Dr. Don Cilla reports
APPILI THERAPEUTICS REPORTS FISCAL YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS
Appili Therapeutics Inc. has released its financial and operational results for the fiscal year ended March 31, 2024, and has provided an update on the company's strategy for fiscal 2025.
"Notably, during this past fiscal year, the company's most advanced asset, Likmez (ATI-1501), received U.S. Food and Drug Administration approval, and together with our partner, Saptalis [Pharmaceuticals LLC], launched the product and commercial sales, which remain ongoing. The launch of Likmez, shortly after securing patent coverage through 2039, is an important milestone that demonstrates Appili's ability to identify promising opportunities, accelerate their development, and unlock value for the benefit of both patients and shareholders," said Don Cilla, PharmD, MBA, and president and chief executive officer of Appili. "The U.S. Air Force Academy also awarded funding commitments for the advancement of ATI-1701, bringing the total program funding awarded to approximately $14-million (U.S.). These funding commitments strengthen Appili's foundation in biodefence and should enable us to continue to advance this program towards an investigational new drug application."
Likmez ATI-1501 is FDA approved for the treatment of anaerobic bacterial infections
During fiscal year 2024, Appili announced the FDA approval of Likmez (ATI-1501), its proprietary taste-masked liquid suspension formulation of metronidazole, through its U.S. partner, Saptalis.
Likmez is the first and only Food and Drug Administration-approved ready-made suspension of metronidazole for the treatment of anti-microbial infections that addresses the unmet need in patients with dysphagia to avoid risks associated with drug compounding and discontinuation-related anti-microbial resistance. Saptalis launched Likmez in November, 2023, and commercial sales in the United States are continuing.
In May, 2023, U.S. Patent and Trademark Office published patent claims for ATI-1501 under the U.S. application No. 18/072,154, which covers the composition and preparation methods for the drug through 2039. Collaborating with Saptalis, Appili earned $600,000 (U.S.) in milestone payments during fiscal year 2024. Appili expects to receive additional sales-based milestone payments and royalties from Saptalis based on sale of the product.
ATI-1701, biodefence vaccine candidate, with funding awarded from the U.S. Air Force Academy
ATI-1701, a novel, live-attenuated vaccine for the prevention of F. tularensis, has received awards totalling $14-million (U.S.) from the U.S. Air Force Academy. Under the terms of the USAFA co-operative agreement, Appili will oversee a comprehensive development program for ATI-1701, which includes non-clinical studies, CMC/manufacturing, clinical preparatory and regulatory activities to support an investigational new drug submission in 2025.
Appili has had interactions with the FDA in the form of a pre-IND meeting, confirming the development pathway for the company's efforts through IND submission, and is incorporating suggested changes in the development plan.
ATI-1801, its licensed topical anti-parasitic product, demonstrated safe and effective across phase 3 studies
ATI-1801 is a novel topical formulation of paromomycin (15 per cent w/w) under advanced clinical development for the treatment of cutaneous leishmaniasis, a disfiguring infection of the skin that affects hundreds of thousands of people around the world annually.
Appili is currently engaging with the FDA and submitted a Type B meeting request with the FDA in 2024 to discuss linking to the previously generated phase 3 data and agreeing on the necessary registration package to support a new drug application submission, which the company expects will include available non-clinical, manufacturing and clinical data generated to date. Appili expects to pursue non-dilutive funding and partnership opportunities with non-governmental organizations and government agencies, which share the company's focus on tropical diseases to help complete remaining development work.
ATI-1801 has received an orphan drug designation from the FDA for the treatment of certain forms of cutaneous leishmaniasis. The company is actively evaluating the eligibility of ATI-1801 for a priority review voucher, which, if confirmed, would make ATI-1801 the second PRV eligible program at Appili, joining ATI-1701, subject to renewal of certain legislation in the United States.
Aditxt Inc. arrangement
Subsequent to fiscal year 2024, on April 2, 2024, the company announced that it had entered into a definitive arrangement agreement pursuant to which Aditxt, through its wholly owned subsidiary, Adivir Inc., agreed to acquire all of the issued and outstanding Class A common shares of the company by way of a court-approved plan of arrangement under the Canada Business Corporations Act. Under the terms of the arrangement agreement, shareholders of the company will receive: (i) 0.002745004 of a share of common stock of Aditxt; and (ii) 4.67 U.S. cents in cash, for each common share held at the time of the closing of the proposed arrangement.
The arrangement is subject to certain customary conditions, including court and shareholder approval. The arrangement is also subject to Aditxt raising a minimum of $20-million (U.S.) in additional funding. Since the date of the arrangement agreement, Aditxt has raised approximately $5.5-million (U.S.). However, these funds have not been specifically reserved for the arrangement. Aditxt is continuing its efforts to raise additional capital as required to complete the arrangement.
A special meeting of the shareholders of Appili is expected to be held in third quarter calendar 2024, and, subject to satisfaction or waiver of the applicable closing conditions, the arrangement is expected to be completed before the end of Q3 calendar 2024. For further details regarding the arrangement, please see Appili's press release dated April 2, 2024. Additional information regarding the arrangement will be included in the management information circular of Appili to be mailed to the Appili shareholders prior to the Appili shareholders meeting.
Annual financial results
The company prepares its financial statements in accordance with international financial reporting standards as issued by the International Accounting Standard Board and Part I of the Chartered Professional Accountants of Canada handbook -- accounting.
The net loss and comprehensive loss of $3.8-million or three-cent loss per share for fiscal year 2024 were $5.4-million lower than the net loss and comprehensive loss of $9.2-million or eight-cent loss per share during the year ended March 31, 2023. This relates mainly to a $5.7-million increase in government assistance, relating to the USAFA co-operative agreement, a $500,000 increase in revenue, a $1.4-million decrease in general and administrative expenses, and a $300,000 decrease in exchange loss, offset by a $2-million increase in research and development expenses, and a $500,000 increase in financing costs.
On March 31, 2024, the company had cash of $100,000 compared with $2.5-million on March 31, 2023. The company has included a going concern note in its financial statements for the fiscal year 2024. In particular, the company is dependent in large part on closing the proposed transaction with Aditxt or raising additional financing through equity and/or non-dilutive funding, and receiving all USAFA funding in a timely manner. Delays in reimbursement for previously submitted expenses in the near term may, in the absence of alternative funding arrangements, result in the company not being able to meet various covenant obligations as required pursuant to its long-term debt arrangements with Long Zone Holdings Inc. For further details, please refer to the company's going concern note in the company's management's discussion and analysis for the fiscal year 2024.
As of June 25, 2024, the company had 121,266,120 issued and outstanding common shares, 11,520,281 stock options and 44,856,874 warrants outstanding.
This press release should be read in conjunction with the company's audited annual consolidated financial statements for fiscal year 2024, and the related MD&A, copies of which are available under the company's profile on SEDAR+.
About Appili Therapeutics
Inc.
Appili is an infectious disease biopharmaceutical company that is purposefully built, portfolio driven and people focused to fulfill its mission of solving life-threatening infections. By systematically identifying urgent infections with unmet needs, Appili has a goal to strategically develop a pipeline of novel therapies to prevent deaths and improve lives. The company is currently advancing a diverse range of anti-infectives, including a Food and Drug Administration-approved ready-made suspension of metronidazole for the treatment of anti-microbial infections, a vaccine candidate to eliminate a serious biological weapon threat and a topical anti-parasitic for the treatment of a disfiguring disease. Led by a proven management team, Appili is at the epicentre of the global fight against infection.
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