PhaseRx, Inc. (Exact name of registrant as specified in its charter)

Transcription

1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 12, 2017 PhaseRx, Inc. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 410 W. Harrison Street, Suite 300 Seattle, Washington (Address of principal executive offices) (Zip Code) Registrant s telephone number, including area code: (206) (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4(c)) Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ( of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 ( b-2 of this chapter). Emerging growth company x If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x

2 Item 2.05 Costs Associated with Exit or Disposal Activities. On October 12, 2017, management of PhaseRx, Inc. (the Company ) commenced a reduction in its workforce to reduce operating costs and conserve cash resources while it pursues strategic options for its research and development assets. Under this plan, which is expected to be completed in October 2017, the Company expects to reduce its overall workforce by 10 employees (or 50%), including some executive officers. In connection with the reduction in force, the Company estimates that it will incur aggregate cash charges of between $411,000 and $426,000 related to one-time termination benefits, including severance, and other employee related costs, all of which are expected to be incurred and paid during October As a part of the reduction in workforce, the Company also announced that it will delay the development of its lead product candidate PRX-OTC. The Company expects to incur additional charges in connection with its decision to seek strategic alternatives as part of this restructuring plan, which amounts cannot be determined as of the filing of this Current Report on Form 8-K. Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. As part of the workforce reduction, the Company terminated employment of Michael Houston, Ph.D., the Company s chief scientific officer, effective as of October 12, Item 8.01 Other Events. On October 13, 2017, the Company issued a press release announcing the workforce reduction and review of strategic alternatives. A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. Item Financial Statements and Exhibits. (d) Exhibits. Exhibit No Press release, dated October 13, 2017 Description

3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PhaseRx, Inc. Date: October 13, 2017 By: /s/ Robert W. Overell Robert W. Overell, Ph.D. Chief Executive Officer

4 Exhibit 99.1 PhaseRx Announces Corporate Restructuring and Review of Strategic Alternatives SEATTLE, October 13, PhaseRx, Inc. (NASDAQ: PZRX), a biopharmaceutical company developing mrna treatments for life-threatening inherited liver diseases in children, today announced that its board of directors has made a determination to conduct a restructuring of operations to reduce short term operating costs and delay the development of its lead product candidate PRX-OTC. This reorganization includes a reduction in PhaseRx s workforce by 10 employees, including some executive officers. These efforts are aimed at preserving the company s cash resources. As of June 30, 2017, PhaseRx had cash and equivalents of $8.4 million and a total of 20 employees. The board of directors has also begun a review of strategic alternatives, including but not limited to a potential merger transaction. The company has not set a timetable for this process. No decision has been made as to whether the company will engage in a transaction or transactions and there can be no assurance that the review of strategic alternatives will result in a transaction, or the terms or timing of any potential transaction that may take place. The company does not intend to discuss or disclose further developments during this process unless and until its board of directors has approved a specific action or otherwise determined that further disclosure is appropriate. About PhaseRx PhaseRx is a biopharmaceutical company dedicated to developing mrna products for the treatment of children with inherited enzyme deficiencies in the liver using intracellular enzyme replacement therapy (i-ert). PhaseRx's initial product development focus is on urea cycle disorders, a group of rare genetic diseases that generally present before the age of twelve and are characterized by the body's inability to remove ammonia from the blood with potentially devastating consequences for patients. The company's i-ert approach is enabled by its proprietary Hybrid mrna Technology platform. PhaseRx is headquartered in Seattle. For more information, please visit

5 Safe Harbor Statement This press release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the company's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) the fact that the company has incurred significant losses since its inception and anticipates that it will continue to incur significant losses for the foreseeable future, (ii) the company being dependent on technologies it has licensed and that it may need to license in the future, (iii) the fact that the company will need to raise substantial additional funding to develop its planned products, (iv) the fact that the company's Hybrid mrna Technology has not previously been tested beyond company preclinical studies, and that mrna-based drug development is unproven, (v) the fact that all of the company's programs are in preclinical studies or early stage research and it is uncertain that any company product candidates will receive regulatory approval or be commercialized, (vi) the fact that development of the company's product candidates will be expensive, time-consuming and subject to regulatory approval, (vii) the company expecting to continue to incur significant research and development expenses, (viii) the company becoming dependent on collaborative arrangements for the development and commercialization of its products, (ix) the company's ability to adequately protect its proprietary technology from legal challenges, infringement or alternative technologies and (x) the biotechnology and pharmaceutical industries being intensely competitive. More detailed information about the company and the risk factors that may affect the realization of forward looking statements is set forth in the company's filings with the Securities and Exchange Commission (SEC), including the most recent annual report on Form 10-K and its quarterly reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC's web site at The company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise. Contacts: Corporate Communications Contact: Jason Spark Canale Communications Senior Vice President jason@canalecomm.com Investor Contact: Robert H. Uhl Westwicke Partners, LLC Managing Director robert.uhl@westwicke.com ###