biotickrKiromic BioPharma, Inc. is a clinical-stage, fully integrated biotherapeutics company using its proprietary DIAMOND® artificial intelligence (AI) platform to discover and develop cell therapies with a therapeutic focus on immuno-oncology. Kiromic Biopharma is the only cell therapy company combining genetically edited Gamma Delta CAR-T (GD CAR-T) cells with proprietary targeting technology to address solid malignancies.
Kiromic is in the process of developing ALEXIS, a multi-indication allogeneic CAR-T cell therapy platform that exploits the natural potency of gamma delta T-cells to target solid cancers. Kiromic is focused on discovering, developing, and commercializing novel immuno-oncology applications through its robust product pipeline.
The pipeline development is leveraged through the Company’s proprietary target discovery engine called DIAMOND AITM. Kiromic’s DIAMOND AITM is where data science meets target identification to dramatically compress the years and millions of dollars required to develop a cellular therapeutic.
Recent Events
- May 11, 2022 – Company Provides Regulatory Update on Progress to Address Previously Outlined Chemistry, Manufacturing, and Control (CMC) Issues Related to Clinical Hold on Investigational New Drug Applications (INDs)
- June 7, 2022 – Kiromic Biopharma entered into a sponsored research agreement (SRA) with Principal Investigator James W. Welsh, M.D. of The University of Texas MD Anderson Cancer Center. Under the two-year SRA, in vivo preclinical data will be generated from Kiromic’s Gamma Delta T cell (GDT) allogeneic therapies. This SRA is intended to evaluate efficacy and patient safety outcomes to support three new investigational drug (IND) applications to the U.S. Food and Drug Administration (FDA).
- July 13, 2022 Kiromic files S-1/A with SEC to amend IPO registration for a public offering
- August 19, 2022 – The Company has determined not to pursue, at this time, the contemplated public offering to which the Registration Statement relates. The Company confirms that no securities have been sold pursuant to the Registration Statement.
Addressable Market
- Global CAR-T Cell Therapy Market by 2027 to exceed 33+ billion[i]
- 90% of call cancers are solid malignancies[ii]
Current Finances
- Cash Position $6,510,600 as of Q2 2022 10-Q filing
This is a huge red flag given the cash burn noted in previous 10-Q and 10-K filings. The company currently has 300,000,000 shares authorized as of June 30, 2022, and December 31, 2021; 15,839,112 and 15,488,516 shares issued and outstanding as of June 30, 2022, and December 31, 2021, respectively. The Company had negative cash flow from operations of $13,548,000 for the six months ended June 30, 2022, and an accumulated deficit of $83,019,400 as of June 30, 2022. To date, the Company has relied on equity and debt financing to fund its operations. The Company’s product candidates are still in the early stages of development, and substantial additional financing will be needed by the Company to fund its operations and ongoing research and development efforts prior to the commercialization, if any, of its product candidates. The Company does not have sufficient cash on hand or available liquidity to meet its obligations through the twelve months following the date the condensed consolidated financial statements are issued.[iii]
Insider Activity
No voluntary insider purchases were found within the last 12-month period ending 19 September 2022. All insider acquisitions were grant based compensation.[iv]
This is another red flag as any biotech company with near-term positive catalysts known internally may reflect this via insider purchases.
Legal Issues
A class action lawsuit has been filed on behalf of those who purchased or acquired Kiromic BioPharma, Inc. (“Kiromic”) (NASDAQ: KRBP) common stock between June 25, 2021, and August 5, 2022, inclusive (the “Class Period”). This is related to investors being misled by information pertaining to the FDA hold on multiple INDs not being communicated prior to the IPO date. Following the IPO date Kiromic cryptically released this information to investors. A sharp decline in share value quickly followed. A short video regarding this class-action suit can be found here.
Legal actions are common in the biotech industry for a plethora of reasons. Many end up in settlements with minor impact to a company’s continued operation. It is, however, another red flag as this specific suit indicates failure of the company’s fiduciary responsibility to shareholders which is critical.
Summary
Given the preliminary stages of pipeline development, holds placed by the FDA, and current cash position Kironic Biopharma is ripe for further dilution to fund operations. The timeline set by the company puts early pre-clinical data from leading INDs is at least a year away following submission to the FDA in late 2022. Given the current macroeconomics at play and immediate dilution risk, investment at this time can pose a significant risk. The company’s unique approach to utilize AI in the CAR-T space could pay out down the road when looking at current efficacy and safety data for Procel and Isocel. (Pages 18-19 in prospectus)
[i] https://www.researchandmarkets.com/reports/5410182/global-car-t-cell-therapy-market-by-product
[ii] American Cancer Society, Cancer Facts & Figures, 2022.. https://www.cancer.org/research/cancer-facts-statistics.html
[iii] https://docoh.com/filing/1792581/0001558370-22-013504/KRBP-10Q-2022Q2
[iv] https://docoh.com/company/1792581/KRBP/insider-ownership-history