Q3 2021 Statera Biopharma Inc Earnings Call
Okay.
Good morning, ladies and gentlemen, and thank you for joining us for <unk> Biopharma, Inc. Third quarter 2021 financial results Conference call.
Following the prepared remarks from the company, we will open the call for questions.
I would now like to turn the call over to stairs executive Vice President of Investor Relations Nichol Ochsner, Ma'am you may now begin.
Good afternoon, everyone and thank you for joining Mr. Terrill, Biopharma 2021 third quarter financial results and corporate update call earlier. This afternoon. The tariff Biopharma issued a press release detailing the financial results for the three and nine months ended September 32000.
21, which we encourage listeners to read the press release can be found in the investors section Christy Terra Biopharma dotcom.
Tara also filed a 10-Q this afternoon, which is available in S E T Dot Gov.
Before beginning todays call I would like to make the following statement today, we will be making certain forward looking statements about operating metrics future expectations plans events and circumstances, including statements about our strategy future operations and the development and effectiveness of our.
<unk> drug candidate and our expectations regarding our capital allocation and cash resources. These statements are based on current expectations.
You should not place undue reliance on these statements actual results may differ materially due to our risks and uncertainties, including those detailed in our most recent 10-K filing.
Tara disclaims any obligation to update information contained in these forward looking statements, whether as a result of new information future events or otherwise.
On today's call is Michael Kaye, Handley, President and CEO of the Terra Biopharma, Inc, who will provide an update on the terrorist recent corporate and clinical achievements.
The vision for the future.
Mr. Peter Arrants fan Chief financial officer of the pair of Biopharma.
Who will discuss the company's financial results and Doctor Tanya Mark Mcdonough, Chief operating officers to Tara, who will discuss the company's clinical programs.
I'd now like to turn the call over to our CEO Michael Hanley, Michael. Please go ahead.
Yeah.
Great. Thanks, Nicole and thanks, everyone for joining our conference. This afternoon, including all of you joining for the first time.
Today I'm speaking to you as CEO of <unk> Biopharma.
Just three months ago, we were known insider com.
Through the reverse merger with Cleveland Biolab from the acquisition of the drug development Company and Quest Lifesciences, we emerged as a publicly traded company at the end of July.
Focused on developing the next generation of immune modulating agents addressing autoimmune infectious disease cancer and blood disorders.
The new company deserves a new name and reflective of the company's core focus on is that.
On September one 2021, we formally rebranded sterile biopharma with a new ticker symbol S. T. A.
Our names Taro has taken from allowed word balance this with our corporate tagline restoring immune health were chosen to reflect the strategic focus of the company and of our pipeline.
So terra is a clinical stage biopharmaceutical company at the forefront of developing the next generation of therapeutic agents focused on immune modulation and the restoration of immune homeostasis and simple firms. They are driving the science, which demonstrates that an overactive underactive immune system can drive disease progression where folks.
On developing drugs to restore and rebalance the immune system.
Address autoimmune blood disorders, infectious disease and cancer.
With the recent merger we have created one of the largest toll receptor platforms and since then we have not slowed down.
Please advance to slide four.
Our pipeline focus is initially targeting autoimmune disease with the staff to have one program in pediatric Crohn's disease.
To expand into hematology, but the stat, 600 progressed or intolerant and oncology with a step 401 program in pancreatic cancer.
Beyond our clinical programs. We're also working to develop new second generation assets to further support our growth strategy and deepen our pipeline.
We are already screening. These first round of the second generation immuno modulator compounds honestly, the tools and capabilities of our <unk> plus life science subsidiary to sweat those compounds, most likely to succeed in preclinical and clinical trials.
Tara is also establishing new research alliances in August we finalized a five year drug discovery agreement with the Jolla Institute of Immunology.
Directed to research that will support the development of potential new immune modulating agents targeting toll like receptors for the treatment of cancer infectious autoimmune and some chronic inflammatory diseases.
The research will harness the terrorists proprietary drug discovery and development platform technology.
We are pleased to add this prestigious research centre to the growing list of those involved in our clinical programs.
<unk> on this list is long haul Linda University Health and Roswell Park comprehensive cancer Center in Buffalo New York.
Work is also underway to integrate the former Inquests life Sciences in Cleveland Biolab organizations as well as the subsidiaries and joint ventures with the tariff.
We're exploring opportunities to monetize noncore assets.
In the meantime, we expect to achieve several clinical and corporate milestones over the next 12 to 18 months.
Our ultimate goal is to change the way people think about immunotherapy.
Terra has promising technology focus on delivering immune therapies that target toll like receptors type of protein central to the immune response that plays a key role in fighting disease in a storm.
Stages.
We believe the Taro now has one of the largest platforms of toll like receptors in the pharmaceutical industry with our toll like receptor four toll like receptor nine antagonists and our toll like receptor agonists in parliament CPE pricing too.
We also plan to further strengthen the balance sheet to enable the growth and expansion of our pipeline.
Our CFO, Peter will review, our quarterly numbers and financing arrangements, including the credit facility and equity line of credit agreement. The company ended the third quarter with approximately $14 4 million in cash on hand, and I expect the strength of our capital position by the end of the year to further growth.
Other grower initiatives fund business development plans and advanced development of our internal pipeline.
With that as an intro I'd like now to hand, the call over to CFO of Purion staff, who will discuss the third quarter financial results Peter.
Thanks, very much Mike.
As Mike just pointed out.
It's kind of we're speaking to the investors and analysts from the terror.
The merged company.
So before I go into more detail about the number could be filed in the 10-K 10-Q today.
Let me briefly describe how the rule for accounting for the merger.
Clients present those numbers.
You'll read in the 10-K for example.
Counting the by the end of the merger with old tried to come.
You will also read the surviving legal entity with old Seabee ally Ethan.
Even though it as Mike has mentioned to choose between Baptist tied to come immediately after the merger.
And then later on.
To me too.
Sure.
So what are those accounting term me when we speak about accounting legal survivor.
And what do they need to look for the results that we presented in the 10-Q.
I'd like to go through these numbers tend to keep in mind two things.
So when you look at the income statement till the P&L.
The statement of the accounting for that either you are looking in the P&L.
Come.
And what Youre seeing there in the P&L is the result of all of <unk> 'twenty and 2021 through to the end of June, but we'll try to come only.
So there's no revenue or expenses included in the period or <unk> or <unk>.
Right.
Keep in mind that the merger with increased only closed at the end of June this year.
As Michael mentioned the merger with <unk> when we close at the end of July.
So for the three months ended September 32021.
P&L combines the result.
Come with the results with other companies.
Only from the closing date of each merger through the end of September.
So for those of you who like to perform comparison in relation to prior periods.
Please keep in mind that those comparisons were really only become meaningful when we get to and we report the third quarter 2022.
You'll have seen the 10 Qs the term accounting survive it.
That means from a balance sheet perspective.
Assets and liabilities presented up to the med to date for those who are outside to come only.
Is that the assets and liabilities only not the equity accounts.
The liabilities that we would see be aligned and quick but only added to the balance sheet from their respective merger date.
And then hope things to keep in mind is that the current he'd be a lie.
The binding legal entity.
Brian the only thing the coast is registered with the state of Delaware.
The merger.
So that means for reporting that the statement of equity shown in the balance sheet forthright and issued common stock authorized and issued preferred.
Without the.
P P align and old to come pretty much only for all periods in the report.
So that's why for example, if you weren't to come into this so you don't see any references in the equity section to the preferred shares issued by <unk> to come in 2020 in 2021.
The old project come stands were exchanged in the merger with common shares can OTB align and you announced with them or put it in the equity section of the Terra common Stan.
If there's any questions about the nature of the accounting.
Be happy to take them at the end of the formal presentation.
Turning now to the next slide slide number six in the presentation. Let me just talk very briefly about the results reported.
For the nine months in the three months in the 10-Q.
The company reported revenues of $236000 in the critical end of September 32021.
All of those revenues were derived from our search services provided by <unk> to its customers.
We're comfortable revenues was approximately $116000.
Which means that they made a gross profit of 120000 to approximately 51%.
And then as I just mentioned a few minutes ago.
Recorded no revenues in the same period of 2020, because the mindshare with increased only became effective at the end of June 2021.
I just wanted to point out just in the side also.
Recognized as revenue.
When it's delivered to its final research proposed to its customers.
Even if it collected cash in advance of the delivery of the report.
The cash received the full delivery as shown on the balance sheet as deferred revenue.
And if you look at September 30 of 2021 balance sheet, you'll see that we reported deferred revenue of approximately $506000 in this manner.
And that indicates to you that since the beginning of July.
In total any questions collected approximately three quarters of a million dollars from the plan.
But just keep in mind.
Some of the revenue from the deferred revenue.
Three quarters of $1 million.
Is indicative of the in place.
Portland quarterly revenue run rate.
As I explained earlier, when you compare expenses for research and development and G&A in the third quarter 2021.
Against the same quarter of 2020.
Please keep in mind that the 2020 numbers reflect spending only for all sides to come.
For 2021 culture.
Crude input to the full three months.
Right.
Scientists are included only since August of 'twenty.
2021.
So turning now to research and development expenses, you'll see that they decreased from $4 4 million for the three months ended September 32020.
The $3 4 million for the three months ended September 32021.
A decrease of just under $1 million or 21, 6%.
And the decrease was primarily attributable to onetime patent expenses totaling approximately $3 8 million.
Which were incurred in 2020.
Arising from the transfer of intellectual property to all start to come by.
Previous parent company immune therapeutic.
Those expense without the reduction in expenses was offset by increased spending on R&D programs for the three months ended September 32021.
And that increase of $3 4 million compared to a half a million for the same period in 2020.
Please refer to the 10-Q that we filed earlier today. If you look at the specific page references liquid painting 24 to 27.
Find more detail.
The 2021 R&D spending by indication.
Yes.
You'll see that most of the 2021 spending was on chrome through search.
But post acute COVID-19 and then pancreatic cancer.
Turning quickly to the G&A expenses.
<unk> from one point to $8 million in the three months ended September <unk> September 32020.
The $6 3 million for the three months ended September 32021.
There was an increase of $4 5 million or 253% year over year.
Most of the increase is attributable to growth in head count.
Also in 2020, I'm trying to come with a private company and the <unk>.
Consequent public and being public through the merger added significantly to our G&A expenses in 2021.
So for the three months period ended September 32021 to Teva posted a net loss from operations of $12 $7 million.
<unk> 47 per share.
Compared to a net loss of $5 7 million or $1 84 per share for the same period last year.
And that loss also included accruals for legal settlement, we accrued $1 $8 million for that.
Interest and other shale related expenses of $707000.
You call it could just flip to slide seven.
Continuing on slide seven when we reported <unk> June 32021 for launch that position back in August.
You referenced the fact that <unk> had become coffee to two financing arrangements entered into but Oh, sorry, the calm before the merger.
For the person asking arrangement with the loan agreement.
In April 2021 with Avenue ventures opportunity fund.
And we described one of the loan terms in detail and in August filing and repeated some of them in the in the 10-Q.
In May 2021, we drew down the 15, the full $16 million of the loan from Avenue.
We were required to put 5 million of the proceeds into an escrow account.
And the 10 million balance became available to us immediately the general operation.
The $5 million is still in escrow will be released to us when we meet the conditions of the agreement.
And particularly if the issuance of an additional equity in excess of $20 million.
The second financing arrangement that we have announced previously.
It's an equity line of credit, which we entered into in May of 2021, with GE and global yield LLC.
And one of the under the G M deal.
The company May sell from time to time up to $75 million in shares of its common stock.
At a price equal to 90% of the recent trading price of the company's common stock.
I just want you all to be aware that the availability of the full $75 million.
Subject to certain conditions.
Including being subject to a NASDAQ rule with no single shareholder my own controlling more than $19, 99% of the car.
<unk> stock.
And that's the.
The time, we reported in the 10-K today, we have Nokia to U D. G E M facility.
So as Mike mentioned earlier.
September 32021, we had cash cash equivalents and restricted cash on hand of $14 $4 million.
And that represents an increase of $13 8 million since the end of alone fiscal year December 31 2020.
The increase in cash was closed.
Partly through the cash contributed to the merged company by CB Alliance in Quest.
The cash we raised from the New ventures lost me.
And then this was offset by the net cash we used in operations and as you'll see from the 10-Q, we used 21 $21 million.
In operations for the first nine months ended September 32021.
So at.
At the time, we're speaking to you this evening representing somebody with finalizing.
Budget for 2022.
Budget spending is not absolutely committed and when we can.
You mentioned lead to under current conditions to execute only on our key objectives and potentially to acquire assets opportunistically.
Given however.
We prefer to be honest the budget objectives.
The ability to cover a bunch of spending for the next year only from our existing equity line would.
It would be dependent on our stock performance over the next couple of coaches.
Determined that it would be prudent to have in place by year end additional binding commitments to give us more capital.
And so that and we are engaged in discussions with three new investors.
And to existing investors to obtain new debt and equity commitments.
Jason up to $60 million.
We're also currently in discussions for the potential sale or out licensing of drug candidates.
We're entering into other strategic transactions to raise capital to fund the final budget.
We'll announce specifics of these transactions as soon as we have the summer since we have binding commitments from the other parties.
So with that description of the income statement, the balance sheet and the cash flow position for the company and at the end of September I'd like to return the call to Michael himself.
Great. Thank you Peter.
As I stated earlier, the Terrorist's ball positioned to become a leader in the field of immune modulation last month, we received institutional review board or IRB approval to conduct a phase one pilot study at Loma, Linda University Health Center to evaluate one of our drugs that 205.
The treatment potential treatment for acute COVID-19 Roma.
Melinda has started screening patients for this study and the first patient is expected to be treated this month and we expect to have preliminary data readouts in mid 2022.
In the meantime, we are aggressively advancing our clinical program in pediatric Crohn's disease, and anticipate site activation by the end of the year and enrollment in the pivotal phase III trial to start next year.
To discuss these and our other clinical programs I'd like to turn the call over Dr. Tanya and Mark <unk>, our Chief operating Officer Tanya.
Thank you Mike So turning to slide nine you can see that sits here is well positioned to further the development of our clinical stage pipeline and continues to expand our capabilities.
Support the breadth of our toll receptor pipeline.
As Mike mentioned, we've initiated a phase one pilot program at Loma Linda to evaluate the safety.
Tolerability and pharmacokinetics.
Step two O five in patients with acute COVID-19 infection.
Statue of five is an immune modulator designed to decrease elevated inflammatory responses associated with viral infection.
Inhibit viral replication.
The study is targeted for PK biomarker and safety analysis, and rolling up to 24 patients.
It represents an important step for us to Tara and potentially also millions of people who have become infected with COVID-19, and highly contagious variants as long as those struggling with post acute COVID-19 syndrome or P. A C S.
The terrorists considering a study under the existing IMD to reevaluate that two O five safety and its ability to improve disease progression or resolve long term symptoms.
Now turning to slide 10 during 2022, we see several more clinical trials getting underway.
Following a productive in the phase two meeting with FDA earlier. This year, we anticipate enrolling patients in a phase III clinical trial for our lead drug candidate that two O. One.
For the treatment of pediatric patients with Crohn's disease.
Studies show that because the signs and symptoms of the disease are unpredictable and patients living with chronic endure significant burdens not only physically but also emotionally and economically and this can be even more challenging for children and their parents.
So Cara continues to evaluate Cleveland Biolab development pipeline, and we see a tremendous opportunity for empowerment and the next generation G. P 532 based on the potential that toll like toll like receptor five agonist have shown in hematology, specifically for the treatment of neutropenia.
And anemia in cancer patients.
These are common and sometimes life threatening conditions facing cancer patients when chemotherapy and radiation treatments disrupts the body's production of white blood cells.
Or red blood cells.
As many as 50% of cancer patients will develop anemia or reduction in their red blood cells adequate at some point.
And as many as 60000 patients are hospitalized with neutropenia every year.
We believe and told me it could become a critical component of the treatment regimens for cancer patients.
We have re initiated discussions with the FDA in order to establish the development program in oncology and hematology and discussions are underway with a leading academic institution RPI to investigators study within TV.
We will provide more information at a later date as things become more firmed up.
And then of course, there's the pancreatic cancer program.
Pancreatic cancer is a devastating disease now counted as the third leading cause of cancer death behind lung and colon cancer.
We're developing stats four O one as an adjunct to the standard of care therapy to extend the duration of disease remission in patients with pancreatic cancer.
The S T a.
Granted previously stacked, Florida, one orphan drug designation.
In August this year the company received feedback following a type C meeting with U S regulators.
Regarding stat for one and our plans for clinical development.
We have established an advisory panel of oncology experts and are initiating.
Establishing drug supply for clinical studies, and we now expect to be able to initiate a clinical program a phase <unk> clinical trial during the first half of 2022.
With that I'd like to hand, the call back to Mike.
Great. Thank you Tanya and as I said earlier these are exciting times for Terra and we look forward to building upon the current momentum throughout the remainder of 2021 and into 2022 I would now like to take any questions and joining me for the Q&A portion of this call is our Chief Financial Officer, Peter Ernst Our Chief operating Officer.
Dr timing in Mexico, and our VP of finance Christophe with that I'll now open the call to any of your questions.
Participants we will now begin the question and answer session to ask a question over the phone you May press. The Starkey followed by the number one from your telephone keypads to withdraw your request you May press the pound key.
Again, Thats star one to ask the question or the Pouchy to withdraw your request.
Okay.
Since there are no further questions at this time I'll now turn the call back over to Michael Hanley for closing remarks.
Great. Thank you.
As we've discussed today with Taro is gearing up to hit on all cylinders. So we've achieved a great deal during the past year, which we're very proud of and we're working hard to maintain that momentum.
In the coming months, we expect to achieve multiple milestones generating value for our shareholders as we intend to advance our clinical stage programs and pursue further research alliances.
At this time next year, we can be treating patients in clinical trials exploring three investigative immune modulating programs across multiple indications, including a phase III pivotal trial, we will continue to execute our growth strategy and we look forward to providing periodic updates I'd like to thank all of our employees for their dedication loyalty and hard work and there's always I wanted to thank our.
Stakeholders and shareholders for their continued support.
Appreciate your time and attention today and I'd like to extend my sincere wishes and good helpful. Thank you.
This concludes today's conference call. Thank you all for joining you may now disconnect.
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Yes.
Good morning, ladies and gentlemen, and thank you for joining us for <unk> Biopharma, Inc. 's third quarter 2021 financial results Conference call.
Following the prepared remarks from the company, we will open the call for questions.
I would now like to turn the call over to the stairs executive Vice President of Investor Relations, Nicole Ocean or ma'am you may now begin.
Good afternoon, everyone and thank you for joining the <unk> Biopharma <unk> 2021 third quarter financial results and corporate update call earlier. This afternoon. The Terra Biopharma issued a press release detailing the financial results for the three and nine months ended September 30th 20.
21, which we encourage listeners to read the press release can be found in the investors section pushed the Terra Biopharma dot com.
Tara also filed a 10-Q this afternoon, which is available on Etsy Dot Gov before beginning todays call I would like to make the following statement today, we will be making certain forward looking statements about operating metrics future expectations plans events and circumstances, including statements.
Our strategy future operations, and the development and effectiveness of our investigational drug candidate <unk>.
And our expectations regarding our capital allocation and cash resources. These statements are based on current expectations and you should not place undue reliance on these statements actual results may differ materially due to our risks and uncertainties, including those detailed in our most recent 10-K filing.
The Terra disclaims any obligation to update information contained in these forward looking statements, whether as a result of new information future events or otherwise.
On today's call is Michael Kaye, Handley, President and CEO of the Terra Biopharma, Inc, who will provide an update on the terrorist recent corporate and clinical achievements and the company's vision for the future.
Mr. Peter <unk>, Chief Financial Officer of the Terra Biopharma.
Who will discuss the company's financial results and Doctor Tanya Mark Scott Chief operating officers to Tara, who will discuss the company's clinical programs.
I'd now like to turn the call over to our CEO Michael Hanley, Michael. Please go ahead.
Yeah.
Great. Thanks, Nicole and thanks, everyone for joining our conference. This afternoon and included all of you joining for the first part.
Today I'm speaking to you as CEO of <unk> Biopharma.
Just three months ago, we were known insider club.
Through the reverse merger with Cleveland Biolab from the acquisition of the drug development Company and Quest Lifesciences, we emerged as a publicly traded company at the end of July.
Focused on developing the next generation of immune modulating agents addressing autoimmune infectious disease cancer and blood disorders.
The new company deserves a new day reflective of the company's core focus on that.
On September one 2021 recently rebranded Terra Biopharma with a new ticker symbol S. T E P.
Our names Taro has taken from a lot word balance this with our corporate tagline restoring immune health were chosen to reflect the strategic focus of the company and all of our pipeline.
So terra is a clinical stage biopharmaceutical company at the forefront of developing the next generation of therapeutic agents focused on immune modulation and the restoration of immune homeostasis in simple terms, we are driving the science, which demonstrates that an overactive underactive immune system can drive disease progression where folk.
On developing drugs to restore and rebalance the immune system.
The address autoimmune blood disorders, infectious disease and cancer.
With the recent merger we have created one of the largest toll receptor platforms and since then we have not slowed down.
We need that to slide four.
Our pipeline focus is initially targeting autoimmune disease with the staff to a work program in pediatric Crohn's disease.
Let's expand into hematology, but the stat, 600 progress or intolerant and oncology with a stop for one program in pancreatic cancer.
Beyond our clinical programs. We're also working to develop new second generation assets to further support our growth strategy and deepening our pipeline.
We are already screening. These first round of second generation immuno modulus, where it compounds harnessing the tools and capabilities of our <unk> life science subsidiary to sweat those compounds are most likely to succeed in preclinical and clinical trials.
Tara is also establishing new research Alliance in August we finalized a five year drug discovery agreement with the toilet and institute of Immunology.
Directed to research that will support the development of potential new immune modulating agents targeting toll like receptors for the treatment of cancer infectious autoimmune and some chronic inflammatory diseases.
The research will harness the terrorists proprietary drug discovery and development platform technology.
We were pleased to add this prestigious research centre to the growing list of those involved in our clinical programs.
<unk> on this list is long haul Linda University Health and Roswell Park comprehensive cancer Center in Buffalo New York.
Work is also underway to integrate the former Inquests life Sciences in Cleveland Biolab organizations as well as the subsidiaries and joint ventures with the Tara.
We're exploring opportunities to monetize noncore assets.
In the meantime, we expect to achieve several clinical and corporate milestones over the next 12 to 18 months.
Our ultimate goal is to change the way people think about immunotherapy.
Terra has promising technology focus on delivering immune therapies that target toll like receptors type of protein central to the immune response that plays a key role in fighting disease or a storm immune homeostasis.
We believe the Terra now has one of the largest platforms of toll like receptors in the pharmaceutical industry with our toll like receptor four toll like receptor nine antagonists and our toll like receptor five agonist since all of them at G. P platform too.
We also plan to further strengthen the balance sheet to enable the growth and expansion of our pipeline.
Our CFO, Peter and Sam.
We will review, our quarterly numbers and financing arrangements, including our credit facility and equity line of credit agreement. The company ended the third quarter with approximately $14 4 million in cash on hand, and expect the strength of our capital position at the end of the year to further growth to further grow our initiatives fun business development plans.
Development of our internal pipeline.
With that as an intro I'd like now to hand, the call over to CFO of Purion, Stan who will discuss the third quarter financial results Peter.
Thanks, very much Mike.
As Mike just pointed out this is the first time, we're speaking to the investors and analysts from the terror.
The newly merged company.
So before I go into more detail about the number could be filed in the 10-K 10-Q today.
Let me briefly describe how the room for accounting for the merger.
To present those numbers.
You'll read in the 10-K for example, with the accountants to by the end of the mergers was all tried to come.
I'll also read the surviving legal entity with old Seabee ally.
Even though it's Mike as mentioned to choose between Baptist tied to come immediately after the merger.
And then later on.
The main.
Sarah.
So what are those accounting to me when we speak about accounting legal survivor.
They need to work with the results that we presented in the 10-Q.
With that I'd like to go through these numbers and to keep in mind three thing.
So when you look at the income statement until the P&L.
Does that statement of the accounting for that either you're looking in the P&L, but also to.
To come.
And what you are seeing there in the P&L is the result of all this kind of 'twenty.
2021 excuse me the end of June, but I'll try to come only.
So there's no revenue or expenses included in those period for <unk>.
Right.
Keep in mind that the merger with increased only closed at the end of June this year.
As Michael mentioned the merger with <unk> when we close at the end of July.
For the three months ended September 32021.
P&L combines the litho side to come with the results for those other companies.
Only from the closing date of each month to the end of September.
So for those of you who like to perform comparison.
In relation to prior periods.
Please keep in mind that those comparisons will really only become meaningful when we get to and we report the third quarter 2022.
Youll see in the 10-Q the term accounting survive.
What that means from a balance sheet perspective.
Assets and liabilities presented up to the merger date for those who are outside to come only.
So that's the assets and liabilities only not the equity accounts.
Assets and liabilities the old CP Alliance M class the only added to the balance sheet from their respective merger date.
And then the whole thing to keep in mind is that because.
Right.
I think the legal entity.
It's Brian the only thing that's the articles is registered with the state of Delaware.
The merger.
So that means for reporting.
The statement of equity as shown in the balance sheet authorized and issued common stock authorized and issued preferred.
Is that the P P align and old to come fully merged only for opioids in the report.
That's why for example, if you learn over time to come into that that.
You don't see any references in the equity section to the preferred shares issued by old side to come in 'twenty, 'twenty and 2021.
The old project come shares were exchanged in the nature of common shares in <unk> and <unk>.
Now keeping their quotas in the equity section.
Tara common share.
If there's any questions about the nature of the accounting.
Be happy to take them at the end of the formal presentation.
Turning now to the next slide slide number six in the presentation. Let me just talk very briefly about the results reported.
For.
The nine months in the three months in the 10-Q.
The company reported revenues of $236000 in the Covid went into September.
September 32021.
All of those revenues were derived from the services provided by inquest.
Yes.
Cost of revenues was approximately $116000.
Which means that they made a gross profit of 120000 to approximately 51%.
And as I just mentioned a few minutes ago, we recorded no revenues in the same period of 2020, because the merger with increased only became effective at the end of June 2021.
I just wanted to point out as an aside also with at the inquest recognized as revenue.
When it's delivered to its final research proposed to its customers.
Even if it is collected cashman advances so does.
Livery of the recall.
The cash received the full delivery as shown on the balance sheet as deferred revenue.
At September.
September 30th 2021 balance sheet, you'll see that we reported deferred revenue.
Approximately $506000 in this manner.
And that indicates to you that since the beginning of July.
In total and of course this collected approximately three quarters of a million dollars from its calling them.
So just keep in mind.
Also revenues plus the deferred revenue almost three quarters of a million dollars.
Is indicative of the Inquests.
Calling quote revenue run rate.
As I explained earlier, when you compare expenses for research and development and G&A in the third quarter 2021.
Against the same quarter of 2020.
Keep in mind that the 2020 numbers reflect spending only for all sides to come.
2021 third quarter.
<unk> <unk> for the full three months.
Okay.
<unk> expenses are included only since August 28, two.
2021.
So turning now to research and development expenses, you'll see that they decreased from $4 4 million for the three months ended September 32020.
The $3 4 million for the three months ended September 32021.
Decrease of just under $1 million or 21, 6%.
The decrease was primarily attributable to one time patent expenses totaling approximately $3 8 million.
We incurred in 2020 arising from the transfer of intellectual property to Oaks hard to come by.
Previous parent company immune therapeutic.
Those expenses will that production and expenses was offset by increased spending on R&D programs for the three months ended September 32021.
The increase of $3 4 million compared to a half a million for the same period in 2020.
Please refer to the 10-Q that we filed earlier today. If you look at the specific page references look at pages 24 to 27, where you will find more detail about.
The 2021 R&D spending by indication.
Yes.
You'll see that most of the 2021 spending was on Crohn's, where search followed by post acute COVID-19.
And then pancreatic cancer.
Turning quickly to the G&A expenses.
The increase from one point to $8 million in the three months ended September 20 September 32020.
The $6 3 million for the three months ended September 32021.
There was an increase of $4 5 million or 253% year over year.
Most of the increase is attributable to growth in head count.
Also in 2020 and try to come with a private company.
And the consequent public and being public through the merger added significantly to our G&A expenses in 2021.
For the three month period ended September 32021 to Teva posted a net loss from operations of $12 $7 million.
<unk> 47 per share.
Sure.
Compared to a net loss of $5 7 million or $1 84 per share for the same period last year.
Net loss also included accruals for legal settlement, we accrued $1 $8 million for that.
And interest in other shale related expenses $707000.
You call it could flip to slide seven.
Yeah.
Continuing on slide seven when we reported <unk> June 32021 financial position back in August.
We referenced the fact that <unk> had become currency to financing arrangements entered into but also to come before the merger.
So the person asking arrangement with the loan agreement.
In April 2021 with Avenue ventures opportunities fund.
And we described that one of their own towns in detail and in all the styling and repeated some of them and are in the 10-Q.
In May 2021, we drew down the 15, the full 15 million of the loan from Avenue.
We were required to put $5 million the proceeds and our national account.
And the 10 million balance became available to us immediately.
General operation.
The $5 million is still in escrow will be released to us when we meet the conditions of the agreement.
Particularly as the issuance of an additional equity in excess of $20 million.
The second financing arrangement that we have announced previously.
It's an equity line of credit, which we entered into in May of 2021, with GE and global yield LLC.
Another under the G M deal.
The company May sell from time to time up to $75 million in shares of its common stock.
At a price equal to 90% of the recent trading price of the company's common stock.
I just want you all to be aware that the availability of the full $75 million subject to certain conditions.
Including being subject to a NASDAQ rule with no single shareholder may own a controlling more than $19 99% of the.
Company stock.
And at.
At the time, we reported in the 10-K today, we have not yet used D. G E M facility.
So as Mike mentioned earlier.
September 32021, we had cash cash equivalents and restricted cash on hand of $14 $4 million.
And that represents an increase of $13 8 million since the end of last fiscal year December 31 2020.
The increase in cash was closed.
Partly through the cash contributed to the merged company.
TV line in quest.
Plus the cash we raised from our at the New ventures well for me.
And then this was offset by the net cash we used in operation do you think that you'll see from the 10-Q, we used 20 $21 million in operations for the first nine months ended September 32021.
So at.
At the time, we're speaking to you this evening representing somebody we're finalizing.
Our budget for 2022.
Budget spending is not absolutely committed.
We can modulate towards under current conditions to execute only on all key objectives and potentially to acquire assets opportunistically.
Given however.
We would prefer to have one of the budget objectives.
Relative to cover a bunch of spending for the next year only from our existing equity line.
Would be dependent on our stock performance over the next couple of coaches.
We did.
Determined because it would be prudent to have in place by year end additional binding commitments to give us more capital.
So that and we are engaged in discussions with three new investors.
And to existing investors to obtain new debt and equity commitments aggregating up to $60 million.
We're also currently in discussions for the potential sale or out licensing of drug candidates.
Turning into other strategic transactions to raise capital to fund the final budget.
We'll announce specifics of these transactions as soon as we have these sort of as soon as we have binding commitments from the other penalties.
With that description of the income statement, the balance sheets and the cash.
Cash flow position for the company and at the end of September I'd like to return the call to Michael himself.
Great. Thank you Peter.
As I stated earlier, the Terra is well positioned to become a leader in the field of immune modulation last month, we received institutional review board or IRB approval to conduct a phase one pilot study at Loma, Linda University Health Center to evaluate one of our drugs that 205 as a treatment potential treatment for acute COVID-19.
Loma Linda has started screening patients for the studies and the first patient is expected to be treated this month and we expect to have preliminary data readouts in mid 2022.
In the meantime, we are aggressively advancing our clinical program in pediatric Crohn's disease, and anticipate site activation by the end of the year and enrollment in the pivotal phase III trial to start next year.
To discuss these and our other clinical programs I'd like to turn the call over Dr. Tanya Mark Decker, our Chief operating Officer Tanya.
Thank you Mike.
Turning to slide nine you can see that so terra is well positioned to further the development of our clinical stage pipeline and continues to expand our capabilities to support the breadth of our toll receptor pipeline.
As Mike mentioned, we've initiated a phase one pilot program at Loma Linda to evaluate the safety.
Tolerability and pharmacokinetics of <unk>.
That two O five in patients with acute COVID-19 infection.
Step two of five is an immune modulator designed to decrease elevated inflammatory responses associated with viral infection.
Viral replication.
The study is targeted for PK.
Io marker and safety analysis, and rolling up to 24 patients at.
It represents an important step first of terror and potentially also millions of people who have become infected with COVID-19, and highly contagious variance as well as those struggling with post acute COVID-19 syndrome or P. A C S.
The terrorists considering a study under the existing IMD to evaluate that two O five safety and its ability to improve disease progression or resolve long term symptoms.
Now turning to slide 10 during 2022, we see several more clinical trials getting underway.
Following a productive in the phase two meeting with FDA earlier. This year, we anticipate enrolling patients in a phase III clinical trials for our lead drug candidate that 201.
For the treatment of pediatric patients with Crohn's disease.
Studies show that because the signs and symptoms of the disease are unpredictable and patients living with chronic endure significant burdens not only physically but also emotionally and economically and this can be even more challenging for children and their parents.
So Cara continues to evaluate Cleveland Biolab development pipeline, and we see a tremendous opportunity for empowerment and the next generation G. P 532 based on the potential that toll like five toll like receptor five agonist have shown in hematology.
Specifically for the treatment of neutropenia and anemia in cancer patients.
These are common and sometimes life threatening conditions facing cancer patients when chemotherapy and radiation treatments disrupt the body production of white blood cells.
Or red blood cells.
As many as 50% of cancer patients will develop an EPS or reduction in their red blood cells adequate at some point and as many as 60000 patients are hospitalized with neutropenia every year.
We believe and told me it could become a critical component of the treatment regimen for cancer patients.
We have re initiated discussions with the FDA in order to establish the development program in oncology and hematology and discussions are underway with a leading academic institution RPI to investigators study within TV.
We will provide more information at a later date as things become more firmed up.
And then of course, there's the pancreatic cancer program.
Pancreatic cancer is a devastating disease now counted as the third leading cause of cancer death behind lung and colon cancer.
We're developing stat 401, as an adjunct to the standard of care therapy to extend the duration of disease remission in patients with pancreatic cancer.
The S T a.
Granted previously stacked 401 orphan drug designation.
In August this year the company received feedback following a type C meeting with U S regulators.
Regarding stat for one and our plans for clinical development.
We have established an advisory panel of oncology experts and are initiating.
Establishing drug supply for clinical studies.
And we now expect to be able to initiate a clinical program a phase <unk> clinical trial during the first half of 2022.
With that I'd like to hand, the call back to Mike.
Great. Thank you Tanya as I said earlier these are exciting times for the Terra and we look forward to building upon the current momentum throughout the remainder of 2021, and then into 2022 I would now like to take any questions and joining me for the Q&A portion of this call is our chief Financial Officer, Peter and Stan.
Our chief operating officer, Dr timing like pickup and our VP of finance Christophe with that I'll now open the call to any of your questions.
Participants we will now begin the question and answer session to ask a question over the phone you May press. The Starkey followed by the number one from your telephone keypads.
To withdraw your request you May press the pound key.
Again, Thats star one to ask a question or the Pouchy to withdraw your request.
Okay.
Since there are no further questions at this time I'll now turn the call back over to Michael Hanley for closing remarks.
Great. Thank you.
You just cut today, she taro is gearing up to hit on all cylinders. So we've achieved a great deal during the past year, which we're very proud of and we're working hard to maintain that momentum.
Coming months, we expect to achieve multiple milestones generating value for our shareholders as we intend to advance our clinical stage programs and pursue further research alliances by this time next year, we can be treating patients in clinical trials exploring three investigative immune modulating programs across multiple indications, including a phase III pivotal trial.
We will continue to execute our growth strategy and we look forward to providing periodic updates.
To thank all of our employees for their dedication loyalty and hard work and there's always I wanted to thank our stakeholders and shareholders for their continued support and.
I appreciate your time and attention today and I'd like to extend my sincere wishes and good helpful. Thank you.
This concludes today's conference call. Thank you all for joining you may now disconnect.