On December 15, 2021 Citius Pharmaceuticals, Inc. ("Citius" or the "Company") (Nasdaq: CTXR), a late-stage biopharmaceutical company dedicated to the development and commercialization of first-in-class critical care products with a focus on oncology, anti-infective products in adjunct cancer care, unique prescription products, and stem cell therapies, reported business and financial results for the fiscal full year ended September 30, 2021 (Press release, Citius Pharmaceuticals, DEC 15, 2021, View Source [SID1234597255]).
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Fiscal Full Year 2021 Business Highlights and Subsequent Developments
Completed subject treatment in December 2021 in Pivotal Phase 3 trial of I/ONTAK (E7777) with topline results anticipated in the first half of 2022 and a biologics license application (BLA) submission in the second half of 2022;
Acquired Dr. Reddy’s Laboratories’ license for late-Phase 3 oncology immunotherapy I/ONTAK for the treatment of cutaneous T-cell lymphoma (CTCL) and other cancer indications;
Received third positive recommendation from independent Data Monitoring Committee to continue the Mino-Lok Phase 3 clinical superiority trial as planned without modifications; no safety concerns identified;
Completed dose-ranging proof-of-concept sheep study of iPSC-derived novel induced-mesenchymal stem cells (i-MSCs) for the treatment of acute respiratory distress syndrome (ARDS); analysis and documentation underway for peer-reviewed publication submission;
Expanded clinical, manufacturing and commercial capabilities with the addition of seasoned pharmaceutical executives;
Citius added to the Russell 3000 and 2000 indexes; and,
Raised net proceeds of $120.6 million in financing activities during the year.
Financial Highlights
Cash and cash equivalents of $70.1 million as of September 30, 2021;
R&D expenses were $12.2 million for the full year ended September 30, 2021, compared to $8.8 million for the full year ended September 30, 2020;
G&A expenses were $9.8 million for the full year ended September 30, 2021, compared to $8.1 million for the full year ended September 30, 2020;
Stock-based compensation expense was $1.5 million for the full year ended September 30, 2021, compared to $0.8 million for the full year ended September 30, 2020; and,
Net loss was $23.1 million, or ($0.23) per share for the full year ended September 30, compared to a net loss of $17.5 million, or ($0.45) per share for the full year ended September 30, 2020.
"2021 was a transformative year for Citius as we positioned the company financially and strategically to drive growth. We raised more than $120 million in proceeds to support our activities, providing us with the flexibility to advance our clinical programs and invest in opportunities for additional growth. With the recent addition of cancer immunotherapy I/ONTAK to our portfolio, we now have a robust pipeline that includes two late Phase 3 programs and three potentially first-in-class products," stated Myron Holubiak, President and Chief Executive Officer of Citius Pharmaceuticals.
"As we move into 2022, we anticipate multiple positive milestones. These include: accelerated enrollment and completion of the Mino-Lok trial during the year, topline results in the first half of 2022 for the recently completed I/ONTAK Pivotal Phase 3 trial followed by a BLA submission in the second half of the year, initiation of the Halo-Lido study in early 2022 and completion of the study by the end of the year, and continued progress on Mino-Wrap and our iPSC-derived mesenchymal stem cells for the treatment of acute respiratory distress syndrome (ARDS). With the addition of key personnel to our clinical, manufacturing and commercial teams, we are aligning our resources to ensure continued progress across each of our development programs, and the successful launch of potentially two commercial products in 2023. We believe our strong balance sheet will allow us to execute our development programs as planned in 2022 and we do not anticipate a need to raise additional capital in the coming year," concluded Mr. Holubiak.
Full Year 2021 Financial Results:
Liquidity
As of September 30, 2021, the Company had $70.1 million in cash and cash equivalents. During the fiscal year ended September 30, 2021, the Company received net proceeds of $120.6 million from financing activities.
In January 2021, the Company closed a private placement for common stock and warrants totaling gross proceeds of approximately $20 million and net proceeds of $18.5 million. In February 2021, the Company closed a registered direct offering of its common stock and warrants for gross proceeds of $76.5 million and net proceeds of $71 million. During the year ended September 30, 2021, the Company received $31.2 million in proceeds from the exercise of common stock options and warrants.
On June 21, 2021, stockholders approved an amendment to the Company’s Articles of Incorporation to increase the authorized number of shares from 210,000,000 to 410,000,000 and the authorized number of common shares from 200,000,000 to 400,000,000. As of September 30, 2021, the Company had 145,979,429 common shares issued and outstanding.
In 2021, the Company raised a total of $127.6 million through financing activities. We estimate that we will have sufficient funds for our operations through March 2023.
Research and Development (R&D) Expenses
R&D expenses were $12.2 million for the full year ended September 30, 2021, compared to $8.8 million for the full year ended September 30, 2020. The increase of $3.4 million is primarily due to an increase in research and development expenses for our proposed novel cellular therapy for ARDS of $6.1 million, of which $5 million was a license fee paid to Novellus, and an increase in R&D expenses related to the I/ONTAK license and Mino-Wrap, offset by decreases in research and development expenses related to our Mino-Lok and Halo-Lido product candidates.
We expect that research and development expenses will increase in fiscal 2022 as we continue to focus on our Phase 3 trial for Mino-Lok, progress the Halo-Lido product candidate, and continue our research and development efforts related to ARDS, Mino-Wrap and I/ONTAK (E7777).
General and Administrative (G&A) Expenses
G&A expenses were $9.8 million for the full year ended September 30, 2021, compared to $8.1 million for the full year ended September 30, 2020. The primary reason for the increase is costs associated with additional compensation costs for new employees and performance bonuses. General and administrative expenses consist primarily of compensation costs, professional fees related to our capital raising activities, corporate development services, and investor relations.
Stock-based Compensation Expense
For the full year ended September 30, 2021, stock-based compensation expense was $1.5 million as compared to $0.8 million for the prior year. The increase reflects expenses related to new grants made by Citius and the NoveCite stock option plan.
Net loss
Net loss was $23.1 million, or ($0.23) per share for the year ended September 30, compared to a net loss of $17.5 million, or ($0.45) per share for the year ended September 30, 2020. The increase in net loss is primarily due to the $3.4 million increase in our research and development expenses and a $1.6 million increase in general and administrative expenses.