On May 12, 2022 Citius Pharmaceuticals, Inc. ("Citius" or the "Company") (Nasdaq: CTXR), a late-stage biopharmaceutical company developing and commercializing first-in-class critical care products, reported business and financial results for the second fiscal quarter of 2022 ended March 31, 2022 (Press release, Citius Pharmaceuticals, MAY 12, 2022, View Source [SID1234614432]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Fiscal Q2 2022 Business Highlights and Subsequent Developments

Engaged global clinical research organization (CRO) to expand Mino-Lok Phase 3 trial to include additional trial sites outside the U.S.;
Reported topline results of Phase 3 trial of I/ONTAK (E7777) with no new safety signals and consistent with prior formulation (ONTAK); biologics license application (BLA) submission on track for the second half of 2022; and,
Initiated Halo-Lido Phase 2b trial with first patient dosed in April 2022 and anticipated enrollment completion by end of 2022.
Financial Highlights

Cash and cash equivalents of $55.8 million as of March 31, 2022;
R&D expenses were $3.5 million and $8.9 million for the three and six months ended March 31, 2022, respectively, compared to $1.6 million and $7.7 million for the three and six months ended March 31, 2021, respectively;
G&A expenses were $3.1 million and $6.0 million for the three and six months ended March 31, 2022, respectively, compared to $2.3 million and $ 4.0 million for the three and six months ended March 31, 2021, respectively;
Stock-based compensation expense was $1.0 million and $1.9 million for the three and six months ended March 31, 2022, respectively, compared to $0.3 million and $0.6 million for the three and six months ended March 31, 2021, respectively; and,
Net loss was $7.6 million and $16.8 million, or ($0.05) and ($0.11) per share for the three and six months ended March 31, 2022, respectively, compared to a net loss of $4.1 million and $12.3 million, or ($0.04) and ($0.16) per share for the three and six months ended March 31, 2021, respectively.
"We continue to make significant progress with our three clinical development programs. To date in 2022, we actively engaged with our U.S. Mino-Lok trial sites to drive increased enrollment as COVID-19 infections waned, engaged an additional CRO to expand Mino-Lok patient recruitment to sites outside the U.S., announced topline results for the Phase 3 trial of I/ONTAK that were consistent with the prior FDA-approved formulation (ONTAK), and initiated a Phase 2b study of Halo-Lido for patients suffering from hemorrhoids. Moreover, we expect additional important catalysts from these programs in the second half of the calendar year as we remain on track with a BLA submission for I/ONTAK in the second half of 2022, and expect to complete enrollment in the Mino-Lok and Halo-Lido trials by the end of the year," stated Leonard Mazur, Chairman and CEO of Citius.

"Covid-19 remains an enduring challenge worldwide. Although our Mino-Lok trial has been impacted, we are actively engaging with existing sites to drive enrollment during periods of waning infection, and expanding recruitment sites outside the U.S. to mitigate the risk of future Covid-19 waves. Our aim is to achieve the events required to complete the Mino-Lok trial this year," added Mr. Mazur.

"The Citius balance sheet remains healthy with $55.8 million in cash available to execute our near-term plans. As stewards of Citius shareholders’ capital, we focus on creating long-term value in the business and will continue to evaluate all strategic and financial options available to us. These may include non-equity financing, out-licensing agreements, asset sales or other strategic arrangements that would support the commercialization of our two late-Phase 3 assets," concluded Mr. Mazur.

SECOND QUARTER ENDED MARCH 31, 2022 Financial Results:

Liquidity

As of March 31, 2022, the Company had $55.8 million in cash and cash equivalents and no debt.

As of March 31, 2022, the Company had 146,129,630 common shares issued and outstanding.

The Company estimates that its available cash resources will be sufficient to fund its operations through March 2023.

Research and Development (R&D) Expenses

R&D expenses were $3.5 million and $8.9 million for the three and six months ended March 31, 2022, respectively, compared to $1.6 million and $7.7 million for the comparable periods ended March 31, 2021. The increase during the quarter is primarily due to additional R&D expenses related to I/ONTAK which Citius in-licensed in September 2021, and start-up costs associated with the Halo-Lido Phase 2b trial, offset by decreases in Mino-Lok R&D expenses.

During the six months ended March 31, 2022, ARDS-related R&D expenses decreased by $4.7 million compared to $5.3 million during the prior year period. R&D expense for the six months ended March 31, 2021 reflected a $5.0 million license fee paid to Novellus.

We expect that research and development expenses will increase in fiscal 2022 as we continue to focus on our Phase 3 trials for Mino-Lok and I/ONTAK, progress the Halo-Lido product candidate, and continue our research and development efforts related to ARDS and Mino-Wrap.

General and Administrative (G&A) Expenses

G&A expenses were $3.1 million and $6.0 million for the three and six months ended March 31, 2022, respectively, compared to $2.3 million and $4.0 million for the comparable periods ended March 31, 2021. The increase is primarily due to additional compensation costs for new employees, increased investor relations costs and additional insurance expense. General and administrative expenses consist primarily of compensation costs, professional fees for legal, regulatory, accounting, and corporate development services, and investor relations expenses.

Stock-based Compensation Expense

For the fiscal quarter ended March 31, 2022, stock-based compensation expense was $1.0 million as compared to $0.3 million for the prior year period. For the six months ended March 31, 2022, stock-based compensation expense was $1.9 million as compared to $0.6 million for the six months ended March 31, 2021. The increase primarily reflects expenses related to new grants made by Citius to employees (including new hires), directors and consultants.

Net loss

Net loss was $7.6 million, or ($0.05) per share for the three months ended March 31, 2022, compared to a net loss of $4.1 million, or ($0.04) per share for the three months ended March 31, 2021.

Net loss was $16.0 million, or ($0.11) per share for the six months ended March 31, 2022, compared to a net loss of $12.2 million, or ($0.16) for the six months ended March 31, 2021.

The increase in net loss is primarily due to an increase in research and development and general and administrative expenses.