ZyVersa Therapeutics Reports Full Year 2023 Financial Results and Provides Business Update
- ZyVersa Therapeutics, Inc. (Nasdaq: ZVSA) is progressing well with its lead candidates, Cholesterol Efflux MediatorTM VAR 200 and Inflammasome ASC Inhibitor IC 100.
- The company is on track to start a Phase 2a clinical trial for diabetic kidney disease in the first half of 2024.
- ZyVersa plans to submit an Investigational New Drug (IND) for IC 100 by the end of 2024, followed by a Phase 1 clinical trial.
- Financially, ZyVersa reported a net loss of $98.3 million for 2023, mainly due to impairments in research and development.
- Despite the financial challenges, ZyVersa is optimistic about its future and aims to secure additional financing to support its operations.
- ZyVersa reported significant net losses for 2023, totaling $98.3 million, primarily due to impairments in research and development.
- The company's pre-tax losses for 2023 increased to $107.8 million compared to $14.9 million in the previous period.
- ZyVersa's cash reserves of $3.1 million as of December 31, 2023, may not be sufficient to fund its operations, necessitating additional financing.
Insights
The financial results reported by ZyVersa Therapeutics, Inc. indicate a substantial increase in net losses from $14.1 million in the 2022 Period to $98.3 million in the 2023 Period. This significant rise in losses is attributed to the impairment of in-process research and development and goodwill, which are non-cash charges reflecting a decrease in the estimated future cash flows from these assets. The decline in stock value and market capitalization during the 2023 Period is a concerning signal to investors, as it may indicate a reevaluation of the company's growth prospects or market conditions that could affect future financing opportunities.
The company's current cash position of $3.1 million is alarming, considering the monthly burn rate and the need for additional financing to continue operations. The reported decrease in research and development expenses could reflect a strategic allocation of resources towards clinical trials and regulatory submissions, which are critical milestones for the company. However, the increase in general and administrative expenses, particularly due to costs associated with being a public company, could strain the financial resources further if not balanced with successful capital raising efforts.
Investors should monitor the progress of ZyVersa's clinical trials and the success of financing initiatives, as these will be pivotal in determining the company's ability to sustain operations and realize the potential of its drug candidates. The reliance on external financing, such as equity or debt offerings, may dilute current shareholders but is essential for the company's survival and advancement of its clinical programs.
ZyVersa's advancement into Phase 2a clinical trials for VAR 200 in diabetic kidney disease represents a critical step in the drug's development pathway. Diabetic kidney disease is a prevalent complication of diabetes with limited treatment options, making this an area of high unmet medical need. The potential expansion of IC 100's indications to include Parkinson’s disease, atherosclerosis and obesity further underscores the strategic focus on inflammasome-mediated inflammatory diseases, which are increasingly recognized as targets for novel therapeutic interventions.
The support from The Michael J. Fox Foundation for Parkinson’s Research not only provides financial backing but also validation for IC 100's potential in neurodegenerative diseases. The foundation's suggestion to apply for a second grant could be indicative of the promising results obtained thus far. However, the transition from preclinical to clinical stages is fraught with risk and many compounds fail to demonstrate efficacy or safety in humans despite promising animal model data.
Stakeholders should consider the scientific merit of ZyVersa's drug candidates, but also remain cautious of the inherent risks in drug development. Success in clinical trials could significantly enhance the company's valuation and attract partnership opportunities, while failure could lead to further financial strain and jeopardize the company's future.
The biopharmaceutical sector is highly competitive, with many companies vying for market share in the treatment of renal and inflammatory diseases. ZyVersa's focus on first-in-class drugs positions it within a niche segment that could command premium pricing and market exclusivity if the drugs prove to be effective and safe. The collaborations with academic institutions and the funding from a reputable foundation like MJFF can be seen as strategic moves to bolster the company's research credibility and possibly expedite the drug development process.
However, the market's reaction to ZyVersa's financial results and clinical progress will be contingent on the outcomes of the upcoming clinical trials and the company's ability to secure the necessary financing to reach those milestones. Investors will be keenly watching these developments, as they could significantly influence the stock's performance. The biopharmaceutical industry's reliance on milestones and data readouts means that ZyVersa's stock could experience volatility as each new piece of information is released.
While the potential for ZyVersa's drug candidates is evident, the company's valuation will likely reflect the balance between the risks associated with clinical development and the commercial potential of its pipeline. The ability to manage cash burn and secure financing will be as critical as the clinical outcomes in determining the company's trajectory.
Key Highlights:
- Cholesterol Efflux MediatorTM VAR 200 on target to begin Phase 2a clinical trial in patients with diabetic kidney disease H1-2024.
- Inflammasome ASC Inhibitor IC 100 preclinical program nearing completion, with planned Investigational New Drug (IND) submission Q4-2024, and Phase 1 clinical trial initiation shortly thereafter.
- Inflammasome ASC Inhibitor IC 100 preclinical research funded by The Michael J. Fox Foundation for Parkinson’s Research (MJFF) nearing completion, with potential for a second MJFF grant for further research.
- Scientific collaboration to assess Inflammasome ASC Inhibitor IC 100 as a potential treatment for atherosclerosis expected to conclude H1-2024.
- Scientific collaboration to assess Inflammasome ASC Inhibitor IC 100 as a potential treatment for obesity and metabolic syndrome expected to begin Q2-2024.
WESTON, Fla., March 25, 2024 (GLOBE NEWSWIRE) -- ZyVersa Therapeutics, Inc. (Nasdaq: ZVSA, or “ZyVersa”), a clinical-stage specialty biopharmaceutical company developing first-in-class drugs for the treatment of renal and inflammatory diseases with high unmet medical needs, reports financial results for full year ending December 31, 2023, and provides business update.
“Throughout 2023 and early 2024, ZyVersa achieved considerable progress in advancing development of our two lead candidates. A Phase 2a clinical trial with Cholesterol Efflux MediatorTM VAR 200 is on target to be initiated in the first half of this year in patients with diabetic kidney disease; preclinical studies for indication expansion are underway for Parkinson’s disease, atherosclerosis, and obesity with Inflammasome ASC Inhibitor IC 100; and IND submission for IC 100 is expected by end of the year,” stated Stephen C. Glover, ZyVersa’s Co-founder, Chairman, CEO, and President. “We view 2024 as a potentially transformative year for the company based on the value-building milestones that we expect to achieve over the next 12 to 15 months. I look forward to working with my leadership team and fellow Board members to execute a business and clinical strategy that has potential to position ZyVersa as a leading, innovative company developing transformative drugs for underserved patients with renal and inflammasome-mediated inflammatory diseases.”
BUSINESS Update
CHOLESTEROL EFFLUX MEDIATORTM VAR 200 FOR RENAL DISEASE
- Phase 2a clinical trial in patients with diabetic kidney disease is on target to begin in the first half of 2024.
- CRO, George Clinical was engaged in December 2023 to initiate and manage the trial.
- An IND amendment to study diabetic kidney disease was filed on February 16, 2024.
- A central Institutional Review Board (IRB) approved the clinical trial protocol for trial initiation.
INFLAMMASOME ASC INHIBITOR IC 100 FOR INFLAMMATORY DISEASES
- Inflammasome ASC Inhibitor IC 100’s preclinical program is nearing completion, with a planned IND submission in Q4-2024, followed by initiation of a Phase 1 clinical trial shortly thereafter.
- Preclinical research funded by MJFF and conducted by researchers at University of Miami Miller School of Medicine to determine the potential of Inflammasome ASC Inhibitor IC 100 to block the damaging neuroinflammation that induces neural degeneration in Parkinson’s disease is nearing completion.
- Research update and key findings were provided to MJFF project team on March 8, 2024.
- Based on the findings, the MJFF project team suggested that the team apply for a second grant to further the research in an established animal model.
- A scientific collaboration was initiated with an undisclosed partner to assess the potential of Inflammasome ASC Inhibitor IC 100 as a treatment for atherosclerosis in a well-established animal model.
- Study is expected to conclude in H1-2024.
- A scientific collaboration with inflammasome and neurology experts at University of Miami Miller School of Medicine to assess the potential of Inflammasome ASC Inhibitor IC 100 as a treatment for obesity and metabolic syndrome is expected to begin in Q2-2024.
YEAR END 2023 FINANCIAL RESULTS
Net losses were
Pre-tax losses were
Based on its current operating plan, ZyVersa expects its cash of
Research and development expenses for the 2023 Period were
General and administrative expenses for the 2023 Period were
About ZyVersa Therapeutics, Inc.
ZyVersa (Nasdaq: ZVSA) is a clinical stage specialty biopharmaceutical company leveraging advanced, proprietary technologies to develop first-in-class drugs for patients with renal and inflammatory diseases who have significant unmet medical needs. The Company is currently advancing a therapeutic development pipeline with multiple programs built around its two proprietary technologies – Cholesterol Efflux Mediator™ VAR 200 for treatment of kidney diseases, and Inflammasome ASC Inhibitor IC 100, targeting damaging inflammation associated with numerous CNS and peripheral inflammatory diseases. For more information, please visit www.zyversa.com.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements contained in this press release regarding matters that are not historical facts, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These include statements regarding management’s intentions, plans, beliefs, expectations, or forecasts for the future, and, therefore, you are cautioned not to place undue reliance on them. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. ZyVersa Therapeutics, Inc. (“ZyVersa”) uses words such as “anticipates,” “believes,” “plans,” “expects,” “projects,” “future,” “intends,” “may,” “will,” “should,” “could,” “estimates,” “predicts,” “potential,” “continue,” “guidance,” and similar expressions to identify these forward-looking statements that are intended to be covered by the safe-harbor provisions. Such forward-looking statements are based on ZyVersa’s expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied in the statements due to a number of factors, including ZyVersa’s plans to develop and commercialize its product candidates, the timing of initiation of ZyVersa’s planned preclinical and clinical trials; the timing of the availability of data from ZyVersa’s preclinical and clinical trials; the timing of any planned investigational new drug application or new drug application; ZyVersa’s plans to research, develop, and commercialize its current and future product candidates; the clinical utility, potential benefits and market acceptance of ZyVersa’s product candidates; ZyVersa’s commercialization, marketing and manufacturing capabilities and strategy; ZyVersa’s ability to protect its intellectual property position; and ZyVersa’s estimates regarding future revenue, expenses, capital requirements and need for additional financing.
New factors emerge from time-to-time, and it is not possible for ZyVersa to predict all such factors, nor can ZyVersa assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements included in this press release are based on information available to ZyVersa as of the date of this press release. ZyVersa disclaims any obligation to update such forward-looking statements to reflect events or circumstances after the date of this press release, except as required by applicable law.
This press release does not constitute an offer to sell, or the solicitation of an offer to buy, any securities.
Corporate, Media, IR Contact
Karen Cashmere
Chief Commercial Officer
kcashmere@zyversa.com
786-251-9641
| ZYVERSA THERAPEUTICS, INC. | |||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||
| Successor | |||||||||||
| December 31, | |||||||||||
| 2023 | 2022 | ||||||||||
| Assets | |||||||||||
| Current Assets: | |||||||||||
| Cash | $ | 3,137,674 | $ | 5,902,199 | |||||||
| Prepaid expenses and other current assets | 215,459 | 225,347 | |||||||||
| Vendor deposits | - | 235,000 | |||||||||
| Total Current Assets | 3,353,133 | 6,362,546 | |||||||||
| Equipment, net | 6,933 | 17,333 | |||||||||
| In-process research and development | 18,647,903 | 100,086,329 | |||||||||
| Goodwill | - | 11,895,033 | |||||||||
| Security deposit | 98,476 | 46,659 | |||||||||
| Operating lease right-of-use asset | 7,839 | 98,371 | |||||||||
| Total Assets | $ | 22,114,284 | $ | 118,506,271 | |||||||
| Liabilities, Temporary Equity and Stockholders' Equity | |||||||||||
| Current Liabilities: | |||||||||||
| Accounts payable | $ | 8,431,583 | $ | 6,025,645 | |||||||
| Accrued expenses and other current liabilities | 1,754,533 | 2,053,559 | |||||||||
| Operating lease liability | 8,656 | 108,756 | |||||||||
| Total Current Liabilities | 10,194,772 | 8,187,960 | |||||||||
| Deferred tax liability | 844,914 | 10,323,983 | |||||||||
| Total Liabilities | 11,039,686 | 18,511,943 | |||||||||
| Commitments and contingencies | |||||||||||
| Redeemable common stock, subject to possible redemption, | |||||||||||
| 0 and 1,880 shares outstanding as of December 31, 2023 and | |||||||||||
| 2022, respectively | - | 331,331 | |||||||||
| Stockholders' Equity: | |||||||||||
| Preferred stock, | |||||||||||
| Series A preferred stock, 8,635 shares designated, 50 and 8,635 shares issued | |||||||||||
| and outstanding as of December 31, 2023 and 2022, respectively | - | 1 | |||||||||
| Series B preferred stock, 5,062 shares designated, 5,062 shares issued | |||||||||||
| and outstanding as of December 31, 2023 and 2022, respectively | 1 | 1 | |||||||||
| Common stock, | |||||||||||
| 4,052,119 and 257,604 shares issued at December 31, 2023 and 2022, | |||||||||||
| respectively, and 4,052,057 and 257,604 shares outstanding as of | |||||||||||
| December 31, 2023 and 2022, respectively | 405 | 26 | |||||||||
| Additional paid-in-capital | 114,300,484 | 104,584,147 | |||||||||
| Accumulated deficit | (103,219,124 | ) | (4,921,178 | ) | |||||||
| Treasury stock, at cost, 62 and 0 shares at December 31, 2023 | |||||||||||
| and 2022, respectively | (7,168 | ) | - | ||||||||
| Total Stockholders' Equity | 11,074,598 | 99,662,997 | |||||||||
| Total Liabilities, Temporary Equity and Stockholders' Equity | $ | 22,114,284 | $ | 118,506,271 | |||||||
| ZYVERSA THERAPEUTICS, INC. | |||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
| Successor | Predecessor | ||||||||||||||
| For the | For the period | For the period | |||||||||||||
| Year Ended | December 13 through | January 1 through | |||||||||||||
| December 31, | December 31, | December 12, | |||||||||||||
| 2023 | 2022 | 2022 | |||||||||||||
| Operating Expenses: | |||||||||||||||
| Research and development | $ | 3,207,573 | $ | 399,894 | $ | 5,407,859 | |||||||||
| General and administrative | 11,213,201 | 420,174 | 7,605,205 | ||||||||||||
| Impairment of in-process research and development | 81,438,426 | - | - | ||||||||||||
| Impairment of goodwill | 11,895,033 | - | - | ||||||||||||
| Total Operating Expenses | 107,754,233 | 820,068 | 13,013,064 | ||||||||||||
| Loss From Operations | (107,754,233 | ) | (820,068 | ) | (13,013,064 | ) | |||||||||
| Other (Income) Expense: | |||||||||||||||
| Interest (income) expense | (457 | ) | - | 427,542 | |||||||||||
| Change in fair value of derivative liabilities | - | - | 607,001 | ||||||||||||
| Pre-Tax Net Loss | (107,753,776 | ) | (820,068 | ) | (14,047,607 | ) | |||||||||
| Income tax benefit | 9,455,830 | 745,050 | - | ||||||||||||
| Net Loss | (98,297,946 | ) | (75,018 | ) | (14,047,607 | ) | |||||||||
| Deemed dividend to preferred stockholders | (7,948,209 | ) | - | (10,015,837 | ) | ||||||||||
| Net Loss Attributable to Common Stockholders | $ | (106,246,155 | ) | $ | (75,018 | ) | $ | (24,063,444 | ) | ||||||
| Net Loss Per Share | |||||||||||||||
| - Basic and Diluted | $ | (108.97 | ) | $ | (0.29 | ) | $ | (0.99 | ) | ||||||
| Weighted Average Number of | |||||||||||||||
| Common Shares Outstanding | |||||||||||||||
| - Basic and Diluted | 975,035 | 257,604 | 24,194,270 | ||||||||||||
FAQ
When will ZyVersa begin the Phase 2a clinical trial for diabetic kidney disease with VAR 200?
What is the planned timeline for submitting an Investigational New Drug (IND) for IC 100?
How much was ZyVersa's net loss for the year ended December 31, 2023?
Why did ZyVersa report higher net losses for 2023 compared to the previous year?
What are ZyVersa's plans to secure additional financing for its operations?
