| Business and Basis of Presentation | 6 Months Ended |
| Jun. 30, 2014 |
| Business and Basis of Presentation | ' |
| Business and Basis of Presentation | ' |
| 1. Business and Basis of Presentation |
|
| Business |
|
| GTx, Inc. (“GTx” or the “Company”), a Delaware corporation incorporated on September 24, 1997 and headquartered in Memphis, Tennessee, is a biopharmaceutical company dedicated to the discovery, development and commercialization of small molecules for the treatment of cancer, including treatments for breast and prostate cancer, cancer supportive care, including prevention and treatment of cancer-related muscle wasting, and other serious medical conditions. |
|
| The Company is developing selective androgen receptor modulators (“SARMs”), including its lead product candidate, enobosarm (GTx-024). SARMs are a new class of drugs with the potential to be used as a novel hormonal therapy for the treatment of metastatic breast cancer, as well as the potential to prevent and treat muscle wasting in patients with cancer and other musculoskeletal wasting or muscle loss conditions, including chronic sarcopenia (age related muscle loss). The Company announced during the second quarter of 2014 positive preliminary results from a Phase 2 proof-of-concept, open-label clinical trial evaluating enobosarm 9 mg for the treatment of patients with androgen receptor (“AR”) positive and estrogen receptor (“ER”) positive metastatic breast cancer who have previously responded to hormonal therapy. Based on the results of this clinical trial, the Company plans to advance clinical development of enobosarm 9 mg in patients with AR positive metastatic breast cancer, subject to the Company’s ability to obtain additional funding. |
|
| The Company announced in August 2013 that its POWER 1 (platinum plus taxane chemotherapy) and POWER 2 (platinum plus non-taxane chemotherapy) Phase 3 clinical trials evaluating enobosarm 3 mg for the prevention and treatment of muscle wasting in patients with advanced non-small cell lung cancer (“NSCLC”) failed to meet the primary statistical criterion for the co-primary endpoints of lean body mass and physical function that were assessed statistically using responder analyses as pre-specified for the United States Food and Drug Administration (“FDA”). The Company met with representatives from two member countries to the European Medicines Agency (“EMA”) in January 2014 to review and discuss the results of the POWER trials to determine an appropriate path forward for submitting a marketing authorization application (“MAA”) in the European Union (“EU”) for enobosarm 3 mg for the prevention and treatment of muscle wasting in patients with advanced NSCLC. Following these meetings, the Company retained experts in both the U.S. and the EU to work with the Company’s internal team to explore the option of submitting a MAA for enobosarm 3 mg in the more narrow indication of the prevention and treatment of muscle wasting in patients with advanced NSCLC treated with platinum plus taxane chemotherapy. The Company has completed the clinical conduct for all additional Phase 1 clinical studies typically required for submission purposes and is now reviewing the pharmacokinetic and safety data necessary to prepare the related clinical study reports. Further, the Company has submitted a pediatric investigational plan to the EMA, which is necessary for the submission of a MAA. Although the Company has performed these prerequisite activities for the submission of a MAA for enobosarm 3 mg for the prevention and treatment of muscle wasting in patients with advanced NSCLC treated with platinum plus taxane chemotherapy, the Company is continuing to evaluate the filing of a MAA to the EMA based on the sufficiency of the supporting data and the commercial prospects of the drug candidate in this more narrow indication. In any event, the Company does not currently expect that it will be able to submit a MAA to the EMA prior to the third quarter of 2015, if at all. |
|
| In the Company’s meeting with the FDA in February 2014 to review and discuss the results of the POWER clinical trials, the Company learned that since data from the two POWER trials failed to meet the primary statistical criterion pre-specified for the co-primary endpoints of lean body mass and physical function, the FDA was not willing to accept a new drug application (“NDA”) for enobosarm 3 mg. The Company is evaluating options for further development of enobosarm 3 mg. Any further development of enobosarm 3 mg would be subject to the Company’s ability to obtain additional funding. |
|
| Additionally, the Company is developing GTx-758 (Capesaris®), an oral nonsteroidal selective estrogen receptor alpha agonist, for secondary hormonal therapy in men with castration resistant prostate cancer, and, potentially, as a secondary hormonal treatment for advanced prostate cancer used in combination with androgen deprivation therapy. The Company is presently conducting a Phase 2 clinical trial evaluating GTx-758 as secondary hormonal therapy in men with metastatic and non-metastatic castration resistant prostate cancer. |
|
| In April 2014, the Company announced that Mitchell S. Steiner, its Chief Executive Officer (“CEO”), Vice Chairman of the Board of Directors and a co-founder of the Company, was leaving the Company to pursue other business interests. Dr. Steiner resigned from his roles as CEO and Vice Chairman of the Board of Directors at the Company effective April 3, 2014. In connection with Dr. Steiner’s resignation, Marc S. Hanover was appointed as the Company’s interim Chief Executive Officer and was elected to the Board to serve the remainder of Dr. Steiner’s term on the Board until the 2015 annual meeting of the Company’s stockholders. Also in connection with Dr. Steiner’s resignation, the Company entered into a severance agreement with Dr. Steiner, pursuant to which Dr. Steiner received severance benefits of twelve months of base salary continuation payments and continued healthcare coverage through the earliest of December 31, 2014 or the date he ceases to be eligible for COBRA continuation coverage. As a result of these severance benefits, the Company recognized cash severance related expenses of $483 during the three months ended June 30, 2014. Additionally, all of Dr. Steiner’s outstanding unvested stock options were vested and became immediately exercisable on April 13, 2014. The Company extended the post-termination exercise period of all of his stock options until the earlier to occur of (i) April 13, 2019 or (ii) the expiration of the term of a particular stock option grant. The Company recorded a one-time, noncash net compensation expense of $215 relating to these stock option modifications. See Note 2, Share-Based Compensation, for further information. |
|
| The Company has experienced significant recurring operating losses since its inception and has limited funds. The Company estimates that its current cash, cash equivalents and short-term investments, together with interest thereon, will be sufficient to meet its projected operating requirements into the second quarter of 2015. Accordingly, the Company needs to raise substantial additional capital in the near term in order to fund its operations through and beyond the second quarter of 2015 and to continue as a going concern. |
|
| Basis of Presentation |
|
| The accompanying unaudited condensed financial statements reflect, in the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of GTx’s financial position, results of operations and cash flows for each period presented in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted from the accompanying condensed financial statements. These interim condensed financial statements should be read in conjunction with the audited financial statements and related notes thereto, which are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. Operating results for the three and six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the entire fiscal year ending December 31, 2014. |
|
| Use of Estimates |
|
| The preparation of condensed financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the condensed financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual amounts and results could differ from those estimates. |
|
| Research and Development Expenses |
|
| Research and development expenses include, but are not limited to, the Company’s expenses for personnel, supplies, and facilities associated with research activities, screening and identification of product candidates, formulation and synthesis activities, manufacturing, preclinical studies, toxicology studies, clinical trials, regulatory and medical affairs activities, quality assurance activities and license fees. The Company expenses these costs in the period in which they are incurred. The Company estimates its liabilities for research and development expenses in order to match the recognition of expenses to the period in which the actual services are received. As such, accrued liabilities related to third party research and development activities are recognized based upon the Company’s estimate of services received and degree of completion of the services in accordance with the specific third party contract. As a result of the October 2013 reduction in its workforce, the Company is no longer conducting drug discovery activities and is focusing its research and development activities on the ongoing clinical development of the Company’s current product candidates. |
|
| Cash, Cash Equivalents and Short-term Investments |
|
| The Company considers highly liquid investments with initial maturities of three months or less to be cash equivalents. |
|
| At June 30, 2014 and December 31, 2013, short-term investments consisted of Federal Deposit Insurance Corporation insured certificates of deposit with original maturities of greater than three months and less than one year. As the Company has the positive intent and ability to hold the certificates of deposit until maturity, these investments have been classified as held to maturity investments and are stated at cost, which approximates fair value. The Company considers these to be Level 2 investments as the fair values of these investments are determined using third-party pricing sources, which generally utilize observable inputs, such as interest rates and maturities of similar assets. |
|
| Income Taxes |
|
| The Company accounts for deferred taxes by recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Accordingly, at June 30, 2014 and December 31, 2013, net of the valuation allowance, the net deferred tax assets were reduced to zero. Income taxes are described more fully in Note 9 to the Company’s financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. |
|
| Other Income, net |
|
| Other income, net consists of foreign currency transaction gains and losses associated with conducting clinical trials in foreign countries, interest earned on the Company’s cash, cash equivalents and short-term investments, interest expense, and other non-operating income or expense. |
|
| FARESTON® Revenue Recognition |
|
| Although the Company sold its rights and certain assets related to FARESTON® effective September 30, 2012, the Company retained the liability for future product returns relating to sales of FARESTON® made by the Company prior to September 30, 2012. Therefore, the Company estimates an accrual for product returns based on factors which include historical product returns and estimated product in the distribution channel which is expected to exceed its expiration date. At June 30, 2014 and December 31, 2013, the Company’s accrual for product returns, was $282 and $918, respectively. Of these amounts, $147 and $332 have been included in “Other long-term liabilities” in the condensed balance sheet at June 30, 2014 and December 31, 2013, respectively, and represents the portion of the Company’s product returns accrual estimated to be payable after one year. |
|
| Subsequent Events |
|
| The Company has evaluated all events or transactions that occurred after June 30, 2014 up through the date the condensed financial statements were issued. There were no material recognizable or nonrecognizable subsequent events during the period evaluated. |
|
| Going Concern |
|
| The accompanying unaudited condensed financial statements have been prepared assuming the Company will continue as a going concern which contemplates the realization of assets and liabilities in the ordinary course of business. The Company has experienced significant recurring operating losses since its inception resulting in an accumulated deficit of $475,291 at June 30, 2014. At June 30, 2014, the Company had cash, cash equivalents and short-term investments of $17,258 compared to $14,729 at December 31, 2013. Currently, the Company has no ongoing collaborations for the development and commercialization of its product candidates and no source of revenue, nor does the Company expect to generate revenue for the foreseeable future. A substantial portion of the Company’s efforts and expenditures has been devoted to enobosarm 3 mg, which was the subject of two Phase 3 clinical trials for the prevention and treatment of muscle wasting in patients with advanced NSCLC, and the Company has been substantially dependent on the successful development, regulatory approval and commercialization of enobosarm 3 mg. The failure of the enobosarm 3 mg Phase 3 clinical trials to meet the primary statistical criterion for the co-primary endpoints agreed upon with the FDA has significantly depressed the Company’s stock price and has harmed its future prospects and ability to raise additional capital, and consequently, the Company’s prospects as a going concern have been diminished. The Company estimates that its current cash, cash equivalents and short-term investments, together with interest thereon, will be sufficient to meet its projected operating requirements only into the second quarter of 2015. If the Company does not have sufficient funds to continue its operations, it would be required to, among other things, make further reductions in its workforce, eliminate ongoing clinical trials, discontinue the development of enobosarm and/or GTx-758, liquidate all or a portion of its assets, and/or seek protection under the provisions of the U.S. Bankruptcy Code. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s financial statements do not include any adjustments that may result from the outcome of this uncertainty. |
|
