SHELTON, CONNECTICUT — Monday, February 24, 2020 — NanoViricides, Inc. (NYSE Amer.: NNVC) (the “Company”), a global leader in the development of highly effective antiviral therapies based on a novel nanomedicines platform (the “Company”), has filed its quarterly report for its second quarter of financial year 2020 in a timely manner with the Securities and Exchange Commission. This press release should be read in conjunction with the Form 10-Q filed on February 14, 2020. The submission can be downloaded from the SEC website at: https://www.sec.gov/Archives/edgar/data/1379006/000110465920021930/tm205411-1_10q.htm.
The Company reported that it had approximately $1.0 Million (M) of current assets (cash, cash equivalents, and prepaid expenses), and current cash liabilities of approximately $1.4M excluding a recent mortgage (described below), as of December 31, 2019, the end of the reporting period. The net cash used in operating activities during the six months period was approximately $2.56M. The Company’s expenditures were in line with budget estimates. Shareholder equity stood at approximately $7.72M for the quarter (unaudited figures), primarily due to the asset value of its cGMP-capable manufacturing facility, R&D labs, and equipment, that it owns fully except for a $2 Million secured debt provision. The Company had no revenues. The Company has no long term debt.
The Company drew down $1.1M from a $2M non-convertible loan commitment secured by a mortgage on the Company’s facility provided by the Company’s founder and President, Anil R. Diwan, PhD. The mortgage is payable in full on March 31, 2021, with no payments due until then. Interest is payable only on amounts drawn by the Company.
In subsequent events, the Company has previously reported that it has raised approximately $8.625M in gross proceeds in an underwritten public offering, pursuant to an effective Form S-1 registration statement, comprising the sale of 2.5 million shares plus 375,000 shares of an underwriters over-allotment option at a price of $3 per share, with no warrants issued in the transaction. Aegis Capital Corp. acted as sole bookrunner for the offering. The net proceeds to the Company after underwriter’s commission and agreed upon customary fees and expenses were approximately $7.78 million, before deducting the Company’s legal and accounting expenses related to the Offering.
With these cash inflows, the Company believes it has sufficient funding for its planned expenditures for the ensuing year, based on estimated budgets including costs of certain clinical trials. In subsequent events, the Company previously reported that it is working on developing a therapeutic drug for the treatment of the novel coronavirus 2019-nCoV, aka COVID-19. In 2014, the Company had engaged in drug discovery efforts against MERS coronavirus. The Company has reported that it has already found broad-spectrum virus-binding ligands that are expected to attack the virus at the same points that the virus uses to bind to its cognate cellular receptor, namely ACE-2 (angiotensin converting enzyme type 2), using molecular modeling based on known SARS-CoV and ACE2 interactions. COVID-19 shares significant similarity with, and uses the same cellular receptor as, SARS-CoV. The Company intends to perform initial testing of these drug candidates for safety and effectiveness in cell culture studies in its own BSL-2 virology laboratory at its Shelton campus, using low-threat coronavirus strains that have been normally circulating in human population. The Company is working on developing necessary collaborations to take the program further should an effective drug candidate be identified. However, there can be no assurance that the Company will be successful in entering into such collaborations or that such collaborations will lead to an effective drug candidate. The Company does not currently have a license for the coronavirus field from TheraCour Pharma, Inc. (“TheraCour”), the licensor of the Company’s pharmaceutical candidates and a significant shareholder. Customarily, the Company enters into licensing agreements with TheraCour after a potential drug candidate is demonstrated to be likely effective against the virus. TheraCour has not previously denied any licenses sought by the Company.
The Company has experience developing broad-spectrum cellular receptor mimetics as virus-binding ligands for creating nanoviricide drugs. The Company has demonstrated this capability notably in its HerpeCide™ program, wherein nanoviricides based on the same antiviral ligand were found to be effective against at least three different kinds of herpesviruses, namely herpes simplex-1 (HSV-1), herpes simplex-2 (HSV-2), and, surprisingly, the non-simplex varicella zoster virus (VZV).
It is well recognized that development of vaccines takes a long time, and that vaccines can often be ineffective against viruses due to viral mutations that lead to emergence of resistant strains. It is also well recognized and well documented that monoclonal antibodies as antiviral drugs are very difficult to develop and often lead to emergence of resistant viral strains due to viral mutations.
In contrast, the Company believes that, its nanoviricide biomimetic technology platform has the potential to develop broad-spectrum antiviral drugs that viruses may not be able to escape due to mutations.
The Company continues to advance its first drug candidate, namely NV-HHV-101 skin cream, for the treatment of shingles rash as its first indication, towards human clinical trials. All of the planned IND-enabling Safety/Toxicology studies as well as other required non-clinical studies have been completed, and draft reports of various studies are being circulated between collaborating parties, as of the filing date. The Company anticipates receiving final cGLP reports for inclusion in our IND filing once the quality assurance processes are completed.
The Company has undertaken cGMP manufacture of the drug product, namely, NV-HHV-101 skin cream, indicated for the topical treatment of shingles rash, for supplying anticipated Phase I human clinical trials at its own facility. The Company has industry-leading internal expertise in the cGMP manufacture of complex nanomedicines drugs, right from simple starting materials to formulated drug products.
In a human skin patch organ culture model ex vivo, the Company has previously demonstrated the effectiveness and safety of topical NV-HHV-101 against VZV, the cause of shingles and chickenpox. These studies were conducted by Professor Jennifer Moffat at the Upstate Medical Center, SUNY Syracuse, NY. Professor Moffat has developed this model for pre-clinical evaluation of therapeutics against VZV, and is a well known expert in the field.
It is anticipated that the high effectiveness of our clinical drug candidate observed in this human skin model should be predictive of effectiveness in human clinical trials for topical dermal treatment of shingles.
Following shingles drug development, the Company anticipates developing drugs for HSV-1 cold sores and HSV-2 genital ulcers treatments using NV-HHV-101. The total market for our HerpeCide™ program drugs is estimated at several tens of billions of dollars because neither cures nor very effective treatments are available. The Company also has drug candidates in development at different pre-clinical stages in its Influenza and HIV drug programs. In addition, the Company has drug candidates against Dengue viruses, and was developing drugs against Ebola/Marburg viruses among others. The Company anticipates re-engaging these programs upon appropriate financing becoming available. Thus the Company has a rich and expanding pipeline of highly effective and safe drug candidates against a number of viral diseases.
NanoViricides is pioneering a unique platform for developing anti-viral drugs based on the “bind-encapsulate-destroy” principles. Viruses would not be able to escape a properly designed nanoviricide® drug by mutations because in doing so they would lose the ability to bind their cognate cellular receptor(s) and thus fail to infect productively, becoming incompetent.
There is a significant unmet medical need for the topical treatment of shingles rash. An effective therapy for shingles has been estimated to have a market size into several billions of dollars, if it reduces PHN incidence. An effective therapy for shingles rash reduction alone is estimated to have a market size of several hundred million dollars to low billion dollars. These market size estimates have taken into account the potential impact of the new Shingrix® GSK vaccine, assuming scaling up of their production in the 2024 time-frame, and the impact of the existing Zostavax® vaccine. Of note, the Shingrix vaccine has been found to cause significant, debilitating, side effects in as many as 15%-20% of the persons receiving it. Given that shingles is not a life-threatening disease (except under certain conditions), the uptake of such a vaccine with high incidence of adverse effects may be limited. Shingrix is not yet widely available.
The Company develops its class of drugs, that we call nanoviricides®, using a platform technology. This approach enables rapid development of new drugs against a number of different viruses. A nanoviricide is a “biomimetic” – it is designed to “look like” the cell surface to the virus. The nanoviricide® technology enables direct attacks at multiple points on a virus particle. It is believed that such attacks would lead to the virus particle becoming ineffective at infecting cells. Antibodies in contrast attack a virus particle at only a maximum of two attachment points per antibody. In addition, the nanoviricide technology also simultaneously enables attacking the rapid intracellular reproduction of the virus by incorporating one or more active pharmaceutical ingredients (APIs) within the core of the nanoviricide. The nanoviricide technology is the only technology in the world, to the best of our knowledge, that is capable of both (a) attacking extracellular virus, thereby breaking the reinfection cycle, and simultaneously (b) disrupting intracellular production of the virus, thereby enabling complete control of a virus infection.About NanoViricides
NanoViricides, Inc. (www.nanoviricides.com) is a development stage company that is creating special purpose nanomaterials for antiviral therapy. The Company’s novel nanoviricide® class of drug candidates are designed to specifically attack enveloped virus particles and to dismantle them. Our lead drug candidate is NV-HHV-101 with its first indication as dermal topical cream for the treatment of shingles rash. The Company is also developing drugs against a number of viral diseases including oral and genital Herpes, viral diseases of the eye including EKC and herpes keratitis, H1N1 swine flu, H5N1 bird flu, seasonal Influenza, HIV, Hepatitis C, Rabies, Dengue fever, and Ebola virus, among others. The Company’s technology is based on broad, exclusive, sub-licensable, field licenses to drugs developed in these areas from TheraCour Pharma, Inc. This press release contains forward-looking statements that reflect the Company’s current expectation regarding future events. Actual events could differ materially and substantially from those projected herein and depend on a number of factors. Certain statements in this release, and other written or oral statements made by NanoViricides, Inc. are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Important factors that could cause actual results to differ materially from the company’s expectations include, but are not limited to, those factors that are disclosed under the heading “Risk Factors” and elsewhere in documents filed by the company from time to time with the United States Securities and Exchange Commission and other regulatory authorities. Although it is not possible to predict or identify all such factors, they may include the following: demonstration and proof of principle in preclinical trials that a nanoviricide is safe and effective; successful development of our product candidates; our ability to seek and obtain regulatory approvals, including with respect to the indications we are seeking; the successful commercialization of our product candidates; and market acceptance of our products. FDA refers to US Food and Drug Administration. IND application refers to “Investigational New Drug” application. CMC refers to “Chemistry, Manufacture, and Controls”.
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