Form: 10-Q

Quarterly report pursuant to Section 13 or 15(d)

May 8, 2017

Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2017

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 001-13467

 

 

HedgePath Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   30-0793665

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

324 S. Hyde Park Avenue Ste. 350

Tampa, FL

  33606
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number (including area code): 813-864-2559

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer   ☐  (Do not check if a smaller reporting company)    Smaller reporting company  
    

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of May 8, 2017, there were 369,599,266 shares of company common stock issued and outstanding.

 

 

 


Table of Contents

HedgePath Pharmaceuticals, Inc.

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

 

         Page  

Part I. Financial Information

 

Item 1.

 

Condensed Financial Statements (unaudited)

  
 

Condensed Balance Sheets as of March 31, 2017 and December  31, 2016

     3  
 

Condensed Statements of Operations for the three months ended March  31, 2017 and 2016

     4  
 

Condensed Statement of Stockholders’ Equity for the three months ended March 31, 2017

     5  
 

Condensed Statements of Cash Flows for the three months ended March  31, 2017 and 2016

     6  
 

Notes to Condensed Financial Statements

     7  

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

     10  

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

     11  

Item 4.

 

Controls and Procedures

     11  

Cautionary Note on Forward Looking Statements

     11  

Part II. Other Information

  

Item 1

 

Legal Proceedings

     12  

Item 1A.

 

Risk Factors

     12  

Item 2

 

Unregistered Sales of Equity Securities and Use of Proceeds

     12  

Item 3

 

Defaults upon Senior Securities

     12  

Item 4

 

Mine Safety Disclosures

     12  

Item 5

 

Other Information

     12  

Item 6.

 

Exhibits

     12  

Signatures

     S-1  


Table of Contents

HEDGEPATH PHARMACEUTICALS, INC.

CONDENSED BALANCE SHEETS

AS OF MARCH 31, 2017 AND DECEMBER 31, 2016

(Unaudited)

 

     March 31, 2017     December 31, 2016  
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 2,339,817     $ 6,885,422  

Prepaid expenses

     51,038       61,097  

Deposit

     250,000       250,000  
  

 

 

   

 

 

 

Total current assets

     2,640,855       7,196,519  

Other long term assets

     134,253       141,576  
  

 

 

   

 

 

 

Total assets

   $ 2,775,108     $ 7,338,095  
  

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY     

Current liabilities:

    

Accounts payable

   $ 339,691     $ 297,826  

Other liabilities

     56,116       10,307  
  

 

 

   

 

 

 

Total current liabilities

     395,807       308,133  
  

 

 

   

 

 

 

Total liabilities

     395,807       308,133  
  

 

 

   

 

 

 

Commitments and contingencies (note 5)

     —         —    

Stockholders’ equity:

    

Series A Preferred Stock, $0.0001 par value; 500,000 shares authorized; no shares issued and outstanding.

     —         —    

Undesignated Preferred Stock, $0.0001 par value; 9,500,000 shares authorized; no shares issued or outstanding.

     —         —    

Common stock, $0.0001 par value; 500,000,000 shares authorized; 369,186,766 and 353,447,172 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively

     36,919       35,345  

Additional paid-in capital

     48,316,564       50,167,372  

Accumulated deficit

     (45,974,182     (43,172,755
  

 

 

   

 

 

 

Total stockholders’ equity

     2,379,301       7,029,962  
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 2,775,108     $ 7,388,095  
  

 

 

   

 

 

 

See notes to condensed financial statements

 

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HEDGEPATH PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF OPERATIONS

FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2017 AND 2016

(Unaudited)

 

     Three Months Ended March 31,  
     2017     2016  

Revenues:

   $ —       $ —    
  

 

 

   

 

 

 

Total Revenues

     —         —    
  

 

 

   

 

 

 

Expenses:

    

Research and development expenses

     818,338       582,513  

General and administrative

     1,994,734       611,952  
  

 

 

   

 

 

 

Total Expenses:

     2,813,072       1,194,465  
  

 

 

   

 

 

 

Loss from operations

     (2,813,072     (1,194,465

Interest income

     11,645       —    
  

 

 

   

 

 

 

Net loss

   $ (2,801,427   $ (1,194,465
  

 

 

   

 

 

 

Basic and diluted net loss per share

   $ (0.01   $ (0.00
  

 

 

   

 

 

 

Weighted average common stock shares outstanding

     357,644,397       245,353,270  
  

 

 

   

 

 

 

See notes to condensed financial statements

 

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HEDGEPATH PHARMACEUTICALS, INC.

CONDENSED STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2017

(Unaudited)

 

     Common Stock      Additional
Paid-In
Capital
    Accumulated
Deficit
    Total
Stockholders’
Equity
 
     Shares      Amount         

Balances, January 1, 2017

     353,447,172      $ 35,345      $ 50,167,372     $ (43,172,755   $ 7,029,962  

Issuance of common stock in payment of vested restricted stock units, net

     15,739,594        1,574        (3,679,301     —         (3,677,727

Stock based compensation

     —          —          1,828,493       —         1,828,493  

Net loss

     —          —          —         (2,801,427     (2,801,427
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Balances, March 31, 2017

     369,186,766      $ 36,919      $ 48,316,564     $ (45,974,182   $ 2,379,301  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

See notes to condensed financial statements

 

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Table of Contents

HEDGEPATH PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(Unaudited)

 

     Three Months Ended
March 31,
 
     2017     2016  

Operating activities:

    

Net loss

   $ (2,801,427   $ (1,194,465

Adjustments to reconcile net loss to net cash flows from operating activities:

    

Stock based compensation

     1,828,493       447,696  

Changes in assets and liabilities:

    

Prepaid expense and other assets

     17,382       (17,603

Accounts payable and other current liabilities

     87,674       281,550  
  

 

 

   

 

 

 

Net cash used in operating activities

     (867,878     (482,822
  

 

 

   

 

 

 

Financing activities:

    

Net settlement in connection with the issuance of shares associated with underlying Restricted Stock Units (note 4)

     (3,677,727     —    
  

 

 

   

 

 

 

Net cash used in financing activities

     (3,677,727     —    
  

 

 

   

 

 

 

Net change in cash and cash equivalents

     (4,545,605     (482,822

Cash and cash equivalents at beginning of period

     6,885,422       601,445  
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 2,339,817     $ 118,623  
  

 

 

   

 

 

 
     2017     2016  

Non-cash investing activities:

    

Fair value of shares withheld with net settlement transaction (note 4)

   $ 3,677,727     $ —    

See notes to condensed financial statements

 

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HEDGEPATH PHARMACEUTICALS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(Unaudited)

 

1. Corporate overview:

Overview

The accompanying unaudited condensed financial statements of HedgePath Pharmaceuticals, Inc., a Delaware corporation (the “Company”, “HPPI”, “we”, “us” or similar terminology), have been prepared by the Company without audit. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows as of March 31, 2017, and for all periods presented, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to the Securities and Exchange Commission (“SEC”) rules and regulations. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2016, which are included in the Company’s 2016 Annual Report on Form 10-K, filed with the SEC on February 17, 2017 (the “2016 Annual Report”). The accompanying condensed balance sheet as of December 31, 2016 has been derived from the audited financial statements at that date, but does not include all information and footnotes required by GAAP for complete financial statements.

As used herein, the term “Common Stock” means the Company’s common stock, $0.0001 par value per share.

The results of operations for the three month period ended March 31, 2017 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year. Readers of this Quarterly Report are strongly encouraged to review the risk factors relating to the Company which are set forth in the 2016 Annual Report on Form 10-K and our other filings with the SEC.

The accompanying financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities of the Company in the normal course of business. If the Company is unable to raise required funding to continue to pursue its business plan, it may have to cease operations. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Nature of the Business and Background

The Company is a clinical stage biopharmaceutical company that is seeking to discover, develop and commercialize innovative therapeutics for patients with certain cancers. The Company may also explore acquiring or licensing other innovative therapeutics addressing unmet needs and orphan indications beyond cancer. The Company’s preliminary focus is on the development of therapies for skin, lung and prostate cancers in the U.S. market, with the first indication targeting basal cell carcinoma in patients with Basal Cell Carcinoma Nevus Syndrome (also known as Gorlin Syndrome) for which the Company commenced a Phase II(b) clinical trial in the third quarter of 2015 and for which the Company announced positive interim data in August and October 2016.

The Company’s proposed therapy is based upon the use of SUBA-Itraconazole, which is a patented, oral formulation of the currently marketed anti-fungal drug itraconazole. The Company believes that the dosing of oral capsules of this formulation can affect the Hedgehog signaling pathway, a major regulator of many fundamental cellular processes, which, in turn, can impact the development and growth of cancers such as basal cell carcinoma. Itraconazole has been approved by the U.S. Food and Drug Administration (the “FDA”) for, and has been extensively used to, treat fungal infections and has an extensive history of safe and effective use in humans. The Company has developed, optioned and licensed intellectual property and know-how related to the treatment of cancer patients using itraconazole.

Relationship with Mayne Pharma Ventures Pty Ltd.

The Company has exclusive rights in the U.S. to develop and to commercialize SUBA-Itraconazole capsules for the treatment of human cancer via oral administration. SUBA-Itraconazole was developed and is licensed to us by the Company’s manufacturing partner and majority shareholder Mayne Pharma Ventures Pty Ltd. and its affiliates (“Mayne Pharma”) under a supply and license agreement, originally dated September 3, 2013, as amended and restated on May 15, 2015, and further amended on November 22, 2016 (the “SLA”). Mayne Pharma is an Australian specialty pharmaceutical company that develops and manufactures branded and generic products, which it distributes directly or through distribution partners and also provides contract development and manufacturing services. In addition to being the Company’s licensor and supply partner, under the SLA and related agreements, Mayne Pharma holds a majority equity stake in the Company and holds important contractual rights with respect to the Company, such as the right to maintain its percentage ownership of the Company in connection with equity financings.

 

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HEDGEPATH PHARMACEUTICALS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(Unaudited)

 

2. Liquidity and management’s plans:

The Company had cash and cash equivalents of approximately $2.3 million as of March 31, 2017. Based on the Company’s current operational plan and budget, the Company expects that it has sufficient cash to manage its business into approximately the first quarter of 2018, although this estimation assumes the Company does not accelerate the development of the existing product candidate, acquire other drug development opportunities, or otherwise face unexpected events, costs or contingencies, any of which could affect the Company’s cash requirements. The Company intends to finance its research and development, commercialization and distribution efforts and its working capital needs primarily through:

 

  •   proceeds from public and private financings and, potentially, from strategic transactions;

 

  •   proceeds from the exercise of warrants issued in public and private financings;

 

  •   potential partnerships with other pharmaceutical companies to assist in the supply, manufacturing and distribution of its products for which the Company would expect to receive upfront milestone and royalty payments;

 

  •   potential licensing and joint venture arrangements with third parties, including other pharmaceutical companies where the Company would receive funding based on out-licensing its product; and

 

  •   seeking government or private foundation grants which would be awarded to the Company to further develop its current and future anti-cancer therapies.

However, there is a material risk that none of these plans will be implemented in a manner necessary to sustain the Company for an extended period of time and that the Company will be unable to obtain additional financing when needed on commercially reasonable terms, if at all. If adequate funds are not available when needed, the Company may be required to significantly reduce or refocus operations or to obtain funds through arrangements that may require the Company to relinquish rights to technologies or potential markets, any of which could have a material adverse effect on the Company, its viability, its financial condition and its results of operations beyond the first quarter of 2018. To the extent that additional capital is raised through the sale of equity or convertible debt securities or exercise of warrants and options, the issuance of such securities would result in ownership dilution to existing stockholders.

 

3. Summary of Significant Accounting Policies:

Estimates

The preparation of condensed financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

Revenue Recognition

The Company currently has no ongoing source of revenues. Miscellaneous income is recognized when earned by the Company.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. At times, the Company may maintain cash balances in excess of Federal Deposit Insurance Corporation insured amounts which is $250,000 for substantially all depository accounts. As of March 31, 2017, the Company had approximately $1.8 million in excess of the amount covered by Federal Deposit Insurance Corporation with one financial institution.

Research and Development Expenses

Research and development costs are expensed in the period in which they are incurred and include the expenses paid to third parties who conduct research and development activities on behalf of the Company and purchased in-process research and development.

 

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HEDGEPATH PHARMACEUTICALS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2017 AND 2016

(Unaudited)

 

3. Summary of Significant Accounting Policies (continued):

 

Stock-Based Compensation

The Company accounts for stock-based awards to employees and non-employees using Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 – Accounting for Share-Based Payments, which provides for the use of the fair value based method to determine compensation for all arrangements where shares of stock or equity instruments are issued for compensation. Fair values of restricted stock units issued are determined by the Company based predominantly on the trading price of the common stock on the date of grant. Fair value of each common stock option is estimated on the date of grant using the Black-Scholes valuation model that uses assumptions for expected volatility, expected dividends, expected term, and the risk-free interest rate. Expected volatility is based on historical volatility of a peer group’s common stock and other factors estimated over the expected term of the options. The expected term of the options granted is derived using the “simplified method” which computes expected term as the average of the sum of the vesting term plus the contract term. The risk-free rate is based on the U.S. Treasury yield.

Income Taxes

Deferred tax assets and liabilities are recognized for future tax consequences attributed to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases and are measured using enacted tax rates that are expected to apply to the differences in the periods that they are expected to reverse. These differences occur primarily in share-based compensation, in-process research and development, and net operating loss carry forward.

Recent accounting pronouncements:

Management has considered all recent accounting pronouncements issued, but not effective, and does not believe that they will have a significant impact on the Company’s financial statements.

 

4. Stockholders’ Equity:

Employee Stock Plans

Total stock-based compensation for the three months ended March 31, 2017 was approximately $1.8 million and is related to certain restricted stock units (“RSUs”) issued pursuant to the Company’s 2014 Equity Incentive Plan. The expense is classified as research and development expense and general and administrative expense in the accompanying condensed statements of operations. The grant date fair value of RSUs was determined using the quoted market price of the Common Stock on the date of issuance and the number of shares expected to vest. As of March 31, 2017, there were 650,000 outstanding common stock options vested and outstanding.

On March 8, 2017, approximately 26.5 million previously vested but unpaid RSUs were settled by issuing shares of Common Stock as described below. Upon payment of the RSUs, the Company issued 15,739,594 shares of Common Stock to employees, current and former Board members, and contractors (“RSU recipients”). Additionally, 10,802,144 shares of Common Stock, valued at approximately $3.7 million, were withheld from issuance representing estimated income taxes due from the RSU recipients as the fair value of the shares is considered taxable income upon issuance. The Company subsequently remitted to the appropriate taxing authorities in cash both the Company and the RSU recipient portions of the tax withholdings in the amount of approximately $3.7 million. Accordingly, as of March 31, 2017, there are no outstanding RSUs.

There was no unamortized stock-based compensation relating to RSUs at March 31, 2017.

 

5. Legal Proceedings:

The Company is currently not subject to any legal proceedings. However, the Company may from time to time become a party to various legal proceedings arising in the ordinary course of business.

 

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the Condensed Financial Statements and Notes thereto included elsewhere in this Quarterly Report. This discussion contains certain forward-looking statements that involve risks and uncertainties. The Company’s actual results and the timing of certain events could differ materially from those discussed in these forward-looking statements as a result of certain factors, including, but not limited to, those set forth herein and elsewhere in this Quarterly Report and in the Company’s other filings with the SEC. See “Cautionary Note Regarding Forward Looking Statements” below.

As used in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, unless otherwise indicated, the terms “the Company”, “we”, “us”, “our” and similar terminology refer to both, as the context requires, the present activity of HPPI and the historic activity of CBI, as the context requires.

Critical Accounting Policies

See Note 3 of the Notes to Condensed Financial Statements included in Item 1 of this Quarterly Report for a summary of significant accounting policies and information on recently issued accounting pronouncements.

Results of Operations

For the three months ended March 31, 2017 compared to the three months ended March 31, 2016

Research and Development Expenses. We recognized approximately $0.8 million in research and development expenses during the three months ended March 31, 2017 compared to approximately $0.6 million for the three months ended March 31, 2016. Research and development expenses for both periods primarily include expenses related to our clinical trial for Basal Cell Carcinoma Nevus Syndrome, regulatory activities, legal expenses relating to patents, and stock-based compensation. The increase is due primarily to increased employee salaries and related taxes that began in July 2016 and increased stock compensation relating to the revaluation of RSUs due to the change in control which occurred in November 2016.

General and Administrative Expenses. We recognized approximately $2.0 million in general and administrative expenses during the three months ended March 31, 2017 compared to $0.6 million for the three months ended March 31, 2016. General and administrative expenses consist primarily of compensation and related costs for corporate administrative staff and Board members, facility expenditures, professional fees, consulting and taxes. The increase is due primarily to increased employee and Board salaries and related taxes that began in July 2016 and increased stock compensation relating to the revaluation of RSUs due to the change in control which occurred in November 2016.

Interest Income. We recognized interest income of $11,645 during the three months ended March 31, 2017 for interest earned on cash balances in our money market account. There was no interest income during the three months ended March 31, 2016.

Liquidity and Capital Resources

We had approximately $2.3 million cash on hand at March 31, 2017.

We intend to seek additional financing for our research and development, commercialization and distribution efforts and our working capital needs primarily through:

 

  •   proceeds from public and private financings and, potentially, other strategic transactions;

 

  •   proceeds from the exercise of warrants issued in public and private financings

 

  •   partnering with other pharmaceutical companies to assist in the supply, manufacturing and distribution of our products for which we would expect to receive upfront milestone and royalty payments;

 

  •   potential licensing and joint venture arrangements with third parties, including other pharmaceutical companies where we would receive funding based on out-licensing our product; and

 

  •   seeking government or private foundation grants which would be awarded to us to further develop our current and future anti-cancer therapies.

However, there is a material risk that none of these plans will be implemented and that we will be unable to obtain additional financing on commercially reasonable terms, if at all. If adequate funds are not available, we may be required to significantly reduce or refocus operations or to obtain funds through arrangements that may require us to relinquish rights to technologies or potential markets, any of which could have a material adverse effect on our company, our viability, our financial condition and our results of operations in 2017 and beyond. To the extent that additional capital is raised through the sale of equity or convertible debt securities or exercise of warrants and options, the issuance of such securities would result in ownership dilution to existing stockholders.

 

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

None.

 

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report, the Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer (the “Certifying Officers”), conducted evaluations of our disclosure controls and procedures. As defined under Sections 13a–15(e) and 15d–15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the term “disclosure controls and procedures” means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC. Disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including the Certifying Officers, to allow timely decisions regarding required disclosures.

Based on this evaluation, the Certifying Officers have concluded that our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during our first fiscal quarter of 2017 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Internal Controls

Readers are cautioned that our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud and material error. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our control have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any control design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

Certain information set forth in this Quarterly Report on Form 10-Q, including in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (and the “Liquidity and Capital Resources” section thereof) and elsewhere may address or relate to future events and expectations and as such constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Act of 1995. Such forward-looking statements involve significant risks and uncertainties. Such statements may include, without limitation, statements with respect to our plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects”, “may”, “could”, “would”, “should”, “believes”, “expects”, “anticipates”, “estimates”, “intends”, “plans” or similar expressions. These statements are based upon the current beliefs and expectations of our management and are subject to significant risks and uncertainties, including those detailed in our filings with the SEC. Actual results, including, without limitation: (i) the results of our collaboration with Mayne Pharma, (ii) the application and availability of corporate funds and our need for future funds, or (iii) the timing for completion, and results of, scheduled or additional clinical trials and the FDA’s review and/or approval and potential commercial launch of our products and product candidates and regulatory filings related to the same, may differ significantly from those set forth in the forward-looking statements. Such forward-looking statements also involve other factors which may cause our actual results, performance or achievements to materially differ from any future results, performance, or achievements expressed or implied by such forward-looking statements and to vary significantly from reporting period to reporting period. Such factors include, among others, those listed under Item 1A of our 2016 Annual Report and other factors detailed from time to time in our other filings with the SEC. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual future results will not be different from the expectations expressed in this Report. We undertake no obligation to publically update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

 

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PART II. OTHER INFORMATION

 

Item 1. Legal Proceedings

None.

 

Item 1A. Risk Factors.

Not required for smaller reporting companies.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

 

Item 3. Defaults upon Senior Securities.

None.

 

Item 4. Mine Safety Disclosures.

Not applicable.

 

Item 5. Other Information.

Not applicable.

 

Item 6. Exhibits.

 

Number

  

Description

  31.1    Certification of Chief Executive Officer Pursuant To Sarbanes-Oxley Section 302
  31.2    Certification of Chief Financial Officer Pursuant To Sarbanes-Oxley Section 302
  32.1    Certification Pursuant To 18 U.S.C. Section 1350 (*)
  32.2    Certification Pursuant To 18 U.S.C. Section 1350 (*)
101.ins    XBRL Instance Document
101.sch    XBRL Taxonomy Extension Schema Document
101.cal    XBRL Taxonomy Calculation Linkbase Document
101.def    XBRL Taxonomy Definition Linkbase Document
101.lab    XBRL Taxonomy Label Linkbase Document
101.pre    XBRL Taxonomy Presentation Linkbase Document

 

* A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

12


Table of Contents

SIGNATURES

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

    HEDGEPATH PHARMACEUTICALS, INC.
Date: May 8, 2017     By:  

/s/ Nicholas J. Virca

   

Nicholas J. Virca

President and Chief Executive Officer

(Principal Executive Officer)

Date: May 8, 2017     By:  

/s/ Garrison J. Hasara

   

Garrison J. Hasara, CPA

Chief Financial Officer and Treasurer

(Principal Financial Officer)

 

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