Edesa Biotech Reports Fiscal 1st Quarter 2024 Results
- Secured C$23 million funding from the Canadian government for ARDS drug candidate EB05.
- Plan to evaluate the drug in a broader ARDS population and file an IND for a Phase 2 study in pulmonary fibrosis.
- Intend to conduct a Phase 2 study for their anti-CXCL10 monoclonal antibody in vitiligo patients.
- Engaged in strategic discussions for commercialization and licensing partnerships.
- Operating expenses decreased, research and development expenses declined, and general and administrative expenses increased slightly.
- Total other income rose significantly.
- Reported a net loss of $1.7 million for the quarter.
- Cash and cash equivalents of $4.3 million and working capital of $3.4 million.
- None.
Insights
Edesa Biotech's announcement of secured funding from the Canadian government and the harmonization of clinical trial designs indicates a strategic move to streamline its development process for its ARDS drug candidate, EB05. The funding not only provides financial support but also suggests government confidence in the potential of EB05. The conditionally repayable nature of the funding could imply a lower risk of dilution for current shareholders compared to other forms of equity financing. Additionally, the approval from Canadian regulators to harmonize U.S. and Canadian trial designs could expedite the development process and reduce redundant costs.
From a financial perspective, the reported decrease in total operating expenses and research and development costs reflects efficient capital management and may be seen positively by investors. However, the increase in general and administrative expenses, driven by professional fees and noncash share-based compensation, should be monitored as it may affect the company's burn rate. The reported net loss has decreased year-over-year, which could indicate improving operational efficiency, but the company's cash position and working capital of $4.3 million and $3.4 million, respectively, suggest that additional funding may be needed to sustain long-term operations, especially with planned Phase 2 and potential Phase 3 studies on the horizon.
The clinical development of Edesa's EB05 for ARDS and the investigational new drug application for pulmonary fibrosis represent significant milestones in addressing critical unmet medical needs. ARDS, a life-threatening respiratory condition often requiring intensive care, lacks specific treatments, making EB05's progress particularly noteworthy. The decision to evaluate paridiprubart in a broader ARDS population reflects an understanding of the disease's heterogeneity and the need for effective therapies across various patient subgroups.
The advancement of the anti-CXCL10 monoclonal antibody for moderate-to-severe nonsegmental vitiligo also highlights Edesa's commitment to diversifying its pipeline in immuno-inflammatory diseases. Vitiligo, an autoimmune condition causing skin depigmentation, significantly impacts patients' quality of life and current treatment options are limited. A new therapeutic approach could offer substantial benefits to patients and, if successful, position Edesa in a niche but growing market segment.
Edesa Biotech's focus on allergic contact dermatitis with its EB01 drug candidate taps into a potentially lucrative dermatology market. The mention of 'first-in-class' suggests that EB01 may offer a novel mechanism of action, which could differentiate it from existing treatments and attract interest from both patients and healthcare providers. The company's anticipation of a 'large untapped growth market' for EB01 indicates market research confidence in the demand for new dermatitis treatments.
Furthermore, the company's strategic discussions for commercialization and licensing partnerships are critical for its go-to-market strategy. These partnerships could provide the necessary resources and expertise for successful product launches. Investors should pay attention to the outcomes of these discussions, as they will significantly impact Edesa's market presence and revenue potential in the dermatology sector.
TORONTO, ON / ACCESSWIRE / February 9, 2024 / Edesa Biotech, Inc. (Nasdaq:EDSA), a clinical-stage biopharmaceutical company focused on developing host-directed therapeutics for immuno-inflammatory diseases, today reported financial results for the three months ended December 31, 2023 and provided an update on its business.
During the first fiscal quarter, the company secured funding of up to C
"We believe that the positive momentum that Edesa demonstrated at the beginning of the year puts us on a solid path to advance our respiratory and dermatology assets, including strategic discussions with potential commercialization and licensing partners," said Par Nijhawan, MD, Chief Executive Officer of Edesa Biotech. "Engagements with regulatory agencies have also been productive, and Edesa is on track with key regulatory submissions, including clearance of INDs for our vitiligo and fibrosis projects."
Edesa's Chief Financial Officer Stephen Lemieux reported that the company continues to benefit from the flexibility of its business model as it advances its clinical programs. "With our government funding and access to capital, we have extended our cash runway, with the option to ramp up our development activities in vitiligo and pulmonary fibrosis through potential partnerships, non-dilutive programs, direct investments in projects and other financings," he said.
Mr. Lemieux reported that Edesa is evaluating potential partnerships and funding opportunities to complete a future Phase 3 study of its dermatitis drug candidate, EB01 (
Financial Results for the Three Months Ended December 31, 2023
Total operating expenses decreased by
Research and development expenses decreased by
General and administrative expenses increased by
Total other income increased by
For the quarter ended December 31, 2023, Edesa reported a net loss of
Working Capital
At December 31, 2023, Edesa had cash and cash equivalents of
Calendar
Edesa management plans to participate in the American Contact Dermatitis Society Annual Meeting on March 7, 2024, the American Academy of Dermatology Annual Meeting from March 8-12, 2024 and BIO Europe Spring 2024 from March 18-20, 2024. Attendees interested in meeting with management can request meetings through the conference organizers or by contacting Edesa directly at investors@edesabiotech.com.
About Edesa Biotech, Inc.
Edesa Biotech, Inc. (Nasdaq:EDSA) is a clinical-stage biopharmaceutical company developing innovative ways to treat inflammatory and immune-related diseases. The company's most advanced drug candidate is EB05 (paridiprubart), a monoclonal antibody developed for acute and chronic disease indications that involve dysregulated innate immune responses. Edesa is currently evaluating EB05 in a Phase 3 study as a potential treatment for Acute Respiratory Distress Syndrome (ARDS), a life-threatening form of respiratory failure. The company has also received regulatory approval to conduct a Phase 2 trial its EB06 (anti-CXCL10) monoclonal antibody as a treatment for vitiligo, a life-altering autoimmune disease that causes skin to lose its color in patches. In addition, Edesa is developing an sPLA2 inhibitor, EB01 (
Edesa Forward-Looking Statements
This press release may contain 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. Forward-looking statements may be identified by the use of words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "may," "will," "would," "could," "should," "might," "potential," or "continue" and variations or similar expressions, including statements related to: the company's plans to evaluate paridiprubart in a broader ARDS population as well as file an IND for a Phase 2 study in pulmonary fibrosis; the company's plans for a Phase 2 study of its anti-CXCL10 monoclonal antibody in moderate-to-severe nonsegmental vitiligo patients; the company's belief that the positive momentum that Edesa demonstrated at the beginning of the year puts it on a solid path to advance its respiratory and dermatology assets, including strategic discussions with potential commercialization and licensing partners; the company's belief that engagements with regulatory agencies have been productive, and the Edesa is on track with key regulatory submissions, including clearance of INDs for our vitiligo and fibrosis projects; the company belief that it has continued access to capital and government funding, it has extended its cash runway, and has the option to ramp up its development activities in vitiligo and pulmonary fibrosis through potential partnerships, non-dilutive programs, direct investments in projects and other financings; the company's ongoing plans to evaluate potential partnerships and funding opportunities to complete a future Phase 3 study of EB01; the company's belief that ACD represents a large untapped growth market for the dermatology sector; the company's belief that EB01 is a first-in-class drug candidate that offers a potential new treatment paradigm for the dermatology market, and its plans to advance its EB01 development program one step closer to commercialization; and the company's timing and plans regarding its clinical studies in general. Readers should not unduly rely on these forward-looking statements, which are not a guarantee of future performance. There can be no assurance that forward-looking statements will prove to be accurate, as all such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results or future events to differ materially from the forward-looking statements. Such risks include: the ability of Edesa to obtain regulatory approval for or successfully commercialize any of its product candidates, the risk that access to sufficient capital to fund Edesa's operations may not be available or may be available on terms that are not commercially favorable to Edesa, the risk that Edesa's product candidates may not be effective against the diseases tested in its clinical trials, the risk that Edesa fails to comply with the terms of license agreements with third parties and as a result loses the right to use key intellectual property in its business, Edesa's ability to protect its intellectual property, the timing and success of submission, acceptance and approval of regulatory filings, and the impacts of public health crises. Many of these factors that will determine actual results are beyond the company's ability to control or predict. For a discussion of further risks and uncertainties related to Edesa's business, please refer to Edesa's public company reports filed with the U.S. Securities and Exchange Commission and the British Columbia Securities Commission. All forward-looking statements are made as of the date hereof and are subject to change. Except as required by law, Edesa assumes no obligation to update such statements.
Contact:
Gary Koppenjan
Edesa Biotech, Inc.
(289) 800-9600
investors@edesabiotech.com
Condensed Interim Consolidated Statements of Operations
(Unaudited)
| Three Months Ended | ||||||||
| December 31, 2023 | December 31, 2022 | |||||||
Expenses: | ||||||||
Research and development | $ | 704,458 | $ | 1,357,338 | ||||
General and administrative | 1,152,971 | 1,020,967 | ||||||
Loss from operations | (1,857,429 | ) | (2,378,305 | ) | ||||
Other Income (Loss): | ||||||||
Reimbursement grant income | 120,834 | - | ||||||
Other income (loss) | 58,144 | 43,488 | ||||||
Net loss | (1,678,451 | ) | (2,334,817 | ) | ||||
Exchange differences on translation | (572 | ) | (25,067 | ) | ||||
Net comprehensive loss | $ | (1,679,023 | ) | $ | (2,359,884 | ) | ||
Weighted average number of common shares | 3,128,024 | 2,626,847 | ||||||
Loss per common share - basic and diluted | $ | (0.54 | ) | $ | (0.89 | ) | ||
Condensed Interim Consolidated Balance Sheets
(Unaudited)
| December 31, 2023 | September 30, 2023 | |||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 4,267,787 | $ | 5,361,397 | ||||
Other current assets | 1,148,472 | 1,075,455 | ||||||
Non-current assets | 2,415,531 | 2,453,585 | ||||||
Total Assets | $ | 7,831,790 | $ | 8,890,437 | ||||
Liabilities and shareholders' equity: | ||||||||
Current liabilities | $ | 1,986,912 | $ | 1,821,864 | ||||
Non-current liabilities | - | 19,773 | ||||||
Shareholders' equity | 5,844,878 | 7,048,800 | ||||||
Total liabilities and shareholders' equity | $ | 7,831,790 | $ | 8,890,437 | ||||
Condensed Interim Consolidated Statements of Cash Flows
(Unaudited)
| Three Months Ended | ||||||||
| December 31, 2023 | December 31, 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (1,678,451 | ) | $ | (2,334,817 | ) | ||
Adjustments for non-cash items | 229,388 | 360,872 | ||||||
Change in working capital items | 42,535 | 182,850 | ||||||
Net cash used in operating activities | (1,406,528 | ) | (1,791,095 | ) | ||||
Net cash used in investing activities | - | - | ||||||
Net cash provided by financing activities | 305,742 | 2,911,775 | ||||||
Effect of exchange rate changes on cash and cash equivalents | 7,176 | 58,608 | ||||||
Net change in cash and cash equivalents | (1,093,610 | ) | 1,179,288 | |||||
Cash and cash equivalents, beginning of period | 5,361,397 | 7,090,919 | ||||||
Cash and cash equivalents, end of period | $ | 4,267,787 | $ | 8,270,207 | ||||
SOURCE: Edesa Biotech
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FAQ
What funding did Edesa Biotech secure for their ARDS drug candidate EB05?
What are Edesa's plans for evaluating their drug EB05?
What study does Edesa intend to conduct for their anti-CXCL10 monoclonal antibody?
What financial results did Edesa report for the quarter ended December 31, 2023?
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