Oramed(ORMP) - 2022 Q1 - Quarterly Report

Financial Performance - Revenues remained stable at $666 thousand for the three months ended March 31, 2022, unchanged from the same period in 2021[27] - The net loss for the period was $10,708 thousand, compared to a net loss of $6,063 thousand for the same period in 2021, indicating an increase in losses of 76.5%[27] - Basic and diluted loss per share increased to $0.27 for the three months ended March 31, 2022, compared to $0.20 in the prior year[27] - For the three months ended March 31, 2022, the company reported a net loss of $10.708 million, compared to a net loss of $6.063 million for the same period in 2021, representing a 76.5% increase in losses year-over-year[34] - Revenues for the three-month periods ended March 31, 2022, and March 31, 2021, were both $666,000, with no cost of revenues reported[112][114] Expenses - Research and development expenses were $5,836 thousand, a decrease of 5.4% from $6,168 thousand in the prior year[27] - General and administrative expenses increased significantly to $5,492 thousand, compared to $1,102 thousand in the same period last year, reflecting a rise of 398%[27] - The company incurred stock-based compensation expenses of $4.029 million in the three months ended March 31, 2022, compared to $647 thousand in the same period in 2021, reflecting a substantial increase[34] - Research and development expenses decreased by 5% to $5,836,000 for the three-month period ended March 31, 2022, compared to $6,168,000 for the same period in 2021[121] - General and administrative expenses increased by 398% to $5,492,000 for the three-month period ended March 31, 2022, compared to $1,102,000 in the prior year[127] Assets and Liabilities - Total assets decreased to $172,224 thousand as of March 31, 2022, down from $177,820 thousand as of December 31, 2021, representing a decline of approximately 3.3%[24] - Total stockholders' equity decreased to $162,349 thousand as of March 31, 2022, down from $166,453 thousand as of December 31, 2021, a decline of approximately 2.5%[24] - Total current liabilities decreased to $6,324 thousand as of March 31, 2022, down from $7,368 thousand as of December 31, 2021, a reduction of 14.2%[24] - As of March 31, 2022, total current assets were $143,562,000, and total current liabilities were $6,324,000, resulting in a working capital surplus of $137,238,000[132] - The accumulated loss as of March 31, 2022, was $136,945,000, an increase from $126,520,000 as of December 31, 2021[132] Cash Flow - Cash and cash equivalents increased slightly to $27,967 thousand from $27,456 thousand, reflecting a growth of 1.9%[24] - Total net cash used in operating activities was $9.125 million for the three months ended March 31, 2022, compared to $3.682 million for the same period in 2021, indicating a significant increase in cash outflow[34] - Cash and cash equivalents at the end of the period were $27.967 million, a decrease from $57.741 million at the end of the same period in 2021[34] - The company reported total net cash provided by investing activities of $7.359 million for the three months ended March 31, 2022, down from $10.753 million in the same period in 2021[34] - Operating activities used cash of $9,125,000 in the three-month period ended March 31, 2022, compared to $3,682,000 used in the same period in 2021[134] Financing Activities - The company issued 405,224 shares of common stock during the three months ended March 31, 2022, resulting in an increase in common stock value to $463 thousand[31] - The Company raised approximately $46,375,000 from a registered direct offering of 2,000,000 shares at an offering price of $25.00 per share on November 5, 2021[82] - The Company issued 841,638 shares under the Cantor Equity Distribution Agreement for aggregate net proceeds of $15,275,000 as of May 12, 2022[82] - The company entered into a controlled equity offering agreement allowing for the issuance of up to $100,000,000 in common stock, with 841,638 shares issued for net proceeds of $15,275,000 as of May 12, 2022[137] - A securities purchase agreement was executed to sell 2,000,000 shares at $25.00 per share, resulting in net proceeds of approximately $46,375,000[138] Clinical Trials and Product Development - The proprietary oral insulin capsule, ORMD-0801, is designed to deliver insulin effectively and is currently undergoing clinical trials[95] - The FDA has indicated that the regulatory pathway for ORMD-0801 will be a BLA, potentially granting 12 years of marketing exclusivity upon approval[98] - The Phase 2b trial for ORMD-0801 showed positive topline data, demonstrating an excellent safety profile with no serious drug-related adverse events[99] - The company is conducting two concurrent Phase 3 trials for ORMD-0801 involving approximately 1,125 patients with type 2 diabetes (T2D) to assess safety and efficacy over 6 to 12 months[100] - The company expects topline results from the trials in January 2023 and plans to file a Biologics License Application (BLA) with the FDA in 2024, which would provide at least 12 years of marketing exclusivity[102] Revenue Recognition and Agreements - The company recognized revenue of $666 thousand in the quarter ended March 31, 2022, from the HTIT License Agreement, with a total of $17.005 million recognized to date under this agreement[51] - The company has deferred $5.377 million in revenue related to the HTIT License Agreement, which is presented as deferred revenues on the balance sheet[51] - The HTIT License Agreement includes a royalty rate of 10% on net sales of commercialized products, which may be reduced to 8% if certain conditions are not met, and potentially to 5% after patent expiration in 2033[56] - The Company has a deferred revenue of $2,000 related to disputed payments from HTIT, with a total disputed amount of $6,000[59] - The Company allocated $38,883 to the HTIT License Agreement as part of a total consideration of $49,500 from the SPA and License Agreement[61]