10/30/2024 | Press release | Distributed by Public on 10/30/2024 14:06
United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2024 |
or
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ____ to ____ |
Processa Pharmaceuticals, Inc.
(Exact name of registrant as specified in its charter)
Delaware | 45-1539785 | |
(State or other jurisdiction of incorporation or organization) |
(IRS Employer Identification No.) |
7380 Coca Cola Drive, Suite 106,
Hanover, Maryland21076
(443) 776-3133Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, $0.0001 par value per share | PCSA | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☒ No ☐
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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See definition 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 | ☐ |
Non-accelerated filer | ☒ | 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 registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒The number of outstanding shares of the registrant's common stock at October 15, 2024 was 3,266,944.
PROCESSA PHARMACEUTICALS, INC.
TABLE OF CONTENTS
Part I. Financial Information | 3 |
Item 1: Financial Statements | 3 |
Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations | 15 |
Item 3. Quantitative and Qualitative Disclosures about Market Risk | 26 |
Item 4. Controls and Procedures | 26 |
Part II. Other Information | 26 |
Item 1. Legal Procedures | 26 |
Item 1A. Risk Factors | 26 |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 27 |
Item 3. Defaults Upon Senior Securities | 27 |
Item 4. Mine Safety Disclosures | 27 |
Item 5. Other Information | 27 |
Item 6. Exhibits | 28 |
Signatures | 29 |
2 |
Part I: Financial Information
Item 1: Financial Statements
Processa Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
September 30, 2024 | December 31, 2023 | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 2,891,464 | $ | 4,706,197 | ||||
Prepaid expenses and other | 1,946,675 | 926,300 | ||||||
Total Current Assets | 4,838,139 | 5,632,497 | ||||||
Property and Equipment, net | 5,317 | 2,554 | ||||||
Other Assets | ||||||||
Lease right-of-use assets, net of accumulated amortization | 93,161 | 146,057 | ||||||
Security deposit | 5,535 | 5,535 | ||||||
Total Other Assets | 98,696 | 151,592 | ||||||
Total Assets | $ | 4,942,152 | $ | 5,786,643 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current Liabilities | ||||||||
Current maturities of lease liabilities | $ | 94,676 | $ | 83,649 | ||||
Accounts payable | 711,710 | 311,617 | ||||||
Due to licensor | - | 189,000 | ||||||
Due to related parties | - | 39 | ||||||
Accrued expenses | 412,813 | 146,274 | ||||||
Total Current Liabilities | 1,219,199 | 730,579 | ||||||
Non-current Liabilities | ||||||||
Non-current lease liabilities | 2,168 | 66,905 | ||||||
Total Liabilities | 1,221,367 | 797,484 | ||||||
Commitments and Contingencies | - | - | ||||||
Stockholders' Equity | ||||||||
Common stock, par value $0.0001, 100,000,000shares authorized: 3,271,944issued and 3,266,944outstanding at September 30, 2024; and 1,291,000issued and 1,286,000outstanding at December 31, 2023 | 327 | 129 | ||||||
Additional paid-in capital | 88,510,949 | 80,658,111 | ||||||
Treasury stock at cost - 5,000shares at September 30, 2024 and December 31, 2023 | (300,000 | ) | (300,000 | ) | ||||
Accumulated deficit | (84,490,491 | ) | (75,369,081 | ) | ||||
Total Stockholders' Equity | 3,720,785 | 4,989,159 | ||||||
Total Liabilities and Stockholders' Equity | $ | 4,942,152 | $ | 5,786,643 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
3 |
Processa Pharmaceuticals, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Operating Expenses | ||||||||||||||||
Research and development | $ | 2,287,525 | $ | 1,151,740 | $ | 5,556,694 | $ | 4,478,793 | ||||||||
General and administrative | 1,137,328 | 1,015,872 | 3,759,781 | 4,508,818 | ||||||||||||
Operating Loss | (3,424,853 | ) | (2,167,612 | ) | (9,316,475 | ) | (8,987,611 | ) | ||||||||
Other Income (Expense) | ||||||||||||||||
Interest income, net | 40,150 | 85,661 | 195,065 | 271,022 | ||||||||||||
Net Loss | $ | (3,384,703 | ) | $ | (2,081,951 | ) | $ | (9,121,410 | ) | $ | (8,716,589 | ) | ||||
Net Loss per Common Share - Basic and Diluted | $ | (1.03 | ) | $ | (1.54 | ) | $ | (3.13 | ) | $ | (6.81 | ) | ||||
Weighted Average Common Shares Used to Compute Net Loss Applicable to Common Shares - Basic and Diluted | 3,275,998 | 1,350,188 | 2,909,941 | 1,279,298 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
4 |
Processa Pharmaceuticals, Inc.
Condensed Consolidated Statements of Changes in Stockholders' Equity
(Unaudited)
Additional | ||||||||||||||||||||||||||||
Common Stock | Paid-In | Treasury Stock | Accumulated | |||||||||||||||||||||||||
Shares | Amount | Capital | Shares | Amount | Deficit | Total | ||||||||||||||||||||||
Balance at January 1, 2023 | 806,774 | $ | 80 | $ | 72,018,222 | (5,000 | ) | $ | (300,000 | ) | $ | (64,247,561 | ) | $ | 7,470,741 | |||||||||||||
Stock-based compensation | 3,195 | 1 | 341,503 | - | - | - | 341,504 | |||||||||||||||||||||
Shares issued in connection with capital raises, net of transaction costs | 421,611 | 42 | 6,352,035 | - | - | - | 6,352,077 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (4,022,073 | ) | (4,022,073 | ) | |||||||||||||||||||
Balance, March 31, 2023 | 1,231,580 | 123 | 78,711,760 | (5,000 | ) | (300,000 | ) | (68,269,634 | ) | 10,142,249 | ||||||||||||||||||
Stock-based compensation | - | - | 319,123 | - | - | - | 319,123 | |||||||||||||||||||||
Warrant granted in connection with a consulting agreement | - | - | 1,310,875 | - | 1,310,875 | |||||||||||||||||||||||
Net loss | - | - | - | - | - | (2,612,565 | ) | (2,612,565 | ) | |||||||||||||||||||
Balance, June 30, 2023 | 1,231,580 | 123 | 80,341,758 | (5,000 | ) | (300,000 | ) | (70,882,199 | ) | 9,159,682 | ||||||||||||||||||
Stock-based compensation, net of forfeitures | 5,000 | 1 | 142,893 | - | - | - | 142,894 | |||||||||||||||||||||
Settlement of stock award | - | - | (52,746 | ) | - | - | - | (52,746 | ) | |||||||||||||||||||
Net loss | - | - | - | - | - | (2,081,951 | ) | (2,081,951 | ) | |||||||||||||||||||
Balance, September 30, 2023 | 1,236,580 | $ | 124 | $ | 80,431,905 | (5,000 | ) | $ | (300,000 | ) | $ | (72,964,150 | ) | $ | 7,167,879 |
Additional | ||||||||||||||||||||||||||||
Common Stock | Paid-In | Treasury Stock | Accumulated | |||||||||||||||||||||||||
Shares | Amount | Capital | Shares | Amount | Deficit | Total | ||||||||||||||||||||||
Balance at January 1, 2024 | 1,291,000 | $ | 129 | $ | 80,658,111 | (5,000 | ) | $ | (300,000 | ) | $ | (75,369,081 | ) | $ | 4,989,159 | |||||||||||||
Stock-based compensation | 13,176 | 1 | 167,642 | - | - | - | 167,643 | |||||||||||||||||||||
Shares issued in connection with capital raise, net of transaction costs | 1,555,555 | 156 | 6,282,274 | - | - | - | 6,282,430 | |||||||||||||||||||||
Shares issued in connection with license agreement | 5,000 | 1 | 188,999 | - | - | - | 189,000 | |||||||||||||||||||||
Settlement of stock award | - | - | (8,561 | ) | - | - | - | (8,561 | ) | |||||||||||||||||||
Shares withheld to pay income taxes on stock-based compensation | (3,750 | ) | (1 | ) | (9,923 | ) | - | - | - | (9,924 | ) | |||||||||||||||||
Net loss | - | - | - | - | - | (2,726,381 | ) | (2,726,381 | ) | |||||||||||||||||||
Balance, March 31, 2024 | 2,860,981 | 286 | 87,278,542 | (5,000 | ) | (300,000 | ) | (78,095,462 | ) | 8,883,366 | ||||||||||||||||||
Stock-based compensation | 14,167 | 1 | 152,631 | - | - | - | 152,632 | |||||||||||||||||||||
Shares withheld to pay income taxes on stock-based compensation | (1,265 | ) | - | (2,008 | ) | - | - | - | (2,008 | ) | ||||||||||||||||||
Net loss | - | - | - | - | - | (3,010,326 | ) | (3,010,326 | ) | |||||||||||||||||||
Balance, June 30, 2024 | 2,873,883 | 287 | 87,429,165 | (5,000 | ) | (300,000 | ) | (81,105,788 | ) | 6,023,664 | ||||||||||||||||||
Stock-based compensation | 26,010 | 3 | 154,188 | - | - | - | 154,191 | |||||||||||||||||||||
Shares issued in connection with capital raise, net of transaction costs | 374,190 | 37 | 931,254 | - | - | - | 931,291 | |||||||||||||||||||||
Shares withheld to pay income taxes on stock-based compensation | (2,139 | ) | - | (3,658 | ) | - | - | - | (3,658 | ) | ||||||||||||||||||
Net loss | - | - | - | - | - | (3,384,703 | ) | (3,384,703 | ) | |||||||||||||||||||
Balance, September 30, 2024 | 3,271,944 | $ | 327 | $ | 88,510,949 | (5,000 | ) | $ | (300,000 | ) | $ | (84,490,491 | ) | $ | 3,720,785 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
5 |
Processa Pharmaceuticals, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended September 30, | ||||||||
2024 | 2023 | |||||||
Cash Flows From Operating Activities | ||||||||
Net loss | $ | (9,121,410 | ) | $ | (8,716,589 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation | 481 | 82 | ||||||
Non-cash lease expense for right-of-use assets | 64,700 | 60,552 | ||||||
Stock-based compensation | 474,466 | 803,521 | ||||||
Warrants issued to purchase 158,007shares of common stock in connection with a consulting agreement | - | 1,310,875 | ||||||
Net changes in operating assets and liabilities: | ||||||||
Prepaid expenses and other | (1,020,375 | ) | 836,344 | |||||
Operating lease liability | (61,776 | ) | (57,929 | ) | ||||
Accounts payable | 400,093 | 18,751 | ||||||
Due (from) to related parties | (39 | ) | 5,740 | |||||
Accrued expenses | 266,539 | (200,825 | ) | |||||
Net cash used in operating activities | (8,997,321 | ) | (5,939,478 | ) | ||||
Cash Flows From Investing Activities | ||||||||
Purchase of property and equipment | (3,244 | ) | (2,776 | ) | ||||
Net cash used in investing activities | (3,244 | ) | (2,776 | ) | ||||
Cash Flows From Financing Activities | ||||||||
Net proceeds from common stock issued | 7,213,721 | 6,352,077 | ||||||
Shares withheld to pay taxes on stock-based compensation | (15,590 | ) | - | |||||
Settlement of stock award | (8,561 | ) | (52,746 | ) | ||||
Payment of finance lease obligation | (3,738 | ) | - | |||||
Net cash provided by (used in) financing activities | 7,185,832 | 6,299,331 | ||||||
Net Increase (Decrease) in Cash | (1,814,733 | ) | 357,077 | |||||
Cash and Cash Equivalents - Beginning of Period | 4,706,197 | 6,503,595 | ||||||
Cash and Cash Equivalents - End of Period | $ | 2,891,464 | $ | 6,860,672 | ||||
Non-Cash Financing Activities | ||||||||
Issuance of common stock in satisfaction of a due to licensor in connection with a licensing agreement | $ | 189,000 | $ | - | ||||
Right-of-use asset obtained in exchange for financing lease liability | $ | 11,804 | $ | - | ||||
Financing lease liability | (11,804 | ) | - | |||||
Net | $ | - | $ | - |
The accompanying notes are an integral part of these condensed consolidated financial statements.
6 |
Processa Pharmaceuticals, Inc.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Note 1 - Organization and Summary of Significant Accounting Policies
Organization
We are a clinical-stage biopharmaceutical company focused on incorporating our Regulatory Science Approach into the development of our Next Generation Chemotherapy ("NGC") drugs to improve the safety and efficacy of cancer treatment. Our NGC drugs are modifications of existing FDA-approved oncology drugs resulting in an alteration of the metabolism and/or distribution in the body, while maintaining the well-established existing mechanisms of killing the cancer cells. By modifying the NGC drugs in this manner, we believe our three NGC treatments will provide improved safety-efficacy profiles when compared to their currently marketed counterparts.
On January 22, 2024, we filed a Certificate of Amendment to our Certificate of Incorporation, as amended, with the Secretary of State of Delaware that effected a 1-for-20 reverse stock splitof our common stock, par value $0.0001per share (the "Reverse Stock Split"). Pursuant to the Certificate of Amendment, our issued common stock decreased from 24,706,474shares to 1,291,000shares and our outstanding common stock decreased from 24,606,474to 1,286,000. The Reverse Stock Split did not affect our authorized common stock of 100,000,000shares or our common stock par value. All shares of common stock, including common stock underlying warrants, stock options, restricted stock awards and restricted stock units, as well as exercise prices and per share information in these condensed consolidated financial statements give retroactive effect to the Reverse Stock Split.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements 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 of the Securities and Exchange Commission ("SEC") on Form 10-Q and Article 8 of Regulation S-X.
Accordingly, they do not include all the information and disclosures required by U.S. GAAP for complete financial statements. All material intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary, which are of a normal and recurring nature, for the fair presentation of our financial position and of the results of operations and cash flows for the periods presented. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC. The results of operations for the interim periods shown in this report are not necessarily indicative of the results that may be expected for any other interim period or for the full year.
Liquidity
Our condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. We have incurred losses since inception, are currently devoting substantially all of our efforts toward research and development of our NGC drug product candidates, including conducting clinical trials and providing general and administrative support for these operations, and have an accumulated deficit of $84.5million at September 30, 2024. During the nine months ended September 30, 2024, we generated a net loss of $9.1million and used $9.0million in net cash for operating activities. To date, none of our drug candidates have been approved for sale, and therefore we have not generated any product revenue and do not expect positive cash flow from operations in the foreseeable future.
We have financed our operations primarily through public equity issuances, including an offering we closed on January 30, 2024, where we sold 476,000shares of our common stock, pre-funded warrants to purchase up to 1,079,555shares of our common stock, and warrants for the purchase of up to 1,555,555shares of our common stock for net proceeds of $6.3million, after deducting placement agent fees and offering-related expenses. Simultaneously with the closing of the sale, the pre-funded warrants were exercised in exchange for 1,079,555shares of our common stock.
7 |
In May 2024, we filed with the SEC a registration statement on Form S-3 (Registration No. 333-279588) (the "Registration Statement"), including a base prospectus relating to the offering of up to $50,000,000in the aggregate of the securities identified in the base prospectus from time to time in one or more offerings; and a prospectus supplement relating to the shares of our common stock that may be issued and sold under a sales agreement dated May 21, 2024 (the "Sales Agreement") between us and A.G.P./Alliance Global Partners (the "Sales Agent"), through which we may issue and sell in a registered "at the market offering" shares of our common stock having an aggregate offering price of up to $2.4million (subject to adjustment) from time to time through or to our Sales Agent (the "ATM Offering"). We expect to use net proceeds, if any, from the ATM Offering over time for continued research and development for our portfolio of drug candidates, especially our oncology products, and working capital and general corporate purposes. The shares under the ATM Offering will be sold and issued pursuant to the Registration Statement. On July 31, 2024, we received $931,000in net proceeds from the sale of 374,190shares of common stock under the ATM Offering.
We do not have sufficient cash on hand or available to fund our operations for the next twelve months. At September 30, 2024, we had cash and cash equivalents totaling $2.9million. Based on our current business plans, we will need to obtain additional funding from the sale of equity and/or debt securities, complete a strategic transaction or other funding transactions in order to continue our Phase 2 trial of NGC-Cap and conduct future preclinical studies and clinical trials for other drugs in our portfolio. In 2024, we started our Phase 2 trial of NGC-Cap in breast cancer, and on October 2, 2024, we dosed the first patient in that trial. We will continue to be dependent upon equity and/or debt financing until we are able to generate positive cash flows from our operations.
We plan to raise additional funds in the future through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements, but will only do so if the terms are acceptable to us. If we are unable to obtain adequate financing when needed, we may have to delay, reduce the scope of, or suspend our current or planned future clinical trial plans, or research and development programs. This may also cause us to not meet obligations contained in certain of our license agreements and put these assets at risk. To the extent that we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our product candidates, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us. If we raise additional capital through public or private equity offerings, the ownership interest of our existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders' rights. If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or making capital expenditures. There can be no assurance that future funding will be available when needed.
Absent additional funding, we believe that our cash and cash equivalents will not be sufficient to fund our operations for a period of one year or more after the date that these condensed consolidated financial statements are available to be issued based on the timing and amount of our projected net loss from continuing operations and cash to be used in operating activities during that period of time. As a result, substantial doubt exists about our ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are available to be issued. The accompanying condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be different should we be unable to continue as a going concern based on the outcome of these uncertainties described above.
8 |
Use of Estimates
In preparing our condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP and pursuant to the rules and regulations of the SEC, we make estimates and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates are used for, but not limited to preclinical and clinical trial expenses, stock-based compensation, intangible assets, future milestone payments and income taxes. These estimates and assumptions are continuously evaluated and are based on management's experience and knowledge of the relevant facts and circumstances. While we believe the estimates to be reasonable, actual results could differ materially from those estimates and could impact future results of operations and cash flows.
Income Taxes
We account for income taxes in accordance with ASC Topic 740, Income Taxes. Deferred income taxes are recorded for the expected tax consequences of temporary differences between the basis of assets and liabilities for financial reporting purposes and amounts recognized for income tax purposes. At September 30, 2024 and December 31, 2023, we recorded a valuation allowance equal to the full recorded amount of our net deferred tax assets since it is more-likely-than-not that such benefits will not be realized. The valuation allowance is reviewed quarterly and will be maintained until sufficient positive evidence exists to support its reversal.
Under ACS 740-270 Income Taxes - Interim Reporting, we are required to project our annual federal and state effective income tax rate and apply it to the year-to-date ordinary operating tax basis loss before income taxes. Based on the projection, no current income tax benefit or expense is expected for 2024 and the foreseeable future since we expect to generate taxable net operating losses.
Concentration of Credit Risk
Financial instruments that potentially subject us to significant concentration of credit risk consist primarily of our cash and cash equivalents. We utilize only well-established banks and financial institutions with high credit ratings. Balances on deposit are insured by the Federal Deposit Insurance Corporation ("FDIC") up to specified limits. Total cash held by our banks at September 30, 2024, exceeded FDIC limits.
Recent Accounting Pronouncements
From time to time, the Financial Accounting Standards Board ("FASB") or other standard setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification are communicated through issuance of an Accounting Standards Update ("ASU"). We have implemented all new accounting pronouncements that are in effect and that may impact our condensed consolidated financial statements. We have evaluated recently issued accounting pronouncements and determined that there is no material impact on our condensed consolidated financial position or results of operations.
9 |
Note 2 - Stockholders' Equity
Preferred Stock
There were noissued or outstanding shares of preferred stock at either September 30, 2024 or December 31, 2023.
Common Stock
During the nine months ended September 30, 2024, we sold 476,000shares of common stock, pre-funded warrants to purchase up to 1,079,555shares of common stock in lieu of shares of common stock (the "Pre-Funded Warrants"), and warrants to purchase up to 1,555,555shares of our common stock (the "Common Warrants") in a public offering (the "Offering"). The Common Warrants have an exercise price of $4.50, are immediately exercisable and expire on January 30, 2029. The shares of common stock were offered at a combined public offering price of $4.50per share and accompanying Common Warrant and $4.4999per Pre-Funded Warrant and accompanying Common Warrant. The Pre-Funded Warrants had an exercise price of $0.0001and were exercised in full simultaneously with the closing of the Offering in exchange for 1,079,555shares of our common stock. Gross proceeds in connection with the Offering were $7.0million. We received $6.3million in net proceeds from the Offering, after deducting the fees of the placement agent and other offering-related expenses. We also issued to the placement agent warrants to purchase 62,222shares of common stock, exercisable at $5.625per share that expire on February 1, 2027.
During the nine months ended September 30, 2024, we also received approximately $931,000in net proceeds from the sale of 374,190shares of common stock under the ATM Offering on July 31, 2024. During the nine months ended September 30, 2024, we also issued (i) 5,000shares of common stock to Elion Oncology, Inc. ("Elion") in satisfaction of the third milestone event under the license agreement; (ii) 30,000shares of common stock to a consultant in accordance with their consulting agreement; and (iii) 16,199shares of common stock to certain employees and consultants, net of 7,154shares of common stock withheld for income taxes owed upon distribution of the shares.Note 3 - Stock-based Compensation
On June 19, 2019, our stockholders approved, and we adopted, the Processa Pharmaceuticals Inc. 2019 Omnibus Equity Incentive Plan (the "2019 Plan"). The 2019 Plan allows us, under the direction of our Board of Directors or a committee thereof, to make grants of stock options, restricted and unrestricted stock and other stock-based awards to employees, including our executive officers, consultants and directors. On June 28, 2024, our shareholders approved an increase of shares available under the 2019 Plan, which now provides for the aggregate issuance of 800,000shares of our common stock. At September 30, 2024, we have 353,641shares available for future grants.
Stock Compensation Expense
We recorded stock-based compensation expense for the three and nine months ended September 30, 2024 and 2023 as follows:
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Research and development | $ | 54,018 | $ | 76,626 | $ | 130,722 | $ | 286,152 | ||||||||
General and administrative | 100,173 | 66,268 | 343,744 | 517,369 | ||||||||||||
Total | $ | 154,191 | $ | 142,894 | $ | 474,466 | $ | 803,521 |
Stock Options
Stock options to purchase 4,245shares of common stock with a weighted-average exercise price of $336.00expired during the nine months ended September 30, 2024. At September 30, 2024, we had outstanding and exercisable options for the purchase of 2,747shares with a weighted average exercise price of $409.09and a weighted average remaining contractual life of 3.9years. At September 30, 2024, we did not have any unrecognized stock-based compensation expense related to our granted stock options.
Restricted Stock Awards
During the nine months ended September 30, 2024, we vested 1,250Restricted Stock Awards ("RSAs") with a weighted average grant-date fair value of $9.26per share. We had noRSAs outstanding at September 30, 2024.
10 |
Restricted Stock Units
Activity with respect to our Restricted Stock Units ("RSUs") during the nine months ended September 30, 2024 was as follows:
Number of shares |
Weighted- average grant-date fair value per share |
|||||||
Outstanding at January 1, 2024 | 222,722 | $ | 45.82 | |||||
Granted | 192,026 | 1.63 | ||||||
Forfeited | (13,750 | ) | 70.47 | |||||
Issued | (16,199 | ) | 109.35 | |||||
Outstanding at September 30, 2024 | 384,799 | 20.21 | ||||||
Vested and unissued | 144,450 | 44.89 | ||||||
Unvested at September 30, 2024 | 240,349 | $ | 5.38 |
On June 28, 2024, we granted RSUs for the future issuance of 39,202shares of common stock to our employees which vest accordingly: RSUs for the future issuance of 14,969shares of common stock vest on January 1, 2025; RSUs for the future issuance of 18,173shares of common stock vest over a three-year period upon meeting service requirements; RSUs for the future issuance of 3,030shares of common stock vested upon grant due to regaining Nasdaq compliance; and RSUs for the future issuance of 3,030shares of common stock vest upon dosing the first patient in our Phase 2 study in NGC-Cap.
On July 16, 2024, Russell Skibsted was appointed as our Chief Financial Officer ("CFO"). In addition to cash compensation, the Compensation Committee awarded RSUs for the future issuance of 28,000shares of common stock to Mr. Skibsted, which vest accordingly: 14,000vest on July 16, 2025; 7,000vest upon reaching a market capitalization (i.e. total value of Processa's outstanding shares of stock at the then current market price) of at least $30million; and 7,000vest upon receipt of cumulative financing(s) of at least $15million.
On September 3, 2024, RSUs for the future issuance of 124,824shares of common stock were granted to our independent directors and vest on the earlier of June 28, 2025 or the next annual shareholder meeting.
At September 30, 2024, unrecognized stock-based compensation expense of approximately $613,000for RSUs is expected to be fully recognized over a weighted average period of 0.9years. The unrecognized expense excludes approximately $432,000of expense related to certain grants of RSUs with performance milestones that are not probable of occurring at this time.
Holders of our vested RSUs will be issued shares of our common stock upon meeting the distribution restrictions contained in their Restricted Stock Unit Award Agreement. The distribution restrictions are different (longer) than the vesting schedule, imposing an additional restriction on the holder. Unlike RSAs, while certain employees may hold fully vested RSUs, the individual does not hold any shares or have any rights of a shareholder until the distribution restrictions are met. Upon distribution to the employee, each RSU converts into one share of our common stock. The RSUs contain dividend equivalent rights.
Warrants
During the nine months ended September 30, 2024, we did not grant any warrants to purchase shares of our common stock other than warrants to purchase 1,617,777shares of common stock as part of the Offering (see Note 2). Warrants to purchase 7,500shares of our common stock expired unexercised. We also repurchased a warrant issued to a consultant in 2023 for the purchase of 15,000shares of our common stock in exchange for a payment of $10,000.
At September 30, 2024, we had outstanding warrants for the purchase of 1,775,784shares of our common stock with a weighted average exercise price of $5.95and a weighted average remaining contractual life of 4.0years. All the outstanding warrants are exercisable as of September 30, 2024. We did not have any unrecognized stock-based compensation expense related to our granted warrants at September 30, 2024.
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Note 4 - Net Loss per Share of Common Stock
Net Loss Per Share
Basic net loss per share is computed by dividing our net loss available to common shareholders by the weighted average number of shares of common stock outstanding (which excludes unvested RSAs and includes vested RSUs) during the period. Diluted loss per share is computed by dividing our net loss available to common shareholders by the diluted weighted average number of shares of common stock (which includes the potentially dilutive effect of stock options, unvested RSAs, unvested RSUs and warrants) during the period. Since we experienced a net loss for all periods presented, basic and diluted net loss per share are the same. As such, diluted loss per share for the three and nine months ended September 30, 2024 and 2023 excludes the impact of potentially dilutive common shares since those shares would have an anti-dilutive effect on net loss per share.
The computation of net loss per share for the three and nine months ended September 30, 2024 and 2023 was as follows:
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Basic and diluted net loss per share: | ||||||||||||||||
Net loss available to common stockholders | $ | (3,384,703 | ) | $ | (2,081,951 | ) | $ | (9,121,410 | ) | $ | (8,716,589 | ) | ||||
Weighted average number of common shares-basic and diluted | 3,275,998 | 1,350,188 | 2,909,941 | 1,279,298 | ||||||||||||
Basic and diluted net loss per share | $ | (1.03 | ) | $ | (1.54 | ) | $ | (3.13 | ) | $ | (6.81 | ) |
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Weighted-average number of common shares outstanding - basic and diluted | 3,118,029 | 1,224,255 | 2,767,647 | 1,151,425 | ||||||||||||
Weighted-average number of vested RSUs- basic and diluted | 157,969 | 125,933 | 142,294 | 127,873 | ||||||||||||
Weighted-average number of common shares-basic and diluted | 3,275,998 | 1,350,188 | 2,909,941 | 1,279,298 |
Our diluted net loss per share for the three and nine months ended September 30, 2024 and 2023 excluded 2,018,880and 289,936of potentially dilutive common shares, respectively, related to outstanding stock options, warrants and unvested restricted stock since those shares would have had an anti-dilutive effect on net loss per share during the periods then ended.
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Note 5 - Leases
We lease our office space under an operating lease agreement. This lease does not have significant rent escalation, concessions, leasehold improvement incentives, or other build-out clauses. Further, the lease does not contain contingent rent provisions. Our office space lease includes both lease (e.g., fixed payments including rent, taxes, and insurance costs) and non-lease components (e.g., common-area or other maintenance costs), which are accounted for as a single lease component as we have elected the practical expedient to group lease and non-lease components for all leases. We also lease office equipment under a financing lease. Our leases do not provide an implicit rate and, as such, we have used our incremental borrowing rate of 8% in determining the present value of the lease payments based on the information available at the lease commencement date.
Lease costs included in our condensed consolidated statements of operations totaled approximately $23,000and $24,000for the three months ending September 30, 2024 and 2023, respectively, and approximately $68,000and $73,000for the nine months ended September 30, 2024, and 2023, respectively. The weighted average remaining lease terms and discount rate for our leases were as follows at September 30, 2024:
Remaining lease term (years) for our facility lease | 1.0 | |||
Remaining lease term (years) for our equipment lease | 1.4 | |||
Weighted average discount rate for our facility and equipment leases | 8.0 | % |
Annual lease liabilities for the operating lease were as follows at September 30, 2024:
2024 | $ | 23,347 | ||
2025 | 70,040 | |||
Total lease payments | 93,387 | |||
Less: Interest | (4,610 | ) | ||
Present value of lease liabilities | 88,777 | |||
Less: current maturities | (88,777 | ) | ||
Non-current lease liability | $ | - |
Annual lease liabilities for the financing lease were as follows at September 30, 2024:
2024 | $ | 1,616 | ||
2025 | 6,820 | |||
2026 | 488 | |||
Total lease payments | 8,924 | |||
Less: Interest | (857 | ) | ||
Present value of lease liabilities | 8,067 | |||
Less: current maturities | (5,899 | ) | ||
Non-current lease liability | $ | 2,168 |
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Note 6 - Related Party Transactions
CorLyst, LLC ("CorLyst") reimburses us for shared costs related to payroll, health insurance and rent based on actual costs incurred, which are recognized as a reduction of our general and administrative operating expenses being reimbursed in our condensed consolidated statement of operations. We recorded approximately $33,000and $26,000of reimbursements during the three months ended September 30, 2024 and 2023, respectively, and approximately $83,000and $90,000for the nine months ended September 30, 2024 and 2023, respectively. Noamounts were due from CorLyst at September 30, 2024 or 2023. Our President of Research and Development is the CEO of CorLyst, and CorLyst is a shareholder.
Note 7 - Commitments and Contingencies
Purchase Obligations
We enter into contracts in the normal course of business with contract research organizations ("CROs") and subcontractors to further develop our products. The contracts are cancelable, with varying provisions regarding termination. If we terminated a cancelable contract with a specific vendor, we would only be obligated for products or services that we received at the effective date of the termination and any applicable cancellation fees. At September 30, 2024, we are contractually committed to pay up to $13.0million of future services under these cancelable contracts with the CROs. Our actual contractual obligations will also vary depending on the progress and results of the remaining clinical trials.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation
Forward Looking Statements
This Quarterly Report on Form 10-Q contains "forward-looking statements" that reflect, when made, the Company's expectations or beliefs concerning future events that involve risks and uncertainties. Forward-looking statements frequently are identified by the words "believe," "anticipate," "expect," "estimate," "intend," "project," "will be," "will continue," "will likely result," or other similar words and phrases. Similarly, statements herein that describe the Company's objectives, plans or goals also are forward-looking statements. Actual results could differ materially from those projected, implied or anticipated by the Company's forward-looking statements. Some of the factors that could cause actual results to differ include: our limited operating history, limited cash and history of losses; our ability to achieve profitability; our ability to obtain adequate financing to fund our business operations in the future; our ability to secure required FDA or other governmental approvals for our product candidates and the breadth of the indication sought; the impact of competitive or alternative products, technologies and pricing; whether we are successful in developing and commercializing our technology, including through licensing; the adequacy of protections afforded to us and/or our licensors by the anticipated patents that we own or license and the cost to us of maintaining, enforcing and defending those patents; our and our licensors' ability to protect non-patented intellectual property rights; our exposure to and ability to defend third-party claims and challenges to our and our licensors' anticipated patents and other intellectual property rights; and our ability to continue as a going concern. For a discussion of these and all other known risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, which is available on the SEC's website at www.sec.gov. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update this Quarterly Report on Form 10-Q to reflect events or circumstances after the date hereof.
For purposes of this Management's Discussion and Analysis of Financial Condition and Results of Operations, references to the "Company," "we," "us" or "our" refer to the operations of Processa Pharmaceuticals, Inc. and its direct and indirect subsidiaries for the periods described herein.
Overview
We are a clinical-stage biopharmaceutical company focused on utilizing our Regulatory Science Approach, which includes the principles associated with FDA's Project Optimus Oncology initiative and the related FDA Draft Guidance, in the development of Next Generation Chemotherapy ("NGC") oncology drug products. Our mission is to provide better treatment options than those that presently exist by extending a patient's survival and/or improving a patient's quality of life. This is achieved by improving upon FDA-approved, widely used oncology drugs or the cancer-killing metabolites of these drugs by altering how they are metabolized and/or distributed in the body, including how they are distributed to the actual cancer cells.
Our Regulatory Science Approach was conceived in the early 1990s when the founders of Processa and other faculty at the University of Maryland worked with the FDA to develop multiple FDA Guidance Documents. Regulatory science is the science of developing new tools, standards, and approaches to assess the safety, efficacy, quality, and performance of all FDA-regulated products. Over the last 30 years, two of our founders, Dr. David Young and Dr. Sian Bigora, have expanded the original regulatory science concept by adding focused pre-clinical and clinical studies to justify the benefit-risk assessment required for FDA approval when designing the development programs of new drug products.
Our Regulatory Science Approach identifies the scientific information that the FDA requires to determine whether the benefit outweighs the risk of a drug in a specific population of patients and at a specific dosage regimen for a specific drug product. The studies are designed to obtain the necessary scientific information to support the regulatory decision.
Recently, the FDA has taken steps to define some of the regulatory science required for the FDA approval of oncology products. Through the FDA's Project Optimus Oncology Initiative and the related Draft Guidance on determining the "optimal" dosage regimen for an oncology drug, the FDA has chosen to make the development of oncology drugs more science-based than in the past. Since the principles of the FDA's Project Optimus and the related Draft Guidance have been used by our Regulatory Science Approach in a number of non-oncology drugs in the past, our experience with the principles of Project Optimus differentiates us from other biotechnology companies by focusing us not only on the clinical science, but also on the equally important regulatory process. We believe utilizing our Regulatory Science Approach provides us with three distinct advantages:
● | greater efficiencies (e.g., the right trial design and trial readouts); | |
● | greater possibility of drug approval by the FDA or other regulatory authorities; and | |
● | greater ability to evaluate the benefit-risk of a drug compared to existing therapy, which allows prescribers to provide better treatment options for each patient. |
Our strategic prioritization is to advance our pipeline of NGC proprietary small molecule oncology drugs. The NGC products are new chemical entities that change the metabolism, distribution and/or elimination of already FDA-approved cancer drugs, or their active metabolites, while maintaining the drug's proven mechanism of action in killing cancer cells. We believe our NGC treatments will provide improved safety-efficacy profiles when compared to their currently marketed counterparts - capecitabine, gemcitabine, and irinotecan.
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Our Drug Pipeline
Our pipeline currently consists of NGC-Cap, NGC-Gem and NGC-Iri (also identified as PCS6422, PCS3117 and PCS11T, respectively) and two non-oncology drugs (PCS12852 and PCS499). The non-oncology drugs are not included in the pipeline chart above, as we are seeking partners to continue their clinical and commercial development. A summary of each drug is provided below.
Next Generation Chemotherapy
Historically, much of oncology drug development has searched for novel or different ways to treat cancer. Our approach is to take three current FDA-approved cancer drugs, e.g. capecitabine, gemcitabine and irinotecan, and modify and improve how the human body metabolizes and/or distributes these NGC treatments compared to their presently approved counterpart chemotherapy drugs while maintaining the cancer-killing mechanism of action; thus, our reason for calling our drugs Next Generation Chemotherapy treatments. Part of the development includes determining the optimal dosage regimen based on the dose-response relationship as described in the FDA's Project Optimus Initiative and Draft Optimal Dosage Regimen Oncology Guidance. To date, we have data that we believe suggests our NGC treatments are likely to have much better safety-efficacy profiles than the current widely used marketed counterpart drugs, not only potentially making the development and approval process more efficient, but also clearly differentiating our NGC treatments from the existing treatment. We believe our NGC treatments have the potential to extend the survival and/or quality of life for more patients diagnosed with cancer while decreasing the number of patients who are required to dose-adjust or discontinue treatment because of side effects or lack of response.
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Next Generation Chemotherapy Pipeline
● | Next Generation Capecitabine ("NGC-Cap") is a combination of PCS6422 and a lower dose of the FDA-approved cancer drug capecitabine. PCS6422 is an orally administered irreversible inhibitor of the enzyme dihydropyrimidine dehydrogenase ("DPD"). DPD metabolizes 5-Fluorouracil ("5-FU"), the major metabolite of capecitabine and widely used itself as an intravenous chemotherapeutic agent in many types of cancer, to multiple metabolites classified as catabolites. These catabolites do not have any cancer-killing properties but frequently cause dose-limiting side effects that may require dose adjustments or discontinuation of therapy. |
Capecitabine, as presently prescribed and FDA-approved, forms the cancer drug 5-FU which is then further metabolized to anabolites (which kill both cancer cells and normal duplicating cells) and catabolites (which cause side effects and have no cancer killing properties). When capecitabine is given in combination with PCS6422 in NGC-Cap, PCS6422 significantly changes the metabolism of 5-FU, which results in a change in the distribution of 5-FU within the body. Due to this change in metabolism and the overall metabolite profile of anabolites and catabolites, the side effect and efficacy profile of NGC-Cap has been found to be different from capecitabine given without PCS6422. Since the potency of NGC-Cap is also greater than FDA-approved capecitabine based on the 5-FU systemic exposure per mg of capecitabine administered, the amount of capecitabine anabolites formed from 1 mg of capecitabine administered in NGC-Cap will, therefore, be much greater than formed from the administration of 1 mg of existing capecitabine. | ||
The Phase 1B trial in patients with advanced refractory gastrointestinal tract tumors demonstrated that the irreversible inhibition of DPD by PCS6422 could alter the metabolism, distribution and elimination of 5-FU, making NGC-Cap significantly (up to 50 times) more potent than capecitabine alone and potentially leading to higher levels of anabolites which can kill replicating cancer and normal cells. By administering NGC-Cap to cancer patients, the balance between anabolites and catabolites changes depending on the dosage regimens of PCS6422 and capecitabine used, making the efficacy-safety profile of NGC-Cap different than that of FDA-approved capecitabine and requiring further evaluation of the PCS6422 and capecitabine regimens to determine the optimal NGC-Cap regimens for patients. |
In order for NGC-Cap to provide a safer and more efficacious profile for cancer patients compared to existing chemotherapy, understanding how the different regimens of PCS6422 and capecitabine may affect the systemic and tumor exposure to the anabolites, as well as the systemic exposure to the catabolites, is required. This can be achieved by following the timeline of DPD irreversible inhibition and the formation of new DPD using the plasma concentrations of 5-FU and its catabolites. | ||
In an effort to better estimate the timeline of DPD inhibition and formation of new DPD, we modified the protocol for the Phase 1B trial and began enrolling patients in the amended Phase 1B trial in April 2022. On November 1, 2022, we announced that data from the Phase 1B trial identified multiple dosage regimens with potentially better safety and efficacy profiles than currently existing chemotherapy regimens. Since 5-FU exposure is dependent on both the PCS6422 regimen and the capecitabine regimen, safe regimens were identified as well as regimens that cause dose-limiting toxicities ("DLTs"). One of the early regimens in the Phase 1B trial did cause DLTs in two patients, one of whom died. No other DLTs were noted in the study. The Phase 1B trial has completed enrollment. Although the primary objective of the NGC-Cap Phase 1B trial in patients with advanced, progressive cancer was to evaluate safety, the Phase 1B trial showed that treatment with NGC-Cap resulted in both a much greater efficacy response rate and a longer period of progression-free survival than what has been reported for capecitabine. In all evaluable progressive disease patients receiving PCS6422 and seven days of capecitabine, partial response and stable disease were observed in 66.7% (8 out of 12) of the evaluable patients, including two with partial response and six with stable disease. The length of progression-free survival was approximately five to 11 months across these patients. By comparison, in the capecitabine product label, 301 metastatic colorectal cancer patients treated with monotherapy capecitabine had an overall response rate of approximately 21% and the time to progression of approximately 4.5 months. In addition, even with up to 10x greater exposure to its 5-FU cancer treatment metabolite than capecitabine, only one patient on NGC-Cap had a mild case of hand-foot syndrome, meaning the hand-foot syndrome rate in our Phase 1B trial was 6% versus the expected ~50% based upon published data. Other side effects, even with 10x greater exposure, were similar or better than seen with capecitabine as approved by FDA. Based on communications and meetings with the FDA, we submitted a new IND for the treatment of advanced and metastatic breast cancer and received IND clearance from the FDA on July 24, 2024. The Phase 2 trial has been initiated and will be a global multicenter, open-label, adaptive design trial comparing two different doses of NGC-Cap to FDA-approved monotherapy capecitabine in approximately 60 to 90 patients with advanced or metastatic breast cancer. The trial is designed to evaluate the safety-efficacy profile of NGC-Cap versus monotherapy capecitabine, to determine the potential optimal dosage regimens of NGC-Cap as required by the FDA Project Optimus Initiative. Our license agreement with Elion for NGC-Cap requires us to use commercially reasonable efforts, at our sole cost and expense, to research, develop and commercialize products in one or more countries, including meeting specific diligence milestones that include dosing a first patient with a product in a Phase 2 or 3 clinical trial on or before October 6, 2024. On October 2, 2024, the first patient in our Phase 2 trial of NGC-Cap was dosed. |
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● | NGC-Gem is a cytidine analog similar to gemcitabine (Gemzar®), but different enough in chemical structure that some patients are more likely to respond to PCS3117 than gemcitabine. In addition, we believe those patients inherently resistant or who acquire resistance to gemcitabine are likely not to be resistant to NGC-Gem. The difference in response occurs because NGC-Gem is metabolized to its active metabolite through a different enzyme system than gemcitabine. The Phase 2A trial in patients with relapsed or refractory pancreatic cancer was completed by Ocuphire prior to us licensing NGC-Gem. We plan to meet with the FDA to discuss potential trial designs including implementation of the Project Optimus initiative as part of the design. Similar to NGC-Cap, we will need to obtain additional funding before we can begin any future trial for NGC-Gem. |
Our license agreement with Ocuphire Pharma, Inc. ("Ocuphire") for NGC-Gem requires us to use commercially reasonable efforts, at our sole cost and expense to oversee such commercialization efforts, to research, develop and commercialize products in one or more countries, including meeting specific diligence milestones that consist of: (i) dosing a patient in a clinical trial prior to June 16, 2024; and (ii) dosing a patient in a pivotal clinical trial or in a clinical trial for a second indication of the drug prior to June 16, 2026. We are currently in discussions with Ocuphire to extend these deadlines. | ||
● | NGC-Iri is an analog of SN38 (SN38 is the active metabolite of irinotecan) and should have an improved safety/efficacy profile in every type of cancer that irinotecan is presently used. The manufacturing process and sites for drug substance and drug product are presently being evaluated and IND-enabling toxicology studies will then be initiated. A preclinical study in mouse xenograft models showed that after PCS11T administration, there was greater accumulation of SN-38 in the tumor compared with other tissues than after irinotecan or Onivyde® administration. Additionally, less SN-38 accumulated in non-cancer tissues, such as muscle, after NGC-Iri administration than after irinotecan or Onivyde® administration, supporting the potential for a better NGC-Iri safety profile. We are defining the potential paths to approval, which include defining the targeted patient population and the type of cancer. In 2025, we plan to expand the preclinical analysis, including additional preclinical efficacy and toxicity studies; evaluate manufacturing options for PCS11T; and conduct chemistry, manufacturing and control (CMC) activities and pre-IND enabling studies. |
We are focused on drug products that improve the survival and/or quality of life for patients by improving the safety and/or efficacy of the drug in a targeted patient population, while providing a more efficient and probable path to FDA approval and differentiating our drugs from those on the market or are currently being developed.
Other Drugs in Our Pipeline
In 2023, we completed our Phase 2A trial for PCS12852 in gastroparesis patients with positive results. Additionally, in February 2023, due primarily to the inability to identify and enroll patients in our rare disease Phase 2 trial for PCS499 in ulcerative Necrobiosis Lipoidica, we decided to cease further enrollment in the PCS499 trial and terminated the trial. We did not experience any safety concerns during the conduct of either the PCS12852 or PCS499 trial. We continue to evaluate options to monetize these non-core drug assets, which may include out-licensing or partnering these assets with one or more third parties. We are currently in discussions with Yuhan to amend our existing license agreement for PCS12852.
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Recent Developments
Reverse Stock Split
On January 22, 2024, we effected a 1-for-20 reverse stock split, reducing the number of our common shares issued on that date from 24,706,474 shares to 1,291,000 shares. There is no corresponding reduction in the number of authorized shares of common stock and no change in the par value per share. All share and per share amounts and conversion and exercise prices presented herein have been adjusted retroactively to reflect this change.
Public Offering
On January 30, 2024, we raised gross proceeds of $7.0 million (net proceeds of $6.3 million) from the sale of 476,000 shares of our common stock, pre-funded warrants to purchase up to 1,079,555 shares of our common stock and warrants to purchase 1,555,555 shares of our common stock in a public offering, as described in Note 2. Simultaneously with the closing of the sale, the pre-funded warrants were exercised in exchange for 1,079,555 shares of our common stock. We are using the net proceeds from this financing for continued research and development for NCG-Cap, and working capital and general corporate purposes.
ATM Offering
In May 2024, we filed with the SEC a registration statement on Form S-3 (Registration No. 333-279588) (the "Registration Statement"), including a base prospectus relating to the offering of up to $50,000,000 in the aggregate of the securities identified in the base prospectus from time to time in one or more offerings; and a prospectus supplement relating to the shares of our common stock that may be issued and sold under a sales agreement dated May 21, 2024 (the "Sales Agreement") between us and A.G.P./Alliance Global Partners (the "Sales Agent"), through which we may issue and sell in a registered "at the market offering" shares of our common stock having an aggregate offering price of up to $2.4 million (subject to adjustment) from time to time through or to our Sales Agent (the "ATM Offering"). We expect to use net proceeds, if any, from the ATM Offering over time for continued research and development for our portfolio of drug candidates, especially our oncology products, and working capital and general corporate purposes. The shares under the ATM Offering will be sold and issued pursuant to the Registration Statement. On July 31, 2024, we received $931,000 in net proceeds from the sale of 374,190 shares of common stock under the ATM Offering.
New Chief Financial Officer
On July 16, 2024, Russell Skibsted was appointed as our Chief Financial Officer ("CFO") after the retirement of our previous CFO. Mr. Skibsted has nearly 30 years of experience in the pharmaceutical industry, including expertise in financial management, global business development, capital markets, investor relations and operations. In connection with his employment, Mr. Skibsted will be paid an annual base salary of $400,000 and will be eligible for a $50,000 base salary increase upon a cumulative (one or multiple) financing of at least $15 million that he leads and substantially participates in. He is also eligible to participate in an executive bonus pool with a target bonus of 35% of his base compensation. In addition, the Compensation Committee awarded 28,000 RSUs to Mr. Skibsted, which vest accordingly: 14,000 RSUs vest on July 16, 2025; 7,000 RSUs vest upon Processa reaching a market capitalization (i.e. total value of Processa's outstanding shares of stock at the then current market price) of at least $30 million; and 7,000 RSUs vest upon receipt of cumulative financing(s) of at least $15 million. He will also be eligible for other benefits as described in his employment agreement.
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Results of Operations
Comparison of the three and nine months ended September 30, 2024 and 2023
The following table summarizes our net loss during the periods indicated:
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
2024 | 2023 | Change | 2024 | 2023 | Change | |||||||||||||||||||
Operating Expenses | ||||||||||||||||||||||||
Research and development expenses | $ | 2,287,525 | $ | 1,151,740 | $ | 1,135,785 | $ | 5,556,694 | $ | 4,478,793 | $ | 1,077,901 | ||||||||||||
General and administrative expenses | 1,137,328 | 1,015,872 | 121,456 | 3,759,781 | 4,508,818 | (749,037 | ) | |||||||||||||||||
Operating Loss | (3,424,853 | ) | (2,167,612 | ) | (9,316,475 | ) | (8,987,611 | ) | ||||||||||||||||
Other Income, net | 40,150 | 85,661 | (45,511 | ) | 195,065 | 271,022 | (75,957 | ) | ||||||||||||||||
Net Operating Loss Before Income Tax Benefit | (3,384,703 | ) | (2,081,951 | ) | (1,302,752 | ) | (9,121,410 | ) | (8,716,589 | ) | (404,821 | ) | ||||||||||||
Income Tax Benefit | - | - | - | - | - | - | ||||||||||||||||||
Net Loss | $ | (3,384,703 | ) | $ | (2,081,951 | ) | $ | (9,121,410 | ) | $ | (8,716,589 | ) |
Revenues
We do not currently have any revenue under contract or any immediate sales prospects.
Research and Development Expenses
Our research and development costs are expensed as incurred. Research and development expenses include (i) program and testing related expenses including external consulting and professional fees related to the product testing and our development activities and (ii) internal research and development staff salaries and other payroll costs including stock-based compensation, payroll taxes and employee benefits.
Costs for the three- and nine-month periods for the periods ended September 30, 2024 and 2023 were as follows:
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2024 | 2023 | 2024 | 2023 | |||||||||||||
Research and development salaries and benefits | $ | 436,713 | $ | 448,071 | $ | 1,412,881 | $ | 1,480,909 | ||||||||
Preclinical, clinical trial and other costs | 1,850,812 | 703,669 | 4,143,813 | 2,997,884 | ||||||||||||
Total | $ | 2,287,525 | $ | 1,151,740 | $ | 5,556,694 | $ | 4,478,793 |
During the three months ended September 30, 2024, our preclinical, clinical trial and other costs increased when compared to the same period in 2023. This was attributable to an increase of approximately $1.3 million for ongoing testing and related expenses related to our Phase 1B trial for NGC-Cap and the IND/initiation of our Phase 2 trial for NGC-Cap and offset by a decrease in professional fees of approximately $181,000, mostly attributable to a decrease in patent-related legal fees. During the same period in 2023, in addition to clinical trial costs for NGC-Cap, we were incurring closing costs in our clinical trial for PCS12852 and PCS499. We also had an approximately $11,000 increase in salaries and related costs during the three months ended September 30, 2024 when compared to the same period in 2023, due to one-time bonuses and increased salary rates for the research and development team in 2024. This was offset by a decrease in stock-based compensation of approximately $23,000.
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During the nine months ended September 30, 2024, we had increases in testing and related expenses of approximately $1.5 million and in salaries and related costs of approximately $87,000, when compared to the same period in 2023. These increases were offset by decreases in professional fees of approximately $315,000 and in stock-based compensation of approximately $155,000. The reasons for the changes between the nine-month periods in 2024 and 2023 are the same as the reasons between the three-month periods in 2024 and 2023.
On July 24, 2024, we received approval of our IND for our Phase 2 trial for NGC-Cap in breast cancer. On October 2, 2024, we dosed the first patient in the study. As we continue this Phase 2 trial and complete our Phase 1B clinical trial for NGC-Cap, we anticipate our research and development costs will increase. We will also continue incurring nominal costs for NGC-Gem as we prepare to meet with the FDA to discuss potential study designs and for NGC-Iri as we prepare to further define the clinical development program, GMP CMC processes and the IND-enabling toxicology studies.
The funding necessary to bring a drug candidate to market is subject to numerous uncertainties. Once a drug candidate is identified, the further development of that drug candidate may be halted or abandoned at any time due to a number of factors. These factors include, but are not limited to, funding constraints, safety or a change in market demand. For each of our drug candidate programs, we periodically assess the scientific progress and merits of the programs to determine if continued research and development is economically viable. Some programs may be terminated due to the lack of scientific progress and lack of prospects for ultimate commercialization.
Our clinical trial cost accruals are based on estimates of patient enrollment and related costs at clinical investigator sites, as well as estimates for the services received and efforts expended pursuant to contracts with multiple research institutions and CROs that conduct and manage clinical trials on our behalf.
We estimate preclinical and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on our behalf. In accruing service fees, we estimate the time period over which services will be performed and the level of patient enrollment and activity expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, we will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses and expensed when the services are rendered.
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General and Administrative Expenses
Our general and administrative expenses for the three months ended September 30, 2024 increased by approximately $121,000 to $1.1 million from $1.0 million for the three months ended September 30, 2023. This increase was due primarily as a result of an approximately $81,000 increase in employee stock-based compensation; an approximately $12,000 increase in professional fees, mostly attributable to an increase of legal and consulting fees; an approximately $21,000 increase in salaries and other payroll-related costs from increased salary rates, primarily paid to our executive officers; and a net increase of approximately $14,000 in travel, office and other miscellaneous expenses. We also received approximately $7,000 more in reimbursements from CorLyst during the three months ended September 30, 2024 when compared to the same period in 2023.
During the nine months ended September 30, 2024, our general and administrative expenses decreased by approximately $749,000 to $3.8 million from $4.5 million for the nine months ended September 30, 2023. This was due primarily to a decrease in professional fees of approximately $943,000 as a result of a non-recurring expense that was incurred during 2023 in connection with the stock purchase warrant granted to the placement agent for our registered direct offering in February 2023; and a decrease in employee stock-based compensation of approximately $167,000 in 2024. These decreases were primarily offset by increases in salaries and other payroll-related expenses of approximately $303,000 and in office and other related expenses of approximately $51,000. We also received approximately $7,000 less in reimbursements from CorLyst during the nine months ended September 30, 2024 when compared to the same period in 2023.
Other Income, net
Other income represents interest income of approximately $40,000 and $86,000 for the three months ended September 30, 2024 and 2023, respectively, and approximately $195,000 and $271,000 for the nine months ended September 30, 2024 and 2023, respectively.
Income Tax Benefit
We did not recognize any income tax benefit for the three or nine months ended September 30, 2024 or 2023.
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Cash Flows
The following table sets forth our sources and uses of cash and cash equivalents for the nine months ended September 30, 2024 and 2023:
Nine months ended | ||||||||
September 30, | ||||||||
2024 | 2023 | |||||||
Net cash (used in) provided by: | ||||||||
Operating activities | $ | (8,997,321 | ) | $ | (5,939,478 | ) | ||
Investing activities | (3,244 | ) | (2,776 | ) | ||||
Financing activities | 7,185,832 | 6,299,331 | ||||||
Net (decrease) increase in cash | $ | (1,814,733 | ) | $ | 357,077 |
Net cash used in operating activities
We used net cash in our operating activities of $8,997,321 and $5,939,478 during the nine months ended September 30, 2024 and 2023, respectively. The increase in cash used in operating activities was primarily attributable to increased costs related to closing our Phase 1B and commencing our Phase 2 trial for NGC-Cap, including the prepayment of expenses paid to our CRO for the Phase 2 trial; increased salaries and other payroll-related expenses; and professional fees during the nine months ended September 30, 2024.
As we continue our development of NGC-Cap and evaluate the other NGC drugs in our portfolio, we anticipate our research and development efforts and ongoing general and administrative costs will continue to generate negative cash flows from operating activities for the foreseeable future. We anticipate our clinical trial costs will increase when compared to prior periods since we have begun our Phase 2 clinical trial for NGC-Cap and our prior year activities related primarily to the completion of our Phase 1b trial for NGC-Cap.
Net cash used in investing activities
During the nine months ended September 30, 2024 and 2023, we used net cash in our investing activities of $3,244 and $2,776, respectively, to purchase property and equipment.
Net cash provided by financing activities
During the nine months ended September 30, 2024, we sold 476,000 shares of common stock, pre-funded warrants to purchase up to 1,079,555 shares of common stock in lieu of shares of common stock, all of which were exercised into shares of our common stock, and warrants to purchase up to 1,555,555 shares of our common stock pursuant to a public offering for net proceeds of $6.3 million. We also sold 374,190 shares of common stock under our ATM Offering for net proceeds of approximately $931,000. We used cash, classified as financing activities, of approximately $16,000 to pay income taxes owed on stock-based compensation, approximately $9,000 for the settlement of a stock award, and approximately $4,000 for payments owed under a financing lease obligation.
During the nine months ended September 30, 2023, we raised net proceeds of $6.4 million from the sale of 421,611 shares of our common stock.
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Liquidity
We do not have sufficient cash on hand or available to fund our operations for the next twelve months. During the nine months ended September 30, 2024, we began initiation activities for our Phase 2 trial for NGC-Cap in breast cancer. At September 30, 2024, we had cash and cash equivalents totaling $2.9 million. Based on our current business plans, we will need to obtain additional funding from the sale of equity and/or debt securities or complete a strategic transaction or other funding transactions in order to continue our Phase 2 trial of NGC-Cap and conduct future preclinical studies and clinical trials for other drugs in our portfolio.
Absent additional funding, our current cash and cash equivalents will not be sufficient to fund our planned operations for a period of one year or more after the date that these condensed consolidated financial statements were available to be issued based on the timing and amount of our projected net loss from continuing operations and the related amount of cash to be used in operating activities during that period of time. Our ability to execute our longer-term operating plans, including future preclinical studies and clinical trials for our portfolio of drugs depend on our ability to obtain additional funding from the sale of equity and/or debt securities, a strategic transaction or other funding transactions.
We have incurred losses since inception, currently devoting substantially all of our efforts toward research and development of our next generation chemotherapy drug product candidates, including conducting clinical trials and providing general and administrative support for these operations, and have an accumulated deficit of $84.5 million at September 30, 2024. During the nine months ended September 30, 2024, we generated a net loss of $9.1 million and used $9.0 million in net cash for operating activities from continuing operations. To date, none of our drug candidates have been approved for sale, and therefore we have not generated any product revenue and do not expect positive cash flow from operations in the foreseeable future.
We have financed our operations primarily through public equity issuances, including an offering we closed on January 30, 2024 in which we sold 476,000 shares of our common stock, pre-funded warrants to purchase up to 1,079,555 shares of our common stock, and warrants for the purchase of up to 1,555,555 shares of our common stock for net proceeds of $6.3 million, after deducting placement agent fees and offering-related expenses. Simultaneously with the closing of the sale, the pre-funded warrants were exercised in exchange for 1,079,555 shares of our common stock.
Further, in May 2024, we filed with the SEC a registration statement on Form S-3 (Registration No. 333-279588) (the "Registration Statement"), including a base prospectus relating to the offering of up to $50,000,000 in the aggregate of the securities identified in the base prospectus from time to time in one or more offerings; and a prospectus supplement relating to the shares of our common stock that may be issued and sold under a sales agreement dated May 21, 2024 (the "Sales Agreement") between us and A.G.P./Alliance Global Partners (the "Sales Agent"), through which we may issue and sell in a registered "at the market offering" shares of our common stock having an aggregate offering price of up to $2.4 million (subject to adjustment) from time to time through or to our Sales Agent (the "ATM Offering"). We expect to use net proceeds, if any, from the ATM Offering over time for continued research and development for our portfolio of drug candidates, especially our oncology products, and working capital and general corporate purposes. The shares under the ATM Offering will be sold and issued pursuant to the Registration Statement. During the nine months ended September 30, 2024, we received $931,000 in net proceeds from the sale of 374,190 shares of common stock under the ATM Offering on July 31, 2024.
We plan to raise additional funds in the future through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing and distribution arrangements, but will only do so if the terms are acceptable to us. If we are unable to obtain adequate financing when needed, we may have to delay, reduce the scope of, or suspend our current or planned future clinical trial plans, or research and development programs. This may also cause us to not meet obligations contained in certain of our license agreements and put these assets at risk. To the extent that we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our product candidates, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us. If we raise additional capital through public or private equity offerings, the ownership interest of our existing stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect our stockholders' rights. If we raise additional capital through debt financing, we may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or making capital expenditures. There can be no assurance that future funding will be available when needed.
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Contractual Obligations and Commitments
There have been no significant changes to the contractual obligations reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
Off Balance Sheet Arrangements
At September 30, 2024, we did not have any off-balance sheet arrangements.
Critical Accounting Policies and Use of Estimates
Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities.
We believe that the estimates, assumptions and judgments involved in the accounting policies described in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of our most recent Annual Report on Form 10-K have the greatest potential impact on our financial statements, so we consider these to be our critical accounting policies. Actual results could differ from the estimates we use in applying our critical accounting policies. We are not currently aware of any reasonably likely events or circumstances that would result in materially different amounts being reported.
There have been no changes in our critical accounting policies from those included in our most recent Annual Report on Form 10-K.
Recently Issued Accounting Pronouncements
We have evaluated recently issued accounting pronouncements and determined that there is no material impact on our financial position or results of operations.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 3 is not applicable to us as a smaller reporting company and has been omitted.
Item 4. Controls and Procedures
At September 30, 2024, management, with the participation of the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the evaluation of its disclosure controls and procedures, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at September 30, 2024 to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and (ii) accumulated and communicated to our management, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect the Company's internal control over financial reporting.
Part II. Other Information
Item 1. Legal Proceedings
As of the date of this report, to our knowledge, there are no legal proceedings or regulatory actions material to us to which we are a party, or have been a party to, or of which any of our property is or was the subject matter of, and no such proceedings or actions are known by us to be contemplated, except as provided below:
As previously disclosed in our Current report on Form 10-Q for the period ended March 31, 2024, on May 7, 2024, the Company received notification from Elion purporting to terminate the license agreement by and between the Company and Elion as a result of the Company's alleged breach thereof. The Company believes that Elion's claims are without merit and disputes that the license agreement has been validly terminated. On July 5, 2024, the Company filed a complaint seeking monetary damages, declaratory judgement and injunctive relief. On August 14, 2024, the Company received Elion's answer and counterclaims. On October 10, 2024, the Company filed its response to Elion's counterclaims. The Company intends to enforce its rights under the license agreement and will pursue such other remedies as it determines are appropriate.
Item 1A. Risk Factors
There have been no material changes to our risk factors as described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, other than the addition of the following risk factor:
Our licenses are subject to termination by the licensor in certain circumstances.
Our rights to practice the inventions claimed in the licensed patents and patent applications are subject to our licensors abiding by the terms of those licenses and not terminating them. Our licenses may be terminated by the licensor if we are in material breach of certain terms or conditions of the license agreement or in certain other circumstances. Our license agreements each include provisions that allow the licensor to terminate the license if (i) we breach any payment obligation or other material provision under the agreement and fail to cure the breach within a fixed time following written notice of termination; (ii) we or any of our affiliates, licensees or sublicensees directly or indirectly challenge the validity, enforceability, or extension of any of the licensed patents; or (iii) we declare bankruptcy or dissolve. The majority of license agreements require us to satisfy due diligence milestones that relate to the development of new products containing the licensed drug or the agreement may be terminated by such counterparty. Our rights under these licenses are subject to our continued compliance with the terms of the license, including the payment of royalties due under the licenses. Termination of any of these licenses could prevent us from marketing some or all of our products. Because of the complexity of our products and the patents we have licensed, determining the scope of the license and related royalty obligations can be difficult and can lead to disputes between us and the licensor. An unfavorable resolution of such a dispute could lead to an increase in the royalties payable pursuant to the license. If a licensor believed we were not paying the royalties due under the license or were otherwise not in compliance with the terms of the license, the licensor might attempt to revoke the license. If such an attempt were successful, we might be barred from producing and selling some or all of our products.
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As previously disclosed in our Current Report on Form 10-Q for the period ended March 31, 2024, on May 7, 2024, the Company received notification from Elion purporting to terminate the license agreement by and between us and Elion as a result of the Company's alleged breach thereof. The Company believes that Elion's claims are without merit and disputes that the license agreement has been validly terminated. We are now in litigation regarding our license agreement. The Company intends to enforce its rights under the license agreement and will pursue such other remedies as it determines are appropriate.
If we are unsuccessful or are unable to enforce our rights under the license agreement, our business and results of operations may be adversely affected.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
(a) Recent Sale of Unregistered Securities
During the three months ended September 30, 2024, we issued 20,000 shares of common stock to Paramount Advisors, LLC in connection with a consulting agreement. The sale of shares was exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), in reliance on Section 4(a)(2) of the Securities Act.
There were no other sales of unregistered securities during the three months ended September 30, 2024.
(b) Use of Proceeds from Public Offering of Common Stock
None.
(c) Issuer Purchases of Equity Securities
We did not repurchase any shares of our common stock during the nine months ended September 30, 2024.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
During the three months ended September 30, 2024, none of our directors or officers adoptedor terminateda "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.
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Item 6. Exhibits
SEC Ref. No. | Title of Document | |
10.1# | Employment Agreement dated July 16, 2024 by and between Russell Skibsted and Processa Pharmaceuticals, Inc. (incorporated by reference to Exhibit 10.1 to Form 8-K filed on July 17, 2024) | |
31.1* | Rule 153-14(a) Certification by Principal Executive Officer | |
31.2* | Rule 153-14(a) Certification by Principal Financial Officer | |
32.1*++ | Section 1350 Certification of Principal Executive Officer and Principal Financial Officer | |
99.1 | XBRL Files | |
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 (embedded within the Inline XBRL document) |
* Filed herewith.
# Indicates management contract or compensatory plan or arrangement.
++ This certification is being furnished solely to accompany this Quarterly Report pursuant to 18 U.S.C. Section 1350 and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
PROCESSA PHARMACEUTICALS, INC. | ||
By: | /s/ George Ng | |
George Ng | ||
Chief Executive Officer | ||
(Principal Executive Officer) | ||
Dated: October 30, 2024 |
By: | /s/ Russell Skibsted | |
Russell Skibsted | ||
Chief Financial Officer | ||
(Principal Financial and Accounting Officer) | ||
Dated: October 30, 2024 |
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