Phio Pharmaceuticals announces second quarter 2024 financial results and provides an update on its business

Marlborough, Massachusetts–(Newsfile Corp. – August 14, 2024) – Phio Pharmaceuticals Corp. (NASDAQ: PHIO), a clinical-stage biotechnology company whose proprietary INTASYL™ RNAi gene silencing technology is designed to make immune cells more effective at killing tumor cells, today reported its financial results for the quarter ended June 30, 2024 and provided a business update.

Recent corporate updates

• The Phase 1b clinical trial for our lead product candidate, PH-762, received a positive safety recommendation from the Safety Monitoring Committee (SMC). No dose-limiting toxicities or clinically relevant treatment-related adverse events occurred in the initial cohort receiving intratumoral PH-762. The injections were well tolerated. The SMC recommended that the dose be escalated and that the next planned cohort be enrolled in the clinical study.

• The clinical trial is currently enrolling patients for the second^{North Dakota} cohort.

• A fifth clinical trial site has been added to our Phase 1b study of PH-762. The Department of Dermatology at the University of Pittsburgh Medical Center (UPMC) joins four other sites participating in the clinical study: The George Washington University-Medical Faculty Associates in Washington, DC; Banner MD Anderson Cancer Center in Gilbert, Arizona; Integrity Research Clinical Associates in Delray Beach, Florida; and Centricity Research in Dublin, Ohio.

• An additional patent to a family of patents covering INTASYL compounds that treat aging-related skin disorders was recently granted in South Korea. The patent covers the INTASYL compound RXI-185 that treats aging and skin disorders, including photoaging. RXI-185 is a potent silencer of MMP1 expression in the skin, which disrupts ultraviolet radiation (UVR)-induced collagen degradation, thereby improving and/or slowing the progression of skin thickening, elasticity, and wrinkling.

• Phio entered into definitive agreements to exercise certain outstanding warrants to purchase up to an aggregate of 545,286 shares of the Company’s common stock, originally issued between February 2020 and December 2023, with exercise prices ranging from $324.00 to $9.72 per share, at a reduced exercise price of $5.45 per share. The gross proceeds to the Company from the exercise of these warrants were approximately $3.1 million.

• A reverse stock split became effective on July 5, 2024. Each nine (9) common shares of the Company were combined into one (1) common share, with no change in par value of $0.0001 per share. This reduced the Company’s outstanding common shares from approximately 4.6 million shares to approximately 0.5 million shares. The reverse stock split affects all shareholders uniformly and will not alter any shareholder’s percentage ownership of the Company’s common shares, except for any adjustments that may result from the treatment of fractional shares.

• On July 19, 2024, we received written notification from The Nasdaq Stock Market LLC indicating that the Company now meets the $1.00 minimum offer price requirement to continue trading on the Nasdaq Capital Market.

• Phio announced the appointment of Robert M. Infarinato as Vice President and Chief Financial Officer, effective August 1, 2024. He will serve as Chief Financial Officer and will be responsible for accounting, finance, treasury, investor relations and administration.

• We entered into an exploratory collaboration with a multi-billion dollar global skin care company regarding opportunities for Phio’s proprietary compounds for cosmeceutical skin care applications.

Financial results

Cash position

As of June 30, 2024, the Company had cash of $4.7 million compared to $8.5 million as of December 31, 2023.

In July 2024, the Company entered into incentive letter agreements with certain holders of the Company’s existing warrants to purchase up to an aggregate of 545,286 shares of common stock at a reduced exercise price of $5.45 per share. As consideration for the immediate exercise of the existing warrants, the Company has agreed to issue Series C warrants with a term of five and a half years to purchase up to 583,098 shares of common stock and Series D warrants with an eighteen-month term to purchase up to 507,474 shares of common stock, both at an exercise price of $5.45. Net proceeds to the Company are expected to be approximately $2.6 million, after deducting placement agent fees and offering expenses.

Research and development expenses

Research and development expenses were $0.9 million for the three months ended June 30, 2024, compared to $1.4 million for the three months ended June 30, 2023, a decrease of 37%. The decrease was primarily due to a decrease in clinical consulting fees incurred in connection with our IND filing for PH-762 in the prior year period, in addition to the Company’s cost rationalization measures in transitioning from a research company to a product development company, which resulted in decreases in salary-related costs, including stock-based compensation expense, and laboratory supplies associated with the reduction in headcount.

General and administrative expenses

General and administrative expenses were $1.0 million for the three months ended June 30, 2024, compared to $1.2 million for the three months ended June 30, 2023, a decrease of 10%. The decrease was primarily due to decreases in expenses related to the salaries of the Company’s President and CEO and in professional fees related to consulting compared to the prior year period.

Net loss

Net loss was $1.8 million for the three months ended June 30, 2024, compared to $2.5 million for the three months ended June 30, 2023. The decrease in net loss was primarily due to changes in research and development expenses, as described above.

About Phio Pharmaceuticals Corp.

Phio Pharmaceuticals Corp. (NASDAQ: PHIO) is a clinical-stage biotechnology company whose proprietary INTASYL™ RNAi gene silencing technology is designed to make immune cells more effective at killing tumor cells. INTASYL is the only self-delivered RNAi technology focused on immuno-oncology therapy without the need for specialized formulations or drug delivery systems. INTASYL drugs precisely and down-regulate specific proteins that inhibit the body’s ability to overcome chronic diseases and other disorders.

For additional information, please visit the company’s website, www.phiopharma.com.

Forward-looking statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “intends,” “believes,” “anticipates,” “indicates,” “plans,” “expects,” “suggests,” “may,” “should,” “potential,” “designed to,” “will,” “ongoing,” “estimates,” “forecasts,” “target,” “predicts,” “could” and similar references, although not all forward-looking statements contain these words. These statements are based solely on our current beliefs, expectations and assumptions and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are beyond our control. Our actual results may differ materially from those indicated in the forward-looking statements as a result of a number of important factors, including, but not limited to, the impact on our business and operations of inflationary pressures, rising interest rates, recession fears, the development of our product candidates, results of our preclinical and clinical activities, our ability to execute business strategies, our ability to develop our product candidates with collaborative partners and the success of such collaborations, the timeline and duration for advancing our product candidates to clinical development, the timing or likelihood of regulatory filings and approvals, the success of our efforts to commercialize our product candidates if approved, our ability to manufacture and supply our product candidates for clinical activities and for commercial use if approved, the extent of protection we can establish and maintain for the intellectual property rights covering our technology platform, our ability to obtain future financing, market and other conditions and those identified in our Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-K. 10-Q under the heading “Risk Factors” and in other filings the Company makes periodically with the SEC. Readers are urged to review these risk factors and not to act in reliance on any forward-looking statements, as actual results may differ from those contemplated by our forward-looking statements. Phio undertakes no obligation to update any forward-looking statements to reflect a change in its views or events or circumstances occurring after the date of this release, except as required by law.

Contact:
Pharmaceutical company Phio Corp.
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PR Contact
Michael Adams
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PHIO PHARMACEUTICAL CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share and per share data)
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PHIO PHARMACEUTICAL CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
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