UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT UNDER SECTION 1320 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period ended
Commission File Number:
(Exact name of Company as specified in its charter)
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(State or other jurisdiction) |
| (IRS Employer Identification No.) |
of incorporation or organization) |
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(Address of principal executive offices and zip code)
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(Company’s telephone number, including area code)
Indicate by check mark whether the Company (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the Company is a larger accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ |
| Accelerated filer | ☐ |
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| Smaller reporting company | ||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Company is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: |
| Trading Symbol(s) |
| Name of each exchange on which registered: |
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As of February 14, 2023, there were approximately
NanoViricides, Inc.
FORM 10-Q
INDEX
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
NanoViricides, Inc.
Condensed Balance Sheets
| December 31, |
| June 30, | |||
2022 |
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(Unaudited) | ||||||
ASSETS | ||||||
CURRENT ASSETS: |
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Cash and cash equivalents | $ | | $ | | ||
Prepaid expenses | | | ||||
Total current assets |
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Property and equipment, net |
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Trademark and patents, net |
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OTHER ASSETS |
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Service agreements | | | ||||
Security deposits | — | | ||||
Other assets |
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Total assets | $ | | $ | | ||
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES: |
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Accounts payable | $ | | $ | | ||
Accounts payable – related party |
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Loan payable | — | | ||||
Accrued expenses |
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Total current liabilities |
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COMMITMENTS AND CONTINGENCIES |
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STOCKHOLDERS’ EQUITY: |
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Series A convertible preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity | $ | | $ | | ||
See accompanying notes to the condensed financial statements
3
Nanoviricides, Inc.
Condensed Statements of Operations
(Unaudited)
For the Three Months Ended | For the Six Months Ended | |||||||||||
December 31, | December 31, | |||||||||||
| 2022 |
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OPERATING EXPENSES |
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Research and development | $ | | $ | | $ | | $ | | ||||
General and administrative |
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Total operating expenses |
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LOSS FROM OPERATIONS |
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OTHER INCOME (EXPENSE) |
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Interest income |
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Interest expense | ( | ( | ( | ( | ||||||||
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Other (expense) income, net |
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LOSS BEFORE INCOME TAX PROVISION |
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INCOME TAX PROVISION |
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NET LOSS | $ | ( | $ | ( | $ | ( | $ | ( | ||||
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Net loss per common share- basic and diluted | ( | ( | ( | ( | ||||||||
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Weighted average common shares outstanding- basic and diluted |
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See accompanying notes to the condensed financial statements
4
NanoViricides, Inc.
Condensed Statement of Changes in Stockholders’ Equity
For the six months ended December 31, 2022
(Unaudited)
Series A Preferred | Common Stock: | ||||||||||||||||||
Stock: Par $0.001 | Par $0.001 | ||||||||||||||||||
Number | Number | Additional | Total | ||||||||||||||||
of | of | Paid-in | Accumulated | Stockholders’ | |||||||||||||||
| Shares |
| Amount |
| Shares |
| Amount |
| Capital |
| Deficit |
| Equity | ||||||
Balance, June 30, 2022 |
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Series A preferred stock issued for employee stock compensation |
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Common stock issued for consulting and legal services rendered | — | — | | | | — | | ||||||||||||
Warrants issued to Scientific Advisory Board | — | — | — | — | | — | | ||||||||||||
Common stock issued for Directors fees | — | — | | | | — | | ||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||
Balance, September 30, 2022 | | $ | | | $ | | $ | | $ | ( | $ | | |||||||
Series A preferred stock issued for employee stock compensation |
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Common stock issued for consulting and legal services rendered |
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Warrants issued to Scientific Advisory Board | — | — | — | — | | — | | ||||||||||||
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Common stock issued for Directors fees | — | — | | | | — | | ||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||
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Balance, December 31, 2022 |
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5
NanoViricides, Inc.
Condensed Statement of Changes in Stockholders’ Equity
For the six months ended December 31, 2021
(Unaudited)
Series A Preferred | Common Stock: | ||||||||||||||||||
Stock: Par $0.001 | Par $0.001 | ||||||||||||||||||
Number | Number | Additional | Total | ||||||||||||||||
of | of | Paid-in | Accumulated | Stockholders’ | |||||||||||||||
| Shares |
| Amount |
| Shares |
| Amount |
| Capital |
| Deficit |
| Equity | ||||||
Balance, June 30, 2021 |
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Series A preferred stock issued for employee stock compensation |
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Series A preferred stock issued for license agreement | | | — | — | | — | | ||||||||||||
Common stock issued for consulting and legal services rendered |
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Warrants issued to Scientific Advisory Board | — | — | — | — | | — | | ||||||||||||
Common stock issued for Directors fees | — | — | | | | — | | ||||||||||||
Net loss | — | — | — | — | — | ( | ( | ||||||||||||
Balance, September 30, 2021 | | $ | | | $ | | $ | | $ | ( | $ | | |||||||
Series A preferred stock issued for employee stock compensation |
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Common stock issued for consulting and legal services rendered |
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Warrants issued to Scientific Advisory Board |
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Common stock issued for Directors fees |
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Net loss |
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Balance, December 31, 2021 | | $ | | | $ | | $ | | $ | ( | $ | | |||||||
See accompanying notes to the condensed financial statements
6
Nanoviricides, Inc.
Condensed Statements of Cash Flows
(Unaudited)
For the Six Months Ended | ||||||
| December 31, |
| December 31, | |||
2022 | 2021 | |||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net loss | $ | ( | $ | ( | ||
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Adjustments to reconcile net loss to net cash used in operating activities |
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Preferred shares issued as compensation |
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Preferred shares issued pursuant to license agreement | | | ||||
Common shares issued as compensation and for services |
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Warrants granted to Scientific Advisory Board |
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Depreciation |
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Amortization | | | ||||
Changes in operating assets and liabilities: |
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Prepaid expenses |
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Other assets |
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Accounts payable |
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Accounts payable - related party |
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Accrued expenses |
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NET CASH USED IN OPERATING ACTIVITIES |
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CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Purchase of property and equipment | ( | ( | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
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Payment of loan payable | ( | ( | ||||
Deferred financing costs | | ( | ||||
NET CASH (USED IN) FINANCING ACTIVITIES | ( | ( | ||||
NET CHANGE IN CASH AND CASH EQUIVALENTS |
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Cash and cash equivalents at beginning of period |
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Cash and cash equivalents at end of period | $ | | $ | | ||
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION: |
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Interest paid | $ | $ | | |||
See accompanying notes to the condensed financial statements
7
NANOVIRICIDES, INC.
December 31, 2022
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1 – Organization and Nature of Business
NanoViricides, Inc. (the “Company”) is a nano-biopharmaceutical research and development company specializing in the discovery, development, and commercialization of drugs to combat viral infections using its unique and novel nanomedicines technology. NanoViricides possesses its own state of the art facility that supports research and development and drug discovery, drug candidate optimization, cGMP-compliant drug substance manufacturing, cGMP-compliant manufacturing and packaging of drug products for human clinical trials, and early commercialization.
The Company has several drugs in various stages of development. The Company has a lead clinical candidate NV-CoV-2 for the treatment of SARS-CoV-2 infection (COVID-19) that has shown effectiveness and safety in pre-clinical studies. NV-CoV-2 mechanism of action is orthogonal and complementary to that of the existing therapeutics, enabling combination therapy with the existing drugs in the market.
The Company has also initiated additional drug programs for the treatment of Monkeypox (MPOX) virus infection and for the treatment of Enterovirus D68 (EV-D68) pediatric infection, that leverage the development of the clinical stage NV-387 active pharmaceutical ingredient contained in the drug product NV-CoV-2.
The Company has also previously developed a clinical drug candidate, NV-HHV-1 formulated as skin cream, for the treatment of Shingles. The Company plans on taking NV-HHV-1 into human clinical trials, and further develop the HerpeCide™ program after clinical trials of NV-CoV-2. In the HerpeCide program alone, the Company has drug candidates against at least five indications at different stages of development. The Company’s drug candidates against HSV-1 “cold sores” and HSV-2 “genital herpes” are in advanced pre-clinical studies and are expected to follow the shingles drug candidate into human clinical trials. In addition, the Company has drugs in development against all influenzas in our FluCide™ program, as well as drug candidates against HIV/AIDS, Dengue, Ebola/Marburg, and other viruses.
The Company’s drugs are based on several patents, patent applications, provisional patent applications, and other proprietary intellectual property held by TheraCour Pharma, Inc. (“TheraCour”), to which the Company has broad, exclusive licenses. The licenses are to entire fields and not to specific compounds. In all, the Company has exclusive, worldwide licenses for the treatment of the following human viral diseases: Human Immunodeficiency Virus (HIV/AIDS), Hepatitis B Virus (HBV), Hepatitis C Virus (HCV), Herpes Simplex Virus (HSV-1 and HSV-2), Influenza and Asian Bird Flu Virus, Dengue viruses, Ebola/Marburg viruses, Japanese Encephalitis virus, viruses causing viral Conjunctivitis (a disease of the eye) and Ocular Herpes (restated), VZV infections, and SARS-CoV-2 infections. In all cases, the discovery of ligands and polymer materials as well as formulations, the chemistry and chemical characterization, as well as process development and related work will be performed by TheraCour, a related party substantially owned by Dr. Anil Diwan, under the same compensation terms as prior agreements between the parties, with no duplication of costs allowed. Upon commercialization, NanoViricides will pay
The Company’s business plan is based on developing the drug candidates into regulatory approvals, and partnering and sub-licensing for commercialization of the drugs whenever possible.
8
Note 2 - Liquidity
The Company’s condensed financial statements have been prepared assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets and liquidation of liabilities in the normal course of business. As reflected in the condensed financial statements, the Company has an accumulated deficit at December 31, 2022 of approximately $
Since the onset of the COVID-19 pandemic, the Company has focused its efforts primarily on a single lead program to minimize cost outlays, namely, taking the COVID-19 drug candidate against SARS-CoV-2 into human clinical trials. The prior lead program for a shingles drug will follow the COVID-19 drug program.
On July 31, 2020, the Company entered into an At The Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. and Kingswood Capital Markets, a division of Benchmark Investments, Inc. (each a “Sales Agent” and collectively, the “Sales Agents”), pursuant to which the Company may offer and sell, from time to time, through or to the Sales Agents, shares of common stock (the “Placement Shares”), having an aggregate offering price of up to $
The Company believes that it has several important milestones, including Phase 1 clinical trials for the Company’s broad-spectrum, pan-coronavirus drug NV-CoV-2, that should occur in the ensuing year. Management believes that as it achieves these milestones, the Company’s ability to raise additional funds in the public markets would be enhanced.
Management believes that the Company’s existing resources will be sufficient to fund the Company’s planned operations and expenditures for at least 12 months from the date of the filing of this Form 10-Q. However, the Company cannot provide assurance that its plans will not change or that changed circumstances will not result in the depletion of its capital resources more rapidly than it currently anticipates. The Company will need to raise additional capital to fund its long-term operations and research and development plans including human clinical trials for its various drug candidates until it generates revenue which reaches a level sufficient to provide self-sustaining cash flows. The accompanying condensed financial statements do not include any adjustments that may result from the outcome of such unidentified uncertainties.
9
Note 3 - Summary of Significant Accounting Policies
Basis of Presentation – Interim Financial Information
The accompanying unaudited interim condensed financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission for Interim Reporting. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete condensed financial statements. The unaudited interim condensed financial statements furnished reflect all adjustments (consisting of normal recurring accruals) that are, in the opinion of management, considered necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of the results for the full year. The accompanying condensed financial statements and the information included under the heading “Management’s Discussion and Analysis or Plan of Operation” should be read in conjunction with the Company’s audited financial statements and related notes included in the Company’s Form 10-K for the fiscal year ended June 30, 2022 filed with the SEC on October 13, 2022.
The June 30, 2022 year-end balance sheet data in the accompanying interim condensed financial statements was derived from the audited financial statements.
For a summary of significant accounting policies, see the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2022 filed on October 13, 2022.
Net Loss per Common Share
Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through stock options, warrants and convertible preferred stock.
The following table shows the number of potentially outstanding dilutive common shares excluded from the diluted net loss per common share calculation, as they were anti-dilutive:
Potentially Outstanding Dilutive Common Shares | ||||||||
For the | For the | For the | For the | |||||
Three Months | Three Months | Six Months | Six Months | |||||
Ended | Ended | Ended | Ended | |||||
| December 31, 2022 |
| December 31, 2021 | December 31, 2022 |
| December 31, 2021 | ||
Warrants |
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The Company has
10
Note 4 - Related Party Transactions
Related Parties
Related parties with whom the Company had transactions are:
Related Parties |
| Relationship |
Dr. Anil R. Diwan |
| Chairman, President, CEO, significant stockholder and Director |
TheraCour Pharma, Inc. (“TheraCour”) |
| An entity owned and controlled by Dr. Anil R. Diwan |
For the three months ended | For the six months ended | |||||||||||
| December 31, |
| December 31, |
| December 31, |
| December 31, | |||||
2022 | 2021 | 2022 | 2021 | |||||||||
Property and Equipment |
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During the reporting period, TheraCour acquired property and equipment on behalf of the Company from third party vendors and sold such property and equipment, at cost, to the Company | $ | | $ | | $ | | $ | | ||||
As of | ||||||
December 31, | June 30, | |||||
| 2022 |
| 2022 | |||
Account Payable – Related Party | ||||||
Pursuant to an Exclusive License Agreement with TheraCour, the Company was granted exclusive licenses for technologies developed by TheraCour for the virus types: HIV, HCV, Herpes, Asian (bird) flu, Influenza and rabies. On November 1, 2019, the Company entered into the VZV Licensing Agreement with TheraCour. In consideration for obtaining these exclusive licenses, the Company agreed: (1) that TheraCour can charge its costs (direct and indirect) plus no more than | $ | | $ | | ||
For the three months ended | For the six months ended | |||||||||||
December 31, | December 31, | December 31, | December 31, | |||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Research and Development Costs Related Party | ||||||||||||
Development fees and other costs charged by to TheraCour pursuant to the license agreements between TheraCour and the Company for the development of the Company’s drug pipeline. | $ | | $ | | $ | | $ | | ||||
11
License Milestone Fee – Related Party
On September 9, 2021, the Company entered into a COVID-19 License Agreement to use, promote, offer for sale, import, export, sell and distribute drugs that treat COVID-19 infections, using TheraCour’s proprietary as well as patented technology and intellectual property. Pursuant to such license agreement, the Board of Directors authorized the issuance of
Note 5 - Property and Equipment
Property and equipment, stated at cost, less accumulated depreciation consisted of the following:
| December 31, |
| June 30, | |||
2022 | 2022 | |||||
GMP Facility | $ | | $ | | ||
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Land |
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Furniture and Fixtures |
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Lab Equipment |
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Total Property and Equipment |
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Less Accumulated Depreciation |
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Property and Equipment, Net | $ | | $ | | ||
Depreciation expense for the three months ended December 31, 2022 and 2021 was $
Note 6 - Trademark and Patents
Trademark and patents, stated at cost, less accumulated amortization consisted of the following:
| December 31, |
| June 30, | |||
2022 | 2022 | |||||
Trademarks and Patents | $ | | $ | | ||
Less Accumulated Amortization |
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Trademarks and Patents, Net | $ | | $ | | ||
Amortization expense amounted to $
Note 7 – Loan Payable
The Company financed its Directors and Officers liability insurance policies through BankDirect for the periods January 1, 2022 to December 31, 2022 and January 1, 2021 to December 31, 2021. The original loan balances as of January 1, 2022 and January 1, 2021 were $
12
Note 8 - Equity Transactions
On September 14, 2022 the Company’s Board of Directors approved the employment extension of Dr. Anil Diwan, President and Chairman of the Board. On October 6, 2022, the Company and Dr. Anil Diwan executed an extension of his employment agreement for a period of
For the three and six months ended December 31, 2022, the Company’s Board of Directors authorized the issuance of
There is currently no market for the shares of Series A preferred stock and they can only be converted into shares of common stock upon a change of control of the Company as more fully described in the Certificate of Designation. The Company, therefore, estimated the fair value of the Series A preferred stock granted to various employees and others on the date of grant. The conversion of the shares is triggered by a change of control. The fair value of the Series A Convertible preferred stock at each issuance was estimated based upon the price of the Company’s common stock after an application for a reasonable discount for lack of marketability.
The Scientific Advisory Board was granted in August 2022 fully vested warrants to purchase
The Company estimated the fair value of the warrants granted to the Scientific Advisory Board on the date of grant using the with the following assumptions:
Expected life (year) |
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Expected volatility |
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Expected annual rate of quarterly dividends |
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Risk-free rate(s) |
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For the three and six months ended December 31, 2022, the Company’s Board of Directors authorized the issuance of
For the three and six months ended December 31, 2022, the Company’s Board of Directors authorized the issuance of
13
Note 9 - Common Stock Warrants
Weighted | ||||||||||
Average | Weighted | |||||||||
Exercise | Average | |||||||||
Price | Remaining | Aggregate | ||||||||
Number of | per share | Contractual Term | Intrinsic Value | |||||||
Common Stock Warrants |
| Shares |
| ($) |
| (years) |
| ($) | ||
Outstanding and exercisable at June 30, 2022 |
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| $ | | |||
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Granted |
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Expired |
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Outstanding and exercisable at December 31, 2022 |
| | $ | |
| $ | | |||
Of the outstanding warrants at December 31, 2022
Note 10 - Commitments and Contingencies
Legal Proceedings
From time to time, we are subject to various legal proceedings arising in the ordinary course of business, including proceedings for which we have insurance coverage. There are no pending legal proceedings against the Company to the best of the Company’s knowledge as of the date hereof and to the Company’s knowledge no action, suit or proceeding has been threatened against the Company that we believe will have a material adverse effect to our business, financial position, results of operations, or liquidity.
Employment Agreements
On September 14, 2022 the Company’s Board of Directors approved the extension of Dr. Diwan’s employment agreement, and on October 6, 2022, the Company and Dr. Diwan executed an extension of his employment agreement for a period of
License Agreements
The Company is dependent upon its license agreements with TheraCour (See Notes 1 and 4). If the Company lost the right to utilize any of the proprietary information that is the subject of the TheraCour license agreement on which it depends, the Company will incur substantial delays and costs in development of its drug candidates. On November 1, 2019, the Company entered into a VZV License Agreement with TheraCour for an exclusive license for the Company to use, promote, offer for sale, import, export, sell and distribute products for the treatment of VZV derived indications. Process development and related work will be performed by TheraCour under the same compensation terms as prior agreements between the parties, with no duplication of costs allowed.
On September 9, 2021, the Company entered into a COVID-19 License Agreement to use, promote, offer for sale, import, export, sell and distribute drugs that treat COVID-19 infections, using TheraCour’s proprietary as well as patented technology and intellectual property. The discovery of ligands and polymer materials as well as formulations, the chemistry and chemical characterization, as well as process development and related work will be performed by TheraCour under the same compensation terms as prior agreements between the parties, with no duplication of costs allowed.
14
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the information contained in the condensed financial statements of the Company and the notes thereto appearing elsewhere herein and in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in the Company’s Annual Report on Form 10-K for the year ended June 30, 2022. Readers should carefully review the risk factors disclosed in this Form 10-Q, Form 10-K and other documents filed by the Company with the SEC.
As used in this report, the terms “Company”, “we”, “our”, “us” and “NNVC” refer to NanoViricides, Inc., a Nevada corporation.
PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact made in this report are forward looking. In particular, the statements herein regarding industry prospects and future results of operations or financial position are forward-looking statements. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as “anticipate,” “expect,” “intend,” “plan,” “will,” “we believe,” “Company believes,” “management believes” and similar language. These forward-looking statements can be identified by the use of words such as “believes,” “estimates,” “could,” “possibly,” “probably,” “anticipates,” “projects,” “expects,” “may,” “will,” or “should,” or other variations or similar words. No assurances can be given that the future results anticipated by the forward-looking statements will be achieved. Forward-looking statements reflect management’s current expectations and are inherently uncertain. The forward-looking statements are based on the current expectations of NanoViricides, Inc. and are inherently subject to certain risks, uncertainties and assumptions, including those set forth in the discussion under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this report. Actual results may differ materially from results anticipated in these forward-looking statements.
Investors are also advised to refer to the information in our previous filings with the Securities and Exchange Commission (SEC), especially on Forms 10-K, 10-Q and 8-K, in which we discuss in more detail various important factors that could cause actual results to differ from expected or historic results. It is not possible to foresee or identify all such factors. As such, investors should not consider any list of such factors to be an exhaustive statement of all risks and uncertainties or potentially inaccurate assumptions.
Organization and Nature of Business
NanoViricides, Inc. (the “Company,” “we,” or “us”) was incorporated in Nevada on April 1, 2005. Our corporate offices are located at 1 Controls Drive, Shelton, Connecticut 06484 and our telephone number is (203) 937-6137. Our Website is located at http://www.Nanoviricides.com.
Since September 25, 2013, the Company’s common stock trades on the New York Stock Exchange American under the symbol, “NNVC”.
We are a development stage company with several drugs in various stages of pre-clinical development, including IND-filing stage and late stage IND-enabling non-clinical studies. We have no customers, products or revenues to date, and may never achieve revenues or profitable operations.
We have several drugs in our pipeline. Of these, two drugs developed to combat the COVID-19 pandemics, namely NV-CoV-2 and NV-CoV-2-R, are our most advanced drug candidates. We believe that the essential preclinical work including GLP Safety/Toxicology studies has been completed for taking NV-CoV-2 into human clinical trials evaluation. We are working diligently towards the goal of filing an Investigational New Drug Application (IND) for NV-CoV-2 as soon as possible. We are also working towards the goal of starting clinical trials outside of the USA for this drug. We believe that once Phase I clinical trials of NV-CoV-2 are successful, both NV-CoV-2 and NV-CoV-2-R can enter Phase II and further clinical studies. We have successfully made oral formulations of NV-CoV-2 as both (i) NV-CoV-2 Oral “Gummies” and (ii) NV-CoV-2 Oral Syrup. In addition, we have developed the injectable formulation, (iii) NV-CoV-2 for Injection, Infusion or Inhalation. The other drug, NV-CoV-2-R comprises NV-CoV-2 with remdesivir encapsulated in the belly of the polymeric micelles. The clinical program is expected to start with evaluation of the NV-CoV-2 Oral Syrup and NV-CoV-2 Gummies in adults, with extension to pediatric populations upon success. Clinical trials of the
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Injectable Formulation of NV-CoV-2 are expected to follow thereafter. We will report on these objectives via press releases as meaningful advancements take place.
After developing viable drug candidates against COVID-19 in 2020 in a matter of a few months, the Company focused substantially on the COVID-19 drug development, resulting in two drug candidates that are shown to be extremely effective in pre-clinical studies compared to the currently most effective drug, remdesivir, namely NV-CoV-2 and NV-CoV-2-R. Both of these drug candidates have demonstrated pan-coronavirus, broad-spectrum effectiveness. This broad-spectrum effectiveness implies that SARS-CoV-2 variants that are continuously generated in the field are quite unlikely to escape either of these two drug candidates.
In contrast, we note that all of the existing antibodies and cocktails with emergency use approvals, including Evusheld, have lost effectiveness against the current SARS-CoV-2 Omicron variants. Paxlovid has been found to be effective only in adults over 65 years of age with co-morbidities, and its composition further limits its usefulness. Molnupiravir is a known mutagen and its use is not recommended or severely restricted by international health authorities. Remdesivir is the only FDA approved drug for treating COVID-19. It is only approved for hospitalized patients and requires long, daily infusions, and it has shown only marginal improvements, with reduction in hospital stay of a few days. Its effectiveness is limited by its metabolism. We developed NV-CoV-2-R to successfully improve the PK/PD (pharmacokinetics and pharmacodynamics) of remdesivir, thereby developing a highly active drug that is a potential cure, we believe. Additionally existing vaccines including the newest “bivalent” vaccines are now known to be only marginally effective, although they are still expected to reduce potential COVID-19 hospitalizations and deaths in the current winter wave that is known to entail multiple Omicron variants that have already escaped existing antibodies and vaccines.
The pandemic has changed in character from each distinct wave being of a single dominant variant to nearly continuous disease prevalence with multiple circulating variants at the same time. The variants have become progressively more communicable and contagious in time. Although the observed severity of the disease has decreased due to multiple factors including the built up population immunity from prior exposure to the virus variants and vaccinations, SARS-CoV-2 continues to be an important health threat especially because of the incidence of “long COVID”, the syndrome in which nasal swabs do not indicate virus presence but the patients continues to have various disease manifestations. A large percentage of long COVID cases are now known to have circulating SARS-CoV-2 virus present in small quantities. There is no therapeutic available for treating even these long COVID cases with manifest virus presence.
Thus the world is woefully unprepared for a new SARS-CoV-2 wave and forever-arising new variants, except for the fact that natural immunity and prior vaccine-boosted immunity may afford some protection. The therapeutics and preventatives tools available today are generally known to be inadequate, as summarized above. As the populations get “used to” living with the virus, the societal tools of masking, social distancing, and clean hygiene are also falling off due to the encumbrances they pose. The extremely high infectiveness, of the current Omicron variants implies that even these societal tools would have limited effect unlike with the earlier alpha and delta waves of SARS-CoV-2 wherein lockdowns may have averted substantial spread and thus morbidity and mortality.
The need for the broad-spectrum nanoviricide SARS-CoV-2 drug NV-CoV-2 cannot be overstated in the current circumstances and the present status of the pandemic. As new variants emerge, it is now well established that the efficacy of original vaccines continues to drop, and that the resistance to antibodies from these vaccines as well as antibody drugs continues to rise.
Thus there is an urgent need for rapid development of broad-spectrum, pan-coronavirus drugs such as NV-CoV-2 and NV-CoV-2-R, and the Company diligently continues to do the best it can with the limited resources at its disposal to meet this challenge in an expeditious manner. President Biden’s recent statement to end the pandemic emergency declaration on May 11, 2023 does not take away these realities and in cognizance of these, the US FDA has stated that the Emergency Use Approval protocol will continue past this deadline.
NanoViricides is one of a few biopharma companies that has its own cGMP-compliant manufacturing facility. We are manufacturing the clinical supply of drug substances as well as the oral drug products for NV-CoV-2 at our own facility, simplifying and expediting the cGMP-compliant manufacturing operations. We have the capability to produce sufficient drugs for about 1,000 patients in a single batch of production, depending upon dosage. This production capacity is anticipated to be sufficient for Phase I, Phase II and Phase III human clinical trials for our anti-coronavirus drugs in development, as well as for the anticipated clinical trials of NV-HHV-1 skin cream for the treatment of shingles.
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We believe that our platform technology enables development of drugs that viruses would not escape from. In fact, we have successfully screened our COVID-19 drug candidates to be able to protect cells against infection by distinctly different coronaviruses. This broad-spectrum, pan-coronavirus drug development approach was adopted to ensure that our drug candidates should remain effective even as variants of SARS-CoV-2 continue to evolve in the field, just as we had already anticipated at the very beginning of the pandemic.
Additionally, we are the only company that, to the best of our knowledge, is developing antiviral treatments that are designed to (a) directly attack the virus and disable it from infecting human cells, and (b) simultaneously block the reproduction of the virus that has already gone inside a cell. Together, this strategy of a two-pronged attack against the virus, both inside the cell and outside the cell, exemplified by NV-CoV-2-R, can be expected to result in a cure for coronaviruses and other viruses that do not become latent.
This total attack on the whole lifecycle of the virus is expected to result in the most effective drug candidates. It is now well accepted that multiple antivirals together produce better effectiveness than single ones individually. Our strategy goes beyond simply a mix of multiple antivirals. Our unique, shape-shifting nanomedicine technology leads to substantial improvement in the pharmacokinetic properties of the guest antiviral drug. We have shown that encapsulation of remdesivir in NV-CoV-2 protects remdesivir from bodily metabolism in animal studies. This allows higher concentrations of remdesivir to be reached and simultaneously extends the effectiveness time period in comparison to the standard Veklury(R) (Gilead) formulation. The resulting drug, NV-CoV-2-R has not only significantly improved characteristics for its remdesivir component, but additionally provides the novel re-infection blocking mechanism of NV-CoV-2.
The Company’s nanoviricides® platform technology is based on biomimetic engineering that copies the features of the human cellular receptor of the virus. No matter how much the virus mutates, all virus variants bind to the same receptor in the same fashion. It appears that the later variants of SARS-CoV-2 may have evolved to bind to the human cellular receptor ACE2 more strongly, in general, based on published datasets. Thus, if these features of the cellular receptor are appropriately copied, the resulting nanoviricide drug would remain effective against current and future variants of the virus.
Our current drug candidates to combat the COVID-19 pandemic are designed to attack not only SARS-CoV-2 and its current and future variants, but also many other coronaviruses, and will be useful even after the pandemic is over, since several coronaviruses are endemic in human populations. SARS-CoV-2 with its variants and substantial penetration into human populations worldwide is on course to become an endemic virus, if it is not endemic already.
Since completing the IND-enabling safety/toxicology studies, the Company has successfully developed orally active formulations of our drug candidates, in an oral syrup form, as well as an oral gummies (“Chewable Gel”) form. We believe that for mild to moderate cases, for pediatric, and older patients, the oral syrup and gummies forms would be highly advantageous over tablets, capsules, injections, infusions, or lung inhalations. The injectable formulation is expected to be valuable in the treatment of severe cases. Further, this formulation is designed to be deliverable as an aerosol by a simple hand-held device directly into lungs. Such inhalation, as an aerosol is expected to provide greater benefits to more severe patients by providing high concentration of the drug locally in the lungs where the SARS-CoV-2 viruses cause the most damage. We are working with advice from a clinical research organization and external consultants and collaborators on developing the initial human clinical studies plan and application documents. Simultaneously, we are working on putting the various agreements together as necessary. A clinical trial application for evaluation of oral administration of NV-CoV-2, as well as most of the associated agreements have been completed for one of our initiatives outside the USA. We expect to announce the resulting collaborations once the formal steps are completed.
We believe that the extremely strong effectiveness we have observed in cell culture studies and in lethal coronavirus lung infection animal studies, in comparison to remdesivir, should translate into strong effectiveness of our drug candidates NV-CoV-2 and NV-CoV-2-R in human cases of COVID-19 SARS-CoV-2 infection.
We are developing a broad-spectrum antiviral drug candidate, NV-CoV-2, where the potential for escape of virus variants is minimized by the very design of the drug for the treatment of COVID-19 infected sick persons. In contrast, vaccines are not treatments for sick persons, and must be administered to healthy individuals, and further require several weeks for the recipient’s immune system to become capable of protecting against the target virus strain. Variants have readily developed that are capable of infecting vaccinated persons although it is believed that vaccinated persons have a low risk of death from COVID-19 compared to unvaccinated persons.
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