Sun BioPharma Files Form 10-Q for Third Quarter 2017 and Provides Business Update

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MINNEAPOLIS, Nov. 14, 2017 (GLOBE NEWSWIRE) -- Sun BioPharma, Inc. (OTCQB:SNBP), a clinical stage biopharmaceutical company developing disruptive therapeutics for the treatment of pancreatic diseases, today provides a business update and reports financial results for the third quarter ending September 30, 2017.

To date, the best response outcome and survival have been observed in the group of 13 patients who received total cumulative doses of SBP-101 between 2.5 and 8.0mg/kg. Twelve patients in this group were evaluable for preliminary signs of efficacy at eight weeks. Five (42%) had SD at week eight accompanied by stable or decreased levels of CA19-9. Although enrollment is complete, three patients continued to be followed for survival. As of the most recent updates from study sites, median survival in this group was 3.8 months. Nine patients (69%) have exceeded 3 months of overall survival (“OS”), four patients (31%) had exceeded 4 months of OS, three patients (23%) had exceeded 8 months of OS and two patients (15%) had exceeded 10 months of OS.

“The absence of non-target organ adverse events at the DSMB recommended dose level corroborates our pre-clinical data which suggests non-overlapping toxicity in combination therapy with gemcitabine and nab-paclitaxel,” noted Suzanne Gagnon, MD, Sun BioPharma’s Chief Medical Officer. “We are very encouraged and looking forward to demonstrating the ability of SBP-101, in a combination therapy, to improve outcomes for newly diagnosed PDA patients.”

“Completion of enrollment in our first Phase 1a study with SBP-101, and now just following a few patients for survival data has been a significant milestone for our Company. We also are very excited to be working on designing our next clinical trial. Work is underway at this time to develop the protocol for the next study, determine our clinical study sites, and engage our Principal Investigators for the study. This is a key step in our Company’s progress,” said David Kaysen, President and CEO. “We extend our gratitude to our physician investigators and advisors who have been instrumental in supporting our efforts to develop SBP-101, and of course thank the patients and their families that have been incredibly instrumental in our clinical progress.”

Research and development (“R&D”) expenses decreased 16.7% to $530,000 in the third quarter of 2017, down from $636,000 in the third quarter of 2016. R&D expenses increased 18.0% to $2.0 million for the nine months ended September 30, 2017, up from $1.7 million in the nine months ended September 30, 2016. The current quarter decrease in R&D expense was due primarily to reduced costs of manufacturing and manufacturing process development, which was materially completed in 2016, and fewer study patient enrollments in the third quarter of 2017, partially offset by contract research costs incurred in conjunction with the Company’s NIH sponsored pancreatitis study. The increased costs for the nine months ended September 30, 2017 resulted primarily from the costs of the Phase 1 clinical trial and non-cash share-based compensation expense recorded during the current year. There was no share-based compensation expense recorded during the first nine months of 2016.

Other expense, net, was $371,000 in the current quarter compared to other income, net, of $11,000 in the third quarter of 2017. Other expense, net, increased to $4.5 million for the nine months ended September 30, 2017, up from $70,000 in the same period of the prior year. The increase in the current quarter was primarily due to increased interest expense resulting from the amortization of the discount on the 2017 convertible notes payable, partially offset by grant income earned during the current year received under a research grant awarded to the Company in 2016. On a year-to-date basis, the increase was due primarily to charges recorded related to the induced conversion of debt and increased interest expense resulting from the amortization of the discount on the 2017 convertible notes payable. These expenses were partially offset by foreign currency transaction gains recognized by our Australian subsidiary and grant income earned during the current year period.

Net loss for the three months ended September 30, 2017 was $1.2 million, or $0.33 per diluted share, compared to a net loss of $1.1 million, or $0.34 per diluted share, for the same period in 2016. The net loss for the first nine months of 2017 was $8.2 million, or $2.33 per diluted share, compared to a net loss of $2.9 million, or $0.94 per diluted share, for the first nine months of 2016.

Current liabilities decreased to $2.1 million as of September 30, 2017, compared to $5.5 million as of December 31, 2016. The decrease in current liabilities resulted primarily from the conversion of approximately $3.1 million of previously outstanding debt and accrued interest into 418,332 shares of our common stock and from the reductions in outstanding accounts payable.

Net cash used in operating activities was $2.6 million for the nine months ended September 30, 2017, compared to $1.6 million in the same period of the prior year. The net cash used in each of these periods primarily reflects the net loss for these periods, and was partially offset by the effects of changes in operating assets and liabilities. In the nine months ended September 30, 2017, the net loss is also offset by non-cash charges recorded for the loss on induced debt conversion and share-based compensation.

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Globe Newswire: 13:33 GMT Tuesday 14th November 2017

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