Cingulate Inc. Reports Fourth Quarter and Full Year 2023 Financial Results and Provides Clinical and Business Update
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Insights
The capital infusion of $17.8 million and the conversion of $9.1 million in debt to equity at a premium for Cingulate Inc. indicates a robust financial strategy aimed at reducing leverage and improving the equity base. The move to convert debt at a premium also suggests a vote of confidence from debt holders in the company's prospects. The company's ability to raise funds through public offerings and At the Market (ATM) offerings, despite varying offering prices, reflects a dynamic capital raising approach and investor interest in their business model and future growth potential.
The engagement in licensing discussions for the commercialization of CTx-1301 in multiple territories could lead to future revenue streams and strategic partnerships. However, the reliance on a single lead asset, CTx-1301, for ADHD treatment could pose risks if regulatory approvals are delayed or if the product doesn't perform as expected in the market. The FDA's guidance on the regulatory pathway for another asset, CTx-2103, under the 505(b)(2) pathway, is positive and could expedite the approval process, potentially reducing time and resources spent on clinical trials.
The clinical progress of CTx-1301, Cingulate's lead ADHD candidate, is noteworthy, especially given the strong effect size reported. Effect size is a critical measure in clinical research as it provides an indicator of the magnitude of treatment effects, irrespective of sample size and is essential for assessing clinical relevance. The trend towards significance in the Phase 3 study, despite a modest sample size, is promising, but investors should be cautious as full statistical significance was not achieved. This could impact the FDA's decision-making process and market acceptance.
Moreover, the FDA's input on CTx-2103 for anxiety, suggesting a 505(b)(2) pathway, is an encouraging development. This pathway allows for a potentially faster approval process by relying on existing data from previously approved drugs. However, the actual approval and subsequent market success will depend on the drug's efficacy, safety profile and competitive landscape.
The appointment of three independent directors with extensive pharmaceutical and small-cap company experience could enhance Cingulate's strategic decision-making and governance. It's an important step for small-cap companies to diversify their board expertise, especially when navigating complex regulatory environments and competitive markets. This addition to the board may also reassure investors about the company's commitment to robust oversight and strategic growth.
However, the market's response to Cingulate's financial maneuvers and clinical updates will hinge on broader industry trends, investor sentiment and the competitive landscape in ADHD and anxiety treatments. The company's performance should be monitored in the context of sector-specific challenges, such as pricing pressures, regulatory hurdles and the entry of generics and new competitors.
Phase 3 ADHD Data Continues to Impress
KANSAS CITY, Kan., April 01, 2024 (GLOBE NEWSWIRE) -- Cingulate Inc. (NASDAQ: CING), a biopharmaceutical company utilizing its proprietary Precision Timed Release™ (PTR™) drug delivery platform technology to build and advance a pipeline of next-generation pharmaceutical products, today announced its financial results for the twelve months ended December 31, 2023, and provided a clinical and business update. Highlights include capital raised from multiple sources and the addition of three independent board members.
“I am pleased to report that Cingulate is stronger today than the end of last year,” said Shane J. Schaffer, Chairman and CEO of Cingulate Inc. “With the addition of three independent directors, each of whom possess deep experience in the pharmaceutical industry, small-cap publicly traded companies, and hold executive leadership roles within pharma, the Cingulate board is equipped to overcome the challenges ahead.
“Our lead asset CTx-1301 continues to impress clinical investigators and key opinion leaders as we share our Phase 3 results. In addition, pharmaceutical companies in the U.S., Europe, and other territories have engaged in licensing discussions regarding their interest to commercialize our product. These tailwinds put Cingulate in a position to obtain non-dilutive capital and expand our pipeline of assets.
“We are encouraged to see the capital markets improving as evidenced by our ability to raise more than
“Overall, I am very pleased with the progress made by our team in 2023 and into 2024. Our focus remains on executing our strategic plan and submitting CTx-1301 to the FDA.”
CTx-1301 Data Exhibits Strong Effect Size
On January 20, 2024, Cingulate presented results from the Phase 3 adult efficacy and safety study of its lead candidate, CTx-1301 (dexmethylphenidate), for the treatment of Attention Deficit / Hyperactivity Disorder (ADHD), at the 2024 American Professional Society of ADHD and Related Disorders (APSARD) conference in Orlando, FL.
The results were previously presented at the 36th Annual Psych Congress in September 2023, where the data was selected as a finalist for the Psych Congress’s First Annual Poster Awards.
The Cingulate poster presented at APSARD provided additional insight regarding CTx-1301’s impressive effect size. Effect size conveys clinical significance rather than statistical significance, is not reliant on sample size, and allows for comparison across trials. The poster presented may be viewed here. The study was not intended nor did it achieve statistical significance on the primary endpoint but demonstrated a trend towards significance despite its modest sample size in improving ADHD symptoms with a rapid onset of action and entire active-day duration.
Cingulate Receives Guidance from FDA on Path Forward for Anxiety Asset CTx-2103 (buspirone)
In December 2023, Cingulate received input from the FDA regarding the regulatory pathway for CTx-2103, and the design of clinical studies for filing of an IND. Based on this FDA feedback, we believe that we can seek and win approval of CTx-2103 under the 505(b)(2) pathway, which typically requires less time and resources than the 505(b)(1) full NDA pathway.
Since January 1, 2024, the Company sold shares of common stock under its At the Market Offering Agreement with H.C. Wainwright & Co., LLC for gross proceeds of
In September 2023, Cingulate closed a
In addition, during 2023, Cingulate sold shares of common stock through its ATM Agreement and its Purchase Agreement with Lincoln Park Capital Fund, LLC for aggregate gross proceeds of
Jennifer Callahan Promoted to CFO
In January 2024, Cingulate promoted longtime Controller Jennifer Callahan to Chief Financial Officer, succeeding Lou Van Horn, who retired from the company in December 2023.
Three Independent Directors Appointed to Cingulate Board
In February 2024, Cingulate appointed three independent directors to its board: Jay Roberts, Bryan Lawrence, and Jeff Ervin. Please visit Cingulate.com for more information about the new directors.
Fourth Quarter and Full Year Results
Cash Position: As of December 31, 2023, Cingulate had
R&D Expenses: Research and development expenses were
G&A Expenses: General and administrative expenses were
Net Loss: Net loss was
| Cingulate Inc. | |||||||
| Consolidated Balance Sheet Data | |||||||
| December 31, | December 31, | ||||||
| 2023 | 2022 | ||||||
| Cash and cash equivalents | $ | 52,416 | $ | 5,356,276 | |||
| Total assets | $ | 3,491,436 | $ | 11,405,057 | |||
| Total liabilities | $ | 10,360,865 | $ | 7,523,035 | |||
| Accumulated deficit | $ | (92,943,443 | ) | $ | (69,408,496 | ) | |
| Total stockholders' equity | $ | (6,869,429 | ) | $ | 3,882,022 | ||
| Cingulate Inc. | |||||||||||||||
| Consolidated Statements of Operations | |||||||||||||||
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Operating expenses: | |||||||||||||||
| Research and development | $ | 4,984,909 | $ | 1,931,654 | $ | 15,493,304 | $ | 8,995,280 | |||||||
| General and administrative | 1,812,242 | 2,543,371 | 7,265,885 | 8,506,438 | |||||||||||
| Operating loss | (6,797,151 | ) | (4,475,025 | ) | (22,759,189 | ) | (17,501,718 | ) | |||||||
| Interest and other income (expense), net | (137,546 | ) | (130,002 | ) | (775,758 | ) | (174,514 | ) | |||||||
| Loss before income taxes | (6,934,697 | ) | (4,605,027 | ) | (23,534,947 | ) | (17,676,232 | ) | |||||||
| Income tax benefit (expense) | - | - | - | - | |||||||||||
| Net loss | $ | (6,934,697 | ) | $ | (4,605,027 | ) | $ | (23,534,947 | ) | $ | (17,676,232 | ) | |||
About Cingulate®
Cingulate Inc. is a biopharmaceutical company utilizing its proprietary Precision Timed Release™ (PTR™) drug delivery platform technology to build and advance a pipeline of next-generation pharmaceutical products, designed to improve the lives of patients suffering from frequently diagnosed conditions characterized by burdensome daily dosing regimens and suboptimal treatment outcomes. With an initial focus on the treatment of Attention Deficit/Hyperactivity Disorder (ADHD), Cingulate is identifying and evaluating additional therapeutic areas where its PTR technology may be employed to develop future product candidates, such as anxiety disorders.
Cingulate is headquartered in Kansas City, KS. For more information visit Cingulate.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include all statements, other than statements of historical fact, regarding our current views and assumptions with respect to future events regarding our business, including statements with respect to our plans, assumptions, expectations, beliefs and objectives with respect to product development, clinical studies, clinical and regulatory timelines, market opportunity, competitive position, business strategies, potential growth opportunities and other statements that are predictive in nature. These statements are generally identified by the use of such words as “may,” “could,” “should,” “would,” “believe,” “anticipate,” “forecast,” “estimate,” “expect,” “intend,” “plan,” “continue,” “outlook,” “will,” “potential” and similar statements of a future or forward-looking nature. Readers are cautioned that any forward-looking information provided by us or on our behalf is not a guarantee of future performance. Actual results may differ materially from those contained in these forward-looking statements as a result of various factors disclosed in our filings with the Securities and Exchange Commission (SEC), including the “Risk Factors” section of our Annual Report on Form 10-K filed with the SEC on March 10, 2023. All forward-looking statements speak only as of the date on which they are made, and we undertake no duty to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.
Investor & Public Relations:
Thomas Dalton
Vice President, Investor & Public Relations, Cingulate
tdalton@cingulate.com
(913) 942-2301
Matt Kreps
Darrow Associates
mkreps@darrowir.com
(214) 597-8200
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