InMed Pharmaceuticals Inc. (“InMed” or the “Company”) (TSX:IN; OTCQX:IMLFF), a biopharmaceutical company developing a proprietary biosynthesis platform technology for the manufacturing of pharmaceutical-grade cannabinoids as well as an R&D pipeline of medications targeting diseases with high unmet medical needs, today reported financial results for the three and nine months ended March 31, 2019, which is the Company’s third quarter of fiscal year 2019 (“3Q19”).
Eric A. Adams, InMed’s President and Chief Executive Officer, commented, “The third quarter of fiscal year 2019 was all about execution: the team is firing on all cylinders, R&D milestones are being accomplished, and we remain enthusiastic about our scientific advancements. Further, our financial position remains strong and we are confident that our existing cash runway positions us to complete our forthcoming significant milestones – specifically to advance our INM-755 program for the treatment of epidermolysis bullosa (“EB”) through the completion of Phase I healthy volunteer studies, to advance our biosynthesis program in preliminary commercial scale-up activities, and to advance the glaucoma program through several pre-clinical studies.”
“During the third quarter,” Mr. Adams continued, “we transitioned our EB program to a single cannabinoid formulation, which is now referred to as INM-755. This was an important decision for the program, as we believe a single molecule product, instead of a combination product, will improve our overall probability of success, both in terms of clinical development as well as from a regulatory standpoint. In terms of our preparation for our Phase I study, we have finalized our selection of the service provider for our final sterile cream production.”
“With regard to our proprietary biosynthesis platform technology,” Mr. Adams continued, “we completed a number of important milestones and made meaningful advancements on several others:
— Completed the tech transfer from our collaboration partners at the University of British Columbia (“UBC”) to the National Research Council Canada (“NRC”) by successfully converting precursors into a specific cannabinoid using the appropriate DNA plasmid construct in E. coli.
— Initiated downstream process (“DSP”) activities involving purification of cannabinoids from the fermented material at a GMP-ready contract development and manufacturing operation (CDMO).
— Published the first in a series of pending patent applications directed to the Company’s biosynthesis platform technology for the manufacturing of pharmaceutical-grade cannabinoids. The first of which, entitled ‘METABOLIC ENGINEERING OF E. COLI FOR THE BIOSYNTHESIS OF CANNABINOID PRODUCTS’, addresses the enablement and maximization of cannabinoid production through optimization of the precursor substrates needed to support specific cannabinoid synthesis. This application and two more recently filed U.S. provisional patent applications cover various elements required to enable functional cannabinoid synthase production in an E. coli system.”
Mr. Adams continued, “In the near term, we expect to complete the fermentation optimization initiative, to complete the process development of the DSP and to scale-up fermentation batches towards commercial scale. Finally, we will continue to pursue various avenues to maximize the yields and to lower the costs of cannabinoid manufacturing.”
Results of Operations (expressed in Canadian Dollars):
— For 3Q19, the Company recorded a comprehensive net loss of $3.5 million, or $0.02 per share, compared with a comprehensive net loss of $2.1 million, or $0.01 per share, for the three months ended March 31, 2018 (“3Q18”).
— Research and development expenses were $1.6 million for 3Q19, compared with $0.6 million for 3Q18. The increase in research and development expenses in 3Q19 as compared to 3Q18 was primarily due to: (a) increased spending on research supplies for the purchase of active pharmaceutical ingredients to be used in the clinical trial for INM-755; (b) increased spending on external contractors for work associated with preclinical studies for INM-755 required for the regulatory application to initiate clinical trials for INM-755 in the second half of calendar year 2019; (c) increased spending on the Company’s biosynthesis program; and (d) increased R&D personnel compensation as a result of increased R&D staffing.
— The Company incurred general and administrative expenses of $1.0 million for 3Q19, compared with $0.8 million for 3Q18. The increase in general and administrative expenses in 3Q19 as compared to 3Q18 was primarily due to increased personnel compensation that reflects increased staffing, reflective of the growth in the Company’s operations.
— At March 31, 2019, the Company’s cash, cash equivalents and short-term investments were $20.4 million, which compares to $23.0 million at December 31, 2018.
— At March 31, 2019, the Company’s total issued and outstanding shares were 172,133,633. Including outstanding stock options and warrants, as at March 31, 2019, the Company had 222,648,790 shares on a diluted basis. During 3Q19, the weighted average number of common shares was 171,328,077, which is used for the calculation of loss per share.
Conference Call & Webcast:
Wednesday, May 15, 2019 at 10:00 AM Pacific Time, 1:00 PM Eastern TimeToronto: +1.416.764.8688Vancouver: +1.778.383.7413North America (Toll Free): +1.888.390.0546Conference ID: 17193517Webcast: https://event.on24.com/wcc/r/1999675/955779A89027D040E64A5A3804E51DBE
Replays, Available through May 22, 2019:
Toronto: +1.416.764.8677North America (Toll Free): +1.888.390.0541Playback Passcode: 193517 #
The Company’s full financial statements and related MD&A for the three months ended March 31, 2019 will be available at www.sedar.com on May 15, 2019.
Table 1: Condensed consolidated interim statements of financial position (unaudited):
InMed Pharmaceuticals Inc.CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (unaudited)As at March 31, 2019 and June 30, 2018Expressed in Canadian Dollars March 31 June 30 2019 2018ASSETSCurrentCash and cash equivalents $ 12,931,236 $ 24,134,277Short-term investments 7,440,225 2,342,615Accounts receivable 76,886 53,373Prepaids and advances 649,179 203,477Total current assets 21,097,526 26,733,742Non-CurrentProperty and equipment 47,478 55,732Intangible assets 1,205,441 1,273,670Total Assets $ 22,350,445 $ 28,063,144LIABILITIES AND SHAREHOLDERS' EQUITYCurrentTrade payables 667,786 937,759SHAREHOLDERS' EQUITYShare capital 68,454,340 68,058,698Contributed surplus 13,528,757 10,381,759Accumulated deficit (60,300,438) (51,315,072) 21,682,659 27,125,385 $ 22,350,445 $ 28,063,144
Table 2: Condensed consolidated interim statements of comprehensive loss (unaudited):
InMed Pharmaceuticals Inc.CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE LOSS (unaudited)For the three and nine months ended March 31, 2019 and 2018Expressed in Canadian Dollars Three Months Ended Nine Months Ended March 31 March 31 2019 2018 2019 2018ExpensesGeneral and administrative $ 988,632 $ 814,982 $ 2,723,265 $ 2,391,617Research and development 1,615,729 554,750 3,189,671 1,350,182Amortization and depreciation 31,538 30,088 94,267 87,123Foreign exchange (gain) loss 72,978 2,846 (18,024) 5,842Share-based payments 890,581 758,350 3,337,640 1,691,722Total expenses 3,599,458 2,161,016 9,326,819 5,526,486Interest income 108,887 33,059 341,453 34,766Total comprehensive loss for the period $ (3,490,571) $ (2,127,957) $ (8,985,366) $ (5,491,720)Basic and diluted loss per share for $ - 0.02 $ - 0.01 $ - 0.05 $ - 0.04the period
Table 3: Condensed consolidated interim statements of cash flows (unaudited):
InMed Pharmaceuticals Inc.CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (unaudited)For the nine months ended March 31, 2019 and 2018Expressed in Canadian Dollars 2019 2018OPERATING ACTIVITIESCash flows from operating activitiesLoss for the period $ (8,985,366) $ (5,491,720)Adjustments to reconcile loss to net cash used in operating activitiesAmortization and depreciation 94,267 87,123Share-based payments 3,337,640 1,691,722Accrued interest income on short-term investments (68,860) (2,905)Changes in non-cash working capital balances:Prepaids and advances (445,702) 136,015Accounts receivable (23,513) 8,643Trade payables (269,973) 266,480Total cash outflows from operating activities (6,361,507) (3,304,642)Cash Flows From Investing ActivitiesPurchase of short-term investments (5,028,750) (2,328,750)Purchase of property and equipment (17,784) (55,639)Total cash outflows from investing activities (5,046,534) (2,384,389)Cash Flows From Financing ActivitiesShares issued for cash 205,000 11,299,881Share issue costs - (768,675)Cash provided by financing activities 205,000 10,531,206Increase (decrease) in cash during the period (11,203,041) 4,842,175Cash and cash equivalents beginning of the period 24,134,277 6,707,796Cash and cash equivalents end of the period $ 12,931,236 $ 11,549,971
About InMed:InMed Pharmaceuticals is a biopharmaceutical company developing a proprietary biosynthesis system for the manufacturing of pharmaceutical-grade cannabinoids, as well as a pipeline of cannabinoid-based medications that target diseases with high unmet medical needs. The Company is dedicated to delivering new therapeutic alternatives to patients that may benefit from cannabinoid-based medicines. For more information, visit www.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: developing a proprietary biosynthesis platform technology for the manufacturing of pharmaceutical-grade cannabinoids as well as an R&D pipeline of medications targeting diseases with high unmet medical needs; the ability of our existing cash runway to position us to complete our forthcoming significant milestones, including advancing our INM-755 program through the completion of Phase I healthy volunteer studies, advancing our biosynthesis program in preliminary commercial scale-up activities, and advancing the glaucoma program through several pre-clinical studies; the ability of a single molecule product (INM-755), instead of a combination product, to improve our overall probability of success; in the near term, completing the fermentation optimization initiative, completing the process development of the DSP, and scaling-up fermentation batches towards commercial scale; continuing to pursue various avenues to maximize the yields and to lower the costs of cannabinoid manufacturing.
With respect to the forward-looking information contained in this news release, InMed has made numerous assumptions regarding, among other things: continued and timely positive preclinical and clinical efficacy data; the speed of regulatory approvals; the ability to contract with suitable partners; demand for InMed’s products; and continued economic and market stability. 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. Known risk factors include, among others: preclinical and clinical testing may not produce the desired results on a timely basis, or at all; regulatory applications may not be approved on a timely basis, or at all; cannabis licensing/importing issues may delay our projected development timelines; suitable partners may not be located; economic or market conditions may worsen; our existing cash runway may not allow us to complete our forthcoming significant milestones; INM-755 may not be as successful as desired, if at all; completion of the fermentation optimization initiative, completion of the process development of the DSP, and scaling-up fermentation batches towards commercial scale may not be completed in the near term, if at all; and the development of a proprietary biosynthesis platform technology for the manufacturing of pharmaceutical-grade cannabinoids as well as an R&D pipeline of medications targeting diseases with high unmet medical needs may not be as successful as desired, if at all. A more complete discussion of the risks and uncertainties facing InMed is disclosed in InMed’s most recent Annual Information Form and other continuous disclosure filed with Canadian securities regulatory authorities on SEDAR at www.sedar.com.
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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SOURCE InMed Pharmaceuticals Inc.