Functional and presentation currency

These condensed consolidated interim financial statements are presented in US dollars (“US$” or “$”), which is the Company’s functional currency and the Company’s presentation currency.

Foreign operations

Assets and liabilities of Company entities whose functional currency is other than US$ are included in the consolidation by translating the assets and liabilities into the presentation currency at the exchange rates applicable at the end of the reporting period. Income and expenses are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions).

Foreign currency translation differences are recognized in OCI and presented in the foreign currency translation reserve in equity. When a foreign operation is disposed of such that control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal.

Closing exchange rates for the most significant foreign currencies relative to US$:

Average exchange rates for the year for the most significant foreign currencies relative to US$:

New standards, amendments and interpretations adopted by the Company

The application of these new standards, amendments to standards and interpretations did not have a material impact on the financial statements of the Company.

Going concern

The Company expects its research and development expenses to remain significant as it continues to develop its RNA delivery platforms and advance or initiate the pre-clinical and clinical development of its product candidates. It also expects to continue to incur additional costs associated with operating as a public company. To the extent that the Company will be unable to generate sufficient cash proceeds from the planned divestiture or partnering of its legacy assets or other partnering activities, it will need substantial additional financing to meet these funding requirements. Additional funds may not be available on a timely basis, on favorable terms, or at all, and such funds, if raised, may not be sufficient to enable it to continue to implement its long-term business strategy. If the Company is unable to raise capital when needed, it could be forced to delay, reduce or eliminate its research and development programs, which could materially harm its business, prospects, financial condition and operating results. This could then result in bankruptcy, or the liquidation of the Company. These factors raise substantial doubt about its ability to continue as a going concern.

The Company’s Board of Directors has considered the cash flow forecasts and the funding requirements of the business and continues to explore and pursue various funding opportunities, including loans or convertible loans, the partial spin-off of the Company’s RNA delivery business (which would subsequently become independently funded), divestitures of legacy assets, and licensing revenues. Based on currently available information and data, the Board of Directors considers it feasible to generate $2.8 to $3.5 million in funding within 12 months from the reporting date. At the date of issuing these financial statements, such plans have not yet been fully realized. 

 The Company’s assumptions may prove to be wrong, and the Company may have to use its capital resources sooner than it currently expects. As is often the case with drug development companies, the ability of the consolidated entity to continue its activities as a going concern is dependent upon it completing the spin-off of a majority of the RNA delivery business, deriving sufficient cash from licensing and partnering activities, and from other sources of revenue such as grant funding. To the extent that the Company will be unable to generate sufficient cash proceeds from these sources, it may need substantial additional financing to meet its funding requirements. While Management and the Board of Directors continue to apply best efforts to evaluate available options, there is no guarantee that any transaction can be realized or that such transaction would generate sufficient funds to finance operations for twelve months from the issuance of these financial statements. 

The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal activities and realization of assets and settlement of liabilities in the normal course of business. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The lack of a going concern assessment may negatively affect the valuation of the Company’s investments in its subsidiaries and result in a revaluation of these holdings. The Company’s Board of Directors will need to consider the interests of the Company’s creditors and take appropriate action to restructure the business if it appears that the Company is insolvent or likely to become insolvent.