Xenetic Biosciences(XBIO) - 2024 Q1 - Quarterly Report

Financial Performance - Total revenue for Q1 2024 was $510,817, a decrease of 15.6% compared to$ 605,844 in Q1 2023[11] - Net loss for Q1 2024 was $1,195,113, compared to a net loss of$ 856,554 in Q1 2023, representing an increase of 39.7%[11] - Basic and diluted loss per share for Q1 2024 was $0.78, compared to$ 0.56 in Q1 2023[11] - Revenue for Q1 2024 decreased by $0.1 million, or 15.7%, to$ 0.5 million from approximately $0.6 million in Q1 2023, primarily due to timing of rebates related to a sublicense agreement with Takeda Pharmaceuticals[65] - The net loss for Q1 2024 was approximately$ 1.2 million, compared to a net loss of approximately $0.9 million in Q1 2023, representing an increase in loss of$ 0.3 million or 39.5%[64] - Working capital decreased by $1.1 million to approximately$ 7.7 million at March 31, 2024, primarily due to the net loss incurred during the quarter[70] - Cash flows used in operating activities totaled approximately $1.2 million for Q1 2024, compared to approximately$ 1.1 million for Q1 2023, primarily due to net loss[73] Research and Development - Research and development expenses increased to $944,321 in Q1 2024, up 58.6% from$ 595,276 in Q1 2023[11] - Research and development expenses increased by approximately $0.3 million, or 58.6%, to approximately$ 0.9 million in Q1 2024 from approximately $0.6 million in Q1 2023, driven by increased spending on pre-clinical development for the DNase platform[66] - The company is focused on advancing its systemic DNase program for pancreatic carcinoma and has partnered with other companies to develop its proprietary drug delivery platform, PolyXen[21] - The company is focused on advancing its systemic DNase program as an adjunctive therapy for pancreatic carcinoma and locally advanced or metastatic solid tumors[61] - The Company has entered into a Research Funding and Option Agreement with Scripps Research, committing up to$ 0.9 million for research on the DNase oncology platform technology, with approximately $0.9 million already paid as of March 31, 2024[35] Financial Position - Cash at the end of Q1 2024 was$ 7,823,701, down from $11,994,827 at the end of Q1 2023, a decrease of 34.8%[17] - Total assets decreased to$ 9,394,096 as of March 31, 2024, down from $10,605,226 as of December 31, 2023, a decline of 11.4%[9] - Total stockholders' equity decreased to$ 8,677,602 as of March 31, 2024, down from $9,795,641 as of December 31, 2023, a decrease of 11.4%[9] - The accumulated deficit increased to approximately$ 194.4 million at March 31, 2024, compared to approximately $193.2 million at December 31, 2023[70] - The valuation allowance against deferred tax assets was approximately$ 40.1 million as of March 31, 2024, compared to $39.7 million as of December 31, 2023, indicating an increase of about 1.01%[50] Future Outlook - The company expects to continue incurring operating losses in the near term, raising substantial doubt about its ability to continue as a going concern[24] - The company anticipates needing additional capital in the long term to pursue its business initiatives[24] - The company anticipates needing additional capital in the long-term to pursue business initiatives, with existing resources expected to fund operations for at least twelve months[72] Legal and Compliance - The company has not received regulatory marketing authorization for any drug candidates to date, focusing on advancing the DNase technology[62] - The company has no off-balance sheet financing arrangements that could materially affect its financial condition[78] - There have been no material changes in critical accounting estimates from those disclosed in the Annual Report for the year ended December 31, 2023[80] - The management evaluated the effectiveness of disclosure controls and procedures, concluding they are effective as of the end of the reporting period[83] - There were no changes in internal control over financial reporting that would materially affect it during the reporting period[84] - The company is not currently subject to any material legal proceedings, nor are any threatened against it[86] - There have been no material changes to the risk factors previously disclosed in the Annual Report for the year ended December 31, 2023[87] - No unregistered sales of equity securities occurred during the reporting period[88] - No defaults upon senior securities were reported[89] - No director or officer adopted or terminated any trading arrangements during the quarter ended March 31, 2024[91] - The company filed various certifications in compliance with the Sarbanes-Oxley Act of 2002[93] Other Financial Activities - The Company recognized total share-based expense of approximately$ 0.1 million for both the three months ended March 31, 2024, and 2023[45] - No stock option awards were granted during the three months ended March 31, 2024, and 2023, with no options exercised or expired in either period[47] - The Company has approximately 462,963 Series A Warrants outstanding, exercisable at $33.00 per share, with no warrants exercised during the three months ended March 31, 2024, and 2023[42] - The Company incurred no provision for income taxes during the three months ended March 31, 2024, and 2023, due to losses in both periods[50] - The Company has paid approximately$ 2.5 million to Catalent for services related to the cGMP manufacturing of Human DNase I as of March 31, 2024[34] - The Company has paid approximately $0.1 million to UVA under a research agreement as of March 31, 2024, with$ 29,000 recognized as an advance payment[36] - For the three months ended March 31, 2024, the Company recorded royalty payments of approximately $0.5 million from Takeda, compared to$ 0.6 million in the same period of 2023, reflecting a decrease of about 16.67%[32]