Mr. Steve Saviuk reports

VALEO PHARMA REPORTS RECORD SECOND QUARTER REVENUES

Valeo Pharma Inc. today released its financial results for the second quarter ended April 30, 2023.

Second quarter 2023 results and highlights:

• Record quarterly revenues of $13.6-million in Q2 2023, compared with $4.8-million in Q2 2022, up 184 per cent, with Enerzair and Atecura up 271 per cent.
• Record adjusted gross profit of $5.0-million in Q2 2023 compared with $1.8-million in Q2 2022, up 181 per cent.
• Q2 2023 net loss of $6.5-million compared with $5.1-million in Q2 2022.
• Q2 2023 adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss of $1.7-million compared with a $3.6-million loss in Q2 2022, a 53-per-cent reduction.
• Enerzair and Atectura prescribing physicians reached 2,036 at the end of Q2 2023, a 29-per-cent growth for the quarter and 355 per cent increase year over year.
• Total of 14,765 Enerzair and Atectura prescriptions during Q2 2023, up 291 per cent over Q2 2022.
• Total of 45,031 Enerzair and Atectura prescriptions over the last 12 months, up 654 per cent year over year.

"Our second quarter financial and commercial performance was robust and reflects our strong product portfolio and dynamic commercial team," said Steve Saviuk, Valeo's chief executive officer. "Enerzair and Atectura's revenue and prescription growth is reflecting broadening adoption. As we are still in the early stages of their commercialization, we expect this trend to continue to gain traction in the coming quarters. Organic growth for our product portfolio, as well as the important contribution of our new ophthalmology business unit, are key elements in growing our overall revenues and sharply improving our financial performance. This trend will continue in quarters to come as we progress towards profitability."

Commenting on the record second quarter 2023 results, Luc Mainville, senior vice-president and chief financial officer, said: "Q2 2023 delivered yet again another sequential financial performance improvement. The combination of growing revenues, product margins and strict control over opex has contributed to reduce our quarterly adjusted EBITDA loss for a sixth consecutive quarter. We anticipate this trend to continue for the coming quarters and remain focused on achieving breakeven status as rapidly as possible. After significant investments in our working capital to support our growth and the addition of new commercial assets earlier in fiscal year 2023, our cash position remained strong at the end of Q2 2023 at $10.1-million, down $800,000 compared with the prior quarter."

Second quarter 2023 financial results

• Record revenues were $13.6-million for the quarter ended April 30, 2023, compared with $4.8-million for the quarter ended April 30, 2022, representing a 184-per-cent increase. The increase over the previous comparable period is mainly due to the addition of Xiidra, Simbrinza and Allerject, as well as continued growth and market share gains of the company's other core products, Redesca, Enerzair and Atectura;
• 39-per-cent organic revenue growth in Q2 2023 compared with Q2 2022, including 271-per-cent combined revenue growth from Enerzair and Atectura;
• Adjusted gross profit was $5.0-million for the quarter ended April 30, 2023, compared with $1.8-million for the quarter ended April 30, 2022, representing a 181-per-cent increase. The increase over the previous comparable period is mainly due to the significant increase in the company's revenues;
• Net loss was $6.5-million for the quarter ended April 30, 2023, compared with $5.1-million for the quarter ended April 30, 2022. The 27-per-cent increase in net loss in Q2 2023 was due to the increase in financial and sales and marketing expenses, which was partly offset by the significant increase of our gross profit;
• Adjusted EBITDA loss was $1.7-million for the quarter ended April 30, 2023, compared with $3.6-million for the quarter ended April 30, 2022, a 53-per-cent improvement.

Year to date 2023 financial results

• Record YTD revenues of $26.7-million for the six months ended April 30, 2023, compared with $9.0-million for the six months ended April 30, 2022, representing a 197-per-cent increase;
• Adjusted gross profit was $9.3-million for the six months ended April 30, 2023, up 180 per cent compared with $3.3-million for the six months ended April 30, 2022;
• Net loss of $12.8-million for the six months ended April 30, 2023, compared with $11.1-million for the six months ended April 30, 2022. The increase in net loss is mainly due to the increase in financial and sales and marketing expenses, which was partly offset by the significant increase of the company's gross profit; and
• Adjusted EBITDA loss of $3.9-million for the six months ended April 30, 2023, compared with an adjusted EBITDA loss of $8.1-million for the six months ended April 30, 2022, a 52-per-cent improvement.

Second quarter 2023 highlights

• In April, 2023, the company held its annual meeting of shareholders with the following directors elected, Steve Saviuk, Richard MacKay, Marc Leger, Maureen Brennan, Michel Trudeau and Stuart Fowler. PricewaterhouseCoopers LLP was also appointed as the auditor for the company;
• In March, 2023, Valeo granted 1.25 million options to executives, the whole in accordance with the company's share option plan. The options have an exercise price of 66 cents per Class A share of the company, vest equally over two years and have a seven-year term;
• In February and March, 2023, convertible debentures issued in February, 2020, and representing $700,000 in principal and interest were converted into 1,671,880 shares of the corporation;
• In February, 2023, the company announced that Onstryv (safinamide) for the treatment of patients suffering from Parkinson's disease, was now listed for public reimbursement on the Public Prescription Drug Insurance Plan of the Quebec Regie de l'assurance maladie du Quebec (RAMQ), effective Feb. 1, 2023.

Second quarter 2023 subsequent events

• In May, 2023, following the U.S. Food and Drug Administration (FDA) decision to decline Veru's request for Emergency Use Authorization (EUA) for sabizabulin, the company and Veru Inc. mutually agreed to terminate their commercial services agreement for sabizabulin for COVID-19 in Canada originally entered into on Sept. 14, 2022.

Second quarter 2023 webcast and conference call

Valeo will host a conference call to discuss its second quarter 2023 results and highlights on Wednesday June 14, 2023, at 8.30 a.m. ET. The telephone numbers to access the conference call are 416-764-8659 and 1-888-664-6392. An audio replay of the call will be available. The numbers to access the audio replay are 416-764-8677 and 1-888-390-0541 using the following access code (029860 followed by the pound key).

Financial statements and MD&A

Valeo Pharma's financial statements and management's discussion and analysis for the three-month and six-month periods ended April 30, 2023, are available on SEDAR.

About Valeo Pharma Inc.

Valeo Pharma is a fast-growing Canadian pharmaceutical company dedicated to the commercialization of innovative prescription products in Canada with a focus on respiratory/allergy, ophthalmology and hospital specialty products. Headquartered in Kirkland, Que., Valeo Pharma has all the required capabilities and the full infrastructure to register and properly manage its growing product portfolio through all stages of commercialization.

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