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| 8-K - CURRENT REPORT - Edesa Biotech, Inc. | edsa_8k.htm |
Exhibit 99.1
Edesa Biotech Reports Fiscal 2nd Quarter 2021 Results
TORONTO,
ON / ACCESSWIRE / May 14, 2021 / Edesa Biotech, Inc.
(Nasdaq:EDSA), a clinical-stage biopharmaceutical company focused
on inflammatory and immune-related diseases, today reported
financial results for the three and six months ended March 31, 2021
and provided an update on its business.
The
company reported that it has enrolled more than 285 patients in an
ongoing Phase 2/3 clinical study of its investigational drug, EB05,
as a single-dose treatment for hospitalized COVID-19 patients with
or at risk of developing Acute Respiratory Distress Syndrome
(ARDS). ARDS is the leading cause of death in COVID-19 patients.
The study is being funded in part by a C$14 million reimbursement
grant from the Canadian Government. In addition, Edesa completed
enrollment of the first cohort of a Phase 2b clinical study
evaluating another drug candidate, EB01, as a monotherapy for
chronic Allergic Contact Dermatitis. The company is currently
performing a blinded interim analysis on EB01. Edesa recently
expanded its global rights to the technology that forms the basis
of EB01 for all fields of use in humans and animals. During the
second fiscal quarter, Edesa raised net cash proceeds of
approximately $12.1 million from equity financings and
warrant/option exercises.
"We
achieved another quarter of positive momentum, highlighted by key
enrollment milestones in two separate clinical programs, the award
of a C$14 million competitive grant announced by the Prime Minister
of Canada, and the completion of an over-subscribed equity
offering. While the results of our clinical studies will be
data-driven, and are subject to regulatory review, we are already
preparing to be in position to rapidly advance these studies should
the interim results be positive and get these promising treatments
in the hands of physicians. With these projects and initiatives in
mind, we believe 2021 could be a transformative year for the
company,” said Dr. Par Nijhawan, Chief Executive Officer of
Edesa Biotech.
Edesa's
Chief Financial Officer Kathi Niffenegger reported that working
capital was significantly bolstered by the federal reimbursement
grant and equity financings. At March
31, 2021, Edesa had working capital of $16.80 million. Cash and
cash equivalents totaled $10.97 million. Research and development
expenditures have largely tracked the company’s accelerated
clinical progress.
“We have recorded cash reimbursements of approximately $7.2
million under our federal grant. This has allowed us to advance our
ARDS project more quickly and significantly offset development
costs,” said Ms. Niffenegger.
She
added, “In the second fiscal quarter, research and
development expenditures have been driven by the achievement of
development milestones and drug product costs, and have generally
shifted earlier than originally estimated due to the rapid pace of
enrollment and related activities in our two ongoing clinical
trials. Overall project expenditures have been in line with
management’s expectations.”
Financial Results for the Three Months Ended March 31,
2021
There were no revenues for the three months ended March 31, 2021
compared to $0.11 million for the three months ended March 31,
2020, reflecting the winddown and discontinuation of sales of
product inventory from legacy operations.
Total operating expenses increased by $7.88 million to $9.51
million for the three months ended March 31, 2021 compared to $1.63
million for the same period last year:
●
Research
and development expenses increased by $7.48 million to $7.98
million for the three months ended March 31, 2021 compared to $0.50
million for the same period last year primarily due to milestone
payments related to advancement of the company’s EB05
clinical program, increased external research expenses related to
accelerated activity in ongoing clinical studies, increased
investigational drug product expenses and an increase in non-cash
share-based compensation. Higher salary and related personnel
expenses, increased employee headcount and patent fees also
contributed to the increase.
●
General
and administrative expenses increased by $0.43 million to $1.54
million for the three months ended March 31, 2021 compared to $1.11
million for the same period last year primarily as a result of
higher salary and related personnel expenses. Higher legal and
other professional services also contributed to the
increase.
Total other income increased by $7.22 million to $7.25 million for
the three months ended March 31, 2021 compared to $0.03 million for
the same period last year primarily due to increased grant income
related to the initiation of reimbursements under the
company’s federal grant with the Canadian government’s
Strategic Innovation Fund.
For the three months ended March 31, 2021, Edesa reported a net
loss of $2.26 million, or $0.19 per common share, compared to a net
loss of $1.49 million, or $0.17 per common share, for the three
months ended March 31, 2020.
Financial Results for the Six Months Ended March 31,
2021
There were no revenues for the six months ended March 31, 2021
compared to $0.22 million for the six months ended March 31,2020,
reflecting the winddown and discontinuation of sales of product
inventory from legacy operations.
Total operating expenses increased by $9.28 million to $12.12
million for the six months ended March 31, 2021 compared to $2.84
million for the same period last year:
●
Research
and development expenses increased by $8.32 million to $9.35
million for the six months ended March 31, 2021 compared to $1.03
million for the same period last year primarily due to milestone
payments related to advancement of the company’s EB05
clinical program, increased external research expenses related to
accelerated activity in ongoing clinical studies, increased
investigational drug product expenses and an increase in non-cash
share-based compensation. Higher salary and related personnel
expenses, increased employee headcount and patent fees also
contributed to the increase.
●
General
and administrative expenses increased by $0.97 million to $2.77
million for the six months ended March 31, 2021 compared to $1.80
million for the same period last year primarily as a result of
higher salary and related personnel expenses, and non-cash
share-based compensation. Higher legal and other professional
services also contributed to the increase.
Total other income increased by $7.19 million to $7.23 million for
the six months ended March 31, 2021 compared to $0.04 million for
the same period last year primarily due to increased grant income
related to the initiation of reimbursements under the
company’s federal grant with the Canadian government’s
Strategic Innovation Fund.
For the six months ended March 31, 2021, Edesa reported a net loss
of $4.90 million, or $0.45 per common share, compared to a net loss
of $2.58 million, or $0.32 per common share, for the six months
ended March 31, 2020.
About Edesa Biotech, Inc.
Edesa Biotech, Inc. (Nasdaq:
EDSA) is a clinical-stage biopharmaceutical company focused on
developing innovative treatments for inflammatory and
immune-related diseases with clear unmet medical needs. The
company’s two lead product candidates, EB05 and EB01, are in
later stage clinical studies. EB05 is a monoclonal antibody therapy
that the company is developing as a treatment for Acute Respiratory
Distress Syndrome (ARDS). ARDS is a life-threatening form of
respiratory failure, and the leading cause of death among COVID-19
patients. Edesa is also developing an sPLA2 inhibitor, designated
as EB01, as a topical treatment for chronic allergic contact
dermatitis (ACD), a common, potentially debilitating condition and
occupational illness. EB01 employs a novel, non-steroidal mechanism
of action and in two clinical studies has demonstrated
statistically significant improvement of multiple symptoms in ACD
patients. The company is based in Markham, Ontario, Canada, with a
U.S. subsidiary located in Southern California. Sign up for
news
alerts.
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: upcoming milestones
in the company's clinical studies, including enrollment milestones
and interim readouts for its COVID-19 and dermatitis studies, the
company’s preparations to be in position to rapidly advance
its clinical studies and the company’s belief that 2021 could
be a transformative year. 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, such as COVID-19.
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.
(805) 488-2800 ext. 150
investors@edesabiotech.com
|
Condensed
Interim Consolidated Statements of Operations
|
||||
|
(Unaudited)
|
||||
|
|
|
|
|
|
|
|
Three Months
Ended
|
Six Months
Ended
|
||
|
|
March 31,
2021
|
March 31,
2020
|
March 31,
2021
|
March 31,
2020
|
|
|
|
|
|
|
|
Total Revenues
|
$-
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$110,516
|
$-
|
$218,316
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
Cost
of sales
|
-
|
10,037
|
-
|
13,815
|
|
Research
and development
|
7,975,304
|
502,814
|
9,354,958
|
1,030,812
|
|
General
and administrative
|
1,535,127
|
1,113,917
|
2,769,275
|
1,795,623
|
|
|
|
|
|
|
|
|
9,510,431
|
1,626,768
|
12,124,233
|
2,840,250
|
|
|
|
|
|
|
|
Loss from operations
|
(9,510,431)
|
(1,516,252)
|
(12,124,233)
|
(2,621,934)
|
|
|
|
|
|
|
|
Other Income (Loss):
|
|
|
|
|
|
Reimbursement
grant income
|
7,170,465
|
-
|
7,170,465
|
-
|
|
Other
income (loss)
|
80,779
|
26,616
|
56,969
|
38,765
|
|
|
|
|
|
|
|
Loss before income taxes
|
(2,259,187)
|
(1,489,636)
|
(4,896,799)
|
(2,583,169)
|
|
|
|
|
|
|
|
Income tax expense
|
800
|
-
|
800
|
800
|
|
|
|
|
|
|
|
Net loss
|
(2,259,987)
|
(1,489,636)
|
(4,897,599)
|
(2,583,969)
|
|
|
|
|
|
|
|
Exchange
differences on translation
|
(10,480)
|
(39,908)
|
92,947
|
(21,794)
|
|
|
|
|
|
|
|
Net comprehensive loss
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$(2,270,467)
|
$(1,529,544)
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$(4,804,652)
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$(2,605,763)
|
|
|
|
|
|
|
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Weighted
average number of common shares
|
11,641,201
|
8,740,065
|
10,894,441
|
8,118,891
|
|
|
|
|
|
|
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Loss per common share - basic and diluted
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$(0.19)
|
$(0.17)
|
$(0.45)
|
$(0.32)
|
|
Condensed
Interim Consolidated Balance Sheets
|
||
|
(Unaudited)
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||
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|
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|
|
March 31,
2021
|
September 30,
2020
|
|
|
|
|
|
Assets:
|
|
|
|
Cash and cash
equivalents
|
$10,966,194
|
$7,213,695
|
|
Other current
assets
|
10,452,165
|
890,323
|
|
Non-current
assets
|
2,583,331
|
2,658,357
|
|
|
|
|
|
Total
Assets
|
$24,001,690
|
$10,762,375
|
|
|
|
|
|
Liabilities,
shareholders' equity and temporary equity:
|
|
|
|
Current
liabilities
|
$4,620,135
|
$1,529,857
|
|
Noncurrent
liabilities
|
108,771
|
124,388
|
|
Temporary
equity
|
-
|
2,476,955
|
|
Shareholders'
equity
|
19,272,784
|
6,631,175
|
|
|
|
|
|
Total
liabilities, shareholders' equity and temporary equity
|
$24,001,690
|
$10,762,375
|
|
Condensed
Interim Consolidated Statements of Cash Flows
|
||
|
(Unaudited)
|
||
|
|
|
|
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Six Months
Ended
|
|
|
|
March 31,
2021
|
March 31,
2020
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
Net
loss
|
$(4,897,599)
|
$(2,583,969)
|
|
Adjustments
for non-cash items
|
1,248,994
|
393,829
|
|
Change
in working capital items
|
(6,541,452)
|
229,981
|
|
|
|
|
|
Net cash used in operating activities
|
(10,190,057)
|
(1,960,159)
|
|
|
|
|
|
Net cash provided by (used in) investing activities
|
(4,098)
|
42,359
|
|
|
|
|
|
Net cash provided by financing activities
|
13,937,798
|
3,891,801
|
|
|
|
|
|
Effect
of exchange rate changes on cash and cash equivalents
|
8,856
|
(14,654)
|
|
|
|
|
|
Increase
in cash and cash equivalents during the period
|
3,752,499
|
1,959,347
|
|
Cash
and cash equivalents, beginning of period
|
7,213,695
|
5,030,583
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
$10,966,194
|
$6,989,930
|