Executive Summary

Q1 2016 delivered positive net income of $1.07M on $0.25M of license revenue, driven primarily by a $2.07M non-operating gain from fair value changes in price-adjustable warrants; basic EPS was $0.04, while diluted EPS printed as a loss due to the impact of potential dilutive instruments .
Operating loss narrowed to $(1.00)M versus $(1.32)M in Q1 2015 and $(1.03)M in Q3 2015, as R&D fell to $0.19M and G&A remained roughly flat at $1.06M .
Liquidity tightened: quarter-end cash was $0.31M, down from $0.71M at year-end 2015 and $1.31M at Q3 2015, underscoring near-term financing needs .
Strategic pivot: Marina (ATRX) executed a term sheet to acquire Turing’s late-stage intranasal ketamine program (closing targeted by July 1, 2016, contingent on financing), and terminated asset sale talks with Microlin Bio on May 2, 2016—both events are likely to drive stock narrative as investors reassess the pipeline and funding path .

What Went Well and What Went Wrong

What Went Well

License revenue initiated: $0.25M from an upfront fee tied to a gene-editing delivery agreement; there were no revenues in Q1 2015, marking a year-over-year inflection .
Net income increased: $1.07M vs. $0.41M in Q1 2015, primarily due to warrant liability fair value changes and revenue recognition; operating loss narrowed YoY .
Strategic pipeline upgrade: “The potential acquisition of Turing’s late-stage intranasal ketamine program places us in a position where we can utilize our legacy expertise and experience to quickly move the compound to commercialization” — J. Michael French, CEO .

What Went Wrong

Cash runway compressed: cash fell to $0.31M at March 31, 2016, heightening reliance on external financing to close the ketamine asset purchase and fund Phase 3 efforts .
Earnings quality heavily non-operating: $2.07M in “Other income” from warrant fair value changes drove profitability, reflecting stock-price-related remeasurements rather than core operations .
Strategic uncertainty: termination of negotiations with Microlin Bio removed a previously signaled path to monetize RNA assets, necessitating new plans to license/sell nucleic acid technologies while minimizing expense impact .

Financial Results

Income Statement and EPS versus Prior Periods

Metric	Q1 2015	Q3 2015	Q1 2016
Revenue ($USD Millions)	$0.00	$0.08	$0.25
Total Operating Expenses ($USD Millions)	$1.315	$1.112	$1.251
Loss from Operations ($USD Millions)	$(1.315)	$(1.032)	$(1.001)
Other Income ($USD Millions)	$1.729	$2.491	$2.068
Net Income Applicable to Common Stockholders ($USD Millions)	$0.414	$0.769	$1.067
Basic EPS ($USD)	$0.02	$0.03	$0.04
Diluted EPS ($USD)	$(0.04)	$(0.06)	$(0.05)

Operating Expense Breakdown

Metric	Q1 2015	Q3 2015	Q1 2016
R&D ($USD Millions)	$0.254	$0.090	$0.192
G&A ($USD Millions)	$1.061	$1.022	$1.059

Liquidity

Metric	Sep 30, 2015	Dec 31, 2015	Mar 31, 2016
Cash ($USD Millions)	$1.313	$0.710	$0.307

Notes:

Q1 2016 revenue derived from a gene-editing delivery license; YoY comparison shows initiation from zero revenues in Q1 2015 .
Other income reflects fair value changes tied to price-adjustable warrants, related to stock price decreases reducing liability values .

Guidance Changes

No financial guidance was provided in the Q1 2016 press release (no ranges for revenue, margins, OpEx, tax rate, or EPS) .

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2016	—	—	N/A
EPS	FY 2016	—	—	N/A
Operating Expenses	FY 2016	—	—	N/A
Capital Needs/Financing	Asset purchase close (by 7/1/2016)	Not previously quantified	“Completion by Marina of a financing transaction yielding proceeds sufficient to initiate and support the Phase 3 efforts” (closing condition)	New disclosure

Earnings Call Themes & Trends

No Q1 2016 earnings call transcript was available in our document catalog [ListDocuments: earnings-call-transcript returned none].

Topic	Previous Mentions (Q-2: Q3 2015)	Previous Mentions (Q-1: FY 2015 YE PR)	Current Period (Q1 2016)	Trend
Gene-editing delivery initiatives	No explicit gene-editing deals; focus on SMARTICLES progress and milestones	Two agreements (Option & Licensing) to deliver gene-editing cargoes; upfront funds operations through June 2016	License revenue from undisclosed genome-editing delivery; R&D includes related sublicense fee	Building commercial traction via delivery tech
Intranasal ketamine program	Not mentioned	Not mentioned	Term sheet to acquire Turing’s late-stage intranasal ketamine program; pending definitive agreement and financing	Strategic pivot toward neuropsychiatric/pain
RNA asset monetization (Microlin)	Not in Q3 PR; milestone from MiNA	Term sheet to sell RNA assets to Microlin (cash + shares), close targeted by July 1, 2016	Negotiations terminated May 2, 2016; pursuing licensing/sale alternatives to maximize value	Re-scoping monetization strategy
Regulatory (CEQ508 Fast Track)	Fast Track for CEQ508 referenced	Fast Track designation for CEQ508 emphasized	Not updated in Q1 PR	No new regulatory update
Cash runway/financing	Raised $1.1M via Series D and warrants in Aug-2015	YE cash $0.7M; funding constraints discussed	Cash $0.31M; financing required to close ketamine asset purchase	Tightening liquidity; financing critical

Management Commentary

“We are excited to complete the transaction with Turing and begin moving the intranasal ketamine program forward. We believe this program offers a therapeutic alternative to a potentially broad patient base suffering from neuropsychiatric and pain disorders for which there are no effective therapeutic alternatives.” — J. Michael French, CEO .
“Over the coming weeks, Marina intends to assess the future needs of the Company… to take this valuable asset forward as quickly and as efficiently as possible.” .
On rationale for Q1 profit: “This change [YoY net income increase] was due primarily to changes in the fair value of the price adjustable warrants, revenue recorded during the first quarter of 2016, and a slight decrease in operating expenses…” .

Q&A Highlights

No Q1 2016 earnings call transcript was available; therefore Q&A highlights and clarifications are unavailable [ListDocuments: earnings-call-transcript returned none].

Estimates Context

S&P Global (Capital IQ) consensus for ATRX Q1 2016 EPS and revenue was unavailable due to missing mapping in SPGI/CIQ for this ticker. As a result, comparison to Street estimates cannot be provided at this time [SpgiEstimatesError for ATRX; GetEstimates].

Metric	Consensus (S&P Global)	Actual (Q1 2016)
Revenue ($USD Millions)	Unavailable (SPGI mapping missing)	$0.25
Basic EPS ($USD)	Unavailable (SPGI mapping missing)	$0.04

Implications: In absence of consensus, investors should note the quarter’s profitability was driven by non-operating gains from warrant revaluation and modest license revenue initiation; model updates should reflect limited visibility into recurring revenue and planned strategic transition .

Key Takeaways for Investors

Earnings quality caution: Profitability hinged on $2.07M warrant liability fair value gains; core operations remained loss-making with $(1.00)M operating loss in Q1 .
Liquidity risk elevated: $0.31M quarter-end cash necessitates near-term financing, which is also a closing condition for the ketamine asset purchase; financing is the key event risk to monitor .
Strategic transition could reset the story: Acquisition of a Phase 3 intranasal ketamine program shifts focus to neuropsychiatric/pain and potential orphan indications, away from RNA asset sale previously contemplated with Microlin .
License-driven revenue path emerging: $0.25M Q1 revenue from gene-editing delivery supports a platform monetization thesis, but visibility remains limited and tied to partner progress .
OpEx discipline: R&D declined to $0.19M; G&A remained ~flat YoY—continued cost control will be important during transition and financing period .
No guidance provided: Lack of financial guidance and no call transcript limit near-term visibility; watch for definitive agreement terms, financing size/timing, and Phase 3 initiation milestones as catalysts .
Trend narrative: From RNA platform monetization to late-stage asset acquisition, the stock’s path likely hinges on closing the Turing transaction and securing sufficient capital to execute Phase 3 .

Sources: Q1 2016 8‑K earnings press release and financials ; FY2015 year‑end 8‑K press release ; Q3 2015 8‑K press releases and financials . S&P Global consensus estimates unavailable for ATRX (SPGI mapping missing; GetEstimates error).

Adhera Therapeutics, Inc. (ATRX)·Q1 2016 Earnings Summary