Kiora Pharmaceuticals Reports First Quarter Results; Update on Pipeline of Drugs Targeting Retinal Disease

Rhea-AI Summary

Kiora Pharmaceuticals, Inc. (NASDAQ: KPRX) reported strong Q1 2024 financial results and updates on its retinal disease treatment pipeline. With $31.3 million in cash, Kiora is well-positioned to advance KIO-301 and KIO-104 into mid-stage clinical trials. The partnership with Théa Open Innovation (TOI) allows for efficient capital allocation. KIO-301 targets inherited retinal disorders, while KIO-104 addresses retinal inflammatory diseases. Positive milestones include successful Phase 1 trials and a strategic partnership with TOI. Financially, Kiora ended Q1 2024 with $31.3 million in cash, $16 million in revenue, and a net income of $13.5 million.

Positive

• The strategic partnership with Théa Open Innovation (TOI) strengthens Kiora's cash position, enabling the advancement of key programs.

• KIO-301 and KIO-104 have the potential to address retinal disorders effectively, with promising clinical results.

• Milestones achieved include successful Phase 1 trials and a partnership with TOI, securing funding for future development.

• Kiora ended Q1 2024 with $31.3 million in cash, $16 million in revenue, and a net income of $13.5 million.

Negative

• Research and development expenses increased primarily due to a one-time licensing payment and reduced R&D tax credits.

• While revenue increased significantly, it was driven by collaboration revenue from the TOI partnership.

• Kiora will need to carefully manage expenses and milestones to ensure continued financial stability and growth.

Insights

Financial Analyst

Kiora Pharmaceuticals' financial results for Q1 2024 reflect a transformative period characterized by a substantial increase in cash reserves bolstered by both a strategic partnership and an equity offering. The partnership with Théa Open Innovation is particularly noteworthy as it not only secures an upfront payment but also promises additional inflows contingent on reaching certain development and commercial milestones. This alliance potentially defrays R&D costs and leverages Théa's expertise in ophthalmology. However, it is imperative for investors to consider the long investment horizon and inherent risks of clinical trials. The expected runway of over two years offers a buffer against immediate cash burn concerns. The significant net income growth, primarily driven by the TOI collaboration revenue, is a positive deviation from the prior year's net loss, signaling a strong quarter for Kiora. It's also worth mentioning the tiered royalty arrangement which could ensure a future steady income stream dependent on KIO-301's market performance.

Pharmaceuticals Market Analyst

The strategic focus on retinal diseases positions Kiora Pharmaceuticals at the cusp of addressing a substantial, yet underserved market. The reported progress and upcoming milestones for KIO-301 and KIO-104, targeting retinitis pigmentosa and retinal inflammation respectively, align with the industry's trend towards specialized therapies. KIO-301's double-masked, randomized controlled Phase 2 trial design aligns with the gold standard for clinical research, potentially bolstering its credibility and future regulatory prospects. The IND enabling work for KIO-104 and non-infectious uveitis clinical proof-of-concept are significant strides, promising but yet to be validated in the forthcoming Phase 2 trial. The market for these therapies is expected to grow, but Kiora's success will hinge on clinical outcomes, competitive landscape and their ability to scale operations post-trial.

Biotech Research Analyst

From a research and development perspective, Kiora's pipeline is promising, with KIO-301 showing potential based on the ABACUS-1 trial's fMRI results that link the therapy to an increase in neural activity in the brain's visual processing center. This neurological correlate of visual improvement is a breakthrough observation. The specificity of KIO-301's potential impact on inherited retinal disorders and KIO-104's mechanism of action for retinal inflammatory diseases could represent significant advancements in ophthalmology if the results are replicated in Phase 2 trials. The collaboration with Théa Open Innovation not only bolsters financial support but also infuses Kiora's pipeline with experienced oversight, potentially increasing the likelihood of clinical success. Nevertheless, it is important for stakeholders to remain cautious, as positive early-stage data does not guarantee success in later stages of clinical trials.

Phase 2 trial for KIO-301 for the treatment of retinitis pigmentosa, in partnership with Théa Open Innovation, expected to be initiated in Q4 2024

Phase 2 clinical trial for KIO-104 for retinal inflammation expected to begin in 2025

Ended Q1 2024 with $31.3 million in cash and cash equivalents, providing an expected runway of more than two years

Encinitas, California--(Newsfile Corp. - May 10, 2024) - Kiora Pharmaceuticals, Inc. (NASDAQ: KPRX) ("Kiora" or the "Company") announces first quarter 2024 financial results and updates on its development pipeline of treatments for retinal disease.

"Our balance sheet and strategic partnership with Théa Open Innovation (TOI) put us in a strong position to advance our two retinal programs, KIO-301 and KIO-104, into mid-stage clinical trials," said Brian M. Strem, Ph.D., chief executive officer of Kiora. "Both compounds, given their mechanisms of action, have the potential to address multiple diseases; KIO-301 for the treatment of inherited retinal disorders, and KIO-104 for the treatment of retinal inflammatory diseases. Our upcoming Phase 2 ABACUS-2 trial of KIO-301 for the treatment of retinitis pigmentosa, is a multi-center double-masked, randomized, controlled, multiple-dose study performed in collaboration with TOI.

"As part of our partnership, TOI will fund the remaining clinical development of KIO-301 across multiple indications, allowing us to efficiently invest our capital in the development of KIO-104 to treat retinal inflammatory diseases. KIO-104 may address the established need for eye treatments that spare the complications of chronic steroid use and/or systemic anti-inflammatory drugs. Clinical proof-of-concept for KIO-104 in the treatment of non-infectious uveitis, a rare retinal inflammatory condition, has been established with recently published results from a Phase 1/2a study. Prior to initiating a Phase 2 trial, we are conducting additional investigational new drug (IND) enabling work. Beyond non-infectious uveitis, the mechanism of action of KIO-104 could apply to other retinal conditions, such as macular edema, and proliferative vitreoretinopathy (PVR), a serious complication following retinal detachment repair."

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"In the first quarter, we executed a strategic partnership with TOI, which included a $16 million upfront payment, and raised $15 million from an equity offering," added Melissa Tosca, EVP Finance. "These developments substantially strengthened our cash position, allowing us to advance our two exciting programs while maintaining G&A expenses, and provides a runway of greater than two years. The TOI upfront payment was recognized entirely in the first quarter as collaboration revenue and we expect future development and regulatory milestone payments to be treated similarly."

Milestones achieved in the first quarter and year-to-date 2024 include the following:

KIO-301

• Entered a strategic partnership granting TOI exclusive worldwide co-development and commercialization rights, excluding Asia, to KIO-301 for the treatment of retinal degenerative diseases. Under the terms of the agreement, Kiora received an upfront payment of $16 million, recognized as collaboration revenue, and is eligible to receive up to an additional $285 million in development, regulatory, and commercial milestones; tiered royalties of up to low 20 percent on net sales; and full reimbursement of future KIO-301 research and development expenses.

• Reported quantitative functional MRI results at the Association of Research in Vision and Ophthalmology (ARVO) annual conference from ABACUS-1, showing a statistically significant increase in neural activity over baseline specifically within the brain's visual processing center. This increase in observed brain activity was time-dependent and concordant with previously reported improvements in visual field, visual acuity, and functional vision.

KIO-104

• Publication of results from a Phase 1 double-masked study of KIO-101 in the medical journal Pharmaceutics, documenting a 12-day treatment of KIO-101 topically at multiple doses was well tolerated in healthy volunteers and patients with inflammation of the eye. There was a significant decrease in conjunctival hyperemia in the treatment group compared to placebo.

• Initiated Investigational New Drug enabling preclinical work in support of planned phase 2 retinal inflammation clinical trial.

Kiora anticipates achieving the following clinical and regulatory milestones:

KIO-301 • Type D meeting with the FDA for functional vision endpoint • Initiate ABACUS-2 clinical trial • Begin design of additional inherited retinal disease studies	1H 2024 2H 2024 1H 2025
KIO-104 • Complete non-clinical package • Initiate Phase 2 clinical trial	2H 2024 1H 2025

 

Financial Results Highlights

Kiora ended the first quarter of 2024 with $31.3 million in cash and cash equivalents plus $1.8 million in research and development incentive tax credits and $0.2 million in collaboration receivables from TOI.

Revenue was $16.0 million for the first quarter of 2024, compared to no revenue in the first quarter of 2023. The revenue comes from collaboration revenue as part of an upfront payment from TOI connected to the strategic development and commercialization partnership.

Research and development expenses were $1.5 million, net of $0.2 million in offsetting credits related to expenses for KIO-301 which will be reimbursed by TOI, for the first quarter of 2024, compared to $0.4 million, net of $0.3 million in offsetting tax credits, for the first quarter of 2023. The increase was primarily due to a one-time licensing payment made to the University of California related to a sublicense fee of $0.7 million, and a decrease of $0.3 million in R&D tax credits due to reduced credit-eligible expenses given the KIO-301 expenses are now being reimbursed by TOI.

General and administrative expenses were $1.3 million for the first quarter of 2024, compared to $1.3 million for the first quarter of 2023.

Net income was $13.5 million for the first quarter of 2024 compared to a net loss of $1.9 million for the first quarter of 2023. The change in income is attributable to the recognition of $16 million in collaboration revenue.

About Kiora Pharmaceuticals

Kiora Pharmaceuticals is a clinical-stage biotechnology company developing and commercializing products for the treatment of orphan retinal diseases. KIO-301 is being developed for the treatment of retinitis pigmentosa, choroideremia, and Stargardt disease. It is a molecular photoswitch that has the potential to restore vision in patients with inherited and/or age-related retinal degeneration. KIO-104 is being developed for the treatment of posterior non-infectious uveitis. It is a next-generation, non-steroidal, immuno-modulatory, and small-molecule inhibitor of dihydroorotate dehydrogenase. In addition to news releases and SEC filings, we expect to post information on our website, www.kiorapharma.com, and social media accounts that could be relevant to investors. We encourage investors to follow us on Twitter and LinkedIn as well as to visit our website and/or subscribe to email alerts.

Forward-Looking Statements

Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements include statements relating to, among other things, Kiora's ability to execute on development and commercialization efforts and other regulatory or marketing approval efforts pertaining to Kiora's development-stage products, including KIO-104, KIO-301, KIO-201 and KIO-101, as well as the success thereof, with such approvals or success may not be obtained or achieved on a timely basis or at all, the sufficiency of existing cash on hand to fund operations for specific periods, the projected cash runway, the ability to timely complete planned initiatives for 2024, including phase 2 clinical development of KIO-301 and KIO-104, the potential for KIO-301 to be the first treatment options for patients with inherited degenerative diseases like RP, Kiora's plans to further fund development of KIO-104, the potential for KIO-104 to reduce inflammation, the timing of topline results from a Phase 2b trial of KIO-104, the potential for KIO-104 to apply to other retinal inflammatory diseases, and expected trends for research and development and general and administrative spending in 2024. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including, among other things, the ability to satisfy the closing conditions related to the offering ,the ability to conduct clinical trials on a timely basis, market and other conditions and certain risk factors described under the heading "Risk Factors" contained in Kiora's Annual Report on Form 10-K filed with the SEC on March 25, 2024 or described in Kiora's other public filings including on Form 10-Q filed with the SEC on May 10, 2024. Kiora's results may also be affected by factors of which Kiora is not currently aware. The forward-looking statements in this press release speak only as of the date of this press release. Kiora expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions, or circumstances on which any such statement is based, except as required by law.

CONDENSED CONSOLIDATED BALANCE SHEETS

		March 31, 2024 (unaudited)				December 31, 2023
ASSETS
Current Assets:
Cash and Cash Equivalents	$	31,276,330			$	2,454,684
Prepaid Expenses and Other Current Assets		206,671				233,382
Collaboration Receivables		189,905				—
Tax Receivables		1,808,787				2,049,965
Total Current Assets		33,481,693				4,738,031
Non-Current Assets:
Property and Equipment, Net		12,918				8,065
Restricted Cash		4,084				4,267
Intangible Assets and In-Process R&D, Net		8,807,600				8,813,850
Operating Lease Assets with Right-of-Use		94,298				106,890
Other Assets		39,414				40,767
Total Assets	$	42,440,007			$	13,711,870
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable	$	323,062			$	206,260
Accrued Expenses		1,222,078				1,380,666
Operating Lease Liabilities		47,851				47,069
Total Current Liabilities		1,592,991				1,633,995
Non-Current Liabilities:
Contingent Consideration		5,116,765				5,128,959
Deferred Tax Liability		779,440				779,440
Operating Lease Liabilities		46,448				59,822
Total Non-Current Liabilities		5,942,653				5,968,221
Total Liabilities		7,535,644				7,602,216
Commitments and Contingencies (Note 8)
Stockholders' Equity:
Preferred Stock, $0.01 Par Value: 10,000,000 shares authorized; 3,750 designated Series A, 0 shares issued and outstanding; 10,000 designated Series B, 0 shares issued and outstanding; 10,000 shares designated Series C, 0 shares issued and outstanding; 20,000 shares designated Series D, 7 shares issued and outstanding; 1,280 shares designated Series E, 0 shares issued and outstanding; 3,908 shares designated Series F, 420 issued and outstanding at March 31, 2024 and December 31, 2023, respectively		4				4
Common Stock, $0.01 Par Value: 50,000,000 shares authorized; 26,256,197 and 7,705,640 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively		262,584				77,078
Additional Paid-In Capital		168,429,797				153,192,228
Accumulated Deficit		(133,523,648	)			(146,976,855	)
Accumulated Other Comprehensive Loss		(264,374	)			(182,801	)
Total Stockholders' Equity		34,904,363				6,109,654
Total Liabilities and Stockholders' Equity	$	42,440,007			$	13,711,870

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
(unaudited)

		Three Months Ended March 31,
		2024				2023
Revenue:
Collaboration Revenue	$	16,000,000			$	—
Total Revenue		16,000,000				—
Operating Expenses:
General and Administrative		1,296,441				1,269,458
Research and Development		1,493,659				438,283
Change in Fair Value of Contingent Consideration		(12,194	)			208,926
Total Operating Expenses		2,777,906				1,916,667
Operating Income (Loss)		13,222,094				(1,916,667	)
Other Income, Net:
Interest Income, Net		223,047				33,465
Other Income, Net		8,066				14,666
Total Other Income, Net		231,113				48,131
Net Income (Loss)	$	13,453,207			$	(1,868,536	)
Net Income (Loss) per Common Share - Basic	$	0.52			$	(1.00	)
Weighted Average Shares Outstanding - Basic		25,936,163				1,863,466
Net Income (Loss) per Common Share - Diluted	$	0.38				(1.00	)
Weighted Average Shares Outstanding - Diluted		35,025,494				1,863,466
Other Comprehensive Income (Loss):
Net Income (Loss)	$	13,453,207			$	(1,868,536	)
Foreign Currency Translation Adjustments		(81,573	)			(32,671	)
Comprehensive Income (Loss)	$	13,371,634			$	(1,901,207	)

 

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FAQ

What is Kiora Pharmaceutical's stock symbol?

Kiora Pharmaceuticals' stock symbol is KPRX.

What are Kiora Pharmaceuticals' key retinal treatment programs?

Kiora Pharmaceuticals' key retinal treatment programs are KIO-301 for inherited retinal disorders and KIO-104 for retinal inflammatory diseases.

What were Kiora Pharmaceuticals' financial results for Q1 2024?

Kiora Pharmaceuticals ended Q1 2024 with $31.3 million in cash, $16 million in revenue, and a net income of $13.5 million.

What strategic partnership did Kiora Pharmaceuticals enter into in Q1 2024?

Kiora Pharmaceuticals entered into a strategic partnership with Théa Open Innovation (TOI), receiving an upfront payment of $16 million.

What are the future clinical and regulatory milestones for Kiora Pharmaceuticals' programs?

Kiora Pharmaceuticals aims to achieve milestones such as Type D meetings with the FDA, initiating ABACUS-2 trial for KIO-301, and beginning the design of additional inherited retinal disease studies.