UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended December 31, 2023

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

For the transition period fromto

Commission file number: 001-37410

ESSA Pharma Inc.

(Exact name of registrant as specified in its charter)


British Columbia, Canada	98-1250703
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)
Suite 720, 999 West Broadway
Vancouver, BC V5Z 1K5
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code: (778) 331-0962
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 Shares	EPIX	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 check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934). Yes ☐ No ☒

The number of outstanding Common Shares of the registrant, no par value per share, as of February 12, 2024 was 44,238,147.

Table of Contents

ESSA PHARMA INC.

QUARTERLY REPORT ON FORM 10-Q

For the Quarter Ended December 31, 2023

Table of Contents

	PART I. FINANCIAL INFORMATION	8

Item 1.	Financial Statements and Supplementary Data	8

	Condensed Consolidated Interim Balance Sheets as of December 31, 2023 and September 30, 2023	9

	Condensed Consolidated Interim Statements of Operations and Comprehensive Loss for the three months ended December 31, 2023 and 2022	10

	Condensed Consolidated Interim Statements of Cash Flows for the three months ended December 31, 2023 and 2022	11

	Condensed Consolidated Interim Statement of Changes in Shareholders’ Equity for the three months ended December 31, 2023 and 2022	12

	Notes to the Condensed Consolidated Interim Financial Statements	13

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	47
Item 4.	Controls and Procedures	47

	PART II. OTHER INFORMATION	48

Item 1.	Legal Proceedings	48

Item 1A.	Risk Factors	48

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	48

Item 3.	Defaults Upon Senior Securities	48

Item 4.	Mine Safety Disclosures	48

Item 5.	Other Information	48

Item 6.	Exhibits, Financial Statement Schedules	49

	SIGNATURES	50

Table of Contents

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of Canadian securities laws, or collectively, forward-looking statements. Forward-looking statements include statements that may relate to our plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures, financing needs and other information that is not historical information. Many of these statements appear, in particular, under the headings “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. Forward-looking statements can often be identified by the use of terminology such as “subject to”, “believe,” “anticipate,” “plan,” “expect,” “intend,” “estimate,” “project,” “may,” “might,” “will,” “should,” “would,” “could,” “hope,” “can,” the negatives thereof, variations thereon and similar expressions, or by discussions of strategy. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. Examples of such forward looking statements include, but are not limited to statements related to:

●

our ability to advance our product candidate and potential future product candidates through, and successfully complete, clinical trials;

●

our ability to recruit sufficient numbers of patients for future clinical trials, and the benefits expected therefrom;

●

our ability to establish and maintain relationships with collaborators with acceptable development, regulatory and commercialization expertise and the benefits to be derived from such collaborative efforts;

●

our ability to obtain funding for operations, including research funding, and the timing and potential sources of such funding;

●

the initiation, timing, cost, location, progress and success of, strategy and plans with respect to our research and development programs (including research programs and related milestones with regards to next-generation drug candidates and compounds), preclinical studies and clinical trials;

●

the therapeutic benefits, properties, effectiveness, pharmacokinetic profile and safety of our product candidate and potential future product candidates, if any, including the expected benefits, properties, effectiveness, pharmacokinetic profile and safety of our next-generation Aniten compounds;

●

our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others;

●

developments relating to our competitors and our industry, including the success of competing therapies that are or may become available;

●

our ability to achieve profitability;

●

the grant (“CPRIT Grant”) under the Cancer Prevention and Research Institute of Texas (“CPRIT”) and payments thereunder, including any residual obligations;

●

sales of our Common Shares, no par value (the “Common Shares”) under the Open Market Sale AgreementSM between the Company and Jefferies LLC, effective November 3, 2023 (the “ATM Sales Agreement”);

●

our intended use of proceeds from past and future offerings of our securities;

●

the implementation of our business model and strategic plans, including strategic plans with respect to patent applications and strategic collaborations and partnerships;

●

our ability to identify, develop and commercialize product candidates;

●

our commercialization, marketing and manufacturing capabilities and strategy;

●

our expectations regarding federal, state, provincial and foreign regulatory requirements, including our plans with respect to anticipated regulatory filings;

●

whether we will receive, and the timing and costs of obtaining, regulatory approvals in the United States, Canada and other jurisdictions;

●

the accuracy of our estimates of the size and characteristics of the markets that may be addressed by our product candidate and potential future product candidates, if any;

Table of Contents

●

our ability to maintain operations, development programs, preclinical studies, clinical trials and raise capital as a result of global macroeconomic factors including inflation, supply chain issues and any current or future impact related to widespread health concerns, pandemics, or epidemics, and other outbreaks of illness;

●

the rate and degree of market acceptance and clinical utility of our potential future product candidates, if any;

●

the timing of, and our ability and our collaborators’ ability, if any, to obtain and maintain regulatory approvals for our product candidate and potential future product candidates, if any;

●

our expectations regarding market risk, including inflation, interest rate changes and foreign currency fluctuations;

●

our ability to engage and retain the employees required to grow our business;

●

the compensation that is expected to be paid to our employees;

●

our future financial performance and projected expenditures; and

●

estimates of our financial condition, expenses, future revenue, capital requirements and our need for additional financing and potential sources of capital and funding.

Such statements reflect our current views with respect to future events, are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that are inherently subject to significant medical, scientific, business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including those described under “Risk Factors” in our Annual Report on Form 10-K. All forward-looking statements included in this Quarterly Report on Form 10-Q, are based upon our current expectations and various assumptions. Certain assumptions made in preparing the forward-looking statements include, but are not limited to:

●

our ability to conduct clinical studies involving our product candidate and to identify any future product candidates;

●

our ability to obtain regulatory and other approvals to commence clinical trials involving any future product candidates;

●

our ability to obtain positive results from research and development activities, including clinical trials;

●

the availability of sufficient financing on reasonable terms;

●

our ability to obtain required regulatory approvals;

●

our ability to protect patents and proprietary rights;

●

our ability to successfully out-license or sell future products, if any, and in-license and develop new products;

●

the absence of material adverse changes in our industry or the global economy;

●

our ability to attract and retain key personnel;

●

our continued compliance with third-party license terms and non-infringement of third-party intellectual property rights;

●

our ability to maintain good business relationships with our strategic partners; and

●

our ability to understand and predict market competition.

We believe there is a reasonable basis for our current expectations, views and assumptions, but they are inherently uncertain. We may not realize our expectations and our views and assumptions may not prove correct. Actual results could differ materially from those described or implied by such forward-looking statements. In evaluating forward-looking statements, investors should specifically consider the following uncertainties and factors, among others (including those set forth under the heading “Risk Factors” in our Annual Report on Form 10-K), that could affect future performance and cause actual results to differ materially from those matters expressed in or implied by forward-looking statements

SEC Form 10-Q filed by ESSA Pharma Inc.