HCW Biologics Q1 2024 Financial Results and Highlights

HCW Biologics Inc. (NASDAQ: HCWB), a clinical-stage biopharmaceutical company based in Miramar, Florida, is committed to developing innovative immunotherapies that target the relationship between inflammation and age-related diseases. The company announced its financial results and recent business highlights for the first quarter ending on March 31, 2024.

Founder and CEO Dr. Hing C. Wong highlighted a significant milestone achieved in the first quarter of 2024 with the completion of patient enrollment in two clinical trials evaluating HCW9218 for solid tumors. Despite the inherent challenges of generalizing results from early-phase clinical trials, the company observed promising signs of stable disease in several patients. Wong emphasized the company's strategic focus on advancing HCW9218 into fully randomized Phase 2 clinical trials for difficult-to-treat cancers, such as ovarian and pancreatic cancer, in collaboration with leading clinical sites.

The company also aims to expand its research into age-related conditions, particularly skin diseases and conditions linked to senescence. With an established recommended Phase 2 dose from earlier studies, HCW Biologics plans to undertake investigative studies in these areas, anticipating quicker data readouts compared to cancer trials. The aesthetic effects on deep wrinkles and senile lentigo might be considered as secondary endpoints in these studies.

In terms of financial highlights, HCW Biologics raised $6.1 million in 2024 through private placements of common stock and senior secured notes. The company's ongoing financing strategy includes raising up to $10 million in Secured Notes, with $3.6 million already issued. This bridge financing is expected to support the company's clinical development plans until it can finalize business development transactions such as licensing non-core assets and additional capital raising.

The company completed Phase 1 and Phase 1b clinical trials for HCW9218 in February 2024, successfully determining a recommended Phase 2 dose. An agreement with the University of Pittsburgh Medical Center (UPMC) was established to conduct a Phase 2 trial for HCW9218 in combination with neoadjuvant chemotherapy in patients with metastatic advanced stage ovarian cancer, with patient enrollment expected in the latter half of 2024. Additionally, HCW Biologics is preparing an IND application for HCW9302, an IL-2 based product aimed at expanding Treg cells for autoimmune disease treatment, with plans to submit the application in the third quarter of 2024.

Financially, HCW Biologics reported revenues of $1.1 million for the first quarter of 2024, a significant increase from $41,883 in the same period of 2023, primarily from the sale of licensed molecules to its licensee, Wugen. Research and development expenses decreased slightly to $2.1 million, while general and administrative expenses saw a considerable rise to $6.0 million, largely due to increased legal costs related to ongoing litigation. The company's net loss for the first quarter of 2024 was $7.5 million, compared to $5.1 million in the first quarter of 2023.

As of March 31, 2024, HCW Biologics expressed concerns about its ability to continue as a going concern without additional funding or financial support. Despite cost reductions, the company needs to maintain a core group of scientists to advance its clinical development. The bridge financing through Secured Notes, if fully subscribed, is expected to sustain the company until it can execute further business development and capital-raising plans. However, there remains uncertainty due to ongoing arbitration proceedings with Altor/NantCell.

HCW Biologics remains dedicated to its mission of developing novel immunotherapies that combat age-related diseases by targeting chronic inflammation. With significant progress in its clinical trials and strategic financial planning, the company continues to navigate the challenges of the biopharmaceutical landscape in pursuit of innovative treatments.