Aytu BioPharma(US:AYTU)2023-02-20 16:00Revenue and Profit - For the three months ended December 31, 2022, net product revenue increased by $3.2 million, or 14%, compared to the same period in 2021, driven primarily by growth in the Pediatric Portfolio [175]. - Gross profit for the three months ended December 31, 2022, was $17.3 million, an increase of $5.0 million, or 41%, compared to the same period in 2021, with gross margin percentage rising to 66% [179]. Expenses and Losses - Research and development expenses decreased by $2.8 million, or 62%, for the three months ended December 31, 2022, due to the suspension of development programs AR101 and Healight [181]. - Operating expenses totaled $24.1 million for the three months ended December 31, 2022, a slight increase of $0.5 million compared to the same period in 2021 [176]. - The company reported a net loss of $6.7 million for the three months ended December 31, 2022, compared to a net loss of $11.5 million in the same period in 2021, reflecting a reduction of $4.9 million [176]. - The company incurred an impairment charge of $2.6 million related to the cessation of active development of the NT0502 product candidate [184]. Future Projections and Savings - The company expects to save over $20 million in projected future study costs over the next three fiscal years due to the suspension of clinical development programs [165]. - The company entered into an agreement to extend the interest-only period of its senior secured loan facility, which is expected to conserve approximately $3.0 million in cash related to principal payments in 2023 [170]. Financial Position and Cash Flow - As of December 31, 2022, the accumulated deficit was $294.5 million, up from $287.1 million as of June 30, 2022 [164]. - Net cash used in operating activities totaled $11.6 million for the six months ended December 31, 2022, a decrease of $1.0 million compared to $12.6 million in the same period of 2021 [193]. - Net cash provided by financing activities was $11.7 million during the six months ended December 31, 2022, primarily from $9.1 million in proceeds from the August 2022 equity raise [196]. - As of December 31, 2022, approximately $82.4 million remains available under the 2021 Shelf registration statement [186]. Obligations and Liabilities - The company has obligations for fixed and contingent milestone payments totaling up to $16.0 million related to the acquisition of Innovus Pharmaceuticals, Inc. [202]. - The company may be required to pay up to $67.5 million in regulatory and commercial-based earn-out payments to Rumpus, contingent on milestone achievements [203]. - The company had $0.4 million accrued for plaintiff's attorney fees related to ongoing class-action securities litigations as of December 31, 2022 [211]. Strategic Initiatives - The company plans to evaluate strategic options for the Healight asset, including potential partnerships and modifications to existing licensing agreements [166]. - The company experienced significant inflationary pressure and supply chain disruptions during fiscal 2022 and 2023, which are expected to continue impacting operations [169]. Amortization and Gains - Amortization expense of intangible assets decreased by $0.3 million (20%) and $0.6 million (21%) for the three and six months ended December 31, 2022, respectively, compared to the same periods in 2021 [185]. - The company recognized an unrealized gain of $1.4 million and $3.6 million from derivative warrant liabilities for the three and six months ended December 31, 2022, respectively [185]. Loan Agreements - The Eclipse Loan Agreement provides up to $12.5 million in Revolving Loans, with a maturity date of January 26, 2025 [190].