Theralase(R) Announces 1Q2024 Financial Results

Theralase Technologies Inc., a clinical-stage pharmaceutical company focused on developing light and/or radiation-activated Photo Dynamic Compounds (PDCs) to combat various cancers, bacteria, and viruses, has unveiled its unaudited interim consolidated financial statements for the first quarter of 2024. 

Financial Performance

Theralase reported a 15% year-over-year decline in total revenue for Q1 2024. The cost of sales amounted to $113,440, representing 65% of total revenue and resulting in a gross margin of $62,114, or 35% of total revenue. This is a decrease from the same period in 2023, where the cost of sales was $114,638, which accounted for 55% of total revenue, resulting in a gross margin of $92,523, or 45% of total revenue. The decline in gross margin percentage is primarily due to an increase in material costs.

Selling expenses were reduced by 10% to $67,552 from $74,671 in the same period in 2023. Administrative expenses also saw a slight decrease, falling to $511,495 from $522,695, a 2% reduction. The decrease in administrative expenses is attributed to reduced spending on general and administrative costs, insurance, and stock-based compensation.

Research and development (R&D) expenses for the Drug Division saw a significant reduction, dropping to $725,017 from $907,099, marking a 20% decrease. This decline is mainly due to lower costs associated with patient enrollment and treatment in Study II. Conversely, R&D expenses for the Device Division increased to $31,363 from $3,181, an 886% rise due to the development of new software for the TLC-2000 Cool Laser Therapy system.

The net loss for Q1 2024 was $1,266,711, which included $220,919 in net non-cash expenses such as amortization and stock-based compensation. This compares favorably to a net loss of $1,408,953 in the same period in 2023, a 10% reduction. The Drug Division was responsible for $1,011,762 of the total loss.

Operational Highlights

Theralase closed a non-brokered private placement of units on April 24, 2024, issuing 4,167,778 units at $0.18 per unit for gross proceeds of around $750,200. Each unit consists of one common share and one non-transferable common share purchase warrant, which allows the holder to purchase an additional common share at $0.25 for five years from the issuance date.

The company plans to secure further funding in 2024 through various equity and debt instruments to ensure it can complete enrollment in Study II by year-end, achieve data lock by mid-2026, and position itself for FDA and Health Canada approval by the end of 2026, contingent on obtaining FDA Priority Review.

Study II Updates

Dr. Michael Jewett joined Theralase as an independent consultant to aid in patient enrollment for Study II. To date, 68 patients have received the primary study treatment, with new patients expected to enroll in Q2 2024. Theralase aims to add up to five new Clinical Study Sites (CSSs) in 2024, in addition to increasing enrollment at the existing 10 CSSs.

Breakthrough Designation and Clinical Data

Theralase submitted a pre-Breakthrough Designation (BTD) application to the FDA in July 2023 and is currently updating it based on FDA feedback. The company expects to resubmit the pre-BTD in Q2/Q3 2024. Preliminary Study II clinical data shows promising results: 63% of patients treated with Theralase's Study Procedure achieved a Complete Response (CR), and 33% maintained CR for 15 months post-treatment. No Serious Adverse Events (SAEs) have been directly linked to the Study Drug or Study Device.

About Theralase and Study II

Theralase is dedicated to developing light-activated compounds and their associated drug formulations to destroy various cancers, bacteria, and viruses. Study II focuses on treating approximately 100 Bacillus Calmette-Guérin (BCG)-Unresponsive Non-Muscle Invasive Bladder Cancer (NMIBC) patients in up to 15 CSSs across Canada and the United States.

Conclusion

The interim clinical data from Study II indicates a high potential for Theralase's technology to provide effective, safe treatment options for bladder cancer. The company continues to make significant strides in its research and development efforts, with promising financial and operational performance in the first quarter of 2024.

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