Evaxion Reports Q1 2024 Financials and Business Update

Evaxion Biotech A/S, based in Copenhagen, Denmark, is a clinical-stage biotechnology company that utilizes AI-Immunology™ to develop vaccines for various diseases. On May 28, 2024, the company announced their first quarter financial results and provided a business update.

Recent Developments

Since releasing its 2023 financial results, Evaxion has continued progressing with its three-pronged business model, which focuses on identifying targets, expanding its pipeline, and responding to partnerships. Key achievements include:

- Publications: Research has been published in prestigious journals such as the Journal of Cellular Immunology, Journal for ImmunoTherapy of Cancer, and Frontiers in Immunology.
- Conferences: Presentations were made at significant scientific conferences, including the World Vaccine Congress and Immuno 2024.
- Collaborations: Evaxion concluded the final MTA study for the EVX-B1 antigen with a potential partner, with ongoing discussions about future steps.
- Upcoming Events: An announcement was made for the EVX-01 Phase 2 data presentation scheduled at the annual ASCO meeting.

CEO Christian Kanstrup expressed satisfaction with the company's progress and growing external interest in their AI-Immunology™ platform. He emphasized the potential for strong value generation through their multi-partner approach.

2024 Milestones

Evaxion has outlined several milestones for 2024, including:

- EVX-B1: Completion of the MTA study with a potential partner in Q1 2024.
- AI-Immunology™: Launch of the EDEN™ model version 5.0 by mid-2024.
- EVX-B2-mRNA: Preclinical Proof-of-Concept results expected in Q3 2024.
- EVX-01: Phase 2 one-year readout anticipated in Q3 2024.
- EVX-B3: Collaboration with MSD (Merck & Co., Inc.) for target discovery and validation work to conclude in the second half of 2024.
- Precision ERV Cancer Vaccines: Preclinical Proof-of-Concept results expected in the second half of 2024.

The company aims to generate enough business development income in 2024 to cover its cash burn of $14 million, excluding financing activities. However, there are no guarantees this target will be met.

Financial Results

For the first quarter of 2024, Evaxion reported a cash position of $11.7 million, an increase from $5.6 million at the end of 2023. Operating expenses were offset by proceeds from a capital raise and warrant exercises amounting to $11.6 million, including a public offering in February involving MSD Global Health Innovation Fund.

Research and Development expenses for Q1 2024 were $2.8 million, down from $3.9 million in Q1 2023, primarily due to staff reductions and refocused expenses. General and Administrative expenses also decreased to $1.6 million from $2.5 million in the previous year.

Evaxion reported a net income of $1.2 million for Q1 2024, compared to a net loss of $6.2 million in Q1 2023. This improvement was mainly due to the remeasurement of derivative liabilities from investor warrants.

Nasdaq Equity Deficiency

On May 7, 2024, Evaxion received a Nasdaq equity deficiency letter due to the IFRS accounting treatment of investor warrants as derivative liabilities, which affected shareholder equity. The exercise price of these warrants was in USD, while the company's share capital is in DKK. Evaxion has since agreed with holders to convert the exercise price from USD to DKK, removing the derivative liability.

Financial Summary

- Cash and Cash Equivalents (March 31, 2024): $11.7 million
- Total Assets: $22.7 million
- Total Liabilities: $20.0 million
- Total Equity: $2.6 million

Evaxion will need additional funding or income from business development to address the significant doubt about its ability to continue as a going concern past Q1 2025.

Conclusion

Evaxion Biotech A/S remains committed to advancing its AI-Immunology™ platform and developing novel vaccines. Despite financial challenges, the company continues to make significant strides in research and collaboration, positioning itself for future growth.

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