What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-02-12 compared with 2020-11-12 · 187 added, 120 removed, 566 unchanged (35% of the section changed)

Management’s Discussion and Analysis of Fin ancial Condition and Results of Operations

Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis (“MD&A”) contains “forward-looking statements”, within the meaning of the Private Securities Litigation Reform Act of 1995, which represent our projections, estimates, expectations, or beliefs concerning, among other things, financial items that relate to management’s future plans or objectives or to our future economic and financial performance.

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We are also the parent company to Callco and Exchangeco which are British Columbia, Canada corporations.

Cal lco and Exchangeco were formed to facilitate the Reverse Acquisition.

Callco and Exchangeco were formed to facilitate the Reverse Acquisition.

References to “we”, “us”, and “our”, refer to Kintara and our wholly-owned subsidiaries, Del Mar (BC), Adgero, Callco and Exchangeco.

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Recent Highlights

On October 21, 2020, we announced we had entered into a definitive agreement with the Global Coalition for Adaptive Research (“GCAR”) to include VAL-083 in GCAR’s Glioblastoma Adaptive Global Innovative Learning Environment (“GBM AGILE”) Study, an adaptive clinical study platform for patients with GBM.

We plan to utilize the GBM AGILE study to serve as the basis for VAL-083’s new drug application submission and registration.

On August 21, 2020, we announced we had regained compliance with the minimum bid price requirement for continued listing on The Nasdaq Capital Market.

As a result of our shares having had a closing bid price at, or above, $1.00 per share for a minimum of ten (10) consecutive business days, our stock had regained compliance with the minimum bid price requirement and the matter is now closed.

On January 13, 2021, we announced the initiation of patient recruitment for the VAL-083 study arm of the Global Coalition for Adaptive Research (“GCAR”) registrational Phase 2/3 clinical trial for GBM.

The trial, titled GBM AGILE (Glioblastoma Adaptive Global Innovative Learning Environment) Study, is a revolutionary, patient-centered, adaptive platform trial for registration evaluating multiple therapies for patients with newly-diagnosed and recurrent GBM.

We also announced that VAL-083 is the only therapeutic agent currently being evaluated in all three GBM patient subtypes:

newly-diagnosed methylated MGMT;

newly-diagnosed unmethylated MGMT;

and recurrent.

On November 19, 2020 at the Society of Neuro-Oncology (“SNO”) Annual Meeting we announced positive data updates from our ongoing Phase 2 clinical studies in newly-diagnosed first-line, newly-diagnosed adjuvant, and recurrent GBM.

On October 21, 2020, we announced we had entered into a definitive agreement with GCAR to include VAL-083 in GCAR’s GBM AGILE Study.

We plan to utilize the GBM AGILE Study to serve as the basis for VAL-083’s new drug application (“NDA”) submission and registration.

On August 19, 2020, we completed our merger with Adgero and through three closings of a private placement, the first of which also closed on August 19, 2020, we raised aggregate gross proceeds of approximately $25 million, or net proceeds of approximately $21.6 million.

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Below are our planned, or expected, milestones for the respective time periods noted:

First Patient Enrolled - GCAR GBM AGILE Registration Study

Top Line Results - Phase 2 Newly-Diagnosed GBM Study

Top Line Results - Phase 2 Recurrent GBM Study

Top Line Results - Phase 2 Adjuvant GBM Study

Commence Enrollment – GCAR GBM AGILE Registration Study

American Association for Cancer Research Posters – Data Updates for Phase 2 GBM Studies

Top Line Results – Phase 2 Recurrent/Adjuvant GBM Study

First patient enrolled – CMBC lead-in study

Top Line Results – CMBC lead-in study

Graduation from Stage 1 to Stage 2 - GCAR GBM AGILE Registration Study

Graduation from Stage 1 to Stage 2 in the GCAR GBM AGILE Registration Study

Product Pipeline

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MGMT-unmethylated GBM, currently comprising two ongoing, separate Phase 2 clinical studies for:

GBM patients in two study arms at MD Anderson Cancer Center:

GBM patients in two study arms at MD Anderson Cancer Center (“MDACC”):

as adjuvant therapy immediately following concomitant TMZ treatment with chemoradiation;

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Newly-diagnosed GBM patients at Sun Yat-sen University Cancer Center (“SYSUCC”).

On June 4, 2020, we accepted an invitation from the Global Coalition for Adaptive Research (“GCAR”) to include VAL-083 in GCAR’s Glioblastoma Adaptive Global Innovative Learning Environment (“GBM AGILE”) Study, an adaptive clinical study platform for patients with GBM.

On October 21, 2020, we announced we had entered into a definitive agreement with GCAR.

We plan to utilize the GBM AGILE Study to serve as the basis for VAL-083’s new drug application submission and registration.

GBM AGILE is an international effort to develop potential therapies for newly-diagnosed and recurrent GBM utilizing an FDA approved master protocol with multiple drugs from multiple sponsors tested simultaneously, and over time, against a common control arm with a primary endpoint of overall survival.

We intend to use results from the VAL-083 arm of the GBM AGILE study to file for FDA approval, assuming results support such a filing.

GBM AGILE is a Phase II/Phase III study which employs a cost-efficient, adaptive study design with a Stage 1 learning and adapting phase and a Stage 2 expansion and confirmation phase.

GBM AGILE will consist of up to a maximum 200 patients stratified by three subtypes:

newly-diagnosed methylated, newly-diagnosed unmethylated, and recurrent.

The effort is led by key opinion leaders in the GBM field and has the collective support of an international group of more than 130 clinicians, researchers, biostatisticians, imagers, pathologists, leaders from government and industry, and patient advocates.

On June 4, 2020, we accepted an invitation from GCAR to include VAL-083 in GCAR’s GBM AGILE Study, an adaptive clinical study platform for patients with GBM.

On October 21, 2020, we announced we had entered into a definitive agreement with GCAR and on January 13, 2021, we announced the initiation of patient recruitment for the VAL-083 study arm of the GBM AGILE Study.

We also announced that VAL-083 is the only therapeutic agent currently being evaluated in all three GBM patient subtypes in the GBM AGILE Study:

newly-diagnosed methylated MGMT;

newly-diagnosed unmethylated MGMT;

and recurrent.

We plan to utilize the GBM AGILE Study to serve as the basis for VAL-083’s NDA submission and registration.

GBM AGILE is an international, innovative platform trial designed to more rapidly identify and confirm effective therapies for patients with glioblastoma through response adaptive randomization and a seamless phase 2/3 design.

The trial, conceived by over 130 key opinion leaders, is conducted under a master protocol, allowing multiple therapies or combinations of therapies from different pharmaceutical partners to be evaluated simultaneously.

With its innovative design and efficient operational infrastructure, we believe data from the GBM AGILE Study can be used as the foundation for an NDA and biologics license application submissions and registrations to the U.S.

Food and Drug Administration (“FDA”) and other health authorities.

GCAR is a 501(c)(3) nonprofit organization uniting physicians, clinical researchers, advocacy and philanthropic organizations, biopharma, health authorities, and other key stakeholders in healthcare to expedite the discovery and development of treatments for patients with rare and deadly diseases by serving as sponsor of innovative and complex trials including master protocols and platform trials.

GCAR is the sponsor of GBM AGILE.

Key strategic partners for the GBM AGILE trial effort include the National Brain Tumor Society, National Foundation for Cancer Research, and Asian Fund for Cancer Research.

We have also undertaken research in ovarian cancer.

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In addition to our clinical development activities in the United States, pursuant to our collaboration with Guangxi Wuzhou Pharmaceutical (Group) Co.

(“Guangxi Wuzhou Pharmaceutical Company”), we have provided Guangxi Wuzhou Pharmaceutical Company certain commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous leukemia (“CML”) and lung cancer.

myelogenous leukemia (“CML”) and lung cancer.

Guangxi Wuzhou Pharmaceutical Company is the only manufacturer presently licensed by the China Food and Drug Administration (“CFDA”) to produce the product for the China market.

We have a broad patent portfolio to protect our intellectual property.

Our patent applications claim composition of matter and methods of use of VAL-083 and related compounds, synthetic methods, and quality con trols for the manufacturing process of VAL-083.

Our patent applications claim composition of matter and methods of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083.

We believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of VAL-083.

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Dose-confirming cohorts studying 20, 30, and 40 mg/m 2 /day x three every 21 days have been completed.

Based on the dose confirmation phase of the study, we have selected 30 mg/m 2 /day for combination with irradiation for the treatment of newl y-diagnosed MGMT-unmethylated GBM patients.

Based on the dose confirmation phase of the study, we have selected 30 mg/m 2 /day for combination with irradiation for the treatment of newly-diagnosed MGMT-unmethylated GBM patients.

This study is fully enrolled at 29 patients.

On June 22, 2020 at the AACR’s Virtual Annual Meeting II, we provided an update on patient data as follows:

For the 25 patients initially receiving the treatment dose that will be carried forward in the GBM AGILE pivotal study (30 mg/m 2 /day on days 1, 2 and 3 of a 21-day cycle) median progression-free survival (“PFS”) was reported to be 8.7 months (confidence interval, or CI 6.0-12.0 months) as of the May 15, 2020 cut-off date.

Overall PFS (n=29) with VAL-083 was also 8.7 months (CI 6.4-11.2 months).

While this is not a head-to-head study, historically, temozolomide (“TMZ”) has been demonstrated to have 6.9 months PFS in unmethylated GBM patients.

Other doses were also examined as part of the dose escalation aspect of the study, and all but the 20 mg/m 2 /day dose also demonstrated superior PFS to the historical comparator.

A median of eight cycles of treatment has been received by all patients who had either completed treatment, or remain in active treatment.

Nine patients have received ten or more cycles.

On November 19, 2020 at the virtual SNO Annual Meeting, we provided an update on patient data as follows:

For the 29 patients who had completed at least their first efficacy assessment as of the October 21, 2020 cut-off date, median PFS with VAL-083 is currently 9.3 months (95% confidence interval (“CI”) 6.4-12.0 months).

Additionally, for the 25 patients initially receiving the treatment dose that will be carried forward into the GBM AGILE pivotal Phase 3 study of 30 mg/m 2 /day on days 1, 2 and 3 of a 21-day cycle, median PFS was reported to be 8.7 months (CI 6.4-12.5 months).

While this is not a head-to-head study, this PFS data compares favorably to historical TMZ control data.

Published data from Hegi et al.

(2005 - New England Journal of Medicine) and Tanguturi et al.

(2017 - NeuroOncology) indicates that MGMT-unmethylated patients receiving the current standard of care have a median PFS of 5.3 months and 6.9 months, respectively.

Multiple treatment cycles of VAL-083 at the 30 mg/m 2 /day dose in combination with standard radiation treatment (2 Gy/day, 5 days/week) was shown to be generally safe and well-tolerated.

Phase 2 Study in MGMT-unmethylated GBM in Collaboration with University of Texas MD Anderson Cancer Center

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Recurrent Study Arm

The patients in the recurrent study arm are receiving second-line therapy with VAL-083 following TMZ failure.

As of May 28, 2020, 72 patients (out of a planned 83) have been enrolled in the recurrent arm of this study.

On June 22, 2020 at the AACR’s Virtual Annual Meeting II, we provided an update on patient data as follows:

In recurrent GBM, for the 37 patients initially receiving the intended treatment dose that will be carried forward in the GBM AGILE pivotal study (30 mg/m 2 /day on days 1, 2 and 3 of a 21-day cycle), median overall survival (mOS) is currently 8.5 months (CI 5.7-14.3 months) as of the May 28, 2020 cut-off date.

Overall mOS for the 72 patients who have completed at least one cycle of treatment was 7.1 months (CI 5.8-9.9 months).

On November 19, 2020 at the virtual SNO Annual Meeting, we provided an update on patient data as follows:

For patients in the recurrent group receiving second-line therapy with VAL-083 following first-line TMZ failure, 84 patients have been enrolled as of the data cut-off of October 23, 2020 with 35 patients (34 efficacy evaluable) having received an initial dose of 40 mg/m 2 /day and 49 (43 efficacy evaluable) having received the planned Phase 3 initial dose of 30 mg/ m2 /day (on days 1, 2 and 3 of a 21-day cycle).

For the 43 patients initially receiving the intended treatment dose that will be carried forward in the GBM AGILE pivotal study (30 mg/m 2 /day on days 1, 2 and 3 of a 21-day cycle), median overall survival (mOS) is currently 8.5 months (CI 6.8-13.7 months) as of the October 23, 2020 cut-off date.

mOS for the 77 patients who have completed at least one cycle of treatment was 7.6 months (CI 6.4-10.6 months).

While this is not a head-to-head study, historically, lomustine, which is the most commonly used chemotherapy for these patients, has demonstrated mOS of 7.2 months as indicated by published data from Wick et al.

(2017 – New England Journal of Medicine).

The safety profile in this study has been well within the existing safety monitoring guidelines described in the study protocol.

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A detailed description of this study can be found at clinicatrials.gov, Identifier Number:

Adjuvant Study Arm

On July 24, 2019, we announced the enrollment of the first patient in the adjuvant arm of the Phase 2 study being conducted at MDACC.

The adjuvant arm was originally planned for 24 patients, but based on encouraging outcomes, we plan to increase the adjuvant arm enrollment from the originally planned 24 patients to include up to 12 additional patients.

Newly-Diagnosed Adjuvant Study Arm

On July 24, 2019, we announced the enrollment of the first patient in the newly-diagnosed adjuvant arm of the Phase 2 study being conducted at MDACC.

The newly-diagnosed adjuvant arm was originally planned for 24 patients, but based on encouraging outcomes, we plan to increase the newly-diagnosed adjuvant arm enrollment from the originally planned 24 patients to include up to 12 additional patients.

These patients will have had initial cycles of temozolomide concomitant with radiation but will not have yet started subsequent cycles of TMZ (i.e., maintenance stage TMZ patients).

Published data from Tanguturi et al (2017 Nero-Oncology) indicates that MGMT-unmethylated patients receiving current standard of care have a median progression-free survival of 6.9 months.

On June 22, 2020 at the AACR’s Virtual An nual Meeting II, we provided an update on patient data as follows:

As of the data cut-off date of May 28, 2020, 19 evaluable subjects have completed at least one 21-day cycle of treatment, with a total of 25 subjects enrolled.

Enrollment for this arm was initiated in July 2019, and all 25 subjects enrolled to-date were alive at the data cut-off date.

On November 19, 2020 at the virtual SNO Annual Meeting, we provided an update on patient data as follows:

As of the data cut-off date of October 23, 2020, for the 27 efficacy evaluable patients (of a planned up to 36 patients) median PFS is currently 10.0 months (CI 7.6-10.8).

While this is not a head-to-head study, this PFS data compares favorably to historical TMZ control data of 5.3 months and 6.9 months as indicated by published data from Hegi et al.

(2005 - New England Journal of Medicine) and Tanguturi et al.

(2017 – NeuroOncology), respectively.

As noted above, patients in the recurrent arm of the MDACC clinical study have been heavily pre-treated with temozolomide.

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At the AACR’s annual meeting in April 2019, we reported that myelosuppression (thrombocytopenia and neutropenia) is the most common adverse event associated with VAL-083.

A detailed description of this study can be found at clinicatrials.gov, Identifier Number:

Safety Across Studies

Three subjects have experienced a serious adverse event (“SAE”), possibly related to VAL-083 in the newly-diagnosed study as of May 15, 2020, while as of May 28, 2020, 10 subjects have experienced a possibly drug-related SAE in the recurrent arm of the Phase 2 Study in MGMT-unmethylated GBM, and one patient has experienced a possibly drug-related SAE in the adjuvant arm of that study.

Consistent with prior studies, myelosuppression is the most common adverse event with VAL-083 in both the recurrent GBM and adjuvant treatment setting.

In the 30 mg/m 2 /day starting dose cohort (the planned dose for the GBM AGILE Study) three subjects have experienced a serious adverse event (SAE) possibly related to VAL-083 in the recurrent group and one patient has experienced a possibly drug-related SAE in the adjuvant group as of the relevant data cut-off dates.

VAL-083 Fast Track Designation

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Priority Review shortens the FDA review process for a new drug from ten months to six months and is appropriate for drugs that demonstrate significant improvements in both safety and efficacy of an existing therapy.

Rolling Review provides a drug company the opportunity to submit completed sections of its New Drug Application (“NDA”) for review by the FDA.

Rolling Review provides a drug company the opportunity to submit completed sections of its NDA for review by the FDA.

Typically, NDA reviews do not commence until the drug company has submitted the entire application to the FDA.

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Common symptoms of GBM include headaches, seizures, nausea, weakness, paralysis and personality or cognitive changes such as loss of speech or difficulty in thinking clearly.

GBM progresses quickly and patients’ conditions deteriorate rapidly progressing to death.

GBM progresses quickly and patients’ conditions deteriorate rapidly

progressing to death.

The outlook for GBM patients is generally poor.

The overall median survival in newly diagnosed GBM patients with best available treatments is less than 15 months, and two-year and five-year survival rates are approximately 30% and 10%, respectively .

Median overall survival in newly-diagnosed, unmethylated GBM patients is 12.2 months.

In September 2017, the NCCN updated treatment guidelines for GBM.

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Measurement of MGMT methylation status has become routine in clinical practice as biomarker that correlates with response to TMZ and patient outcomes in GBM.

Probability of GBM Patie nt Survival Correlated to Expression of MGMT Enzyme (Unmethylated promoter = High MGMT Expression and Significantly Shorter Survival)

Probability of GBM Patient Survival Correlated to Expression of MGMT Enzyme (Unmethylated promoter = High MGMT Expression and Significantly Shorter Survival)

TTF (Optune ® ) is a non-invasive technique for adults with GBM.

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We believe this offers the potential opportunity to improve upon the drug’s already established efficacy profile by substantially increasing the dose of VAL-083 that can be safely administered to cancer patients.

There is no evidence of lung, liver, or kidney toxicity even with prolonged treatment by VAL-083.

Data from the Chinese market where the drug has been approved for more than 15 years supports the safety findings of the NCI studies.

Through REM-001, we are developing our photodynamic therapy (“PDT”) for the treatment of rare, unmet medical needs.

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This led to late-stage clinical studies in CMBC and also in an aspect of “wet” age-related macular degeneration (“AMD”).

Of these two indications, AMD represented a much larger market, and in 1998, for what we believe were primarily business reasons, Miravant discontinued its CMBC program and, together with, or through its corporate partners, ultimately focused its REM-001 development efforts on AMD.

In 2004, Miravant submitted a new drug application (“NDA”) to the FDA for the use of REM-001 to treat an aspect of AMD.

In 2004, Miravant submitted a n NDA to the FDA for the use of REM-001 to treat an aspect of AMD.

The FDA reviewed this submission and granted Miravant an approvable letter for REM-001 in the treatment of AMD, with final approval contingent on, among other things, the successful completion of a Phase 3 study.

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Our review also indicates that Miravant never conducted an efficacy analysis of the 81 patients in the last two studies which were not yet complete when Miravant discontinued its CMBC program.

Based on our analysis of both the 81 CMBC patients , and data collected from the initia l 68 patients, we believe REM-001 Therapy provided promising safety and efficacy in CMBC patients and that, taken together, these results provide strong support for REM-001 Therapy as a potential therapy for this disease.

Furthermore, we believe the approv able letter previously granted to Miravant with respect to its NDA for REM-001 in an aspect of AMD may indicate that many of the elements required for approval have already been completed for REM-001.

Based on our analysis of both the 81 CMBC patients, and data collected from the initial 68 patients, we believe REM-001 Therapy provided promising safety and efficacy in CMBC patients and that, taken together, these results provide strong support for REM-001 Therapy as a potential therapy for this disease.

Furthermore, we believe the approvable letter previously granted to Miravant with respect to its NDA for REM-001 in an aspect of AMD may indicate that many of the elements required for approval have already been completed for REM-001.

Numerous approaches have been utilized to treat CMBC patients, including various forms of chemotherapy, radiation therapy, surgical excision, hyperthermia, cryotherapy, electro-chemotherapy, topical drugs, and intra-lesional chemotherapy injections.

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Cloud, sponsorship of two other INDs was transferred to us.

On February 25, 2013, the FDA’s Division of Dermatology and Dental Products notified us with a Change of Sponsor letter that it recognized us as the spon sor of IND 50,116.

On February 25, 2013, the FDA’s Division of Dermatology and Dental Products notified us with a Change of Sponsor letter that it recognized us as the sponsor of IND 50,116.

On May 8, 2013 the FDA’s Division of Transplant and Ophthalmology Products notified us with a Change of Sponsor letter that it recognized Adgero as the sponsor of IND 49,648.

At this time, we do not anticipate any of our planned, or cont emplated, clinical development activities would be under either of these INDs.

At this time, we do not anticipate any of our planned, or contemplated, clinical development activities would be under either of these INDs.

REM-001 Therapy

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A Phase 1 dose escalation clinical study was initially conducted by Miravant to establish the REM-001 dosimetry to be used in subsequent safety and efficacy studies.

The study was initiated in 1993 and enrolled 22 patients with a variety of types of cutaneous cancer lesions.

The study was initiated in 1993 and enrolled 22 patients with a variety of types of cutaneous

cancer lesions.

Of these, 213 cutaneous cancer lesions were treated using escalating REM-001 drug and light doses.

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Tumor Response as Measured by Paired Response was not possible in these studies since this measurement relies on control lesions and CA013 and CA019 did not include controls.

Miravant did not conduct an efficacy analysis of these two studies but we have conducted an analysis of the Quality of Life and Clinical Success endpoints used in the pivotal CA008 and CA009 stu dies.

Miravant did not conduct an efficacy analysis of these two studies but we have conducted an analysis of the Quality of Life and Clinical Success endpoints used in the pivotal CA008 and CA009 studies.

Results from that analysis are shown in the following table:

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However, because there are no approved therapies for CMBC, we have no basis for comparing these results to existing therapies.

Based on the FDA’s March 3, 2017 response, we believe the FDA will view these results as supportive data and our plan is to conduct a new pivotal Phase 3 study to support a new drug application.

Based on the FDA’s March 3, 2017 response, we believe the FDA will view these results as supportive data and our plan is to conduct a new pivotal Phase 3 study to support an NDA.

The figure below shows the results of our initial preliminary analysis of Miravant clinical data and depicts the percentage of evaluable lesions in each Miravant CMBC Study for which there was a complete response;

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In June 2018, we submitted to FDA a Phase 3 protocol and statistical analysis plan incorporating feedback received from the FDA at our October 2017 meeting.

At this time, we estimate the necessary study design will be a pivotal Phase 3 multi-cent er study that would enroll approximately 100-150 CMBC patients who have received prior radiation therapy and chemotherapy.

At this time, we estimate the necessary study design will be a pivotal Phase 3 multi-center study that would enroll approximately 100-150 CMBC patients who have received prior radiation therapy and chemotherapy.

This study has been designed with input from the FDA with the goal of gaining expedited development and review through one or more of the FDA’s expedited programs.

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Use of such a lower dose may have potential benefits including faster post-treatment healing and response assessment and lower drug exposure.

Based on this analysis and discussions with regulatory and clinical consultants, including prior FDA employees or consultants, a nd clinical research organizations, we plan to add a preliminary confirmatory element to our Phase 3 study.

Based on this analysis and discussions with regulatory and clinical consultants, including prior FDA employees or consultants, and clinical research organizations, we plan to add a preliminary confirmatory element to our Phase 3 study.

This confirmatory element anticipates treating up to 15 patients at a lower dose than used by Miravant.

Patients treated in this confirmatory phase will not be included in the pivotal study efficacy population but their results should provide an indication that a lower dose may be as effective as the original Miravant dose and they may be used to provide a further preliminary confirmation of the poten tial of REM-001 Therapy in CMBC and if the results are sufficiently compelling we may use them as guidance for the use of a slightly lowered dose in the pivotal study.

This confirmatory phase was included in the protocol submitted to FDA in June 2018 and w e have not received comment on this from FDA although based on guidance from our regulatory consultants we believe the FDA will be supportive of this design.

Patients treated in this confirmatory phase will not be included in the pivotal study efficacy population but their results should provide an indication that a lower dose may be as effective as the original Miravant dose and they may be used to provide a further preliminary confirmation of the potential of REM-001 Therapy in CMBC and if the results are sufficiently compelling, we may use them as guidance for the use of a slightly lowered dose in the pivotal study.

This confirmatory phase was included in the protocol submitted to FDA in June 2018 and we have not received comment on this from FDA although based on guidance from our regulatory consultants we believe the FDA will be supportive of this design.

If approved, the FDA grants five years of data exclusivity for a new chemical entity (“NCE”).

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Outstanding Securities

As of November 9, 2020, we had 24,662,299 shares of common stock issued and outstanding, outstanding warrants to purchase 11,697,068 shares of common stock, warrants to purchase 2,504 Series C Preferred Stock that upon exercise are convertible into 2,152,701 shares of common stock, outstanding stock options to purchase 6,508,569 shares of common stock, 648,613 outstanding shares of Series B Preferred Stock that are convertible into 162,177 shares of common stock, 25,028 outstanding shares of Series C Preferred Stock that are convertible into 21,516,484 shares of common stock.

As of February 10, 2021, we had 30,626,018 shares of common stock issued and outstanding, outstanding warrants to purchase 9,048,971 shares of common stock, warrants to purchase 2,504 Series C Preferred Stock that upon exercise are convertible into 2,152,701 shares of common stock, outstanding stock options to purchase 6,452,959 shares of common stock, 603,998 outstanding shares of Series B Preferred Stock that are convertible into 151,017 shares of common stock, 21,093 outstanding shares of Series C Preferred Stock that are convertible into 18,161,050 shares of common stock.

All common stock warrants and stock options are convertible, or exercisable into, one share of common stock.

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The financial information reported herein has been prepared in accordance with accounting principles generally accepted in the United States.

Our functional currency at September 30, 2020 and June 30, 2020 is the US$.

Our functional currency at December 31, 2020 and June 30, 2020 is the US$.

The following tables represent selected financial information for us for the periods presented.

Selected Balance Sheet Data

September 30,

(in thousands)

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For the three months ended

September 30,

(in thousands, except per share data)

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General and administrative

Other (income) loss

Foreign exchange loss

Amortization of deferred loan costs

Interest expense

Interest income

Net loss for the period

Series A Preferred cash dividend

Series B Preferred stock dividend

Net loss for the period attributable to common

Basic and fully diluted weighted average number of

Basic and fully diluted loss per share

For the six months ended

(in thousands, except per share data)

Research and development

General and administrative

In-process research and development

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For the three months ended

September 30,

(in thousands)

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share-based, compensation expense –

For the six months ended

(in thousands)

Research and development - GAAP

non-cash, share-based compensation

Research and development net of non-cash,

share-based, compensation expense –

General and administrative - GAAP

non-cash, share-based compensation

General and administrative net of non-cash,

share-based, compensation expense –

Results of Operations

Comparison of the three months ended September 30, 2020 and September 30, 2019

Comparison of the three months ended December 31, 2020 and December 31, 2019

Three months ended

September 30,

(in thousands)

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General and administrative

Other (income) loss

Foreign exchange loss

Amortization of deferred loan costs

Interest expense

Interest income

Research and Development

Research and development expenses increased to $2,584 for the three months ended December 31, 2020 from $712 for the three months ended December 31, 2019.

The increase was largely attributable to higher clinical development, non-cash, share-based compensation expenses and personnel costs incurred during the three months ended December 31, 2020 compared to the three months ended December 31, 2019.

Clinical development costs have increased in the current quarter compared to the prior quarter largely due to costs related to the GCAR GBM AGILE Study.

Patient recruitment commenced in January 2021 so there were costs incurred in order prepare the study for recruitment.

In addition, with the acquisition of the REM-001 technology as part of the Adgero merger that closed in August 2020, costs relating to clinical development and drug manufacturing activity have been incurred.

We expect our research and development costs to be higher in fiscal year 2021 than fiscal year 2020 as our GCAR GBM AGILE Study continues and we incur costs related to the development of REM-001.

Further, as a result of our acquisition of the REM-001 technology during the quarter ended September 30, 2020 costs were incurred in the current quarter for that technology that were not incurred in the corresponding quarter in the prior period.

Non-cash, share-based compensation expense increased for the three months ended December 31, 2020 compared to the three months ended December 31, 2019, due to the recognition of compensation expense for stock options granted in September 2020.

Personnel costs have increased in the current quarter compared to the prior quarter due to the addition of staff from the Adgero transaction.

General and Administrative

General and administrative expenses were $2,794 for the three months ended December 31, 2020 compared to $1,054 for the three months ended December 31, 2019.

A significant portion of the increase was due to higher non-cash, share-based compensation expenses and personnel costs incurred in the current three months compared to the prior three months.

In addition, non-cash, share-based compensation expense increased due to the issuance of warrants for professional services.

Personnel costs have increased in the current quarter compared to the prior quarter due to the addition of staff from the Adgero transaction.

Preferred Share Dividends

For each of the three months ended December 31, 2020 and 2019, we recorded $2 related to the dividend payable to Valent on the Series A preferred stock.

The dividend has been recorded as a direct increase in accumulated deficit for both periods.

During the three months ended December 31, 2020, we issued 3,479 (2019 – 3,700) shares of common stock as a dividend on the Series B Preferred stock and recognized $4 (2019 - $3) as a direct increase in accumulated deficit.

Comparison of the six months ended December 31, 2020 and December 31, 2019

Six months ended

(in thousands)

Research and development

General and administrative

In-process research and development

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Research and Development

Research and development expenses increased to $1,357 for the three months ended September 30, 2020 from $721 for the three months ended September 30, 2019.

The increase was largely attributable to higher clinical development, intellectual property and non-cash, share-based compensation expenses incurred during the three months ended September 30, 2020 compared to the three months ended September 30, 2019.

Clinical development costs have increased in the current period compared to the prior period largely due to the initiation costs related to GCAR.

In addition, with the acquisition of the REM-001 technology as part of the Adgero merger, costs relating to drug manufacturing activity have been incurred.

We expect our research and development costs to be higher in fiscal year 2021 than fiscal year 2020 as our GCAR GBM AGILE study commences.

In addition, our planned clinical activities, including drug manufacturing, for REM-001 commenced during the quarter ended September 30, 2020.

Intellectual property costs increased in the three months ended September 30, 2020 compared to the three months ended September 30, 2019 as we have incurred more foreign office actions in the current period than the prior period.

Research and development expenses increased to $3,941 for the six months ended December 31, 2020 from $1,434 for the six months ended December 31, 2019.

The increase was largely attributable to higher clinical development, non-cash, share-based compensation expenses, personnel, and intellectual property costs incurred during the six months ended December 31, 2020 compared to the six months ended December 31, 2019.

Clinical development costs have increased in the current period compared to the prior period largely due to the start-up and recruitment costs related to the GCAR GBM AGILE Study.

Patient recruitment commenced in January 2021 so there were costs incurred in order prepare the study for recruitment.

In addition, with the acquisition of the REM-001 technology as part of the Adgero merger, costs relating to clinical development and drug manufacturing activity have been incurred.

We expect our research and development costs to be higher in fiscal year 2021 than fiscal year 2020 as our GCAR GBM AGILE Study continues and we incur costs related to the development of REM-001.

Further, as a result of our acquisition of the REM-001 technology during the quarter ended September 30, 2020, costs were incurred for that technology in the six months ended December 31, 2020 that were not incurred in the corresponding prior period.

Personnel costs have increased in the current quarter compared to the prior quarter due to the addition of staff from the Adgero transaction.

Intellectual property costs increased in the six months ended December 31, 2020 compared to the six months ended December 31, 2019 as we have incurred more foreign office actions in the current period than the prior period.

Patent costs can vary considerably depending on the filing of new patents, conversion of the provisional applications to PCT applications, foreign office actions, and actual filing costs.

Non-cash, share-based compensation expense increased for the three months ended September 30, 2020, due to stock options granted in September 2020.

General and Administrative

General and administrative expenses were $1,534 for the three months ended September 30, 2020 compared to $914 for the three months ended September 30, 2019.

A significant portion of the increase was due to higher professional fees, office and sundry expenses, and non-cash, share-based compensation expense incurred in the current three months compared to the prior three months.

Professional fees increased during the three months ended September 30, 2020 compared to the three months ended September 30, 2019 primarily due to higher legal and accounting fees in the current period.

Office and sundry increased in the three months ended September 30, 2020 compared to the three months ended September 30, 2019 due primarily to costs of higher directors’ and officers’ liability insurance.

In relation to general and administrative expenses during the three months ended September 30, 2020, we incurred non-cash, share-based compensation expense relating to warrants issued for services and stock option expense while during the three months ended September 30, 2019, we incurred non-cash, share-based compensation expense relating to stock option expense only.

The higher stock option expense in the current period compared to the prior period was due to stock options granted in September 2020.

General and administrative expenses were $4,329 for the six months ended December 31, 2020 compared to $1,967 for the six months ended December 31, 2019.

A significant portion of the increase was due to higher non-cash, share-based compensation expense, office and sundry expenses, personnel, and professional fees incurred in the current six months compared to the prior six months.

In addition, non-cash, share-based compensation expense increased due to the issuance of warrants for professional services.

Office and sundry increased in the six months ended December 31, 2020 compared to the six months ended December 31, 2019 due primarily to costs of higher directors’ and officers’ liability insurance.

Professional fees increased during the six months ended December 31, 2020 compared to the six months ended December 31, 2019 primarily due to higher legal and accounting fees in the current period.

Personnel costs have increased in the current quarter compared to the prior quarter due to the addition of staff from the Ad g ero transaction.

Merger costs of $500 relate to expenditures with respect to the Adgero transaction and have been expensed.

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We acquired in-process research and development assets in connection with our merger with Adgero.

As the acquired in-process research and development assets were deemed to have no current or alternative future use, an expense of $16.1 million was recognized in the condensed consolidated interim statements of operations for the three month period ended September 30, 2020.

Preferred Share Dividends

For each of the three months ended September 30, 2020 and 2019, we recorded $2 related to the dividend payable to Valent on the Series A preferred stock.

For each of the six months ended December 31, 2020 and 2019, we recorded $4 related to the dividend payable to Valent on the Series A preferred stock.

The dividend has been recorded as a direct increase in accumulated deficit for both periods.

During the three months ended September 30, 2020, we issued 3,700 (2019 – 3,700) shares of common stock as a dividend on the Series B Preferred stock and recognized $5 (2019 - $2) as a direct increase in accumulated deficit.

During the six months ended December 31, 2020, we issued 7,179 (2019 – 7,400) shares of common stock as a dividend on the Series B Preferred stock and recognized $9 (2019 - $5) as a direct increase in accumulated deficit.

Liquidity and Capital Resources

Three months ended September 30, 2020 compared to the three months ended September 30, 2019

September 30,

Six months ended December 31, 2020 compared to the six months ended December 31, 2019

(in thousands)

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Operating Activities

Net cash used in operating activities increased to $4,110 for the three months ended September 30, 2020 from $2,266 for the three months ended September 30, 2019.

During the three months ended September 30, 2020 and 2019, we reported net losses of $19,518 and $1,606, respectively.

Net cash used in operating activities increased to $9,541 for the six months ended December 31, 2020 from $3,977 for the six months ended December 31, 2019.

During the six months ended December 31, 2020 and 2019, we reported net losses of $24,931 and $3,346, respectively.

Partially offsetting the higher loss in the current period compared to the prior period was the recognition of $16,094 of acquired in-process research and development expense related to the Adgero merger.

Additional changes in adjustments to reconcile net loss to net cash used in operating activities for the three months ended September 30, 2020 included stock option expense of $405 being recognized during the current period compared to $51 in the prior period.

The most significant changes in working capital for the three months ended September 30, 2020 were from uses of cash due to a decrease in accounts payable and accrued liabilities of $914 as well as $282 related to a decrease in related party payables.

The most significant change in working capital for the three months ended September 30, 2019 was cash from a reduction in accounts payable and accrued liabilities of $617.

Additional changes in adjustments to reconcile net loss to net cash used in operating activities for the six months ended December 31, 2020 included stock option expense of $2,530 being recognized during the current period compared to $211 in the prior period.

The most significant change in working capital for the six months ended December 31, 2020 was from a use of cash due to an increase prepaid expenses and deposits related to a $2,600 payment to GCAR for study initiation and patient recruitment.

The most significant change in working capital for the six months ended December 31, 2019 was cash used as a reduction in accounts payable and accrued liabilities of $994.

Investing Activities

As part of the Adgero merger that closed on August 19, 2020, we acquired $969 in cash.

There were no investing activities during the three months ended September 30, 2019.

There were no investing activities during the six months ended December 31, 2019.

Financing Activities

During the three months ended September 30, 2020, we received $21.6 million in net proceeds from the completion of a private placement of Series C Preferred stock and $994 from exercise of stock purchase warrants.

Also, during the three months ended September 30, 2020, we received proceeds from the NBTS Loan of $500.

During the three months ended September 30, 2019, we received $6,583 in net proceeds from the completion of an underwritten public offering by us of common stock, pre-funded warrants, and common stock purchase warrants.

During the six months ended December 31, 2020, we received approximately $21,600 in net proceeds from the completion of a private placement of Series C Preferred stock and $1,180 from the cash exercise of stock purchase warrants.

Also, during the six months ended December 31, 2020, we received proceeds from the NBTS Loan of $500.

During the six months ended December 31, 2019, we received $6,583 in net proceeds from the completion of an underwritten public offering by us of common stock, pre-funded warrants, and common stock purchase warrants.

Additionally, we received $26 pursuant to the exercise of warrants in the current period.

Liquidity Risk and Capital Expenditure Requirements

Liquidity Risk and Management Plans

Going Concern and Capital Expenditure Requirements

Going Concern and Management Plans

(See note 1 to the condensed consolidated interim financial statements)

During the three months ended September 30, 2020, the Company reported a net loss of $19.5 million.

As of September 30, 2020, the Company had $22.6 million of cash and cash equivalents and used $4.1 million of cash in its operating activities during the three months ended September 30, 2020.

The Company is in the clinical stage and has not generated any revenues to-date.

The Company does not have the prospect of achieving revenues until such time that its product candidates are commercialized, or partnered, which may not ever occur.

In the future, the Company will require additional funding to maintain its clinical trials, research and development projects, and for general operations.

The Company may tailor its drug development programs based on the amount of funding the Company is able to raise in the future.

During the three months ended September 30, 2020, the Company completed a private placement in three closings for aggregate net proceeds of approximately $21.6 million (note 6).

The Company believes that based on its current estimates, the cash and cash equivalents at September 30, 2020 of $22.6 million, as well as cash from the proceeds from stock purchase warrants exercised subsequent to September 30, 2020, will be sufficient to fund its planned operations for at least the next twelve months from the date these condensed consolidated interim financial statements are issued.

The condensed consolidated interim financial statements have been prepared on a going concern basis, which assumes that we will continue our operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the normal course of business .

For the six months ended December 31, 2020, we reported a loss of $24.9 million, and a negative cash flow from operations of $9.5 million.

We had an accumulated deficit of $97.8 million and had cash and cash equivalents of $17.2 million as of December 31, 2020.

We are in the clinical stage and have not generated any revenues to-date.

We do not have the prospect of achieving revenues until such time that our product candidates are commercialized, or partnered, which may not ever occur.

In the near future, we will require additional funding to maintain our clinical trials, research and development projects, and for general operations.

These circumstances indicate substantial doubt exists about our ability to continue as a going concern within one year from the date of filing of the condensed consolidated interim financial statements.

Consequently, management is pursuing various financing alternatives to fund our operations so we can continue as a going concern.

However, the coronavirus (“COVID-19”) pandemic has created significant economic uncertainty and volatility in the credit and capital markets.

The ultimate impact of the COVID-19 pandemic on the Company’s ability to raise additional capital in the future is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak and any new information which may emerge concerning the severity of the COVID-19 pandemic.

Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements but the ultimate impact of the COVID-19 pandemic on our ability to raise additional capital is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak and any new information which may emerge concerning the severity of the COVID-19 pandemic.

We may not be able to raise sufficient additional capital and may tailor our drug candidate development program based on the amount of funding we are able to raise in the future.

Nevertheless, there is no assurance that these initiatives will be successful.

The condensed consolidated interim financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may be necessary should we be unable to continue as a going concern.

Such adjustments could be material.

Our future funding requirements will depend on many factors, including but not limited to:

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the impact of us being a public entity.

Until we can generate a sufficient amount o f product revenue to finance our cash requirements, which we may never do, we expect to finance future cash needs primarily through public or private equity offerings, or strategic collaborations.

The sale of equity and convertible debt securities may resu lt in dilution to our stockholders and certain of those securities may have rights senior to those of our shares of capital stock.

If we raise additional funds through the issuance of preferred stock, convertible debt securities or other debt financing, th ese securities or other debt could contain covenants that would restrict our operations.

Until we can generate a sufficient amount of product revenue to finance our cash requirements, which we may never do, we expect to finance future cash needs primarily through public or private equity offerings, or strategic collaborations.

The sale of equity and convertible debt securities may result in dilution to our stockholders and certain of those securities may have rights senior to those of our shares of capital stock.

If we raise additional funds through the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain covenants that would restrict our operations.

Any other third-party funding arrangement could require us to relinquish valuable rights.

Economic conditions may affect the availability of funds and activity in equi ty markets.

Economic conditions may affect the availability of funds and activity in equity markets.

We do not know whether additional funding will be available on acceptable terms, or at all.

If we are not able to secure additional funding when needed, we may have to delay, reduce the scope of or eliminate one or more of our clinical trials o r research and development programs or make changes to our operating plan.

If we are not able to secure additional funding when needed, we may have to delay, reduce the scope of or eliminate one or more of our clinical trials or research and development programs or make changes to our operating plan.

In addition, we may have to seek a partner for one or more of our product candidates at an earlier stage of development, which would lower the economic value of those programs to us.

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Prior to our adoption of ASU 2018-07, Compensation-Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), stock options granted to non-employee consultants were revalued at the end of each reporting period until vested using the Black-Scholes option-pricing model and the changes in their fair value were recorded as adjustments to expense over the related vesting period.

For the three-months ended September 30, 2020, the determination of grant-date fair value for stock option awards was estimated using the Black-Scholes model, which includes variables such as the expected volatility of our share price, the anticipated exercise behavior of its grantee, interest rates, and dividend yields.

For the three-months ended September 30, 2020, we utilized the plain vanilla method to determine the expected life of stock options.

For the six-months ended December 31, 2020 and 2019, the determination of grant-date fair value for stock option awards was estimated using the Black-Scholes model, which includes variables such as the expected volatility of our share price, the anticipated exercise behavior of its grantee, interest rates, and dividend yields.

For the six-months ended December 31, 2020 and 2019, we utilized the plain vanilla method to determine the expected life of stock options.

These variables are projected based on our historical data, experience, and other factors.

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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 2. Management’s Discussion and Analysis