Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 04, 2022 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-37937 | |
Entity Registrant Name | XENETIC BIOSCIENCES, INC. | |
Entity Central Index Key | 0001534525 | |
Entity Tax Identification Number | 45-2952962 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 945 Concord Street | |
Entity Address, City or Town | Framingham | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01701 | |
City Area Code | 781 | |
Local Phone Number | 778-7720 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,166,596 | |
Common Stock, $0.001 par value per share [Member] | ||
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | XBIO | |
Security Exchange Name | NASDAQ | |
Purchase Warrants [Member] | ||
Title of 12(b) Security | Purchase Warrants | |
Trading Symbol | XBIOW | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 13,848,172 | $ 18,244,030 |
Prepaid expenses and other | 319,103 | 479,399 |
Total current assets | 14,167,275 | 18,723,429 |
Other assets | 1,405,851 | 1,091,931 |
Total assets | 15,573,126 | 19,815,360 |
Current liabilities: | ||
Accounts payable | 202,778 | 362,470 |
Accrued expenses and other current liabilities | 848,080 | 1,058,633 |
Total current liabilities | 1,050,858 | 1,421,103 |
Total liabilities | 1,050,858 | 1,421,103 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Common stock, $0.001 par value; 50,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 14,343,587 and 13,466,603 shares issued as of September 30, 2022 and December 31, 2021, respectively; 14,316,596 and 13,439,612 shares outstanding as of September 30, 2022 and December 31, 2021, respectively | 14,342 | 13,465 |
Additional paid in capital | 207,149,681 | 205,952,729 |
Accumulated deficit | (187,617,083) | (182,547,265) |
Accumulated other comprehensive income | 253,734 | 253,734 |
Treasury stock | (5,281,180) | (5,281,180) |
Total stockholders' equity | 14,522,268 | 18,394,257 |
Total liabilities and stockholders' equity | 15,573,126 | 19,815,360 |
Series B Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred Stock, Value, Issued | 1,804 | 1,804 |
Series A Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred Stock, Value, Issued | $ 970 | $ 970 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 14,343,587 | 13,466,603 |
Common stock, shares outstanding | 14,316,596 | 13,439,612 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock shares issued | 1,804,394 | 1,804,394 |
Preferred stock, shares outstanding | 1,804,394 | 1,804,394 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock shares issued | 970,000 | 970,000 |
Preferred stock, shares outstanding | 970,000 | 970,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue: | ||||
Royalty revenue | $ 414,250 | $ 349,269 | $ 1,219,953 | $ 828,088 |
Total revenue | 414,250 | 349,269 | 1,219,953 | 828,088 |
Operating costs and expenses: | ||||
Research and development | (398,803) | (780,153) | (3,577,701) | (1,934,432) |
General and administrative | (863,233) | (945,115) | (2,796,832) | (2,766,397) |
Total operating costs and expenses | (1,262,036) | (1,725,268) | (6,374,533) | (4,700,829) |
Loss from operations | (847,786) | (1,375,999) | (5,154,580) | (3,872,741) |
Other income (expense): | ||||
Other expense | (1,706) | (2,906) | (2,583) | (1,784) |
Interest income, net | 45,475 | 28,029 | 87,345 | 71,026 |
Total other income | 43,769 | 25,123 | 84,762 | 69,242 |
Net loss | $ (804,017) | $ (1,350,876) | $ (5,069,818) | $ (3,803,499) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Earnings Per Share, Basic | $ (0.06) | $ (0.13) | $ (0.36) | $ (0.41) |
Earnings Per Share, Diluted | $ (0.06) | $ (0.13) | $ (0.36) | $ (0.41) |
Weighted Average Number of Shares Outstanding, Basic | 14,316,596 | 10,162,167 | 13,944,286 | 9,223,560 |
Weighted Average Number of Shares Outstanding, Diluted | 14,316,596 | 10,162,167 | 13,944,286 | 9,223,560 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Treasury Stock [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 2,774 | $ 8,771 | $ 194,133,511 | $ (176,902,086) | $ 253,734 | $ (5,281,180) | $ 12,215,524 |
Beginning balance, shares at Dec. 31, 2020 | 2,774,394 | 8,772,198 | |||||
Issuance of common stock and warrants, net of issuance costs | $ 950 | 11,449,916 | 11,450,866 | ||||
Issuance of common stock and warrants, net of issuance costs, shares | 950,000 | ||||||
Exercise of pre-funded warrants | $ 3,679 | 3,679 | |||||
Exercise of pre-funded warrants, shares | 3,679,630 | ||||||
Share-based expense | 297,337 | 297,337 | |||||
Exercise of purchase warrants | $ 4 | (4) | |||||
Exercise of purchase warrants, shares | 4,032 | ||||||
Issuance of common stock to vendor | $ 7 | (7) | |||||
Issuance of common stock to vendor, shares | 7,153 | ||||||
Net loss | (3,803,499) | (3,803,499) | |||||
Ending balance, value at Sep. 30, 2021 | $ 2,774 | $ 13,411 | 205,880,753 | (180,705,585) | 253,734 | (5,281,180) | 20,163,907 |
Ending balance, shares at Sep. 30, 2021 | 2,774,394 | 13,413,013 | |||||
Beginning balance, value at Jun. 30, 2021 | $ 2,774 | $ 8,772 | 194,319,716 | (179,354,709) | 253,734 | (5,281,180) | 9,949,107 |
Beginning balance, shares at Jun. 30, 2021 | 2,774,394 | 8,773,683 | |||||
Issuance of common stock and warrants, net of issuance costs | $ 950 | 11,449,916 | 11,450,866 | ||||
Issuance of common stock and warrants, net of issuance costs, shares | 950,000 | ||||||
Exercise of pre-funded warrants | $ 3,679 | 3,679 | |||||
Exercise of pre-funded warrants, shares | 3,679,630 | ||||||
Share-based expense | 111,131 | 111,131 | |||||
Exercise of purchase warrants | $ 3 | (3) | |||||
Exercise of purchase warrants, shares | 2,547 | ||||||
Issuance of common stock to vendor | $ 7 | (7) | |||||
Issuance of common stock to vendor, shares | 7,153 | ||||||
Net loss | (1,350,876) | (1,350,876) | |||||
Ending balance, value at Sep. 30, 2021 | $ 2,774 | $ 13,411 | 205,880,753 | (180,705,585) | 253,734 | (5,281,180) | 20,163,907 |
Ending balance, shares at Sep. 30, 2021 | 2,774,394 | 13,413,013 | |||||
Beginning balance, value at Dec. 31, 2021 | $ 2,774 | $ 13,465 | 205,952,729 | (182,547,265) | 253,734 | (5,281,180) | 18,394,257 |
Beginning balance, shares at Dec. 31, 2021 | 2,774,394 | 13,466,603 | |||||
Issuance of common stock in connection with purchase of in-process research and development | $ 875 | 804,125 | 805,000 | ||||
Issuance of common stock in connection with purchase of in-process research and development, shares | 875,000 | ||||||
Share-based expense | 392,829 | 392,829 | |||||
Exercise of purchase warrants | $ 2 | (2) | |||||
Exercise of purchase warrants, shares | 1,984 | ||||||
Net loss | (5,069,818) | (5,069,818) | |||||
Ending balance, value at Sep. 30, 2022 | $ 2,774 | $ 14,342 | 207,149,681 | (187,617,083) | 253,734 | (5,281,180) | 14,522,268 |
Ending balance, shares at Sep. 30, 2022 | 2,774,394 | 14,343,587 | |||||
Beginning balance, value at Jun. 30, 2022 | $ 2,774 | $ 14,342 | 207,012,317 | (186,813,066) | 253,734 | (5,281,180) | 15,188,921 |
Beginning balance, shares at Jun. 30, 2022 | 2,774,394 | 14,343,587 | |||||
Share-based expense | 137,364 | 137,364 | |||||
Net loss | (804,017) | (804,017) | |||||
Ending balance, value at Sep. 30, 2022 | $ 2,774 | $ 14,342 | $ 207,149,681 | $ (187,617,083) | $ 253,734 | $ (5,281,180) | $ 14,522,268 |
Ending balance, shares at Sep. 30, 2022 | 2,774,394 | 14,343,587 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (5,069,818) | $ (3,803,499) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Acquired in-process research and development | 1,305,000 | 0 |
Amortization of right of use asset | 27,043 | 26,199 |
Share-based expense | 392,829 | 297,337 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other | 133,253 | (62,484) |
Other long-term assets | (313,920) | 105,555 |
Accounts payable, accrued expenses and other liabilities | (370,245) | 157,524 |
Net cash used in operating activities | (3,895,858) | (3,279,368) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net cash paid to acquire in-process research and development | (500,000) | 0 |
Net cash used in investing activities | (500,000) | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common stock and warrants | 0 | 11,450,866 |
Proceeds from exercise of warrants | 0 | 3,679 |
Net cash provided by financing activities | 0 | 11,454,545 |
Net change in cash | (4,395,858) | 8,175,177 |
Cash at beginning of period | 18,244,030 | 11,527,552 |
Cash at end of period | 13,848,172 | 19,702,729 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | 0 | 0 |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Issuance of common stock to acquire in-process research and development | 805,000 | 0 |
Issuance of common stock to vendor | 0 | 7 |
Issuance of common stock from cashless exercise of purchase warrants | $ 2 | $ 4 |
The Company
The Company | 9 Months Ended |
Sep. 30, 2022 | |
Company | |
The Company | 1. The Company Background Xenetic Biosciences, Inc. (“Xenetic” or the “Company”), incorporated in the state of Nevada and based in Framingham, Massachusetts, is a biopharmaceutical company focused on advancing innovative immune-oncology technologies addressing hard to treat cancers. The Company’s Deoxyribonuclease (“DNase”) platform is designed to improve outcomes of existing treatments, including immunotherapies, by targeting neutrophil extracellular traps (“NETs”). Xenetic is currently focused on advancing its systemic DNase program into the clinic as an adjunctive therapy for pancreatic carcinoma and locally advanced or metastatic solid tumors. The Company is also developing its personalized Chimeric Antigen Receptor (“CAR”) T platform technology, XCART ™ ® As used in this Quarterly Report on Form 10-Q (“Quarterly Report”), unless otherwise indicated, all references herein to “Xenetic,” the “Company,” “we” or “us” refer to Xenetic Biosciences, Inc. and its wholly owned subsidiaries. The Company, directly or indirectly, through its wholly-owned subsidiaries, Hesperix S.A. (“Hesperix”) and Xenetic Biosciences (U.K.) Limited (“Xenetic UK”), and the wholly-owned subsidiaries of Xenetic UK, Lipoxen Technologies Limited (“Lipoxen”), Xenetic Bioscience, Incorporated and SymbioTec, GmbH (“SymbioTec”), own various United States (“U.S.”) federal trademark registrations and applications, and unregistered trademarks and service marks, including but not limited to XCART, OncoHist™, PolyXen, ErepoXen™, and ImuXen™, which are used throughout this Quarterly Report. All other company and product names may be trademarks of the respective companies with which they are associated. Going Concern and Management’s Plan Management evaluates whether there are conditions or events, considered in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The Company has incurred substantial losses since its inception and expects to continue to incur operating losses in the near-term. These factors raise substantial doubt about its ability to continue as a going concern. The Company believes that it has access to capital resources through possible public or private equity offerings, debt financings, corporate collaborations, related party funding, or other means to continue as a going concern. The Company believes that its existing resources will be adequate to fund the Company’s operations into the first quarter of 2024. However, the Company anticipates it may need additional capital in the long-term to pursue its business initiatives. The terms, timing and extent of any future financing will depend upon several factors, including the achievement of progress in its clinical development programs, its ability to identify and enter into licensing or other strategic arrangements, its continued listing on the Nasdaq Stock Market (“Nasdaq”), and factors related to financial, economic, geo-political, industry and market conditions, many of which are beyond its control. The capital markets for the biotech industry can be highly volatile, which make the terms, timing and extent of any future financing uncertain. On June 3, 2022, the Company received a written notification (the “Notice”) from the Listing Qualifications Department of Nasdaq notifying the Company that the closing bid price for its common stock had been below $1.00 for 30 consecutive business days and that the Company therefore is not in compliance with the minimum bid price requirement for continued inclusion on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”). The Notice has no immediate effect on the listing of the Company’s common stock on the Nasdaq Capital Market. Under the Nasdaq Listing Rules, the Company has a period of 180 calendar days from the date of the Notice to regain compliance with the Bid Price Requirement. Accordingly, the Company has until November 30, 2022 to regain compliance with the Bid Price Requirement and may be eligible for an additional 180 calendar day compliance period if certain other criteria are met. |
Risks and Uncertainties
Risks and Uncertainties | 9 Months Ended |
Sep. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
Risks and Uncertainties | 2. Risks and Uncertainties Effects of the COVID-19 During March 2020, a global pandemic was declared by the World Health Organization related to the outbreak of a novel strain of coronavirus, or COVID-19. The pandemic has significantly affected economic conditions in the U.S., accelerating during the first half of March 2020 and continuing throughout 2021 and into 2022, as federal, state and local governments reacted to the public health crisis with mitigation measures, creating significant uncertainties in the U.S. economy. The Company continues to evaluate the effects of the COVID-19 pandemic on its business and while there has been no significant impact to the Company’s operations to date, the Company at this time remains uncertain of the impact this event may have on the Company’s future operations. The extent to which the COVID-19 pandemic affects our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict, and such uncertainty is expected to continue for some time. Impact of the conflict in Ukraine on Operations The short and long-term implications of Russia’s invasion of Ukraine are difficult to predict at this time. The imposition of sanctions and counter sanctions may have an adverse effect on the economic markets generally and could impact our business, financial condition, and results of operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Preparation of Interim Financial Statements The accompanying condensed consolidated interim financial statements were prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the opinion of management, include all normal and recurring adjustments necessary to present fairly the results of the interim periods shown. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such SEC rules and regulations. Management believes that the disclosures made are adequate to make the information presented not misleading. The results for the interim periods are not necessarily indicative of results for the full year. The condensed consolidated financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 22, 2022, and amended on April 28, 2022. Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of Hesperix, Xenetic UK and Xenetic UK’s wholly owned subsidiaries: Lipoxen, Xenetic Bioscience, Incorporated, and SymbioTec. All intercompany balances and transactions have been eliminated in consolidation. Basic and Diluted Net Loss per Share The Company computes basic net loss per share by dividing net loss applicable to common stockholders by the weighted-average number of shares of the Company’s common stock outstanding during the period. The Company computes diluted net loss per share after giving consideration to the dilutive effect of stock options that are outstanding during the period, except where such non-participating securities would be anti-dilutive. For the three and nine months ended September 30, 2022 and 2021, basic and diluted net loss per share are the same for each respective period due to the Company’s net loss position. Potentially dilutive, non-participating securities have not been included in the calculations of diluted net loss per share, as their inclusion would be anti-dilutive. Recent Accounting Standards In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
Significant Strategic Collabora
Significant Strategic Collaborations | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Significant Strategic Collaborations | 4. Significant Strategic Collaborations The Company has entered into various research, development, license and supply agreements with Serum Institute of India (“Serum Institute”), PJSC Pharmsynthez (“Pharmsynthez”) and SynBio LLC (“SynBio”), a wholly owned subsidiary of Pharmsynthez. The Company’s collaborative partners continue to engage in research and development activities with no resultant commercial products through September 30, 2022. No In October 2017, the Company granted to Takeda Pharmaceuticals Co. Ltd. (“Takeda”) the right to grant a non-exclusive sublicense to certain patents related to the Company’s PolyXen technology that were previously exclusively licensed to Takeda in connection with products related to the treatment of blood and bleeding disorders. Royalty payments of approximately $ 0.4 million 1.2 million 0.3 million 0.8 million On May 15, 2020, the Company and The Scripps Research Institute (“Scripps Research”) entered into a Research Funding and Option Agreement (the “Scripps Agreement”), pursuant to which the Company had agreed to provide Scripps Research an aggregate of up to $3.0 million to fund research relating to advancing the pre-clinical development of XCART. The research funding was payable by the Company to Scripps Research on a quarterly basis in accordance with a negotiated budget, which provided for an initial payment of approximately $300,000 on the date of the Scripps Agreement and subsequent quarterly payments of approximately $300,000 over a 27-month period. Under the Scripps Agreement, Scripps Research has granted the Company a license within the Field (as defined in the Scripps Agreement) to any Patent Rights or Technology (as defined in the Scripps Agreement) under the terms of that certain license agreement with Scripps Research, dated February 25, 2019, assigned to the Company on March 1, 2019. Additionally, the Company has the option to acquire a worldwide exclusive license to Scripps Research’s rights in the Technology or Patent Rights not already licensed to the Company, as well as a non-exclusive, royalty-free, non-transferrable license to make and use Scripps Research Technology (as defined in the Scripps Agreement) solely for the Company’s internal research purposes during the performance of the research program contemplated by the Scripps Agreement. During the second quarter of 2022, the parties mutually agreed to terminate additional funding under the Scripps Agreement. As a result, Scripps Research agreed to continue to perform work under the agreement until funding previously advanced was expended. The Company paid $ 2.4 million no 0.2 million On June 30, 2022, the Company entered into a Statement of Work (the “SOW”) with Catalent Pharma Solutions, LLC (“Catalent”) to outline the general scope of work, timeline, and pricing pursuant to which Catalent will provide certain services to the Company to perform cGMP manufacturing of the Company’s recombinant protein, Human DNase I. The parties agreed to enter into a Master Services Agreement (“MSA”) that will contain terms and conditions to govern the project contemplated by the SOW and that will supersede the addendum to the SOW containing Catalent's standard terms and conditions. In addition, in the event of any conflict between the project-specific terms and conditions set forth in the SOW and the MSA, the MSA terms and conditions shall govern. The estimated total cost of the project contemplated by the SOW is expected to be up to approximately $5 million (exclusive of certain fees and potential alternatives) for the manufacturing services over the course of the term of the project with each phase of the project invoiced separately in connection with the commencement of such phase. Unless earlier terminated, the manufacturing services contemplated by the SOW are currently expected to take approximately 17 months from the start date. The SOW is terminable by the Company at any time with 30 days' prior written notice to Catalent. The SOW also contains customary provisions related to, among other things, confidentiality, warranties, intellectual property and indemnification. During the three and nine months ended September 30, 2022, the Company paid Catalent $ 0.3 million |
Licensing Arrangements
Licensing Arrangements | 9 Months Ended |
Sep. 30, 2022 | |
Licensing Arrangements | |
Licensing Arrangements | 5. Licensing Arrangements Exclusive Sublicense Agreement On April 26, 2022, the Company entered into an Exclusive Sublicense Agreement (the “Sublicense Agreement”) with CLS Therapeutics Ltd. (“CLS”) pursuant to which the Company received an exclusive license, under certain patent rights and know-how owned or controlled by CLS, to develop and commercialize pharmaceutical products and methods incorporating DNase enzyme for use in treatment of cancer (the “Sublicensed Products”). Under the terms of the Sublicense Agreement, the Company will have sole responsibility for, and shall use commercially reasonable efforts to, among other things, research, develop and obtain marketing approval for the Sublicensed Products in the U.S. and certain European markets, and to commercialize such Sublicensed Products in the relevant market once marketing approval is obtained. In consideration for the license and other rights granted to the Company under the Sublicense Agreement, the Company issued to CLS 375,000 Exclusive License Agreement On April 26, 2022, the Company entered into an Exclusive License Agreement (the “License Agreement”) with CLS, pursuant to which the Company received an exclusive license under certain patent rights and know-how owned or controlled by CLS to develop and commercialize pharmaceutical products and methods incorporating DNase in conjunction with CAR T therapies (the “Licensed Products”). Under the terms of the License Agreement, the Company will have sole responsibility for, and shall use commercially reasonable efforts to, among other things, research, develop and obtain marketing approval for the Licensed Products in the U.S. and certain European markets, and to commercialize such Licensed Products in the relevant market once marketing approval is obtained. In consideration for the license and other rights granted to the Company under the License Agreement, the Company paid CLS a one-time fee of $ 500,000 500,000 The total consideration for the Sublicense and License Agreements was approximately $ 1.3 million 0.5 million 875,000 0.8 million 1.3 million 0.2 million 0.4 million Patent Assignment and Volition Collaboration On October 4, 2022, the Company completed a patent assignment related to its collaboration with Belgian Volition SARL Limited (“Volition”) and CLS. In connection with the patent assignment, the Company entered into a Subscription Agreement with CLS Therapeutics, LLC, a Delaware limited liability company (“CLS LLC ”) on October 12, 2022, pursuant to which the Company agreed to issue to CLS LLC, and CLS LLC agreed to subscribe for, 850,000 On August 2, 2022, the Company |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements Accounting Standards Codification Topic 820, Fair Value Measurement, no |
Stockholders_ Equity
Stockholders’ Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stockholders’ Equity | 7. Stockholders’ Equity Warrants In connection with its July 2021 private placement, the Company issued warrants to purchase an aggregate of 4,629,630 3.30 February 23, 2025 No In addition to the Series A Warrants, warrants to purchase approximately 29,000 31,000 Publicly traded warrants to purchase approximately 21,000 23,000 13.00 July 17, 2024 No 2,547 1,984 4,032 None Warrants to purchase approximately 8,000 2.91 July 3, 2026 None |
Share-Based Expense
Share-Based Expense | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Expense | 8. Share-Based Expense Total share-based expense related to stock options, restricted stock units and common stock awards was approximately $ 0.1 million 0.4 million 0.3 million Share-based compensation expense is classified in the condensed consolidated statements of operations as follows: Schedule of Share-Based Compensation Expense Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Research and development expenses $ 23,382 $ 19,236 $ 65,688 $ 48,972 General and administrative expenses 113,982 91,895 327,141 248,365 $ 137,364 $ 111,131 $ 392,829 $ 297,337 Employee Stock Options During the nine months ended September 30, 2022, the Company granted 200,000 0.99 the Company’s stock price, a risk free rate of 2.38 5.88 126.32 200,000 0.1 0.4 0.3 Non-Employee Stock Options The Company did no |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes During the three and nine months ended September 30, 2022 and 2021, there was no 32.8 million 31.4 million As of September 30, 2022 and December 31, 2021, the Company did no |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | 10. Commitments Supplemental cash flow information and non-cash activity related to the Company’s operating leases are as follows: Cash flow information regarding leases Nine Months Ended September 30, Nine Months Ended September 30, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 27,043 $ 26,199 Supplemental balance sheet information related to the Company’s operating leases is as follows: Supplemental information related to operating leases Balance Sheet Classification September 30, 2022 September 30, 2021 Right-of-use assets - ST Prepaid expenses and other $ – $ 36,326 Right-of-use assets - LT Other assets $ – $ – Current lease liabilities Accrued expenses and other current liabilities $ – $ 36,326 Non-current lease liabilities Other long-term liabilities $ – $ – |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 11. Related Party Transactions The Company has entered into various research, development, license and supply agreements with Serum Institute and Pharmsynthez each a related party whose relationship has not materially changed from that disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 22, 2022, as amended on April 28, 2022. During the fourth quarter of 2019, the Company entered into a loan agreement with Pharmsynthez (the “Pharmsynthez Loan”), pursuant to which the Company advanced Pharmsynthez an aggregate principal amount of up to $ 500,000 10 12,000 9,000 35,000 no Effective January 23, 2021, the Company entered into a First Amendment to Loan Agreement and Other Loan Documents with Pharmsynthez, Kevelt and SynBio (the “Pharmsynthez Loan Extension”) to modify the repayment terms and maturity of the Pharmsynthez Loan to January 2022. The terms of the Pharmsynthez Loan Extension called for two (2) equal monthly principal payments of $ 25,000 Effective August 31, 2021, the Company entered into a Second Amendment to Loan Agreement and Other Loan Documents with Pharmsynthez, Kevelt and SynBio (the “Second Pharmsynthez Loan Extension”) to modify the repayment terms and maturity of the Pharmsynthez Loan to July 2022. The terms of the Second Pharmsynthez Loan Extension called for an upfront fee of $ 12,500 25,000 Subsequent to quarter end, the Company entered into a Third Amendment to Loan Agreement and Other Loan Documents with Pharmsynthez, Kevelt and SynBio dated October 31, 2022 (the “Third Pharmsynthez Loan Extension”) primarily to modify the repayment terms and maturity of the Pharmsynthez Loan to May 31, 2023. The terms of the Third Pharmsynthez Loan Extension require certain payments of principal, interest and fees at the signing of the Third Pharmsynthez Loan Extension. In addition, the Third Pharmsynthez Loan Extension requires the repayment of the remaining principal amount, plus interest, in seven (7) monthly installments from November 30, 2022 through May 31, 2023 as well as certain other terms and conditions. All other terms of the Pharmsynthez Loan, as amended, remained in effect. As the payments required under the Third Pharmsynthez Loan Extension have not been received to date and as a result of the ongoing economic uncertainty due to the conflict between Russia and Ukraine and associated sanctions imposed by the U.S. and other countries in response, the Company has classified the loan receivable as long-term as of September 30, 2022 and December 31, 2021. The Company assessed the collectability of the loan and determined that the U.S.-based collateral held by the Company, consisting of all of the common and preferred stock of the Company owned by Pharmsynthez and SynBio, was adequate to support the repayment of the outstanding principal balance. As of September 30, 2022 and December 31, 2021, approximately $ 0.4 million In April 2022, the Company entered into Exclusive License and Sublicense Agreements with CLS as described in Note 5. One of the Company’s directors, Roger Kornberg, is a member of the scientific advisory board of CLS, however, Mr. Kornberg does not own any equity of CLS and is not receiving any economic benefit as a result of the transactions contemplated by the License Agreement and Sublicense Agreement. Mr. Adam Logal, one of our directors, is Senior Vice President, Chief Financial Officer, Chief Accounting Officer and Treasurer of OPKO. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. Subsequent Events The Company performed a review of events subsequent to the balance sheet date through the date the financial statements were issued and determined that other than described in Notes 5 and 11, there were no such events requiring recognition or disclosure in the financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Preparation of Interim Financial Statements | Preparation of Interim Financial Statements The accompanying condensed consolidated interim financial statements were prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the opinion of management, include all normal and recurring adjustments necessary to present fairly the results of the interim periods shown. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such SEC rules and regulations. Management believes that the disclosures made are adequate to make the information presented not misleading. The results for the interim periods are not necessarily indicative of results for the full year. The condensed consolidated financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 22, 2022, and amended on April 28, 2022. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of Hesperix, Xenetic UK and Xenetic UK’s wholly owned subsidiaries: Lipoxen, Xenetic Bioscience, Incorporated, and SymbioTec. All intercompany balances and transactions have been eliminated in consolidation. |
Basic and Diluted Net Loss per Share | Basic and Diluted Net Loss per Share The Company computes basic net loss per share by dividing net loss applicable to common stockholders by the weighted-average number of shares of the Company’s common stock outstanding during the period. The Company computes diluted net loss per share after giving consideration to the dilutive effect of stock options that are outstanding during the period, except where such non-participating securities would be anti-dilutive. For the three and nine months ended September 30, 2022 and 2021, basic and diluted net loss per share are the same for each respective period due to the Company’s net loss position. Potentially dilutive, non-participating securities have not been included in the calculations of diluted net loss per share, as their inclusion would be anti-dilutive. |
Recent Accounting Standards | Recent Accounting Standards In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
Share-Based Expense (Tables)
Share-Based Expense (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-Based Compensation Expense | Schedule of Share-Based Compensation Expense Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Research and development expenses $ 23,382 $ 19,236 $ 65,688 $ 48,972 General and administrative expenses 113,982 91,895 327,141 248,365 $ 137,364 $ 111,131 $ 392,829 $ 297,337 |
Commitments (Tables)
Commitments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Cash flow information regarding leases | Cash flow information regarding leases Nine Months Ended September 30, Nine Months Ended September 30, 2022 2021 Operating cash flow information: Cash paid for amounts included in the measurement of lease liabilities $ 27,043 $ 26,199 |
Supplemental information related to operating leases | Supplemental information related to operating leases Balance Sheet Classification September 30, 2022 September 30, 2021 Right-of-use assets - ST Prepaid expenses and other $ – $ 36,326 Right-of-use assets - LT Other assets $ – $ – Current lease liabilities Accrued expenses and other current liabilities $ – $ 36,326 Non-current lease liabilities Other long-term liabilities $ – $ – |
Significant Strategic Collabo_2
Significant Strategic Collaborations (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Rcognized revenue | $ 414,250 | $ 349,269 | $ 1,219,953 | $ 828,088 | |
Revenue | 414,250 | 349,269 | 1,219,953 | 828,088 | |
Research and development expenses | 398,803 | 780,153 | 3,577,701 | 1,934,432 | |
Prepaid Expense and Other Assets, Current | 319,103 | 319,103 | $ 479,399 | ||
Payments or costs | 300,000 | ||||
Long term prepayment | 300,000 | 300,000 | |||
Scripps Research [Member] | Scripps Agreement [Member] | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Research and development expenses | 2,400,000 | ||||
Prepaid Expense and Other Assets, Current | 0 | 0 | $ 200,000 | ||
Collaborative Agreements [Member] | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Rcognized revenue | 0 | 0 | |||
Royalty Revenue [Member] | Takeda [Member] | |||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||
Revenue | $ 400,000 | $ 300,000 | $ 1,200,000 | $ 800,000 |
Licensing Arrangements (Details
Licensing Arrangements (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Oct. 12, 2022 | Apr. 26, 2022 | Apr. 26, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | |
Offsetting Assets [Line Items] | |||||
One-time fee payment | $ 300,000 | ||||
Number of shares new issues | 850,000 | ||||
Sublicense And License Agreements [Member] | |||||
Offsetting Assets [Line Items] | |||||
Number of consideration shares issued | 875,000 | ||||
Consideration amount | $ 1,300,000 | ||||
Payments to Acquire Productive Assets | $ 500,000 | ||||
Number of shares purchase of asset, value | $ 800,000 | ||||
Research and development expense | 1,300,000 | ||||
Consulting and transaction costs | $ 200,000 | $ 400,000 | |||
Sublicense Agreement Shares [Member] | C L S [Member] | |||||
Offsetting Assets [Line Items] | |||||
Number of consideration shares issued | 375,000 | ||||
Sublicense And License Agreements [Member] | C L S [Member] | |||||
Offsetting Assets [Line Items] | |||||
Number of consideration shares issued | 500,000 | ||||
One-time fee payment | $ 500,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial instruments fair value | $ 0 | $ 0 |
Stockholders_ Equity (Details N
Stockholders’ Equity (Details Narrative) - $ / shares | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Jul. 31, 2021 | |
Publicly Traded Warrants [Member] | ||||||
Class of Stock [Line Items] | ||||||
Exercise Price | $ 13 | $ 13 | ||||
Maturity date | Jul. 17, 2024 | Jul. 17, 2024 | ||||
Warrants forfeited | 0 | 0 | 0 | 0 | ||
Warrant Outstanding | 21,000 | 21,000 | 23,000 | |||
Warrants exercised shares | 0 | 2,547 | 1,984 | 4,032 | ||
Other Warrants [Member] | ||||||
Class of Stock [Line Items] | ||||||
Exercise Price | $ 2.91 | $ 2.91 | ||||
Maturity date | Jul. 03, 2026 | Jul. 03, 2026 | ||||
Warrant Outstanding | 8,000 | 8,000 | 8,000 | |||
Warrants exercised shares | 0 | 0 | 0 | 0 | ||
Warrants forfeited shares | 0 | 0 | 0 | 0 | ||
Private Placement [Member] | Series A Warrants [Member] | ||||||
Class of Stock [Line Items] | ||||||
Warrants issued | 4,629,630 | |||||
Exercise Price | $ 3.30 | |||||
Maturity date | Feb. 23, 2025 | |||||
Warrants forfeited | 0 | 0 | ||||
Warrants exercised | 0 | 0 | ||||
Warrant Outstanding | 29,000 | 29,000 | 31,000 |
Share-Based Expense (Details -
Share-Based Expense (Details - Share based expense) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Share-based compensation | $ 137,364 | $ 111,131 | $ 392,829 | $ 297,337 |
Research and Development Expense [Member] | ||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Share-based compensation | 23,382 | 19,236 | 65,688 | 48,972 |
General and Administrative Expense [Member] | ||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Share-based compensation | $ 113,982 | $ 91,895 | $ 327,141 | $ 248,365 |
Share-Based Expense (Details Na
Share-Based Expense (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Share based compensation | $ 100,000 | $ 100,000 | $ 400,000 | $ 300,000 |
Employee Stock Options [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Stock option granted | 200,000 | 200,000 | ||
Weighted average grant date fair value | $ 0.99 | |||
Risk free rate | 2.38% | |||
Expected term | 5 years 10 months 17 days | |||
Volatility rate | 126.32% | |||
Non Employee Stock Options [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Stock option granted | 0 | 0 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
Provision for income taxes | $ 0 | $ 0 | $ 0 | $ 0 | |
Deferred tax valuation allowance | 32,800,000 | 32,800,000 | $ 31,400,000 | ||
Unrecognized tax positions | $ 0 | $ 0 | $ 0 |
Commitments (Details - Cash flo
Commitments (Details - Cash flow Information) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating cash flow information: | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 27,043 | $ 26,199 |
Commitments (Details - lease in
Commitments (Details - lease information) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-use assets - ST | $ 0 | $ 36,326 |
Right-of-use assets - LT | 0 | 0 |
Current lease liabilities | 0 | 36,326 |
Non-current lease liabilities | $ 0 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - Pharmsynthez [Member] - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
Oct. 31, 2021 | Sep. 30, 2021 | Feb. 28, 2021 | Jan. 23, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||||||||||
Monthly principal payments | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||
Loan Extension Fees | $ 12,500 | |||||||||
Co Development Agreement [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Payments to Acquire Notes Receivable | $ 500,000 | |||||||||
Accrued interest rate | 10% | 10% | ||||||||
Interest and Fee Income, Other Loans | $ 0 | $ 12,000 | $ 9,000 | $ 35,000 | ||||||
Sponsored Research Agreement [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Prepaid expenses and other current asset | $ 400,000 | $ 400,000 | $ 400,000 |