PHIO Phio Pharmaceuticals Corporation

Table of Contents

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

  

FORM 10-Q

  

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

  

For the quarterly period ended June 30, 2023

  

OR

  

☐ 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: 001-36304

  

Phio Pharmaceuticals Corp.

(Exact name of registrant as specified in its charter)

  

Delaware	45-3215903
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

  

257 Simarano Drive, Suite 101, Marlborough, MA 01752

(Address of principal executive office) (Zip code)

  

Registrant’s telephone number, including area code: (508) 767-3861

  

Securities registered pursuant to Section 12(b) of the Act:

  

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value, $0.0001 per share	PHIO	The Nasdaq Capital Market

  

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 every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

  

Large accelerated filer		☐		Accelerated filer		☐
Non-accelerated filer		☒		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 checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

As of August 4, 2023, Phio Pharmaceuticals Corp. had 2,221,856 shares of common stock, $0.0001 par value, outstanding.

 

 

 

 

PHIO PHARMACEUTICALS CORP.

FORM 10-Q — QUARTER ENDED JUNE 30, 2023

 

INDEX

 

Part No.		Item No.		Description		Page No.
I				FINANCIAL INFORMATION		3
		1		Financial Statements (Unaudited)		3
				Condensed Consolidated Balance Sheets as of June 30, 2023 and December 31, 2022		3
				Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2023 and 2022		4
				Condensed Consolidated Statements of Preferred Stock and Stockholders’ Equity for the Three and Six Months Ended June 30, 2023 and 2022		5
				Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2023 and 2022		6
				Notes to Condensed Consolidated Financial Statements		7
		2		Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
		3		Quantitative and Qualitative Disclosures About Market Risk		20
		4		Controls and Procedures		20
II				OTHER INFORMATION		21
		1		Legal Proceedings		21
		1A		Risk Factors		21
		2		Unregistered Sales of Equity Securities and Use of Proceeds		21
		3		Defaults Upon Senior Securities		21
		4		Mine Safety Disclosures		21
		5		Other Information		21
		6		Exhibits		22
Signatures						23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART I — FINANCIAL INFORMATION

 

ITEM 1.

FINANCIAL STATEMENTS

 

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

		June 30, 2023				December 31, 2022
ASSETS
Current assets:
Cash		$	11,307			$	11,781
Restricted cash			50				50
Prepaid expenses and other current assets			678				615
Total current assets			12,035				12,446
Right of use asset			98				161
Property and equipment, net			157				183
Other assets			6				24
Total assets		$	12,296			$	12,814
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	641			$	779
Accrued expenses			1,647				1,025
Lease liability			104				135
Total current liabilities			2,392				1,939
Lease liability, net of current portion			–				35
Total liabilities			2,392				1,974
Commitments and contingencies (Note 2)			–				–
Series D Preferred Stock, $0.0001 par value; 0 and 1 shares authorized, issued and outstanding at June 30, 2023 and December 31, 2022, respectively			–				2
Stockholders’ equity:
Common stock, $0.0001 par value, 100,000,000 shares authorized; 1,985,211 and 1,139,024 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively			–				–
Additional paid-in capital			144,435				139,218
Accumulated deficit			(134,531	)			(128,380	)
Total stockholders’ equity			9,904				10,838
Total liabilities, preferred stock and stockholders’ equity		$	12,296			$	12,814

 

 

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

 

 

 

 

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Operating expenses:
Research and development		$	1,383			$	1,304			$	3,517			$	2,890
General and administrative			1,164				1,217				2,632				2,271
Total operating expenses			2,547				2,521				6,149				5,161
Operating loss			(2,547	)			(2,521	)			(6,149	)			(5,161	)
Total other expense, net			(2	)			(10	)			(2	)			(12	)
Net loss		$	(2,549	)		$	(2,531	)		$	(6,151	)		$	(5,173	)
Net loss per common share:
Basic and diluted		$	(1.47	)		$	(2.22	)		$	(4.28	)		$	(4.56	)
Weighted average number of common shares outstanding
Basic and diluted			1,728,490				1,138,227				1,436,971				1,134,307

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF

PREFERRED STOCK AND STOCKHOLDERS’ EQUITY

(Amounts in thousands, except share data)

(Unaudited)

 

 

		Series D Preferred Stock								Common Stock								Additional Paid-in				Accumulated
For the Three and Six Months Ended June 30, 2023		Shares				Amount				Shares				Amount				Capital				Deficit				Total
Balance at December 31, 2022			1			$	2				1,139,024			$	–			$	139,218			$	(128,380	)		$	10,838
Cash-in-lieu of fractional shares for reverse stock split			–				–				(1,706	)			–				(11	)			–				(11	)
Redemption of preferred stock			(1	)			(2	)			–				–				–				–				–
Issuance of common stock upon vesting of restricted stock units			–				–				18,080				–				–				–				–
Shares withheld for payroll taxes			–				–				(4,816	)			–				(25	)			–				(25	)
Stock-based compensation expense			–				–				–				–				111				–				111
Net loss			–				–				–				–				–				(3,602	)			(3,602	)
Balance at March 31, 2023			–			$	–				1,150,582			$	–			$	139,293			$	(131,982	)		$	7,311
Issuance of common stock and warrants, net of offering costs			–				–				659,629				–				5,048				–				5,048
Issuance of common stock upon exercise of warrants			–				–				175,000				–				–				–				–
Stock-based compensation expense			–				–				–				–				94				–				94
Net loss			–				–				–				–				–				(2,549	)			(2,549	)
Balance at June 30, 2023			–			$	–				1,985,211			$	–			$	144,435			$	(134,531	)		$	9,904

 

 

 

For the Three and Six Months Ended June 30, 2022		Series D Preferred Stock								Common Stock								Additional Paid-in				Accumulated
		Shares				Amount				Shares				Amount				Capital				Deficit				Total
Balance at December 31, 2021			–			$	–				1,127,917			$	–			$	138,832			$	(116,900	)		$	21,932
Issuance of common stock upon vesting of restricted stock units			–				–				12,943				–				–				–				–
Shares withheld for payroll taxes			–				–				(2,633	)			–				(25	)			–				(25	)
Stock-based compensation expense			–				–				–				–				186				–				186
Net loss			–				–				–				–				–				(2,642	)			(2,642	)
Balance at March 31, 2022			–			$	–				1,138,227			$	–			$	138,993			$	(119,542	)		$	19,451
Stock-based compensation expense			–				–				–				–				83				–				83
Net loss			–				–				–				–				–				(2,531	)			(2,531	)
Balance at June 30, 2022			–			$	–				1,138,227			$	–			$	139,076			$	(122,073	)		$	17,003

 

 

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

 

 

 

 

PHIO PHARMACEUTICALS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)
(Unaudited)

 

 

		Six Months Ended June 30,
		2023				2022
Cash flows from operating activities:
Net loss		$	(6,151	)		$	(5,173	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			31				41
Amortization of right of use asset			63				60
Stock-based compensation			205				269
Changes in operating assets and liabilities:
Prepaid expenses and other assets			(45	)			(998	)
Accounts payable			(138	)			865
Accrued expenses			622				(901	)
Lease liability			(66	)			(61	)
Net cash used in operating activities			(5,479	)			(5,898	)
Cash flows from investing activities:
Cash paid for purchase of property and equipment			(5	)			(114	)
Net cash used in investing activities			(5	)			(114	)
Cash flows from financing activities:
Net proceeds from the issuance of common stock and warrants			5,048				–
Cash in lieu of fractional shares for reverse stock split			(11	)			–
Redemption of Series D preferred stock			(2	)			–
Payment of taxes on net share settlements of restricted stock units			(25	)			(25	)
Net cash provided by (used in) financing activities			5,010				(25	)
Net decrease in cash and restricted cash			(474	)			(6,037	)
Cash and restricted cash at the beginning of period			11,831				24,107
Cash and restricted cash at the end of period		$	11,357			$	18,070

 

The following table provides a reconciliation of cash and restricted cash reported within the consolidated balance sheets to the totals above: 

 

		June 30,
		2023				2022
Cash		$	11,307			$	18,020
Restricted cash			50				50
Cash and restricted cash		$	11,357			$	18,070

 

 

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

 

 

 

 

PHIO PHARMACEUTICALS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1. Organization and Significant Accounting Policies

 

Nature of Operations

 

Phio Pharmaceuticals Corp. (“Phio” or the “Company”) is a clinical stage biotechnology company whose proprietary INTASYL™ self-delivering RNAi technology platform is designed to make immune cells more effective in killing tumor cells. Phio is developing therapeutics that are designed to leverage INTASYL to precisely target specific proteins that reduce the body’s ability to fight cancer, without the need for specialized formulations or drug delivery systems.

 

Effective January 26, 2023, the Company completed a 1-for-12 reverse stock split of the Company’s outstanding common stock, including reclassifying an amount equal to the reduction in par value to additional paid-in capital. The reverse stock split did not reduce the number of authorized shares of the Company’s common or preferred stock. All share and per share amounts have been adjusted to give effect to the reverse stock split.

 

Principles of Consolidation

 

The condensed consolidated financial statements include the accounts of Phio and its wholly-owned subsidiary, MirImmune, LLC. All material intercompany accounts have been eliminated in consolidation.

 

Basis of Presentation

 

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures that are included in the Company’s annual consolidated financial statements, but that are not required for interim reporting purposes, have been condensed or omitted. Additionally, the Company made adjustments to the outstanding stock option and unvested restricted stock unit balances, and related per share amounts, at December 31, 2022 to reflect final revisions to these outstanding equity awards as a result of the Company’s reverse stock split. The adjustment had no effect on the Company’s condensed consolidated financial statements. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2023 (the “2022 Form 10-K”). In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation of the condensed consolidated financial statements have been included. Interim results are not necessarily indicative of results for a full year.

 

Use of Estimates

 

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The areas subject to significant estimates and judgement include, among others, those related to the fair value of equity awards, accruals for research and development expenses, useful lives of property and equipment, income taxes, and the valuation allowance on the Company’s deferred tax assets. On an ongoing basis the Company evaluates its estimates and bases its estimates on historical experience and other relevant assumptions that the Company believes are reasonable under the circumstances. Actual results could differ materially from these estimates.

 

 

 

7

 

 

Liquidity

 

The Company has reported recurring losses from operations since inception and expects to continue to have negative cash flows from operations for the foreseeable future. Historically, the Company’s primary source of funding has been from sales of its securities. The Company’s ability to continue to fund its operations is dependent on obtaining funding from third parties, such as proceeds from the issuance of debt, sale of equity, or strategic opportunities, in order to maintain its operations. This is dependent on a number of factors, including the market demand or liquidity of the Company’s common stock. There is no guarantee that debt, additional equity or other funding will be available to the Company on acceptable terms, or at all. If the Company fails to obtain additional funding when needed, the Company would be forced to scale back or terminate its operations or seek to merge with or to be acquired by another company.

 

The Company has limited cash resources, has reported recurring losses from operations since inception and has not yet received product revenues. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern, and the Company’s current cash resources may not provide sufficient capital to fund operations for at least the next 12 months from the date of the release of these financial statements. The continuation of the Company as a going concern depends upon the Company’s ability to raise additional capital through an equity offering, debt offering and/or strategic opportunity to fund its operations. There can be no assurance that the Company will be successful in accomplishing these plans in order to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Summary of Significant Accounting Policies

 

There have been no material changes to the significant accounting policies disclosed in the Company’s 2022 Form 10-K.

 

Recent Accounting Pronouncements

 

There have been no recent accounting pronouncements that have significantly impacted this Quarterly Report on Form 10-Q, beyond those disclosed in the Company’s 2022 Form 10-K.

 

2. Collaboration Agreement

 

AgonOx, Inc. (“AgonOx”)

 

In March 2021, the Company entered into a clinical co-development collaboration agreement (the “Clinical Co-Development Agreement”) with AgonOx, a private company developing a pipeline of novel immunotherapy drugs targeting key regulators of the immune response to cancer. Under the Clinical Co-Development Agreement, Phio and AgonOx are working to develop a T cell-based therapy using the Company’s lead product candidate, PH-762, and AgonOx’s “double positive” tumor infiltrating lymphocytes (“DP TIL”) technology. Per the terms of the Clinical Co-Development Agreement, the Company committed to provide financial support for development costs of up to $4,000,000 to AgonOx for expenses incurred to conduct a Phase 1 clinical trial of PH-762 treated DP TIL in patients with advanced melanoma and other advanced solid tumors.

 

The Company will recognize its share of costs arising from research and development activities performed by AgonOx in the Company’s financial statements in the period AgonOx incurs such expense. Phio will be entitled to certain future development milestones and low single-digit sales-based royalty payments from AgonOx’s licensing of its DP TIL technology.

 

The Company recognized approximately $181,000 and $300,000 of expense in connection with these efforts during the three and six months ended June 30, 2023, respectively. No expense under the Clinical Co-Development Agreement was recognized during the three and six months ended June 30, 2022.

 

There is approximately $3,570,000 of remaining costs not yet incurred under the Clinical Co-Development Agreement as of June 30, 2023.

 

 

 

8

 

 

3. Fair Value of Financial Instruments

 

The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 820, “Fair Value Measurement,” for the Company’s financial assets and liabilities that are re-measured and reported at fair value each reporting period and are re-measured and reported at fair value at least annually using a fair value hierarchy that is broken down into three levels. Level inputs are defined as follows:

 

Level 1 – quoted prices in active markets for identical assets or liabilities.

 

Level 2 – other significant observable inputs for the assets or liabilities through corroboration with market data at the measurement date.

 

Level 3 – significant unobservable inputs that reflect management’s best estimate of what market participants would use to price the assets or liabilities at the measurement date.

 

At June 30, 2023 and December 31, 2022, the Company categorized its restricted cash of $50,000 as Level 2 hierarchy. The assets classified as Level 2 have initially been valued at the applicable transaction price and subsequently valued, at the end of each reporting period, using other market observable data. Observable market data points include quoted prices, interest rates, reportable trades and other industry and economic events.

 

The carrying amounts of cash, accounts payable and accrued expenses of the Company approximate their fair values due to their short-term nature.

 

4. Leases

 

In January 2019, the Company amended the lease for its corporate headquarters and primary research facility in Marlborough, Massachusetts. The lease is for a total of 7,581 square feet of office and laboratory space and will expire on March 31, 2024. The lease contains an option to terminate after two or three years by providing advance written notice of termination pursuant to the terms of the agreement. The exercise of this option was not determined to be reasonably certain and thus was not included in the lease liability on the Company’s balance sheet. The Company did not exercise its option to terminate in either the second or third year of the lease, and the option to terminate has expired. Additionally, the lease agreement did not contain information to determine the borrowing rate implicit in the lease. As such, the Company calculated its incremental borrowing rate based on what the Company would have to pay to borrow on a collateralized basis over the lease term for an amount equal to the remaining lease payments, taking into consideration such assumptions as, but not limited to, the U.S. treasury yield rate and borrowing rates from a creditworthy financial institution using the above lease factors.

 

The lease for the Company’s corporate headquarters represents all of our significant lease obligations. The amounts reported in the condensed consolidated balance sheets for the operating lease in which the Company is the lessee and other supplemental balance sheet information is set forth as follows, in thousands, except the lease term (number of years) and discount rate:

Schedule of lease and supplemental balance sheet information
		June 30, 2023				December 31, 2022
Assets
Right of use asset		$	98			$	161
Liabilities
Lease liability, current			104				135
Lease liability, non-current			–				35
Total lease liability		$	104			$	170
Lease Term and Discount Rate
Weighted average remaining lease term			0.75				1.25
Weighted average discount rate			4.70%				4.70%

 

 

 

9

 

 

Operating lease costs included in operating expense were $33,000 for the three months ended June 30, 2023 and 2022. Operating lease costs included in operating expense were $66,000 for the six months ended June 30, 2023 and 2022.

 

Cash paid for the amounts included in the measurement of the operating lease liability on the Company’s condensed consolidated balance sheets and included within changes in the lease liability in the operating activities of the Company’s condensed consolidated statements of cash flows was $35,000 and $34,000 for the three months ended June 30, 2023 and 2022, respectively. Cash paid for the amounts included in the measurement of the operating lease liability on the Company’s condensed consolidated balance sheets and included within changes in the lease liability in the operating activities of the Company’s condensed consolidated statements of cash flow was $69,000 and $67,000 for the six months ended June 30, 2023 and 2022, respectively.

  

Future lease payments for the Company’s non-cancellable operating lease and a reconciliation to the carrying amount of the operating lease liability presented in the condensed consolidated balance sheet as of June 30, 2023 is as follows, in thousands:

Schedule of future minimum lease payments
2023 (remaining)		$	71
2024			35
Total lease payments			106
Less: Imputed interest			(2	)
Total operating lease liability		$	104

 

 

5. Preferred Stock

 

The Company has authorized up to 10,000,000 shares of preferred stock, $0.0001 par value per share, for issuance. The Company’s Board of Directors (the “Board’) is authorized under the Company’s Amended and Restated Articles of Incorporation (as may be amended and/or restated from time to time, the “Amended Certificate”), to designate the authorized preferred stock into one or more series and to fix and determine such rights, preferences, privileges and restrictions of any series of preferred stock, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, as shall be determined by the Board upon its issuance.

 

On November 16, 2022, the Company issued and sold one share of the Company’s Series D Preferred Stock, par value $0.0001 per share (the “Series D Preferred Stock”) to Robert Bitterman, then its interim Executive Chairman and current Chief Executive Officer, for $1,750. The Series D Preferred Stock was entitled to 17,500,000 votes per share exclusively with respect to any proposal to amend the Company’s Amended Certificate to effect a reverse stock split of the Company’s common stock (“Reverse Stock Split”). The terms of the Series D Preferred Stock provided that it would be voted, without action by the holder, on any such proposal in the same proportion as shares of the Company’s common stock were voted. The Series D Preferred Stock otherwise had no voting rights except as required by the General Corporation Law of the State of Delaware.

 

The Series D Preferred Stock was not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company. The Series D Preferred Stock had no rights with respect to any distribution of assets of the Company, including upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale, dissolution or winding up of the Company, whether voluntarily or involuntarily. The holder of the Series D Preferred Stock was not entitled to receive dividends of any kind.

 

Under its terms, the outstanding share of Series D Preferred Stock was to be redeemed in whole, but not in part, at any time: (i) if such redemption was approved by the Board in its sole discretion or (ii) automatically and effective upon the approval by the Company's stockholders of a Reverse Stock Split. Upon such redemption, the holder of the Series D Preferred Stock was entitled to receive consideration of $1,750 in cash.

 

The Series D Preferred Stock was redeemed in whole on January 4, 2023, upon the approval by the Company’s stockholders of a Reverse Stock Split, such that, at June 30, 2023, there were no shares of Series D Preferred Stock authorized, issued or outstanding and all of the Company’s authorized shares of preferred stock were undesignated.

 

 

 

10

 

 

6. Stockholders’ Equity

 

April 2023 Financing — On April 20, 2023, the Company completed a registered direct offering and a concurrent private placement of a total of: 353,983 registered shares of the Company’s common stock at a purchase price per share of $5.65, unregistered five and one-half year term Series A warrants to purchase up to 353,983 shares of common stock at an exercise price of $5.40 per share and unregistered eighteen month term Series B warrants to purchase up to 353,983 shares of common stock at an exercise price of $5.40 per share (collectively, the “April 2023 Financing”). In addition, the Company issued unregistered warrants to the placement agent, H.C. Wainwright & Co., LLC (“HCW”), in the April 2023 Financing to purchase a total of 26,549 shares of common stock at an exercise price of $7.0625 per share. Net proceeds to the Company from the April 2023 Financing were $1,538,000 after deducting placement agent fees and offering expenses.

 

In connection with the April 2023 Financing, the Company entered into warrant amendment agreements (the “Warrant Amendment Agreements”) with the participating investors to amend the exercise price of certain existing warrants to purchase up to an aggregate of 191,619 shares of common stock that were previously issued in April 2018 through January 2021, such that each of the amended warrants have an exercise price of $5.40 per share. The Company received $24,000 as consideration in connection with the Warrant Amendment Agreements. The Company assessed the amendments to the exercise price of the warrants under ASC Topic 815, “Derivatives and Hedging” (“ASC 815”) and determined that the amendment to the exercise price was completed in connection with and contingent on the close of the April 2023 Financing. The increase in fair value of $293,000 related to the Warrant Amendment Agreements was recognized as an equity issuance cost and recorded in additional paid in capital per ASC 815.

 

June 2023 Financing – On June 2, 2023, the Company completed a registered direct offering and a concurrent private placement of a total of: 233,646 registered shares and 72,000 unregistered shares of the Company’s common stock each at a purchase price per share of $4.28, unregistered pre-funded warrants to purchase up to an aggregate of 628,935 shares of common stock at a purchase price per share of $4.279 and with an exercise price of $0.001 per share, unregistered five and one-half year term Series A warrants to purchase up to an aggregate of 934,581 shares of common stock at an exercise price of $4.03 per share and unregistered eighteen month term Series B warrants to purchase up to an aggregate of 934,581 shares of common stock at an exercise price of $4.03 per share (collectively, the “June 2023 Financing”). In addition, the Company issued unregistered warrants to the placement agent, HCW, in the June 2023 Financing to purchase a total of 70,094 shares of common stock at an exercise price of $5.35 per share. Net proceeds to the Company from the June 2023 Financing were $3,510,000 after deducting placement agent fees and offering expenses.

 

Warrants

 

The Company first assessed the warrants in the April 2023 Financing and June 2023 Financing under the FASB ASC Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”) to determine whether they were within the scope of ASC 480. As there were no instances outside of the Company’s control that could require cash settlement, the Company’s warrants issued in the April 2023 Financing and June 2023 Financing were determined to be outside the scope of ASC 480.

 

The Company then applied and followed the applicable accounting guidance in the FASB ASC Topic 815, “Derivatives and Hedging.” Financial instruments are accounted for as either derivative liabilities or equity instruments depending on the specific terms of the agreement. The warrants issued in the April 2023 Financing and June 2023 Financing did not meet the definition of a derivative instrument as they are indexed to the Company’s common stock and classified within stockholders’ equity. Based on this determination, the warrants issued in the April 2023 Financing and June 2023 Financing were classified within stockholders’ equity.

 

During the six months ended June 30, 2023, shares of common stock issued related to exercises from the pre-funded warrants issued in the June 2023 Financing totaled 175,000. The Company realized proceeds of $175 from the exercises of the pre-funded warrants. There were no warrants exercised during the six months ended June 30, 2022.

 

 

 

11

 

 

The following table summarizes the Company’s outstanding warrants, all of which are classified as equity instruments, at June 30, 2023: 

Summary of outstanding warrants
		Number of Shares				Weighted- Average Exercise Price Per Share
Outstanding at December 31, 2022			545,401			$	54.53
Issued			3,302,706				4.46
Exercised			(175,000	)			0.001
Expired			(1,837	)			1,245.59
Outstanding at June 30, 2023			3,671,270			$	9.09

 

The Company’s outstanding warrants expire at various dates between October 2023 and December 2028.

 

7. Stock-based Compensation

 

Restricted Stock Units

 

Restricted stock units (“RSUs”) are issued under the Company’s 2020 Long-Term Incentive Plan (the “2020 Plan”) or as inducement grants issued outside of the 2020 Plan to new employees. RSUs are generally subject to graded vesting and the satisfaction of certain service requirements. Upon vesting, each outstanding RSU will be settled for one share of the Company’s common stock. Employee RSU recipients may elect to net share settle upon vesting, in which case the Company pays the employee’s income taxes due upon vesting and withholds a number of shares of equal value. The fair value of the RSUs awarded are based upon the Company’s closing stock price at the grant date and are expensed over the requisite service period.

 

The following table summarizes the activity of the Company’s RSUs for the six months ended June 30, 2023: 

Summary of RSU activity
		Number of Shares				Weighted- Average Grant Date Fair Value Per Share
Unvested units at December 31, 2022			47,335			$	15.03
Granted			43,500				5.24
Vested			(18,080	)			16.96
Forfeited			–				–
Unvested units at June 30, 2023			72,755			$	8.70

 

The weighted-average fair value of RSUs granted during the six months ended June 30, 2023 and 2022 was $5.24 and $10.32, respectively. There were no RSU grants during the three months ended June 30, 2023 and 2022.

 

Stock-based compensation expense related to RSUs was $94,000 and $205,000 for the three and six months ended June 30, 2023, respectively. Stock-based compensation expense related to RSUs was $82,000 and $261,000 for the three and six months ended June 30, 2022, respectively.

 

The aggregate fair value of awards that vested during the six months ended June 30, 2023 and 2022 was $95,000 and $128,000, respectively, which represents the market value of the Company’s common stock on the date that the RSUs vested.

 

 

 

12

 

 

Stock Options

 

Stock options are available to be issued under the 2020 Plan and are generally subject to graded vesting and the satisfaction of certain service requirements. Upon the exercise of a stock option, the Company issues new shares and delivers them to the recipient. The Company does not expect to net share settle to satisfy stock option exercises.

 

The Company used the Black-Scholes option-pricing model to determine the fair value of all its option grants. The risk-free interest rate used for each grant was based upon the yield on zero-coupon U.S. Treasury securities with a term similar to the expected life of the related option. The Company’s expected stock price volatility assumption was based upon the Company’s own implied volatility. The expected life assumption used for option grants was based upon the simplified method provided for under ASC 718. The dividend yield assumption was based upon the fact that the Company has never paid cash dividends and presently has no intention of paying cash dividends.

  

The following table summarizes the activity of the Company’s stock options for the six months ended June 30, 2023: 

Summary of Stock Option Activity
		Number of Shares				Weighted- Average Exercise Price Per Share				Aggregate Intrinsic Value
Balance at December 31, 2022			177			$	35,231.40
Granted			–				–
Exercised			–				–
Forfeited			–				–
Expired			(31	)			118,253.58
Balance at June 30, 2023			146			$	17,603.40			$	–
Exercisable at June 30, 2023			146			$	17,603.40			$	–

 

Stock-based compensation expense related to stock options for the three and six months ended June 30, 2022 was $1,000 and $8,000, respectively. As of December 31, 2022, the compensation expense for all unvested stock options had been recognized in the Company’s results of operations.

 

Compensation Expense Related to Equity Awards

 

The following table sets forth total stock-based compensation expense for the three and six months ended June 30, 2023 and 2022, in thousands:

Schedule of stock based compensation expense
		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2023				2022				2023				2022
Research and development		$	49			$	53			$	112			$	109
General and administrative			45				30				93				160
Total stock-based compensation		$	94			$	83			$	205			$	269

 

 

 

13

 

 

8. Net Loss per Common Share

 

Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding. Diluted net loss per share is computed by dividing the Company’s net loss by the weighted average number of common shares outstanding and the impact of the dilutive effect of potential common stock equivalents, except when the inclusion of such potential common stock equivalents would be anti-dilutive. Dilutive potential common stock equivalents primarily consist of stock options, RSUs and warrants. Therefore, basic and diluted net loss per share applicable to common stockholders were the same for all periods presented because the impact of these items is generally anti-dilutive during periods of net loss.

 

The weighted average number of common shares outstanding as of June 30, 2023 includes the pre-funded warrants issued in connection with the June 2023 Financing, the exercise of which requires nominal consideration for the delivery of the shares of common stock.

 

The following table sets forth the potential common shares excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive:

Schedule of anti-dilutive stock
		June 30,
		2023				2022
Stock options			146				175
Unvested restricted stock units			72,755				57,248
Warrants1			3,217,335				545,401
Total			3,290,236				602,824

 

¹ The weighted average number of common shares outstanding as of June 30, 2023 includes the pre-funded warrants issued in the June 2023 Financing because the exercise of such warrants requires only nominal consideration. Therefore, these pre-funded warrants are not included in the table above.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

In this report, “we,” “our,” “ours,” “us,” “Phio” and the “Company” refers to Phio Pharmaceuticals Corp. and our subsidiary, MirImmune, LLC and the ongoing business operations of Phio Pharmaceuticals Corp. and MirImmune, LLC, whether conducted through Phio Pharmaceuticals Corp. or MirImmune, LLC.

 

This management’s discussion and analysis of financial condition as of June 30, 2023 and results of operations for the three and six months ended June 30, 2023 and 2022 should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2023 (the “2022 Form 10-K”).

 

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “intends,” “believes,” “anticipates,” “indicates,” “plans,” “expects,” “suggests,” “may,” “would,” “should,” “potential,” “designed to,” “will,” “ongoing,” “estimate,” “forecast,” “target,” “predict,” “could” and similar references, although not all forward-looking statements contain these words. Forward-looking statements are neither historical facts nor assurances of future performance. These statements are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Risks that could cause actual results to vary from expected results expressed in our forward-looking statements include, but are not limited to, the impact to our business and operations by inflationary pressures, rising interest rates, recession fears, the development of our product candidates, our ability to execute on business strategies, our ability to develop our product candidates with collaboration partners, and the success of any such collaborations, the timeline and duration for advancing our product candidates into clinical development, results from our preclinical and clinical activities, the timing or likelihood of regulatory filings and approvals, the success of our efforts to commercialize our product candidates if approved, our ability to manufacture and supply our product candidates for clinical activities, and for commercial use if approved, the scope of protection we are able to establish and maintain for intellectual property rights covering our technology platform, and our ability to obtain future financing. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements as a result of a number of important factors, including those identified in our 2022 Form 10-K under the heading “Risk Factors” and in other filings the Company periodically makes with the SEC. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements contained in this Quarterly Report on Form 10-Q speak as of the date hereof and the Company does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date of this report except as required by law.

 

Overview

 

Phio is a clinical stage biotechnology company whose proprietary INTASYL™ self-delivering RNAi technology platform is designed to make immune cells more effective in killing tumor cells. We are developing therapeutics that are designed to leverage INTASYL to precisely target specific proteins that reduce the body’s ability to fight cancer, without the need for specialized formulations or drug delivery systems. Our efforts are focused on developing immuno-oncology therapeutics using our INTASYL platform. We have demonstrated preclinical efficacy in both direct-to-tumor injection and adoptive cell therapy (“ACT”) applications with our INTASYL compounds.

 

PH-762

 

PH-762 is an INTASYL compound designed to reduce the expression of cell death protein 1 (“PD-1”). PD-1 is a protein that inhibits T cells’ ability to kill cancer cells and is a clinically validated target in immunotherapy. Decreasing the expression of PD-1 can thereby increase the capacity of T cells, which protect the body from cancer cells and infections, to kill cancer cells.

 

 

 

 

Preclinical studies conducted by the Company have demonstrated that direct-to-tumor application of PH-762 resulted in potent anti-tumoral effects and have shown that direct-to-tumor treatment with PH-762 inhibits tumor growth in a dose dependent fashion in PD-1 responsive and refractory models. Importantly, direct-to-tumor administration of PH-762 resulted in activity against distant untreated tumors, indicative of a systemic anti-tumor response. We believe these data further support the potential for PH-762 to provide a strong local immune response without the dose immune-related adverse effects seen with systemic antibody therapy.

 

In May 2023, we announced that the U.S. Food and Drug Administration (the “FDA”) cleared our Investigational New Drug (“IND”) application to proceed with a U.S. clinical trial of PH-762. The initial multi-center, dose-escalating, Phase 1b clinical trial under our cleared IND is designed to evaluate the safety and tolerability of neoadjuvant use of intratumorally injected PH-762, assess the tumor response, and determine the dose or dose range for continued study of PH-762. We plan to initiate our Phase 1b clinical trial of intratumoral PH-762 in patients with cutaneous squamous cell carcinoma, melanoma and Merkel cell carcinoma in the second half of 2023.

 

We intend to focus our efforts on our U.S. clinical trial with PH-762 and have commenced winding down our first-in-human clinical trial for PH-762 in France, which was limited to the treatment of patients with metastatic melanoma. Safety data from the initial cohort of three patients in the French clinical trial were evaluated by a data monitoring committee in the first quarter of 2023. The safety data review disclosed no dose-limiting toxicity, and no drug-related severe or serious adverse events.

 

Due to INTASYL’s ease of administration, we have shown that our compounds can easily be incorporated into current ACT manufacturing processes. In ACT, T cells are usually taken from a patient's own blood or tumor tissue, grown in large numbers in a laboratory, and then given back to the patient to help the immune system fight cancer. By treating T cells with our INTASYL compounds while they are being grown in the laboratory, we believe our INTASYL compounds can improve these immune cells to make them more effective in killing cancer. Preclinical data generated in collaboration with AgonOx, Inc. (“AgonOx”), a private company developing a pipeline of novel immunotherapy drugs targeting key regulators of the immune response to cancer, demonstrated that treating AgonOx’s “double positive” tumor infiltrating lymphocytes (“DP TIL”) with PH-762 increased their tumor killing activity by two-fold.

 

In March 2021, we entered into a clinical co-development collaboration agreement (the “Clinical Co-Development Agreement”) with AgonOx to develop a T cell-based therapy using PH-762 and AgonOx’s DP TIL. Under the Clinical Co-Development Agreement, we committed to provide financial support for development costs of up to $4 million to AgonOx for expenses incurred to conduct a Phase 1 clinical trial of PH-762 treated DP TIL in patients with advanced melanoma and other advanced solid tumors. Phio is also eligible to receive certain future development milestones and low single-digit sales-based royalty payments from AgonOx’s licensing of its DP TIL technology. As of June 30, 2023, there is approximately $3,570,000 of remaining costs not yet incurred under the Clinical Co-Development Agreement.

 

PH-762 treated DP TIL are being evaluated in a Phase 1 clinical trial in the United States with up to 18 patients with advanced melanoma and other advanced solid tumors by our partner AgonOx. The primary trial objectives are to evaluate the safety and to study the potential for enhanced therapeutic benefit from the administration of PH-762 treated DP TIL. The trial is open for the enrollment of patients.

 

PH-894

 

PH-894 is an INTASYL compound that is designed to silence BRD4, a protein that controls gene expression in both T cells and tumor cells, thereby effecting the immune system as well as the tumor. Intracellular and/or commonly considered “undruggable” targets, such as BRD4, represent a challenge for small molecule and antibody therapies. Therefore, what sets this compound apart is its dual mechanism: PH-894 suppression of BRD4 in T cells results in T cell activation, and suppression of BRD4 in tumor cells results in tumors becoming more sensitive to being killed by T cells.

 

Preclinical studies conducted have demonstrated that PH-894 resulted in a strong, concentration dependent and durable silencing of BRD4 in T cells and in various cancer cells. Similar to PH-762, preclinical studies have also shown that direct-to-tumor application of PH-894 resulted in potent and statistically significant anti-tumoral effects against distant untreated tumors, indicative of a systemic anti-tumor response. These preclinical data indicate that PH-894 can reprogram T cells and other cells in the tumor microenvironment to provide enhanced immunotherapeutic activity. We have completed the IND-enabling studies and are in the process of continuing to finalize the study reports required for an IND submission with PH-894. As a result of the reprioritization to advance our clinical trial with PH-762 in the U.S., we have elected to defer the IND submission for PH-894.

 

 

 

 

Critical Accounting Policies and Estimates

 

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates and base our estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions and could have a material impact on our reported results.

 

There have been no material changes to our critical accounting policies and estimates as compared to those disclosed in our 2022 Form 10-K.

 

Results of Operations

 

The following table summarizes the results of our operations for the periods indicated, in thousands:

 

		Three Months Ended June 30,												Six Months Ended June 30,
Description		2023				2022				Dollar Change				2023				2022				Dollar Change
Operating expenses		$	2,547			$	2,521			$	26			$	6,149			$	5,161			$	988
Operating loss		$	(2,547	)		$	(2,521	)		$	(26	)		$	(6,149	)		$	(5,161	)		$	(988	)
Net loss		$	(2,549	)		$	(2,531	)		$	(18	)		$	(6,151	)		$	(5,173	)		$	(978	)

 

Comparison of the Three and Six Months Ended June 30, 2023 and 2022

 

Operating Expenses

 

The following table summarizes our total operating expenses, for the periods indicated, in thousands:

 

 

		Three Months Ended June 30,												Six Months Ended June 30,
Description		2023				2022				Dollar Change				2023				2022				Dollar Change
Research and development		$	1,383			$	1,304			$	79			$	3,517			$	2,890			$	627
General and administrative			1,164				1,217				(53	)			2,632				2,271				361
Total operating expenses		$	2,547			$	2,521			$	26			$	6,149			$	5,161			$	988

 

 

 

 

Research and Development Expenses

 

Research and development expenses relate to compensation and benefits for research and development personnel, facility-related expenses, supplies, external services, costs to acquire technology licenses, research activities under our research collaboration, expenses associated with preclinical and clinical development activities and other operating costs. Our research and development programs are focused on the development of immuno-oncology therapeutics based on our INTASYL therapeutic platform. Since we commenced operations, research and development expenses have been a significant portion of our total operating expenses and are expected to constitute the majority of our spending for the foreseeable future.

 

Research and development expenses for the three months ended June 30, 2023 increased 6% as compared to the three months ended June 30, 2022. The increase in research and development expenses was primarily due to increased clinical-related costs of approximately $329,000 to support the two PH-762 Phase 1 clinical trials in the U.S., partially offset by decreased costs related to the completion of the Company’s IND-enabling preclinical studies for PH-894 of approximately $207,000 as compared to the prior year period.

 

Research and development expenses for the six months ended June 30, 2023 increased 22% as compared to the six months ended June 30, 2022. The increase in research and development expenses was primarily due to increased clinical-related costs to support the two PH-762 Phase 1 clinical trials in the U.S. of approximately $789,000, partially offset by decreased lab supply costs of $92,000 as a result of a change in headcount as compared to the prior year period.

 

We anticipate research and development expenses to continue to increase as a result of clinical-related activities as our pipeline programs progress in clinical development.

 

General and Administrative Expenses

 

General and administrative expenses relate to compensation and benefits for general and administrative personnel, facility-related expenses, professional fees for legal and patent-related activities, audit, tax and consulting services, as well as other general corporate expenses. 

 

General and administrative expenses for the three months ended June 30, 2023 decreased 4% as compared to the three months ended June 30, 2022. The decrease was primarily due to a total net reduction of approximately $28,000 in payroll-related expenses as a result of the changes in the Company’s Chief Executive Officer (“CEO”) position as compared to the prior year period.

 

General and administrative expenses for the six months ended June 30, 2023 increased 16% as compared to the six months ended June 30, 2022. The increase in general and administrative expenses was primarily due to higher legal fees of approximately $378,000, partially offset by a total net reduction of approximately $52,000 in payroll-related expenses as a result of the changes in the Company’s CEO position as compared to the prior year period.

 

Liquidity and Capital Resources

 

Historically, our primary source of funding has been through the sale of our securities. In the future, we will be dependent on obtaining funding from third parties, such as proceeds from the issuance of debt, sale of equity or strategic opportunities, in order to maintain our operations. We have reported recurring losses from operations since inception and expect that we will continue to have negative cash flows from our operations for the foreseeable future. At June 30, 2023, we had cash of $11,307,000 as compared with $11,781,000 at December 31, 2022.

 

During the quarterly period ended June 30, 2023, we completed the April 2023 Financing and June 2023 Financing (each as defined in Note 6 to our condensed consolidated interim financial statements) and received total net proceeds of $5,048,000 after deducting placement agent fees and offering expenses. For further information regarding the April 2023 Financing and June 2023 Financing, see Note 6 to our condensed consolidated interim financial statements included elsewhere in this Quarterly Report.

 

 

 

 

 

We have limited cash resources, have reported recurring losses from operations since inception and has not yet received product revenues. These factors raise substantial doubt regarding our ability to continue as a going concern, and our current cash resources may not provide sufficient capital to fund operations for at least the next 12 months from the date of the release of the financial statements included elsewhere in this Quarterly Report. Our continuation as a going concern depends upon our ability to raise additional capital through equity offerings, debt offerings and/or strategic opportunities to fund our operations. There can be no assurance that we will be successful in accomplishing any of these plans in order to continue as a going concern. The financial statements included elsewhere in this Quarterly Report do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.

 

The following table summarizes our cash flows for the periods indicated, in thousands:

 

		Six Months Ended June 30,
		2023				2022
Net cash used in operating activities		$	(5,479	)		$	(5,898	)
Net cash used in investing activities			(5	)			(114	)
Net cash provided by (used in) financing activities			5,010				(25	)
Net decrease in cash and restricted cash		$	(474	)		$	(6,037	)

 

Net Cash Flow from Operating Activities

 

Net cash used in operating activities for the six months ended June 30, 2023 decreased by 7% as compared to the six months ended June 30, 2022, primarily due to decreased cash outflow from changes in operating assets and liabilities of $1,468,000 as a result of liabilities owed for the payments related to the IND-enabling studies with PH-894 and clinical supply manufacturing of PH-762 and PH-894 in the prior year period partially offset by an increase in net loss of $978,000.

 

Net Cash Flow from Investing Activities

 

Net cash used in investing activities for the six months ended June 30, 2023 decreased 96% as compared to the six months ended June 30, 2022, primarily due to changes in laboratory and computer equipment purchases for our facility over the period.

 

Net Cash Flow from Financing Activities

 

Net cash provided by financing activities for the six months ended June 30, 2023 increased as compared to the net cash used in financing activities for the six months ended June 30, 2022, primarily due to the completion of the Company’s April 2023 Financing and June 2023 Financing.

  

Contractual Obligations

 

There have been no material changes to the contractual obligations as disclosed in our 2022 Form 10-K. Details of our obligations under the Clinical Co-Development Agreement with our partner AgonOx as of June 30, 2023 can be found in Note 2 of the condensed consolidated interim financial statements included elsewhere in this Quarterly Report.

 

 

 

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a smaller reporting company, we are not required to provide this information.

 

ITEM 4.

CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Our management, with the participation of our Principal Executive Officer (who is also acting as our Principal Financial Officer), evaluated the effectiveness of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report to ensure that information that we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

 

Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. We believe that a control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Based on the evaluation of our disclosure controls and procedures as of the end of the period covered by this report, management, with the participation of our Principal Executive Officer (who is also acting as our Principal Financial Officer), concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of such date.

 

Changes in Internal Control Over Financial Reporting

 

There have been no changes in our internal control over financial reporting that occurred during the quarter ending June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART II — OTHER INFORMATION

 

ITEM 1.

LEGAL PROCEEDINGS

 

From time to time, the Company may become a party to various legal proceedings and complaints arising in the ordinary course of business. We are not currently a party to any actual or threatened material legal proceedings of which we are aware.

 

ITEM 1A.

RISK FACTORS

 

There have been no material changes in our risk factors set forth in Part I, “Item 1A. Risk Factors” in our 2022 Form 10-K. The risk factors disclosed in Part I, “Item 1A. Risk Factors” in our 2022 Form 10-K could materially adversely affect our business, financial condition, or results of operations. This Quarterly Report on Form 10-Q also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including these risks. Additional risks not currently known or currently material to us may also harm our business.

 

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

No sales or issuances of unregistered securities occurred that have not previously been disclosed in a Current Report on Form 8-K.

 

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4.

MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5.

OTHER INFORMATION

 

None.

 

 

 

 

ITEM 6.

EXHIBITS

 

EXHIBIT INDEX

 

		Incorporated by Reference Herein
Exhibit Number	Description	Form		Date
3.1	Amended and Restated Certificate of Incorporation of Phio Pharmaceuticals Corp.	Current Report on Form 8-K (File No. 001-36304)		November 19, 2018
3.2	Certificate of Amendment to the Amendment and Restated Certificate of Incorporation of Phio Pharmaceuticals Corp.	Current Report on Form 8-K (File No. 001-36304)		January 14, 2020
3.3	Certificate of Amendment to the Amendment and Restated Certificate of Incorporation of Phio Pharmaceuticals Corp.	Current Report on Form 8-K (File No. 001-36304)		January 25, 2023
3.4	Certificate of Designation of Series D Preferred Stock, dated November 16, 2022.	Current Report on Form 8-K (File No. 001-36304)		November 16, 2022
4.1	Form of Series A Common Stock Warrant, dated April 20, 2023.	Current Report on Form 8-K (File No. 001-36304)		April 20, 2023
4.2	Form of Series B Common Stock Warrant, dated April 20, 2023.	Current Report on Form 8-K (File No. 001-36304)		April 20, 2023
4.3	Form of Existing Warrant Amendment, dated April 28, 2023.	Current Report on Form 8-K (File No. 001-36304)		April 20, 2023
4.4	Form of Series A Common Stock Warrant, dated June 2, 2023.	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
4.5	Form of Series B Common Stock Warrant, dated June 2, 2023.	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
4.6	Form of Pre-funded Common Stock Warrant, dated June 2, 2023.	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
10.1	Form of Securities Purchase Agreement, dated April 18, 2023, by and between the Company and each of the Purchasers signatory thereto.	Current Report on Form 8-K (File No. 001-36304)		April 20, 2023
10.2	Form of Securities Purchase Agreement, dated May 31, 2023, by and between the Company and each of the Purchasers signatory thereto (Registered Direct Offering).	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
10.3	Form of Securities Purchase Agreement, dated May 31, 2023, by and between the Company and each of the Purchasers signatory thereto (PIPE Private Placement).	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
10.4	Form of Registration Rights Agreement, dated May 31, 2023, by and between the Company and each of the Purchasers signatory thereto.	Current Report on Form 8-K (File No. 001-36304)		June 2, 2023
31.1	Sarbanes-Oxley Act Section 302 Certification of Principal Executive Officer and Principal Financial Officer. *
32.1	Sarbanes-Oxley Act Section 906 Certification of Principal Executive Officer and Principal Financial Officer. **
101.INS	Inline XBRL Instance Document.*
101.SCH	Inline XBRL Taxonomy Extension Schema Document.*
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.*
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.*
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.*
104	The cover page for this report, formatted in Inline XBRL (included in Exhibit 101).*

 

	*	Filed herewith.
	**	Furnished herewith and not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section or incorporated by reference into any filing under the Securities Act or the Exchange Act.

 

 

 

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	Phio Pharmaceuticals Corp.
	By:		/s/ Robert J. Bitterman
			Robert J. Bitterman
			President and Chief Executive Officer (as Principal Executive and Financial Officer)
			Date: August 10, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER

PURSUANT TO

SECURITIES EXCHANGE ACT OF 1934 RULES 13a-14(a) AND 15d-14(a)

AS ADOPTED

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Robert J. Bitterman, certify that:

 

1.

I have reviewed this Quarterly Report on Form 10-Q of Phio Pharmaceuticals Corp.;

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.

I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

 

a.

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

 

b.

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c.

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d.

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a.

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b.

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

 

Dated: August 10, 2023

/s/ Robert J. Bitterman
Robert J. Bitterman
President and Chief Executive Officer
(as Principal Executive and Financial Officer)

 

 

Exhibit 32.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Phio Pharmaceuticals Corp. (the “Company”) on Form 10-Q for the period ended June 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned officer of the Company certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to their knowledge:

 

1.

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2.

The information contained in the Report fairly presents, in all material respects, the Company’s financial condition and result of operations.

 

 

Dated: August 10, 2023

 

/s/ Robert J. Bitterman
Robert J. Bitterman
President and Chief Executive Officer
(as Principal Executive and Financial Officer)

 

v3.23.2

Cover - shares	6 Months Ended
	Jun. 30, 2023	Aug. 04, 2023
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	001-36304
Entity Registrant Name	Phio Pharmaceuticals Corp.
Entity Central Index Key	0001533040
Entity Tax Identification Number	45-3215903
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	257 Simarano Drive
Entity Address, Address Line Two	Suite 101
Entity Address, City or Town	Marlborough
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	01752
City Area Code	(508)
Local Phone Number	767-3861
Title of 12(b) Security	Common Stock, par value, $0.0001 per share
Trading Symbol	PHIO
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		2,221,856

v3.23.2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash	$ 11,307	$ 11,781
Restricted cash	50	50
Prepaid expenses and other current assets	678	615
Total current assets	12,035	12,446
Right of use asset	98	161
Property and equipment, net	157	183
Other assets	6	24
Total assets	12,296	12,814
Current liabilities:
Accounts payable	641	779
Accrued expenses	1,647	1,025
Lease liability	104	135
Total current liabilities	2,392	1,939
Lease liability, net of current portion	0	35
Total liabilities	2,392	1,974
Commitments and contingencies (Note 2)
Series D Preferred Stock, $0.0001 par value; 0 and 1 shares authorized, issued and outstanding at June 30, 2023 and December 31, 2022, respectively	0	2
Stockholders’ equity:
Common stock, $0.0001 par value, 100,000,000 shares authorized; 1,985,211 and 1,139,024 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively	0	0
Additional paid-in capital	144,435	139,218
Accumulated deficit	(134,531)	(128,380)
Total stockholders’ equity	9,904	10,838
Total liabilities, preferred stock and stockholders’ equity	$ 12,296	$ 12,814

v3.23.2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Temporary Equity, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Temporary Equity, Shares Authorized	0	1
Temporary Equity, Shares Issued	0	1
Temporary Equity, Shares Outstanding	0	1
Common Stock, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	100,000,000	100,000,000
Common Stock, Shares, Issued	1,985,211	1,139,024
Common Stock, Shares, Outstanding	1,985,211	1,139,024

v3.23.2

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Operating expenses:
Research and development	$ 1,383	$ 1,304	$ 3,517	$ 2,890
General and administrative	1,164	1,217	2,632	2,271
Total operating expenses	2,547	2,521	6,149	5,161
Operating loss	(2,547)	(2,521)	(6,149)	(5,161)
Total other expense, net	(2)	(10)	(2)	(12)
Net loss	$ (2,549)	$ (2,531)	$ (6,151)	$ (5,173)

v3.23.2

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - $ / shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Statement [Abstract]
Earnings Per Share, Basic	$ (1.47)	$ (2.22)	$ (4.28)	$ (4.56)
Earnings Per Share, Diluted	$ (1.47)	$ (2.22)	$ (4.28)	$ (4.56)
Weighted Average Number of Shares Outstanding, Basic	1,728,490	1,138,227	1,436,971	1,134,307
Weighted Average Number of Shares Outstanding, Diluted	1,728,490	1,138,227	1,436,971	1,134,307

v3.23.2

CONDENSED CONSOLIDATED STATEMENTS OF PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Preferred Stock Series D [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Beginning balance, value at Dec. 31, 2021	$ 0	$ 0	$ 138,832	$ (116,900)	$ 21,932
Balance at ending, shares at Dec. 31, 2021	0	1,127,917
Issuance of common stock upon vesting of restricted stock units
Issuance of common stock upon vesting of restricted stock units, shares		12,943
Shares withheld for payroll taxes			(25)		(25)
Shares withheld for payroll taxes, shares		(2,633)
Stock-based compensation expense			186		186
Net loss				(2,642)	(2,642)
Ending balance, value at Mar. 31, 2022	$ 0	$ 0	138,993	(119,542)	19,451
Balance at ending, shares at Mar. 31, 2022	0	1,138,227
Beginning balance, value at Dec. 31, 2021	$ 0	$ 0	138,832	(116,900)	21,932
Balance at ending, shares at Dec. 31, 2021	0	1,127,917
Net loss					(5,173)
Ending balance, value at Jun. 30, 2022	$ 0	$ 0	139,076	(122,073)	17,003
Balance at ending, shares at Jun. 30, 2022	0	1,138,227
Beginning balance, value at Mar. 31, 2022	$ 0	$ 0	138,993	(119,542)	19,451
Balance at ending, shares at Mar. 31, 2022	0	1,138,227
Stock-based compensation expense			83		83
Net loss				(2,531)	(2,531)
Ending balance, value at Jun. 30, 2022	$ 0	$ 0	139,076	(122,073)	17,003
Balance at ending, shares at Jun. 30, 2022	0	1,138,227
Beginning balance, value at Dec. 31, 2022	$ 2	$ 0	139,218	(128,380)	10,838
Balance at ending, shares at Dec. 31, 2022	1	1,139,024
Cash-in-lieu of fractional shares for reverse stock split			(11)		(11)
Cash-in-lieu of fractional shares for reverse stock split, shares		(1,706)
Redemption of preferred stock	$ (2)	$ 0	0	0	0
Redemption of preferred stock, shares	(1)
Issuance of common stock upon vesting of restricted stock units	$ 0	$ 0	0	0	0
Issuance of common stock upon vesting of restricted stock units, shares		18,080
Shares withheld for payroll taxes			(25)		(25)
Shares withheld for payroll taxes, shares		(4,816)
Stock-based compensation expense			111		111
Net loss				(3,602)	(3,602)
Ending balance, value at Mar. 31, 2023	$ 0	$ 0	139,293	(131,982)	7,311
Balance at ending, shares at Mar. 31, 2023	0	1,150,582
Beginning balance, value at Dec. 31, 2022	$ 2	$ 0	139,218	(128,380)	10,838
Balance at ending, shares at Dec. 31, 2022	1	1,139,024
Net loss					(6,151)
Ending balance, value at Jun. 30, 2023	$ 0	$ 0	144,435	(134,531)	9,904
Balance at ending, shares at Jun. 30, 2023	0	1,985,211
Beginning balance, value at Mar. 31, 2023	$ 0	$ 0	139,293	(131,982)	7,311
Balance at ending, shares at Mar. 31, 2023	0	1,150,582
Stock-based compensation expense			94		94
Net loss				(2,549)	(2,549)
Issuance of common stock and warrants, net of offering costs			5,048		5,048
Issuance of common stock and warrants, shares		659,629
Issuance of common stock upon exercise of warrants	0	$ 0	0	0	0
Issuance of common stock upon exercise of warrants, shares		175,000
Ending balance, value at Jun. 30, 2023	$ 0	$ 0	$ 144,435	$ (134,531)	$ 9,904
Balance at ending, shares at Jun. 30, 2023	0	1,985,211

v3.23.2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash flows from operating activities:
Net loss	$ (6,151)	$ (5,173)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	31	41
Amortization of right of use asset	63	60
Stock-based compensation	205	269
Changes in operating assets and liabilities:
Prepaid expenses and other assets	(45)	(998)
Accounts payable	(138)	865
Accrued expenses	622	(901)
Lease liability	(66)	(61)
Net cash used in operating activities	(5,479)	(5,898)
Cash flows from investing activities:
Cash paid for purchase of property and equipment	(5)	(114)
Net cash used in investing activities	(5)	(114)
Cash flows from financing activities:
Net proceeds from the issuance of common stock and warrants	5,048	0
Cash in lieu of fractional shares for reverse stock split	(11)	0
Redemption of Series D preferred stock	(2)	0
Payment of taxes on net share settlements of restricted stock units	(25)	(25)
Net cash provided by (used in) financing activities	5,010	(25)
Net decrease in cash and restricted cash	(474)	(6,037)
Cash and restricted cash at the beginning of period	11,831	24,107
Cash and restricted cash at the end of period	$ 11,357	$ 18,070

v3.23.2

Reconciliation of Cash - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Cash	$ 11,307	$ 11,781	$ 18,020
Restricted cash	50	50	50
Cash and restricted cash	$ 11,357	$ 11,831	$ 18,070	$ 24,107

v3.23.2

Organization and Significant Accounting Policies	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Significant Accounting Policies	1. Organization and Significant Accounting Policies   Nature of Operations   Phio Pharmaceuticals Corp. (“Phio” or the “Company”) is a clinical stage biotechnology company whose proprietary INTASYL™ self-delivering RNAi technology platform is designed to make immune cells more effective in killing tumor cells. Phio is developing therapeutics that are designed to leverage INTASYL to precisely target specific proteins that reduce the body’s ability to fight cancer, without the need for specialized formulations or drug delivery systems.   Effective January 26, 2023, the Company completed a 1-for-12 reverse stock split of the Company’s outstanding common stock, including reclassifying an amount equal to the reduction in par value to additional paid-in capital. The reverse stock split did not reduce the number of authorized shares of the Company’s common or preferred stock. All share and per share amounts have been adjusted to give effect to the reverse stock split.   Principles of Consolidation   The condensed consolidated financial statements include the accounts of Phio and its wholly-owned subsidiary, MirImmune, LLC. All material intercompany accounts have been eliminated in consolidation.   Basis of Presentation   The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures that are included in the Company’s annual consolidated financial statements, but that are not required for interim reporting purposes, have been condensed or omitted. Additionally, the Company made adjustments to the outstanding stock option and unvested restricted stock unit balances, and related per share amounts, at December 31, 2022 to reflect final revisions to these outstanding equity awards as a result of the Company’s reverse stock split. The adjustment had no effect on the Company’s condensed consolidated financial statements. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2023 (the “2022 Form 10-K”). In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation of the condensed consolidated financial statements have been included. Interim results are not necessarily indicative of results for a full year.   Use of Estimates   The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The areas subject to significant estimates and judgement include, among others, those related to the fair value of equity awards, accruals for research and development expenses, useful lives of property and equipment, income taxes, and the valuation allowance on the Company’s deferred tax assets. On an ongoing basis the Company evaluates its estimates and bases its estimates on historical experience and other relevant assumptions that the Company believes are reasonable under the circumstances. Actual results could differ materially from these estimates.   Liquidity   The Company has reported recurring losses from operations since inception and expects to continue to have negative cash flows from operations for the foreseeable future. Historically, the Company’s primary source of funding has been from sales of its securities. The Company’s ability to continue to fund its operations is dependent on obtaining funding from third parties, such as proceeds from the issuance of debt, sale of equity, or strategic opportunities, in order to maintain its operations. This is dependent on a number of factors, including the market demand or liquidity of the Company’s common stock. There is no guarantee that debt, additional equity or other funding will be available to the Company on acceptable terms, or at all. If the Company fails to obtain additional funding when needed, the Company would be forced to scale back or terminate its operations or seek to merge with or to be acquired by another company.   The Company has limited cash resources, has reported recurring losses from operations since inception and has not yet received product revenues. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern, and the Company’s current cash resources may not provide sufficient capital to fund operations for at least the next 12 months from the date of the release of these financial statements. The continuation of the Company as a going concern depends upon the Company’s ability to raise additional capital through an equity offering, debt offering and/or strategic opportunity to fund its operations. There can be no assurance that the Company will be successful in accomplishing these plans in order to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.   Summary of Significant Accounting Policies   There have been no material changes to the significant accounting policies disclosed in the Company’s 2022 Form 10-K.   Recent Accounting Pronouncements   There have been no recent accounting pronouncements that have significantly impacted this Quarterly Report on Form 10-Q, beyond those disclosed in the Company’s 2022 Form 10-K.

v3.23.2

Collaboration Agreement	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Collaboration Agreement	2. Collaboration Agreement   AgonOx, Inc. (“AgonOx”)   In March 2021, the Company entered into a clinical co-development collaboration agreement (the “Clinical Co-Development Agreement”) with AgonOx, a private company developing a pipeline of novel immunotherapy drugs targeting key regulators of the immune response to cancer. Under the Clinical Co-Development Agreement, Phio and AgonOx are working to develop a T cell-based therapy using the Company’s lead product candidate, PH-762, and AgonOx’s “double positive” tumor infiltrating lymphocytes (“DP TIL”) technology. Per the terms of the Clinical Co-Development Agreement, the Company committed to provide financial support for development costs of up to $4,000,000 to AgonOx for expenses incurred to conduct a Phase 1 clinical trial of PH-762 treated DP TIL in patients with advanced melanoma and other advanced solid tumors.   The Company will recognize its share of costs arising from research and development activities performed by AgonOx in the Company’s financial statements in the period AgonOx incurs such expense. Phio will be entitled to certain future development milestones and low single-digit sales-based royalty payments from AgonOx’s licensing of its DP TIL technology.   The Company recognized approximately $181,000 and $300,000 of expense in connection with these efforts during the three and six months ended June 30, 2023, respectively. No expense under the Clinical Co-Development Agreement was recognized during the three and six months ended June 30, 2022.   There is approximately $3,570,000 of remaining costs not yet incurred under the Clinical Co-Development Agreement as of June 30, 2023.

v3.23.2

Fair Value of Financial Instruments	6 Months Ended
	Jun. 30, 2023
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	3. Fair Value of Financial Instruments   The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 820, “Fair Value Measurement,” for the Company’s financial assets and liabilities that are re-measured and reported at fair value each reporting period and are re-measured and reported at fair value at least annually using a fair value hierarchy that is broken down into three levels. Level inputs are defined as follows:   Level 1 – quoted prices in active markets for identical assets or liabilities.   Level 2 – other significant observable inputs for the assets or liabilities through corroboration with market data at the measurement date.   Level 3 – significant unobservable inputs that reflect management’s best estimate of what market participants would use to price the assets or liabilities at the measurement date.   At June 30, 2023 and December 31, 2022, the Company categorized its restricted cash of $50,000 as Level 2 hierarchy. The assets classified as Level 2 have initially been valued at the applicable transaction price and subsequently valued, at the end of each reporting period, using other market observable data. Observable market data points include quoted prices, interest rates, reportable trades and other industry and economic events.   The carrying amounts of cash, accounts payable and accrued expenses of the Company approximate their fair values due to their short-term nature.

v3.23.2

Leases	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
Leases	4. Leases   In January 2019, the Company amended the lease for its corporate headquarters and primary research facility in Marlborough, Massachusetts. The lease is for a total of 7,581 square feet of office and laboratory space and will expire on March 31, 2024. The lease contains an option to terminate after two or three years by providing advance written notice of termination pursuant to the terms of the agreement. The exercise of this option was not determined to be reasonably certain and thus was not included in the lease liability on the Company’s balance sheet. The Company did not exercise its option to terminate in either the second or third year of the lease, and the option to terminate has expired. Additionally, the lease agreement did not contain information to determine the borrowing rate implicit in the lease. As such, the Company calculated its incremental borrowing rate based on what the Company would have to pay to borrow on a collateralized basis over the lease term for an amount equal to the remaining lease payments, taking into consideration such assumptions as, but not limited to, the U.S. treasury yield rate and borrowing rates from a creditworthy financial institution using the above lease factors.   The lease for the Company’s corporate headquarters represents all of our significant lease obligations. The amounts reported in the condensed consolidated balance sheets for the operating lease in which the Company is the lessee and other supplemental balance sheet information is set forth as follows, in thousands, except the lease term (number of years) and discount rate: Schedule of lease and supplemental balance sheet information                 June 30, 2023     December 31, 2022   Assets                 Right of use asset   $ 98     $ 161   Liabilities                 Lease liability, current     104       135   Lease liability, non-current     –       35   Total lease liability   $ 104     $ 170   Lease Term and Discount Rate                 Weighted average remaining lease term     0.75       1.25   Weighted average discount rate     4.70%       4.70%     Operating lease costs included in operating expense were $33,000 for the three months ended June 30, 2023 and 2022. Operating lease costs included in operating expense were $66,000 for the six months ended June 30, 2023 and 2022.   Cash paid for the amounts included in the measurement of the operating lease liability on the Company’s condensed consolidated balance sheets and included within changes in the lease liability in the operating activities of the Company’s condensed consolidated statements of cash flows was $35,000 and $34,000 for the three months ended June 30, 2023 and 2022, respectively. Cash paid for the amounts included in the measurement of the operating lease liability on the Company’s condensed consolidated balance sheets and included within changes in the lease liability in the operating activities of the Company’s condensed consolidated statements of cash flow was $69,000 and $67,000 for the six months ended June 30, 2023 and 2022, respectively.    Future lease payments for the Company’s non-cancellable operating lease and a reconciliation to the carrying amount of the operating lease liability presented in the condensed consolidated balance sheet as of June 30, 2023 is as follows, in thousands: Schedule of future minimum lease payments       2023 (remaining)   $ 71   2024     35   Total lease payments     106   Less: Imputed interest     (2 ) Total operating lease liability   $ 104

v3.23.2

Preferred Stock	6 Months Ended
	Jun. 30, 2023
Temporary Equity Disclosure [Abstract]
Preferred Stock	5. Preferred Stock   The Company has authorized up to 10,000,000 shares of preferred stock, $0.0001 par value per share, for issuance. The Company’s Board of Directors (the “Board’) is authorized under the Company’s Amended and Restated Articles of Incorporation (as may be amended and/or restated from time to time, the “Amended Certificate”), to designate the authorized preferred stock into one or more series and to fix and determine such rights, preferences, privileges and restrictions of any series of preferred stock, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, as shall be determined by the Board upon its issuance.   On November 16, 2022, the Company issued and sold one share of the Company’s Series D Preferred Stock, par value $0.0001 per share (the “Series D Preferred Stock”) to Robert Bitterman, then its interim Executive Chairman and current Chief Executive Officer, for $1,750. The Series D Preferred Stock was entitled to 17,500,000 votes per share exclusively with respect to any proposal to amend the Company’s Amended Certificate to effect a reverse stock split of the Company’s common stock (“Reverse Stock Split”). The terms of the Series D Preferred Stock provided that it would be voted, without action by the holder, on any such proposal in the same proportion as shares of the Company’s common stock were voted. The Series D Preferred Stock otherwise had no voting rights except as required by the General Corporation Law of the State of Delaware.   The Series D Preferred Stock was not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company. The Series D Preferred Stock had no rights with respect to any distribution of assets of the Company, including upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale, dissolution or winding up of the Company, whether voluntarily or involuntarily. The holder of the Series D Preferred Stock was not entitled to receive dividends of any kind.   Under its terms, the outstanding share of Series D Preferred Stock was to be redeemed in whole, but not in part, at any time: (i) if such redemption was approved by the Board in its sole discretion or (ii) automatically and effective upon the approval by the Company's stockholders of a Reverse Stock Split. Upon such redemption, the holder of the Series D Preferred Stock was entitled to receive consideration of $1,750 in cash.   The Series D Preferred Stock was redeemed in whole on January 4, 2023, upon the approval by the Company’s stockholders of a Reverse Stock Split, such that, at June 30, 2023, there were no shares of Series D Preferred Stock authorized, issued or outstanding and all of the Company’s authorized shares of preferred stock were undesignated.

v3.23.2

Stockholders’ Equity	6 Months Ended
	Jun. 30, 2023
Equity [Abstract]
Stockholders’ Equity	6. Stockholders’ Equity   April 2023 Financing — On April 20, 2023, the Company completed a registered direct offering and a concurrent private placement of a total of: 353,983 registered shares of the Company’s common stock at a purchase price per share of $5.65, unregistered five and one-half year term Series A warrants to purchase up to 353,983 shares of common stock at an exercise price of $5.40 per share and unregistered eighteen month term Series B warrants to purchase up to 353,983 shares of common stock at an exercise price of $5.40 per share (collectively, the “April 2023 Financing”). In addition, the Company issued unregistered warrants to the placement agent, H.C. Wainwright & Co., LLC (“HCW”), in the April 2023 Financing to purchase a total of 26,549 shares of common stock at an exercise price of $7.0625 per share. Net proceeds to the Company from the April 2023 Financing were $1,538,000 after deducting placement agent fees and offering expenses.   In connection with the April 2023 Financing, the Company entered into warrant amendment agreements (the “Warrant Amendment Agreements”) with the participating investors to amend the exercise price of certain existing warrants to purchase up to an aggregate of 191,619 shares of common stock that were previously issued in April 2018 through January 2021, such that each of the amended warrants have an exercise price of $5.40 per share. The Company received $24,000 as consideration in connection with the Warrant Amendment Agreements. The Company assessed the amendments to the exercise price of the warrants under ASC Topic 815, “Derivatives and Hedging” (“ASC 815”) and determined that the amendment to the exercise price was completed in connection with and contingent on the close of the April 2023 Financing. The increase in fair value of $293,000 related to the Warrant Amendment Agreements was recognized as an equity issuance cost and recorded in additional paid in capital per ASC 815.   June 2023 Financing – On June 2, 2023, the Company completed a registered direct offering and a concurrent private placement of a total of: 233,646 registered shares and 72,000 unregistered shares of the Company’s common stock each at a purchase price per share of $4.28, unregistered pre-funded warrants to purchase up to an aggregate of 628,935 shares of common stock at a purchase price per share of $4.279 and with an exercise price of $0.001 per share, unregistered five and one-half year term Series A warrants to purchase up to an aggregate of 934,581 shares of common stock at an exercise price of $4.03 per share and unregistered eighteen month term Series B warrants to purchase up to an aggregate of 934,581 shares of common stock at an exercise price of $4.03 per share (collectively, the “June 2023 Financing”). In addition, the Company issued unregistered warrants to the placement agent, HCW, in the June 2023 Financing to purchase a total of 70,094 shares of common stock at an exercise price of $5.35 per share. Net proceeds to the Company from the June 2023 Financing were $3,510,000 after deducting placement agent fees and offering expenses.   Warrants   The Company first assessed the warrants in the April 2023 Financing and June 2023 Financing under the FASB ASC Topic 480, “Distinguishing Liabilities from Equity” (“ASC 480”) to determine whether they were within the scope of ASC 480. As there were no instances outside of the Company’s control that could require cash settlement, the Company’s warrants issued in the April 2023 Financing and June 2023 Financing were determined to be outside the scope of ASC 480.   The Company then applied and followed the applicable accounting guidance in the FASB ASC Topic 815, “Derivatives and Hedging.” Financial instruments are accounted for as either derivative liabilities or equity instruments depending on the specific terms of the agreement. The warrants issued in the April 2023 Financing and June 2023 Financing did not meet the definition of a derivative instrument as they are indexed to the Company’s common stock and classified within stockholders’ equity. Based on this determination, the warrants issued in the April 2023 Financing and June 2023 Financing were classified within stockholders’ equity.   During the six months ended June 30, 2023, shares of common stock issued related to exercises from the pre-funded warrants issued in the June 2023 Financing totaled 175,000. The Company realized proceeds of $175 from the exercises of the pre-funded warrants. There were no warrants exercised during the six months ended June 30, 2022.   The following table summarizes the Company’s outstanding warrants, all of which are classified as equity instruments, at June 30, 2023:  Summary of outstanding warrants                 Number of Shares     Weighted- Average Exercise Price Per Share   Outstanding at December 31, 2022     545,401     $ 54.53   Issued     3,302,706       4.46   Exercised     (175,000 )     0.001   Expired     (1,837 )     1,245.59   Outstanding at June 30, 2023     3,671,270     $ 9.09     The Company’s outstanding warrants expire at various dates between October 2023 and December 2028.

v3.23.2

Stock-based Compensation	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Stock-based Compensation	7. Stock-based Compensation   Restricted Stock Units   Restricted stock units (“RSUs”) are issued under the Company’s 2020 Long-Term Incentive Plan (the “2020 Plan”) or as inducement grants issued outside of the 2020 Plan to new employees. RSUs are generally subject to graded vesting and the satisfaction of certain service requirements. Upon vesting, each outstanding RSU will be settled for one share of the Company’s common stock. Employee RSU recipients may elect to net share settle upon vesting, in which case the Company pays the employee’s income taxes due upon vesting and withholds a number of shares of equal value. The fair value of the RSUs awarded are based upon the Company’s closing stock price at the grant date and are expensed over the requisite service period.   The following table summarizes the activity of the Company’s RSUs for the six months ended June 30, 2023:  Summary of RSU activity                 Number of Shares     Weighted- Average Grant Date Fair Value Per Share   Unvested units at December 31, 2022     47,335     $ 15.03   Granted     43,500       5.24   Vested     (18,080 )     16.96   Forfeited     –       –   Unvested units at June 30, 2023     72,755     $ 8.70     The weighted-average fair value of RSUs granted during the six months ended June 30, 2023 and 2022 was $5.24 and $10.32, respectively. There were no RSU grants during the three months ended June 30, 2023 and 2022.   Stock-based compensation expense related to RSUs was $94,000 and $205,000 for the three and six months ended June 30, 2023, respectively. Stock-based compensation expense related to RSUs was $82,000 and $261,000 for the three and six months ended June 30, 2022, respectively.   The aggregate fair value of awards that vested during the six months ended June 30, 2023 and 2022 was $95,000 and $128,000, respectively, which represents the market value of the Company’s common stock on the date that the RSUs vested.   Stock Options   Stock options are available to be issued under the 2020 Plan and are generally subject to graded vesting and the satisfaction of certain service requirements. Upon the exercise of a stock option, the Company issues new shares and delivers them to the recipient. The Company does not expect to net share settle to satisfy stock option exercises.   The Company used the Black-Scholes option-pricing model to determine the fair value of all its option grants. The risk-free interest rate used for each grant was based upon the yield on zero-coupon U.S. Treasury securities with a term similar to the expected life of the related option. The Company’s expected stock price volatility assumption was based upon the Company’s own implied volatility. The expected life assumption used for option grants was based upon the simplified method provided for under ASC 718. The dividend yield assumption was based upon the fact that the Company has never paid cash dividends and presently has no intention of paying cash dividends.    The following table summarizes the activity of the Company’s stock options for the six months ended June 30, 2023:  Summary of Stock Option Activity                             Number of Shares     Weighted- Average Exercise Price Per Share     Aggregate Intrinsic Value   Balance at December 31, 2022     177     $ 35,231.40           Granted     –       –           Exercised     –       –           Forfeited     –       –           Expired     (31 )     118,253.58           Balance at June 30, 2023     146     $ 17,603.40     $ –   Exercisable at June 30, 2023     146     $ 17,603.40     $ –     Stock-based compensation expense related to stock options for the three and six months ended June 30, 2022 was $1,000 and $8,000, respectively. As of December 31, 2022, the compensation expense for all unvested stock options had been recognized in the Company’s results of operations.   Compensation Expense Related to Equity Awards   The following table sets forth total stock-based compensation expense for the three and six months ended June 30, 2023 and 2022, in thousands: Schedule of stock based compensation expense                                      Three Months Ended     Six Months Ended       June 30,     June 30,       2023     2022     2023     2022   Research and development   $ 49     $ 53     $ 112     $ 109   General and administrative     45       30       93       160   Total stock-based compensation   $ 94     $ 83     $ 205     $ 269

v3.23.2

Net Loss per Common Share	6 Months Ended
	Jun. 30, 2023
Net loss per common share:
Net Loss per Common Share	8. Net Loss per Common Share   Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding. Diluted net loss per share is computed by dividing the Company’s net loss by the weighted average number of common shares outstanding and the impact of the dilutive effect of potential common stock equivalents, except when the inclusion of such potential common stock equivalents would be anti-dilutive. Dilutive potential common stock equivalents primarily consist of stock options, RSUs and warrants. Therefore, basic and diluted net loss per share applicable to common stockholders were the same for all periods presented because the impact of these items is generally anti-dilutive during periods of net loss.   The weighted average number of common shares outstanding as of June 30, 2023 includes the pre-funded warrants issued in connection with the June 2023 Financing, the exercise of which requires nominal consideration for the delivery of the shares of common stock.   The following table sets forth the potential common shares excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive: Schedule of anti-dilutive stock                 June 30,       2023     2022   Stock options     146       175   Unvested restricted stock units     72,755       57,248   Warrants1     3,217,335       545,401   Total     3,290,236       602,824     1 The weighted average number of common shares outstanding as of June 30, 2023 includes the pre-funded warrants issued in the June 2023 Financing because the exercise of such warrants requires only nominal consideration. Therefore, these pre-funded warrants are not included in the table above.

v3.23.2

Organization and Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Operations	Nature of Operations   Phio Pharmaceuticals Corp. (“Phio” or the “Company”) is a clinical stage biotechnology company whose proprietary INTASYL™ self-delivering RNAi technology platform is designed to make immune cells more effective in killing tumor cells. Phio is developing therapeutics that are designed to leverage INTASYL to precisely target specific proteins that reduce the body’s ability to fight cancer, without the need for specialized formulations or drug delivery systems.   Effective January 26, 2023, the Company completed a 1-for-12 reverse stock split of the Company’s outstanding common stock, including reclassifying an amount equal to the reduction in par value to additional paid-in capital. The reverse stock split did not reduce the number of authorized shares of the Company’s common or preferred stock. All share and per share amounts have been adjusted to give effect to the reverse stock split.
Principles of Consolidation	Principles of Consolidation   The condensed consolidated financial statements include the accounts of Phio and its wholly-owned subsidiary, MirImmune, LLC. All material intercompany accounts have been eliminated in consolidation.
Basis of Presentation	Basis of Presentation   The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Certain information and footnote disclosures that are included in the Company’s annual consolidated financial statements, but that are not required for interim reporting purposes, have been condensed or omitted. Additionally, the Company made adjustments to the outstanding stock option and unvested restricted stock unit balances, and related per share amounts, at December 31, 2022 to reflect final revisions to these outstanding equity awards as a result of the Company’s reverse stock split. The adjustment had no effect on the Company’s condensed consolidated financial statements. These statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission (the “SEC”) on March 22, 2023 (the “2022 Form 10-K”). In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation of the condensed consolidated financial statements have been included. Interim results are not necessarily indicative of results for a full year.
Use of Estimates	Use of Estimates   The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The areas subject to significant estimates and judgement include, among others, those related to the fair value of equity awards, accruals for research and development expenses, useful lives of property and equipment, income taxes, and the valuation allowance on the Company’s deferred tax assets. On an ongoing basis the Company evaluates its estimates and bases its estimates on historical experience and other relevant assumptions that the Company believes are reasonable under the circumstances. Actual results could differ materially from these estimates.
Liquidity	Liquidity   The Company has reported recurring losses from operations since inception and expects to continue to have negative cash flows from operations for the foreseeable future. Historically, the Company’s primary source of funding has been from sales of its securities. The Company’s ability to continue to fund its operations is dependent on obtaining funding from third parties, such as proceeds from the issuance of debt, sale of equity, or strategic opportunities, in order to maintain its operations. This is dependent on a number of factors, including the market demand or liquidity of the Company’s common stock. There is no guarantee that debt, additional equity or other funding will be available to the Company on acceptable terms, or at all. If the Company fails to obtain additional funding when needed, the Company would be forced to scale back or terminate its operations or seek to merge with or to be acquired by another company.   The Company has limited cash resources, has reported recurring losses from operations since inception and has not yet received product revenues. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern, and the Company’s current cash resources may not provide sufficient capital to fund operations for at least the next 12 months from the date of the release of these financial statements. The continuation of the Company as a going concern depends upon the Company’s ability to raise additional capital through an equity offering, debt offering and/or strategic opportunity to fund its operations. There can be no assurance that the Company will be successful in accomplishing these plans in order to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies   There have been no material changes to the significant accounting policies disclosed in the Company’s 2022 Form 10-K.
Recent Accounting Pronouncements	Recent Accounting Pronouncements   There have been no recent accounting pronouncements that have significantly impacted this Quarterly Report on Form 10-Q, beyond those disclosed in the Company’s 2022 Form 10-K.

v3.23.2

Leases (Tables)	6 Months Ended
	Jun. 30, 2023
Leases [Abstract]
Schedule of lease and supplemental balance sheet information	Schedule of lease and supplemental balance sheet information                 June 30, 2023     December 31, 2022   Assets                 Right of use asset   $ 98     $ 161   Liabilities                 Lease liability, current     104       135   Lease liability, non-current     –       35   Total lease liability   $ 104     $ 170   Lease Term and Discount Rate                 Weighted average remaining lease term     0.75       1.25   Weighted average discount rate     4.70%       4.70%
Schedule of future minimum lease payments	Schedule of future minimum lease payments       2023 (remaining)   $ 71   2024     35   Total lease payments     106   Less: Imputed interest     (2 ) Total operating lease liability   $ 104

v3.23.2

Stockholders’ Equity (Tables)	6 Months Ended
	Jun. 30, 2023
Equity [Abstract]
Summary of outstanding warrants	Summary of outstanding warrants                 Number of Shares     Weighted- Average Exercise Price Per Share   Outstanding at December 31, 2022     545,401     $ 54.53   Issued     3,302,706       4.46   Exercised     (175,000 )     0.001   Expired     (1,837 )     1,245.59   Outstanding at June 30, 2023     3,671,270     $ 9.09

v3.23.2

Stock-based Compensation (Tables)	6 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
Summary of RSU activity	Summary of RSU activity                 Number of Shares     Weighted- Average Grant Date Fair Value Per Share   Unvested units at December 31, 2022     47,335     $ 15.03   Granted     43,500       5.24   Vested     (18,080 )     16.96   Forfeited     –       –   Unvested units at June 30, 2023     72,755     $ 8.70
Summary of Stock Option Activity	Summary of Stock Option Activity                             Number of Shares     Weighted- Average Exercise Price Per Share     Aggregate Intrinsic Value   Balance at December 31, 2022     177     $ 35,231.40           Granted     –       –           Exercised     –       –           Forfeited     –       –           Expired     (31 )     118,253.58           Balance at June 30, 2023     146     $ 17,603.40     $ –   Exercisable at June 30, 2023     146     $ 17,603.40     $ –
Schedule of stock based compensation expense	Schedule of stock based compensation expense                                      Three Months Ended     Six Months Ended       June 30,     June 30,       2023     2022     2023     2022   Research and development   $ 49     $ 53     $ 112     $ 109   General and administrative     45       30       93       160   Total stock-based compensation   $ 94     $ 83     $ 205     $ 269

v3.23.2

Net Loss per Common Share (Tables)	6 Months Ended
	Jun. 30, 2023
Net loss per common share:
Schedule of anti-dilutive stock	Schedule of anti-dilutive stock                 June 30,       2023     2022   Stock options     146       175   Unvested restricted stock units     72,755       57,248   Warrants1     3,217,335       545,401   Total     3,290,236       602,824

v3.23.2

Organization and Significant Accounting Policies (Details Narrative)	Jan. 26, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Reverse stock split	1-for-12 reverse stock split

v3.23.2

Collaboration Agreement (Details Narrative) - Clinical Co-Development Agreement [Member] - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Mar. 31, 2021
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Contractual obligation	$ 3,570,000		$ 3,570,000		$ 4,000,000
Expense from contractual obligations	$ 181,000	$ 0	$ 300,000	$ 0

v3.23.2

Fair Value of Financial Instruments (Details Narrative) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 50,000	$ 50,000

v3.23.2

Leases - (Details - Balance sheet lease items) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Leases [Abstract]
Right of use asset	$ 98	$ 161
Lease liability, current	104	135
Lease liability, non-current	0	35
Total lease liability	$ 104	$ 170
Weighted average remaining lease term	9 months	1 year 3 months
Weighted average discount rate	4.70%	4.70%

v3.23.2

Leases (Details - Future lease payments) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Leases [Abstract]
2023 (remaining)	$ 71
2024	35
Total lease payments	106
Less: Imputed interest	(2)
Total operating lease liability	$ 104	$ 170

v3.23.2

Leases (Details Narrative)	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($) ft²	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) ft²	Jun. 30, 2022 USD ($)
Operating Lease, Cost	$ 33,000	$ 33,000	$ 66,000	$ 66,000
Operating Lease, Payments	$ 35,000	$ 34,000	$ 69,000	$ 67,000
Property Subject to Operating Lease [Member]
Operating lease footage | ft²	7,581		7,581
Lease Expiration Date			Mar. 31, 2024

v3.23.2

Preferred Stock (Details Narrative) - USD ($)		1 Months Ended
	Nov. 16, 2022	Nov. 16, 2022	Jun. 30, 2023
Temporary Equity [Line Items]
Preferred stock, shares authorized			10,000,000
Preferred stock, par value			$ 0.0001
Series D Preferred Stock [Member]
Temporary Equity [Line Items]
Temporary Equity, Aggregate Amount of Redemption Requirement			$ 1,750
Series D Preferred Stock [Member] | Robert Bitterman [Member]
Temporary Equity [Line Items]
Issuance of preferred stock, shares	1
Temporary Equity, Stock Issued During Period, Value, New Issues		$ 1,750

v3.23.2

Stockholders' Equity (Details - Warrants outstanding) - Warrant [Member]	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Class of Warrant or Right [Line Items]
Warrants outstanding | shares	545,401
Warrants outstanding, weighted average exercise price | $ / shares	$ 54.53
Warrants issued, shares | shares	3,302,706
Warrants issued, weighted average exercise price | $ / shares	$ 4.46
Warrants exercised, shares | shares	(175,000)
Warrants exercised, weighted average exercise price | $ / shares	$ 0.001
Warrants expired, shares | shares	(1,837)
Warrants expired, weighted average exercise price | $ / shares	$ 1,245.59
Warrants outstanding | shares	3,671,270
Warrants outstanding, weighted average exercise price | $ / shares	$ 9.09

v3.23.2

Stockholders’ Equity (Details Narrative) - USD ($)	1 Months Ended		6 Months Ended
	Jun. 30, 2023	Apr. 30, 2023	Jun. 30, 2023
April 2023 Financing [Member]
Class of Stock [Line Items]
Stock Issued During Period, Shares, New Issues		353,983
Shares Issued, Price Per Share		$ 5.65
Proceeds from Issuance or Sale of Equity		$ 1,538,000
April 2023 Financing [Member] | Warrant Amendment Agreements [Member] | Previously Issued Warrants [Member]
Class of Stock [Line Items]
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 5.40
[custom:AmendedWarrants]		191,619
Proceeds from amendment of warrants		$ 24,000
Equity-Classified Written Call Option, Modification, Equity Issuance, Increase (Decrease) in Equity, Amount		$ 293,000
April 2023 Financing [Member] | Series A Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares		353,983
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 5.40
April 2023 Financing [Member] | Series B Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares		353,983
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 5.40
April 2023 Financing [Member] | Placement Agent Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares		26,549
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 7.0625
June 2023 Financing [Member]
Class of Stock [Line Items]
Shares Issued, Price Per Share	$ 4.28		$ 4.28
Proceeds from Issuance or Sale of Equity	$ 3,510,000
June 2023 Financing [Member] | Series A Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares	934,581		934,581
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 4.03		$ 4.03
June 2023 Financing [Member] | Series B Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares	934,581		934,581
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 4.03		$ 4.03
June 2023 Financing [Member] | Placement Agent Warrants [Member]
Class of Stock [Line Items]
Warrants Issued New Shares	70,094		70,094
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 5.35		$ 5.35
June 2023 Financing [Member] | Registered Shares [Member]
Class of Stock [Line Items]
Stock Issued During Period, Shares, New Issues	233,646
June 2023 Financing [Member] | Unregistered Shares [Member]
Class of Stock [Line Items]
Stock Issued During Period, Shares, New Issues	72,000
June 2023 Financing [Member] | Unregistered Pre Funded Warrants [Member]
Class of Stock [Line Items]
Shares Issued, Price Per Share	$ 4.279		$ 4.279
Warrants Issued New Shares	628,935		628,935
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 0.001		$ 0.001
June 2023 Financing [Member] | June 2023 Pre Funded Warrants [Member]
Class of Stock [Line Items]
Stock issued from conversion of warrants, shares			175,000
Proceeds from Warrant Exercises			$ 175

v3.23.2

Stock-based Compensation (Details - RSU activity) - Restricted Stock Units (RSUs) [Member] - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
RSU's unvested units, beginning balance			47,335
RSU beginning balance, price per share			$ 15.03
RSU's granted	0	0	43,500
RSU's granted, price per share			$ 5.24	$ 10.32
RSU's vested			(18,080)
RSU's vested, price per share			$ 16.96
RSU's forfeited			0
RSU's forfeited, price per share			$ 0
RSU's unvested units, ending balance	72,755		72,755
RSU ending balance, price per share	$ 8.70		$ 8.70

v3.23.2

Stock-based Compensation (Details - Option activity) - Share-Based Payment Arrangement, Option [Member] $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($) $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options outstanding, beginning balance | shares	177
Options outstanding, price per share, beginning balance | $ / shares	$ 35,231.40
Options granted | shares	0
Options granted, price per share | $ / shares	$ 0
Options exercised | shares	0
Options exercised, price per share | $ / shares	$ 0
Options forfeited | shares	0
Options forfeited, price per share | $ / shares
Options expired | shares	(31)
Options expired, price per share | $ / shares	$ 118,253.58
Options outstanding, ending balance | shares	146
Options outstanding, price per share, ending balance | $ / shares	$ 17,603.40
Aggregate Intrinsic Value, outstanding | $	$ 0
Options exercisable | shares	146
Options exercisable, price per share | $ / shares	$ 17,603.40
Aggregate Intrinsic Value, Exercisable | $	$ 0

v3.23.2

Stock-based Compensation (Details - Share-based compensation) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 94	$ 83	$ 205	$ 269
Research and Development Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	49	53	112	109
General and Administrative Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 45	$ 30	$ 93	$ 160

v3.23.2

Stock-based Compensation (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based compensation expense	$ 94,000	$ 83,000	$ 205,000	$ 269,000
Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value			$ 5.24	$ 10.32
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period	0	0	43,500
Share-based compensation expense	$ 94,000	$ 82,000	$ 205,000	$ 261,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value			$ 95,000	128,000
Share-Based Payment Arrangement, Option [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based compensation expense		$ 1,000		$ 8,000

v3.23.2

Net Loss per Share (Details - Antidilutive shares) - shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares	3,290,236	602,824
Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares	146	175
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares	72,755	57,248
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares	3,217,335	545,401

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