Qualigen Therapeutics, Inc. Reports Year-End 2021 Financial Results

Rhea-AI Summary

Qualigen Therapeutics, Inc. (Nasdaq: QLGN) reported a 31% increase in revenue for the fiscal year ended December 31, 2021, totaling $5.65 million. This growth is attributed to increased sales and licensing from the diagnostics sector, especially from their FastPack rapid testing products. The company also regained worldwide distribution control over these products, enhancing revenue potential. In addition, Qualigen advanced its therapeutic pipeline through licensing QN-302, targeting pancreatic ductal adenocarcinoma. The company ended 2021 with $17.5 million in cash.

Positive

• 31% revenue increase to $5.65 million in FY 2021 versus FY 2020.
• 18% increase in net product sales to approximately $5.02 million.
• Enhanced profitability forecast from regaining distribution control over FastPack products.
• Positive advancements in therapeutic pipeline with QN-302 targeting high unmet clinical needs.

Negative

• Total operating expenses (SG&A + R&D) of approximately $24 million.
• Gross profit of only $0.7 million, indicating potential challenges in profitability.

CARLSBAD, Calif., April 01, 2022 (GLOBE NEWSWIRE) -- Qualigen Therapeutics, Inc. (Nasdaq: QLGN), a diversified life sciences company focused on developing treatments for adult and pediatric cancers with potential for Orphan Drug designation, while also commercializing diagnostics, today announces its financial results for the fiscal year ended December 31, 2021.

“Our financial results for 2021 are highlighted by a 31% increase in revenue over 2020 in our diagnostics business, which includes increased unit sales and license revenue from our China partner who seeks to both expand distribution and advance the technology of our flagship FastPack rapid testing products. As previously reported, as of April 1, 2022, Qualigen will reassume worldwide distribution and marketing control over sales of FastPack, which we forecast will lead to even greater revenue and per-unit profitability for this important part of Qualigen’s diversified life sciences strategy. We will continue to focus on expanding the reach of our rapid, accurate testing products, while investing in new diagnostic technologies that can position Qualigen ahead of future global health crises like we saw with Covid,” commented Michael S. Poirier, Qualigen’s Chairman and CEO.

Mr. Poirier continued, “During the fourth quarter of 2021 and early first quarter of 2022, we also advanced our therapeutic pipeline through our acquisition of the license to QN-302, a genomic quadruplex (G4)-selective transcription inhibitor being developed as a potential treatment for pancreatic ductal adenocarcinoma (PDAC), in addition to other tumors of high unmet clinical need. The G4 binding concept is derived from over 30 years in nucleic acid research, including that of G4s, which are higher order DNA and RNA structures formed by sequences containing quinine-rich repeats. Based on the strength of the technology underlying QN-302 and our belief that we can advance QN-302 more quickly into clinical trials than other products in our pipeline, QN-302 will lead our therapeutics program. We look forward to sharing more news on the program in the coming months.”

Fiscal Year 2021 Highlights

• Total revenue of $5.65 million, an increase of approximately 31% compared to the twelve months ended December 31, 2020
• Net product sales of approximately $5.02 million, an increase of approximately 18% compared to the twelve months ended December 31, 2020
• Cash position at December 31, 2021 of $17.5 million
  

Total revenues for Fiscal 2021 were $5.65 million compared to $4.31 million for the twelve months ended December 31, 2020, an increase of approximately $1.34 million, or 31%. This was primarily due to approximately $0.7 million in increased diagnostics product sales, as well the recognition of approximately $0.6 million in license revenue from the Yi Xin Technology Transfer Agreement.

Net product sales were primarily generated from sales of diagnostic tests. Net product sales for Fiscal 2021 were approximately $5.02 million, representing an increase of approximately 18% over the twelve months ended December 31, 2020. This improvement was primarily due to a recovery from the effects of the COVID-19 pandemic.

Gross profit on product sales during Fiscal 2021 was approximately $0.7 million, an increase of approximately $0.1 million, or 9%, compared to the twelve months of the prior year, primarily due to increased unit sales of diagnostic product, which resulted in economies of scale.

Selling, general and administrative expenses totaled approximately $12.3 million, and research and development expenses were $11.7 million during Fiscal 2021. As of December 31, 2021, the Company had approximately $17.5 million of cash.

About Qualigen Therapeutics, Inc.

Qualigen Therapeutics, Inc. is a diversified life sciences company focused on developing treatments for adult and pediatric cancers, as well as maintaining and expanding its core FDA-cleared FastPack^® System, which has been used successfully in diagnostics for over 20 years. Our investigational QN-302 compound is a small molecule selective transcription inhibitor with strong binding affinity to G4s prevalent in cancer cells; such binding could, by stabilizing the G4s against “unwinding,” help inhibit cancer cell proliferation. Our investigational QN-247 compound inhibits nucleolin, a key multi-functional regulatory protein that is overexpressed in cancer cells; QN-247 may thereby be able to inhibit the cells’ proliferation. QN-247 has shown promise in preclinical studies for the treatment of acute myeloid leukemia (AML). The investigational compounds within Qualigen’s RAS-F family of RAS oncogene protein-protein interaction inhibitor small molecules are believed to inhibit or block the binding of mutated RAS genes’ proteins to their effector proteins, thereby leaving the proteins from the mutated RAS unable to cause further harm. In theory, such mechanism of action may be effective in the treatment of about one quarter of all cancers, including certain forms of pancreatic, colorectal, and lung cancers. In addition to its oncology drug pipeline, Qualigen has an established diagnostics business which manufactures and distributes proprietary and highly accurate rapid blood testing systems to physician offices and small hospitals for the management of prostate cancer and other diseases and health conditions.

For more information about Qualigen Therapeutics, Inc., please visit www.qualigeninc.com.

Forward-Looking Statements

This news release contains forward-looking statements by the Company that involve risks and uncertainties and reflect the Company's judgment as of the date of this release. These statements include those related to the Company's prospects and strategy for the development of therapeutic drug candidates. Actual events or results may differ from the Company's expectations. For example, there can be no assurance that the Company will successfully develop any drugs (including QN-302, QN-247 and RAS-F); that preclinical or clinical development of the Company's drugs (including QN-302, QN-247 and RAS-F) will be completed on any projected timeline or will be successful; that any clinical trials will be approved to begin by or will proceed as contemplated by any projected timeline, or at all; that any future clinical trial data will be favorable or that such trials will confirm any improvements over other products or lack negative impacts; that any drugs will receive required regulatory approvals (or Fast Track designation or Orphan Drug status) or that they will be commercially successful; that patents will issue on the Company's owned and in-licensed patent applications; that such patents, if any, and the Company's currently owned and in-licensed patents would prevent competition; that the Company will be able to procure or earn sufficient working capital to complete the development, testing and launch of the Company's prospective therapeutic products (including QN-302, QN-247 and RAS-F); or that the Company will be able to maintain or expand market demand and/or market share for the Company's diagnostic products. The Company's stock price could be harmed if any of the events or trends contemplated by the forward-looking statements fails to occur or is delayed or if any actual future event otherwise differs from expectations. Additional information concerning these and other risk factors affecting the Company's business can be found in the Company's prior filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K, all of which are available at www.sec.gov. The Company disclaims any intent or obligation to update these forward-looking statements beyond the date of this news release, except as required by law. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Contact:

Jules Abraham
JQA Partners, Inc.
917-885-7378
jabraham@jqapartners.com

QUALIGEN THERAPEUTICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

		For the Year Ended December 31,			For the Nine Months Ended December 31,
		2021			2020
REVENUES
Net product sales		$	5,021,721		$	2,849,561
License revenue			632,004			—
Total revenues			5,653,725			2,849,561
EXPENSES
Cost of product sales			4,332,485			2,640,148
General and administrative			11,724,964			7,105,337
Research and development			11,716,718			3,316,099
Sales and marketing			542,594			307,903
Impairment loss on construction in progress			—			1,376,000
Total expenses			28,316,761			14,745,487
LOSS FROM OPERATIONS			(22,663,036	)		(11,895,926	)
OTHER (INCOME) EXPENSE, NET
(Gain) loss on change in fair value of warrant liabilities			(4,723,187	)		8,310,100
Gain on loan extinguishment			—			(451,345	)
Interest (income) expense, net			(42,693	)		48,039
Other income, net			(5,446	)		(256,354	)
Total other (income) expense, net			(4,771,326	)		7,650,440
LOSS BEFORE PROVISION FOR INCOME TAXES			(17,891,710	)		(19,546,366	)
PROVISION FOR INCOME TAXES			5,427			—
NET LOSS		$	(17,897,137	)	$	(19,546,366	)
Net loss per common share, basic and diluted		$	(0.61	)	$	(1.12	)
Weighted—average number of shares outstanding, basic and diluted			29,334,865			17,431,714

The accompanying notes are an integral part of these consolidated financial statements.

QUALIGEN THERAPEUTICS, INC.
CONSOLIDATED BALANCE SHEETS

	December 31,			December 31,
	2021			2020
ASSETS
Current assets
Cash	$	17,538,272		$	23,976,570
Accounts receivable, net		822,351			615,757
Inventory, net		1,055,878			953,458
Prepaid expenses and other current assets		1,379,896			2,678,894
Total current assets		20,796,397			28,224,679
Right-of-use assets		1,645,568			430,795
Property and equipment, net		203,920			247,323
Equipment held for lease, net		296			17,947
Intangible assets, net		171,190			187,694
Other assets		18,334			18,334
Total Assets	$	22,835,705		$	29,126,772
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	886,224		$	500,768
Accrued expenses and other current liabilities		1,793,901			746,738
Notes payable, current portion		—			131,766
Deferred revenue, current portion		135,063			486,031
Operating lease liability, current portion		134,091			254,739
Warrant liabilities		1,686,200			8,310,100
Total current liabilities		4,635,479			10,430,142
Notes payable, net of current portion		—			6,973
Operating lease liability, net of current portion		1,542,564			236,826
Deferred revenue, net of current portion		92,928			158,271
Total liabilities		6,270,970			10,832,212
Commitments and contingencies (Note 9)
Stockholders’ equity
Series Alpha convertible preferred stock, $0.001 par value; 7,000 shares authorized; 0 and 180 shares issued and outstanding as of December 31, 2021 and December 31, 2020		—			1
Common stock, $0.001 par value; 225,000,000 shares authorized; 35,290,178 and 27,296,061 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively		35,290			27,296
Additional paid-in capital		101,274,073			85,114,755
Accumulated deficit		(84,744,629	)		(66,847,492	)
Total stockholders' equity		16,564,734			18,294,560
Total Liabilities & Stockholders' Equity	$	22,835,705		$	29,126,772

The accompanying notes are an integral part of these consolidated financial statements.

The following table presents certain comparative transition period financial information for the year ended December 31, 2021 and the twelve months ended December 31, 2020, respectively.

		For the Twelve Months Ended December 31, 2021				For the Twelve Months Ended December 31, 2020 (unaudited)
Revenues		$	5,653,725			$	4,306,316
Gross profit on product sales		$	689,236			$	629,517
Net loss before income taxes		$	(17,891,710	)		$	(20,419,561	)
Net loss		$	(17,897,137	)		$	(20,421,979	)
Net loss per share – basic and fully diluted		$	(0.61	)		$	(1.17	)
Weighted average shares used in computing basic and diluted net loss per share			29,334,865				17,431,714

FAQ

What were Qualigen's revenue figures for FY 2021?

Qualigen's total revenue for FY 2021 was $5.65 million, a 31% increase from FY 2020.

How much cash did Qualigen have at the end of 2021?

Qualigen reported a cash position of $17.5 million as of December 31, 2021.

What is QN-302 and how does it relate to Qualigen's pipeline?

QN-302 is a potential treatment for pancreatic ductal adenocarcinoma, and it will lead Qualigen's therapeutics program.

What are the key factors contributing to Qualigen's revenue growth?

Key factors include increased sales in diagnostics and license revenue from their China partner.

How did the COVID-19 pandemic affect Qualigen's sales in FY 2021?

There was a recovery in sales, contributing to an 18% increase in net product sales, driven by diagnostic tests.