TORONTO, ON / ACCESSWIRE / April 17, 2019 /Theralase® Technologies Inc. (“Theralase®” or the “Company“) (TSXV: TLT) (OTCQB: TLTFF), a clinical stage pharmaceutical company dedicated to the research and development of light activated Photo Dynamic Compounds (“PDC”) and their associated drug formulations intended to safely and effectively destroy various cancers released the audited financial statements for the year ended December 31, 2018.
Total revenue for the year ended December 31, 2018 decreased to 1,734,072 from 2,342,508 in 2017, a 26% decrease. In Canada, revenue decreased 38% to $1,205,312 from $1,942,010. In the US, revenue increased 16% to $304,785 from $261,833 and international revenue increased 62% to $223,975 from $138,665. The decrease in total revenue in 2018 is primarily due to the restructuring of the sales and marketing departments resulting in the termination of certain sales and marketing personnel and decreased spending in advertising.
Cost of sales for the year ended December 31, 2018 was $786,433 resulting in a gross margin of $947,639 (55% of revenue), compared to a cost of sales of $945,010 in 2017, resulting in a gross margin of $1,397,498 (60% of revenue). Cost of sales is represented by the following costs: raw materials, subcontracting, direct and indirect labour and the applicable share of manufacturing overhead.
The gross margin as a percentage of sales decrease, year over year, is attributed to discounted sales pricing for the TLC-1000 and TLC-2000 product lines
For the year ended December 31, 2018, selling and marketing expenses decreased to $871,405 or 50% of sales, from $1,917,106 or 82% of sales in 2017, representing a 55% decrease. The decrease in selling and marketing expenses is primarily due to the restructuring of the Canadian and US sales and marketing departments, resulting in the termination of certain sales and marketing personnel and decreased spending in advertising.
Administrative expenses for the year ended December 31, 2018 decreased to $1,739,665 from $2,912,170 in 2017, representing a 40% decrease.
Decreases in administrative expenses are attributed to the following:
- Administrative salaries decreased by 26% due to the termination and/or resignation of certain administrative staff.
- Stock based compensation decreased 64% due to certain current employees forfeiting all non-vested and non-exercised stock options totaling 4,300,000 and certain terminated or resigned employees forfeiting all non-vested and non-exercised options totaling 240,000.
- General and administrative expenses decreased 55% due to decreased investment in investor relations and recruiting expenses
Net research and development expenses for the year ended December 31, 2018 decreased to $1,703,803 from $2,652,969 in 2017, representing a 36% decrease.
Research and development expenses for the year ended December 31, 2018 decreased primarily due to the following:
- Decreased expenses for conducting the Phase Ib Non-Muscle Invasive Bladder Cancer (“NMIBC“) clinical study
- Placing the software, firmware and hardware modifications of the TLC-2000 laser system on temporary hold
Research and development expenses represented 40% of the Company’s operating expenses for the year ended December 31, 2018 and represent an investment into the research and development of the Company’s Anti-Cancer Technology (“ACT“).
The net loss for the year ended December 31, 2018 was $3,356,877 which included $409,817 of net non-cash expenses (i.e.: amortization, stock-based compensation expense, foreign exchange gain/loss and lease inducements). This compared to a net loss for the same period in 2017 of $6,093,596, which included $762,101 of net non-cash expenses. The ACT division represented $2,035,491 of this loss (61%) for the year ended December 31, 2018.
The decrease in net loss is primarily attributed to the following:
- Decreased investment in research and development in the Phase Ib NMIBC clinical study.
- Decreased investment in external engineering resources to redesign the software, firmware and hardware of the TLC-2000 therapeutic laser.
- Decreased sales, marketing and administrative costs.
Theralase® is focused on the commencement of Phase II NMIBC clinical study (“Study II“) in early 2Q2019 after successfully completing the Phase I NMIBC study demonstrating the primary endpoint of safety and tolerability, secondary endpoint of pharmacokinetics and the exploratory endpoint of efficacy in NMIBC patients considered Bacillus Calmette-Guerin – unresponsive.
As previously reported:
On November 15, 2018, the Company announced “Theralase® Granted Canadian Anti-Cancer Patent”. The Canadian patent entitled, “Metal-Glycoprotein Complexes and Their Use as Chemotherapeutic Compounds” validates the proprietary position of the Company’s ACT for the Canadian healthcare market. The Company’s patented technology is the lead asset in the NMIBC clinical study and elucidation into preclinical research for two additional cancer indications; specifically: GlioBlastoma Multiforme, a deadly form of brain cancer and Non-Small Cell Lung Cancer.
On December 10, 2018, the Company announced that “Health Canada Grants ITA Approval to Commence Phase II Clinical Study”. The Investigational Testing Authorization approval will utilize the Company’s patent pending TLC-3000 Photo Dynamic Therapy (“PDT“) Laser System, in conjunction with its Clinical Trial Application approved lead PDC, TLD-1433, to commence enrolling and treating patients in a Phase II NMIBC clinical study subject to the respective Research Ethics Board approval from each Study II site.
On January 9, 2019, the Company closed a non-brokered private placement of Units, issuing an aggregate of 4,095,157 units at a price of $0.35 per Unit for aggregate gross proceeds of approximately $1,433,305. Each Unit consist of one common share of the Company and one non-transferable common share purchase warrant (each, a “Warrant“). Each Warrant entitles the holder to acquire an additional Common Share at a price of $0.50 for a period of 24 months following the date of issuance. An aggregate of 542,857 Units, representing gross proceeds of $190,000, were issued to certain insiders of the Company.
On January 31, 2019, the Company announced “Theralase® Patient Five Cancer-Free Twelve Months After Single Anti-Cancer Treatment”. Patient five demonstrated no tumour recurrence or presence of disease at the 360 day clinical and cystoscopy assessment.
On February 25, 2019, the Company appointed Shawn Shirazi, Ph.D., to the role of Chief Executive Officer (“CEO“) of Theralase’s Drug Division and Kipton Lade, B.Sc., M.Sc., MBA., to the role of CEO of Theralase’s Device Division.
On April 2, 2019, the Company announced that “Patient Six Cancer-free Twelve Months After Single Anti-Cancer Treatment”. Patient six demonstrated no tumour recurrence or presence of disease at the 360 day clinical and cystoscopy assessment.
About Theralase® Technologies Inc.
Theralase® is a clinical stage pharmaceutical company dedicated to the research and development of light activated Photo Dynamic Compounds and their associated drug formulations intended to safely and effectively destroy various cancers.
This news release contains “forward-looking statements” which reflect the current expectations of management of the Company’s future growth, results of operations, performance and business prospects and opportunities. Such statements include, but are not limited to, statements regarding the Company’s proposed development plans with respect to Photo Dynamic Compounds and their drug formulations. Wherever possible, words such as “may“, “would“, “could“, “should“, “will“, “anticipate“, “believe“, “plan“, “expect“, “intend“, “estimate“, “potential for” and similar expressions have been used to identify these forward-looking statements. These statements reflect management’s current beliefs with respect to future events and are based on information currently available to management. Forward-looking statements involve significant risks, uncertainties and assumptions including with respect to the ability of the Company to: adequately fund, secure the requisite regulatory approvals to commence and successfully complete a Phase II NMIBC clinical study in a timely fashion and implement its development plans. Many factors could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements; including, without limitation, those listed in the filings made by the Company with the Canadian securities regulatory authorities (which may be viewed at www.sedar.com). Should one or more of these risks or uncertainties materialize or should assumptions underlying the forward looking statements prove incorrect, actual results, performance or achievements may vary materially from those expressed or implied by the forward-looking statements contained in this news release. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in the press release are based upon what management currently believes to be reasonable assumptions, the Company cannot assure prospective investors that actual results, performance or achievements will be consistent with these forward-looking statements. The Company disclaims any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise except as required by law. All forward-looking statements are expressly qualified in their entirety by this cautionary statement.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchanges) accepts responsibility for the adequacy or accuracy of this release.
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SOURCE: Theralase Technologies Inc.
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