Israel | 81-3676773 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
Kiryat Atidim, Building 7 | ||
Tel Aviv, Israel 6158002 | ||
(Address of principal executive offices including zip code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
American Depositary Shares, each representing twenty (20) ordinary shares, no par value per share | CMMB | Nasdaq Capital Market |
Ordinary shares, no par value per share | n/a | Nasdaq Capital Market* |
Yes ☒ No ☐ |
Yes ☒ No ☐ |
Large accelerated filer | ☐ | Accelerated filer | ☐ | ||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | ||
Emerging growth company | ☒ |
Yes ☐ No ☒ |
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• | references to “Chemomab Therapeutics Ltd.”, “Chemomab,” the “Company,” “us,” “we” and “our” refer to Chemomab Therapeutics Ltd. an Israeli company and its consolidated subsidiaries, although with respect to the presentation of financial results for historical periods that preceded the Merger (as defined below), these terms refer to the financial results of Chemomab Ltd., which was the accounting acquirer in the Merger; |
• | references to “ordinary shares,” “our shares” and similar expressions refer to the Company’s ordinary shares, no nominal (par) value; |
• | references to “ADS” refer to the American Depositary Shares listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “CMMB,” each representing twenty (20) ordinary shares; |
• | references to “dollars,” “U.S. dollars” and “$” are to U.S. Dollars; |
• | references to “NIS” are to New Israeli Shekels; |
• | references to the “SEC” are to the U.S. Securities and Exchange Commission; and |
• | references to the “Merger” refer to the merger involving Anchiano Therapeutics Ltd. and Chemomab Ltd., whereby a wholly owned subsidiary of Anchiano Therapeutics Ltd. merged with and into Chemomab Ltd., with Chemomab Ltd. surviving as a wholly owned subsidiary of Anchiano Therapeutics Ltd. Upon consummation of the Merger, Anchiano Therapeutics Ltd. changed its name to “Chemomab Therapeutics Ltd.” and the business conducted by Chemomab Ltd. became primarily the business conducted by the Company. |
Chemomab Therapeutics Ltd. and its subsidiaries Condensed Consolidated Interim Financial Statements As of March 31, 2023 (Unaudited) |
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5-6 | |
7 | |
8-9 |
March 31, | December 31, | ||||||||||
Note | 2023 | 2022 | |||||||||
Unaudited | Audited | ||||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | 20,765 | 13,519 | |||||||||
Short term bank deposits | 11,941 | 26,374 | |||||||||
Restricted cash | 77 | 77 | |||||||||
Other receivables and prepaid expenses | 995 | 1,766 | |||||||||
Total current assets | 33,778 | 41,736 | |||||||||
Non-current assets | |||||||||||
Long term prepaid expenses | 690 | 733 | |||||||||
Property and equipment, net | 352 | 367 | |||||||||
Operating lease right-of-use assets | 193 | 227 | |||||||||
Total non-current assets | 1,235 | 1,327 | |||||||||
Total assets | 35,013 | 43,063 | |||||||||
Current liabilities | |||||||||||
Trade payables | 2,217 | 1,688 | |||||||||
Accrued expenses | 3,164 | 3,378 | |||||||||
Employee and related expenses | 1,501 | 1,560 | |||||||||
Operating lease liabilities | 115 | 123 | |||||||||
Total current liabilities | 6,997 | 6,749 | |||||||||
Non-current liabilities | |||||||||||
Operating lease liabilities - long term | 62 | 91 | |||||||||
Total non-current liabilities | 62 | 91 | |||||||||
Commitments and contingent liabilities | |||||||||||
Total liabilities | 7,059 | 6,840 | |||||||||
Shareholders' equity | 1 | ||||||||||
Ordinary shares no par value - Authorized: 650,000,000 shares as of March 31, 2023 and December 31, 2022; | - | - | |||||||||
Issued and outstanding: 232,636,700 Ordinary shares as of March 31, 2023 and December 31, 2022; | - | - | |||||||||
Treasury share at cost (11,640,460 Ordinary shares as of March 31, 2023 and December 31, 2022) | (1,218 | ) | (1,218 | ) | |||||||
Additional paid in capital | 101,744 | 101,260 | |||||||||
Accumulated deficit | (72,572 | ) | (63,819 | ) | |||||||
Total shareholders’ equity | 27,954 | 36,223 | |||||||||
Total liabilities and shareholders’ equity | 35,013 | 43,063 |
Condensed Consolidated Interim Statements of Operations (Unaudited)
Three months | Three months | ||||||||||
Ended | Ended | ||||||||||
March 31, | March 31, | ||||||||||
2023 | 2022 | ||||||||||
Operating expenses | |||||||||||
Research and development | 6,887 | 2,745 | |||||||||
General and administrative | 2,162 | 2,575 | |||||||||
Total operating expenses | 9,049 | 5,320 | |||||||||
Financing income, net | (317 | ) | (216 | ) | |||||||
Loss before taxes | 8,732 | 5,104 | |||||||||
Taxes on income | 21 | - | |||||||||
Net loss for the year | 8,753 | 5,104 | |||||||||
Basic and diluted loss per Ordinary Share (*) | 0.040 | 0.022 | |||||||||
Weighted average number of Ordinary Shares outstanding, basic, and diluted (*) | 220,996,240 | 228,090,300 |
Ordinary Share | Treasury | Additional paid in capital | Accumulated Deficit | Total Shareholders’ equity | ||||||||||||||||||||||||
Number | USD | Number | USD | USD | USD | USD | ||||||||||||||||||||||
For the three-month period ended on March 31, 2023 | ||||||||||||||||||||||||||||
Balance as of January 1, 2023 | 232,636,700 | - | (11,640,460 | ) | (1,218 | ) | 101,260 |
| (63,819 | ) | 36,223 | |||||||||||||||||
Share-based compensation | - | - | - | - | 484 | - | 484 | |||||||||||||||||||||
Net loss for the year | - | - | - | - | - | (8,753 | ) | (8,753 | ) | |||||||||||||||||||
Balance as of March 31, 2023 | 232,636,700 | - | (11,640,460 | ) | (1,218 | ) | 101,744 | (72,572 | ) | 27,954 |
Ordinary Shares | Additional paid in capital | Accumulated Deficit | Total Shareholders’ equity | |||||||||||||||||
Number | USD | USD | USD | USD | ||||||||||||||||
For the three-month period ended on March 31, 2022 | ||||||||||||||||||||
Balance as of January 1, 2022 | 228,090,300 | - | 97,639 | (36,173 | ) | 61,466 | ||||||||||||||
Share-based compensation | - | - | 874 | - | 874 | |||||||||||||||
Net loss for the period | - | - | - | (5,104 | ) | (5,104 | ) | |||||||||||||
Balance as of March 31, 2022 | 228,090,300 | - | 98,513 | (41,277 | ) | 57,236 |
Three months | Three months | |||||||
ended | Ended | |||||||
March 31, | March 31, | |||||||
2023 | 2022 | |||||||
Cash flows from operating activities | ||||||||
Net loss for the period | (8,753 | ) | (5,104 | ) | ||||
Adjustments for operating activities: | ||||||||
Depreciation | 16 | 13 | ||||||
Share-based compensation | 484 | 874 | ||||||
Change in other receivables and prepaid expenses | 814 | (363 | ) | |||||
Change in operating lease liability | (3 | ) | 12 | |||||
Change in trade payables | 529 | 151 | ||||||
Change in accrued expenses | (214 | ) | 693 | |||||
Change in employees and related expenses | (59 | ) | 13 | |||||
1,567 | 1,393 | |||||||
Net cash used in operating activities | (7,186 | ) | (3,711 | ) | ||||
Cash flows from investing activities | ||||||||
Decrease in bank deposits | 14,433 | 2,396 | ||||||
Purchase of property and equipment | (1 | ) | (14 | ) | ||||
Net cash provided by investing activities | 14,432 | 2,382 | ||||||
Cash flows from financing activities | ||||||||
Net cash provided by financing activities | - | - | ||||||
Change in cash, cash equivalents and restricted cash | 7,246 | (1,329 | ) | |||||
Cash, cash equivalents and restricted cash at beginning of period | 13,596 | 15,241 | ||||||
Cash, cash equivalents and restricted cash at end of period | 20,842 | 13,912 |
A. | Chemomab Therapeutics Ltd. (the “Company") is an Israeli-based company incorporated under the laws of the State of Israel in September 2011. The Company’s registered office is located in Kiryat Atidim, Tel Aviv, Israel. The Company is a clinical-stage biotech company discovering and developing innovative therapeutics for conditions with high-unmet medical need that involve inflammation and fibrosis. |
B. | The Company currently has no products approved for sale. The Company’s operations are funded primarily by its Shareholders. The Company has incurred operating losses in each year since its inception and does not expect to generate significant revenue unless and until it obtains marketing approval for its products. Continuation of the Company’s development programs depend on its future ability to raise sources of financing. The Company believes that its existing liquidity resources as of March 31, 2023 will enable it to fund its operations through June 30, 2024 with the ability to perform cost reductions in order to extend the operations even further, if required to do so. | |
C. | On April 30, 2021, the Company entered into an At the Market Offering Agreement (the "ATM Agreement") with Cantor Fitzgerald & Co., ("Cantor"). According to the ATM Agreement, the Company may offer and sell, from time to time, its ADSs having an aggregate offering price of up to $75 million through Cantor or the ATM Agreement. From April 30, 2021, through March 31, 2023 the Company issued 699,806 ADSs at an average price of $22.75 per ADS under the ATM Agreement, resulting in gross proceeds of $15,917 thousand. |
D. | On April 25, 2022, the Company filed a prospectus supplement with the SEC for the issuance and sale of up to $18,125,000 of its ADSs in connection with the reactivation of the ATM Facility and pursuant to General Instruction I.B.6 of Form S-3, which, subject to certain exceptions, limits the amount of securities the Company is able to offer and sell under such registration statement to one-third of our unaffiliated public float. During the year ended December 31, 2022, the Company issued 130,505 ADSs at an average price of $2.11 per ADS under the ATM Agreement, resulting in gross proceeds of $275 thousand.
On March 22, 2023 the Company filed with the SEC an amendment to registration statement on form S-1/A for the issuance and sale of up to $10 million of its ADSs.
Chemomab Therapeutics Inc., a wholly owned subsidiary of the Company, filed an application with the US Internal Revenue Service to carryback net operating losses. The Company received $351 thousand in 2022 and $187 thousand in March 2023. |
8
CHEMOMAB THERAPEUTICS LTD AND ITS SUBSIDIARIES
(FORMERLY ANCHIANO THERAPEUTICS LTD)
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
A. | Basis of Preparation |
B. | Use of estimates |
9
• | CM-101 appeared to be safe when administered subcutaneously. Most reported adverse events observed were mild, with one unrelated serious adverse event reported. No significant injection site reactions were reported and no anti-drug antibodies were detected. |
• | CM-101 administered subcutaneously demonstrated favorable pharmacokinetics and target engagement profiles as expected, and were similar to what the company has previously reported. |
• | CM-101-treated patients showed greater improvements than the placebo group in a number of liver fibrosis-related biomarkers, including ProC-3, ProC-4, ProC-18, TIMP-1 and ELF. |
• | A majority of CM-101-treated patients showed improvements in multiple liver fibrosis-related biomarkers—almost 60% of CM-101 patients were “multiple responders”, responding in at least three biomarkers at week 20, compared to no patients in the placebo group. |
• | CM-101-treated patients with higher CCL24 levels at baseline showed greater reductions in fibrosis-related biomarkers than patients with lower levels of CCL24 at baseline. More CM-101-treated patients with higher CCL24 levels also were “multiple responders”, responding in three or more of the fibrosis-related biomarkers, compared to patients with lower CCL24 levels at baseline. These findings further add to the growing body of evidence validating the role of CCL24 in the pathophysiology of fibrotic liver disease. |
• | A higher proportion of patients in the CM-101-treated group showed improvement in a physiologic measure of liver stiffness as compared to placebo (reduction of at least one grade of fibrosis score as assessed by the non-invasive elastography method known as FibroScan®). |
• | After completion of the study, the unblinded data showed that patients in the CM-101-treated group had higher baseline levels of fibrosis compared to placebo patients. The impact of this difference on the results, if any, is unknown. |
• | expenses incurred under agreements with contract research organizations or contract manufacturing organizations, as well as investigative sites and consultants that conduct our clinical trials, preclinical studies and other scientific development services; |
• | manufacturing scale-up expenses and the cost of acquiring and manufacturing preclinical and clinical trial materials; |
• | employee-related expenses, including salaries, related benefits, travel and share-based compensation expenses for employees engaged in research and development functions, as well as external costs, such as fees paid to outside consultants engaged in such activities; |
• | license maintenance fees and milestone fees incurred in connection with various license agreements; |
• | costs related to compliance with regulatory requirements; and |
• | depreciation and other expenses. |
Three months ended | ||||||||||||||||
March 31, | Increase/(decrease) | |||||||||||||||
2023 | 2022 | $ | % | |||||||||||||
(in thousands) | ||||||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 6,887 | 2,745 | 4,142 | 151 | % | |||||||||||
General and administrative | 2,162 | 2,575 | (413 | ) | (16 | )% | ||||||||||
Operating loss | 9,049 | 5,320 | 3,729 | 70 | % | |||||||||||
Financing income, net | (317 | ) | (216 | ) | (101 | ) | 47 | % | ||||||||
Loss before taxes | 8,732 | 5,104 | 3,628 | 71 | % | |||||||||||
Taxes on income | 21 | - | 21 | 100 | % | |||||||||||
Net loss | $ | 8,753 | $ | 5,104 | $ | 3,649 | 71 | % |
On April 25, 2022, the Company filed a prospectus supplement with the SEC for the issuance and sale of up to $18,125,000 of its ADSs in connection with the reactivation of the ATM Facility and pursuant to General Instruction I.B.6 of Form S-3, which, subject to certain exceptions, limits the amount of securities the Company is able to offer and sell under such registration statement to one-third of our unaffiliated public float. During the year ended December 31, 2022, the Company issued 130,505 ADSs at an average price of $2.11 per ADS under the ATM Agreement, resulting in gross proceeds of $275 thousand.
• | the progress and costs of our preclinical studies, clinical trials and other research and development activities; | |
• | the scope, prioritization and number of our clinical trials and other research and development programs; | |
• | the amount of revenues and contributions we receive under future licensing, development and commercialization arrangements with respect to our product candidates; | |
• | the costs of the development and expansion of our operational infrastructure; | |
• | the costs and timing of obtaining regulatory approval for our product candidates; |
• | the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights; | |
• | the costs and timing of securing manufacturing arrangements for clinical or commercial production; | |
• | the costs of contracting with third parties to provide sales and marketing capabilities for us; | |
• | the costs of acquiring or undertaking development and commercialization efforts for any future products, product candidates or platforms; | |
• | the magnitude of our general and administrative expenses; and | |
• | any cost that we may incur under future in- and out-licensing arrangements relating to our product candidates. |
Three months ended | ||||||||||||||||
March 31, | Change | |||||||||||||||
2023 | 2022 | $ | % | |||||||||||||
(in thousands) | ||||||||||||||||
Net cash used in operating activities | $ | (7,186 | ) | $ | (3,711 | ) | $ | (3,475 | ) | (94 | )% | |||||
Net cash provided by investing activities | $ | 14,432 | $ | 2,382 | $ | 12,050 | 506 | % | ||||||||
Net cash used in financing activities | - | $ | - | $ | - | % | ||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | $ | 7,246 | $ | (1,329 | ) | $ | 8,575 | (645 | )% |
Remainder of 2023 | $ | 6,361 | ||
2024 | 1,676 | |||
2025 | 1,060 | |||
Total | $ | 9,097 |
Exhibit Number | Description | |
32.2** | ||
101. INS | Inline XBRL Instance Document | |
101. SCH | Inline XBRL Taxonomy Extension Schema Document | |
101. CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101. DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
101. LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
101. PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |
* | Filed herewith. | |
** | Furnished herewith. |
CHEMOMAB THERAPEUTICS LTD. | |||
Date: May 11, 2023 | By: | /s/ Dale Pfost | |
Name: | Dale Pfost | ||
Title: | Chief Executive Officer | ||
Date: May 11, 2023 | By: | /s/ Donald Marvin | |
Name: | Donald Marvin | ||
Title: | Chief Financial Officer |
21