8-K: InMed Pharmaceuticals Reports Q2 Fiscal 2025 Results and Provides Business Update

InMed Pharmaceuticals announces its Q2 fiscal 2025 financial results, highlighting progress in its pharmaceutical pipeline and commercial operations, including positive preclinical data for INM-901 in Alzheimer's disease and the selection of an intravitreal formulation for INM-089 in dry AMD.

Summary

• InMed Pharmaceuticals reported a net loss of $2.6 million for the three months ended December 31, 2024, compared to a net loss of $1.5 million for the same period in the previous year.
• The increase in net loss was primarily due to higher expenses related to pharmaceutical research and development activities, as well as financing costs.
• Pharmaceutical research and development and patent expenses were $1 million for the three months ended December 31, 2024, compared with $0.6 million for the three months ended December 31, 2023.
• BayMedica's commercial business generated revenues of $1.1 million for the three months ended December 31, 2024, compared to $1.2 million for the same period last year, reflecting a 10% decrease due to negative pricing variance.
• Despite the revenue decrease, BayMedica achieved a net income of $0.23 million, representing a 189% improvement over the same period last year, driven by reduced inventory write-downs and lower operational expenses.
• As of December 31, 2024, the Company's cash, cash equivalents and short-term investments were $3.5 million, compared to $6.6 million at June 30, 2024.
• The Company expects its cash will be sufficient to fund its planned operating expenses and capital expenditures through to the end of the second quarter of calendar year 2025, based on cash equivalents and short-term investments of $3.5 million as of December 31, 2024 and the receipt of $2.9M in gross proceeds from financing activities which took place in January 2025.
• Janet Grove resigned from the Board of Directors on February 10, 2025, after shareholders withheld her election at the 2024 Annual General Meeting.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While there are positive developments in the pharmaceutical pipeline and BayMedica's profitability, the increased net loss and decreased revenue raise concerns. The company's limited cash runway also adds uncertainty.

Positives

• BayMedica achieved a net income of $0.23 million, a 189% improvement year-over-year, driven by reduced inventory write-downs and lower operational expenses.
• Positive preclinical results for INM-901 showed a reduction in neuroinflammatory markers related to Alzheimer's disease.
• The selection of an intravitreal formulation for INM-089 marks a critical milestone in advancing the dry AMD program.
• The company received $2.9 million in gross proceeds from financing activities in January 2025.

Negatives

• InMed Pharmaceuticals reported a net loss of $2.6 million for Q2 fiscal 2025, an increase from the $1.5 million loss in the same period last year.
• BayMedica's revenue decreased by 10% to $1.1 million, compared to $1.2 million in the same period last year, due to negative pricing variance.
• Cash, cash equivalents, and short-term investments decreased to $3.5 million as of December 31, 2024, from $6.6 million at June 30, 2024.

Risks

• The company's cash is only expected to fund operations through Q2 2025, depending on BayMedica's commercial revenues and operating expenses.
• The company is subject to risks and uncertainties that could cause actual results to differ materially from those described in forward-looking statements.
• The company's reliance on successful development and commercialization of its pharmaceutical pipeline candidates carries inherent risks.

Future Outlook

The Company expects its cash will be sufficient to fund its planned operating expenses and capital expenditures through to the end of the second quarter of calendar year 2025, depending on the level and timing of BayMedica commercial revenues, as well as the level and timing of operating expenses.

Management Comments

• Eric A. Adams, InMed's Chief Executive Officer, commented, 'We are pleased with the steady progress across both our pharmaceutical pipeline and commercial operations.'
• Mr. Andy Hull commented, 'On behalf of the Board and management of the Company, I would like to extend our sincere gratitude to Janet for her dedication and valuable stewardship over the past three years.'

Industry Context

InMed's focus on Alzheimer's disease and dry AMD aligns with the growing need for treatments in these areas, as current therapies have limitations. The company's approach to targeting neuroinflammation in Alzheimer's, beyond amyloid beta and tau-focused therapies, could provide a competitive advantage. BayMedica's efforts to streamline its supply chain and reduce operational costs reflect a broader industry trend of optimizing operations for profitability.

Comparison to Industry Standards

• Comparing InMed's R&D spending to similar-stage pharmaceutical companies focusing on Alzheimer's and AMD is difficult without specific competitor data, but generally, companies like Alector and Annexon Biosciences, which are also developing neuroimmunology-based Alzheimer's treatments, invest heavily in R&D.
• In the cannabinoid space, companies like Charlotte's Web and CV Sciences have faced similar challenges in maintaining revenue growth amid pricing pressures, highlighting the competitive landscape BayMedica operates in.
• InMed's cash runway extending to Q2 2025 is a critical metric, and its ability to secure additional funding or partnerships will be vital for long-term sustainability, similar to other biotech companies in the development phase.

Management Changes

Stakeholder Impact

• Shareholders may be concerned about the increased net loss and decreased revenue.
• Employees may be affected by the company's efforts to closely monitor expenses.
• Customers of BayMedica may experience changes due to the streamlining of the supply chain.

Next Steps

• The Company is evaluating additional parameters from the long-term in vivo study of INM-901 and is conducting further molecular analyses.
• The Company is expected to report on these aspects of the study in the coming weeks.
• The Board intends to initiate a search for an independent director to replace Ms. Grove as soon as reasonably practicable.

Key Dates