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EX-32.1 - EXHIBIT 32.1 - Aevi Genomic Medicine, Inc.v472241_ex32-1.htm
EX-31.2 - EXHIBIT 31.2 - Aevi Genomic Medicine, Inc.v472241_ex31-2.htm
EX-31.1 - EXHIBIT 31.1 - Aevi Genomic Medicine, Inc.v472241_ex31-1.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 10-Q

 

 

 

(Mark One)

 

x

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

 

For the quarterly period ended June 30, 2017

 

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: 001-35112

 

 

Aevi Genomic Medicine, Inc.
(Exact name of registrant as specified in its charter)

 

 

Delaware
(State or other jurisdiction of
incorporation or organization)
98-0217544
(I.R.S. Employer
Identification No.)
   
435 Devon Park Drive, Suite 715
Wayne, Pennsylvania
(Address of Principal Executive Offices)
19087
(Zip Code)
   
(610) 254-4201
(Registrant’s telephone number, including area code)
   
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

 

 

 

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 x No ¨

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes x No ¨

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one):

 

Large accelerated filer ¨ Accelerated filer x
Non-accelerated filer ¨ (Do not check if a smaller reporting company) 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 Exchange Act). Yes ¨ No x

 

As of August 4, 2017, the registrant had 37,110,043 shares of common stock, $0.0001 par value, outstanding.

 

 

 

 

 

 

AEVI GENOMIC MEDICINE, INC.
FORM 10-Q
TABLE OF CONTENTS

 

Page

 

PART I – FINANCIAL INFORMATION 1
   
ITEM 1. - Financial Statements 1
   
CONDENSED CONSOLIDATED BALANCE SHEET (In thousands, except share data) 1
   
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (In thousands, except share and per share data) 2
   
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (In thousands) 3
   
NOTES TO THE FINANCIAL STATEMENTS (In thousands, except share and per share data) 4
   
ITEM 2. - Management’s Discussion and Analysis of Financial Condition and Results of Operations 9
   
ITEM 3. - Quantitative and Qualitative Disclosures about Market Risk 14
   
ITEM 4. - Controls and Procedures 15
   
PART II - OTHER INFORMATION 15
   
ITEM 1. - Legal Proceedings 15
   
ITEM 1A - Risk Factors 15
   
ITEM 2. - Unregistered Sales of Equity Securities and Use of Proceeds 16
   
ITEM 3. - Defaults Upon Senior Securities 16
   
ITEM 4. - Mine Safety Disclosures 16
   
ITEM 5. - Other Information 16
   
ITEM 6. – Exhibits 16

 

Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to the “Company,” “Aevi Genomic Medicine,” “we,” “us” and “our” refer to Aevi Genomic Medicine, Inc., a Delaware corporation organized on January 27, 2000, and its wholly-owned subsidiaries, Medgenics Medical (Israel) Ltd. and neuroFix, LLC. We use TARGTTM, TARGTEPOTM, DermaVacTM, GeneRideTM and the Aevi Genomic Medicine logo as trademarks in the United States and elsewhere. All other trademarks or trade names referred to in this document are the property of their respective owners.

 

 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. - Financial Statements

 

CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands, except share data)

 

   June 30,
2017
   December 31,
2016
 
   Unaudited   Audited 
ASSETS          
           
CURRENT ASSETS:          
           
Cash and cash equivalents  $21,357   $39,838 
Prepaid expenses and other current assets   1,075    335 
           
Total current assets   22,432    40,173 
           
LONG-TERM ASSETS:          
           
Restricted lease deposits   11    11 
Property and equipment, net   297    377 
           
Total long-term assets   308    388 
           
Total assets  $22,740   $40,561 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
           
CURRENT LIABILITIES:          
           
Trade payables  $1,881   $137 
Other accounts payable and accrued expenses   3,036    5,446 
           
Total current liabilities   4,917    5,583 
           
Total liabilities   4,917    5,583 
           
STOCKHOLDERS’ EQUITY:          
           
Common stock - $0.0001 par value; 100,000,000 shares authorized; 37,110,043 shares issued and 37,110,043 shares outstanding at June 30, 2017; 37,112,343 shares issued and 37,103,843 shares outstanding at December 31, 2016  $4   $4 
Additional paid-in capital   217,033    215,008 
Accumulated deficit   (199,214)   (180,034)
           
Total stockholders’ equity   17,823    34,978 
           
Total liabilities and stockholders’ equity  $22,740   $40,561 

 

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

 

 -1- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except share and per share data)

 

   Six months ended
June 30,
   Three months ended
June 30,
 
   2017   2016   2017   2016 
   Unaudited   Unaudited 
Research and development expenses  $13,614   $15,692   $5,667   $8,741 
                     
General and administrative expenses   5,357    7,136    2,369    2,945 
                     
Operating loss   (18,971)   (22,828)   (8,036)   (11,686)
Financial income / (expense)   21    (20)   3    (18)
                     
Loss before taxes on income   (18,950)   (22,848)   (8,033)   (11,704)
                     
Taxes on income   -    3    -    3 
                     
Net loss  $(18,950)  $(22,851)  $(8,033)  $(11,707)
                     
Basic and diluted loss per share  $(0.51)  $(0.69)  $(0.22)  $(0.35)
Weighted average number of common stock used in computing basic loss per share   37,109,157    33,211,665    37,110,043    33,469,789 

 

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

 

 -2- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)

 

   Six months ended
June 30,
 
   2017   2016 
   Unaudited 
         
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss  $(18,950)  $(22,851)
Adjustments to reconcile loss to net cash used in operating activities:          
Depreciation   81    125 
Stock-based compensation   1,775    4,263 
Changes in operating assets and liabilities:          
Prepaid expenses and other current assets   (740)   (348)
Trade payables   1,744    (819)
Other accounts payable and accrued expenses   (2,410)   703 
Restricted lease deposits   -    (11)
Net cash used in operating activities  $(18,500)  $(18,938)
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Purchase of property and equipment  $-   $(190)
Net cash used in investing activities  $-   $(190)
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Proceeds from issuance of shares, net  $-   $19,678 
Proceeds from exercise of options and warrants   19    72 
Net cash provided by financing activities  $19   $19,750 
           
(Decrease) increase in cash and cash equivalents   (18,481)   622 
           
Balance of cash and cash equivalents at the beginning of the period   39,838    53,064 
           
Balance of cash and cash equivalents at the end of the period  $21,357   $53,686 
           
Supplemental disclosure of non-cash flow information:          
Cash paid during the period for taxes  $-   $3 

 

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

 

 -3- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY

 

NOTES TO THE FINANCIAL STATEMENTS
(In thousands, except share and per share data)

 

NOTE 1:- GENERAL

 

a.Aevi Genomic Medicine Inc. (the “Company”), formerly Medgenics Inc., was incorporated in January 2000 in Delaware. The Company has a wholly-owned subsidiary, Medgenics Medical Israel Ltd. (the “Subsidiary”), which was incorporated in Israel in March 2000. The Company is a clinical stage biopharmaceutical company with an emphasis on genomic medicine.

As of October 21, 2016 the Company’s common stock is traded on the NASDAQ Global Market. Prior to October 21, 2016 the Company’s common stock was traded on the NYSE MKT.

 

b.As reflected in the accompanying financial statements, the Company incurred a net loss for the six month period ended June 30, 2017 of $18,950 and had a negative cash flow from operating activities of $18,500 during the six month period ended June 30, 2017. The accumulated deficit as of June 30, 2017 is $199,214. As of June 30, 2017, the Company had cash and cash equivalents of $21,357, which it believes will provide funding for its operations into the second quarter of 2018. The Company and the Subsidiary have not yet generated revenues from product sales.

 

NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES

 

a.The accompanying unaudited condensed financial statements of the Company, have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and the rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2016 (“2016 Form 10-K”) as filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements that would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year as reported in the 2016 Form 10-K have been omitted.

 

b.Recently issued accounting pronouncements:

In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which defines management’s responsibility to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures. The Company adopted this standard as of December 31, 2016. Management has concluded that substantial doubt exists with respect to the Company’s ability to continue as a going concern through one year after the issuance of the financial statements. See, “Note 3: – Liquidity Risks and Management Plans.”

In 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes, will require deferred income tax liabilities and assets to be classified as noncurrent. The Company adopted this standard as of March 31, 2017. The Company determined that there was no material impact on the Company’s consolidated financial statements.

In 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which will establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The pronouncement is effective for fiscal years beginning after December 15, 2018. The Company is currently evaluating the effect this guidance will have on the Company’s consolidated financial statements.

 

 -4- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY

 

In 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting, which is meant to reduce complexity involving several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, classifications of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 became effective for the Company in the first quarter of 2017 and was applied using a modified retrospective transition approach. Under ASU 2016-09 the Company has elected to no longer estimate forfeiture rates in determining its stock compensation expense and will true up forfeitures as they occur. As a result of the adoption, the Company recorded a cumulative adjustment to accumulated deficit as of December 31, 2016 for $230.

 

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.

 

NOTE 3:- LIQUIDITY RISKS AND MANAGEMENT’S PLANS

 

The Company has financed its operations primarily through issuance of equity and grants from other third parties. As of June 30, 2017, the Company had cash and cash equivalents of $21,357 and liabilities of $4,917.

 

The future success of the Company is dependent on its ability to develop its product candidates and ultimately upon its ability to attain profitable operations. The Company is subject to a number of risks similar to other early-stage life science companies, including, but not limited to, successful discovery and development of its product candidates, raising additional capital with favorable terms, development by its competitors of new technological innovations, protection of proprietary technology and market acceptance of the Company’s products. The successful discovery and development of product candidates requires substantial working capital which may not be available to the Company on favorable terms.

 

The Company expects to continue to incur operating losses in the future and require additional capital to further advance its programs, if warranted by the results of its clinical trials, and support its operations. The Company does not have sufficient existing cash and cash equivalents for at least the twelve months following the date that the financial statements are issued. These conditions raise substantial doubt about its ability to continue as a going concern within one year after the date that these financial statements are issued.

 

To alleviate the conditions that raise substantial doubt about the Company’s ability to continue as a going concern, management is exploring various sources of funding such as strategic collaborations, licensing agreements, and issuance of equity and/or debt securities as a source of liquidity. If we raise additional funds through strategic collaborations and alliances or licensing arrangements with third parties, which may include existing collaboration partners, we may have to relinquish valuable rights to our technologies or product candidates, including AEVI-001 and AEVI-002, or grant licenses on terms that are not favorable to us. To the extent that the Company raises additional capital through the sale of equity, the ownership interest of the existing shareholders will be diluted and other preferences may be necessary that adversely affect the rights of the existing shareholders.

 

NOTE 4:- COMMITMENTS AND CONTINGENCIES

 

In November 2014, the Company entered into a research agreement with the Children’s Hospital of Philadelphia (CHOP). Under the terms of the agreement, the Company agreed to sponsor research at CHOP with respect to the recruitment and genetic analysis of patients with rare diseases to accelerate discovery of diagnostic and therapeutic targets.

 

CHOP granted the Company options over certain intellectual property created in the course of the research. The initial term of the Research Agreement was one year. The Company had the unilateral right to extend the term of the Research Agreement for an additional two-year term beyond the initial term and to provide additional funding for such an extension.

 

In June 2017 the Company extended the term of the CHOP Research Agreement for an additional period through June 2019. Per the terms of the extension, the Company is obligated to pay CHOP $5,937 in 2018 and $2,375 in 2019.

 

 -5- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY

 

NOTE 5:- STOCKHOLDERS’ EQUITY

 

a.Issuance of stock options and warrants to employees and directors:

A summary of the Company’s activity for options and warrants granted to employees and directors is as follows:

 

   Six months ended
June 30, 2017
 
   Number of
options and
warrants
   Weighted
average
exercise
price
   Weighted average
remaining
contractual
terms (years)
   Aggregate
intrinsic
value
 
Outstanding at December 31, 2016   10,433,396   $5.78    6.08   $3,383 
                     
Granted   1,752,900   $3.71           
                     
Exercised   (6,200)  $3.14           
                     
Forfeited   (1,631,670)  $8.60           
                     
Outstanding at June 30, 2017   10,548,426   $5.00    6.58   $- 
                     
Vested and expected to vest at June 30, 2017   10,548,426   $5.00    6.58   $- 
                     
Exercisable at June 30, 2017   7,085,943   $3.48    3.58   $- 

 

As of June 30, 2017, there was $7,140 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted to employees and directors. That cost is expected to be recognized over a weighted-average period of 2.06 years.

 

b.Issuance of options and warrants to consultants:

A summary of the Company’s activity for warrants and options granted to consultants is as follows:

 

    Six months ended
June 30, 2017
 
   Number of
options and
warrants
   Weighted
average
exercise
price
   Weighted average
remaining
contractual
terms (years)
   Aggregate
intrinsic
value
 
Outstanding at December 31, 2016   390,821   $6.95    1.43   $114 
                     
Granted   -   $-           
                     
Exercised   -   $-           
                     
Forfeited   (194,473)  $9.17           
                     
Outstanding at June 30, 2017   196,348   $4.75    2.03   $- 
                     
Vested and expected to vest at June 30, 2017   196,348   $4.75    2.03   $- 
                     
Exercisable at June 30, 2017   179,681   $4.33    1.47   $- 
                     

 

 -6- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY

 

As of June 30, 2017, there was a de minimis amount of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted to consultants. That cost is expected to be recognized over a weighted-average period of 0.31 years.

 

c.Stock-based compensation expense:

Compensation expense related to warrants and options granted to employees, directors and consultants was recorded in the Consolidated Statement of Operations in the following line items:

 

   Six months ended
June 30,
   Three months ended
June 30,
 
   2017   2016   2017   2016 
Research and development expenses  $765   $1,486   $320   $858 
General and administrative expenses  $1,010   $2,777   $454   $1,005 

 

d.Summary of shares to be issued upon exercise of options and warrants:

A summary of shares to be issued upon exercise of all the options and warrants, segregated into ranges, as of June 30, 2017 is presented in the following table:

 

      As of June 30, 2017 
Options / Warrants  Exercise price
per share ($) 
  Shares to be
issued upon
exercise of
options and
warrants
outstanding
   Shares to be
issued upon
exercise of
options and
warrants
exercisable
   Weighted
average
remaining
contractual
terms of
options and
warrants (in
years)
 
Options:               
Granted to employees and directors                  
   1.07 – 2.66   646,000    75,000    9.3 
   3.14 – 5.07   6,272,662    4,244,210    6.4 
    5.10 – 10.80   3,629,764    2,766,733    6.3 
       10,548,426    7,085,943      
                   
Granted to consultants                  
   4.82 – 6.65   64,348    47,681    4.3 
Total shares to be issued upon exercise of options      10,612,774    7,133,624      
                   
Warrants:                  
                   
Granted to consultants                  
   3.76 – 4.99   125,000    125,000    1.0 
   11.16   7,000    7,000    0.0 
       132,000    132,000      
                   
Granted to investors  6.78 – 8.34   3,124,319    3,124,319    0.6 
                   
Total shares to be issued upon exercise of warrants      3,256,319    3,256,319      
                   
Total shares to be issued upon exercise of options and warrants      13,869,093    10,389,943      

 

 -7- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

NOTE 6:- LOSS PER SHARE

 

The Company computes basic net loss per share by dividing net loss by the weighted average number of shares outstanding, which includes stock issued and outstanding. The Company computes diluted net loss per share by dividing net loss by the weighted average number of shares and potential shares from outstanding stock options. Since the Company had a net loss for all periods presented, the effect of all potentially dilutive securities is anti-dilutive. Accordingly, basic and diluted net loss per share is the same for the six and three months ended June 30, 2017 and 2016.

 

The following table presents anti-dilutive shares for the six and three months ended June 30, 2017 and 2016:

 

   Six months ended
June 30,
   Three months ended
June 30,
 
   2017   2016   2017   2016 
Weighted-average anti-dilutive shares related to:                    
Outstanding stock options   11,038,485    10,265,456    11,306,828    11,123,995 
Outstanding warrants   4,799,797    6,856,409    4,691,405    5,323,385 
    15,838,282    17,121,865    15,998,233    16,447,380 

 

 -8- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

ITEM 2. - Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

The following discussion and analysis of our financial condition and results of operations should be read together with our financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q.

 

Forward-Looking Statements

 

This Quarterly Report on Form 10-Q contains “forward-looking statements” that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The statements contained in this Quarterly Report on Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements are often identified by the use of words such as, but not limited to, “can,” “may,” “will,” “should,” “could,” “would,” “expects,” “plans,” “continues,” “anticipates,” “intends,” “seeks,” “targets,” “believes,” “estimates,” “projects,” “predicts,” “potential” and similar expressions or variations intended to identify forward-looking statements. These statements are based on the beliefs and assumptions of our management based on information currently available to them. Such forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section titled “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2016, and any updates to those risk factors included in Part II, Item 1A of this Quarterly Report on Form 10-Q. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

 

Overview

 

We are a clinical stage biopharmaceutical company with an emphasis on identifying the genetic drivers of disease and applying this understanding to the pursuit of differentiated novel therapies for pediatric onset, life-altering diseases, including rare and orphan diseases. We look to find treatments for genetically defined diseases for which there are limited therapeutic options currently available, with a primary focus on pediatric patients. This strategy begins with identifying and genetically validating a therapeutic target and using genomics to guide product development. The strategy also involves identifying and acquiring otherwise abandoned or overlooked drug candidates and matching targets and mechanisms of action to novel genetic discoveries.

 

We have partnered with the Center for Applied Genomics, or CAG, at The Children’s Hospital of Philadelphia, or CHOP, to implement a genomic medicine driven approach to drug development. CAG’s assets include a fully automated biorepository containing specimens from more than 75,000 pediatric patients and 150,000 relatives of those patients. The sample is highly enriched for rare and orphan diseases and the large majority of patients have been genotyped. Their phenotypes are recorded in a modern electronic health record that is linked to the genomics database and biorepository. The patients in the database have consented to anonymized use of their data for research and follow up contact if needed.

 

CAG continues to discover important and novel genetic biomarkers by both genome-wide association studies and exome sequencing and analysis of affected individuals and their family members. Such markers not only identify patients with the disease but frequently point to the cause of the disease and suggest targets and feasible intervention strategies that include protein or peptide therapy, monoclonal antibodies, drugs or gene therapy. By working initially in pediatric populations of specific diseases, we can minimize the confounding environmental factors seen in older patients. In addition, the availability of robust genetic biomarkers allows us to design trials that focus on a highly-enriched patient population that we believe is more likely to respond to targeted therapies and further enhance the likelihood of clinical and regulatory success. We believe this will allow us to implement more efficient and shorter clinical development programs, that will lead to higher value medicines that can address critical needs in patients suffering from rare and orphan diseases.

  

 -9- 

 

 

AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

AEVI-001 (mGluR+ ADHD and 22q Deletion Syndrome)

 

Our lead program, AEVI-001, is an oral, non-stimulant glutamatergic neuromodulator which completed a Phase 2/3 trial (SAGA) in adolescent Attention Deficit Hyperactivity Disorder, ADHD, patients with specific mutations in their mGluR gene network, which we refer to as mGluR+ ADHD, in the first quarter of 2017. Although in the SAGA trial, AEVI-001 did not meet the primary endpoint of reduction on the ADHD rating scale (ADHD-RS) compared to placebo, the drug did demonstrate statistically significant and clinically meaningful improvement compared to placebo in a pre-specified responder analysis of ADHD-RS improvement of 30% or more [ADHD-RS reduction of 17.6, p < .005]. In a second pre-specified responder analysis of Clinical Global Impression of Improvement scale (CGI-I), a key secondary endpoint, AEVI-001 demonstrated a statistically significant and clinically meaningful improvement compared to placebo [57% of patients treated with AEVI-001 achieved a score of much improved or very much improved compared to 33% on placebo, p=0.0155]. Additionally, the safety analysis demonstrated that AEVI-001 was well tolerated at all doses, and the majority of adverse events were generally mild to moderate in severity. There were no serious adverse events.

 

Subsequent analysis of responder data from a subset of genomically identified patients in the SAGA trial have since identified nine genes that appear to be predictive of clinically meaningful and statistically significant response on the ADHD-RS scales and CGI-I scales. These genes include certain glutamate metabotropic receptors and neurodevelopmental genes that are found in approximately 10% of pediatric ADHD patients.

 

One of the neurodevelopmental genes, contactin-4 (CNTN4), previously identified as being important in Autism Spectrum Disorder (ASD), was highly enriched in the responder population (43%) and represents approximately 5% of the overall pediatric ADHD patient population. The CNTN4 mutation phenotype is relatively severe, with an increased prevalence of emotional dysregulation, which includes issues related to anger control, risk taking, and inappropriate movements and sounds. All (100%) of the CNTN4 mutation positive patients on treatment (n=6) had clinically meaningful and statistically significant response to therapy with AEVI-001 [ADHD-RS reduction of 20.8, p=0.03].

 

Importantly, these results clarify a path forward for the continued development of AEVI-001 in ADHD, as well as in other potential neurodevelopmental disorders, including but not limited to ASD and Pediatric Generalized Anxiety Disorder. We are initiating a Phase 2 trial in CNTN4 mutation positive ADHD (“CNTN4+ ADHD”)(PART A) to confirm genetic responders to AEVI-001. Patient screening is anticipated to begin in the third quarter of 2017 and data is expected by mid-2018.

 

We have completed work on a signal-finding trial for the treatment of the psychiatric symptoms of 22q Deletion Syndrome (22q DS). Enrolling patients into the signal-finding study was challenging, with only two patients enrolled by the time the study ended. Due to the limited enrollment, it is not feasible to meaningfully interpret the resulting data. 22q DS is an orphan, severe autism spectrum disorder with significant co-morbidities. The disease has a prevalence of between 1:2000-1:4000, roughly equivalent with the more recognized Down’s Syndrome.

 

AEVI-002 (Anti-LIGHT Monoclonal Antibody)

 

The second program arising out of our genomic research collaboration with CHOP is the development candidate AEVI-002, a first-in-class anti-LIGHT monoclonal antibody, or the Antibody, being developed for use in Severe Pediatric Onset Crohn’s disease which has a more aggressive phenotype at younger ages. The genomic rationale for the use of the Antibody in Crohn’s disease was validated by CAG research showing the association to a loss of function mutation in decoy receptor 3 (DcR3). The estimated prevalence of the mutation is estimated at 10-15% of pediatric onset Crohn’s disease cases.

 

In June 2016, we entered into a Clinical Development and Option Agreement, or the Development and Option Agreement, with Kyowa Hakko Kirin Co., Ltd., or KHK, pursuant to which we acquired certain rights with respect to the development and potential commercialization of the Antibody. Under the Development and Option Agreement, we received an exclusive option for exclusive rights to develop products containing the Antibody, or an Antibody Licensed Product, exclusive rights to commercialize Antibody Licensed Product in various countries and to conduct various development activities with respect to the Antibody Licensed Product, including the conduct of the Study. The terms of the Development and Option Agreement with KHK are more fully described under the section entitled “Licenses” in Part I, Item 1 of our Annual Report on Form 10-K for the year ended December 31, 2016.

 

An 8-week Phase Ib proof-of-concept study has been initiated at CHOP, with the goal of enrolling up to 12 patients with a pediatric onset Crohn’s disease diagnosis that are refractory to treatment with TNF-α inhibitors, with or without a DcR3 mutation. Active recruitment for the trial is underway. The endpoints of the trial will include endoscopic evaluation, Crohn’s Disease Activity Index ratings and safety. Initial data from the proof-of-concept study is expected around year-end 2017, at which point we will make a determination on our option to license exclusive rights to the Antibody for further development. The identification and recruitment of patients into the proof-of-concept study has been challenging. The ability to produce initial data around year-end 2017 is highly dependent on timely recruiting; thus, continued difficulties in recruitment could cause a delay in the delivery of data for the program.

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

Financial Operations Overview

 

We have generated significant losses to date, and we expect to continue to generate losses as we progress towards the commercialization of our product candidates. We incurred net losses of approximately $18.95 million for the six month period ended June 30, 2017. As of June 30, 2017, we had stockholders’ equity of approximately $17.82 million. As of June 30, 2017, we had cash and cash equivalents of $21.36 million, which we believe will provide funding for our operations into the second quarter of 2018. We are unable to predict the extent of any future losses or when we will become profitable, if at all.

 

Our management has evaluated whether there is substantial doubt about our ability to continue as a going concern and has determined that substantial doubt existed as of the date of this filing. The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities, and commitments in the normal course of business.  The accompanying financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern.  The ability of the Company to continue as a going concern is dependent upon, among other things, raising additional capital. 

 

Since our inception, the Company has obtained funds primarily from the issuance of common stock and convertible securities. If we raise additional funds through strategic collaborations and alliances or licensing arrangements with third parties, which may include existing collaboration partners, we may have to relinquish valuable rights to our technologies or product candidates, including AEVI-001 and AEVI-002, or grant licenses on terms that are not favorable to us. In addition, we anticipate that we will continue to issue equity and/or debt securities as a source of liquidity. There can be no assurance, however, that we will be successful in obtaining such financing in sufficient amounts, on terms acceptable to us, or at all. Any future sales of securities to finance operations will dilute existing stockholders' ownership. We cannot guarantee when or if we will generate positive cash flow. If we are unable to successfully raise sufficient additional capital, through future financings or through strategic and collaborative arrangements, we will not have sufficient cash to fund our ongoing trials and operations.

 

Research and Development Expense

 

Research and development expense consists of: (i) internal costs associated with our development activities; (ii) payments we make to third party contract research organizations, contract manufacturers, clinical trial sites and consultants; (iii) technology and intellectual property license costs; (iv) manufacturing development costs; (v) personnel related expenses, including salaries, and other related costs, including stock-based compensation expense, for the personnel involved in product development; (vi) activities related to regulatory filings and the advancement of our product candidates through preclinical studies and clinical trials; and (vii) facilities and other allocated expenses, which include direct and allocated expenses for rent, facility maintenance, as well as laboratory and other supplies. All research and development costs are expensed as incurred.

 

Conducting a significant amount of development is central to our business model. Product candidates in later-stage clinical development generally have higher development costs than those in earlier stages of development, primarily due to the significantly increased size and duration of the clinical trials. Research and development expenses will likely increase as we advance the development of AEVI-001 and AEVI-002 and look to advance our earlier-stage research and development projects.

 

The process of conducting pre-clinical studies and clinical trials necessary to obtain regulatory approval is costly and time consuming. The probability of success for each product candidate and clinical trial may be affected by a variety of factors, including, among others, the quality of the product candidate’s early clinical data, investment in the program, competition, manufacturing capabilities and commercial viability. As a result of these uncertainties, together with the uncertainty associated with clinical trial enrollments and the risks inherent in the development process, we are unable to determine the duration and completion costs of current or future clinical stages of our product candidates or when, or to what extent, we will generate revenues from the commercialization and sale of any of our product candidates. Development timelines, probability of success and development costs vary widely. We are concurrently focusing on the development and potential commercialization of AEVI-002 under the Development and Option Agreement with KHK, advancing the development of AEVI-001 and advancing our earlier-stage research and development projects.

 

Research and development expenses are shown net of participation by third parties.

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

General and Administrative Expense

 

General and administrative expense consists primarily of salaries and other related costs, including stock-based compensation expense, for persons serving as our directors and in our executive, finance and accounting functions. Other general and administrative expense includes facility-related costs not otherwise included in research and development expense, costs associated with industry and trade shows, and professional fees for legal services and accounting services.

 

Results of Operations for the Six Months Ended June 30, 2017 and 2016

 

Research and Development Expenses

 

Research and development expenses for the six months ended June 30, 2017 were $13.61 million decreasing from $15.69 million for the same period in 2016 mainly due to decreased costs associated with the TARGT technology and the closure of the Company’s operations in Israel.

 

General and Administrative Expenses

 

General and administrative expenses for the six months ended June 30, 2017 were $5.36 million, decreasing from $7.14 million for the same period in 2016 primarily due to severance benefits recorded in 2016 related to the termination of an officer of the Company and decrease of stock-based compensation expense related to options which have fully vested.

 

Financial Income and Expenses

 

Financial income and expense for the six months ended June 30, 2017 and 2016 were de minimis.

 

Results of Operations for the Three Months Ended June 30, 2017 and 2016

 

Research and Development Expenses

 

Research and development expenses for the three months ended June 30, 2017 were $5.67 million decreasing from $8.74 million for the same period in 2016 mainly related to decreased spend associated with the AEVI-001 program following conclusion of the SAGA trial.

 

General and Administrative Expenses

 

General and administrative expenses for the three months ended June 30, 2017 were $2.37 million, decreasing from $2.95 million for the same period in 2016 mainly due to decreased costs associated with the closure of the Company’s operations in Israel.

 

Financial Income and Expenses

 

Financial income and expense for the three months ended June 30, 2017 and 2016 were de minimis.

 

Liquidity and Capital Resources

 

Sources of Liquidity

 

We have financed our operations primarily through issuance of equity.

 

Cash Flows

 

We had cash and cash equivalents of $21.36 million at June 30, 2017 and $39.84 million at December 31, 2016. The decrease in our cash balance during the six months ended June 30, 2017 was primarily related to funding operations and advancing our AEVI-001 program.

 

Net cash used in operating activities of $18.50 million for the six months ended June 30, 2017 and $18.94 million for the six months ended June 30, 2016 primarily reflected our cash expenses for our operations.

 

Net cash used in investing activities for the six months ended June 30, 2017 and 2016 were de minimis.

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

Net cash provided by financing activities for the six months ended June 30, 2017 was de minimis compared to $19.75 million for the six months ended June 30, 2016 related to the completion of a registered public offering.

 

Funding Requirements

 

Our future capital requirements will depend on a number of factors, including our success in targeting rare and orphan disease candidates, the timing and outcome of clinical trials and regulatory approvals, the costs involved in preparing, filing, prosecuting, maintaining, defending, and enforcing patent claims and other intellectual property rights, the acquisition of licenses to new products or compounds, the status of competitive products, the availability of financing, and our success in developing markets for our product candidates.

 

Without taking into account any revenue we may receive as a result of licensing or other commercialization agreements we may enter into, we believe that cash on hand will be sufficient to enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2018. We have based this estimate on assumptions that may prove to be wrong, and we could use our available resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures associated with our current and anticipated clinical trials.

 

We do not anticipate that we will generate revenue from the sale of products for several years or more given the uncertainty of drug development. In the absence of additional funding or adequate funding from licensing or commercialization agreements, we expect our continuing operating losses to result in decreases in our cash balances. Absent significant corporate collaboration and licensing arrangements, we will need to finance our future cash needs through public or private equity offerings or debt financings. We do not currently have any commitments for future external funding. We may need to raise additional funds more quickly if one or more of our assumptions prove to be incorrect or if we choose to expand our product development efforts more rapidly than we presently anticipate, and we may decide to raise additional funds even before we need them if the conditions for raising capital are favorable. We may seek to encourage holders of our warrants to exercise, sell additional equity or debt securities or obtain a bank credit facility. The sale of additional equity or debt securities, if convertible, could result in dilution to our stockholders. The incurrence of indebtedness would result in increased fixed obligations and could also result in covenants that would restrict our operations. If we are unable to successfully raise sufficient additional capital, through future financings or through strategic and collaborative arrangements, we will not have sufficient cash to fund our additional clinical trials and operations.

 

Our plans include seeking additional investments and commercial agreements to continue our operations. However, there is no assurance that we will be successful in our efforts to raise the necessary capital and/or reach such commercial agreements to continue our planned research and development activities.

 

Our management has evaluated whether there is substantial doubt about the our ability to continue as a going concern and has determined that substantial doubt existed as of the date of this filing. This determination was based on the following factors: (i) our available cash as of the date of this filing will only be sufficient to fund our anticipated level of operations into the second calendar quarter of 2018; (ii) we may not identify additional strategic collaboration or alliance partners with whom we can partner to support development of our drug candidates; (iii) we will require additional financing for the second half of 2018 to continue at our expected level of operations beyond the second quarter of 2018; and (iv) if we fail to obtain the needed capital, we will be forced to delay, scale back, or eliminate some or all of our research and development programs or perhaps cease operations. In the opinion of management, these factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern.

 

If we fail to obtain the needed capital, we will be forced to delay, scale back, sell or out-license or eliminate some or all of our research and development programs. There is no assurance that we will be successful in any capital-raising efforts that we may undertake to fund operations. We are exploring various sources of funding for continued development of AEVI-001 and AEVI-002, as well as our ongoing operations. If we raise additional funds through strategic collaborations and alliances or licensing arrangements with third parties, which may include existing collaboration partners, we may have to relinquish valuable rights to our technologies or product candidates, including AEVI-001 and AEVI-002, or grant licenses on terms that are not favorable to us. In addition, we anticipate that we will continue to issue equity and/or debt securities as a source of liquidity, until we begin to generate positive cash flow to support our operations. Any future sales of securities to finance operations will dilute existing stockholders’ ownership. We cannot guarantee when or if we will generate positive cash flow.

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

Critical Accounting Policies

 

Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses. On an ongoing basis, we evaluate these estimates and judgments, including those described below. We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the circumstances. These estimates and assumptions form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results and experiences may differ materially from these estimates.

 

While our significant accounting policies are more fully described in Note 2 to our financial statements included elsewhere in this Quarterly Report on Form 10-Q, we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating our reported financial results and affect the more significant judgments and estimates that we use in the preparation of our financial statements.

 

Stock-Based Compensation

 

We account for stock options granted to employees and directors according to the Accounting Standards Codification No. 718 (ASC 718) “Compensation – Stock Compensation.” Under ASC 718, stock-based compensation cost is measured at grant date, based on the estimated fair value of the award, and is recognized as an expense over the requisite service period on a straight-line basis.

 

For the purpose of valuing options granted to our employees and directors during the six months ended June 30, 2017 and 2016, we used the Binomial options pricing model. To determine the risk-free interest rate, we utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the contractual life of our awards. We estimated the expected life of the options granted based on anticipated exercises in the future periods assuming the success of our business model as currently forecast. The expected dividend yield reflects our current and expected future policy for dividends on our common stock. The expected stock price volatility for our stock options was calculated by examining historical volatilities for publicly traded industry peers and blending in our historical volatility. We will continue to analyze the expected stock price volatility as more historical data for our common stock becomes available. After adoption of ASU 2016-09 in the first quarter of 2017, we recognize forfeitures as they occur.

 

Off-Balance Sheet Arrangements

 

CHOP License Agreement and Research Agreement

 

In November 2014, we entered into a license agreement, or the License Agreement, and a sponsored research agreement, or the Research Agreement, each with CHOP. Under the terms of the License Agreement, CHOP granted us (i) an exclusive, sublicensable license to use certain patent rights covering potential diagnostic and therapeutic targets, (ii) an exclusive, non-sublicensable license to use certain biospecimen and phenotypic data collected from patients with rare and orphan diseases and their family members or the Biobank. In February 2017, we amended the License Agreement. The amendment allows us to extend the period of our exclusive commercial access to the Biobank for rolling two year periods. The cost of each extension is $125,000 per year. In June 2017, we entered into an amendment to the Research Agreement, which extended the Research Agreement through June 30, 2019, for which additional payments totaling $5.94 million will be due in 2018 and $2.38 million will be due in 2019. The amendment also allows us to extend the Research Agreement for rolling two year periods in connection with the Company extending its exclusive commercial access to the Biobank under the License Agreement.

 

ITEM 3. - Quantitative and Qualitative Disclosures about Market Risk

 

There has been no significant change in our exposure to market risk during the six months ended June 30, 2017. For a discussion of our exposure to market risk, refer to Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” contained in our Annual Report on Form 10-K for the year ended December 31, 2016.

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

ITEM 4. - Controls and Procedures

 

Evaluation of disclosure controls and procedures

 

As required by Rule 13a-15(b) of the Exchange Act, in connection with the filing of this Quarterly Report on Form 10-Q, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of June 30, 2017, the end of the period covered by this report.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting during the second quarter of 2017, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, 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

 

We are not currently a party, as plaintiff or defendant, to any legal proceedings which, individually or in the aggregate, are expected by us to have a material effect on our business, financial condition or results of operation if determined adversely to us.

 

ITEM 1A - Risk Factors

 

The discussion of our business and operations should be read together with the risk factors contained in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2016 which describe various risks and uncertainties to which we are or may become subject. These risks and uncertainties have the potential to affect our business, financial condition, results of operations, cash flows, strategies or prospects in a material and adverse manner. Except as disclosed below, there have been no material changes to the risk factors set forth in the above-referenced filing as of June 30, 2017.

 

Business-Related Risks

 

Our recurring losses from operations raise substantial doubt regarding our ability to continue as a going concern.

 

     Our recurring losses from operations raise substantial doubt about our ability to continue as a going concern. There is no assurance that sufficient financing will be available when needed to allow us to continue as a going concern. The perception that we may not be able to continue as a going concern may cause others to choose not to deal with us due to concerns about our ability to meet our contractual obligations.

 

We will need substantial additional capital for the continued development of our product candidates and for our long-term operations.

 

As of June 30, 2017, our cash and cash equivalents were approximately $21.36 million. We believe our existing cash and cash equivalents will provide funding for our current operating and capital requirements into the second quarter of 2018. However, changes in our business, whether or not initiated by us, may affect the rate at which we deplete our cash and cash equivalents. Our present and future capital requirements depend on many factors, including:

 

·the rate and level of patient recruitment into our clinical trials, particularly those in Phase 2 and Phase 3 stages of development, including those trials for which we are currently recruiting; (for example, the identification and recruitment of patients into the AEVI-002 proof-of-concept study has been challenging. The ability to produce initial data in the second half of 2017 is highly dependent on timely recruiting; thus, continued difficulties in recruitment could cause a delay in the delivery of data for the program, and potentially result in increased costs to complete the study);

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

·the level of research and development investment required to develop our product candidates;

 

·changes in product development plans needed to address any difficulties that may arise in manufacturing, pre-clinical activities, clinical trials or commercialization;

 

·our ability and willingness to enter into new agreements with strategic partners and the terms of these agreements;

 

·our success rate in pre-clinical and clinical efforts;

 

·the costs of future commercialization activities, including product sales, marketing, manufacturing and distribution, for any of our product candidates for which we receive marketing approval;

 

·revenue, if any, received from commercial sales of our product candidates, if any of our product candidates receive marketing approval;

 

·costs of recruiting and retaining qualified personnel;

 

·the timing and amount of milestone payments we are required to make under our license agreements;

 

·time and costs involved in obtaining regulatory approvals; and

 

·costs of filing, prosecuting, defending, and enforcing patent claims and other intellectual property rights.

 

We will require significant amounts of additional capital in the future, and such capital may not be available when we need it on terms that we find favorable, if at all. Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete. We may never progress to the point where we have commercially successful product sales which generate sufficient commercial revenue or such revenue may not be achieved for many years. Accordingly, we may seek to raise these funds through public or private equity offerings, debt financings, credit facilities, or partnering or other corporate collaborations and licensing arrangements. If adequate funds are not available or are not available on acceptable terms, our ability to fund our operations, take advantage of opportunities, develop products and technologies, and otherwise respond to competitive pressures could be significantly delayed or limited, and we may need to downsize or halt our operations.

 

ITEM 2. - Unregistered Sales of Equity Securities and Use of Proceeds

 

Recent Sales of Unregistered Securities

 

None

 

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

 

None

 

ITEM 3. - Defaults Upon Senior Securities

 

None

 

ITEM 4. - Mine Safety Disclosures

 

Not applicable

 

ITEM 5. - Other Information

 

None

 

ITEM 6. – Exhibits

 

Exhibit No.   Description
     
31.1   Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
31.2   Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
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 (furnished herewith).
101   Interactive Data File (filed herewith).

 

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AEVI GENOMIC MEDICINE, INC. AND ITS SUBSIDIARY 

 

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.

 

Date: August 9, 2017 AEVI GENOMIC MEDICINE, INC.
     
  By: /s/ Michael F. Cola
    Michael F. Cola
    President and Chief Executive Officer
    (Principal Executive Officer)
     
Date: August 9, 2017 By: /s/ Brian D. Piper
    Brian D. Piper
    Chief Financial Officer and Corporate Secretary
    (Principal Financial Officer)

 

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