Palisade Bio (Nasdaq: PALI), a clinical stage
biopharmaceutical company advancing therapies for acute and chronic
gastrointestinal (GI) complications, today reported its financial
results for the quarter ended March 31, 2022.
Additionally, the Company provided a clinical
program update for its lead asset in development, LB1148, an oral
formulation of a broad-spectrum serine protease inhibitor designed
to neutralize the activity of potent digestive proteases released
from the gut during surgery.
Recent Highlights
- Extended cash runway with a $2.0
million registered direct offering.
- Received National Medical Products
Administration (NMPA) clearance to commence Phase 3 clinical trial
in China evaluating LB1148 to accelerate the return of bowel
function following abdominal surgery.
- Received “Study May Proceed” letter
from the U.S. Food and Drug Administration (FDA) for Phase 3
clinical trial evaluating LB1148 to accelerate the return of bowel
function following abdominal surgery.
- Presented data from a
pooled-analysis of studies LBS-IST-POI-101 and LBS-POI-201-CN
(PROFILE-CN) demonstrating LB1148 reduced the extent and severity
of post-surgical intraabdominal adhesions by 93% at the Society of
American Gastrointestinal and Endoscopic Surgeons (SAGES) 2022
Annual Meeting.
- Appointed Robert McRae as Senior
Vice President, Operations and Strategic Development.
“We have made exciting progress on the
operational, clinical, and regulatory fronts over the course of the
past quarter and are poised to execute on our near-term milestones.
With the clearance from the FDA, as well as the NMPA, to proceed
with our Phase 3 program in the United States and China, our team
is laser focused on driving LB1148 forward as quickly and
efficiently as possible. Additionally, we made progress on the
financial front by bolstering our cash position with the completed
financing,” commented Tom Hallam, Ph.D., Chief Executive Officer of
Palisade Bio. “This will position us to take an important step
closer to the registration and commercialization of LB1148, which
we believe has the potential to establish the standard of care,
globally. The leadership team and board are focused on building on
our momentum with our pipeline and look forward to unlocking value
for all stakeholders of Palisade Bio.”
Clinical Program Update
LB1148 is a novel oral liquid formulation of the
well-characterized digestive enzyme inhibitor, tranexamic acid
(“TXA”), with potential to both reduce abdominal adhesions and help
restore bowel function following surgery. The therapy is being
developed for administration prior to surgeries that are at risk of
disrupting the intestinal epithelial barrier. Evidence suggests
that the release of digestive proteases contributes to the
temporary loss of normal gastrointestinal function and the
formation of postoperative adhesions. By inhibiting the activity of
these digestive proteases, LB1148 has the potential to prevent
damage to GI tissues, accelerate the time to the return of normal
GI function, and shorten the duration of costly post-surgery
hospital stays.
Postoperative Return of Bowel Function: GI
Surgery
In March 2022, the Company received a “Study May
Proceed” letter from the FDA to initiate its Phase 3 clinical trial
evaluating LB1148 to accelerate the return of bowel function in
adult patients undergoing gastrointestinal surgery. The trial is
designed as a multi-centered, randomized, double-blinded,
parallel-group, placebo-controlled clinical trial set to enroll
approximately 600 patients, and will assess the safety and efficacy
of LB1148. All patients enrolled in the trial will undergo a
scheduled bowel resection surgery that will include either
laparotomy or laparoscopic surgical approaches.
Additionally, in May 2022 the Company’s
co-development partner Newsoara Biopharma Co. Ltd, received
clearance from the NMPA in China to proceed with their Phase 3
clinical trial to evaluate LB1148 for accelerated return of bowel
function in adult patients undergoing gastrointestinal surgery.
The expected timelines are management’s current
forecasts and will be updated as enrollment progresses.
Expected Upcoming Milestones
- Q2 2022: U.S. Phase 3 study
initiation
- 2H 2022: U.S. Phase 3 study first
patient enrolled
Prevention of Post-Surgical Abdominal Adhesions:
GI Surgery
Digestive enzymes can escape the intestine
during abdominal surgery and cause damage to the intestines and
surrounding organs resulting in the formation of scar tissue known
as adhesions. Adhesion prevalence has historically reported to be
>90% in patients who undergo abdominal surgery and represents a
potentially significant contribution to serious complications.
Adhesions can be the cause of chronic pain and may prevent normal
organ function, including bowel obstructions of the intestine.
Adhesions can increase the difficulty of subsequent surgeries
causing complications and are the leading cause of secondary
infertility in women. In some cases, adhesions require a second
corrective surgical procedure. There are currently no approved
medications to prevent or treat adhesions.
The Company previously reported data on three
patients who had been assessed for adhesions following GI surgery.
In the Company’s recent data presentation at the Society of
American Gastrointestinal and Endoscopic Surgeons (SAGES) 2022
Annual Meeting, a pooled-study analysis of 17 patients demonstrated
LB1148 reduced incidence of adhesions by 72% and reduced the extent
and severity of adhesions by 93% in patients undergoing bowel
resection.
The Company is conducting an ongoing randomized,
double-blind, placebo-controlled, parallel-group, multicenter Phase
2 clinical trial of LB1148 in up to 200 patients undergoing
elective bowel resection surgery in the United States. This trial
is designed to evaluate whether patients treated with LB1148
experience fewer postoperative intra-abdominal adhesions. The trial
will also assess LB1148’s impact on recovery of GI function, as
compared to placebo.
Expected Upcoming Milestones
- Q4 2022: Phase 2 enrollment
completion
- 1H 2023: Phase 2 study
completion
- 2H 2023: Report Phase 2 topline
results
Postoperative Return of Bowel Function:
Cardiovascular Surgery
The Company previously announced positive
topline data from its Phase 2 trial demonstrating LB1148 achieved
its primary endpoint with statistically significant improvement in
return of bowel function following cardiovascular (CV) surgery. The
Phase 2 clinical trial was a randomized, double-blind, parallel,
placebo-controlled trial in 120 subjects undergoing coronary artery
bypass grafting (CABG) and/or heart valve replacement surgery
requiring cardiopulmonary bypass (CPB) with patients randomized to
receive LB1148 or placebo in conjunction with surgery. LB1148
provided a 30% improvement in the time to normal bowel function
following cardiovascular surgery (p<0.001) compared to placebo.
This improvement resulted in a 1.1-day reduction in average length
of stay in the ICU and a 1.0-day reduction in average hospital
length of stay. LB1148 was also shown to be safe and well-tolerated
in the trial. The Company plans to initiate additional CV surgery
studies with LB1148 after the completion of the studies to
accelerate the return of bowel function in patients undergoing
gastrointestinal surgery.
The U.S. FDA has granted Fast Track designation
to LB1148 for two clinical indications: reduction of adhesions
following abdominal or pelvic surgery and treatment of
postoperative GI dysfunction in pediatric patients undergoing
cardiac surgery.
Summary of Financial Results for First Quarter
2022
Net loss was $4.2 million and $4.0 million for
the three months ended March 31, 2022, and 2021,
respectively.Research and development expenses were $1.0 million
and $0.7 million for the three months ended March 31, 2022, and
2021, respectively. The increase of approximately $0.3 million, or
39%, was primarily attributable to the Company's increased clinical
trial activities. In the quarter, the Company's clinical trial
activities, which had been virtually halted in the first quarter of
2021 due to the COVD-19 pandemic, continued to increase as the
Company proceeded with its Phase 2 trial of the prevention of
post-surgical abdominal adhesions and advanced towards its Phase 3
postoperative return of bowel function trial for which a protocol
has been agreed to with the FDA. The Company expects research and
development expenses to continue to increase in 2022 as it executes
on its clinical development plan for LB1148. General and
administrative expenses for the three months ended March 31, 2022,
increased approximately $1.7 million or 132%, from $1.3 million for
three months ended March 31, 2021, to $2.9 million. The increase,
as compared to the first quarter of 2021, was primarily related to
higher general and administrative expenses associated with
operating as a public company, as compared to those of the
Company’s accounting predecessor, Leading Biosciences, Inc.
Although difficult to predict, the Company expects general and
administrative expenses will be lower in the remaining quarters of
2022. As of March 31, 2022, the Company had cash and cash
equivalents of $6.6 million. Subsequent to quarter end, the Company
closed on a $2.0 million registered direct offering of 3,646,690
shares of its common stock at a purchase price of $0.55 per share.
The Company also agreed to issue to the investors in a concurrent
private placement, unregistered warrants to purchase up to an
aggregate of 3,646,690 shares of its common stock. The warrants
have an exercise price of $0.7105 per share of common stock, will
be exercisable six months after the date of issuance, and will
expire five and a half years following the initial issuance date.
The Company intends to use the net proceeds from the financing for
working capital and general corporate purposes, including the
development of the Company’s lead product candidate LB1148.
About Palisade
Bio Palisade Bio is a clinical stage
biopharmaceutical company advancing therapies that aim to aid
patients suffering with acute and chronic gastrointestinal
complications stemming from post-operative digestive enzyme damage.
Palisade Bio’s innovative lead asset LB1148, advancing toward Phase
3, is a protease inhibitor with the potential to both reduce
abdominal adhesions and help restore bowel function following
surgery. Positive data from Phase 2 trials of LB1148 demonstrated
safety and tolerability as well as a statistically significant
improvement in the return of bowel function and a decrease in the
length of stay in ICU and hospital compared to placebo. Palisade
Bio believes that its investigational therapies have the potential
to address the myriad health conditions and complications
associated with the chronic disruption to the gastrointestinal
epithelial barrier. For more information, please go
to www.palisadebio.com.
Forward Looking StatementsThis
communication contains “forward-looking” statements for purposes of
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include statements
regarding Palisade’s intentions, beliefs, projections, outlook,
analyses or current expectations concerning, among other things:
the expected commencement date for a Phase 3 study, expected
near-term Phase 2 milestones, the use of proceeds from the
financing, expectations regarding regulatory submissions, the
potential for LB1148 to transform the current standard of care, if
approved, and the ability for the Company to unlock value for our
stakeholders. Any statements contained in this communication that
are not statements of historical fact may be deemed to be
forward-looking statements. These forward-looking statements are
based upon Palisade’s current expectations. Forward-looking
statements involve risks and uncertainties. Palisade’s actual
results and the timing of events could differ materially from those
anticipated in such forward-looking statements as a result of these
risks and uncertainties, which include, without limitation, the
Company’s ability to advance its clinical programs, the uncertain
and time-consuming regulatory approval process, and the Company's
ability to achieve additional financing to fund future operations
and to comply with the continued listing requirements of the
applicable stock exchange. Additional risks and uncertainties can
be found in Palisade Bio’s Quarterly Report on Form 10-Q for the
quarter ended March 31, 2022. Palisade expressly
disclaims any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statements contained
herein to reflect any change in Palisade’s expectations with regard
thereto or any change in events, conditions or circumstances on
which any such statements are based.
Palisade Bio Investor Relations Contact:Dawn
Hofmeisterir@palisadebio.com
Investor Relations ContactJTC Team, LLCJenene
Thomas 833-475-8247PALI@jtcir.com
Palisade Bio,
Inc.Condensed Consolidated Balance
Sheets(in thousands, except share and per share
amounts)
|
|
March 31, |
|
December 31, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
6,644 |
|
|
$ |
10,495 |
|
Prepaid expenses and other current assets |
|
|
1,614 |
|
|
|
1,879 |
|
Total current assets |
|
|
8,258 |
|
|
|
12,374 |
|
Restricted cash |
|
|
26 |
|
|
|
26 |
|
Right-of-use asset |
|
|
64 |
|
|
|
109 |
|
Property and equipment, net |
|
|
2 |
|
|
|
3 |
|
Total assets |
|
$ |
8,350 |
|
|
$ |
12,512 |
|
|
|
|
|
|
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS'
EQUITY |
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
1,147 |
|
|
$ |
1,323 |
|
Accrued liabilities |
|
|
580 |
|
|
|
463 |
|
Accrued compensation and benefits |
|
|
72 |
|
|
|
511 |
|
Current portion of lease liability |
|
|
65 |
|
|
|
112 |
|
Current portion of debt |
|
|
— |
|
|
|
87 |
|
Total current liabilities |
|
|
1,864 |
|
|
|
2,496 |
|
Warrant liability |
|
|
1,694 |
|
|
|
2,651 |
|
Total liabilities |
|
|
3,558 |
|
|
|
5,147 |
|
Commitments and contingencies (Note 9) |
|
|
|
|
Stockholders' equity: |
|
|
|
|
Series A Convertible Preferred Stock, 7,000,000 shares authorized,
$0.01 par value; 200,000 issued and outstanding at March 31,
2022 and December 31, 2021 |
|
|
2 |
|
|
|
2 |
|
Common stock, $0.01 par value; 300,000,000 shares authorized as of
March 31, 2022 and December 31, 2021, respectively;
18,233,479 and 14,239,177 shares issued and outstanding at
March 31, 2022 and December 31, 2021 |
|
|
183 |
|
|
|
143 |
|
Additional paid-in capital |
|
|
103,454 |
|
|
|
101,862 |
|
Accumulated deficit |
|
|
(98,847 |
) |
|
|
(94,642 |
) |
Total stockholders' equity |
|
|
4,792 |
|
|
|
7,365 |
|
Total liabilities and stockholders' equity |
|
$ |
8,350 |
|
|
$ |
12,512 |
|
|
|
|
|
|
Palisade Bio,
Inc.Condensed Consolidated Statements of
Operations(in thousands, except share and per share
amounts)(Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2022 |
|
|
|
2021 |
|
Operating expenses: |
|
|
|
|
Research and development |
|
$ |
959 |
|
|
$ |
692 |
|
General and administrative |
|
|
2,929 |
|
|
|
1,262 |
|
Total operating expenses |
|
|
3,888 |
|
|
|
1,954 |
|
Loss from operations |
|
|
(3,888 |
) |
|
|
(1,954 |
) |
Other income (expense): |
|
|
|
|
Gain on forgiveness of PPP loan |
|
|
— |
|
|
|
279 |
|
Loss on issuance of secured debt |
|
|
— |
|
|
|
(686 |
) |
Gain on change in fair value of warrant liability |
|
|
793 |
|
|
|
42 |
|
Interest expense |
|
|
(1 |
) |
|
|
(1,711 |
) |
Other income |
|
|
1 |
|
|
|
— |
|
Loss on issuance of warrants |
|
|
(1,110 |
) |
|
|
— |
|
Total other expense |
|
|
(317 |
) |
|
|
(2,076 |
) |
Net loss |
|
$ |
(4,205 |
) |
|
$ |
(4,030 |
) |
|
|
|
|
|
Basic and diluted loss per common share |
|
$ |
(0.26 |
) |
|
$ |
(1.45 |
) |
Weighted average shares used in computing basic and diluted loss
per common share |
|
|
16,223,656 |
|
|
|
2,774,502 |
|
|
|
|
|
|
Palisade Bio,
Inc.Condensed Consolidated Statements of Cash
Flows (in thousands)
|
|
Three Months Ended March 31, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
Net loss |
|
$ |
(4,205 |
) |
|
$ |
(4,030 |
) |
Adjustments to reconcile net loss to net cash used in
operating activities: |
|
|
|
|
Depreciation and amortization |
|
|
1 |
|
|
|
1 |
|
Noncash lease expense |
|
|
45 |
|
|
|
39 |
|
Gain on forgiveness of PPP loan |
|
|
— |
|
|
|
(279 |
) |
Accretion of debt discount and non-cash interest expense |
|
|
— |
|
|
|
1,590 |
|
Loss on issuance of secured debt |
|
|
— |
|
|
|
686 |
|
Loss on issuance of warrants |
|
|
1,110 |
|
|
|
— |
|
Change in fair value of warrant liabilities |
|
|
(793 |
) |
|
|
(42 |
) |
Stock-based compensation |
|
|
358 |
|
|
|
569 |
|
Changes in operating assets and liabilities: |
|
|
|
|
Trade and other receivables |
|
|
— |
|
|
|
59 |
|
Prepaid and other assets |
|
|
265 |
|
|
|
21 |
|
Accounts payable and accrued liabilities |
|
|
(59 |
) |
|
|
183 |
|
Accrued compensation |
|
|
(439 |
) |
|
|
(8 |
) |
Operating lease liabilities |
|
|
(47 |
) |
|
|
(39 |
) |
Net cash used in operating activities |
|
|
(3,764 |
) |
|
|
(1,250 |
) |
Cash flows from financing activities: |
|
|
|
|
Payments on debt |
|
|
(87 |
) |
|
|
(11 |
) |
Proceeds from issuance of debt |
|
|
— |
|
|
|
1,250 |
|
Payment of debt issuance costs |
|
|
— |
|
|
|
(87 |
) |
Net cash (used in) provided by financing activities |
|
|
(87 |
) |
|
|
1,152 |
|
Net decrease in cash, cash equivalents and restricted cash |
|
|
(3,851 |
) |
|
|
(98 |
) |
Cash, cash equivalents and restricted cash, beginning of
period |
|
|
10,521 |
|
|
|
739 |
|
Cash, cash equivalents and restricted cash, end of period |
|
$ |
6,670 |
|
|
$ |
641 |
|
|
|
|
|
|
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