InMed Pharmaceuticals Inc. (“InMed” or the
“Company”) (Nasdaq: INM), a leader in the pharmaceutical research,
development and manufacturing of rare cannabinoids and cannabinoid
analogs, today reported financial results for the fiscal year ended
June 30, 2022.
Conference Call & Webcast:Friday, September
23, 2022, at 10:00 AM Pacific Time, 01:00 PM Eastern
TimeRegistration Link:
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available for 12 months)
To access the call by phone, please go to the registration link
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15 minutes before the start of the call.
The Company’s full financial statements and
related MD&A for the fiscal year ended June 30, 2022, will be
available at www.inmedpharma.com and at www.sedar.com.
Eric A. Adams, InMed CEO, states, “In the final
quarter of our fiscal 2022, as well as throughout the previous
fiscal year, we have made important advancements in our
pharmaceutical drug development programs, including expanding our
Phase 2 clinical trial for the treatment of symptoms related to
epidermolysis bullosa to include adolescents, and initiating a
research collaboration agreement to further screen cannabinoid
analogs for potential therapeutic uses. As announced on September
8, 2022, we have made the decision reduce the efforts of our
subsidiary, BayMedica, to pursue commercialization of rare
cannabinoids in the health & wellness sector. Moving forward,
the Company is realigning its focus and resources towards advancing
our pharmaceutical drug development programs with the aim of
achieving important milestones in the coming quarters and
year.”
Business Update
Pharmaceutical Development
Programs
INM-755 for the treatment of
Epidermolysis Bullosa (“EB”)Enrollment and patient
treatment in the Company’s Phase 2 clinical trial, 755-201-EB,
continued throughout the fourth quarter and, to date, nine patients
been enrolled and completed treatment in the study. The 755-201-EB
study is designed to enroll up to 20 patients. InMed is evaluating
the safety of INM-755 (cannabinol) cream and its preliminary
efficacy in treating symptoms and wound healing over a 28-day
treatment period. This study marks the first time cannabinol
(“CBN”) has advanced to a Phase 2 clinical trial to be investigated
as a therapeutic option to treat a disease.
In the fiscal fourth quarter, based on the
safety data of the first five adult patients who completed
treatment with INM-755 CBN cream for the treatment of EB in the
Phase 2 clinical trial, an independent Data Monitoring Committee
(“DMC”) agreed it is safe to allow the enrollment of adolescent
patients, defined as persons aged twelve to seventeen. The first
adolescent patient with EB has been enrolled into the clinical
trial and has completed treatment at the clinical site in Greece
during the summer.
Following a period of downtime during the summer
months, patient screening and enrollment has now recommenced at
sites across Europe. The Company anticipates that the inclusion of
adolescents will have a positive impact on the enrollment rate for
the remainder of the clinical trial. Enrollment is anticipated to
complete during the calendar year 2022.
InMed’s Phase 2 clinical trial now has nine
clinical trial sites fully activated to screen and enroll patients.
Two more sites are expected to be fully activated soon. The
clinical trial is taking place in seven countries including
Austria, Germany, Greece, France, Italy, Israel and Spain.
INM-088 for the treatment of
glaucomaIn the fourth fiscal quarter, the Company
completed a pre-Investigational New Drug (“pIND”) application
discussion with the U.S. Food and Drug Administration (“FDA”)
regarding manufacturing, preclinical studies and early clinical
development plans for INM-088, a CBN formulation in development for
glaucoma. The Company gained alignment with FDA on the design of
the initial Phase 1-2 clinical trial to gather preliminary data on
the safety and efficacy of INM-088 treatment. Management expects to
file regulatory applications in the first half of the calendar year
2024 to initiate a human clinical trial.
As referenced in a recent international journal
publication [Biochimica et Biophysical Acta (BBA) - Molecular Basis
of Disease, Volume 1868, Issue 3, 1 March 2022, 166325],
InMed’s preclinical research demonstrates that CBN is effective at
providing neuroprotection to the retinal ganglion cells and
reducing intraocular pressure in glaucoma models, and outperformed
several other naturally occurring cannabinoids, including
tetrahydrocannabinol (“THC”).
New cannabinoid analogs and other
R&D programsAdvancing the research and development of
cannabinoid analogs remains a high priority for the Company. In
April 2022, the Company announced the publication of a patent
application in North America for several cannabinoid analogs. This
patent application, covering potentially hundreds of new chemical
entities, has broad claims directed to their molecular structure,
therapeutic uses and methods of manufacturing.
In addition, the Company also initiated a
research collaboration agreement with the Department of
Biotechnological and Applied Clinical Sciences, University of
L’Aquila (Italy) in the laboratory of Dr. Mauro Maccarrone. Dr.
Maccarrone’s lab will be screening the Company’s novel cannabinoid
analogs to investigate pharmacological properties and potential
therapeutic uses.
In April, BayMedica announced it will be
providing rare cannabinoids for use in Radicle Science, Inc.’s
Radicle Energy rare cannabinoid study to assess the effects of
delta-9 (“d-9”) dominant tetrahydrocannabivarin (“THCV”) on energy,
focus/attention, appetite and weight/BMI. BayMedica is supplying
its highly pure d-9 dominant THCV, formulated into a proprietary
lozenge manufactured by Trokie. The Study has been ongoing
throughout the summer and results are expected in October 2022.
The Company continues to advance discovery work
for the potential use of cannabinoid analogs to improve neuronal
function and provide neuroprotection for treating neurodegenerative
disorders such as Alzheimer’s disease, Parkinson’s disease and
Huntington’s disease. To date, screening for this indication has
yielded interesting analog candidates and the Company will continue
to proceed with its plan to find an appropriate compound for a
preclinical development program.
BayMedica commercial
activities
As previously announced on September 8, 2022,
the Company will be reducing its focus on the BayMedica commercial
business targeted to the health & wellness sector. BayMedica
will continue to explore potential opportunities for structured
supply agreements, commercial collaborations and review other
strategic alternatives for the commercial aspect of its
business. The research and development activities
focused on the generation of proprietary cannabinoid analogs to
support the Company’s pharmaceutical drug development programs will
continue at BayMedica.
Corporate
Subsequent to fiscal year end, Michael
Woudenberg was appointed Chief Operating Officer of the Company,
overseeing all day-to-day operations. Mr. Woudenberg was previously
Senior Vice President of Chemistry, Manufacturing and Controls and
has been an integral part of the executive team for the last four
years, supporting multiple functions within the organization.
In the second half of fiscal 2022 and during the
subsequent months, InMed and its BayMedica subsidiary implemented
significant cost saving measures, including some personnel changes.
These initiatives included a reduction in total headcount and
voluntary salary reductions for several members of management.
These changes have resulted in a reduction by approximately 25% of
the current workforce. This reduction in headcount, along with
other cost reduction initiatives, is expected to result in human
resource expense savings of approximately 30% on an annualized
basis. As part of these reductions, InMed President and CEO Eric A.
Adams volunteered a 28% reduction in salary as compared to the
previous year. Also, as part of these expense reduction
initiatives, no employee received an annual performance bonus for
fiscal year 2022.
Along with ongoing cost saving initiatives, in
the fourth quarter and subsequent months, the Company successfully
conducted a series of financing events to further capitalize the
Company and its ongoing development programs. In June 2022, the
Company closed a registered direct offering and concurrent private
placement for total proceeds of approximately $5 million. In August
2022, the Company announced a share consolidation of 1:25 in order
to regain compliance with Nasdaq's continued listing requirements
and subsequently received notification of compliance on September
21, 2022 from the exchange. Most recently, on September 13, 2022,
the Company closed an additional $6 million private placement with
two healthcare-focused institutional investors.
Financial and Operational
Highlights:
For the year ended June 30, 2022, the Company
recorded a net loss of $18.6 million, or $33.17 per share, compared
with a net loss of $10.2 million or $37.96 per share, for the
previous year.
Research and development and patents expenses
were $7.3 million for year ended June 30, 2022, compared with $5.3
million for the year ended June 30, 2021. The increase in research
and development and patents expenses was due to the inclusion of
BayMedica operating results following the acquisition date and due
to increased activities related to the INM-755 Phase 2 clinical
trial.
The Company incurred general and administrative
expenses of $6.9 million for the year ended June 30, 2022,
representing a 54% increase on the previous year. The increase is
due to the inclusion of BayMedica operating results following the
acquisition date, a combination of changes including investor
relations expenses, accounting fees and legal fees and
substantially higher insurance fees resulting from our listing on
the Nasdaq capital market.
The Company realized sales of $1.1 million in
our BayMedica segment for the year ended June 30, 2022, the result
of the manufacturing and sale of bulk rare cannabinoid products
following the acquisition of BayMedica in October 2021. As the year
ended June 30, 2021 predated the acquisition of BayMedica, there
are no comparable revenues in 2021.
As of June 30, 2022, the Company’s cash, cash
equivalents and short-term investments were $6.2 million.
Subsequent to the recent financing on September 13, 2022, the
Company has a current cash position of approximately $10 million.
Based on the current forecast, which is subject to potential
revisions in the future, the Company’s current cash reserves are
estimated to last into the second half of fiscal 2023, and possibly
into the first quarter of fiscal 2024, (being the third calendar
quarter of 2023), depending on the level and timing of realizing
revenues from the sale of BayMedica inventory as well as the level
and timing of the Company operating expenses.
As a result of the decision to refocus on its
core business in the pharmaceutical drug development area and
reduce efforts in BayMedica’s commercial business, the Company
incurred a non- cash impairment of intangible assets and goodwill
of $3.5 million in the BayMedica segment for the year ended June
30, 2022.
Outlook
As the Company enters fiscal 2023, management is
very encouraged by the strength of its pharmaceutical programs,
with several material milestones anticipated in the coming
quarters. Completing enrollment and concluding the Phase 2 clinical
trial in EB will be an important milestone for InMed and, if those
results are positive, may support potential partnerships for the
next development phases of the program. The Company also looks
forward to completing the remaining preclinical work on the
glaucoma program with the goal of moving into human trials in 2024.
Importantly, advancing to human trials in a disease indication with
a very large patient population like glaucoma will be a significant
development for the Company. Management looks forward to updating
investors over the coming months.
Table 1: Consolidated Balance
Sheets:
InMed Pharmaceuticals Inc. |
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
As at June
30, 2022 and 2021 |
|
|
Expressed in U.S. Dollars |
|
|
|
June 30, |
|
June 30, |
|
|
2022 |
|
2021 |
|
|
|
|
ASSETS |
$ |
|
$ |
|
Current |
|
|
Cash and cash equivalents |
6,176,866 |
|
7,363,126 |
|
Short-term investments |
44,804 |
|
46,462 |
|
Accounts receivable |
88,027 |
|
11,919 |
|
Inventories |
2,490,854 |
|
- |
|
Prepaids and other assets |
797,225 |
|
956,762 |
|
Total current assets |
9,597,776 |
|
8,378,269 |
|
|
|
|
Non-Current |
|
|
Property, equipment and ROU assets,
net |
904,252 |
|
326,595 |
|
Intangible assets, net |
2,108,915 |
|
1,061,697 |
|
Other assets |
176,637 |
|
14,655 |
|
Total Assets |
12,787,580 |
|
9,781,216 |
|
|
|
|
LIABILITIES AND SHAREHOLDERS'
EQUITY |
|
|
Current |
|
|
Accounts payable and accrued
liabilities |
2,415,265 |
|
2,134,878 |
|
Current portion of lease obligations |
404,276 |
|
80,483 |
|
Acquisition consideration payable |
500,000 |
|
- |
|
Total current liabilities |
3,319,541 |
|
2,215,361 |
|
|
|
|
Non-current |
|
|
Lease obligations |
389,498 |
|
189,288 |
|
Total Liabilities |
3,709,039 |
|
2,404,649 |
|
|
|
|
Shareholders' Equity |
|
|
Common shares, no par value, unlimited authorized
shares: |
|
|
650,667 (June 30, 2021 - 322,028) issued and
outstanding |
70,718,461 |
|
60,587,417 |
|
Additional paid-in capital |
31,684,098 |
|
21,513,051 |
|
Accumulated deficit |
(93,452,587 |
) |
(74,852,470 |
) |
Accumulated other comprehensive income |
128,569 |
|
128,569 |
|
Total Shareholders' Equity |
9,078,541 |
|
7,376,567 |
|
Total Liabilities and Shareholders'
Equity |
12,787,580 |
|
9,781,216 |
|
|
|
|
Table 2: Consolidated Statements of Operations and
Comprehensive Loss: |
|
|
|
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS |
|
For the year
ended June 30, 2022 and 2021 |
|
|
Expressed in U.S. Dollars |
|
|
|
Year Ended |
|
June
30 |
|
2022 |
|
2021 |
|
|
$ |
|
$ |
|
|
|
|
Sales |
1,089,435 |
|
- |
|
Cost of sales |
545,889 |
|
- |
|
Gross profit |
543,546 |
|
- |
|
|
|
|
Operating Expenses |
|
|
Research and development and patents |
7,282,615 |
|
5,338,084 |
|
General and administrative |
6,867,030 |
|
4,479,333 |
|
Amortization and depreciation |
185,657 |
|
120,866 |
|
Impairment of intangible assets and
goodwill |
3,472,593 |
|
- |
|
Total operating expenses |
17,807,895 |
|
9,938,283 |
|
|
|
|
Other Income (Expense) |
|
|
Interest and other income |
96,090 |
|
16,017 |
|
Finance expense |
- |
|
(360,350 |
) |
Unrealized gain on derivative warrants
liability |
- |
|
242,628 |
|
Warrant modification expense |
(1,314,307 |
) |
- |
|
Foreign exchange loss |
(117,551 |
) |
(163,101 |
) |
Net loss for the year |
(18,600,117 |
) |
(10,203,089 |
) |
|
|
|
Other Comprehensive Gain |
|
|
Foreign currency
translation gain |
- |
|
430,443 |
|
Total comprehensive loss for the
year |
(18,600,117 |
) |
(9,772,646 |
) |
|
|
|
Net loss per share for the
year |
|
|
Basic and
diluted |
(33.17 |
) |
(37.96 |
) |
Weighted average outstanding common
shares |
|
|
Basic and
diluted |
560,829 |
|
268,793 |
|
|
|
|
Table 3: Consolidated Statements of Cash
Flows: |
|
|
|
|
|
InMed Pharmaceuticals Inc. |
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
|
For the
years ended June 30, 2022 and 2021 |
|
|
Expressed in U.S. Dollars |
|
|
|
2022 |
|
2021 |
|
|
|
|
Cash provided by (used in): |
$ |
|
$ |
|
|
|
|
Operating Activities |
|
|
Net loss for
the period |
(18,600,117 |
) |
(10,203,089 |
) |
Items not
requiring cash: |
|
|
Amortization and depreciation |
185,657 |
|
120,866 |
|
Share-based compensation |
697,894 |
|
610,193 |
|
Shares issued for services |
79,879 |
|
- |
|
Amortization of right-of-use assets |
326,133 |
|
107,828 |
|
Loss on disposal of assets |
11,355 |
|
555 |
|
Interest income received on short-term
investments |
(115 |
) |
131 |
|
Unrealized gain on derivative warrants
liability |
- |
|
(242,628 |
) |
Unrealized foreign exchange loss |
1,770 |
|
(445 |
) |
Impairment of intangible assets and
goodwill |
3,472,593 |
|
- |
|
Payments on
lease obligations |
(341,862 |
) |
(93,951 |
) |
Finance
expense |
- |
|
360,350 |
|
Warrant
modification expense |
1,314,307 |
|
- |
|
Changes in
non-cash working capital: |
|
|
Inventories |
(2,003,732 |
) |
- |
|
Prepaids and other assets |
190,661 |
|
(823,172 |
) |
Other non-current assets |
(61,432 |
) |
(14,161 |
) |
Accounts receivable |
(40,008 |
) |
40,198 |
|
Accounts payable and accrued
liabilities |
(811,599 |
) |
346,685 |
|
Deferred revenue |
(5,142 |
) |
- |
|
Total cash used in operating
activities |
(15,583,758 |
) |
(9,790,640 |
) |
|
|
|
Investing Activities |
|
|
Cash acquired from acqusition of
BayMedica |
91,566 |
|
- |
|
Acquisition consideration payable |
(300,457 |
) |
- |
|
Purchase of property and equipment |
(39,108 |
) |
(1,725 |
) |
Loan receivable |
(425,000 |
) |
- |
|
Total cash used in investing
activities |
(672,999 |
) |
(1,725 |
) |
|
|
|
Financing Activities |
|
|
Shares issued for cash |
17,146,114 |
|
12,472,500 |
|
Share issuance costs |
(1,784,791 |
) |
(1,617,778 |
) |
Repayment of debt |
(290,826 |
) |
- |
|
Total cash provided by financing
activities |
15,070,497 |
|
10,854,722 |
|
Effects of foreign exchange on cash and cash
equivalents |
- |
|
494,960 |
|
Increase (decrease) in cash during the
period |
(1,186,260 |
) |
1,557,317 |
|
Cash and cash equivalents beginning of the
period |
7,363,126 |
|
5,805,809 |
|
Cash and cash equivalents end of the
period |
6,176,866 |
|
7,363,126 |
|
|
|
|
About InMed: InMed
Pharmaceuticals is a global leader in the pharmaceutical research,
development and manufacturing of rare cannabinoids and cannabinoid
analogs, including clinical and preclinical programs targeting
the treatment of diseases with high unmet medical needs. We
also have significant know-how in developing proprietary
manufacturing approaches to produce cannabinoids for various market
sectors. For more information, visit www.inmedpharma.com and
www.baymedica.com.
Investor Contact: Colin ClancyVice President,
Investor RelationsT: +1.604.416.0999E: cclancy@inmedpharma.com
Cautionary Note Regarding Forward-Looking
Information:
This news release contains "forward-looking
information" and "forward-looking statements" (collectively,
"forward-looking information") within the meaning of applicable
securities laws. Forward-looking information is based on
management's current expectations and beliefs and is subject to a
number of risks and uncertainties that could cause actual results
to differ materially from those described in the forward-looking
statements. Forward-looking information in this news release
includes statements about: initiating a research collaboration
agreement to further screen cannabinoid analogs for potential
therapeutic uses: realigning its focus and resources towards
advancing its pharmaceutical drug development programs with the aim
of achieving important milestones in the coming quarters and year;
evaluating the safety of INM-755 (cannabinol) cream and its
preliminary efficacy in treating symptoms and wound healing over a
28-day treatment period; anticipating that the inclusion of
adolescents will have a positive impact on the enrollment rate for
the remainder of the clinical trial; enrollment is anticipated to
complete during the calendar year 2022; expectation for two more
sites to be fully activated soon; expecting to file regulatory
applications in the first half of the calendar year 2024 to
initiate a human clinical trial; advancing the research and
development of cannabinoid analogs remains a high priority for the
Company; the analog patent application, potentially covering
hundreds of new chemical entities, having broad claims directed to
their molecular structure, therapeutic uses and methods of
manufacturing; the screening the Company’s novel cannabinoid
analogs to investigate pharmacological properties and potential
therapeutic uses; advancing discovery work for the potential use of
cannabinoid analogs to improve neuronal function and provide
neuroprotection for treating neurodegenerative disorders;
continuing to proceed with our plan to find an appropriate compound
for a preclinical development program; continuing to explore
potential opportunities for structured supply agreements,
commercial collaborations and review other strategic alternatives
for the commercial aspect of its business; continuing research and
development activities focused on the generation of proprietary
cannabinoid analogs to support the Company’s pharmaceutical drug
development programs; implementing significant cost saving measures
in an effort to streamline operations; reduction in headcount,
along with other cost reduction initiatives, is expected to result
in human resource cost savings of approximately 30% on an
annualized basis; current forecast, which is subject to potential
revisions in the future, the Company’s current cash reserves are
estimated to last into the second half of fiscal 2023, and possibly
into the first quarter of fiscal 2024; being encouraged by the
strength of its pharmaceutical programs, with several material
milestones anticipated in the coming quarters; the potential for
partnerships for the next development phases of the EB program if
Phase 2 results are positive.
With respect to the forward-looking information
contained in this news release, InMed has made numerous
assumptions. While InMed considers these assumptions to be
reasonable, these assumptions are inherently subject to significant
business, economic, competitive, market and social uncertainties
and contingencies.
Additionally, there are known and unknown risk
factors which could cause InMed's actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking information contained herein. A complete discussion
of the risks and uncertainties facing InMed’s stand-alone business
is disclosed in InMed’s Annual Report on Form 10-K and other
filings with the Securities and Exchange Commission on
www.sec.gov.
All forward-looking information herein is
qualified in its entirety by this cautionary statement, and InMed
disclaims any obligation to revise or update any such
forward-looking information or to publicly announce the result of
any revisions to any of the forward-looking information contained
herein to reflect future results, events or developments, except as
required by law.
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