DelMar Pharmaceuticals Announces Fiscal Year 2017 Financial Results

VANCOUVER, British Columbia and MENLO PARK, Calif., Sept. 28, 2017 /PRNewswire/ -- DelMar Pharmaceuticals, Inc. (NASDAQ: DMPI) ("DelMar" or the "Company"), a biopharmaceutical company focused on the development and commercialization of new cancer therapies, announced its financial results for the year ended June 30, 2017. DelMar executive management will host a business update conference call and live webcast for investors, analysts and other interested parties on Wednesday, October 4, 2017 at 4:30 p.m. Eastern Time.

"We are proud of the progress we have made with our research and clinical programs this past year and look forward to continuing to advance VAL-083 toward commercialization as a new treatment for cancer patients with limited or no options," said Jeffrey Bacha, DelMar's president and chief executive officer.

Due to the completion of the financing earlier in September we had cash and clinical trial deposits on hand of approximately $14.3 million (unaudited) as of the date hereof.

RECENT CORPORATE HIGHLIGHTS

    --  In April and September 2017, completed offerings of common stock and
        warrants for aggregate gross proceeds of approximately $19.0 million.
        The Company intends to use the net proceeds of these offerings for its
        clinical trials and general corporate purposes, which may include
        working capital, capital expenditures, research and development and
        other commercial expenditures. In addition, net proceeds from these
        offerings may be allocated for acquisitions or investments in
        businesses, products or technologies that are complementary to Delmar's
        business.
    --  In July 2017, initiated patient recruitment for the STAR-3 pivotal Phase
        3 clinical trial of VAL-083 in refractory GBM and expect to enroll our
        first patient as soon as practicable.
    --  In September 2017, initiated patient recruitment for an open label Phase
        2 clinical trial of VAL-083 in newly diagnosed patients with
        MGMT-unmethylated GBM, which is being conducted with funding support
        through DelMar's collaboration with Guangxi Wuzhou Pharmaceutical
        (Group) Co. Ltd. This trial complements the Company's ongoing open label
        Phase 2 clinical trial in patients with MGMT-unmethylated GBM whose
        tumors have recurred following treatment with temozolomide (bevacizumab
        naïve), which is being conducted in collaboration with the University
        of Texas MD Anderson Cancer Center.
    --  In September 2017, received notice of allowance from the FDA for our
        Phase 1-2 VAL-083 REPROVe clinical trial in Pt-resistant ovarian cancer.
        DelMar will seek to initiate the REPROVe trial as soon as practicable,
        subject to negotiating acceptable clinical research agreements and
        budgets with clinical investigators and their institutions and obtaining
        IRB approvals.
    --  Presented promising research results supporting the potential of VAL-083
        in the treatment of a range of cancers for patients whose tumors exhibit
        features making them resistant to, or unlikely to respond to, currently
        available therapies. For example:
        --  Presented data supporting the effectiveness of VAL-083 in the
            treatment of GBM at the annual meetings of the American Society for
            Clinical Oncology ("ASCO"), the American Association of Cancer
            Research ("AACR"), the World Federation of NeuroOncology Societies
            ("WFNOS"), the European Association for NeuroOncology and the
            Society for NeuroOncology ("SNO");
        --  Presented data supporting the effectiveness of VAL-083 in the
            treatment of lung cancer at the AACR Annual Meeting, the 17(th)
            World Congress on Lung Cancer and the AACR New Horizons in Cancer
            Research Conference;
        --  Presented data supporting the activity of VAL-083 in
            treatment-resistant medulloblastoma both as a single agent and in
            combination with topoisomerase inhibitors at the SNO Pediatric
            Oncology Symposium and at the AACR Advances in Pediatric Research:
            From Mechanisms and Models to Treatment and Survivorship Conference;
            and
        --  Presented data supporting the effectiveness of VAL-083 against
            chemotherapy-resistant ovarian cancers at the 11(th) Biennial
            Ovarian Cancer Research Symposium.
    --  Continued to strengthen and expand network of research collaborations
        with leading academic institutions including the announcement of a major
        sponsored research agreement with Duke University to evaluate VAL-083 as
        a front-line treatment for newly diagnosed patients with GBM.
    --  Continued to strengthen the Company's intellectual property portfolio.
        DelMar now holds eight issued US patents and eight issued patents
        outside of the US. We have fourteen patent families in various stages of
        prosecution, and over 100 patent filings in total.
    --  Strengthened Board of Directors and corporate governance with the
        addition of Saiid Zarrabian and the appointment of Dr. Erich Mohr as
        independent chairman.

CONFERENCE CALL DETAILS

DelMar plans to host a conference call to discuss its financial results for the year ended June 30, 2017 and provide a corporate update on Wednesday, October 4, 2017, at 4:30 p.m. Eastern Time. For both "listen-only" participants and those who wish to take part in the question and answer portion of the call, the telephone Dial-in Number is 866-831-8713 (toll free) with Conference ID DELMAR.

Listeners can also attend the call via webcast. A link to the webcast and slides will be available on the IR Calendar of the Investors section of the Company's website at www.delmarpharma.com and will be archived for 30 days.

SUMMARY OF FINANCIAL RESULTS FOR THE FISCAL YEAR 2017 ENDED JUNE 30, 2017

At June 30, 2017, the Company had cash and clinical trial deposits on hand of approximately $7.6 million and as of the date hereof, we had cash and clinical trial deposits on hand of approximately $14.3 million (unaudited).

For the year ended June 30, 2017, the Company reported a net loss of $8,081,764 or $0.74 per share, compared to a net loss of $8,864,864, or $0.83 per share, for the year ended June 30, 2016.

The following represents selected financial information as of June 30, 2017. The Company's financial information has been prepared in accordance with U.S. GAAP and this selected information should be read in conjunction with DelMar's consolidated financial statements and management's discussion and analysis ("MD&A"), as filed.

DelMar's financial statements as filed with the U.S. Securities Exchange Commission can be viewed on the company's website at: http://ir.delmarpharma.com/all-sec-filings.


           Selected Balance Sheet Data
           ---------------------------


                                       June 30,           June 30,

                                           2017                2016

                                              $                  $
                                            ---                ---


    Cash and cash equivalents                   6,586,014           6,157,264

    Working capital                             6,566,371           5,692,336

    Total assets                                7,911,021           6,355,799

    Derivative liability                           61,228             693,700

    Total stockholders' equity                  6,578,524           4,858,778


    Selected Statement of Operations Data
    -------------------------------------

    For the Years Ended:


                                          June 30,            June 30,

                                              2017                   2016

                                                 $                     $
                                               ---                   ---


    Research and development                        5,003,640              3,360,878

    General and administrative                      3,317,189              2,853,140

    Change in fair value of
     stock option and
     derivative liabilities                         (245,963)             2,341,660

    Change in fair value of
     derivative liability due
     to change in warrant
     terms                                                  -               295,456

    Foreign exchange loss                               7,355                 13,838

    Interest income                                     (457)                 (108)
                                                         ----                   ----

    Net and comprehensive loss
     for the period                                 8,081,764              8,864,864

    Series B Preferred stock
     dividend                                         790,454                238,326
                                                      -------                -------

    Net and comprehensive loss
     available to common
     stockholders                                   8,872,218              9,103,190

    Basic weighted average
     number of shares
     outstanding                                   12,047,079             10,948,481

    Basic and fully diluted
     loss per share                                      0.74                   0.83

Excluding the impact of non-cash expense, research and development expenses increased to $4,900,812 during the current year from $2,831,901 for the prior year. The increase was largely attributable to an increase in clinical costs related to the initiation of the STAR-3 trial, preclinical research, intellectual property, and personnel costs during the year ended June 30, 2017 compared to the year ended June 30, 2016.

Excluding the impact of non-cash expenses, general and administrative expenses increased in the year ended June 30, 2017 to $2,649,668 from $2,193,183 for the year ended June 30, 2016. The increase was primarily due to an increase in professional fees, office and sundry, and personnel costs partially offset by a decrease in travel.

We believe, based on our current estimates, that we will be able to fund our operations beyond the next twelve months.

About VAL-083

VAL-083 (dianhydrogalactitol) is a "first-in-class", DNA-targeting agent that introduces interstrand DNA cross-links at the N7-position of guanine leading to DNA double-strand breaks and cancer cell death. VAL-083 has demonstrated clinical activity against a range of cancers including GBM in historical clinical trials sponsored by the U.S. National Cancer Institutes (NCI).

VAL-083 has been granted an orphan drug designation by the U.S. FDA Office of Orphan Products for the treatment of glioma, medulloblastoma and ovarian cancer, and in Europe for the treatment of malignant gliomas. VAL-083 is currently being studied in multiple clinical trials as a potential new treatment for glioblastoma multiforme (GBM), the most common and aggressive form of brain cancer.

DelMar has demonstrated that VAL-083's mechanism of action is distinct from multiple chemotherapies widely used in the treatment of cancer and that this unique mechanism may offer opportunities to overcome treatment resistance thereby offering new treatment options to cancer patients. Further details regarding these studies can be found at http://www.delmarpharma.com/scientific-publications.html.

About DelMar Pharmaceuticals, Inc.

DelMar is focused on the development and commercialization of new therapies for cancer patients who have limited or no treatment options. By focusing on understanding tumor biology and mechanisms of treatment resistance, the Company identifies biomarkers to personalize new therapies in indications where patients are failing, or have become intolerable to, modern targeted or biologic treatments.

The Company's current pipeline is based around VAL-083, a "first-in-class," small-molecule chemotherapeutic with a novel mechanism of action that has demonstrated clinical activity against a range of cancers including central nervous system, ovarian and other solid tumors (e.g. NSCLC, bladder cancer, head & neck) in U.S. clinical trials sponsored by the NCI. Based on DelMar's internal research programs and these prior NCI-sponsored clinical studies, the Company is conducting clinical trials to support the development and commercialization of VAL-083 across multiple oncology indications to solve significant unmet medical needs.

The STAR-3 trial is a multi-center, pivotal, randomized Phase 3 clinical study in bevacizumab (Avastin®) recurrent GBM. Outcomes in DelMar's recent Phase 1-2 clinical trials suggest that VAL-083 may offer a clinically meaningful survival benefit for this patient population.

VAL-083 is also being studied in two collaborator-supported, biomarker driven, Phase 2 clinical trials for MGMT-unmethylated GBM as a potential alternative for the majority of GBM patients whose tumors exhibit high expression of MGMT, a biomarker correlated with resistance to the current standard-of-care chemotherapy. Overcoming MGMT-mediated resistance represents a significant unmet medical need in the treatment of GBM.

The VAL-083 REPROVe trial will explore VAL-083 in platinum-resistant ovarian cancer. Resistance to platinum-based chemotherapy represents a significant unmet medical need in the treatment of ovarian cancer.

Further information on DelMar's clinical trials can be found on clinicaltrials.gov: https://www.clinicaltrials.gov/ct2/results?cond=&term=val-083&cntry1=&state1=&recrs

For further information, please visit http://delmarpharma.com/; or contact DelMar Pharmaceuticals Investor Relations: ir@delmarpharma.com / (604) 629-5989.

Connect with the Company on Twitter, LinkedIn, Facebook, and Google+.

Safe Harbor Statement

Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the Company's ability to develop, market and sell products based on its technology; the expected benefits and efficacy of the Company's products and technology; the availability of substantial additional funding for the Company to continue its operations and to conduct research and development, clinical studies and future product commercialization; and, the Company's business, research, product development, regulatory approval, marketing and distribution plans and strategies. These and other factors are identified and described in more detail in our filings with the SEC, including, our current reports on Form 8-K.


    DelMar Pharmaceuticals, Inc.

    Consolidated Balance Sheet


    (in US dollars unless otherwise noted)


                                           Note     June 30,                 June 30,
                                                          2017                   2016
                                                             $                     $
                                                           ---                   ---

    Assets


    Current assets

    Cash                                                          6,586,014               6,157,264

    Prepaid expenses and deposits                 8                1,208,122                 144,131

    Taxes and other receivables                                      76,595                  18,387
                                                                     ------                  ------

                                                                  7,870,731               6,319,782

    Intangible assets - net                                          40,290                  36,017
                                                                     ------                  ------

                                                                  7,911,021               6,355,799
                                                                  =========               =========


    Liabilities


    Current liabilities

    Accounts payable and accrued
     liabilities                                                  1,182,312                 584,002

    Related party payables                        6                   88,957                  43,444

    Current portion of derivative
     liability                                    4                   33,091                       -
                                                                     ------                     ---


                                                                  1,304,360                 627,446


    Stock option liability                        5                        -                175,875


    Derivative liability                          4                   28,137                 693,700
                                                                     ------                 -------


                                                                  1,332,497               1,497,021
                                                                  ---------               ---------

    Stockholders' accumulated equity


    Preferred stock

    Authorized

    5,000,000 shares, $0.001 par
     value

    Issued and outstanding

    278,530 Series A shares at June
     30, 2017 (June 30, 2016 -
     278,530)                                   3,5                  278,530                 278,530

    881,113 Series B shares at June
     30, 2017 (June 30, 2016 -
     902,238)                                     5                6,146,880               6,294,255

    1 special voting share at June
     30, 2017 (June 30, 2016 - 1)                                         -                      -


    Common stock

    Authorized

    50,000,000 shares, $0.001 par
     value

    14,509,633 issued at June 30,
     2017 (June 30, 2016 -
     11,187,023)                                  5                   14,510                  11,187


    Additional paid-in capital                    5               36,665,285              28,833,105


    Warrants                                      5                4,570,574               1,658,382


    Accumulated deficit                                        (41,118,433)           (32,237,859)


    Accumulated other comprehensive
     income                                                          21,178                  21,178
                                                                     ------                  ------


                                                                  6,578,524               4,858,778
                                                                  ---------               ---------


                                                                  7,911,021               6,355,799
                                                                  =========               =========


    DelMar Pharmaceuticals, Inc.

    Consolidated Statement of Operations and Comprehensive Loss


    (in US dollars unless otherwise noted)


                                                           Note     Year ended               Year
                                                                    June 30,                ended
                                                                          2017             June 30,
                                                                             $                 2016
                                                                                                  $
                                                                                                ---


    Expenses

    Research and development                                      6              5,003,640            3,360,878

    General and administrative                                    6              3,317,189            2,853,140
                                                                                ---------            ---------


                                                                                8,320,829            6,214,018
                                                                                ---------            ---------


    Other loss (income)

    Change in fair value of stock
     option and derivative
     liabilities                                                4,5              (245,963)           2,341,660

    Change in fair value of
     derivative liability due to
     change in warrant terms                                                            -             295,456

                                                                4,5

    Foreign exchange loss                                                           7,355               13,838

    Interest income                                                                 (457)               (108)
                                                                                     ----                 ----


                                                                                (239,065)           2,650,846
                                                                                 --------            ---------


    Net and comprehensive loss for
     the year                                                                   8,081,764            8,864,864
                                                                                =========            =========


    Computation of basic loss per
     share

    Net and comprehensive loss for
     the year                                                                   8,081,764            8,864,864

    Series B Preferred stock dividend                             5                790,454              238,326
                                                                                  -------              -------

                                                                                8,872,218            9,103,190
                                                                                =========            =========


    Basic and fully diluted loss per
     share                                                                           0.74                 0.83
                                                                                     ====                 ====


    Basic weighted average number of
     shares                                                                    12,047,079           10,948,481
                                                                               ==========           ==========


    The accompanying notes are an
     integral part of these consolidated
     financial statements.


    DelMar Pharmaceuticals, Inc.

    Consolidated Statement of Cash Flows


    (in US dollars unless otherwise noted)


                                                         Years ended June 30,
                                                         --------------------

                                                    2017                       2016

                                           Note        $                         $
                                           ----      ---                       ---

    Cash flows from
     operating
     activities

    Loss for the
     period                                                       (8,081,764)       (8,864,864)

    Items not
     affecting cash

    Amortization of
     intangible
     assets                                                            16,683             10,288

    Change in fair
     value of stock
     option and
     derivative
     liabilities                                4,5                  (245,963)         2,341,660

    Change in fair
     value of
     derivative
     liability due
     change in
     warrant terms                              4,5                          -           295,456

    Shares issued
     for services                                 5                    564,000            146,900

    Warrants issued
     for services                                 5                     81,602            647,902

    Stock option
     expense                                      5                    124,747            394,132


    Changes in non-
     cash working
     capital

    Prepaid expenses
     and deposits                                 8                (1,063,991)           100,907

    Taxes and other
     receivables                                                     (58,208)             7,444

    Accounts payable
     and accrued
     liabilities                                                      598,310          (178,263)

    Related party
     payables                                     6                     45,513           (47,376)
                                                                       ------            -------

                                                                  (8,019,071)       (5,145,814)
                                                                   ----------         ----------


    Cash flows from
     investing
     activities

    Intangible
     assets -
     website
     development
     costs                                                           (20,956)          (16,762)
                                                                      -------            -------

                                                                     (20,956)          (16,762)
                                                                      -------            -------

    Cash flows from
     financing
     activities

    Net proceeds
     from the
     issuance of
     shares and
     warrants                                     5                  7,932,107          2,453,633

    Net proceeds
     from the
     issuance of
     Series B
     Preferred Stock                              5                          -         6,540,821

    Proceeds from
     the exercise of
     warrants                                     5                    545,026            579,309

    Series A
     preferred stock
     dividend                                     5                    (8,356)           (8,356)
                                                                       ------             ------


                                                                    8,468,777          9,565,407
                                                                    ---------          ---------


    Increase in cash
     and cash
     equivalents                                                      428,750          4,402,831


    Cash - beginning
     of year                                                        6,157,264          1,754,433
                                                                    ---------          ---------


    Cash - end of
     year                                                           6,586,014          6,157,264
                                                                    =========          =========

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SOURCE DelMar Pharmaceuticals, Inc.