Dr. Lior Shaltiel reports
NUREXONE REPORTS THIRD QUARTER 2022 FINANCIAL RESULTS AND PROVIDES CORPORATE UPDATE
Nurexone Biologic Inc. has released a corporate update and financial results for the quarter ended Sept. 30, 2022.
"Obtaining U.S. FDA approval for our drug platform remains a priority for Nurexone and we intend to continue working towards expediting this process by submitting a pre-IND [investigational new drug] meeting request," said Dr. Lior Shaltiel, chief executive officer of Nurexone. "In addition to pursuing our regulatory objective, we are advancing other areas of our business, including securing more international collaborations with biotechnology companies and completing more key scientific initiatives. We have also strengthened our balance sheet by settling EnerSpar Corp.'s debts (the predecessor company to Nurexone) that were incurred prior to our go-public listing."
U.S. Food and Drug Administration (FDA) approval road map
On Oct. 19, Nurexone was informed by the U.S. FDA in an official response that the company was beyond the stage of participating in an initial targeted engagement for regulatory advice on CBER (FDA Center for Biologics Evaluation and Research) products meeting, and can proceed to request a pre-IND meeting in connection with the development of ExoPTEN, Nurexone's first exotherapy product. As a result, the company plans to submit a pre-IND meeting request to the U.S. FDA in January, 2023.
A pre-IND meeting offers applicants valuable information in regard to preparing complete IND applications, which can reduce the risk of a clinical hold, and planning and preparing clinical studies for their products. As a result, a pre-IND meeting could potentially shorten the regulatory timeline for the launch of Nurexone's exotherapy into the U.S. market.
Strategic collaborations and partnerships
The company intends to continue establishing more strategic collaborations and partnerships to expand its technology portfolio and unlock new synergies in commercializing its exosome-based drug platform.
On July 18, 2022, Nurexone signed a material transfer agreement with Yissum Research Development Company, a wholly owned subsidiary of the Hebrew University of Jerusalem Ltd., to transfer certain biological, chemical and other tangible materials to Yissum, for use by professor Tal Burstyn-Cohen and her team at the Hebrew University. Ms. Burstyn-Cohen is an experienced researcher at the Hebrew University and leader of the Burstyn-Cohen lab, which researches molecular and cellular mechanisms that underlie tissue homeostasis in health. Under the agreement, Nurexone will have an option to receive an exclusive licence to the jointly owned results and related intellectual property (if any) that may arise from the research by professor Burstyn-Cohen, in the field of neurodegenerative diseases and CNS (central nervous system) indications.
In addition, Nurexone signed a letter of intent with denovoMatrix GmbH, a leading German developer of innovative technologies for cell therapies, to collaborate on developing specialized coatings for Nurexone's cell carriers for exosome production by denovoMatrix's advanced screenMatrix platform. Both parties aim to develop a mutually beneficial supply agreement, in which denovoMatrix will develop and provide technologies in order to optimize the manufacturing processes of the company's exotherapy, enabling large-scale exosome production.
The company also signed a non-binding letter of intent with Nanometrix Ltd., a nanoparticle analysis company based in the United Kingdom, as previously announced on Oct. 12, 2022. Under the agreement, Nurexone will collaborate with Nanometrix to obtain detailed information about the molecular profiling of exosomes, and quantification of the siRNA (small interfering RNA) cargo copy number per extracellular vesicle for Nurexone's exosomes and cargo samples through Nanometrix's artificial-intelligence-driven software.
Furthermore, the company recently participated in the 2022 Bio-Europe Conference, which was held in Leipzig, Germany, to establish new business relationships with companies within the global biopharma industry.
Nurexone intends to continue completing different scientific initiatives across various verticals to grow its technology platform. In September, 2022, Nurexone announced survey results that demonstrated the effectiveness of its proprietary small interfering RNA in inhibiting the expression phosphatase and tensin homolog (PTEN), which promotes axon regeneration and neural repair -- key elements that enable healing for traumatic spinal cord injuries.
Additionally, the company released the results of an internal productivity and quality pilot of its patent-pending process for 3-D scaled-up exosome production, which indicated a boost in exosome productivity while improving cost-efficiency. This process will not only be integrated within Nurexone's drug platform once finalized, but also commercialized, in which the company will license it to other biopharmaceutical companies.
Completion of debt settlement
On Nov. 8, 2022, Nurexone completed securities for debt settlements, previously announced by the company on Sept. 1, 2022, and Sept. 19, 2022. Nurexone agreed to settle debts in the aggregate amount of $136,155.83 with the issuance of 170,195 common shares of the company at a deemed price of 80 cents per share (including the issuance of 117,033 shares to James (Jay) Richardson, a director of the company). The company also agreed to settle additional debts in the aggregate amount of $75,000 with the issuance of 178,571 common shares of the company at a deemed price of 42 cents per share.
Third quarter fiscal 2022 financial results:
- Research and development expenses were $420,000 (U.S.) in the third quarter of 2022, compared with $40,000 (U.S.) for the same period in 2021. The increase was largely attributable to the extensive research and development efforts required to continue the development of the siRNA-PTEN technology and other siRNA targets.
- General and administrative expenses were $570,000 (U.S.) in the third quarter of 2022, compared with $230,000 (U.S.) for the same period in 2021. The increase was mainly due to a $100,000 (U.S.) increase in service providers, an increase of $100,000 (U.S.) in salaries and share-based compensation (driven by an increase in headcounts), an increase of $50,000 (U.S.) in legal expenses, an increase of $30,000 (U.S.) in insurance expenses, and an increase of $60,000 (U.S.) in fees and other expenses.
- Listing expenses were $40,000 (U.S.) in the third quarter of 2022. The listing expenses for the nine months ended Sept. 30, 2022, were $2.08-million (U.S.), as follows:
- $1.61-million (U.S.) at a fair value for the reverse takeover acquisition of 2,536,000 EnerSpar Corp. shares at a share price of 80 Canadian cents;
- $240,000 (U.S.) for net liabilities of EnerSpar Corp.; and
- $230,000 (U.S.) for legal costs as associated with the completed reverse takeover transaction in the second quarter of 2022.
- Finance expenses, net, were $380,000 (U.S.) in the third quarter of 2022, compared with an income of $70,000 (U.S.) in the same period in 2021. The increase was primarily due to revaluation and a change in accounting policy for warrant derivatives.
- Net loss was $1.1-million (U.S.) in the third quarter of 2022, or a loss of three U.S. cents per share, compared with a net loss of $260,000 (U.S.), or a loss of 2.5 U.S. cents per share, in the third quarter of 2021.
Financial guidance for 2022
As at Sept. 30, 2022, the company had cash of $3.15-million (Dec. 31, 2021 -- $2.21-million) and working capital of $2.71-million (Dec. 31, 2021 -- $1.18-million). The company had a deficit of $9.4-million as of Sept. 30, 2022 (Dec. 31, 2021 -- $2.25-million).
Nurexone expects that its current total cash position, together with recent financing, will support the company's continuing operating activities into September, 2023. This cash runaway guidance is based on the company's current operational plans, and excludes any additional financing and any business development activities that may be undertaken. Nurexone continues to assess all financing options that support its corporate strategy.
About Nurexone Biologic Inc.
Nurexone Biologic is a TSX Venture Exchange listed pharmaceutical company that is developing a platform for biologically guided exotherapy to be delivered, non-invasively, to patients who suffered traumatic spinal cord injuries. Exotherapy was conceptually demonstrated in animal studies at the Technion -- Israel Institute of Technology. Nurexone is translating the treatment to humans, and the company holds an exclusive worldwide licence from the Technion and Tel Aviv University for the development and commercialization of the technology.
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