Sio Gene Therapies Inc. (NASDAQ: SIOX) today provided financial
results for its fiscal second quarter ended September 30, 2022.
“Our financial results continue to show the beneficial effects
on operating expenses and cash burn resulting from the termination
of the licenses to our three clinical-stage programs, the
significant workforce reduction initiated in April and successful
negotiations with vendors and landlords. We continue to conduct
research activities relating to one pre-clinical program and also
expect to provide an update on our strategic process by December
31, 2022,” said David Nassif, J.D., Chief Executive Officer of Sio
Gene Therapies.
Fiscal Second Quarter Financial
Summary
Research and development expenses were $0.3 million for the
three months ended September 30, 2022 and $11.4 million for
the three months ended September 30, 2021. The $11.1 million
decrease was primarily related to decreases in:
(i) program-specific costs relating
to our prior AXO-Lenti-PD and AXO-AAV-GM1 and AXO-AAV-GM2 programs,
which decreased $8.6 million as we wound down our clinical-stage
programs subsequent to our termination of the Oxford Biomedica and
UMass agreements; and
(ii) unallocated internal costs,
which decreased $2.5 million primarily due to reductions in
personnel-related costs after announcing the discontinuation of our
clinical-stage programs and initiating a significant reduction in
workforce in April 2022. Other costs incurred during the three
months ended September 30, 2022 included $0.7 million related to
the early termination of the laboratory space lease in Durham,
North Carolina and $0.6 million of losses on sales of equipment and
furniture related to the termination of that lease.
General and administrative expenses were $2.9 million for the
three months ended September 30, 2022 and $9.7 million for the
three months ended September 30, 2021. The decrease of $6.8
million was primarily due to decreases of $6.6 million in
stock-based compensation expense, $5.9 million of which results
from prior year expense associated with Roivant Sciences Ltd.
(“RSL”) equity instruments held by our former Chief Executive
Officer, and $0.6 million in personnel-related expenses related to
the workforce reduction that commenced in April 2022.
The net loss for the fiscal second quarter ended September 30,
2022 was $3.1 million, or $0.04 per share, compared to a net loss
of $21.2 million, or $0.29 per share, in the fiscal second quarter
ended September 30, 2021.
As of September 30, 2022, we had $49.86 million of cash and cash
equivalents. We hold no short-term or long-term debt on the balance
sheet.
Fiscal First Half Financial Summary
Research and development expenses were $5.9 million for the six
months ended September 30, 2022 and $19.5 million for the six
months ended September 30, 2021. The $13.6 million decrease
was primarily related to decreases in:
(i) program-specific costs relating
to our prior AXO-Lenti-PD and AXO-AAV-GM1 and AXO-AAV-GM2 programs,
which decreased $9.1 million as we wound down our clinical-stage
programs subsequent to our termination of the Oxford Agreement and
the UMMS Agreement; and
(ii) unallocated internal costs,
which decreased $4.6 million primarily due to reductions in
personnel-related costs after announcing the discontinuation of our
clinical-stage programs and initiating a significant reduction in
workforce in April 2022. Personnel-related costs incurred during
the six months ended September 30, 2022 included $0.7 million of
severance expense. Other costs incurred during the six months ended
September 30, 2022 included $0.7 million related to the early
termination of the laboratory space lease in Durham, North Carolina
and $0.6 million of losses on sales of equipment and furniture
related to the termination of that lease. Further, stock-based
compensation expense incurred during the six months ended September
30, 2022 benefited from the reversal of $0.4 million from prior
periods resulting from the workforce reduction.
General and administrative expenses were $5.9 million for the
six months ended September 30, 2022 and $13.6 million for the
six months ended September 30, 2021. The decrease of $7.7
million was primarily due to a decrease of $7.2 million in
stock-based compensation expense, $5.9 million of which results
from prior year expense associated with RSL equity instruments held
by our former Chief Executive Officer, and a decrease of $1.1
million in personnel-related expenses.
The net loss for the six months ended September 30, 2022 was
$11.5 million, or $0.16 per share, compared to a net loss of $33.1
million, or $0.45 per share, for the six months ended September 30,
2021.
Forward-Looking Statements
This press release contains forward-looking statements for the
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995 and other federal securities laws.
The use of words such as "expect," "estimate," "may" and other
similar expressions are intended to identify forward-looking
statements. For example, all statements Sio makes regarding costs
associated with its operating activities, potential cost savings
and other benefits from cost reduction activities, potential
strategic alternatives and related timing, and funding requirements
and/or cash burn runway are forward-looking. All forward-looking
statements are based on estimates and assumptions by Sio’s
management that, although Sio believes to be reasonable, are
inherently uncertain. All forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ
materially from those that Sio expected. Such risks and
uncertainties include, among others, the impact of the Covid-19
pandemic on Sio’s operations; the actual funds required for our
planned operating activities, including wind-down activities for
clinical programs and exploration of strategic alternatives; costs,
risks and timing related to headcount reductions and capital
conservation plans; the ability to explore and execute upon
strategic alternatives, including in an uncertain macroeconomic
environment; the ability to efficiently wind down clinical programs
and conduct required activities during wind down processes; and the
outcome of interactions with regulatory agencies. These statements
are also subject to a number of material risks and uncertainties
that are described in Sio’s most recent Annual Report on Form 10-Q
filed with the Securities and Exchange Commission on November 10,
2022, as updated by its subsequent filings with the Securities and
Exchange Commission. Any forward-looking statement speaks only as
of the date on which it was made. Sio undertakes no obligation to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise, except as
required by law.
Contacts:Media, Investors and
Analysts
David W. NassifSio Gene Therapies Inc.Chief Executive Officer,
Chief Financial Officer and General
Counseldavid.nassif@siogtx.com
SIO GENE THERAPIES
INC.Condensed Consolidated Statements of
Operations(Unaudited, in thousands, except share and per
share amounts)
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Operating expenses: |
|
|
|
|
|
|
|
Research and development
expenses |
|
|
|
|
|
|
|
(includes stock-based compensation (benefit) expense of $(8) and
$489 for the three months ended September 30, 2022 and 2021 and
$(409) and $921 for the six months ended September 30, 2022 and
2021, respectively) |
$ |
336 |
|
|
$ |
11,448 |
|
|
$ |
5,878 |
|
|
$ |
19,506 |
|
General and administrative
expenses |
|
|
|
|
|
|
|
(includes stock-based compensation expense of $223 and $6,809 for
the three months ended September 30, 2022 and 2021 and $465 and
$7,698 for the six months ended September 30, 2022 and 2021,
respectively) |
|
2,941 |
|
|
|
9,748 |
|
|
|
5,933 |
|
|
|
13,607 |
|
Total operating expenses |
|
3,277 |
|
|
|
21,196 |
|
|
|
11,811 |
|
|
|
33,113 |
|
Other (income) expenses: |
|
|
|
|
|
|
|
Other (income) expense, net |
|
(197 |
) |
|
|
41 |
|
|
|
(321 |
) |
|
|
22 |
|
Loss before income tax
benefit |
|
(3,080 |
) |
|
|
(21,237 |
) |
|
|
(11,490 |
) |
|
|
(33,135 |
) |
Income tax benefit |
|
— |
|
|
|
— |
|
|
|
(4 |
) |
|
|
(28 |
) |
Net loss |
$ |
(3,080 |
) |
|
$ |
(21,237 |
) |
|
$ |
(11,486 |
) |
|
$ |
(33,107 |
) |
Net loss per share of common
stock — basic and diluted |
$ |
(0.04 |
) |
|
$ |
(0.29 |
) |
|
$ |
(0.16 |
) |
|
$ |
(0.45 |
) |
Weighted-average shares of
common stock outstanding — basic and diluted |
|
73,975,196 |
|
|
|
72,941,507 |
|
|
|
73,870,818 |
|
|
|
72,901,906 |
|
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
SIO GENE THERAPIES
INC.Condensed Consolidated Balance
Sheets(Unaudited, in thousands, except share and per share
amounts)
|
September 30, 2022 |
|
March 31, 2022 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
49,865 |
|
|
$ |
63,729 |
|
Restricted cash |
|
1,184 |
|
|
|
1,184 |
|
Prepaid expenses and other current assets |
|
2,335 |
|
|
|
5,214 |
|
Income tax receivable |
|
355 |
|
|
|
1,609 |
|
Total current assets |
|
53,739 |
|
|
|
71,736 |
|
Operating lease right-of-use
assets |
|
7 |
|
|
|
2,444 |
|
Property and equipment, net |
|
— |
|
|
|
900 |
|
Total assets |
$ |
53,746 |
|
|
$ |
75,080 |
|
Liabilities and
Stockholders’ Equity |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
1,963 |
|
|
$ |
3,984 |
|
Accrued expenses |
|
2,867 |
|
|
|
8,232 |
|
Current portion of operating lease liabilities |
|
4 |
|
|
|
786 |
|
Total current liabilities |
|
4,834 |
|
|
|
13,002 |
|
Operating lease liabilities, net
of current portion |
|
— |
|
|
|
1,730 |
|
Total liabilities |
|
4,834 |
|
|
|
14,732 |
|
Commitments and
contingencies (Note 8) |
|
|
|
Stockholders’ equity: |
|
|
|
Common stock, par value $0.00001 per share, 1,000,000,000 shares
authorized, 73,975,196 and 73,739,378 issued and outstanding at
September 30, 2022 and March 31, 2022, respectively |
|
1 |
|
|
|
1 |
|
Additional paid-in capital |
|
923,022 |
|
|
|
922,966 |
|
Accumulated deficit |
|
(874,442 |
) |
|
|
(862,956 |
) |
Accumulated other comprehensive income |
|
331 |
|
|
|
337 |
|
Total stockholders’ equity |
|
48,912 |
|
|
|
60,348 |
|
Total liabilities and
stockholders’ equity |
$ |
53,746 |
|
|
$ |
75,080 |
|
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
SIO GENE THERAPIES
INC.Condensed Consolidated Statements of Cash
Flows(Unaudited, in thousands)
|
Six Months Ended September 30, |
|
|
2022 |
|
|
|
2021 |
|
Cash flows from operating
activities: |
|
|
|
Net loss |
$ |
(11,486 |
) |
|
$ |
(33,107 |
) |
Adjustments to reconcile net loss
to net cash used in operating activities: |
|
|
|
Non-cash lease expenses |
|
2,437 |
|
|
|
100 |
|
Stock-based compensation expense |
|
56 |
|
|
|
8,619 |
|
Depreciation and non-cash amortization |
|
137 |
|
|
|
122 |
|
Change in operating lease liabilities |
|
(2,512 |
) |
|
|
(109 |
) |
Other |
|
857 |
|
|
|
4 |
|
Changes in operating assets and
liabilities: |
|
|
|
Prepaid expenses and other current assets |
|
2,879 |
|
|
|
3,027 |
|
Income tax receivable |
|
1,254 |
|
|
|
(77 |
) |
Accounts payable |
|
(2,021 |
) |
|
|
1,332 |
|
Accrued expenses |
|
(5,365 |
) |
|
|
(1,830 |
) |
Net cash used in operating activities |
|
(13,764 |
) |
|
|
(21,919 |
) |
Cash flows from investing
activities: |
|
|
|
Cash proceeds from sale of long-term investment |
|
— |
|
|
|
4,343 |
|
Cash proceeds from sale of property and equipment |
|
190 |
|
|
|
— |
|
Purchases of property and equipment |
|
(290 |
) |
|
|
(194 |
) |
Net cash (used in) provided by investing activities |
|
(100 |
) |
|
|
4,149 |
|
Cash flows from financing
activities: |
|
|
|
Cash proceeds from issuance of shares of common stock, net of
issuance costs |
|
— |
|
|
|
479 |
|
Net cash provided by financing activities |
|
— |
|
|
|
479 |
|
Net change in cash and
cash equivalents, restricted cash and long-term restricted
cash |
|
(13,864 |
) |
|
|
(17,291 |
) |
Total cash and cash equivalents,
restricted cash and long-term restricted cash—beginning of
period |
|
64,913 |
|
|
|
120,170 |
|
Total cash and cash equivalents,
restricted cash and long-term restricted cash—end of period |
$ |
51,049 |
|
|
$ |
102,879 |
|
Cash and cash equivalents
—beginning of period |
|
63,729 |
|
|
|
118,986 |
|
Restricted cash included in
current assets—beginning of period |
|
1,184 |
|
|
|
— |
|
Restricted cash included in
long-term assets—beginning of period |
|
— |
|
|
|
1,184 |
|
Total cash and cash equivalents,
restricted cash and long-term restricted cash—beginning of
period |
$ |
64,913 |
|
|
$ |
120,170 |
|
Cash and cash equivalents—end of
period |
|
49,865 |
|
|
|
101,695 |
|
Restricted cash included in
current assets—end of period |
|
1,184 |
|
|
|
1,184 |
|
Total cash and cash equivalents
and restricted cash—end of period |
$ |
51,049 |
|
|
$ |
102,879 |
|
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
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