VIA Pharmaceuticals Inc. (VIAP) filed Quarterly Report for the period ended 2009-09-30.
GenStar Therapeutics is a biopharmaceutical company developing innovative gene therapy products for the treatment of serious medical disorders. The Company's research and development efforts, utilizing advanced gene delivery technologies, are focused on hemophilia, cancer and vaccines. Via Pharmaceuticals Inc. has a market cap of $8 million; its shares were traded at around $0.385 with and P/S ratio of 95.7.
Highlight of Business Operations:
Until the Company can establish profitable operations to finance its cash requirements, the Company’s ability to meet its obligations in the ordinary course of business is dependent upon its ability to raise substantial additional capital through public or private equity or debt financings, the establishment of credit or other funding facilities, collaborative or other strategic arrangements with corporate sources or other sources of financing, the availability of which cannot be assured. The Company raised $11.1 million through a merger (the “Merger”) with Corautus Genetics Inc. (“Corautus”) that was consummated on June 5, 2007, to cover existing obligations and provide operating cash flows. On June 29, 2007, the Company entered into a securities purchase agreement that provided for issuance of 10,288,065 shares of common stock for approximately $25.0 million in gross proceeds. As of September 30, 2009, the Company had $4.6 million in cash on hand. As more fully described in Note 6 in the notes to the unaudited condensed financial statements, in March 2009, the Company entered into a Note and Warrant Purchase Agreement (the “Loan Agreement”) with its principal stockholder and one of its affiliates (the “Lenders”) whereby the Lenders agreed to lend to the Company in the aggregate up to $10.0 million. The Company secured the loan with all of its assets, including the Company’s intellectual property. On March 12, 2009, the Company borrowed the initial $2.0 million available under the Loan Agreement. On May 19, 2009, June 29, 2009, and August 14, 2009, the Company made additional $2.0 million borrowings under the Loan Agreement, and on September 11, 2009, the Company borrowed the final $2.0 million available under the Loan Agreement. According to the terms of the original Loan Agreement, the debt was due to the Lenders on September 14, 2009. On September 11, 2009, the Lenders agreed to modify the Loan Agreement to extend the repayment terms to October 31, 2009, and, as more fully described in Note 12 in the notes to the unaudited condensed financial statements, on October 30, 2009, the Lenders agreed to modify the Loan Agreement to further extend the repayment terms to December 31, 2009. The Lenders did not modify the interest rate or offer any concessions in the amended Loan Agreement. Management believes that the $4.6 million of cash on hand at September 30, 2009 is sufficient to enable the Company, under normal continuing operations, to meet its current operating cash requirements into January 2010. Management does not believe that existing cash resources will be sufficient to enable the Company to meet its ongoing working capital requirements for the next twelve months and the Company will need to raise substantial additional funding in the near term to repay amounts owed under this loan, which are due December 31, 2009, and to meet its working capital requirements. As a result, there are substantial doubts that the Company will be able to continue as a going concern and, therefore, may be unable to realize its assets and discharge its liabilities in the normal course of business. The unaudited condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or to amounts and classifications of liabilities that may be necessary should the entity be unable to continue as a going concern.
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