10-Q: PharmaCyte Biotech Reports Q3 2025 Results, Cites Progress on Clinical Hold and Investment Activity

Sentiment:

Quarterly Report 17 March 2025 5:22 PM

📋All filings for Pharmacyte Biotech, INC

PharmaCyte Biotech's Q3 2025 report highlights efforts to address the FDA clinical hold, investment in TNF Pharmaceuticals, and a decrease in operating expenses.

Delay expectedThe FDA clinical hold on the IND continues to delay the planned clinical trial in LAPC.The company is reevaluating programs dependent on SG Austria and the FDA's acceptance of its technologies.

Capital raiseThe Company may need to raise additional capital in order to initiate and pursue potential additional projects, including the continuing development beyond the ongoing pancreatic cancer research.Any additional equity financing, if available, may not be on favorable terms and would likely be significantly dilutive to the Company’s current stockholders, and debt financing, if available, may have restrictive covenants.

Worse than expectedThe company's cash position has decreased significantly.The company is still under a clinical hold from the FDA.The company is involved in a legal proceeding with H.C. Wainwright & Co., LLC.

Summary

PharmaCyte Biotech reported its financial results for the third quarter of fiscal year 2025, ended January 31, 2025.
The company is focused on developing cellular therapies for cancer using its Cell-in-a-Box technology.
A key focus remains on addressing the clinical hold placed by the FDA on its Investigational New Drug Application (IND) for a planned clinical trial in locally advanced pancreatic cancer (LAPC).
The company has been working to complete additional preclinical studies and provide further information requested by the FDA to lift the clinical hold.
Operating expenses decreased significantly compared to the same period last year, primarily due to reduced compensation, director fees, and general and administrative costs.
The company invested in TNF Pharmaceuticals, Inc., purchasing Series G Convertible Preferred Stock and warrants.
As of January 31, 2025, PharmaCyte had approximately $16.4 million in cash and cash equivalents.
The company believes its current cash will be sufficient to fund operating expenses for at least the next 12 months, but may need to raise additional capital for further projects.
The company is involved in a legal proceeding with H.C. Wainwright & Co., LLC, which it intends to vigorously defend against.
The company is reevaluating programs dependent on SG Austria and the FDA's acceptance of its technologies.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While the company has made progress in addressing the FDA's concerns and has reduced operating expenses, the clinical hold and ongoing legal proceedings create uncertainty. The investment in TNF Pharmaceuticals is a positive sign, but the overall outlook is mixed.

Positives

Operating expenses have decreased, indicating cost control measures.
The company has made progress in addressing the FDA's concerns regarding the clinical hold.
The company has successfully completed various additional studies requested by the FDA.
The company has cash and cash equivalents of $16,383,460 as of January 31, 2025.
The company recognized a gain of $21,395,734 on a related party investment.

Negatives

The FDA clinical hold on the IND continues to delay the planned clinical trial in LAPC.
The company has a history of operating losses and liquidity challenges.
The company is involved in a legal proceeding with H.C. Wainwright & Co., LLC.
The company is reevaluating programs dependent on SG Austria and the FDA's acceptance of its technologies.
The company's Interim Chairman, Interim Chief Executive Officer, and Interim President, as our principal executive officer (Chief Executive Officer), and our Chief Financial Officer, as our principal financial officer (Chief Financial Officer), evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) promulgated under the Exchange Act. Based upon this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of January 31, 2025, certain of our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting.

Risks

The company's ability to obtain additional capital when needed is not assured.
The company's dependence on third parties in the conduct of its preclinical studies and clinical trials poses a risk.
The company's relationship with SG Austria and its subsidiaries is under review, which could impact development programs.
The company is involved in a legal proceeding with H.C. Wainwright & Co., LLC, which it intends to vigorously defend against.
The company's Interim Chairman, Interim Chief Executive Officer, and Interim President, as our principal executive officer (Chief Executive Officer), and our Chief Financial Officer, as our principal financial officer (Chief Financial Officer), evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) promulgated under the Exchange Act. Based upon this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of January 31, 2025, certain of our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting.

Future Outlook

The company expects its current cash and cash equivalents will be sufficient to support its projected operating requirements and financial commitments for at least the next twelve months, but may need to raise additional capital in order to initiate and pursue potential additional projects.

Management Comments

The Board has reduced spending on our programs, including pre-clinical and clinical activities, until the review by the Scientific Committee and the Board is complete and the Board has determined the actions and plans to be implemented.
The Scientific Committees recommendations will include potentially seeking a new framework for our relationship with SG Austria and its subsidiaries.
We are reevaluating those programs which are dependent on SG Austria and the U.S. Food and Administrations (the FDA) acceptance of its technologies, including our development programs for locally advanced, inoperable, non-metastatic pancreatic cancer (LAPC).

Industry Context

The report reflects the challenges and opportunities inherent in the biotechnology industry, particularly for companies focused on novel therapies and navigating regulatory hurdles. The company's focus on addressing the FDA clinical hold and exploring alternative approaches aligns with industry trends of prioritizing regulatory compliance and diversifying development strategies.

Comparison to Industry Standards

The company's reliance on third-party collaborations, particularly with SG Austria, is a common practice in the biotech industry, but also introduces risks related to alignment of incentives and control over intellectual property.
The company's investment in TNF Pharmaceuticals is similar to other biotech companies that invest in other companies to diversify their portfolio.
The company's focus on addressing the FDA clinical hold is similar to other biotech companies that are working to get their products approved.

Legal Proceedings

On December 4, 2023, H.C. Wainwright & Co., LLC (Wainwright) filed a complaint against the Company in the Supreme Court of the State of New York, County of New York, asserting a single cause of action for breach of contract and alleging that the Company breached an April 2021 engagement agreement with Wainwright by failing to pay a purported tail fee allegedly due in connection with a private placement transaction that closed in 2023.
Wainwright seeks damages of not less than $1,950,000, warrants to purchase an aggregate of 656,250 shares of our common stock at an exercise price of $5.00 per share, and attorneys fees.
On February 28, 2024, we responded to the complaint with an answer and affirmative defenses.
The parties have commenced documentary discovery and are reviewing the documents.
We intend to vigorously defend against Wainwrights complaint and do not believe that any potential loss is reasonably estimable at this time.

Related Party Transactions

The Company owns 13.9 % of the equity in SG Austria which is presented using the alternative allowed under ASC 321 Investments Equity Securities with no readily determinable values.
SG Austria has two subsidiaries: (i) Austrianova; and (ii) Austrianova Thailand.
The Company purchased products and services from these subsidiaries in the approximate amounts of $ 0 in the three and nine months ended January 31, 2025, and 2024, respectively.
In April 2014, the Company entered the Vin-de-Bona Consulting Agreement pursuant to which it agreed to provide professional consulting services to the Company.
The amounts incurred for the three and nine months ended January 31, 2025, were approximately $ 10,390 and $ 15,670 , respectively, and approximately $ 2,630 and $ 5,330 for the three and nine months ended January 31, 2024, respectively.
The Companys Interim Chief Executive Officer was appointed to the Femasys board of directors.
The Companys Interim Chief Executive Officer serves on the board of directors of TNF.

Stakeholder Impact

Shareholders: The company's financial performance and progress on the clinical hold will impact shareholder value.
Employees: The company's cost control measures and strategic review may impact employees.
Customers: The company's progress on developing cellular therapies for cancer will impact potential patients.
Suppliers: The company's spending on research and development will impact suppliers.
Creditors: The company's ability to meet its financial obligations will impact creditors.

Next Steps

Continue working to address the FDA's requests to lift the clinical hold on the IND.
Complete the review by the Strategic Scientific Committee and the Board.
Seek a new framework for the relationship with SG Austria and its subsidiaries.
Vigorously defend against the complaint filed by H.C. Wainwright & Co., LLC.

Key Dates

Date	Description
1996	PharmaCyte Biotech, Inc. incorporated in Nevada.
2013	Company restructured operations to focus on biotechnology.
2015-01	Company changed its name from Nuvilex, Inc. to PharmaCyte Biotech, Inc.
2020-09-01	Company submitted an Investigational New Drug Application (IND) to the U.S. Food and Drug Administration (FDA) for a planned clinical trial in LAPC.
2020-10-01	Company received notice from the FDA that it had placed the IND on clinical hold.
2020-10-30	FDA sent a letter to the Company setting forth the reasons for the clinical hold and specific guidance on what the Company must do to have the clinical hold lifted.
2021-10	Company moved its headquarters from Laguna Hills, California to Las Vegas, Nevada.
2022-05	Board authorized a share repurchase program to acquire its outstanding common stock for up to $10 million.
2022-08-15	Company entered into a Cooperation Agreement with Iroquois Master Fund Ltd. and its affiliates.
2022-12-28	Company implemented the 2022 Equity Incentive Plan (2022 Equity Plan) as approved by the Company’s stockholders.
2023-01	Board authorized an additional share repurchase program to acquire up to an additional $10 million of the Company’s outstanding common stock.
2023-05-10	Company entered into a Securities Purchase Agreement (the Purchase Agreement) with certain accredited investors (the Investors), pursuant to which it agreed to sell to the Investors (i) an aggregate of 35,000 shares of the Company’s newly-designated Series B convertible preferred stock with a stated value of $1,000 per share, initially convertible into up to 8,750,000 shares of the Company’s common stock, par value $0.0001 per share at a conversion price of $4.00 per share (the Preferred Shares), and (ii) warrants to acquire up to an aggregate of 8,750,000 shares of common stock (the Warrants) (collectively, the Private Placement).
2023-05-11	Company commenced a tender offer, in accordance with Rule 13e-4 promulgated under the Securities Exchange Act of 1934, as amended, to purchase up to 7,750,000 shares of its common stock, par value $0.0001 per share, at a price of $3.25 per share.
2023-06-09	The tender offer expired one minute after 11:59 p.m.
2023-08-31	The Company received Nasdaq Stockholder Approval at its special meeting of stockholders.
2023-11-14	Company entered into a Securities Purchase Agreement (the Femasys Purchase Agreement) with Femasys Inc. (Femasys).
2023-11-17	The Board formed the Strategic Scientific Committee (the Scientific Committee), chaired by Dr. Michael Abecassis.
2023-11-09	The Company is required to settle the Preferred Shares in equal monthly installments, commencing on November 9, 2023.
2023-12-04	H.C. Wainwright & Co., LLC (Wainwright) filed a complaint against the Company in the Supreme Court of the State of New York, County of New York.
2024-02-28	Company responded to the complaint with an answer and affirmative defenses.
2024-05-20	Company entered into a Securities Purchase Agreement (the SPA) with a public company operating in the medical industry, MyMD Pharmaceuticals, Inc. which subsequently changed its name to TNF Pharmaceuticals, Inc., (TNF).
2024-09-27	Company reclassified a portion of the Preferred Shares to an accrued liability for the final (thirteenth) installment redemptions owed to investors in cash of $ 3,720,458.
2024-11-12	Company paid the accrued liability of $ 3,720,458 in full settlement of the Preferred Shares.
2024-11-21	Company received from the Femasys Notes a payment in Femasys common stock for interest income in the amount of $ 300,000.
2025-01-31	End of the quarterly period for this report.
2025-03-07	As of March 7, 2025, the registrant had 6,863,699 outstanding shares of common stock, with a par value of $0.0001 per share.
2025-03-17	Date of this report.

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