DiaMedica Therapeutics (DMAC) Q4 2022 earnings summary

Executive summary

• 2022 clinical progress was disrupted by COVID-related enrollment delays and an FDA clinical hold on ReMEDy2 after three participants experienced transient, clinically significant hypotension during IV DM199 dosing; no injuries were reported.

• The clinical hold remained in place at year-end. Management attributed the events to a change in IV bag materials that may have increased the delivered dose and was working with the FDA on testing and dose revisions.

• Cash, cash equivalents and marketable securities were $33.5M at December 31, 2022; the CEO said this was expected to fund operations into Q4 2024.

Financial highlights

• FY 2022 net loss was $13.7M versus $13.6M in FY 2021; operating loss was $14.0M versus $13.6M.

• FY 2022 R&D expense was $7.8M, down from $8.8M; G&A expense rose to $6.2M from $4.9M, while other income increased to $0.4M from $0.1M.

• FY 2022 basic and diluted net loss per share was $0.52 versus $0.65; weighted-average shares were 26.44M versus 20.77M.

• No product sales revenue had been generated; accumulated deficit was $96.2M at December 31, 2022.

Outlook and guidance

• Near-term quarterly expenses were expected to stay relatively consistent with recent periods, including Phase 1C costs, until the FDA lifts the ReMEDy2 hold; expenses and operating losses were expected to rise once the trial resumes.

• Part 2 of the IV in-use study was expected in April 2023; preliminary Phase 1C data was expected in May 2023, and REDUX final data analysis was expected by mid-2023.

• The CEO forecast cash runway into Q4 2024; the annual report also expected cash resources to fund planned operations for at least 12 months from the financial statements’ issuance date.

• No product revenue was expected for at least three to four years; substantial additional capital was expected to advance DM199 through clinical development and regulatory activities.