On August 11, 2022 KemPharm, Inc. (NasdaqGS: KMPH) (KemPharm, or the Company), a specialty pharmaceutical company focused on the discovery, development and commercialization of novel treatments for rare central nervous system (CNS), neurodegenerative and lysosomal storage diseases, reported its financial results for the second quarter ended June 30, 2022 (Press release, KemPharm, AUG 11, 2022, View Source [SID1234618265]).

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"KemPharm’s recent acquisition of arimoclomol, along with substantially all of Orphazyme’s assets and operations, provided an exclamation point to the first half of 2022 as we shifted our strategic focus to the development of therapies targeting rare central nervous system (CNS), neurodegenerative, and lysosomal storage diseases," stated Travis Mickle, Ph.D., President and Chief Executive Officer of KemPharm. "We believe this orientation towards rare disease classification with limited treatment options and no approved treatments in the U.S. provides a significant opportunity for KemPharm to make an impact in an area of high-need and to validate the potential of our strategy to create both near and longer-term shareholder value."

Dr. Mickle continued, "The acquisition of arimoclomol is a unique and potentially game-changing opportunity for KemPharm. Arimoclomol is an NDA-stage product candidate being developed for the treatment of Niemann-Pick disease type C (NPC), a rare neurodegenerative disease for which no approved therapy exists in the U.S. We acquired this asset for total consideration of $18.0 million, which included a cash payment of $12.8 million and the assumption of an estimated reserve liability equal to approximately $5.2 million. The cash payment was funded through a line of credit secured by our balance sheet, making this transaction very capital efficient. Another important part of this transaction is maintaining the early access programs in the U.S. and the E.U. while we support the ongoing work of seeking regulatory approval. KemPharm is concentrating more of our resources towards the resubmission of the arimoclomol NDA with the U.S. Food and Drug Administration (FDA), which we expect to complete as early as the first quarter of 2023."

Dr. Mickle continued, "In parallel with our work on arimoclomol is the ongoing development of KP1077, our lead clinical candidate, which we are advancing as a treatment for idiopathic hypersomnia (IH) and narcolepsy. As announced in May, the Investigational New Drug (IND) application to initiate a clinical program investigating KP1077 for the treatment of IH has been successfully filed with the FDA. We expect to initiate the Phase 2 trial of KP1077 in IH by the end of 2022, with a second trial focused on narcolepsy commencing soon thereafter. Additionally, we expect to report topline results from the cardiovascular safety study involving serdexmethylphenidate (SDX) as soon as Q3 2022. We believe that demonstrating an improved cardiovascular safety profile compared to current stimulants could be a key potential differentiator for KP1077."

Dr. Mickle continued, "The execution of our strategy is continuing as KemPharm seeks to build a diverse and unique product portfolio combining an NDA-stage product with a rapidly advancing clinical-stage pipeline targeting multiple disease indications. Additionally, KemPharm continues to be excited by the commercialization of AZSTARYS by Corium. We are pleased that Perry Sternberg, Corium’s President and CEO, will join our second quarter results conference call to discuss ongoing commercialization activities and review the substantial progress made, including the recent national expansion of the launch of AZSTARYS."

Dr. Mickle concluded, "Looking ahead, we believe KemPharm is well positioned for growth on multiple fronts, while possessing a strong operational and financial foundation, including $114.5 million in cash, cash equivalents and investments as of June 30, 2022. We believe these attributes, combined with the numerous milestone opportunities anticipated for 2022 and beyond, position KemPharm for continued growth despite current macroeconomic and global equity market challenges. This is a very exciting time for KemPharm."

Q2 2022 Financial Results:

KemPharm’s net revenue for Q2 2022 was $1.3 million, as compared to Q2 2021 net revenue of $12.0 million. The Q2 2021 net revenue included a one-time regulatory payment of $10 million for the DEA scheduling of AZSTARYS.

Research and development expenses were $4.8 million for Q2 2022, as compared to $2.8 million in Q2 2021, driven primarily by spending on the KP1077 clinical development program and, increased compensation costs, including non-cash stock-based compensation expense.

General and administrative expenses were $3.6 million for Q2 2022, as compared to $2.3 million in Q2 2021. The period-over-period increase was primarily driven by increased compensation costs, including non-cash stock-based compensation expense.

In addition, KemPharm recognized $17.7 million of expense during Q2 2022 related to acquired in-process research and development from the arimoclomol asset acquisition during the quarter, which was immediately expensed.

Net loss attributable to common stockholders for Q2 2022 was ($24.0) million, or ($0.70) per basic and diluted share, compared to a net loss attributable to common stockholders of ($10.7) million, or ($0.40) per basic and diluted share for the same period in 2021. Net loss for Q2 2022 was driven primarily by the one-time non-cash expense recognized in Q2 2022 for the arimoclomol asset acquisition of $17.7 million, research and development expense of $4.8 million, and general and administrative expense of $3.6 million, partially offset by an income tax benefit of $0.7 million. Excluding the one-time $17.7 million of non-cash expense related to the arimoclomol asset acquisition recognized during Q2 2022, adjusted net loss was ($6.4) million, or ($0.19) per basic and diluted share.

As of June 30, 2022, total cash, cash equivalents and investments were $114.5 million, which was a decrease of $4.6 million compared to $119.1 million as of March 31, 2022, driven in part by increased spending on third-party research and development costs related to the KP1077 clinical trial program, and other expenses related to the arimoclomol asset acquisition. Based on the Company’s current operating forecast, existing cash, cash equivalents and investments are expected to be sufficient to continue operations beyond 2025.

Conference Call Information:

KemPharm will host a conference call and live audio webcast with a slide presentation today at 5:00 p.m. ET, to discuss its corporate and financial results for the second quarter of 2022.

The audio webcast with slide presentation will be accessible via the Investor Relations section of the Company’s website, View Source An archive of the webcast and presentation will be available for 90 days beginning at approximately 6:00 p.m. ET, on August 11, 2022.

On August 11, 2022 Savara Inc. (Nasdaq: SVRA), a clinical stage biopharmaceutical company focused on rare respiratory diseases, reported financial results for the second quarter ending June 30, 2022 and provided a business update (Press release, Savara, AUG 11, 2022, View Source [SID1234618264]).

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"Despite ongoing factors such as geographical COVID surges, geopolitical issues and supply chain constraints, IMPALA-2, the pivotal Phase 3 trial of our novel inhaled biologic, is currently on-track for a top line read-out by the end of 2Q 2024," said Matt Pauls, Chair and CEO, Savara. "With a cash position of approximately $142M at the end of the second quarter of 2022, we are confident that we are funded through 2025, which is well beyond the expected IMPALA-2 read-out."

Second Quarter Financial Results (Unaudited)

Savara’s net loss for the three months ended June 30, 2022 was $9.2 million, or $(0.06) per share, compared with a net loss attributable to common stockholders of $10.9 million, or $(0.07) per share, for the three months ended June 30, 2021.

Research and development expenses decreased by $0.8 million, or 11.5%, to $6.4 million for the three months ended June 30, 2022, from $7.3 million for the three months ended June 30, 2021. This was due to an approximately $0.7 million decrease associated with molgramostim, which was primarily due to the timing of certain contract research organization-related costs. Additionally, there was an approximately $0.1 million decrease associated with the close-out and wind-down of inhaled vancomycin development activities.

General and administrative expenses decreased by $0.2 million, or 6.2%, to $3.0 million for the three months ended June 30, 2022 from $3.2 million for the three months ended June 30, 2021. This was primarily attributable to decreased administrative and compensation costs associated with streamlining certain operational activities, which were initiated during the third quarter of 2021.

As of June 30, 2022, Savara had cash, cash equivalents, and short-term investments of approximately $142 million and debt of approximately $26 million.

On August 11, 2022 Insilico Medicine, a clinical-stage end-to-end artificial intelligence (AI)-driven drug discovery company, reported that it has completed a second closing of its Series D round, led by Prosperity7 Ventures, the diversified growth fund of Aramco Ventures, bringing the total Series D financing to $95 million (Press release, Insilico Medicine, AUG 11, 2022, View Source [SID1234618245]). Other global investors with expertise in the biopharmaceutical and life sciences sectors also participated.

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The financing brought in Prosperity7 as a new investor, alongside current investors in the Series D round, including a large, diversified asset management firm on the US West Coast, B Capital Group, Warburg Pincus, BHR Partners, Qiming Venture Partners, Deerfield, Pavilion Capital, BOLD Capital Partners, and WS Investment Company. Insilico’s founder and CEO, Alex Zhavoronkov, PhD, also invested in the Series D round.

Aysar Tayeb, Executive Managing Director of Prosperity7 Ventures, said: "The deepening application of AI and machine learning for drug discovery has demonstrated a transformative positive impact on the pharmaceutical industry and we are delighted to embark on this partnership with Insilico Medicine, a frontrunner in this innovation. Backed by the breadth of Aramco’s ecosystem across geographies and sectors, we look to support the company to scale up and expand its footprint globally, to drive biotechnology excellence, and to bring positive impact for greater wellbeing."

The new Series D capital will support the continued advancement of Insilico’s pipeline, including its lead program which is currently in a Phase 1 study in New Zealand and in China, as well as several pipeline programs in IND-enabling studies. The proceeds will also fund other key strategic initiatives, including further development of its end-to-end Pharma.AI platform, the launch of a fully automated, AI-driven robotic drug discovery laboratory and biological data factory, and the establishment of regional centers.

The investment from Prosperity7 further diversifies the Company’s investor base globally and brings a potential strategic partner with deep expertise in high-performance and environmentally friendly energy R&D. Relying on Prosperity7’s global network and generous resources, Insilico will expand its AI capabilities from drug R&D to multiple areas, including sustainable chemistry, green energy, and agriculture to actively support sustainable development. Insilico had already leveraged the power of its platform to accelerate innovation in sustainable agriculture in a multi-year collaboration with Syngenta which validated that the platform’s capabilities in AI-enabled multiparameter optimization could create substantial value.

"In 2022, Aramco became the world’s most valuable company, and we are deeply honored to receive the investment from their venture capital arm, Prosperity7, which focuses on investment in ‘disruptive technology’," said Alex Zhavoronkov, PhD, founder and CEO of Insilico Medicine. "Our experience in expanding our reach into sustainable agriculture through our collaboration with Syngenta and others demonstrated the diversity of data and methods and unprecedented scale up allows us to improve our performance. I am certain that the collaborations with Prosperity7 in the field of sustainable and environmentally friendly chemistry and clean energy solutions will further expand our artificial intelligence capabilities. In addition, after spending time in Saudi Arabia, it is clear that the country is making a giant leap in technology. We would love to be part of this effort and help the country realize its vision using the latest advances in artificial intelligence."

Through a unique dual-CEO structure, Insilico Medicine is advancing its AI capabilities and drug research and development simultaneously. Recently, the Company promoted Dr. Feng Ren, Insilico’s Chief Scientific Officer (CSO) to the position of co-CEO to drive the company’s drug R&D platform. In addition to overseeing drug discovery and development, Dr. Ren will also guide the Company’s growing clinical development and will play a leading role in driving business development. During his tenure, the Company has rapidly transformed its pipeline into a robust portfolio of novel, innovative drug candidates, targeting areas with highly unmet needs. Seven programs in its internal pipeline have progressed to IND-enabling studies, including a novel 3CL protease inhibitor for COVID-19 treatment, and two synthetic lethality programs targeting MAT2A and USP1 for oncology indications. It also successfully completed a Phase 0 microdose study in Australia and entered Phase I clinical trials with its first internally developed program targeting fibrosis in both New Zealand and China.

"We have the structure to be as an equal parts AI and drug development company," said Feng Ren, PhD, co-CEO and CSO of Insilico Medicine. "We also have a number of exciting initiatives in motion – including an expanding global presence, a robotics lab in development, and significant progress in our internal pipeline programs. With this latest funding round, we will be able to scale up our capabilities, advance our internal programs, develop our AI, and align with partners in the Saudi region to develop new regional technology hubs."

Insilico has co-development and software licensing deals with a number of major pharmaceutical companies. Since the launch of its PandaOmics and Chemistry42 platforms in late 2020, nine out of the top 20 pharmaceutical companies, as measured by 2020 revenue, have used Insilico’s AI platforms. In 2022, Insilico signed multi-asset partnerships with Fosun Pharma and EQRX in January and March, respectively. Notably, Insilico achieved its first major milestone and nominated a preclinical candidate for the QPCTL program for cancer immunotherapy less than 40 days into the strategic collaboration with Fosun Pharma. Business development continues to remain a vital part of the company’s strategy to demonstrate and unlock the value of its Pharma.AI platform.

On August 11, 2022 Diffusion Pharmaceuticals Inc. (NASDAQ: DFFN) ("Diffusion" or the "Company"), a biopharmaceutical company developing novel therapies that may enhance the body’s ability to deliver oxygen to areas where it is needed most, reported financial results for the quarter ended June 30, 2022, and provided a business update (Press release, Diffusion Pharmaceuticals, AUG 11, 2022, View Source [SID1234618241]).

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Development Updates

Aligned with FDA on Innovative Trial Design in Glioblastoma Multiforme ("GBM") Patients: In July 2022, Diffusion announced that it had aligned with the U.S. Food and Drug Administration ("FDA") on the design of an open-label, dose-escalation, Phase 2 safety and efficacy study of its lead product candidate, trans sodium crocetinate ("TSC"), administered with standard of care to patients newly diagnosed with glioblastoma multiforme. The trial, which has been designated Study 200-208, has been designed to incorporate an innovative use of positron emission tomography ("PET") to map hypoxia within the tumor. The use of PET is designed to allow the Company to directly quantify the effects of TSC on tumor hypoxia, and thereby test TSC’s ability to enhance oxygen within the tumor microenvironment. These initial imaging readouts are expected to be available within one year of study initiation, thereby providing objective surrogate data readouts significantly faster than historical clinical trials in patients with GBM. The Company expects to initiate the trial by the end of 2022 with the first patient dosed in the first quarter of 2023.

Reported Positive Results from Altitude Trial: In June 2022, positive results were reported from the Company’s Altitude Trial. The data suggested that a higher dose of TSC (2.5 mg/kg dose) decreased blood acidity (lower lactate accumulation) and enhanced metabolic recovery at 10 minutes after completion of exercise under the stressful conditions of simulated high altitude and exercise. Additionally, positive changes were observed in blood markers of oxygen utilization, indicating that TSC may enhance oxygen availability at the cellular level, reinforcing Diffusion’s belief in the therapeutic potential of TSC.

"During the second quarter of 2022, we maintained significant momentum across our clinical and corporate programs achieving clinical and operational milestones we believe will help build Diffusion’s long-term success. Specifically, we were pleased to report positive results from our Altitude Trial, which we believe support our plans for further development of TSC to treat hypoxic solid tumors like GBM," commented Robert Cobuzzi, Jr., Ph.D., President and Chief Executive Officer of Diffusion. "Additionally, we are very pleased to have reached alignment with the FDA on an innovative GBM Trial design, and our team is already working to initiate the trial. We believe TSC has the potential to enhance the effectiveness of available treatment of this devastating disease."

Business Updates

Appointed Raven Jaeger, M.S., as Chief Regulatory Officer: In May 2022, Diffusion appointed Ms. Raven Jaeger as the Company’s Chief Regulatory Officer. Ms. Jaeger will, among other things, oversee the development and implementation of regulatory and related strategies to support the development and commercialization of Diffusion’s product development candidates.

Ended Quarter with $28.5 Million in Cash, Cash Equivalents and Marketable Securities with Expected Cash Runway into First Quarter of 2024

Research and development expenses in the second quarter of 2022 were $2.1 million, compared to $2.0 million in the prior year period. There was a decrease in costs associated with clinical trials and drug manufacturing, offset by an increase in salaries and wages and stock-based compensation related to increased headcount.

General and administrative expenses were $2.1 million during the second quarter of 2022 versus $1.8 million in the comparable quarter last year. The increase reflects a rise in professional fees related to the reverse stock split that occurred in April 2022, as well as increased salary expenses related to additional headcount.

As of June 30, 2022, Diffusion had $28.5 million in cash, cash equivalents, and marketable securities, which the Company currently expects will enable it to fund its operating expenses and capital expenditure requirements into the first quarter of 2024, without giving effect to any business development activities the Company may undertake.

On August 11, 2022 Brickell Biotech, Inc. ("Brickell" or the "Company") (Nasdaq: BBI), a clinical-stage pharmaceutical company striving to transform patient lives by developing innovative and differentiated prescription therapeutics for the treatment of autoimmune, inflammatory, and other debilitating diseases, reported financial results for the second quarter ended June 30, 2022 and provided a corporate update (Press release, Vical, AUG 11, 2022, View Source [SID1234618220]).

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"Advancement of BBI-02 into the clinic is a significant milestone for our company as it marks the first time a DYRK1A inhibitor intended for patients with autoimmune diseases has been orally administered in humans," commented Robert Brown, Chief Executive Officer of Brickell. "We are pleased with the progress in the Phase 1 study and remain on track to initiate the MAD part of the study next month and report SAD and MAD topline results by early 2023."

Research and Development Highlights

BBI-02: a potential first-in-class DYRK1A inhibitor for the treatment of autoimmune and inflammatory diseases

Continue to enroll and dose patients in the Phase 1 clinical trial of BBI-02 (BBI-02-101) in Canada, a randomized, double-blind, placebo-controlled study designed to evaluate the safety, tolerability, pharmacokinetics, and pharmacodynamics of BBI-02 capsules in both healthy subjects and patients with atopic dermatitis (AD).
Part 1A of the study is a single ascending dose (SAD) assessment of BBI-02 capsules or placebo in healthy subjects. Part 1B of the study will be a multiple ascending dose (MAD) assessment of BBI-02 capsules or placebo administered once daily for 14 days in healthy subjects. Part 2 of the study will compare BBI-02 to placebo in patients with moderate-to-severe AD over 28 days of dosing and will include a preliminary assessment of efficacy. Additional information on this clinical trial can be found on www.clinicaltrials.gov under identifier NCT05382819.
The Company expects to initiate the MAD assessment next month and remains on track to report topline results from the SAD and MAD parts of the Phase 1 trial by early 2023.
BBI-10: a covalent Stimulator of Interferon Genes (STING) inhibitor for the potential treatment of autoimmune, inflammatory, and rare genetic diseases

Preclinical development activities for BBI-10, the Company’s lead STING inhibitor candidate, are underway.
Next-Generation Kinase Inhibitors: a cutting-edge platform with the potential to produce treatments for autoimmune, inflammatory, and other debilitating diseases

The Company is engaged in research to identify both brain penetrant and non-brain penetrant kinase inhibitors from the Company’s library of novel compounds, including next-generation DYRK1A inhibitors and other new chemical entities that specifically inhibit LRRK2, TTK, and CLK kinases.
A number of these drug candidates have the potential to penetrate the blood brain barrier, presenting an opportunity to address neuroinflammatory conditions of high unmet need such as Down Syndrome, Alzheimer’s Disease, and Parkinson’s Disease, while other peripherally acting novel LRRK2, TTK, and CLK kinase inhibitors could be developed in additional therapeutic areas within autoimmunity, inflammation, and oncology.
Recent Corporate Highlights

On July 5, 2022, Brickell effected a 1-for-45 reverse stock split of the Company’s common stock. Proportional adjustments were also made to the number of shares of Brickell’s common stock subject to outstanding equity awards and warrants, as well as the applicable exercise price(s). The purpose of the 1-for-45 reverse stock split was to raise the per-share trading price of the Company’s common stock to regain compliance with the $1.00 per share minimum bid price requirement for continuous listing on The Nasdaq Capital Market ("Nasdaq"). On July 19, 2022, the Company received formal notice from Nasdaq stating that the Company had regained compliance with the minimum bid price requirement for continued listing on Nasdaq, and, accordingly, the previously-scheduled hearing regarding the delisting action had been canceled and the Company’s common stock will continue to be listed and traded on Nasdaq.

On May 3, 2022, Brickell signed and closed a definitive asset purchase agreement ("APA") with Botanix SB Inc., a subsidiary of Botanix Pharmaceuticals Limited (ASX: BOT) ("Botanix"). Under the terms of the APA, Botanix acquired all of Brickell’s rights and assets primarily related to sofpironium bromide. In exchange, Brickell received $3.0 million at closing and is eligible to receive from Botanix potential near-term regulatory milestone payments of (a) $2.0 million upon the acceptance by the U.S. Food and Drug Administration of a new drug application ("NDA") submission for sofpironium bromide gel, 15%, and (b) $4.0 million if marketing approval in the U.S. for sofpironium bromide gel, 15%, is received on or before September 30, 2023, or $2.5 million if such marketing approach is received after September 30, 2023 but on or before February 17, 2024. Brickell also is eligible to receive additional success-based regulatory and sales milestone payments of up to $168 million and tiered earnout payments ranging from high-single digits to mid-teen digits on net sales of sofpironium bromide gel. Certain of these amounts are subject to payments by Brickell to its former licensor. Brickell additionally will receive certain payments from sales by its former sublicensee, Kaken Pharmaceutical Co. ("Kaken"). Under the APA, Botanix is responsible for all further research, development, and commercialization of sofpironium bromide globally. In connection with the sale of sofpironium bromide, Brickell and Botanix entered into a transition services agreement ("TSA") whereby Brickell is providing consulting services to Botanix as an independent contractor through filing and potential approval of the U.S. NDA for sofpironium bromide gel, 15%. Botanix has reported that it plans to submit the NDA for sofpironium bromide gel, 15% in the third quarter of 2022.

Second Quarter 2022 Financial Results

The Company reported cash and cash equivalents of $14.5 million as of June 30, 2022, compared to $26.9 million as of December 31, 2021. The Company expects its cash and cash equivalents as of June 30, 2022, combined with $2.0 million from expected near-term payments under the APA with Botanix, will support its operations for at least the next 12 months.

Revenue was $4.3 million for the second quarter of 2022, compared to $0.2 million for the second quarter of 2021. Revenue for the three months ended June 30, 2022 consisted of contract revenue recognized under the APA and TSA with Botanix, while revenue for the three months ended June 30, 2021 was driven by royalty revenue earned on a percentage of net sales of ECCLOCK in Japan under the Kaken agreement. Contract revenue for the three months ended June 30, 2022 consisted of an upfront payment from Botanix of $3.0 million, reimbursed development expenditures from Botanix under the APA of $0.6 million, fees for consulting services the Company provided under the TSA of $0.4 million, and sublicense income under the APA of $0.3 million.

Research and development expenses were $1.9 million for the second quarter of 2022, compared to $8.8 million for the second quarter of 2021, which decrease was driven primarily by lower clinical expenses related to sofpironium bromide, partially offset by increased clinical costs for BBI-02. Throughout 2021, the Company was executing its U.S. Phase 3 pivotal clinical program for sofpironium bromide gel, 15%, which concluded in the fourth quarter of 2021. During the second quarter of 2022, the Company initiated its Phase 1 clinical trial for BBI-02 and began incurring research and development expenses related to the clinical trial.

General and administrative expenses were $3.9 million for the second quarter of 2022, compared to $2.9 million for the second quarter of 2021. The increase was primarily related to expenses incurred in the second quarter of 2022 associated with entering into the APA and higher legal, compensation, and other administrative fees.

Brickell’s net loss was $1.1 million for the second quarter of 2022 compared to $11.1 million for the second quarter of 2021.

Conference Call and Webcast Information

Brickell’s management will host a conference call today at 4:30 p.m. EDT to discuss the financial results and recent corporate developments. The dial-in number for the conference call is 1-844-826-3035 for domestic participants and 1-412-317-5195 for international participants, with Conference ID #: 10168280. A live webcast of the conference call can be accessed at (click here) or through the Investors section of the Brickell website at View Source A replay will be available on this website shortly after conclusion of the event for approximately 90 days.