CST: 25/08/2016 15:05:59   

RespireRx Pharmaceuticals Inc. Files December 31, 2015 Annual Report on Form 10-K

149 Days ago

Provides Update on Current Operations and Plans for 2016

GLEN ROCK, NJ--(Marketwired - Mar 29, 2016) - RespireRx Pharmaceuticals Inc. (OTCQB: RSPI) ("RespireRx" or the "Company"), a leader in the development of medicines for respiratory disorders, including sleep apneas and drug-induced respiratory depression, has filed its December 31, 2015 Annual Report on Form 10-K and is hereby providing an update on the Company's current operations and its plans for 2016.

The Company was formed in 1987 under the name Cortex Pharmaceuticals, Inc. to engage in the discovery, development and commercialization of innovative pharmaceuticals for the treatment of neurological and psychiatric disorders. To reflect its current strategic focus on respiratory disorders, the Company changed its name from Cortex Pharmaceuticals, Inc. to RespireRx Pharmaceuticals Inc. on December 16, 2015.

Comments by Chief Executive Officer

James S. Manuso, Ph.D., President, Chief Executive Officer and Vice Chairman of RespireRx, commented, "The recently completed year ended December 31, 2015 was a productive and noteworthy year for RespireRx. We concentrated on the continuing focus of our efforts on respiratory diseases and illnesses in which respiration is compromised and for which there are no approved medicines, and we expanded our clinical trial activities by initiating a Phase 2A clinical trial with CX1739, the Company's proprietary lead ampakine, during March 2016."

Dr. Manuso continued, "Also currently underway is a 120 patient, Phase 2B clinical trial with dronabinol being conducted by the University of Illinois, with data expected in the third quarter of 2016. Under a license agreement with the University of Illinois, the Company has rights to patents claiming the use of cannabinoids for the treatment of sleep-related breathing disorders."

Dr. Manuso concluded, "These efforts have enabled RespireRx to emerge at the forefront of research and development in the fields of sleep apneas and drug-induced respiratory depression. Going forward, it is our goal to build on our 2015 research, clinical and regulatory accomplishments, and to continue the development of our Phase 2 medicines now in clinical trials. We look forward to updating you during 2016 as we continue to move forward." 

Corporate Overview

Key corporate developments during 2015 include the following:

  • On August 18, 2015, the Company entered into an employment agreement with Dr. James S. J. Manuso to be its new President and Chief Executive Officer. Dr. Manuso was also appointed to the Company's Board of Directors and elected as Vice Chairman of the Board of Directors.

  • Concurrent with the hiring of Dr. Manuso, Dr. Arnold S. Lippa was named Chief Scientific Officer of the Company and resigned as President and Chief Executive Officer. Dr. Lippa continues to serve as the Company's Executive Chairman and as a member of the Board of Directors.

  • The Company raised aggregate gross proceeds of approximately $1,405,000 in the final closing of a convertible note and warrant offering that commenced in 2014 and concluded in 2015, and a unit offering of common shares and warrants that commenced and concluded in 2015. During the first quarter of 2016, the Company raised an additional approximately $195,000 from the sale of units of common shares and warrants.

Research and Development Overview

RespireRx is a leader in the development of medicines for respiratory disorders, holding exclusive licenses and owns patents and patent applications for certain families of chemical compounds that claim the chemical structures and their use in the treatment of a variety of disorders, as well as claims for novel uses of known drugs.

The Company has a pipeline of compounds in Phase 2 clinical development focused on developing drug treatments for a variety of different breathing disorders. Clinical development in the area of respiratory disorders, particularly drug-induced respiratory depression and sleep apnea, has created opportunities for the development and commercialization of the Company's compounds. 

RespireRx's pharmaceutical candidates in development are derived from two platforms, as described below. 

  • The first platform is the class of compounds known as cannabinoids, in particular, dronabinol. Under a license agreement with the University of Illinois, the Company has rights to patents claiming the use of cannabinoids for the treatment of sleep-related breathing disorders. In a double-blind, placebo-controlled, dose-ascending Phase 2A clinical study conducted by the Company, dronabinol produced a statistically significant reduction in the Apnea-Hypopnea Index, the primary therapeutic end-point, and was observed to be safe and well-tolerated in a group of patients with Obstructive Sleep Apnea ("OSA"). 

  • The second platform of medicines being developed by RespireRx is a class of proprietary compounds known as ampakines, which act to enhance the actions of the excitatory neurotransmitter glutamate at AMPA glutamate receptors. Several ampakines, in both oral and injectable form, are being developed by the Company for the treatment of a variety of breathing disorders. In clinical studies, select ampakines have shown preliminary efficacy in central sleep apnea and in the control of respiratory depression produced by opioids, without altering the opiois analgesic effects. In animal models of orphan disorders, such as Pompe Disease, spinal cord damage and perinatal respiratory distress, it has been demonstrated that certain ampakines improve breathing function. The Company's compounds belong to a new class that does not display the undesirable side effects previously reported for other ampakines.

The year 2015 was an important period that saw the expansion and implementation of the Company's research and development programs, including the following key developments:

  • In an ongoing study, the University of Illinois and three other centers currently are investigating dronabinol in a six week, double-blind, placebo-controlled Phase 2B clinical trial in 120 patients with OSA. This study, which the University of Illinois has indicated it expects to be completed during the second quarter of 2016, is fully funded by the National Heart, Lung and Blood Institute of the National Institutes of Health. The Company is not managing or funding this ongoing clinical trial. Under the terms of the Company's license agreement with the University of Illinois, the Company will have access to the data from this potentially pivotal Phase 2B study and the commercialization rights.

  • In September 2015, the Company filed an Investigational New Drug (IND) application with the FDA to conduct a double-blind, placebo-controlled, dose-ascending Phase 2A clinical trial in approximately 18 subjects to determine the ability of orally administered CX1739, the Company's proprietary lead ampakine, to prevent the respiratory depression produced by remifentanil, a potent opioid, without altering remifentanil's analgesic properties. The clinical protocol was designed to evaluate the safety and efficacy of three escalating doses of CX1739 versus placebo when administered prior to remifentanil, with respiration, analgesia and a number of other clinical measures being taken after administration of both drugs. The Company's IND for CX1739 was allowed on February 25, 2016 and the trial was initiated in March 2016 at the Duke University School of Medicine Clinical Research Unit. The Company expects to incur approximately $750,000 of direct costs in 2016 with respect to this clinical trial, and to complete the clinical trial in approximately four months.

  • Based on preliminary, positive results for CX1739 in a previously completed Phase 2A clinical trial in patients with sleep apnea, the Company has assembled a clinical advisory panel composed of key opinion leaders and is developing preliminary plans for a Phase 2B study in patients with central sleep apnea.

  • CX1942, a soluble ampakine, is being developed as an injectable formulation to be used in a hospital or surgical setting in conjunction with opioids and anesthetics either during or after surgery. In collaboration with investigators at the University of Florida and funded by a Small Business Innovation Research ("SBIR") contract from the National Institute of Drug Abuse, animal studies completed in 2015 indicate that CX1942 injected intravenously, intramuscularly or subcutaneously can reverse the respiratory depression produced by fentanyl and possibly opioids in combination with other drugs. Such data will be used to develop an injectable formulation with the flexibility to be administered via different routes.

  • During 2015, as part of its preclinical research program, the Company, through Dr. John Greer, Chairman of the Company's Scientific Advisory Board, engaged in research collaborations with a number of academic institutions, resulting in a number of published articles in scientific journals. As part of the Company's collaborative program with the University of Florida, studies with the Company's ampakines have determined that these compounds improve breathing in animal models of spinal cord injury and Pompe Disease. Based on these studies, the Company is developing preliminary plans for Phase 2A studies in patients with spinal cord injury and Pompe disease who experience respiratory difficulties.

  • As of October 19, 2015, the Company entered into an agreement with the Medications Development Program of the National Institute of Drug Abuse ("NIDA") to conduct research on the Company's ampakine compounds CX717 and CX1739. Under the agreement, NIDA will evaluate the compounds using pharmacologic, pharmacokinetic and toxicologic protocols to determine the potential effectiveness of the ampakines for the treatment of drug abuse and addiction. Initial studies will focus on cocaine and methamphetamine addiction and abuse, and will be contracted to outside testing facilities and/or government laboratories, with all costs to be paid by NIDA. The Company will provide NIDA with supplies of CX717 and CX1739 and will work with the NIDA staff to refine the protocols and dosing parameters. The Company will retain all intellectual property, proprietary and commercialization rights to these compounds.

  • On January 12, 2016, the Company entered into a Research Contract with the University of Alberta in order to test the efficacy of ampakines using a variety of dosages and formulations as potential treatments for Pompe Disease, apnea of prematurity and spinal cord injury, as well as to conduct certain electrophysiological studies to explore the ampakine mechanism of action for central respiratory depression. The Company agreed to pay the University of Alberta total consideration of approximately CAD$146,000 (currently approximately US$110,000), of which all but US$64,000 has already been incurred and paid for directly or in-kind. The University of Alberta will receive matching funds through a grant from the Canadian Institutes of Health Research, while the Company will retain the rights to research results and any patentable intellectual property generated by the research.

Financial Overview and Selected Financial Information

The Company incurred net losses of $5,961,892 and $2,707,535 for the years ended December 31, 2015 and 2014, respectively, and negative operating cash flows of $1,296,100 and $885,869 for the years ended December 31, 2015 and 2014, respectively. The Company expects to continue to incur net losses and negative operating cash flows for the next few years.

As a result of adjustments related to the Series G 1.5% Convertible Preferred Stock, the Company incurred net losses attributable to common stockholders of $5,968,759 and $12,768,307 for the years ended December 31, 2015 and 2014, reflecting a net loss per share of $0.02 for 2015 and $0.07 for 2014. 

At December 31, 2015, the Company had 489,846,883 shares of common stock outstanding, as compared to 232,145,326 shares of common stock outstanding as of December 31, 2014. The exercise of all outstanding stock options and warrants, and the conversion of all outstanding convertible debt and equity securities, would have resulted in the issuance of an additional 505,235,433 shares of common stock.

If not earlier converted, the remaining outstanding shares of Series G 1.5% Convertible Preferred Stock will be automatically and mandatorily redeemed by conversion into shares of common stock on April 17, 2016, the two year anniversary of the date that the last shares of Series G 1.5% Convertible Preferred Stock were issued in the Series G Private Placement, at the Conversion Price of $0.0033 per share.

At December 31, 2015, the Company had a working capital deficit of $2,922,279, as compared to a working capital deficit of $2,280,035 at December 31, 2014, reflecting a decrease in working capital of $642,244 during 2015. At December 31, 2015, the Company had cash aggregating $53,199, as compared to $162,752 at December 31, 2014, reflecting a decrease in cash of $109,553 during 2015. 

The Company will need to continue to raise additional capital to be able to pay its obligations and fund its business activities going forward. As a result of the Company's current financial situation, the Company has limited access to external sources of debt and equity financing. Accordingly, there can be no assurances that the Company will be able to secure additional financing in the amounts necessary to fully fund its operating and debt service requirements. If the Company is unable to access sufficient cash resources on a timely basis, the Company may need to scale back its research and development efforts and could be forced to discontinue operations entirely. 

Additional information with respect to the Company's financial condition, results of operations, cash flows, capital structure and other matters involving the business, operations and research and development activities of the Company is included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, as filed with the U.S. Securities and Exchange Commission.

About RespireRx Pharmaceuticals Inc.

RespireRx Pharmaceuticals Inc. is a leader in the development of medicines for respiratory disorders, with a focus on sleep apneas and drug-induced respiratory depression. The Company holds exclusive licenses and owns patents and patent applications for certain families of chemical compounds that claim the chemical structures and their use in the treatment of a variety of disorders, as well as claims for novel uses of known drugs.

RespireRx's pharmaceutical candidates in development are derived from two platforms, as described below. 

The first platform is the class of compounds known as cannabinoids, in particular, dronabinol. Under a license agreement with the University of Illinois, the Company has rights to patents claiming the use of cannabinoids for the treatment of sleep-related breathing disorders. In a double-blind, placebo-controlled, dose-ascending Phase 2A clinical study conducted by the Company, dronabinol produced a statistically significant reduction in the Apnea-Hypopnea Index, the primary therapeutic end-point, and was observed to be safe and well-tolerated in a group of patients with Obstructive Sleep Apnea ("OSA"). 

The University of Illinois and three other centers currently are investigating dronabinol in a potentially pivotal, six week, double-blind, placebo-controlled Phase 2B clinical trial in 120 patients with OSA. This study, which the University of Illinois has indicated it expects to be completed during the second quarter of 2016, is fully funded by the National Heart, Lung and Blood Institute of the National Institutes of Health. The Company is not managing or funding this ongoing clinical trial.

The second platform of medicines being developed by RespireRx is a class of proprietary compounds known as ampakines, which act to enhance the actions of the excitatory neurotransmitter glutamate at AMPA glutamate receptors. Several ampakines, in both oral and injectable form, are being developed by the Company for the treatment of a variety of breathing disorders. In clinical studies, select ampakines have shown preliminary efficacy in central sleep apnea and in the control of respiratory depression produced by opioids, without altering their analgesic effects. In animal models of orphan disorders, such as Pompe Disease, spinal cord damage and perinatal respiratory distress, it has been demonstrated that certain ampakines improve breathing function. The Company's compounds belong to a new class of ampakines that do not display the undesirable side effects previously reported in animal models of earlier generations.

Additional information about the Company and the matters discussed herein can be obtained on the Company's website at www.RespireRx.com or in the Company's filings with the U.S. Securities and Exchange Commission at www.sec.gov.

Special Note Regarding Forward-Looking Statements : Certain statements included or incorporated by reference in this news release, including information as to the future financial or operating performance of the Company and its drug development programs, constitute forward-looking statements. The words "believe," "expect," "anticipate," "contemplate," "target," "plan," "intend," "continue," "budget," "estimate," "may," "schedule" and similar expressions identify forward-looking statements. Forward-looking statements include, among other things, statements regarding future plans, targets, estimates and assumptions. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company. Due to these various risks and uncertainties, actual events may differ materially from current expectations. Investors are cautioned that forward-looking statements are not guarantees of future performance and, accordingly, investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Forward-looking statements are made as of the date of this news release and the Company disclaims any intent or obligation to update publicly such forward-looking statements, whether as a result of new information, future events or results or otherwise.

Company Contact:

Jeff Margolis
Vice-President, Treasurer and Secretary
Telephone: (917) 834-7206
E-mail: jmargolis@respirerx.com