Dr. Lior Shaltiel reports
NUREXONE REPORTS FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2023 FINANCIAL RESULTS AND PROVIDES COMPANY UPDATE
Nurexone Biologic Inc. has provided a business update and released financial results for the fourth quarter and financial year ended Dec. 31, 2023.
Fourth quarter highlights and significant milestones:
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On Oct. 26, 2023, the company received a response from the Food and Drug Administration (FDA), advising that pursuant to Section 526 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360bb), the orphan drug designation (ODD) request of MSC-derived (mesenchymal stem cell) derived small extracellular vesicles (EVs) loaded with short and modified interfering RNA (siRNA) against the phosphatase and tensin homolog (PTEN) protein is granted for treatment of acute spinal cord injury (SCI). This achievement is expected to profoundly shape the company's regulatory and go-to-market strategies for ExoPTEN. ODD offers substantial benefits, including market exclusivity and protection upon drug approval (in addition to existing intellectual property protection), financial incentives, regulatory assistance, and developmental support. Over all, this designation serves to incentivize and facilitate the development of treatments for rare diseases, thereby enhancing patient access to therapies.
- On March 1, 2024, the company commenced the set-up of in-house laboratories and offices to bolster its research and development capabilities, subsequent to entering into lease and construction agreements. Completion of these initiatives is anticipated by the end of June, 2024.
- The company announced on March 22, 2024, its engagement in animal experiments through a contract research organization (CRO) as part of the preclinical testing phase for the submission of an investigational new drug (IND) application to the FDA. This is aimed at assessing the safety and efficacy of the ExoPTEN drug before proceeding to clinical trials involving human subjects, which are anticipated to commence in 2025. This engagement followed the completion of a preinvestigational new drug meeting with the FDA regarding the manufacturing, preclinical and clinical development plan of ExoPTEN, Nurexone's inaugural ExoTherapy product, and subsequent receipt of a written response from the FDA.
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On March 27, 2024, the company announced a total of approximately $4-million proceeds from the exercise of both accelerated and non-accelerated warrants from the issuance of 10,423,629 common share purchase warrants. A total of 9,684,993 warrants were exercised at a cash price of 38 cents, 556,818 warrants were exercised at a price of 34 cents and 181,818 warrants were exercised at a price of 48 cents.
Dr. Lior Shaltiel, chief executive officer of Nurexone, stated, "Our emphasis on research and development in 2023, coupled with the expansion of our intellectual property (IP) portfolio, the ODD for ExoPTEN and the growth of the ExoTherapy platform, are laying the groundwork for the accelerated introduction of minimally invasive regenerative medicine."
Eran Ovadya, chief financial officer of Nurexone, remarked, "Due to the ongoing support and confidence of our investors, the company is confident that its current total existing funds, augmented by the recently completed exercise of warrants, will support ongoing operating activities through the end of 2024."
Full-year and fourth quarter 2023 financial results:
- The company is still in the research, development and growth stage. The company has not commercialized any products or generated any significant revenues, or become cash flow positive, and will continue to be reliant on the ability to finance its activities by raising additional equity or debt until profitability is achieved.
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Research and development expenses were $1.54-million (U.S.) in 2023, compared with $1.39-million (U.S.) in 2022. For the fourth quarter of 2023, expenses were $310,000 (U.S.), compared with $390,000 (U.S.) in the previous year. The increase of $150,000 (U.S.) in 2023, compared with 2022, was primarily due to the extensive research and development efforts required to continue the development of the ExoPTEN technology and other siRNA targets.
- General and administrative expenses were $2.12-million (U.S.) in 2023, compared with $4.15-million (U.S.) in 2022. For the fourth quarter of 2023, expenses were $400,000 (U.S.), compared with $460,000 (U.S.) in the previous year. The decrease of $2.03-million (U.S.) in 2023, compared with 2022, was primarily due to the reduction in professional services, mainly attributable to the transition to becoming a listed public company in 2022.
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Listing expenses were zero in 2023, compared with $2.08-million (U.S.) in 2022. These expenses were associated with the closing of the reverse takeover transaction on June 15, 2022.
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Financial income/expenses, net, were $20,000 (U.S.) of income in 2023, compared with $550,000 (U.S.) of expense in 2022. For the fourth quarter of 2023, expenses were $20,000 (U.S.), compared with $170,000 (U.S.) in the previous year. The change in financial income of $570,000 (U.S.) in 2023, compared with 2022, was primarily due to $500,000 (U.S.) of non-cash expenses in 2022, related to the valuation of warrants and royalty liability.
- Net loss was $3.64-million (U.S.) in 2023, compared with a net loss of $8.17-million (U.S.) in 2022. The decrease of $4.53-million (U.S.) in 2023, compared with 2022, was primarily driven by a decrease in general and administrative expenses of $2.03-million (U.S.) and a decrease in listing expenses of $2.08-million (U.S.) incurred in 2022, both associated with the closing of the reverse takeover transaction in 2022, contributed to the lower net loss.
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Cash position: As of Dec. 31, 2023, the company had total cash and equivalents of $540,000 (U.S.), compared with $2.46-million (U.S.) as of Dec. 31, 2022. The decrease of $1.92-million (U.S.) is due primarily to $1.09-million (U.S.) in net cash proceeds from completed non-brokered private placement and $100,000 (U.S.) from a received grant from the Israeli Innovation Authority, offset by $3.11-million (U.S.) of net cash used in operating activities.
Additionally, the company had secured $1.20-million (U.S.) as restricted cash, as of Dec. 31, 2023, associated with a non-brokered private placement completed in January, 2024, for total gross proceeds of $1.50-million (U.S.) from the issuance of 7,091,993 common shares and warrants.
About Nurexone Biologic Inc.
Nurexone Biologic is a TSX Venture Exchange-listed pharmaceutical company that is developing a platform for biologically guided exosome-based therapies to be delivered, non-invasively, to patients who have suffered central nervous system injuries. The company's first product, ExoPTEN for acute spinal cord injury, was proven to recover motor function in 75 per cent of laboratory rats when administered intranasally. ExoPTEN has been granted orphan drug designation by the FDA. The Nurexone platform technology is expected to offer novel solutions to drug companies interested in non-invasive targeted drug delivery for other indications.
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