Dermata Therapeutics Provides Corporate Update and Reports Third Quarter 2024 Financial Results

Rhea-AI Summary

Dermata Therapeutics (NASDAQ:DRMA) reported its Q3 2024 financial results and corporate updates. The company reached 50% enrollment in its DMT310 Phase 3 STAR-1 clinical trial for moderate-to-severe acne, expecting topline results in Q1 2025. Dermata raised $7.8 million in gross proceeds during 2024, with $6.1 million cash on hand as of September 30, 2024. R&D expenses increased to $2.4 million in Q3 2024 from $0.9 million in Q3 2023, while G&A expenses slightly decreased to $0.8 million. The company continues partnership discussions for its DMT410 botulinum toxin delivery program.

Positive

• Achieved 50% enrollment milestone in Phase 3 STAR-1 clinical trial
• Raised $7.8 million in gross proceeds during 2024
• Previous Phase 2b study showed 45% reduction in inflammatory lesions after four applications

Negative

• Cash decreased from $7.4M to $6.1M compared to December 2023
• R&D expenses increased significantly to $2.4M from $0.9M year-over-year
• Current cash only sufficient to fund operations into Q2 2025

Insights

Financial Analyst

The Q3 results reveal critical financial dynamics for this micro-cap biotech. With $6.1 million in cash as of September 30, the burn rate is concerning - $8.2 million used in operations over nine months. While they raised $7.8 million in 2024, runway only extends to Q2 2025, suggesting potential need for additional financing before Phase 3 completion.

R&D expenses increased significantly to $2.4 million vs $0.9 million YoY, driven by STAR-1 trial costs. The 50% enrollment milestone in their pivotal Phase 3 trial is promising, but investors should monitor cash position carefully given the capital-intensive nature of late-stage clinical development.

Medical Research Analyst

The Phase 3 STAR-1 trial progress for DMT310 in moderate-to-severe acne represents a important milestone. Previous Phase 2b data showing 45% reduction in inflammatory lesions after just four weekly applications is noteworthy in the acne treatment landscape. The once-weekly application could be a significant differentiator from current daily treatments if approved.

The DMT410 program for topical botulinum toxin delivery is particularly interesting - success here could revolutionize aesthetics treatment by eliminating needles. However, partnership discussions without concrete agreements suggest cautious optimism is warranted.

- Dermata nears completion of enrollment in its DMT310 Phase 3 Spongilla Treatment of Acne Research (STAR-1) clinical trial -

- Dermata continues discussions with potential botulinum toxin partners for DMT410 -

- Raised $5.1 million in gross proceeds from financings completed in 3Q 2024 -

SAN DIEGO, CA / ACCESSWIRE / November 13, 2024 / Dermata Therapeutics, Inc. (Nasdaq:DRMA; DRMAW) ("Dermata," or the "Company"), a late-stage biotechnology company focused on the treatment of medical and aesthetic skin diseases and conditions, today highlighted recent corporate progress and reported financial results for the third quarter ended September 30, 2024.

"The third quarter was a busy time for our team as we approach completing enrollment in our DMT310 Phase 3 STAR-1 study and were able to raise funds, which we believe will allow us to reach the topline data readout in the STAR-1 study in the first quarter of 2025," commented Gerry Proehl, Dermata's Chairman, President, and Chief Executive Officer. "We believe patients deserve an acne treatment that is safe, well-tolerated, applied only once-a-week, with a significant 45% reduction in inflammatory lesions after just four applications, as seen in our DMT310 Phase 2b acne study. With many unique features and benefits, we believe DMT310 can cause a paradigm shift in the treatment of moderate-to-severe acne, if approved," concluded Mr. Proehl.

Corporate Highlights

• Achieved 50% enrollment in its DMT310 Phase 3 STAR-1 clinical trial in moderate-to-severe acne. After achieving the 50% enrollment milestone in July 2024, Dermata expects to receive topline results from the STAR-1 study in the first quarter of 2025. STAR-1 is the first of two Phase 3 clinical trials, including a long-term extension study, which the Company will need to complete prior to filing a new drug application with the U.S. Food and Drug Administration.

• Raised $7.8 million in gross proceeds during 2024. The funds raised during 2024, along with the Company's existing cash, is expected to fund its operations into the second quarter of 2025.

Anticipated Upcoming Milestones

• Complete enrollment in its DMT310 Phase 3 STAR-1 clinical trial in moderate-to-severe acne. Dermata expects to complete enrollment in the STAR-1 study by the end of 2024 and plans to announce topline results from the DMT310 Phase 3 STAR-1 study in the first quarter of 2025.

• DMT410 Partnership Discussions. The Company continues to make progress on partnership discussions for its DMT410 program for the topical delivery of botulinum toxin. DMT410 is the Company's combination treatment regimen that uses the unique mechanical features of the Company's DMT310 product to facilitate the intradermal delivery of botulinum toxin by topical application rather than through multiple injections with a needle. The Company believes DMT410 has the potential be to a first-in-class treatment for hyperhidrosis, acne, and facial aesthetics.

Dermata Conference Participation

• Life Sciences Investor Forum

  • Date: Thursday, November 14, 2024

  • Time: 12:00pm ET

  • Link: https://bit.ly/3NuUDa4

• H.C. Wainwright 26th Annual Global Investment Conference

• 2024 Maxim Healthcare Virtual Summit

Third Quarter 2024 Financial Results

As of September 30, 2024, the Company had $6.1 million in cash and cash equivalents, compared to $7.4 million as of December 31, 2023. The $1.3 million decrease in cash and cash equivalents for the nine months ended September 30, 2024, resulted from $8.2 million of cash used in operations offset by $7.0 million in net financing proceeds. The Company expects its current cash resources to be sufficient to fund operations into the second quarter of 2025.

Research and development expenses were $2.4 million for the quarter ended September 30, 2024, compared to $0.9 million for the quarter ended September 30, 2023. The increase in research and development expense was the result of increased clinical trial expenses from the Company's STAR-1 clinical study, offset by decreased non-clinical and chemistry, manufacturing, and control expenses during the third quarter of 2024.

General and administrative expenses were $0.8 million for the quarter ended September 30, 2024, compared to $0.9 million for the quarter ended September 30, 2023. The decrease in general and administrative expenses was the result of decreased insurance costs.

About Dermata Therapeutics

Dermata Therapeutics, Inc. is a late-stage biotechnology company focusing on the treatment of medical and aesthetic skin diseases and conditions. The Company's lead product candidate, DMT310, is the Company's first product candidate being developed from its Spongilla technology platform and is currently being evaluated in a Phase 3 program. DMT310 is a once-weekly topical product candidate derived from a naturally sourced freshwater sponge with multiple unique mechanisms of action. DMT310 has been studied for the treatment of acne, rosacea, and psoriasis. The Company's second program, DMT410, uses its DMT310 product as a new method for topical intradermal delivery of botulinum toxin for the treatment of hyperhidrosis and multiple aesthetic skin conditions. Dermata is headquartered in San Diego, California. For more information, please visit http://www.dermatarx.com/.

Forward-Looking Statements

Statements in this press release that are not strictly historical in nature are forward-looking statements. These statements are based on the Company's current beliefs and expectations and new risks may emerge from time to time. Forward-looking statements are subject to known and unknown risks, uncertainties, assumptions, and other factors including, but are not limited to, statements related to: expectations with regard to the timing of meetings and/or responses from submissions with regulatory bodies; expectations with regard to the timing of submission of an NDA; the uncertainties inherent in clinical trials including enrolling an adequate number of patients on time or be completed on schedule, if at all; timing and ability to generate clinical data; expectations with regard to any potential partnership opportunities for any of the Company's product candidates; the Company's expectations with regard to current cash and cash equivalents and the amount of time it will fund operations; the success, cost, and timing of its product candidates DMT310 and DMT410 development activities and ongoing and planned clinical trials; and whether the results of any ongoing or planned clinical trials of DMT310 or DMT410 will lead to future product development. These statements are only predictions based on current information and expectations and involve a number of risks and uncertainties. Actual events or results may differ materially from those projected in any of such statements due to various factors, including the risks and uncertainties inherent in drug development, approval, and commercialization, and the fact that past results of clinical trials may not be indicative of future trial results. For a discussion of these and other factors, please refer to Dermata's filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All forward-looking statements are qualified in their entirety by this cautionary statement and Dermata undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof, except as required by law.

DERMATA THERAPEUTICS, INC.
Balance Sheets

		September, 2024				December 31, 2023
In thousands USD		(unaudited)
Assets
Cash and cash equivalents		$	6,144			$	7,438
Prepaid expenses and other current assets			543				541
Total assets			6,687				7,979
Liabilities
Accounts payable			864				866
Accrued liabilities			1,082				757
Total liabilities			1,946				1,623
Equity			4,741				6,356
Total liabilities and equity		$	6,687			$	7,979

DERMATA THERAPEUTICS, INC.
Statements of Operations
(unaudited)

		Quarter Ended September 30,								Nine Months Ended September 30,
		2024				2023				2024				2023
In thousands, except share and per share data
Operating expenses
Research and development (1)		$	2,401			$	903			$	6,011			$	2,935
General and administrative (1)			824				909				3,302				2,887
Total operating expenses			3,225				1,812				9,313				5,822
Loss from operations			(3,225	)			(1,812	)			(9,313	)			(5,822	)
Interest income, net			52				93				176				161
Net loss		$	(3,173	)		$	(1,719	)		$	(9,137	)		$	(5,661	)
Net loss per common share, basic and diluted		$	(2.04	)		$	(8.09	)		$	(10.22	)		$	(36.91	)
Weighted average common shares outstanding, basic and diluted			1,554,680				212,544				894,168				153,380
(1) Includes the following stock-based compensation expense
Research and development		$	5			$	48			$	247			$	145
General and administrative		$	16			$	83			$	381			$	248

Investors:

Cliff Mastricola
Investor Relations
cmastricola@dermatarx.com

SOURCE: Dermata Therapeutics

View the original press release on accesswire.com

FAQ

What were Dermata's (DRMA) Q3 2024 R&D expenses?

Dermata's R&D expenses were $2.4 million for Q3 2024, compared to $0.9 million in Q3 2023, primarily due to increased STAR-1 clinical trial expenses.

How much cash does Dermata (DRMA) have as of Q3 2024?

Dermata had $6.1 million in cash and cash equivalents as of September 30, 2024, compared to $7.4 million as of December 31, 2023.

When does Dermata (DRMA) expect topline results from the STAR-1 trial?

Dermata expects to announce topline results from the DMT310 Phase 3 STAR-1 study in the first quarter of 2025.