SAN FRANCISCO and TEL AVIV, Israel, May 01, 2019 (GLOBE NEWSWIRE) -- Kalytera Therapeutics, Inc. (TSX VENTURE: KLY and OTCQB: KALTF) (the "Company" or "Kalytera") today reported financial results for the year ended December 31 2018. (All dollars U.S. unless otherwise noted.)
Investors should note that the Company’s TSXV ticker symbol was recently changed from "KALY" to "KLY".
For 2018, the Company recorded net income of approximately $6.9 million ($0.04 per Common Share), compared with a net loss of approximately $31.9 million ($0.26 per Common Share) in 2017.
The change from a net loss in 2017 to net income in 2018 is primarily due to a gain of approximately $14.2 million recorded in 2018 in connection with updated valuations of the Company’s outstanding derivative securities, as well as income of approximately $12.9 million related to the an update of the fair-value of contingent liabilities that relate to the Company’s acquisition of Talent Biotechs, Ltd. (“Talent”) in 2017. Additional factors relating to the change from a net loss in 2017 to net income in 2018 are an expense of approximately $7.9 million recorded in 2017 in connection with the valuation of warrants and debentures, and approximately $9.0 million of finance expenses, both of which relate to the issuance costs of warrants and debentures that were issued in December 2017, as well as other expenses recorded in 2017 of approximately $9.6 million to update the fair-value of contingent liabilities that relate to the Company’s acquisition of Talent.
Operating Expenses
For 2018, research and development expenditures increased to approximately $7.7 million, from approximately $1.7 million in 2017.
The increase in research and development expenses by approximately $6.0 million is primarily due to an increase in development activities related to the Company’s lead product development program evaluating cannabidiol ("CBD") for the prevention and treatment of graft versus host disease ("GVHD"); research and development activities related to the Company’s product development program evaluating its proprietary cannabinoid compound for the treatment of pain; and other research and development projects.
General and administrative expenses remained consistent between 2017 and 2018, with 2018 G&A expenses of approximately $3.4 million, compared with G&A expenses of approximately $3.2 million in 2017.
At December 31, 2018, the Company’s cash and cash equivalents decreased to $227,000 compared with approximately $3.7 million at December 31, 2017.
During 2018, the Company funded it operating costs through a combination of cash and equity payments to its creditors. The Company’s largest creditor during calendar 2018 was the Salzman Group of Israel. Under agreements with the Salzman Group, the Company had the ability to elect to pay amounts due to the Salzman Group in either cash or through the issuance of common shares. The ability to pay amounts due through the issuance of common shares under these agreements terminated effective March 1, 2019.
On April 26, 2019, the Company announced the closing of a public offering for aggregate gross proceeds of approximately $6.8 million. The Company believes that it has sufficient cash to fund its operating costs through completion of its ongoing Phase 2 program evaluating CBD for the prevention of GVHD, which work is expected to be complete during Q3 2019.
About Kalytera Therapeutics
Kalytera Therapeutics, Inc. is pioneering the development of CBD therapeutics. Through its proven leadership, drug development expertise, and intellectual property portfolio, Kalytera seeks to establish a leading position in the development of CBD medicines for a range of important unmet medical needs, with an initial focus on GVHD and treatment of acute and chronic pain.
Cautionary Statements
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release may contain certain forward-looking information and statements ("forward-looking information") within the meaning of applicable Canadian securities legislation, that are not based on historical fact, including without limitation in respect of its product candidate pipeline, planned clinical trials, regulatory approval prospects, intellectual property objectives and other statements containing the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "continue", "estimate", "forecasts" and other similar expressions. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risk that future clinical studies may not proceed as expected or may produce unfavourable results. Kalytera undertakes no obligation to comment on analyses, expectations or statements made by third-parties, its securities, or financial or operating results (as applicable). Although Kalytera believes that the expectations reflected in forward-looking information in this press release are reasonable, such forward-looking information has been based on expectations, factors and assumptions concerning future events which may prove to be inaccurate and are subject to numerous risks and uncertainties, certain of which are beyond Kalytera's control. The forward-looking information contained in this press release is expressly qualified by this cautionary statement and is made as of the date hereof. Kalytera disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
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