Aequus Reports Third Quarter 2023 Financial Highlights and General Update
VANCOUVER, November 29, 2023 – Aequus Pharmaceuticals Inc. (TSX-V:AQS, OTCQB: AQSZF) (“Aequus” or the “Company”), a specialty pharmaceutical company with a focus on developing, advancing, and promoting differentiated products, today reports financial results for the quarter ended September 30, 2023 (“Third Quarter 2023”) and associated Company developments. Unless otherwise noted, all figures are in Canadian currency.
On August 24, 2023, the Company announced the launch of ZIMED® PF (“ZIMED”), the first preservative-free multi-dose Bimatoprost for glaucoma patients in Canada. “The positive reception of ZIMED among physicians, pharmacists, and patients is a testament to the products unique ability to address healthcare challenges in this category. Our optimism surrounding this launch with our investments in digital resources, retail and managerial expertise, set a promising tone for 2024,” says Grant Larsen, Chief Commercial Officer for Aequus Pharmaceuticals Inc. Canada.
Subsequent to September 30, 2023, the Company entered into a demand loan agreement with the chairman and chief executive officer of the Company, for an additional unsecured demand loan of $1,000,000. The demand loan bears interest at an annual rate of 5%, to be accrued monthly, and is repayable on demand.
Financial Report Highlights
Aequus reported $13,359 in revenue during Third Quarter 2023 compared to revenue of $347,923 generated during the same period in 2022. During the nine months ended September 30, 2023 (“YTD 2023”) Aequus achieved $204,019 in revenues compared to $996,697 generated during the nine months ended September 30, 2022 (“YTD2022”) – a decrease of $792,678, or 80%.
Net losses increased by 61% in Third Quarter 2023 compared to the same period last year, with the Third Quarter 2023 net loss of $803,653 versus a $500,471 loss in the three months ended September 30, 2022 (“Third Quarter 2022”). The loss for YTD 2023 was $2,248,852 which is 2.7% higher than the $2,189,466 loss YTD 2022 primarily due to a decrease of $844,598, or 26% in expenses offset by the reduction of $792,678 in gross income due to the end of the promotional services agreement with Sandoz at the end of 2022, and the pause of sales in Canada for Evolve branded eyedrops in summer 2023. General administration costs were 21% lower in Third Quarter 2023 and 32% lower in YTD 2023 when compared to the same periods last year.
Highlights from the quarter are as follows:
§ Sales and marketing costs for Third Quarter 2023 were $458,101 compared to $506,230 in Third Quarter 2022, a decrease of $48,129 or 10%. This reduction was mainly driven by a decrease in sales forces activities and lower products that require marketing initiatives. Sales and marketing expenses are expected to increase with activities transitioning from “Awareness” building of new product ZIMED to “share and revenue” acquisition.
§ The Company incurred research and development (“R&D”) expenses of $74,095 in Third Quarter 2023 compared to $6,041 in Third Quarter 2022. The Company incurred R&D expenses of $301,280 in YTD 2023 compared to $260,093 in YTD 2022. The $41,187 increase in YTD 2023 was mainly to higher expenses related to the launch process for preservative-free bimatoprost 0.03% eye drops termed “ZIMED® PF”.
§ General and administration (“G&A”) expenses were $278,412 in Third Quarter 2023 compared to $353,571 in Third Quarter 2022, a decrease of $75,159. G&A expenses were $877,238 in YTD 2023 compared to $1,286,576 in YTD 2022, a decrease of $409,338. The decrease was mainly driven by general cost-cutting measures and lower loan-related expenses.
ABOUT AEQUUS PHARMACEUTICALS INC.
Aequus Pharmaceuticals Inc. (TSX-V: AQS, OTCQB: AQSZF) is a growing specialty pharmaceutical company focused on developing and commercializing high quality, differentiated products. Aequus has grown its sales and marketing efforts to include several commercial products in ophthalmology and transplant. Aequus plans to build on its Canadian commercial platform through the launch of additional products that are either created internally or brought in through an acquisition or license, remaining focused on highly specialized therapeutic areas. For further information, please visit www.aequuspharma.ca.
FORWARD-LOOKING STATEMENT DISCLAIMER
This release may contain forward-looking statements or forward-looking information under applicable Canadian securities legislation that may not be based on historical fact, including, without limitation, statements containing the words “believe”, “may”, “plan”, “will”, “estimate”, “continue”, “anticipate”, “intend”, “expect”, “potential” and similar expressions. Forward- looking statements are necessarily based on estimates and assumptions made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as the factors we believe are appropriate. Forward-looking statements include but are not limited to statements relating to: the implementation of our business model and strategic plans; revenue growth trends into the future; expected timing for product launches; the Company’s expected revenues; the regulatory approval of its products; the Company’s ability to attract international partners; and ongoing discussions with and the Company’s ability to secure potential partners to further grow our product portfolio. Such statements reflect our current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Aequus, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our 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. In making the forward looking statements included in this release, the Company has made various material assumptions, including, but not limited to: obtaining regulatory approvals; general business and economic conditions; the Company’s ability to successfully out license or sell its current products and in-license and develop new products; the assumption that the Company’s current good relationships with third parties will be maintained; the availability of financing on reasonable terms; the Company’s ability to attract and retain skilled staff; market competition; the products and technology offered by the Company’s competitors; the impact of the coronavirus (COVID-19) on the Company’s operations; and the Company’s ability to protect patents and proprietary rights. In evaluating forward looking statements, current and prospective shareholders should specifically consider various factors set out herein and under the heading “Risk Factors” in the Company’s Annual Information Form dated May 1, 2023, a copy of which is available on Aequus’ profile on the SEDAR website at www.sedar.com, and as otherwise disclosed from time to time on Aequus’ SEDAR profile. Should one or more of these risks or uncertainties, or a risk that is not currently known to us materialize, or should assumptions underlying those forward-looking statements prove incorrect, actual results may vary materially from those described herein. These forward-looking statements are made as of the date of this release and we do not intend, and do not assume any obligation, to update these forward-looking statements, except as required by applicable securities laws. Investors are cautioned that forward-looking statements are not guarantees of future performance and are inherently uncertain. Accordingly, investors are cautioned not to put undue reliance on forward looking statements.
On behalf of the Board of Directors,
“Douglas Janzen”
Director & CEO
CONTACT INFORMATION
Aequus Investor Relations
Email: investors@aequuspharma.ca
Phone: 604-336-7906
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this news release.