Appili Therapeutics Reports Financial and Operational Results for First Quarter of Fiscal Year 2025

Rhea-AI Summary

Appili Therapeutics Inc. (TSX:APLI; OTCPink: APLIF) reported its Q1 FY2025 financial results, ending June 30, 2024. Key highlights include:

1. A definitive agreement with Aditxt, offering a premium to shareholders if approved.

2. ATI-1701 secured $14 million in USAFA funding commitments.

3. FDA engagement for ATI-1801's registration strategy.

4. LIKMEZ™ (ATI-1501) launched in the US market.

5. Net loss of $1.6 million ($0.01 per share), slightly higher than Q1 FY2024.

6. Cash position of $0.3 million as of June 30, 2024.

The company is advancing its infectious disease programs, focusing on ATI-1701, ATI-1801, and LIKMEZ™, aiming to benefit patients and shareholders.

Positive

• Secured US$14 million in awards from USAFA for ATI-1701 development
• FDA approval and US launch of LIKMEZ™ (ATI-1501), addressing unmet needs in pediatric and dysphagia patients
• Potential for two Priority Review Voucher (PRV) eligible programs: ATI-1701 and ATI-1801
• Definitive agreement with Aditxt offering a premium to shareholders
• Increased government assistance by $1.6 million compared to Q1 FY2024

Negative

• Net loss increased to $1.6 million, up $0.1 million from Q1 FY2024
• Research and development expenses increased by $0.8 million
• Financing costs increased by $0.8 million
• Foreign exchange loss increased by $0.2 million
• Cash position decreased to $0.3 million from $1 million in the previous quarter

Definitive agreement with Aditxt, if approved by Appili shareholders, provides significant premium to shareholders and resources to advance key programs

ATI-1701 funding commitments from U.S. Air Force Academy and interactions with the U.S. Food and Drug Administration, confirming the development pathway through IND submission

U.S. Food and Drug Administration meeting request submitted to discuss ATI-1801 registration strategy

HALIFAX, Nova Scotia, Aug. 13, 2024 (GLOBE NEWSWIRE) -- Appili Therapeutics Inc. (TSX:APLI; OTCPink: APLIF) (the “Company” or “Appili”), a biopharmaceutical company focused on drug development for infectious diseases and medical countermeasures, today announced its financial and operational results for the first quarter of its fiscal year 2025, which ended on June 30, 2024. All figures are stated in Canadian dollars unless otherwise stated.

"In recent months, we’ve achieved significant milestones by engaging regulatory authorities for ATI-1701 and ATI-1801, and together with our partner, Saptalis Pharmaceuticals, we launched our leading asset, LIKMEZ™ (ATI-1501).” said Don Cilla, President and CEO of Appili. “These achievements, together with ATI-1701 U.S. Air Force Academy (“USAFA”) funding commitments, are expected to enable us to execute on our infectious disease programs and advance their development with the aim of bringing them to market for the benefit of both patients and shareholders.”

ATI-1701, Biodefense Vaccine Candidate with Strong U.S. Air Force Academy Funding Commitments

ATI-1701, a novel live-attenuated vaccine for preventing F. tularensis, has secured US$14 million in awards from the USAFA. Under the USAFA Cooperative Agreement, Appili will manage a comprehensive development program, including nonclinical studies, CMC/manufacturing, clinical preparatory, and regulatory activities supporting an IND submission in 2025.

Appili has engaged with the U.S. Food and Drug Administration (“FDA”) via a pre-IND meeting, confirming the development pathway for ATI-1701, and is incorporating suggested changes into the development plan.

ATI-1801, Topical Antiparasitic Product in Advanced Clinical Development

ATI-1801, a novel topical formulation of paromomycin (15% w/w), is under advanced clinical development for treating cutaneous leishmaniasis, a disfiguring skin infection affecting hundreds of thousands globally.

Appili is currently engaging with the FDA, having submitted a type-B meeting request in 2024 to discuss linking previously generated Phase 3 data and agreeing on the necessary registration package for a New Drug Application submission. Appili aims to pursue non-dilutive funding and partnerships with NGOs and government agencies focused on tropical diseases to complete remaining development work.

ATI-1801 has received Orphan Drug Designation from the FDA for certain forms of cutaneous leishmaniasis. The company is evaluating ATI-1801’s eligibility for a priority review voucher (PRV), which, if confirmed, would make it the second PRV-eligible program at Appili, alongside ATI-1701, which is potentially eligible for a PRV pending renewal of certain U.S. legislation.

LIKMEZ™ (ATI-1501), FDA Approved Liquid Oral Reformulation of the Antibiotic Metronidazole

In September 2023, Appili, together with its U.S. partner, Saptalis Pharmaceuticals LLC., announced the approval by the United States Food and Drug Administration (“FDA”) of LIKMEZ™ (ATI-1501), a proprietary taste-masked liquid suspension formulation of metronidazole. LIKMEZ is the first FDA-approved ready-made suspension of metronidazole, addressing the unmet need in both pediatric patients and patients with dysphagia and mitigating risks associated with drug compounding and antimicrobial resistance.

LIKMEZ, with patent coverage through 2039, is the first and only FDA approved ready-made suspension of metronidazole for the treatment of antimicrobial infections that addresses the unmet need in patients with dysphagia to avoid risks associated with drug compounding, and discontinuation related anti-microbial resistance. Saptalis launched LIKMEZ in November 2023 and the product is now available to patients and doctors in the United States. Appili has the right to receive sales-based milestone payments and royalties from Saptalis based on sale of the product.

Aditxt Arrangement

On April 2, 2024, the Company announced that it had entered into a definitive arrangement agreement (the “Arrangement Agreement“) pursuant to which Aditxt Inc. (“Aditxt”), through its wholly-owned subsidiary, Adivir, Inc., agreed to acquire all of the issued and outstanding Class A common shares of the Company (“Common Shares”) by way of a court-approved plan of arrangement (the “Arrangement”) under the Canada Business Corporations Act. Under the terms of the Arrangement Agreement, shareholders of the Company will receive (i) 0.002745004 of a share of common stock of Aditxt and (ii) US$0.0467 in cash, for each Common Share held at the time of the closing of the proposed Arrangement. For further details regarding the Arrangement, please see Appili’s press release dated April 2, 2024 (the “Arrangement Press Release”). 

Additional details of the Transaction will be described in the management information circular that will be mailed to the Appili Shareholders (the “Appili Circular”) in connection with a special meeting of the Appili Shareholders (the “Appili Meeting”) currently expected to be held in the fall of 2024 to approve the Transaction. Additional information regarding the terms of the Arrangement Agreement, the background to the Transaction, the rationale for the recommendations made by the Appili board of directors (on the basis of the recommendation of its independent special committee) and how shareholders can participate in and vote at the Appili Meeting will be provided in the Appili Circular.

Financial Results

The Company prepares its financial statements in accordance with IFRS Accounting Standards as issued by the International Accounting Standard Board and Part I of Chartered Professional Accountants of Canada Handbook–Accounting. All figures are stated in Canadian dollars unless otherwise stated.

The net loss and comprehensive loss of $1.6 million or $0.01 loss per share for the three months ended June 30, 2024, was $0.1 million higher than the net loss and comprehensive loss of $1.5 million or $0.01 loss per share during the three months ended June 30, 2023. This relates mainly to an increase in research and development expenses of $0.8 million, an increase in financing costs of $0.8 million and an increase of $0.2 million in foreign exchange loss. These increases were offset by an increase in government assistance of $1.6 million, and a decrease in general and administrative expenses by $0.1 million.

As of June 30, 2024, the Company had cash of $0.3 million, compared to $.1 million on March 31, 2024.

As of August 13, 2024, the Company had 121,266,120 issued and outstanding Common Shares, 11,520,281 stock options, and 41,356,874 warrants outstanding.

This press release should be read in conjunction with the Company’s unaudited interim condensed consolidated financial statements for the first quarter of the 2025 fiscal year and the related MD&A, copies of which are available under the Company’s profile on SEDAR+ at www.sedarplus.ca.

About Appili Therapeutics
Appili Therapeutics is an infectious disease biopharmaceutical company that is purposefully built, portfolio-driven, and people-focused to fulfill its mission of solving life-threatening infections. By systematically identifying urgent infections with unmet needs, Appili’s goal is to strategically develop a pipeline of novel therapies to prevent deaths and improve lives. The Company is currently advancing a diverse range of anti-infective s, including an FDA approved ready-made suspension of metronidazole for the treatment of antimicrobial infections, a vaccine candidate to eliminate a serious biological weapon threat, and a topical antiparasitic for the treatment of a disfiguring disease. Led by a proven management team, Appili is at the epicenter of the global fight against infection. For more information, visit www.AppiliTherapeutics.com.  

Forward looking statements
This news release contains “forward-looking statements”, including with respect to the funding commitment from USAFA and expected timing of invoice payment, advancing program towards IND, further anticipated milestones and the timing thereof, the Company’s development plans and timelines with respect to ATI-1501, ATI-1701 and ATI-1801, the timing of any milestone and/or royalty payments in respect of ATI-1501,  consideration to be received by shareholders in connection with the proposed Arrangement, the expected timing and process to complete the Arrangement, and the Company’s expectations with respect to its ability to operate as a going concern and satisfy its ongoing working capital requirements. Wherever possible, words such as “may,” “would,” “could,” “should,” “will,” “anticipate,” “believe,” “plan,” “expect,” “intend,” “estimate,” “potential for” and similar expressions have been used to identify these forward-looking statements. These forward-looking statements reflect the current expectations of the Company’s management for future growth, results of operations, performance and business prospects and opportunities and involve significant known and unknown risks, uncertainties and assumptions, including, without limitation, those listed in the annual information form of the Company dated June 25, 2024, and the other filings made by the Company with the Canadian securities regulatory authorities (which may be viewed at www.sedarplus.ca). Should one or more of these risks or uncertainties materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully, and prospective investors should not place undue reliance on the forward-looking statements. The Company disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise, except as required by law.

All statements included in this press release relating to the Arrangement are qualified by reference to the “Forward Looking Statements” section included in the Arrangement Press Release.

Media Contact:
Jenna McNeil, Communications Manager
Appili Therapeutics
E: JMcNeil@AppiliTherapeutics.com

Investor Relations Contact:
Don Cilla, President and CEO
Appili Therapeutics
E: Info@AppiliTherapeutics.com

FAQ

What were Appili Therapeutics' (APLIF) Q1 FY2025 financial results?

Appili Therapeutics reported a net loss of $1.6 million ($0.01 per share) for Q1 FY2025, slightly higher than the $1.5 million loss in Q1 FY2024. The company had a cash position of $0.3 million as of June 30, 2024.

What major developments did Appili Therapeutics (APLIF) report for ATI-1701 in Q1 FY2025?

Appili secured US$14 million in funding commitments from the U.S. Air Force Academy for ATI-1701, a biodefense vaccine candidate. The company also engaged with the FDA via a pre-IND meeting, confirming the development pathway for ATI-1701.

What is the status of Appili Therapeutics' (APLIF) LIKMEZ™ (ATI-1501) product?

LIKMEZ™ (ATI-1501), an FDA-approved liquid oral reformulation of metronidazole, was launched in the United States in November 2023. Appili has the right to receive sales-based milestone payments and royalties from its partner, Saptalis Pharmaceuticals.

What is the proposed acquisition deal for Appili Therapeutics (APLIF) announced in Q1 FY2025?

Appili announced a definitive arrangement agreement with Aditxt Inc. on April 2, 2024. If approved by shareholders, Aditxt will acquire all outstanding Appili shares, offering a combination of Aditxt common stock and cash for each Appili share.