Scinai Reports Third Quarter 2023 Financial Results and Provides Business Update
JERUSALEM, Oct. 31, 2023 (GLOBE NEWSWIRE) -- via IBN -- Scinai Immunotherapeutics Ltd (Nasdaq: SCNI), a biopharmaceutical company focused on developing, manufacturing, and commercializing innovative inflammation and immunology (I&I) biological products primarily for the treatment of autoimmune and infectious diseases, announced the publication today of its financial results for the third quarter ended Sept. 30, 2023 and provided a business update.
THIRD QUARTER 2023 FINANCIAL SUMMARY
- R&D expenses for the three months ended Sept. 30, 2023 amounted to $1.13 million compared to $1.19 million for the three months ended Sept. 30, 2022.
- Marketing, general and administrative expenses for the three months ended Sept. 30, 2023 amounted to $0.97 million compared to $0.96 million for the three months ended Sept. 30, 2022.
- Total operating expenses for the three months ended Sept. 30, 2023 amounted to $2.1 million compared to $2.1 million for the three months ended Sept. 30, 2022.
- Financial income for the three months ended Sept. 30, 2023 amounted to $5.2 million compared to $6.9 million income for the three months ended Sept. 30, 2022.
- Net Income (loss) for the three months ended Sept. 30, 2023 amounted to $3.1 million income compared to $4.7 million loss for the three months ended Sept. 30, 2022.
As of Sept. 30, 2023, Scinai had cash and cash equivalents of $6.4 million as compared to $14.2 million as of Dec. 31, 2022.
In the nine months ended Sept. 30, 2023, Scinai had an operating loss of $7.8 million and negative cash flows from operating activities of $8.1 million.
A summary of unaudited financial results is included in the tables below.
BUSINESS UPDATE
Strategic pivot
- In support of the Company’s strategic pivot, in Sept. 2023, we in gross proceeds ($1.08 million in net proceeds) via a registered direct offering with H.C. Wainwright & Co. acting as placement agent.
- In order to extend our cash runway and address the Nasdaq minimum shareholders’ equity compliance issue, our primary creditor, the European Investment Bank (EIB), is currently considering favorably adjusting the terms of the EIB’s financial facility contract with the Company, in particular by extending the facility’s maturity. There is no guarantee that the EIB will approve the adjustment of the terms of the EIB’s financial facility with the Company. In addition, we are implementing a cost saving plan as mentioned in our .
- As part of the strategic pivot, in September 2023 the company .
New CDMO Business Unit’s first client
- In October 2023, the Company closed its first contract to provide CDMO services. We are in advanced contract discussions with several other potential clients. In addition, we are pursuing extensive targeted marketing activities, including participation at major pharmaceutical conferences such as CPHI in Barcelona (October 2023) and BIO-Europe in Munich (November 2023).
Pipeline Development
- We are aggressively advancing the NanoAb preclinical development. Meaningful ex vivo results for our IL-17 NanoAb tested in human psoriatic skin specimens are anticipated in Q4 ’23, and we continue to expect to enter clinical testing of the NanoAb as a biobetter psoriasis treatment in 2024.
- NanoAbs for treatment of additional autoimmune diseases, such as asthma and wet AMD have been discovered and characterized at Max Planck and University Medical Center Göttingen as part of their research collaboration agreement with Scinai. Scinai holds exclusive options for exclusive licenses at pre agreed financial terms for each of the resulting NanoAbs.
- We are pursuing a strategic partnership for our COVID-19 self-administered inhaled NanoAb which demonstrated highly promising in vivo results in animals as both a therapeutic and prophylactic treatment.
About Scinai Immunotherapeutics Ltd.
Scinai Immunotherapeutics Ltd. (Nasdaq: SCNI) is a biopharmaceutical company focused on developing, manufacturing, and commercializing innovative inflammation and immunology (I&I) biological products primarily for the treatment of autoimmune and infectious diseases. With a state-of-the-art facility for biopharmaceutical product development and manufacturing and highly experienced pharmaceutical industry leadership, Scinai offers end-to-end boutique CDMO services in parallel to developing its own pipeline of diversified and commercially viable products and platforms beginning with an innovative nanosized VHH antibody (NanoAb) pipeline targeting diseases with large unmet medical needs. Company website: .
Company Contact
Joshua Phillipson | |
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Litigation Reform Act of 1995. Words such as "expect," "believe," "intend," "plan," "continue," "may," "will," "anticipate," and similar expressions are intended to identify forward-looking statements. All statements, other than statements of historical facts, included in this press release regarding strategy, future operations, future financial position, future revenue, projected expenses, prospects, plans and objectives of management are forward-looking statements. Examples of such statements include, but are not limited to, statements regarding the Company’s cash runway, adjustments to the terms of the EIB’s loan to the Company and compliance with the Nasdaq Listing Rules. These forward-looking statements reflect management's current views with respect to certain current and future events and are subject to various risks, uncertainties and assumptions that could cause the results to differ materially from those expected by the management of Scinai Immunotherapeutics Ltd. Risks and uncertainties include, but are not limited to, the risk that the EIB will not agree to adjust the terms of its loan to the Company, that the Company’s ADSs will not return to compliance with the Nasdaq Listing Rules, that Scinai may not be able to secure additional capital on attractive terms, if at all, and the risk that the Company’s cash runway will be extended; the risk that the therapeutic and commercial potential of NanoAbs will not be met; the risk of a delay in the preclinical and clinical trials data for NanoAbs, if any; the risk that our business strategy may not be successful; the risk that the European Investment Bank (EIB) may accelerate the loans under its finance contract with Scinai; Scinai's ability to acquire rights to additional product opportunities; Scinai's ability to enter into collaborations on terms acceptable to Scinai or at all; timing of receipt of regulatory approval of Scinai’s manufacturing facility in Jerusalem, if at all or when required; the risk that the manufacturing facility will not be able to be used for a wide variety of applications and other vaccine and treatment technologies; and the risk that drug development involves a lengthy and expensive process with uncertain outcomes. More detailed information about the risks and uncertainties affecting the Company is contained under the heading "Risk Factors" in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 17, 2023. Scinai undertakes no obligation to revise or update any forward-looking statement for any reason.
| CONDENSED BALANCE SHEETS (Unaudited) | |||||
| U.S. dollars in thousands (except share and per share data) | |||||
| | | ||||
| September 30, | December 31, | ||||
| 2023 | 2022 | ||||
| Unaudited | Audited | ||||
| ASSETS | |||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | 6,362 | 14,075 | |||
| Restricted cash | 122 | 140 | |||
| Prepaid expenses and other receivables | 228 | 155 | |||
| Total current assets | 6,712 | 14,370 | |||
| NON-CURRENT ASSETS: | |||||
| Property, plant and equipment, net | 10,660 | 11,245 | |||
| Operating lease right-of-use assets | 1,210 | 1,452 | |||
| Total non-current assets | 11,870 | 12,697 | |||
| Total assets | 18,582 | 27,067 | |||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
| CURRENT LIABILITIES: | |||||
| Trade payables | 546 | 716 | |||
| Operating lease liabilities | 382 | 382 | |||
| Other payables | 610 | 1,240 | |||
| Total current liabilities | 1,538 | 2,338 | |||
| NON-CURRENT LIABILITIES: | |||||
| Warrants liability | 311 | 5,329 | |||
| Loan from others | 18,602 | 20,082 | |||
| Non-current operating lease liabilities | 823 | 1,078 | |||
| Total non-current liabilities | 19,736 | 26,489 | |||
| CONTINGENT LIABILITIES AND COMMITMENTS | |||||
| SHAREHOLDERS’ EQUITY (DEFICIT): | |||||
| Ordinary shares of no par value: Authorized: 20,000,000,000 shares at September 30, 2023 and at December 31, 2022; Issued and outstanding 1,740,770,784 shares at September 30, 2023 and 989,290,784 shares at December 31, 2022 | - | - | |||
| Additional paid-in capital | 119,053 | 116,082 | |||
| Accumulated deficit | (120005 | ) | (115835 | ) | |
| Accumulated other comprehensive loss | (1740 | ) | (2007 | ) | |
| Total shareholders’ deficit | (2692 | ) | (1760 | ) | |
| Total liabilities and shareholders’ deficit | 18,582 | 27,067 | |||
| CONDENSED STATEMENTS OF OPERATIONS (Unaudited) | ||||||||||||||
| U.S. dollars in thousands (except share and per share data) | ||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||
| Unaudited | ||||||||||||||
| Research and development expenses, net | 1,134 | 1,194 | 4,583 | 4,331 | ||||||||||
| Marketing, general and administrative | 968 | 967 | 3,300 | 3,708 | ||||||||||
| Total operating loss | 2,102 | 2,161 | 7,883 | 8,039 | ||||||||||
| Financial loss (income), net | (5,209 | ) | (6,939 | ) | (3,713 | ) | (7,359 | ) | ||||||
| Net loss (income) | (3,107 | ) | (4,778 | ) | 4,170 | 680 | ||||||||
| Net Gain loss (Gain) per share attributable to | | | | | | | ||||||||
| basic ordinary shareholders, | (0.002 | ) | (0.01 | ) | 0.002 | 0.001 | ||||||||
| diluted ordinary shareholders | (0.002 | ) | (0.01 | ) | 0.002 | 0.001 | ||||||||
| Weighted average number of shares used for computing basic net loss per share | 1,876,885,253 | 781,436,944 | 1,682,990,012 | 746,294,693 | ||||||||||
| CONDENSEDSTATEMENTS OF COMPREHENSIVE LOSS (Unaudited) | ||||||||||||
| U.S. dollars in thousands (except share and per share data) | ||||||||||||
| Three months ended | Nine months ended | |||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||
| Unaudited | ||||||||||||
| Net loss (income) | (3,107 | ) | $ | (4,778 | ) | 4,170 | 680 | |||||
| Other comprehensive (income) loss: | ||||||||||||
| Foreign currency translation adjustments | - | 413 | 267) | ( | 460 | |||||||
| Total comprehensive loss | (3,107 | ) | (4,365( | 3,903 | 1,140 | |||||||
| CONDENSED STATEMENTS CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited) | |||||||||||||||
| U.S. dollars in thousands (except share and per share data) | |||||||||||||||
| Three months ended September 30, 2023 | |||||||||||||||
| Ordinary shares | Additional paid-in | Accumulated | Accumulated | Total shareholders’ | |||||||||||
| Number | Amount | capital | comprehensive loss | deficit | equity | ||||||||||
| Balance as of June 30, 2023 | 1,453,970,784 | - | 117,740 | (1,740 | ) | (123,112 | ) | (7,112 | ) | ||||||
| Exercise of warrants | 120,000,000 | - | - | - | - | - | |||||||||
| Vested RSU's | 6,800,000 | - | - | - | - | - | |||||||||
| Issuance of shares and warrants, net | 160,000,000 | 1,086 | 1,086 | ||||||||||||
| Share-based compensation | - | - | 227 | - | - | 227 | |||||||||
| Other comprehensive income | - | - | - | - | - | - | |||||||||
| Net Gain | - | - | - | - | 3,107 | 3,107 | |||||||||
| Balance as of September 30, 2023 | 1,740,770,784 | - | 119,053 | (1,740 | ) | (120,005 | ) | (2,692 | ) | ||||||
| | | | | | | | | | | ||||||
| Nine months endedSeptember30, 2023 | |||||||||||||||
| Ordinary shares | Additional paid-in | Accumulated | Accumulated | Total shareholders’ | |||||||||||
| Number | Amount | capital | comprehensive loss | deficit | equity | ||||||||||
| Balance as of January 1, 2023 | 989,290,784 | - | 116,082 | (2,007 | ) | (115,835 | ) | (1,760 | ) | ||||||
| Exercise of warrants | 584,015,200 | - | 801 | - | - | 801 | |||||||||
| Vested RSU's | 7,464,800 | - | - | - | - | - | |||||||||
| Issuance of shares and warrants, net | 160,000,000 | 1,484 | 1,484 | ||||||||||||
| Share-based compensation | - | - | 686 | - | - | 686 | |||||||||
| Other comprehensive income | - | - | - | 267 | - | 267 | |||||||||
| Net loss | - | - | - | - | (4,170 | ) | (4,170 | ) | |||||||
| Balance as of September 30, 2023 | 1,740,770,784 | - | 119,053 | (1,740 | ) | (120,005 | ) | (2,692 | ) | ||||||
| Three months ended June 30, 2022 | |||||||||||||||
| Ordinary shares | Additional paid-in | Accumulated | Accumulated | Total shareholders’ | |||||||||||
| Number | Amount | capital | comprehensive loss | deficit | equity | ||||||||||
| Balance as of June 30, 2022 | 747,153,064 | - | $114,335 | (2,102 | ) | (115,497 | ) | (3,264 | ) | ||||||
| Share-based compensation | - | 341 | - | - | 341 | ||||||||||
| Other comprehensive loss | - | - | - | (413 | ) | - | (413 | ) | |||||||
| Net loss | - | - | - | - | 4,778 | 4,778 | |||||||||
| Balance as of September 30, 2022, | 747,153,064 | - | 114,676 | (2,515 | ) | (110,719 | ) | 1,442 | |||||||
| Nine months ended September 30, 2022 | |||||||||||||||
| Ordinary shares | Additional paid-in | Accumulated | Accumulated | Total shareholders’ | |||||||||||
| Number | Amount | capital | comprehensive loss | deficit | equity | ||||||||||
| Balance as of January 1, 2022 | 739,048,544 | - | 113,076 | )2,055 | ) | (110,039 | ) | 982 | |||||||
| Issuance of shares, net of issuance costs of $6 | 6,000,000 | - | 216 | - | - | 216 | |||||||||
| Vested RSU's | 2,104,520 | - | - | - | - | - | |||||||||
| Expiration of employees options | - | 180 | - | - | 180 | ||||||||||
| Share-based compensation | - | 1,204 | - | - | 1,204 | ||||||||||
| Other comprehensive loss | - | - | - | (460 | ) | - | (460 | ) | |||||||
| Net loss | - | - | - | - | (680 | ) | (680 | ) | |||||||
| Balance as of September 30, 2022, | 747,153,064 | - | 114,676 | (2,515 | ) | (110,719 | ) | 1,442 | |||||||
Starting July 1, 2023 the company’s functional currency is USD.
| CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) | |||||
| U.S. dollars in thousands (except share and per share data) | |||||
| Nine months ended | |||||
| 2023 | 2022 | ||||
| Unaudited | Unaudited | ||||
| Cash flows from operating activities: | |||||
| Net loss | (4,170 | ) | (680 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||
| Depreciation of property, plant and equipment | 430 | 378 | |||
| Expense of in-process research and development | - | 179 | |||
| Financial expenses related to loan from others | (369 | ) | (6,948 | ) | |
| Share-based compensation | 686 | 1,204 | |||
| Decrease in other receivables | (82 | ) | 96 | ||
| Warrants revaluation | (3,924 | ) | - | ||
| Changes in operating lease right-of-use assets | (14 | ) | (10 | ) | |
| Increase in trade payables | (135 | ) | (580 | ) | |
| Changes in operating lease liabilities | - | 10 | |||
| (Decrease) increase in other payables | (579 | ) | (321 | ) | |
| Net cash used in operating activities | (8,157 | ) | (6,672 | ) | |
| Cash flows from investing activities: | |||||
| Purchase of property, plant and equipment | (403 | ) | (566 | ) | |
| Net cash used in investing activities | (403 | ) | (566 | ) | |
| CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) | |||||
| U.S. dollars in thousands (except share and per share data) | |||||
| Nine months ended | |||||
| 2023 | 2022 | ||||
| Unaudited | Unaudited | ||||
| Cash flows from financing activities: | |||||
| Issuance of shares and warrants | 1,086 | - | |||
| Net cash provided by financing activities | 1,086 | - | |||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (258 | ) | (1,826 | ) | |
| Decrease in cash, cash equivalents and restricted cash | (7,732 | ) | (9,064 | ) | |
| Cash, cash equivalents and restricted cash at the beginning of the period | 14,215 | 17,518 | |||
| Cash, cash equivalents and restricted cash at the end of the period | 6,484 | 8,447 | |||
| Supplementary disclosure of cash flows activities: | |||||
| (1) Cash paid during the year for: | |||||
| Interest | 725 | - | |||
| (2) Non-cash transactions: | |||||
| Issuance of warrants | 1,345 | - | |||
| Exercise of warrants liability to equity | 801 | - | |||
| Reconciliation of cash, cash equivalents and restricted cash: | |||||
| Cash and cash equivalents | 6,362 | 8,310 | |||
| Restricted cash | 122 | 137 | |||
| Cash, cash equivalents and restricted cash | 6,484 | 8,447 | |||
Notes in the Company’s audited financial reports are an integral part of the financial statements and are filed with the Securities and Exchange Commission.
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