, 2022

Balance - September 30, 2021

Balance - March 31, 2022

During the six months ended March 31, 2023, the independent members of the Board of Directors granted 332,950 employee and new employee options pursuant to the 2019 Plan.

During the six months ended March 31, 2022, the independent members of the Board of Directors granted 415,083 employee options and 85,000 director options.

Balance - June 30, 2022

During the nine months ended June 30, 2023, the independent members of the Board of Directors granted 332,950 employee and new employee options pursuant to the 2019 Plan.

During the nine months ended June 30, 2022, the independent members of the Board of Directors granted 415,083 employee options and 85,000 director options.

The options have a term of 10 years and an exercise price equal to the Nasdaq closing price on the grant date.

The weighted average contractual life remaining on the outstanding options at March 31, 2023 is 94 months.

The following table summarizes information about the options under the 2019 Plan outstanding and exercisable at March 31, 2023:

The weighted average contractual life remaining on the outstanding options at June 30, 2023 is 90 months.

The following table summarizes information about the options under the 2019 Plan outstanding and exercisable at June 30, 2023:

Number of Options (#)

Exercisable at

March 31, 2023 (#)

June 30, 2023 (#)

Range of Exercise Prices

10 unchanged sentences

Dec 2032 - Feb 2033

The fair value of options granted during the six months ended March 31, 2023 and 2022 was estimated using the Black-Scholes option valuation model using the following assumptions:

Six Months Ended

March 31, 2023

March 31, 2022

The fair value of options granted during the nine months ended June 30, 2023 and 2022 was estimated using the Black-Scholes option valuation model using the following assumptions:

Nine Months Ended

June 30, 2023

June 30, 2022

Risk free interest rate

6 unchanged sentences

Expected dividend yield

The Company recorded $ 0.29 million and $ 0.63 million of share-based compensation expenses for the three months ended March 31, 2023 and 2022, respectively and $ 0.62 million and $ 1.24 million for the six months ended March 31, 2023 and 2022, respectively.

As of March 31, 2023, the Company had $ 0.77 million of unrecognized share-based compensation expense, which is expected to be recognized over a period of 35 months.

The Company recorded $ 0.11 million and $ 0.57 million of share-based compensation expenses for the three months ended June 30, 2023 and 2022, respectively and $ 0.73 million and $ 1.80 million for the nine months ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, the Company had $ 0.46 million of unrecognized share-based compensation expense, which is expected to be recognized over a period of 31 months.

Reimbursement Grant Income and Receivable

Reimbursement grant income for the Company’s federal grant with the Canadian government’s Strategic Innovation Fund (SIF) is recorded based on the claim period of eligible costs.

At March 31, 2023, the grant program is complete and all grant reimbursements have been received.

At June 30, 2023, the grant program is complete and all grant reimbursements have been received.

Financial Instruments

22 unchanged sentences

The Company and its subsidiary have balances in Canadian dollars that give rise to exposure to foreign exchange (FX) risk relating to the impact of translating certain non-U.S.

The Company and its Canadian subsidiary have balances in Canadian dollars that give rise to exposure to foreign exchange (FX) risk relating to the impact of translating certain non-U.S.

dollar balance sheet accounts as these statements are presented in U.S.

3 unchanged sentences

The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks.

At March 31, 2023, the Company and its Canadian subsidiary had assets denominated in Canadian dollars of approximately C$5.2 million and the U.S.

At June 30, 2023, the Company and its Canadian subsidiary had assets denominated in Canadian dollars of approximately C$ 3.3 million and the U.S.

dollar exchange rate at this date was equal to 1.3250 Canadian dollars.

Based on the exposure at March 31, 2023, a 10% annual change in the Canadian/U.S.

Based on the exposure at June 30, 2023, a 10% annual change in the Canadian/U.S.

exchange rate would impact the Company’s loss and other comprehensive loss by approximately $0.3 million .

3 unchanged sentences

Loss per Share

The Company had securities outstanding which could potentially dilute basic EPS in the future but were excluded from the computation of diluted loss per share in the periods presented, as their effect would have been anti-dilutive.

The Company had securities outstanding which could potentially dilute basic earnings per share in the future but were excluded from the computation of diluted loss per share in the periods presented, as their effect would have been anti-dilutive.

Related Party Transactions

During each of three and six months ended March 31, 2023 and 2022, the Company paid cash of $ 0.02 million and $ 0.04 million, respectively, for a right of use lease from a company controlled by the Company’s CEO.

During each of three and nine months ended June 30, 2023 and 2022, the Company paid cash of $ 0.02 million and $ 0.06 million, respectively, for a right of use lease from a company controlled by the Company’s CEO.

These transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by both parties.

1 unchanged sentence

Subsequent Events

Subsequent to March 31, 2023, equity sales under the Company’s “at the market” offering program have resulted in the issuance of 562,052 common shares and receipt of net cash proceeds of $ 0.60 million after deducting sales agent commissions.

Subsequent to June 30, 2023, equity sales under the Company’s at-the-market offering program have resulted in the issuance of 226,882 common shares and receipt of net cash proceeds of $ 0.19 million after deducting sales agent commissions.

Subsequent to the quarter end, the Company granted 497,000 share options to employees and directors and 326,200 restricted shares units to certain employees in lieu of cash-based incentive compensation and to one employee for payment of past consulting services.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements