Research and Development - The company incurred $454,443 in R&D expenditures for the quarter ended May 31, 2021, compared to $24,577 in May 2020, indicating a significant increase in investment in research and development [96]. - The company plans to use approximately $3,700,000 of the net proceeds from its public offering for research and development studies and associated patent and legal costs [87]. - The company is exploring methods to integrate nanoemulsification chemistry techniques with its technology to enhance intestinal bioabsorption rates [97]. - The company has conducted in vitro and in vivo absorption tests of its DehydraTECH technology with positive results for molecules such as CBD and ibuprofen [98]. - R&D expenditures increased by $504,525 for the period ended May 31, 2021, as the company undertook several studies within its applied research and development program [117]. - The company anticipates ongoing operating losses and negative cash flows for the foreseeable future, driven by increased R&D expenses related to clinical trials [108]. Patents and Technology - The company currently has over 50 patent applications pending worldwide and has been granted 20 patents to date, with the latest patent issued in Japan on July 13, 2021 [78][79]. - The company is focusing on developing strategic partnerships for its patented DehydraTECH technology, aiming for upfront and staged licensing fees and royalty payments over time [77]. - The company reported positive results from its CBD DehydraTECH 2.0 enhanced formulations during the second quarter ended May 31, 2021, with ongoing testing to further define absorption rates and delivery formats [99]. Financial Performance - The company reported a net loss of $2,861,483 for the nine months ended May 31, 2021, compared to a net loss of $3,286,033 for the same period in 2020, reflecting a decrease in loss of $424,550 [112]. - Revenue increased significantly to $691,717 for the nine months ended May 31, 2021, up from $250,804 in the same period in 2020, marking an increase of $440,913 [111]. - Product revenues were $360,558 and licensing usage fees were $326,474, indicating substantial growth in intermediate product sales during the period [113]. - The company's working capital increased to $9,464,343 as of May 31, 2021, compared to $1,700,044 as of August 31, 2020, due to an underwritten public offering [119]. - Cash flows used in operating activities increased by $984,240 for the period compared to the same period in 2020, primarily due to higher professional fees and costs related to the NASDAQ listing [121]. - The company had cash and cash equivalents of approximately $8.1 million as of May 31, 2021, which is expected to fund operations into the third quarter of fiscal 2022 [110]. Market Activity - The company's common stock began trading on the Nasdaq Capital Market under the symbols LEXX and LEXXW effective January 12, 2021 [88]. - The company closed an underwritten public offering on January 12, 2021, for net proceeds of $9,471,495, issuing 1,828,571 units [126]. Operational Changes - The company has made modifications to its operations due to COVID-19, requiring team members to work remotely, which may impact business activities [92][93]. - Legal and professional fees rose by $240,162 during the period, primarily due to increased patent and trademark filings and advisory services [119].
Lexaria Bioscience(LEXX) - 2021 Q3 - Quarterly Report