Portage Biotech Inc. (NASDAQ: PRTG) (“Portage” or the “Company”), a
clinical-stage immuno-oncology company advancing novel
multi-targeted therapies for use as monotherapy and in combination,
today reported financial results for the fiscal quarter ended
December 31, 2023.
“The Company is focused on advancing its ADPORT-201 Phase 1a/1b
clinical trial of PORT-6 (adenosine 2A inhibitor) and PORT-7
(adenosine 2B inhibitor) in selected solid tumors. The trial is
progressing well with eight academic center clinical sites
enrolling patients. The Phase 1a dose escalation portion of the
trial has progressed to the third cohort. The Company looks forward
to making a clinical update at the 2024 American Society of
Clinical Oncology (ASCO) Annual Meeting and presenting final data
from the Phase 1a portion of ADPORT-601 (PORT-6) at the 2024
Society for Immunotherapy of Cancer (SITC) Annual Meeting later
this year,” said Dr. Ian Walters, Chief Executive Officer and
Chairman of Portage. “We are excited about future development with
these candidates, including combining our potential best-in-class
adenosine 2A and adenosine 2B inhibitors at the optimum biologic
doses in a biomarker enriched population and collaborating with
Merck to study combinations with KEYTRUDA® (pembrolizumab), Merck’s
anti-PD-1 therapy,” continued Dr. Walters.
Pipeline Updates
- Following the Trial Safety
Committee recommendation, the Company commenced the third dose
escalation cohort for PORT-6 Phase 1a portion of the ADPORT-601
trial.
- After a review of its funding
requirements, the Company’s Board of Directors made the difficult
decision to pause further drug development in the PORT-2 iNKT
program. As a result, the Company will evaluate a range of
potential strategic options which may include, among other things,
finding a partner for the Company’s iNKT program or other
restructuring transaction.
Upcoming Clinical
Milestones
- The Company looks forward to
presenting interim and final data from Phase 1a portion of
ADPORT-601 (PORT-6) at ASCO in June and SITC in November,
respectively.
Financial Results from Quarter Ended December 31,
2023
The Company incurred a net loss of approximately
$39.4 million during the three months ended December 31, 2023 (the
“Fiscal 2024 Quarter”), which includes approximately $44.9 million
of net non-cash expenses, compared to a net loss of approximately
$7.5 million during the three months ended December 31, 2022 (the
“Fiscal 2023 Quarter”), an increase in net loss of $31.9 million,
quarter-over-quarter. The increase in net loss was primarily due to
non-cash losses on impairment relating to the Company’s
identifiable intangible assets attributable to the pausing of its
PORT-2 iNKT program and its investment in Stimunity S.A., as well
as the loss on the Company’s $6.0 million equity offering in
October 2023 (the “Registered Direct Offering”) equal to the excess
of the fair value of certain warrants accounted for as liabilities
issued over the proceeds raised, and offering costs, partially
offset by the decrease in the deferred obligation payable
(principally the iOx milestone) and a net decrease in deferred
income tax liability.
Operating expenses for the Fiscal 2024 Quarter,
which include research and development (“R&D”) costs and
general and administrative (“G&A”) expenses, were $4.0 million
in the Fiscal 2024 Quarter, compared to $4.8 million in the Fiscal
2023 Quarter, a decrease of $0.8 million, which is discussed more
fully below.
R&D costs increased slightly by
approximately $0.1 million, or approximately 1%, from approximately
$2.7 million in the Fiscal 2023 Quarter, to approximately $2.8
million in the Fiscal 2024 Quarter. The increase was primarily
attributable to overall increases in expenditures for the Company’s
clinical activities of $0.2 million, R&D services of $0.2
million and aggregate consulting and licensing fees of $0.3 million
in the Fiscal 2024 Quarter, compared to the Fiscal 2023 Quarter
primarily attributable to an overall increase in clinical trial
costs associated with the clinical trials for PORT-6 and PORT-7
(adenosine assets) and PORT-2 (iNKT) before it was paused. These
increases were substantially offset by reductions in
manufacturing-related costs of $0.4 million and a reduction in
non-cash share-based compensation expense of $0.2 million due to
the vesting of prior year grants and the fact that current stock
options have been granted at a lower fair value.
G&A expenses decreased by approximately $0.7
million, or approximately 35%, from approximately $2.0 million in
the Fiscal 2023 Quarter, to approximately $1.3 million in the
Fiscal 2024 Quarter. Professional fees decreased by $0.3 million
due principally to a decrease in legal fees related to intellectual
property management and costs associated with regulatory filings,
as well as decreases in payroll-related expenses of $0.1 million
and D&O insurance premiums of $0.1 million year-over-year
resulting from changes in the insurance markets and a decrease in
non-cash share-based compensation expense of $0.2 million
attributable to the same factors as the R&D share-based
compensation expense .
The Company’s other pre-tax items of income and
expense were substantially non-cash in nature and aggregated to
approximately $44.9 million net expense in the Fiscal 2024 Quarter,
compared to approximately $0.6 million net expense during the
Fiscal 2023 Quarter. The primary reason for the
quarter-over-quarter difference in other items of income and
expense were the non-cash losses on impairment relating to the
carrying value of in-process research and development (“IPR&D”)
of $46.9 million reflecting the effect of the pause in iNKT
clinical development on the fair value of the related assets along
with the loss on impairment relating to the Company’s investment in
Stimunity S.A. of $0.6 million, as well as $2.4 million reflected
to recognize the loss on the Registered Direct Offering, offering
costs of $0.7 million relating to the Registered Direct Offering
and, finally, $0.4 million commitment fee expense related to the
elapsed period associated with the Company’s committed equity
purchase agreement. These expenses were partially offset by a gain
on the reduction of the deferred obligation (iOx milestone) on
December 31, 2023 of $4.6 million, a gain on the decrease in the
deferred purchase price payable to Tarus of $0.6 million, and a
change in the fair value of warrant liability of $1.0 million at
December 31, 2023.
The Company recognized a non-cash net deferred
income tax benefit of $9.5 million in the Fiscal 2024 Quarter,
compared to a non-cash net deferred income tax expense of $2.2
million in the Fiscal 2023 Quarter, a period-over-period change of
$11.7 million reflecting the reduction of deferred tax liability
associated with the impairment of the IPR&D related to the iNKT
program, partially offset by the derecognition of certain losses
previously recognized. The Fiscal 2023 Quarter reflected the
recognition of current tax losses plus the change (benefit) in
exchange rates on the liability settleable in British pound
sterling and the change (benefit) of the change in income tax rates
in the U.K.
Finally, other comprehensive income (loss) in
the Fiscal 2024 Quarter of $3.0 million unrealized non-cash gain
from the change in the fair value of the Company’s investment in
Intensity Therapeutics, compared to an unrealized non-cash loss of
$4.0 million recognized in the Fiscal 2023 Quarter, a period over
period change of $7.0 million.
As of December 31, 2023, the Company had cash
and cash equivalents of approximately $5.3 million and total
current liabilities of approximately $2.7 million.
About Portage Biotech
Inc.Portage is a clinical-stage immuno-oncology company
advancing multi-targeted therapies to extend survival and
significantly improve the lives of patients with cancer. The
Company is focused on advancing its potentially best-in-class
adenosine antagonists in the ADPORT-601 trial of PORT-6 (adenosine
2A inhibitor) and PORT-7 (adenosine 2B inhibitor). These programs
are being advanced using innovative trial designs and translational
data to identify the patient populations most likely to benefit
from treatment. The Company’s unique business model leverages a
strong network of academic experts and large pharma partners to
rapidly and efficiently advance multiple products. For more
information, please visit www.portagebiotech.com, follow us on
Twitter at @PortageBiotech or find us on LinkedIn at Portage
Biotech Inc.
Forward-Looking Statements This
press release contains forward-looking statements within the
meaning of the United States Private Securities Litigation Reform
Act of 1995. Statements in this press release that are not
statements of historical fact are forward-looking statements. Words
such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,”
“could,” “intend,” “target,” “project,” “estimate,” “believe,”
“predict,” “potential” or “continue” or the negative of these terms
or other similar expressions are intended to identify
forward-looking statements, though not all forward-looking
statements contain these identifying words. Forward-looking
statements in this press release include statements concerning,
among other things, the Company’s plans to evaluate a range of
potential strategic options which may include, among other things,
finding a partner for the Company’s iNKT program or other corporate
transactions. As a result, forward-looking statements are subject
to certain risks and uncertainties, including, but not limited to:
the Company’s plans and ability to develop and commercialize its
product candidates and the timing of its development programs; the
Company’s clinical development of its product candidates, including
the results of current and future clinical trials; the benefits and
risks of the Company’s product candidates as compared to others;
the Company’s maintenance and establishment of intellectual
property rights in its product candidates; the Company’s need for
financing and its estimates regarding its capital requirements and
future revenues and profitability; the Company’s estimates of the
size of the potential markets for its product candidates; the
Company’s selection and licensing of product candidates; and other
factors set forth in “Item 3 - Key Information - Risk Factors” in
the Company’s Annual Report on Form 20-F for the year ended March
31, 2023. Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, undue
reliance should not be placed on them as actual results may differ
materially from these forward-looking statements. The
forward-looking statements contained in this press release are made
as of the date hereof, and the Company undertakes no obligation to
update publicly or revise any forward-looking statements or
information, except as required by law.
FOR MORE INFORMATION, PLEASE CONTACT:
Investor Relations:ir@portagebiotech.com
Media Relations:media@portagebiotech.com
---tables to follow---
Portage Biotech
Inc.Condensed Consolidated Interim Statements of
Operations and Other Comprehensive Income
(Loss)(U.S. Dollars in thousands, except per share
amounts)
|
|
Three Months EndedDecember
31, |
|
|
Nine Months EndedDecember
31, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
$ |
2,771 |
|
|
$ |
2,535 |
|
|
$ |
10,636 |
|
|
$ |
5,976 |
|
General and administrative expenses |
|
|
1,254 |
|
|
|
2,224 |
|
|
|
4,316 |
|
|
|
6,523 |
|
Loss from
operations |
|
|
(4,025 |
) |
|
|
(4,759 |
) |
|
|
(14,952 |
) |
|
|
(12,499 |
) |
Change in fair value of deferred purchase price payable - Tarus and
deferred obligation - iOx milestone |
|
|
5,200 |
|
|
|
(498 |
) |
|
|
3,976 |
|
|
|
(428 |
) |
Loss on Registered Direct Offering |
|
|
(2,432 |
) |
|
|
– |
|
|
|
(2,432 |
) |
|
|
– |
|
Offering costs |
|
|
(662 |
) |
|
|
– |
|
|
|
(662 |
) |
|
|
– |
|
Change in fair value of warrant liability |
|
|
989 |
|
|
|
8 |
|
|
|
989 |
|
|
|
33 |
|
Impairment loss - iOx IPR&D |
|
|
(46,922 |
) |
|
|
– |
|
|
|
(46,922 |
) |
|
|
– |
|
Impairment loss - Stimunity |
|
|
(557 |
) |
|
|
– |
|
|
|
(557 |
) |
|
|
– |
|
Commitment fee under Committed Purchase Agreement |
|
|
(389 |
) |
|
|
– |
|
|
|
(389 |
) |
|
|
– |
|
Share of loss in associate accounted for using equity method |
|
|
(136 |
) |
|
|
(152 |
) |
|
|
(226 |
) |
|
|
(268 |
) |
Depreciation expense |
|
|
(15 |
) |
|
|
(1 |
) |
|
|
(41 |
) |
|
|
(1 |
) |
Foreign exchange transaction gain (loss) |
|
|
8 |
|
|
|
50 |
|
|
|
9 |
|
|
|
(60 |
) |
Interest income |
|
|
75 |
|
|
|
50 |
|
|
|
214 |
|
|
|
115 |
|
Interest expense |
|
|
(9 |
) |
|
|
– |
|
|
|
(25 |
) |
|
|
(9 |
) |
Loss before benefit
(expense) for income taxes |
|
|
(48,875 |
) |
|
|
(5,302 |
) |
|
|
(61,018 |
) |
|
|
(13,117 |
) |
Income tax benefit (expense) |
|
|
9,497 |
|
|
|
(2,199 |
) |
|
|
10,549 |
|
|
|
2,906 |
|
Net loss |
|
|
(39,378 |
) |
|
|
(7,501 |
) |
|
|
(50,469 |
) |
|
|
(10,211 |
) |
Other comprehensive
income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net unrealized gain (loss) on investments |
|
|
2,975 |
|
|
|
(4,017 |
) |
|
|
3,444 |
|
|
|
(4,017 |
) |
Total comprehensive
loss for period |
|
$ |
(36,403 |
) |
|
$ |
(11,518 |
) |
|
$ |
(47,025 |
) |
|
$ |
(14,228 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company |
|
$ |
(39,373 |
) |
|
$ |
(7,485 |
) |
|
$ |
(50,450 |
) |
|
$ |
(10,163 |
) |
Non-controlling interest |
|
|
(5 |
) |
|
|
(16 |
) |
|
|
(19 |
) |
|
|
(48 |
) |
Net loss |
|
$ |
(39,378 |
) |
|
$ |
(7,501 |
) |
|
$ |
(50,469 |
) |
|
$ |
(10,211 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company |
|
$ |
(36,398 |
) |
|
$ |
(11,502 |
) |
|
$ |
(47,006 |
) |
|
$ |
(14,180 |
) |
Non-controlling interest |
|
|
(5 |
) |
|
|
(16 |
) |
|
|
(19 |
) |
|
|
(48 |
) |
Total comprehensive
loss for period |
|
$ |
(36,403 |
) |
|
$ |
(11,518 |
) |
|
$ |
(47,025 |
) |
|
$ |
(14,228 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per
share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
$ |
(1.88 |
) |
|
$ |
(0.44 |
) |
|
$ |
(2.68 |
) |
|
$ |
(0.65 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
20,897 |
|
|
|
17,039 |
|
|
|
18,804 |
|
|
|
15,719 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Portage Biotech Inc.Condensed
Consolidated Interim Statements of Financial
Position(U.S. Dollars in thousands)
|
|
December 31,2023 |
|
|
March 31,2023 |
|
|
|
|
|
|
(Audited) |
|
Assets |
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
5,341 |
|
|
$ |
10,545 |
|
Prepaid expenses and other receivables |
|
|
2,175 |
|
|
|
2,689 |
|
Convertible note receivable |
|
|
– |
|
|
|
442 |
|
Total current
assets |
|
|
7,516 |
|
|
|
13,676 |
|
Non-current
assets |
|
|
|
|
|
|
|
|
Investment in associate |
|
|
452 |
|
|
|
806 |
|
Investment in public company |
|
|
5,544 |
|
|
|
2,087 |
|
In-process research and development |
|
|
34,761 |
|
|
|
81,683 |
|
Deferred commitment fee, net of amortization of $450 and
$61,respectively |
|
|
450 |
|
|
|
839 |
|
Right to use asset |
|
|
263 |
|
|
|
– |
|
Other assets, including equipment, net |
|
|
49 |
|
|
|
38 |
|
Total non-current
assets |
|
|
41,519 |
|
|
|
85,453 |
|
Total
assets |
|
$ |
49,035 |
|
|
$ |
99,129 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
Equity |
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
2,658 |
|
|
$ |
1,865 |
|
Lease liability - current, including interest |
|
|
50 |
|
|
|
– |
|
Total current
liabilities |
|
|
2,708 |
|
|
|
1,865 |
|
Non-current
liabilities |
|
|
|
|
|
|
|
|
Lease liability - non-current |
|
|
225 |
|
|
|
– |
|
Warrant liabilities |
|
|
7,443 |
|
|
|
– |
|
Deferred tax liability |
|
|
– |
|
|
|
10,564 |
|
Deferred purchase price payable - Tarus |
|
|
7,329 |
|
|
|
7,179 |
|
Deferred obligation - iOx milestone |
|
|
– |
|
|
|
4,126 |
|
Total non-current
liabilities |
|
|
14,997 |
|
|
|
21,869 |
|
Total
liabilities |
|
|
17,705 |
|
|
|
23,734 |
|
|
|
|
|
|
|
|
|
|
Shareholders’
Equity |
|
|
|
|
|
|
|
|
Capital stock |
|
|
219,494 |
|
|
|
218,782 |
|
Stock option reserve |
|
|
23,452 |
|
|
|
21,204 |
|
Accumulated other comprehensive loss |
|
|
(881 |
) |
|
|
(4,325 |
) |
Accumulated deficit |
|
|
(210,066 |
) |
|
|
(159,616 |
) |
Total equity
attributable to owners of the Company |
|
|
31,999 |
|
|
|
76,045 |
|
Non-controlling
interest |
|
|
(669 |
) |
|
|
(650 |
) |
Total
equity |
|
|
31,330 |
|
|
|
75,395 |
|
Total liabilities and
equity |
|
$ |
49,035 |
|
|
$ |
99,129 |
|
Commitments and
Contingent Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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