Quarterly report pursuant to Section 13 or 15(d)

1. The Company

v3.8.0.1
1. The Company
9 Months Ended
Sep. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
The Company

Background

 

Xenetic Biosciences, Inc. (“Xenetic” or the “Company)” incorporated in the state of Nevada and based in Lexington, Massachusetts, is a biopharmaceutical company focused on the discovery, research and development of next-generation biologic drugs and novel orphan oncology therapeutics. Xenetic’s proprietary drug development platforms include PolyXenTM, which enables next-generation biologic drugs by improving their half-life and other pharmacological properties. The Company incorporates its patented and proprietary technologies into a number of drug candidates currently under development either in-house or with biotechnology and pharmaceutical collaborators in order to create what it believes will be next-generation biologic drugs and therapeutics. Xenetic’s lead investigational product candidates include oncology therapeutic XBIO-101 (sodium cridanimod) for the treatment of progesterone resistant endometrial cancer (“EC”).

 

Going Concern and Management’s Plan

 

The Company incurred a net loss of approximately $8.0 million for the nine months ended September 30, 2017, and had an accumulated deficit of $150.4 million as of September 30, 2017. The Company’s working capital was approximately ($0.1) million as of September 30, 2017, and $6.5 million as of December 31, 2016. The Company expects to continue incurring losses for the foreseeable future and will need to raise additional capital or pursue other strategic alternatives in the near term in order to continue pursuit of its business plan and continue as a going concern. On October 27, 2017, the Company entered into a sublicensing agreement that resulted in a one-time $7.5 million payment in November 2017 and is expected to result in future single digit royalty payments based on product sales. See Note 12, Subsequent Events, to these unaudited condensed consolidated financial statements for further details.

 

The Company believes that it has access to capital resources through possible public or private equity offerings, debt financings, corporate collaborations or other means; however, it has not secured any commitment for additional financing at this time. The terms, timing and extent of any future financing will depend upon several factors, including the achievement of progress in its clinical development programs, its ability to identify and enter into licensing or other strategic arrangements, and factors related to financial, economic and market conditions, many of which are beyond its control.

 

While these condensed consolidated financial statements have been prepared on a going concern basis, if the Company does not successfully raise additional working capital, there can be no assurance that the Company will be able to continue its operations, and these conditions raise substantial doubt about its ability to continue as a going concern. Under such circumstances, the Company would have to further reduce the planned scale of, or possibly suspend, some or all of its pre-clinical development initiatives and clinical trials. In addition, the Company would have to continue to reduce its general and administrative and other operating expenses and delay or cease the purchase of clinical research services if and until the Company is able to obtain additional financing. The accompanying condensed consolidated financial statements do not include any adjustments related to the recoverability or classification of asset carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.