Sol-Gel Announces Q2 2024 Financial Results and Corporate Updates

Sol-Gel Technologies, Ltd. (NASDAQ: SLGL), a dermatology company specializing in treatments for severe skin conditions, has announced its financial results for the second quarter ending June 30, 2024. The company is actively engaged in Phase 3 clinical trials for SGT-610 (patidegib gel, 2%) aimed at treating Gorlin syndrome and is progressing with its proof-of-concept study for SGT-210, targeting Darier disease.

On August 15, 2024, Sol-Gel entered a new agreement with Padagis, which supersedes their previous collaboration for developing and commercializing a generic version of Zoryve® Cream (roflumilast cream 0.3%). Under the new terms, Sol-Gel will receive unconditional quarterly payments over 24 months and low single-digit royalties from sales of the cream for five years. This move is expected to improve Sol-Gel's cash position by approximately $6 million, as it also eliminates future development costs associated with the prior agreement.

In July 2024, Sol-Gel signed six initial license agreements for its products TWYNEO® and EPSOLAY® with partners in Europe and South Africa. The company is also in discussions to establish additional deals in Latin America, Australia, New Zealand, South Korea, Spain, Italy, and Portugal. These agreements are projected to generate up to $3.7 million in upfront and regulatory milestone payments, which Sol-Gel plans to use in adapting its products to meet the regulatory requirements of these new markets. TWYNEO and EPSOLAY are expected to launch in the majority of these new territories by 2026 and 2027, respectively, potentially generating annual royalty revenues of up to $10 million by 2030.

The ongoing Phase 3 study for SGT-610 involves approximately 140 subjects across 42 clinical centers. Agreements have been signed with 39 centers, and 29 of these are currently active. The top-line results are anticipated by the second quarter of 2026. If approved, SGT-610 would be the first product to prevent new basal cell carcinoma (BCC) lesions in Gorlin syndrome patients, targeting a market valued at over $300 million annually.

Sol-Gel’s proof-of-concept study for SGT-210, designed for patients with Darier disease, a significant unmet medical need, is also ongoing. If successful, the market potential for this treatment is estimated between $200 and $300 million. Sol-Gel plans to file for a Phase 2 investigational new drug (IND) application by the second quarter of 2025.

Effective January 1, 2025, subject to shareholder approval, Mr. Mori Arkin, Sol-Gel’s executive chairman and controlling shareholder, will take on the role of interim CEO. Mr. Arkin has extensive experience in the pharmaceutical and dermatological industries. He will transition away from most of his other business activities to focus on his new role at Sol-Gel. Current CEO Dr. Alon Seri-Levy will step down on December 31, 2024, but will continue to serve as a consultant for at least one year.

In addition, Mr. Eyal Ben-Or has been appointed as Sol-Gel’s Chief Financial Officer (CFO) as of July 12, 2024. Mr. Ben-Or previously worked at Mobileye and KPMG Israel and holds an MBA and a BA in accounting.

Sol-Gel reported a net income of $1.9 million for the second quarter of 2024, with earnings of $0.07 per share, compared to a net loss of $6.0 million for the same period in 2023. As of June 30, 2024, the company had $15.6 million in cash and equivalents and $14.9 million in marketable securities, totaling $30.5 million. The company expects its cash resources to fund operations into the first quarter of 2026.

TWYNEO, a topical cream for acne vulgaris, and EPSOLAY, a benzoyl peroxide cream for rosacea, utilize proprietary silica-based encapsulation technologies for improved efficacy and tolerability. SGT-610, another key asset, targets the prevention of BCCs in Gorlin syndrome patients by inhibiting the hedgehog signaling pathway. SGT-210 aims to treat Darier disease and other hyperkeratosis-related disorders through its topical formulation of erlotinib, a tyrosine kinase inhibitor.

Sol-Gel remains committed to advancing its innovative dermatology treatments and exploring opportunities for non-dilutive funding to further extend its cash runway.