fencf-20210630x10q.htm

Exhibit 31.1

FENNEC PHARMACEUTICALS INC

CERTIFICATION

I, Rostislav Raykov, certify that:


1.	I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2021 of Fennec Pharmaceuticals Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the unaudited interim condensed consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
		(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its condensed subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
		(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
		(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
		(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
		(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
		(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 10, 2021

	By:	/s/ Rostislav Raykov
		Rostislav Raykov
		Chief Executive Officer

Exhibit 31.2

FENNEC PHARMACEUTICALS INC.

CERTIFICATION

I, Robert Andrade, certify that:

0
	1.	I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2021 of Fennec Pharmaceuticals Inc.;
	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
	3.	Based on my knowledge, the unaudited interim condensed consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
	4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
			(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its condensed subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
			(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
			(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
			(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
	5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
			(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
			(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 10, 2021

	By:	/s/ Robert Andrade
		Robert Andrade
		Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Fennec Pharmaceuticals Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2021 (the “Report”), each of the undersigned, Rostislav Raykov, Chief Executive Officer of the Company, and Robert Andrade, Chief Financial Officer of the Company, hereby certifies pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

	1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 10, 2021

	By:	/s/ Rostislav Raykov
		Rostislav Raykov
		Chief Executive Officer

Date: August 10, 2021

	By:	/s/ Robert Andrade
		Robert Andrade
		Chief Financial Officer

Exhibit 99.1

FENNEC PHARMACEUTICALS ANNOUNCES SECOND QUARTER 2021

FINANCIAL RESULTS AND PROVIDES BUSINESS UPDATE

~ FDA Prescription Drug User Fee Act (PDUFA) Target Action Date Set for November 27, 2021 ~

~ If Approved by the FDA, PEDMARK^TM Stands to Be the First Therapy for the Prevention of Cisplatin-Induced Hearing Loss in Children ~

~ Company Has Approximately $27 Million in Cash and Cash Equivalents ~

Research Triangle Park, NC, August 10, 2021 – Fennec Pharmaceuticals Inc. (NASDAQ:FENC; TSX: FRX), a specialty pharmaceutical company focused on the development of PEDMARK^TM (a unique formulation of sodium thiosulfate) for the prevention of platinum-induced ototoxicity in pediatric patients, today reported its financial results for the second quarter ended June 30, 2021 and provided a business update.

“We are pleased that the FDA has accepted our PEDMARK^TMNDA resubmission, and as we work closely with the Agency through the review process, we are also focusing on essential activities in preparation to bring this important treatment to children receiving cisplatin chemotherapy,” said Rosty Raykov, chief executive officer of Fennec Pharmaceuticals, Inc.

Upcoming Investor Event

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2021 Wedbush PacGrow Healthcare Conference – The Company will be presenting on Wednesday, August 11, 2021 at 4:40 p.m. ET. The presentation will be webcast live and can be accessed by visiting the investors relations section of the Company’s website at http://investors.fennecpharma.com/events-and-presentations/presentations.

Financial Results for the Second Quarter 2021

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Cash Position – Cash and cash equivalents were $27.3 million as of June 30, 2021. The decrease in cash and cash equivalents between June 30, 2021 and December 31, 2020, is the result of expenses related to the development and preparation of our New Drug Application (NDA) resubmission of PEDMARK^TM and general and administrative expenses, which were offset by the $5.0 million draw on the Bridge Bank Loan in June 2021. As of June 30, 2021, the Company had $5.0 million in funded debt.

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Research and Development (R&D) Expenses – R&D expenses were $0.8 million for the second quarter ended June 30, 2021 compared to $1.1 million for the same period in 2020. R&D expenses decreased by $0.3 million for the three months ended June 30, 2021 over the same period in 2020 as the Company’s development activities shifted back to essential activities in preparation for the launch of PEDMARK^TM.

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General and Administrative (G&A) Expenses – G&A expenses decreased by $0.6 million over same period in 2020 with the decrease mainly driven by a lower level of pre-commercialization activities on a year-over-year basis offset by higher expenses associated with additional employees and contract staff, and the increase in non-cash equity remuneration expense related to the vesting of new and existing grants.

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Net Loss – Net loss for the quarter ended June 30, 2021 was $4.0 million ($0.15 per share), compared to $4.8 million ($0.21 per share) for the same period in 2020.

Financial Update

The selected financial data presented below is derived from our unaudited condensed consolidated financial statements, which were prepared in accordance with U.S. generally accepted accounting principles. The complete unaudited condensed consolidated financial statements for the period ended June 30, 2021 and management's discussion and analysis of financial

condition and results of operations will be available via www.sec.gov and www.sedar.com. All values are presented in thousands unless otherwise noted.

Unaudited Condensed Consolidated

Statements of Operations:

(U.S. Dollars in thousands except per share amounts)


	Three Months Ended
	June 30,		June 30,
	2021		2020

Revenue	$	—	$	—

Operating expenses:
Research and development		800		1,121
General and administrative		3,120		3,724

Loss from operations		(3,920)		(4,845)

Other (expense)/income
Unrealized loss on securities		(84)		—
Amortization expense		—		(30)
Other (loss)/gain		(9)		13
Net interest income		12		17
Total other income, net		(81)		—

Net (loss)	$	(4,001)	$	(4,845)

Basic net (loss) per common share	$	(0.15)	$	(0.21)

Diluted net (loss) per common share	$	(0.15)	$	(0.21)

Fennec Pharmaceuticals Inc.

Balance Sheets

(U.S. Dollars in thousands)


	June 30, 2021		December 31,
	(Unaudited)		2020

Assets
Current assets
Cash and cash equivalents	$	27,293	$	30,344
Prepaid expenses		409		797
Other current assets		372		276
Total current assets		28,074		31,417
Non-Current assets
Deferred issuance cost		507		466
Deferred issuance cost (amortization)		(466)		(466)
Total non-current assets		41		—
Total assets	$	28,115	$	31,417

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	677	$	1,571
Accrued liabilities		171		776
Total current liabilities		848		2,347
Long term liabilities
Term loan		5,000		—
Debt discount		(14)		—
Total long term liabilities		4,986		—
Total liabilities		5,834		2,347

Shareholders’ equity:
Common stock, no par value; unlimited shares authorized; 26,007 shares issued and outstanding (2020 -26,003)		140,780		140,733
Additional paid-in capital		51,132		49,234
Accumulated deficit		(170,874)		(162,140)
Accumulated other comprehensive income		1,243		1,243
Total shareholders’ equity		22,281		29,070
Total liabilities and shareholders’ equity	$	28,115	$	31,417

Working Capital


	Fiscal Year Ended
Selected Asset and Liability Data:	June 30, 2021		December 31, 2020
(U.S. Dollars in thousands)
Cash and cash equivalents	$	27,293	$	30,344
Other current assets		781		1,073
Current liabilities		(848)		(2,347)
Working capital	$	27,226	$	29,070

Selected Equity:
Common stock & APIC	$	191,912	$	189,967
Accumulated deficit		(170,874)		(162,140)
Stockholders’ equity		22,281		29,070

About PEDMARK™

Cisplatin and other platinum compounds are essential chemotherapeutic agents for many pediatric malignancies. Unfortunately, platinum-based therapies cause ototoxicity, or hearing loss, which is permanent, irreversible and particularly harmful to the survivors of pediatric cancer.

In the U.S. and Europe, it is estimated that, annually, over 10,000 children may receive platinum-based chemotherapy. The incidence of ototoxicity depends upon the dose and duration of chemotherapy, and many of these children require lifelong hearing aids. There is currently no established preventive agent for this hearing loss and only expensive, technically difficult and sub-optimal cochlear (inner ear) implants have been shown to provide some benefit. Infants and young children that suffer ototoxicity at critical stages of development lack speech language development and literacy, and older children and adolescents lack social-emotional development and educational achievement.

PEDMARK has been studied by cooperative groups in two Phase 3 clinical studies of survival and reduction of ototoxicity, The Clinical Oncology Group Protocol ACCL0431 and SIOPEL 6. Both studies have been completed. The COG ACCL0431 protocol enrolled childhood cancers typically treated with intensive cisplatin therapy for localized and disseminated disease, including newly diagnosed hepatoblastoma, germ cell tumor, osteosarcoma, neuroblastoma, and medulloblastoma. SIOPEL 6 enrolled only hepatoblastoma patients with localized tumors.

The FDA has accepted for filing the Company’s New Drug Application (NDA) for PEDMARK™ and has granted Priority Review. PEDMARK has received Breakthrough Therapy and Fast Track Designation by the FDA in March 2018, and a Prescription Drug User Fee Act (PDUFA) Target Action Date of November 27, 2021. The Marketing Authorization Application (MAA) for sodium thiosulfate (tradename PEDMARQSI) is currently under evaluation by the European Medicines Agency (EMA).

About Fennec Pharmaceuticals

Fennec Pharmaceuticals Inc. is a specialty pharmaceutical company focused on the development of PEDMARK™ for the prevention of platinum-induced ototoxicity in pediatric patients. Further, PEDMARK has received Orphan Drug Designation in the U.S. for this potential use. Fennec has a license agreement with Oregon Health and Science University (OHSU) for exclusive worldwide license rights to intellectual property directed to sodium thiosulfate and its use for chemoprotection, including the prevention of ototoxicity induced by platinum chemotherapy, in humans. For more information, please visit www.fennecpharma.com

Forward Looking Statements

Except for historical information described in this press release, all other statements are forward-looking. Words such as “believe,” “anticipate,” “plan,” “expect,” “estimate,” “intend,” “may,” “will,” or the negative of those terms, and similar expressions, are intended to identify forward-looking statements. These forward-looking statements include the

Company’s expectations regarding its interactions and communications with the FDA, including the Company’s expectations and goals respecting the NDA resubmission for PEDMARK^TM. Obtaining Fast Track Designation and Breakthrough Therapy Designation by the FDA is no guarantee that the FDA will approve the NDA resubmission of PEDMARK. Forward-looking statements are subject to certain risks and uncertainties inherent in the Company’s business that could cause actual results to vary, including the risk that unforeseen factors may result in delays in or failure to obtain FDA approval of PEDMARK, the risks and uncertainties relating to the Company’s reliance on third party manufacturing, the risks that the Company’s NDA resubmission does not adequately address the concerns identified in the CRL previously provided by the FDA, the risk that the NDA resubmission to the FDA will not be satisfactory, that regulatory and guideline developments may change, scientific data and/or manufacturing capabilities may not be sufficient to meet regulatory standards or receipt of required regulatory clearances or approvals, clinical results may not be replicated in actual patient settings, unforeseen global instability, including political instability, or instability from an outbreak of pandemic or contagious disease, such as the novel coronavirus (COVID-19), or surrounding the duration and severity of an outbreak, protection offered by the Company’s patents and patent applications may be challenged, invalidated or circumvented by its competitors, the available market for the Company’s products will not be as large as expected, the Company’s products will not be able to penetrate one or more targeted markets, revenues will not be sufficient to fund further development and clinical studies, the Company may not meet its future capital requirements in different countries and municipalities, and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission including its Annual Report on Form 10-K for the year ended December 31, 2020. Fennec disclaims any obligation to update these forward-looking statements except as required by law.

For a more detailed discussion of related risk factors, please refer to our public filings available at www.sec.gov and www.sedar.com.

For further information, please contact:

Investors:

Robert Andrade

Chief Financial Officer

Fennec Pharmaceuticals Inc.

(919) 246-5299

Media:

Elixir Health Public Relations

Lindsay Rocco

(862) 596-1304

lrocco@elixirhealthpr.com