PARIS, France, April 30, 2024 at 11:45 p.m. (CET) – Pharnext SCA (FR001400N1P4 – ALPHA)
(the “Company”), an advanced clinical stage biopharmaceutical company developing new therapies for neurodegenerative diseases without satisfactory therapeutic solutions, announces the availability of its 2023 annual financial report
[1]
including the auditors’ report.
In view of the multiple uncertainties relating to the continuity of operations which have been communicated to them and which are described in the notes annexed to the annual accounts, the auditors indicate that they are unable to certify the annual accounts for the closed financial year. on December 31, 2023.
[2]
.
HIGHLIGHTS OF THE 2023 FINANCIAL YEAR
The 2023 financial year was marked by the finalization of the PREMIER trial, a pivotal double-blind Phase III clinical study of PXT3003 in Charcot-Marie-Tooth disease type 1A (CMT1A), the first results of which were published on December 11, 2023.
In order to successfully complete the end of its Phase III clinical study while preserving its financial resources, the Company has implemented a policy of strict cost control, making it possible to reduce net cash consumption
[3]
before financing, from €25.1 million in 2022 to €19.4 million.
The bond financing contracts currently being executed have enabled Pharnext to have the financial resources necessary to cover its needs, leaving cash at the end of the financial year of €0.01 million. At the end of 2023, the amount of bond loans not yet converted amounts to €26.2 million.
UPDATE ON THE CONCILIATION PROCEDURE AND NEXT STEPS
As announced in the press release of March 11, 2024
[4]
Pharnext has opened conciliation, under the aegis of the President of the Paris Commercial Court, to initiate discussions with its main creditors while awaiting the future results (expected before summer 2024) of the Phase trial III currently carried out in China by its partner Tasly (through their joint venture of which Pharnext holds 30%), which acquired the licensing rights for PXT3003 in China in 2017.
As a reminder, the challenge of this conciliation is to align the financial resources and the commitments of the Company in conjunction with its main partners, while awaiting the results of this study conducted in China, the final stages of analysis of the data from the PREMIER trial and the outcome of negotiations with financial and industrial partners interested in a license or distribution contract for PXT3003, particularly in the event of success of the trial conducted in China.
In accordance with the commitments made, monthly cash consumption was reduced to €0.57 million in February 2024, €0.24 million in March 2024 compared to €1.6 million on monthly average in 2023.
On the debt side, the Company must, to date, face the following main commitments:
gross financial debt of €6 million, mainly composed of the cash flow agreement between Néovacs and Pharnext (€3.6 million, including €0.4 million additional since 1
er
January 2024) and bonds subscribed by the company Global Tech Opportunities 13 and not yet converted into shares (€2.8 million); debts not intended to be repaid in cash in the short term;supplier debts amounting to around €7 million, mainly made up of invoices issued by partners in the context of clinical trials, including €2.2 million subject to disputes by the Company.
To date, the Company’s main creditors, already representing more than 70% of the debts (in value, excluding contested debts), have given their agreement to suspend the payment of their debt pending the results. of the study carried out in China and, to Pharnext’s knowledge, no significant debt is currently the subject of legal recovery proceedings.
As of April 30, 2024, the Company has cash of €0.2 million and theoretical drawing capacity of €11.9 million under the financing contract put in place with the company Global Tech Opportunities 13. Please note also that, as announced on January 17, 2024, the company Global Tech Opportunities 13 has given its agreement to the implementation of an amendment to the financing contract allowing Pharnext to secure 4 drawings of €250,000, in return for additional remuneration of 20% compared to the terms of the initial contract. To date, 2 draws of €250,000 have been made and a discussion is underway with Global Tech Opportunities 13 to obtain the balance.
Furthermore, the Company recalls that it is also (accountingly) debtor of the total sum of nearly €20.3 million which corresponds to the residual debt, not yet
equitized
, held by the management trust established as an extension of the bond financing put in place in 2022 between the Company and Neovacs. That being said, to the extent that the
equitization
– that is to say the reimbursement – of this debt has no impact on the Company’s cash flow, this debt is not intended to be processed within the framework of conciliation.
Hugo Brugière, manager of Pharnext, declares:
“
I would like to publicly thank all our partners who have agreed to continue to support us and give us all the time necessary to have certainty.
As I have already said, the results of the study conducted in China will be a turning point for Pharnext. We now know that we have the means to hold out until this next major deadline, which we will communicate as soon as possible.
»
UPDATE ON OFFERS RECEIVED
Finally, Pharnext confirms that, to date, all the laboratories having expressed an interest in signing an exclusivity agreement on the rights to PXT3003, including in particular the 3 main declared candidates, remain awaiting the conclusions final analyzes of the ongoing analyzes and the results of the study carried out in China and none have formally declared their withdrawal from the process.
Only one candidate indicated that the conditions of their initial offer were not met due to the nature of the initial results but that they remained interested and engaged in the process. Previously announced working meetings were carried out as planned with some candidates to analyze current data and additional working meetings are being planned.
The Company hopes to receive an update on the expressions of interest and offers previously received following the publication of the results of the study conducted in China and will not fail to inform the market of any significant developments.
Warning :
The company Pharnext has set up (i) financing in the form of OCEANE-BSA with the company Global Tech Opportunities 13, which, after having received the shares resulting from the conversion or exercise of these instruments, has not not intended to remain a shareholder of the company, and (ii) financing in OS which were then transferred to a trust, which is now responsible for their equitization.
The shares resulting from the conversion or exercise of the above-mentioned securities are generally sold in the market at very short notice, which can create strong downward pressure on the share price. In the specific case of the trust, the shares are sold on the market according to the terms set out in the trust agreement.
Shareholders may suffer a loss of their invested capital due to a significant decrease in the value of the company’s stock, as well as significant dilution due to the number of securities issued to the company Global Tech Opportunities 13 and/or trust.
Investors are advised to be very vigilant before making the decision to invest (or remain invested) in the securities of the company admitted to trading which carries out such dilutive financing transactions, particularly when they are carried out successively. The company recalls that this dilutive financing operation is not the first that it has implemented.
About Pharnext
Pharnext is a late-stage clinical-stage biopharmaceutical company developing novel therapies for neurodegenerative diseases currently without satisfactory therapeutic solutions. Pharnext has a new drug candidate, PXT3003, in development for Charcot-Marie-Tooth disease type 1A (CMT1A), a rare and debilitating hereditary peripheral neuropathy. PXT3003 benefits from orphan drug status in Europe and the United States. More information on www.pharnext.com.
Pharnext is listed on the Euronext Growth market in Paris (ISIN code: FR001400N1P4).
Contacts
|
Financial Press Relations NEWS finance & communication Anne-Charlotte Dudicourt [email protected] +33 (0)1 53 67 36 32 |
Investor Relations NEWS finance & communication Jérôme Fabreguettes Leib [email protected] +33 (0)1 53 67 36 78 |
[1]
The main financial elements presented come from the financial statements established in accordance with French accounting standards, approved by the Management and reviewed by the Supervisory Board of the Company at its meeting of April 30, 2024. The annual financial report is available on the website of Pharnext in the “investors” section
[2]
The reader is invited to refer to the auditors’ report available on the Company’s website.
[3]
Cash flow from operating activities + cash flow from investing activities
[4]
Pharnext provides a complete update on its operational, strategic and financial situation
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