An anonymous director reports

HELIX BIOPHARMA CORP. ANNOUNCES FISCAL 2023 THIRD QUARTER RESULTS

Helix BioPharma Corp. has released financial results for the fiscal 2023 third quarter results for the period ending April 30, 2023.

Overview

The company reported a net loss and total comprehensive loss of $1,337,000 and $4,136,000 for the three- and nine-month periods ended April 30, 2023, respectively (April 30, 2022 -- $1,345,000 and $5,177,000) and a loss of one cent and one cent per common share respectively (April 30, 2022 -- loss of one cent and four cents per common share).

Clinical development

LDOS47 in lung cancer

• The phase I study combination therapy in lung cancer (LDOS001) was completed and a manuscript was accepted for publication in Journal of Thoracic Oncology Clinical and Research Reports on Sept. 2, 2022.
• The phase II study of combination therapy in lung cancer (LDOS003) was halted in the dose escalation portion of the study in 2020 at the height of pandemic lockdown and the final abbreviated clinical trial report has been further delayed amidst war in Ukraine where all subjects were recruited. The company is currently working with study partners to retrieve any data that is salvageable and conclude the study by the end of the third quarter of 2023.
• Another important aspect of the development of the LDOS47 platform is the combination with chemo- and/or immuno-therapy to enhance current therapies, that may boost the utility of the platform. The company continues to have engaged several key opinion leaders to evaluate potential combinations for partnership opportunities.

LDOS47 in pancreatic cancer

The company's phase I-b/II combination trial in pancreatic cancer (LDSOS006) continues to recruit patients, now in the third dosing cohort (nine microg/kilogram), after the successful completion of the second dosing cohort (six microg/kg). A revision to the clinical study protocol was recently submitted to the United States Food and Drug Administration to permit the addition of a further dosing cohort at 13.55 microg/kg. The company remains committed to this study.

Corporate development

• On Nov. 3, 2022, the company announced that it had closed a private placement financing for net proceeds of $4,629,019.86 from the issuance of 25,716,777 common shares at a price of 18 cents per common share. The common shares issued pursuant to the private placement were subject to a statutory hold period of four months and one day ending on March 4, 2023, in accordance with applicable securities law. In connection with the closing, the company paid a cash fee of 10 per cent of gross proceeds raised to an eligible finder.
• On Oct. 3, 2022, the company announced the appointment of Dr. Frank Gary Renshaw, as the chief medical officer.
• On Sept. 1, 2022, the company announced the appointment of Dr. Gabrielle M Siegers, MA, PhD, as the head of RD based out of the company's lab in Edmonton.
• On Aug. 30, 2022, the company announced that it had completed the buyback of the outstanding amount of the convertible security funding agreement with Lind Global Macro Fund LP. The company entered into the agreement with Lind in May, 2021, and closed the first tranche under the agreement for gross proceeds of $3.5-million shortly thereafter. The company has now bought back the amount outstanding of the convertible security under the agreement, which is $2,061,875.
• On Aug. 9, 2022, the company announced that it has entered into a two-year scientific collaboration agreement with University Hospital Tubingen (Germany) to assess the therapeutic response of L-DOS47 in several cancer models expressing CEACAM6, with advanced preclinical metabolic imaging.

Research and development

Research and development expenses for the three and nine-month periods ended April 30, 2023, totalled $1,084,000 and $3,422,000 respectively (April 30, 2022 -- $939,000 and $3,707,000).

The attached table outlines research and development costs expensed for periods as shown therein.

Research and development expenditures for the three-month period ended April 30, 2023, when compared with the period ended April 30, 2022, were higher by $145,000 or 15 per cent. However, the research and development expenditures for the nine-month period ended April 30, 2023, when compared with the period ended April 30, 2022, were lower by $285,000. The decrease in spending is mainly the result of lower expenditures associated with research and development activities by 8 per cent including 64 per cent decrease in stock-based compensation expenses or $$167,000. When compared with the nine-month period ended April 30, 2022, the company spent more on salaries and benefits by 1 per cent.

The company hired biotechnology consultants to assess the company's drug product candidate with a focus on identifying value propositions and positioning strategies that would enable clinical adoption of L-DOS47.

Operating, general and administration

Operating, general and administration expenses for the three and nine-month periods ended April 30, 2023, totalled $272,000 and 764,000 respectively (April 30, 2022 -- totalled $363,000 and 1,218,000).

The attached table outlines operating, general and administration expenses for the periods as shown therein.

Operating, general and administration expenditures for the three- and nine-month periods ended April 30, 2023, when compared with the three- and nine-month periods ended April 30, 2022, were lower by $91,000 and $414,000 respectively or 25 per cent and 37 per cent.

Since May, 2022, the company has made significant efforts to control and reduce its overheads expenditures. This included closing its headquarters at Richmond Hill Ontario and moving it to Grove Corporate Services offices in downtown Toronto. The company hired Grove to perform accounting and corporate secretarial services following the resignation of its previous chief financial officer in May, 2022. The savings apply to various activities including salaries, rent, legal and other operational expenditures. Further measures are being taken which will result in more reductions in the current year.

Several factors materialized that resulted in the company abandoning its plans to list on a United States stock exchange. These include but are not limited to the increase in the percentage ownership of the common shares by new insiders and a decline in the price of the common shares making it extremely challenging for the company to leverage the Multijurisdictional Disclosure System.

Liquidity and capital resources

The company reported a net loss and total comprehensive loss of $1,337,000 and $4,136,000 for the three- and nine-month periods ended April 30, 2023, respectively (April 30, 2022 -- $1,345,000 and $5,177,000) and a loss of one cent and two cents per common share respectively (April 30, 2022 -- loss of one cent and four cents per common share). As at April 30, 2023, the company had working capital of $877,000, shareholders' equity of $913,000 and a deficit of $199,254,000. As at July 31, 2022, the company had working capital of $283,000, shareholders' equity $319,000 and a deficit of $195,117,000.

On Sept. 12, 2022, the company applied to the TSX to price protect a proposed $5-million financing of common shares at a price of 18 cents per share. The TSX granted a price protection letter on Sept. 14, 2022, and the conditional approval of the placement on Sept. 26, 2022. On Nov. 3, 2022, the company announced that it had closed a private placement financing for net proceeds of $4,629,020 from the issuance of 25,716,777 common shares at a price of 18 cents per common share with insiders subscribing for $270,000. The common shares issued pursuant to the private placement are subject to a statutory hold period of four months and one day ending on March 4, 2023, in accordance with applicable securities law. In connection with the closing, the company paid a cash fee of 10 per cent of gross proceeds raised to an eligible finder.

On April 13, 2022, the company announced that it has received conditional approval from the Toronto Stock Exchange to extend its previously announced early warrant exercise incentive program from April 28, 2022, to May 31, 2022. The incentive program is a period during which holders of the company's eligible common share purchase warrants may take advantage of a temporary reduction in the exercise price of the eligible warrants to a price of 26 cents. The eligible warrants include an aggregate of 49,806,469 warrants that if exercised at the incentive exercise price will result in the company receiving gross proceeds of up to $12,949,682. During the three-month period ended Oct. 31, 2022, 12,346,938 warrants were exercised for a total subscription amount of $3,210,204.

On March 11, 2022, the company closed a private placement financing for gross proceeds of $1,001,000 from the issuance of 3.85 million common share at a price of 26 cents per common share. On April 21, 2022, the company closed a private placement financing for net proceeds of $2,002,000 from the issuance of 7.7 million common shares at a price of 26 cents per common share.

In order for the company to advance the currently planned preclinical and clinical research and development activities, its collaborative scientific research programs and pay for its overhead costs, the company will need to raise approximately $11-million through to the end of fiscal 2024. The company projects an average monthly fixed overhead spend of approximately $230,000. This amount does not include the costs related to any of the company's third party activities such as clinical studies, collaborative research activities and contract manufacturing.

The company's statement of financial position and statement of net loss and comprehensive loss for fiscal 2023 and 2022 are summarized herien.

About Helix BioPharma Corp.

Helix BioPharma is a clinical-stage biopharmaceutical company developing unique therapies in the field of immune-oncology for the prevention and treatment of cancer based on the company's proprietary technological platform DOS47. Helix is listed on the Toronto Stock Exchange under the symbol HBP.

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