Filing Reveals Kendall Square's InVivo Therapeutics is Burning Through Cash Fast

With an experimental spinal cord implant trial on hold for more than six months, Cambridge, Mass.-based InVivo Therapeutics has been rapidly burning through cash and may not have enough financing to continue operations for much longer.

In a filing with the U.S. Securities and Exchange Commission, InVivo said there is "substantial doubt" about the company’s ability to continue as a going concern. That doubt, InVivo said, will negatively affect the company’s ability to obtain future financing and may require it to "curtail" operation.

"Our clinical trial has been on hold since July 2017 and we may not be successful at defining a clinical path forward, and, even if we are, we may not be able to raise the funds to complete such clinical path, either of which may cause us to curtail or cease operations," the company said in the filing.

In July the company announced it was temporarily halting its experimental spinal cord implant trial due to a patient death. In June, the patient underwent surgery that implanted the company’s experimental Neuro-Spinal Scaffold. The biodegradable device is surgically implanted in patients who are dealing with a complete thoracic AIS A spinal cord injury. That patient though passed away "suddenly" while at a rehabilitation facility following the surgery, the company said in its announcement at the time. That patient’s death was the third one in the Inspire trial. InVivo said all three of the deaths have been determined to be unrelated to the spinal implant or the surgical procedure used to install the device.

While the company stood by its claims that the deaths were unrelated to the implants, InVivo temporarily halted the trial. The company has been meeting with the U.S. Food and Drug Administration to determine a path forward for the Inspire trial. But in its SEC filing, the company said it "cannot be certain that we will be able to define a clinical path forward, or that we will be able to raise the funds necessary for the clinical path that is required by the FDA."

Citing its September 30, 2017 financial statement, InVivo said it had about $17.2 million available to fund operations through the third quarter of 2018. However, the company said if further clinical studies are required by the FDA to re-start the Inspire trial, the funding will not be adequate.

"If we are unable to define a clinical path forward in a timely manner or in a manner that aligns with our cash resources, or if we are unable to raise capital, we may be forced to cease our operation entirely.  Even if we are able to define a clinical path forward, our ability to continue as a going concern will depend on our ability to obtain additional equity or debt financing, attain further operating efficiencies, reduce or contain expenditures, and, ultimately, to generate revenue," the company said in its filing.

If it cannot move forward, InVivo said it may be forced to liquidate some of its assets.

On Friday, the company announced it entered into a common stock purchase agreement of $15 million with Lincoln Park Capital Fund, LLC.

Shares of InVivo closed at 67 cents on Jan. 26.