Cyclo Therapeutics Provides Business Update and Reports Second Quarter 2021 Financial Results

Rhea-AI Summary

Cyclo Therapeutics (Nasdaq: CYTH) reported its Q2 2021 financial results, highlighting positive topline results from its Phase 1/2 NPC study and the initiation of a pivotal Phase 3 NPC study. The net loss for the quarter was approximately $3.6 million, with R&D expenses increasing by 54% to $2.6 million due to heightened clinical activities. The company commenced commercial-scale manufacturing of Trappsol® Cyclo™ and received positive FDA feedback for its Alzheimer's program, planning an IND submission for a Phase 2 study by year-end 2021. Cash reserves stood at $11.4 million.

Positive

• Positive topline results from Phase 1/2 NPC study.
• Initiation of pivotal Phase 3 NPC study.
• R&D expense increase reflects enhanced clinical program activity.
• Commenced commercial-scale manufacturing of Trappsol® Cyclo™.
• FDA provided positive feedback for Alzheimer's development strategy.

Negative

• Net loss of approximately $3.6 million.
• Research and development expenses increased 54%.

Cyclo Therapeutics, Inc. (Nasdaq: CYTH) (“Cyclo Therapeutics” or the “Company”), a clinical stage biotechnology company dedicated to developing life-changing medicines through science and innovation for patients and families living with diseases, today reported its financial results for the second quarter of 2021, and provided a business update.

“Our second quarter was marked by solid execution across multiple fronts. On the heels on positive topline results from our Phase 1/2 study in NPC and the recently announced positive long-term safety and efficacy from our Phase 1 open-label extension study, we have continued to build on that momentum and initiated our pivotal Phase 3 study in NPC as well as commenced commercial-scale manufacturing for Trappsol^® Cyclo™. Additionally, with the positive feedback from the FDA supporting our strategy moving forward with our Alzheimer’s Disease program, we continue to advance towards multiple catalytic milestones ahead. I am incredibly pleased with our team and our progress and believe we are poised for an exciting remainder of the year and beyond,” commented N. Scott Fine, CEO of Cyclo Therapeutics.

Recent Highlights

• Announced new positive safety and efficacy data from ongoing Phase 1 open-label extension study of Trappsol^® Cyclo™ for the treatment of NPC;
• Commenced the commercial-scale production of batches of Trappsol^® Cyclo™ which will be used to support ongoing TransportNPC™ study in NPC1, the upcoming Phase 2 study in Alzheimer’s Disease, and the Company’s active compassionate use program;
• Commenced site activation and patient enrollment for the TransportNPC™ study evaluating Trappsol^® Cyclo™ for the treatment of NPC1;
• Appointed Lori McKenna Gorski as Global Head of Patient Advocacy. Ms. Gorski is a leading biotechnology executive with more than 20 years of experience specializing in patient advocacy for rare disease communities, including lysosomal disorders; and
• Received feedback from the FDA supporting the Company’s development strategy to submit an IND application for a Phase 2 study of Trappsol^® Cyclo™ in the treatment of early Alzheimer’s Disease, following a positive Type B interaction.

Trappsol^® Cyclo™ Clinical Program Update

Trappsol^® Cyclo™ is a proprietary formulation of hydroxypropyl beta cyclodextrin, used intravenously (IV) and currently in development for the treatment of NPC, a rare genetic disorder causing cholesterol accumulation in lysosomes of cells, organ dysfunction and premature death.

Niemann-Pick Disease Type C1 Development Program

In June 2021, the Company commenced the TransportNPC™ study evaluating Trappsol^® Cyclo™ for the treatment of NPC1, a rare, progressive and fatal genetic disorder. Initial sites are in the U.S.

The pivotal Phase 3 study is a randomized, double-blind, placebo-controlled, parallel group, multicenter study designed to evaluate the safety, tolerability, and efficacy of 2,000 mg/kg doses of Trappsol^® Cyclo™ administered intravenously and standard of care (SOC), compared to placebo administered intravenously and SOC alone, in patients with NPC1. The Phase 3 study intends to enroll at least 93 pediatric (age 3 years and older) and adult patients with NPC1 in at least 23 study centers in 9 countries. Eligible patients will be randomized 2:1 to receive either Trappsol^® Cyclo™ or a placebo. Randomization will not be constrained based on patient age, nor will patient enrollment be gated by patient age. The study duration is 96 weeks and includes an interim analysis at 48 weeks.

The Company recently received a positive opinion from the Paediatric Committee (PDCO) of the EMA and agreement on its Paediatric Investigation Plan (PIP) for Trappsol^® Cyclo™. The PIP opinion from PDCO endorsed the clinical program to evaluate the safety, tolerability and efficacy of Trappsol^® Cyclo™ in patients from 3 to less than 18 years of age with NPC in the randomized study, and in addition, to include a single-arm open-label sub-study of patients from birth to less than 3 years of age with NPC Type C1 irrespective of symptoms to evaluate safety and to obtain descriptive data on global disease severity and the response to Trappsol^® Cyclo™. The sub-study in patients from birth to less than 3 years of age will only be conducted in the EU and countries following EMA guidelines.

Additionally, Cyclo Therapeutics recently presented new long-term safety and efficacy data from its ongoing Phase 1 open-label extension study evaluating Trappsol^® Cyclo™ for the treatment of NPC. The data seen to-date provide additional support for the capacity of Trappsol^® Cyclo™ to stabilize disease progression with home-based intravenous infusions as well as for a favorable safety profile of more than two years in NPC.

For more information about the Company’s TransportNPC™ pivotal Phase 3 study, visit www.ClinicalTrials.gov and reference identifier NCT04860960.

Cyclo Therapeutics received Orphan Drug Designation for Trappsol^® Cyclo™ to treat NPC1 in both the U.S. and EU and Fast Track and Rare Pediatric Disease Designations in the U.S. The Rare Pediatric Disease Designation is one of the chief requirements for sponsors to receive a Priority Review Voucher in the U.S. upon marketing authorization.

Alzheimer’s Disease Asset

Cyclo Therapeutics is also planning to evaluate Trappsol^® Cyclo™ for the treatment of Alzheimer’s Disease, targeting the reduction of amyloid beta and tau. As part of a Type B interaction with the FDA, Cyclo Therapeutics received positive feedback supporting the Company’s development strategy to submit an IND application for a Phase 2 study of intravenous Trappsol^® Cyclo™ in the treatment of early Alzheimer’s disease. The Company is on track to file its IND for a Phase 2 study of Alzheimer’s disease before year-end 2021.

Expected Upcoming Milestones

• Target filing IND in H2 2021 for potential Phase 2 study evaluating Trappsol^® Cyclo™ for the treatment of Alzheimer’s Disease.

Summary of Financial Results for Second Quarter 2021

Net loss for the quarter ended June 30, 2021 was approximately $3.6 million. Research and development expenses increased 54% to $2.6 million for the three months ended June 30, 2021, from $1.7 million for the three months ended June 30, 2020. The increase in research and development expense is due to increased activity in the Company’s international clinical program and U.S. clinical trials. The Company expects research and development costs to further increase in 2021 as we continue to seek regulatory approval for the use of Trappsol^® Cyclo™ in the treatment of NPC and Alzheimer’s disease.

The Company ended the quarter with approximately $11.4 million of cash.

About Cyclo Therapeutics

Cyclo Therapeutics, Inc. is a clinical-stage biotechnology company dedicated to developing life-changing medicines through science and innovation for patients and families suffering from disease. The Company’s Trappsol^® Cyclo™, an orphan drug designated product in the United States and Europe, is the subject of four formal clinical trials for Niemann-Pick Disease Type C, a rare and fatal genetic disease, (www.ClinicalTrials.gov NCT02939547, NCT02912793, NCT03893071 and NCT04860960). The Company is planning an early phase clinical trial using Trappsol^® Cyclo™ intravenously in Alzheimer’s Disease based on encouraging data from an Expanded Access program for late-onset Alzheimer’s Disease (NCT03624842). Additional indications for the active ingredient in Trappsol^® Cyclo™ are in development. For additional information, visit the Company’s website: www.cyclotherapeutics.com.

Safe Harbor Statement

This press release contains “forward-looking statements” about the company’s current expectations about future results, performance, prospects and opportunities, including, without limitation, statements regarding the satisfaction of closing conditions relating to the offering and the anticipated use of proceeds from the offering. Statements that are not historical facts, such as “anticipates,” “believes” and “expects” or similar expressions, are forward-looking statements. These statements are subject to a number of risks, uncertainties and other factors that could cause actual results in future periods to differ materially from what is expressed in, or implied by, these statements. The factors which may influence the company’s future performance include the company’s ability to obtain additional capital to expand operations as planned, success in achieving regulatory approval for clinical protocols, enrollment of adequate numbers of patients in clinical trials, unforeseen difficulties in showing efficacy of the company’s biopharmaceutical products, success in attracting additional customers and profitable contracts, and regulatory risks associated with producing pharmaceutical grade and food products. These and other risk factors are described from time to time in the company’s filings with the Securities and Exchange Commission, including, but not limited to, the company’s reports on Forms 10-K and 10-Q. Unless required by law, the company assumes no obligation to update or revise any forward-looking statements as a result of new information or future events.

-- Financial Tables Follow--

CONSOLIDATED BALANCE SHEETS
		June 30, 2021				December 31, 2020
		(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	11,463,098			$	12,846,113
Accounts receivable			182,431				71,017
Inventory, net			268,930				237,909
Current portion of mortgage note receivable			42,053				40,772
Prepaid insurance and services			172,191				126,474
Prepaid clinical expenses			1,991,866				727,952
Total current assets			14,120,569				14,050,237
FURNITURE AND EQUIPMENT, NET			67,997				53,910
RIGHT-TO-USE LEASE ASSET, NET			26,453				34,011
MORTGAGE NOTE RECEIVABLE, LESS CURRENT PORTION			28,356				49,806
TOTAL ASSETS		$	14,243,375			$	14,187,964
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Current portion of lease liability		$	18,014			$	17,483
Current portion of note payable			86,884				114,029
Accounts payable and accrued expenses			2,930,267				3,541,041
Total current liabilities			3,035,165				3,672,553
LONG-TERM LEASE LIABILITY
Long-term lease liability, less current portion			10,392				18,434
Long-term note payable, less current portion			71,640				44,495
Total long-term liabilities			82,032				62,929
STOCKHOLDERS' EQUITY
Common stock, par value $.0001 per share, 20,000,000 shares authorized, 6,437,881 and 4,770,761 shares issued and outstanding, at June 30, 2021 and December 31, 2020, respectively			644				477
Preferred stock, par value $.0001 per share, 5,000,000 shares authorized			-				-
Additional paid-in capital			52,821,383				44,513,841
Accumulated deficit			(41,695,849	)			(34,061,836	)
Total stockholders' equity			11,126,178				10,452,482
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	14,243,375			$	14,187,964

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2021				2020				2021				2020
REVENUES
Product sales		$	238,590			$	209,594			$	596,723			$	535,328
EXPENSES
Personnel			542,192				433,628				1,101,516				903,333
Cost of products sold (exclusive of direct and indirect overhead and handling costs)			30,158				12,947				64,754				39,380
Research and development			2,643,544				1,713,435				5,901,659				3,773,041
Repairs and maintenance			1,647				1,311				3,313				3,113
Professional fees			373,618				143,427				596,489				362,963
Office and other			241,739				79,823				555,513				258,185
Board of Director fees and costs			-				21,367				-				28,716
Depreciation			4,863				3,118				8,413				6,236
Freight and shipping			1,281				1,169				2,794				3,032
Bad debt expense			-				1,272				-				1,272
Total operating expenses			3,839,042				2,411,497				8,234,451				5,379,271
LOSS FROM OPERATIONS			(3,600,452	)			(2,201,903	)			(7,637,728	)			(4,843,943	)
OTHER INCOME
Investment and other income			3,054				9,511				3,715				17,559
LOSS BEFORE INCOME TAXES			(3,597,398	)			(2,192,392	)			(7,634,013	)			(4,826,384	)
PROVISION FOR INCOME TAXES			-				-				-				-
NET LOSS		$	(3,597,398	)		$	(2,192,392	)		$	(7,634,013	)		$	(4,826,384	)
BASIC AND DILUTED NET LOSS PER COMMON SHARE		$	(.56	)		$	(1.61	)		$	(1.31	)		$	(3.74	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING			6,368,025				1,366,761				5,842,100				1,291,205

 

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FAQ

What were Cyclo Therapeutics' Q2 2021 financial results for CYTH?

Cyclo Therapeutics reported a net loss of approximately $3.6 million for Q2 2021, with research and development expenses increasing by 54% to $2.6 million.

What is the current status of Cyclo Therapeutics' clinical trials?

Cyclo Therapeutics has initiated its pivotal Phase 3 study for Niemann-Pick Disease Type C and reported positive results from its Phase 1/2 study.

What upcoming milestones does Cyclo Therapeutics have?

Cyclo Therapeutics is on track to file an IND for a Phase 2 study evaluating Trappsol® Cyclo™ for Alzheimer's Disease before the end of 2021.

How is Cyclo Therapeutics' cash position as of Q2 2021?

Cyclo Therapeutics ended Q2 2021 with approximately $11.4 million in cash.

What progress has Cyclo Therapeutics made in its Alzheimer's Disease program?

Cyclo Therapeutics received positive feedback from the FDA regarding its development strategy and plans to submit an IND application for a Phase 2 study.