Article MEDMIRA CFO HINTS
FUNDING COMING
MedMira Inc. CFO Markus Meile is scoffing at speculation the cash-strapped biotech company could be acquired outright by its major Swiss shareholder.~
"There is no merit to such rumours," Meile told allNovaScotia Wednesday, a day after MedMira offered an update saying that much-needed funding from "any related parties" has yet to come.
Meile declined to say whether MedMira remains in discussions with Switzerland-based MedMira Holding AG, the new name for majority shareholder OnSite Lab Holding AG.
With circa 474 million shares in MedMira for a 72% stake, the former OnSite has funnelled millions into the Halifax-based company over the years to fund the research and development of instant portable diagnostic testing kits for diseases like syphilis and HIV.
Meile hinted that more funding is in the works.
"When a contract has been executed, all stakeholders will be informed at the same time," he said.
"Until then, all shareholders are being treated the same way without any exceptions."
MedMira's been racking up losses since it was started by Hermes Chan and his scientist wife Carlina Hui in the early 1990s in a basement chemistry lab at Acadia University.
The company is now in default on nearly $8 million worth of loans, including more than $3 million to Nova Scotia taxpayers and more than $485,000 to the Atlantic Canada Opportunities Agency (ACOA).
It is in a negative working capital position of circa $12 million and doesn't have money to fund its operations for 2019.
Executives and employees have been ponying up with loans during the cash crunch.
Beyond hoping to secure working capital funds and get out of default, Chan and Meile are seeking money to fund research and development at its Bayers Lake labs to cover existing commitments.
While it awaits bigger funding, MedMira received $190,000 from "a non-related party" subsequent to the end of its fiscal first quarter ended Oct. 31 to help stay afloat.
The loan bears an interest rate of 5% a year and is payable on demand.
The loan was disclosed at the end of December along with MedMira's unaudited results for the quarter.
While its first-quarter financials are in, MedMira has yet to file audited results for its last fiscal year ended July 31.
MedMira is blaming the delay on the abrupt exit of its auditor, Deloitte, in the summer.
The company said this week it expects to have the financials filed by Feb. 28, months after they are typically available to investors and the public.
The failure to file audited results led Nova Scotia securities regulators to ban Chan, Meile and directors at MedMira from buying or selling shares in the company (see 2018-11-30).
The management cease trade order, issued in late November, will be lifted once MedMira reports its full-year 2018 audited financial results along with management's discussion and analysis.
MedMira's shares were hit with a cease-trade order months earlier after the company failed to notify investors that it was dropped by Deloitte (see 2018-09-06).
It's since retained Charlottetown's Arsenault Best Cameron Ellis to audit the books.
For its first quarter, MedMira had sales of $155,065 - roughly 80% of its which came from three customers.
That's up from $143,042 a year earlier when four customers accounted for 94% of sales.
The company posted a first-quarter loss of $550,039, with cost-cutting helping to reduce the $636,174 loss for the same period a year earlier.
MedMira's stock price was unchanged Wednesday at a 52-week low of a penny a share (52-week high: three cents).