UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. ☐
SECTION 2 – FINANCIAL INFORMATION
| Item 2.02 | Results of Operations and Financial Condition. |
On August 10, 2020, Galectin Therapeutics Inc. (“Galectin Therapeutics”) issued a press release announcing its results of operations and financial condition as of and for the three and six months ended June 30, 2020 and provided a business update. Galectin hereby incorporates by reference herein the information set forth in its press release dated August 10, 2020 (the “Press Release”), a copy of which is attached hereto as Exhibit 99.1.
Except for the historical information contained in this report, the statements made by Galectin Therapeutics are forward looking statements that involve risks and uncertainties. All such statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. Galectin Therapeutics’ future financial performance could differ significantly from the expectations of management and from results expressed or implied in the Press Release. Forward-looking statements in the Press Release are subject to certain risks and uncertainties described in the Press Release. For further information on other risk factors, please refer to the “Risk Factors” contained in Galectin Therapeutics’ Annual Report on Form 10-K for the fiscal year ended December 31, 2019, as filed with the Securities and Exchange Commission, and its subsequent filings with the SEC.
The information in this Item 2.02 is being furnished, not filed, pursuant to Item 2.02 of Form 8-K. Accordingly, the information in Item 2.02 of this report, including the Press Release attached hereto as Exhibit 99.1, will not be incorporated by reference into any registration statement filed by Galectin under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit |
Description | |
| 99.1 | Press Release dated August 10, 2020 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Galectin Therapeutics Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Galectin Therapeutics Inc. | ||||||
| Date: August 10, 2020 | By: | /s/ Jack W. Callicutt | ||||
| Jack W. Callicutt | ||||||
| Chief Financial Officer | ||||||
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Exhibit 99.1
Galectin Therapeutics Reports Financial Results for the Quarter Ended June 30, 2020, and Provides Business Update
NASH-RX Trial Continues to Enroll New Patients
NORCROSS, Ga., August 10, 2020 (GLOBE NEWSWIRE) – Galectin Therapeutics Inc. (NASDAQ: GALT), the leading developer of therapeutics that target galectin proteins, today reported financial results and provided a business update for the quarter ended June 30, 2020. These results are included in the Company’s Quarterly Report on Form 10-Q, which has been filed with the U.S. Securities and Exchange Commission and is available at www.sec.gov.
Harold H. Shlevin, Ph.D., President and Chief Executive Officer of Galectin Therapeutics, said, “We are excited to have initiated the NASH-RX trial, having enrolled our first patient in June and continuing to enroll patients at several of our sites in our clinical trial of belapectin targeting cirrhotic NASH patients. If the results of the NASH-RX trial are compelling, there could be the potential for accelerated FDA approval and/or partnership opportunity with a pharmaceutical company. Later this quarter, we plan to host a conference call with the Investment Community for a more thorough discussion of the NASH-RX trial, its current status, our updated strategy, and to take questions.”
Richard E. Uihlein, Chairman of the Board, added, “The protocol of the NASH-RX trial has been designed to provide belapectin with the best chance to demonstrate efficacy and safety, and I am very pleased this trial is now underway. Belapectin is targeting NASH cirrhosis patients, those who can no longer expect to benefit from increased exercise or an improved diet as may benefit many of those with earlier stages of NASH. And, belapectin (formerly known as GR-MD-02) is the first drug that has been shown to prevent the development of esophageal varices in patients with compensated NASH cirrhosis. If confirmed, these results would constitute a significant benefit for patients. Consequently, we believe our drug targets NASH at a very critical point of its development, as it represents an opportunity to prevent the progression of liver damage, and thereby save lives.”
The NASH-RX trial will use an adaptive design to confirm dose selection and reaffirm the efficacy data observed in the NASH-CX trial and, with pre-planned adaptations, inform the larger Phase 3 trial component. In June 2020, we enrolled our first patients in the NASH-RX trial. NASH-RX is expected to enroll approximately 315 NASH patients in the Phase 2b part of the trial at approximately 130 sites in 12 countries in North America, Europe, Asia and Australia.
Galectin plans to host a conference call with the investment community in the third quarter to provide a more comprehensive description and update on the status of the trial and to take questions. The date and time of the call and how to participate will be published in advance of the planned call.
Financial Results
For the three months ended June 30, 2020, the Company reported a net loss applicable to common stockholders of $6.2 million, or ($0.11) per share, compared to a net loss applicable to common stockholders of $3.1 million, or ($0.06) per share for the three months ended June 30, 2019. The increase is due to 2020 research and development expense related to the Company’s NASH-RX trial.
Research and development expense for the three months ended June 30, 2020 was $4.7 million compared with $1.5 million for the three months ended June 30, 2019. The increase was primarily due to costs related to our NASH-RX clinical trial, along with preparations and some preclinical activities incurred in support of the clinical program, such as development and reproductive toxicity studies, clinical supplies and other supportive activities. General and administrative expenses for the three months ended June 30, 2020, were $1.4 million, down from $1.5 million for the three months ended March 31, 2019, primarily due to a decrease in stock-based compensation expenses.
As of June 30, 2020, the Company had $40.8 million of cash and cash equivalents. The Company also has a $10 million unsecured line of credit, under which no borrowings have been made to date. The Company believes it has sufficient cash, including availability under the line of credit, to fund currently planned operations and research and development activities through at least September 30, 2021.
The Company expects that it will require more cash to fund operations after September 30, 2021 and believes it will be able to obtain additional financing as needed. The total cost to obtain the interim analysis data of the planned trial, including general overhead, is currently estimated to be approximately $90 million. These costs will require additional funding. There can be no assurance that we will be successful in obtaining financing to support our operations beyond September 30, 2021, or, if available, that any such financing will be on terms acceptable to us.
About Belapectin (GR-MD-02)
Belapectin (GR-MD-02) is a complex carbohydrate drug that targets galectin-3, a critical protein in the pathogenesis of fatty liver disease and fibrosis. Galectin-3 plays a major role in diseases that involve scarring of organs including fibrotic disorders of the liver, lung, kidney, heart and vascular system. The drug binds to galectin proteins and disrupts their function. Preclinical data in animals have shown that belapectin has robust treatment effects in reversing liver fibrosis and cirrhosis.
About Fatty Liver Disease with Advanced Fibrosis and Cirrhosis
Non-alcoholic steatohepatitis (NASH) has become a common disease of the liver with the rise in obesity and other metabolic diseases. NASH is estimated to affect up to 28 million people in the U.S. It is characterized by the presence of excess fat in the liver along with inflammation and hepatocyte damage (ballooning) in people who consume little or no alcohol. Over time, patients with NASH can develop excessive fibrosis, or scarring of the liver, and ultimately liver cirrhosis. It is estimated that as many as 1 to 2 million individuals in the U.S. will develop cirrhosis as a result of NASH, for which liver transplantation is the only curative treatment available. Approximately 8,890 liver transplants are performed annually in the U.S. There are no drug therapies approved for the treatment of liver fibrosis or cirrhosis.
About Galectin Therapeutics
Galectin Therapeutics is dedicated to developing novel therapies to improve the lives of patients with chronic liver disease and cancer. Galectin’s lead drug belapectin (formerly known as GR-MD-02) is a carbohydrate-based drug that inhibits the galectin-3 protein which is directly involved in multiple inflammatory, fibrotic, and malignant diseases, for which it has Fast Track designation by the U.S. Food and Drug Administration. The lead development program is in non-alcoholic steatohepatitis (NASH) with cirrhosis, the most advanced form of NASH-related fibrosis. This is the most common liver disease and one of the largest drug development opportunities available today. Additional development programs are in treatment of combination immunotherapy for advanced melanoma and other malignancies. Advancement of these additional clinical programs is largely dependent on finding a suitable partner. Galectin seeks to leverage extensive scientific and development expertise as well as established relationships with external sources to achieve cost-effective and efficient development. Additional information is available at www.galectintherapeutics.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or future financial performance, and use words such as “may,” “estimate,” “could,” “expect” and others. They are based on management’s current expectations and are subject to factors and uncertainties that could cause actual results to differ materially from those described in the statements. These statements include those regarding the hope that Galectin’s development program for belapectin will lead to the first therapy for the treatment of fatty liver disease with cirrhosis and those regarding the hope that our lead compounds will be successful in cancer immunotherapy and in other therapeutic indications. Factors that could cause actual performance to differ materially from those discussed in the forward-looking statements include, among others, that trial endpoints required by the FDA may not be achieved; Galectin may not be successful in developing effective treatments and/or obtaining the requisite approvals for the use of belapectin or any of its other drugs in development; the Company may not be successful in scaling up manufacturing and meeting requirements related to chemistry, manufacturing and control matters; the Company’s currently planned clinical trial and any future clinical studies as modified to meet the requirements of the FDA may not produce positive results in a timely fashion, if at all, and could require larger and longer trials, which would be time consuming and costly; plans regarding development, approval and marketing of any of Galectin’s drugs are subject to change at any time based on the changing needs of the Company as determined by management and regulatory agencies; regardless of the results of any of its development
programs, Galectin may be unsuccessful in developing partnerships with other companies or raising additional capital that would allow it to further develop and/or fund any studies or trials. Galectin has incurred operating losses since inception, and its ability to successfully develop and market drugs may be impacted by its ability to manage costs and finance continuing operations. Global factors such as coronavirus may limit access to NASH patient populations around the globe and slow trial enrollment and prolong the duration of the trial and significantly impact associated costs. For a discussion of additional factors impacting Galectin’s business, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, and subsequent filings with the SEC. You should not place undue reliance on forward-looking statements. Although subsequent events may cause its views to change, management disclaims any obligation to update forward-looking statements.
Company Contact:
Jack Callicutt, Chief Financial Officer
(678) 620-3186
ir@galectintherapeutics.com.
Galectin Therapeutics and its associated logo is a registered trademark of Galectin Therapeutics Inc. Belapectin is the USAN assigned name for Galectin Therapeutics’ galectin-3 inhibitor GR-MD-02
Condensed Consolidated Statements of Operations
| Three Months Ended June 30, |
Six Months Ended June 30, |
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| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| (in thousands, except per share data) | ||||||||||||||||
| Operating expenses: |
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| Research and development |
$ | 4,681 | $ | 1,522 | $ | 6,825 | $ | 2,168 | ||||||||
| General and administrative |
1,421 | 1,498 | 2,861 | 3,219 | ||||||||||||
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| Total operating expenses |
6,102 | 3,020 | 9,686 | 5,387 | ||||||||||||
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| Total operating loss |
(6,102 | ) | (3,020 | ) | (9,686 | ) | (5,387 | ) | ||||||||
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| Other income (expense): |
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| Interest income |
9 | 43 | 59 | 57 | ||||||||||||
| Interest expense |
(21 | ) | (21 | ) | (43 | ) | (43 | ) | ||||||||
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| Total other income |
(12 | ) | 22 | 16 | 14 | |||||||||||
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| Net loss |
$ | (6,114 | ) | $ | (2,998 | ) | $ | (9,670 | ) | $ | (5,373 | ) | ||||
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| Preferred stock dividends |
(66 | ) | (67 | ) | (60 | ) | (163 | ) | ||||||||
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| Warrant modification |
(6,622 | ) | ||||||||||||||
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| Net loss applicable to common stock |
$ | (6,180 | ) | $ | (3,065 | ) | $ | (12,158 | ) | $ | (12,158 | ) | ||||
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| Basic and diluted net loss per share |
$ | (0.11 | ) | $ | (0.06 | ) | $ | (0.17 | ) | $ | (0.26 | ) | ||||
| Shares used in computing basic and diluted net loss per share |
57,035 | 50,301 | 56,995 | 47,653 | ||||||||||||
Condensed Consolidated Balance Sheet Data
| June 30, 2020 | December 31, 2019 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents |
$ | 40,768 | $ | 47,480 | ||||
| Total assets |
41,317 | 48,467 | ||||||
| Total current liabilities |
4,274 | 2,820 | ||||||
| Total liabilities. |
4,305 | 2,872 | ||||||
| Total redeemable, convertible preferred stock |
1,723 | 1,723 | ||||||
| Total stockholders’ equity |
$ | 35,289 | $ | 43,872 | ||||
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