New Chinese patent notice of allowance issued covering opaganib in combination with immune checkpoint inhibitors (ICIs) as a method of inducing an anti-cancer immune response[1]. Provides protection for opaganib's potential use in combination with a range of approved and in-development (ICIs) across a growing range of indications[2] through 2040 ICIs have become a cornerstone in cancer treatment, having been hailed as a major breakthrough by oncologists, with the global ICI market expected to exceed $100 bi ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 For the month of April 2024 Commission File No.:001-35773 REDHILL BIOPHARMA LTD. (Translation of registrant's name into English) 21 Ha'arba'a Street, Tel Aviv, 6473921, Israel (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or For ...

Financial Position and Capital Needs - As of December 31, 2023, the company had a cash balance of approximately $6.5 million, including $0.8 million of restricted cash held in an escrow account[30]. - The net cash used in operating activities for the year ended December 31, 2023, was $35.8 million, raising substantial doubt about the company's ability to continue as a going concern[30]. - The company needs to raise significant additional capital to finance its operations and achieve strategic objectives, particularly after losing revenue from Movantik®[40]. - The company may need to raise additional capital due to insufficient revenues from current and future commercial products to cover operating expenses[42]. - The company must secure additional funding if resource consumption exceeds current expectations, potentially leading to earlier funding needs[1]. Revenue and Business Operations - Following the sale of Movantik®, the company lost its primary revenue source, significantly impacting its ability to operate as a financially viable commercial business[34]. - The company has downsized its commercial operations due to the loss of economies of scale following the sale of Movantik®, which has adversely affected its ability to sell commercial products[34]. - The company plans to fund future operations through the commercialization of Talicia® and Aemcolo®, as well as through equity or debt financing[40]. - The company reported a net income of approximately $23.9 million for the twelve months ended December 31, 2023, compared to a net loss of $71.7 million for the same period in 2022 and a net loss of $97.7 million for 2021[58]. - As of December 31, 2023, the company had an accumulated deficit of approximately $407.7 million[58]. Regulatory and Compliance Challenges - Internal control over financial reporting was deemed ineffective as of December 31, 2023, which could harm investor confidence and the company's financial reporting[48]. - The company is subject to various regulatory requirements that could impact its marketing and promotional activities, including compliance with FDA and FTC regulations[64][66]. - The company must obtain and maintain regulatory approvals for its products; failure to do so could prevent commercialization of its therapeutic candidates[131]. - Regulatory compliance failures could lead to sanctions, including fines, product recalls, or withdrawal of marketing approvals[155]. - The company is subject to ongoing regulatory review, and failure to comply could result in loss of approvals and adverse effects on operations[149]. Clinical Development and Trials - The company is required to complete two additional postmarketing studies for Aemcolo® in pediatric populations, with deadlines extended to January 2025 for completion and December 2025 for final report submissions due to COVID-19 impacts[74][76]. - The company faces challenges in recruiting patients for clinical trials, particularly in pediatric and oncology studies, which may affect the completion of these studies[1]. - Clinical trials are lengthy and expensive, with uncertain outcomes, and prior results may not predict future trial success[159]. - The company relies on third parties for clinical trials, which may not perform satisfactorily, leading to delays and increased costs[166]. Market Competition and Product Commercialization - The company faces competition from larger pharmaceutical companies with greater financial capabilities and marketing resources[101]. - Talicia® competes with several branded and generic therapies for H. pylori treatment, and Aemcolo® faces competition from both branded drugs and generic antibiotics[192]. - The pharmaceutical and biotechnology industry is highly competitive, with significant competition from various companies developing similar therapeutic candidates[189]. - The market for current commercial products and therapeutic candidates is rapidly changing, with new drug delivery technologies potentially rendering existing products noncompetitive[188]. Strategic Transactions and Partnerships - The company is actively pursuing strategic business transactions, including potential divestment of certain assets, to raise additional capital[40]. - The company has acquired rights to Talicia®, Aemcolo®, and five clinical-stage therapeutic candidates, indicating a strategy focused on in-licensing and acquisitions for commercial success[117]. - The company relies on third-party collaborators for manufacturing and commercialization, which exposes it to risks related to compliance and operational difficulties[81][82]. - The company may need to alter or abandon its development and commercialization plans if it fails to establish collaborations or raise substantial additional capital[116]. Financial and Market Risks - The healthcare industry faced a challenging market during 2023, impacting the company's ability to raise capital and secure partners for development or commercialization[42]. - The company may incur higher than expected costs in the commercialization of its products, which could adversely affect its financial condition[96]. - Unexpected product safety or efficacy concerns could lead to product recalls or declining sales, adversely affecting market acceptance[199]. - The company faces uncertainty regarding future healthcare regulations and their potential adverse effects on product approval and commercialization[211]. Legislative and Regulatory Environment - The financial impact of U.S. healthcare reform legislation will depend on various factors, including changes in sales volumes for therapeutics affected by the legislation[206]. - The American Rescue Plan Act of 2021 eliminates the statutory Medicaid drug rebate cap for single source drugs and innovator multiple source drugs, effective January 1, 2024[209]. - The Inflation Reduction Act of 2022 requires manufacturers of certain drugs to engage in price negotiations with Medicare starting in 2026 and imposes rebates under Medicare Part B and Part D for price increases that exceed inflation, first due in 2023[210]. - Heightened scrutiny over drug pricing practices has led to proposed legislation aimed at increasing transparency and controlling pharmaceutical pricing[222].

Table of Contents Exhibit 99.2 REDHILL BIOPHARMA LTD. CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION (UNAUDITED) June 2023 Table of Contents REDHILL BIOPHARMA LTD. CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION (UNAUDITED) June 30, 2023 TABLE OF CONTENTS REDHILL BIOPHARMA LTD. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) | | Six Months Ended | | | --- | --- | --- | | | June 30, | | | | 2023 | 2022 | | | U.S. dollars in thousands | | | NET REVENUES | 5,395 ...

Financial Condition and Viability - The company reported a net cash used in operating activities of $29.2 million for 2022, leaving a cash balance of $36.1 million, which includes $16 million of restricted cash[25]. - Following the sale of rights to Movantik®, the company lost its primary revenue source, significantly impacting its ability to operate as a financially viable business[29]. - The company has substantial doubt about its ability to continue as a going concern due to insufficient resources to fund operations for the next twelve months[25]. - As of December 31, 2022, the company had cash, cash equivalents, short-term investments, and restricted cash totaling approximately $36.1 million, down from $54.2 million in 2021[35]. - The company has obligations estimated at approximately $51 million related to pre-closing liabilities from the Movantik® sale, which it must fulfill using available resources[30]. - The company has a history of operating losses and may continue to incur significant losses in the coming years, with no assurance of generating substantial positive cash flow or profitability[46]. - As of December 31, 2022, the company reported an accumulated deficit of approximately $433.9 million, with net losses of approximately $71.7 million in 2022, $97.7 million in 2021, and $76.2 million in 2020[49]. Internal Controls and Compliance - The company’s management concluded that its internal control over financial reporting was not effective as of December 31, 2022, which could harm shareholder confidence[39]. - The company has identified material weaknesses in its internal control over financial reporting, which may affect investor confidence and the trading price of its shares[42]. - The company may incur additional costs related to compliance with Section 404 and may face sanctions or investigations by regulatory authorities if internal controls are not effective[45]. Product Development and Commercialization - The company plans to fund future operations through commercialization of Talicia® and Aemcolo®, out-licensing of therapeutic candidates, and raising significant additional capital[36]. - The company’s ability to generate sufficient revenues to sustain operations depends on successfully commercializing current products and obtaining regulatory approvals for therapeutic candidates[53]. - The company’s first and only product, Talicia®, was developed internally and approved for marketing by the FDA, but there are challenges in achieving market acceptance and generating meaningful revenues[60]. - The company may face difficulties in expanding its commercialization capabilities, including the need to recruit and train adequate personnel for sales and marketing[63]. - The company is actively pursuing in-licenses or acquisitions of additional therapeutic candidates to achieve commercial success, but faces competition and risks in these endeavors[109]. Regulatory and Market Challenges - The company faces challenges in securing reimbursement for its products, which is critical for commercial success[88]. - Regulatory changes could materially delay or impair the ability to commercialize products and obtain necessary approvals[132]. - The company is subject to ongoing regulatory review and must comply with FDA and foreign regulations, which could impact the commercialization of current and future products[137]. - The company may face significant delays in obtaining FDA approval for therapeutic candidates due to issues related to chemistry, manufacturing, and controls (CMC)[147]. - The company may incur substantial expenses and delays in obtaining FDA approval for its therapeutic candidates, including RHB-104 for Crohn's disease[148]. Competition and Market Dynamics - The biotechnology sector is highly competitive, with numerous companies developing COVID-19 treatments, which may limit the commercial opportunity for the company's therapeutic candidates[172]. - Talicia® faces competition from both branded and generic therapies for H. pylori treatment, which may limit its market share[193]. - The company may not achieve commercial viability for its therapeutic candidates, as none other than Talicia® are currently approved for marketing[198]. Impact of COVID-19 - The COVID-19 pandemic has caused significant volatility and uncertainty in U.S. and international markets, adversely affecting the company's business and revenues[182]. - The pandemic has adversely affected clinical trials, including slow patient enrollment for the Phase 3 study with RHB-204, potentially delaying development timelines[186]. - Supply chain disruptions due to the pandemic may impact the company's ability to distribute products and meet customer demand, affecting financial condition[189]. Strategic Partnerships and Collaborations - The company relies on third-party collaborators for manufacturing and commercialization, which poses risks including potential defaults and compliance issues[75][76]. - Collaborative arrangements may not yield anticipated benefits, and reliance on partners could adversely affect commercialization efforts[75][78]. - The company has entered into several collaborations with U.S.-based partners to expand manufacturing capacity for opaganib in preparation for potential emergency use applications[178].

[Financial Performance](index=4&type=section&id=Financial%20Performance) Net revenues decreased in Q4 and full-year 2022 due to increased allowances, but significant cost reductions substantially lowered operating losses, leading to debt extinguishment and a $36.1 million cash balance - The company became **debt-free** after extinguishing all obligations with HCR through the sale of Movantik® rights[7](index=7&type=chunk)[8](index=8&type=chunk)[29](index=29&type=chunk) - A key focus on cost reduction successfully lowered operating losses significantly in 2022 compared to 2021[7](index=7&type=chunk)[15](index=15&type=chunk)[24](index=24&type=chunk) - The cash balance was **$36.1 million** as of December 31, 2022[7](index=7&type=chunk)[17](index=17&type=chunk) [Q4 2022 Financial Results](index=4&type=section&id=Financial%20results%20for%20the%20three%20months%20ended%20December%2031%2C%202022%20%28Unaudited%29) Q4 2022 saw net revenues decrease to $12.8 million due to higher allowances, while operating loss significantly improved to $9.9 million from $20.7 million due to expense reductions Q4 2022 vs. Q4 2021 Financials (in millions USD) | Metric | Q4 2022 | Q4 2021 | Change Driver | | :--- | :--- | :--- | :--- | | Net Revenues | $12.8 | $22.1 | Increased gross-to-net allowances | | Operating Loss | $9.9 | $20.7 | Cost-reduction measures | | R&D Expenses | $1.1 | $5.9 | Optimization and completion of COVID trials | | SG&A Expenses | $13.0 | $17.6 | Ongoing cost-reduction measures | | Net Cash Used in Operating Activities | $2.4 | $14.9 | Reduction in operating expenses | - The decrease in net revenues occurred despite prescription growth for Talicia and Movantik, primarily due to increased gross-to-net allowances[10](index=10&type=chunk) [Full-Year 2022 Financial Results](index=5&type=section&id=Financial%20results%20for%20the%2012%20months%20ended%20December%2031%2C%202022) Full-year 2022 net revenues decreased to $61.8 million due to Movantik allowances, but operating loss significantly reduced to $42.8 million from $81.1 million due to effective cost controls Full-Year 2022 vs. Full-Year 2021 Financials (in millions USD) | Metric | FY 2022 | FY 2021 | Change Driver | | :--- | :--- | :--- | :--- | | Net Revenues | $61.8 | $85.8 | Increased gross-to-net allowances (Movantik) | | Operating Loss | $42.8 | $81.1 | Reduction in operating expenses | | R&D Expenses | $7.3 | $29.5 | Optimization and completion of COVID trials | | SG&A Expenses | $64.0 | $88.0 | Cost-control measures, reduced salesforce | | Net Cash Used in Operating Activities | $29.2 | $65.0 | Lower operating loss and expenses | - The full-year revenue decline was primarily attributed to increased gross-to-net allowances, mainly related to Movantik[18](index=18&type=chunk) [Consolidated Financial Statements](index=12&type=section&id=Consolidated%20Financial%20Statements) Consolidated financial statements detail 2022 comprehensive loss, financial position, and cash flows, showing a $71.7 million net loss, $158.9 million in total assets, and a $48.4 million capital deficiency Consolidated Statement of Comprehensive Loss (in thousands USD) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Net Revenues | 61,800 | 85,757 | | Gross Profit | 28,463 | 36,351 | | Operating Loss | (42,844) | (81,135) | | Loss and Comprehensive Loss | (71,669) | (97,744) | | Loss Per Share (basic and diluted) | $0.12 | $0.21 | Consolidated Statement of Financial Position (in thousands USD) | Metric | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Assets | 158,870 | 181,188 | | Total Liabilities | 207,270 | 172,313 | | Total Equity (Capital Deficiency) | (48,400) | 8,875 | Consolidated Statement of Cash Flows (in thousands USD) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | (29,185) | (65,047) | | Net cash (used in) provided by investing activities | 8,302 | (8,140) | | Net cash provided by financing activities | 11,453 | 73,462 | [Operational and Business Highlights](index=6&type=section&id=Operational%20and%20Business%20Highlights) Strategic highlights include debt extinguishment via Movantik sale, Nasdaq compliance, and capital raises, alongside strong Talicia® growth and R&D advancements for Opaganib and RHB-102 [Business Updates](index=6&type=section&id=Business%20updates) Key business updates include debt extinguishment via Movantik sale, regaining Nasdaq compliance, and successful capital raises through direct and public offerings - All debt obligations with HealthCare Royalty (HCR) were extinguished by transferring Movantik® rights, with RedHill providing up to 12 months of paid transition services[29](index=29&type=chunk) - Compliance with Nasdaq's minimum bid price requirement was regained following an American Depositary Shares (ADS) ratio change[27](index=27&type=chunk) - A **$6 million** registered direct offering closed in April 2023, and an approximately **$8.0 million** underwritten public offering closed in December 2022[28](index=28&type=chunk)[30](index=30&type=chunk) [Commercial Highlights](index=7&type=section&id=Commercial%20Highlights) Talicia® showed strong commercial growth with a 57% prescription increase and a new warranty, Aemcolo® gained extended exclusivity, and Movantik® rights were transferred to extinguish debt - Talicia® achieved **57% year-over-year prescription growth** and is projected to be the most prescribed branded H. pylori therapy in the U.S. in 2023[34](index=34&type=chunk) - A first-of-its-kind warranty program for Talicia® commits to reimbursing patient out-of-pocket costs if treatment is ineffective[8](index=8&type=chunk)[34](index=34&type=chunk) - Aemcolo® received an additional **five years of FDA exclusivity**, extending its regulatory protection through 2028[35](index=35&type=chunk) - Movantik® ownership was transferred to an HCR affiliate on February 6, 2023, extinguishing all of RedHill's debt[39](index=39&type=chunk) [R&D Pipeline Highlights](index=8&type=section&id=R%26D%20Highlights) R&D pipeline advanced with Opaganib selected by NIH for ARS and FDA guidance, RHB-102 planned for UK oncology application, and progress for RHB-107 and RHB-204 - Opaganib was selected by the NIH's RNCP for development as a potential treatment for Acute Radiation Syndrome (ARS)[7](index=7&type=chunk)[39](index=39&type=chunk) - The FDA provided guidance for opaganib's ARS development under the Animal Rule, utilizing animal efficacy studies and offering potential for a Priority Review Voucher[7](index=7&type=chunk)[39](index=39&type=chunk) - Following a positive pre-MAA meeting with the UK's MHRA, the company plans to submit a Marketing Authorisation Application for RHB-102 (Bekinda) for oncology support[7](index=7&type=chunk)[42](index=42&type=chunk) - RHB-204 (for NTM disease) received a Notice of Allowance for a U.S. patent, with protection expected through **2041**[42](index=42&type=chunk) - RHB-107 (upamostat) showed a **100% reduction in hospitalization** due to COVID-19 in a Phase 2 study[42](index=42&type=chunk)

Financial Performance - Net revenues for Q2 2022 were $18.346 million, a decrease of 14.3% compared to $21.502 million in Q2 2021[6] - Gross profit for the first half of 2022 was $16.162 million, down 23.8% from $21.234 million in the same period of 2021[6] - The company reported a comprehensive loss of $11.711 million for Q2 2022, a decrease of 59.8% from $29.121 million in Q2 2021[6] - The loss per ordinary share for the first half of 2022 was $0.06, compared to $0.12 in the same period of 2021[6] - Movantik® revenues decreased to $16.125 million for the three months ended June 30, 2022, down from $19.212 million in the same period of 2021, representing a decline of approximately 11%[58] - The company reported total net revenues of $18.346 million for the three months ended June 30, 2022, compared to $21.502 million for the same period in 2021, reflecting a decrease of about 14%[58] - The company recorded a consolidated comprehensive loss of $11.711 million for the three months ended June 30, 2022, compared to a loss of $29.121 million in the same period of 2021, showing an improvement of about 60%[65] - The financial expense of $2.552 million for the three months ended June 30, 2022, compared to $4.235 million in the same period of 2021, reflecting a decrease of approximately 40%[65] Expenses and Cost Management - Research and development expenses significantly decreased to $1.472 million in Q2 2022 from $10.328 million in Q2 2021, reflecting a reduction of 85.7%[6] - The operating loss for the first half of 2022 was $25.788 million, compared to $43.038 million in the first half of 2021, indicating a 40.0% improvement[6] Assets and Liabilities - Total assets as of June 30, 2022, were $167.967 million, down from $181.188 million at the end of 2021[9] - Current liabilities increased to $166.415 million as of June 30, 2022, compared to $81.470 million at the end of 2021[9] - The allowance for deductions from revenues increased to $39.223 million as of June 30, 2022, from $30.711 million as of January 1, 2022, indicating a rise of approximately 28%[49] Cash Flow and Financing - Cash and cash equivalents at the end of Q2 2022 were $26.988 million, down from $29.474 million at the end of 2021[9] - The company raised $15.508 million from the issuance of ordinary shares and warrants in Q2 2022, compared to $273,000 in Q2 2021[16] - The company sold 836,476 American Depositary Shares (ADSs) under its "at-the-market" equity offering program at an average price of $2.18 per ADS, resulting in net proceeds of approximately $1.8 million[42] - The company entered into a definitive agreement with a single investor, issuing 10,563,380 ADSs and granting warrants to purchase up to 13,204,225 ADSs for a total net consideration of $14.4 million[45] - HCRM exercised its rights to control RedHill Inc.'s account, transferring $16 million as minimum cash required under the Credit Agreement[70] - The $16 million Funds are classified as Restricted Cash in the financial position statements as of June 30[70] Strategic Initiatives and Agreements - An exclusive license agreement with Gaelan Medical Trade LLC for Talicia in the UAE resulted in an upfront payment of $2 million, with additional milestone payments and tiered royalties up to mid-teens on net sales[42] - The company recognized $2 million in revenue from the license of Talicia IP rights and manufacturing services during the six months ended June 30, 2022[41] Business Challenges and Outlook - Management expects to incur additional losses as it focuses on advancing the development of its therapeutic candidates and commercial operations, leading to negative cash flows from operating activities[19] - The COVID-19 pandemic has materially impacted the company's commercial activities, including launch sales and marketing for Talicia and sales of Aemcolo[27] - The company has sufficient supply on hand to meet U.S. commercial demand and clinical study needs despite the challenges posed by the COVID-19 pandemic[26] - The company has classified its borrowing as a current liability due to uncertainty regarding compliance with covenants under the Credit Agreement, raising substantial doubt about its ability to continue as a going concern[24] - RedHill Inc. is required to maintain minimum net sales of $75 million for the trailing four fiscal quarters ending June 30, 2022, and September 30, 2022, increasing to $90 million each fiscal quarter thereafter[11] Legal Matters - RedHill Inc. filed a lawsuit against Kukbo for defaulting on a $5 million payment under the Subscription Agreement[70] - An additional $1.5 million is due from Kukbo under the Exclusive License Agreement[70] - The lawsuit against Kukbo is being translated into Korean for filing in South Korea[70] - A summary judgment against Kukbo is expected to be entered in the United States within several weeks[70] Discussions and Negotiations - The company has entered discussions with HCR Collateral Management regarding a consensual business solution and is evaluating strategic alternatives to satisfy its outstanding obligations under the Credit Agreement[25] - The company is engaged in discussions with HCRM regarding alleged events of default under the Credit Agreement, while continuing to operate its business as usual[66]

Financial Data and Key Metrics Changes - RedHill reported net revenues of $18.2 million in Q1 2022, down from $22.1 million in Q4 2021, attributed to typical cyclical trends in Movantik sales [72] - Gross profit was $10.2 million in Q1 2022, representing a 56% gross margin, expected to improve as Talicia prescriptions grow [73] - Cash used in operating activities decreased by over 70% to approximately $4 million compared to approximately $15 million in Q4 2021, indicating a clear path towards financial independence [71] Business Line Data and Key Metrics Changes - Movantik achieved an 8.6% increase in prescription volume compared to Q1 2021, maintaining nearly 74% market share in the PAMORA class [27][35] - Talicia's prescription volume grew by 12.8% over Q4 2021 and 80% compared to Q1 2021, establishing it as the most prescribed branded H. pylori therapy in the U.S. [24][37] - The company achieved record quarterly prescription volume for both Movantik and Talicia in Q1 2022, with positive momentum continuing into Q2 [26][36] Market Data and Key Metrics Changes - Talicia became available to 14 million Medi-Cal beneficiaries as a preferred brand with no restrictions, enhancing its market access [38] - The company expects further prescription volume lift from improved payer coverage and recognition of Talicia's clinical benefits [40] Company Strategy and Development Direction - RedHill is focused on achieving earlier profitability, targeting positive cash from operations to start during the second half of 2022, with a comprehensive cost reduction plan expected to generate approximately $50 million in savings over the next 18 months [8][15] - The company is exploring potential acquisitions of revenue-generating synergistic products to expedite cash generation [12] - RedHill is committed to advancing its COVID-19 programs, opaganib and RHB-107, through external funding sources, emphasizing the need for oral therapeutics in the ongoing pandemic [19][50] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the current market reality but expressed confidence in the company's ability to achieve financial stability and growth [8][11] - The management highlighted the importance of cash preservation and generating cash flow as a priority, with a clear goal of achieving breakeven during the second half of the year [95] Other Important Information - The company has streamlined its U.S. commercial team workforce by approximately one-third as part of its cost reduction plan [9] - RedHill's R&D expenses decreased to $3.1 million in Q1 2022 from $5.9 million in Q4 2021, reflecting ongoing optimization of R&D costs [73] Q&A Session Summary Question: Impact of the reduction of the commercial team on overall sales - Management indicated that territories would be covered by remaining representatives and that a comprehensive analysis was conducted to optimize commercial operations [79][84] Question: Expected timeline for achieving $50 million in OpEx savings - Management provided a detailed plan indicating that savings would be realized over the next six quarters [86] Question: Competitive landscape for Talicia following a competitor's FDA approval - Management expressed confidence in Talicia's efficacy, particularly in addressing clarithromycin resistance, which is a significant issue in H. pylori treatment [91] Question: Cash flow positive from operations definition - Management clarified that cash flow positive includes all G&A and selling expenses, excluding stock compensation [106] Question: Current cash runway and operational profitability timeline - Management confirmed confidence in cash runway for the next 12 months and beyond, with plans to achieve operational profitability in the second half of the year [112]

RedHill Biopharma Ltd. (NASDAQ:RDHL) Q4 2021 Earnings Conference Call March 17, 2022 8:30 AM ET Company Participants Alexandra Okmian Sanderovich - Senior Business Development and Investor Relations Manager Dror Ben-Asher - Chief Executive Officer Guy Goldberg - Chief Business Officer Gilead Raday - Chief Operating Officer Rob Jackson - Senior VP, Sales & Marketing Micha Ben Chorin - Chief Financial Officer Conference Call Participants Brandon Folkes - Cantor Fitzgerald David Hoang - SMBC Boobalan Pachaiyap ...

COVID-19 Treatment Development - The company is pursuing the study of opaganib and RHB-107 as potential treatments for COVID-19, but there is a high level of uncertainty regarding their safety and efficacy [23]. - The biotechnology sector is highly competitive, with numerous companies developing COVID-19 treatments and vaccines, which may limit the commercial opportunity for the company's therapeutic candidates [27]. - The company has entered into collaborations with leading manufacturers to expand manufacturing capacity for opaganib in preparation for potential emergency use applications [34]. - The ongoing COVID-19 pandemic has adversely affected the company's business, revenues, and results of operations, particularly impacting sales of commercial products due to decreased in-clinic patient visits [39]. - The company has experienced slow enrollment in clinical trials, such as the Phase 3 study with RHB-204, which has delayed progress [39]. - The company may face difficulties in scaling up manufacturing processes for opaganib and RHB-107, which could impact the supply for clinical trials and commercial use [23]. - The company may need to devote significant resources to expand sales and marketing activities if COVID-19 therapeutic candidates are approved for marketing [30]. - The continuation of the COVID-19 pandemic could materially disrupt the company's business and operations, affecting sales and financial obligations [43]. Financial Performance and Projections - The company experienced net losses of approximately $97.7 million in 2021, $76.2 million in 2020, and $42.3 million in 2019, with an accumulated deficit of approximately $367.9 million as of December 31, 2021 [48]. - As of December 31, 2021, the company had cash, cash equivalents, short-term investments, and restricted cash of approximately $54.2 million, up from $46.0 million as of December 31, 2020 [51]. - The company plans to fund future operations through commercialization of products like Movantik®, Talicia®, and Aemcolo®, as well as out-licensing therapeutic candidates and raising additional capital [52]. - The company has only started to record meaningful net revenues since the end of 2020 and is not yet profitable [54]. - The company has a history of operating losses and may continue to incur significant losses in the coming years [45]. - The company may need to raise additional capital to achieve strategic objectives and execute business plans, as current working capital is insufficient [50]. Regulatory and Compliance Risks - The company faces risks related to regulatory compliance and potential enforcement actions that could adversely affect its reputation and financial condition [61]. - Regulatory approvals for commercial products are subject to ongoing review, and failure to comply with regulations could lead to loss of approvals and adverse effects on the company's financial condition [160]. - The FDA approval for Aemcolo® is contingent upon completing additional studies, which may affect its market acceptance and profitability [76][80]. - The FDA may require additional clinical trials or studies for therapeutic candidates, which can lead to increased costs and delays in obtaining marketing clearance [171]. - The company is subject to extensive governmental laws and regulations regarding the development and commercialization of its products [142]. Market Competition and Challenges - The company faces intense competition for qualified personnel, which may impact its ability to attract and retain key employees necessary for its operations [135]. - The company competes with other entities for in-license or acquisition opportunities, which may hinder its growth if it cannot secure favorable terms [127]. - Movantik® competes with other approved PAMORA drugs and several branded prescription therapies for treating opioid-induced constipation (OIC) [206]. - Talicia® competes with both branded and generic therapies for H. pylori treatment, including a new Vonoprazan-based combination treatment under development by Phathom Pharmaceuticals [207]. - The company faces competition from pharmaceutical and biotechnology firms that have greater R&D capabilities and resources, which intensifies market competition [209]. Manufacturing and Supply Chain Issues - Supply chain disruptions due to the COVID-19 pandemic have resulted in shipping delays and increased costs, which could adversely affect the company's financial condition and results of operations [44]. - The reliance on third-party manufacturers for commercial products poses risks, including potential supply interruptions and quality assurance issues [114]. - The company is in the process of transitioning the manufacture of Movantik® from AstraZeneca to other third parties, which must be completed successfully to meet supply requirements [114]. - The company anticipates continued reliance on third-party manufacturers for its therapeutic candidates, which may affect the timely production of commercial quantities [121]. - The company may incur higher than expected costs in the commercialization of products, potentially leading to a reduction or termination of commercial activities [104]. Product Development and Approval - Most therapeutic candidates are in late-stage clinical development and will require successful additional clinical trials for regulatory approvals [48]. - The company has six therapeutic candidates in late-clinical stage development, aiming for FDA or foreign regulatory approvals [142]. - The company must complete two pediatric postmarketing studies for Aemcolo® by June 2025 and January 2025, respectively, to retain FDA approval, with potential penalties for non-compliance [78][81]. - The company has received orphan drug designation for RHB-104 for Crohn's disease, which provides financial incentives and potential exclusivity for seven years upon FDA approval [181]. - The company is advancing the development of a companion diagnostic for MAP detection in Crohn's disease patients, but the timeline for availability remains uncertain [174]. Human Resources and Operational Challenges - The company has experienced high turnover rates in its U.S. subsidiary due to a tightening labor market, impacting its ability to attract and retain key personnel [69]. - High turnover rates have been observed in the company's U.S. subsidiary, which could lead to increased operational costs and affect overall business efficiency [135]. - The company faces challenges in large-scale manufacturing, including yield and quality issues, which could affect product availability [216]. - The company has limited experience in managing clinical trials, which may lead to unforeseen delays and complications in obtaining regulatory approvals [170]. Strategic Partnerships and Collaborations - The company relies on third parties for the commercialization of its products, which exposes it to risks such as default on obligations and lack of control over marketing strategies [82][84]. - The company may need to alter its development and commercialization plans if it cannot establish collaborations or raise substantial additional capital [123]. - The company has exclusive license agreements for Talicia® in the UAE and opaganib in South Korea, but regulatory approval in these regions is uncertain [138].