Critical Outcome Technologies Inc. (TSX Venture: COT; OTCQB: COTQF) (“COTI” or the “Company”) reported its financial and operating results today for the three- and nine-month periods ended January 31, 2017. Major highlights for the quarter included:
- Commencing dosing of cohort 4 patients in the Phase 1 clinical trial of the Company’s lead drug candidate, COTI-2. The trial is evaluating the safety and tolerability of COTI-2 in women with advanced gynecologic cancers who have failed conventional therapy;
- Completing regulatory requirements to initiate the two expansion cohorts in the ongoing COTI-2 trial. The expansion cohorts will include patients with recurrent ovarian cancer, and recurrent squamous cell head and neck cancer; dosing of patients is expected to begin in 2H 2017;
- Broadening the COTI-2 indication landscape with the initiation of activities for a p53 basket trial to include other cancers, potentially colorectal cancer, lung cancer, and pancreatic cancer; dosing of patients is expected to begin in 2H 2017;
- Executing COTI’s succession plan with the appointment of Alison Silva as Chief Executive Officer and strengthening the Company’s management team with internal hires.
“During the quarter, we continued to make excellent progress towards advancing our pipeline. We were pleased to begin dosing of the fourth cohort in the Phase 1 trial of our lead asset, COTI-2, intended for the treatment of gynecological cancer. We expect to begin dosing the fifth, sixth, and expansion cohorts later this year,” said Alison Silva, President & CEO. “In 2017, we also expect to initiate new trials with COTI-2, and to file an investigational new drug (“IND”) application for our second clinical candidate, COTI-219. We are excited for the catalyst-rich year ahead, and look forward to sharing the news in the coming months, as we continue to leverage our proprietary CHEMSAS® platform to drive our pipeline of innovative internally developed novel compounds into development for the treatment of serious diseases.
The Company’s operational activities during the quarter were primarily focused on advancing the Phase 1 clinical trial of COTI-2 for the treatment of gynecologic cancers. The Company incurred a net loss of $1.2 million, or $0.01 per share, for the three months ended January 31, 2017 compared to a net loss of $0.6 million, or $0.01 per share, for the three months ended January 31, 2016. The increase in net loss is primarily due to an increase in Research and Development (“R&D”) expense, and General and Administration (“G&A”) expense, partially offset by an expense recovery related to the quarter-end revaluation of the Company’s USD denominated warrant liability.
For the nine months ended January 31, 2017, the Company reported a net loss of $4.3 million or $0.03 per share, compared to a loss of $2.6 million or $0.02 per share for the same period in 2016. Increases in R&D expense and G&A expense for the nine months ended January 31, 2017 were responsible for the increase in net loss compared to the same periods in 2016. These increases were partially offset by a decrease in Sales and Marketing expense (“S&M”) and an increase in Investment Tax Credit income (“ITC”).
R&D expense in the three- and nine-month periods ended January 31, 2017 increased by $0.3 million and $1.0 million respectively over the same periods in 2016, primarily due to COTI-2 clinical trial costs. G&A expense in the three- and nine-month periods ended January 31, 2017 increased $0.8 million and $1.4 million respectively over the same periods in 2016, primarily due to compensation expenses related to changes in the senior management team. These expenses included transitional payments in respect of the leadership succession and reflect added managerial capacity.
S&M expense in the three- and nine-month periods ended January 31, 2017 decreased nominally compared to the same periods in 2016 due to the shift of business development and investor relations responsibilities from external consultants to internal personnel. ITC income in the three- and ninemonth periods ended January 31, 2017 increased nominally and by $0.1 million respectively compared to the same periods in 2016 due to an increase in eligible R&D expenditures.